This is part one in a series of articles about building community wealth. Part 1 provides an introduction to the concept of community wealth and explores how to approach economics with a permaculture framework. The series covers the following topics:
Oftentimes people are surprised to learn that permaculture is about more than just eco-friendly gardening. Certainly a garden is a wonderful place to learn about permaculture principles and ethics, and many well-known permaculture methods relate to land-based projects such as growing food. However, gardens are not the only places where we can apply the permaculture principles and ethics.
Permaculture can actually be applied to anything people create–from physical systems (such as transportation design, farms, and housing) to social and economic systems (such as educational systems, financial systems, and healthcare). We define permaculture as “an ethically based whole-systems design approach that uses concepts, principles, and methods derived from ecosystems, nature connected communities, and other time-tested systems to create human settlements and institutions.” For more information, read our article “What is Permaculture?”
In this series of articles, we will explore how we can assess and approach economics and community development with a permaculture framework. In particular, we will discuss strategies for building community wealth in our community of Santa Cruz, California. To offer some concrete examples of community wealth building happening in California, we interviewed a number of folks to learn more about what this work looks like today and how we can support it into the future.
What is Community Wealth?
We asked Ted Howard, President & Co-Founder of Democracy Collaborative, to define the concept of “community wealth” and explain why it matters. He writes:
“Community Wealth Building is a ‘systems approach’ to economic development built on broadly held and locally rooted ownership (through multiple forms such as cooperatives, employee-owned companies, social enterprise, land trusts, municipal assets, public and community-owned banks, etc.). The goal is to create a democratic economy that produces reliable outcomes – including job creation, equity, inclusion, economic stability, environmental resilience – as a natural consequence of the functioning of the local economy.”
To learn more about this concept, please visit community-wealth.org. Keep this definition in mind as we explore both how permaculture can help us understand economics and community development differently, as well as some ways in which people are building community wealth locally and regionally.
Permaculture approach to economics
What does a permaculture approach to economics look like? How do we take the same principles and ethics that are used to design a garden and use them as a framework for first critiquing and then re-imagining “a democratic economy that produces reliable outcomes”?
Starting with a foundational book by one of the “co-founders” of permaculture in 1988 and then referencing a more recent analysis by a permaculture designer based in New York, we’ll look at how money, community assets, and the concept of capital itself can be examined with a permaculture lens.
Permaculture: A Designer’s Manual
In Permaculture: A Designer’s Manual, Bill Mollison writes about money and finance, identifying parallels between natural systems and financial systems that demonstrate how the principles and ethics of permaculture can be used to critique finance and economics.
Mollison writes that “All money arises from the wealth of the natural world (plants, clean water, clean air, stored energy). The accumulation of unused wealth, or wealth that does not lead to the proliferation of life, is a pollution of the same nature as any unused resource. Manure and money have much in common” (533). The permaculture ethic often referred to as “fair share” can be identified here, as well as the permaculture principle “Produce no waste.”
After clarifying that money itself as a form of exchange for needed assets is not inherently “evil,” Mollison goes on to describe “categories of resources or assets” that money can create, including degenerative, generative, procreative, informational, and conservative (534).
All of these categories are needed in a society, he says, but when society focuses only on degenerative assets (“buildings, roads, cars, furnishings, and appliances of society”) and generative assets (“those things which manufacture or process raw materials into useful products”), it “will first pollute, and then eventually extinguish, its resource base” (534).
Globally, we are experiencing what he describes as our capitalist economy prioritizes profit and growth over conservation of our natural ecosystems (the permaculture ethic of “earth care”) and the needs of current and future generations (the permaculture ethic of “people care”).
By observing our economic system just as we observe the natural world for patterns, we can identify principles that, when in place, help advance efforts toward a more just and sustainable world.
For instance, just as natural ecosystems are limited by particular conditions and availability of necessary resources, Mollison writes that “With sound ethics and resource usage restrictions, any financial institution can prevent leakage of wealth and the erosion of basic resources, so that it is itself an asset to community, and builds wealth for re-investment” (534).
Later when we explore some examples of community wealth strategies taking place in California, we will see how some folks are creating organizations, banks, and collaboratives whose missions are committed to ethics and parameters that allow these entities to truly be “an asset to community,” rather than to shareholders. Some of these organization types and related issues are mentioned in Permaculture: A Designer’s Manual, including “Cooperatives” (536) and “Land Access” (545).
Eight forms of capital
In 2011, more than two decades after Mollison examined finance and economics through a permaculture framework, Ethan Roland, Founder and Lead Designer at AppleSeed Permaculture, put together an analysis of eight forms of “capital.”
His identification of eight forms of capital is based on the 8 Shields Model that we often reference and utilize in our permaculture courses. The 8 Shields Model was developed through observation of natural patterns, which is also a permaculture principle: “Observe and interact.” You can read a description of the 8 Shields Model here.
To introduce the framework for his exploration of the eight forms of capital, Roland writes about the aims of “financial permaculture”:
“Financial Permaculture goes beyond the traditional permaculture approach to economics and asks the question, ‘What would it look like if we re-designed the global financial system using permaculture principles?’ and ‘What if our financial system looked more like an ecosystem?’”
These are key questions to keep in mind as we learn more about community wealth building strategies and continue to identify solutions to the challenges of our current economic system.
After offering a definition for “capital,” Roland mentions Mollison’s “categorization of assets” from Permaculture: A Designer’s Manual. He writes that he examined capital further because he “wanted something that would be more helpful for understanding the complex transactions and exchanges swirling around [him] as a human being and us as a global community.”
The eight forms of capital that Roland identifies in his analysis include:
- Social capital
- Material capital
- Financial capital
- Living capital
- Intellectual capital
- Experiential (or human) capital
- Spiritual capital
- Cultural capital
To read about each form of capital, please visit the AppleSeed Permaculture website here.
By looking at an economic system as an ecosystem, we observe that these “8 forms of capital” move throughout an economic ecosystem, just as natural resources like water and oxygen cycle through natural ecosystems. In mainstream economics and media, we focus so much attention on financial capital–money–that we sometimes fail to recognize the other forms of capital within our economic system and their importance.
The article continues by mapping how these forms of capital flow through our world (see below). He also draws connections between eight forms of currency that relate to each form of capital.
Roland writes about how the eight forms of capital and the way they flow can help us shift our perspectives about economics and investment. He says:
“The eight forms of capital provide a clear path towards a small point of great leverage: Eco-social Investing. We can encourage individuals, businesses, organizations, and governments to mimic nature’s practices of investing: Locally, intimately, diversely, and primarily in living capital.
“One of the most useful applications of this map is for growing and shifting our own understanding of the world and the transactions we engage in.
“When people and the businesses, organizations, and governments understand the eight forms of capital, they may find that financial capital is not the whole system. This can lead to decreased consumption of non-essential goods and services that fuel our infinite-growth-based financial system.”
We can build capital in these different forms without depending upon monetary wealth, allowing us to creatively expand our personal and collective definition of a just and sustainable economic system.
Now that we’ve explored some permaculture approaches and alternative frameworks for understanding economics and capital, we’ll explore some of the alternative strategies to building community wealth and the ongoing, on-the-ground projects that bring this work to life.
This is part one of a series of blog posts about building community wealth in Santa Cruz. Read the next post in the series here.