Let’s try to keep cash in our community

Most discussion about how to boost the Yukon's flagging economy focuses on exports. Rarely do we speak about how to reduce the amount of cash that we send Outside.

Most discussion about how to boost the Yukon’s flagging economy focuses on exports. Rarely do we speak about how to reduce the amount of cash that we send Outside.

Since humans first swapped animal fur for firewood (or something), trade has functioned on the premise that we are all collectively better off if we sell the goods and services that we are good and efficient at producing and providing to others and vice versa.

The problem for the Yukon is it’s not really clear what, other than a handful of items, we can offer to those outside the territory to help pay for all the things we bring in.

Producing raw materials for consumption elsewhere is our most obvious export – which is why it has spent so much time at the centre of political debate in the territory. But for many reasons – both cyclical and structural – we aren’t doing very much of that relative to the number of people living here.

Tourism is another notable export but has somewhat limited potential and has to be balanced against the fact that we Yukoners are prolific tourists ourselves. Tourists may flock to the Yukon, but we Yukoners spend a significant amount of our money travelling outside the territory as well, thus removing it from the local economy.

What else is there? Not much. A small number of other local businesses export goods and services from the territory but nothing on any sort of large scale.

Really, we are good at convincing Ottawa to send us oodles and oodles of free money which, if we’re honest with ourselves, is the only reason most of us are still here. In 2011 we imported $1.8 billion dollars’ worth of goods and services from the rest of Canada and the world and only exported about $700 million. That “imbalance of trade” could not be sustained very long were it not for our massive influx of federal dollars.

Perhaps part (and I emphasize that word) of the answer is to be found in keeping more money here in the territory. Every dollar we spend outside the territory is another dollar taken out of our local economy and deducted from our GDP. Every dollar we spend locally circulates, generating more economic activity.

Last week’s announcement of an agreement between the Yukon Carpenters Union and the contractor hired to construct a major addition to Whitehorse General Hospital is a good example and should come as welcome news for the territory. Infrastructure projects will always provide some economic benefit but if we hire outside contractors (as we sometimes need to do) who in turn bring in outside labour and use imported supplies to complete the work the benefit is greatly diminished. Sure, some money is spent locally on lodging and meals, but much of it is taken south after the job is done.

To the extent possible within the context of our free trade obligations, this agreement should serve as a model for public spending.

At the individual level we can do our part by buying goods and services that keep Yukoners employed. Even if a business is owned by outsiders, if that business is employing workers here in the territory more of your dollars will continue to recirculate in the local economy, generating more economic activity. A dollar spent at your local big box store is still better for the local economy than a dollar spent online shopping.

When we can, buy your goods and services from businesses owned by Yukoners. Once your dollars are sent back to Bentonville, Arkansas they aren’t coming back. If they stay in our community they will benefit everyone.

I fully appreciate buying local isn’t always possible. We don’t produce very many iPods locally. There are many things you simply can’t get in the territory. In other circumstances the price difference between that offered by local merchants and that offered by bigger companies is so vast that no rational consumer could possibly justify it.

But if all things are equal or, if you’re feeling particularly community minded and the difference isn’t that significant, seriously consider the local option.

We have had some successes. The loyalty and enthusiasm shown by Yukoners towards Air North since it expanded its service to include routes to major centres in the south is something that I would like to see extended towards other businesses in the territory. The recent creation of a local store selling Yukon-grown food is another step in the right direction that gives consumers local options and farmers a venue to sell their goods.

But in other areas our obsession with cost savings comes at the expense of our local community.

I appreciate that I am asking a lot, and as I’m writing this column that voice in the back of my head is “Quit being naive Carruthers. You’re asking people to sacrifice their own hard-earned dollars for the greater good of the Yukon community. Do you know how stupid that sounds?” Yes I do. Particularly so when my audience includes so many people who make their living through government for whom the overall health of the local economy is little more than an abstraction with no direct consequence.

But with mining in a slump, anything we can do to generate a little bit more local economic activity is a good thing. A little thought about where our dollars – both government and private – ultimately end up should be a part of the conversation.

Kyle Carruthers is a born-and-raised Yukoner who lives and practises law in Whitehorse.

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