In April, Eric Klinenberg ) wrote a long piece for *The New Yorker* — “Taking On Water” — that reframed flood control as a design problem, not just an engineering problem. His thesis: the safest city isn’t the one with the biggest wall. It’s the one that can take water in. Parks that double as reservoirs. Basketball courts that double as detention basins. Sewers that get help from soil.

He walked through Copenhagen’s $1.8 billion cloudburst plan, Hoboken’s resiliency parks, and Staten Island’s Bluebelt — proof points that the “sponge city” idea, coined by Chinese landscape architect Kongjian Yuscales past the pilot-project stage into real municipal infrastructure.

What’s happened since is the part that matters for anyone doing this work: the idea kept moving, and it kept getting tested against real storms and real budgets.

**Three weeks after the piece ran, New York put money on the table.** On April 30, [Mayor Mamdani and the NYC Department of Environmental Protection announced $95 million for a cloudburst project in Homecrest, Brooklyn — porous pavement, underground storage under schoolyards and parking lots, targeting 30 million gallons of stormwater a year across a 350-acre flood zone. This isn’t a demonstration park. It’s DEP’s fourth or fifth deployment of the same playbook, following projects already running in Parkchester, Brownsville, East New York, East Harlem, and several Queens neighborhoods.

**Then came the necessary pushback.** In June, [Inside Climate News ran a piece asking whether sponge cities can handle “supercharged” storms — the kind climate change is now producing. Their answer, blunt and correct: no single method covers every case. Zhengzhou had invested billions in sponge infrastructure before 2021’s storm dropped more than a year’s worth of rain in a few days. No amount of soil and swale absorbs that. The honest read is that sponge infrastructure is a tool for the storms that are becoming *routine* — the 2-to-4-inch cloudbursts that used to be once-a-decade and now aren’t — not a substitute for hard engineering against the true outliers.

And this week, Quezon City gave us an actual outcome number.** The city’s Drainage Masterplan — detention basins under basketball courts, a retention pond inside Quezon Memorial Circle, flap gates on Araneta Creek — produced an 80% drop in monsoon evacuations this August compared to the same storm season a year ago. That’s not a design award. That’s fewer families in shelters.

Put together, that’s four months of evidence that the sponge-city method isn’t aspirational anymore. It’s operational, it’s being funded at real dollar amounts, it has an honest limit (catastrophic storms still need gray infrastructure too), and in at least one city it’s already showing up in the numbers that matter — evacuations avoided, gallons kept out of sewers, basements that stayed dry.

For anyone doing local economic and infrastructure work, the pattern underneath the pattern is familiar: the method didn’t scale because someone declared it a national strategy. It scaled because enough distinct places — Copenhagen, Hoboken, Staten Island, now Brooklyn and Quezon City — ran their own version, under their own budget constraints, and it kept working. That’s what “proven” actually looks like.

---

That’s why I’m genuinely excited to share that the leaders of DAF Commons will be joining us in Galveston this September.

Here’s the backstory, because I think it matters. DAF Commons is a project of [ImpactAssets, the $3 billion plus donor-advised fund platform that spun out of Calvert Foundation back in 2010. My old friend and longtime collaborator Tim Freundlich built ImpactAssets from the ground up, and he’s the one who made the connection for me. Tim and I go back to the earliest days of the impact investing field — we were in the room when a lot of this vocabulary was still being invented. So when he tells me something is a real signal and not just noise, I pay attention.

What DAF Commons has built is a peer network for the people running multi-donor collaborative funds — the folks figuring out how to pool donor-advised fund dollars and point them at real problems: community-owned real estate, affordable housing, climate justice. It’s a “who’s who and where are they” for a corner of the capital stack that’s been growing fast but quietly, mostly below the radar of people like me who’ve spent our careers on the catalytic philanthropy side. The leaders of these multi donor funds are often GenX women who inherited wealth and rather than trying to bend Dad’s family foundation to what the world needs now take the new and flexible route of banding with other women ready to take action at the speed of the meta crisis facing the world.

And that’s really the heart of why this matters to me. Neighborhood Economics has always been built around a simple bet: that the people repairing local economies need to be in the same room as the people with capital to deploy, and that those rooms need to keep getting bigger. For years, that’s meant foundations willing to take real risk with catalytic grants and program related investments (PRIs). DAF collaboratives are the next room to open up. There’s a serious amount of capital sitting in donor-advised funds across this country, and a lot of it is genuinely looking for exactly the kind of proven, replicable community investment tools we’ve spent a decade surfacing at these convenings.

So here’s my ask, stated plainly: if you’re a catalytic philanthropy funder, or an impact-first fund looking for new co-investors, this is a group you need to get to know. I don’t say that lightly. I’ve watched a lot of “emerging” capital pools promise a lot and deliver a little. This one feels different, and I trust Tim’s read on it.

We’ll be exploring this convergence directly in Galveston — multi-donor DAFs for community-owned real estate, and the bigger question of how catalytic philanthropy and DAF collaboratives can actually co-invest at scale, not just share a stage.

---

**Three years from now, in a home rule state**

The hospital’s boardroom had a window that looked out over the parking structure, and beyond that, if you knew where to look, a thin gray line that was the creek. The chief medical officer had worked at the regional hospital for eleven years and had never once thought about that creek as anything other than infrastructure — a thing the city managed so it didn’t flood the ER access road every spring.

She thought about it differently now.

“Walk us through the numbers again,” said the board chair, a retired grower who’d spent the first forty minutes of the meeting skeptical and the last twenty going quiet in the particular way people go quiet when a spreadsheet starts winning an argument they didn’t expect to have.

She nodded to the young researcher beside her — technically still a fellow, technically still supposed to be finishing a thesis somewhere else, and who had somehow become the person in the room who could hold both the epidemiology and the aquifer models in his head at the same time.

“Emergency department visits tied to well-water contamination and heat-related illness in the lower valley,” he said, pulling up the slide. “Cross-referenced against the aquifer drawdown maps our water rights consultant’s team built. Since the drought years, the correlation isn’t subtle. Nitrate levels track with pediatric GI admissions almost month for month. And the drawdown zones — the places where irrigation pumping has pulled the water table down more than thirty feet — those same zip codes show elevated heat-stroke admissions, because the wells that used to feed livestock troughs and shade trees have gone dry, and shade is a public health intervention nobody accounts for until it’s gone.”

The chair exhaled. “So what you’re telling me is the hospital has been treating the externality.”

“The hospital has been *subsidizing* the externality,” she said. “Every one of those admissions is a cost that never shows up on an irrigation district’s balance sheet, never shows up in a water rights transfer, never shows up anywhere except our books, where it looks like a routine increase in ED (emergency department) volume. We’ve been doing the watershed’s cost accounting for free, one patient at a time.”

---

It had started two years earlier, in an email thread nobody expected to matter. A veteran water rights consultant, who’d spent three decades doing the unglamorous work of adjudicating who owned what share of a the water rights on a river, had written to a community economics organizer with a question that seemed almost naive in its simplicity: *what if the watershed itself was the client?*

Not the irrigators. Not the city. Not the tribal nation with the oldest and most legitimate claim in the basin. The watershed. As an entity. As something that could be owed something, rather than something everyone else was owed *from*.

A national legal and organizing group with a decade of rights-of-nature work had the scaffolding — mostly symbolic ordinances, mostly struck down or preempted in states where cities couldn’t out-legislate their legislatures. But this wasn’t one of those states. This county was in a home rule state; so it had charter authority that state’s disempowered by Dillon’s Rule could only envy. A watershed health ordinance here didn’t need to win a fight against the state. It needed to win a fight in the county.

The insight that made it move, though — the thing that took it from a legal theory a few organizers were excited about to something a hospital board would sit through a ninety-minute presentation on — was the health data. Rights of nature, on its own, was a hard sell to a place whose economy still ran on senior water rights and orchard yields. Rights of nature *plus* a documented, dollar-denominated public health cost — that was something an anchor institution with a balance sheet and a community benefit obligation could actually act on.

**A year and a half later**

The summit itself was smaller than its organizers had originally imagined — eighty people in a converted grange hall outside town, not the regional convening someone had once pitched. But smaller had turned out to be right. You didn’t need three hundred people to write an ordinance. You needed the county commissioners, the tribal water office, the hospital’s community benefit director, four irrigation district managers who were tired of litigating the same allocation fights every drought year, and a room quiet enough that people could actually change their minds out loud.

The ordinance that came out of it did not declare the river a legal person, exactly — the drafting team had learned from a decade of rights-of-nature efforts that got tied up in exactly that framing fight and never got past it. Instead it did something quieter and, it turned out, more durable: it established a *watershed health baseline*, tied to specific, measurable ecological indicators — flow regime, aquifer recharge rate, nitrate load, riparian canopy cover — and required that any permitted water use or land use action demonstrate it would not push the watershed below that baseline. Below baseline, the ordinance said, was legally equivalent to below the standard of care. It borrowed the language of medicine on purpose.

And it created something new: a standing seat, on the county’s water resources board, for the hospital’s community health officer — not as a courtesy appointment, but because the ordinance explicitly recognized watershed degradation as a public health harm, and public health harms required public health expertise at the table where the decisions got made.

The chief medical officer took that seat.

---

The real test came eighteen months later, when an irrigation district wanted to expand a permit that the models said would drop the aquifer recharge rate below baseline in a drought year. Under the old rules, that fight would have been a straightforward allocation dispute — senior rights against junior rights, decided by hydrology and precedent, health nowhere in the room.

Instead, the hospital brought the ED admission data. The water rights consultant brought the drawdown model. The tribal water office brought decades of documented flow requirements for salmon that nobody in the county had ever had to weigh against a hospital’s cost curve before. And the district, to its own visible surprise, did not fight the framework. It fought the *numbers* — argued the baseline was set too conservatively, argued for a phased expansion with monitoring triggers instead of a flat denial.

They settled on the phased version. It wasn’t a rout. It wasn’t supposed to be. What it was, the consultant said afterward, standing outside the grange hall in the kind of late light that made the hills look like something out of a memory rather than a place, was the first time in his career he’d watched a water rights negotiation actually price in the thing everyone had always known was real and never had a column for.

“It works,” he said, “because nobody had to believe in rights of nature as a philosophy to sit down at that table. They just had to look at what it was already costing them not to.”

The organizer beside him was already thinking about how to describe it elsewhere — not as a legal victory, not as a health outcomes story, but as what it actually was: a different way of doing the accounting, in a place that had finally gotten tired of pretending the bill wasn’t coming due.

---

*This is a work of speculative fiction. It is intentionally unplaced and uses no real names — the watershed, town, hospital, and characters are all invented, though the underlying ideas (rights-of-nature frameworks, home rule authority, anchor-institution health data, and true-cost accounting for watersheds) draw on real ongoing conversations. This fantasy could probably not become a reality in the handful of Dillon’s Rule states. For Rights of Nature, home rule matters because local governments in home rule states generally have more room to test novel ordinances without waiting for explicit state permission. In Dillon’s Rule states, local authority is narrower, so Rights of Nature measures are more exposed to challenge unless state law clearly authorizes them.

States commonly identified as primarily Dillon’s Rule include:

• Alabama

• Delaware

• Idaho

• Nevada

• North Carolina

Next fall, Neighborhood Economics comes to Cincinnati. Before we show up with a conference agenda, we want to actually know the place — not the skyline version, the neighborhood version.

So I’ve joined Common Good Journal a new effort convened by my friend and mentor Peter Block and a small crew of journalists, connectors, and storytellers, including Rijon Erickson, investigative journalist Lorie Baker, who writes on this substack filmmaker Jim Prues, and educators Dan Joyner and Gayle Hilleke. The idea is simple and unfashionable: local news has collapsed, national narratives have swallowed local ones, and the people doing the actual work of repair in their own neighborhoods rarely get to tell their own story.

They have started in two Cincinnati neighborhoods — Westwood and North College Hill — where the group already has trust and relationships. Over six weeks, residents in each place will work through a set of questions designed to surface both the story and a measure of social capital in that neighborhood — building on the “social capital cuts the cost of financial capital” work I’ve seen firsthand, from DeAmon Harges’s Indianapolis experiments to the community-embedded insurance pools I learned about after Helene. As Peter said “The purpose of measuring social capital is to produce concrete outcomes that expand access and lower the cost of capital, and increase health, the local economy, and well being.” And we will be looking for organizations who will pay for that measured social capital; perhaps in lower fees, mortgage loan origination costs or something else we find.

The call is to explore this in partnership with Canadian economist Mark Anielski who has years of experience in measuring social capital. He is known for expanding how we measure wealth beyond gdp to include wellbeing, trust, relationships, and community strength. His work treats social capital as a real economic asset that can be mapped and measured alongside financial and physical capital.

For me, this is fieldwork. It’s the same instinct that sent me digging into the Cincinnati Children’s Hospital anchor investment in Avondale — $11 million in housing, an 18% drop in inpatient days for kids with chronic conditions, a hospital that makes more money when its neighborhood is healthy. I want more stories like that before the conference, not summarized in a briefing document, but heard from the people living them.

Children’s is playing the role of a “Community Quarterback” for the Cincinnati pilot in the NY Federal Reserves groundbreaking initiative of Making Missing Markets The community quarterback is the local backbone leader that convenes stakeholders, aligns capital and institutions, and keeps a neighborhood or regional economic strategy moving from vision to execution. In the New York Fed framing, the quarterback helps coordinate actors who would not naturally act together and reduces the friction that keeps community investment from happening. Making missing markets is the idea that some valuable community outcomes do not happen because the relationships, institutions, data, or financial structures needed for investment are absent or weak. The work is to intentionally build those conditions so capital can flow to places and projects that conventional markets overlook.

MMM is the brainchild of long time Neighborhood Economics ally and personal friend David Erickson

.

Through his work connected to the Federal Reserve and community finance, he has helped shape practical strategies for aligning local leadership, capital, and market infrastructure to unlock inclusive economic growth.

We will also be looking at the ownership economy work of Coop Cincy and its dynamic leader, Kristen Barker. Co-op Cincy builds and supports worker-owned businesses to create family-sustaining jobs, shared ownership, and a more inclusive local economy. It has been active since 2011 and focuses on growing an interconnected network of co-ops in Greater Cincinnati. (coopcincy.org)

Barker is Co-op Cincy’s co-founder and president, and she is a leader in adapting the Mondragon-inspired union co-op model in the U.S and also helping to fund the initiatives.

-

Innovation is treated as the answer to almost everything in this field. New instrument, new structure, new mechanism — that’s the story everyone wants to tell, and the one funders want to fund. Sometimes it’s the wrong answer.

When a new coalition needs its first deal to prove it’s real, the instinct is always to reach for the most innovative thing on the shelf. A signature project. A flashy, high-impact instrument that can anchor a press release and make funders feel like they’re part of something new.

The Texas Impact Capital Alliance did the opposite, and I think they got it right. Its opening move isn’t innovation. It’s a Texas-scoped fixed income instrument — still being defined, engineered specifically to be easy for any institution’s investment committee to approve without a fight. No heroics required. No one has to defend an unusual risk profile to their board. It is, on purpose, boring.

Kate Knight, who leads impact investing field-building for the [Phillips Foundation]() and co-chairs TICA with Susybelle Gosslee of the Episcopal Health Foundation (formed when they sold their hospitals0/ Knight is a former social-innovation-accelerator director from Dallas, now an institutional impact investor, and the case she makes is a quiet argument against the field’s default instinct: sometimes the most innovative thing a coalition can do is refuse to be innovative.

## The nugget: a boring bond, on purpose

Kate’s read, informed by some stumbles by sister collaboratives like https://nmic.org/ in New Mexico, Opal in Alabama, and Invest Appalachia, is that niche, highly innovative first deals have too narrow a focus, too little shared appetite, too much friction between novelty and approval. A boring, swappable, low-risk instrument gets everyone in the room actually transacting instead of admiring the idea of transacting.

Generating the shared liquidity that impact investing alliance needs is not about the excitement of the first deal — it’s about starting the transaction flow, getting the money between the players moving, turning the water wheel. The interesting deals come later, once the muscle memory exists. Ordinary, in other words, isn’t the absence of strategy. Here, it *is* the strategy.

Importantly, TICA itself won’t be the fund. It’s a facilitator that will engage an outside fund manager and support the administrative costs of getting deals built — not the investment vehicle itself. Even the coalition’s structure is doing the unglamorous work of staying out of the way.

## Born at the Fed, not in a boardroom

TICA didn’t start as a strategic plan. It started as an impact investing bootcamp hosted by the Federal Reserve Bank of Dallas originally aimed at a narrower question: could impact investing help fund broadband access in rural Texas? Enough people showed up asking “wait, what *is* impact investing” that the series became a year-long convening. Kate walked into the first session, looked around the room, and realized she didn’t recognize almost anyone — despite thinking she knew everyone doing this work in Dallas. That gap turned out to be the opportunity. The Fed team decided to build on the momentum and asked Kate — entrepreneurial, unafraid to say what she thinks, fast-moving — to run it. Susybelle, who brought governance instincts to balance Kate’s speed, became her co-chair. Kate calls it a “less talk, more rock” partnership. Someone in Texas, inevitably, reframed that as “more cattle, less hat.”

The steering committee they’ve assembled since is deliberately broad: bankers, community and family foundations, health foundations, Microsoft representing corporate capital, and geographic spread across a state where, as Kate put it, someone in El Paso often has no idea what’s happening in Houston. TICA’s founding bet is that the connective tissue itself — the awareness, the relationships, the shared infrastructure — is worth building before any single deal gets done. The boring bond is the first test of whether that tissue actually holds weight.

## The CDFI desert underneath it all

One thread that surfaced almost as an aside carries real weight: Texas, by Kate’s account, is a CDFI desert. North Texas in particular has only a handful of community development financial institutions serving a state its size. No CDFI has an office in Galveston, though it’s served by one in Houston. That scarcity is what originally drove Kate to propose a Southern Dallas Guarantee Fund — a smaller, localized cousin of the national Community Investment Guarantee Pool, aimed at closing the well-documented lending gap between businesses north and south of I-30 in Dallas. Three years into that effort, buy-in from CDFIs has been hard-won — a reminder that even good guarantee mechanics can’t outrun the underlying scarcity of institutions to guarantee. It’s the same lesson as the bond, from the other direction: you can’t innovate your way around a missing foundation. You have to build the foundation first, even when that’s the less interesting job.

## What three and five years look like

Kate’s own horizon: within three years, active co-investment actually happening across the state, not just aligned language about it. Within five, she wants robust deal-sharing to be normal — and, maybe most tellingly, she’ll count the first fully co-invested deal, everyone holding hands and doing it together, as a milestone bigger than the dollar amount attached to it. That’s the real signal in a young ecosystem: not the size of the first check, but whether disparate capital sources can act in concert at all. The boring bond isn’t the destination. It’s the practice run for trust.

## Where this connects to Galveston

TICA members will get a look at Neighborhood Economics’ capital stack in Galveston this September — community-owned commercial real estate, entrepreneurship funds, workforce housing vehicles, and multi-donor collaboratives, all potential co-investment partners for whatever TICA’s first vehicle becomes. They’re inviting their members to a TICA breakfast on September 16 at the conference. Helping strangers discover how they can become unlikely allies is what our conferences are all about, and we welcome them.

If there’s a bigger point here, it’s this: the impact investing field spends a lot of energy chasing the next clever instrument. TICA’s opening move is a quiet argument that the actual scarce resource isn’t cleverness. It’s the boring, repeatable, low-drama transaction that lets strangers become collaborators — the thing ordinary enough that nobody has to be a hero to say yes.

---

A friend sent me Jen Pahlka’s new Substack piece and pushed back on something I’ve been saying: that anchor hospitals are genuinely new and good. His doubt, boiled down, is that “hospital” is just another word for the old, extractive health care system — and no amount of relabeling changes what the word means to him. Pahlka’s piece gives his skepticism some intellectual cover: her argument that “horizon 2” interventions can quietly reinforce “horizon 1” instead of moving past it is a real risk. Pour more money into a traditional-looking institution and you may just be feeding the thing you meant to replace.

I can’t alter anyone’s instinctive bias that the word *hospital* means shit, which he said repeatedly. I won’t try. But I can point at what’s actually different, because the flaw in his argument is the word *traditional*. It assumes the institution is the system. It isn’t. The system is the incentive structure the institution answers to — who owns the asset, who profits when it grows, and what “success” is measured against. Change that, and you change what the institution does, even while it keeps the same name, the same building, the same word — hospital — that carries all his suspicion.

Buckminster Fuller had a name for this kind of leverage point: the trim tab. On a large ship, the rudder is too big to turn easily against the water pressure — but attached to the rudder’s trailing edge is a tiny trim tab. Turn the trim tab a few degrees, and it shifts water flow just enough to push the whole rudder around, which turns the whole ship. Fuller’s point was that you don’t need to move the entire mass of a system to change its direction. You need to find the small, precisely placed thing that changes the flow around it — the strategic point where a modest input triggers a phase change in the whole.

An incentive is exactly that kind of trim tab. You don’t have to rebuild the hospital, the bank, or the insurer from scratch. You change who owns the assets and what the institution is rewarded for, and the whole system’s behavior reorganizes around the new flow. That’s not incremental tinkering at the edges — it’s the strategic point that causes transformation, precisely because incentives are what everything else in the institution orients around.

Look closely at what the trim tab actually does in each of these three cases, and it’s the same move every time: it creates a commons — a pooled, shared resource sitting inside the financial vehicle, owned by the people it serves rather than by shareholders extracting value from them. The pooled premiums in community-embedded insurance are owned by the community that pays into them. It’s a solution more communities are moving to in a post climate disaster America, when for profit insurers are not interested or charge too much. The deposits in a public bank are owned by the public — in North Dakota’s case, literally by the state. And that iconic and lone example may have company soon; San Francisco is voting in November to create one, and nine of 11 supervisors are supporters, and Los Angeles will have a similar vote in a few months.

And the community health that an anchor hospital produces in a neighborhood like Cincinnati’s Avondale is a commons too: a shared asset that accrues to everyone who lives there, measurable in something as concrete as reduced inpatient days. Different financial vehicles, same underlying move — take a pool of value that used to be extracted upward and make it a commons held by the community that generated it. The hospital makes more money if the community is healthier and they’ve invested $11 million into housing in the neighborhood in the last five years and inpatient days are down 18%; a clear measure of a healthier community they helped create.

Anchor hospitals aren’t the only place this is happening. Public banking and community-embedded insurance are running the same play in finance and risk. Look at all three side by side and the pattern is obvious: bigness is still a virtue, but the use of the assets has changed, and so has how the institution acts.

Bigness is still a virtue. Scale still matters. What’s changing is *who the assets serve* and *what winning looks like*. Here are three examples working right now.

## 1. Public banks: owned by the public, accountable to the public

A public bank’s assets belong to the public, not to shareholders looking for quarterly return. That single ownership fact is the trim tab: it rewires the incentive so the bank’s job becomes financing what the community needs — infrastructure, small business, affordable housing — rather than what maximizes shareholder value. In the Bank of North Dakota, the founding model for all of this, the deposits themselves are the commons: they’re owned by the state of North Dakota, not by private shareholders, which is precisely why the bank can be chartered to serve the state’s economic development rather than to return dividends to investors. Academic researchers who’ve built the most comprehensive global count put the number at more than 900 public banks worldwide, with combined assets nearing $49 trillion. A narrower count focused specifically on public *development* banks — the AFD’s first global database — found 450 public development banks on every continent, holding over $11 trillion in total assets.. Either way, this isn’t a fringe experiment. It’s a massive, underreported layer of the global financial system already operating on different incentives than commercial banking.

Rugged individualism thinking is the core mindset that has kept public banks from proliferating in this country. Climate change, which requires a collective local response, as we discovered in Swannanoa, North Carolina, when we were the epicener of Hurricane Helene, is only one of the drivers that is making the value of the commons more clear to everyone. That’s also why publicly owned grocery stores, seen more visibly in New York City, but also highly successful in a deep southern city like Atlanta are growing. I’ve written here about how community owned commercial real estate is another commons next to high street; a commons that thrives next to the market.

## 2. Community-embedded insurance: premiums that stay local

For-profit insurers are pulling out of disaster-prone communities because the incentive is to avoid risk, not absorb it. Community-embedded insurance turns the trim tab the other way. As the nonprofit InnSure describes it, the model integrates a policy into a specific community or group through a third party, like a local government or homeowners’ association, so premiums are pooled and held by the people paying them. That pooled premium is the commons: it’s owned by the community itself rather than passed up to a distant insurer’s shareholders, which is what lets it be redeployed locally instead of extracted. InnSure’s pilots make the incentive shift concrete: in Salem, Massachusetts, the QBE North America Foundation is funding a pilot that pairs home resilience audits with a community-embedded insurance solution designed to reward climate adaptation at both the household and community level— meaning the community that mitigates its own risk captures the financial benefit of doing so. An earlier InnSure pilot in New York extended rainfall coverage to the city’s most socially vulnerable resident, in a market segment traditional carriers had written off. Same instrument — insurance — different owner of the incentive to reduce risk.

## 3. Anchor hospitals: paid to keep you healthy, not to treat you sick

This is the example my friend can’t get past, so it’s worth the most space. The traditional health care system genuinely does make more money the more you pay for medicine and treatment — that’s the incentive he’s reacting to, and he’s right to react to it. But an anchor hospital’s business model and goals are different from a standard health system’s, and that difference isn’t cosmetic — it’s structural, and it’s been running for nearly a decade at real scale.

Founded in 2017 by 30 U.S. health systems, the Healthcare Anchor Network (HAN) now comprises more than 600 hospitals with a million employees, $50 billion in annual spending on goods and services, and $150 billion in investment assets</cite> being deliberately redirected toward community outcomes rather than pure yield. By 2022 that had grown to more than 65 members with over 1,000 hospitals employing more than 2 million people, purchasing over $75 billion annually, with over $150 billion in invested assets— and member systems pledge at least 1 percent or $50 million, whichever is less, of long-term reserves toward place-based impact investments deployed within five years</cite>. Today HAN counts more than 70 hospitals and health systems as members, including one — a network of 75 hospitals in the anchor collaborative — that we’ll work with directly when we run a conference in Cincinnati next fall.

Here’s the trim tab, in a sentence: as a place-based investor, a hospital dedicates a portion of its investments to local projects addressing the root causes of poor health, generating measurable social and health impact alongside a modest financial return. A standard health system’s portfolio is judged on yield alone. An anchor hospital’s portfolio is judged partly on whether the community around it gets healthier — and if people are healthier, they cost the system less, which is the opposite of a business model that profits from treatment volume. That single change in what the investment pool is rewarded for is small relative to the $150 billion it’s attached to, but it’s positioned exactly where Fuller’s trim tab sits: at the point where a modest turn redirects the whole institution’s flow.

And the commons this produces is community health itself — a shared, pooled literally living asset held by everyone in the neighborhood rather than captured by any single payer. Cincinnati Children’s, an anchor hospital sitting in the Avondale neighborhood since 1926, gives one of the clearest numbers I’ve found for what that commons looks like in practice. Researchers there set out in 2015 to reduce the inpatient bed-day rate for children from Avondale and Price Hill by at least 10 percent by June 2020, working across chronic disease management, care transitions, mitigation of social risk, and real-time data sharing with community partners.

By the end of the study period, the inpatient bed-day rate for the two target neighborhoods had decreased by 18 percent from baseline, and hospitalizations decreased by 20 percent. That’s not a marketing metric — it’s kids not needing a hospital bed, measured directly against a neighborhood baseline where children had been collectively spending about 75 days each month and 900 days each year on inpatient units before the improvement effort began. Fewer inpatient days is a pooled community gain in the same way pooled premiums or public deposits are: value that stays with the people who generated it instead of flowing out as billed treatment.

Concretely, that’s shown up as affordable housing investment (Kaiser Permanente, Allina Health), local hiring and supply-chain pipelines, and initiatives like Intermountain Health’s partnership with Evergreen Cooperative Laundry, which restored local laundry jobs while supplying regional health systems.

None of this erases the real, ongoing problems with big medicine — rural hospital closures, health care deserts, a payment system still weighted toward volume over outcomes. The devolution of care to local delivery is happening *because* of those failures, and it’s a good thing, but it doesn’t mean hospitals stop being needed — it means they’re needed to fill the gap left by the hospitals that closed. The anchor mission isn’t defending the old system. It’s using the hospital’s scale — its workforce, its purchasing power, its investment pool — as leverage against the old system’s own logic. That’s what makes it new, and it’s why “hospital” doesn’t have to mean what my friend thinks it means.

## The through-line

In all three cases, the asset didn’t shrink. The ownership and the measure of success changed — and what got created inside each financial vehicle was a commons: pooled insurance premiums owned by the community, deposits owned by the state of North Dakota, community health in Avondale owned by the neighborhood and measured in inpatient days that didn’t happen.

That’s the trim tab logic: you don’t need to rebuild the whole ship to change its direction; you need the small, precisely placed input that shifts the flow around it, and the mass of the institution turns with it. That’s not “supporting the old system” — it’s the actual mechanism by which large institutions get repurposed. Deep system change rarely starts by tearing down the big buildings. It starts by rewriting what the people who run them are rewarded for, and by pooling what used to be extracted so it stays with the people who generated it.

So when my friend looks at an anchor hospital and sees the same word, the same campus, the same white coats, I understand the doubt. But the thing underneath the word has changed. That’s not a defense of the old system. It’s the difference between it and the new one — and it’s a small enough turn that it’s easy to miss, right up until the whole ship comes around.

There’s a version of the hospital business that most people assume: staff the ER for gunshot wounds and heart attacks, admit the sick, discharge the well, bill insurance. Community development is what foundations and city hall do, not what a hospital does.

That assumption is wrong, and the person who did the math to prove it is [Tyler Norris]), who created the concept of hospitals as anchor institutions focused on creating community health while at Kaiser Permanente and later led Well Being Trust. His starting observation, delivered at a Philadelphia Fed panel on anchor institutions, was blunt: [as much as 18 percent of U.S. GDP goes to health care, and 80 percent of that spending addresses chronic illness — diabetes, obesity, heart disease — meaning most of it could instead go toward the economic, social, and environmental conditions that cause those diseases in the first place](## The ER math

Hospitals are legally required to staff emergency departments for trauma — gunshot wounds, heart attacks, strokes. That’s fixed cost, non-negotiable. But a large share of ER *volume* isn’t trauma. It’s chronic disease patients cycling back five or six times a year — a diabetic in crisis, someone with PTSD in acute distress — because the underlying condition never gets treated, only the flare-up. It costs ER‘S $10,000 to $15,000 per visit even for those chronic cases.

Kaiser’s own integrated-care research backs this up directly: [ER physicians can flag high-risk patients with chronic diseases who are frequent utilizers, and route them through case managers into more intensive outpatient programs with tighter primary-care follow-up](). Norris’s version of that insight was a cost comparison: if a satellite clinic addressing diet, exercise, and behavioral health costs $50,000 to build and run per patient, and that same patient was already costing the hospital $50,000+ a year in repeat ER visits, funding the clinic isn’t charity. It’s cost containment. A hospital’s fiduciary duty to control costs *requires* it.

## Then procurement

Once you accept that a healthier surrounding community is cheaper to serve, the next lever isn’t care delivery — it’s spend. Hospitals already purchase enormous volumes of food, laundry, and supplies. The anchor model asks: instead of buying from whoever’s cheapest nationally, what if some of that spend went to regional, community-rooted suppliers? A more economically stable local farming community means less precarity-driven chronic illness and lower long-term utilization. Norris described this as [deploying all of an institution’s clinical and non-clinical assets — hiring, purchasing, investing — in service of the same mission that already drives clinical care](https://stakeholderhealth.org/tyler-norris/).

## Cleveland scales it into ownership

The [Healthcare Anchor Network — [now a collaboration of more than 75 health systems](https://healthcareanchor.network/) built on this logic — traces its roots to Cleveland, where Cleveland Clinic and University Hospitals anchored the Evergreen Cooperatives: worker-owned laundry and greenhouse businesses built specifically to win hospital contracts. That took “buy local” and turned it into permanent, community-owned job infrastructure with a revolving fund behind it — not a one-time grant, but a durable business relationship.

## Rush and the move to place-based investment

The current frontier is capital allocation, not just spend. HAN’s president, David Zuckerman, frames the whole model as health systems leveraging hiring, purchasing, *and investing* to build communities where people can be healthy](/) — and Rush University System for Health’s West Side investment in a neighborhood grocery store, gardens, and a composting operation that turns hospital waste into a climate-resilience asset is that logic matured one step further: from *how we spend* to *where we put capital*.

## The reframe

The question isn’t whether hospitals should get into community development. It’s that hospitals are already the largest, least-mobile economic actor in most communities — they can’t relocate, and they’re going to spend billions in payroll, purchasing, and investment regardless of strategy. The only real choice is whether that spend happens accidentally, wherever’s cheapest this quarter, or strategically, in a way that reduces the downstream demand for expensive acute care. That’s not mission creep. That’s a hospital finally accounting for costs it was already carrying but never managing.

## This isn’t a fringe idea anymore — it’s an adoption gap

The model is proven. Dozens of health systems have already run this playbook, from Kaiser’s outpatient chronic-care clinics to Cleveland’s worker-owned cooperatives to Rush’s neighborhood investment in grocery, gardens, and composting. The question left on the table isn’t whether it works — it’s how many more hospitals will do it, and how fast.

That’s where communities come in. An anchor mission isn’t something a hospital adopts on its own initiative most of the time — it’s something local coalitions, city leaders, and organizers have to ask for, push for, and hold the institution accountable to. If your city has a hospital or health system that’s already a Healthcare Anchor Network member, that’s not a footnote — it’s leverage. The commitment is already on paper. The job now is turning it into a concrete local strategy: procurement dollars redirected to local and minority-owned suppliers, satellite clinics in the neighborhoods driving the highest ER utilization, investment capital aimed at the housing and food infrastructure that keeps people healthy in the first place.

We’re planning to make this a focused track at an upcoming Neighborhood Economics conference in a city that’s invited us to come — one with an HAN member hospital already in place. We want to ask them to look with us at how their work on community health can be the anchor to heal the neighborhood economy in the zip codes where people die ten years younger than in more affluent parts of town. . The opportunity isn’t starting from zero. It’s holding an existing anchor accountable to become the kind of anchor its own network says it can be or asking your hospital to join the network and become an anchor for a healthy community.

---

There’s a particular moment in building any new field of practice when a room full of well-meaning people who all say the word “impact investing” realize they’ve never actually watched each other invest. Texas recently that moment, and a former social-innovation-accelerator director turned institutional impact investor from Dallas named Kate Knight decided somebody needed to do something about it. Knight had done it; many of the people in the room were still talking about it.

I got on a call recently with Knight who leads impact investing field-building for the [Phillips Foundation, and my colleague Braxton Martorano, to talk about the Texas Impact Capital Alliance TICA— a statewide collaborative she co-chairs with Susybelle Gossleeof the Episcopal Health Foundation. It’s a young effort, still in its building phase, but it’sd grappling with exactly the question I’ve spent a career circling: how do you move a room from talking about capital to actually deploying it, together, in a place?

## Born at the Fed, not in a boardroom

TICA didn’t start as a strategic plan. It started as an impact investing bootcamp hosted by the Federal Reserve Bank of Dallas, originally aimed at a narrower question: could impact investing help fund broadband access in rural Texas? Enough people showed up asking “wait, what *is* impact investing” that the series became a year-long convening. Kate walked into the first session, looked around the room, and realized she didn’t recognize almost anyone — despite thinking she knew everyone doing this work in Dallas. That gap, it turned out, was the opportunity. The Fed team decided to build on the momentum, and asked Kate — entrepreneurial, unafraid to say what she thinks or move fast — to run it. Susybelle, who brought governance instincts to balance Kate’s speed, became her co-chair. Kate calls it a “less talk, more rock” partnership. Someone in Texas, inevitably, reframed that as “more cattle, less hat.”

The steering committee they’ve assembled since is deliberately broad: bankers, community and family foundations, health foundations, Microsoft representing corporate capital, and geographic representation across a state where, as Kate put it, someone in El Paso often has no idea what’s happening in Houston. TICA’s founding bet is that the connective tissue itself — the awareness, the relationships, the shared infrastructure — is worth building before any single deal gets done.

## Starting where the water wheel can turn

The design choice I found most interesting is where TICA is choosing to start: not with a flashy, high-impact deal, but with something almost boring on purpose — a Texas-scoped fixed income instrument, still being defined, engineered to be easy for any institution’s investment committee to approve without a fight. Kate’s read, informed by conversations with sister collaboratives like NMIC in New Mexico, Opal in Alabama, and Invest Appalachia, is that niche, highly innovative first deals are what killed a previous Dallas impact investing network — too narrow a focus, too little shared appetite. A boring, swappable, low-risk instrument gets everyone in the room actually transacting. As I said on the call, it’s not about the excitement of the first deal — it’s about starting the transaction flow, getting liquidity moving, turning the water wheel. The interesting deals come later, once the muscle memory exists.

Importantly, TICA itself won’t be the fund. It’s a facilitator that will engage an outside fund manager and support the administrative costs of getting deals built — not the investment vehicle itself.

## The CDFI desert underneath it all

One thread that surfaced almost as an aside carries real weight: Texas, by Kate’s account, is a CDFI desert — North Texas in particular has only a handful of community development financial institutions serving a state its size. No CDFI has an office in Galveston, though it’s served by one in Houston. That scarcity is what originally drove her to propose a Southern Dallas Guarantee Fund, a smaller, localized cousin of the national Community Investment Guarantee Pool,aimed at closing the well-documented lending gap between businesses north and south of I-30 in Dallas. Three years into that effort, buy-in from CDFIs has been hard-won — a reminder that even good guarantee mechanics can’t outrun the underlying scarcity of institutions to guarantee.

## What three and five years look like

Kate’s own horizon: within three years, active co-investment actually happening across the state, not just aligned language about it. Within five, she wants robust deal-sharing to be normal, and — maybe most tellingly — she’ll count the first fully co-invested deal, everyone holding hands and doing it together, as a milestone bigger than the dollar amount attached to it. That’s the real signal in a young ecosystem: not the size of the first check, but whether disparate capital sources can act in concert at all.

## Where this connects to Galveston

TICA members will get a look at Neighborhood Economics’ capital stack in Galveston this September — community-owned commercial real estate, entrepreneurship funds, workforce housing vehicles, and multi-donor collaboratives, all potential co-investment partners for whatever TICA’s first vehicle becomes. They are inviting their members to a TICA breakfast on September 16 at the conference. Helping strangers discover how they can become unlikely allies is what our conferences are all about and we welcome them.

---

Temple Grandin never set out to build a theory of animal behavior. She built chutes.

She noticed that cattle spook at a shadow crossing the ground, at a chain swinging, at a shiny reflection on wet concrete, at a coat hung on a fence — things no verbal-thinking engineer would ever think to control for, because they don’t register as variables in a theory. Grandin thought in pictures, not abstractions, and that was precisely her advantage. She could see what actually made an animal balk, walk the facility from the cow’s eye level, and redesign the physical world around what she noticed. Half the cattle-handling facilities in North America now run on curves she drew because a straight chute panics an animal and a curved one, where it can’t see what’s ahead until it’s already walking into it, doesn’t.

I want to tell you something true about myself before we go any further into this book: I am not a theorist. I’m Kevin, and I do pattern recognition. Temple and I have a similar neurodivergence here; theories are often incomprehensible to us, but we can assemble a mosaic from watching what works and what doesn’t. Rosa Lee and I have spent forty years building things — a catfish trade journal, a legislative monitoring service before the internet made that obvious, SOCAP, and now Neighborhood Economics — and in none of it did I start from a framework and apply it downward. I started by watching what worked, in which specific place, built by which specific people, and asking why it didn’t work three counties over with the same policy on paper.

That’s the whole difference between this book and a lot of good books that are coming out right now making the intellectual case against neoliberalism. Some very smart people — economists, political scientists, complexity theorists — are doing important work right now building a new theoretical paradigm to replace the one that broke. I read it. I use it. Some of it gives me language for things I already knew in my hands but couldn’t yet say out loud. But that’s not my job, and it’s not this book’s job. Their job is the theory of why the old chute panics the cattle. My job — our job, the people in this book — is walking the yard, watching where the animal actually balks, and building the curve.

## Why here and not there

Here is the pattern I keep running into, project after project, city after city: the same policy, the same instrument, the same capital stack — a Diversified Community Investment Fund, a Community Investment Trust, a Buy Back the Block campaign to bring commercial real estate back into neighborhood hands — works in one place and stalls in another that looks, on paper, nearly identical. Same demographics. Same poverty numbers. Same absentee-owned commercial corridor. One place, it takes off. Three counties over, it never gets off the ground.

The theorists will tell you it’s about “institutions” or “social capital” or “path dependence,” and they’re not wrong. But those words are still one layer removed from what I actually see, which is: *this* particular county assessor and *this* particular credit union president had lunch together twice a month for a decade before anybody wrote a grant proposal. *This* church had already been quietly buying up parcels for fifteen years because a pastor decided in 1996 that displacement was a theological problem, not just an economic one. *This* town still had a Farmers Land Trust structure sitting dormant from an entirely different fight in the 1970s, and somebody remembered it was there. It’s never the policy. It’s the terrain the policy lands on, and the people who already showed up before anyone called it a strategy.

I call this the Forensic Ecosystem Method, and it isn’t really a method so much as a checklist for what I go looking for at the scene of something that worked. There’s always a System Entrepreneur who can see the whole board. There’s a Mother Hen who holds relationships together when the money gets tense. There’s a Finance Wizard willing to structure a deal nobody’s structured before. A Connected Evangelist who can get the doubters into a room. Sometimes a Prophet, telling an uncomfortable truth years before anyone’s ready to hear it. An Anchor Institution — a hospital, a university, a diocese — with enough balance sheet to take a first loss position. And Organized Activists, without whom none of the rest of it holds, because power concedes nothing on its own.

Take all seven of those away, in any combination, and the identical policy dies quietly in a filing cabinet.

## What this book actually is

This book is not going to give you a unified theory of why the American economy stopped working for most of the people living inside it. Other people are writing that book right now, and some of them are writing it well. Market Humanism, a new manifesto and plan I read this morning is a good one. Well thought out. That is not what our book will be.

What we’re going to give you is the field notes — Orange County, North Carolina, where a property tax reassessment became a justice fight because a specific set of people decided it should be. Cook County, Illinois, doing something similar at a different scale. A Community Investment Trust in Portland that let a laundromat worker buy equity in her own building’s redevelopment for as little as $10 a month, because Mercy Corps NW built the legal scaffolding to make that possible, and a very particular assessor’s office was willing to work with them. A commercial corridor bought back parcel by parcel, block by block, because a Buy Back the Block campaign had, in that specific place, an anchor, a financier, and an organizer who all trusted each other before the deal ever got structured.

We are going to tell you where it worked, who showed up to make it happen, and what was already lying around in that particular terrain — the social infrastructure, the social capital, the fifteen years of quiet relationship-building nobody put in a pitch deck — that let it take root. And we’re going to be honest about the places three counties over where the same good idea died, and try to tell you why.

Because here is the thing nobody says out loud enough: the neighborhoods where people are dying ten years younger than people twenty minutes away are not lacking in policy ideas. They are not lacking in capital, exactly, either — plenty of capital is looking for a home. What they are usually lacking is the terrain, and the people who show up on it. You cannot legislate that into existence. But you can learn to recognize it when it’s forming, get out of its way, and — sometimes — help build the curve instead of the straight chute that makes everybody bolt.

That’s the book. Not a new theory of the economy. A field guide to what actually moves, what creates economic justice and why, and where.

We’ve spent years at Neighborhood Economics building the redlining conversation into our programming — the maps, the covenants, the deliberate disinvestment and the federally mandated program to disenfranchise Black Americans. That story is essential and still under-told. But there’s a companion story that’s older, more legally foundational, and arguably still doing more damage to community wealth-building today: zoning.

This November marks the 100th anniversary of Village of Euclid v. Ambler Realty Co., the 1926 Supreme Court decision that gave comprehensive zoning its constitutional footing. Aaron Lubeck,a Durham-based designer and builder with [The Rocket Shop and founding faculty member of the Incremental Development Alliance /), just published a sharp centennial essay on it in Southern Urbanism, and it’s worth reading in full — I’ll credit and link everything below. But I want to pull out why this matters for the work we’re doing at Buy Back the Block, DCIFs, and community-owned real estate, and why I think it belongs on our 2027 agenda.

### The short version of Euclid

A Cleveland suburb zoned 68 acres owned by Ambler Realty — land with obvious industrial and commercial potential along a rail line — into residential-only use, gutting its value. Ambler sued, arguing this was an uncompensated taking. A federal district court agreed. The Supreme Court reversed, 6-3, on November 22, 1926, in an opinion by Justice George Sutherland that set the standard courts still use: zoning is valid as long as its reasonableness is “fairly debatable.” Sutherland’s opinion is also where the infamous line comes from calling apartment buildings a “mere parasite” on single-family neighborhoods — language that, as Lubeck notes, still echoes in how courts and localities treat multifamily housing as a nuisance to be zoned away from “good” neighborhoods.

Ambler’s lawyer was Newton D. Baker, a former Secretary of War and Cleveland mayor. His argument wasn’t just about Ambler’s balance sheet — he’d separately represented what’s now Bellefaire JCB a Jewish children’s home whose building plan had been blocked by a local zoning committee explicitly because officials didn’t want a large number of Jewish children in the village. Baker saw discretionary land-use power as a standing invitation to prejudice, and warned — accurately, in hindsight — that zoning ordinances would go obsolete within a few years of passage while still trapping private owners in outdated rules. Historian Michael Allan Wolf has documented Baker’s fuller critique if you want the primary sourcing.

### Why this belongs next to redlining, not instead of it

Redlining (1930s federal Home Owners Loan Corporation maps) and racial covenants struck down in Shelley v. Kraemer*](1948) get most of the attention in community economic development circles, and rightly so — they’re the most explicit, most documented instruments of exclusion. But Euclid is the legal chassis that made single-use, low-density zoning the unquestioned default nationwide, and it’s still standing. Redlining was formally repudiated decades ago. Euclid wasn’t. It’s the reason “neighborhood character,” “traffic impact,” and “infrastructure capacity” can still function today — technocratically, race-neutrally on paper — to block the exact kind of multifamily infill, ADUs, and community-owned mixed-use development that our Buy Back the Block and DCIF work, financial innovations that democratize the ownership of commercial real estate assets depends on.

Put differently: redlining explains who was locked out of capital. Euclid explains why, even when the capital shows up now — through a DCIF, a community land trust, a Community Investment Trust — the zoning code often still won’t let a neighborhood build the density it needs to make the deal pencil or to house the people it’s meant to serve.

### The conference angle

I’d like to see us build a track in 2027 — that puts zoning reform practitioners in the same room as our DCIF and anti-displacement fund people. Property-rights reformers, YIMBY-adjacent housing advocates, and community ownership advocates don’t talk to each other nearly enough, and there’s real common cause: both camps want land use decisions to stop being a “ministerial monopoly,” in Lubeck’s phrase, that entrenches whoever already owns. Ministerial is a legal term for an act carried out mechanically, by fixed rule, with no real exercise of judgment or discretion — the opposite of a “discretionary” act. A clerk stamping a form is performing a ministerial act; a judge weighing evidence is exercising discretion. Structural injustice is based on acts being carried out by fixed rules. Subverting redlining and exclusive zoning is working to change the rules. It’s justice creeping in at the level of the legal kernel of the operating system.

More soon,

---

Tuesday night of last week I showed up at the Bee Tree precinct to plan for canvassing — more than twenty volunteers, mostly retirees, a couple in matching windbreakers who’ve been doing this faithfully for a decade. They, and now we, since I’ve joined, greet new residents and freshly registered voters around Swannanoa. Some of them are with us politically. A lot of them aren’t. We talk to all of them anyway, and before we leave I plan to hand them a flyer for Swannanoa Communities Together], the nonprofit doing the best direct relief work in our valley since Helene — no politics attached, just: here’s who to call if you need help or you want to give to the people who are helping well.

I like canvassing, knocking on strangers doors and talking to people who I would never meet otherwise. I did it for Obama and it was fun and a group of guys stayed connected for a year afterward, going to an action movie once a month. I did it for Hilary, and you got a clipboard in a windowless room and handed it back to someone who didnt have time to talk.

I want to explain why I do it that way, because a friend of mine — sharp, deeply committed, and someone I respect — recently told me she despises moderates and writes off anyone willing to work with Republicans because she thinks they are all extremists and not worth the time. I think that instinct is understandable and, I’d argue, tactically backwards. Here’s the case, built from my own history, from network science, and from a book on persuasion I just picked up.

## The lesson I should have learned twenty years earlier

In 2003, I was doing on-the-ground under cover reporting trying to help get the [first openly gay Episcopal bishop Gene Robinson elected. I sat in a meeting where the group that opposed ordaining women found itself negotiating with the group that opposed ordaining gay clergy. They didn’t agree on everything — nine points, and they only agreed on six — but they signed anyway, making common cause on the four they shared. Meanwhile, our side needed to broaden a coalition that had become, by its own admission, too white. We reached out to the Episcopal urban caucus and got an ally: a Black woman, over six feet tall, sharp as anything — who was also pro-life. The room decided they couldn’t work with her over that single position. She left in tears. We lost her and that group as allies.

One side ran fighting for exclusion using single-issue partnerships to grow beyond their group’s boundaries. We ran for inclusion using a litmus test to filter out those who were not total true believers, across the board. It was a purity test. I watched both play out in real time, and I’ve never forgotten which one built power and which one shrank it. We won the election because we had a majority but they punched far above their weight because they were more welcoming and less pure in their stance of who’s inside your tent.

## The math behind why that happens

That reminded me of what I learned from Albert-László Barabási’s *Linked, which is actually about network science, not politics — but the mechanism maps almost exactly onto what I watched happen. In real-world networks, growth compounds when new members can attach on low-friction terms: one shared interest is enough to form a connection. Networks that demand a full checklist before anyone can join don’t compound — they add one fully-vetted member at a time. His network science documented how Right to life‘s universe of website partners grew exponentially while Freedom of Choice grew only arithmetically because they would not link to sites that did not sign onto their list of required issues beyond the single issue.

That’s the structural version of what I saw in 2003. The single-issue coalition around the restricting the priest hood to straight people grew far stronger because the bar to join was one point of agreement. The pro-gay coalition, in trying to hold a full checklist of positions, capped its own growth. It’s not a metaphor — it’s closer to a load-bearing wall. Purity doesn’t just feel narrower. It is structurally narrower.

## What the persuasion research adds

A friend pointed me to David McRaney’s How Minds Change which spends real time on the deep canvassing research — the door-to-door conversations that shifted views on gay marriage not through argument, but through staying in relationship with someone past the point of disagreement: listening, asking questions, not walking away the moment you learn where they stand.

That’s the Bee Tree method, basically. Nobody there treats “not one of us yet” as a reason to leave the porch. And it’s the exact opposite of what a litmus test does: a litmus test ends the conversation at the first disqualifying answer, which means it forecloses the only mechanism — sustained, respectful contact — that actually changes anyone’s mind.

## Where this gets real stakes: Jamie Ager

This isn’t abstract for us right now. Jamie Ager]is running to flip a Republican-held congressional seat in our district, and he’s said he’ll work across the aisle with Republicans on mountain issues — water rights, land use, zoning — where Raleigh’s reach into our region is the shared threat, regardless of party. My friend’s response was to write off anyone willing to do that as an extremist not worth talking to.

But Jamie isn’t running in a safe seat where purity is free. He’s trying to win a district that leans the other way. Following Barabási’s logic, his coalition needs low-friction attachment points — Republicans who’d never vote for a Democrat on national politics but who’ll work with him on keeping control of our water. Telling him not to build those bridges isn’t principled. In a district like ours, it’s close to unilateral disarmament. I’m going to talk about that when I canvass for him in a couple of weeks.

## What I actually do on Saturdays

So here’s my answer to “why do you approach it like this”: when I knock on a new resident’s door, I’m there as a progressive Democrat, and I’ll say so plainly. But I’m also going to tell them about Swannanoa Communities Together, whether they vote with me or not, because that’s the actual bridge — a nonprofit doing real relief work that has nothing to do with which box you check in November. It’s the single issue we can agree on before we get to the ones we don’t. Neighborhood Economics is founded on what Theologian Walter Bruggeman called the Protocols of Neighborliness and that’s the basis for why I do it that way.

I don’t think that makes me less committed to my politics. I think it’s the only version of politics that has ever actually grown anything — a coalition, a movement, or a mind.

---

*What a network scientist could add to the Forensic Ecosystem Method — and why Purpose Built Communities might be where we find out*

-----

Last month I wrote about the terrain map — the recognition that the Field Guide’s player map (who’s on the field, which roles are present, is the System Entrepreneur a code-switcher, has the Prophet been co-opted) was missing something underneath it. Physical places where trust had already been built before anyone proposed a deal. Libraries, parks, church basements, ballfields. Author Eric Klinenbergcalls this social infrastructure, and his research — from the 1995 Chicago heat wave to [Elinor Ostrom]’s research proving that a watershed managed as a commons out performs one in which there is government control — makes the case that social infrastructure isn’t decorative. It’s the load-bearing structure that determines whether an intervention takes root or dies on contact.

That piece added a sixth question to the Forensic Ecosystem Method: what social infrastructure was already present that made the intervention possible? It was the right question. But I’ve been sitting with a harder one underneath it: how do we actually know? When we write up a case study and say “the terrain was there,” are we describing something real, or are we telling ourselves a good story after the fact — noticing the library and the shared board seat only because the deal already worked, and quietly not noticing all the libraries and shared board seats that sat next to deals that never happened?

That’s a methods problem, not a storytelling problem. And it turns out there’s someone whose entire career has been built around solving exactly that problem.

-----

## The Scientist Who Studies Whether Connections Actually Matter

Weihua An is a sociologist at Emory who works at the intersection of social network analysis and causal inference. His whole methodological project can be boiled down to one sharp, uncomfortable question: did a connection between two people actually cause a change in behavior or outcome — or does it only look that way because similar people, or similar places, tend to end up near each other anyway?

That is precisely the question the terrain map needs answered. An’s method has three moves, and each one maps onto a gap in how we’ve been telling the story so far.

**First, define the network carefully, rather than assuming it.** An doesn’t take “who’s connected to whom” on faith. He uses structured tools — survey questions that let real relationships surface empirically — instead of researcher assumptions about who counts as a peer. Applied to terrain: instead of a practitioner’s retrospective sense that “the Finance Wizard and the Organized Activists already knew each other,” you’d actually trace it — who sat on what board, whose kids played on what team, who showed up at the same library board meeting, and when.

**Second, separate real influence from lookalike coincidence.** This is the heart of it. Two people who both showed up to the same deal might have been connected through the terrain — or they might simply be the kind of person who shows up to things, in a neighborhood that was already going to succeed for other reasons. Dr. A uses causal-inference tools — propensity scores, matching, instrumental variables — to rule out the boring explanation before accepting the interesting one. Without that discipline, the terrain map risks becoming survivorship bias with better metaphors.

**Third, trace how things actually diffuse.** An’s most distinctive contribution is modeling how something — a behavior, a policy, an intervention — spreads through the real structure of a network, person to person, rather than just comparing a before-and-after snapshot. Applied to our work, this is the question of whether a tool that worked in one neighborhood is actually transmissible to the next one, through identifiable people and identifiable places, or whether it only looked replicable in the retelling.

Dr. An has already applied this exact combination — network structure plus causal rigor — to housing directly. [His work with Matthew Desmond on eviction found that tenants with children faced significantly higher odds of eviction judgment even after accounting for the standard confounders — evidence, not assumption, of discrimination operating on the back end of housing, not just the front door. That is what rigor looks like applied to a question the housing field mostly argues about qualitatively.

-----

## Where We Test It

Theory is easy. The real question is where the terrain map and An’s methods meet an actual neighborhood, an actual organization, and actual data.

Purpose Built Communities] may be a good possible test case, and it’s sitting in our own backyard. Their model is built around a local Community Quarterback Organization — resident-driven, working across housing, education, community wellbeing, and economic vitality in an interconnected way rather than one silo at a time. In Field Guide language, the Community Quarterback is doing System Entrepreneur work at an institutional scale, and the model has now been running long enough, in enough neighborhoods, to have a real track record of some places thriving and others taking longer.

That’s exactly the data An’s methodology needs. Instead of assuming the Community Quarterback model works because of the social connections it builds, we could trace it: which relationships actually predate the intervention, which were built by the intervention itself, and which neighborhoods’ outcomes are explained by pre-existing terrain versus the model’s own design. That is the difference between saying “this reduces vulnerability” as an article of faith and being able to show, with an actual traceable network, where and how it does.

-----

## Buildable, and Now Provable

Klinenberg ends *Palaces for the People* on the idea that a better world isn’t just possible, it’s buildable. I’ve said before that’s the whole argument of the book in one word.

What Weihua An adds isn’t a new conviction. It’s a way to know whether our conviction is right. The terrain map told us to look for the ground beneath the players. His methods are how we’d actually test whether that ground did the work we think it did — and, just as important, where it didn’t, so we stop telling ourselves stories about places that were never going to succeed no matter who was in the room.

That’s not a small addition to the Forensic Ecosystem Method. It’s the difference between a metaphor and a method.

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*Kevin Jones and Rosa Lee Harden are co-authoring* This Shit Works — And Why It Matters, *a book about the practitioners repairing local economies across America. Kevin is the founder of Neighborhood Economics, a convening and field-building platform at* [neighborhoodeconomics.org](https://neighborhoodeconomics.org).

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I have enormous respect for systems thinking. Donella Meadows. Cynefin. Complexity theory. The understanding that interventions ripple, that feedback loops matter, that the map is not the territory. These frameworks have genuinely improved how I work.

And I have watched systems thinking destroy a high-margin, purpose-driven product by doing exactly what it was designed to do.

---

## Three Brains, One Purchase

To understand what happened, you need a rough map of the brain — not a neuroscience lecture, just the functional architecture that governs how people actually behave.

The **prefrontal cortex** is the seat of system thinking. Analytical, sequential, causal. It weighs tradeoffs, models timelines, calculates risk and return. It’s the part of you that reads Meadows and builds causal loop diagrams. It is slow, effortful, and expensive in metabolic terms. It is also, critically, a lagging indicator of behavior change. You don’t think your way into a new way of acting. You act your way into a new way of thinking.

The **amygdala** — the emotional mid-brain — is where desire lives. Pleasure, impulse, craving. The same neighborhood as sex, gambling, a perfectly ripe piece of fruit. It is fast, associative, and operates below the threshold of conscious deliberation. It is also where luxury goods live. Where a great bottle of wine lives. Where a square of dark single-origin chocolate lives. The margin in these products is almost entirely emotional. Strip the emotion and you have a commodity.

The **basal ganglia** runs habit. Automatic, low-bandwidth, invisibly efficient. It is why you don’t have to think about how to drive to work. The basal ganglia frees your prefrontal cortex and amygdala for the things that actually matter — feeling and thinking — by handling the routine on autopilot. It governs more of your daily behavior than you would like to admit. It is also almost entirely immune to systems thinking.

Here is what the complexity crowd tends to forget: **most human behavior is not being run by the prefrontal cortex.** Most of it is amygdala and basal ganglia — impulse and habit — and the prefrontal cortex arrives afterward to narrate a story about why the decision was rational.

---

## What Happened to the Chocolate

Alter Eco made extraordinary fair trade, organic, carbon-negative chocolate. Their relationships with quinoa cooperatives in Bolivia were so deep that when the quinoa boom hit and large brands arrived with money to lure farmers away, the village coops held. The fair trade premium those coops received — governed by the people who earned it, not by a foundation program officer — funded schools, clinics, clean water systems. The product was also, as it happens, delicious.

We invested when they were doing $1.5 million in sales. They exited at $21.5 million, profitable, still 100% fair trade, carbon negative not through offsets but through insets — regenerative agriculture that sequestered carbon in the actual soil where the food was grown.

I wanted consumers to understand all of this. I thought that if they understood the system — the coops, the premiums, the regenerative agriculture, the carbon sequestration — they would want to participate more deeply. I launched the Hoop Fund: zero-interest consumer loans directly to the coops for infrastructure, the kind of unglamorous working capital that philanthropy ignores and venture won’t touch.

I was applying systems thinking to a product that lives entirely in the amygdala.

The Hoop Fund failed. But worse: the attempt to tell the deeper story at the point of purchase didn’t just fail to raise money. It hurt chocolate sales. The more we asked the buyer to think, the less they bought.

The two parts of the brain hate being in the same space. Asking someone holding a beautiful dark chocolate bar to activate their prefrontal cortex and think about storage spoilage rates in Bolivian cooperatives is not education. It is mood destruction. We had taken a high-margin emotional experience and tried to turn it into a systems diagram. We succeeded. We destroyed the thing that made it valuable.

---

## The Complexity Crowd’s Blind Spot

Systems thinking has a universality assumption baked into it. If you can map the feedback loops, you can intervene more effectively. If you can show people the system, they will make better decisions within it. Complexity theory tells us that understanding emergence and interdependence leads to wiser action.

All of this is true — in the domains where the prefrontal cortex is actually running the show.

But most of human life is not in those domains. Consumer behavior is not. Habit is not. Desire is not. The purchase of luxury goods is definitionally not — the moment you make it rational, you have turned it into a commodity and collapsed the margin.

The systems thinking framework, applied to the wrong domain, doesn’t just fail to help. It actively damages the thing it touches. A prefrontal cortex intervention in an amygdala-governed system is an invasive species.

---

## The Prefrontal Cortex Is a Lagging Indicator

Here is the deepest problem: the complexity crowd treats the prefrontal cortex as the place where change begins. Understand the system, change the mental model, change the behavior. This is the Meadows sequence. It is also, in most contexts, backward.

The research on behavior change is unambiguous: **you act your way into a new way of thinking far faster than you think your way into a new way of acting. That‘s what it says in the Big Book and what Richard Roher teaches his spiritual disciples.

The prefrontal cortex does not lead. It follows. It arrives after the amygdala has already decided, after the basal ganglia has already acted, and it constructs a narrative about intention and rationality. It is, in the most precise sense, a lagging indicator.

This means that systems maps, causal loop diagrams, complexity frameworks — all of the tools the prefrontal cortex generates and consumes — are most useful *after* behavior has already begun to shift. They help consolidate and accelerate change that is already underway. They are terrible at initiating it.

What initiates behavior change? Experience. Ritual. Relationship. Emotion. The amygdala and the basal ganglia, not the prefrontal cortex.

---

## Knowing When to Put the Framework Down

I am not arguing against systems thinking. I am arguing against its universalization.

Know which brain you are talking to. Know which domain you are operating in. Ask whether the intervention you are designing requires the prefrontal cortex to be in charge — and if the honest answer is no, put the framework down.

The fair trade system works, at scale, precisely because it does not require consumers to think. The premium is extracted upstream, governed by the people who earned it, and spent on schools and clinics — without demanding that anyone at the point of purchase engage their prefrontal cortex. The architecture is designed for humans as they actually are, not as systems thinkers imagine they should be.

That is not a compromise with human weakness. That is wisdom about human nature built into the structure of the system.

The Hoop Fund imagined a consumer who wanted to be an investor in the cooperative feeding them. That consumer exists. There are perhaps a dozen of them. The rest of us are holding chocolate, and we want to stay in that moment.

Systems thinking told me I could improve on that. I could not.

Know when to think. Know when to feel. And know — especially — when your most sophisticated analytical tool is the exact wrong instrument for the work in front of you.

---

*Kevin Jones is co-founder of [Neighborhood Economics](https://neighborhoodeconomics.org) and co-author of* This Shit Works — And Why It Matters.

Every time I talk about community wealth-building, someone eventually asks the co-op-zealot question: shouldn’t the community *govern* the asset, not just own a piece of it? It’s a fair question. It’s also, I’ve come to believe, the wrong first question. Governance is downstream. The thing that actually moves people — that gets your neighbor who has never owned an asset in his life to put in $250 — is a modest, real, appreciating financial return on something everyone can see and walk past.

The commons has to sit next to High Street to work in the designs I find most interesting, Coops are fine and good things. They are not our thing. We are mapping out a market that thrives next to the commons, through things like community owned commercial real estate or shared farm land where the financial return comes back to the community who pooled their money locally.

I had a conversation recently with Graham Stewart, a Scotland-born, Barcelona-based interviewer cataloging commons practitioners for a book on stewarding the emergent future. Talking it through with him clarified something I’ve been circling for a while: there’s a specific, replicable category of commons that isn’t a co-op and isn’t a REIT — it’s *community-owned real estate*, and three different vehicles are proving it out in very different sectors

.

## The pattern, in three vehicles

**[The Farmers Land Trust]** found a genuinely obscure lever: The 501(c)(25), a nonprofit structure originally written so multiple doctors’ offices could co-own a building, they repurposed so non profit can let a group of farmers can hold farmland title collectively and lease it to farmers for 99 years. Farmers who were scraping by on a couple of leased acres get ten, with the security to actually invest in the soil. The 501(c)(25) board can’t interfere with how the farm is run — its only legal job is holding the title. The land is the commons; the farm business on top is fully private and for-profit.

[Buy Back the Block**, the framework Lyneir Richardson has built with Brookings and [Chicago TREND/), does the same move for commercial corridors. It’s aimed at the well-documented gap in Black commercial property ownership, and the mechanism is blunt: buy the strip mall before the hedge fund does, structure it so neighborhood residents can invest for a few hundred to a few thousand dollars, and let them own a piece of the block instead of just shopping on it. TREND has already produced exits where people who had never held an appreciating asset walked away with real money.

**The Diversified Community Investment Fund (DCIF)**, championed by the [National Coalition for Community Capital], threads a different needle in securities law: a fund can invest primarily (60%+) in real estate and stay out of the Investment Company Act, while putting up to 40% into local businesses. That’s how ordinary residents — not just accredited investors — can legally buy in publicly, at low minimums, to commercial property that anchors the fund and businesses that ride alongside it. It’s why the model is spreading fast; four founding versions are already running, from [Local Return in Providence](/) to funds in Lansing, Traverse City, and northern Michigan. It’s being piloted in 21 cities backed by a national foundation.

Three different tax and securities workarounds, one shared architecture: a piece of real estate held in common, with a for-profit layer on top that can pay people back.

## Why the return has to be real, even if it’s modest

You don’t get people to think their way into a new relationship with their neighbors. You get them to *act* their way into it — invest a little, get a little back — and the thinking follows. That’s the whole theory. A smaller return that also produces a town your grandchildren want to move back to beats a bigger return that produces a town they leave. People will take that trade if you give them the chance to.

This is also why I push back on the instinct to make every commons a democratically governed co-op. Buy Back the Block and the DCIF model are both explicit about it: the returns are democratic, the governance mostly isn’t — it’s a for-profit entity doing the investing, a board doing the buying. That’s not a failure of the commons idea, it’s what makes it scalable. You can build in community input without requiring every investor to sit on a committee. What you can’t skip is making sure the upside flows to the local people who took the risk of showing up first.

## What this is actually fighting

Big box retail and hedge-fund-owned rental portfolios both depend on people relating to a place as consumers, not owners. Neither one produces a stake, a name on a deed, a reason to notice when the parking lot needs fixing. Community-owned real estate is a direct, structural answer to that — it converts “customer of this block” into “owner of this block,” at a price point low enough that it’s not just wealthy people doing the converting.

It’s also, not incidentally, an answer to what Hannah Arendt called the danger of people becoming irrelevant to each other. If you own a sliver of the shopping center down the street, you have a concept of neighbor again — not an abstraction, an asset you share. Faith communities have understood this instinctively for a while, which is part of why church-owned workforce housing and church-anchored DCIFs keep showing up in this work; congregations already have the trust infrastructure and the land, they just need the vehicle.

## Where I still have questions

None of these three models has fully proven it can scale past its early sites without losing what makes it work. The Farmland Commons structure depends on assembling three to thirty-five aligned nonprofits per site — that’s a lot of relationship-building to replicate quickly. Buy Back the Block’s thesis is strongest in the specific context of Black commercial corridors and predatory hedge-fund displacement; whether the same $250-to-invest structure travels cleanly to, say, a rural Appalachian downtown is untested. And DCIFs still live inside a securities-law compliance strategy that’s more art than science — the 60/40 real estate split is a workaround, not a statute, which means it’s one SEC reinterpretation away from getting harder.

I’ll be pushing on all three at Galveston this September. If you’re building something in this space — land trust, buy-back fund, DCIF, or something adjacent — I want to hear about it.

---

# The SOCAP Years: A Field Guide to 15 Years of Posts

Before Neighborhood Economics, before *This Shit Works*, there was SOCAP — and a decade-and-a-half of dispatches from the front lines of building the social capital market. Pulling the full archive together in one place, grouped by theme, because the throughlines to today’s work are hard to miss once you see them side by side.

## Foundations: Defining the Field.

The early attempts to name what we were even building.

- [Definitions](/)

- [On what Impact Invest is.

- [Social Capital Market Manifesto 2.0]

- [Pricing what matters]

- [Money as a way to keep track of flows of energy ]

- [What I think success is

- [Who owns social capital?

## Movement Building & Convening

The convener’s craft — the throughline straight to Neighborhood Economics.

- [Notes on Movement Building from a Convener]

- [Why we started the Neighborhood Economics Conference](

[An ecosystem for change]

- [Vote for my group, no really, this is different

- [Scoping Out the Operating System for the Good Economy

## Capital, Investors & Markets

The plumbing — LPs, government, metrics, and where the money actually moves.

- [Limited Partners in Impact Funds Are Calling the Shots, Research Shows](

[Beyond the J.P. Morgan Report

- [Capital is Fuel in the Social Capital Market

- [Special SOCAP Edition of MIT Journal a compilation of leading voices at the time

- [Mission Markets Working This turned out to be wrong. I really wanted it to be true.

- [(Taking impact investing to scale means) Figuring out how to work with government]

- [Broken Markets, Mending Myths

- [Trust Your Gut]

- [UK and two U.S. metrics groups join up

## Company & Sector Case Studies

Ground-truth stories of businesses proving the model.

- [Using Activism to Drive Sales and Loyalty, Nutiva is a Rocket

- [Sierra Gorda Brings Social Impact to Carbon Sales

[From Pilot Project to Tripling in Size in Three Years: Grassroots Business Fund Shows What Scale Means

- [Alter Eco becomes third Goodcap company Our Impact investment venture fund focused on social enterprises needing expansion capital. Launched in 2008. Three out of four were wins.

- [How to game Pepsi Refresh]/)

## Health

- [Health: The Untapped Market]

- [Introducing Two Themes: Place-Based Innovation and a Focus on Health] A precursor to Neighborhood Economics.

## Social Innovation, Gender & Justice

- [Social Innovation is Starting to Look Like LEGOs: A Pattern is Emerging

- [Selling Justice like Gatorade, as a Performance Enhancer] Another gender lens story; investing in women produces higher financial returns.

## Global Perspectives

- [Social entrepreneur wants to learn Impact Investing](/)

---

### Further Reading

Full archive: [Kevin Jones, Author at SOCAP Global](https://socapglobal.com/author/kevin-jones/) (pages [1](https://socapglobal.com/author/kevin-jones/) · [2](https://socapglobal.com/author/kevin-jones/page/2/) · [3](https://socapglobal.com/author/kevin-jones/page/3/) · [4](https://socapglobal.com/author/kevin-jones/page/4/))

A recent Atlantic piece by Rogé Karma “A Perfectly Crude Solution to America’s Housing Shortage,” published July 17, 2026 in his *Work in Progress* newsletter lays out a strategy I haven’t seen discussed much in our circles, and I think it deserves a hard look before Galveston: **pay residents directly, in cash, for approving new housing.**

## The idea, and the receipts behind it

A handful of Democratic-aligned think tanks have converged on a similar structure lately. The Center for American Progress,through senior fellow Chad Maisel, has proposed flat per-resident payments tied to communities hitting housing-production targets, part of their broader “Build, Baby, Build” plan. The Searchlight Institute, a newer think tank, has a variant: a federal rebate equal to the average annual rent increase in a resident’s city, paid out when the community meets housing targets. Aaron Shroyer, who helped design the Biden administration’s housing policy agenda and now works on this at Searchlight, frames it as: build enough and we’ll effectively freeze your rent

.

What’s new is that there’s now real research behind the “would this actually work” question. A forthcoming paper by GWU political scientist Michael Hankinson ) with economists Edward Glaeser, Joseph Gyourko, and Morris Davis surveyed roughly 1,700 residents in expensive metros — New York, LA, the Philadelphia suburbs — offering hypothetical cash amounts, from $250 to $9,000, in exchange for approving specific housing proposals near them. More than 80 percent said yes to at least one offer. But the price to flip the median voter varied enormously by context.

## Where this maps onto our work

A few things jumped out at me, thinking about Cook County, Orange County NC, and the tax-justice conversation we’re building for Galveston with Joe Minicozzi and Kelwin Harris:

**Density sets the price, and it’s not subtle.** Dense urban neighborhoods needed only a few hundred dollars — many residents said yes with nothing offered. Low-density, high-income suburbs didn’t move even at $9,000, the study’s ceiling. This tracks with something Urban3’s land-value work has shown for years: the fiscal geography of a place predicts its politics as much as its demographics do in a case study in Leander, TX. It found that smaller cities near large metropolitan areas struggle to figure out their place in the regional context. In Leander, using smaller neighbors as examples of what’s possible in terms of future development is more effective than comparisons to Austin.

**Cash beats in-kind, by a lot.** When the same value was offered as a parks-and-infrastructure fund instead of a direct check, residents needed *ten times* the money to say yes. That’s a big tell for anyone designing community-benefit agreements — the form of the benefit matters as much as its size.

**Framing and proximity multiply the ask.** A project next door to someone’s house doubled the required payment versus one at the edge of the neighborhood. A project denser than its surroundings quadrupled it. A project earmarked for low-income residents specifically required five times the payment. That last one is uncomfortable, but it’s exactly the kind of finding our Forensic Ecosystem Method work should be naming rather than glossing over — status-quo bias doesn’t disappear because the cause is just.

**This is a real alternative to the ROAD to Housing Act model**, which funnels federal money to *local governments* that hit housing targets rather than to *residents*. The Hankinson research suggests that’s the less effective lever — money that flows to a city council doesn’t move the individual voter’s calculus the way a personal check does.

## Where I’m still skeptical

None of this has been tried in the real world yet — it’s survey data on hypothetical proposals, and stated willingness-to-accept often diverges from revealed behavior once real neighbors, real construction noise, and real politics enter the picture. And a program that requires the deepest subsidies in exactly the wealthiest, most exclusionary suburbs is a program that will struggle to pass in exactly the places it’s most needed. Cash-for-yes also sits close to legalized quid pro quo, which is politically combustible even if it’s better than the status quo.

Still — for a movement that has spent a decade trying to *persuade* NIMBYs and mostly failed, “make it worth their while” is at least a different theory of change than the ones we’ve been testing. Worth a session thread at Galveston, maybe paired with the tax-justice track.

I heard the clearest version of it recently from Kelley McRae, an Episcopal diocesan Missioner and organizer in Taylor, Texas. Taylor landed a multi-billion-dollar Samsung chip plant — the kind of investment every economic development office in the country dreams about. But the property tax increases that came with it have hit small, locally owned businesses hardest. Downtown shops and restaurants — the ones that were already operating on thin margins — are closing. Meanwhile, the city is pushing a data center into the historically Black Southside neighborhood, on land that had been promised as parkland thirty years ago. When residents organized a petition with 1,400 signatures asking the city council to slow down, it was rejected — reportedly decided before the meeting even started.

This isn’t really a Taylor story. It’s a story happening in dozens of communities right now, and it’s why data centers — and the displacement, both residential and commercial, that follows them — are going to be a focus area at Neighborhood Economics in Galveston this September 15–16.

## It’s not just housing displacement anymore

We’ve spent a lot of time at Neighborhood Economics on housing displacement — the algorithm of property tax injustice, the way a wealthy household moving into a neighborhood quietly raises everyone else’s tax burden. Joe Minicozzi] has mapped this out block by block in city after city, and he’ll be back on our tax justice stage in Galveston.

But what’s happening in Taylor, and in dozens of towns hosting the AI-driven data center boom, is business displacement running on the same engine. The mechanism is identical — rising valuations, rising taxes, no plan for who gets priced out — but the target is different. It’s the bookstore. It’s the diner. It’s the mom-and-pop shop that anchored downtown for thirty years.

## The fights that are actually winning

What’s given me some hope is watching how communities are fighting back — and increasingly, they’re finding leverage even when the city won’t listen.

In Tucson, the city council voted 7–0 to reject a proposed data center’s request for water access, and Amazon — the project’s original tenant — pulled out. The fight isn’t fully over there) — the developer restructured and found a new partner. But the vote mattered.

In DeForest, Wisconsin, a $12 billion data center campus collapsed in a single day after Wisconsin Watch revealed that village staff had been quietly negotiating with the developer for seven months before residents ever heard about it. The lesson there wasn’t really about public pressure — it was about transparency. Once the secrecy was exposed, the political ground shifted overnight.

The NAACP’s Center for Environmental and Climate Justice has taken a more direct approach, suing Elon Musk’s xAI over pollution from a Memphis facility and publishing community benefits agreement templates that Black communities facing data center siting — like Taylor’s Southside — can use before a deal is finalized, not after.

A longtime organizer who now hosts a podcast called *The Hum*, has been connecting a cross-state network of data center opponents — currently around 350 organizers across 40-plus states. His argument, made recently with writer Astra Taylor in The Guardian, is that this fight is one of the rare issues that unites people across the political spectrum. Gallup polling backs that up: 75% of Democrats and 63% of Republicans oppose new data centers in their own communities.

Good Jobs First,, the national subsidy watchdog group, brings something different to the table — hard numbers. They’ve documented that Texas alone handed out roughly $1 billion in data center subsidies in FY2025 with almost no public disclosure of who received it or what was promised in return. That’s exactly the kind of leverage a coalition like Kelley’s needs and doesn’t yet have.

## What we’re building toward in Galveston

Our model at Neighborhood Economics has always been the same: gather the national experts who’ve actually solved a piece of the problem, and put them in a room with the local practitioners who are living it. Not to hand down a strategy, but to let a local solution or strategy evolve out of the connection.

That’s what we’re doing here. Before the conference, we’re working to set up calls between Kelley’s coalition in Taylor — her church, a South Side nonprofit, local activists, housing advocates — and some of the leaders named above, to figure out together what data, what tactics, and what pressure points might actually move a city council that isn’t currently listening.

If your community is fighting a data center, or fighting the tax and displacement fallout of any “transformational” investment, I’d like to hear from you before September. This is exactly the kind of local, replicable fight our conferences exist for.

---

[Napoleon Wallace], a genius and one of my hero’s, wrote a piece for Impact Alpha /) has a line I can’t shake: American capitalism just turned 250, and it’s still acting like an adolescent — “old enough to know better but young enough to do it anyway.”

His argument, is simple and devastating. Take a company’s profit, subtract its actual net impact on people and planet, and what’s left over isn’t earnings — it’s an unpaid bill. A cost quietly shifted onto a worker, a watershed, a county health department. Scale that up and you get an economy that’s never been richer on paper while life expectancy in the US falls further behind every other wealthy country. We got better at extracting value. We got worse at converting it into anything that looks like a life.

His fix operates at the top of the system: standardized impact accounting, real penalties for misrepresenting harm, buybacks restricted to companies with positive net impact. Treat externalities the way we learned to treat financial fraud after the 1930s — expensive to hide.

Here’s why I think this matters for those of us doing the unglamorous work at the neighborhood level: **Wallace is describing, at macro scale, the exact wound that shows up on Main Street.** The extracted value doesn’t vanish — it lands somewhere. It lands in Swannanoa. In Galveston. In the county that inherited the pollution, the underpriced labor, the stranded infrastructure, and none of the balance sheet.

Local economic healing and macro accounting reform aren’t two different projects. They’re the same project, viewed from two ends of the telescope. You can’t price externalities honestly without local data — someone has to actually measure what happened to *this* watershed, *this* workforce. And you can’t heal a local economy sustainably if the rules one level up keep rewarding the extraction that wounded it in the first place. Every Diversified Community Investment Fund (DCIF) every community land trust, every tax-justice fight we cover is local infrastructure trying to do manually — and imperfectly — what Wallace wants built into the system by default: make the true cost visible, and make somebody answer for it.

The “profitable externality loophole,” as he calls it, isn’t an abstraction to the practitioners we convene. It’s the reason a neighborhood’s health outcomes and its wealth stay divorced from each other for a generation. If accounting reform ever does force companies to internalize what they’ve been externalizing, the places positioned to capture that redirected value will be the ones that already built the local ownership structures to receive it. That’s the work. That’s the bet.

---

**

Politico’s July 4 package asked eleven historians to grade American democracy at 250. Buried in the lightning-round format was something more interesting than any single grade: three of the eleven — Joshua Zeitz, Greg Jackson, and Sheryll Cashin — arrived at the same answer from three completely different starting points. And their conclusion is that local community engagement is the key to holding the American experiment together is what we have found at Neighborhood Economics as we gather the people repairing local economies. Repairing the civic infrastructure is linked with repairing the local economy.

Zeitz is a Politico contributing writer with a Brown PhD and faculty stints at Harvard, Princeton, and Cambridge. His most recent book, *Lincoln’s God*, traces how a skeptical, distant deist became the president who called the Civil War divine punishment for slavery. In the roundup, Zeitz’s prescription isn’t policy — it’s a “third Reconstruction,” explicitly modeled on the first two: not a rewrite from the top, but “renewing institutions that have lost public confidence, expanding opportunity, strengthening civic life.” History, for Zeitz, is a record of reconstructions citizens chose to undertake.

Jackson runs *History That Doesn’t Suck*, a podcast with 50 million downloads, and holds UVU’s America 250 professorship. His new book, *Been There, Done That*, is built on a single premise: America has navigated worse before, and the how matters more than the reassurance. His answer names the mechanism directly — “public virtue,” which he defines not as annual voting but as lifelong learning, media literacy, and year-round participation. Notably, he roots this in the Founders’ own vocabulary, not his.

Cashin, Georgetown’s Carmack Waterhouse Professor and a former Thurgood Marshall clerk, writes from the sharpest edge of the three — her scholarship (*White Space, Black Hood*) is about how the state manufactured racial caste through geography. Her forthcoming book is titled, tellingly, *On Freedom: Essays on How Black Americans and Their Allies Perfected Democracy*. Her line in the roundup is the flattest of the three: “No court, no military, and no single leader can save a republic whose citizens abandon democratic responsibility.”

Three different archives — presidential faith, national mythmaking, racial caste — and one convergent claim: democracy is not self-executing. Institutions can hold the space, but they cannot generate the will.

That’s not a new idea to anyone doing place-based economic work. It’s the same finding that shows up in every ecosystem I’ve mapped through Neighborhood Economics’ Forensic Ecosystem Method — the tools that produce a phase shift are never the ones imposed from outside. They’re the ones a Mother Hen, a Connected Evangelist, a community quarterback and a handful of Organized Activists build together, locally, because no capital and no court order can substitute for a smartest table.

Zeitz, Jackson, and Cashin are describing the same mechanism at national scale that we’ve been documenting at neighborhood scale. That should be reassuring — and also a reminder that saving the country starts where we live.

---