You could call this “putting your money where your mouth is.” Or perhaps, where your stomach is. As the green investing movement grows, advisers are pondering where we most need to invest in order to build a sustainable world. The answer: invest locally, in healthy soil.
It takes roughly a millennium to build an inch or two of soil, and less than 40 years to strip away an inch by farming that is focused on current yield instead of sustaining fertility. So states the book Slow Money: Investing as if Food, Farms, and Fertility Mattered by Woody Tasch, a longtime venture-capital investor and president of a new U.S. non-profit – Slow Money.
Despite the undeniable necessity of fertile soil to our survival (it’s where our food comes from, for anyone a bit rocky on the basics), we are currently losing about 12 million hectares of arable land annually – or 1% of our global total – due to unsustainable farming methods. We’re also losing experienced farmers, depleting water systems and losing crop biodiversity.
Tasch, who spoke in Vancouver earlier this year, says the key problem behind these (and most environmental woes) is not one of technology, but finance, fallout of a system where investment has become seriously detached from knowledge and relationship. He says investors need to chart the course toward a new economy, where relationships between individuals in a community, and between human society and the land, are resilient and mutually beneficial. Here are a few of his ideas.
“There is such a thing as money that is too fast, companies that are too big and finance that is too complex,” said Tasch. Three trillion dollars circulate through currency markets each day; trading volume on the NYSE passed 100 million shares in 1982, a billion in 1997 and five billion in 2007. Yet we know little about what we invest in.
“We are befuddled,” Tasch said in a recent interview. “We have so much information and so much technological change that we can’t manage it very well, either as a society or as individuals. Yet we still cling to this idea that more is better – faster information, more gadgets. But the empirical evidence about how we feel – it’s out of control, it’s not making us happy. It’s not giving us more leisure or more time. And the level of financial uncertainty has become very high. The idea that your dollars are zooming around the planet investing in things that no one can manage or understand – that’s not a radical statement anymore.”
“The consequences of what we’re doing is removed from our lives,” said Tasch. “It’s so abstract or literally so distant physically from us, behind so many veils and layers of intermediaries, that investors never see the consequences of what they’re doing.”
This creates a disconnect between wealth and long-term well-being, he said. “If you only work with the left side of your brain when you deal with money, if you’re only thinking buy low, sell high, grow your wealth and you somehow think that’s going to buy security for you and your kids, you’re missing a huge part of the canvas. That’s the problem, and we’re starting to pay the price for it.”
“The solution is not going to come top down, from Washington or Wall Street or multinational banks,” said Tasch. “It’s going to come from individuals who just start doing something differently. I’m not a Pollyanna, but I believe the only chance to solve our problems is for lots of people to start taking small steps in the right direction with their investment capital.”
Tasch’s organization, Slow Money, has one goal: a million people investing 1% of their assets in local food systems, within a decade.
“It’s all about reconnecting. If everything is just a transaction, and the buyer never knows the seller, much less ever sees the consequences of anything, then you have one kind of economy. If you start moving toward more relationships where the buyer knows the seller, then there’s kind of a discipline.
“Call it whatever you want – trust, local knowledge, accountability – you’re going to have to see what happens to the investment because it’s near where you live, you’re going to see that person again. Obviously that changes the nature of the investment process and the impact of the investment in a profound way.”
Tasch says investing locally is potentially daunting since the path is uncharted. However, he says, making your capital work for your community is satisfying in a way derivatives will never be.
“When you start connecting to the places where you’re investing, it’s a completely different experience,” he said. “Whether it be a farm or a local housing project, figuring out what’s needed in your community and how you can put some of your capital – even a very small fraction of it – to work locally opens up a whole new kind of engagement for you as a person. It’s going to change your life as a member of a community, even doing it a little bit.”
Learn more about Slow Money (sign the Slow Money principles or contribute to the Soil Trust) at www.slowmoney.org. Next month: slow money options in Vancouver.