The discussion on co-ops has long deviated from Norm's original
questions which, I don't believe, have ever been addressed. The
question is why would one want to organize and support a co-op.
Now being a post-Autaustic economist, I go out and look at the
real world and ask, why did I, you, she, he etc. join a co-op.
It will not surprise you, I suspect, that I actually have done some
research on the history of co-ops and would make the following
general comments.
The first consumer co-op of the modern co-op movement was the
"Rochdale Pioneers", a British co-op set up the purpose of which
was to raise funds for the establishment of a co-operative (utopian)
community. The colony was never established but the principles of
consumer co-operation of Rochdale continue to this day.
(Incidentally, the co-operative, and radical, student residence in
Toronto in the 1960s was called Rochdale House.)
In Canada, consumer co-ops had their origins in rural towns where
local people came together to set up competitive stores to local
monopolies (in some cases company stores) which used their
local monopoly to charge exhorbitant prices. With the advent of
supermarkets, the major chains would not go into small rural towns
so the co-ops federated to maintain what is in effect a supermarket
structure with their own wholesaler and national brands. (Co-op non-
hydrogenated margarine and non-sweetened pink grapefruit juice
are the best on the local market and a fraction of the nationally
advertised brands.)
At the producer level, the main co-ops are the grain pools set up to
break the monopoly of the line elevator companies (e.g. Cargill) and
to return the handling charges to the farmers.
But, there are other producer co-ops that were set up for other
reasons. Our local courier co-op was set up as a result of a strike
of couriers from a subsidiary of Air Canada. During the strike, the
drivers set up the co-op to provide an income during the strike and
just continued it. (I don't think the strike was ever settled nor was
the Air Canada company ever revived.) The retail co-op I do some
of my shopping at is an Aboriginal producer co-op in the heart of
the Aboriginal district of Winnipeg close to where I live. It was set
up with help from other co-ops and the major local credit union and
other social action groups and the NDP to promote local
development, job experience and training, and reasonable prices
(including credit) for an area and a people that were not being
served (i.e. were discriminated against) by capitalist companies. It
also serves as a marketter/wholesaler for other Aboriginal co-ops
and enterprises such as the wild rice co-op, moccasin makers,
star blanket co-op, aboriginal blueberry and wild berry jam makers.
In store they also bake bannock daily (the original native bread)
and sell other native specialties.
In the case of the Mondragon producer co-ops, the original 5
person co-op was established to provide jobs for local graduates of
a technical school in a region of high unemployment. (They now
have about 25,000 owner/members.)
The most impressive co-ops in Canada are the financial co-ops, or
credit unions (CUs). Some comment has been on the list with
regard to Quebec's Caisse Populair movement. (We have Caisses
also in Manitoba in our French speaking areas.) Indeed, as Ken
has pointed out, CUs are taking over in the rural areas as banks
close down and desert retail banking. I think the figure is 1 in 3
Canadians do their banking at CUs. The reason they were
established in the first place was to provide credit for their
members who were denied loans because they lacked collateral.
Banks would not make loans to people on the basis of their
character, only their wealth. Hence, the people got together to
pool their savings to make such loans and to keep savings within
the local community. (The banks took deposits in the rural areas
and the hinterland regions and made the majority of their loans in
the central financial capitals of Toronto and Montreal.)
Now it is a question that the Banks don't want to be bothered with
retail banking (they are more interested in global operations and
wholesale banking). Most local branches have been converted into
bank machines providing minimal services. This has allowed the
CUs to expand. They have also, at least in Manitoba, refused to
downsize and replace people with machines. Bank fees are less
and profits are returned to members in the form of patronage
payments on loans etc.
CUs have also become involved in community development.
Vancouver City CU (Vancity) is deeply involved in social housing.
In Winnipeg, my local CU (Assiniboine) was taken over by social
activist members over a decade ago and has since been deeply
involved in financing community development in the inner core of
the city, particularly aboriginal co-ops and other such initiatives. It
also supports local, working class cultural and recreational
organizations such as the annual Winnipeg Folk Festival (which is,
I believe, still the largest annual folk festival in North America.)
The point of all this, is to argue that the co-op/CU movement is, in
Polanyi's terms, economy embedded in society rather than
economy dictating to society. That is its raison d'ete, the reason
for its persistance and its (limited) success in competition with the
aggressive forces of capitalism. It is also why I would suggest co-
operative property should not be considered private property as
many writers on property rights do. In any case, decision making
is always on a 'one member, one vote' basis, not on a 'one dollar or
one share, on vote' basis.
Paul Phillips,
Economics,
University of Manitoba
