Continuing with the local theme of the Rethink Speakers Series, last night economist and author Michael Shuman spoke about opportunities to build Montgomery’s local economy by identifying “leakage.”

Leakage, in economic terms, are those goods and services that you are importing that you could provide for yourself, whether in your own household or community. The longer your money stays in the community, the more local jobs and wealth it can create.

For example, buy a local apple and the farmer takes your dollar and spends it with a local tax preparer, who uses it to buy daycare services for her kids, who may spend it at a local haridresser…  And the apple probably tastes better too.

Though he hasn’t done a leakage analysis for Montgomery, Shuman guesses that our local economy opportunity areas include tourism, food, retail, finance, and energy.

He did identify things we can do individually and as policy-makers (and we are all policy-makers–call your council person!). Consumers can choose local businesses and local businesses can build partnerships to become more competitive. We can build pension funds invested in local businesses to keep financing local. And as for planning and policy, we can identify with more certainty where our local economy is “leaking” and develop policies that are not biased against local and home-based businesses.

And that includes big tax write-offs and financial incentives for outside companies. You can watch Shuman’s talk and see what he has to say about Montgomery’s subsidy of Costco in Wheaton.