It occurs occasionally that someone outside of a problem will have an insight that escaped those who are focused on finding a solution. This phenomenon has achieved the unenviable status of a phenomenon that can be commoditized by the Consultancy Industry, even if the insights produced for the fee fail.
More remarkable are those occurrences when an observer of social relations discovers what’s hidden in plain view. This is the case with Bernard Harcourt and his new book on Cooperation. Harcourt’s life course began as a defense attorney for a range of defendants, from Guantanamo to Death Row inmates, to activists facing criminal charges for their political protests. While still active in that realm, he is now also a professor of law at Columbia University.
With a life in both the highly charged world of courtroom drama and the cerebral world of academia, he brings passion to his speculations on social movements and the impasse for social change. He recognizes that the polarity of equally balanced political forces prevents the resolution of pressing social issues; there are those with their market-based approach for solving social problems who must contend with the equal force of those who support state-based solutions.
In the past few years, Harcourt came to appreciate a third force that approaches social issues of organization and implementation outside the conundrum of state-based versus market-based solutions. This is the cooperative sector that includes credit unions, producer/farmer cooperatives, mutual insurance companies, utility cooperatives, housing and retail cooperatives and worker cooperatives. The cooperative sector exists, in one form or another, in communities all over the United States. And at the same time, it has a presence in countries worldwide.
Harcourt competently introduces this sector to a readership unfamiliar with its extensive reach into the lives of millions in this country. Electric Cooperatives alone serve 42 million people and power 56% of the US landmass1 and there are 4,760 US credit unions in 2022 (a drop of 2,000 in ten years) with over 130 million members.2
The EU Parliamentary Research Service recently tabulated that –
There are 3 million cooperatives worldwide; together, they provide employment for 280 million people, equating to 10 % of the world's employed population. The 300 largest cooperatives and mutuals in the world had a total turnover of US$2.018 trillion in 2016.3
Harcourt’s realization was that this third economic sector has proven the viability of a form of organization that inherently benefits people – that is, the slogan “people before profit” ideally forms the practice of this sector. For Harcourt, there is no need to fantasize an anti-capitalist system, when the embryo of one already exists and has a 275-year history in America based on Benjamin Franklin’s mutual insurance scheme in 1752.4
Of course, the argument against Harcourt’s view is that this sector is simply tolerated by the mega-corporations that dominate the economy. For example, electric utilities exist in rural areas because capitalists can’t make any money providing electricity to those areas. The New Deal rescued rural America from under development by supporting cooperative utilities. And, Credit Unions faced a takeover attack by big banks several years ago, only to beat back that incursion through an alliance between rural Republicans and urban Democrats, but still lost many offices.
Harcourt recognizes the limitations of some cooperative enterprises. He references REI’s opposition to unionization, for example. That opposition has also been evident in food co-ops where the customer-members vote in an anti-union Board. But there are cooperative members that have joined unions for obvious benefits and to ally with the labor movement. Cooperatives do have an inspiring set of principles that, if adhered to, position them in opposition to capitalist enterprises. Harcourt outlines the International Cooperative Alliance’s seven core principles to be followed by all cooperatives thusly:
. . . first, that cooperation must be open to all without discrimination and based on voluntary membership; second, that the cooperative organization should be run democratically by the members themselves and that members should have equal say and an equal vote in the decision-making process; third, that the members should contribute and benefit equitably from the running of the enterprise; fourth, that the cooperation should remain autonomous and self-determining, under control of the members only, fifth, that it must strive to provide training and education for the members; sixth, that there be cooperation among cooperative enterprises; and finally, that the cooperative enterprises strive toward the sustainable development of their environment and communities.5
These principles are reflected in the legal codification of cooperatives around the world, including in US Tax Law.
Harcourt devises a political economy analysis of the cooperative sector. Such an analysis has its origins in the late 16th century, but it was two centuries later that Adam Smith approached economic matters in a wholistic manner. He laid the ground work for an examination of capitalism that was followed in the 19th century by among others, Karl Marx. By approaching cooperatives, in all their diversity, from a political economy perspective, Harcourt moves beyond the usual, narrow view of cooperatives as simply an economic entity. He sees them as institutions that also have social and political aspects. This is significant given the current, limited economic view that co-op developers emphasize when promoting cooperative ventures.
It makes sense, given the context of the avaricious system we are burdened with today, to discuss economic security when promoting worker cooperatives, especially to marginalized workers desperate for a “good job.” But to ignore, or downplay, the social and political aspects of cooperatives hampers the multi-faceted development of the sector which is ultimately anti-capitalist.
Besides offering security – once accepted as a member – the democratic practice in cooperatives, where all have an equal vote, leads to the inherent political foundations of cooperatives. Here we have true democracy and not the faux, representative democracy which amounts to a democratic deficit in everyday life. The 19th century socialists saw this clearly as their prime goal: to move beyond the electoral circus and extend democracy to all workplaces. With economic democracy under their work belt, so to speak, cooperators don’t need mouthpieces to rule over them. Their daily practice of decision-making in their cooperatives provides them with the experience and confidence to make decisions outside their cooperative.
And with the extension of democracy into the economic realm we come to the social aspects of a cooperative society, on the assumption that such a society would gravitate towards egalitarianism. Harcourt refers to the huge cooperative enterprise centered in the Basque city of Mondragon. This multi-billion-dollar firm, named after the city where it was established in the 50s, employs 80,000 in 95 cooperatives and 14 Research and Development Centers throughout Spain. Every year hundreds of cooperators from all over the world tour the sites of the various enterprises situated in and around the town. Invariably these guests of Mondragon comment on the egalitarian social life of the city where ostentatious displays of wealth don’t exist and where conviviality rules.
The qualities of a cooperative society, Harcourt believes, prepares such a society to contend with climate change due to the daily practice of collectivity, which is the greatest argument for promoting the expansion of a democratic economy. It is a pity that Harcourt doesn’t develop this theme further. We’ll return to this concern.
There are other disappointments with Harcourt’s erudite, and promising, exposition of cooperation, which we will cover, but first we need to focus on the most radical element of a cooperative society. While there are cooperative ventures in many areas of a capitalist economy – in agriculture, in banking and insurance, in housing and retail food distribution, and services of all sorts – the most critical sector of a cooperative economy revolves around the formation of worker cooperatives. Control of the work place strikes at the black heart of capitalism.
Harcourt doesn’t explicitly focus on worker cooperatives, since he is adamant in demonstrating the widespread nature of cooperation in all areas of society, but he does note several developments that demonstrate that he appreciates worker control as pivotal to socio-economic transformation. He extolls, for instance, Cooperative Home Care Associates, a Bronx-based worker cooperative with 1,600 members. And he highlights King Arthur Flour, the oldest mill in America, as a successful employee-owned company. Though King Arthur is an Employee Stock Option Plan company not a worker cooperative, he thinks of it as equivalent to a cooperative. And his favorable exposition of Cooperation Jackson also substantiates his worker co-op orientation. Cooperation Jackson consists of a network of worker cooperatives and social justice activists determined to create an economy based on serving people, not profit, in Mississippi. It has an outstanding, and exemplary, mission that corresponds with Harcourt’s vision of a cooperative society.
Given the expansion of cooperative ventures ranging from volunteer mutual aid groups to city-wide co-op development agencies springing up in several cities, Harcourt’s book is a timely intervention. He offers an exposition of the scope and depth of cooperation. However, while his analysis of the economic, political and social aspects of cooperation introduces the facets of this movement to a new audience, his need to trademark these integrated aspects as “coöperism” seems unnecessary. I don’t think more ideology is helpful. I am reminded of Richard Wolff’s “worker self-directed enterprises ((WSDEs)” which he finally abandoned in favor of worker cooperatives.
It is true that today cooperative developers, mainly professionals in non-profit agencies, emphasize the economic aspects of cooperative ventures to appeal to the desire for job security and a modicum of control of one’s work – the so-called ownership approach – this is not, however, the primary focus with Cooperation Jackson. Nor is the economic aspect separated from other concerns in, for example, Cincinnati, Ohio where strong union support amplifies the cooperatives political presence in that city.
Further, for any cooperative enterprise to thrive, the social aspect must be totally integrated into the development of the structure. By this I mean, internally, members learn to overcome the lack of egalitarianism in our society by collaborating as peers with others. We are raised from childhood to be competitive and to quickly learn our place as order-takers not order-givers. To actually function in an institution that is premised upon all having an equal voice requires time to absorb the fine points of articulating a position on an issue and listening to other points of view. Externally, cooperatives emphasize their social values to the wider community, if for no other reason than that it’s smart marketing. It is also the best approach to propagate cooperation by building community solidarity. Food co-ops, for instance, often have funds set aside to donate to local non-profits and activist groups.
Harcourt’s intention to distinguish these three aspects of cooperative structures affords him the opportunity to delve into the complexity and potential of cooperatives to expand their influence and to grow their sector.
Harcourt’s main premise regarding the enlargement of the cooperative sector, as we noted, is that it already exists, there’s no need to create it. However, as they exist now, cooperatives are focused on the necessary day-to-day affairs of staying economically viable. Cooperatives do not benefit from government subsidies unlike private businesses. Large corporate farms, for instance, have access to federal programs smaller farmers, allied to a cooperative marketing arm, lack. Despite this handicap, cooperatives have something missing in traditional businesses. They have a set of principles, as mentioned earlier, that motivate their membership to remain committed to the continuation of their co-op. They have a mission that eases them over periods of stress.
These two aspects of cooperatives – their everyday business concerns and their mission – don’t have equal weight in daily affairs. Their mission takes a back seat often while the immediacy of a financial crisis, or some other concern, steers the cooperative through the emergency. However, without their sense of a higher goal than mere profit-making, passing through a crisis would be more difficult. The dominant society has a corrosive effect on maintaining the cooperative’s vision of a larger social goal beyond the bottom line. Usually those who come together to create a worker cooperative, for example, are filled with the sense of a vision of what they want to do, but quickly that vision is supplanted by the necessary business concerns to realize their dream.
If they don’t keep their goal in mind as they navigate the financial and legal details, the stress of accomplishing what are often viewed as tedious tasks can become disruptive of their original solidarity. That aspect of cooperative development depends on a vision that some may think is hopelessly utopian. Yet, without the sense of a collective goal attained together, cooperative ventures become hollow, joyless ventures, that some mistakenly think of as the downside of entrepreneurialism. The collective nature of establishing and running a worker cooperative transcends the usual meaning of that word.
It is unfortunate that Harcourt dismisses utopianism as if it were unrelated to the history and present circumstances of cooperatives. Harcourt trashes Robert Owen who is often characterized as a utopian, though he was the most practical utopian one can imagine. As a mill owner he transformed a typical exploitive, 19th century enterprise into a model workplace of the era. He eliminated child labor and established schools for the former child laborers. A school, unheard of for that period, that offered a curriculum for boys and girls including art, song and dance. Its innovation drew educators from all over Europe to visit.
After transforming the work of the mill, he began democratizing the City of New Lanark where his mill was located. Owen instituted a model urban cooperative with local citizen control and tried to spread his model to other localities. He was defeated by the business class that fought his ideas for a better life for workers outside the factories.
Harcourt praises the first consumer cooperative in the town of Rochdale, but fails to mention that many of the founders, the Rochdale Pioneers, were followers of Owen’s ideas. The very principles that Harcourt lauds as inherent to the good governance of cooperatives (as mentioned above) – the Rochdale Principles – were in part influenced by Owen.
Owenites were active in Rochdale in the 1830s, and in 1838 an Owenite branch was formed which took over a pub, The Weaver’s Arms, and set it up as “The New Social Institution,” a centre of Owenite activity. Owenite speakers gave lectures every week. One visitor noted that Rochdale stood out in its Owenite zeal: “Almost every night in the week is devoted to the cultivation of the mental and moral faculties.” Moreover, at the time the Rochdale Pioneers were founded, the last great Owenite community project at Queenwood (an Owenite model community being planned) was underway, and the struggles and debates related to Queenwood probably energized the Rochdale Owenites in their efforts to bring about the creation of a new co-operative association.6
Harcourt similarly discounts Kropotkin’s anarcho-evolutionist influence amongst early cooperative enterprises, though he may have not read the account of Kropotkin’s encounter with Lenin in Moscow in 1919.
“Now you are saying that we cannot do without authority,” thus Pyotr Alexeyevich [Kropotkin] started to theorize, “but in my opinion it is possible… You should see how such an anti-authoritarian beginning flares up. In England for example — I was just informed about this — dockworkers in one of the ports have established a wonderful, completely free cooperative, where workers of all other factories come and go. The cooperative movement is important to a great extent, yes, it is of the essence…”
“I looked at Vladimir Ilyich [Lenin]. His gaze contained an element of irony and amusement: listening very attentively to Pyotr Alexeyevich, he was clearly amazed that while the revolution of October had expanded so enormously, it was still possible to talk only about cooperatives and yet more cooperatives. And Pyotr Alexeyevich kept talking and talking, he told us how somewhere else in England another cooperative had been established, and how somewhere else, in Spain, some other little (cooperative) federation had been established, and how the syndicalist movement in France was developing… “That is very harmful,” Lenin, who could not restrain himself any longer, interrupted, “by not devoting any attention to the political side of life and by splitting up the working masses, one distracts them from the direct struggle…”
“But the professional movement unites millions, and that in itself is already a colossal factor,” Pyotr Alexeyevich said excitedly. “Together with the cooperative movement that is a big step forward…”7
I don’t know how useful it is to characterize a society by one standard. If I were pressed to do so I would probably opt for labelling US society as dedicated to the Death Drive (Thanatos) as Freud theorized. Or to update that conception, US culture is driven by addiction – to commercial entertainment, smart phones, drugs of one sort or another, and so forth. Harcourt’s view raised in the second half of Cooperation, however, posits that US is a punitive society. It is understandable, given his legal background as a defense attorney that he would adopt this characterization. And there is some validity to this view since the US incarcerates a higher percentage of its population than other countries.
It is major disappointment though that with a good introduction to cooperatives and their multifaceted aspects in the first half of his book, Harcourt, the latter part of Cooperation, speculates about how a cooperative society would handle the major issues of incarceration. He moves from describing the reality of cooperation to aspirational declarations. He wants to replace “the punishment paradigm with a cooperative paradigm…creating a more just social order based on equal citizenship, equity, and respect and care for others and for the environment.”8
Later in his book Harcourt notes that a cooperative society would usher in “the life of care, mutuality, and cooperation would require a foundational change in political vision and action, our very way of being.”9 Harcourt, unfortunately, fails to explain that this “vision” is in fact realized, at least partially, on the level of worker cooperatives when, to function as a collective of equals, the members need to decondition their training as subjects of a hierarchical society.
However, on a larger scale we have one famous study, Beyond the Corporation, where David Erdal researched the Italian town of Imola that manifests the “vision” in the daily life of the community.10
The city of Imola hosts more cooperatives than any other town in Italy, and very likely the world. One in four citizens are cooperative members. Erdal did a study of the residents of that town and compared it to a town nearby with half the number of cooperatives and a town a bit farther away with no cooperatives. More than a decade has passed and I don’t believe that there has been a similar study.
I’m going to quote a long section from Erdal’s findings because they apply directly to Harcourt’s concerns about the US being a punitive society:
- In those three towns I compared public data on mortality and a number of other measures – voting, blood donations, car ownership, household wealth and others – and carried out a random survey of households in each town asking about such things as the gap they perceived between rich and poor, their own social networks, their attitude to the authorities, their educational experience, and their perceptions of crime, including domestic violence.
- The overall pattern of results showed that the towns with a greater proportion of businesses owned by their employees had healthier communities.
- They perceived a small gap between rich and poor.
- They had larger and more supportive social networks – more friends to call on if they needed help.
- They saw the political authorities as being more on their side.
- They believed that domestic violence was less prevalent.*
- They gave more blood – blood is a pure gift in Italy; no payment is made.
- Their children stayed at school longer, and did better.
- They continued being trained and educated all their lives, to a radically greater extent.
- More of them voted in elections.
- *Except for domestic violence, crime rates were so low that I could not generate useful statistics on crime.11
Most noteworthy according to Erdal is that the residents of Imola lived longer – two and a half years longer than the people in the town without cooperatives.12 The most obvious conclusions, given the lower rate of heart problems, is that control over one’s enterprise resulted in less stress.
Harcourt missed another opportunity in his introductory remarks, Getting Started, to highlight the relevance of “people cooperating and working with one another, throughout all aspects of their lives, for the well-being of all the people and the environment.”13 In several places he mentions the urgency of contending with climate change and offers some opinions on how cooperatives could have an environmental effect, but nowhere does he go into specifics. This is a shame since one of the best examples of cooperatives working to benefit the environment are the Hoedads, the worker cooperative tree-planters operating from 1971 to 1994 mainly in the states of the Northwest.14 Their name comes from the tool they used to plant bare-root trees on the hills of the Cascade and Northern California Mountain ranges.
The Hoedads consisted of small autonomous groups all contracted directly by the U.S. Forest Service or large landowners. In its heyday hundreds of workers would be in the forests laboring on various reclamation projects beside planting trees. They were pioneers in bringing innovative projects to the Forest Service based on their experiences in the field and in introducing women to forest work. In fact, some crews were all women crews.
The Hoedads should be replicated today to reforest the land devastated by wildfires. Instead of waiting for the Federal Government to act, local communities could initiate replanting on private and public lands thereby forcing the hand of the Forest Service to reinstitute their old practices.
Despite some lapses in cooperative history, Harcourt perceptions regarding the trajectory for expanding the cooperative sector take the form of “combining, compounding, and leveraging.” His begins his analysis with the cooperative itself, the process of forming and maintaining the cooperative and not with the individual, which emphasizes ownership in cooperatives. He states –
Beginning with the process of cooperation, we see that certain forms of cooperation are more beneficial than others. Worker cooperation, for example, is particularly formidable at reducing inequality. But other forms can be even more powerful when they are combined with other modes of cooperation [such as hybrid cooperatives that incorporate consumers and workers], or [co-ops] leveraged by means of a connected credit union, or compounded by doubling down on the core principles of democratic participation and sustainability.15
The formation of municipal cooperative networks in several cities in the US is an example of combining. And the formation of unions in consumer cooperatives by the permanent staff could be considered compounding the democratic values of cooperation to another level of practice. Leveraging might take several forms also: a bike delivery co-op distributing baked good from a co-op bakery, or a print co-op extending printing discounts to other co-ops.
One of the best examples of worker cooperatives extending “the core principles of democratic participation and sustainability” was the JASecon Festival in Oakland a decade ago. JASecon stood for a Just, Alternative, and Sustainable economy and the festival was promoted as a “Festival of the Grassroots Economy.”16
Several members of worker cooperatives allied with social justice activists and non-profits agitating for an alternative economy – like Time Banks – and organized a one-day extravaganza of fifty participants: co-ops, non-profits, and activist groups. The Oakland free paper publicized the event, a community bank participated, and a professional caterer donated time to serve lunch for the all-day event. Urban farmers came, as did members of housing co-ops, and Land Trust organizers. Hundreds attended the event. Accompanying the tabling there were several hours of lectures and discussions on topics ranging from starting a co-op to achieving a sustainable society on the local level
Lastly, a major disappointment with Harcourt’s speculations about the merits of the cooperative paradigm he outlines is that he doesn’t grapple with the most contentious economic issue of growth and cooperatives. He introduces the topic, and then drops it for “more research and healthy debate.” If cooperatives have no approach to this issue, are they even relevant for overcoming capitalist imperatives?
It is not surprising the Harcourt abandons further inquiry since there is actually little discussion of this issue to be found in cooperative circles. There are however some cooperative practices that relate to this issue. The Cheese Board Collective in Berkeley doubled its membership when it began selling pizzas and it began to think of expanding their cooperative to other locations. If it were a typical capitalist enterprise it would have franchised its operation and head onto the road of entrepreneurial success like Starbucks, but it had a different idea. Instead, the members of Cheese Board agreed to financially support new co-ops and then seeded the cooperative startups by training the new, autonomous cooperative members to adopt their recipes. In this way they helped to create independent co-ops in a nearby city. In all five little Cheese Boards have been established and all are thriving.
Something similar happens with food co-ops. If one is successful in one community another locality creates one. Eventually, over time farmers are involved and a distribution network develops.
These examples aren’t necessarily models of degrowth, but they do serve to demonstrate that a model of local control and community support can limit the capitalist imperative of growth. In several towns when a major retailer closes leaving the citizens no place to shop but a mall miles away, the townspeople rally around to purchase the store collectively and run it as a community service. Again, this may not be degrowth in the popular sense of the term, but their action benefits them and the environment, and it prevents the mall down the road from expanding.
The major point here is that cooperatives are best placed to resolve issues like downsizing since they are established to respond to community needs. We can use housing as an example of cooperatives minimizing housing construction by consolidating convivial housing arrangements that are more appealing in social relations than autonomous homes sprawling over the landscape. The popularity of the co-housing movement testifies to the value people place on shared housing arrangements. And with food cooperatives, the ideal scenario is to support local farmers and minimize transportation issues for food stuffs.
On the whole there is much to like in Harcourt’s Cooperation, especially his informative introduction to the cooperative sector of the economy. For members of cooperatives, his delineation of the three aspects of what cooperation entails is worth contemplating. So too should his analysis of combining, compounding, and leveraging be studied so that the movement for a post-capitalist economy can be hastened.
- 5Cooperation: A Political, Economic, and Social Theory, p.13
- 8Cooperation, p.137
- 9Ibid., p.162
- 10Beyond the Corporation: Humanity Working (Random House UK, 2012) p. 239
- 11Ibid., p. 240
- 13Cooperation, p.ix
- 15Cooperation, p.93
- 16JASecon Festival: https://www.indybay.org/newsitems/2009/09/08/18621302.php A post-festival video was produced: https://youtu.be/yDrMkQFsQTQ