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"We must bring money back down to earth."
This is the first of the Slow Money principles. The third annual Slow Money conference, held last week in San Francisco, drew over 800 attendees, including investors and entrepreneurs who were farmers or working in the farm sector supply chain. The gathering's intent was to help others "learn to invest as if food, farms and fertility mattered."
This event was also birthing something on a broader scale -- a movement dedicated to changing how food is grown, produced and distributed. Slow Money emphasizes creating and sustaining local food systems which support land restoration and preservation with, preferably, local investments.
"Agriculture is not a free market -- there's lots of market intervention," said Jim Slama, founder of FamilyFarmed.org. This has caused striking imbalances in our food ecosystem. Less than .2 percent of the food consumed in Illinois actually came from within the state -- even though Illinois is about 80 percent farmland. Instead, corn (used for ethanol) and soybeans dominate the land.
To counter this situation, the Illinois legislature passed the Food, Farm and Jobs Act, driven in part by the fact food consumed in Illinois travels an average of 1,500 miles from farm to plate. The Act requires that 20 percent of food purchased by state-related institutions come from Illinois by 2020. Additionally, a 2010 study from FamilyFarmed [PDF] shows that just 14 commercial buyers interviewed for the report would buy $23 million worth of Illinois-grown produce -- far more than is currently available for sale in the state.
The "slow" part of the Slow Money equation refers to the inherent timing of sustainable agriculture, which does not conform to the increasingly "fast" food production methods -- e.g. agribusiness using GMOs and raising livestock using antibiotics and hormones -- that seek to turn a fast profit.
"Focus on the value chain -- everything between the farm and the plate," explained Dr. Glenda Humiston from the USDA Rural Development agency in California. "This will translate to jobs."
She touted the importance of regional agricultural value chains, essentially rural-urban partnerships, that will create local jobs related to food support services, processing, packaging and distribution.
California has in the past sent its food out-of-state and even as far away as China for processing. But an investment in infrastructure could lead to a big boom in jobs in the Golden State: Humiston projected an increase of 181,000 jobs (65 percent of them off-farm) in California. The California Financial Opportunities Roundtable (CalFOR) initiative strives to link farmers to entrepreneurs, existing businesses, investors and competitive intelligence information.
Next page: Innovative business models ripe for Slow Money investment
The most pressing structural
The most pressing structural problem with our monetary system seems to be reflected in our definition of the "time value of money" which is critical to how we perceive the "storage of value" in our economy. Money functions much like blood in the body - it's meant to be a catalyst for us to interact to produce real wealth by enhancing our environment with sustainable living systems. Instead we've mistaken the money itself as wealth and allowed money to use us as a tool for raping the environment.
When "time value of money" reflects an expectation of receiving a positive rate of return on the money we hold - then we are all put into a winner-take-all competition to grow our individual piles of money the fastest & we place our "store of value" in the currency rather than the environment. This causes us to rape the environment & social fabric for short term gains. David Korten gave a good example of this when he reported the comment from Malaysia’s minister of forestry who observed that Malaysia would be better off once all it’s trees were cut down since the interest on the money grows faster than the trees.
If money were instead to depreciate in value - then we would recognize that our only true "store of value" is in making a healthy environment to meet our future needs. Currencies with negative interest rates (e.g. flat tax on money or holding fee) promote long term investments by imposing the same 'storage fee on currency' that real assets have.