The "Glocal" economy

Like the beer commercials where one side shouted, "Tastes Great!" and the other "Less Filling!" -- most political "debates" exclude agreement. So it is with the debate between "Go Global!" and "Buy Local."

The Global Economy is not going to go away. For the last five hundred years, world trade has been growing and it isn't going to go away. But it isn't going to continue growing at the blistering (and reckless rate) of the past decade.

That provides an opportunity for local business, local products and local investment. For a while, cheap energy made it possible to hunt out cheap labor and undervalued raw materials almost anywhere on the planet. But that unsustainable binge is now in the hangover stage -- and we are all making resolutions to be a little more responsible about what we consume.

The obvious centerpiece of this is food. Kids growing up in America are the first generation in history not to know there is such a thing as seasons. Fresh fruits and vegetables are now available year-round by air freight. But it isn't just the calendar that's been conquered -- on a day when you can get fresh strawberries from Oxnard at our local Farmer's Market, if you go to Vons, they've been shipped nearly 400 miles from the Monterey Peninsula. For a huge supermarket chain like Safeway (which owns Vons), it's cheaper to buy in huge quantities for all stores nationwide than to try to look for local (or even regional) sources for your stores. Of course, the real costs of shipping fruit you pop in your mouth four hundred miles are missing from Safeway's bottom line. These include loss of freshness, dependence on foreign oil, costly road repairs, increased carbon emissions and air pollution, not to mention the missed opportunity of our dollars going to local farmers and distributors, who in turn spend that money in the local economy, enriching us all. For a long time, global economies of scale trumped both the shipping costs and the insidious toll on our health, environment and local economies.

So comes the movement to "eat local!" for the health, environmental and economic benefits. Will Ventura consumers stop buying Chilean apples in the summer? Probably not entirely. But if they start eating more Fillmore oranges instead, we might see the beginnings of a fundamental rebalancing of where our consumer dollars go.

It's a hard sell to ask today's stretched consumers to pay more for local product or to patronize local businesses. Some do, otherwise the lady that sells little $12 bottles of olive oil at the Ventura Farmer's Market would be out of business. But while such "luxury" (or "quality") choices wouldn't be nearly as expensive if two things changed: if the hidden costs of sending olive oil around the world were reflected in the price at the supermarket and if more local consumers bought locally, giving local businesses more of the benefits of "economy of scale." To stick with the olive oil lady -- her costs of driving her truck from her farm and renting a booth are the same whether she sells ten bottles or 100. While those aren't her only costs, the principle holds that if she sold 100 instead of 10 each Saturday, she could charge less than $12 a bottle. And the lower the price, the easier it would be for her to sell more . . . and so on.

Will those things change? The price of energy will -- as the global economy recovers, rising demand will send prices back skyward. The price of carbon emissions may also be on the rise if the world's squabbling nations find a shared path to curb the rise in global temperatures. The big question is: will consumers change? Will we start shifting our dollars away from (currently) cheap products from far away toward more locally sourced ones? Will we spend more money in locally-owned businesses -- and less in chain stores or online? That is a harder question.

What do you think?