TRUE AND FALSE CO-OPERATION.
[To TI1E EDITOR OF THE " SPECTATOR."] SI11,—The use made of my name by the reviewer in your last number of a French report upon Co-operation with which I am not yet acquainted, may give me some title to offer a few observa- tions in reply to the article in question, the tone of which iz indeed perfectly fair and moderate.
One singular fallacy, as it seems to me, runs through it, and
lies at the bottom of M. Cernuschi's experiments, on the failure of which it dwells. It is that of supposing that there can be such a thing as Co-operation without Co-operators. Division of profits among customers in proportion to the amount of their purchases is not in itself co-operation, it is simply the machinery which has been found most successful for co-operative consumption. The bestowal of such profits by a single trader on his customers is a mere form of benevolence,—it may be interested,—and can bear no other results than benevolence, interested or not. So far from experi- ments like M. Cernuschi's affording any data whatever by which to judge of the effects of co-operation, they simply serve as beacons to warn co-operators off false paths. I do not hesitate to say that an establishment like M. Cernuschi's leads to exactly opposite results to those of a true co-operative store. M. Cernuschi, as I understand, supplying the whole capital of certain butchers' shops himself, calling for no pecuniary support from his customers, proceeded to give them half his profits. The sole tie between him and them, then, was the hope of bonus. This could, in the first place, attract none but the most greedy and sordid ; for if there is one fact which the annals of every co-operative store establish irrefragably for those who are familiar with the working of such bodies, it is that the mere bonus-hunters amongst their members, who usually form a " mammonite" party of themselves, are the worst enemies to the prosperity of the store, those who most hamper its development through a judicious reservation of capital once made for purposes of future utility, those who are the most incapable of understanding the necessities of trade, those who are the first to desert the store in hard times, or at any time, for the prospect of the most trifling, the most fallacious advantage else- where. And if this be the case with reference to the members of a co-operative store, how much more so must it be with mere customers, not called upon even to make the trifling sacrifice of a 1/. subscription without knowledge of or responsibility for the working of the establishment ! But just in the same proportion as M. Cernuschi's bonus would attract the worst portion of the customer class (except some very few persons in affluent or at least easy circumstances, who might deal with whom on grounds of personal esteem—and probably refuse a bonus when offered), in that same measure would it generally repel the best. If there is one thing, thank God ! which the honest working man of every country shrinks from and despises, it is the receipt of alms, and M. Cernuschi's bonus he would certainly look upon as such. For, in the next place, it is the grossest fallacy to suppose that it is the mere bonus on consumption which draws our working men into co-operative stores, though it is, I admit with shame, far too attractive already. For the thoughtful, the sensible, the independent-minded, still more for the earnest and enthusiastic, there are quite other incentives. There is the certainty that by uniting together they will be able to secure for themselves and for their families full weight, full measure, of articles of the best quality, which they know or believe they mostly get elsewhere in scanty weight and measure and adulterated ; there is the honest pride of being able to secure the same to the public ; there is the attraction of meeting with their fellows, and carrying on together a business which is their own ; there are the infinite possibilities of development which every such beginning, however small, affords ; there is the con- sciousness that by establishing one little centre of honest trade, self-ruled in fellowship, a whole class is being trained and raised to higher things. The division amongst co-operators of profits upon consumption has, then, this value, that it harmonizes entirely with all the objects of the consumer. The member of the co- operative store has a direct interest in the polection of its trade ; he is interested in having the best articles, the best means of verification in quantity and quality, the best attendance, the beat management, the best accounts, and the best supervision of those accounts ; his power and his responsibility are, so to speak, in the same plane with his interests; and, above all, he knows that he is only one of many, and that it is only by collective action that his interests can be secured, his power exercised. But M. Cernuschi's customers,—without power or responsibility,—looking only to their own wretched individual bonus, have no such interest as the co- operative shareholder. This one, provided he can get his bonus, will be disposed to overlook defects both in quality and quantity, to brook any amohnt of rudeness or misbehaviour in the attend- ants, to flatter and fawn upon the management. That one, tak- ing no account of the necessities of trade, will expect to get every- thing as cheap as dirt, and then to receive whole nuggets of bonus. Nowhere will there be any sense of collective action, for there is no co-operation anywhere. As surely as an ordinarily well managed co-operative store tends to be the best establishment of its class, so surely does a mere bonus-dividing shop like M. Cernuschi's tend to be the worst.
But it may be said to me, Do not your objections reach the present practice of the Rochdale Pioneers, and of many other co- operative stores, of giving bonus to customers who are not mem- bers? I answer, There is this enormous difference between the two cases, that in the one case the practice is only grafted upon co-operation, in the other it is sought to be made a substitute for it. Such a bonus, where consumption is already co-operatively organized, has been found by experience not only to attract more customers, but to transform customers into members. But co- operative stores flourished long before such a thing was ever thought of, and many flourish now without it. And I believe these are the safest. In the long run, mere bonus-custom is only fair-weather custom, and a sudden accident or turn of trade may blow it to the winds in a day, and yet leave a store which has re- lied on it with all the responsibilities incurred towards meeting it. I think, therefore, that sooner or later it will be wise to limit such bonus, not only in amount, but in the duration of its enjoyment, so that after a certain time, which might be considered probation- ary, customers who have enjoyed the advantages of co-operative trade should be compelled to take upon them its responsibilities, by enrolling themselves as metnbers,—a process which might be made very easy, through a retention and capitalization of a portion of their bonus.
As respects the opposition which your reviewer rightly insists on as existing between the two forms of co-operative action now applied amongst ourselves to distribution and produc- tion, I may observe that it is a fact which has long been observed, which was discussed at length some seventeen years ago between my friend Mr. Vansittart Neale and myself, in the pages of the Christian Socialist, then the Moilear, so to speak, of co-operation, as the Co-Operator is now, and which has since been illustrated by such an anomaly as a strike amongst shoemakers employed by a co-operative store. But that in prac- tice these two forms of co-operation are not yet, as your reviewer would have it, "mutually destructive," is proved by some other facts which I commend to his notice :-1st. That whenever you find an association for co-operative production, you are sure to find amongst its members some who are also members of co-opera- tive stores. 2nd. That in every co-operative store you are almost sure to find men anxious to promote co-operative production. 3rd. That wherever co-operative conferences have met, delegates from both classes of bodies have sat together and acknowledged a com- mon interest. For what, again, your reviewer overlooks is, that division of profits of labour is not co-operative production, any more than division of profits upon purchases is co-operative con- sumption. Co-operation ,—fellow-work,—must underlie both, and it is that great fact, that great power, which unites the members of both classes of bodies together morally, even while they have not yet found means to harmonize satisfactorily their respec- tive machineries. But the defect of both machineries lies in exactly the opposite direction from that pointed out by your reviewer. "Co-operation," he writes, "is not arrived at" (i.e., in consumption) "unless the whole business of dis- tribution is placed in the hands of persons who are simply agents of the customers, paid by fixed salary." I answer that thorough co-operation is impossible so long as one "fixed salary" subsists, and that the "fixed salary" of shopmen, mana- gers, &c., is by far the commonest cause of failure in co-opera- tive stores, by hindering the distributing officials from thoroughly identifying themselves with the weal and woe of the concern, by tempting them to selfishness and dishonesty. So far from the "agent at a fixed salary " being the ideal of co-operative trade, he is the greatest danger of any trade. No sensible man ever employs an agent at a "fixed salary," and nothing more ; he seeks, on the contrary, to secure the honest and energetic discharge of the agent's duties, at least by the prospect of a rise in salary, generally by per-centages, discounts, or other means of binding up his interests with those of his employer. It is precisely the folly of co-operative stores in general that they have too often overlooked in this respect the teaching of commercial experience, and have expected immaculate virtue and boundless efficiency from their badly paid distributors, without holding out to them any effective incentives for the purpose. No; the opposition between our two forms of co-operation is to be harmonized only by the mutual interpenetration of their respective principles ; by the frank introduction of the bonus to labour into co-operative con- sumption, of the bonus on consumption into co-operative produc- tion. The way is being felt to this end already, and I have little doubt that within the next quarter-century the true economic formula for this new development of co-operation will be discovered and practised.
As to the system of co-operative distribution being, in spite of many accidental merits, which are to be attributed to the moral impulse of its promoters, "essentially a failure, having no advantage over competition, and being much clumsier in its working," it should really be quite enough to cite the names of Rochdale, Halifax, Manchester, Liverpool, &c., to refute such an assertion. Your reviewer is absorbed by the plutonomic error of confounding consumption with trade. The end of consumption is, after all, consumption itself, profit only its accident. If none of our great stores ever paid one farthing of dividend, they would still be successes, not failures, for they can secure to the con- sumer that which competition never can secure to him, the best of everything, in the fullest quantity, at the fairest price. That, in the process of doing so, however, they are able to realize a profit ; that in the distribution of that profit amongst large numbers of men they diffuse wealth instead of accumulating it, for the benefit of individuals ; that when they do accumulate wealth, it is always for the benefit of the many and not of the few, by the develop- ment of new modes of collective action, these indeed are " acci- dents " in their career, but accidents so common as to be almost habitual, and such as flow necessarily from their constitution, when they are managed with ordinary ability, instead of being merely dependent upon the will of individuals, as in competitive trade.
That, neverthelesss, "moral impulse,"—and something much stronger, steadier than mere "impulse,"—is needed to the genuine, permanent success of co-operation, I should be the last to deny. Such a truth flows necessarily from the position with which I started in this letter, that there can be no co-operation without co-operators,—living men, willing and able to work together, and stedfast in doing so. All that forms of co-operation can do is to supply the best means for such fellow-work,—a machinery which shall facilitate instead of marring the course of production and trade. We co-operators claim to have so far succeeded, that the co-operative store has solved the competitive discord of interests between the seller and purchaser of goods, that the co-operative factory or partnership of industry is in process of solering the dis- cord of interest between the seller and purchaser of labour. We are going further still already, nor do we yet know where we shall stop, or rather say, we dare neveiprop so long as we find one dis- cord of interests yet subsisting, capable to any extent of being solved, by human wit, by human faith, by human love, which hinders man from working together with man—and with God.—
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