Cooperatives: A new moment for an old idea?

The Trump era in the US has triggered a lot of angst over the state of our democracy. A lot of blame flies around these days, as well as concern for our civil discourse. New efforts to understand, restore, and strengthen democratic institutions and the social capital that undergirds them are emerging regularly. At the same time, there is a lot of talk about growing economic inequality, with different opinions on how to address it, from changing the tax code to raising the minimum wage to breaking up companies.

Where there is recognition that these two problems—economic inequality and democratic decline—may be linked, the call to action often points to campaign finance reform, an idea that never seems to make enough headway, or more regulation of the economy, an idea that comes and goes depending on who holds political power. But what if the link is more existential than political? If our democracy has weakened because non-democratic manifestations of capitalism have metastasized across our economy, then campaign finance reform and regulation are essential but may not address the root of the problem. And creating places for dialogue across difference, also essential, cannot on its own achieve a more equal, harmonious, and democratic society.

Could one solution lie in the centuries old concept of cooperatives—shared ownership/management organizations for workers, producers, or consumers—renewed for the modern era? An article in Fast Company explores this question, discussing a book published last year by Nathan Schneider, Everything for Everyone: The Radical Tradition that Is Shaping the Next Economy.

Whether you’re conservative or liberal, the idea that you would extend democracy into the economy just seems like a no-brainer.
— Nathan Schneider

Both the article and book feature the growing consumer cooperative, Community Purchasing Alliance (CPA), which has its origins in the Washington, DC, faith community. CPA emerged out of the Washington Interfaith Network, a community organizing group funded in part by member congregations. Reviewing congregational budgets revealed the high price faith institutions were paying for utilities, so CPA was created to bring congregations together to negotiate bulk prices. It has since expanded beyond utilities to other building maintenance contracts, beyond faith institutions to charter schools and other local non-profit organizations, and beyond DC to North Carolina. CPA also helps member institutions move into solar energy and uses its purchasing power to support minority-owned companies.

With the cooperative such an old concept—the cooperative movement dating back to the 18th century, with earlier conceptual roots in Christian monasticism—it’s hardly a new innovation. It’s also far more prevalent than we often realize. As of 2012, one billion people globally were members of cooperatives, and as of 2016, the top 300 cooperatives globally had turnover of over $2 trillion. In an era when social capital is declining and democracy feels threatened, while at the same time, a handful of companies dominate the economy, perhaps it’s worth bolstering a movement that democratizes economic power while strengthening cooperation in our communities.

The innovation lies in how to adapt it to today’s economic and social realities and leverage today’s economic and social opportunities to make it a viable option for more and more businesses. To do so, we should focus not only on the problems of our time, but its bright spots as well. This is also an era of ubiquitous start-ups (creating a business has never been easier) and a cultural re-thinking of the role of business for social good. What better way for business to do good than to drive more equitable wealth creation, rather than wealth accumulation for a few. Perhaps in the midst of the particular societal problems and advantages here in the 21st century, a new moment for the cooperative has arrived.

[Community Purchasing Alliance is] not ‘disrupting’ anything around it, but rather solidifying bonds across a community that the mainstream economy often fails. That, to Schneider, is the true power of cooperative models.
— Eillie Anzilotti in "Why the cooperative model needs to be at the heart of our new economy," Fast Company

We also recommend this Religion News Service article about Blue Tin Production, a new clothing cooperative run by immigrant and refugee women producing ethical fashion for the Muslim community.

And for information or support in converting a business to employee ownership, check out Project Equity.

Photo by Randy Colas on Unsplash