A more local economy

How do we shift the Manchester economy to one “where people can thrive without harming the planet”?  Not everyone yet accepts the idea that economic growth cannot go on forever, although they might understand that we are using more of the planet’s capacity than it can stand – ecological overshoot.  But they can often accept the wisdom of some of the key proposals in steady state thinking such as,

  • Reducing reliance on long, fragile, energy-intensive supply chains, especially for our food.
  • Focussing on the things we want the economy to deliver, rather than on the abstract and perverse measures of GDP and GVA.
  • Reducing reliance on imported energy.
  • Retaining and redistributing money locally
    –  Using wealth the city has accumulated to enable needed developments, for example in energy efficient and affordable housing.
    –  Reducing disparities between incomes.
    –  Reducing the leakage of money from the local economy.

These things will all contribute to local prosperity through creating more, decent jobs and will also make the real economy less vulnerable to shocks from a dysfunctional financial system, climate change, international conflicts, arbitrary austerity politics and the like.

So over recent months Steady State Manchester has been in dialogue with local politicians, especially in Manchester City Council to build consensus on this kind of thinking.  We differ from the dominant approach in that we don’t think that the pursuit of China-dependent, trophy-project led growth will provide us with a future that is ecologically, socially or economically viable.  But there is a lot we can agree on, and the above list is not controversial in itself, and it offers a kind of Plan B (or is that C?) for if…. when … the China wager fails.

Specifically, the report of the councillors’ sustainability working group (that came about following discussions on steady state economics in June 2012 and May 2013) was accepted by both Neighbourhood and Economy Overview and Scrutiny Committees this week.  It provides a framework for aligning economic, social and ecological strategy and recommends that this is done (via articulating what ‘good growth’ would look like) when the Manchester Community Strategy is revised, and that a similar approach is taken to monitoring and measurement of well-being in these three dimensions.  This all requires a profound culture change (as argued by MMU senior lecturer in philosophy, Mark Sinclair, this week).  Particular areas for development in healthy and local food, and renewable energy were identified.
The food agenda, tying together the need to address poverty, health, waste, security and resilience, and emissions has already been taken seriously through adoption of an integrated policy by full council.
At Finance Overview and Scrutiny we have initiated a process of inquiry into the scope for ensuring Manchester’s investments are best used for social, economic and environmental benefit, while meeting requirements for decent and sustainable returns.  An interesting discussion took place at this week’s meeting of the committee and it was agreed to include further consideration of this, inviting representatives of Greater Manchester Pension Fund (assets £10Bn), in the committee’s work plan.  Our brief paper in response to the report on ‘non treasury’ council investments is here.  Our view is that GMPF needs to revise its 2007 guidance on ethical investment, clarify what guidelines are given to its contracted fund managers, and building on its best practice, increase the proportion of assets invested in local economic development for the replacement economy, rather than in what (given the certainty of another crash in financial markets) are risky equities.  See also the previous discussion on the council’s own monies and its banking choices.

Finally, look out for our report and launch on pay inequality in Greater Manchester Local Authorities and the ways that councils can exert leverage for greater equality in their local economies.

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