Photos show the currency issued by the combined northern NSW LETSystems in the 1990s.

IN THE LATE 1990s the combined LETS systems of the NSW Northern Rivers region — aka the Rainbow Region — issued a printed local currency, possibly the first issue of such currency in recent times.

The currency was negotiable for LETS transactions — LETS is an acronym for Local Exchange and Trading System — by members of Northern Rivers, Nimbin and Mullum Byron Tweed LETSystems.

The full range of LETS local currency

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LETS is a community-based trading system than operates either cashless or with partial federal currency. This latter was introduced in the 1990s so that people could meet taxation and other obligations only serviceable in federal currency. Usually, LETS transactions are negotiated between supplier and user for an agreed price in LETS credits, the transaction being entered on a database and member accounts adjusted accordingly. This enables trading without direct reciprocal exchange, which diffentiates LETS from barter where the exchange of goods and services is direct between those in the transaction. With LETS, you don’t have to swap something of equal value with the person you trade with.

Once, Blue Mountains LETS, a mere 90 minutes by electric train west from Sydney, was the largest such system in the world. Blue Mountains LETS negotiated with the Department to Social Security to clear up ambiguities around beneficiaries receiving payment in LETS for trading in the community. According to Blue Mountains LETS, trading made it possible for unemployed people to maintain their worklife skills and was, therefore, a socially beneficially thing.

One Australian LETSystem — I don’t recall whether it was Blue Mountains LETS — approached the taxation office about paying tax in local LETS currency. Unfortunately, the department declined.

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Australia a LETS early adopter

As I understand the history, LETS was developed in Canada by Michael Linton. He came out to Australia in the 1990s and spent some time here working on LETSystems, particularly one that never eventuated. That was Sydney LETS and Michael and locals working with him envisioned it as a metropolitan-wide trading system.

I recall Michael and the team working into the night at the Old Randwick Community Centre in Bundock Street, not all that far from the newer centre presently being retrofitted for energy and water efficiency and being fitted with a PIG — a Permaculture Interpretive Garden which will serve as a training garden for Randwick City Council’s Sustainable Gardening course for home and community gardeners, and for school and other visitors to the planned education program.

Somehow, the association of LETS with the Centre is fitting as, just down the hall from the LETS office was the office of another metropolitan group that spawned a number of regional sub-groups, Permaculture Sydney. We offered our 110 hour Permaculture Design Course from the premises and out of that grew the Centre’s own community garden — Randwick Community Organic Garden.

Sydney LETS didn’t get quite as far as issuing its own currency, however.

The local LETS currency is explained on the flip side of each note.

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Why northern NSW?

Why was it that northern NSW proved economically fertile ground for the issuing of a local currency?

I believe the answer is due to demographic reasons. The region, particularly the sector inland from Byran Bay on the coast, through the regional small city of Lismore and further inland to the green fields around Nimbin became Australia’s premier counterculture zone in the early 1970s and attracted a  youthful and mainly innovative group of what was then known as ‘new settlers’ — rural reinhabitants whose previous lives had been spent in the cities. These people, searching for new ways of living, created their own culture over the years and, as it and they matured, the milieu proved intellectually and culturally susceptible to novel ideas like starting your own currency.

Seen in this light, the Northern Rivers LETS currency can be seen as a natural outgrowth, as an emergent property, of the culture that emerged in that region in those not-really-so-distant days.

The notes were similar size to federal dollars, looked like money and had a texture similar to federal currency. This afforded them a certain credibility and made use of what people already knew about money. Nimbin Rocks, a prominent local landmark, is seen in the background with the ranges surrounding the town of Nimbin. The snake suggests the Rainbow Serpent of Aboriginal mythology and is a recognition of the place and role of the local Badndjalung people in the landscape.

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Bloom and decline

It was the permaculture movement of the 1980s that had much to do with the development of LETSystems in Australia. Robert Rosen, an innovator in the permaculture approach to economics and ethical investment has written on this website about the history of permaculture’s involvement in community economics through initiatives such as the Permaculture Earthbank. Also at work at the time was social investment innovator, Damien Lynch, who started with August Investments (still going) and went on to help found Australian Ethical and Ecoforest Pty Ltd.

In many ways, the permaculture of the 1980s was quite different to what it is today. Then, there was, proportionally, a great deal more focus on and involvement in things economic and community development than, perhaps, there is today. For one thing, the ideas of EF Schumacher, the British economist who wrote Small Is Beautiful – Economics as if People Mattered were more in the forefront or permaculture thinking. There was an active interest in technologies such as the intermediate or appropriate technologies championed by Schumacher. There was also influence from an economic-oriented US group, the Schumacher Society.

Some of those early permaculture adopters had a more social focus to their use of the design system, being involved in community work of different sorts. Being both a part of mainstream society and at the cutting edge of a new social movement, it was more or less natural that they would turn their attention to innovations like LETS when it came along.

Soon, regional permaculture associations had adopted LETS trading. Then those in the permaculture of that time let it go where it wanted to go. LETS spread and broadened and the golden age of LETS in Australia dawned like a warm orange sun coming over the horizon.

This was the 1990s. Around the start of the new century however, the number of LETSystems had gone into decline. “What’s happened to LETS?”, was a question that you would be asked. Blue Mountains LETS shrunk as did others. LETS survived, but as a microcosm of its earlier promise.

I don’t know why this happened, why something that caught the public imagination and bloomed went into sudden decline. Was here insufficient popularisation and recruitment into LETSystems? Was it that people became wealthier and found no need for LETS? Did development of the system fall below a critical level? Did permaculture change and take on a new focus?

One explanation I have encountered a number of times is that you couldn’t buy all that much by way of daily living necessities through LETSystems. It was easy to trade for a massage or some similar service, but an incapacity to buy food, construction materials and some skills became LETS’ weak point. This might be something worthy of the emerging community currencies mulling over.

Images of local wildlife lend the LETS notes a bioregional character and suggest coexistence between nature and human culture. The scene depicts the broad expanse of water that is Byron Bay and beaches stretch far to the north. The prominent peak on the horizon is Mt Warning, named by Captain Cook the navigator on his 1770 transit of the Australian East Coast. Mt Warning, the first point of the Australian maintand to be touched by the morning's sunlight, is flanked by the Border Ranges, the political boundary between the states of New South Wales and Queensland.

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A new dawn and rebirth

It was only a couple days ago that someone said this to me: “You know, those things we were ivolved in years ago are only now coming into their own time”.

What he was saying was that we should be cognisant of the ideas innovation curve when we look back on these innovations in social history, such as permaculture and LETS. All new ideas are born of innovators on the creative fringe of society, are taken up by early adopters who tweak the innovators’ ideas and make them workable and then are taken up by early and later mass adopters.

Could it be that this early phase of LETS, whose history I have briefly described, was the innovator and early adopter stage? And that what we are now seeing with what seems to be a creeping popularity of LETS and local currency ideas being the start of a late early adopter phase, a time when the wrinkles of those early attempts will be ironed out of the fabric of community econmics and newer, better systems developed? Could this be where the work of the Transition movement in local currencies fits into the development of the idea?

I hope so. The continuance of LETSystems suggests a level of popularity for an idea that persists. It may be that the permaculture movement and the first phase of community economics focused on LETS in the 1990s has unconsciously handed on the idea to the emerging Transition movement and that it is here that we will see the action. People and ideas, we know, flow from place to place and come together in new milieus that emerge from the turmoil and churn of societies and global trends. This would comply with a trend that has seen ideas popularised in the permaculture movement only to be taken up and developed fully by organisations and movements beyond permaculture.

Whether these are the social dynamics that will recreate those early innovations in LETS and similar schemes as something new and exciting enough to capture the public imagination will be known in time. Let’s watch and, perhaps, help make it happen.

More on LETS in Australia: Find links to LETSystems across the continent — http://www.lets.org.au/

The echidna is found is the forests of northern NSW where it digs for insects with its long snout. It is another of the local wildlife to appear on the notes.

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Michael is an economist and attorney and a member of BALLE — the Business Alliance for Local Living Economies. Australia has no equivalent of this organisation that is active in 60 US cities and boasts a business membership of 15,000 locally owned businesses.

“It is a movement for, not against”, emphasises Michael. “It is not an oppositional movement. We’re not saying that non-local business is bad. It just doesn’t contribute as much to local jobs or community wellbeing”.

Benefits of locally owned business

It is this economic argument that is at the core of Michael’s message of economic localisation. And it’s a message Australian audiences heard when Michael spoke in a number of Australian cities in June 2009.

In Sydney, he appeared at a Sydney Food Fairness Alliance (SFFA) lead up event to the October Food Summit at the city’s presigious Customs House at Circular Quay. That kicked off  the development of a food policy for NSW (more at: www.sydneyfoodfairness.org.au).

Michael also appeared at an Eastern Suburbs council business breakfast, a seminar for sustainability educators with the theme of ‘bringing economics into sustainability education’ and at a Transition Sydney Cafe Conversation where he outlined the importance of strong local economies to cities seeking to become more resilient to changes in the global marketplace and to other influenes coming in from outside. His appearance at an event organised by the SFFA is no accident. Michael is a passionate advocate of the economic common sense of localised food systems.

Unlike many locally owned, small to emdium sized businesses, Michael says big business packs up and leaves when times get tough or when goods can be produced cheaper elsewhere and where, perhaps, environmental and workplace safety and working standards are lax.

We need look no further than Australia’s foreign-dominated automobile manufacturing industry for evidence of this. For years, successive and gullible Australian governments have handed over tens of millions of Australian taxpayer dollars to retain these industries in sensitive electorates.

Attracting the creative class

In what has essentially been a corporate welfare handout, the question was seldom asked about whether we should say goodbye to these old manufacturing industries and put the money elsewhere. Put it into new, design-based, knowledge intensive and locally owned creative industries, for example.

This would attract to those cities that deliberately set out to attract them what author, social scientist and economist, Richard Florida, calls the ‘creative class’ (see Amazon.com reviews of his books The Creative Class and The Flight of the Creative Class). This is an emerging socioeconomic group that consists of a broad range of knowledge workers employed in industries such as design, the arts, education, publishing, medical science and services, media, entertainment and various service industries. Add to this a diverse industry based on the supply of local grown and produced, nutritious and clean food marketed in imaginative ways, plus the development of other products and services that draw from local resources and knowledge, and you have the potential for a viable regional economy.

It is they, rather than the old industries that have their origin back in the earlier Twentieth Century, that develop and introduce the new ideas and new technologies and that develop the creative content for online and other media. Seen as an ascendant socioeconomic group, the creative class has the capacity to move local and regional economies away from the established manufacturing and other sectors and, among city authorities with an eye on their economic future, is seen as a core group to attract.

The value of this creative class to local and regional economies is that they often cluster in small to medium sized business which, where incentives exist, can resurrect and redirect failing economies. Rather than continue to prop up old, uncompetitive industry from the industrial past, better to redirect the funds to creating the environment in which these new industries can develop and thrive.

If Michael makes one point, it’s that locally owned industry is likely to stay around when the going gets tough. He’s not talking specifically about large scale industry, for Australian owned big business is just as footloose as any other. What he’s talking about are those small to medium scale business that populate our cities, the kind that might employ relatively few people on a business-by-business basis but that, collectively, employ millions of Australians.

Local stays local

It’s Michael’s research and economic nous that has led him to championing local food systems and locally owned business. He says that, where food businesses choose to sell the local product, one of the benefits is a reduced carbon footprint due to the shorter distance food is transported and the fewer greenhouse gases emitted. We are familiar with this argument as ‘food miles’, though those whose interest is the sustainability of the urban food system recognise that it is only one factor in estimating the sustainability of a food system.

Like other advocates of food localisation, Michael’s use of the term signifies food grown or produced in the rural hinterland of an urban area and consumed within that area. ‘Local’ food is a term synonomous with ‘regional’ food. The size of this urban ‘food bowl’, as it has been named, would be relative to the scale of the urban area it serves, and its population. Guessing, Sydney might derive its food supply from, say, about 300km around the city. Sydney’s fresh food supply, including some fruits and poultry, might be obtained from a region extending from the Hunter Valley in the north, through the urban fringe market gardens to the north west and south west of the metropolitan area and south to the Illawarra. This, after all, is the greater urban and nearby rural conglomeration that makes up Greater Sydney as a twenty-first century city in the same way that Brisbane can be considered to consist of a greater metropolitan area made up of the Sunshine Coast, Brisbane and the Gold Coast.

For smaller cities the food bowl would presumably be smaller, agricultural conditions in the hinterland being viable. Substituting imports of like-food with the locally produced might help develop local economies.

Also worthy of consideration in any assessment of the potential for a local food economy would be the impact on local, small business of opening a supermarket in an area. That impact is well documented. With their capacity to open seven days a week and for extended hours, and with parking spaces provided, supermarkets and malls can suck the economic energy and social vitality from traditional, streetfront shopping strips.

This was one of the reasons behind the opposition to Coles’ move into the south-east Queensland town of Maleny and the northern NSW town of Mullumbimby. Where Australia’s supermarket duopoly – Coles and Woolworths – that together controls much of the Australian food retail industry and the diets of Australians – does not compete by opening big box malls, it sets up imitation local, small businesses to compete directly with local specialty food retailers. Such is Woolworth’s Thomas Dux chain of specialty groceries. The supermarket industry’s economic and dietary impact has also been seen in the purchase and closure of the Macro wholefood chain of shops, effectivly reducing food choice for Australian organic food eaters.

Increasing competitiveness

So, what can locally owned business do to increase its competitiveness with the ‘big box’ retailers (so called because of the windowless, inwardly-focused buildings cut off from their environment that they inhabit)? Plenty, according to Michael Shuman.

Some of his proposals we already see in Australia – the rapid growth of farmers’ markets (though the term can be misleading: some so-called farmers’ markets are simply resellers markets, the food coming from the city wholesale markets rather than from farms) and direct distribution through home delivery services, especially those specialising in organic product lines as well as community-supported agriculture.

Michael’s proposal that locally owned small business seek to occupy a niche is already seen in streetfront commercial strips where delicatessens and stores catering to ethnic diets are found. The advantage of this is easily tested by walking into a Woolies or Coles supermarket and looking for organic foods. You find some, but there is no depth to the stock they carry, it’s just the best selling lines with no shelf space given to less popular but still in-demand lines. That is found only in smaller retailers catering to niche markets.

What, then, can locally owned retailers do about this intrusion by the economcally powerful supermarkets? According to Michael Shuman, they can promote their local ownership and the fact that local business is less likely to pack up and leave town when economic conditions detoriorate. They can also play on the reality that a greater portion of the money spent in local businesses is in turn spent by them in the area, on legal services, advertising, stock, stationery, tradespeople and so on. To buy local becomes a local economic multiplier.

He mentions other strategies for locally owned business such as the creation of shopping destinations that draw people away from the big boxes. This might look something like a big box, he suggests, but would consist of a large building containing independent, small scale retailers. There would be, in addition to specialist, niche food retailers, those selling the lower priced vegetables/fruit/grains that form our staple foods, cafes and coffee bars and, perhaps, a bookstand specialising in cooking and gardening books. Retailers supplying the ‘long tail’ of lower volume goods for which there exists continuing demand is another opportunity. This is something that supermarkets simply cannot devote their valuable shelf space to.

Hearing this, a couple pleasurable hours I spent wandering around the Adelaide markets came to mind — certainly a more interesting, more pleasurable and more culinarily delightful experience that doing laps down the supermarket aisles. The good thing I noticed abut the markets was that you could get those upmarket, more expensive food products that we might regard as occasional treats as well as the more basic vegetables, fruits, culinary herbs and grains, cheeses and dairy, pastries and breads that constitute the affordable food supply. And — there was both organic and non-organic in some lines.

Local government can help

It turns out that local government has a role to play in improving the viability of locally owned business.

This it can do through procurement policy – choosing local goods and services rather than those produced elsewhere – and making sure its community services purchase perishable foods produced within the city’s food bowl. Councils might not presently do this because they choose not to favour particular businesses, however the case for deliberately choosing local is perhaps more valid because local government then fulfills its mission to improve local conditions, and that means the local economy with all of its multiplier effects. After all, surely local government should have a built-in bias towards supporting the local.

First, plug the leaks

In systems thinking, it is axiomatic that the process of creating positive change and innovation lies in creating the environment in which such properties can develop and flourish. So, how do organisations supporting local economic development go about creating the conditions within which local business – and that includes not-for-profit, community and social enterprise too – start? By identifying the economic leaks and plugging them with new businesses, says Michael. Start to plug those gaps and you start to get your local economic multiplier effect.

This was the motivation behind a community enterprise, the Manly Food Cooperative. Well over a decade ago the Coop identified the need for a source of food that was primarily organic and that produced minimum packaging waste. The gap identified, the Coop has retained its support despite the presence of at times two organic food retailers in town and two Coles stores which also carry (minimal) organic lines, though those are not minimally packaged.

It was similar for the financial services business, August Investments. August was the creation of social (‘ethical’) investment pioneer, Damien Lynch. Damien saw a gap – a monetary ‘leak’ in the market for people wanting to earn investment income without contributing to damaging environmental, social or financial impacts. August is still in business, more than 20 years since it first offered its portfolio. And, it’s still a small, locally (Sydney, that is) owned business.

In Brisbane, after Michael’s appearances, bold and future-oriented people voted with their dollars to act on improving the city’s local economies. Inspired by Michael Shuman, they chose not to sit back and let his ideas wash over them. They acted, and in doing so added the element of economics to sustainability.

Michael works with the Business Alliance for Local Living Economies in the USA. He was the second local economics advocate to visit Australia from that country whose visit had been organised by Ken McLeod, now with the Wollumbin Institute, a regional, sustainability-focused organisation active in Northern NSW. Judy Wicks had been the first. Proprietor of the Black Dog Cafe in Philadelphia and local economics maven, she attended Brisbane’s Go Local conference a year ago and made an appearance in Sydney, bringing news of practical examples that showed how economies could be local, efficient and viable rather than big, anonymous and footloose.

A man perhaps in his early fifties who lives in Washington DC, Michael is an economist, attorney and advocate who brings passion to his presentations. He believes that locally owned business has a key role in making regions more resilient to the impacts of fluctuations in global markets and to other disruptive events affecting them from outside. Trading in locally produced and consumed goods and services extracts more value per dollar for local communities, and this strengthens regional economies. It was this that attracted economic development people and others from the Transitions movement to Michael’s appearances in Brisbane and Sydney.

Entrepreneurs of a localised economics at the Eastern Suburbs councils business breakfast - (left) Michael Shuman and Damien Lynch. Sydney-based Damien started the social investment ('ethical' investment) industry in Australia with the launch of August Investments in 1981.

The economics of sustainability

Economics is one element of sustainability, a set of practices that also includes in its ambit the natural, rural and built environments and that is captured in the sustainability troika of business, governance and civil society. It is this tripartite structure, made up of society’s major segments, that is the necessary combination that moves us forwards along the transition to sustainability. It is also what separates sustainability education and practice from environmentalism, which usually takes a narrower focus on natural environments. A few established environmental organisations, now, are starting to broaden their ambit to include the urban and social environments.

Michael Shuman’s ideas add an economic dimension to the conversation around sustainability, one illustrated by the numerous examples he provided in his talks and one largely missing from the conversation.

Appearing in Sydney at the end of his Australian speaking tour, Michael’s was an intensive end to a successful series of appearances. News of his impact on audiences had preceded his arrival in the city and had been carried through the digital channels of online networks. For those oganisations that had a role in planning and managing his speaking engagements, especially those in Sydney, the reward was in reaching people usually outside of their ambit, extending the knowledge of their presence and agenda and opening them to new people and, perhaps, new alliances.

Conversation with educators

First up for Michael was a meeting and conversation with Sydney sustainability educators. Organised by Fiona Campbell, Sustainability Education Officer with Randwick City Council and held at Randwick Community Centre, the meeting attracted a sizable group of local government sustainability and environmental educators including those from North Sydney, Pittwater, Manly, Leichhardt, Bankstown, Hornsby, Willoughby and Rockdale councils; a researcher from UNSW; economic development people from the Macarthur Business Enterprise Centre, Fairfield and Kuringai; an educator from the Australian Museum; an Urban Sustainability Support Officer (who supports councils in their sustainability work); an Eastern Suburbs community-based educator; and a woman from a community-based Transition Initiative/education group in Katoomba.

The theme of Michael’s presentation was ‘bringing economics into sustainability education’. For some there, this was a new idea, economics not having been a part of their educational agenda.

Dinner with TransitionSydney

A little over an hour later, and Michael was at the Fair Trade Cafe in inner urban Glebe for a TransitionSydney Cafe Conversation. The entire back room of the Cafe had been booked out, however these still wasn’t enough space for all who wanted to come. A waiting list had been started.

It was a full table at the TransitionSydney Cafe Conversation with Michael Shuman.

This was in the informal, conversational style tradition of TransitionSydney’s Cafe Conversations, such as that convened previously for Robert Pekin of Brisbane’s Food Connect, a successful CSA-type local food system. The event was noteworthy in that it demonstrated the capacity of TransitionSydney to reach out and attract participants from outside its membership and from outside the permaculture milieu that forms a substantial chunk of transition groups in Australia. It also demonstrated the effectiveness of the less-formal conversation format that encourages attendees to participate in conversation rather than sit quietly as passive recipients of a presentation. Oh… no Powerpoint either… just an informal discussion.

Attendees included what might be termed ‘mainstream’ people such as those from the corporate world, local government, universities, an agricultural biodiversity group, food writer John Newcombe and another journalist whose name tag merely identified her as ‘De’, the organiser for the Organic Traders and Consumers Network — an influential organic food industry body in Sydney — an event organiser and others including the team from the new TransitionMarrickville group. They came from inner Sydney, the northside, Eastern Suburbs and as far away as the Central Coast. Asked how they found out about the event, their answers disclosed the effectiveness of promotion through the various email networks.

MIchael Shuman makes the point about Transition Town initiatives needing to develop strong, local economies

Full day flat out

Business breakfast

Thursday was a full one that started early with a business breakfast at Bondi Bathers Surf Lifesaving Club at Bondi Beach, organised by the joint Woolahra/Waverley/Randwick council eco-footprint program that seeks a reduction in the bioregion’s environmental and resource-consumption impact, and that is led by Randwick City Council’s Richard Wilson.

Outside was a clear, glorious Eastern Suburbs winter morning where, seen through the Surf Club’s tall, arched windows, a vividly blue Pacific cascaded as lines of foaming swells onto the broad, yellow sandy swathe of Bondi Beach. Inside, Michael addressed a mixed group of Eastern Suburbs small business people, the City of Sydney’s economic development officer and another from the Darlinghurst area, local government staff, an ALP councillor and Damien Lynch, the originator of the social (ethical) investment industry in Australia who started the country’s first social investment opportunity, August Investments, in 1981.

Organisers of the business breakfast with Michael Shuman - (from left) Celia Bustead (Woollahra Council environmental educator); Michael Shuman (Business Alliance for Local Living Economies); Richard Wilson (Eastern Suburbs Ecological Footprint officer); Fiona Campbell (Randwick City Council Sustainability Education Officer).

Hungry for Change, a public forum

Early afternoon took Michael to the formal sandstone grandeur of Sydney Customs House at Circular Quay that the City of Sydney had made available to the Sydney Food Fairness Alliance (SFFA). The Alliance is the organiser of Hungry For Change, a public forum that was designed as a lead-up to the October Food Summit that will see the start of developing a food policy for NSW.

SFFA is a coalition of health and nutrition workers, sustainability educators, local government staff, representatives of a social justice institute and the church, the Organic Traders and Consumers Network, people involved in community food systems — including the Australian City Farms & Community Gardens Network and the Organic Hunter/Sydney/Illawarra food system — farmers from Sydney’s periurban agricultural region, the Red Cross, university researchers and a representative of the permaculture design system and TransitionSydney.

The forum was offered as an afternoon event that was repeated in the evening for those who worked during the day. The afternoon session was fully subscribed and drew the greater number of people. Even then, there was a waiting list of those wanting to attend.

Michael linked his proposals for economic reform with research, funded by the Kellogg and Gates foundations, that he has been conducting into local food systems in the US. Following his presentation and a break for coffee and nibbles, a process based on the World Cafe model made it possible for participants to develop ideas to be taken on to the October Food Summit. Themes were set up on different tables and participants moved from table to table to generate ideas.

This approach structured the event as a participatory one that harvested audience input, giving participants a voice in the Food Summit. Once again, participants represented a broad swathe of society that demonstrated the capacity of SFFA to communicate with and appeal to a diverse milieu. The event was organised by a team that included people from the SFFA, Woolahra, Waverley, City of Sydney and Randwick councils and TransionSydney. City of Sydney had generously made a grant available for Hungry For Change, as well as the excellent Customs House venue.

Farewell Sydney

It was a weary Michael Shuman who was dropped off at Sydney airport’s international terminal on Friday morning for his 14 hour fight home to Washington DC.

The success of Michael’s appearances made clear the value of organisations forming partnerships to share resources and expertise for a common endeavour.

For the SFFA as well as TranstionSydney, his visit opened new intellectual territory and gave them access to people who are not usually associated with those groups. For those in other states, his talks were stimulating, so much so that, after Michael’s inspirational Brisbane appearances, a businessperson put $5000 on the table to start a local, small business organisational initiative. Within two days that sum had grown to $36,500. Now, that’s enthusiasm… that’s acting on inspiration.

Note:

Michael as brought to Australia by the Wollumbin Institute.

His Melbourne tour was managed by Amadis and Gilbert Lacheta, the stylish and more-than-capable team at the Village Well consultancy.

Michael’s Sydney visit was via a cooperative partnership consisting of the Sydney Food Fairness Alliance and Woollahra/Waverley/Randwick councils eco-fooprint program in cooperation with Leichhardt Council, City of Sydney, TRANSITION sydney and NSW Early Childhood Environmental Education Network.

Support for Michael’ appearances was facilitated through the generosity of City of Sydney in the form of a grant, the competent services of the city’s communications department and the City’s making available the Customs House at Circular Quay for the SFFA’s Hungry For Change event.

View photos

Read about and view photos of local economic systems advocate, Michael Shuman’s Sydney events: http://www.facebook.com/pages/PacificEdge/46128279174

GO LOCAL. That’s the suggestion of NSW North Coast community educator, Tim Winton, for coping with what he sees as the approaching peak oil crisis.

‘Peak oil’ describes the reaching of a peak in global oil production. After that, an inevitable decline kicks in, with increasing scarcity and rapidly rising prices. Far from being the idea of doomsayers, economists and the petroleum industry are taking it seriously. The basic underpinning of industrial economies may be about to disappear.

Tim Winton

“Decline will follow the peaking of oil extraction”, warns Tim. “Economists say we have 30, perhaps 40 years before the supply reaches its peak but others put the time as much less, some as little as five years. I believe the economists are a little over-optimistic. Whatever the figure, it leaves precious little time to develop alternative sources. The International Energy Agency says it will take around 30 years lead time to scale up alternative energy sources to avoid economic dislocation”.

Peak oil seems to have come out of nowhere. According to Tim, oil interests did not want to scare investors and so have given the concept little publicity. But some did see what is coming, he says. “It is interesting that BP – British Petroleum – changed its name to ‘Beyond Petroleum’ and that Shell is also looking beyond the petroleum age”.

Potentially worsening the decline in supply is the likelihood that, soon, we may be asked to share a declining oil resource with millions more people in China and, still to come, India. Assuming no alternative energy source comparable with oil is found, the impact will likely be the acceleration of price rises and a more rapid shrinkage of remaining reserves.

A reduction of supply (however long it takes) that follows the peaking of supply will push up prices of most goods, including food.

Prospect for alternatives uncertain

A decline in the supply of oil has stimulated the search for alternatives to replace it. The fact that the market usually finds substitute products for those that go into shortfall has become almost an article of faith for free-marketeers – it was put forcefully by the late US academic economist, Julian Simon. The belief, though, has more to do with faith than with science. We must not assume because something usually happens that it will continue to do so.

So, what are our alternative energy options?

Biodiesel

Biodiesel is produced in the town of Nowra an sold in Sydney service stations. At present, it is the fuel of choice only of early adopters, however for the initial phase of any post-peal oil shortfall, biodiesel may become the fuel that moves the nation. What holds it back is the lack of an Australian standard governing its production.

Hybrid vehicles – extending a limited fuel supply

These are the fuel-efficient, hybrid drive vehicles such as those manufactured by Toyota and Honda.

Hybrids combine a conventional petrol engine with energy fed into a lithium-iron battery that is used to power the vehicle at certain times. Hybrids are substantially more fuel efficient than conventionally powered vehicles and their number is likely to multiply on our roads.

The hydrogen economy

There exists the expectation that the ‘hydrogen economy’ will save the day.

If hydrogen energy proves economically and technically viable, that will be good news given our reliance on the long-distance road transport of goods and the lack of public transport in some urban regions.

Hydrogen looks promising as a transport fuel, but we must be careful not to assume that it is the only answer and stop funding research into other sources of energy.

As for finding a substitute transport fuel in time, hydrogen-powered vehicles using fuel cells already exist as prototypes but the fuel cell is still some years from mass adoption.

Renewables not a new solution

Renewables would form part of any future mix of energy sources.

Commercial wind energy is already generated in south-eastern Australia but, like other renewables, it is of no use as an alternative transport fuel. Similarly, other point sources that are geography-dependent and have to be sited where wind, tides and sunlight are most plentiful and constant. It might be possible, however, to substitute renewables for some non-transportation applications presently served by oil-based energy.

“I expect a big push by the nuclear industry as peak oil sets in”, says Tim, though that may be more pronounced in countries without the coal reserves of Australia. Already, China is interested in sourcing uranium here. In the West, proposals for new nuclear stations are likely to come up against the NIMBY syndrome even among people who otherwise support its development.

Oil, innovation and the 3000 mile ceasar salad

When Tim Winton addressed a seminar on peak oil at the Byron Bay Community Centre this year, so many turned up that people had to sit on the floor. Others spilled out of the doors. This level of interest surprised Tim and indicates that, in this part of the world at least, peak oil is something that is starting to capture the public imagination. The audience had come to hear about the potential impact on the region and what they could do about it. Tim proposed that localisation might offer some solutions.

“The economy will not grow if the energy supple does not,” Tim told the audience.

“Yet, this can be seen as an opportunity. The Northern Rivers could become a world leader in what to do in a situation of scarcity and there are things we can do both personally and as a region.

“On the personal level, avoid debt. On the community level, invest in the regional economy. Reduce car-dependence and adopt pedestrian-friendly urban planning. Develop local sources of energy such as biofuels, solar and wind. Adopt energy conservation.

“We need to educate and make people more aware of the situation. Importantly, we need to work out how to do more through good design”.

The challenge of peak oil would be expected to generate a climate of doom and gloom, however this is not what is happening. There is optimism that the Northern Rivers region could become a leader in a peak oil future.

Byron the leader

“Byron Bay has the climate for doing things sustainably and for leading Australia”, claims Sarah West, a Lennox Head environmental scientist who works with local town planner, Geolink, and who previously worked with Sydney Water.

Politics – it’s the only way I know to get things done in a reasonable time

“Prices will go up as supply declines – and that includes water, goods, fuel and food. You might know that much of our food is transported great distances – this is the scenario of the ‘3000 mile Ceasar salad’. We can do much by deciding to buy local foods and locally-produced goods. We need to decentralise”.

Byron Bay’s Green’s Mayor, Jan Barham, agrees and encourages residents to feel motivated rather than discouraged.

“We live here because we are a bit smarter than the rest”, she says with an air of mock smugness, “ …and we stand up for what is right. There’s enough of us here to make a difference. You’re only going to show the world what’s possible when you have a bold community. Let’s stay positive”.

Barham disagrees with avoiding conventional politics in the search for solutions: “Politics – it’s the only way I know to get things done in a reasonable time”.

A regional future?

Supporting and investing in regional economies by buying local is not a new proposal – it has been encouraged by business in areas of declining local economies and by advocates promoting the partial-decoupling from the global economy to preserve local jobs and the viability of towns.

What is new is proposing localisation as a means of reducing oil consumption. Localisation as an economic and cultural solution has been explored by commentators such as Michael Shuman, attorney and director of the US Institute for Policy Studies who wrote Going Local – creating self-reliant communities in a global age (1998; Simon & Shuster, NY).

The Northern Rivers is a growth area that attracts seachangers and downshifters, people who are part of a well-educated and affluent demographic. Despite the potential for innovation coming from these human resources, localisation can do only so much to reduce reliance on high-priced oil. There might be potential for the region’s farmers to grow crops for the manufacture of biofuels such as biodiesel, however the economics of processing within the region – and whether sufficient raw material could be produced here – has never been assessed.

The North Coast cannot avoid the negative impacts that could come with peak oil, however a new localisation might reduce them to some extent. To what degree that is possible will depend upon the availability of local finance and initiative.

Any peak oil coping strategy will have to motivate the region’s innovative citizens and its social and economic entrepreneurs. Motivated by rising transport, goods, food and petrol prices, even the region’s environmentalists might look beyond trees and forests at the very infrastructure that supports the way they live.