The Coop Transformation
why cooperatives have deeper leverage for systems change than social enterprise
This week and next, I’m thinking about what the transformation is that a cooperative performs on the typical structure of a business. Today is just a quick overview of what this revolution is and where it’s located. Next week, I’ll outline a thread I started following since this subject came to my mind: the Roman, colonial, and racist history of the modern business structure.
For context, I was hired in November to build a member-owned coop of congregations, schools, nonprofits, and other coops who come together to negotiate group contracts on common expenses (electricity, trash/recycling, gas, etc.). We leverage our aggregated economic power for racial equity by pursuing contracts with BIPOC-owned businesses. This idea was developed over the past ten years in Washington DC into the very cool, very effective coop that employs me: the Community Purchasing Alliance. And I get to do this work in partnership with Greater Boston Interfaith Organization. So dope.
Coops first captured me about six years ago when I stumbled into them while researching community development models that can support real systems change for my seminary thesis. I was interested in economic structures and institutions that are designed to foster shalom: and coops have proven potential to deliver. The notion of a business designed, at the most fundamental levels, to distribute its surplus earnings and decision-making power equitably is beyond compelling. Coops present a strategy for economic equity that delivers on the front end versus typical backend approaches (redistributive taxes, etc — which I mostly also support, but would have less need for if distributions were equitable up-front). Why not get the equity right out of the gate instead of always trying to fix it after the primary economic exchanges have taken place? Ain’t no reason for CEO’s to be making 500 times what some of their employees earn, y’all. Never. Billionaires make for sick societies.
Recognizing the exact nature of this transformation, however, is crucial for internalizing why it has such deep leverage on revolutionizing capitalist systems.
The coop is an innovation (or, more accurately, a return) within the bylaws of a business: legal status, governance structures, institutional purpose. It offers an institutional policy mechanism through which capital can be decoupled from its unilateral grip on power. Doing so implants a fundamentally different character into the nature of the entity itself. This is substantively different than how we typically think about social enterprise. Social enterprises orient a product, mission, or businesses model toward a social purpose. But more often than not, their internal business structures too often remain anti-social: hierarchical, commodifying of labor, transactional, extractive of human resources.
Coops flip these features on their head by building a business model through an entirely different paradigm. It’s important to see that “business model” here doesn’t refer to how a business makes its money. It’s about how the people within the business relate to one another, how those people make decisions together and get work done, how they relate to other businesses and the community, and how they relate to the fruits of their work. Most fundamentally, this is accomplished by introducing democracy into the business’s ownership and leadership structures, and by dissolving the traditional boundaries between owners and workers or owners and customers. In a typical company, your percentage of ownership or the number of shares you hold equals the weight of your vote and influence over a company, as well as the amount of profit you’re entitled too. Coops, on the other hand, operate on a one member, one vote system. Everyone has equal say.
Let me caveat upfront: coops are not inherently antiracist or decolonial. There are plenty of ways capital still has its talons in the cooperative sector, and plenty of ways whiteness continues to operate with its typical violence within coops. The movement is littered with the ugly proof. Direct focus on racial equity is demanded.
That said, the dominant business model we’ve inherited is grossly entangled with the West’s ravenous thrust toward racism, colonialism, and individualism. It’s not enough (not nearly enough) to believe that the damage caused by capitalist corporations can be counterbalanced through adding in some “social impact” goals or giving away a product for each one that’s purchased. We need fundamentally different ways of relating to one another within that sphere of society that sustains our needs through producing and sharing the goods and services we rely on. We need institutional forms whose very DNA is designed for cooperation, community, and seeking the common good—the values of communion birthed into what’s inaccurately been labeled the ‘private sector.’
Coops get the ball rolling that direction in significant ways. And societies have been functioning in basically this way since time immemorial.
As I started reflecting on the specificity of the innovation represented by cooperative structures, I began to ask questions about how we got the corporate legal entities that dominate today’s private sector in the first place. And oh what a twisted trail I found myself following! It led me from the Gilded Age back through the ruins of the Civil War, into slavery and armies sailing around the world at the dawn of colonialism, and finally to that Empire where all roads lead. I’ll unpack what I’m learning about corporate origins next week.