Introducing ….. Raybel Charters

I’ve been out of the job and into an improbable new world of sail cargo pioneers for six months now. It’s an enthralling dream of transporting goods by wind-powered ships, some old, some new. An alternative to the mass containerised shipping that is a key feature of the global economy.

The new business is Raybel Charters, and our plan is to carry goods into London, and back out again, along the Thames Estuary, by sailing barge – much as was being done a century ago. But with a modern twist – more craft ale, coffee and sea salt than bricks and hay. We will be the link between sustainable prodcuer and ethical consumer.

We’re keen, as well, to run routes up the east coast of England, to Essex, Suffolk, Norfolk and – getting more ambitious – along the south coast and cross Channel too. In time we want to connect with other routes being opened up by the new breed of sail cargo pioneer: the Avontuur, running across the Atlantic to Montreal, the Carribbean and back; the Tres Hombres and Nordlys, set on their journeys to the Caribbean from Den Helder on the northernmost tip of the Netherlands; the Grayhound, home port Douarnanez, but Cornish built.

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You can see this as romantic and small-scale – miniscule would be closer to the mark given the 50,000 billion tonne miles of freight being hauled around the seas each year in mega containers. So what’s the point?

That environmental issue is the most obvious, for sure. Shipping might be more carbon efficient than air or road travel, but it still spews out 1,000 million tonnes of carbon a year – over 2% of all global human emissions. IWSA-logo-scritta-association.png

That’s twice as much as aviation. Moreover, emissions are predicted to rise by anything between 50% and 250% over the next 50 years, when other sources are set to fall. With shipping still heavily reliant on ‘bunker fuel’ – basically just waste oil – it’s an even worse story on other pollutants like nitrogen oxides and sulphur.In those cases over 10% of global emissions are due to sea freight. It’s easy to feel that small initiatives don’t make a difference – but change happens at the margins, through trials, tests, mad ideas that offer spark and inspiration.

And the ‘old’ technology of wind power is genuinely seen as part of the solution. In a  Lloyd’s List article, 14 experts in the shipping field were asked what would power shipping by 2050. The majority said wind propulsion would be the key development. Certainly some of what is being talked about here is very high tech indeed. Plans for a Dutch eco-liner are coming off the drawing board. Two members of the sail cargo network founded Coriolis Trading plan to raise investment for the middle ground of small to medium size freight ships operating under sail.

But, alongside these new tech developments, and in common with so many issues today, there is much left and inherited from the past that can help in creating a more sustainable future. Whilst the new ideas for modern sail ships can be thought of as putting the industry back to where it might have been, but for the interlude of fossil fuel propulsion, in other cases – the Thames sailing barge, for example – the technology in 1920, when the Raybel was built, can still function perfectly well in the role of estuary and coastal shipping today.

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Sail cargo taps into much else besides. Freight is about making connections, linking buyers and sellers, producers and consumers, communities, nations and continents. There’s the chance here to pioneer a supply chain on a human scale – slow cargo – re-connecting people to products and to the movement of goods at a pace dictated by nature – an antidote to the ‘just in time’, ‘always available’ culture of modern consumption. Indeed some of the staples of this new sail-freighted trade – olive oil, wine – are the same as sea-traded in Roman times: simple essentials of a good life, where trade is necessary as local production isn’t possible.

It’s no surprise that the early products favoured for sail cargo have been food and drink, where the producer-consumer connection is made most easily and meaningfully, where the supply chain can be short, where consuming can be a shared and lived experience. In the case of New Dawn Traders’ recent olive oil shipment, for example, it was just the oil producers – the Reigado family of northern Portugal – and the consumers of the English south coast, linked by a broker/merchant, the ship – Nordlys – and some UK port organisation by Brighton based Sail Boat Project.

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This charts us into questions about the social and economic conditions that connections in modern economies are made under, and how to achieve transition away from a model that cannot continue. How to do that? Where are the nooks and crannies in the transactional money-based economy that we can tease away at, eliding the distinction between relation and transaction, the sharing-economy and the cash-economy? And how does that bump up against regulation, standards, and government bureaucracies – how much freedom do we have to co-ordinate economic exchange between ourselves?

Take the myth of consumer primacy – that the consumer has a right to instant, always available produce, delivered at the utmost convenience – even of seasonal products delivered half way across the world. The myth tells us that no effort is expected of the consumer. But why shouldn’t we be willing participants in the supply chain, at least of some of what we buy? Why not be part of the journey? And if you help to distribute or collect or market a sail cargo product, maybe you get it a bit cheaper. Or maybe just being part of the story.

Merchants and brokers are as key to this scene as ships and sailors. These are the fixers and communicators of this nascent movement (much more my role – I’m no sailor). New Dawn Traders puts cost breakdowns on its imported olive oil, transparently showing the make-up of the retail price and the allocation to farmer, to shipper, to port authority, to tax. By definition, anything cheaper must have come at the cost of exploitation somewhere in that chain, of environment or people.

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We see Raybel Charters having a role, as well, in helping re-connect riverside communities to the Thames, from our planned home mooring of Sittingbourne – a proud shipbuilding and sailing centre now literally cut-off from the river by a bridge that does little more than serve a local Tesco’s – to the new residential developments at Ebbsfleet New Town, Thamesmead and the Royal Docks.

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All are places and people steeped in Estuary heritage, but where connections were severed as jobs disappeared. With employment patterns shifting in the fallout from automation, there are chances here to experiment and re-make our ideas of work and labour. Without wanting to romanticise the life of an early 20th Century bargeman, tough work for little more than starvation wages, we can start to provide employment of a kind that is disappearing today – that combines physical exertion with skilled knowledge and thinking, that depends on companionship and collaboration, that rewards working together, that distils pride in a job well done. That is fun. Some of it will be paid; some of it can be volunteered; perhaps some will be paid for?

Bigger questions spring to mind, about international trade, the terms of trade, of tariff protections and quotas; of the history of sailing ships, and the purpose of these vessels in the origins of European capitalism, of the East India and triangular Atlantic trades (other favoured early sail cargo producsts are coffee, chocolate and rum). And, coming right back to the present, Brexit, of course. There’s defiance in choosing to start up a cross European trading venture at just the time the isolationist genie in the referendum bottle has been released.

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But our immediate concern is earlier-stage – we need investment. Investment to develop our ideas about using the current fleet of Thames barges to transport cargo on the estuary (a move, to be noted, supported by the latest Port of London Authority strategy), to find willing producers and makers, to bring our story to the consumers we’re sure are out there. Ideally, to restore our own vessel, the Raybel, and bring it back into sail cargo use.

Where might that investment come from – funders (will they get the commercial end use?); corporate CSR budgets (so long as it’s not greenwash?); social investment funds (if the social value can be demonstrated well enough)? Then there’s community shares and crowdfunding, used successfully by several of our European partners, and that we are looking to use too.

In short – sail cargo is about many of the ideas in in this blog since 2010, but put into practical application. Is it a business? Is it an art project? Is it a campaign? It’s an adventure. We get the chance to do these things rarely. When young, when risks are worth taking as there is little to lose and much to gain. Our older years – I’m edging closer to ‘radical elder’ than ‘idealistic millennial’ – should be another time. If we’ve been fortunate enough to have some security and the skills of a working life, there comes a time to end the ‘optionality’ of staying stock still, and to use those tools in risk-taking. The Story continues on the Raybel Charters blog – this one’s done.

” Throw off the bowlines. Sail away from safe harbor. Catch the wind in your sails. Explore. Dream. Discover.”  Mark Twain

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On tarriffs and lobbies

One of the more successful lines our family business has developed in recent years is a small import-export service for an eco-cleaning product manufactured in, of all places, North Carolina, called Rockin’ Green. We (well, Joy) spotted the product, did some marketing around it and now sell it to stores in the UK, as well as to a number of retailers in mainland Europe.

So the Brexit debate was of practical as well as philosophical interest in our household – and the news a couple of week ago that that the UK government may decide to pull out of the EU Customs Union as a first step in Brexit talks an early worry. At the moment selling to those European markets is no more difficult for us than sending Rockin Green to Bristol or Hebden Bridge. We pack it up, arrange the transport, do the minimal paperwork required – and off it goes. Exit from the Customs Union would change all that.

The Customs Union got lots of coverage in the referendum without being mentioned much by name. It’s the part of the EU that involves the elimination of tariffs and quotas on trade between member states, and the imposition of a common external tariff on imports from the rest of the world. That external tariff is about 5% on average, though a much higher 13% on agricultural products. The CU is a different entity to the single market, which goes far further in harmonising regulations and competition policies to ensure the totemic four freedoms of movement across the EU bloc, in workers, capital, goods and services. You can’t be in the single market without being in the Customs Union, but coming out of the CU is a pre-requisite to doing trade deals with other nations – hence the apparent urgency.

So which would be better for us – in or out of the CU? We do pay a tariff on the Rockin Green imports we bring into the country. It’s not much – less than the average at about 2%. Maybe UK trade negotiators could get a deal with the US that would eliminate that duty, so a reduction in our costs of importing from the US would more than offset the EU tariff we would have to pay?

Maybe – but the most likely scenario I can see is that we end up in a position not much different to today, but only after a very disruptive and costly period of uncertainty.

In the Brexit talks businesses far bigger than ours – both within the UK and the EU – will be lobbying governments to keep zero tariffs to maintain their respective export markets. During the debate a common argument from Brexit campaigners was that “we import more from them than they do from us”, so the UK is in a stronger position. Leaving aside the dubious logic of making a virtue out of a dire trade deficit, I can’t see this. The relevant argument seems to be about the relative importance of export markets. For businesses based in EU states the UK market is relatively unimportant – it’s just one country amongst the 28. For UK business the loss aversion must be greater since it means losing access to 27 national export markets.

If a deal can’t be reached and tariffs are put in place with Europe, the compensating factor could be the rest of the world. We could reduce tariffs on RoW imports and get corresponding reductions in tariffs on our exports. At this point protectionist voices will be raised on either side, and we will see which wing of Brexit – protectionist or global liberal – will have most sway. But given the extent of trade with the EU is still much bigger than with the RoW, the chances of a compromise over Customs Union access still looks the more likely to me.

The Customs Union, though, is the smaller part of the picture. One of the reasons our mini export trade is so straightforward is that we only have to show the product is regulated for use in one nation. Outside of the single market we would have to go through the regulatory bureaucracy of EU environmental and other standards before any trading could even begin to happen.  This was the real economic case for Remain. Harmonising regulations and standards makes it easier to sell across borders – and that, through trade, leads to the learning that comes from being open to what others are doing. Ours is only a tiny business. Multiply it up thousands of times and you get some idea of the stakes being played for and the risk that has been taken.

One argument against harmonisation could be that it leads to a loss of local distinctiveness in products. I can just about see the case that some manufactures are becoming difficult to distinguish between each other, though that hardly seems an over-riding consideration. And it’s not as if the EU wasn’t alert to this in important areas – protection for culture being one example and the designations for regional food products that feature in the RSA/HLF Heritage Index another.

The better argument I can see is that “harmonising regulations” in reality becomes lower environmental and consumer protection than would happen if the nation states were left to themselves. Brussels is full of corporate lobbyists, who can concentrate their efforts on one city instead of having to spread themselves across lots of nation state bureaucracies (see previous blog). As a small business which faces the threat of some very big corporate powers (we often talk about nea as a political project and not a business at all) we’re deeply conscious of this too.

Will we suffer more corporate lobbying at the nation state or EU level? According to some accounts, the EU actually imported its policy on regulating lobbying from the US. A paper from the University if Montreal-McGill in 2010 recorded that, whereas the first measures in the US aimed at regulating lobbying activities date back to 1946, in the European Union, they were not put in place until fifty years later, in 1996. European Commissioner Sam Kallas said in 2007 that the “EU learnt a lot from the US” and one Euro MP suggested the EU had literally taken “a page out of the US lobbying book”. Presumably this was because there was little or nothing in the national rule-books to draw on. Which means we will be starting with a blank piece of paper in the UK, post-Brexit.

The Corporate Europe Observatory – which used to run the annual ‘Worst EU Lobbying Awards” – once denounced European lobbying rules as still “absurdly weak” and called for Europe to go even further in following the US model. Even though that Stateside experience hardly looks encouraging, either. Research by Christine Mahoney reported on Politico, claims that 89% of corporations and 53% of trade associations succeed in their lobbying efforts in the US, while the majority of those fighting for the wider public good, fail. Only 40% of citizen groups and 37% of foundations succeed. Mahoney puts this down to legislators in the US being beholden to the wealthy interests that will underwrite their next re-election bid. In the EU, the success rates are much more even:  57% for trade associations and 61% for lobbying firms, but citizen groups (56%) and foundations (67%) win at equal rates. “Policymakers in the EU do not need industry’s euros, so we do not see the same level of pandering to their interests”, says Mahoney.

The question is, which of these two patterns of success and failure – European or US – will UK law-making most closely match, now that we’ve taken control? That’s of more than philosophical interest to us too.

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EU Canoe

Confession time – I have to take my share of the blame. Back in the mid-90s I spent several enjoyable months working for the Financial Times on a ‘new media’ product – a CDRom, no less – which was all about the workings and achievements of the European Union.

It tackled the myths and misconceptions of the Union head-on, in bite-sized chunks, mixed with interactive graphics and – the height of innovation at the time – links to various ‘world wide web’ sites for those seeking more info.

I don’t suppose it was a huge seller, though I did see someone buying a copy in Waterstone’s on Gower St once, and it still pops up on internet searches, showing it being used as a teaching aid in Romania and Australia. I have a copy at home, though it doesn’t work on our computer these days. My kids pinched it in their pre-teen years, not for any incipient interest in European politics and democracy, but because one of its best features was a computer game we had great fun developing, and that we called EU Canoe. This involved paddling around the waterways of various European cities – Amsterdam, Paris, London, not Berlin – whilst avoiding the exploding hazard of sunken euros.

We called it FT Eurofile, with the pun clearly intended. Equally as clearly, our efforts of 20 years ago didn’t work. One of its other highlights, which all Brexiters would love, was an interview I did with Lionel Barber – FT Brussels correspondent at the time, now editor – about a very low profile EU institution called Coreper, the Committee of Permanent Representatives. Barber had written an article about this shadowy grouping, which could still provide material for a Eurosceptic diatribe on the insidious, hidden EU power system. I just searched for the article and found the FT had re-published it earlier this year, so it clearly struck a chord with more than me. So here we have the unelected bureaucrats that have usurped national democracy? Well, no. I didn’t think so then and still don’t. The permanent reps on Coreper are very senior civil servants (so, yes, unelected and definitely part of ‘the establishment’). But they act as go-betweens connecting national governments and the Commission. They are the very embodiment of nation state supremacy in the EU, not its antithesis. Here are some other things we failed to get across in FT Eurofile and that I didn’t hear in the debate.

  • The Commission proposes legislation but only under national government behest
  • The European Parliament is under-powered because the national governments like it that way.
  • The UK government is closer to the EU’s final position on all policy issues than nearly all the other 27 and, though outvoted more often than any other country since 2010 still voted for 87% of the laws passed (there’s the work of Coreper).
  • And that 13% disagreement could have been for domestic consumption. See these very good articles from Kings.
  • Size of the all-consuming EU civil service? We said the Scottish Office in Eurofile, but with that comparison no longer available …. about the same as Birmingham City Council
  • There is no ‘Brussels’ as a separate, autonomous power centre. It’s a mechanism for dealing with collective problems between the nation states.
  • EU policy will change if the national governments change their political outlook.
  • Corporations are multi-national and will pick off national governments more easily than they can a cross-territory governmental institution.

OK, I admit, that last one wasn’t in FT Eurofile. And a far better attempt at getting under the skin of Brussels as a law-making body than we achieved has just been produced by Swiss film maker, David Bernet. His film – Democracy (they may have toyed with putting a question mark at the end) really ought to have been obligatory viewing before the vote, but only screened once at this year’s Open Docs festival. It follows the two-year journey of an EU Green Parliamentarian from Germany, on a quest to introduce a European-wide data protection law. Bernet got lucky as the wikileaks story happened during the filming, making a technocratic exercise front page news. But the film is riveting – especially once the lobbyists and corporate lawyers wade in, from the US tech behemoths (who, irony of ironies wouldn’t agree to be filmed) to small Swedish start-ups. As one says “99% of political lobbying in Brussels is done by corporations”.

Does the very Brussels system create that – or is (was) the EU a much needed bulwark of civic responsibility, acting on our behalf against corporate vested interests? It’s difficult not to feel the latter watching the stamina of the young, committed Euro-politicians in Democracy. Yet it’s impossible not to also register who they are – educated, aware, engaged, with a steely sense of purpose. And Vote Leave could be read as a protest against the way these decisions, however worthy, are taken by this ‘elite’ – if we must call them that – on behalf of people, rather than with or by them. That’s what we now have to solve.

Where do we go from here? As it happens I still think the black box of EU law making needs opening and better understanding (watch Democracy if you can). We are gojng to be absorbed with Brussels give and take over the next however many years it takes to negotiate an exit. Meanwhile, hope we haven’t capsized our EU canoe.

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The Cnut Conundrum

A fading memory now, but family Xmas last year was in Cumbria – at Crosby Garrett, scene of the Roman helmet find of 2010. Little chance we would make any such exciting discovery: the three days were consumed by virtually continuous rainfall.

Crosby Garrett is high enough that it avoided the terrible flooding affecting communities lower down the valley, and we were at least able to walk up onto the fell – twice getting sodden, once in glorious sunshine. And though we saw no flooding in the rural areas, on the trip back home we certainly did – in central Leeds, where we had to take a circuitous route around the city centre to reach the train station. In the 5th most populated city of England.

I’ve written on this before, but I do wonder how far down the long queue of demands from new metro authorities might be the issue of real powers to re-connect cities with their surrounding rural areas – or that give cities the powers of responsibility for those. Historically this would have been the case – cities shaped their surrounding countryside.

So far the devo debate has made the case for powers over strategic planning, transport, business rates and other tax raising authority. The first of those could work to better connect the urban with the rural, but there’s litlte else on the need for a devolving of powers over countryside and agriculture. Yet there has to be a case given the consequences that national policies have had in severing that connection, brought home by climate and weather events on the scale of the Xmas floods.

Experts in this area, so far as I can tell, seem widely agreed that solutions are around better upland management and flood protection in the right places. Tree planting and restoration of peat bogs may not be the entire solution everywhere, but it’s uncontested they are part of the answer – if alongside other measures to slow water passage such as preventing soil erosion, creating pasture on river margins; protecting heather moorlands, and avoiding over-grazing.  If all this is understood but not happening, what is the explanation?

A paper by Dieter Helm discusses the issues using the wonky language of ‘ecosystem services’ – a term that sounds as far removed from people’s lived daily experience as you could find. And yet that couldn’t be further from the truth – the ‘services’ nature provides have a direct bearing on all our lives. Helm argues the problem is that we’re not using an economic approach in making decisions about flood policy – by which he means that decisions aren’t made using an asset-flow approach and don’t involve thinking about costs and benefit trade-offs. ‘Optimal level of flood defence’ is an economic concept, that compares the costs of protecting with the benefits of doing so. What we have instead is a project based approach with an emphasis on property most at risk. And a set of agricultural subsidies for activities that create flood risk.

That last point is also made by on a Green Alliance blog – where Miles King has pointed out the irreconcilable demands of protecting both agricultural land and down-river communities. Farming on the upper reaches of river catchments is especially important in determining flood risk – but is typically the most highly subsidised.

This isn’t so much a failure of cost-benefit thinking as a mis-application of it. So there must have been institutional problems too – lobbying powers, no doubt, but also real questions about who pays for flood protection and how.  The options here are tax, charge or insure. Helm favours a return to water catchment based flood boards with costs for flood abating raised through water bills, though he acknowledges the alternative of adding to the local authority council charge could work too. This might be characterised as a choice between economic or environmental catchments. I can see why environmentalists like the idea of an approach based on natural systems, but I wonder if the former hasn’t got more chance of success, being aligned with more powerful political and economic forces.

I’m also beginning to see these issues in  work we’ve been doing with environmental consultancy 3Keel on how best to fund landscapes. We started that work by recognising that much landscape funding is failing to address the biggest threats and trends, such as the impact of insensitive development on cultural heritage, or modern farming practices on biodiversity. 3keel describe this as the Cnut Conundrum – that we fight a noble but losing battle in which the scale of operation fails to measure up to the issues that need addressing.

Solutions will not be easy to come by,  but I’d say our work is suggesting two things. Firstly, switching from a negative focus on the risks faced in a landscape to a more positive emphasis on the benefits provided by it.  And secondly, to a recognition about who needs to be involved. While local authorities and owners are important players in the landscape, so too are infrastructure companies and regulators, developers, locally based manufacturers, distributors and retailers. And so too are the people in urban centres who both benefit from and bear the costs of how a landscape is managed. We need to see these people as having both a vested interest in its long-term future and some responsibility for it. As with so much else, that looks more feasible, to me, on a more localised city region level. It also depends, crucially, on city dwellers feeling connected to the wider landscape that surrounds them, not just the nature of their local park or wildlife reserve.

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Open and be damned

From a standing start to £10m in turnover in just three years is going some – and for a non-profit membership, training and research organisation more so. But that’s been the giddy rise of the Open Data Institute since founding in 2012. Granted – it’s had the backing and benefit of some high profile leaders in Tim Berners Lee and Gavin Starks. But it’s testament as well to the burgeoning interest in the power of Big Data.

The pitch – that data access, availability, analysis and presentation offer the potential to provide insights and find solutions to contemporary problems – is a compelling one that twins the modern zests for tech start-up and social mission. It appeals to my inner economist too – we’d expect social outcomes to be less than optimal if knowledge is ‘asymmetrical’ – known, understood and used by one group but not others – or if the cost of information dissemination prevents the ‘positive externality’ of spill-over effects.

Plenty of examples of using data to solve social problems were on show at the recent ODI annual summit:  from ambitious plans to  help solve the national housing crisis, by matching householders needs with available stock; to a clever app that can serve the dual purpose of helping schools track sickness absence whilst mapping outbreaks of notifiable diseases. Another offers market intelligence to assess the business potential of  empty commercial property in urban centres by aggregating data on local buying power, and combining this with existing data on the costs of doing business. It’s a useful guide to whether that great business idea you had (my latest is a local bakery based that looks like this) is likely to be a going concern. I’ve even wondered about its usefulness for assessing grant funding business start-ups, such as through HLF’s Heritage Enterprise programme.

My own efforts in this area were last year’s major work project, a joint production with the RSA to create the first-ever Heritage Index. Combining more than 100 datasets we devised this as a tool for starting conversations about the heritage that exists in each local authority area of the country. We added to a basic ‘assets’ layer by including data on the extent of heritage-based activity that is also taking place.

Or at least – what heritage assets and activities have been recorded as datasets, both ‘official’ (the Historic England listed buildings set for example) but also through bottom-up data initiatives (blue plaques created by openplaques.org).

Once we’d crunched the data it seemed logical to present the results as a ranking of local authorities – which inevitably became a ‘league table’. But we did this as much to find the surprising stories it would reveal. Scarborough, Hastings and Dundee were some of the less expected top performers in the Index, alongside the places you’d expect to see – the City of London, Edinburgh and Oxford. All that got good publicity. But alongside came a mini media storm in the places with poor rankings. On one level that was understandable  – why further blight places by bringing  attention to another layer of under-performance in areas already perceived as ‘struggling’ (though, interestingly, our Index didn’t find any link between score on the heritage Index and measures of deprivation)?

Inevitably we were also told what was missing from the Index. This was welcome. We hadn’t created any new data for the Index – all we had done was to bring together existing sources in a new, accessible way, using attractive mapping and visuals. But this shone a light on the underlying data sets – and revealed more clearly what has been deemed worthy of being counted. Look for example at this heat map of listed buildings – it’s the result of expert judgements on heritage that is worth conserving, but is it also a reflection – at least in part – of social and political factors that have led to more efforts to list in the South and parts of the Midlands?

Presenting this data more openly, and in a more inspiring way, can bring it to more people’s notice and lead to discussion, challenge and debate about what people really do care about and value. According to community archaeologist Helen Graham, “ I wonder how the Heritage Index might be deployed as a conversation starter, something we can productively debate and disagree with. Indeed, it is probably more through the activity it produces rather than the activity is seeks to capture, that the Heritage Index has the potential to become a lever for change“

Interestingly this experience was similar to another project featured at the ODI summit. Run by Jamie Whyte in Trafford, this was a determined to effort to make sure everyone locally could access data about their area – from public health consultants, to community groups and the general public. The data assembly and mapping are impressive enough, but were combined by the team’s commitment to share everything they do – blogging, tweeting, speaking – through data surgeries, data visualisations, and meetings. One practical result was to help in deciding the location of defibrillators in places where they would be most useful. Another was how data about energy use starkly revealed how much more energy was consumed in the richer parts of the borough – and hence how much more responsible these local residents are for localised carbon emissions. This was a potent conversation starter – just like our Heritage Index.

Which all goes to show us, I think, that it’s the O word which really counts in ODI. In many cases clever data crunchers at RSA and Trafford are simply combining existing datasets in new, interesting and easy-to-view ways. If there are omissions, oversights and prejudices in how that underlying data has been assembled, these efforts are to be applauded for bringing that to light, not castigated for flaws in their methods.

Appropriately the theme of the ODI’s summit was ‘Generation Open’ – “a generation not bound by age, income or border that expects everything to be accessible” and with a mindset that “believes we can transform sectors around the world, from business to art, by promoting transparency, accessibility, innovation and collaboration”. So open up. Just don’t expect plaudits from every quarter when you do.

 

ODI

 

 

 

 

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More stuff for Labour councils in the North

With the argument about the principle of devolution to cities now seemingly settled, attention has begun to turn to the details of the deals being done. For some – the Guardian and nef amongst them – these do no more than give cities the responsibility for making cuts imposed by central government, and to take the stick that will come with that. The Treasury decides how much (little) is in the wallet: cities how to spend it.  This is devolution as a clever political ploy, a deflecting-the-blame game. To which, the Devo-pushers –  Centre for Cities, Respublica, RSA – need only answer that we have to start somewhere, whilst agreeing that this is only a start.

From a different perspective, some Conservative and county councils are reportedly beginning to ask where this leaves them – why, they say, are all these new powers being granted to Labour councils in the north? According to the LGIU these same Councils are also unhappy with the model of combined authorities that the government is promoting. This was also picked up by a recent Centre for Cities blog which noted the counties v cities tension as a likley stumbling block on the devo-path.

But what devolution model is appropriate outside of, or alongside, the cities? The counties  need to come up with their own ideas, and none has been immediately forthcoming – though the search could spark some very interesting proposals. In Bristol for example strategic planning initiatives are cross national.

All this also has parallels with a research project I’m involved with – ‘Heritage Identity and Place’ with the RSA – where the same question about the role of rural places and countryside has been raised within a project which, at first glance, I can see looks very urban focussed. My answer has been to talk about what I have called the ‘hinterland’ of cities.

As with many of my other ideas, this has been based on Jane Jacobs model of economic  development – not the community planners’ favourite, ‘ Life & Death of the American Street”, but the less well-known ‘The Economy of Cities’. Jacobs simple idea in this book was that any economic unit needs to be understood in terms of what it imports and exports. This applies to a city as much as a state – indeed any social unit from a household, a family a community, to a continent. Growth comes from creating a surplus over what is consumed lcoally, and – initially at least – this comes about through a process of import substitution. Places are sustainable if they are either fully self-sufficient (though that’s risky) or if they at least balance what they import with what they export. And this doesn’t have to be understood in purely market economic terms – self-sufficiency can be social, and outside the market – through networks of family, friends and neighbours.

What do rural places, villages and market towns export? Mainly labour – to cities. Agriculture, still, for sure – though employment is low. Some pioneer digital businesss and still some manufacturing too, but all on a tiny scale compared to cities.  Otherwise – they import – everything from food and retail, to culture and leisure. Put another way – to pay for all this stuff and experience, the inhabitants of rural places have to migrate on a daily basis. Thought of in terms of the income of residents, this does work, and villages populated by people who work in cities are perfectly viable. But the danger comes if so little consumption takes place locally that it leads to dormitory settlements with no retail or cultural offer. And that, in turn, means  those not securing city jobs face a marginal existence, with no work available in fulfilling local economic demand – whether that’s working in a village shop, pub, hair salon, plumber, whatever.

Jacobs thought rural settlements should not be thought of as distinct from their nearest city – even cities – but as having a symbiotic relationship with them. To my mind, that makes the case for city-region strategies that encompass and incorporate the needs of their local hinterland – not just as suppliers of labour, facilitated by efficient transport networks, but as places where the import/export balance needs to be understood, and strategies created for developing rural places that are a source of more products for the city – the ‘exports’ of the County. In many cases, of course, this means returniung to something close to their original economic rationale.

But perhaps most interesting is that this concept could be applied beyond the confines of market goods and services, to encompass the idea of environmental services – things like outdoor recreation, flood protection and carbon sequestration that benefit the city, but only if managed well by the countryside. These green services should  be as much the part of any city’s strategy as plans for redundant iner city sites, local housing and urban greenspace. In time, fiscal freedom for Metros could even, it seems to me, provide the opportunity for much more experimentation with ‘PES’ schemes – payment for ecocsystem services. These are proving fiendishly difficult to establish on a national scale, when being coordinated by a centrist department like Defra, but wil be far  more viable if developed by city regions who know their own fates are bound up with the rural hinterland that surrounds and sustains them.

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Social enterprise and small is beautiful

I gave a very unsatisfactory answer in a radio interview recently about social enterprise. Having had a lot more experience asking the questions than answering them in media exchanges, it’s an uncommon feeling to be on the other side of the mic.

The radio podcasts are being put togther by Nick Patrick for the University of Herts and are about the many and varied wonders of heritage in promoting wellbeing. Nick told me I had a “special interest” in social enterprise – he’d done his homework – and why was this?

I said something about soc ents being very much “of the moment”, combining social and/or environmental purpose with the entrepreneurial nous that is needed to see where there is some opportunity to earn income from commercial activity. In a time of constricted public funding that goes a long way to helping people with ideas put them into action and keep them going.

But that’s all a bit reactive, even defensive – as if social enterprise is no more than a necessary response in straitened tmes. There is a more positive, invigorating point that I should have made – which is about how we want, not just problems solved, but opportunities seized. And by whom? By big players – whether of the State or the corporate world? Or by a myriad of small enterprises and endeavours? My tendency is to support  the small. Not (just) out of backing the underdog, but for good, solid reasons of efficacy. Big ideas – as Adam Lent is busy explaining – aren’t working so well any more. Power is better shared, lots of small ideas gives us more diversity and choice: it’s less risky, as we’re less reliant on big players – State or corporate – doing the right thing.

And small is more practical and possible in a way that perhaps it wasn’t in the mid 20th Century when communication was difficult, and people’s creativity thwarted by social structures of deference and curtailed education. Putting our faith in big organisations to sort things out  requires too much faith in those bureaucracies and asks us to place too much trust that our best interests will be served. Meanwhile, the chance to work in small organisations, whether self-employed or in a business you’ve helped to create, gives people more freedom.  Small organisations that aren’t bent on growth find it easier to keep a sense of purpose.

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Designing sharing

Brief evening stopover at nef, for the launch of their latest report ‘Design for Sharing’ which looks at the rise of the sharing economy. Given I’m frequently driven to the conclusion that the biggest issue we face is how to resource social and environmental intiatives that need to happen but which will always struggle to turn a profit, this was a subject tapping into some recurring thoughts.

Anybody working in organisations with social or environmental aims today knows well enough that grant funding of all sorts is becoming more difficult to obtain. And it comes with larger demands placed upon it, both because of huge cuts in the supply of public sector funding and because of an increase in demand from organisations seeking investment.

As a different way at looking at the things – for sure doing good in the world requires some sort of ‘resource’. But it doesn’t always require cash. We can provide friendship, help, companionship and be very sure it will feel worthwhile. We can share what we own at no more cost than the loss of the use of our possessions for a while. We can volunteer our time, skills and energy. And, for some, digital networks are enabling  a lot more of this kind of time and asset sharing than has ever occurred before – creating what has been dubbed the ‘altruistic economy’ of social sharing.

But as the nef report points out there is plenty in the sharing economy which is not, as might be imagined, about stepping outside the cash economy. Instead, access instead of ownership characterises many of these businesses – with new ventures popping up to lend out, for a fee, cars, flats, music or even people. nef thinks much of this is problematic – the marketisation of ownership, for those who are already asset rich. Isn’t this just the further intrusion of monetization into social interaction? What I once would lend, I now hire. So EcoModo (lend your stuff for money) gets a thumbs down, though Streetbank (lend for free, and with a nice line in creating social connections) is a better idea. And TaskRabbit is ominously seen as the development of a contemporary form of domestic service, “neighbours” (read, people with more time on their hands than you) on-call to do your  shopping or run errands when, and only when, you need them done.

Other recent upstarts look more like existing business moving online, though in some – AirBnB, Uber – it’s true  this is accompanied by a big expansion in potential suppliers, as the costs and ease of renting rooms or giving lifts comes crashing down. Hence run-ins with incumbents whose means of earning a living are suddenly under threat. And what if easier access to rental cars or taxis means less incentive to use public transport, as nef claimed is happening?

I think some of this is a bit harsh. If access not ownership leads to less stuff per person, that does sound like progress towards more efficient consumption to me. Zipcar is fantastically convenient if you live anywhere near a docking spot, and feels like it could well be part of a city-scene that squeezes out car ownership. Or take nudie jeans – use and return for repair/re-use rather than use and throw. And are we reallty going to defend the right of London black cabs to drive around searching out fares in such an inefficient way – creating the biggest single source of air particle pollution in the city as they do?

But all this could become much much more interesting if networks arose on a much more lcoal level, for people to exchange goods, skills and time between themselves. Especially if these then connected with alternative currencies or linked to the existing idea of Time Banking. So an exchage payment is made, but in something other than the main currency of the economy. That would have the potential to bolster  local community resilience. And perhaps the most interesting question then, is what these new exchange options could do for life patterns – will they make it easier to ‘disengage’ with the mainstream economy, into a lcoal, alternative economy? And could people make that change? As an adjunct to existing life, out of choice? Or because of no other option? Could a large-scale uptake develop from a confluence between those for whom some form of alternative economic engaggement is a necessity, due to their exclusion from the mainstream employment market, and those for whom this is rather more of a choice –  the alternative economic acticvity of the Aftermath project.

As an indicator of the forces driving decentralisation and more localism – beyond just political sourness with Westminster or grandstanding celeb Mayors – the uptake of hyperlocal exchanges may be as good a measure as any.

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Might cities fail?

One of the recurrent themes of this blog is that cities now offer better prospects for dealing with the social and economic problems that we face. This is becoming dangerously close to a consensus view on right and left -witness the recent endorsement by the ippr, following on from the decentralisation push within the Coalition (which has admittedly got nowhere) by Hezza.

Firstly, a reminder of the theory. Cities have the scale and resources to get things done, they are the active units of economic change – Jacobs model of exports and import replacement, so that collectives that are more successful at import substitution will export the surplus they produce, leading to more import substitution. Places that don’t do this don’t grow, hence all growth is city based. As Jacobs said, once we “try looking at the real economic world in its own right rather than as a dependent artefact of politics we cannot avoid seeing that most nations are composed of collections or grab bags of very different economies.” Import substitution and exports create growth by increasing the capital held by they city’s citizens, which is re-invested in more import substitution, so increasing demand for workers. The city then exports its know-how and transplants those activities that it earns less from undertaking – sometimes then re-importing those things it had import substituted. It’s all highly organic and based on the spontaneous improvisation and diversity, sophisticated specialisation that can only come with high concentrations of people. This is called ‘agglomeration effects’ today but Jacobs is a more developed theory. Agglomerations of people are not always economically vibrant – the most vibrant economic units are always collections of people. This matters not just because of economic growth but because all human advancement is a product of these places – cultural, technological, social.

More modern writers have tended to emphasise how cities are more practical units of government where pragmatic networks can be assembled, where top down can meet bottom-up without a vast void of inaction in between. People can relate to the city, to the local, in a way that connects with their own identity in a way that is much less contentious that the fraught territory of national identity. But to prosper they need to be cut free and left alone – they need flexibility. The well intentioned national standards of a minimum wage is for this reason counter-productive, as a re national tax rates, national

This is so compelling a tale to me that its worth considering the counter-argument.

1. What about the rural? This criticism seems to proceed from the assumption that the job of national policy is to sort out the balance between rural and urban. This completely flies in the face of Jacobs theory. Rural regions will prosper if their relationship with a successful city is strong – though they never will be as economically active and therefore wealthy as cities, by definition. The policy issue here is about making sure cities pay for all the rural services they benefit from – including those they can’t ever import substitute.

2. Can we really trust local authorities as the unit of government? Quite possibly not, but cities will stand or fall on the quality of their local governments so we better start improving it. And leaving more to decentralised administrations should force a double devolution to community co-creation which is much more difficult to organise at a national scale.

3. Sustainability. Air pollution in cities is bad. Cities are bad for your health. Cities can’t support their own need for food and depend on expensive resource intensive supply chains which will hit a crisis when these become more stretched. A version of this argument is that cities were an industrial age creation of the west and can be ‘skipped’ by developing countries as they move to a more dispersed model of social and economic organisation. See Vinay Gupta on this for example. There may be something in this but I’m not convinced as he is that tech will substitute for the agglomeration benefits of lots of diverse people in big cities.

4. Just because the nation state has been captured by the corporates it doesn’t mean the city won’t be. True enough – as Anna Minton has shown in her description of private-domain regeneration. Cities need to be alert to the rent capturing antics of property owning classes, from slum landlords, to greedy retail rent ratcheters (not reserved to the private sector) to multi-national speculative developers. But this is not a reason not to put the fate of the city in its own hands.

5. Some cities will struggle and will need to be helped out. The most difficult to deal with, as it’s not a comfortable message for the Left, rooted in reviving the fortunes of run-down industrial cities. But Jacobs has it right again. “Development cannot be given. It has to be done. It is a process not a collection of capital goods.” Forced transfers from cities only weakens them and places further transfers under threat. London will need to keep what is London’s.

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Cities and cyber currency

A Camden church has started accepting Bitcoin donations. St Martin’s in Gospel Oak says it wants to keep up with the times and has warned that the current financial system is not all that reliable.  I’ve just checked where else I an use my Bitcoins in Kings Cross. Clink hostel takes them, but that’s it so far. So how far is the Internet currency from being one more tool in the creation of a localised economy?

Back in the 80s a big new alternative economy idea was LETS – Local Economy Trading Schemes. The idea was to bypass the mainstream economy by creating local networks of exchange and trading that would be mutually supportive. These could be local currencies or simple barter systems – antecedents to the currently fashionable idea of the ‘sharing economy’ – where time became the currency that was the basis of exchange. Hence time-banking. In that pre-Internet age the logistical tasks must have been daunting – all that photocopying, keeping paper records, passing information around at meetings or by post.

So I was pleased to find the idea still survives – a LETS network is still in existence and you can find local time-banks from Penwith to Thurso. A small number of local currencies are still in circulation too, and occasionally generate media  interest – Brixton, Bristol, Totnes. This despite the difficulties in creating notes and having to beat the pavements to generate interest amongst shoppers and shop-owners. Not surprisingly all are in strong outposts of the transition movement. Other initiatives have stood the test of time less well. It’s several years since I last used my Big Issue ‘Wedge’ card to get a discount from local stores.

For the LETS community the idea was to facilitate exchange without a money system at all, and there will always be a place for that idea. But could the local currencies be overtaken by the rise of Bitcoin, the alternative currency for the cyber age, making feasible an ideal that was practically so difficult in pre-digital times? It’s tempting to feel the social need for an alternative currency is now matched with the technology that can make it a reality: that financial crisis and technological developments have in tandem created the conditions for crypto currencies to emerge. And that could in turn spur the development of City economies, able to create their own currencies.

It’s not obvious why parallel currencies should emerge. Whether Bitcoin or Brixton pound, they involve consumers in an extra transaction, converting between the ‘standard’ currency and the alternative. In the Brixton case its easy to see how the costs of this extra transaction are outweighed by the benefits it brings. Traders benefit if more transactions take place in the area covered by the currency; consumers get the reassurance that local shops are more likely to survive. And the costs are very low; there is little risk of not being able to spend your Brixton pounds.

For Bitcoin the potential gains look bigger. Forex transaction involve the costs of currency conversions anyway, so it’s easy to see this being cheaper through a web-based account with no need for a money changer. Peer to peer payments can also be kept out away from prying eyes of government, to avoid tax or make payments for illegal goods, which has inevitably caught the media eye.

But to be ‘real’ money crypto currency needs to be more than an internet transactions token. It would have to move beyond fulfilling just one of the economist’s standard definitions of money – a means of exchange – to meeting the other two as well – a unit of account and a store of value. But this is less technical than it sounds. Whether a currency is a unit of account or not is really a matter of sentiment: when comparing the monetary values of goods for exchange do I “think” in terms of pounds, dollars, euros or Bitcoin? This is a bit similar to becoming fluent in a language, when you stop translating in and out of a mother tongue. Money as store of value is simpler – can I be fairly sure the cash I have in my account today will be worth much the same tomorrow, next week or next year?

How could crpto currencies move beyond being a means of exchange and take on these two extra roles? Their fate will be the mirror image of trust in State backed fiat money.  Another financial crash, after the stoking of yet another asset bubble, followed by mass loss of savings as governments are unable to afford more high profile bail-out, and we could see trust in national currencies ebbing away very rapidly.

We’re now so used to State money it’s difficult to imagine it not existing. But paper money was the invention of goldsmiths in the 16th century, a promise to pay against gold holdings, and as recently as 1921 banks in England were still able to print their own notes – so long as they were located more than 65 miles from London. The last to do do was a bank in Somerset with a name, “Fox, Fowler & Co”, redolent of financial cunning. From the Bank of England being given a monopoly on note printing, it was then but a short decade to the 1931 break with the gold exchange, marking the arrival of modern ‘fiat’ currency: money backed by nothing more than trust in the state.  It’s enshrining in law – ‘legal tender’ – gives but a veneer of solidity. Legal tender has no real practical application.

So a system created less than a century ago has no claim of permanence. A central bank issuer made sense for a period, roughly equating to the dominance of the nation state. But  it will  fail to prevail if a debased, untrusted currency loses its role as a store of value, creating the opening for a modern version of Fox Fowler & Co.

For sure, Bitcoin as set up couldn’t the job. To go viral it would need the backstop of a transparent and trusted institution – something a bit more transparent than the shadow world of mysterious data miners that currently control the supply of Bitcoins.  There’s also a debate about whether the ‘cap’ on Bitcoin creation is dangerously deflationary, based on the economic theory that wages sometimes need to fall, when the skills of those workers get out of date. Given that money wages are sticky – people don’t like taking a pay cut – inflation does that important  job instead. This is much the way public sector workers are being treated at the moment. This use of inflation to ‘grease the wheels’ of the economic engine is of  dubious morality. But more importantly for this debate is that it’s a technical issue that can be resolved if crypto currrencies bring in some economics knowledge to go with their competence in algorithms.

And perhaps this need for new monetary institutions is where smaller economic units like city economies and devolved nations come in – with local banks creating their own  crypto currencies. How about it  Scotland?

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