National Center for Economic Gardening

Economic Gardening book: https://lnkd.in/efsgpta Check out Part II: page 83

We are in our second decade of media stories about the disappearing middle class. According to the pundits, academic authors and economists we have become a nation of rich and poor people, but not much in between. National leaders have stated that the inequitable distribution of wealth is the defining issue of our time. The Pope attacks the “mega-salaries for the rich and the crumbs for the poor.” Capitalism is once again under attack as a system that exploits the many poor for the benefit of the rich few. There is a fairly common understanding that the concentration of wealth combined with large scale grinding poverty is an historical recipe for change. In other episodes of American history where capitalism seemed to be working only for the owners, American workers sniffed around socialism, Marxism, communism and even anarchy as possibilities for getting a fair shake.  Thus, the great question in free societies is how to get the benefits of innovation and efficiency from free enterprise without jaundicing the environment it needs to thrive. Short of income redistribution, none seem to have a conceptually sound pathway for ensuring a middle class.  It could be because the question is phrased wrong. Rather than the “either/or” question posed in political debates, maybe it is a Tai Jitu question: “how do opposites exist in harmony?”  Is there a tension setting that allows robust Capitalism but still distributes wealth widely throughout society? The answer is yes, and it lies on the innovation side of this naturally emergent system. If commoditization is the root of poverty, then innovation is the root of wealth. To wit: If a company innovates something that no competitor can match, then profit margins rise. In effect, it is a short-term monopoly during which the company is awash in wealth. Historically during this phase, the money has been liberally distributed throughout the organization. Thus, we can conceptually argue that the maintenance of a middle class depends on innovation’s new wealth which flows to everyone before commodity pressure squeezes that wealth out of employees and into the hands of owners. If there is a pipeline of innovation, commodity pressures are kept at bay.

3,600 communities lost population between 2010 and 2020. That's why we do economic development.

If you are lost and trying to get out of the forest, running fast is not the most important thing. Facing the right direction is the most important thing. Recruiting commodity companies is running faster in the wrong direction.

These are the key elements of Economic Gardening. Programs that don’t incorporate these essentials are not (upper case) Economic Gardening®.  They are lower case economic gardening. *Focus on stage 2 growth companies *Focus on selling innovation outside of the community *Identifying commodity traps *Identifying root problems using five frameworks *Identification of ripe markets *Identification of a universe list of targeted customers *Use of web scrapers to find key words on targeted lists *Identification of the 2% who are actually in the market today *Use of listening posts to spot public signals of volatility (change) associated with the purchase process *Finding companies with open sales windows *Intercepting the investigation stage *SEO and social media improvements *Finding watering holes *Use of sophisticated tools: commercial database services, GIS mapping, search engine optimization, listening posts, artificial intelligence. 

In Economic Gardening, we use three marketing channels: outbound (lists), inbound (SEO on the website) and watering holes (virtual and physical gathering places). To create a marketing list, we develop the profile of the target customer, we refine that list using a tool that looks for certain words on their website, we then look for the 2% that are actually in the market (using listening posts looking for signals of change) and then intercept them while they are investigating alternatives.

Inflation is other people's increased wages baked into higher prices. Does everyone give up their wage increase to bring those prices back down? Economic Gardening's argument has always been that innovation increases wealth, not increases in commoditized wages (which are canceled by higher prices).

We now have a clean copy of the Capitalism’s Conundrum presentation that we made at Harvard Kennedy School this spring. This is the heart of Economic Gardening – what makes it so much more powerful. https://lnkd.in/gGtQhVQ6 (Go to: About EG/EG Principles and white papers)

"Consumer sentiment unexpectedly declined to the lowest level in eight months in early July, according to the University of Michigan survey. “Consumers remain vociferously frustrated at the persistence of high prices,” the director of the survey said." Bloomberg Those high prices were somebody's increase in wages. To bring prices down, a company has to reduce expenses. On the income/expense statement, there is that big number: wages. Commodity traps are like black holes: you can't get out of them. The solution is to innovate and make more money than CPI increases.

After last week, I’m not sure everyone knows what a tariff is. It is a tax by the federal government on foreign products. It is paid by American consumers to the American federal government. It’s purpose is to discourage buying foreign (read cheap) products by increasing the price.