corruption

Sister, Can You Spare $400?

t’s time to talk about women’s economics with attitude. It’s time to laugh at what is often absurd and call out what is dangerous. By focusing on voices not typically part of mainstream man-to-man economic discourse, our Ms. Magazine series   Women Unscrewing Screwnomics   will bring you news of hopeful and practical changes and celebrate an economy waged as life—not as war.

t’s time to talk about women’s economics with attitude. It’s time to laugh at what is often absurd and call out what is dangerous. By focusing on voices not typically part of mainstream man-to-man economic discourse, our Ms. Magazine series Women Unscrewing Screwnomics will bring you news of hopeful and practical changes and celebrate an economy waged as life—not as war.

In 2008, we found out just how exciting economics can be. Over 2.5 million U.S. jobs disappeared, and a third of U.S. real estate value flew out the window. It took a decade for the U.S. median household income to pass what it had been in 2008, now just over $60,000—yet, while prices go up and threaten to go higher with Washington’s trade war, 40 percent of Americans still don’t have $400 for emergencies.

Over the past 35 years, so-called “free market” changes in the rules of our money system and tax policies have moved dollars up to those already with a surplus. If you don’t have enough savings to pay for a college degree, a car to get you to your job or a house to live in, you must borrow. Businesses and governments borrow, too—and with interest reliably doubling debt, the upward movement of our system’s pyramid scheme hoists dollars to the un-needy. This is aided by Wall Street bro-bloviation, and sometimes corruption

Interest steadfastly doubles fortunes, too. That’s the reason that we now have a record number of billionaires—2,153 worldwide, controlling piles of money estimated at $8.7 trillion.

Is this growth good news? Not when you remember that the mirror image of this class’s paper capital, the reason for its growth, is the indebtedness of the rest of us.

It’s too bad that Forbes only publishes an annual catalog of the 400 biggest fortunes. A yearly list of the 4000 biggest debtors might enlighten us more. 

Mildly named “growing inequality,” these oversized lumps of billionaire numbers in the macroeconomic world affects Main Street, where most of us women work. The finance, insurance and real estate (FIRE) sector, not real economic production, now accounts for 20 percent of the U.S. GDP, double what it was in 1947. Stock buybacks and mergers that eliminate jobs are today’s most common use of billionaire surplus. 

This ruthless bloating of the biggest is misnamed “economic efficiency”—an apt phrase only if your intentional goal is to melt permafrost and glaciers or develop Vermont’s Green Mountains into beachfront property.

But some capital is in Vermont women’s hands. Their numbers are smaller, but they are venturing into new territory with a wider purpose than fat cat profits. 

Women are new players in the realm of capital and money. Married women couldn’t inherit property, and were property themselves, until 1848, when suffragist Elizabeth Cady Stanton helped win necessary legal changes to women’s statuses. Her working-class sisters couldn’t keep her own paycheck until she won that right 158 years ago. If you think sending her money to dad or husband was nuts, until 1974—just 45 years ago—banks could refuse a woman opening a bank account without a male co-signer. Even then, women needed another law to get access to business loans

Yet women today make all the difference, says Change the Story—an alliance of the Vermont Women’s Fund, The Vermont Commission on Women, and Vermont Works for Women whose new Champions of Change campaign has already persuaded more than 140 Vermont businesses to sign on to the Vermont Equal Pay Compact pledging to improve women’s paychecks.

They also report that between 2007-2012, women started businesses at twice the rate of men’s startups. Dollar-wise their businesses are small, but even if just one in four of Vermont’s 20,786 women-owned businesses hired one additional worker, they’d create 5200 new jobs, good for the whole state’s economy. So what’s stopping them?

Small business expansion requires financing, made tighter since 2008’s crash; always it has been tightest for people of color and women. But recent studies reveal women-managed businesses make more money, so venture capital is newly seeking women out. On September 25 and 26, for instance, Vermont Innovations Commons (VIC) is hosting the third annual Vermont Investors Summit in Burlington, featuring keynote speaker Deborah Jackson, who, along with her co-founder, Andrea Turner Moffit, used her experience as an investment banker at Goldman Sachs and Citibank to create in 2015 what they call an “investors’ ecosystem.”

Their company, Plum Alley, funds women innovators and entrepreneurs “at the margins,” while also enabling women to invest in “forward-looking companies.” So far, they’ve backed startups in biotechnology, cancer immunotherapy, online marketplaces and software. Their host, Vermont Innovation Commons, calls itself a “launching pad for entrepreneurs and innovators, a nurturing partner for startup and growth firms” with a goal to create living-wage jobs and keep Vermont’s young innovators in the state. Bio-friendly terms are found on their website too, referring to Vermont’s “entrepreneurial DNA,” presumably of interest to investor ecosystems. Neither of these exists in biology, but we can hope this isn’t mere greenwashing, but a wiser way of thinking about the eco-logy in eco-nomy.  

“We’re always looking out for our companies’ best interests, aggregating capital…from angel investors and other capital funds,” Samantha Roach-Gerber, innovations director at Vermont Center for Emerging Technologies (VCET), told Ms. VCET seeks to connect Vermont’s entrepreneurs to a network of peers, coaches and capital, namely The Vermont Seed Capital Fund. It, too, uses biologic words—with seed’s living reproduction connecting the green of money to their “evergreen” fund, which means its profits are plowed back into it.

The fund’s $5.1 million in revolving venture money is relatively “tiny,” yet has funded 24 startups at $25,000-$250,000 and has leveraged more. VCET’s interest is in “high opportunity businesses,” which trend to the technological, but do include women. They also co-host winter events in Burlington called Female Founders that always sell out and spark networking. 

More grounded Vermont investments are in the hands of Janice St. Onge in Montpelier, through the Flexible Capital Fund. A certified Community Development Financial Institution, it provides risk capital for Vermont’s food system, forestry products, and renewable energy companies. So far, they’ve invested $4.4 million in 15 Vermont companies. What makes them different?  St. Onge says she’s proudest of Flex Fund’s “royalty financing,” which is based on a piece of the revenue stream, rather than a share of equity ownership. “We remain flexible with the cash flow needs of a business and… in a way that treats our borrowers as partners.”

Vermonter Janice St. Onge, back far right, is only one of the “financial activists” who met in New York with her cohort in 2019, sponsored by the  RSF Integrated Capital Fellowship program , but she and the Flexible Capital Fund are changing investment to include women and our Mother Earth. (Edith Macy)

Vermonter Janice St. Onge, back far right, is only one of the “financial activists” who met in New York with her cohort in 2019, sponsored by the RSF Integrated Capital Fellowship program, but she and the Flexible Capital Fund are changing investment to include women and our Mother Earth. (Edith Macy)

Seeking “regenerative, not extractive businesses,” the fund values social and environmental responsibility, livable wages, and diversity in ownership, governance, and management. “The fund’s own governance is diverse,” St. Onge adds. “Four of our board of managers and two of our three-member investment committee are women.” They recently added to their portfolio MammaSez, a woman-owned plant-based meal delivery company, investing $150,000.

St. Onge is also part of a new initiative, the Vermont Women’s Investors Network, which aims to close the gender gap in funding for local businesses with positive environmental and social impact. On October 1, in Stowe, Vermont, they and the Northern New England Women’s Investors Network will host Integrated Capital—an event featuring Joel Solomon, author of The Clean Money Revolution, and Deb Nelson of RSF Social Finance, a cohort that dares call themselves “financial activists.” They even speak of poverty, rumored to be of some relevance to women.