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The Sustainable Economies Law Center is developing the legal infrastructure necessary for a new, resilient, sharing economy to thrive in the United States.
The New Idea
Over the last decade, experimentation with new economic models has been accelerating across the U.S. and the world. Often referred to as the “new economy” or the “sharing economy,” these models include cooperatives of various kinds, community-owned enterprises, time banks and more. This economy is based on shared ownership and community control, and aims to stabilize local economies while also supporting environmental sustainability. Its advocates point to the new ways of organizing ourselves as producers and consumers as an antidote to many of the social and environmental ills that plague modern capitalism.
However, the sharing economy lacks the legal infrastructure to go mainstream. This is because our laws and regulations – and even how lawyers are trained – were shaped by conventional economic models, with promote and preserve separation between producer/consumer, employer/employee, landlord/tenant, and so on. When conventional laws are applied to initiatives that create community-controlled sources of food, jobs, and housing, for example, the projects face immediate legal barriers to launch.
In 2009, Janelle co-founded the Sustainable Economies Law Center (SELC) to develop an entirely new legal infrastructure and legal expertise that provides a foundation for the new economy to grow. SELC focuses on key interventions that will enable the widespread creation of new economic models, ranging from direct legal support to communities all the way to drafting new legislation for cities and states. She and her team are building networks of legal practitioners and changemakers across the U.S. and beyond with the goal of establishing a new field of transactional law practice meant to directly support new economic activity. SELC was the driving force behind drafting and passing the 2012 California Homemade Food Act, which removed key barriers to home-based food enterprises and triggered the creation of 2,000 new businesses in the first year after the law took effect.
We live world where people have become increasingly dependent on jobs, energy, food, and other necessities provided by companies and institutions located outside of their communities. As a result, communities everywhere are vulnerable to economic instability. A single employer can devastate a town by closing a manufacturing plant. Fluctuating commodity prices can destroy an entire farming community. A new big-box store can wipe out dozens of locally owned shops. In short, local economies lack resilience. This is a moment in history when communities most need economic resilience, as two trends are set to devastate communities. First, 93% of wealth in the U.S. is controlled by the wealthiest 20% of people, and this gap between the rich and poor continues to widen. Second, by nearly every measure, humans are depleting and polluting natural resources faster than the resources can be replenished and restored.
We’ve been aware of both problems for decades, and yet the problems persist. Environmental organizations sometimes block destructive development. Charities and philanthropists provide relief to the victims of inequality. Businesses reduce harm by “greening” their products. Unfortunately, these interventions fail to address a core problem: Too many businesses are owned and controlled by shareholders who are disconnected from and have no incentive to ensure the wellbeing of communities where they do business.
Community-owned and cooperatively owned businesses can reverse harmful trends by regenerating local wealth and by giving people control of their own economies. But our current legal systems make this solution incredibly difficult. Many laws were designed for conventional competition-based and extractive businesses, and the laws form barriers to innovative ownership models based in community and built upon principles of equity and trust. For example, laws designed to protect workers actually make new forms of worker-ownership more difficult. Additionally, most lawyers serve the wealthiest 20% of society, and most people cannot afford even basic legal services. As a result, communities seeking to establish projects that advance economic resilience hit barriers when they pursue legal services and seek to comply with the law.
Janelle’s goal is to reach a tipping point so that within 10 years, communities everywhere can feasibly establish projects that create locally controlled jobs, food, energy, and other necessities. To that end, the Sustainable Economies Law Center focuses on key leverage points that will shift the legal profession to support this vision. The organization’s strategy includes the provision of direct legal services through a legal café model, sharing legal knowledge so that new and innovative legal structures can be replicated by others, changing laws at the city and state level, and training the next generation of community lawyers in partnership with law schools and through a creative legal apprenticeship model.
The work of SELC begins at the community level in Oakland, CA where it seeks to increase the accessibility of legal services for local entrepreneurs. Despite the challenges of navigating existing laws and regulations, the average person has little or no access to affordable legal council. So SELC created the Resilient Communities Legal Cafe, which Janelle describes as 1/3 legal advice clinic, 1/3 living classroom for lawyers and participating law students, and 1/3 community-building salon. Community members are invited to drop in to the welcoming cafe-life space, connect with one another, attend discussions and teach-ins, and get legal advice on their initiatives. In its first year, the Legal Cafe provided advice to 240 Bay Area enterprises and organizations. SELC is now developing tools to help groups replicate the café model elsewhere.
Importantly, the time spent in the Legal Cafes with entrepreneurs – whether an immigrant family looking to start an urban farm or the founder of a housing cooperative – highlights the various legal barriers in place and informs all of SELC’s additional efforts. One of these efforts is to share best practices broadly throughout the legal profession and develop a body of knowledge and practice that lawyers from around the country (and the world) can adapt to their own circumstances. Traditionally, lawyers preserve their economic status by obscuring the tools of their trade. SELC takes a radically transparent approach: sharing as much information as possible in order to empower communities with knowledge of what is possible under current laws. To maximize the reach of its growing knowledge base, SELC has launched four web platforms designed to be go-to locations for legal information: Co-opLaw.org, UrbanAgLaw.org, CommunityEnterprise.org, and CommunityCurrenciesLaw.org.
The experiences and information gleaned from its Legal Cafes also inform SELC’s work to shift policy and draft new legislation more favorable to enterprises in the sharing economy. A future of vibrant community-based economies will require legal changes at the local, state and national levels. To that end, SELC engages with policy-makers, drafting policy briefs, and shepherding in new laws. SELC co-produced an actionable policy guide for cities, including a set of 32 recommendations for how cities around the world can immediately lower barriers and create incentives for sharing-based economic activity.
In 2012, SELC drafted the high-profile Homemade Food Act which passed the California legislature and which removed key barriers to home-based food enterprises. More than 2,000 new small businesses have sprouted in the state as a result. This victory put SELC on the map and has helped develop momentum for similar legislation: within the last year alone, SELC introduced four pieces of groundbreaking legislation in California, including the Neighborhood Food Act, which removes legal barriers to the sale of homegrown and urban-grown produce, and the Worker Cooperative Act, which creates a type of legal entity designed specifically for worker cooperatives. Their intent is for each bill to serve as a model law for adoption in other states (already underway in Maryland and Hawaii), where similar well-meaning but calcified regulatory structures prevent innovation.
In addition to policy change, SELC is working to foment changes within the legal profession itself, which for the most part has not foreseen the trend toward a more sharing economy. Janelle believes that every community should have legal practitioners ready to assist local economy entrepreneurs – and her team has set a goal of having 100,000 transactional lawyers for communities in the U.S. within 10 years. However, this goal has implications for how lawyers are trained, how they establish law practices, how they communicate, how they set fees, and much more. Janelle and her team have thus been experimenting with ways that the legal profession can recreate itself in service of community resilience, including through a creative apprenticeship model that, in four states, allows lawyers to practice law without going to law school and without incurring massive debt that all but excludes them from becoming true civil servants.
Meanwhile, Janelle’s recent book, Practicing Law in the Sharing Economy, published by the American Bar Association, provides a detailed blueprint for law practices in this emerging field, and how lawyers can navigate the laws in a collaborative as opposed to competitive economy. Since it was published, hundreds of lawyers from around the globe have been in touch with SELC, and by 2015 many will join SELC’s online network of likeminded legal professionals. Finally, through other media, including legal workshops and even cartoon videos, SELC is helping change the conversation about the role of law in shaping the future of our economy and as a force to disrupt rather than maintain the status quo. As Janelle puts it, “most people go to lawyers when they have a problem, not when they have a solution to a problem. We want every changemaker in every city to be able to get the legal advice/support they need from a place like SELC.”
The Sustainable Economies Law Center was founded in 2009 and was largely volunteer-run until 2012 when the 11th Hour Project began to support its growth. Today SELC has six full-time staff and hopes to add one more attorney and one more administrative staff by 2015. It has adopted a highly unconventional salary structure, where all employees earn the median salary in Oakland, which is currently $43,000. Their annual budget has grown from $33,000 in 2011 to $349,000 in 2014.
Janelle’s history as a creative thinker and doer comes in part from an unconventional upbringing – which included homeschooling beginning at age ten – and from a deep sense of urgency about creating a more compassionate world where no one is expected to live in perpetual struggle. As a law student, when Janelle saw how easily her peers were pulled away from their values and into high paying legal work for wealthy clients, she vigorously resisted that pull. Against the advice of professors, lawyers, classmates, and the Career Services Department, she did what almost no one else dares: she started a law practice right out of law school that would specialize in “sharing law”. She recognized this was a big risk, but believed strongly that the legal profession desperately needed to reinvent itself in service of community wellbeing.
Janelle’s history as a creative thinker and doer comes in part from an unconventional upbringing – which included homeschooling beginning at age ten – and from a deep sense of urgency about creating a more compassionate world where no one is expected to live in perpetual struggle. As a law student, when Janelle saw how easily her peers were pulled away from their values and into high paying legal work for wealthy clients, she vigorously resisted that pull. Against the advice of professors, lawyers, classmates, and the Career Services Department, she did what almost no one else dares: she started a law practice right out of law school that would specialize in “sharing law.” She recognized this was a big risk, but believed strongly that the legal profession desperately needed to reinvent itself in service of community wellbeing.
Prior to becoming a lawyer, Janelle founded a number of youth programs. She has always felt the greatest empathy for teenagers, in part because of her own struggles as a queer and closeted young person. And she was prone to starting initiatives rather than volunteering for existing ones because she believes that society needs to go far above and beyond what it currently provides to people. One such initiative was a music program for detained immigrant youth; another was an after-school program for at-risk youth in Los Angeles County, where her students explored social justice issues related to education, the environment, and criminal justice. In law school, Janelle helped launch clinics to defend youth in school expulsion hearings, to teach incarcerated youth about their legal rights, and to represent youth with complaints against police. She has also worked in many settings with mentally ill adults, foster youth, and the homeless – all of which has given her strong training on how to identify what matters most in life, which, to Janelle, is people.