The Hazards of Shopping Locally

Recently, these signs went up in the neighborhood, warning of ATM Skimming:


Click the image to enlarge

They’re on just about every lamppost, in some areas.

When EV Grieve posted something today (7/19) about the signs, in a short time commenters were complaining about this happening to them, at local stores!

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local-stores-skimming-0719-2011

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Mom! Pop! What about the community?!

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Back in May:

    Governor Andrew M. Cuomo … announced the initial results of the State Liquor Authority’s (SLA) effort to combat underage drinking in New York City utilizing a part-time investigative unit. Starting on April 17, 2014, the unit made 74 visits to licensed grocery and liquor stores in all five boroughs of NYC, with 32 sales to minors.

The Manhattan stores were all in the “East Village”:

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Click the image to read the press release

Mom and Pop strike again!

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East Village Community Coalition

There is an organization in the “East Village” called the East Village Community Coalition. I don’t know how long they’ve been around, but a whois search shows their web site was created on 08-Jun-2004, so it’s probably safe to assume they came into being some time around then.

They’re pretty secretive, too. Their registrant, admin, and tech contacts are masked. But that’s not why I’m writing about them. I want to discuss their
Guide to East Village Local Shops.

This is from their web site:

evcc-shopping-guide

Point by point:

Choose creativity and personality over uniformity – If you shop in one place because you like the color of the paint, or don’t shop in another because you don’t like the awning, it’s all the same. Besides, many local shops show neither creativity nor personality, and uniformity, in itself, is not a bad thing. And there are plenty of chain stores that vary their appearance. I suspect there will be more of this in the future, as they try to meet the demand for this type of “creativity and personality”.

Provide economic diversity and stability – It makes no sense to speak of “economic diversity” within such a small area. A country might have economic diversity, even a city, but when you break it down to ever-smaller localities, like neighborhoods, you can’t maintain this. It makes no sense, under any mode of production, to have manufacturing, distribution, retail, finance, agriculture, etc., all in one square block.

I doubt that the EVCC really expects manufacturing or agriculture to exist here. They understand the division of labor. They’re talking about retail only, which means that they want to take the level of productive forces as they’re given, and freeze them there.

Keep more of your money in your community – Does shopping locally keep money within the community? Leaving aside for now what “the community” really is, let’s set the boundaries as Houston Street on the South, 14th Street on the North, the East River on the East, and Third Avenue on the West. Imagine this is a closed system, with no money coming in and no money going out. (If the “East Village” were actually isolated from the rest of the global economy, it would die off in no time. Still, for the sake of argument, let’s imagine this.)

All value, in the capitalist sense, is created within this closed system. No money/resources/people come in or go out, and everything functions under the capitalist mode of production. People go to work and make commodities that are sold only inside these boundaries – wages to the workers, profits to the owners. Right away you can see, in a very short time, there would be a crisis of overproduction. Assuming everyone can buy one of everything produced on their wages, once they have what they need they won’t need more. The producers would have to look outside these boundaries to sell their wares, and the local paradigm is demolished. This is essentially the national economy, reduced to the area described above.

And what about the surplus population? There are not enough jobs provided by the local businesses in the “East Village” for everyone who lives here. People will have to emigrate to other neighborhoods and send money back home. Which is, of course, what actually happens. Almost no one who lives in this geographical area works here. While the EVCC tells us to keep the money in the neighborhood, they couldn’t survive without its coming from outside the neighborhood.

Which is a good thing, because it’s the retailers themselves who are sending the money out! Since there is no manufacturing or agriculture here, local retailers sell commodities manufactured somewhere else, or with raw materials originating somewhere else, whether it’s tchotchkes at Alphabets or coffee at Mud.

The first section of EVCC’s Guide is Cafes. Cafe types, and some of their non-local ingredients, are:

Cafe Type Imports
Bakeries Butter, Flour, Sugar
Cafes Coffee
Candy & Chocolate Chocolate, Sugar
Ice Cream Eggs, Milk, Sugar, Vanilla
Juice Bar Fruits, Vegetables
Tea Shop Honey, Sugar, Tea

 
The next section is Fashion. Most of the retailers don’t make what they sell: Dinosaur Hill, Jane’s Exchange, Village Kids Footwear, etc. It’s possible that some others do, but they don’t make the sewing machines or material or thread. The other categories are: Galleries; Gifts; Florist; Health and Beauty; Culture, Music, Entertainment; and Specialty Services. It’s the same with all of them.

Create local jobs with fair living wages – The U.S. Bureau of Labor Statistics (BLS) shows little variation in pay for professionals and managers by establishment size, but differentials widen as you move down the status hierarchy. Data entry clerks in small establishments earned 7% below the national average, while those in large firms earned 20% above. Gaps for janitors were wider, and those for laborers were wider still.

This fact persists regardless of occupation, industrial sector, education, experience, geographical location, union status. Workers in larger firms are more likely to be covered by company-paid health insurance and have some type of retirement plan. Also, worker safety is worse in small businesses — “Size and risk are inversely correlated at all levels of scale,” according to an International Labour Organization report.1

Sustain small business owners who strengthen the local economy – Redundant.

People who make the claims made by EVCC like to point to studies that show how much money stays in the community with small business than with larger businesses. One study conducted in Chicago found that for every $100 spent by customers, $43 stayed in the area for chains, while $68 stayed in the area for non-chains. One problem with this is that the geographical boundaries were the entire city of Chicago, so money that moved from a poor neighborhood to a richer neighborhood was still considered to be “local”. Likewise with the “East Village”. Many of the owners/workers do not live here. The money they make leaves the neighborhood daily.

A bigger problem is that this is only a measure of profits. For the chain, some part of the profits, or even gross revenue, is sent to the corporate office, leaving the manager with less to spend than the owner, but this assumes that the owners spend all their profits. Owners reinvest profits, or they use them to pay their more-expensive mortgages or vacations or restaurant bills. The argument ultimately centers on filling the capitalist class’s luxury-goods market, something that doesn’t even exist in the “East Village”.

Defend our neighborhood’s identity – Is the neighborhood’s identity really defined by its retail shops? This is definitely a petite-bourgeois perspective! Anyway, this neighborhood’s identity was defined by the real estate industry, not the retail industry. The term “East Village” was coined by real estate developers in the 1960s as a way to attract renters, by linking the area above Houston Street with Greenwich Village, and disassociating it from the Lower East Side’s immigrant, working-class roots.

Fight the lie that “low prices” at chain stores makes up for the loss of local business ownership – Low prices benefit workers, local business ownership benefits owners. Welcome to the class struggle.

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A few things about small businesses that I’ve written about before, but which bear repeating:

Unemployment Insurance – If employees are paid in cash, there is no record of their employment, making it impossible for them to collect unemployment when they lose their job.

OSHA Requirements – If a company has fewer than 25 employees, their penalty is cut by 60 percent. If the business has fewer than 10 employees, they’re exempt from many requirements that obligate them to report workplace injuries.

Discrimination Laws – Federal laws against discrimination in the workplace do not always apply to small businesses. Title VII of the Civil Rights Act of 1964 and Title I of the Americans with Disabilities Act apply to employers with 15 or more employees. The Age Discrimination in Employment Act applies only to employers of 20 or more people.

Employee Health Insurance – Beginning in 2014, employers will be expected to pay a “shared responsibility fee” for health insurance coverage under the terms of the Affordable Care Act. Small businesses are exempt from this rule. If the company has fewer than 50 employees, they have no healthcare responsibilities.2

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1The Small Business Myth
2Small Business Exemptions

Localist Moralism: The Locavore

When localists aren’t listened to, consumers change from being the solution to being the problem. Barbara Kingsolver is scathing about the food decisions of poor people: “we complain about the high price of organic meats and vegetables that might send back more than three nickels per buck to the farmers.” Meanwhile, “if many of us would view this style of eating (local food) as deprivation, that’s only because we’ve grown accustomed to the botanically outrageous condition of having everything, always.” She recognizes that consumption rises to deal with stress of working lives, but “much of it simply buys the services that make it possible for us to work those long hours.” The capitalist imperative to increase productivity turns into its opposite, a personal choice of workers themselves.

A concrete example of localist moralism is food politics. The petite bourgeoisie’s judgments on food stem directly from its habitus.

Food choices are a consequence and not a determinant of class. Thus it is possible to deduce popular tastes for the foods that are simultaneously most ‘filling’ and most economical from the necessity of reproducing labor power at the lowest cost which is forced on the proletariat as its very definition.

Ignorance of this relationship confounds the locavores. The compulsion of wage-labor makes taste “a forced choice, produced by conditions of existence which rule out all alternatives as mere daydreams and leave no choice but the taste for the necessary.” Failure to grasp this forced choice allows localists to pose a moral one.

Commodity fetishism, the basis for habitus and its choices, gets erased in favor of a nebulous and ever-present culture, morality and laziness. Food localism becomes the latest sign of “class racism” against the ‘sheeple’ who are too brainwashed to know what’s good for them. There is no difference between criticizing an unhealthy diet and criticizing one that doesn’t come from the proper, local place. In fact, local food is even further from the taste of necessity, since it’s a moral obligation to taste and the environment, not just to one’s own health.

Pierre Bourdieu suggests that the petite bourgeois get disillusioned as “they grow older and as the future which made sense of their sacrifice turns sour.” There’s no impugning the motives of the petite bourgeoisie: their personal sacrifice, creating schemes that are supposed to grow, comes at great emotional cost. The next step of looking for someone to blame seems only natural, and what better target is there than the poor and the working class, who for some strange reason continue to shop at Wal-Mart and eat at McDonald’s?

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Greg Sharzer, No Local: Why Small-Scale Alternatives Won’t Change The World (Winchester, UK: Zero Books, 2012), 113-119.

Ethical Consumption

Despite the problems I described in Consumers in Capitalism,

wages are the focus for all pro-market localist schemes. If consumers buy locally-sourced goods from ethical sellers, it is claimed, they’ll shrink the economy to a more rational sustainable level.

It’s true that the West consumes too much; people buy what they don’t need or too much of what they do need. Businesses spend vast amounts of money to convince people that their lives are incomplete without the latest gadget. People who reject this oftentimes get drawn into their own form of elitism, paying huge sums for the coffee and gadgets that define their counter-cultural cachet.

Localists frame this by aggregating individual consumption choices. It’s assumed that we’ve all chosen, on our own, to consume too much, and this individualism marks localist thinking. Individual choices, it’s said, put together, will change the system. Making numerous small choices will add up to changing big ones. Consumers can change not only their spending habits but entire industries. Michael Shuman names ten different areas shoppers could buy locally, imagining a consumer-led panacea of local business, finance and technology to bring the community together “to envision a better economic future for all of its members.”

But capitalism does a lot more than offer different products for people to buy. The market coordinates production globally, which makes it very hard to reproduce in miniature. For example, localists acknowledge that the quality of local food isn’t consistent. It’s hard to get and often costs more, both because of economies of scale and because its production and distribution aren’t subsidized. Consumers are supposed to compensate for this by paying more.

The problem is that the capitalist economy is too complex for individuals to change at a micro level. But rather than democratically plan the economy, allowing social need and not profit to dictate what gets made and how, consumers are supposed to refuse to “give in” and cope individually with market anarchy.

If ethical consumption relies on consumer preferences, then consumers can equally choose not to participate. In a system where consumers are workers with nothing to sell except their labor power, it’s rational to buy goods as cheaply as possible. And this is what happens when capitalism goes into crisis.

Still, ethical consumption remains popular: after all, it’s a way to feel you’re changing the world by spending a little extra. But the question is whether it’s actually changing the production and distribution circuits of capital. At what point will the number of ethical consumers peak, when those with no disposable income can’t participate? And, since it can’t change the global drive to reduce costs below the average global price, what distinguishes ethical consumption from charity, a way to salve the consciences of the well-to-do, leaving the structures creating inequality intact and growing?

The assumption behind consumer activism is that we’re limited to shopping to express our discontent. This is effectively saying the neoclassical economists are correct: the economy runs on consumer preferences, not exploitation. This shifts blame onto individual consumers for the failings of the system: if there’s alienation and environmental misery, it’s your fault for buying the wrong things. Yet consumers are also workers who must sell their labor power or lose their livelihoods. They buy what makes their wages stretch further.

In fact, the vast majority of people in the world need to consume more; capitalism isn’t meeting their needs. Billions of people live on less than $2 a day. In this context, calling for people to consume less misses the point. Real ethical consumption is collective. Capitalism makes it impossible for most people to meet their needs on their own, but as a society, we could provide houses, hospitals and schools for everyone. Obviously, this implies a vast change in the structure of ownership and consumption, but it’s a far more positive vision than localism’s individualism.

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Greg Sharzer, No Local: Why Small-Scale Alternatives Won’t Change The World (Winchester, UK: Zero Books, 2012), 33-38.

Pro-Market Localism

Localism has developed into many different streams which can be roughly grouped into localists who support capitalism and those who want to overcome it. Pro-market localists suggest that market regulation can create ethical local capitalism. Some build small businesses, while others promote non-profits and cooperatives. Locally-owned businesses are supposed to keep money in the local communities and, since they’re small, treat workers and the environment better.

Pro-market localists say that if the economy is just a collection of use-values, then we can make capitalism better by producing fewer, high-quality goods. Markets are good things and they can be regulated, providing they are operated according to principles of social justice. The answer is to make the economy less efficient.

They also claim the small scale of local business makes it more ethical. Big business separates owners from those who work and consume; bring them together, the localists say, and business will be more personal. In these circumstances, labor exploitation no longer matters: “even autocratic control is no serious problem in a small-scale enterprise which, led by a working proprietor, has almost a family character.” As long as the business is small, “private ownership is natural, fruitful, and just.” Capitalism is fair as long as it’s done correctly. Profit can be made optional by caring about the proper, local size.

This points to a key confusion at the heart of localism: it conflates the size of ownership with the size of production. The two are very different: while larger production needs concentrations of machinery and labor power, larger ownership doesn’t. Confusing facilities with ownership allows localists to echo Adam Smith’s promotion of small, equal capitals. Opposed to a capitalism controlled by monopolies, Smith believed that markets could be self-regulating and competitive if producers and consumers were kept small. Smith had the benefit of describing his own historical period: during the 18th century, small companies battled it out to control local markets. Not today: small business is less important to directing economic activity.

Idealizing small business is simply a form of nostalgia for earlier forms of capitalism, which weren’t necessarily any better. Small, family-owned businesses also pay poor wages, price-gouge customers, and destroy the environment. As of 2010, U.S. small business owners were 83% white, married, older men. That figure shrank only 4% from 2000. This means that the small business culture localists defend is also fairly exclusive.

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Greg Sharzer, No Local: Why Small-Scale Alternatives Won’t Change The World (Winchester, UK: Zero Books, 2012), 20-23, 29.

Localism and Community

[F]aced with the unpalatable conclusion that small alternatives won’t out-compete or destroy capitalism, localists cling to a fierce faith in communities to band together and do it yourself.

Localists yearn for community, freed from the uniform mediocrity of anonymous, corporate-controlled spaces. However, the petite bourgeoisie’s way of life precludes a community, since members of the class rely mainly on themselves for economic progress and emotional support. Community members are either fellow petite bourgeois competitors or customers demanding lower prices. Perhaps this is why so many localists have such a strong nostalgia for community as an ideal place where business happens and values take shape. Farmers markets aren’t just a place to shop, but a place to socialize: since “consumers have ten times as many conversations at farmers’ markets as the do at supermarkets… You go from being a mere consumer to being a participant.”

Why do localists want their shopping trips to include personal conversation? Alternately, you could appreciate the anonymity and speed of supermarket transaction if you have other ways to socialize. But it makes sense that the petite bourgeois, trying desperately to succeed in the marketplace or gain control on their own merits, would feel lonely. They try to re-forge the social connections lost in the marketplace in the same individual way they advance. Consumption is where they compete to achieve the symbols of habitus. The desire for friendly consumption is as close as the petite bourgeois get to stepping outside their daily antagonisms.

Just as ideology is a single class’s way of life generalized to all of society, community for the petite bourgeois becomes community for them alone. Wendell Berry criticizes corporations, governments and schools for concealing a “private aim (which) has been to reduce radically the number of people who, by the measure of our historical ideals, might be thought successful: the self-employed, the owners of small businesses or small usable properties, those who work at home.” This persecution of petty capitalists sets local community advocates against “Communists and capitalists (who) are alike in their contempt for country people, country life, and country places. They have exploited the countryside with equal greed and disregard.” The local community are “small farmers, ranchers, and market gardeners; worried consumers; owners and employees of small businesses; self-employed people; religious people; and conservationists.”

The inference is clear: the working class isn’t part of the community. [Emphasis mine.] The images are of the town square, the main street where everyone knows your name, the butcher, baker and small shopkeeper. These evoke market towns where residents distributed commodities made elsewhere. In contrast, industrial towns were often centers of intense class struggle between owners and workers. Not coincidentally, industrial towns created close community networks forged in that struggle. These close-knit communities of workers also demonstrated all the values of collective self-sacrifice, yet localists never mention them, preferring fuzzy invocations of consumerist fantasy.

The problem lies in how malleable the term community is, including capital, the state, and workers — groups whose interests are fundamentally at odds. By suggesting workers are at most another group making demands on the state, the designation of community hides power relations. It replaces class with innumerable differences of income, culture and other sociological categories, bounded by geography rather than a common exploitation. This blurring of conflict is fundamental to localism. By invoking community, localism attempts the political equivalent of Proudhon’s fair markets for small artisans, imposing a false social peace by eliminating the working class rhetorically.

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Greg Sharzer, No Local: Why Small-Scale Alternatives Won’t Change The World (Winchester, UK: Zero Books, 2012), 98–101.