In defence of the social economy

It’s amazing what you find on the web sometimes. I’ve just turned up an impassioned defence of the idea of the social economy that I apparently wrote 16...

It’s amazing what you find on the web sometimes.

I’ve just turned up an impassioned defence of the idea of the social economy that I apparently wrote 16 years ago, presumably for ICA Review, which the ICA has thoughtfully preserved. It’s both fun and sobering to read it again!

January 1996

The Social Economy: A Reply to Dr Wülker

Perhaps Hans-Detlef Wülker (volume 88 no. 2, page 128) intended to provoke – well he succeeded. I, for one. He even contradicts himself: one the one hand “Member-oriented solidarity means self-help” but on the other “Co-operatives have very little in common with … self-help groups”. His thinking, I said to myself, is one reason the movement is in the state it is today – that is, discredited and struggling for survival in many fields.

I finally put finger to keyboard at the assertion “Co-operatives do not have any direct social or socio-political tasks.” This is simply not my experience – and I have worked in, banked with, and at times lived in, the co-operative movement for 18 years.

There are many examples of the fine work done by co-operatives. In the first co-operative in which I worked – for 8 years – [Suma Wholefoods] our constitution did indeed explicitly mention our social objectives; at registration we adopted what at that time was known as a “preamble” to he Rules. This “mission statement” – voluntarily assumed – gave the co-op a real sense of where it was going – and it was going far further than Dr Wülker seems to think possible: today it is ten times the size it was then. A survey in 1985 showed that it was the largest single source of help for other co-operatives in the region too.

What is remarkable about his article is that he totally overlooks the fastest-growing sector of them all – worker co-ops: these do not appear in his list of the supposedly disparate sectors which he says are incapable of collaborating under the social economy banner. They are invisible to him precisely because his federation[Deutscher Genossenschafts- und Raiffeisenverband, DGRV] refuses to admit them, forcing newer forms of co-operation to incorporate under company or association law; and this reduces, rather than increases, the movement’s solidarity, resilience and adaptability Dr Wülker evidently fears that to exhibit solidarity with society at large is a sign of weakness – in other words that the only way to compete is to selfishly serve one’s members and them alone. In what century is he living?

Even the largest capitalist corporations nowadays make some concessions to being a good neighbour – some even make a virtue of their ethical stance. Co-ops got there first. Serving multiple stockholders is very much the coming trend. And as for his fears of  loss of independence, to serve social goals is not to be “used” – it is simply a higher form of being, a recognition of the interdependence of modern citizens.

Mr Wulker needs to open his eyes. Society is changing, and the co-operative movement must not be afraid to change with it. And one does not change by shutting oneself off in an airtight compartment: the most creative developments often happen at the interface between two ideas. Examples: the tremendous growth of employee ownership (11 million Americans own shares in the company that employs them through ESOPs), social co-operatives (over 2,000 in Italy alone – and they are true co-operatives – bringing the providers and beneficiaries of social services together in the same organisation). These new organisational forms are solving economic and social problems by creatively combining the best features of two other organisational forms: employee-owned companies apply the fruits of management efficiency in an equitable way, and social co-operatives apply entrepreneurial flair in place of state bureaucracy. Society needs these innovations!

Please note that it is these new forms of co-operation which are gaining market share, opening up new markets, and being a creative force in society – not the old-established consumer co-ops, which often do little to distinguish themselves from any other supermarket chain. The movement needs these innovations too!

Defensiveness is not getting the movement anywhere. Co-operatives need to make new alliances. It is right and proper to sacrifice a little bit of autonomy in this quest. The social economy, which is a spectrum, not to be defined in the oppositional way which Mr. Wülker uses, should be seen as just that – a route to greater power and influence. Not a threat, but an opportunity that must be seized.

Toby Johnson

National Expert for European Commission

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