Podcast

SlowMoney.org

Woody Tasch: Slow Money

Putting capital to work for local food resilience
Sunday, September 21, 2014, 2:31 PM

The Slow Money movement focuses on deploying capital, locally, to strengthen small food enterprises. Its goal is to improve the quality, dependability and sustainability of our food source, while financially nurturing communities and delivering an attractive return on investment to native investors.

Woody Tasch is the founder and chairman of Slow Money - in this week's podcast, he and Chris discuss the templates his organization is piloting across over 350 ventures in local food production, processing, distribution and marketing. $38 million in "slow money" has been deployed to-date, and that amount will hopefully accelerate as the movement's viral and self-organizing expansion gains steam.

The problem isn’t that the system doesn’t work. It's that it works too well for its own good.

We’ve created super cheap, super shelf stable food and in the process externalized all the costs of soil erosion, depleted aquifers, etc. They involve toxins in the environment, chemical interactions they’ve never even studied, all these different things that are kind horrible, carbon in the atmosphere. Some people don’t realize how much agriculture, especially large-scale investor, produces carbon in the atmosphere. So you have a couple hundred years of industrial projects doing that.

Now we’re starting to move back in another direction. If you suddenly start internalizing all the costs that have been externalized for 250 years you are going to face some pretty serious market hurdles. The market doesn’t know how to deal with all of this stuff. So that’s a very big historical thing.

Everybody can’t afford to eat food that has the full cost of food production in it. We all got hooked on this really cheap, subsidized, externalized cost food. Not everybody’s going to wake up one day and go: You know what? I’m willing to pay twice as much for this. I’m willing to pay twice as much for that. I’m going to go down the street and pay the farmer everything he or she needs to make a fuller day on their farm because I know it's the right thing to do. Very few people are going to be able to do that. But some people are.

And I would say we at Slow Money are part of that vanguard. We’re saying you know what? We’re willing to start internalizing all those costs because we’re kind of freaked out, if I can use a non-scientific term, about what things are happening over the next 25 to 50 years and we don’t want to wait till the market strikes. We want to push ahead. 

For those interested, the next Slow Money annual gathering will take place in Louisville, KY, November 10-12, 2014. More information can be found here.

Click the play button below to listen to Chris' interview with Woody Tasch (46m:29s):

Transcript: 

Chris Martenson: Welcome to this Peak Prosperity Podcast. I am your host, Chris Martenson. As we look around the world and we note all of the increasing crises, nearly all of them are the result of clinging to old paradigms regardless of the costs. Entire cities rely on groundwater that drips away towards zero with every passing hour. Money is printed with wild abandon and used to drive rates of return to zero for safe investments, even out to three years if you’re investing in German bonds. Farmland disappears millimeter by millimeter as it blows and washes away. And, all around, it seems as if—it seems like this, that humans have harnessed themselves to a paradigm of being agents of dissipation and/or degeneration.

Well, not so fast there. More and more people are redefining what the word "investment" means, and are seeking and finding ways to combine money and mission into regenerative enterprises. A true leader in paving the way towards sounder, local, and regenerative investing is Woody Tasch, founder and chairman of the organization, Slow Money, a fine individual who I think I last met when I was delivering a talk at the San Francisco Slow Money event. That must have been in 2011, I think. Yeah, it was.

And so Woody, you pioneered the integration of asset management and philanthropic purpose in the 1990s as treasurer of the Jesse Smith Noise Foundation and founding chairman of the Community Development Venture Capital Alliance. And from there, for ten years through 2008, Woody was chairman of Investor’s Circle, a network of angel investors, family offices, and social purpose funds, and foundations that has invested 150 million dollars in 230 early stage sustainability-promoting ventures and venture funds. So Woody, it's so great to have you on the program today.

Woody Tasch: Well, whenever I hear an introduction like that I just get a big headache and realize how old I am. But it is nice to be with you all. Sorry to forget about all that.

Chris Martenson: Ah well! I’m in the same boat so we can commiserate later. So for our listeners Woody, Slow Money, what is it and how does it work?

Woody Tasch: I mean mostly it couldn’t be simpler especially now. I mean, Chris, even in 2011 when you were speaking at our third national gathering, if you just think about how much in the last several years. I don’t know when you’re going to start counting. But the idea that there could be such a thing as money that is too fast. When did that idea become a little more obviously to more people? So there’s also fast trading and Michael Lewis’s book, Flash Boys, and the Flash Crash, and just a lot of things have been happening in the last several years that have gotten the idea out there that there might be such a thing as money that’s too fast. So you say what slow money is, in one way, you say it's the opposite of fast money, and then let people kind of wonder what that might be. And it could be a number of different ways of pursuing that idea. There’s another way to talk about it, which is a type of slow food. And I think it's important to always say that. And depending on how we have this conversation today, we can get into that a little bit. But I was very inspired by Italy in the 2000 meeting with the slow food people over in Italy. And there again, a short way of having that conversation is to say fast food/slow food. So if you want to move in an alternative direction or to a new paradigm, which in the food system you’d move toward slow food. And in the financial system, you’re moving towards slow money.

Now I didn’t actually answer your question yet, which I apologize for. So I’ll just say, on a very concrete level—I answered you on a kind of a paradigm and philanthropical/theoretical level. On a concrete level, it's just a bunch of us putting money into the small food enterprises near where we live. And that’s a very simple thing to say. It's not quite as simple to actually do it. But that’s what we’re doing.

Chris Martenson: Well, one of the fabulous new investment opportunities we’ve featured here numerous times on this show is Farmland LP. It's from like Craig Wichner and Jason Bradford. How does their model fit into the Slow Money framework? Does it map in at all for you?

Woody Tasch: Sure, oh sure. We know those guys well. They’ve participated in a few of our meetings. They’ve taken one piece of the puzzle. It is all a puzzle, right? To try and move from a—you framed it at the beginning in your own words. But I’ll just say it's from the industrial, consumer, extractive economy towards a more regenerative, restorative economy. And it's a puzzle and there’s a bunch of pieces. So those guys have picked off a pretty interesting piece, which is: Can we create a way for investors to invest in a portfolio of farmland that’s going from traditional to organic farmland? And it's a really interesting thing they’re doing, very much needed because in the food system one of the biggest, most audacious structural problems we have is that a very large percentage of the hundreds of millions of acres of farmland in this country are owned by aging farmers and there’s no legacy. It's like where is it going to end up? Is it all going to be owned by foreign investors looking for a financial rate of return? Or, is it going to be owned by the next generation of, let’s say, small, individualized, organic farmers, which would be an idealistic way to frame what we’d like to have. So they’re doing a really important thing. They’re a relatively new firm and they’re kind of building a model to show you can get reasonable rates of return from doing the right thing investing in organic farmland. So yeah, it's very much a part of it. But we’re also doing a whole lot of other things, which I’m sure will not surprise you to hear me say that beyond just the farmland piece, in processing, distribution, farm to table restaurants, CSAs, a whole bunch of things that are needed to try to rebuild local food systems.

Chris Martenson: Rebuilding local food systems—now a lot of the context for how we talk about this need, this urgency for a variety of things, but particularly around local food systems, is just noting the simple fact that once upon a time farming was a net energy positive endeavor. And today it's a net energy negative endeavor, meaning we’re spending ten fossil fuel calories to produce the one that gets to the table. And a lot of that is in the transportation. A lot of that is in the storage and it's in the system of food rather than just the farmer growing it. Although there’s a bunch there too, right, diesel and pesticides, and all that. So as we look into the future it really seems to me that this idea of having small scale, local, and, let’s use this word correctly, sustainable farmed food seems to be really, really important. And I know in 2011 things were really just sort of starting to get off the ground with Slow Money. Tell me what’s transpired since, and how many people out there are looking at it through that lens, that context of, "hey, this is something we really ought to—would like to do. And it's something we really ought to be doing." How many people are getting those dots connected?

Woody Tasch: Yeah, yeah, that’s actually interesting. So I happen to remember in my opening remarks for that event that was our third national gathering, the one you spoke at that we’re referring to. It was in October 2011. And we—I remember the number, nine million dollars. It just sticks in my head because I was basically in my opening remarks saying, "okay. So nine million dollars has gone into a bunch of deals." I don’t remember the number of deals at that point. They said, "is that a lot or a little?" And I was just trying to get us all to think, everyone assembled. Like so what’s happening? So we’ve been talking about Slow Money for a couple of years, investing is starting. How do we feel about the number nine million? And the number nine million was both a tiny amount and a large amount depending on which way you looked at it. From an institutional standpoint, pathetically tiny amount. From the point of view of the beginning of the movement of individuals to start doing something thats very different with their money, not insignificant, not completely insignificant, depending on what frame you want to use. So thank you for asking.

We’ve made a lot of progress in the last few years, still relatively small in the scheme of things. But we just passed 38 million dollars. It's 350 small fleet enterprises mostly in the US but a little bit in France and Canada now. And we’ve had about a thousand chime in, people want to know kind of how many people are doing this. So about a thousand different check writers have participated in that 38 million dollars. That’s not all the people involved in Slow Money but those are all the people that actually took their checkbooks out to write checks into transactions. Some of that money is counted into Farmland, in Craig’s thing, that you just talked about meaning a few of our folks have put money into the Farmland LP thing, and that’s counted in that 38 million dollars. So I still feel kind of like where we were three years ago in a sense to say, it's still a very small amount but it's also not an insignificant amount, meaning to me what’s just as important as the dollar amount and the number of deals that we have many, many thousands of people self-organizing in communities to do Slow Money in various ways, whether it be networks or investment clubs. And I can tell you more about that if you want. I don't know if you want get into those weeds or not. But it feels like--we’re in our fifth year, and it feels like we’re still relatively early in something that is growing and will continue to build. But that’s—I guess that remains to be seen.

Chris Martenson: So I’m still interested in the motivation of why people are drawn to this. Let’s start this way. What’s the demographics of the audiences and the people who are participating? Are these boomers, young people? I see a lot of young people very interested in farming and being involved in, not just farming itself, but distribution, farm to table, the whole suite.

Woody Tasch: I’m actually kind of bad at that in terms of like really understanding the demographics. I’m kind of too far into the ideas to worry about which groups are responding how. That’s my caveat. But I’ll give you just a few things. I’ll say a few things that are kind of obvious. So one, let’s say, psycho demographic, whatever language you want to use, is baby boomers for sure. So I represent—that’s me talking to my peers basically. And it's very easy to be dismissive of different groups when you label them that way. But I'll say, to me there’s something meaningful there. There’s a great—you know about the wealth, the great transfer of the 12 trillion dollars that’s going on and whatnot. But there’s a significant generational theme going on with boomers who have finished raising their families, are inheriting money from their parents, and are basically scratching their heads on being very polite to ourselves. They’re saying we’ve kind of known ever since, let’s say, Vietnam, and Watergate, and the assassinations in the '60s, that things were kind of screwed up. We kind of had this feeling that things were structurally unsound. And we had no clue what to do with it then. And now we’re in our later years and we have some resources. We might be able to reenter that conversation in a meaningful—and I’m really oversimplifying a lot of things here. But I think there is some truth to that.

And then there’s another group at the whole other end, labeled over-simplistically, the millenials who, let’s say, are growing up in the world where they have been questioning hierarchy from day one. It's all about networks. They’re not really corporate people. They’re even wondering if they should own cars. It's like a whole different series of—the gestalt is totally different on that end. And you could say that’s kind of driving crowd funding and a bunch of, let’s say, democratization of finance on that end. And so I think Slow Money does appeal to those two groups in different ways. But I want to go back to what I said to you in the beginning Chris. I don’t pretend to actually understand it that way. I really don’t. I’m really trying to stay focused more on kind of the "what" and the "why," and not the "how"— meaning, let the different groups kind of opt-in as it makes sense to them. But I think it's more important to kind of keep the direction in our minds so that as many people as possible can kind of decide in their own way to do it.

Chris Martenson: Fascinating! Yeah. I’m a parent of a millennial and just seeing how she’s navigating that whole space of—she doesn’t have a car, not that interested in one, very different from the gestalt of when I was growing up. And so it's just fascinating to see how rapidly those generations are shifting. So I understand. It's hard to really get our arms around how large and profound these shifts are. But at heart I think they’re combined in this idea that whether you’re a boomer looking back on the whole thing or a millennial peering forward into it, the whole thing does kind of look structurally unsound, as you said. So I really get that. And I understand that a lot of people really want to participant in—and I know people personally who are participating in this whole farm to table movement, and really living that dream. And you know there was recently an article in the New York Times. If I have the title right, it was something like, "Don’t Let Your Children Grow Up to be Farmers." The premise of which was that even well run, excellently placed, artisanal, small scale farms are not a profitable model. Did you read that?

Woody Tasch: I sure did.

Chris Martenson: Well, what’s your reaction? Then how does that factor into the models that you’re pursuing?

Woody Tasch: Well, that really—that’s like pulling a thread that goes to a lot of different places. But it's good that you brought it up because it's a very recent thing and it created quite a little kerfuffle, as did—I’ll just mention one other thing, which I don't know if we’ll get into. But the New Yorker article on Vandana Shiva a couple of weeks ago and basically sort of calling her a charlatan for questioning GMOs the way she does, and whatever. But let’s stick on the one that you brought up. So there’s like a bunch of corollary issues that are tied to kind of the same, let’s say, I would say debunking what we’re doing because the arithmetic doesn’t work, argument. And I’m going to come back to the "can you make money as a small farmer," in a second. But I think it's important to see what the gestalt is. Here’s a corollary one. "You can’t feed the world. Everybody, we can’t feed the world with all these small farms. We need more production than that. Slow food and farm to table stuff is just for a few rich people and people who, let’s say, drive Priuses to Whole Foods and blah, blah, blah" and dismissing it on sort of a socioeconomic ground and whatever. All of these arguments are kind of the same argument. And the way, the only way that I can make sense of it is to step back and look at it in a broader historical context, which is we are moving from a food system that has systemically externalized social and environmental costs for hundreds of years in the quest for cheap, shelf-stable food.

And guess what? It did it. I mean the system—the problem isn’t that the system doesn’t work. It's like it works too well for its own good, in a sense. So we’ve created super cheap, super shelf-stable food and in the process externalized all the costs of soil erosion, depleted aquifers, you mentioned them before, toxins in the environment, chemical interactions that are never even studied, all these different things that are kind horrible, carbon in the atmosphere—let’s not forget to mention that one. Some people don’t realize how much agriculture, especially large-scale industrial agriculture, produces carbon in the atmosphere. So you have a couple hundred years of, let’s say, industrial projects to do that. Now we’re starting to move back in another direction. The first inklings that we have, don’t all make sense with my arithmetic. Why is that? Because if you can suddenly start internalizing all the costs that have been externalized for 250 years you are going to face some pretty serious, if you want to call them, market hurdles. There are going to be pretty serious market hurdles. That is the market doesn’t know how to deal with all of this stuff. So that’s a very big historical thing.

And maybe I want to say one other thing on that. The elitism argument, which is, again, it's kind of tied to that piece. That wasn’t the direct angle but it's not too far off. It's part of the same argument, like, "Hey, everybody can’t afford to eat food that has the full cost of food production in it." And the answer is, "yeah, you’re kind of right. We all got hooked on this really cheap, subsidized, externalized-cost food." So everybody’s not going to wake up one day and go, "you know what? I’m willing to pay twice as much for this. I’m willing to pay twice as much for that. I’m going to go down the street and pay the farmer everything he or she needs to make a full living on their farm because I know it's the right thing to do."

Very few people are going to be able to do that, but some people are. And I would say we at Slow Money are part of that vanguard. We’re saying you know what? We’re willing to start internalizing all those costs because we’re kind of freaked out, if I can use a non-scientific term, about where things are heading over the next 25 to 50 years and we don’t want to wait for the market to try to figure it out. We want to push ahead.

So that is a very big frame to what you just said Chris. And pulling it back down, I’d say individual farmers, as well as others in the food system who are moving in the other direction, face all kinds of head winds. They just do. It's the nature of the beast. Now before you pooh-pooh and say, "you can’t make money as a small farmer," I would say, there are many statistics that point in the opposite direction. So if anyone wants to look at the number of farmers markets and the number of CSAs, and the fact that the USDA census, the last census was the first time in like 75 years that the number of small farms actually went up. There’s a lot more indicators than that. I mean organics has been growing at, let’s say, double digits for a long time. It’s the only sector in the food system that's been growing like that. So there are plenty of indicators that consumer demand, consumers who can afford to internalize some of the costs and the producers and distributors and whatever who are making the food for them, it is growing. It's a growing trend. To pot shot by picking out certain individuals and saying, "they just can’t make it..." Yeah. There’s going to be a lot of failures.

One last thing, I’m trying to touch on a lot. It's a very big system question that that article raised. One other quick important brush stroke. It sounds like it's non-secular, but it isn’t. This is if you’re talking paradigms you have to be willing to kind of look at all the pieces. Look at venture capital as like the paradigm for how you invest in early stage high-risk ventures. And guess what? A startup farm is an early stage, high-risk venture. It's just a low tech, small, locally placed, high-risk venture.

If you got under the hood and looked at venture capital, which is supposedly the, let’s say, the gold standard—if I can use a charged metaphor here—as the gold standard of how to invest in high-risk situations, it turns out that doesn’t work very well either. And I’m making—you may ask me to defend that a little and I will if you want me to give data. But there’s just lots of carnage, early stage things. Entrepreneurship is hard on all levels. The fact that if you happen to bet on a Google you get to make a thousand times your money masks a lot of the carnage. And on the food side, if you get it right, you just get a nice couple of farms that are great but you don’t get to make a huge financial upside. So all of those issues are embedded. I just talked around kind of a pod there, a lot of different pieces that are all kind of raised by that, by the spectre of that article in the New York Times.

Chris Martenson: It's that same spectre that shows up all the time when people are analyzing alternative energy and say, "yeah, but on a cents per kilowatt hour look how expensive this is" without noting that, again, all these externalities, as you call them, the pollution that comes from fossil fuels, but the extraordinary subsidies that they receive in terms of military protection and however we want to account for that, in terms of direct subsidies that they receive in tax breaks and things like that, which number in the hundreds of billions of dollars in the United States alone. And then, of course, yeah, the comparison’s a little unfavorable because you’re basically taking something where you’re burning and squandering and that cost is just baked into this thing so it feels good and light. So when I get corn from Iowa from a farmer who’s basically burning through topsoil, it's cheap. Yeah. It is cheap. No question about it.

So what you’re talking about here is that we have to start valuing other things besides the pure, raw, simple economics as they’ve been fashioned over a period of time that’s clearly delivered to us a fairly unsustainable system. How do we go about doing that though? How do people become educated about and begin valuing other things? Like, I might value, okay, my food costs a little more. It costs me a little more financially but I know that those farmers that I’m buying it from are building the living capital over there on the farm they’re growing it. They’re getting better soils and their soil structure and topography and microbes are richer and better than they were when they started. And I’ve got this social capital I’m building with them as well. It feels good and all of that. How do you go about—is that just an education process? Or, how do we go about doing that? How do you do that?

Woody Tasch: Well, it's great that you went there because what I was just thinking of while you were articulating that question, we were kind of going the same direction. So the word "culture" is what was in my head. And I was thinking about relationships versus transactions. And then you kind of went to like how do we learn? You raised a question about learning. This is about culture. This isn’t about economics. It's about what’s more important, economics or culture? And guess what? In the United States, we have spent the last hundred years proving to ourselves that economics is much more important than culture. Now that’s a very incendiary statement to some people. And we could debate it if you want. But I would—I’ll just try—I’ll throw this out as like a dinner topic, a dinner table conversation. If you had a bar chart and it somehow showed in some weird metrics, economy versus culture, and where the bars were in 1900 in the United States, and where they are in 2000 and 2014, I would say the economy has grown tremendously. The culture has been degraded. And, of course, we can debate that because culture is an intangible. It's subjective. It's about quality. It's not about transactions. It's about relationships.

And to me, there’s no question that we went—we bet, let’s say, all-in on transactions, on technological innovation, on economic growth, on capitalism, sort of arguing endlessly in public, "capitalism is the answer. Capitalism is—if you question it, then you must be a socialist or you must be a member of ISIS or you must be something." But we’ve gone so far in, in such a fundamental way, in such an extreme way, that it's like we don’t want to value relationships anymore. Relationships are squishy. They’re not real. You just mentioned some. Relationships in the soil. And there’s so many interesting facts about how little we understand about how fertility is created in the soil. But all you need to—for the point of this conversation, let’s just say, there are billions of microorganisms and species in the soil, thousands of species and billions of microorganisms in a gram of fertile topsoil. Most of them have never even been named yet. And I always think to myself, "God, that’s great. Let’s not name them. Just leave them alone." Because if we try to name them we’re probably going to end up killing them.

So that’s relationships in the biology sense. Relationships in the cultural sense aren’t that different. If you have—so when you were framing your question, I want to go back to the word "culture." I thought of France. And I know it's a little goofy, France or Italy. And if you think about it, here’s a place where we can start talking about where economy and culture meet, just one tiny little place. And it's around food. So I’ll do it as a quiz to you Chris. What does a typical French person, what percentage of their household budget do they spend on food?

Chris Martenson: I don't know. We’re 14 percent here in the US. I’m going to go a little higher, 20 percent?

Woody Tasch: It's less than 14—I don't know where you’re getting that 14 percent from but I believe it's quite a bit less than 14 percent in the US. But they’re over 20 percent. So the numbers I usually use are 10 percent and 20 percent. And I believe those are close enough to be representative. So then the question is, does that mean French people are stupid? Are they stupid because they pay twice as much of their household income for food? They just didn’t realize that they could go get the food cheaper in some other place?

Chris Martenson: No, I’ve eaten…

Woody Tasch: Or, is it because they value it?

Chris Martenson: I’ve eaten in France and I want to go back and do it again. It's so spectacular. It's like art on my plate. It's just, it's wonderful.

Woody Tasch: Yeah. And just remember we’re not just talking about fancy “French Restaurants.” We’re talking about the typical French household buying food and preparing food at home and whatnot. So that’s culture. Culture could allow us to value things differently. In the US we have a very transactional culture. It's all about buy low, sell high. And that’s filtered through every element of our culture down to and including fast food, of course, which is maybe the most extreme example of, "how can I get food the fastest and the cheapest? How can I get calories the fastest and cheapest?" And the taste masks it by having lots of sugar and fat and salt in it. So that’s what you get when you go all the way in for transactions and you sacrifice—you don’t value the culture part. So anyway, I’m sorry that I seem to be on a little bit on a role here on this stuff and I don't know why.

But when you were framing the question, what I was thinking about is culture. You said, how do we learn to do this? And it is—it's a little daunting when we say it like that because it seems like such a huge historical project. Like how are we going to reintroduce culture of a different kind in the United States. But I actually think that’s the task. So it's way bigger than any one financial technique, way bigger than any one asset class, way bigger even than the idea of local economies and local food. It's about relationships. It's about getting people to enjoy—and I’ll use a positive word—enjoy the rewards of rebuilding relationships that have been broken by our, let’s say, overzealous pursuit of transactions.

Chris Martenson: This is a topic I gnaw on constantly and most of the times I’m sort of overwhelmed and daunted by the whole idea. Like how do we refashion this whole thing? And I know a lot of people share that daunted sort of view. And on the other hand, it's actually very simple. As humans the whole idea of written language is very late in the game. The rest of the time we were storytellers. And now the older I get, Woody, the more I believe in the power of narrative. And so we’ve been running with this narrative that’s reinforced literally hundreds of times per day, if you’re a reader at all, which says, "we need an economy that grows. We need jobs that grow. We need more houses sold. We need more cars." And so we’ve enforced this narrative of growth in our economy. And that fundamentally—there’s no requirement that our economy has to grow, but our money system has given us that, has bequeathed that little feature to us. And the next thing you know, we’ve fashioned all these sub narratives around that. What’s the best way to get the economy to grow? Well, you get consumers to consume a lot. How do you do that? Well, we grow—it's best if they all live in their own houses and they all have their own cars. And that creates this sort of nuclear framework but ultimately leads to a very fragmented, isolated sort of experience for a lot of people. And then one day those people wake up and they go, "this isn’t actually that awesome. It's been billed as awesome but it's not actually an awesome way to live." And so if we can get a new narrative back in there that says, "listen, there’s a happier, healthy, more wholesome way to live that’s more in alignment with our, I’ll use the term, our DNA blueprint. This is how we’re built. This is the hardware and the software. It's best to use it this way." It feels to me like what you’re doing is creating the conditions for people to start reexperiencing what I’m going to call normal human life.

Woody Tasch: I couldn’t agree with you more. I mean I have my own, let’s say, lexicon that I’ve developed over these last five years while talking about slow money. One of the phrases I use is "the soil of our restorative economy." And that’s meant to combine like a metaphor and a reality. So if you put your hands in the soil, if you actually put your hands in the soil, if you actually garden and grow some of your own food, whatever, there’s an immediate reward you get from that. And you know, I can list—if there’s a financial skeptic listening to me say, like what in the hell is he talking about? That’s bullshit, whatever. Well, you can say it's bullshit if you want. You might be more apt to say that if you’ve never done it. So if you kind of follow this list a little bit it gets to things like, okay—I heard someone say this to me once, "Woody, why are you spending so much time trying to garden? You have a movement to grow and you have this, and all your things. Your time is worth way more than that." And I said, okay, so yeah, fine, do a traditional analysis of how much each head of broccoli that I’m growing in my garden is going to cost me based on the market value of my time. You’re going to figure out that I’m spending, whatever the number is, 30 dollars in terms of my actual time and energy to have a head of broccoli instead of going to the store and buying the same thing for a few bucks. It doesn’t make any sense from an economic standpoint. But guess what? And I’m going to say some—I have to finish this, It's like the Master Card commercial that says "it's priceless."

It's kind of silly in a certain way. But when you grow a little of your own food and you actually put your hands in the soil, you actually get a reward. You don’t need an economist to measure it. You don’t need some third party to certify it. And you don’t need to put a price on it. It's a natural reward. I’m being very personal here. That’s a very specific thing. One-step away from that is small groups of people giving loans to organic farmers in their community. It's one-step away.

I’ll be a little more specific. We’re doing it in Boulder. We have a slow money club in Boulder. There are 27 of us. We each put five thousand dollars into an LLC. And we’ve made, I think we just made, what was it, our ninth loan and we’re up to about 95 thousand dollars, so. And these are a half dozen little food enterprises in the Boulder area. And it's the next best thing to putting your hands actually into the soil because there’s a reward to it. You said "happier" in your last statement, and this is about doing something that has innate value from which you get rewards that are not completely monetizable. And I know that sounds really crazy to the side of our brain—I won’t even say to other people—I’ll say it to our own side of our own brain that’s been trained to measure and monetize everything, and the time value of money, and all that stuff. But when you actually do it, if you let yourself do it, and you really kind of allow yourself to kind of feel some of the cultural implications of it, you get an immediate reward. And it's not all that squishy. It's real.

Chris Martenson: It's not at all squishy for me. I’ve got a huge vegetable garden. And I believe my broccoli costs a lot more than that even, based on my output. But I love doing it.

Woody Tasch: [Laughter] I’m a way better gardener than you are Chris.

Chris Martenson: [Laughter] On a dollar per head basis, you are. But I was just—I’ve grown corn this year for the first time in a long time. And it's just been really coming into its full sweetness here in September. And I just derive so much enjoyment from the whole process, from the whole cycle of gardening, from beginning to end. And it's just fantastic. And so I think that’s a great way to look at it, which is how are you gardening your community? So that is a great metaphor, that line that you put there.

So I note that the great state of Vermont, that’s one state to the north of me, it's about to launch Slow Money here in September of 2014. What does that mean? And what can the people of Vermont look forward to from here?

Woody Tasch: Well, I’m glad you asked about that. And before I answer, just because I don't know how much longer we’re going to go, and I don’t want to forget. I just want to say the words, Louisville. And this sounds like a complete non sequitur, Louisville, Kentucky, November 10th thru 12th—Wendell Berry and Amy Domini. That’s the next Slow Money national event. But next week I’m going to be coming to Vermont.

Chris Martenson: I love Louisville.

Woody Tasch: So I just wanted to get that in. But I am going to Vermont next week for the launch of Slow Money Vermont, which is very intriguing to me since there is stuff in my book—my book is now five plus years old. And there’s actually data in the book from a study we did in Northern Vermont. And this was well before the thought that something called Slow Money was going to become an organization or a network or anything else. It was just me thinking out loud and exploring and trying to kind of arrange a mosaic that maybe made some sense. And I looked at a bunch of small food enterprises in Northern Vermont. And arguably, Vermont is, let’s say, the most advanced state in the union in terms of local food systems, small-scale agriculture, family farms and whatnot, arguably. I mean there would be other states would want to get into the debate I guess.

So it's intriguing to me that now here we are sort of five years after Slow Money has actually flourished, let’s say, in lots of other communities. And for the longest time, people in Vermont were kind of, "well, what do we need Slow Money for? We are already doing it. We don’t need another organization here." And that’s not for me to say. But now gradually a bunch of people who have been coming to some of the Slow Money national meetings, or whatever, said, "you know what? I think there’s something here that could be useful."

I'd say how it works is simple. Slow Money is just a kind of a tent, if you want to say. It's just a way of getting people together. It's a set of ideas. We do have something called Slow Money Principles that people can go online and sign if they want. We’re getting close to around 30 thousand people signed them. And it's kind of a value statement about—it starts by saying, "we must bring our money back down to earth." So you can see how general it is. It's very broad.

But it's about many of the things that we’ve been talking about today, about a paradigm shift from, let’s say, extractive economics to putting back into the soil what we take out. And those ideas have proven useful as a way of just getting people in the room together and getting turned in the right direction. So the folks in Vermont who have been doing this for a while without the label, Slow Money, have decided—and I didn’t have any interaction with them actually. I just learned that they want to start a Slow Money network in Vermont. Once you start it's just a way of getting—I think we’re expecting something like 75 to 100 people in the meeting in Montpelier. I’m not sure about that but a decent turnout. And once you get people in the room together you start exploring how to do this deceptively simple thing, which is taking some of our money away from the abstract capital markets and putting it to work in small food enterprises near where we live.

How you do that can take a variety of different forms. None of them are rocket science. You can form an investment club that’s an LLC that has certain guidelines to it. You can form a non-profit investment club. We have one of those. It’s a small ______ [00:33:57] where the money goes in as a donation but then stays in and creates, in a sense, like a revolving loan bucket, if you want to think about it that way. You can just have a network, completely informal, meaning no legal structure at all, and no capital contributions of any kind. You can bring people together over a long period of time and entrepreneurs who need money find it from individuals who have it in various permutations and combinations.

And that last one that I just said to you is the way most of the 38 million dollars has changed hands in the United States. No formal legal structure, just groups of people meeting on a repetitive basis in the places where they live, and finding things they want to do together. It's a totally non-fiduciary model. So from a paradigm standpoint it would drive any professional investor or any quant crazy because it's really kind of the opposite approach.

Chris Martenson: So Slow Money is now operating in how many states, all of them?

Woody Tasch: No. We have 20 networks that we kind of officially count. We have 40 local groups that have signed our guidelines, but in about half of them there’s real investing going on. So we try to be careful how we count. So we’ve got 20 groups around the country. That’s actually including two in Canada and one in France. So 17 in the US, three outside the US, where investing is happening on a regular basis. And then we’ve got 13 investment clubs. I described them briefly, those little LLCs or non-profits where people are chipping a little money into a pool. And then we have, let’s say, dozens of other places where people are like, say, Vermont, are starting to think about how they can do this. Let’s have a few meetings. Let’s see if we have the traction here.

It's like anything. It doesn’t take everywhere all the time. Sometimes people can have a false start or two. It requires, let’s say, a handful of people who really want to stick with it. And luckily we’ve been finding that there’s dozens of places where that happens. And I’m sure Vermont will be one because of the cultural and economic situation. I’m sure that the Slow Money network will find lots of things to do and we’ll have kind of a happy time with it.

Chris Martenson: Absolutely. If you can’t make Vermont work, it's not going to work at all because that place is just already like right in the wheelhouse for you guys. It went by a little quick. So Louisville, Kentucky, that’s the national gathering this year. When is that?

Woody Tasch: So thanks for returning back to that. I appreciate it. It's November 10th to 12th. I’m very beyond pleased to be able to say Wendell Berry is kicking off the thing. We’re collaborating with him and his daughter. Most people who think of this may know that Wendell Berry is kind of a patron saint. He’s like a pope of, say, small farming, and alternative ways of thinking about farming and culture and economics and whatnot. So we are just really, really gratified, and excited to have his voice there. But we have Vandana Shiva, and Joel Salatin, Patrick Holden from the Sustainable Food Trust in England, Amy Domini, the founder of the Domini Social Fund. She’s just a long time kind of leader in, let’s say, impact investing or social investing. So we’re very excited. It's in the Kentucky Center for the Performing Arts, which is just like a crazy, large, beautiful venue for us to meet in. And we’d love to, say, have more people in the tent for obvious reasons, for all kinds of reasons. So hopefully we’ll be able to attract some new folks there.

Oh, to answer your question, about 35 states are usually represented at the gatherings. They don’t all have networks there but we get people from 35 or 36 states and usually several foreign countries. And we expect that to be the same or even a little more this year.

Chris Martenson: And anybody who’s wondering about Louisville, I went there, I think it was two years ago and gave a talk. And really, it's got—it's a tale of two cities. It's got the obvious decaying infrastructure from the old industrial side. And then there’s this really nice emergence going on of farming, small farming, craft bourbons, really, really fascinating art installations and projects that are going on. So it has this whole vibrancy as well. I was really impressed and came away from Louisville thinking that was really just a place on the move. So great location I think you’ve picked there

Woody Tasch: Yeah. It's almost enough to turn me into a bourbon drinker.

Chris Martenson: [Laughter] It could be. So for those listeners who really want to find out more, maybe they want to participate, contribute, invest, so who can they contact or where should they look for more information here?

Woody Tasch: Well, my website it's SlowMoney.org. So everything is there. I guess I want to say one other word. I guess I’m glad I thought of this before we quit. And the word is Beetcoin.

Chris Martenson: Beetcoin….

Woody Tasch: Okay. Did I leave a slightly pregnant pause after I said that?

Chris Martenson: You did [Laughter].

Woody Tasch: So we are going live with something called Beetcoin sometime very soon, like within a week I guess I’d say. And if you just think of, A, the opposite of Bitcoin. And by the way, I don't know. You may love Bitcoin though Chris. It's a whole other topic of discussion. But I don’t think we have to really get into that. All we have to say is, what’s Beetcoin? It's a way for people to put money into—it's just a simple device to get people’s attention in this world where people online have very quick attention spans to say, "hey, if you want to do something that’s concrete, that’s putting more fertility in the soil, and more healthy, local, organic food into your community, and whatnot, chip in a little money by buying a Beetcoin." It's not an actual currency. I like to think of it as an imaginary currency that has as much value or more value than that digital currency. But that’s a whole other conversation. So just stay tuned. If Beetcoin sounds a little bit intriguing, I ask that you stay tuned. And soon on our website will be a page that explains what Beetcoin is.

I’ll maybe tell you one last thing. I know this is mysterious. It's a way for people to chip in to get some money to some of the entrepreneurs that will be presenting on the stage in Louisville. So we’ll have about 15 or 20 food entrepreneurs from around the country doing everything from processing and distribution to grass-fed livestock production, small scale dairy, the full gamut, farmland investing, the full gamut. And if people can’t come but they want to chip in a little something, Beetcoin will be a way they can do that.

Chris Martenson: Nice. Fantastic. So as we close up here, I just, I’m wondering about your general views. Now you’ve been at this, what, five years. And as you look around, does this—how does this feel to you? Does it feel like necessary but insufficient? Is it a case of—do you ever get the charge of too little too late? Because I, all the time, run into people who just have a monstrous sense of urgency like we really got to be doing this. We need a Manhattan Project times an Apollo Project times some whole number like ten. And how do you respond to that? Where’s your head at?

Woody Tasch: Yeah. That’s a big imponderable. I have a couple of quick sort of off the top answers to it but, like I said, that’s just a big imponderable. So one is since I mentioned Wendell Berry I’ll kind of default back to him a little bit. And he’s been living and writing about this for almost 50 years now. And he wrote a really amazing essay when he was a young man. He wrote it in 1969. And it was about a protestor at the University of Kentucky. He was protesting the War of Vietnam. And he actually wrote about the futility of political protest. And I don’t have time to get into the whole thing. But remember it's 1969. So times are a little bit different. And he basically said, "well, we just need every individual to start changing the way they live, the way they relate to the earth and to every piece of land that they’re entrusted with, and not trying to fight big abstract, political battles against institutions, and blah, blah, blah." So when you talk about daunting, like change, when you talk about change and going up against these huge forces that seem to be completely out of control, still going in the wrong direction, it is imponderable. It is daunting. But I do tend to go to a Wendell Berry thing, which is: I can’t control all that, but I can control myself. And so that’s thing one.

Thing two, because I have been speaking about Slow Money for the last five years, I have come to believe that there are millions of Americans. That number is made up but it's not a goofy number. I’m not a goofy person. I’m too old to be that goofy at this point. I do think there are millions, I don't know how many millions, but millions is good enough for me, who really feel in their bones what we’re talking about. And if we could just give them a few more opportunities to start moving in the right direction I believe there’s some reason to believe that they will start moving in that direction.

Now lastly, I’ll say, are we walking that scale fast enough? Look, what’s the answer? The obvious answer is almost certainly not. But I’ll answer it in a more personal way. And it kind of goes back to Eliot Coleman a little bit. It's interesting thinking about Eliot Coleman, the iconic farmer who talks about feeding the soil, not feeding the plant. And it's just an amazing example of someone who’s been doing the right thing for his life. And I once said at a conference that I’m 99 percent pessimistic and one percent optimistic. But I wake up every morning and the one percent says, "there’s plenty to do that day."

Honestly Chris, that’s my personal answer to you. That’s how I feel about the odds of us pulling out of this trajectory we’re on as a culture, like there’ll be enough move enough fast enough, very low. That’s how it feels to me. It doesn’t mean we shouldn’t keep trying. And as I said before, there are immediate rewards to putting your hands in the soil. I actually believe that. It's not all about pain and suffering and struggle. There’s some immediate rewards for going in the other direction. Elliott—the reason I mention Elliott, he said to me one day after I made the 99 percent pessimistic and one percent... he said, "I totally disagree with you. I’m a 100 percent optimistic." I said, "what? You are? How can that be?" He said, "because I’ve been—40 years ago I moved to a rocky, pine forest on the coast of Maine and I’ve turned it into a fertile farm where people are clamoring for my food from within 50 miles of the farm. He said, if I can do that I know anything is possible." So that’s—maybe that’s a little too something for listeners but I’m somewhere between Elliot—you know, I’m still sticking with my 99 percent/one percent, I guess. Maybe I’m too old to change at this point.

Chris Martenson: Alright. Well, my catch phrase is always around necessary, but potentially insufficient. And here’s what I’m a 100 percent sure of. The current paradigm of the way we live is not going to continue, because it can’t forever. And I don't know when it's going to finally shift. But I think it's already shifting under our feet as is. And so our choices include either doing nothing about it, facing it square on, or just ignoring it completely. And I’m of the kind that says, "well, if this is the reality we happen to be living in, so let’s deal with it." And when I first started all this Woody, I was actually propelled by a desire to escape some sort of calamity that might be coming. And now that I’m fully in it I realize I would run towards this life because my deeper, richer sense of community and my relationships both human and with the land around me are far deeper than before. And now I understand that there’s real benefits here. It's kind of like I finally discovered water. All my life I’ve been living without water and as soon as I discovered it I’m like, "man, that is good stuff. I got to get me some more of that." [Laughter] And I realized that, yeah, it's pretty parched in our normal existence, what is asked of us to be good consumers is a pretty sterile, parched sort of a landscape for me now.

And so that’s really the key message that I’ve been sort of circling around is this idea that, yeah, it's easy, lazy money is taking your money and giving it to Wall Street and crossing your fingers and hoping it grows. It's true. Entrepreneurship and building small businesses is hard work. That’s hard money. Not that you have to do all the work of building the actual business if you’re the capitalizer of that, but you do have to do your due diligence. You got to roll up your sleeves. You got to understand what the business is about. And yes, that’s hard work, but boy, it's rewarding and it's fulfilling work as well.

Woody Tasch: I guess I would just say "here-here" to that. I have many stories I could layer onto that but clearly we’re, let’s say, we’re plowing the same ground, if you want to use a farming metaphor.

Chris Martenson: Indeed we are and I’m really glad we’re on the same field plowing that field. So we’ve been talking with Woody Tasch, founder and chairman of Slow Money Foundation Organization. So check out SlowMoney.org if you want to find out more. Woody, thank you so much for your time today.

Woody Tasch: Hey Chris, it was great talking to you. We should stay in a little better touch.

Chris Martenson: Let’s do that.

About the guest

Woody Tasch

Woody Tasch, founder and chairman, pioneered the integration of asset management and philanthropic purpose in the 1990s as treasurer of the Jessie Smith Noyes Foundation and founding chairman of the Community Development Venture Capital Alliance. For ten years, through 2008, Tasch was chairman of Investors' Circle, a network of angel investors, family offices, and social purpose funds and foundations that has invested $150 million in 230 early stage sustainability-promoting ventures and venture funds, since 1992. Woody is the author of Inquiries into the Nature of Slow Money: Investing as if Food, Farms, and Fertility Mattered (Chelsea Green).

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11 Comments

Arthur Robey's picture
Arthur Robey
Status: Diamond Member (Offline)
Joined: Feb 4 2010
Posts: 3936
The Easy Dividend. (Don't try so Hard.)

Totally concur. Thank you for podcasting something "real".

I am growing date palms out at Salmon Gums. I started out trying to grow a cash crop and came a cropper. I laid out many kilometers of dripper line, spent hundreds of hours getting the 120mm. diameter siphon to work and spent days in the baking sun, covered in our famous flies.

Total waste of time. All the Paulonia died.

I found out that dates were contented with the soil conditions (Internet). I bought some plants at $120 each, spent time and effort planting said plants in the hard clay. Next I bought Medjool dates from California and germinated the seeds and planted the resulting trees out. With no irrigation.

Are you detecting a trend here? Cheaper and cheaper, easier and easier. Now I just eat the date, scruff the ground with my boot, drop the seed and cover it.

The One Straw Revolution. (What do I not need to do in order to get the same yield?) Do yourself a favour. Buy it. Even better- read it.

And

But I have to include Paul Stammets. The soil should smell like the soil. If you take a handful of broad acre intensive agriculture soil and smell it, it is sterile. If you take a healthy, living soil full of mycelia it smells good enough to eat. That is what will put food on your plate. It comes from these observations. Weeds are natures scabs. If you wound the soil you get scabs. So do not fiddle with the soil. Leave it alone.

And we won't be abusing the word "sustainable" any more, will we?

 

Thetallestmanonearth's picture
Thetallestmanonearth
Status: Gold Member (Offline)
Joined: Feb 28 2013
Posts: 319
Great interview

I love this podcast because it was inline with my moral leanings and it acknowledges that which is hard to articulate in our culture: wealth is rooted in agricultural capital (the carrying capacity of the land where you live) and social capital (the people you cooperate with in order to coexist), not in financial or industrial capital.    Oil, gas, coal and nuclear have allowed us to unlearn these lessons and become unhappy, over-medicated autonomous drones all pursuing growth for growths sake (willingly or not) because that is the direction the toxic river is flowing.  It occurred to me when Woody was discussing culture that what he was driving at is similar to the idea of permaculture.  A way to live that focuses our individual and collective energy on regeneration, rather than destructive consumption.

This conversation stood head and shoulders above many recent PP podcasts which have seemed to focus more on market moves and how to protect ill-gotten gains made during the latest run-up to the still unscheduled "next crisis".  No offense to Dave Fairtex and others of his inclinations, but participating in wall streets games, even if it is in anticipation of protecting your "wealth" from a collapse is inherently an endorsement of the wrongheaded philosophical underpinnings of growth and global industrial culture. It is impossible to completely disengage at this point, but we should all be making every reasonable effort to grow our relationship with soil and people and reduce our relationship with money, media and large institutions of all sorts that are past their pull date and just don't know it yet.

Time2help's picture
Time2help
Status: Diamond Member (Offline)
Joined: Jun 9 2011
Posts: 2720
Great interview
Thetallestmanonearth wrote:

This conversation stood head and shoulders above many recent PP podcasts which have seemed to focus more on market moves and how to protect ill-gotten gains made during the latest run-up to the still unscheduled "next crisis".  No offense to Dave Fairtex and others of his inclinations, but participating in wall streets games, even if it is in anticipation of protecting your "wealth" from a collapse is inherently an endorsement of the wrongheaded philosophical underpinnings of growth and global industrial culture. It is impossible to completely disengage at this point, but we should all be making every reasonable effort to grow our relationship with soil and people and reduce our relationship with money, media and large institutions of all sorts that are past their pull date and just don't know it yet.

Amen Dude.

robie robinson's picture
robie robinson
Status: Diamond Member (Offline)
Joined: Aug 25 2009
Posts: 1133
agrarian or distributivism

Tallest and Time2help, thats what we might be

robie robinson's picture
robie robinson
Status: Diamond Member (Offline)
Joined: Aug 25 2009
Posts: 1133
distributivism ( a wiki excerpt)

According to distributists, property ownership is a fundamental right[4] and the means of production should be spread as widely as possible rather than being centralized under the control of the state (state socialism), a few individuals (plutocracy), or corporations (corporatocracy). Distributism therefore advocates a society marked by widespread property ownership.[5]Co-operative economist Race Mathews, argues such a system is key to bringing about a just social order.[6]

robie robinson's picture
robie robinson
Status: Diamond Member (Offline)
Joined: Aug 25 2009
Posts: 1133
Slow money gathering

Who is going? I find that time of Nov. slow on the farm so i'm in.  robie

Thetallestmanonearth's picture
Thetallestmanonearth
Status: Gold Member (Offline)
Joined: Feb 28 2013
Posts: 319
Who is going? I would love

Who is going?

I would love to attend, if only to see Wendell Berry speak, but it's too far to travel for me just for a conference.  I hope you'll report back about what you learn there!  Have fun and take notes.

Wendy S. Delmater's picture
Wendy S. Delmater
Status: Diamond Member (Offline)
Joined: Dec 13 2009
Posts: 1978
great podcast

I enjoyed this so much, and learned things. Not sure if we can make it to Kentucky in November but we mean to try.

Uncletommy's picture
Uncletommy
Status: Gold Member (Offline)
Joined: May 3 2014
Posts: 426
An Uphill slog anyway you look at it!

Good interview and right on target. But I wonder how relevant it is to the rest of the world. India just announced it is in the space race with its recent launch. Great, another billion plus looking to technology to define our future. How many more Indian mouths will this feed? 

Had three of my children head out to the acreage from the city to collect onions, potatoes, carrots, zucchini, and a jar of raspberry jam.  Am I part of the solution, or a contributor to the problem? Very interesting discussion, but couldn't help hearing what WASN'T said. Last comments by Chris and Woody left me feeling hopeful for the 1 percent, but overwhelmed for the rest. Keep at it, guys. . . maybe there's still enough time to make it happen. 

robie robinson's picture
robie robinson
Status: Diamond Member (Offline)
Joined: Aug 25 2009
Posts: 1133
I've got two going with me

got room for two more. Let me know by PM soon.

husband,father,farmer........

 

robie robinson's picture
robie robinson
Status: Diamond Member (Offline)
Joined: Aug 25 2009
Posts: 1133

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