Scotland is pointing the way to a new economy

Neil McInroy

OBAN – In country after country nowadays, rising living costs and child poverty, increasing climate displacement, ever-more concentrated land ownership, and growing insecurity have exposed the limits of the prevailing economic model, with its dependence on fossil-fuel-powered growth and trickle-down theory of wealth. Continuing down this path will only amplify today’s structural inequalities. That is why Scotland has decided to take a different route, in the form of the Community Wealth Building (CWB) Bill passed by the Scottish Parliament.

CWB puts broad-based ownership, collective decision-making, and the circulation of wealth at the center of economic design – an approach pioneered two decades ago by The Democracy Collaborative (where I work) in Cleveland, before expanding to other cities in the United States. It was later brought to the United Kingdom, where it was first implemented in Preston and then in North Ayrshire, Scotland.

Over time, CWB has matured into a coherent strategy for systemic economic change, standing on three legs: movements and networks that demand a fairer, more equitable economy; practical, on-the-ground examples of what this could look like; and supportive public policy and legislation. If any of these legs is missing, economic transformation becomes far less likely.

The new Scottish CWB Bill, has significantly strengthened the policy and legislative leg of the wider movement. This enabling framework will not remake the economy overnight; rather, it will empower councils and other public bodies to prepare and implement CWB plans, with the Scottish government required to monitor progress. By providing the direction and means, the CWB Bill can bring about real change.

The legislation has been a long time in the making. Over the past decade, communities and local groups across Scotland have taken action aligned with CWB’s five pillars model. This includes efforts to increase the number of social enterprises, cooperatives, and employee-owned firms; the establishment of the Fair Work Convention, an independent advisory board to Scottish ministers; programs to help organizations use democratic methods of raising finance; and initiatives that support land stewardship and progressive procurement.

Moreover, the CWB Centre for Excellence, hosted by the Economic Development Association of Scotland, has helped the movement grow by providing guidance and sharing resources. The Bill builds on this work, creating the conditions to scale existing initiatives and improve coordination across a range of programs and organizations.

Some argue that the Bill is not radical enough. But this criticism reflects a fundamental misunderstanding of how economies are transformed. Despite a surfeit of grand visions and sweeping declarations about a post-capitalist future, reconfiguring economic power requires on-the-ground work with local communities. Simply imagining a better world is not enough; tangible steps must be taken to achieve this goal.

CWB specifies what those steps might be: supporting local procurement, developing community-owned assets, strengthening credit unions, redirecting mainstream investment, and demanding better work conditions, among other things. The CWB Bill will support such efforts and ensure that they are recognized as mainstream, rather than marginal.

The harshest critics of neoliberalism often assume that it will collapse under the weight of its own contradictions or because of dramatic top-down change. But enduring change tends to emerge from bottom-up movements supported by policy frameworks – like the CWB Bill – that help communities and institutions develop the tools and the capacity to make meaningful progress.

This bottom-up approach has been embraced globally. In the US, cities like St. Louis have begun to develop an economy anchored in the community. CWB has gained traction in the Netherlands, Poland, Australia, New Zealand, and South Korea. A worldwide movement, based on models that place local people – not distant investors – at the center of economic life, is gathering pace.

In this context, Scotland’s CWB Bill can set an example, charting a progressive path comprised of practical, achievable steps. It sends an important message to the people striving for a new economy: The struggle will be won not in elite institutions or think tanks, but in local communities, based on coordinated action and incremental successes.

Progress will take time, and there will be setbacks as well as leaps forward. But as more people confront economic failures and climate disruptions, CWB will become even more attractive. When that happens, Scotland will be able to show the rest of the world where to begin.

Neil McInroy, global lead for community wealth building at The Democracy Collaborative, is chair of the Economic Development Association of Scotland and previously advised the Scottish government on CWB policy. This article was distributed by Project Syndicate.