Documenting Australian co-op history
PhD Thesis: Gary John Lewis, (1989), The Quest for a ‘Middle Way’: Radical and Rochdale Co-Operation in New South Wales, 1859-1996 (pdf): Thesis submitted for the degree of Doctor of Philosophy of the Australian National University, Vol II.

Edgar Parnell’s Prayer ‘Down Under’ (2001)
Published in the International Review of Co-operation, Vol. 94 No. 1/2001, presented to the International Co-operative Alliance, Europe, the International Co-operatives Research Conference, The Co-operative Impulse: Past, Present and Future, Oslo, Norway, August 2000.

In the early 1990s the distinguished UK co-operatives’ analyst and commentator Edgar Parnell, whose work has been seminal in re-inventing co-operatives, penned a Prayer for Co-operatives. Parnell’s prayer asked God to save co-operatives from misguided or unscrupulous academics (first on the list), professionals, advisers, managers, politicians, governments, dogmatists and investors, and to help co-operatives deliver benefits to members without transgressing the rights of those ‘outwith’ the co-operative. It hit a chord in Australia at the time, where cynicism is a national pastime.

My purpose is to explore some of the issues raised by Parnell in his prescient and witty piece in the context of recent events in Australian co-operatives’ history, specifically New South Wales 1985-2000. Discussion is of an exploratory nature, drawing upon work in progress for my forthcoming book ‘Australian Co-operatives in the Twentieth Century’. It is not intended as a critique of Edgar Parnell’s ideas, for which the present writer has high regard, or of the prayer itself, which has been employed simply as a unifying motif in research.

The period saw profound change convulse the Australian co-operative movement, wrecking much of it and changing the nature of co-operation forever. 'This was attended by a conceptual shift in thinking from generic ‘co-operation’ to structural ‘co-operatives’ in the broader context of a social economy.' It is timely, therefore, to consider a new prayer for co-operation, matching this paradigm shift.

Edgar Parnell’s Prayer for Co-operatives

God save Co-operatives:

Keep them from

• The Academics who wish to pull them apart to see how they work;
  
  
• The Professionals who believe that nothing can be achieved by ordinary men and women;
  
  
• The Advisers who never tire of finding new problems but never have time to solve any;
  
  
• The Managers who want a Co-operative to work for them rather than them to work for it;
  
  
• The Politicians who seek to use the Co-operatives as their stepping stone to power;
  
  
• The Governments that will bury them in bureaucracy;
  
  
• The Pedlars of Dogma who try to make them fit their view of the world and will not accept Co-operatives as economic enterprises (sic);
  
  
• The Investors who would take them over and cash in their assets.
  
  
• Help them to deliver benefits working in the interests of their members without transgressing the rights of those outwith the Co-operative.

First on Parnell’s list of ‘doubtful’ types are academics, who allegedly pull co-operatives apart to see how they work and leave it at that without making any further practical contribution. The reader is free to assess the merits of this judgement in evaluating the present paper. Perhaps Parnell noticed public moneys pouring into tertiary institutions ostensibly for co-operatives research but principally serving academic careers. This has happened in Australia, but the real problem has been the patchy and esoteric nature of research in the field beyond the concerns of primary industry.

The Australian Centre for Co-operatives Research and Development (ACCORD), which was formed in 1999 as a joint initiative of the New South Wales Government, the University of Technology, Sydney, and Charles Sturt University, Bathurst, presents a good opportunity to rectify this. At any rate, dissecting co-operatives to see how they work, especially if they are not working, may be useful post-mortem and the present writer thinks it is a legitimate function of a historian.

Parnell’s prayer seeks salvation from professionals who believe that nothing can be achieved by ordinary men and women. Compelling as this emotive idea is, the complexity of regulatory, legal and technical frameworks affecting co-operatives in Australia recently has necessarily driven co-operators and aspirant co-operators deeper into the arms of consultants and technocrats. It is a moot point whether professionals or ‘ordinary men and women’ shirking self-help responsibilities have been more culpable, but the former certainly has materially benefited. The only antidote: simple, user-friendly consistent national legislation for co-operatives or, dare I say it, federal legislation; remains elusive and requires a prayer of its own.

Parnell alludes to advisers, who never tire of finding new problems but never have time to solve any. Certainly, providing sophisticated advice, especially to a few powerful co-operatives, was a growth industry in the period, but advisers are not by definition problem-solvers or decision-makers - those are properly the functions of co-operatives, themselves. The problem was the incestuous nature of advice, where a few management consultants’ firms simultaneously advised governments on running a nation, political parties on policy platforms, departments on managing change, regulators on negotiating reform and co-operatives on improving business performance. Apart from obvious conflict of interest issues, the inbred nature of advice and the corporate world-view it confirmed produced an appalling homogeneity of ideas often irrelevant to co-operatives in the inhospitable market-driven, competition fixated environment in which they functioned.

Australian co-operatives’ history is littered with managers who have made co-operatives work for them, rather than the other way around. Classic cases are managers driving growth diluting the democratic base while demanding commensurate executive rewards, or engineering events to produce a demutualisation windfall for insiders. There are also many cases of ethical managers, genuinely committed to serving members’ interests, who have led co-operatives into oblivion through blind faith in the ‘cause’. Finally, managers are only as good as co-operatives make them.

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Few politicians used co-operatives as a stepping stone to power in the period, for that would have been like taking to the pulpit on the Titanic. A few did play the co-operative ‘card’ for targeted electoral purposes but more were brought undone through association with co-operative disasters and grew chary of all things ‘co-operative’. More commonly, economically powerful co-operatives cleverly manipulated the political process to achieve ‘back-door’ protection in rapidly deregulating markets in a last-ditch stand to avoid exposure to superior competition. There was much political sloganeering and rhetoric about a ‘Third Way’, allegedly heralding a renaissance of community values and social responsibility in which co-operatives had a flag to wave. Time will tell if this was merely a new spin on old ideas to mollify voters disaffected by the extremes of economic rationalism or the real dawning of a revitalized civil society.

Responsibility for regulating co-operatives in the period churned through government departments like worms in a compost heap, approximately eleven ministers taking responsibility for administering co-operatives, mostly short term, an educational toy for the acquisition of ministerial skills on a political carousel. The Registry of Co-operative Societies was periodically expanded, contracted, reviewed, restructured, re-tasked or buried in a ‘whole of government’ approach, a nice pun for the disappearance of co-operatives up the administration’s fundamental orifice, never to be seen again. Thoroughly creatures of statute and vulnerable to the vicissitudes of government support, the fortunes of co-operative development fluctuated inversely as political capriciousness ran ‘hot and cold’.

The experience confirmed what old Rochdale activists knew but our generation forgot: co-operatives require, and deserve, as much government support as is warranted by the contribution they make to the economic and social welfare of society – why otherwise would they, or should they, qualify for special taxation consideration?

Governments are required to listen reasonably to co-operatives in developing public policy and to assist them achieve their goals along with other constituencies in a pluralistic system. But what if the co-operatives are not talking to government, or to each other, or mumbling in a garbled voice, or if only a few politically powerful co-operatives can be heard? Governments are not so subtle as not to listen only to the most vocal and powerful players and to shape policies in their image. The economic preoccupations of hard-pressed agricultural co-operatives in pursuit of growth and market share in a period of intensifying competition set the shape of the overall movement, arguably retarding more general growth by skewing public policy and siphoning scarce resources in the farmers’ direction. But governments can’t be blamed for that. Where public policy is concerned, co-operatives get exactly what they deserve if they fail to properly shape it.

Rather than swarming bureaucracies, as such, the problem in Australia was that there were too many governments administering a plethora of sometimes colliding legislation and unable to agree upon a uniform code. This saw a stand-off develop between ‘states righters’ in the movement and the impeding of efforts by co-operatives to compete on an equal footing with interstate competitors (co-operative and non co-operative) and to optimise efficiencies at national level or capture international opportunities.

Powerful sections of the movement, wresting with potentially lethal industry problems, failed to give administrations clear signals in seeking to unravel a mesh of states’ law, a century in the cumbersome making. Indeed, some were not averse to the status quo. The tragedy was that state-based co-operative federations rarely spoke as one to federal government as governments periodically canvassed the co-operative option in deregulatory programs, stymied by legislative incompatibilities and interstate rivalries. Some administrations understandably came to see co-operatives as squabbling corporate anachronisms, heretics at the Altar of Efficiency, and marginalised them in policy debates. That was not burying co-operatives in bureaucracy; it was simply leaving them to rot in an administrative ‘too hard basket’ largely of their own making.

Who were the pedlars of dogma in the period seeking to make co-operatives fit their view of the world, as mentioned by Parnell? Certainly they were not those few fading souls on the margins who saw co-operatives as an embodiment of dual economic and social imperatives and prone to failure in the absence of one of those elements, and who perceived co-operatives as socially responsible vehicles acting for community development and not simply economic objectives. The dogmatists must have been those economic rationalists who locked co-operatives in an ‘economic enterprise’ box and dismissed social responsibility as ‘ideological’ or ‘woolly headed’, a reincarnation of those hard-nosed pragmatists who had crushed co-operative idealism and led the Rochdale consumer movement to near extinction in Australia in the sixties, those ideologues who successfully convinced the masses that democracy and business do not mix.

There have always been investors motivated to take over co-operatives and cash in on their assets. This period was no different, the usual opportunistic posse of ‘white knights’ and ‘cowboys’ galloping around the co-operative movement’s circled wagons, assuming the role of ‘lost leader’, extolling the virtues of co-operatives while demanding a radical overhaul of their structure in the interests of investors. Fund raising in pursuit of growth and market share was the rallying cry while the biggest fire sale of public and co-operative assets in Australian history proceeded, driven by governments of all hues and fuelled by a new ‘shareholder’ mentality demanding instant financial reward. Investors, including ‘dry’ (non-producing) shareholders legitimated by legal loopholes, demanded more than simply cost-effective services from co-operatives; they wanted wealth, now. A new generation of primary producers, whether legatees of co-operatively-produced wealth or a new breed of agri-businessmen and women with no allegiance to anything mentioned above the ‘bottom line’, saw co-operatives as archaic, even irrelevant, their task to woo investors and ‘grow’ the industry. The degree to which co-operatives or hybrid variations of the ‘business model’ served this purpose, ‘co-operative philosophy’ was endorsed. Taxpayers, who were also investors in co-operatives through their stake-holding in government development programs and favourable taxation treatment for co-operatives, went looking for the public benefit and ‘social dividend’ from co-operatives and found scant evidence, notwithstanding much rhetoric to the contrary. Big, trading co-operatives, ruled by economic imperatives, behaved just like capitalist rivals, rendering themselves ‘invisible’ in the market place. Why would taxpayers be concerned if private investors first assumed the burden of financially sustaining co-operatives and then took them over while governments retired gratefully from the field?

Somewhere within this Byzantine politico-economic panoply lay the ‘movement’, millions of people in heterogeneous co-operatives delivering benefits to themselves and, theoretically, to fellow members and the community. The extent to which they achieved this without transgressing the rights of those ‘outwith’, as Parnell’s prayer hopes, however, was problematical. Co-operatives never have functioned in a void. What co-operatives do inevitably impacts upon the community and not always benignly. For instance, without decrying the economic contribution and importance to rural economies agricultural co-operatives have made, how can they, operating in industries where current agronomies degrade the environment, not transgress the rights of those ‘outwith’? How can an organisation open only to anyone who can benefit from its services not by definition be exclusive? How could countless, diverse small co-operatives embodying most of the co-operative demography; the movement’s future; be allowed to drift bereft of movement leadership and institutional support while the needs of a few powerful co-operatives were slavishly indulged by governments blind to anything beyond the next election? Perhaps the question is not so much hoping that co-operatives do not transgress the rights of others; an essentially negative and elitist concept as Parnell has cast it; but asking God to help co-operatives actually to affirm the rights of those ‘outwith’. Wasn’t that why co-operatives were invented in the first place as entities distinct from profit-oriented business?

Meditating on recent events in New South Wales’ co-operatives history, the outline of a new prayer emerges, little more than a five o’clock shadow on the worn face of a work in progress. In this prayer, reference to structures known as ‘Co-operatives’ (with a capital ‘C’) is replaced by allusions to the generic ‘co-operation’, contemplated as an ‘impulse’ in a post-modern society where outcomes are rather more important than theory or structure.

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Employing Parnell’s typology, our evolving prayer seeks co-operation’s salvation from:

• Academics who paw over the entrails of co-operatives then consign then to the footnotes;
  
  
• Professionals who know all there is to know about co-operatives and nothing about co-operation;
  
  
• Advisers who imagine co-operation dwells solely in statute;
  
  
• Managers who think co-operation is like their ego – bigger is better;
  
  
• Politicians who periodically woo co-operatives for electoral advantage before flicking them back into the ‘too hard’ basket;
  
  
• Governments who cut co-operation to suit their ideological suits;
  
  
• Pedlars of dogma who narrowly confine co-operation to economic enterprise; and
  
  
• Investors who believe money is always more important than democracy.

Additional dramatis personae might enter our prayer with such likely candidates as:

• Co-operative members who muddle self-interest with self-help;
  
  
• Co-operative leaders who manipulate peak bodies to serve vested interests;
  
  
• Bureaucrats compromised by job insecurity or ambition from issuing fearless advice;
  
  
• Regulators who believe serving the public responsibly means never trusting them;
  
  
• Opportunists who transmogrify from (say) co-operative accountant, to management consultant, to director, to wealthy investor-shareholder of a former co-operative;
  
  
• Agri-business which exploits co-operation expediently as a bastion of protectionism; and
  
  
• The media who portray co-operation as a freak side show at the only circus in town: international corporate capitalism.
  

Rather than appealing for principles to be applied in structures known as co-operatives, our new prayer emphasises people and the impulse to co-operate for their own and others’ sakes. It asks God to help co-operators to join together voluntarily and make decisions democratically, to share outcomes equitably, and to help each other and kindred groups in caring for the community and the environment. It utters the heresy that this need not be confined to co-operatives; that co-operatives and co-operation are often antithetical; that big is not always better though small and numerous may be; and that a movement without movement is no movement at all – it is moribund.

Our new prayer ends with an impassioned plea for an Act of God to resurrect the best idea humanity has ever had – co-operation!
Pray hard.

(Copyright: Please note this article is the copyright of Gary Lewis and may not be copied in any way without written permission. For contacts regarding publishing rights, please write to maireid.sullivan@gmail.com)