• ■ 1 



a percentage of the people as possible own 



something. 



This large class of people who formerly 

 owned nothing now, in the larger sense, do 

 not own very much, a few shares of coopera- 

 tive stock, and yet they do have the pride of 

 looking at their store, looking at their factory 

 buildings, looking at their warehouses with the 

 feeling this is mine and that development of 

 the sense of ownership is very real, and in 

 most quarters is felt to be rather an important 

 stabilizing influence in government. 



Swedes Bust Trusts 

 The other thing 1 want to mention in the 

 line of consumers cooperative accomplishments 

 is what they have done in trust-busting and 

 the outstanding example of that is the con- 

 sumer cooperative movement in Sweden. The 

 Swedish people laugh at our attempts at 

 breaking up monopolies. They say, "you try 

 to do it in America by legislation that never 

 has worked, it never has worked anywhere in 

 the world and never will work." In Sweden, 

 they have no anti-trust legislation of any kind. 

 On the other hand, the consumer cooperative 

 movement has gone in after they have built up 

 reserves so that it had ample capital. It has 

 stepped in here and there where certain in- 

 dustries were being monopolized; it has built 

 factories, gone into business to the extent it 

 deemed to be necessary in order to crack the 

 monopoly, in order to bring prices down. 



One of the outstanding examples of that 

 is the story of the galosh trust. Sweden is a 

 country where you have to protect your feet 

 to keep them warm in the winter time. For 

 years the galosh business was completely 

 monopolized. Prices were extremely high, so 

 high that very few farmers in Sweden could 

 afford to wear overshoes, indeed they wore 

 wooden shoes and wrapped burlap sacks 

 around their legs. The consumers cooperative 

 bought the galosh factory and cut the price 

 in two, not only in the price charged but 

 naturally that competition broke up the mon- 

 opoly and it reduced the entire price level of 

 rubber overshoes to about half what it had 

 been before. 



What is Cooperation.'' 

 Before I go any further, I think it is well 

 we have something of a definition of coopera- 

 tion, a very much misunderstood word. Your 

 banker will tell you he will cooperate with you 

 when he loans you money on a note. We use 

 the term in all sorts of ways. But, getting 

 down to what we understand by cooperation, 

 there are three principal kinds: the cooperative 

 marketing with which we are all familiar, the 

 cooperative buying of farm supplies with 

 which you are also very familiar, and then con- 

 sumer cooperation. There is a good deal of 

 confusion between these last two. You will 

 see in most of the statistics of consumer co- 

 operation in this country the farm buying co- 

 operatives included, thereby the business added 

 in as if the two were the same thing. Super- 

 ficially they may seem to be the same thing. 

 Farmers get together and organize, form a co- 

 operative to buy some of the things they need 

 for the most part, things they need in the 

 operation of their farm. They do that in 

 order to buy at wholesale and in order to use 

 the power of volume buying to save a little 

 money. Consumers get together and establish 

 a store to buy their food and clothing and the 

 various things they need if they are to con- 

 tinue to live and exist, and again they do it 

 to use the power of their collective buying to 

 save themselves some money. 



To that extent, the two are very much alike. 

 They might be included together but the mat- 

 ter goes much deeper than that, and that is the 

 thing I think we need to understand, to ap- 

 praise, perhaps, not to condemn. That depends 



upon our viewpoint and outlook on how the 

 thing seems^ to us after we appraise it, but 

 from that point on there is a great difference 

 in theory and philosophy and ideals. 



I believe most of you will agree with me 

 when I say that the farmer is a capitalist, not 

 as much of a capitalist as he would like to 

 be in a good many cases, but fundamentally 

 the farmer is a capitalist in the best sense of 

 the word. That is he wants to own something 

 and after he has acquired ownership of some- 

 thing he wants to pay for it. He has that 

 sense of ownership very deeply ingrained in 

 his soul. In that sense he very definitely does 

 belong to the capitalist class. He may quarrel 

 with the abuses of the capitalist, but, with the 

 exception of a very small group on the left 

 wing of agriculture, farmers, in general, are 

 not trying to submarine the profit system, they 

 are not trying to do away with capitalism. 

 The thing they are trying to do is to become 

 a little more of capitalists than they are now. 

 If I am correct in that philosophy, that is the 

 way farmers think on this particular question. 



Then right there begins a very definite di- 

 vision between farmers and the prevailing 

 spokesmanship in the consumer cooperative 

 movement, the people who speak for con- 

 sumer cooperation, the people who are charting 

 its course. 



Refunds vs. Profiu 



Speaking now particularly of England and 

 Scotland, I am going to dwell on this point 

 for a few moments, because whether for good 

 or for ill, the consumer cooperative movement 

 in the United States through its leaders gets 

 most of its philosophy of the movement from 

 England and Scotland. The prevailing con- 

 sumer cooperative views in this country reflect 

 very closely the views in England and Scotland. 

 The English and Scotch consumer cooperative 

 leaders believe the term "profit" is immoral. 

 They do not use the word if they can possibly 

 avoid it. They even go so far as not to use the 

 term patronage dividend because dividend 

 carries the idea of profit and profit is some- 

 thing that is unholy. They refer to it as 

 patronage refund. They look upon their move- 

 ment as something so fundamental that its 

 long time aim is to change the entire course 

 of human society, to eliminate profit, to divide 

 the national income between payment for per- 

 sonal effort and a very small return on shares 

 in cooperatives and legitimate invested capital. 

 All the rest of the results of human effort 

 to go to the consumer in the form of lower 

 prices or patronage refunds 



So these folks say consumption is the chief 

 end and aim of human existence, speaking from 

 a material standpoint. We only live when we 

 are consuming goods. Production is just 

 hard, disagreeable work. We do what we 

 have to do along that line but production 

 is relatively unimportant. Consumption is the 

 important thing in a hutnan life. Hence, hu- 

 man life ought to be organized around con- 

 sumption and the way to do that is with the 

 consumer cooperatives 



"Big Farming" Fails 

 With that brief explanation, I think you 

 can understand why the big consumer coopera- 

 tives in Scotland and England have done some 

 of the things they have done in their relation 

 to agriculture. They went out after the War 

 into a very comprehensive campaign of buy- 

 ing farm land. They bought thousands and 

 thousands of acres of farms and proceeded to 

 operate them, not to rent them to tenants but 

 to operate them. In England, the cooperatives 

 still own about sixty thousand acres of farm 

 land. The English Cooperative Wholesale 

 Society owns large tea plantations in India. 

 Until a few years ago, the Scotch Wholesale 

 Society owned some extensive wheat farms in 



western Canada. The explanation of that is 

 perfectly simple. The say that consumer co- 

 operatives must ultimately own all means of 

 production, that only by doing that can they 

 take all the profit out of production and reflect 

 it all to the consumer in lower prices and 

 larger patronage dividends for his products. 



This experiment did not work very well 

 as almost any farmer might know it would 

 not work very well. They could not produce 

 food as cheaply as the individual family sized 

 farm. So, to a certain extent, they have 

 modified their theory. Some of them have 

 modified that theory in this direction. They 

 have come to this rather sensible viewpoint 

 saying, after all, farming is not capitalistic in 

 the invidious sense. It is a family enterprise, 

 and it had better remain such. So there is a 

 certain segment of cooperative opinion ia 

 Great Britain that holds that viewpoint. But 

 there are others, and a very large number, if 

 not a majority of them, who still cling to the 

 idea that the farmer is a capitalist and as 

 such he shares the immorality of all private 

 capitalists 



In Great Britain 

 In Great Britain, they have gone very ex- 

 tensively into farm marketing schemes. From 

 the standpoint of the farmer, those farm mar- 

 keting schemes have worked. They have 

 raised prices materially. They have made it 

 possible for the farmers of Great Britain to 

 live when they could not have lived any more 

 than we could on the basis of 1932 and 19J}. 

 Of course, there are some things wrong with 

 these schemes. They are not perfect by any 

 means, but the consumer cooperative movement 

 m Great Britain has consistently opposed these 

 schemes. They have seized upon their weak- 

 nesses, have talked about them. Their gen- 

 eral attitude toward them has been just the 

 same as the attitude of many people and in- 

 terests in the city of Chicago; everything about 

 them has been wrong, and there has been a 

 consistent campaign of opposition in Eng- 

 land as to the farm relief schemes just as there 

 has been in this country. The difference be- 

 ing that over there the leadership and the 

 strength of that campaign has been in the 

 consumer cooperative movement. Naturally 

 that has contributed to division between farm- 

 ers and the consumers cooperatives 



They Have our Ideas 



In Sweden, the philosophy back of the con- 

 sumer cooperative movement is entirely differ- 

 ent from the philosophy in England and 

 Scotland. The British philosophy is ultimate 

 consumer cooperation in everything, the co- 

 operative commonwealth in which the con- 

 sumer cooperatives operate the entire produc- 

 ing and distributive system of the country. 



In Sweden, the viewpoint is much more 

 practical. You fellows could sit down and 

 talk to the Swedish cooperative leaders and 

 would find yourselves talking much the same 

 language. You could not do it in Great 

 Britain. They have a practical viewpoint in 

 Sweden. Their objectives are two: to keep 

 down the cost of goods to the consumer as 

 much as possible by narrow distributive mar- 

 gins; secondly to break up the monopolies 

 that are fixing prices at unreasonable levels. 



The Swedish consumer cooperators are 

 not much different in philosophy or coopera- 

 tion from our farm buying cooperatives in this 

 country. They operate very much the same 

 and, what is more important, with much the 

 same ideas back of them. 



In Switzerland, they have gone a little 

 further along that line. Consumer co-opera- 

 tion is not a labor movement as it is in most 

 of the other countries. So they have the prob- 

 lem not only of relationship with agriculture 

 f Continued on page 32) 



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I. A. A. RECORD 



