Archive for February, 2012

Locavore: Rose petal dreams, parsnip reality

Tuesday, February 28th, 2012

Reposted from the Burlington Free Press

Crowd members in a University of Vermont conference room one recent Sunday afternoon started their final workshop at the Northeast Organic Farming Association of Vermont’s winter conference by sniffing sassafras root and chewing on juniper berries.

“This will get your senses going,” said Eva Sommaripa, the workshop co-presenter and legendary Massachusetts farmer who has a devoted following among Boston-area chefs.

Sommaripa and her farm are the focus of a recently published book by friend and fellow presenter Didi Emmons, a Boston chef, cooking teacher and award-winning cookbook author.

Wild Flavors: One Chef’s Transformative Year Cooking from Eva’s Farm” (Chelsea Green, 2011) shares Sommaripa’s quirky but thoroughly commonsense approach to food and eating — and life.

“Like a good relationship, there needs to be an intimacy with food,” Sommaripa says. “Shopping in most supermarkets is like consuming food blindfolded: We don’t know the history or life of these foods.”

The book is filled with the poetry of seasons spent on Eva’s Farm, but Emmons also offers practical advice and recipes for conjuring delicious food from unexpected places. “Wild Flavors” just landed a finalist spot in the Food Matters category of the highly regarded International Association of Culinary Professionals 2012 Food Writing Awards.

Workshop attendees heard from Emmons about how she first visited Sommaripa on her coastal farm and gradually learned to cook with ingredients including juniper berries (“the foodies’ chocolate chip”), chickweed (“stellaria, or star, our own version of Brad Pitt”) and spruce tips (“a lime and a nut wrapped into one”).

I want to love them all, but my own experience with wild foods has been mixed. I love crunchy, succulent purslane and the lemony bite of wood sorrel, but I remain unconvinced of the edible merits of some, such as the invasive known as Japanese knotweed, although Sommaripa uses it in a reportedly delectable Invasive Sorbet.

Beyond the wild, Sommaripa also raises a wide variety of herbs and vegetables, but even there she finds ways to love cultivated plants beyond when most people would cut them back or compost them: after they’ve bolted, gone to seed or grown old and tough.

She also eats parts of plants that others might not, including tulip petals (“strew them in a salad and consider them a brightly colored lettuce leaf”) and rose petals, which Emmons bakes into a tea-party-perfect pound cake that she had brought for workshop attendees to sample.

Since I do not have bags of beachside wild rose petals in my freezer as Emmons and Sommaripa do, I had to settle on making another cake from the cookbook with parsnips, an ingredient that does exist in wild abundance in Vermont farm storage bins in February.

Emmons explains in the book that she came up with the recipe the “year Eva grew parsnips the size of small children.” It’s a great use for parsnips of all sizes, with a result very similar to carrot cake, which you easily could turn it into if you’re parsnip-averse.

But I urge you to give parsnips a try. The winter section of the book argues eloquently on their “rich, nutty, creamy, sweet” behalf. If you give that local, cellared parsnip another chance, I promise to do the same this spring for Japanese knotweed.

Parsnip Tea Cake
From “Wild Flavors” by Didi Emmons (Chelsea Green, 2011)


2 large eggs
Three-quarters cup extra-virgin olive oil (or try local sunflower oil)
One-half cup buttermilk or yogurt
1 3/4 cup sugar (I used a bit less and next time will sub in some maple syrup)
1 3/4 cups grated parsnip (about 3 medium, wash but no need to peel)
1 1/4 cups unbleached white flour
1 1/4 cups whole wheat flour
2 teaspoons baking powder
1 teaspoon baking soda
1/2 teaspoon salt
1 teaspoon ground cinnamon
1 teaspoon grated nutmeg (preferably freshly grated)
1 cup chopped walnuts


1. Preheat oven to 350 degrees. Oil or spray two 8-inch loaf pans. (I used 2 8-inch rounds instead.)

2. Whisk together eggs, oil, buttermilk, sugar and parsnip in a large bowl. In a separate bowl, whisk together white flour, whole wheat flour, baking powder, baking soda, salt, cinnamon and nutmeg. Using a large wooden spoon, mix dry ingredients into wet ingredients. Fold in walnuts, mixing until just combined. Do not overmix.

3. Pour cake batter into greased pans. Bake for about 45 minutes (35-40 for 8-inch round pans), or until a knife inserted in the center of the cake comes out clean. Cool for 10 minutes in pans, then remove and set on racks to cool completely.

Contact Melissa Pasanen at [email protected], and follow her on Twitter at

The Debate Over Raw Milk Continues at Harvard Law School

Monday, February 27th, 2012

This month, Harvard Law School hosted a debate on an issue near and dear to our hearts: raw milk.

David Gumpert, author of The Raw Milk Revolution was on the side of the debate endorsing raw milk, along with Sally Fallon Morrell of the Weston A. Price Foundation.

Facing off against them and emphasizing the dangers of unpasteurized milk were Fred Pritzker of PritzkerOlsen law firm and Dr. Heidi Kassenborg, Director of the Minnesota Department of Agriculture.

It’s no secret that we here at Chelsea Green come down on the side of the small farmer and the choosy consumer (in other words, “Three cheers for David, Sally, and raw milk producers everywhere!”). But what do you think?

Watch the video and decide for yourself! Then pop on over to our Facebook conversation about the issue and chip in your two cents.

Chelsea Green Authors Named Finalists for Three National Awards

Friday, February 24th, 2012

Chelsea Green is proud to announce that two of its authors have been named finalists for major book awards, while a third is a finalist for a readers’ choice award.

The news of these three authors comes on the heels of essayist Edward Hoagland being named the 2012 winner of the John Burroughs Medal, one of the nation’s most prestigious awards for environmental essay writing, for his book Sex and the River Styx. He will be awarded the medal at a ceremony in April.

This trio of authors addresses everything from the impact of the decades-old wars fought in Afghanistan, cooking seasonally for both flavor and health from homegrown and wild herbs and edibles, and gardening for resiliency and community.

The authors are:

Ed Girardet is one of five finalists to receive the 2012 Helen Bernstein Book Award for Excellence in Journalism for his memoir, Killing the Cranes. Girardet’s memoir reflects on his more than three decades of experience covering war-torn Afghanistan, and the impact this has had on Afghani people. Established in 1987, the Helen Bernstein Book Award for Excellence in Journalism is given annually to a journalist whose work has brought public attention to important issues and includes a $15,000 cash prize. The winner will be announced on June 5.

Didi Emmons is a finalist for this year’s International Association of Culinary Professionals (IACP) cookbook awards for her book Wild Flavors: One Chef’s Transformative Year Cooking from Eva’s Farm, which offers wide-ranging recipes that reflect the shifting seasonal harvest but also show us how wild edibles and cultivated herbs add flavor to our food and improve our health. IACP is considered the gold standard among cookbook awards, and has been presenting its awards for more than 25 years. Winners will be announced on April 2.

Carol Deppe has been selected as a finalist in the 2012 Readers’ Choice Awards for “Best New Gardening Book Since 2010” for her book The Resilient Gardener: Food Production and Self-Reliance in Uncertain Times. Deppe’s book demonstrates how resilient gardeners and their gardens can flourish even in challenging times and help their communities to survive and thrive through everything that comes their way — from tomorrow through the next thousand years — which is owned by the New York Times Company — is a consumer-focused website that offers expert advice and reviews on a wide variety of topics. Winners will be announced March 30 (voting runs from Feb. 22 to March 21).

Carol has also launched a new seed catalog, which editor Ben Watson wrote about here.

Chelsea Green Author Wins Prestigious Environmental Writing Award

Thursday, February 23rd, 2012

Chelsea Green is proud to announce that author Edward Hoagland will receive one of the nation’s most prestigious environmental writing awards — the John Burroughs Medal — for his 2011 book of essays, Sex and the River Styx.

Hoagland will receive the medal in April at a special ceremony of the John Burroughs Association, to be held at the American Museum of Natural History in New York City.

The John Burroughs Medal has been given annually since 1926 for books that combine scientific accuracy, firsthand fieldwork, and creative natural history writing. Past Burroughs medalists include Rachel Carson, Barry Lopez, Gary Nabhan, Julia Whitty, and Ted Levin, among others.

This is the second time a Chelsea Green author has won the prestigious Burroughs medal. In 1988, Lawrence Kilham won the award for his book On Watching Birds.

“Chelsea Green congratulates Edward Hoagland on this well-deserved award, and we’re proud to have worked with him on this collection of essays,” said Margo Baldwin, Chelsea Green’s president and publisher. “His book reflects a deep commitment to rekindling our human connection to the natural world; something we seem to have lost in today’s literature.”

Baldwin, and the book’s editor Joni Praded, will join Hoagland at the April ceremony.

John Updike called Hoagland, “The best essayist of my generation.” Edward Abby, Philip Roth, and Annie Dillard have all praised Hoagland’s writing and his insight into the natural world and our human place in it.

For more than 50 years, Hoagland has been one of America’s most celebrated observers of both human nature and the natural world. In Sex and the River Styx, readers follow Hoagland as he travels to Kampala, Uganda, Tibet and into his own personal memories as he ruminates about aging, love, and sex.

Slow Down, Eat Up! New and Best Selling Slow Food Titles on Sale!

Thursday, February 23rd, 2012

The philosophy of Slow Food is a simple one: where our food comes from and how it is grown matters. We need to capture what we have lost when we industrialized our food supply – fresh, unadulterated, minimally processed, and locally produced food. We can invigorate local economies and renew the soil (and eat great food in the process).

We’ve got a wonderful crop of books to help you dive in and take the next step toward transitioning to a more local, resilient, self-sufficient economy by buying food that is grown and sold locally, using small-scale or organic methods.

Food is at the heart of our struggle to save the planet. Whether you want to get your hands in the dirt; or looking to find the best local cheese, wine, food; find the best new recipe using local food or preserving those veggies, we have the book for you. Here at Chelsea Green we strive to produce books that will be a lasting resource. The titles below are foundation books that will be trusted references on your bookshelf for years to come.

Happy reading from the folks at Chelsea Green Publishing.

P.S. Don’t forget to check out our full list of books on sale here:

Slow Wine: A Year in the Life of Italy’s Vineyards and Wines


Slow Wine adopts a new approach to wine criticism and looks beyond what is in the glass. A wine cannot be judged by scores, symbols or other numerical evaluations, but needs to be assessed in a broader context. The guide centres round the agronomical efforts of cellars, describing vines planted, vineyards tended and the philosophy underpinning the work of winemakers.

Three sections describe the cellars in their entirety: Life, the stories of the leading players in the world of winemaking; Vines, profiles of vineyards according to their characteristics and the way they are managed; and Wines, straightforward descriptions backed up by comprehensive statistics.

“We are the only wine guide that visits each winery, so the information is first-hand,” said editor Giancarlo Gariglio of the 200-person staff it takes to put the guide together each year. “We visit the vineyard, the cellar, and taste with the producer.”

Cheese and Culture: A History of Cheese and its place in Western Civilization


Cheese and culture Book Cover Image
        Coming Soon!
Available for Pre-Order

A comprehensive look at the 9,000-year history of cheese, the ways in which it has shaped civilization, and what it can tell us about the future of food. Cheese and Culture endeavors to advance our appreciation of cheese origins by viewing human history through the eyes of a cheese scientist.

This tour through cheese history offers a useful lens through which to view our twenty-first century attitudes toward cheese that we have inherited from our past, and our attitudes about the food system more broadly.

By examining the role of the cheesemaker throughout world history and by understanding a few basic principles of cheese science and technology, we can see how different cheeses have been shaped by and tailored to their surrounding environment, as well as defined by their social and cultural context.

“In this painstakingly researched yet passion-laced book, Paul Kindstedt shows us how cheese, from its rudimentary beginnings to today’s manufacturing, is inextricably linked to culture and, no less, to our future. Cheese and Culture is essential reading for anyone who loves cheese and, equally, cares about the future of food itself.” —Laura Werlin, author, Laura Werlin’s Cheese Essentials

Wild Flavors: One Chef’s Transformative Year Cooking from Eva’s Farm


Curiosity sparked Emmons’s initial venture down the Massachusetts coast to meet the celebrated farmer Eva Sommaripa, whose 200-plus uncommon herbs, greens, and edible “weeds” supply many top Northeastern chefs.

Wild Flavors follows Didi through a year in Eva’s Garden and offers both the warmth of their shared tales as well as the exquisite foods Didi came to develop using only the freshest of ingredients and wild edibles. Alongside the unique seasonal offerings, Didi provides profiles and tips on 46 uncommon plants, and shares Eva’s wisdom about staying connected and maintaining a sane and healthy lifestyle in an increasingly hectic world.

Wild Flavors is a finalists for this year’s International Association of Culinary Professionals (IACP) cookbook awards in the Food Matters category! READ MORE…

“Didi Emmons, a local rock star of vegetarian cuisine, has written a lovely and unique cookbook, jam packed with yummy recipes for using everything a plant has to offer—the bulbs, stalks, leaves, flowers and fruits. This book fills an important niche in the cookbook world.” —Melissa Kogut, executive director, Chefs Collaborative

The Art of Fermentation: An In-Depth Exploration of Essential Concepts and Processes from Around the World


The Art of Fermentation Book Cover Image
     Coming Soon!
Available for Pre-Order

The most comprehensive guide to do-it-yourself home fermentation ever published. Sandor Katz presents the concepts and processes behind fermentation in ways that are simple enough to guide a reader through their first experience making sauerkraut or yogurt, and in-depth enough to provide greater understanding and insight for experienced practitioners. With two color illustrations and extended resources, this book provides essential wisdom for cooks, homesteaders, farmers, gleaners, foragers, and food lovers of any kind.

Make sure to take a look at the amazing Foreword by Michael Pollan. Read it here.

The Art of Fermentation is an extraordinary book, and an impressive work of passion and scholarship. It lays the foundation for fermenting all kinds of foods, and whoever reads it will be able to negotiate any recipe for ferments (and conquer any lingering nervousness about fermentation) with impunity. I am so impressed — and ready to begin! Thank you, Sandor Katz.”—Deborah Madison, author of Vegetarian Cooking for Everyone and Local Flavors

Wild Fermentation: The Flavor, Nutrition, and Craft of Live Culture Foods


Wild Fermentation Book Cover Image

Bread. Cheese. Wine. Beer. Coffee. Chocolate. Most people consume fermented foods and drinks every day. For thousands of years, humans have enjoyed the distinctive flavors and nutrition resulting from the transformative power of microscopic bacteria and fungi.

Wild Fermentation is the first cookbook to widely explore the culinary magic of fermentation. This book takes readers on a whirlwind trip through the wide world of fermentation, providing readers with basic and delicious recipes—some familiar, others exotic—that are easy to make at home.

“This immensely valuable book belongs in the kitchen of anyone interested in health, nutrition and wild cultures. It is a feast of fact, fun, and creativity by a modern wise wo-MAN.” —Susun Weed, author of Healing Wise

Libation, A Bitter Alchemy


Libation, A Bitter ALchemy Book Cover Image

The essays in Libation, a Bitter Alchemy, follow Deirdre Heekin as she unearths ruby-toned wines given up by the ghosts of long-gone wine makers from the red soil of Italy, her adoptive land; as she embarks on a complicated pilgrimage to the home of one of the world’s oldest cocktails, Sazerac, in Katrina-soaked New Orleans; as she attempts to craft a brandy from inherited roses, the results of an old Sicilian recipe she found in a dusty bookstore in Naples. Musing on spirits from Campari to alkermes, Heekin’s writing is as intoxicating, rich, and carefully crafted as the wines, liquors, and locales she loves.

“Deirdre Heekin sets a bountiful table for her readers. Libation is like the best of meals, in this case one with plates full of delicious memories and ruminations on passion and curiosity. And, finally and most importantly, there is a most satisfying dollop of love, a fine dessert which leaves us with an almost unimaginably sweet regard for life.” —Neal I. Rosenthal, author of Reflections of a Wine Merchant

The Slow Food Dictionary to Italian Regional Cooking


The handy and practical Slow Food Dictionary of Regional Italian Cooking by the editors at Slow Food International tells you everything you ever wanted to know about Italian regional cooking as prepared in homes, osterias and restaurants.

Packed with information about dishes and ingredients, tools and techniques, origins and trends, the book (which contains 40 color illustrations) is aimed primarily at food lovers but will also be of interest to anyone curious to find out more about Italy in general, its people, its language, its history and its culture.

Cheesemonger: A Life on the Wedge


Cheesemonger Book Cover Image

Witty and irreverent, informative and provocative, Cheesemonger: A Life on the Wedge is the highly readable story of Gordon Edgar’s unlikely career as a cheesemonger at San Francisco’s worker—owned Rainbow Grocery Cooperative. A former punk-rock political activist, Edgar bluffed his way into his cheese job knowing almost nothing, but quickly discovered a whole world of amazing artisan cheeses. There he developed a deep understanding and respect for what goes into making great cheese.

“Smart, compassionate, and fun to read, Cheesemonger took me by surprise! Who would expect the memoir of a cheese man to be so fascinating, playful, and refreshing? It’s great to hear a voice on food from the punk route, and Gordon Edgar brings a fresh and important perspective that we could all use for hand-made foods, those that aren’t, and the people who buy them.” —Deborah Madison, author of Local Flavors: Cooking and Eating from America’s Farmers’ Markets and What We Eat When We Eat Alone

Italian Cheese: A Guide to Its Discovery and Appreciation


Italian cheese Cover Image

Starting with illustrated descriptions of traditional and industrial cheesemaking, Slow Food’s authors take us through the processes of buying, tasting, and storing cheeses. Dictionaries of tasting terms and the language of cheeses and cheesemaking provide essential preludes for the heart of this book—descriptions of Italy’s farmhouse cheeses, traditionally made from cow’s, ewe’s, and goat’s milk.

Organized by region and accompanied by elegant color photographs, each description covers how the cheese is made and matured, along with historical and geographic nuggets.

Written by people in love with farmhouse cheeses, and with everything small, local, slow, and traditional foods and food systems represent, this is an informative and hopeful book, celebrating a rich, rural European tradition. This book will make you start packing your bags for a cheese lover’s tour of Italy.

Terra Madre: Forging a New Global Network of Sustainable Food Communities


Terra Madre Book Cover Image

More than twenty years ago, when Italian Carlo Petrini learned that McDonald’s wanted to erect its golden arches next to the Spanish Steps in Rome, he developed an impassioned response: he helped found the Slow Food movement. Now, it’s time to take the work of changing the way people grow, distribute, and consume food to a new level.

On a global scale, as Petrini tells us in Terra Madre, we aren’t eating food. Food is eating us.

Large-scale industrial agriculture has run rampant and penetrated every corner of the world. The price of food is fixed by the rules of the market, which have neither concern for quality nor respect for producers. People have been forced into standardized, unnatural diets, and aggressive, chemical-based agriculture. Food has been stripped of its meaning, reduced to a mere commodity, and its mass production is contributing to injustice all over the world.

In Terra Madre, Petrini shows us a solution in the thousands of newly formed local alliances between food producers and food consumers. And he proposes expanding these alliances—connecting regional food communities around the world to promote good, clean, and fair food.

Chelsea Green Author Launches Seed Company

Thursday, February 23rd, 2012

It’s late winter, and gardeners everywhere are thinking of seed catalogs and dreaming about getting their fingers back into the soil. Even here in northern New England we’re starting to get anxious, since it has been one of the warmest and least snowy winters on record.

So, just in time, Carol Deppe has sent us her first official list of varieties for sale from her new company, Fertile Valley Seeds, in Corvallis, Oregon. The on-line descriptions offer a brief but exciting glimpse into the kinds of vegetables that Carol has been working so diligently to improve over the years – developing crops that are climatically suited to the unique growing conditions and climate of Oregon, in addition to being incredibly nutritious and designed for homestead self-reliance.

Carol is a remarkable woman – a gardener, writer, seed saver, plant breeder, and Harvard PhD. Her two classic books, both published by Chelsea Green, are Breed Your Own Vegetable Varieties and the recently published The Resilient Gardener: Food Production and Self-Reliance in Uncertain Times. The latter was named one of’s Top Ten Gardening Titles of 2011, and recently was chosen as a finalist for the Readers Choice awards.

The select seed varieties Fertile Valley is offering this year include highly nutritious food plants that Carol has either bred herself or has selected and improved over the years. She describes her ‘Cascade’ series of colorful flint corns as “the ultimate survival crop,” perfect for homestead gardeners who want to produce their own corn meal. And several other intriguing strains – like the ‘Hannan’ popbean (think chickpea/garbanzo) and the legendary Oregon heirloom ‘Sweet Meat’ winter squash – are also available. All of the vegetables are open-pollinated (non-hybrid) varieties that are in the public domain – all characteristics that Carol and her friends, like plantsman and Seeds of Change co-founder Alan Kapuler (aka, “Mushroom”) prize about all else in this day and age, when multinational “life sciences” companies are trying to monopolize our food supply, all the way from seed to table.

If you’d like to receive a seed list from Fertile Valley Seeds, you can send an email request to [email protected]. Or visit Carol’s website ( and follow the link to her books on to read more about the life work of this truly unique and inspirational woman.

– Ben Watson, Senior Editor

How Can Business Leaders Accept the Challenges of the New Energy Era?

Wednesday, February 22nd, 2012

By Ned L. Harvey, reposted from Rocky Mountain Institute

I have one word for you — scalability.

If you’ve have heard about Reinventing Fire, Rocky Mountain Institute’s roadmap for a secure, renewable energy future, and are like almost everyone with whom I have talked about it, you wonder where to start. This blog is the first of several by RMI staff to help business leaders identify the steps they can take now to begin seizing the economic and competitive opportunities available by leading in the new energy era.

Since releasing Reinventing Fire back in October, I’ve been on the road introducing its vision. The majority of my time has been spent with senior business executives, most of whom recognize the risks associated with our aging energy systems but struggle with the magnitude of the challenge and a clear picture for what they can do about it.

A lot of execs are already taking the initial, common sense steps to move their businesses and industries toward a new energy economy. Many others, though, despite their concerns about the consequences of business as usual in our energy system, seem to want that same business as usual to make things better.

Thankfully, Reinventing Fire provides a robust framework to develop solutions that transcend the industrial boundaries and entrenched interests hard-coded into our energy systems over the past century. Our guide to a 2050 energy system that requires no oil, coal or nuclear power includes detailed recommendations for key players within the relevant sectors: transportation, buildings, industry, and electricity. These suggestions range from no-regrets actions everyone can take today to truly innovative actions steps for the most progressive leaders.

Yet, faced with such complex and interconnected issues, many readers are still asking: How do I gain traction personally and professionally? Are there other tangible steps to take now, and how can I influence those around me to join in this grand quest? And, maybe most difficult to answer, how do I know if I am making progress? When asked these questions, I have a few suggestions. They include: Focus on the economics of opportunity vs. the economics of cost. The math may be the same, but people and organizations seem willing to accept a lower potential ROI or assume more investment risk when pursuing an opportunity they are excited about vs. trying to justify a cost they would prefer to avoid. Establish a winner’s mindset as winners and losers are sorted out in the shift from fossil fuels to a more efficient, renewable energy base. Accomplish this by focusing your own and your business’s attention on the opportunities created by action. Keep in mind the risks associated with inaction and maintaining a business-as-usual attitude toward energy.

Own your role in contributing to the problem — and pursuing the solution. I recently had a transformational experience at an event hosted by the Pew Center on Global Climate Change. Up on stage, in front of several hundred people, the CFO of UPS opened his presentation with a simple statement: “We are polluters.” His point was clear and honest — that in the execution of its core business, UPS generates a lot of pollution. The CFO said he — and all of UPS management — own this as a real business challenge, and have made addressing their environmental impact a top-line priority.

I realized that at some point the energy at UPS must have shifted from denial and obfuscation of the obvious facts to acceptance, so all the energy wasted before that turning point could be redirected to solutions. I was left wondering how many coal-based utilities would openly and honestly acknowledge that they were polluters, and how much energy and resource might be unleashed if they just accepted that fact and owned the responsibility to deal with it.

Become present with the problem and challenges for all stakeholders, and look across boundaries to embrace “coopetition.” It’s one thing to understand a problem from your own perspective. It’s another thing to really experience it — to internalize the challenges that the problem causes and really commit yourself to being an active, vital part of the solution. Yet, you’ll also want to understand the perspective and roles that others will play in the transformation and work in concert with them to achieve progressive alignment across all the powers with a stake in the game.

A great example of this is playing out in the renewable energy space, especially in the solar industry. Ultimately, deep penetration of renewables will require broad acceptance by electric utilities. However, management and engineers within today’s utilities often see renewables as a major nuisance with technical and economic hurdles that are not worth overcoming compared with the alternates at hand. While most entrepreneurs and renewables advocates are spending their energy and precious resources lobbying for mandates to force utilities to use renewables, a few are starting to understand they might gain more by working with utility leadership to envision solar and other renewables as a problem-solving asset.

Avoid a too big a focus on quick wins or buzz about the latest and greatest technology. Instead, measure progress one step at a time and in terms of potential scalability. Solutions to messy problems including climate change, national security and economic competitiveness take a long time to develop and rarely take the shape or form expected at the outset, so it’s really hard to predict and measure progress.

That’s OK, and as such it’s essential to see and celebrate small wins and to recognize that in many ways the ultimate scalability of what we are doing today may contribute more than the specific ideas themselves.

For example, many of today’s very successful solar business models and products, which work really well under subsidies, are likely not terribly scalable since they are often unintentionally customized for success within an artificial market. Conversely, some of today’s more moderately successful solar business models and products are slowly proving themselves in unsubsidized and less solar-friendly markets, likely building on a core set of customer-oriented values, which will serve them well in when all the subsidies fade away.

As visionary business leaders have shown, we can all take immediate actions in this grand effort to transform the biggest and most complex system in modern society. Beyond the first steps, diligent application of tested approaches including systems thinking to look beyond narrow boundaries will, in time, create solutions to some of the most wicked problems of our time.

Ned Harvey is the Chief Operating Officer of the Rocky Mountain Institute. This piece was originally published at RMI.

Wild Flavors is an IACP Finalist!

Tuesday, February 21st, 2012

Congratulations are in order for Didi Emmons, author of Wild Flavors: One Chef’s Transformative Year Cooking from Eva’s Farm.

Last Thursday, Feburary 16th, finalists for this year’s International Association of Culinary Professionals (IACP) cookbook awards were announced, and Wild Flavors is a finalist in the Food Matters category!

Considered the gold standard among cookbook awards and widely lauded as the most selective in the industry, IACP has been presenting its cookbook awards for more than 25 years to promote quality and creativity in culinary writing and publishing, and to expand the public’s awareness of culinary literature. Winners will be announced on April 2.

What are readers saying about this fun and unique cookbook? Here’s a recent customer review:

“This is an incredible must-have book for anyone out there who likes to know where their food comes from and enjoys exploring new flavors in their kitchen. Recipes aside for a moment, the book itself is beautiful. The pictures pull you into the lush verdant world that is Eva’s Garden, and I have spent hours reading through the charming, funny, and poignant vignettes, stories, and lessons that give the reader a glimpse into the quirky but purposeful life of Eva Sommaripa. …If you are intimidated by fresh herbs (I was), this book will change your life — Emmons writes about each ingredient as she would an old friend, giving unfamiliar herbs like Chervil or African Basil context and personality that will help ease your anxieties. …This is my new favorite book and I would recommend it to anyone interested in food, farming, or the environment!” –BookWorm

Check it out for yourself, and stay tuned to hear about the IACP award! We’ll be waiting impatiently by the inbox to hear the results on April 2!

We Have a Love of Money, Why Not a Money of Love?

Monday, February 20th, 2012

Hazel Henderson, author of Ethical Markets: Growing the Green Economy, is mentioned in this interesting article on how love affects the economy. Like many feminist thinkers, Henderson points out the staggering amount of unpaid, un-valued work that is done by homemakers (men included).

What would our economic stats look like if we included this, and other work done out of love, instead of ignoring it?

From JustMeans, by Reynard Loki.

Love may be a hot commodity, but we don’t recognize its true economic value. We are the poorer for it

The average person celebrating Valentine’s Day will spend $126.03, the highest in the 10-year history of the Valentine’s Day Consumer Intentions and Actions survey, conducted by BIGinsight for the National Retail Federation (NRF). With an increase of 8.5 percent over last year, total spending on our “better halves” is expected to hit $17.6 billion.[1] That’s more spending in a single day than the GDP of nearly 100 nations, including Afghanistan, Uganda and Zambia.[2]

“As one of the biggest gift-giving holidays of the year, it’s encouraging that consumers are still exhibiting the desire to spend on discretionary gift items, a strong indication our economy continues to move in the right direction,” said NRF President and CEO Matthew Shay. “Anticipating high foot traffic in the coming weeks, retailers have replenished their inventories and will entice eager shoppers with great deals on everything from special menu items at restaurants to clothing to flowers and, of course, chocolates.”[3]


But while the commodity of love has been crystallized in the West on a single day of the year, love’s true intrinsic value to society is not part of the economic system. In our fundamentally market-based economy, value is placed on goods and services. But love — in the form of caring and emotional support — is not part of this equation, though ultimately, it is the glue of society. From dyadic partnerships to family groups, from neighborly love to community bonding, from a love of country and ultimately a love of all mankind and nature, this emotion — and all the ways it is manifested — is critical to keeping society intact. Yet somehow it remains outside our economic life, only to pop up in dramatic fashion in the world of retail — primarily on Valentine’s Day, but also on Mother’s Day, Father’s Day, birthdays and funerals.

From credit derivatives to reinsurance, from carbon credits to soybean futures, Wall Street has figured out how to place an economic value on just about everything, including many “things” that aren’t things at all, but purely ideas, like loan defaults. But love, which actually provides a real service to humanity (even, arguably, in its most licentious forms), is left outside the purview of financial markets.


While parents in some countries may benefit from tax credits, society has placed no actual investable value on unpaid household work. We are quick to say that values begin at home, yet we place no financial worth on the work-hours expended to instill those values. As any dedicated parent knows, raising children, preparing them for a productive life in society, teaching them how to be good citizens, all the while being an emotionally supportive husband or wife is exceedingly hard work — and society as a whole is clearly better for it. Shouldn’t there be a way to place an economic value on all that blood, sweat and tears?

In his 1977 book The Household Economy, Scott Burns observed that “the hours of work done outside the money economy rival those done inside and will soon surpass them.”[4] “We give absolutely no economic recognition to the importance of the one single institution responsible for the day-to-day care and maintenance of human beings. The household — the family — is an institution that tends our hearts, minds and bodies. No other institution has such clear or complete charge or such enormous responsibility. At best, every program of social care and welfare is compensation for deficiencies in some households, and there is no institution, public or private, that could be expected to assume even a small portion of the responsibility that belongs to the household.”[5]


Perhaps love has no place within the “money economy.” The late Canadian economic philosopher Samuel Edward Konkin III, author of the New Libertarian Manifesto, proposed the development of a “counter-economics” in which peaceful and decidedly transparent transactions would occur in the “agora,” the Greek term for open space that typically meant a public market. His term “agorism” encapsulated the concept of a black or grey market that was outside the regulatory and taxable reach of the corporatocratic state. In such a counter-economy, which might feature local exchange trading systems (LETS) and barter economies, love would be more likely to carry its true weight as a financial commodity as the agora is community-, not state-, focused. Localized production and trade encourages social contact — and that means nurturing the love quotient.

Economist Hazel Henderson, a former Regent’s Lecturer at the University of California at Santa Barbara who also held the Horace Albright Chair in Conservation at the University of California at Berkeley, says all this missing value is part of the unpaid “love economy,” what she describes as “all the caring, sharing, parenting, volunteering, bartering, reciprocity and mutual aid that buttresses the official GNP-measured sectors of all societies.”[6]

In her most recent book Ethical Markets: Growing the Green Economy, she writes, “While economists still count homemakers and stay-at-home moms and dads as ‘unemployed and not economically active,’ the 1995 United Nations Human Development Report found that this and all other unpaid work amounts to $16 trillion missing from the official global GDP figure of $24 trillion. Represented women’s unpaid work was $11 trillion and $5 trillion for that of men. Even today, global economic statistics still exclude two-thirds of the world’s output.”[7]


The actual work carried out by the care industry (i.e., daycare, eldercare, home helpers, counseling services, etc.) was once primarily the dominion of unpaid women caring for their families. Today, these are multibillion-dollar industries. In 1997, long-term elderly care annual expenditures in the United States was $115 billion. According to the Kaiser Commission on Medicaid and the Uninsured, that number is projected to triple by 2040, reaching $346 billion.[8]

“Millions of women who used to provide these services free in the home have already moved into the job market to obtain recognition and income,” writes Henderson in her 1998 essay “Toward Holistic Human Relationships.” “Thus, the monetarizing of formerly unpaid caring work will continue to be the fastest growing services sector, even though…this adds no ‘productivity’ to the economy, but rather recognizes formerly unaccounted productivity which subsidized the official money-denominated, GNP-measured sector.”[9]


Whether or not society will ever be able to put a proper value on love, it’s clear that the way we have commodified love isn’t sustainable. The vast majority of the chocolates that will be purchased for Valentine’s Day, for example, are not fair-trade: a mere 0.1 percent of all chocolate has such certification.[10]

Cut flowers are particularly bad for the environment due to their massive carbon footprint. The majority of them are grown in the Netherlands, Colombia, Ecuador, Ethopia, Kenya and India, and then flown in refrigerated airplanes, driven in refrigerated trucks and stored in refrigerators at your local florist, all waiting to wilt. According to a 2008 report by Food & Water Watch and the Council of Canadians, the rise of Kenya’s floriculture industry has resulted in “a number of serious ecological problems for Kenya’s rivers and for [Lake Naivasha], including loss of water, an unsustainable increase in the population because of the laborers they have attracted, and the overuse of pesticides and fertilizers.”[11]


Every rose has its thorn, and in some cases, it can kill. “[T]he flower industry is so important to the Kenyan economy that in the face of such instability the army and police put most of their resources into guarding flower shipments instead of local people — so that the Valentine’s Day delivery could reach European buyers in time,” writes Pat Thomas on “Since 2007, your Kenyan roses have come at a cost of more than 100 deaths and the displacement of more than 300,000 people.”[12]

And of course, who can forget that unsustainable Valentine’s Day mainstay — diamonds, or more accurately, “blood diamonds” and other conflict minerals that have financed wars in Africa for decades. Rebels in Sierra Leone and Liberia financed the Sierra Leone Civil War by trading diamonds for arms. Between 1992 and 2002, around 50,000 people were killed.

“Love is not some complex, mystical abstraction,” argued the late Leo Buscaglia (a.k.a. “Dr. Love”), a professor of Special Education at the University of Southern California and the author of several best-selling books on the subject. “It is something accessible and human that we learn through our everyday experience.” Buscaglia, known for being a powerful motivational speaker, may have been sugar-coating reality a bit in order to prime the love-in pump. Because as long as something so fundamentally human remains outside the economy — and the way we have commodified it remains unsustainable, childish and in some cases, deadly — it’s clear that it will take a lot more than everyday experience to teach us the true value of love.

Reposted from JustMeans.

5 Ways to Make Your Dollars Make Sense – By Michael Shuman

Friday, February 17th, 2012

This excerpt originally appeared on Yes! Magazine’s website.

Concerned about Wall Street’s devastating impact on communities? Then invest in yourself—the most local investment of all.

Americans’ long-term savings in stocks, bonds, pension, life insurance, and mutual funds total about $30 trillion. But not even 1 percent of these savings touches local small businesses, the source of half the economy’s jobs and output. Is it possible to beat Wall Street’s 5 percent long-term performance by investing in your community? The answer is a resounding yes!

Co-op members who lent to the Weaver Street Market in North Carolina and to the Seward Co-op in Minneapolis earned well over 5 percent per year. Many outside investors who bought preferred shares of the Coulee Region Organic Producers Pool, a co-op of organic farmers, are still receiving an annual dividend of 6 percent. Equal Exchange has paid a dividend to its preferred shareholders averaging above 5 percent for 22 years. Investors who participate in New Markets Tax Credits automatically get a tax credit equal to 5 percent of their capital for each of the first three years and 6 percent for the next four—even if the investment generates no real return whatsoever. Burt Chojnowski’s returns have been good enough to convince outside investors to put more than $300 million into his local companies and projects over 25 years in Fairfield, Iowa. Most of LION’s deals in Port Townsend, Washington, are paying between 5 and 8 percent returns per year. Microlenders on are averaging an annual return of 10.4 percent. Jeff Haugland has paid the local shareholders of Community Grocers in Mount Ayr, Iowa, an annual dividend of 5.25 percent.

All of these profitable initiatives proceeded within existing securities laws. If, however, national or state governments were to implement sensible, simple, zero-cost reforms, the number, variety, and promise of local-investment opportunities could expand dramatically. The many examples in this book— and the thousands of others out there, some of which may be happening in your community right now—suggest that the universe of local investment is expanding faster than financial astronomers like myself can possibly keep track of it.

Not every local company, of course, will beat the 5 percent rate of return from existing markets. Betting on any one or two businesses, just like betting on any one or two NASDAQ stocks, is very risky. No one should read this book as suggesting that we each should pull all our money out of the stock market and put it all into our neighborhood diners or bookstores.

As models for local investment proliferate, the focus will shift to the quality of each investment and the quality of your local-investment portfolio. The country is about to travel up a steep learning curve to discern the best local businesses from the fraudsters and grifters, and how to build a local-economy infrastructure in our communities—replete with local purchasing, entrepreneurship programs, local business alliances, and public policy reforms—that will increase the probability of local businesses succeeding and local investments paying off. One modest step might be to move 5 percent of your money from Wall Street to Main Street each year. By the time you get to 100 percent in twenty years, the nation should have a thriving network of regional stock exchanges and local mutual funds.

But another vexing question about local investment I puzzle over is this: Does it make sense to invest in anyone else’s business, bank, project, or fund until I have thoroughly invested in . . . myself? Might I get a better than 5 percent annual rate of return investing in my own bank account, my home, my own energy-efficiency measures, and my education? Most of us ultimately have a significant portion of our wealth in these intimately close items. Getting these investments right might be the single best way to invest locally.

To beat Wall Street, investments in yourself must achieve not a 5 percent annual rate of return but a 7 percent rate. That’s because most of the options could not qualify for tax-deferred IRA or 401(k) investments, and the extra 2 percent … approximates the lifetime benefit of tax deferral.

Remarkably, though, the 7 percent goal is achievable—and in so many ways that many Americans, perhaps most, might never need to think about retirement accounts again.

1. Become Your Own Banker

There is one absolutely guaranteed place where you can get a rate of return well over 7 percent —in fact, often over 15 percent or 20 percent. Pay off the damn credit cards and stay out of debt! As the Sage of Omaha, Warren Buffett, says, “Nobody ever goes broke that doesn’t owe money.” Besides being expensive and self-destructive, credit card debt winds up sucking money out of your community and into the hands of distant banks, back offices, and collection agencies.

Here are some sobering facts about Americans’ relationship with credit cards. In 1990, the average American household had about $3,000 in credit card debt. It has since more than quintupled to $15,300. By the end of 2010, total credit card debt was expected to exceed $1.1 trillion. According to a recent survey by Consumer Reports, a third of Americans don’t have credit cards at all, but most of these folks are poor and therefore vulnerable to even worse depredations from payday lenders and loan sharks. About half the population pays its cards off every month. The rest of us have a problem—albeit one that can easily be fixed in a way consistent with the goals of a local living economy.

Another consideration underscoring the value of keeping a modest reserve of cash is that we are entering turbulent times. In the last few years, both the stock market and the housing market have tanked and many serious analysts fear that both could crash again, perhaps even more catastrophically. Some predict a perilous period of deflation ahead, where falling prices convince consumers to delay spending and trigger deep recessions. Others fear inflation, given the enormous size of the U.S. deficit and rising oil prices. In either case risk-averse lenders might cut off loans or credit cards, raise rates, or both. Since Sam doesn’t like to gamble, he will create a hedge against uncertainty so he can control in his own federally insured bank account.

This proposal is hardly original. Listeners to AM talk shows may have heard about a similar scheme, called “Bank on Yourself,” which encourages you to invest in a specialty life insurance policy that also can serve as your low-risk bank. Frankly, since your savings have to live somewhere, whether it’s under your mattress, in a money market account, or embedded in a gold stockpile, these options are all worth considering. But given the importance of keeping your money close to home and supporting local businesses, you should probably put your cushion in a locally owned bank or credit union, not a distant insurance company.

The bottom line is this: If you create a slightly larger cushion than you think you’ll need, you’ll never need to worry about credit cards or consumer loans again. What wouldn’t millions of Americans (including me!) do to redo their early years with this kind of approach. At some point, you then could move into the next level of investing. That would not be going into the global stock market. It would be buying your own home.

2. Become Your Own Landlord

Investing in your own home strengthens your community. While the evidence has been debated in recent years, the degree of home ownership in a neighborhood does seem to correlate with many other quality-of-life indicators, such as educational achievement, low crime, civic participation, public health, and property values. This led recent presidents as diverse as Bill Clinton and George W. Bush to push for “an ownership revolution” in the housing market. And if you are diligent about getting your mortgage through a local bank or credit union, where you’ll find the most competitive rates anyway, you can rest assured that your interest payments will be recycled through your community through additional local loans.

A home purchase really delivers two different kinds of valuable rewards. One is that you’ve got a place to live. Hey, you have to live somewhere! Instead of paying a landlord every month, you effectively become your own landlord. Yes, you enter a debt with your mortgage (hopefully, again, with your local bank), but as you pay it down, you grow an asset that ultimately eliminates rent payments for the rest of your life. The second reward is that you now have an asset that you can draw upon for your retirement. At some point, if you need the cash, you can sell your home and move into a smaller one. Or you can enter a “reverse mortgage” with a local bank that pays you an income stream and gradually works you out of ownership. The reality is that most Americans use their homes as their piggy banks for retirement anyway.

Once you’ve saved enough for a down payment, investing in your local home is unquestionably a smarter investment than investing in the nonlocal stock market. Working in your favor is the quirky federal tax code, which allows you to claim a tax deduction for interest on your mortgage. If your federal tax rate is 21 percent, then every dollar of interest you pay can be discounted by 21 percent. This especially helps you in the early years of a mortgage, when nearly all your payments are interest. In other words, your rent is effectively 21 percent lower per year, in addition to the benefits of growing an asset.

Home investment gives a local investor one huge, indisputable advantage. As the custodian of your home and as a participating member of your community, you actually have the ability to increase the probability of your investments succeeding. You can improve your house through repairs, additions, and tender loving care. You can help create a fabulous neighborhood spirit. You can contribute to the success of your public schools. And once you own your home, free and clear, no knuckleheaded politician or CEO can take it away from you. Being an active investor, holding a real deed to real property, means you’re less vulnerable to the next generation of Bernie Madoff–like fraudsters. In contrast, when you place your retirement money on Wall Street, you can only watch and pray.

3. Become Your Own Utility

The typical U.S. household is spending about $3,500 per year on electricity, fuels, and water. If you’re trying to get a 7 percent return on investment or better, you could spend $1,000 on dozens of kinds of efficiency measures that would save you more than $70 on your energy bill each year. You could use your $1,000 to buy a new high-efficiency refrigerator, oven, or washer and dryer—plus you get the bonus of a brand-new appliance. Indeed, you probably can do much better than a 7 percent return. According the U.S. Environmental Protection Agency, customers participating in many utility- or state-sponsored efficiency programs are saving 10 to 20 percent of their energy bills. If Americans took full advantage of the more efficient appliances and took steps to improve the efficiency of their homes and buildings, they could cost-effectively save 10 to 30 percent on their energy bills per year.

According to energy-efficiency expert Greg Pahl, “Home energy efficiency retrofits are probably the best returns on investment you’re going to get, as opposed to putting a windmill in your backyard. The home energy efficiency retrofits can pay for themselves, depending on where you happen to live and what the credits/incentives may be, in just a couple of years. Dramatic savings are realized very quickly. The money that you will be saving on your energy costs from these retrofits will make any further renewable energy system installations much more effective, and much more cost-effective.”

Of course, not every $1,000 investment in energy-efficiency equipment will make your house $1,000 more valuable upon resale—you may not be able to preserve all the principal invested. Some investments, like those in greater insulation, will increase your home value, while others, like appliances with a limited lifetime, won’t. Economists sometimes call the latter a “wasting asset,” which means it loses value over time, perhaps even immediately.

The entire discourse about energy-expenditure savings is oddly disconnected from that of long-term investment for retirement. Household efficiency measures are spoken of in terms of years of payback, with the investment assumed to contribute nothing to the long-term value of your house. If you install a thermal blanket around yourhot-water heater that costs $200 and saves you $100 per year, it is said to have a two-year payback. Many regard paybacks beyond, say, five years as farther out on a limb than consumers are willing to go. A payback of six, seven, or ten years is too uncertain, too unreal, to be taken seriously. Yet in the world of 401(k)s, we are essentially asked to prioritize investing in a 44-year payback.

The McKinsey Global Institute (part of McKinsey& Company, one of the nation’s most respected business consulting firms) estimates that, world- wide, there’s $170 billion of energy-efficiency investments possible by 2020 that could each generate an internal rate of return of at least 10 percent. The average rate of return of all these investments, McKinsey believes, would be 17 percent.

If consumers had to make all these replacements themselves, even slam-dunk investment opportunities might be difficult to take advantage of. Who has time to study the options, shop for energy-efficiency devices, and make all these complicated calculations? But across the United States are private and public institutions ready to help. New Jersey residents participating in the statewide program to replace inefficient heaters and air conditioners are saving $63 per year. Pennsylvania is weatherizing the homes of low-income families and saving them $300 per year. New York State offers homeowners rebates on their investments in more efficient appliances, typically saving them $600 per year. And according to Energy Trust of Oregon, customers participating in its programs have collectively saved nearly $800 million on their energy bills.

As was true for becoming your own landlord, you bump into limits on this investment strategy. Once you’ve become super-efficient, you again need to look for another place to put your money. Since the typical American household is spending $3,500 per year on utilities and $2,700 on gasoline, it will hit this ceiling once it invests $38,750 to become energy self-reliant.

But there may be ways to go beyond this $38,750. Right now, many U.S. utilities pay you to generate electricity for the grid. Put up your own wind- electric machine or photovoltaic array, and the utility will pay you for the surplus you sell back. Subdivisions and neighborhoods that work collectively to get themselves off the grid and get into the power-generation business may find themselves having a nice income supplement every month. The catch on this, for the moment, is that most utilities will allow you to run your meter back to zero but not negative. Many European governments, in contrast, have mandated “feed-in tariffs,” where the utility not only must buy back your surplus but do so at a higher rate than your electricity bill. This has created a huge incentive for households, neighborhoods, and small businesses to get into the energy-production business. If U.S. states start to reform their utilities in this way, there may be no practical limit to how much you can invest in simple, renewable energy technology that easily will last as long as your house.

The logic of seizing every invest-in-yourself option that delivers better than a 16 percent rate of return can of course extend to other kinds expenditures. It’s worth investing $1,000 in water-efficiency measures, if you can bring down your annual water costs by$160. Or $1,000 in a home-based greenhouse, if you can bring down your food expenditures $160 per year. Or $1,000 in a great bicycle, if it reduces your driving costs by $160 per year. Or $1,000 in an Italian espresso maker, if it shrinks your Starbucks habit by $3.08 per week. But why stop there?

4. Invest in Your Potential

Warren Buffett says, “Generally speaking, investing in yourself is the best thing you can do—anything that improves your own talents. Nobody can take it away from you. They can run up huge deficits and the dollar could become worth far less, you’re gonna have all kinds of things happen. But if you’ve got talent yourself and you’ve maximized your talent, you’ve got a terrific asset.”

Think of how many educational courses you could take, how many new skills you could acquire, or how many new degrees you could complete that would increase your earning power. Forget about enrolling in an expensive private university. Suppose you spend $10,000 per year over three years taking a bunch of classes to broaden your skills. If that $30,000 investment generates more than $4,800 in additional pretax income, your education will generate the needed 16 percent rate of return to do better than your tax-deferred IRA. Adrianne McVeigh, a management consultant and clinical psychologist in Atlanta, tells her clients that “the most successful executives and managers invest time and energy in their own self-development.”

Even if you’re not prepared to change careers, there may be subtle tweaks of your lifestyle that could generate better than a 16 percent rate of return. Everyone knows that prevention of health problems is more cost-effective than treatment. The assumptions required to work out the cost–benefit numbers are admittedly rife with speculation, but there are plenty of low-cost ways most of us would agree would save us more than 16 percent per year. If you’re a smoker, for example, investing several thousand uninsured dollars to quit can pay off in years of longer life with fewer maladies and health-care costs, as well as immediate savings by eliminating hundreds of dollars of cigarette purchases each year. There are similar, if perhaps less dramatic, payoffs by investing in whatever it takes—nutrition classes, exercise programs, spending more cooking healthy meals—to reap the myriad benefits of a healthier you.

Hey, Wait a Minute!

Have I gone too far with these arguments? I can imagine two objections. The first is something I’ve hinted at throughout this chapter—that smart investors will do everything on my list, plus save funds in their tax-deferred retirement accounts.

But I hope I’ve made it clear how far you can go before you should even think about a retirement account. Let’s review: $50,000 to $100,000 for your own bank, $1 million for real estate, $38,750 for energy efficiency, who knows how much for your own education and earning potential—this is well beyond what 90 percent of American families ever dream about saving for their retirement. The average American household has an after-tax income of just over $46,000, and few will retire with anything approaching $1 million to their name.

The second objection might be that I’m comparing apples and oranges. Money saved is not the same as money invested—and ultimately, you do need cash or some kind of income-paying asset to live on when you retire. Your reduced electricity bill will not pay your grocery bill after you turn sixty-five. To make this analysis work, you have to be committed to capturing your savings and placing them into some kind of savings account or asset that ultimately pays you an income stream. But, again, there’s no reason why that asset cannot be your home. And each year, you can take your savings and plow them back into home improvements. When you’re ready to retire, sell the home, move into more modest digs, and then place your savings into very safe, low-risk, local securities.

Whatever you think of strategies of investing in yourself, there’s one overarching advantage to them over every other local-investment strategy discussed thus far: You are the person principally responsible for whether or not the investments pay off. You have the ability to improve your home, to tweak your energy-efficiency systems, and to upgrade your own personal earning power through the right class. You can bring down the risks of your investments going sour. You are the star of your own investment firm.

And it’s in this spirit that I present one final tool to consider, what’s effectively the secret weapon of local investors—namely, the self-directed IRA. Even though the tool is mainstream enough that a “for Dummies” guidebook has been written on it, 99 percent of Americans—even 99 percent of sophisticated investors—appear to be unaware of it.

5. DIY Retirement Funds

Tom Anderson is the founder of PENSCO, one of the largest providers of self-directed IRAs in the country, and until he recently retired he served as its CEO. “After twenty-two years of operation I’m proud that PENSCO has an A+ rating from the Better Business Bureau,” he boasts, “and we’ve got $3.5 billion under administration. From a customer satisfaction standpoint, we’re performing better than some of the top banks in the country.”

Anderson is also the president of the Retirement Industry Trust Association (RITA). “We almost exclusively handle self-directed IRAs and retirement accounts as custodians, which means we provide the means to hold IRA and individual pension plans under the laws governed by the Internal Revenue Service. We hold their assets in custody, execute our clients’ investment instructions, and report the value of their holdings—on an annual basis to the IRS and on a monthly basis to our clients. We also provide all the other traditional services, including Internet access to your account, and your ability to do all kinds of transactions, purchases, sales, transfers, and distributions. Basically we do everything that’s required to keep your plan compliant with the law. And that’s about it!”

The difference, of course, is what you can invest in. “Unlike broker-dealers or traditional banks, we’re dealing with myriad asset types those institutions don’t handle. For example, a broker-dealer like Schwab or Merrill Lynch generally will just handle traded assets like stocks, bonds, and mutual funds, and those assets are essentially processed electronically these days. Our systems and personnel are very specialized as every transaction is unique—sort of like a handmade shoe.

“We can do anything that is not prohibited by law,” Anderson asserts confidently, “from buying 40 head of cattle and putting ear tags on them in the name of your IRA, to buying a property underwater off the coast of Miami. There are only three asset types that a self-directed IRA can’t buy: collectibles (antiques, artwork, a 1957 Corvette, alcoholic beverages, et cetera), life insurance, and the stock of a sub-chapter S corporation. So, for example, we have bought fishing rights in the state of Alaska, which is just a map of the ocean that allows somebody to fish, in this case for black cod, over a period of time, who then rent out these rights to smaller fishermen. We have helped start thousands of traditional businesses through early-stage capital, either at the very beginning like start-ups or with mezzanine financing. At this time there’s very little credit out there for new-business innovation, and service providers like us are stepping into the gap.”

You could use a self-directed IRA to put tax-deferred dollars into almost every local-investment option discussed in this book. The one prohibition is on personal use of the funds. You can’t invest in your daughter’s house, for example, or a business in which your spouse has greater than 50 percent ownership. But you can invest in almost every other type of local investment discussed in this book. That means that you can support a friend or neighbor’s personal project. You even can invest in your neighbor’s house. In Canada, where the rules around self-directed retirement funds are very similar to those here, a company in Calgary is being formed to enable groups of neighbors to invest in one another’s homes, enjoy the tax benefits of mortgages, and avoid the high interest charges of mortgage banks.

Suppose you know someone who wants to borrow money to buy furniture or put her kids through college. You know she has plenty of assets, but they’re tied up in the house or in a typical pension fund, so you’re confident about getting paid back. You could use a self-directed IRA to loan her the money at, say, 5 percent annual interest—or whatever interest rate you preferred. And taxes on your gains would be entirely deferred.

Anderson wishes that more Americans knew about self-directed IRAs. He believes that most retirement accounts are dangerously undiversified. In fact, according to most current statistics available from Investment Company Institute (ICI), more than 95 percent of all IRA assets are invested in the markets in one fashion or another. “These are an individual’s most valuable portfolios due to their tax-deferred or tax-free status, and if any portfolio should be diversified it should be your retirement account.”

On the flip side, self-directed IRAs provide a great source of investment capital and support innovation through the launch of new businesses. “The most significant success we had at PENSCO,” recalls Anderson, “involved a group of entrepreneurs who came into our office in 1999 and wanted to start a business on the Internet. They were going to use a traditional IRA, but I suggested they use Roth IRAs because the gains would be tax-free. So they started this company, and the lead investor put in $1,800, because he didn’t have any more. The limit at the time was $2,000. The others put in a certain amount, most of them the maximum contribution amount. Approximately three years later they sold the company to a national firm, and the CEO, the guy who put the $1,800 in, now had multiple millions in his Roth IRA. Then he took those millions in his Roth and became a lead investor in a whole bunch of other start-ups, which grew his IRA to hundreds of millions. All from his $1,800 investment!”

So why don’t more people use this technique? Anderson thinks most Americans don’t believe they are capable of handling their own finances. “People are accustomed to the normal contributory IRA. They get a solicitation from their bank in April just before tax time to take a deduction, they fill out a little form, and put $2,000 or $4,000 into an account, and it just sort of sits there. They don’t pay a whole lot of attention to it. The whole process is relatively passive.”

The custodian of a self-directed IRA, in contrast, cannot be the decision maker. That’s what self-directed means: It’s up to you.

This article is adapted from Local Dollars, Local Sense  by Michael Shuman.

Shuman shows how unaccredited investors—nearly 99 percent of Americans—can put their money into building local businesses and resilient regional economies, and profit in the process.

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