We hear a lot about “hope” and “change” these days, but how does our vision compare with the kind of lasting change brought about by the humble men and women of Rochdale, England, a century and a half ago? For the Rochdale Pioneers, the founders of our modern cooperative movement, cooperation gave them real tools to change a dire economic situation. Beset by indebtedness, hunger and lack of job security, they looked to principles of democracy and self-help over bailouts. They succeeded by enabling their cooperative society members the means to suffrage, economic franchise, and education. It’s impossible not to feel moved and inspired by their dedication and courage.
Yet 1844 seems like a long time ago and aspects of the Rochdale Pioneers story feels undeniably quaint. Times have definitely changed. But sometimes that old adage the more things change, the more they stay the same, applies. When you consider the dramatic economic upheavals of the past year, and the way we arrived at the current situation, you can imagine the Pioneers looking at us with some pity, as well as great understanding of our current problems.
David Thompson is president of the Twin Pines Cooperative Foundation, and author of Weavers of Dreams, a book about the Rochdale Pioneers and the founding of the modern cooperative movement. In a discussion about the relevance of the Pioneers experience to today’s cooperatives, Thompson noted that it was similar economic disruption that forced people to look at other ways of doing business, and likewise an opportunity for contemporary cooperators. Now that cooperatives today are considering the impact of recessionary times on their growth and operations, it’s a good time to consider the poignant lessons of the Rochdale Pioneers.
Invest Member Capital for Common Good
“There were lots of tricks going on in those days, the same as now. People were making unacceptable terms on capital and shady schemes were common. The Pioneers observed that the bad decisions made by people with money were having an effect on the lives of regular working people,” Thompson said.
Because of this dynamic, their co-op’s emphasis was on the uses of capital, and not on its economic return, because they saw the social and economic abuses inherent in excessive returns on investment. They determined that the capital invested in the co-op would not be designed to make any single one person rich, but to create collective wealth that benefit everyone.
Reliance on member capital is still critical to cooperative growth and expansion, according to expansion planning and business development consultant Bill Gessner. “Acquiring sufficient member capital is a healthy test of the membership and community’s commitment to having a viable, successful, and sustaining food co-op. Member loans in particular instill accountability in the co-op.”
Adequately Capitalize Your Co-op
“The Pioneers also knew that if they wanted to have the just society they dreamed of, they had to put every resource they had into building it,” Thompson said. It wasn’t just lip service. It took them all two years to save up the investment of two weeks worth of wages. It came slowly, a penny here and a penny there, but they were determined. Thompson said this is because they took their cooperative idea very seriously. “They felt like they had to rebuild the commonwealth, to grow those institutions that were of value to them and that they relied on.”
Thompson said this is especially relevant now when you consider all the hits to retirement and pension accounts today that are draining life savings. History has vindicated the Pioneers perspective that fairness goes beyond the feel-good factor. It has long term worth. Investments made in cooperatives have proven to be of lasting value, a strong argument for cooperation during boom and bust.
Empower Member Owners
One of the things that consumed the political thoughts of the Rochdale Pioneers was their lack of democratic power. Only people who owned land had the right to vote at that time, and the Rochdale Pioneers felt this injustice deeply. From their perspective, having a vote in the cooperative was absolutely necessary to the equitable ideals of cooperation and a step toward introducing democracy to a reluctant society. They built housing cooperatives in order to claim they were landowners and be able to vote.
In America today, it’s easy to take the idea of voting for granted, and at the food co-op elections often garner an apathetic response. So how does the Pioneers’ passion for democracy square with modern times?
“It’s a critical factor,” Thompson said. “It comes down to this: The decisions that have robbed people of their money were made in places like New York City or London. How much control did they have over that? None. While the Pioneers strove for political democracy themselves, they also wanted economic democracy. They understood what you control is what you have invested locally.” Thompson argues that the Pioneers would urge cooperatives to make local their priority. “They would say you can revitalize what you invest in locally. That’s what will rebuild our communities and give us more power,” he said.
Invest in Education
One of the most remarkable aspects of the Rochdale Pioneer story is how much resources they put into the education of their members. Public schools didn’t exist, and like voting, education was something only the well off could afford. The Pioneers believed that in order to be better business owners and citizens, they needed to be educated. Therefore, the co-op classroom was born.
In most American cooperatives today, literacy is not an issue, but ongoing education about the cooperative idea is always relevant. Board leadership consultant Marilyn Scholl notes that the benefits of cooperative ownership needs to be tangible and clearly communicated, not only to provide for the co-op’s future leadership, but as a means to building community and local economies.
Invest in Cooperative Development
As our food cooperatives look to grow and expand, this is perhaps the most important take-away from the example of the Rochdale Pioneers. “Especially now cooperatives should put a much larger emphasis on raising capital from the membership. The less you have coming from external sources, the more control you have,” Thompson said.
Together, food co-ops have a fair amount of assets Thompson noted, and it’s also important to continue to invest in cooperative development in order to use a portion of co-op capital to cultivate the growth that’s possible within our sector. “That’s what the Pioneers did with their own cooperative bank. They wanted to foster the growth of cooperatives.”
Above all, the Pioneers did not panic or succumb to doubt, even with the steep challenges they faced. They believed that by staying the course, adhering to the principles of fairness in business, their cooperative would succeed. And it did. Worldwide and beyond all expectation. The Rochdale Pioneers might not want to admit it, but their legacy to us has been one heck of a return on investment.