Encyclopaedia Britannica (11th edition)
“co-operation”
CO-OPERATION, a term used particularly both for a theory of life, and for a system of business, with the general sense of “working together” (con, with, and opus, work). In its narrowest usage it means a combination of individuals to economize by buying in common, or increase their profits by selling in common. In its widest usage it means the creed that life may best be ordered not by the competition of individuals, where each seeks the interest of himself and his family, but by mutual help; by each individual consciously striving for the good of the social body of which he forms part, and the social body in return caring for each individual: “each for all, and all for each” is its accepted motto. Thus it proposes to replace among rational and moral beings the struggle for existence by voluntary combination for life. More or less imperfectly embodying this theory, we have co-operation in the concrete, or “the co-operative movement,” meaning those forms of voluntary association where individuals unite for mutual aid in the production of wealth, which they will devote to common purposes, or share among them upon principles of equity, reason and the common good, agreed upon beforehand. Not that a co-operative society can begin by saying absolutely what those principles in their purity would dictate. It begins with current prices, current rates of wages and interest, current hours of labour, and modifies them as soon as it can wherever they seem least conformable to equity, reason and the common good.
In the industrial world there is everywhere much working together for the production of wealth, but this is not included in co-operation if the shares of those concerned are determined by competition, i.e. by a struggle and the relative ability of each to secure a large share. Nor do co-operators regard the association as truly voluntary, though it may depend on contract, if that contract be one of service only, without an opportunity for all concerned to share in the ultimate control. Co-operation in fact is essentially a democratic association. On the other hand, there is some working together for the production of wealth which without being competitive, or based on service, is not strictly voluntary: thus in primitive societies there is much customary help, combined with customary division of the produce; and in advanced societies we have state and municipal socialism. These are indeed sometimes included in co-operation, but at least they are not voluntary co-operation, since the individual has no choice but to take part in them; they depend on the power of the ruler to coerce the ruled, or of the majority to coerce the minority. In co-operation, meaning voluntary co-operation, there may also, it is true, be frequent overruling of the minority by the majority, but only so far as the minority have, when joining the association, voluntarily agreed to permit, and subject always to an effective ultimate right of secession.
Thus co-operation occupies the middle ground between competition and state or municipal socialism. In its technical sense, however, it does not cover the whole of this ground: it does not cover associations which are primarily for social, provident, or religious purposes, but only those closely connected with the production of wealth. We speak of co-operative societies for agriculture, for manufacturing, for retail, or wholesale distribution, for building or house-owning, for raising capital and so forth; while the great Friendly Societies (q.v.), though a part of co-operation as a theory of life, are not part of the co-operative movement. The line is somewhat hard to draw, and consequently is drawn somewhat arbitrarily. Thus while a society for building, or for the collective ownership of houses, is counted a co-operative society, a Building Society (as we ordinarily understand the term), though it be purely mutual in its basis, is not so counted in Great Britain, but is in the United States (see Building Societies).
For the early history of the co-operative movement we have to look chiefly to Great Britain, and British co-operation acknowledges
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Robert Owen. |
The end of the 18th and the beginning of the 19th centuries were the culminating days of the industrial revolution, when the old organization of domestic industry had given way before the factory system, and the population of the factory districts was suffering a martyrdom, with ruin of body and degradation of character, from unbridled competition, long hours, women's and children's labour, pauper apprenticeship, great fluctuations of trade and employment, dearness and adulteration of provisions, the truck system and insanitary homes. Owen, having himself become a great employer of labour, after starting as a draper's assistant, saw that this was in every sense waste, and that as it paid the manufacturer to have the best machinery and not to overdrive it, but to tend it well and keep it in the best repair, so it would pay him, and abundantly pay the nation, to have the human machines well cared for, not overworked, and kept in the best condition. The popular individualistic philosophy of that day taught that the good of society would be achieved by each individual seeking in his business relations the interest of himself and his family; but Owen maintained that the well-being of the social body could only be served if each individual made that his conscious aim. For this reason he and his disciples were called Socialists. He taught further that a man's character depended mainly upon the circumstances which influenced his life; he emphasized environment, and all but denied heredity. At New Lanark, from 1799, he carried out these ideas among the workers in the cotton mills of which he was managing partner.[1] “For twenty-nine years,” he wrote. “we did without the necessity for magistrates or lawyers; without a single legal punishment; without any known poors' rate; without intemperance or religious animosities. We reduced the hours of labour, well educated all the children from infancy, greatly improved the condition of the adults, diminished their daily labour, paid interest on capital, and cleared upwards of £300,000 of profit.” So wonderful were the results upon the population, that New Lanark became a show-place of world-wide renown, and was visited by many of the greatest and most exalted people of the period.
While thus using his own power Owen not only advocated legislation to limit the hours of factory labour, but appealed to the public authorities to establish industrial communities, where the poor might be set to work, and be managed paternally on the principles of New Lanark. So great was his repute, and so influential the royal and other personages who gave him their support, that this appeal might probably have been successful had not Owen, in reply to complaints as to his religious views — which were deistic — and that his system was not founded on religion, made a public attack upon all accepted religions.
Failing to get the required support from the Government and magistrates, he still sought it from wealthy believers in his teaching, and a number of “communities” (see Communism) were founded in England and Scotland, and in the United States. These were intended to be self-supporting, the land and other means of producing wealth being owned in common, and work and education being regulated on Owen's principles. Owen well knew that most of them lacked the large amount of capital necessary, but his hand was forced by enthusiastic followers, and even the most hopeful of the experiments, that of Queenwood in Hampshire (1839-1844), was made prematurely and failed.
His connexion with New Lanark also came to an end, not from any want of success, but through differences with some of his partners who objected to such matters as dancing, military drill for the children, and the wearing of kilts, but above all feared lest Owen's “infidelity” should undermine the people's faith.
Thus it might have seemed that Owen's life and fortune had been spent in vain, and resulted only in unsuccessful experiments; but this was far from being so. His teaching, and in particular his doctrines of circumstance, and of the conscious seeking after the social good, his belief in self-supporting communities, and his vision of a new moral and industrial world, had powerfully affected the working classes, indeed, all classes. Workmen in many parts of the country had formed groups with the ultimate object of founding self-supporting communities. If the government and the rich would not provide capital enough to start communities, the workers would start them themselves. Thus was the democratic basis given to co-operation. As a means they had been founding co-operative societies, which are sometimes called “union shops” to distinguish them from the later growth of societies of the Rochdale type. The members began by buying provisions wholesale and retailing them to themselves at current prices; the difference became capital, and as soon as possible one member was set to work to make boots and another clothes, and so forth, until ultimately the society should have capital enough to take land and form a community. Education also was prominent among their objects. These co-operative societies reached some 400 or 500 between 1828 and 1834, but the movement then collapsed. As the original enthusiasm died out, or members left the neighbourhood, or capital accumulated in the hands of the original shareholders, they almost all either failed or became private property. In those early days, moreover, the law gave no protection to the property of co-operative societies. This remained so until 1852, when the Christian Socialists (see Socialism) among their many great services to the working classes secured such protection. In 1862 they secured also limited liability for the members.
Before 1844 a co-operative society had already been formed and failed at Rochdale in Lancashire, yet some ardent spirits planned
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Rochdale pioneers. |
The Rochdale Equitable Pioneers began their trading in the smallest way, the members taking turns to serve in the shop; yet where so many other Union shops had failed Rochdale succeeded, and it has steadily grown to an institution with some 14,000 members, doing a trade of £300,000, owning shops and workshops, a library and reading-rooms, making large profits, and devoting a substantial part of them to education and to charitable purposes. What was the reason of this difference? Chiefly it would seem a different method of dealing with the profits. Earlier “Stores” had divided these according to the capital contributed by each member, or else equally among the members: the Rochdale Pioneers determined that, after paying 5% interest on the share capital, all profit should be allotted to the purchasing members in proportion to their purchases, and be capitalized in the name of the member entitled, until his shares amounted to £5. Thus each member found it his interest to purchase at the store and to introduce new purchasers. The ownership of the store remained always with the purchasers, and each came under the magic influence of a little capital saved.
Not only did Rochdale store grow amazingly, but its example spread far and near. New stores were founded on the “Rochdale
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Growth of co-operative stores. |
These workmen's Co-operative Stores,or Distributive Societies, flourish chiefly in the north and midlands of England and in Scotland, but are found more or less all over the country. They, and practically all other British co-operative societies, are registered under the Industrial and Provident Societies Act, which constitutes them corporate bodies, with limited liability, and fixes £200 as the maximum that any member may hold in the share capital. Their government is democratic, based on one vote each, for man or woman; and their members or shareholders, and their committee-men or directors, are almost exclusively the more provident of the working classes, or belong to the class just above. Store societies are of various sizes, from the small village shop to the greatest of them all, the Leeds Society, with nearly 50,000 members, sales exceeding a million and a half sterling, and an elaborate organization of branches and manufacturing departments. Their method, the “Rochdale system,” is as follows, subject to occasional variations. Membership is open to all who pay a shilling entrance fee and sign for a £1 share, which can be paid up out of profit. For the most part members may at any time withdraw their shares in cash at par. A record of each member's purchases is kept by means of metal tokens or otherwise, and at the end of each quarter, after paying a limited interest (never more than 5%, and in very many societies less) on shares, and, in some societies, paying a proportion of profit to the employees, the surplus is divided to the members in proportion to their purchases: non-members also usually receiving half dividends on theirs. Thus the members in effect obtain their necessaries at cost price. The dividend on members' purchases averages about 2s. 6d. in the £. In many successful societies even more is paid, but the average is falling. Where dividend is high, prices are often fixed above those current in the neighbourhood, so that the members, in addition to saving the retailer's profit, use their Society as a sort of savings bank, where they put away a halfpenny or so for every shilling they spend. In addition to retailing, a store often manufactures bread, clothes, boots and millinery, sometimes farms land, or grinds corn; usually for its own members only, but occasionally for sale to other societies also. Their productions in this way exceed £5,000,000 a year. They also invest large and increasing sums in building cottages, to let or sell to their members; and they lend still more largely to their members, to enable them to buy cottages.
Outwardly these stores may look like mere shops, but they are really much more. First, they are managed with a view not to a proprietor's profit, but to cheap and good commodities. Secondly they have done an immense work for thrift and the material prosperity of the working classes, and as teachers of business and self-government. But further, they have a distinct social and economic aim, namely, to correct the present inequalities of wealth, and substitute for the competitive system an industry controlled by all in the common interest, and distributing on principles of equity and reason, mutually agreed on, the wealth produced. With this view they acknowledge the duties of fair pay and good conditions for their own employees, and of not buying goods made under bad conditions. The best societies further set aside a small proportion of their profits for educational purposes, including concerts, social gatherings, classes, lectures, reading-rooms and libraries, and often make grants to causes with which they sympathize. Their members are prominent in local government affairs; co-operative candidates are occasionally run for town councils, and often talked of for parliament. Though the societies are non-political, and have refused to join the labour representation movement, they are usually centres of “progressive” ideas. There are of course many defects, and of their two million members a large, and many fear an increasing, proportion, attracted by the prosperity of the societies, think chiefly of what they themselves gain; but the government of the movement has, hitherto at least, been largely in the hands of men of ideas, who believe that stores are but a step to co-operative production, and on to the “co-operative commonwealth.”
It is indeed only when we come to federations of co-operative societies, and above all to production, with its large number of employees, that the educational side of the movement and its power to promote industrial reform are most seen. The Co-operative Union, Limited, for instance, is a propagandist federation of all the chief co-operative societies in Great Britain, and some in Ireland. Its income of £10,000 a year is contributed by the Co-operative Societies. It looks after their legal and parliamentary interests, carries on much educational work by means of literature, lectures, classes, scholarships, summer meetings at the universities, and so on; organizes numerous local conferences for discussion, and once a year a great national co-operative congress, and exhibition of productions, in some chief centre of population. The Co-operative Wholesale Society, Limited, is a trading federation of the great majority of the English stores. Founded in 1863 on a small scale, it now counts its employees by thousands, its capital by millions, and its yearly sales by tens of millions. Besides its merchant trade, it manufactures to the value of £4,500,000, owning factories, warehouses and land in many districts. It imports largely, and runs its own steamships. It is also the bank of the co-operative societies, and the chief outlet for the always redundant capital of the well-established stores. The Scottish stores also have their Wholesale Society, not less important relatively. For many purposes these two are in partnership. In each of them the net profits are returned to the stores as a dividend on purchases, and thence to the whole body of members; but in the Scottish Wholesale a part is also paid to its employees as a dividend upon their wages. There are also a few local federations of stores, mostly for corn-milling and baking.
Strongly contrasting with this production by associations of consumers, or “consumers' production,” is the co-partnership, or
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We constantly hear that co-operative production is a failure. There have no doubt been failures, especially of big experiments
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Rival theories. |
On the working-out of these two principles depends the future of co-operation. The example of Scotland probably throws light on the problem. There co-operative production, amounting to some millions sterling, is nearly all carried on by federations of consumers' societies, including the Scottish Wholesale, which apply more or less successfully the co-partnership principle — i.e. their employees are admitted to share in profits, and may become members, whereby they are further admitted to share in capital and control. The type of organization hence resulting is very much the same as where a society of producers admits consumers' societies to membership, and sets aside a proportion of the profits to be returned to them as dividend upon their purchases. To this combined type, we have seen, English productive societies, started by producers, have come; and it would appear that those started by consumers must ultimately tend to it. However, in spite of honoured leaders of the early days, the consumers' party is at present greatly in the ascendant in English co-operation, and even in the Scottish federations it is almost strong enough to abolish co-partnership, and allow no one to share in capital, profit or control except in his capacity as a consumer.
An association of co-operative societies and individuals, called the Labour Co-partnership Association, exists to maintain the principle of co-partnership in co-operation, and also to promote its gradual adoption in ordinary businesses. Some progress in this latter direction is being made, there being a tendency to improve upon simple profit-sharing by capitalizing the workman's “bonus,” whereby he becomes a shareholder, and the business is gradually modified in a co-operative direction. There are remarkable instances of such modification abroad, notably that of the great iron foundry and Familistère at Guise in France. The most noteworthy, among several, in England is that of the South Metropolitan Gas Company, where after eighteen years of the system 5000 odd employees had in 1907 more than £320,000 invested in the company; they also elect three of themselves directors of the company, this being one-third of the board. Unfortunately this example is, or at least was, marred by a feud with the trade unions, whereas there is friendship between trade unionism and co-partnership, as indeed between trade unionism and co-operation generally.
One of the most recent and promising developments of English co-operation is the tenants' co-partnership movement for the
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Tenants' co-partnership societies. |
Such, then, are the history and present extent of co-operation in Great Britain. Turning abroad we find in almost all civilized
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The movement outside Britain. |
Confusion has sometimes arisen from the fact that while Rochdale Co-operation sets itself against “credit,” continental
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Germany and credit co-operation. |
Just as with co-operation in labour and in purchase, so mutual help in obtaining credit may doubtless be traced in primitive forms far back into history. It was certainly more or less “in the air” in Germany and France about 1848 and even earlier; but the beginning of systematic organized credit co-operation may be definitely fixed in the year 1849, when Raiffeisen began his Darlehnscasse, or loan bank, in Rhenish Prussia. Curiously enough it had also a second and entirely independent origin. For in the following year Schulze-Delitzsch, in a distant part of the same kingdom, established his Credit Society based on an entirely different system. As this second system spread much more rapidly than the other and attained, as indeed it retains, much greater commercial magnitude, it came to be regarded as the beginning of credit co-operation, of which for a long time it was the only important form. These two remain the two distinct types in every land. Thus Germany, which has innumerable co-operative societies of every form and of great importance, is in particular the mother of credit co-operation.
In the famine years of 1846 and 1847 and for some years after, Friedrich Wilhelm Raiffeisen was a burgomaster in the barren
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Raiffeisen loan banks. |
Such a bank is essentially an association of neighbours. Besides borrowing, it also receives savings deposits, which often produce a large part of, or even all, the capital it needs. Usually a few of the members are comparatively well to do people, who join to help their neighbours by increasing the society's credit. This Raiffeisen considered essential. They have no actual privilege, but by common consent they take a leading part. In the true Raiffeisen bank the liability of each member is unlimited, but limited liability has been introduced in some of its modifications. The Society confines its operations strictly to a small area, say a parish, where everyone knows everyone. Each borrower must specify the purpose for which he wants a loan, say to buy a cow or drain a field, or pay off a money-lender, and this is rigorously inquired into. Only members can borrow. Any member, however poor, can borrow for a profitable approved purpose, and no one, however rich, for any other. Practically all the members see that the money is applied as agreed; and, while the loan is often made for a long period, a year or two — even for ten or more — so as to repay itself out of the profit, power is reserved to call it in at short notice if misapplied. Loans are repayable by periodical instalments, but repayments must be made with absolute punctuality. No bills, mortgages or other securities are taken, except a note of hand either alone or with one or two sureties. There are two committees, one to lend and do the work of the society, and the other to supervise the first; and on both of these it is understood that the richer members are to be in a majority. No committeeman or officer receives any remuneration for his services, except that the accountant gets a small salary. Originally there were no shares, and when in 1889 the legislature ordained that there must be shares, the Raiffeisen banks made theirs as small as possible, generally ten or twelve shillings. Nothing is paid on the shares as interest or dividend, all profit being voted once for all to the ordinary reserve and the indivisible reserve, the latter the backbone of the system. In every large district the Raiffeisen banks are federated in a Union, and these Unions culminate in a General Agency. As an intermediary among themselves, and between them and the money market, the banks have also a central bank with a capital of £500,000, and with ten provincial branches. A great deal of agricultural co-operation has arisen from these banks as centres, and with the money they have supplied.
Raiffeisen banks boast that neither member nor creditor has ever lost a penny by them, and while this is denied it seems at least near the truth. Their credit is so good that they can obtain money at very low rates, and as their expenses are trifling they can re-lend to their members at rates but little higher. In Germany they usually lend at about 5%. Only men of good character can obtain membership: thus, besides spreading prosperity, they have everywhere been great promoters of sobriety and good conduct. They were only intended to meet the needs of the peasants, especially of the very poorest, and for this purpose they have proved admirably suited.
Very different were the people among whom Schulze-Delitzsch established his form of co-operative credit; and very different
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Schulze- Delitzsch banks. |
In a Schulze-Delitzsch bank, a number of such men combine together to raise a capital of guarantee: to do this every member takes up one share and one only, which is of large value, say £30 or £50 or even much more, but can be paid up by small instalments. Thus every member is committed to a long course of saving. On the strength of this capital in course of formation, and the unlimited liability of the members, the bank is able to borrow, or to receive as savings and deposits from members and others, a much larger capital. The funds so constituted it lends out at the highest rates it can command, originally 12% or 14%, but now very much less, and varying, of course, with the market. It lends to members only, but to any amount, for any purpose and on any good and sufficient security, whether acceptance, promissory note, overdraft, discount, mortgage, pledge, surety or what not. The loans, however, are always for a short period, usually three months, renewable for another three months, and sometimes further than that. The committee of management are elected by the general meetings; they decide on all loans, and receive a salary, plus a commission on the business done. The council of supervision are also paid, or at least entitled to pay. The great objects which a bank keeps in view are security and a good return on capital. It is not confined to a small area, but works for as large and as varied a constituency as possible. With such a constitution the Schulze-Delitzsch banks grow big and accumulate a large capital of their own. On an average each bank has nearly 600 members, and lends about £150,000 per annum, including loans renewed. Losses are sometimes made, but they are not heavy on the whole. All the profits are divided upon capital, or put to reserve, except some, usually small, sums given to charitable or educational purposes. Dividends average about 5%, but have been known to reach and even exceed 30%.
It may therefore justly be said that for co-operative institutions these banks smack too much of joint-stockism: they are in fact co-operative not much more than in the same sense that the Oldham cotton mills, and other “working-class limiteds,” have sometimes been loosely called co-operative. They seem constituted to make the lender's interest supreme, but they have, nevertheless, conferred enormous benefits on the handicraftsmen, small traders, small cultivators and others who borrow from them. They have put capital within their reach at reasonable rates.
These banks also have their central point. In 1864 the German Co-operative Societies' Bank was founded to centralize the work of the local Schulze-Delitzsch banks and to bring the money market within their reach. It was not itself co-operative, and never confined its business to the co-operative banks. Beginning in a very small way, by 1903 it had attained a capital of a million and a half sterling and a yearly business of £154,000,000, of which £28,000,000 was specifically with co-operative credit societies. It was then amalgamated with another banking business, the Dresdner Bank, esteemed one of the most important and successful in Germany.
Thus these two types of credit co-operation agree in being founded on unlimited liability, but speaking broadly they are contrasted in that the Schulze-Delitzsch banks work primarily, though by no means solely, among townsmen, are based on share capital, work for profit, which they divide on shares, are conducted by paid directors, and confer their benefits not on the very poorest but rather, as their own friends say, on the middle classes: the Raiffeisen banks are designed for the peasantry, are not based upon share capital, neither divide, nor work for, profit, are conducted by unpaid directors, and confer their benefits especially on the very poor. The Schulze-Delitzsch type is strong in self-help, but tends to commercialism as it grows; the other needs the help of the well-to-do to back up the self-help of the poor, but it tends to altruism and the union of classes.
The world has 30,000 co-operative credit societies, not counting building societies; and though they are organized in many groups, especially in their native Germany, for local reasons, or because of some modification, or some compromise between the two systems, the two types really include them all. There is, however, a strong tendency to introduce limited liability into various offshoots of the one type and the other; even into the orthodox Schulze-Delitzsch banks themselves, when they grow big. From Germany co-operative banks have spread into almost all European countries — even at last to Ireland and England — and to America and Asia. In Germany there are some fifteen thousand local, and no less than sixty central, co-operative credit associations, which lend out £180,000,000 a year including renewals. In Italy, Austria and Hungary they are also strong. In 1896 it was estimated that £150,000,000 a year must be very well within the total amount lent by money co-operation on the continent of Europe; eight years later it could not well fall short of £250,000,000, and the amount keeps constantly increasing. Of this total only a small percentage represents loans by banks of the Raiffeisen type, which, though very numerous, often lend only a few hundred pounds each in the year.
Great controversy has prevailed as to the state subsidies given to co-operative credit. While governments are sometimes rather inclined to hinder co-operative distribution, they have shown a marked tendency to foster, whether for political or economic reasons, co-operative credit. The Prussian government in response to popular demand, vigorously supported by the agricultural interest, has founded and endowed with £2,500,000 of public money, the Central Co-operative Bank, whose object is to bring capital within the reach of the various groups of co-operative banks. The Schulze-Delitzsch Union was the only one to dispute the need of this, and though the bank has given a stimulus to the formation of co-operative societies, it still denies that this is a healthy propagation. Nevertheless, some even of the Schulze-Delitzsch societies resort to this state bank for money, it is under government administration and lends immense sums each year. In France the Bank of France has been compelled to lend £1,600,000 free of interest, and to give about £120,000 per annum out of its profits to assist agriculture; this money is being lent free to “regional” banks, and by them at about 3% to local societies. State help has also been given to the co-operative bank of the French workmen's productive societies. In Austria and in many other countries a great deal of similar help has been given.
Closely connected with certain developments of credit, and deserving to rank as the third, if not the second, great subdivision
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Denmark and agricultural co-operation. |
At almost every point agricultural and credit co-operation touch; yet the most perfect example of agricultural co-operation is not concerned with credit co-operation in any form. The farmers of Denmark practise co-operation in almost every variety, except for raising capital. The commercial banks have provided money to start dairies and other co-operative societies; so that, it would appear, the need of credit co-operation has not been felt.
The Danish farmer is almost always a freeholder: it is little more than a century since his ancestors were serfs. It is little more than a generation since a few men, turning to account the strong national feeling aroused by the defeat of 1864, started a great educational movement which has left its mark on all strata of Danish society. After the People's High School, technical schools arose in various places; and to these, and to the excellent continuation schools in the country districts, the Danes are beholden for the regeneration of their agriculture. From 1867 co-operative distributive societies on the Rochdale plan had been spreading in Denmark; but it was not till 1882 that co-operation in agriculture began, and the first co-operative dairy was formed; ten years later there were about a thousand such, a number which has slightly increased since. These dairies are productive societies in which the cow-owners are the shareholders, and all shareholders have equal rights and equal voting power, whether they own one cow or one hundred. Almost every village has its co-operative dairy, fitted to deal with the milk of from 400 to 1400, or even 2000 cows. They far exceed all the other dairies of Denmark. More than four-fifths of all the milk of Denmark is used in them, and they produce butter worth more than nine millions sterling. The profits are divided among those who supply the cream, in proportion to the value of their supplies — a method of dividing profits characteristic of agricultural co-operation. The village dairies are united in federations to export their produce.
Side by side with the dairies are other co-operative societies, quite independent but largely composed of the same members, for buying collectively fodder, manures and other agricultural or household requisites, for collecting and exporting eggs, slaughtering hogs and curing bacon, improving the breed of stock, for bee-keeping, fruit-growing and so forth. By means of these societies the country has been greatly enriched. The farmer not uncommonly belongs to ten co-operative societies, besides probably a farmers' club. The work of starting and administrating the societies is seldom paid, and many farmers give much time to it gratuitously. They are in the main organized on the same principles as the dairies, but with variations; the largest egg export society, for instance, has over 30,000 members. It is not a federation of village societies, but a centralized body with many branches.
The growth of the bacon-curing societies has been remarkable. The first of them was not founded until 1887, but they spread rapidly, and in seven years there were twenty, killing more than half the country's then produce of hogs. The movement has greatly increased since then, and multiplied its output about fourfold. Co-operation in collecting, grading and exporting eggs only began in 1895, and in eight years 65,000 members had joined the various egg societies, and the value of eggs exported had reached £436,000. Taken as a whole, the effect of agricultural co-operation in Denmark has amounted to little less than a revolution. It has brought the results of science within the peasant's reach, and he has been quick to avail himself of them: it has transformed a great part of farm work into a factory industry, increased the yield of the soil, improved the material position of the peasants, and drawn rich and poor together. Denmark, once so poor, is now, except England, probably the richest country in Europe in proportion to its population. Besides Denmark, Germany, France, Italy, Belgium, Holland, Finland, Australia, New Zealand, the United States, Canada, Ireland and many other countries have important developments of agricultural co-operation. In Germany, where it is closely connected with credit co-operation, it seems to date from 1866 only, yet in forty years agricultural co-operative societies have come to number six thousand, without counting the agricultural banks, which exceed twice that number. There are dairies, societies to purchase farm requisites, societies of grape-growers, hop-growers and beetroot-growers, distilleries, labour societies, insurance societies, societies to own warehouses and granaries and to sell produce, to purchase land and resell it in small holdings, and even several societies which purchase land to cultivate it in common. The close connexion between credit-societies and other agricultural co-operation is exemplified in the Central Union of orthodox Raiffeisen credit societies at Neuwied. Through a central bank and a trading department allied to it, it has negotiated the joint purchase of coal, feeding-stuffs, manures, machinery and so forth to large amounts, as well as the difficult business of the combined sale of agricultural produce. Moreover, several local centres connected with this union have granaries and warehouses for the storage of agricultural produce, and negotiate joint sales, while within the union facilities have been found for selling the products of one district to members in another.
In Ireland stores have not hitherto flourished, though a few exist. Irish co-operation is agricultural, and dates from the
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Irish agriculture. |
In France, which Englishmen are apt to speak of as preeminently the country of co-operative production, the agricultural
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Co-operative agriculture in France and other countries. |
Everywhere the main features of this agricultural movement are similar to those we have seen in Denmark and Ireland; it is supplementary to individual cultivation; hardly ever does it appear as associations for cultivating in common, and, speaking with certain important exceptions, it has no very ideal aims, but seeks chiefly to give the farmer a better profit. In England there are a number of farms worked by stores, and several large associations for the supply of farm requisites; but the typical agricultural co-operation, based on small village societies and federations of such societies, has only recently been made known and begun to take root.
It is notable that while the Syndicats agricoles are almost exactly what Fourier, the Robert Owen of France, foresaw as the next stage of social development, the other great branch of French co-operation, the workshop movement of the Associations ouvrières de production, is directly due to his teaching, which led in 1848 to the starting of a large number of co-operative
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France and co-operative production. |
It has been objected that their growth is artificial inasmuch as the government gives them certain advantages, such as preference over the private contractor at an equal price, exemption from the deposit of security, and special concessions as to payments on account. It also grants a subvention (recently about £7000 per annum), which was formerly all given to the societies in grants, but is now largely lent to them at not more than 2% interest through their own special bank. This bank was founded in 1893 to help the societies with loans and discounts, and was soon after endowed by a disciple of Fourier with £20,000. The societies have also benefited by other private beneficence and public help. As to the Government aid, it must be remembered that in France the state helps all forms of industry in ways unknown to us, and the French co-operative producers always declare that what is done for them is a trifle compared to what is done for other manufacturers. Moreover, they get many large contracts in open and unaided competition. In these societies the auxiliaires, or workers who are not members, are often numerous; but no society is now admitted to their federation which does not share profits with the auxiliaires and facilitate their admission to membership.
Consumers' co-operation, credit co-operation, agricultural co-operation, and workshop co-operation, as exemplified in Great Britain, Germany, Denmark and France, are found in most advanced countries, some in one and some in another, in forms roughly similar to those above described. Of co-operation for production it might have been said, a few years ago, that outside Great Britain it everywhere meant associations of producers. Except bakeries, there was but little consumers' production; that, however, seems now to be spreading in foreign countries also. The most important developments of co-operation not yet described are the socialist co-operation of Belgium, the co-operative building societies of the United States, the labour societies of Italy and Russia, the co-operation of German craftsmen to provide themselves with raw material, and the letting out of railway construction to temporary co-operative groups of workmen by the New Zealand and Victorian governments.
In Belgium co-operation is mostly socialist in the towns and Catholic in the country. In all the principal industrial centres are very important co-operative bakeries and distributive societies, owned by co-operative groups, numbering thousands of workmen of every calling. These Maisons du peuple are admitted to be well managed, even by those who dislike their politics. The socialist party look upon them chiefly as a means of organizing and educating the working classes for political and economic emancipation, and of providing funds for political warfare. Like the English stores, and allied societies, they are based on the consumer, but unlike them they pay no interest on share capital, though they do on deposits. A much larger part of the profit than in England is devoted to propaganda and common purposes, though a part is also paid to the consumers individually in the form of checks exchangeable for bread or other goods. The workers employed also receive a share of profit as a dividend on their wages, and elect their representatives on the committee of management. By means of these societies the party has a press, buildings, and the funds to fight elections and support members in parliament. In France, where the store movement has been of an individualistic, and often middle class, tendency, the socialists have lately imitated the example of Belgium, and seem to be winning more success than the older French stores.
In the United States there has long been much important agricultural co-operation, and there have been many much-advertised attempts to establish Rochdale co-operation, but there have so often been failures and even dishonesties that co-operation has had a bad odour in the country, and the developments come and go with such rapidity that it is difficult to speak with confidence of its stability. The branch of co-operation which has been a great success in the United States consists of the great co-operative building societies, but building societies are not considered part of the co-operative movement in Great Britain.
Co-operation of all kinds is greatly developed in Italy, but one form is specially notable. The Società di lavoro are co-operative labour gangs of great importance. They are counted by hundreds, and are found among navvies, builders, masons, carriers, stevedores, agricultural labourers and other workmen, and have carried out very great works in Italy and in foreign countries. They have, for instance, drained lands in the Campagna and made a railway in Greece. They differ from productive societies markedly in that they have comparatively little to do with capital or material, but contract mainly for labour.
The Slavonic races seem to have a special aptitude for grouping together co-operatively: it is said that men meeting casually on a journey will do so for the brief time they are together. In countries like Servia we see this ancient, and more or less customary, loose and unstable co-operation meeting the modern contractual, permanent co-operation of banks and other registered societies. So in Russia, where so large a part in the national organization is played by the Artel (see Russia), which may be a transitory co-operative group of workmen undertaking a particular piece of work, e.g. to build a house, or a permanent association like that of the bank porters combined together to guarantee one another's honesty.
While English and some other forms of co-operation have always repudiated state help, and probably rightly, so far as
| State help. |
We have now surveyed co-operation in its chief forms and in some of the countries where it is chiefly found. Some years ago
| Conclusion. |
Bibliography. — International Co-operative Alliance, International Co-operative Bibliography (London, 1906); G. J. Holyoake, History of Co-operation (London, 1875-1879, new ed., 1906), History of the Rochdale Pioneers (London, 1893, new ed., 1900), Self-Help a Hundred Years Ago (London, 3rd ed., 1891), Co-operative Movement of To-day (London, 1891, new ed., 1896); Lloyd Jones, Life and Times and Labours of Robert Owen (London, 1890, new ed., 1895); F. Podmore, Robert Owen (London, 1906); E. T. Craig, History of Ralahine (London, 1882, new ed., 1893); Thomas Hughes and E. V. Neale, A Manual for Co-operators (Manchester, 1881, 1888); Catherine Webb (editor), Industrial Co-operation (Manchester, 1904); Beatrice Potter (Mrs Sidney Webb), Co-operative Movement in Great Britain (London, 1891, 1893, 1904); A. H. D. Acland and B. Jones, Working Men Co-operators (1898); Benjamin Jones, Co-operative Production (London, 1894); C. R. Fay, Co-operation at Home and Abroad (London, 1908); H. D. Lloyd, Labour Co-partnership (London and New York, 1898); D. F. Schloss, Methods of Industrial Remuneration (London, 2nd ed., 1894); N. P. Gilman, Profit Sharing (London, 1892); C. Robert, Guide pratique de la participation (Paris, 1892); Aneurin Williams, Twenty-eight Years of Co-partnership at Guise (Letchworth, 1908), Relations of Co-operative Movement to National and International Commerce (Manchester, 1896); Dallet-Fabre-Prudhommeaux, Le Familistère illustré (Paris, 1901); Bernadot, Le Familistère de Guise (Guise, 1892); E. O. Greening, The Co-operative Traveller Abroad (London, 1888); H. W. Wolff, People's Banks (London, 1893, 1896), Co-operative Banking, its Principles and Practice, with a chapter on Co-operative Mortgage Credit (London, 1907); de Rocquigny, La Co-opération de production dans l'agriculture (Paris, 1896); Merlin, Les Associations ouvrières et patronales, &c. (Paris, 1900); Mabilleau and others, La Prévoyance sociale en Italie (Paris, 1898); Fr. Müller, Wesen, Grundsätze und Nutzen der Consumvereine (Basel, 1900). See also the annual Reports of the Government Labour Departments, and the Monthly Bulletin of the Internat. Co-op. Alliance.
[1] Holyoake, History of Co-operation (1906 edition), i. 34.