Black History Year

The Power of Black Cooperative Economics with Dr. Jessica Gordon-Nembhard

Episode Summary

Credit unions, housing co-ops, CSAs... Black folks have been building and benefitting from cooperative economics for decades, particularly in parts of the economy where we’ve been cut out by the major institutions. As Dr. Jessica Gordon-Nembhard points out, we all participate in some form of cooperative economics when we use the informal economy. In this episode, we dig into the power that we could amass if we took cooperative economics to scale. BHY is produced by PushBlack, the nation’s largest non-profit Black media company - hit us up at BlackHistoryYear.com and share this with your people!

Episode Notes

Credit unions, housing co-ops, CSAs... Black folks have been building and benefitting from cooperative economics for decades, particularly in parts of the economy where we’ve been cut out by the major institutions. As Dr. Jessica Gordon-Nembhard points out, we all participate in some form of cooperative economics when we use the informal economy. In this episode, we dig into the power that we could amass if we took cooperative economics to scale. BHY is produced by PushBlack, the nation’s largest non-profit Black media company - hit us up at BlackHistoryYear.com and share this with your people!

PushBlack exists because we saw we had to take this into our own hands. You make PushBlack happen with your contributions at BlackHistoryYear.com. Most people do 5 or 10 bucks a month, but everything makes a difference. Thanks for supporting the work.  

The Black History Year production team includes Tareq Alani, Patrick Sanders, William Anderson, Jareyah Bradley, Brooke Brown, Shonda Buchanan, Eskedar Getahun, Leslie Taylor-Grover, Abeni Jones, Akua Tay, Darren Wallace and our producer, Cydney Smith.

For Limina House, our producers are Jessica Rugh Frantz and Sasha Kai Parker, who also edits the podcast. Black History Year’s Executive Producers are Julian Walker for PushBlack and Mikel Ellcessor for Limina House.

 

Useful links:

“Economic Co-Operation Among Negro Americans” by W.E.B. DuBois

The Freedom Georgia Initiative

Episode Transcription

The Power of Black Cooperative Economics with Dr. Jessica Gordon-Nembhard

GUEST: Cooperative economics is the economics of membership. It's created to satisfy a need rather than to satisfy profit maximization, and it's democratically governed, which means one person, one vote rather than one share, one vote. So it's all about the members who are running and owning together, making decisions together. And cooperative economics is the study of those kinds of enterprises.

 

HOST: The Credit Union, housing co-ops, the CSA: Black folks been building and benefiting from cooperative economics for decades, particularly in parts of the economy where we've been cut out by the major institutions. But as Dr. Jessica Gordon-Nembhard points out, we all participate in some form of cooperative economics when we use the informal economy. We barter with each other all the time. You help your neighbor by babysitting their kids when they need a hand, they give you a ride when your car is in the shop. You might shovel their snow, they might bring you a meal. Many of us do that. But what if we did this to scale? What if everyone did this? I'm Jay from PushBlack. And in today's Black History Year, Dr. Jessica Gordon-Nembhard walks us through how cooperative economics can play a major role in Black liberation. Just as there's been systemic economic disempowerment that is divided us and kept us from accessing capital and opportunity, Dr. Gordon-Nembhard has a vision for the ways systemic cooperative economics can lift us up, and help us move ahead.

 

JAY: Thank you for joining us on Black History Year. First question that we ask every guest here is what does Black liberation look like to you?

 

Dr. Jessica Gordon-Nembhard: Well, for me, Black liberation is a combination of us gaining political power and all the senses of the word political meaning self-determination, control of our own lives, and combining that with economic justice and economic democracy. So I don't believe we can gain real liberation if we don't have economic justice practiced through economic democracy structures. So that's for me, liberation is political and economic power, the power to enact self-determination in all aspects of our lives, but in particular, economic liberation and economic justice.

 

JAY: So how does your work in cooperative economics play into that? How are you using your work to push us towards liberation?

 

JGN: So I got interested in community economics, just for that reason, looking at ways that Black communities could be stronger, could we develop in ways that were meaningful, and that really put control in our own hands. But the notion that we know how to juggle costs, how to produce things, how to make economic decisions, but we're in the world we're in. We're usually marginalized if we even have a role in the economy and we're usually left out and oppressed. And so I was looking at structures that turn that on its head that changed things around. I first got introduced into just sort of community-based economic development, where communities have the say in things and we're at the table. But that clearly wasn't enough, because the table is often the wrong table in terms that we have the wrong economic structures to be at the table for and therefore our participation wasn't even real enough, or enough. So then I started looking at well, what are the actual economic ownership structures that would make a difference, that are much more grassroots that are based in humane values, that kind of thing. And so that's why I started learning about mutual aid, cooperative economics and solidarity economies. And so I now really have kind of combined all that and I talk about solidarity cooperative, economic commonwealth, where we're looking at structures and systems where grassroots people, the people who need the products, who need economic activity, get to decide what that activity is, own it together and learn how to do it democratically. To own it and practice economics democratically. So shared leadership, sharing the risks as well as the profits, sharing the decision making, learning how to do constructive criticism and conflict transformation, how to run your own companies, how to figure out production of the things we actually need, just putting all that together into this solidarity cooperative commonwealth. And so I just started studying all those movements, mechanisms, structures. When I realized that there were these structures out there that were viable alternatives to the regular sort of capitalist and sole proprietorship mode, I started looking for Black examples. And especially in the co-op community, those were hard to find at first. And so when I first started learning about cooperative economics and going to community development and cooperative conferences and stuff, I didn't see very many Black faces. I never saw Black examples. But luckily, I had a friend who had actually been studying W.E.B. DuBois’ economic thought and DuBois was also grappling with the same issues I was in lit upon cooperative ownership and what he called economic cooperation, which we now would call solidarity economics. So I started studying that with my friend Curtis Haynes. Really, it wasn't just the theory, once I realized we had a good kind of theory of what this could be and why we would do it, I wanted to also see what was happening in practice. And that's where I realized that I had to do the research because there wasn't a lot out there about Black cooperative ownership, Black mutual aid, there were scattered pieces, there were ideas of things, but I couldn't find coherent literature, at least academically. And when I talked to people out in the field, people couldn't articulate what was happening. So I went and did both. I started to look at what's our actual record? Where did we have co ops? What kind were they? How did they operate, what happened to them, that kind of thing. I also start to look at the economic thought. Who was promoting this kind of liberation economics, where it was coming from, what people were saying, how they were trying to get people to use it. I started bringing it up. When I talked to people, I tried to get people to think about what their ancestors, especially their parents, aunts, and uncles, grandparents had done, and resurrect some of the memories of doing this kind of solidarity economics. And so slowly over, you know, 15, 20 years, I was able to piece together, what is really actually a continuous history, from our roots in the early African civilizations to, you know, the first days of life as enslaved people here in the U.S.

 

JAY: Can you define cooperative economics for us?

 

JGN: Sure, cooperative economics is the economics of membership. So it's studying and enacting enterprises, businesses that are member, owned member run, member served. They’re values based—it’s values based, people centered economics, where the structures are about the people who need and use the services or make the products form the enterprise. It's created to satisfy a need rather than to satisfy profit maximization. It's about studying enterprises that provide quality goods and services for at affordable prices, in ways that engage people in working together to address the need and to run the business. And it's democratically governed, which means one person, one vote rather than one share, one vote. So it's all about the members who are running and owning together, making decisions together. And cooperative economics is the study of those kinds of enterprises.

 

 

JAY: That sounds wildly different than what was taught to me is what economics is, can you explain the key differences between cooperative economics and the mainstream economic approach?

 

JGN: Well, the mainstream economic approach is actually an approach about scarcity, how to manage scarcity, how to make decisions when you don't have enough money or enough of the product. That's what we call the neoclassical approach to economics. So economics is really supposed to be about how do we do all the things that we need to do to survive materially. And so as political economists, we've tried to resurrect that broader notion of economics as social reproduction, how do human beings make the things they need, do the services they need, exchange what they need with each other, make those decisions? And then those of us who talk about solidarity economics and cooperative economics take it even further. And look at these values-based relationships. So that how do we do that removing the hierarchy, removing the oppression and the inequality that neoclassical economics allows for and even perpetuates. How do we do these exchanges, reproduce ourselves, reproduce our societies in ways that are not exploitative in ways that are supportive and sustainable for human beings as well as for the planet, Mother Earth, because in for-profit capitalist companies, it's a matter of how much money you have to invest in the company and you invest in order to make more money. So you don't even really care what the company makes Or does, you care about whether it has a potential to make you more profit, and then how are you going to make profit by minimizing the costs and increasing the surplus. And that's where the exploitation comes in. To minimize the cost in a capitalist system, you're underpaying workers, you're exploiting the natural resources, you're not paying taxes or paying as few taxes as you can, all that kind of stuff in order to maximize your profit. In these cooperative solidarity economies, you're trying to maximize the benefit to the people, the members who came together because they needed a product or needed a service or needed access to capital or something like that. And so you're maximizing the benefit, not trying to undermine the inputs. Part of the benefit you're maximizing is so that the labor so that the land, the nature also benefits from what's happening. So you're doing things with like a triple bottom line. The final piece is this concern for community, concern for democracy so that everybody has an equal vote and equal say. You figure out in a cooperative system, how to make sure people have voice and that all people's voice matters, so that you can come to collective decisions in a way that helps everybody as much as possible. And some of us even go as far as to talk about thinking about abundance, that we're trying to manage abundance instead of managing scarcity. Basically, human beings can do almost anything we put our minds to, especially collectively. And so collectively, the way to reproduce ourselves is to think about the world as abundance and how do we manage that abundance so everybody has a part of it, everybody shares in it, we can all have prosperity, we're not trying to give some people special returns or special benefits or control.

 

JAY: So this stands out to me, because it makes me think of the Two Cradle Theory proposed by Cheikh Anta Diop. Are you familiar with this theory?

 

JGN: I'm actually not, I'm excited to hear about it.

 

JAY: You may have heard this in some other form. But essentially, it's this idea of how the European way of life was shaped and how the African way of life was shaped with Europeans being in a environment and climate where it was cold and treacherous and they had to look out for themselves and form this individual-based perspective, where as okay, just me, and then I'll share some with my family. But there wasn't these big communities, it was based on scarcity. I mean, if you're out trying to hunt or gather in the snowy climates then you're going to be looking out for yourself first, as opposed to African societies where if you're right there on the equator everything's in abundance, as long as you work together, everyone can have what they need. So it's interesting, because his theory is that this sort of identifies how the environment of ‘way back when’ shaped the systems that we exist in today. And so you know, you mentioned this idea of scarcity in the neoclassical economic system versus the abundance that you mentioned in the cooperative economic system that stands out to me is something that is distinctly European versus something that I see is rooted more of an African way of life. What are your thoughts on that?

 

JGN: So I have heard the theory. And I do find it compelling, especially in the sense of early African peoples also, First Nations peoples have that same sense of abundance even though some of those first nations were in very cold climates. So it's interesting that they were able to still have that notion of abundance and commonwealth, and even some of the Europeans have a little bit of a commonwealth notion, but I think definitely by the Industrial Revolution, or just before the Industrial Revolution, as the whole capitalist system is developing with the Industrial Revolution, it also developed with enslavement. And pretty much the construction of the notion of race came out of enslavement and capitalism and the Industrial Revolution. So all those together gave us neoclassical economics and neoliberal economics that we're in now, I am very much convinced that these notions of collective wellbeing and collectivism are really much more connected, as I said, to African civilizations and First Nations here on the western hemisphere. I also look at Chancellor Williams, he talks about how cooperatives with nature's first way of survival, that really nobody survived without cooperation. We know that by the time of the Enlightenment and the beginning of capitalism, Europeans kind of wrote that out of history. It's what individuals do that make you survive. But that's not really-- if you if you read history, if you understand how economics is work through history, you see that we've always survived because we work together no matter who we are. And I think it's important for me and my work for trying to get especially urban Black communities, but even rural Black communities, to embrace a different kind of economics, it's been important to connect back to those kinds of roots. To what are our cultural spiritual roots and then why are we willing to let our economic speech separate from our cultural spiritual notions of what we should be doing as a people and who we are as human beings. I've been trying to realign our economic values and structures to our humane spiritual values and structures. And that's where finding solidarity cooperative economics has helped me a lot. And that's partly why I got so excited about it, because it was able to bring that realignment back.

 

JAY: You mentioned that there weren't a lot of Black folks talking about cooperative economics, when you first started doing this work. How has that experience shaped the way you now approach this topic in conversations with others?

 

JGN: So, you know, over my 20 years in this field, I kind of have evolved myself. So I first started out talking more about sort of the benefits and the potential. Then when I got a lot of blank faces and a lot of naysayers, then that's where I went, Okay, let me go back into history and see if I can give examples so I can show that there's a legacy, so I can connect people. For a lot of that time, I would get a lot of people who are naysaying, but by the time I finished talking about the topic, I would get people come up to me afterwards, remembering something their grandparents were involved in, remembering something their aunts and uncles had done that was like this. So I also realized one of the barriers was just the words, the language, the terminology. So a lot of people don't know about solidarity economics and collective economics as co-ops, they only saw that as like a hippie food co-op or something. But once I started talking about what people did, how you joined together and created a credit union or credit exchange so people could have better access to a mortgage or a loan for a tractor or something or bought a tractor together, once I stopped using sort of the terminology, I got people much more starting to connect and remember something they had heard about. Once I was able to start giving the examples that I'd found in history people got more resonant, more excited about it. Now I also do I connect it much more to this values-based spirituality stuff that it actually allows us to reclaim our humanity, that language I sort of used only the last three or four years but that's what I'm really focused on now because I really believe that's what it's really about. Finding economic structures and ownership ways that really connect us back to being human beings, which means trying to help everybody, not trying to scam people trying to make sure we can not just survive, but prosper. But we have to want to prosper together. And the last piece that fell into place for me was also feminist economics. Feminist economics has forced us to look at invisible work, invisible value, the caring society and to realize that that's also part of our economics. So that also has allowed me to talk to people about, even if they're not in a co-op, we all practice some kind of caring, solidarity, economics, because we barter with each other all the time, you help your neighbor, you know, you might babysit for someone, and they might give you a ride, if they have a car, or you might shovel their snow, and they might bring you a meal or something. So we all do that. So that's the last piece I put, talking about how we all do this already, at least in the informal economy, if we sort of when we go into our jobs or if we own a business we kind of put all that we leave it out the door and we enter our business and forget about all the stuff we do as human beings and for humanity. But in the rest of our lives we are practicing these things already. So it shouldn't be that huge jump to then start doing in our paying jobs, in our paying world. In fact, it should make everything better. If in our paying life and our income generating life we don't have to ignore our humanity, we don't have to put it aside. If we can bring it into that world where we spend most of our waking lives anyway it'll actually make our lives better. But to see how we already practice some of these things makes it also not seem so far away. So not just that our grandparents did it, not just other people done in the past. But we're doing it every day in some level, even though it's not a paying job. So let's make it our paying job.

 

JAY: The idea of approaching it from a couple different perspectives makes a lot of sense. One thing that definitely stood out to me was the idea of framing it in ways that we may have seen or heard our parents or grandparents talk about. So like for me, my grandmother was a member of a credit union. Coming up I had no idea what that was. So could you dive into some of those examples that folks may be familiar about but may not realize as it connects to our history, specifically, and then, and then if you could, dive deeper into that history of what it looks like for Black people as far as the institutions and infrastructures, and even some of the leading figures that have advocated for. Like I know with DuBois, Garvey and many others talked about. So if you could touch on some of that history in ways that it has looked like in the past, that'd be great.

 

JGN: So just quickly, the stuff that we don't always see but that people are already involved in. So yeah, credit unions are financial cooperatives. A lot of people don't know that, who are even members of a credit union. But technically, it is a consumer cooperative. Your first $5 deposit into a credit union gives you membership, which gives you a vote for the board of directors and a vote on policies. Credit unions purpose, and they're not for profit financial institutions as opposed to commercial banks, which are for profit, right. So the commercial banks, their business, is to take your money, lend it out to somebody else at an interest rate and make a profit over it and make as much profit on the money that you're saving as possible. Sometimes even charge you fees for getting checks and all that kind of stuff. The credit unions purpose is to make sure that you have access to financial services in an affordable way and that you get as high a return on your deposits as possible. And so they're doing the opposite. And they're doing that because everybody's an owner, they don't have a lot of middle people and they don't have all these external investors who are wait just waiting for their dividend to get better. So we have a long history of Black credit unions. Some of them have been operated out of churches, some of them have been operated out of fraternal organizations. And so that's another reason why we've got a history of Blacks doing this because they're already in a church. And so if the church has a credit union, they might be in their church’s credit union and sometimes their union has a credit unions, teachers unions and others, right. So there's ways that were in there, but we didn't, we didn't pass it on. Similarly, housing co-ops, there's a lot of Blacks, especially in urban areas whose families have been in housing co-op. So they just think it's an apartment until maybe their grandparent dies. And they find out they actually inherited their grandparents unit in the co-op. And my family we talked about all this stuff, but they actually had never told me they had been lived in a housing co-op for a couple of years until I found the share. And I asked my father who was still alive and he was like, “Oh, yeah, I thought you knew that was a co-op!” You know, so I think there is that, you know, a lot of the times we've done it just matter of factly. But also, unfortunately, in our history, there have been lots of times when we've been either red baited for as communists or the people who have been involved in co-ops have been terrorized. And so a lot of times we don't talk about it or even tell our children it’s a co-op because we don't want to put people in danger. But yeah, W.E.B. DuBois, A. Philip Randolph, E. Franklin Frazier, Ella Joe Baker, even Harriet Tubman has an interesting relationship to a co-op from the 1860s. And even Martin Luther King tried to start a credit union. So he had some notion about co-ops. And pretty much every Black organization, even though again, they were usually known for other things. I can show you again, relationships to cooperative economics or some aspect of cooperative economics that they were involved in or at least mutual aid or promoting cooperatives or doing co-op development. So yeah, once you really look at the history through the co-op lens, you can actually retail the whole U.S. history, by looking at the Black Co Op movement, it's really fascinating.

 

JAY:  So DuBois says this quote that I'm gonna share, he said that “cooperatives by Blacks is the means by which the subtle but real ways that communalism of the African clan can be transferred to the Negro American group,” which I think is a great quote and I think also touches on some of what you were talking about as far as embracing that history and practical ways to embrace the history and culture.

 

JGN: Exactly. And let me give you another one of my favorite DuBois co-op quotes, because he actually is the only other person who's written a book about African American cooperativism, a whole book, a full length book. In 1907 he wrote his book. And in that book he talked about the need to recognize that we were at a crossroads between trying to follow capitalism as an individual and just get our own wealth and forget about everybody else or going the cooperative way, the roots of our ancestors and that kind of thing. And he was worried that we were all going the individualist route. And so he had a conference about Black businesses and cooperatives. He wrote a book, “Economic Co-Operation Among Negro Americans.” And he wrote a lot about how important it was for two things, one for the group, as you just read the group economy for us to do better as a group, we would have to use cooperatives. But he also talked about how the new industrial world was going to leave us behind, just like it had in the 19th century. But if we use cooperative economics, we would be able to be at the forefront of the next wave, the next economic wave. So he was also interested in promoting us as the leaders of the next economic wave not just trying to figure out how to survive and how to keep the group going. But my other favorite quote, by him is about the strength we can gain by using cooperation. And he said in 1933 in an editorial in the crisis magazine, he said, “We can, by consumers and producers cooperation, establish a progressively self-supporting economy that will wield the majority of our people into an impregnable economic phalanx.”

 

JAY: Wow. That's amazing. That's powerful. And that is describing power right there. I love that. So here we are today, over 100, what, 20 years since he wrote his book, and there doesn't seem to be a widespread embrace of these ideas. It seems that Black folks still are embracing the mainstream. And obviously, we've been taught these things, right, there’s reason that we embrace it, because we've been fed these ideas of what economics should look like. And right now we have an interesting movement that is talking about supporting Black businesses, buying Black, the promotion of Black capitalism and individual Black capitalists and putting them on a pedestal. Do you see any value in that at all?

 

JGN: So yes and no. So I'm not a supporter of what we call Black capitalism. I don't think Black should just be capitalist, I don't think that'll solve anything. I don't think anybody should be a capitalist. Hopefully, that was already clear. But I do believe buying Black, if buying Black is back to this solidarity, economics. And if we're buying Black through cooperatives and collectives using mutual aid, I do believe that, and, and that quote from DuBois illustrates part of what I believe also, which is this notion that especially because we live in such a racialized world, and because capitalism was racialized from the very beginning, that the only way for us to really prosper as a people is we have to first prosper together as Black people, because if we try to prosper economically in an integrated world, you know, institutional racism, racial microaggressions and stuff get in the way. And we've tried it, we've seen, right, the 20th century's pretty much that whole history of us trying to make it in the mainstream world. And even when people were sort of willing to sell us a house or let us have a business or be a member or work somewhere or become a manager somewhere, it was always begrudgingly, there was always still these stereotypes about us. And so until we can build ourselves up, be in control of our income, amass wealth together, raise the whole level of Black community, change all those notions. Until we do all that, we have to do that as a collective but maybe segregated in the sense of buying Black, having Black owned co Ops, that kind of thing. Because I don't think we can gain the kind of foothold and the kind of power, we can't level the playing field if we start from a non-level field, onto a field where everybody else always has the advantage, right. That beautiful fence-- three kids watching baseball, by a fence, I don't know if you've seen that. You know, the difference between equality and equity, right. The equality, you know, the equality is you give them each stool to stand on, right, but then the shorter kids still can't see over the fence, the equity is to give them a stool of the right size, so they can see over the fence and then the liberation is to get rid of the fence. So there is no fence. To me, to get even to the equity part, part of that giving people different size stools means we need to work together as a race in situations where we're not dealing with racism as much. Get strong that way, feed ourselves run our own companies, whatever gets strong that way. And then when we're strong, we can integrate and hope that the rest of the group, the Latinx people, Asian people, white people, are all changing their economies in the same way, from their equality and then all of us equal co-ops equal solidarity systems can then join into interlocking solidary systems, but we're all coming from a place of power, we’re all already feeding ourselves, prosperous, etcetera. And then it doesn't even matter if some of the white people or some of the other groups aren't evolved enough and still see us, as you know, lesser beings or whatever, we're already equal economically and strong enough economically so that we can integrate from a position of strength. So that's why I do believe in sort of buying Black in terms of predominantly Black owned, Black and brown owned businesses, because I think we first have to get ourselves established and strong enough to then be integrated properly into the rest of the economy. Because we're starting with such deficit with such marginalization with such oppression and such hierarchies, you can't address that, if we can't come from a place of strength first.

 

JAY: That also makes me think of an argument I've heard about coalition building, whether it's Black and brown folks, Black folks and Asian Americans or Black and white folks, it's like, you know, Black folks aren't approaching it from a sense of unity and strength internally, then it's not going to be as effective as it would if it was the opposite case. I appreciate you laying it out like that.

 

JGN: Right, we have to come from a position of power. We can't come from a vision of begging or inferiority and then say, they're just going to give us some power, whatever, it just doesn't work that way. That's not reality. That's not the system we live in. As much as they might want a different system, we live in a system that's already hierarchical and already privileges the people that have and if they're just giving crumbs back down and expecting that to be quality, that's just not going to work.

 

JAY: I want to talk about three specific things, how they relate to co-ops. So, unemployment, poverty, and wealth. Let's touch on each of those. Black folks, for if not most of American history have had the highest unemployment rate out of any groups. I think that's by design. Is this, is cooperative economics a system that would allow us to employ more of our own folks and take out the need to be asking for jobs from outside forces.

 

JGN: So it is a way to address unemployment from a couple of perspectives. There's a variety of different co-ops, but we're mostly talking about work around co-ops if you're talking about employment, and then consumer co-ops also employ people. And both those cases, if they're predominantly Black, or predominantly Black and brown, we already know that predominantly Black businesses tend to hire more Black people and we’re more willing to hire locally and hire people we know. That's the other thing. We know small businesses, getting a job is really about who you know. So because cooperatives are active, viable businesses in a community, they are going to be hiring people. And those people are going to be either members or people that the members know or people in the community. And so in that sense, they're a good way to address unemployment. We have actually some cities that have embraced that notion. So New York City, I think Chicago is moving toward that, Atlanta is moving toward that some other smaller cities are actually, have been learning about worker co-ops and see it as both an anti-poverty which I know is your next question and an employment opportunity. A lot of even immigrant service groups have started teaching cooperative economics because they realize it's almost impossible to get some of their immigrant clients jobs other places, they have really have to create their own jobs. And then if you think about, I guess we're calling it the fourth industrial revolution, just basically the digital age and the lack of work kind of things. The only work that really is is the kind that you make, that we have to make our own work. And that's again, where cooperatives look at a problem. They address the problem with an economic solution, and they hire people to participate in addressing that economic solution. But it's the local grassroots people, the members who decide all that. So that's why we talk about it as being a way to employ people, but also hopefully good jobs, because it's a values-based business. So it's not just a job. But hopefully, in most cases, especially if you, when I talk about solidarity cooperatives are ones that really care about community and making things better do good jobs, and then the worker co-ops in particular, that's their purpose is to have create high quality jobs that pay well, and help people to amass some wealth, which I know is your third question.

 

JAY: Thank you for that. So yeah, let's jump into the next one. How does cooperative economics address the poverty issue?

 

JGN: So again, there's a couple ways if you're talking about worker cooperatives, that's where the employees own the company themselves. One of the purposes of a worker cooperative is income generation, you know, so paying livable wage, good jobs, benefits if possible. So the whole purpose of a worker cooperative is to do that to increase the both the control and power that a worker has over their job, but also to make the job good. And then the third purpose of a worker co-op is to do something good for the community, to make sure the work is benefiting the community as well as the worker.

 

JAY: Could you describe an example of what that could look like and how it differs from employment situations that are not cooperatives.

 

JGN: For a worker cooperative, you have two major types, one type would be usually a large number of workers, like over 500 or 1000. And the workers, it's almost pretty much the same as a regular work, except that you get to vote on who the board of directors are, and you're an equal owner with everybody else. So you may vote on a board of directors who then votes to still have a manager. But because all the workers are member-owners, you're also working to make sure that the wages are good, you don't have a lot of middleman stuff, you don't have huge, usually you have what's called wage solidarity, you don't have huge disparities between wages, some worker co-ops even that have managers actually rotate the manager positions. So everybody gets a chance to make a little bit of a higher wage. And so there's that level of democracy. There's workplace democracy in terms of workers get to choose the work rules, like how you take a lunch break, what kind of vacations do you get, all those kinds of the work rules and stuff you get to have a vote on about that you get to weigh in about it. A lot of worker coops are also unionized. So they get both the benefits of being their own owners, but also being in a union. And so the day to day work might not be totally different, but sort of how you get paid, how you decide on work policies. And then the other real differences as an owner at the end of the year, if your company is profitable, you as an owner, get a share of that profit, and you get again, get to vote on how do you get that share? Do you get a bonus at the end of the year? Does your share go back into an account that accumulates over time, is some of the money go into making the working conditions better or building up the business better, right? But you're again, you're deciding on that nobody else is deciding that for you. And no outsider is getting the bonus, right, is getting the dividend. You're getting the dividend on your own work. So that's kind of how that works. If you're in a what we call a self managing or self governing worker co operative, then the day to day is even different because those co-ops, everybody's a board member, they don't have a separate manager, but they managed by teams by committees, that kind of thing. And so everybody might be doing the work but they're also doing the management part. And so that's much more even more democratic. There's lots of team decision making at the local committee level, there's a lot more even camaraderie in the workplace. And then as I said, you're not hiring an outside manager, everybody's taking pieces of the job. And so in those ways, it's much more democratic. In a regular co-op, like consumer co-op. The workers might not have as much say. That's where the consumers, the actual customers are the ones who own the co-op. And then they hire the workers, like in a food co-op. It's usually the consumers who own it, to say what kind of food and stuff they want, then they hire the workers. But still, because it's a co-op, they do usually believe in treating the workers well, trying to pay the workers well, there's again, still not a huge gap in wages, depending on what kind of work you do. And there's more of a sense of hiring people from the community, from the neighborhoods, from the membership, that kind of thing. So you usually get more the people who need a job, it's usually a relatively stable job, no one's trying to X you out or exploit you. And so there's those kinds of ways and then usually, but again, consumer co-ops aren't quite as democratic for the workers as the worker co-ops. But there's usually some sense of a living wage, a manageable wage, some kind of, you know, benefits if you're big enough to afford benefits, or that's where a lot of the worker co-ops, their union can provide benefits if they're too small. I don't know if I'm getting into too many details. But you were trying to ask sort of what the day to day looks like.

 

JAY: This really helpful. Thank you. I'm really trying to give folks a real world example of like, if they're listening to this and thinking about this, how it looks, how it differs from the current experience. So I appreciate the detail there. So let's jump to wealth. There's a lot of conversations going on now about individual wealth for Black folks, intergenerational wealth, closing the wealth gap. With the cooperative economics system how did those things factor in? Is it possible for individuals to build wealth in this system? Is it possible for our community to close the wealth gap through use of this system at scale? Or does that become a non-existent issue? If everyone is practicing this and all our needs are met on certain levels? What are your thoughts on that?

 

JGN: So you kind of covered all the ways that I talked about. Well, I'll start from the last one back down to the others, I think. So. Ideally, if we really had a full solidarity cooperative commonwealth, the commonwealth and the things we all did together should satisfy all our needs, make us all prosperous. And collectively, we should be wealthy, but not need to be individually wealthy. And a co-op commonwealth would include like co-op housing, so everybody had access to a house or an apartment, whichever one they wanted, but owned it together. There's community land trust, where everybody owns the land, and then or housing co-ops are you own the housing together, but everybody has a right to their unit. We already talked about sort of banking and saving, good jobs, especially if the worker co-ops can actually give you a dividend back every year in addition to your wage. So if we lived in a system where everything we did was some kind of co-op, some kind of collective, then we wouldn't really need to amass wealth as individuals. So it's hard for me to think about what else we would need wealth for. If we had, you know, universal health coverage as well through the co-op you wouldn't have health catastrophes. We wouldn't necessarily need extra money to own a vacation cottage or whatever, because I've seen some worker co-ops that actually invest in a vacation cottage and everybody gets a day or a weekend or whatever to go. I've seen hotels and stuff that are co-op. So you could still have hotels and resorts but they're owned by the workers. So you could have all the kind of luxuries that we think of but you could afford them through the commonwealth as a co-op system. So that's sort of the most ideal, maybe what we're looking for. In the interim, if we still have to live in this system and we don't have that set of interlocking co-ops, I still believe that co-ops are the way to go because they can help even individuals amass wealth in a variety of ways. If you look at agricultural co-ops, the marketing co-ops those are where you own your own farm, but you buy in bulk. You distribute what your farm produces, you add value to what you've produced, like a dairy farm. And in fact, we have lots of huge dairy co-ops which have made dairy farmers, white dairy farmers, millionaires, right? Land o’ Lakes is one of those. Ocean Spray cranberry. Those are individual farmers who come together to create what we call a secondary or marketing cooperative. The co-op helps them buy all their supplies in bulk, the dairy co-op processes, the cheese, the milk, the different kinds of milks, the butter, does the processing for you, and then distributes it. And so the co-op in that sense, helps your little farm to be productive and to operate at scale, by the larger scale because you're connecting with other small farmers and you're using one processing place. One co-op is processing everything so you have efficiency in the large scale, efficiency without you having to be by yourself as a large scale. So there's lots of ways that co-ops are already helping people with wealth, even the small worker co-ops. Cooperative Home Care Associates in the South Bronx, which is Black and brown home care givers. They are helping their members not just with living wages and union membership but they also help them to amass wealth, they give out an annual dividend based on how productive and profitable the company has been. Every year you get a dividend back on your ownership. You get a pension fund. They also help most of their members come into the co-op unbanked, they help their members to become banked. And they give them health care, childcare provision, other stuff like that. So they give them a stable job that addresses all their, pretty much all their needs. And so then they also get the fact that they get this dividend at the end of every year, that's the wealth part. The other part is just income. But the dividend part, the return back to your ownership of the surplus that's left at the end of the year, helps you to amass wealth in some ways and you can use that to save up to buy a car to get a house, to do whatever. So we do have examples of how even in this system, not changing anything else, except that you work in a worker co-op or operate through a co-op you can then amass wealth for yourself but you're also amassing wealth for the co-op which then helps more and more people. A lot of the co-ops also do give back to their communities in different ways. They invest in educational activities, sports activities, just like other businesses and so that also helps communities and so that we’re kind of the hybrid model, we're still in the capitalist system, but we're outside of it, and able to have group wealth and individual wealth.

 

JAY: I do love this idea of how it can benefit our folks in our communities, especially since we know that a lot of times businesses come into our communities in a very hostile to us either on a customer service level or even just the practice of taking the dollars of the Black community and going elsewhere is exploitative in itself and predatory. So I like the idea of pooling resources together to provide needs for the community in a different way and benefit from that in different ways. That's something that a community in Georgia is trying to do. Freedom Georgia. I saw you comment on this on CNN. So I'd love to get you to sum up like what's going on there. And what potential you see with Freedom Georgia

 

JGN: Well Freedom Georgia, what I know is that they're fitting right in with a tradition in African Americans of trying to figure out ways to create a whole town, whole society around collectivism. So we have the early mutual aid associations which try to address at least one thing, either burial or widow and orphan services or hospitalization or something in a way that everybody put their money in and then whoever needed it could get their money out. So we have that. We've got a long history of communal towns and collectivism from fugitives running away and starting these Maroon societies where they were making sure just to stay away from that toxic, exploitive society and do for themselves as a group. We still have intentional communities. Some of my friends live in one in Washington, DC called Ella Baker Intentional Community, which is an urban housing co-op but also an intentional community on top of the housing co-op. So it's not just a housing co-op but it's also people who are activists who want to live together who want to make sure they could still afford to live in Washington, DC. So they created this intentional community named after Ella Joe Baker, who's also, you know, civil rights leader, but also was the head of the Executive Director of the Young Negros Cooperative League in the 1930s. They were harking back to both her civil rights activism as well as her co-op activism. So they want to make sure in that gentrifying neighborhood in DC that they were securing housing for Black and women activists in particular. So we have that tradition. Now, the Georgia group is living up to that tradition, they are trying something even bigger, which is close to I think what I've been talking about this cooperative commonwealth idea where they could live together, farm together, have their own police system have their own, I'm assuming that having a credit union, that they would just run that whole economic phalanx, that DuBois quote I was talking about, self-determination through ownership and deliberate strategic planning. I think that's the other piece that's so important here about the deliberate strategy of collective ownership, that you don't just kind of fall into it, or even jump into it. Most of the co-ops I studied started with study groups, people came together and started learning together about this stuff, strategized about how to do it, about what to phase in first, like which co-op business to start first, when to do a credit union, what other co-op stuff would they need. So all that kind of planning and strategizing while you're teaching and learning together because also the learning together increases the solidarity and the sense of trust, which is so important when you're sharing money and doing all this collectively. Because we have to learn how to work together because it's been beaten out of us over the years. We've got to understand solidarity cooperative economics, we've got to learn how it applies in the way we're trying to use it. And then we have to strategize about how to phase it into our lives, how to create communities around it. And so they're, I think, doing what so many other Blacks have done, I'm excited to see what they're gonna do. I think a lot of people sound like they're starting to get the idea to try to do something similar. People are looking at the history of other examples. Mound Bayou, Mississippi did this before. I mean, there were also other Black towns that weren't trying to be cooperative. So that's the other piece that's really exciting here. They're not just trying to be a Black town, but really do this in a way that makes cooperation real and make sense cooperatively.

 

JAY: This sounds like an amazing idea. And it sounds kind of utopian, but I know it's not as easy as it sounds to set up. And I know it's probably not as easy to maintain. But what are some of the challenges that come with setting up this type of system? What have we faced in the past that has been sort of the red tape to getting this accomplished?

 

JGN: Yeah. So unfortunately, there's a lot of challenges. I'm going to talk I guess, probably about four or five of them, but the overlapping issue is racism and white supremacist terrorism. So the first challenge is capitalization and money, which is always a challenge for any business but even more of a challenge for co-ops. And for Black co-ops, one because Blacks have always had a problem with access to capital because whites haven't wanted us to have it, right? We didn't even own our own bodies when we were first brought here. So getting access to capital has always been an issue. Even in the 20th century, for Black businesses, most Black businesses have had to capitalize using their credit card balances, that kind of thing. They haven't been able to get capital, a lot of times banks won't give Blacks loans, sometimes the federal government wouldn't give Blacks loans. So we've had a capitalization problem, whether it's a co-op or not, but even co-ops have even worse problem. One, because they're seen as communist. Banks also don't understand collective ownership because we have a capitalist system. And so they understand, you know, individual or stock ownership. So often co-ops can't get loans, even credit unions had trouble giving loans sometimes because the rules that they have to follow, all were asking for one individual to collateralize something and co-ops, there isn't one individual, it's a group of people. And so there's those kinds of general issues. There's also specific sabotage against Black co-ops from banks, mostly white banks that didn't want the Black co-ops to succeed. So there are places especially in the south, but even in the north, where all the banks in a town would not lend to a co-op. In fact, they would collude so that they would all agree that they wouldn't lend to the co-op. In the early years when train was the major transportation we had times when trains wouldn't transport co-op goods. We have examples of insurance companies increasing the insurance on a co-op, especially Black co-ops. There was one that lasted for a very short time in Milwaukee, a cab co-op. And one of the main reasons it went under was because the insurance company quadrupled their premiums after the first year they were in business probably because they were the only cabs that went into the Black community in Milwaukee and the insurance companies decided that was too risky. But they have to have insurance to do cabbing. And the co-op couldn't afford the new insurance rates, that kind of thing. So you've got the financial challenges in general, then you've got the financial sabotage. Then you have generally white competitors, especially, again, when Blacks are forming co-ops to stop whites from exploiting them the white competitors get revved up and target the Black co-ops in a variety of ways. Sometimes it's just undermining their integrity and reminding people that Black don't do stuff as well as whites. Sometimes it's gouging them, changing the pricing, undercutting the pricing, because they can hold out longer, things like that. So that's a problem. Even a group like New Communities, which tried something in another part of Georgia similar to what Freedom Georgia is trying to do. New Communities, they weren't allowed to get mortgages from regular mainstream banks. They said some white community members poisoned their water, they had trouble getting their produce sold from their farm. So the definite, you know, people don't want them doing stuff. And then there's also a history of white supremacist terrorism. So there's examples throughout history of lynching of Black co-op leaders, and burning down the co-op establishment by white vigilantes who don't want them to succeed. Defacing and defaming the Black leaders of a co-op, and destroying the co-op that way, destroying people's trust in the co-op. One of the farmers co-ops, it was a national group in the 20s and 30s, they were using co-ops to help farmers and land farm workers to own land to buy their own tractors. And then they were doing bulk buying and selling so they're putting everybody's cotton produce together to sell it in bulk in Chicago. And one of the white newspapers started claiming that they were defrauding their members by charging dues. But if you actually looked at the data, they were actually saving their members 25% by doing all this bulk selling and buying and access to capital and stuff. But the white news article was trying to undermine them and get people to stop being members. So there's all that level, from just very despicable to sort of regular problems of small businesses. But luckily, there's also been a history of figuring out ways to overcome that. So that's the other reason why the co-op model is such a nice model because everybody only needs a small amount of money to put into the pool and then they can leverage that. You can also get neighbors and family members and community members to donate to the co-op and you can work that way. You know, I keep saying get rid of the middleman so they don't have a lot of excessive costs. There's a lot of learning by doing and sweat equity and stuff. So sometimes you can do a lot of stuff without having to pay out right or pay immediately your members to do stuff. So there's ways to cut costs that way, there's ways to get around the capitalization. And then the final thing that I found that really helped against all these different kinds of sabotage, was just community support. Even if everybody in the community wasn't a member of the co-op, as long as the community understood what the co-op was about, who were the members, what it was doing, the community often came in and protected the co-op. Sometimes physically with their bodies, you know, they brought themselves and their guns or whatever and protected the co-op from the vigilantes. Sometimes it was being the customers, right, being sure to be a customer, so the co-op could survive. Sometimes it was donating to the co-op, that kind of thing. Sometimes it was advocating for the co-op. So having community support and communities understand mattered a lot. And then the final piece that really helps in all this is organizations. So where you have a history of a Black organization that was promoting co-ops, doing co-op education, that you had more co-ops and stronger co-ops. In those cases, I found three periods in history that had the most Black co-ops: 1880s, 1930s and 40s, 1960s, and 70s. And in all three of those cases, one of the main notable things is the strong Black organizations that were also promoting co-ops and teaching cooperative economics. And so having those strong Black organizations at your back, teaching about it, supporting you having national connections, all that really matters.

 

JAY: Thank you for that. And so it seems that it's not just a practice of, you know, just setting up a co-op but we also need a cooperative, communal mindset and infrastructure in order to be able to protect these endeavors as well. 

 

JGN: Exactly. 

 

JAY: Thank you so much, Dr. Gordon-Nembhard. Thanks for joining us on the podcast.

 

JGN: No, I really I loved talking to you. It was a wonderful interview. I really appreciate it. You got me thinking about stuff and thinking about other ways to talk about this kind of thing. And I really appreciate it.

 

JAY: All right. All right. So just like that we're at the end of this episode of Black history Year. This podcast is produced by PushBlack, the nation's largest nonprofit Black media company. You know at PushBlack we agree with Marcus Garvey when he said, “a people without knowledge of the past history, origin and culture is like a tree without roots.” I'm guessing you probably feel like that's important, too. I mean, you're here at the end of a podcast about Black history. You matter. Your choice to be here matters. It lets us know that you value the work. PushBlack exists because we saw we had to take matters into our own hands. You make PushBlack happen with your contributions at BlackHistoryYear.com. Most people do about five or 10 bucks a month but everything makes a difference. Thanks for supporting the work. 

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