Robert Reich
The Coffee Klatch with Robert Reich
The heart of a community: a small business

The heart of a community: a small business

What the rescue of Dan & Whit's General Store can teach us

I’ve got a special place near my heart for Dan & Whit’s general store in Norwich, Vermont. It was there for me during my undergraduate years in college in nearby Hanover, New Hampshire — often on snowy evenings when I couldn’t get supplies elsewhere. Years later, when my parents moved to Vermont for their retirement, Dan & Whit’s was there for them, too.

Like many places around the country, Vermont has been struggling with finding enough workers to fill jobs. But unlike most urban centers, where the obvious answer is to pay workers more, rural towns can’t always count on higher wages to elicit more job applicants because populations are thin and often declining. And unlike profitable national retail chains, mom-and-pop businesses can’t just absorb higher labor costs. And they can’t simply pass them on to customers in higher prices, because small-town customers might not have the ability to pay.

So when Dan & Whit’s owner Dan Fraser recently put up a "Help Wanted" sign, the inhabitants of Norwich knew it was bad news. (I never met the younger Dan but I’m sure I met his grandfather, who passed the store on to his father, who passed it on to Dan.) After three generations, Dan would have to close the place down if he didn’t get help. So what was he to do?

I heard the rest of the story on the radio. It turned out that Dan didn’t need to do anything. Word went out. Soon, Dan’s customers began applying for the jobs. Rick Ferrell, a local doctor, took on a shift at the register. A retired finance director applied for the deli counter. A nurse, a teacher, a psychology professor, a therapist, a school principal — nearly two dozen customers have stepped up to stock shelves, do the inventory, and clean up the place, so that Dan & Whit’s can remain open. (Virtually all of these new hires are donating their hourly wages to some of Dan’s favorite charities.) 

I’ve spent a lot of time over the years examining what happens to communities when important businesses close or abandon them — often because some bean counters back in headquarters hundreds or thousands of miles away decide it’s not worth the cost of keeping the businesses going where they are. Economists often praise capitalism’s wondrous “efficiencies” at moving assets to their “highest and best uses.” Well, there’s something to that. But what’s left out of the equation are the social costs of these moves. They can be quite high.

Friends, my newsletter on power, politics, and the real economy is reader supported. Both free and paid subscriptions are available. If you’d like to support this work, please consider a paid subscription. Many thanks.

When asked why the people of Norwich stepped in to help Dan & Whit’s keep going, employee Dianne Miller said it was "because Dan & Whit's is the heartbeat of this community." Others described it as the "heart of the town." That’s the best quick summary of the social benefits of a place like Dan & Whit’s I’ve ever heard. Communities do have hearts. When businesses at those hearts disappear, more is lost than an economic asset. The community loses a place that allows it to be a community — a place where people meet up, congregate, exchange gossip and information, barter, learn about common problems, sometimes decide to take action.

I remember Dan & Whit’s as such a place. I can’t imagine Norwich without it. Luckily, it won’t have to be. But this isn’t just a “feel good” story about one country town coming together to save an iconic general store. It seems to me there’s an important lesson here for all of us, wherever we live.

American capitalism is the harshest form of capitalism in all of the world’s advanced economies. It takes almost no account of social costs and benefits. Businesses swoop in and swoop out wherever and however profits can be maximized and losses minimized.

But communities are different. They aren’t nearly as footloose as financial capital. They’re built on social capital, which often takes years to accumulate and can’t be cashed in.

I think people owe something to businesses that are the hearts of our communities. Maybe we shouldn’t allow big chains or Walmarts to drain our main streets of the commerce they need to survive. (Even if Walmart’s items are cheaper, the social costs of losing the small businesses that undergird our community are often way higher.) Maybe we should donate some of our own time and labor to account for the importance of these core businesses. Maybe those of us who can afford to should buy shares in them, to give them an added financial cushion. At the very least, we owe them our patronage — rather than, say, the Waltons or Jeff Bezos.

What do you think?

Give a gift subscription

Leave a comment