Small Town Values Bitch-Slap The Economic Crisis

“Small town values” have been endlessly chanted into the glare of TV cameras by folks who don’t know straw from hay or truth from spin. I may live in a township too tiny to warrant a single stoplight, but I do know that values have more to do with how each of us chooses to live than the way we’re described by politicians or pundits. Every one of our daily choices matter, whether made in the barn or the boardroom. Reawaking small town values, core values I suspect are held by most folks, may be a cure for our national economic woes.

Honesty

Spencer Feed & Supply stocks honey from our hives on their shelves. Feed for our cows is ground right there from local grain and the sale of our honey taken off the bill. Even though no money changes hands we still declare the honey as profit on our taxes. It’s a simple matter of conscience. Most of us sense that dishonesty spurred by greed caused our economic crisis. Blame is readily available while those who admit to creating the problems are scarce. Some people around here trace the problem back to dropping the gold standard or relaxing import tariffs. Plenty pin it on hedge funds, risky mortgage products and speculative bubbles across many markets. Chances are they’re all correct.

But right now the focus is on deregulation, a word spoken as if it stinks. What’s missing is honesty aboutwho is responsible. The policies of deregulation and minimal oversight were themselves speculative. (Why is another matter, clearly due to the overlord Greed and his minion, Secrecy.)

Our township isn’t far from big sister Cleveland, where economic misery trickles down like a shared family disorder. Feisty Cleveland was the first city in the nation to pass a predatory-lending law in 2002. That law was toothless because the state had no legal authority to pursue fraudulent lenders. Why? All 50 state attorneys general attempted to protect consumers from predatory and deceptive lenders, in part due to the federal regulatory void, but the Bush administration vehemently prevented the enforcement of state laws. Instead the administration sided with financial institutions, even filing a lawsuit to protect banks from state investigation.

This was detailed in a Washington Post piece titled, “Predatory Lenders’ Partner in Crime:How the Bush Administration Stopped the States From Stepping In to Help Consumers.”  A few weeks later, thousands of media hours were lavished on a breaking sex scandal by the article’s author, New York Governor Eliot Spitzer. The content of the article was ignored in the typical elevation of ratings over content.

We need a national conscience cleaning The facts must be revealed about how we got in this situation so we can enact safeguards against future economic disasters. And we need to look at the place truth holds in our own lives. If we’re honest with ourselves about what we’re doing and why we’re doing it, we better understand where our priorities are. Our grandmothers may have advised washing a liar’s mouth with soap but that never cleansed the taste of deceit. Telling the truth does that. Besides, I hear soap is full of toxins these days.

Reputation

Here, as in any small town, neighbors lend equipment and help one another out. But if your dealings are unethical folks will remember. That means if you sell wet hay, you won’t have buyers again because everyone knows such hay can sicken livestock or spark a barn fire. Actions demonstrate character.

The same holds true for institutions. When entrusting banks with our accounts we expect a solid reputation. That’s not something an ad can claim, it comes from the bank’s dealings. Our small community banks, like Farmers Savings Bank, didn’t succumb to slick methods of making money the last decade or two. They stayed with traditional banking practices. No surprise, these institutions are strong as ever.

Banks loaning money deceptively, corporations trading without prudence, and individuals taking on excessive debt all knew a time of reckoning would come. It has. The American public is experiencing the disastrous results, and not only job loss and price increases. It’s estimated that one out of four of us owe more on our mortgages than our houses are worth and trillions in retirement savings have evaporated in market “corrections” so far. Hulking fossils like Citigroup and Bank of America have worthless stock and debts exceeding their assets, yet we prolong the date of their extinction with more and more taxpayer money. We’re told that AIG (chomping at another huge government rescue), Wall Street firms and banks took unacceptable, unprecedented risks but ongoing bailouts are essential. Although these behemoths squeezed out other companies by free market rules, now we are told we can’t let them die that way. Their current vegetative state does no one any good. People across the political spectrum are incensed that we are bailing out the same financial giants whose reckless behavior incited our current economic crisis, yet not holding them accountable.

All of us know that those who are not accountable for their actions are, legally, either children or mentally incompetent adults. By that logic, institutions not accountable for their actions should not be in business. Revoke their charters or make taxpayers the new owners. Logic says smaller solid financial institutions that have truly earned decent reputations can replace these lumbering dinosaurs. After all, reputation is all any company truly has to offer.

Self-Reliance and Interdependence

These traits fold together like the Sunday paper. We can’t get along in small towns or anywhere for that matter without relying on one another. When my father was growing up on the farm, each summer a Huber steam tractor puffed down the road, field to field, followed by farmers who worked together for weeks until the land had yielded her harvest. These days we still help one another out through networks of kinship created in neighborhoods, churches and the local diner. We find the more local we keep these ties the more we remain connected to one another and the outcome.

The same holds true financially. When we keep our financial dealings local and reliant on those we trust we remain in greater control of the results. An Austin, Texas study found that for every $100 a shopper spent at a chain store the local economic impact was only $13. The rest of the money headed straight out of town. But spent at a locally owned retailer, the nearby economy benefited from $45 of that $100.

How does this have anything to do with the state of our national economy? We have little control over our money, as a nation, when we are not reasonably in charge of how it’s spent or where it’s going. There’s little transparency, no proven long-term cap on savings and absolutely no voter input when our more and more government functions are privatized.

Take the military as an example. We’re relentlessly privatizing the military. Major U.S. defense contractor Lockheed Martin fails to adhere to military guidelines on major weapons programs, overwhelming us with cost overruns. Yet we pay Lockheed to run our VA benefits claims appeals program and provide civilian interrogators at Abu Ghraib. They’re not doing a great job at either one.

Halliburton, recipient of billions of dollars in no-bid Pentagon contracts, moved its headquarters to the country of Dubai. Its affiliate military contractor, Kellogg Brown & Root (KBR), increases profits by overspending due to lucrative ‘cost-plus” contracts with the U.S. military. Meanwhile, employees of KBR are hired as contractors through a shell company in the Cayman Islands. Then these workers head off to Iraq or Afghanistan to take jobs our service men and women used to handle.

This may be small town thinking, but I don’t recall previous wars being privatized or outsourced. Back then Americans served their country directly under government leadership. Many others worked to manufacture the necessary food, clothing and weaponry for companies based here in the U.S. Maybe that’s why wartime boosted the economy, just as keeping the dollars local in Austin benefited more than the shop owners.

Hard Work

It’s common to hear tractors running well after dark around here because many farmers have full time jobs in addition to agriculture. Their work generates the food that sustains a nation. Still, farmers have to auction off their herds or leave the land altogether when they can’t make ends meet. It’s estimated that 330 family farms are lost every week. That’s tragic for all of us.

Americans are hard workers. We put in longer hours and have fewer paid vacation days than most industrialized nations. Worker productivity remains high. But real wages are down and for those of us dealing with unemployment, the remaining jobs out there pay less and provide fewer benefits than they did a few years ago. When hard work no longer equals a living wage, it’s as if the ground cannot yield food.

Recent figures show that U.S. incomes in the lower 90 percent of the economic ladder went down slightly while the top one percent saw gains of at least 14 percent. And 14 percent of a millionaire’s worth is a lot of money.

It seems hard work is no longer tied to earnings. CEO’s go from one high paying position to another. No matter if they’re leaving a company in shambles, they stroll off with giant bonuses and perks. And the same financiers and economic experts who led institutions to ruin appear are handling the trillions in bailout money. That doesn’t sit well here in the heartland. I can’t imagine it goes over well anywhere.

 

Those who imply that residents of small towns are somehow more authentically American don’t fool us. We’re all Americans. The values we believe in may be too numerous to list but we know they only come alive when we live them each day. That doesn’t mean we always behave well. We’re angry and we do have pitchforks.

sources

” Family Farms” Sustainable Table blog  (loss of farms per week)

“US Lockheed Faulted for Failure to Control Costs” by Dana Hedgpeth Washington Post Wednesday, June 4, 2008; Page D01

“Thousands of veterans may have been denied payments, Kucinich report says” by Stephen Koff The Plain Dealer July 15, 2008 11:56AM  (Lockheed handling VA claims)

“Economic Impact Analysis: A Case Study Local Merchants vs Chain Retailers by Civic Economics”  December 2002     (Austin TX study)

“Cuyahoga County predatory-lending epidemic was early sign U.S. financial crisis loomed”  by Teresa Dixon Murray and Mark Gillispie   The Plain Dealer Wednesday, October 01, 2008

“Predatory Lenders’ Partner in Crime: How the Bush Administration Stopped the States From Stepping In to Help Consumers”  by Eliot Spitzer  Washington Post Thursday, February 14, 2008; Page A25