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The New Rules- Summer 2000
Volume 2, Issue 1

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Features

Seeding Power: The Other Problem with GM Crops
No one knows what effect genetically modified foods will eventually have on the environment or on human bodies, but one thing is certain: the benefits of using GM seed will accrue mainly to a handful of corporations. The top-down ownership structure of biotechnology is in stark contrast to the burgeoning organic foods movement, which embraces independent farms and supports local economies. By Brian Levy

Low Power Suffers a Low Blow
Microradio supporters who cheered the FCC's January decision to license up to 1,000 low-watt stations watched in disbelief as the House caved to pressure from the NAB and passed the shamefully misnamed Radio Broadcasting Preservation Act. By Simona Fuma Shapiro

Jack and the Giant School
Higher graduation rates, less violence, a sense of belonging instead of alienation: the case for small schools is supported by mountains of evidence and a growing number of innovative models. But many state and local governments persist in consolidation efforts, fueled by a misguided belief in the effectiveness of giant schools. By Stacy Mitchell

Think Locally, Tax Globally
In the U.S., local businesses are at a 5-7 percent price disadvantage because web retailers are exempt from collecting state and local sales taxes. Some look to the European Union for a more equitable model: there remote sellers are taxed using a system that looks at economic influence rather than physical presence. By Simona Fuma Shapiro

Departments

editor's note
What we need are candidates who understand the importance of locally scaled, community-based systems.

place rules
Iowa's ATM law endangered. Large trucks banned from local Jersey roads. State meat inspection programs revived. Missouri gives cooperatives incentive.

[editor's note]

It's the Community, Stupid!

Presidential advisor James Carville helped keep the 1992 Clinton campaign in focus and "on message" with a simple four-word phrase written on notecards and tacked on the headquarter walls: "It's the economy, stupid." Wouldn't it be wonderful if the successful candidates in this election campaign had a note pinned to the wall of their headquarters declaring, "It's the community, stupid"? It could happen. After all, we all identify in one way or another with our local surroundings. Moreover, the evidence that community and proximity are assets to be nurtured is fast becoming conclusive. Yet policymakers at every level continue to act as if locally scaled, community-based systems are a hangover from an inefficient and primitive yesteryear.

As Stacy Mitchell points out in our cover story, even as the one-room schoolhouses disappear and school districts continue to consolidate, the empirical evidence is screaming for us to reverse direction. Small schools better serve teachers, students, parents and communities. Violence declines. Attendance goes up. Performance soars. Small schools may cost a bit more per student taught, but they actually cost less per student graduated.

The issue of community has always been important in agricultural areas. The evidence is persuasive that family-sized farms are as efficient and far better for their surrounding communities, than large, absentee-owned farms. In December 1997 the United States Department of Agriculture issued a definition of "organic" that included such things as genetically modified crops. The definition clearly favored a certain structure of agriculture: industrialized, absentee-owned, vertically integrated. The USDA's action sparked massive public disapproval and in May 1998 it was withdrawn. Earlier this year the USDA issued a new definition, which represents a major step in the right direction. But as Brian Levy points out in these pages, the new standards raise another question. Should the definition of "organic" encourage organic communities as well as organic crops? Should its definition protect the farmer as well as the soil?

In our courts, the health of communities is rarely given serious consideration, except when it comes to public health issues. The U.S. Supreme Court, for example, repeatedly has denied states the right to impose sales taxes on mail order goods equal to the sales taxes they impose on their in-state businesses. To decide whether the business must pay state or local taxes, the Court developed the concept of "nexus," or physical connection. The Court ruled that a business should pay taxes to a community only when its operation need public services, like streets or police protection. But as Simona Fuma Shapiro points out, Europeans have a decidedly more commensical definition of nexus. European courts have decided that a business must pay taxes if its sales are sufficiently significant to impact a community and its local merchants, even if the business in question lacks a physical presence. That means e-commerce is taxed by European states. The U.S. Congress, on the other hand, continues to prohibit states from taxing goods and services sold over the internet. Some in Congress argue that internet taxation would be an administrative nightmare. Europe's policy disproves that contention.

Consolidated school districts. Concentrated agriculture. Preemption of local and state taxing authority. These are the dominant trends in the U.S. today, and all of our political candidates to date support policies that exacerbate this trend. Yet at the grassroots level, where the voters live, a rebellion is in process. Small schools. Family farms. Local businesses. These are what people want. Because these are the bones and tissue of healthy communities.

"It's the community, stupid." Could it be a winning political slogan?

-- David Morris

David Morris
Vice President, Institute for Local Self-Reliance
© 2000 Institute for Local Self-Reliance

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