Turning Up the Downturn Begins Right Here

By Jane Kolmer, Monroe County Economic Development Council

Have you ever stopped to wonder why everyone is so nervous about America’s current economic condition, even if they have not personally suffered any loss? It seems that modern man may not be as far removed from our more primitive ancestors as we would like to think. The instinct to run when a member of our “herd” senses something to fear is still a big part of how we deal with many challenging situations.

It takes a lot more than logic to resist the temptation of fear, even if the days in which it was smarter to “take flight” than to question a threat have long passed.

The national economy is decidedly difficult to predict with any accuracy—even the guys who get big bucks to do so have missed the mark widely this year! It’s at least as difficult as predicting the weather a year from today, or foreseeing exactly who will live to be 100 and who will die at 40. No matter how much of an educated guess we make, it is still only that--a guess.

So what can we do to improve our chances of maintaining a high quality of life through these difficult times? The answers are probably the same as at any other time, but they require increased attention to the basics.

The media is full of advice on how we can individually improve our personal “financial strategies.” More often than not, this is advice we should be following all along, even when the economy is at its strongest; unfortunately, it often takes trouble to get our attention. Those who endured the transition called the Great Depression of the 1930s became more diligent, more resourceful--maybe even smarter--and that is the good news about bad economic times.

Paying attention to the economic conditions in your local community is also good advice to follow any time. As with our personal finances, the need for community economic awareness increases in difficult times. People instinctively become more conscious of how they spend their money. They become more aware of how their own economic decisions, coupled with those of their neighbors and of local taxing bodies (such as local governments and school districts) impact their quality of life.

At the same time, those taxing bodies are facing their own concerns in dealing with a downward cycling economy. Faced with decreased government funding, decreased sales tax revenue and lower property tax assessments, each one is struggling to figure out how to weather the coming “storm” without compromising the services we expect from them.

We may not be able to solve the nation’s financial problems, but there is a lot we can do right here at home to minimize the impact of the current downturn on our quality of life. Supporting local business is more important than people often realize. When local businesses ask citizens to try and increase local spending, that request is often interpreted as an attempt by business owners to help themselves. In reality, a strong local economy directly impacts the quality of life for everyone in the community.

Here’s how: With increased local spending comes increased employment opportunities, sales tax revenue, property tax revenues, donations and contributions to local organizations, and much more--all of these things help reduce the necessity of local tax bodies increasing your individual burden or cutting back their services.

When you spend $100 in a Monroe County business, that money circulates through the local economy several times as that business pays employees, turns over its share of taxes, buys raw materials, makes investments, and so on. That same $100 re-enters and bolsters the local economy many times in many different ways that impact the local economy; the technical term for this is the “multiplier effect.” Those revenues help pay for the services that your local taxing entities are trying to maintain…for you. That same $100 spent in St. Louis or on the Internet simply vanishes from this community, although it provides tax revenues someone else. Every dollar you can keep in Monroe County, therefore, is an investment in this community.

Spending locally, whenever and wherever possible, just makes sense. When all elements of the community (i.e., private citizens, school districts, local government, other taxing entities, private businesses, and non-profits) support businesses located within their own community, they are being fiscally responsible--that translates directly into a higher quality of life for the community’s residents.

When we shift a portion of our income that is presently leaving Monroe County for merchandise and services that are available right here and right now, we start to become “conscious consumers”--and that’s smart for all of us!

Jane Kolmer is a member of the Executive Board of the Monroe County Economic Development Council, a public-private partnership that sponsors the “Think Monroe County First!” campaign.