ALICE in (Economic) Chains
How we change the story before ALICE doesn’t live there anymore…
Where Are We?
As a society, we are in a transactional economy. What this means is that everything is attuned, developed and continuously refined to support the model that values monetary capital transactions above all else.
One of the outcomes of this framework, is that vast resources are dedicated to creating more consumer products to benefit the few at the expense of the many. This pattern is succintly expressed in the high tech economy’s motto coined by Mark Zuckerburg:
So, here we are, a broken society seeking distraction from the truth of our economic situation. And, capitalism responds to the market’s wishes making it cheaper to fulfill your wants and increasingly more expensive to meet your needs:
It’s from this story ALICE is born.
There is a new classification for Americans, created by United Way’s United for ALICE program:
“They make too much money to qualify for help but still can’t afford basic necessities. They’re a group that’s fallen into gaping holes in America’s creaky safety net, and their ranks are growing.
Those Americans are known as ALICE — or Asset Limited, Income Constrained, Employed. The term, created by United Way’s United For ALICE program, describes the Americans who may not qualify for services like food stamps or other benefits but still aren’t making enough money to get by. They’re above the poverty line but still in a tight economic position.
Part of that is due to a poverty line that’s out of touch with how much Americans need to survive. Poverty rates have been falling across America, but the share of ALICE is on the rise in many states — and the share of Americans above the ALICE threshold is similarly falling. And Americans who are otherwise economically marginalized tend to fall into the ALICE bucket.” ~ Meet the typical ALICE: Americans struggling to afford basic necessities but making too much to get help
ALICE is Everywhere
ALICE is Everyone
Most Americans are one or less paychecks away from losing their tenous hold on a safe haven.
More Americans may be struggling to make ends meet. A majority, 65%, say they live paycheck to paycheck, according to CNBC and SurveyMonkey’s recent Your Money International Financial Security Survey, which polled 498 U.S. adults. That’s a slight increase from last year’s results, which found that 58% of Americans considered themselves to be living paycheck to paycheck.
While last year’s survey polled more than 4,000 U.S. adults, this year, CNBC took a worldwide look at personal finance. The 2024 survey polled 4,342 adults altogether and included 500 adults from Mexico, 503 adults from Australia and 482 adults from Singapore.
Of those who said they live paycheck to paycheck, 35% said they would need to make $50,000 per year to feel financially secure, 44% said they’d need to make $100,000 per year and 11% said they’d need to make $500,000 per year. ~ More Americans say they are living paycheck to paycheck this year than in 2023 — here’s why
How did ALICE fall down the economic rabbit hole?
First we need to understand how we got here…
The modern interpretation of the American Dream is far removed from its original meaning:
“The American Dream” has always been about the prospect of success, but 100 years ago, the phrase meant the opposite of what it does now. The original “American Dream” was not a dream of individual wealth; it was a dream of equality, justice and democracy for the nation. The phrase was repurposed by each generation, until the Cold War, when it became an argument for a consumer capitalist version of democracy. Our ideas about the “American Dream” froze in the 1950s. Today, it doesn’t occur to anybody that it could mean anything else. ~ Sarah Churchwell, ‘Behold, America’
A Broken Social Contract Leads to Prioritizing Wants Over Needs
In 1945, long before the overvalued disruptor archetype became so common and powerful, Abraham Maslow created his model called “Maslow’s Hierarchy of Needs”. At the time, the social contract was accepted as a part of American society and, as such, was valued and enforced…and implicit.
The pyramid that became common across generations of textbooks, wasn’t actually representative of Maslow’s message, which was that only after one need is fulfilled does the next one rise to awareness.
In the image below, the pyramid on the left is what his colleague Douglas McGregor used then he was discussing it with business leaders, which left out the nuances, caveats and complexities of Maslow’s work. In other words, he streamlined it to benefit simple business solutions/products which worked well for those focused on transactional economics.
Generally, physiological and safety needs are more easily identified and fulfilled than the more subjective ‘Love and Belonging’, ‘Esteem’, ‘Self-Actualization’ and ‘Transcendence’ noted on the pyramid on the right. Therefore, the American marketplace rapidly acclimated to this transactional pattern. The economic engine took off and hasn’t stopped since. ~ From Community to Commodity, Part 1: Understanding the Problem…Top Down Doesn’t Work
How do we unchain ALICE… and the economy?
The world outside our homes is changing faster than anyone could have imagined, and what we really need is a blueprint for a way forward, a codex for communities rooted in wisdom, and written by the people who are going to live out the story of a shared future.
Imagine, just for a moment, that instead of supporting a system of top-down predatory capitalism that benefited a select group of people & entities, we had a cooperative capitalism model that operated with a long-term vision designed to seed, root, grow and keep sustainable wealth locally. A system that valued the non-monetary keystone capitals that move us beyond making a living to making a life.
The Anti-Fragile Neighborhood Wealth Production model is designed to bring forward the hidden wealth of neighborhoods, creating an accessible, inclusive story of the future for all, no exceptions.
What we’re proposing is activating this anti-fragile property to unlock the potential for rooting and growing strong neighborhoods in which integrated economic and community development is practiced as organized collaborative action to:
Coordinate the local capacities for learning & earning, activating the potential of technology, arts, crafts, food production and funding assets;
With the mission of triggering a continual stream of commercially viable innovative products and integrated systems.
We believe this can be best accomplished by the creation of a neighborhood wealth production engine for prototyping a new SLOW Tech™ model in integrated systems in an urban neighborhood setting.. ~ Rewriting the #NeighborhoodStory, Tools of Success: The Anti-Fragile Playbook
How does ALICE activate the productive capacity of the home?
By creating a neighborhood marketplace using the 214 Alpha platform.
It’s about creating the right ‘container’ for the invisible potential, reframing the residents from placeholders to placemakers.
In November 2020, Kent Dahlgren wrote an article detailing the financial benefit of a Small Town Economic Revival and, most importantly, how to actually do it.
He selected Caddo, Oklahoma, population 994, a town that we passed through on a recent trip.
Step One: Buy Locally
Let’s see what happens when we encourage just 10% of Caddo (100 people) to “buy local.”
At first, 40 sellers offer their wares within a “buy Caddo first” marketplace, limited to citizens of Caddo, Ok.
It’s fair to assume that each sale would average about $20, and maybe these are meals, local eggs, services, or crafts.
At just 20 sales per month (5 per week), these 40 sellers could bring in about $400/mo in additional household revenue — not bad.
That could help a family prevent involuntary displacement, catch up on bills, or purchase higher-quality produce.
Added together, that’s $192,000/year in “buy local” revenue that’s kept in Caddo, because normally it’s leached away by Amazon, eBay, Walmart, Visa, etc. ~ Small Town Economic Revival: A How To
Step Two: Produce Locally
Within the prior examples, fewer than 10% of the Caddo population are sellers, and fewer than 20% are buyers, and yet: they are keeping about $550,000 a year inside the Caddo community, instead of leached away into Walmart, Amazon, etc.
What’s next?
At $50,000/year in self-funding, the community activists may choose to invest in “earn and learn” programs that teach some citizens to become food or craft producers.
By becoming a producer, a seller dramatically increases their earning potential.
Our projections suggest a 3x increase, which means that a seller could find they are not only selling to citizens of Caddo, but perhaps they’ve found a market outside the city, to those who live just outside of town. ~ Small Town Economic Revival: A How To
In March 2021, Kent Dahlgren updated the model, upgrading to a larger community and adding in the next level of economic production.
To begin we ask our customers to declare a community of a finite size, for example: 3,500 homes and about 5,000 residents. ~ Month-by-Month Financial Model
Step Three: Producers Source Locally
It’s our counsel that the community invests further into:
…more earn and learn programs that encourage a greater number of local producers AND producers sourcing their inventory from within the community.
For example, rather that purchase tomatoes from Walmart, have the makers of homemade salsa source their tomatoes from an urban gardener’s tomato patch from within the community.
The Combined Effect
What it looks like…
Next Steps
Visit the 214 Alpha website, read additional articles by Kent Dahlgren and Ruth Glendinning and, watch these videos:
Contact kent@214alpha.com for more info about how to create a marketplace in your own neighborhood.
