Cyclopædia of Political Science, Political Economy, and the Political History of the United States

Edited by: Lalor, John J.
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New York: Maynard, Merrill, and Co.
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Includes articles by Frédéric Bastiat, Gustave de Molinari, Henry George, J. B. Say, Francis A. Walker, and more.
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CO-OPERATION. This word in political economy, is a rejuvenation, so to speak, of the term association. By means of the propagation of Saint-Simonian, Fourieristic and communistic ideas, association, the benefits of which have been recognized by mankind at all times, and in all places, was offered as a panacea for all social evils, and as a means of producing general prosperity. Attempts at association were made in 1848, in France; the state even granted an appropriation to certain unions of workingmen, to facilitate the establishment of workingmen's societies. But as the greater part of these attempts at association for production were anything but successful, reaction set in against the idea of association itself.


—Somewhat later an association for production having been successfully operated at Rochdale, and Schulze-Delitzsch, having quickly called into existence popular banks and other associations in Germany, the idea of workingmen's associations found new followers in France, who advocated its application under three principal forms of associations of credit, associations for consumption, and associations for production. The public authorities, the people and the press were very favorable to the idea. Legislation promulgated a law, "on societies with a varying amount of capital;" Napoleon III. donated money from his private purse; and some economists and capitalists founded a bank, with a capital of 100,000 francs; and united with the workingmen to bring it into general favor. It did not, however, seem to make much headway. This is not owing, as some have said, to want of capital, for we have seen workingmen, by means of economy, accumulate capital enough to start them in business. We believe, rather, that workingmen do not enter into co-operation, for the same prudential reasons which deter a great many men from associating intimately with other men: they do not know them well enough; they fear to misplace their confidence; they foresee incompatibility of temper; they do not wish to renounce their liberty; and, if they feel able to do it, they continue to enjoy alone the fruit of their own ability. This last reason, which is perfectly legitimate, is not always openly avowed; it requires courage to expose one's self to the reproach of egoism. (Those who make this reproach are not more disposed to self-sacrifice than others.) Those who pretend to found society upon devotion and solidarity—supposing them to possess the virtues which they recommend to others—would wish to impose burdens upon the upper classes, for the benefit of the middle and lower classes, and this without any compensation, either to the individual or to society. What natural law can justify such a duty as this?


—But suppose co-operation, encountering no obstacle, were established, would the workingman be made happier thereby? We doubt it. Unless you associate together all the co-operative societies of the world, which would constitute universal slavery, and cause perpetual stagnation, competition would necessarily exist. Now, competition would not be less obstinate between associations than between individuals, we even believe that it would be more so, because a collection of men is always more passionate than an individual. The consequence would be, that the revenue of the workingman would be no better than it is now. It will be asserted, in reply, that he would add to his wages the profit which the employer receives under the present system, and that his well-being would be increased by so much. But, first, if we divide the employer's profits among his numerous workingmen, there would be but little for each of them, and, in case of a crisis, there would be nothing in reserve; secondly, if we set aside a part of the dividends to form a reserve fund, then the share of profit which each workman would receive would be so small that it would not be worth the trouble it causes. Besides, thirdly, the competition between the associations might easily become so violent as to destroy all profit; the workingman would live upon his wages as before; everything would remain the same, except that the reserve for a rainy day, and the saving which paves the way to something better, would be missing. If the advantages to be derived from co-operation by the workingman appear doubtful, those which mankind are to derive from it seem entirely of a negative character. Co-operation would hold men in the bonds of equal mediocrity. Intelligence, knowledge, skill, taste, superior force, would be lost to individuals possessing them, and consequently to society. If co-operation could become general, which seems to us impossible, the existence of science and art would be in danger; for these two delicate plants can thrive only in nations in which a certain number of men are dispensed from the necessity of manual labor.


—The true reason why co-operation is not generally adopted is, that the wages of the co-operators are necessarily contingent. Now, the vast majority of men prefer a fixed income to a contingent one, so that, if allowed the liberty of choosing they would seldom decide in favor of co-operation. The co-operative combination for production, called association, has these three inconveniences: first, the narrow community of interests with other men; second, its uncertainty; third, the impossibility de facto if not de jure, for the individual endowed with a superior degree of intelligence, knowledge and skill, to profit by his gifts. It is neither likely this system of co-operation will, nor desirable that it should, become general. It will be able to render some service in certain cases, and this service it has rendered at all times, under all manner of names, and it will continue to render them, whatever name may be given to the association—We shall, in conclusion, give the statistics of co-operative associations in the two countries in which they have acquired a real importance.


Germany. We learn, from the reports of M. Schulze-Delitzsch, that there were in Germany, in 1870, 1,839 loan or advance associations, (corschuss-rereim), 275 associations for production, and 750 associations for consumption; having in all, 314,656 members. The business transacted by them amounted to 207,618,387 thalers (more than $153,500,000). The capital actually possessed by these associations was 14,663,397 thalers (about $11,000,000). In 1871 the number of these associations had much increased, and, up to the present time, no cause of interruption in the prosperity of these German co-operative institutions can be found. By this, however, we do not mean that they are all equally successful, for there are some which have not succeeded at all: but, in general, their progress is rapid and constant. (See the reports of M. Schulze-Delitzsch.)


—We give these figures just as they are, but they should be closely examined. What is, for instance, a society which is pompously styled an association for production, when, as is frequently the case in the table we have before our eyes, it is composed of three, four or five members? It is purely and simply an association in name. Associations of three or four persons have often succeeded, but how of associations of two or three hundred? According to the system of M. Schulze-Delitzsch, the propagation of associations has been facilitated particularly by the popular banks, which do not appeal to the factory operatives, and do not, like the association for production, put all the interests of the members in common; their interests remain separate, and, what is of still greater importance, each one receives the entire profit of the product of his labor, his energy, his skill, his natural gifts. Would it be thus with associations for production?


England. In August, 1871, a parliamentary document, published on motion of Walter Morrison, informs us that, in 1870, England and Wales had 769 co-operative associations, with 230,000 members, having a capital of £2,060,000, and which had earned £333,000 net profit. The amount of purchases during the year had been £7,437,000; and of the sales £8,202,000. All things considered, the progress of these associations (for consumption) had been real and constant, although more than one of them had failed. The detailed report for the year 1870, a resumé of which we here give, serves to prove this: Number of associations registered, from their beginning to the end of the year 1870, 1,375; number of associations dissolved, 406; number remaining, 969. Of this number, 67 were begun—or at least registered—in 1870, and 133 were not reported, perhaps because not in active operation; which leaves 769, the number mentioned above.


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