Local Economics

With all the talk of the economy in recent years, we have yet to hear someone question why we have an economy in the first place. On the surface, that may seem like a ridiculous question. At the same time, there seems to be a huge disagreement over this very question. Is the purpose of our economy to produce the next billionaire CEO? Is the purpose of our economy to create tax breaks and incentives for multinational corporations? Maybe the purpose of our economy is to reduce the capital gains tax for wealthy investors? Is the purpose of our economy to destroy the middle class? While we don't believe you think these are the purposes for our economy, this is exactly what is happening.

Even the way we measure our economy is flawed. The focus today is on the standard of living rather than the quality of life. 'Standard of living' simply means the amount of money spent on goods and services. For example, we may pay for an elderly parent to stay in a nursing home. In the U.S. economy, this is measured as part of the GNP (gross national product) or the total money spent in the country. If this total number of dollars divided by the number of people in the country goes up, the standard of living is said to have gone up. What happens if the same elderly parent moves into your home instead of the nursing home? In our economic system, the standard of living just went down but what about the quality of life? Quality of life is measured in more than simple monetary terms. Although money has something to do with it, there are other factors of equal or greater importance.

Traditional businesses are focused on the standard of living or selling products and services at any cost. Many sales people and advertisers are trained in deceptive techniques that have been developed to trick people into buying things they don’t need and may not even truly want. In many instances, there is a complete and utter disregard for everything other than the raw value of the sale. While all this selling looks good on paper, it doesn’t make for the greatest quality of life.

What would the world be like if it were based on companies that worked with employees as human beings instead of treating them as cogs in a wheel? What if companies considered the impact of their products on our environment? What if companies gave something back to the communities that support them? What if our society placed a higher value on the quality of life than it did on making the sale? These are some of the questions being addressed by Equanomics as we shift the focus of the marketplace from standard of living to quality of life.

Do you know the difference between a poor community and a wealthy one? It’s not money! Both communities have money. In fact, some of the poorest communities have millions or even billions of dollars. That’s right. Is the person who earns $15,000 per year rich or poor? Picture a community of 100,000 people who each have $10,000 to spend this year. You’re talking about a community with $1 billion dollars of spending power. The poor community has plenty of money. What the poor community lacks is local business ownership, the engine of wealth creation.