Production vs Consumer Cooperativism
= debate between Natalia Fernandez of lasindias.net and Robin Murray, expert on cooperativism in the UK
Natalia Fernandez
Key thesis:
- By severing cooperativism from its communal origins and and focusing on consumption, British cooperativism … caused lasting damage to the transformative capacity of cooperativism, which we should not repeat today in the debate between the economy of the commons and collaborative consumption.
Excerpted from Natalia Fernández:
(version without links)
“A “School of Sharing Economics,” or a “School of Economics of the Commons?” A “School of the economic theory of collaborative consumption,” or a “School of the economic theory of the commons?” You could argue that, really, they’re two sides of the same thing: the emerging forms of capital (the commons) and consumption of the P2P mode of production. But they open two different worlds.
One of the narratives that has done the most damage to the mutualist tradition is making the starting point for the History of Cooperativism the birth of modern consumer cooperativism, the famous “Rochdale Pioneers” of 1844. This overlooks pre-existing and very widespread communally-based social organizations which, at that time, had already been around (in some cases) for fifty years, and had become agrarian and worker cooperatives. This narrative, which continues to be the official line of the International Cooperative Alliance, and which we still find on Wikipedia, diverges from cooperativism of the commons.
It wasn’t an innocent narrative or simply erroneous. In the early continental cooperative world, mutualism, cooperativism, and later, Catholic social doctrine, located the key to the “social problem” in production, and were able to offer a continuity between the resistance to the deamortization of the communal carried out by the liberals and the alternatives to flourishing industrial capitalism. However, in Great Britain, it was Anglican Liberals and Social Christians who, following the Owenite tradition, led the birth of the First British Co-operative Congress. For them, focusing on consumption was a way to confront the growing radicalization of the workers’ movement and “contamination” by “continental ideas.” That’s why they attribute the origins of cooperativism to Robert Owens, a liberal philanthropist, and date the birth of cooperativism to the Rochdale Pioneers (consumer cooperativism).
In 1895, after many difficulties caused by their interest in including traditional capitalist businesses, Neal, Wolff and Holyoyake managed to pull off the first assembly of the International Cooperative Alliance. It goes without saying that attendees were mostly British: along with Great Britain, most delegates came from Australia, India and Ireland, it was considered a great success to include German Christian cooperativism and its circle of influence. In other words, there was a clear Social Chrisian hegemony. That’s why they made an “apolitical” approach one of the bases of the movement, which left out most of European cooperativism, which was tied to the Catholic parties, the socialist parties, or libertarian syndicalism.
Without a doubt, it was a political masterstroke… for the English Social Christians. However, the damage is visible today: cooperativism, broadly speaking, does not recognize itself in the commons… even though the commons is the primary value of its origins and the primary path to its future.
Will we make the same mistakes?
Today, we face a similar dilemma. The tradition of Anglo-Saxon social criticism understands economic democracy as a sort of “consumer democracy” and from that point of view, “collaborative consumption,” the “sharing economy,” would be the defining center of the evolution of the mode of production beyond industrial capitalism.
But, in the end, a mutual insurance company doesn’t transform economic relationships if it isn’t part of, and subject to, a broader democratic community where most of the weight necessarily falls on worker co-ops. A good part of the insurers in Europe and the U.S. are mutuals, which is to say, consumer co-ops… but most of the members don’t even know they are part of a cooperative structure.
A similar thing is happening with the practices of the “sharing economy.” Collaborative consumption is not part of the transition towards a P2P mode of production if it’s not within the framework of the development of the communal, and P2P production, just as consumer cooperativism doesn’t generate a democratic economy if it’s not part of a cooperative industrial community.
By severing cooperativism from its communal origins and and focusing on consumption, British cooperativism and the ICA caused lasting damage to the transformative capacity of cooperativism, which we should not repeat today in the debate between the economy of the commons and collaborative consumption. That’s why, when we talk about developing an economic and social theory that explains and drives the transition away from the forms of production in which we live, we should not repeat the mistake. Let’s build a “Somewhere School for the Economics of Commons“ that serves whoever wants to learn to do, and caters to whoever wants to research.” (http://english.lasindias.com/production-not-consumption-economics-of-the-commons-not-sharing-economics/)
Robin Murray
Personal contribution via email:
"First, I don’t know when the concept of consumer co-operation first appears, but what strikes me about Rochdale and the early retail societies is that they started a shop as a way into much wider vision of an alternative economy. Before Rochdale, there had been all sorts of experiments – of Owenite communities, of what we might now call production co-operatives, as well as collaborative purchasing. The Owenite alternatives were examples of commoning – but they didn’t last. Some of the first Rochdalers were Owenites and had been involved in Owenite schemes. But one of the reasons they persuaded their Chartist and Trade Union friends to have another go at joint purchasing, was that it could be got going on a small scale without the kind of capital needed by the Owenite projects – and that if it worked – it would open up a path to co-operative production, land-holding, housing, education, and so on.
And the great point about Rochdale is that it was one of these innumerable experiments that worked. It did just what those early pioneers had hoped. Starting small (oatmeal and bacon) they were able to grow bit by bit according to their own resources. The profits made were mostly distributed as dividends, but many of these dividends were kept in the co-ops as savings, and this provided the capital to expand the number of stores, the products offered in the stores, as well as production for the stores . Within a decade the societies were also buying land, establishing their own farms, and building a remarkable quantity of housing. Once the joint wholesale Society (CWS) was established in 1863, it was a short step to the extraordinary expansion of production. By the end of the century the CWS had something like 180 factories, and its great driving force, J.T.W.Mitchell had a vision of creating an entire alternative economy to that of capitalism, with its own production, finance, insurance, shops, libraries, funeral services and so on. What a vision it was.
One of the great arguments was whether there should be a measure of worker ownership in the production units (and indeed in the shops). Mitchell argued that the surplus should be channelled to the workers and their families at the point of purchase – in this sense it was ‘consumer’ oriented. This included surpluses generated at the wholesale level. I suspect that to him and those favouring that position this was more ‘universal’ in terms of the Co-operative Commonwealth. Those who argued against this favoured a co-partnership model, that was mid way between self governing workshops and the retail societies. The argument was not one about consumption versus production. Both parties were deeply into co-operative production. It was rather about the way in which surplus realised in the co-operative economy was distributed and controlled.
The self-governing workshops were another strand of co-operation that run alongside the growth of the Rochdale model. Many failed, but by no means all. And the CWS did buy from them. But they didn’t have the same power of internal accumulation that the Rochdale model had stumbled upon. By 1880 there were only 15 productive societies still standing. They expanded in number in the following twenty years, but remained a limited part of the movement – not so much through ideology as through their survivability.
This then is the first point. The so called consumer co-operatives were deeply involved in production. The second point is that retail/wholesale should not be counterposed to manufacturing. Both depend on each other. For the Rochdalers, the shops were the platform for launching backwards into manufacturing and farming. For the co-operative workshops they developed their own wholesalers to find outlets in addition to those available through co-operative distribution. This is one of the thing I have learn from our fair trade ventures. They work in the sphere of distribution and in some cases retailing, but their purpose is to provide outlets for producer co-operatives of small farmers. Co-operative systems are about integrating not separating these spheres.
Third, retailing/wholesaling is itself production. It requires labour, capital, land, organisation, accounting. The history of 19th century English, Scottish and Welsh retail co-operation is a history of working people completing outpacing their private rivals in this sphere of the economy. The question is why were they able to do this in a way that the workshops of shoe makers, weavers, metal trades, printers, building and wood workers were not.
In my view it was because in retail and distribution the distributed system of retail connected together by ideology and common institutions (in the Ostrom sense) was one that private capital did not have the channels of information and communication to exert capitalist control at a national level. The co-operative retailers were then able to source (and produce) their primary inputs at a scale that non other retailer could match. You could say that it was an organisational innovation that made the CWS and the retail societies one of the largest ‘corporations’ in the world by the 1890s. The small worker owned shoemakers could not establish such an advantage in their sphere.
Last is the question of class. Robert Owen was a manufacturer and his projects were archetypal ‘commons’ projects, centred round self production. Interestingly the Christian Socialists mentioned by Natalia were the great protagonists of self governing workshops and of worker co-operatives more generally. The Rochdale pioneers and the main organisers were industrial and mining workers . J.T.W.Mitchell was the son of a very poor single mum, who worked at various jobs in the textile trade, and was formed by Congregationalism. Holyoake could be said to be middle class, but he was the scribe of the movement not its progenitor. The English movement was very different in this case from the German co-operative banking movements, which were not only initiated by middle class philanthropists, but often were administered locally by the pastor and schoolmaster, and what would later have been termed ‘rich peasants’ (the Irish credit unions collapsed by the early 1930s because they had a different rural class base).
I think we should approach this issue as an emergent system – and understand what emerged and why it worked. I don’t think it can be reduced to a battle between consumerism versus productionism either ideologically or above all in practice."