Read Financing Our Foodshed Online
Authors: Carol Peppe Hewitt
Financing Our Foodshed (20 page)
“I think it’s a real shame our bankers are selling off all these loans,” one lender told me. And he described his disenchantment with a retirement account that gave him no direct control over how his money was spent. He finds that frustrating. “People who ran
banks used to loan to people they knew. Now they just pass the loans down the line to get traded. We need a way back to a more honest financial system. I hope this [Slow Money] really takes off.”
What about the risk? How did that inform lenders’ decisions about making Slow Money loans?
One of the five lenders who helped TS Designs with their organic cotton project (described in
Chapter 10
) said:
I know the people well who own the business, and I have a lot of respect for what they are doing. They are well established in the community, and I’m comfortable lending them this money. Their project is incredibly exciting, and I had money available that I didn’t need at the time. I had been looking for an opportunity to reinvest the money that I got back from a previous investment, and keep it going.
Jane Norton, who loaned Alice money to start Girl Honey (see
Chapter 10
) said about the risk: “My commitment to supporting local businesses outweighed any concerns about the risks of a personal loan.”
Gary Simpson’s relationship with Angelina played a big part in his decision to lend (he helped pay for a replacement cooler for her restaurant, See
Chapter 4
):
I have great respect for Angelina. She has demonstrated her commitment to a local sustainability ethos, shares my land ethic and will continue to invest her heart, mind, soul, skills and monetary resources toward the betterment of the community (commons) at large. Her business benefits both the consumer, with healthy and savory food, and the local producers of that food grown with TLC. In a world and at a time when so much of the quality of life we have come to know is in peril and we are losing battles on so many fronts, I want to be a part of “win-win” opportunities. This is such an opportunity to help build a more resilient and sustainable future,
promote goodwill and good stewardship while celebrating the abundance of life rather than seeing the world through a lens of draconian austerity.
My parents had little to nothing to risk, monetarily speaking. They knew nothing of investing beyond what the local bank had to offer in savings accounts and certificates of deposit. When my mom died, my dad didn’t know how to write a check. When he died, my brother and I split a small inheritance, the price the old house sold for. I’ve never considered myself a risk taker; far from it. My upbringing and personality type leave me motoring through life in the slow lane and under the caution flag. I’m not likely to become a bungee jumper, hang glider, or zip liner either.
Slow Money is just the right speed for me. I can invest locally to assist deserving neighbors who are living out the values that I share. I am not enamored by high finance, but believe strongly in the principle of neighbor helping neighbor in as many ways as possible. Local grassroots financing with low-interest loans is an appealing path to follow, and a win-win for everyone as we keep our money “down to earth.”
Like Gary, Seth Moser-Katz finds Slow Money aligns with his thinking about what is needed for our crumbling financial system:
My parents always encouraged investing. This took the form of stocks and mutual funds and a money market account at the bank. I was never concerned about where the money was going. The simple fact that the interest rate was outpacing inflation was enough. The bank bailouts in 2008 made me think about where my dollars were being used, and I realized that I really had no idea. I set out to educate myself a bit. I learned about corruption in government and discovered that most of it stemmed from large corporate dollars being
injected into the political system. I learned that much of the state-sponsored violence around the world was funded by the very same corporations in which I owned stock and bonds. I learned that the capitalistic model is not the only correct way of thinking about the economy. Contrary to what I had thought, the paradigm of growth/consumerism, touted as gospel by every television advertisement, is not sustainable and really does not make you happy.
Being public about making a Slow Money loan is completely at the discretion of the lender. Most of us were taught that it is rude to talk about money — how much you make or how much you have. So, we keep that information confidential. But a culture of obscuring the truth about the flow of money in our society has gotten us into the financial mess we are in. Being transparent about the flow of Slow Money is one way to change that.
“I talk about my Slow Money loan all the time,” Christy Shi told me. She was one of the five lenders that helped TS Designs pay for the first crop of organic cotton ever grown in North Carolina. “I’m so proud to be able to a support locally owned business in such a meaningful way. I’m really glad to be able to fill a niche that would otherwise go unfilled.”
“Until yesterday, I had not talked with anyone about it,” one lender said. “But I decided to tell a few friends to see how they would respond. It actually felt good to talk about it and encouraged a discussion about money that was healthy for all of us. Now they’re interested and curious to learn more.”
“To borrow the opening line of an old spiritual, ‘Go, tell it on the mountain!’” Gary Simpson answered when I asked if he would prefer to remain anonymous about his Slow Money loan. “I am elated that I have been able to make such a loan, and would be pleased to have
anyone know that I’ve pulled it off. I am by most standards and by my own admission an unlikely candidate to be bankrolling anyone’s business venture. I’m all about sharing the good news.”
Seth was wide open. “I have no problem with people knowing about small money loans that I make. I think that if more people knew and understood the power of money moving in a community, there would be more of these loans.” I think he’s right.
Lenders reported getting a variety of responses when discussing their Slow Money loans:
Usually they’re really curious, and sometimes jealous!
The first two people I told about this new adventure seemed pleased to hear the news. That’s the reaction I expect from anyone who hears the story, and why not? It’s a pleasant diversion from a “business as usual” and “winner take all” climate where greed too often trumps gratitude and profit is the final word on the bottom line.
Sometimes it’s “Oh, that sounds cool!” But the reaction is mixed really. There are the nay-sayers who say “Wow, you’re taking a chance,” but others, happily, understand the importance of local money staying local.
This comment, from Ginger, makes me laugh out loud:
Most people think it is a great idea. A few shake their heads — but in general, we don’t tell people who shake their heads.
I have made several loans now, myself, and I’ve told my story again and again. Each month as the checks arrive they remind me of the admiration and gratitude I have for these industrious entrepreneurs. In fact, I have so enjoyed making Slow Money loans and my connections to these great people that I just might write a book about them.
A few lenders have been on the other side of the financing fence; they say that the experience made a difference in their deciding to help someone else. I know it makes a difference for me. I’ve been on the other side of the fence myself.
Thirty years ago, my husband, Mark, and I moved to Pittsboro, NC to start a business. I had a student loan, no savings, and no job, and neither did he. Mark got busy building a wood kiln and retrofitting a chicken house into a pottery workshop, which didn’t leave him time to be otherwise gainfully employed. I started working right away, but my pay wasn’t enough to live on
and
start a pottery workshop. Thankfully, we were able to borrow $15,000 at 12% interest from a family member. That loan paid for the kiln bricks, kiln shed, and some basic equipment. We paid it back in monthly installments for years — but it was worth it. With no collateral, and only my meager starting salary, no bank would have given us a penny. Without that loan, I don’t know how we would ever have gotten our business started. At the very least, it would have taken us much longer.
Now, with the business well established and two kids finished with college, it’s nice to be able to pay it forward — to move to the other side of the lending fence and help small business entrepreneurs who need capital just like we did. The banks aren’t going to make these loans. So, a lot of talented, passionate, hard-working folks are stuck.
Giles Blunden, the Slow Money lender who helped a farmer buy a skid steer, also knows what it’s like to need a loan the bank won’t give. “We have been fortunate in the past to have friends who were willing to loan us money for a short-term business loan. We know how good it felt to have that support and how we felt very strongly about paying them back.”
Similar experience motivates lender Christy Shi as well:
When we started Know Your Farms we needed a refrigerated truck to carry products from local growers into the city. We
couldn’t find any loans because we were a new company without a credit history. We couldn’t get any grants because we were a for-profit business.
We hobbled along, renting refrigerated trucks two days a week. We were so small, we couldn’t secure a reservation, and in the middle of summer, we sometimes found ourselves without a refrigeration option due to other folks renting the trucks ahead of us. We were under-capitalized, so we couldn’t scale up our rental agreement to guarantee access to a truck. We couldn’t afford to buy a good working truck.
Then, a farmer who had come into some money approached us. She wanted to invest her money in her community and asked if we had any need of a loan. We jumped at the chance. It wasn’t an extremely low-interest loan, but the opportunity to have that capital made it possible for the business to survive... We are so grateful to someone putting their personal stake in us and filling a need we could find no other way to fill. Because of this personal experience, I deeply appreciate the value of Slow Money and its principles.
I asked some lenders if they would ever make another loan. It was heartening to find that most folks said yes.
“Absolutely... I would rather have my money with people I know.”
“Bring it on.”
A few said no, though they often added “not right now,” “I just bought a house,” or “I want to make another loan when this one is paid off.”
Seth looked at the future when crafting his response:
When the right project comes around and I have available funding, there is a good chance that I will make another loan. As we have seen already in Europe, the current models of economics are not going to stick around. Institutional failures
will lead to panic and disorder and as humanity struggles to rethink monetary interactions and what it takes to be happy, new paradigms of normal will emerge. Programs such as Slow Money will provide shining examples of locally funded initiates and lead to a plethora of similar “slow” projects. It’s only a matter of time.
I asked a few Slow Money lenders if they had other thoughts about Slow Money.
Gary Simpson replied:
The admonitions of old Polonius to his hothead son, Laertes, have been replaying in my mind: “Neither a borrower nor a lender be.” Bad advice, I’m thinking. Polonius’s aphorism calls for caution, lest one risk loss of both money and friendship. If Shakespeare lived today in sunny Chatham County, NC, rather than 17th-century foggy old London town, he might be writing a different story. Perhaps he’d see the light that the Slow Money movement shines on the potential for gain rather than loss; the friendship/community building and symbiotic relationship-producing aspect of neighbor reaching out to neighbor in good will for the benefit of all.
Shakespeare was right that, “All the world’s a stage, and all the men and women merely players.” We have choices in the roles that we play as we traverse the stage from scene to scene and act to act. The role that Money plays in our understanding of the plot and the manner in which it directs our lines and movement will greatly influence how the play unfolds and ends.
Slow Money serves as a foil to the greedy, miserly, self-serving and all-consuming characteristics of human nature... Slow Money advocates for neighbors to audition for roles of borrowers and lenders [and] provides a script that facilitates happy endings for all and celebrates the miracle of abundance... each time we take the stage.
Seth has taken his concern for the future a step further:
In talking to one of my friends who also had an interest in what happens to money when you drop it off at the bank... We had so many conversations and discussions about this topic that we decided that we needed to start recording them and put them out for others to listen to and think about. One thing led to another and The Extraenvironmentalist was born (
extraenvironmentalist.com
)... The show comes from the perspective of an outsider recently arrived on the earth, with no prior knowledge or cultural programming who asks why do we do the things we do? Why do we hurt one another and strive to rule each other? Why do we wrap ourselves in complicated monetary systems and create business organizations that disregard the humans it must exploit? The ideas and topics we talk about are not anything new, but they are often ignored by mainstream media sources.
Using this viewpoint of an outsider, we have begun to dissect complicated ideas surrounding what it means to be a human at the beginning of the 21st century and what the future holds in store.
[We] often land at the conclusion that civilization on the current scale is not sustainable. The historic model of human interaction has always been in small groups, where goods and services are traded between neighbors and supported by local infrastructure. Knowing where your money is going, where your food is coming from and why it’s important to keep it local leads to a mindset in which the corporate model of exploitation becomes untenable. When business as usual becomes less about cheap goods from a third-world country on the other side of the world and more about the maintenance of human welfare.
When humans can view themselves not through the lens of nationalism, or capitalism but as brothers
and sisters, united on this floating blue ball we call Earth, then the Slow Money initiative will have achieved.