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The New Rules- Summer 1999

Table of Contents

Features

The Buck Starts-and Stops-Here
Thousands of communities have lost local businesses to the clout of national chain stores. But other towns have protected their homegrown economies with zoning ordinances that limit large-scale retail and favor local ownership. By Stacy Mitchell

Getting a Slice of the Pie
Employee ownership may be one way of lessening the capitalism-driven income gap between rich and poor. By Jeff Gates

States Take the Bull by the Horns
Family farmers cheer as plains states pass legislation intended to break up concentration in the meat packing industry. By Stacy Mitchell

No, We Have Plenty of Bananas
But soon none of them will be grown by independent farmers-if the WTO has its way. By Daniel Kraker and David Morris

Microradio Struggles to Regain a Place on the Dial
The FCC has an opportunity to encourage more locally controlled, community-based radio programming, but broadcasting conglomerates say no. By Daniel Kraker

Outlandish Taxes
Property taxes encourage speculation, sprawl and property depreciation. Switching to a land value tax could help combat these urban ailments. By Pam Neary

Departments

editor's note
We should cease to think of increasingly concentrated ownership as an inexorable, unstoppable force of history. We make the rules and the rules make us.

place rules
Consumer coupons could boost local business in Japan. Indie bookstores break ground online at booksense.com. Mayors and counties charge pro-industry slant on Congressional e-commerce tax commission.

[editor's note]

Democratizing Ownership

Traditionally, liberals and conservatives have agreed on at least one central idea: a robust economy and a vibrant democracy depend on the broadest possible ownership of property. Sadly, today's liberals and conservatives also agree on another central idea: concentrated ownership marks the next stage of economic evolution.

The tension between our ideal -- distributed ownership -- and what we believe we must accept -- concentrated ownership -- illuminates much of current policymaking. Some of this tension would disappear if we ceased to think of increased concentration as an inexorable, unstoppable force of history. We forget that unlike an apple falling or the sun rising, the megastore and the megamerger cannot appear without our permission. We make the rules and the rules make us.

Take the issue of bananas. As Daniel Kraker and I point out in this issue, the European Union's banana policy, which guarantees a market for Caribbean producers, has nurtured egalitarian economies inhabited by tens of thousands of independent farmers and farm workers who earn a decent living. By contrast, Central America is characterized by low paid and dependent banana workers, concentrated economic power, absentee ownership, and stark inequality. This spring the U.S. successfully petitioned the World Trade Organization to declare the EU's banana policy a violation of GATT. It was a truly hollow victory.

On the domestic front, the ownership of radio stations has become far more concentrated since Congressional passage of the Telecommunications Act of 1996 allowed far more concentrated ownership. Yet technological developments raise the promise of a dramatic decentralization of ownership in this sector. At this writing, the Federal Communications Commission (FCC) has issued proposed rules for licensing thousands of new microradio stations. Will the rules promote a diversity of views and community-serving stations, or will they encourage the same organizational structures and formats as current commercial radio stations? We report on the controversy.

While Kraker examines policies that can nurture the widest possible ownership of radio, Stacy Mitchell looks at rules that can nurture the widest possible ownership of retail stores. In an excerpt from her new publication, The Home Town Advantage, Mitchell reports on what localities and states are doing to favor enterprises whose relationship to their communities goes beyond simply selling goods or services.

Jeff Gates looks at ownership through a wider lens. He argues that although half of all households own stock, most own very few shares and that the vast majority of us own no wealth-producing assets aside from our own labor. He argues that democratic ownership should become a central tenet of public policy. Gates has the credentials to make the case, since he was one of the original designers of the 1974 law that created employee stock ownership plans (ESOPs). Today there are more than 10,000 ESOPs in the United States, and Gates urges us to expand that distributed ownership model into new structures, like customer stock ownership plans and community stock ownership plans.

From bananas to radio, from retail stores to manufacturing, this issue of The New Rules offers evidence that rules matter. The decisions we make today influence the way our communities and our economies look tomorrow.
-- David Morris

David Morris
Vice President, Institute for Local Self-Reliance
© 1999 Institute for Local Self-Reliance

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