Thursday, July 1, 2010

Building a Sustainable Economy at DR

This is the first of a few articles I will be writing exploring the economics of Dancing Rabbit. The economic system we develop here at DR is vital to the survival and growth of our community. If we are to serve as a model for sustainable societies, it is important that our community be not only ecologically sustainable, but economically sustainable. If we cannot find sustainable ways to meet our basic needs, generate income, and trade and buy goods we will not be a viable model for sustainable living. Though we have in many ways achieved our goal of living more sustainably than most Americans, we are still dependent on the unsustainable global economy for most of our income and livelihood. This dependency contributes greatly to our impact on the planet. Creating a healthy economy based on the same principles of sustainability we employ in our everyday lives at DR will make us an even better model for a new way of living.

But developing a vibrant and ecologically sustainable economy is not easy. Part of the challenge at DR is that we are living in both the sustainable and the unsustainable economy. In our ideal world we would produce everything we consumed, so we had control over our resources and could ensure that production was sustainable. We are far from that and probably will be for the near future. Instead, we bring in resources and money from outside our local economy and we pay out money and resources to the larger economy. We have to have as much coming in from outside as we do going out or we are operating with a deficit. Trade deficits are talked about in the national news, but they can exist on a smaller scale as well. Maintaining a trade deficit will jeopardize the sustainability of our economy. If we can produce something to sell from our domestic resources to offset this deficit we will have a more viable economy. But we have to be careful, because we don't want to export all our natural resources either.

To give an example, we could produce our own food here or, to save us the trouble, we could pay local farmers to produce our food for us. A local farmer could grow beans for us, but unless that farmer is buying anything from us and giving back to our community, we will be running a deficit. Our money is going out but not being recirculated in our economy. When someone is growing beans here, the money we pay the grower will likely stay within the community.

Presently there are many ways we send money out of the community. Health care is a big negative cash flow, though we do provide some of our own care here in the form of home remedies, massage, yoga, etc. However, most of us still go to the local hospital and dentist when we have a major problem. As well, construction-related expenses are a massive flow out of our community, though some members of our community do construction work or sell materials. Other ways we send money out of the community are orders from the natural foods distributor, other groceries, power system components, vehicle-related and other transportation expenses, computers, and entertainment-related expenses. Some people here offset money sent out of the community by bringing in income through their jobs. This positive cash flow is a slightly more complicated matter.

There are basically two ways money is brought into the community (and these are the two ways most people survive here): by members who come here with an established means of making money, and by members who come here with savings that will allow them to live without a stable income for a while until they can find a way to make money. I would hazard a guess that most of the positive cash flow into the community comes from the people who arrive with savings or inherit money. A large portion of the non-savings positive cash flow is from web-based businesses that are run by a relatively small number of community members. Some other sources of income for the community are mid-wifery, FIC (Fed. Of Intentional Comm.)work, non-profit consulting and management, and consensus and facilitation training. A small amount is brought in through the visitor program but this does not cover the costs of the program.

Money brought into the community through outside jobs and savings is then cycled through the economy in the form of construction jobs and the sale of other small scale goods and services provided by community members. DR itself also pays some members for certain jobs. It's possible for someone to survive here working for other people who have a stable income, and often people with money are looking for help and willing to pay for it. However, right now I would doubt whether we could say we have a thriving economy that could provide income for many people who weren't already set up in some way. People who come here with ready-made income sources are essential for the existence of our economy in these early stages of DR's economy(and it will always be helpful to have some percentage of our population arrive with income sources). They can keep our economy afloat until it is healthy and diverse enough that it can provide the community's basic needs.

When I think about economy at DR, I get a sinking feeling that our economy is not really sustainable (or viable) in that instead of bringing in money from outside the community, we are living largely off savings. Some build their houses with their savings and others pay people to help them build their houses. Savings are a good source of income for DR and there is no doubt that this sector of the economy is vital to new people becoming established here, but it is questionable that it would be sustainable if the flow of new members slowed and everyone was living in largely finished houses. Unless those people who arrive with savings (like me) can find ways to make income here they will eventually run out of money.

Another nagging doubt about the sustainability of our economy is the question of whether we are really setting an example for sustainability if our economy is based largely on the the internet and member savings. Setting an example to me means having sustainable businesses and trade that prove an economy can be set up from the ground up along principles of sustainability. These businesses and trade would be based on our knowledge and skills, and on land and resources that we control, instead of being based on distant lands and resources, and unsustainable systems. In addition, by creating businesses and trade that go beyond our community we can offer sustainable alternatives to the global economy and bring in income to offset what we are paying out.

If we can come up with creative ways to generate income and produce our basic needs at DR we can build a more stable economic foundation. Other intentional communities that have been able to survive have had some main cottage industry to generate revenue from outside the community. Twin Oaks makes tofu and hammocks, Acorn has a seed business, East Wind makes nut butters, and Sandhill sells sorghum and honey. We could potentially have many different cottage industries here. A good place to start is with the products people here already buy from outside DR. These are the low hanging fruit and will provide three benefits at once in that someone at DR will have an income source, that money will stay in our economy, and we will not have to go outside DR to meet a basic need. The added benefit is that with our local currency, dollars don't have to be exchanged at all. Construction is one of the low hanging basic services we are already providing for ourselves, but there are many more potential business ideas. Food is something we spend a lot of money on and since we have plenty of land available for growing food this could be a lucrative means of income for someone or a group of people.

At Dancing Rabbit we are unique from and have advantages over some other intentional communities because we have a diversity of potential income sources. This makes DR attractive to people who don't want to be limited in the work they do in their lives. Individuals or groups can start their own businesses that will then eventually provide jobs for others. The Milkweed Mercantile is an example of this kind of business. Jennifer's natural building practicum will build community infrastructure while bringing revenue into our economy and educating others in living more sustainably. There is a lot of expertise here, and a lot of people out there who want to learn from us and would want to buy the things we produce sustainably. We aren't tapping into this potential nearly enough now, though hopefully as people get more established we will. I hope that we will realize what a resource we are and how many people are willing to support us by paying for what we have to offer. What better way to generate income for our community than by helping others do what we all came here to do-- live more sustainably.

So we need to build our own sustainable businesses at DR to meet our basic needs and offset the flow of money out of our community. That is easier said than done. In the next article I will explore the challenges of starting a sustainable production business here.


Anonymous said...

I was wondering esp. when folks get older in the community and health care costs escalate how it will be handled. How do you save for retirement in the community or is retirement and old dynamic that does not add up with your community- in other words do you all contribute somehow to social security or is the fact folks live in community make them exempt- and how does the new health care bill impact DR- where supposedly everyone must have health insurance?

macmcnulty said...

HI Dan, this article is great reading and really hits some great points. It's stuff I'm very interested in for sure. The economics of different systems have always interested me - I think because deep down I've always known the one that I live in is .... well , just bad.
My small family is coming to visit DR at the end of the month and I can't wait to sit down and have a good chat with you about economics. If it's possible I'd like to chat with before my visit about some of the questions we have specifically about DR's economics and what we need to do to prepare ourselves to be as helpful and useful as possible. my email adress is , i hope you'll drop me line.

miniaturehousewife said...

great article dan!

miniaturehousewife said...

great article dan!

Dan Durica said...

Hey Miniature Housewife,
Thanks for reading. How's life in San Francisco? We didn't get to see you when you came for the clown workshop. We miss your creative energy here.