Buying Local - Lessons from Tenino, WA, Colorado, and France

We have to be careful about how we spend our money. Money is the lifeblood of our economy and where it is flowing says a lot about the health or our financial system. Right now, it is flowing to fewer and fewer business and companies. 

Just take the recent government stimulus that was a response to the COVID-19 pandemic. There is a reason that technology companies all moved to new all time high valuations. The system is currently plumbed to have a good portion of that money flow right to them.

Whether it is people shifting their household purchasing to Amazon, or buying the latest Apple or Android (Google) phone, or spending more time and advertising on Facebook, Instagram (Facebook), and YouTube (Google), or companies needing Amazon and Microsoft for cloud services to run their growing online businesses, this money will funnel its way to them. In addition, newly minted investors have put some of their stimulus money into the stock market to buy these very stocks, which has caused their valuations to increase. 

We don't need to sit back and let this happen. There are things that can be done to protect local businesses. I'd like to highlight three examples that I've come across where local government, state government, and even national government are creating ways to make money flow to small business and out of the hands of big business.

The first example is the town of Tenino, WA with population of 2,000. They are taking a different approach to making sure their stimulus money from COVID stays local. They earmarked $10,000 in their budget for stimulus, but instead of giving that $10,000 in the form of U.S. Dollars to residents, they printed their own money that can only be spent in the town of Tenino. This way the money has to be spent on local small businesses and not go outside of town to Amazon, Apple, or even the stock market. Learn more from this CNN article.

The second example is Colorado with its alcohol industry. Colorado only allows one retail liquor license per individual/company. So that means every liquor license in the state has to be owned by someone different. And that also means there is only one Safeway in the state that can sell alcohol, one Costco, one Whole Foods, one Target, etc. I live in Colorado and don't mind it at all because I know this is making for a healthy, local economy. They did recently allow all grocery stores to sell beer, but wine and spirits are still protected in this fashion. Learn more from this ColoradoBiz article.

The last example is with France and its book industry. To make it so Amazon couldn't run the bookstores out of business, they required Amazon to charge for delivery and to only discount the books by a maximum of 5%. This made it so bookstores could stay competitive on price and again make for a healthy, local economy. Learn more from this NY Times article.

Big business is like a cancer where it can just grow and grow, and, when left unchecked, can overtake the economy. This is especially true with technology companies where it is nearly impossible to start a competitor to any of the powerhouses. The only way to do it is to force money/blood flow away from them and into other parts to the economy to make for a better functioning, more resilient financial system. Let's work with government to create and experiment with ways to do this. And please be smart yourself about how you spend your money to support local, small business when possible.