Franz Nahrada / From Suburbia To Global Villages /
Economic Power Of Sustainable Development







One of Josephs steadfast motives was to prove sustainable development was not only able to pay for itself, but also would create massive savings and set resources free for other endavours. I was, from a European perspective, a bit astranged by this: we in Europe deeply distrust private wealths inherent ability to create anything substantial for the public good. We doubt if even distributed wealth works without a strong covenant. Joseph told me that as a planner he has given some examples of how to reach such a covenant - by including new principles about the functionality of life public authorities ususally disregard.

So I wanted to have a deeper look into the matter. Maybe the best description of Josephs ideas and the way he puts them to action is the speech that he later delivered at the Global Village 1995 conference. So I will quote and comment on this speech for a while.

My formal training is in the field of architecture and planning. My business interest is that of designing and building planned eco-communities, each with their own renewable resource systems. My vision is to implement worldwide a strategic plan for funding restoration of the natural environment by designing and building these new planned eco-communities; by transforming existing communities and cities into such eco-communities and eco-cities; and by developing micro-climate agro-food forestry farming systems. By setting in place such renewable-resource farming systems in combination with eco-community development strategies, humanity can protect the web of life. (The beautiful biosphere). By living in eco-communities and eco-cities we conserve resources and eliminate harmful pollution. By creating micro-climate agro-food forestry systems we create sources of renewable wealth and eliminate open field erosion and the need for chemical farming. We also eliminate the need to disturb old growth forests, the habitat homes for so many of earth's life forms.

From the beginning there was a bit of controversy in our view of nature. While I am holding the view that great civilisations have even contributed greatly to the genetic variety of plants and animals (a view strongly supported by my friend Uwe Plachetkas findings about the Inka culture and the work of Soviet botanist and geneticist Nikolai Ivanovich Vavilov [1]), Joseph was more fond of natures autonomous development. I favored the "cultural landscape", he was very much in defence of "natural landscapes". I think this is a productive tension and I will later come back to it - since this is a much more complicated issue.

Lets continue with Josephs Story here, as he delivered it in 1995.

Building Glade Spring

My first experience of eco-community building, called "environmental planning," at the time - was in 1971 in the Allegheny Mountains near a small town named; Manns Choice, Pennsylvania. My partner and I made a down payment on 450 acres and began a four year process of planning and building the rural community known as Glade Spring.

The community was located on a beautiful site of sloping wooded hills with spring fed streams leading through deep woods with high open meadows which over-looked 20 mile views of the valley. It was our dream came true. We created 25 wooded home sites of 10 to 15 acres, each with views of the valley, sharing 130 acres of community owned property called the parklands or commons. The parklands were composed of the high meadows, a 100 year old farm house, barn and stables with beautiful views in all directions. Also included was a 10 acre lake called Lake Francis, ringed by a pathway to the famous "rope swing," a jumping off place!

In addition to having great fun creating Glade Spring, designing and building most of the homes and living there for 5 years we learned the benefits of combining private and common ownership into each deed. While each property owner privately owned 10 to 15 acres, the property owners also owned an "undivided interest" in the 130 acres of parkland or commons. Covenants were recorded in the county court house and require unanimous consent to be modified. The covenants stay with the land giving each land owner personal power to protect the entire 450 acres. The community covenants prohibit further subdivision of the land, disallow hunting, motor bikes, and motor boats, etc.

Today, Glade Spring is just as beautiful as the day we left it, many years ago. The only difference is all the new grandchildren swimming in the lake. As Marshall McLuhan said, "we experienced far more than we understood."

I came away from the experience appreciating the comfort of an extended family of neighbors sharing ownership of community owned property and the unique gifts and personal expressions brought by each community member and by the rural neighbors of the surrounding area who also shared in our community experience.

Now, 25 years later, I find myself focused on the same basic interest. Even though the communities are larger and much more complex with new words to describe them - two points are clear, eco-communities must be enjoyable, protect the land and be profitable for builders and inhabitants, or they will not be built. The good news is they are all these things and more.

Glade Spring may seem just a few houses, but even in this early development some features of Josephs approach are very visible. In a mail exchange he told me that the majority of the land was dedicated to public interest and that there was no such thing like "tresspassing" - something which was deeply disturbing for me in Europe. Common ownership, however, would strengthen community participation:

I now live in a place in Arizona in Cottonwood, the "Verde Villages". There is a community association - that few take part in. I say this is because there is - no community owned property - no community owned asset to focus on. People simply own their own homes. The association sends out a news letter trying to get people to take part with little success. The Glade Spring association - in contrast - has a very active membership for almost 40 years now. The key is access and pride of ownership of "Real Property". Good old American capitalism working well. As you know my mission is to take this "idea" to much larger and more complex scales.

here is the rest of Josephs speech, yet uncommented:

During the Global Village conference, held in June of 1993, a number of papers were delivered about walkable eco-cities and the need for eco-community building. The paper I delivered was entitled New Spaces for Living. It addressed the benefits of walkable eco-community living and the economic power of sustainable development. The paper opened by encouraging Austria, and Europe as a whole, to learn from America's mistakes over the past 50 years and work to avoid repeating them, in particular those concerning auto-centered land use. By auto-centered I mean living in communities where you have to use a car for almost everything. Most of America, and most of the world, still assumes this kind of living creates economic advantage.

As we learn more; auto-centered living will reveal itself as the massive economic, social and environmental disaster it is. While people existing in auto-centered communities are stuck in traffic and enveloped in pollution, people living in planned eco-communities will have already taken a walk in the clean, quiet morning air, made their first business deal of the day and be on to the next one which can happen while walking in the community plaza or sitting in a fresh air outdoor cafe. In Italy it is said, "if you want to meet the important man go to the piazza."

Economic Advantages of Planned Eco-communities

Powerful economic advantages of living and working in eco-communities includes: The increased opportunity for inhabitants to meet each other and develop mutually beneficial relationships. When people find themselves in pleasant, safe, pedestrian oriented circumstances it is easier to take part in positive social exchange.

In June of 1992, during the Earth Summit for the Environment and the Global Forum held in Rio de Janeiro, Brazil, a heightened example of this took place. Some 40,000 participants came from all over the world to take part in the two week event. The Global Forum, a meeting of non-governmental organizations from all over the world, was held in Balboa Park on Rio's waterfront. The large park held over 20 tents for speakers and performances. Speeches and performances were given each day all day for two weeks! Eight hundred booths for organizations and green-technology displays lined paths connecting the tents. There were also temporary patio cafes set up along the pathways, providing participants and visitors alike, places to eat and relax. Over 250,000 people visited the park over the two week period.

We felt overwhelmed with the concentration and wealth of human resources who had come together from so many different places. The challenge was, "how to meet them all" and have meaningful exchanges.

As time passed, people started saying they were living in "Rio-time", people were finding themselves standing or sitting next to the very person they had wanted to meet with next, and this happened over and over again for thousands of people for the entire two weeks of the event. Living in "Rio-time" was defined as the "Magic of Rio." I say it was the "magic of being in a friendly walkable environment", the perfection of the "accidental meeting" or natural synchronicity at work. By the end of the third day people were typically dropping their calendars of events and just "going with the flow'' and totally enjoying the surprise of sitting down to lunch and noticing the person they had hoped to see that day, sitting at the next table. The U.N. "Earth Summit on the Environment" itself was attended by more heads of state and key government officials than any other single event in the world's history.

The "Rio-time" story is told to underscore that in planned eco-communities where interesting people focus on interesting things and choose to meet in friendly pedestrian-oriented circumstance, the possibility for a "Rio time experience" or "synchronistic experience" with meaningful dialogue is greatly increased. Again, when people find themselves in pleasant, safe, pedestrian oriented circumstances it is easier to get to know each other and to take part in positive social exchange. A second powerful economic advantage and aspect of this involves the savings of time. How much time is spent traveling to meetings, traffic jam's, finding parking spaces, auto maintenance, auto accident related law suits, traffic school, hospital time, rehabilitation time, etc.? Living and working in an eco-community will save a person at least two hours per day of logistical time, time just moving around getting things done. If so, a person could save 14 hours a week or 728 hours a year. Based on a work week of 40 hours this could be the equivalent to 18.2 work weeks or 2.2 months of extra work time or "free time" per year.

If the Los Angles metropolitan area has 4 million workers; 2 hours saved per day equal a savings of 8 million hours each day or 40 million hours per 5 day work week, or 2 billion hours per year. At $10 per hour that would equal; $80,000 million a day; $400 million per week; or $20 billion per year. Non working people would also save logistical time which also saves money and will be added to the above savings.

What each person will do with their new found economic advantages is unclear but some will make important contacts and have more time to spend on new projects that can lead to making additional positive contributions, and more money! The increasing jobs base and increasing revenues from new projects can combine with efficient eco-community living and the economic strategy of minimizing imports, to result in accelerated accumulation of individual and community wealth and equity. Unlike existing communities which operate on debt based systems, eco-communities operate on an ever increasing equity base with an "expanding economic advantage.

Working in or near Home - A personal choice shared by many

For me, living in eco-communities includes: walking to work from my breakfast room across a garden to my office; being near my kitchen during my work day; having fresh organic food to eat, clean water to drink and fresh air to breath; having office doors that open to a beautiful and quiet view of the natural environment or community park; having my community and home equipped with state-of-the-art telephone and video cable service connections to cyberspace (the Internet and the World Wide Web) and having the appropriate computer and telecommunication access hardware and software. Other economic advantages include: living within a short walk of organic food stores and farmers markets; stores selling basic home and office supplies; copy and mail services; ethnic restaurants and a great bookstore cafe! If I'm married, my wife's office can be just across the garden. If we have kids, their school, piano teacher and friends are all within walking, biking or trolley ride distance on safe, pleasant, pedestrian-oriented streets, and like living in Glade Spring, we will be able to enjoy the experience of our extended neighborly family.

For others who choose to work away from home, creating economic advantage may mean walking across a beautiful park to work, riding a bike or taking the trolley. If one's work is in another community, going to work could mean taking quiet, fast moving electric rail transit. This creates a wider range of movement for older people who can no longer drive, and for the handicapped and children who are unable to drive. When an automobile is needed for trips away from the community, all one will have to do is call up the community rental service and select from a wide range of vehicles, the one that best fits the need, and it will be clean and serviced every time it is used. Other benefits to eco-community living include access to a wider range of options in housing. Single parents who need day care can have it close at hand in safe, pleasant surroundings where parents and kids can get to know each other.

Cost Savings in Building and Operating Eco-communities

Because of design efficiencies and the reduced sizes of clustered eco-communities, I estimate they will cost at least 30% less to build than existing urban sprawl cities, and will cost 90% less to operate and be free of harmful pollution. The following facts support these predictions: Currently, about 40% of the cost of building urban sprawl development is transportation related. In contrast eco-community transportation infrastructure costs are estimated to be 10% of the total community infrastructure budget. If so, this represents a 30% savings by itself alone, compared to current urban sprawl infrastructure cost. Other cost reduction savings of up to 70% to 90% are based on the vastly smaller clustered community footprint. They involve: grading, storm drainage, water supply and waste water piping systems; natural gas piping; and electrical and telephone video cable line installation. Other savings involve the types of structures and green-technologies unique to clustering.

I define community operating cost as being composed of both public and private cost. City budgets pay only a small part of the ongoing cost of operating urban sprawl communities. The 1992-93 operating budget for the city of Los Angeles was just under $4 billion. This might seem like a high number until you look closer at what it actually cost to operate the auto centered metro area.

A study in 1992 by Runzhecimer International, a management consulting firm, shows that in the Los Angeles area the average private car currently costs $7,529 each year to own and operate. With 8 million total cars in the metropolitan area, that puts a "partial cost" of private transportation, in the LA area at over $60 billion each year! That's right, over $60 billion each year down the drain. When one adds in the annual cost of heating and cooling urban sprawl development the true cost of operating the LA area is over $100 billion each year, $100 billion just to "turn the key on" and keep it all running.

Within eco-communities, the yearly operational costs for transportation systems (including the acquisition, operations and maintenance cost of auto rental fleets, will be less than 10% of current urban sprawl transportation figures. This economic savings is based on an estimated reduction in auto usage of over 90%. Reductions in water will also be over 90%, based on less landscaping within the community and water catchement and reuse of water in city and agricultural areas. Reductions in heating and cooling cost will also be over 90% based on improved insulation and green-technology delivery systems.

Pressure to Change Existing Infrastructure will Increase

Worldwide, countries, cities, smaller communities, groups and individuals are scrambling for their chance and their place to participate in local and global life. Whatever provides economic advantage in the age of global access will be quickly utilized. While it is true that American communication systems and other types of American infrastructure are more advanced than most, in comparison to what is possible they lag far behind. As presented above, what is possible is the building of ecologically sustainable communities which are profitable and through the increasing community capital, support the building of other such eco-communities and as a group fund the restoration of the natural environment.

What is possible is what is coming, and what is coming, is coming very soon In his recent book Being Digital, Nicholas Negroponte, Director of the MIT Media Lab, tells the children's conundrum; "working for a penny a day for a month, doubling your salary each day." "If you started this wonderful pay scheme on New Years Day, you would be earning more than $10 million per day on the last day of January. This is the part most people remember. What we do not realize is that, using the same scheme, we would earn only about $1.3 million a day if January were three days shorter (like February). Put another way, your cumulative income for that whole month of February would be roughly $2.6 million, instead of the $21 million you earned in total during January. When an effect is exponential, those last three days mean a lot!" Negroponte says "We are approaching those last three days in the spread of computing and digital telecommunications" (digital - the movement of bits of patterned light). The implications of this are staggering.

This conundrum used by Negroponte is included to underscore how startlingly fast, now, I feel planned eco-communities will emerge worldwide, and how the gap in the quality of life will widen between those living in such eco-communities and those who continue to live in auto centered sprawl. This will put great pressure on existing cities to improve their infrastructure to accommodate the eco-community lifestyle. As this paper is written, to my knowledge, there are no complete planned eco-communities existing. Even as the first one is being built few people will notice. "The day after they open they will be the only game in town." At lighting speed other similar communities will emerge worldwide because people who live and work in them will have such a powerful economic advantage as well as and an improved quality of life.

For those countries, cities, smaller communities, groups and individuals who feel confident in their current ways of life, I suggest they notice what is happening to those who have decided to fully embrace and maximize their opportunity in the emerging age of access. The pattern to date favors those who maximize the opportunity of access and it reveals a widening gap in the quality of life almost to the extent of creating two realities.

And this is only the beginning.

Eco-communities as Living Universities

In many ways, living within one of the first eco-communities will be like living on a university campus. Similarly on a global level eco-communities may be seen as a network of planetary living universities. Individuals who live within and near these learning centers will experience markedly higher qualities of life.

Residents will be able to travel freely between them in real time and through cyberspace in virtual time. Advancements in computers and their through global telecommunication connection systems are essential components in creating the network of universities for a sustainable future. Unlike times past the difference in the quality of life will not show up by country or region. In the early stages of eco-community living the difference will show up much more locally, where a single eco-community or small group of such communities are built, the citizens of these first planned communities will live abundant, interesting and varied lives - in great contrast to auto cities.

Also, because of the increased opportunities for business offered by eco-community living and because of their efficient infrastructure operating systems, large amounts of capital will be accumulated or released for other uses. This capital can be used to fund the start up of new planned eco-communities and protect, preserve and restore the natural environment worldwide. On Earth Day 1991, Ian McHarg?, author of "Design with Nature," said, "The fine art of the 21st Century will be that of restoration of the natural environment." "We need, not only a better view of man and nature, but a working method by which the least of us can ensure that the product of his works is not more despoliation."

The Economic Advantage of Austria and Europe

Taking down what has already been built is much harder than starting anew. This gives Austria, and Europe as a whole, an economic advantage over the U.S., in that the urban sprawl pattern in Europe, while building momentum is just starting. If within Europe, deliberate eco-design strategies are set into motion now, it will cost far less to make the jump to sustainable living than in the U.S. where sprawl infrastructure must first be taken down. It is clear that Austria and Europe would like to preserve their historic cities, and protect their villages and countryside. At the same time, they are under great pressure to expand their economies and their housing and services.

This growth pressure can be put to advantage and utilized to go straight to the renovation of existing cities and development of new stand alone eco-communities. By making this decision Austria and all of Europe can avoid the U.S. auto-centered urban sprawl growth ring model of U.S. city expansion. They can protect city and village identity and preserve their country-sides by creating new satellite suburban and rural eco-communities. If done properly these new satellite eco-communities will pay for the acquisition and permanent protection of large areas of farmland and open space areas. They will also pay for rail system connections. If Austria were to build some of the first eco-communities, it would set the pace throughout Europe and create models Eastern Europe and the rest of the world can follow.

Ecological Planning Principles for Sustainable Living

The ecological planning principles for sustainable living listed below were created by a group of 22 ecological consultants for the Citizen planners Project of Ventura County, CA. The Project was founded in 1990 for the purpose of enabling citizens to discover and actualize a common vision of life in their County. It had seven phases:

Seven Phases of the Citizen Planners Project

  1. Citizens groups via citizen planners to establish and approve a set of ecological planning principles for sustainable living for their County.
  2. Involve community leaders via citizen planners to organize within each area of the county to work to refine the principles.
  3. Community leaders than to involve citizens-at-large in the process through similar meetings in each local area.
  4. Establish a comprehensive picture (Master Plan) of natural and man made county-wide features and conditions within each local area.
  5. Local citizens, via Citizen Planners, to create detailed concept plans for each area of local areas of the county.
  6. Present plans and ideas in the above phases for approval to gov. officials.
  7. Involve citizens in new policy and plans realized and refined on ongoing basis.
The Ecological Planning Principles for Sustainable Living

  1. Protect, Preserve and Restore the Natural Environment
  2. Establish True-Cost Pricing as the Basis of Economic Viability
  3. Support Local Agriculture and Local Business, Products and Services
  4. Develop Clustered, Mixed-Use, Walkable Eco-cities and Eco-communities
  5. Utilize Advanced Transportation, Communication and Production Systems
  6. Maximize Conservation and Develop Local Renewable Resource Systems
  7. Establish Recycling Programs and Recycled Materials Industries
  8. Support Broad-Based Education for Participatory Governance
Five Examples of Planned Eco-community Projects The ecological planning principles steer us away from sprawl, toward, pedestrian friendly clustering, a change of direction that supports preservation and restoration of the natural environment. These changes also support rail transit and mixed-use, pedestrian-oriented eco-communities. The five examples of planned eco-community projects that follow demonstrate both urban renewal and new community concepts. The first two demonstrate retrofit strategies for existing cities. The last three show design strategies for new suburban and rural eco-communities which by themselves; pay for and protect, preserve, and restore large areas of farmland and open space.

  1. Anaheim Mall Project: A large urban village master plan
  2. LA. Five Acre City Block: A small, center city urban block plan
  3. St. Vincent's Project: A suburban eco-community master plan
  4. Transformation of the Los Angeles Metro Area into eco-communities
  5. Rural Eco-Community: An Agrarian based, Eco-community Master Plan
1. The Anaheim Mall Project: A large urban village master plan

The Anaheim Mall Project is a proposed Urban Village on 72 acres located in Anaheim, California. By Urban Village, we mean a place where inhabitants can live within walking distance of work, schools, shopping, services, entertainment, recreation and cultural facilities, while having easy access to mass transit for travel to other areas and communities. At present the site is occupied by an old shopping mall with a high vacancy rate. The proposal is to take down the mall and build, in its place, a 16-acre central park surrounded by three and four story buildings for the above uses. A specific example of the economic savings coming from the Urban Village is the cost of the parking structures.

Currently, according to code, the City of Anaheim would require 11,000 parking spaces to serve the Urban Village project. Because of the mixed-use aspects of the project and the rail transit orientation, we propose the parking be cut in half, saving some 5,500 spaces. If parking structure spaces cost $10,000 per space, 5,500 spaces will save $55 million. Instead of building concrete parking structures - a part of the permanent problem - a better investment is to contribute that money toward building rail transit - a part of the permanent solution. Due to the mixed-use aspects of the project, faster absorption of various uses will allow the project to be built all at once.

2. The LA. Five Acre City Block: A small center city urban block plan

On a much smaller scale, another example of urban renewal clustering involves the renovation of an inner city neighborhood block. The first drawing shows the block in its present condition, and the second shows it transformed into a mixed-use, pedestrian-oriented neighborhood center. As you will note, in addition to extensive renovation of existing buildings, there is one new apartment building proposed for the block. Not only does this new building provide much-needed affordable housing, but it also provides the additional capital (from increased higher density land value) required to improve the land forming the community's central park, shown on the second drawing. The objective is to bring the property owners within the block together, creating a common goal. In other words, through cooperation and a pooling of resources of both land and capital, all of the property owners benefit economically, environmentally and socially.

3. St. Vincent's Project: A suburban eco-communities master plan

A suburban eco-community proposal involves a site located in Northern California, in Marin County just north of San Francisco between the 101 Freeway and San Pablo Bay. The bayside land is just north of the city of San Rafael and involves a marsh, an existing dairy farm and a private school. There is also an unused rail line running through the property that connects to the San Rafael Ferry to San Francisco.

The proposed community is sited on 139 acres, 8% of the total 1,700 acre site. The following financial analysis shows how much money is generated for the acquisition of open space, mass transit, site improvements and open space restoration programs. This partial savings is derived from less grading, road construction and fewer storm drainage systems, utility lines and final landscaping to be installed.

By utilizing true-cost pricing to evaluate a course of action, we take an important step toward long-term economic viability and sustainability without compromising the quality of life. In true-cost pricing, short term and long economic gains are based first in ensuring the health of natural systems and environments. Once we use this approach everything will change for the better.

5. Transformation of the Los Angeles Metro Area into eco-communities

Using the Anaheim Mall Project as an example, the Los Angeles Metro Area can be transformed from unsustainable auto-centered urban sprawl into totally sustainable eco-communities - one urban village at a time and pay for it all by the savings in pedestrian friendly, clustered development. The savings in parking structures, as noted above in the Anaheim Mall Project will totally pay for the transit line to the next urban village (every three miles on average) with no need of gov. funding.

4. Rural Eco-Community: An Agrarian based, Eco-community Master Plan

The image below shows clustered, pedestrian friendly, eco-communities surrounded by thousands of acres of highly productive community owned farm, forestry and natural lands and wildlife corridors. The farm and forestry lands will produce organic food, timber and renewable fuels, enough to supply the entire community and at the same time create a large surplus that will be sold as exports.

For hundreds of years China has been perfecting what they call food-forest-farming systems for the growing of food crops in protection of fast growing high quality timber. With the advent of the new renewable fuels technologies that utilize farm products and green waste for feedstock, the community will also reduce greenhouse gas emissions (CO2) and Global Warming.

Example of eco-community - Land Uses and Acreage Percentages

 4,000 acres (minimum lands per site) (sites range in size from 4,000 to 12,000 acres) 
 1,000 acres (25%) - micro-city/village footprint within surrounding agrarian land areas 
 2,000 acres (50%) - food-forest-farming (renewable oxygen, food, timber and fuel)
 1,000 acres (25%) – diverse parklands, wildlife corridors and open space

Example of eco-community - Land Value Increases after Gov. Approvals

 Rural Land Acquisition costs: (+/-$5,000 per acre x 4,000 acres) 	= -  $     20,000,000

Site Plan gov. approvals costs: (planning, legal & gov. fees) = - $ 1,000,000

Land Value after approvals: ($100,000 per acre x 1,000 acre city) = + $ 100,000,000

Total net worth of (1) new town site after government approvals = + $ 79,000,000

continue to PlanningAndPlanting or read this:

A friend of Joseph answering the question "What is wealth" (Jahn Ballard)

Where does wealth come from? Where will it come from in the future?

This question is one for which there are many answers, that usually do not provide people with a useful direction to focus on for their needs and desires. Wealth exists in the context of economy, and is generally experienced as visible signs of prosperity and high quality of life. The focus of this answer is going to be on the invisible dynamics that are behind the visible manifestations of what we call wealth. In order to get at these underlying patterns that cannot be seen in the physical world, I will start by with another question as a doorway.

What is one usable answer proposed to the question – Why exactly is the United States the global economic powerhouse it is, and has been for over two centuries? Try this on for size. Our continued global dominance comes from the fact that we have been able to sustain and grow the velocity of unfettered transactions for mutual benefit at the local level beyond anything ever seen before in history. This is reflected locally in what is called the multiplier effect, which simply says that every time a dollar is spent in a local human geography, after the first transaction, the next one doubles the economic wealth, and thereafter each transaction of that same dollar locally continues to create additional wealth. Once that dollar exits the local economy, its value contribution to local capital ends.

There could be said to be three aspects to the wealth of a society, the foundation of which is the degree that it stewards the natural resources with which it has been endowed by life. There is the wealth of individuals, businesses and organizations, and the social capital. The fundamental underpinning of the social capital is the trust that has built up over time that allows the individual and organizational wealth to be contained in a whole cultural web. That web is an ecology of relationships that is maintained by a few groups and individuals on behalf of their whole local society. The more cohesive that web of relationships, the more resilient and thriving that economy will tend to be. In addition to the money that gets exchanged, the communities with the greatest social capital are the ones that figure how to optimize non-cash, as well as cash transactions. The ability of a community to exchange value without every transaction requiring cash is the single greatest asset in building and leveraging its social capital.

The wealth of businesses is fundamentally built by two things. One is that it follows through completely on all the contractual agreements into which it enters. That builds its reputation for service and reliability, which guarantees its valued position with both its customers and vendors. The most wealthy businesses are the ones which figure a way to always leave its customers and vendors feeling that they got more than they paid for. This secret is of huge leverage, and gets delivered primarily because of the quality of energy present in the transactions, and not because of cutting corners to provide a ‘better deal’, or being the cheapest.

The second piece is that the business is managed in such a way that it retains earnings, manages its cashflows to track consistently with profit, and thereby builds its internal capital and equity consistently. It is crucial that it do all three of these things well when times are good, so that it has a rock-solid foundation for those times when things are not going so well. While the first piece of its wealth building is entirely within its control, the second is not due to the fact that financial information that is compliant with US GAAP (generally accepted accounting practices) is not designed to enable the data to be uses in optimizing the three ‘bottom lines’ described above. There is one book, Managing by the Numbers, which if followed, transforms that situation, and makes financial data usable on its face for optimizing wealth creation in a business.

The wealth of individuals is inextricably tied to that of businesses and the community, and hinges fundamentally on two things.

The first involves finding a way to express his or her natural talent, or personal genius, in such a way that value is shared that can be remunerated. This ability to find, develop and apply one’s unique gifts through vocation is the most crucial thing for a person to achieve, if they are to accumulate personal wealth. That is also the foundation of both deep personal satisfaction in life, and the ability to come from a place of consistent joy that provides that experience of getting more than expected through the uplifting presence of another in a transaction of mutual benefit.

The second piece for individuals is the same as for businesses – only entering into agreements that you are committed to and able to perform on, and keeping a continued focus on retaining and building reserves of material and goodwill for the times when things are challenging. These reserves may only be in the form of goodwill generated when others observe steadfast, competent and effective action backed by strong ethics.

These two go together in the great American tradition of taking calculated risks to fulfill a vision of value creation and delivery of great results that does not yet exist. This entrepreneurial spirit is what sets the US Economy apart from every other one on earth, although there are a few others starting to really get it too. The main thing that we Americans can fail to notice is that after two centuries of consistent progress toward democratizing opportunity, we are far and away ahead of any other society in making real the promise that anyone can become anything they choose to be if they will do what it takes to succeed.

That ‘what it takes’ cannot however be taken lightly, or we will tend to find a ‘them’ to blame for our failure to built a solid foundation and stay the course over what can sometimes be decades to achieve our personal vision.

Any way you slice it, the level of productivity and generosity in the United States, for all its shortcomings, is still a strong engine that helps significantly to drive the planetary economy to greater creativity and wealth creation. We are now more than ever in the position that we must take all this groundwork to the next level of synergy, co-creative flow and transformation of the fact that along with our productivity, we are also the most wasteful society on earth ( do you know what the product/non-product ratio is for the US economy?). Having had the freedom and leverage to do what we have done in the past, now we need to take responsibility for the social and environment capital that wastefulness is rapidly draining away.

We have made it this far. There is no reason we cannot learn to work together to create not just greater efficiency for the individuals and businesses, but also greater effectiveness for the social capital we have used for that success. We must all now also make the regeneration on the social and environmental fabric part and parcel of our success, or we will see an end to steady improvement of quality of life we have enjoyed so far.

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