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03 September 2012

Did you know this about co-ops?

Throughout the twentieth century and until today, cooperatives have been mostly invisible, ignored by the mass media and political leaders who are more interested in power, fame and control. Yet more than one billion people, a sixth of our global population, are members of co-ops. The world’s largest non-governmental organization is the International Cooperative Alliance (ICA), representing 246 national and international organizations...

Cooperatives provide over 100 million jobs around the world, 20 percent more than multinational enterprises. Cooperatives are also more likely to succeed than privately-owned enterprises. In the United States, 60-80 percent of companies fail in their first year, while only 10 percent of cooperatives fail during that period. After five years, only three to five percent of new U.S. corporations are still in business, while nearly 90 percent of co-ops remain viable. [World Council of Credit Unions, Statistical Data: United States Credit Union Statistics, 1939-2002.]..

The NAFTA agreement of 1994 caused Mexico to charge co-ops twice the tariffs that they charged private enterprises, requiring them to carry expensive life insurance on every member–in effect tripling their total tax burden. Since then the legal status of cooperatives in Mexico has changed continually, sometimes yearly. NAFTA does not allow Mexico to subsidize coffee or corn growers, even though the US government subsidizes their own corn growers as well as coffee growers in Vietnam. Brazilian law requires a minimum of 25 members to incorporate a cooperative, compared to Venezuela, which requires only five. In countries with discriminatory legal structures, most would-be cooperatives are forced to register as an association, “civil society” or something else, with no legal protections...

Laws concerning cooperatives are different in every country; in fact some laws were written to hinder and block cooperatives. Those who wish to start a cooperative should first consult their national association of cooperatives and visit successful co-ops, ideally those which operate in the same sector, to learn as much as possible from the experience of others. These experienced cooperative workers can also advise about psychological ways to win the support of the local people.

Cooperatives benefit the community at large by creating jobs, retaining wealth and increasing social connections among the inhabitants. The practice of economic democracy in co-ops raises awareness of democratic issues among the workers as well as in the wider community.


excerpted from After Capitalism: Economic Democracy in Action by Dada Maheshvarananda (Puerto Rico: Innerworld Publications, 2012).

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