News | Fund for Democratic Communities

Resilient Worker-Owned Coops Provide Good Jobs for the Long Term

Posted on April 4, 2013April 26, 2013 by Fund for Democratic Committes

Next Wednesday, January 26th, F4DC is hosting the second movie in its Film Series on people building grassroots economies anchored in communities. We’ll be showing SHIFT CHANGE, a film about worker-owned cooperatives, at 6 pm at the Carousel Theatre. Click here for more info about the screening.

If you’ve looked around our website a bit, you know that we’re excited about cooperative business as a key to rebuilding the economy. Here I want to say a bit about why worker-owned cooperatives, in particular, can make a difference. On the outside, they seem to function much like conventional businesses: they sell goods and services at a price that allows them to cover their costs (rent, labor, raw materials, etc.), and then some. Like any business, they have to make a profit; otherwise they have to shut down.

It’s this question of profit—its place in the grand scheme of things—that distinguishes worker owned coops from other kinds of businesses. Because the workers themselves own the business, they don’t make business decisions simply on the basis of maximizing profit, like most conventional businesses do (and all corporations are required to do by their very charters). A worker coop’s decision-making is based on the long-term need to sustain the business in a way that keeps providing the worker-owners with good jobs. So, for example, a worker coop isn’t going to up and move to a new location where lower wages prevail.

This isn’t to say that sometimes worker coops don’t have to make tough decisions, even cutting hours, wage rates, or jobs during tight times. This has happened at lots of worker coops around the globe during the current recession. But because the workers themselves are democratically making the decisions, it’s done with an eye to the long-term well-being of the workers as a group, rather than short-term profit-taking.

It turns out that this kind of long-term thinking and democratic governance leads to worker owned businesses having better track records for economic resilience, surviving downturns in greater proportions and making faster comebacks. This has been thoroughly documented in a study (pdf) that analyzed data from 50,000 employee-owned enterprises in 17 countries.

Contrast the inherent “long-termism” of worker-owned cooperatives to the “short-termism” of corporations focused on maximizing profit for shareholders who have no connection to the day-to-day operation of a business or the community in which it exists. Down the road from us, in Rocky Mount, the closure of the Merita Interstate Brands Bakery put 286 people out of work. That’s a lot of jobs in a town the size of Rocky Mount. If you followed the news last November, this closure was part of a national strategy by Hostess, the parent company, to liquidate all its bakery holdings, throwing more than 18,000 workers out of their jobs. Initially, the company tried to blame the liquidation on striking workers, but it later came to light that the company had long planned the closures, well before any strikes took place. Furthermore, Hostess had been owned and managed by a sequence of private equity firms that had no expertise or interest in operating an ongoing bakery business. They were essentially loading the company up with debt in order to pay outrageous compensation to top executives. Oh yeah, and they raided the workers’ pension fund while they were at it.

Could the Rocky Mount bakers – the people who actually do the work of the bakery—operate their own bakery? I don’t see why not: collectively, they know how to work in and operate a bakery, and people will always need bread. Sure, some work would have to be done to develop a viable business model and some money would have to be raised, but that’s what’s involved for anyone who takes over the business. It wouldn’t be the first time workers came together to revive a failed business: former workers at Republic Windows have formed a new worker-owned business called New Era Windows. They have raised money from a broad base of community supporters and unions so they can buy the now-closed factory and its contracts.

I am still weighing whether the strategy of converting failing corporate enterprises to worker-owned businesses can succeed at scale. Some people say that such businesses tend to have been mismanaged for so long that they make for very weak beginnings that are hard to overcome. Other people say that the existence of a group of skilled workers who already know how to work together makes for a good basis for a successful enterprise. It’s probably a case-by-case kind of thing.

In any case: come on out to see SHIFT CHANGE next week, and get inspired about the potential of worker-owned coops! Whether launched from scratch or as a conversion, worker-owned businesses need to be a big part of rebuilding our local economy!

Walking through walls, reflecting on the commons

Posted on April 4, 2013April 26, 2013 by Alyzza May

Lindsay St Mural in progress (via gsomurals.blogspot.com)

My name is Alyzza May and I am a pedestrian.

My main form of transportation is my body. I’ve never had a driver’s license, and get around by walking, taking the bus or train, and catching rides with friends, strangers, and loose affiliates. My great-grandmother’s name was May Walker, I wear the May in my name and the Walker, well as you can imagine, is a bit of a family heirloom, a state of being.

I walk for pleasure, for transportation to work, or to the bus stop when it’s raining or I have to go somewhere farther than I’d like to walk. I’ve walked in cities, towns, and rural landscapes all over this country. But what’s even stranger and more surprising a place that I walk, is Greensboro, where I’ve been walking for nearly seven years.

Walking in Greensboro has exposed me to the multidimensional nature of Greensboro’s character. People that drive register disbelief when they learn I walk around town. I get questioning looks from the drivers of passing cars while I’m walking. Greensboro is decidedly not a walking city, though traveling this city by foot over the past 6 and a half years opened the city to me in ways most people may not imagine. I have come to know the pain in Greensboro, the joy in Greensboro, and the possibility in Greensboro. By walking in Greensboro I have come to see how the city interacts with public space. These experiences contribute to how I have become an advocate for place-making and public art as a tool to reclaiming the commons.

As a pedestrian reclaiming the commons results in not feeling like I have to validate why I’m out in the public, on sidewalks, grass ways, or even the shoulder of the road. Reclaiming the commons is the taking back and re-establishment of commonly shared space, to have access to space, space that is more than just disregarded as in between space. In between in the sense that it is between where I am now, and where I want to be. In between is here, in between is now, in between is honesty, in between is where change happens, in between is often in public space.

As I walk in Greensboro, in this “in between” space, I see many canvases that are waiting to help bring people together, to brighten this fine city. These are the bridges made of walls. Yes, the canvases I speak of are the physical walls of buildings across Greensboro. For me walls are wonderful spaces for murals.The process of creating murals is one way to provide access to fine quality art that anyone can enjoy, critique, or even feel indifferent about, without having to pay an entrance fee or purchase price. By painting walls as a form of public art I believe the internal walls that separate us have the potential to be brought down. So two years ago I started doing just that, here in Greensboro. My friend, Kat, and I started interviewing what ended up being 300 people. We asked so many people the same question, “What would make Greensboro a healthy city?”

As you can imagine I conducted many of my interviews while taking the bus somewhere, or while I was walking down the street. These answers I am honored to have shared with me, and further illustrate the multidimensional nature of Greensboro. They show the beautiful imagination of Greensboro! So with the help of a seasoned muralist we set to work to capture as many of the answers about a healthy Greensboro as we could on a concrete canvas. Now we’re onto our second mural public mural at the Interactive Resource Center, a day shelter in Greensboro. The focus of this mural is home, and what makes home. Like the first mural we asked people about home, and the majority of the answers that we got were based around a sense of home. The emotion, characteristics of home were shared, but not necessarily that it is found in one singular place. Walking, in between, in transit, where the walls are painted, are all home. Creating these murals has begun the rebuilding and reclaiming of the commons with highlighting the presence in the in between. With each wall we are building home in Greensboro, we are making our claim to the city. Greensboro, a city I am glad to walk within, to call home.

For more information on The Greensboro Mural Project check out our website: http://greensboromuralproject.com

And consider supporting the “home” mural through our Kickstarter page: http://www.kickstarter.com/projects/846823987/home-is-where-the-mural-is

Economic Incentives? Yes, But Directly to the Community

Posted on April 4, 2013April 26, 2013 by Ed Whitfield

Renaissance Community Co-op

Despite what many people believe, there are not many ways for city governments to directly impact economic development in communities. Cities don’t directly start businesses that provide goods and services and create jobs. Cities will tell you that their job is to create and sustain the infrastructure needed by business, and then let the market take over. That means to let businesses be created where owners will profit, let sellers sell for as much as the buyers are willing to pay, and let jobs be created paying wages that allow investors an adequate return on their capital.

But there are clearly times when market forces are not adequate to provide the development that a community desires. If market forces alone were sufficient, someone would have put vibrant stores back into the Renaissance Center (formerly the Bessemer Center, located on Phillips Avenue in Northeast Greensboro) years ago. What developer after developer has found is that the projected return would not make their investment worthwhile. That does not mean that they could make no profit, only that they couldn’t make enough for their investors to be satisfied.

What the city is able to do in such situations is to offer incentives that ‘sweeten’ the deal for a developer. This benefit to the private developer is justified in the hope that it will lead to a pubic good. The idea is that incentivizing a developer will enable enough profit to justify the investment, and the community will indirectly benefit as a byproduct of the profits made by the developer.

That’s the idea, but things don’t always work out that way in practice. What often happens is that the city buys a distressed property at its market value. It is then made available to a developer at below-market rates, so that the developer can “improve” the property, and thus justify renting it at market rates to entrepreneurs who try to make their businesses succeed. In good economic times this might happen. But in rough economic times, like now, we often see a series of businesses moving in and then failing in newly developed areas. We end up with a lot of empty commercial space, run down business districts and underserved communities. In times like these, high rents can be the death of businesses.

On Phillips Avenue there is an opportunity to directly benefit the community by bypassing the below-market-rate deal to a private developer and instead making an incentive deal directly with the group putting together the community-owned cooperative grocery store. Incentivizing this group would facilitate a vibrant community business operation that would be the hub of future growth in the area. Unburdened by high rent, a coop grocery store could meet the need for convenient, quality food at reasonable prices and allow for surplus to remain in the community to enable additional economic development and further enhance the community.

The city should engage in a public/community partnership with the Renaissance Co-op Committee. This is the community group that is working to build a community-owned cooperative grocery store in the center. In this relationship, the city would agree to make funds available as grants and loans with negotiated rates and payment schedules to help make this project a success as they have done with private developers on other projects. With the reduced cost of business space, a well-designed and efficiently operated cooperative grocery store has a great shot at thriving and becoming an engine for economic development in the area.

We often measure economic development by the amount of capital we can attract. I think we should begin to measure it by the capital we can retain in the community. This is what can be used to enable job creation, satisfy community needs, and increase community wealth. We need to find better ways to measure local economic development activity so that we do not celebrate putting money into a community in such a way as to mainly facilitate sucking wealth out of it rather than keeping it in and building on it.

We have lots of money in our community like a river. But the money flows out as people spend to take care of their wants and needs. Currently money that flows through is gathered by investors seeking the highest returns on their investment. This causes them to seek to invest in areas where they find low taxes, lax environmental protection, and low wages—the very factors that damage communities.

We need to slow this flow. We need to construct dams to create the pools of money that can remain in our communities to be used for ongoing development. Cooperative economic ventures that are by their nature democratically owned and controlled provide a means to do this. When communities control the wealth that they produce they can use it to create jobs, meet community needs and elevate the quality of life even subsidizing the arts and recreation, environmental sustainability and community healthcare. With the proper incentives to the right people, the city’s economic development policy and practices can be important parts of helping this happen in the interest of the city as a whole. Public resources should only be used for public purposes, not to further enrich private investors.

Taking Risks and Packing a Parachute

Posted on April 4, 2013April 26, 2013 by Ed Whitfield

Felix Baumgartner jumps from the edge of space.

Most of us have never actually had to pack our own parachute, but it is not hard to believe that those who have packed it with great care. While we may think of sky-diving as a high risk activity, practitioners of the sport are extremely cautious and avoid any unnecessary risk. I would go so far as to claim that the risk that they take is less than the risk of walking across a busy street. Sky divers know what they are doing. They are very careful to make sure that they will have a functional parachute when they need it.

The rich often attribute their wealth to their willingness to take risks. I doubt that as a class they got rich by being less careful with their money than sky-divers are with their parachutes. I would be willing to bet that as a group, the wealthy spend a lot of time and energy getting to know the arenas where they operate, they take great precaution with their money and they assume very little risk. When business risk is assumed, it is such that the potential reward is so great when compared to the chance that they will get it that even winning some and losing some they still come out ahead. Well, so much for risky behavior!

What really characterizes the wealthy in not nearly so much their increased willingness to accept risk, but rather their heightened knowledge of ways to avoid risk, their increased access to the resources they need to put together profitable enterprises and a cushion of access to surplus money allowing them to stay in the game in spite of setbacks. These enterprises are dependent on the labor of others who are also risking failure by being involved in an effort which might fail but which will capture all of the surplus their labor produces if it succeeds.

But let me try to give a concrete example of the type of risk that the rich brag about., What would my return have to be to make it worth my time to gamble? First, we need to remember the difference between taking one chance on something, and repeatedly wagering over and over again. If I make one wager with 1-in- 5 odds and could only double my bet or lose it all, I would be taking a risk and I would have a likelihood of losing.

On the other hand, if I bet 5 times, I could expect to win once and lose four times. Betting $10, I will put up $50 and get back the $20 from my one win.. The net loss would be $30 for each average cycle of 5 tries. Now we should understand that in some cycles I might win twice and in others I might not win at all, but if the probability is accurate and the game is fair, overall I will win one and lose four each cycle of 5 tries.

Suppose though that on winning I can more than double my money. Suppose I could get $100 when I win and only lose $10 when I don’t. Then with the same odds, sin 5 tries I will on average win $110 and lose $40. That means that I put up $50 in my 5 bets and got back $110. I will have a net gain of $60 in each cycle of 5 tries. That is my type of “gambling”. There still might be times I win twice out of 5 tries, or even three times, and there might be times I don’t win at all, but in general if the odds are 1 in 5, over the long run I will make out well. Being knowledgeable about the chance and the size of rewards allows me to make a decision to engage in this situation, but not the first one with a 5 to one chance and even money. That is “knowing the game”, but is hardly taking a risk.

With the possibility of greater reward, it would be wise to take on even less frequent payoffs. For a $100, I would risk $10 even if the odds were 1 in 8 or 1 in 9. In the long run, I would still consistently win, putting up $80 or $90 and getting back $100. For a $1000 payoff, I would take on odds up to 1 in 80 or 90 for my $10 bet. In general, where the odds are more and more against me, I would still be smart to wager if the payoff was big enough to make up for the times I would likely lose.

One of the things we heard about the housing bubble was that financial institutions packaging mortgage backed securities made an effort to ascertain the risk of default on the mortgage so they could set the return on the package of securities in relationship to the risk. The idea was that the higher the risk was, the higher the return needed to be to make the purchase worthwhile. Packages were put together that had huge risks and were attractive because they had gigantic returns. The problem with the mathematics of this is that the greatest return will come from buying a security that had a zero chance—that is — no chance of being repaid at all. Many of these were sold because of the promise of huge returns, but when it became clear that the mortgages on which they were based would never be paid, then the giant bubble burst, and these high value securities became worthless – toxic, they were called.

So we have it that higher risk is worthwhile if the reward is high enough, but there is no reward high enough for something that will certainly never pay off. Unfortunately, many wealthy folks who engage in this logic with the idea of not really risking anything, in the long run, found themselves having given away everything until the taxpaying public was called in to bail them out and save the financial system. Now you have to understand how courageous that is. That is an even better way for the wealthy to ‘assume risk.‘: If they win, they get to keep it all. If they lose, we pay it off for them.

So my claim is that the financial practices of the wealthy are not particularly risky. Typically they have sufficient reserves to allow them to “stay in the game” until they win and they have calculated that the return that they get will be great enough to cover for their inevitable loses. When they miscalculate all this, they dump the loss on the public. That is not risk. What would be risky is to let a Wall Street broker pack your parachute or to take care of your safety net.

Police surveillance of law-abiding people undermines our democracy

Posted on April 3, 2013April 9, 2013 by Fund for Democratic Communities

The recent disclosure in Yes Weekly of surveillance activities carried out by the Greensboro Police Department on law-abiding community activists is disturbing, but not shocking. Let’s be clear: surveillance of law-abiding citizens is hardly new in Greensboro. Just ask any young Black or Latino man in town — virtually all of them (and many of their sisters) have personal experience with repeated, groundless traffic stops. In some of these stops, officers intimated violence (as in, “You can let me do this search now, or we can do it the hard way”) in order to get compliance with unwarranted searches.

This pattern of police behavior has become so normalized, everyone knows its slang name: DWB, or driving while black/brown. DWB’s ill effects aren’t limited to inconvenience or public embarrassment. These kinds of traffic stops are by their very nature imbued with the tension of unequal power — a setup for far more violent outcomes. Even when a traffic stop ends without violence, the threat is just underneath the surface (“the hard way,” mentioned above), adding to chronic fear and mistrust. In the county where we lost Daryl Howerton and Gil Barber – two young black men whose lives ended suddenly and inexplicably at the hands of police – this fear is certainly not baseless. DWB, and the mistrust and violence it engenders, is just one of the ways that some communities in our city are “occupied” by the police.

How ironic, then, to learn that the police “occupied” Occupy Greensboro, along with other activist groups in town. Of course, Greensboro is hardly alone in this: since 9/11 police surveillance of activist groups intensified across the country. In this period, police departments, sheriff’s departments and other law enforcement agencies acquired the tools, weaponry, and mindset of paramilitary units who are in a perpetual “war” with a range of “terrorists” who are purported to be plotting unspecified violence.

Problem is, Greensboro isn’t exactly a terrorist hotbed, so all this anti-terrorist fervor, personnel, and equipment has to be directed somewhere: heck, why not point it at those shifty radicals at the Peace and Justice Network or Occupy Greensboro? The information available to the public through the Yes Weekly articles indicates the City of Greensboro spends a considerable amount of time, energy and tax-payer money collecting information about the perfectly legal activities law-abiding residents engage in as they get together to try to build a better world. There are at least two officers (Finch and Flowers) dedicated to the task of monitoring these groups. With salaries, benefits, tools, vehicles, and overhead, that’s got to come to more than $150,000 per year.

Feel safer yet? We don’t, and a lot of our friends who are working for a more just, sustainable, and democratic Greensboro don’t either.

Here’s the deal: this kind of surveillance comes at a terrible price that goes way beyond the waste of taxpayer dollars — it undermines democracy in at least two ways. First, it has a chilling, divisive effect on community social movements. Activists can never be sure whether and to what extent their activities are being reported, recorded, interpreted, filed in some police file somewhere. Some of us “hard-core” activists came to grips with this reality a long time ago, assuming there’s a possibility of police monitoring of any meeting or event, and making a point of doing our work in hyper-transparent ways, just so there is never misunderstanding about our motives and means—in case the meeting/conversation/phone call happens to be recorded or otherwise reported on.

But to make any kind of a difference in our society, social movements have to grow to include many more people than the “hard core.” For the concerned community member who is thinking they might like to attend a community meeting or stand on a picket line, the prospect of being monitored is often enough to sway them to stay home instead. They think something like this: “A police file? Don’t criminals have police files? I’m not a criminal, so I shouldn’t have a police file! I better not get involved in anything that might lead to a police file!”

If that sounds a bit histrionic to you, consider that the 2012 National Defense Authorization Act (NDAA), signed into law by President Obama, has provisions allowing for indefinite detention of anyone suspected of engaging in terrorist acts, without even having to tell the person what they’re suspected of doing. In this terrorism-obsessed, suspicious climate, the possibility of having a police file – contents unknown to you – really is something to worry about.

The second threat to democracy is subtler, but just as real. It has to do with who is being monitored. It’s pretty clear from the articles in Yes Weekly that most of Finch and Flowers’ surveillance was focused on left-wing, progressive groups, despite the complete lack of evidence that these groups were engaging in criminal activity. This suggests that the police are picking their targets for political reasons.

This can’t be solved by simply adding some right wing groups to the monitoring lists, either — the inherently unaccountable and subjective way in which decisions are reached as to who to target flies right in the face of fair treatment and right of free assembly. Between the above-mentioned “chilling effect” and the use of political targeting, we are faced with a serious challenge to the democratic engagement of community members. Seriously not good for democracy!

In a followup interview after the first Yes Weekly article, police Chief Ken Miller said, “Intelligence isn’t all criminal but it helps us keep tabs with what may be creating risk for our community.” Risk? Really? If the police are monitoring risks, we can only hope they’re monitoring bankers and securities traders, whose risky “legal” activities destabilized our economy, causing massive unemployment and swelling foreclosure rates to over 300 per month in Guilford County alone. That was sarcasm — we don’t actually think they’re monitoring bankers and traders. Does this mean the only risks the police fear are community movements that challenge the status quo? Which side are they on, anyway?

Throughout all the revelations and discussion of police monitoring, the responses of Chief Miller and others in City government have been to suggest that there is absolutely nothing odd about this kind of monitoring — Everyone is doing it! It’s simply “best practice!” This normalization of anti-democratic police behavior in the name of combatting unspecified threats is really disturbing. As is the normalization of “driving while black/brown,” and all the other ways that the police routinely target black people, brown people, poor people, immigrant people, and young people.

We’re not exactly sure what to do about these latest revelations, and how to connect them with the decades-long struggles in Greensboro to end institutionalized police abuses. One part of that struggle continues Thursday night, April 4th, at 6:30 pm at the Greensboro Historical Museum, where the Beloved Community Center will be hosting a community meeting on the topic of cleaning up the police department.

We can also ask our elected representatives on City Council to get answers to a few basic questions about police surveillance, like these:

Who oversees the police department’s surveillance program?
Are the targets of police surveillance determined through any sort of approval process that includes an elected or otherwise publicly accountable party?
What is done with information collected through police surveillance on individuals or groups not suspected of or connected to criminal activity?

Whatever the answers, it seems important to stand up and say, NO! We will not tolerate unfair, anti-democratic abuses by the police. We do not accept that anyone in our community has to pay this price in order for some of us to feel a bit safer. This is not the kind of “normal” that Greensboro wants!

Creating a “Do It Ourselves” Economy

Posted on December 17, 2012April 9, 2013 by Alexandria Jones

Last month, F4DC hosted a film screening of “Fixing the Future,” where movie-goers had an opportunity to travel along with David Brancaccio across the country and back again, as he talked to people who are imagining and actively building their local economies through projects like time banking, local currency and cooperative businesses.

After the film, local panelists spoke briefly about just a few of the grassroots economy efforts going on in North Carolina. We heard from the Greensboro Chapter of Slow Money, a network of people in the Triad lending and borrowing money to grow small food and agricultural businesses; Bountiful Backyards, a Durham-based worker-owned cooperative that creates edible landscapes; and Greenleaf Coffee Cooperative, a student-run coffee shop at Guilford College.

There was a dynamic energy in the room afterward as folks chatted about plans and ideas they may have mulled over for months or even years. Several people spontaneously agreed to gather to talk about how time banking might work in Greensboro. And plenty of people talked about local projects already in the works, such as the Renaissance Co-op Committee (RCC), a community led effort to develop a cooperative grocery store in Northeast Greensboro. Hope and determination came together as this community of people were reminded in just a couple of hours that WE can build the new economy ourselves.

Lets build a new economy!

The conversations didn’t stop that night. In the weeks that have followed the film screening, I’ve overheard several people talking about rebuilding our town’s economy from the ground up, and had some of these conversations myself! In fact, my husband and I just took advantage of a time bank inspired exchange this weekend. We had a morning of hands-on learning from someone in our neighborhood who’s an experienced contractor. He’s agreed to help us with a home construction project that required a fairly high skill level. We’ve offered up a few possibilities for a trade and look forward to seeing which of the options he’ll choose for his exchange.

These creative and real ideas that are taking root in places across the country because they fill a need we have to feel a sense of community. It feels good to be able to offer our skills and benefit from those of a new friend. Most importantly, we are participating in a cooperative, do-for-ourselves approach to changing our local economies.

Movie-goers at the “Fixing the Future” screening made a clear request to learn more about cooperatives. In response, we’ve decided to host another screening next month. On January 16th, we’ll show “Shift Change,” a documentary film that tells the stories of employee owned businesses that compete successfully in today’s economy while providing secure, dignified jobs in democratic workplaces.

From the birthplace of the modern cooperative movement in Mondragon, Spain to cleaning cooperatives in the Bay Area, to North Carolina’s own Bountiful Backyards and Opportunity Threads, worker-owned cooperatives are creating scalable and replicable businesses that are changing people’s relationship to their work and local and regional economies in dramatic ways. Watch the trailer and save the date of January 16th!

Drafting cooperative statements at the United Nations

Posted on December 12, 2012April 9, 2013 by Alyzza May

2012 has a lot of meaning to people all over the world, from the end of the Mayan calendar, a US presidential year, economic turmoil, and the year my little sister became a teenager. For the billion people worldwide, who are members of cooperatives, 2012 means something else. 2012 was deemed the International Year of Cooperatives (IYC), by the United Nations. The IYC was created to spread awareness about the cooperative business model, especially as a tool in the realm of poverty reduction, job creation and other components of socio-economic development.

Mid-November brought the official closing ceremonies of the International Year of Cooperatives, to which I was invited to attend. During my time there I was one of a dozen youth delegates selected to meet and craft the International Youth Cooperative Statement (pdf). During the course of October, and early November, the UN solicited opinions on the role of cooperatives in young people’s lives. A majority of respondents were young cooperators, from across the globe. And it was the role of the dozen of us to compile all the feedback into a cohesive youth statement. No small task! So we got to work on the first day of the closing ceremony, and tinkered away until 1am to get the document to as inclusive, assertive, and complete a form as we could before presenting it the next day.

The process of crafting the International Cooperative Youth Statement was amazing. Young people from countries including Ethiopia, China, Ghana, Mexico, Canada, Germany, Argentina, and the United States worked together to draft the document. The statement recognizes that through co-ops youth can overcome many challenges that affect them ranging from unemployment, underemployment, disempowerment and disengagement. The statement is intended to be a document that is acted upon. So in crafting it we included recommendations for governments, policy makers, educational and research institutions, cooperatives, broader society and the international community in working together with us to address youth engagement in the cooperative sector. What is key is that as creators of this document, as young people, and as young cooperators, we also made a set of commitments that we, along with other young people, are going to carry forward. I see this as being crucial for the success of youth engagement in cooperatives, beyond the International Year of Cooperatives.

I urge you to read and sign on with support as either a youth signatory to the statement, or as a supporter and promoter of youth engagement and empowerment through cooperatives. You can do so through this link. And while you do so, jam out to the official anthem of the International Year of the Coop, found at the top of this post.

Interest-free banking is a practical tool for building community wealth

Posted on November 27, 2012April 9, 2013 by Sohnie Black

JAK Members Bank

I am happy to report that the old saying “there is more than one way to skin a cat” applies to the banking industry as well. Here in the U.S. we’ve been taught to believe that the traditional way of banking is the only way and there are few if any alternative models. Originating in Denmark in 1931, the JAK Members Bank offers banking services on a fee basis, free of interest. JAK is an acronym for Jord, Arbete, Kapital which in Swedish means land, labor and capital, considered to be the primary means of production in classical economics. JAK banks are democratic, member owned, cooperative financial institutions.

The creation of this banking model was based on the belief that assessing interest is a primary factor in economic instability. There are four principles that the JAK operates from, which are:

charging interest undermines a stable economy,
interest is the cause of unemployment, inflation and the destruction of the environment,
interest is a means of moving money from the poor to the rich and
interest tends to favor projects which deliver high profits over a short period of time.

Because the JAKs perceive interest to be such a detrimental force, they operate outside of the capital market and would like to see it abolished completely. In other words they want to see a financial world in which interest is nonexistent. Much like any other bank or credit union the JAK accepts deposits and makes loans all without assessing or paying interest or dividend shares. Their depositors or members earn savings points at a rate of one point for every dollar saved. As a feature of ownership each member is allowed only one vote, regardless of the amount of their deposit or accumulated savings points. Members may borrow money based on the amount of savings points they have accumulated.

For example, if a member has deposits which total $1200.00 (the equivalent of 1200 savings points) they may borrow $1200.00 dollars, at a monthly repayment amount of $100.00 dollars for one year. That same member would be allowed to borrow an additional $600.00 dollars with no increase in their monthly payments, if they agree to save an additional $100.00 per month over the same 12-month period. At the end of the loan period $600.00 of the savings is given to the JAK to satisfy the additional monies borrowed and the balance of $600.00 belongs to the member to use as they please! Over the course of a year the loan is paid off and the member continues to save money. It’s a win/win proposition. Monthly payments are often higher in the JAK than for customers at a traditional bank, however, because JAK members aren’t charged interest on their loans they pay less money over time. This example is illustrative of how necessary saving is to the interest free banking system, in that it insures the liquidity of the bank and also it’s ability to offer loans to many members at any given time. The staff and JAK administrators are all volunteers that donate their time in the spirit of cooperation. They are also the primary recruiters of additional staff and bank members.

The JAK banking system is very appealing to me for many reasons. First and foremost it is a counterbalance to the existing interest-focused system that provides no benefit to the average individual, but favors big business and the majority of the traditional financial services industry. It is a viable alternative to the existing debt driven economy, which we are learning is not sustainable in that it demands never-ending growth and expansion. Last, but not least the JAK Members model is a co-op where members have come together to create and sustain a vehicle that benefits them and serves their needs. The bank is owned by it’s members that pay a membership fee and vote for a board of directors to represent them and their interests. Each member, regardless of the amount of their deposit or accumulated savings points is granted only one vote. I can’t think of a better model of cooperation and democratic control in the financial arena.

More books, not less! Guilford County parents organize to oppose book bans

Posted on November 9, 2012April 9, 2013 by Fund for Democratic Committes

Guilford County residents protest book banning in our schools.

About a week ago, some Guilford County residents carried a petition with some 2,200 names on it to the School Board, asking to eliminate controversial books from high school reading lists. They targeted certain books, like Margaret Atwood’s The Handmaid’s Tale and Isabelle Allende’s House of the Spirits, objecting to sexually explicit passages and what they saw as anti-Christian themes. Actually, using these books as examples, they asked for the school system to revise the entire way it selects books, so that books like these would not ever again appear on reading lists.

Well, community dialogue and activism is alive and well in Greensboro! In response to this threat of book banning, roughly 30 people marched from the Central Library to the School Board meeting on Eugene Street, carrying signs that read, “More books, not less!” and “Let Our Children Read!” Here’s a picture of some of that contingent when they arrived at the School Board building. Many marchers then entered the meeting, where they addressed the School Board, making sure that the Board knew there was large crew of folks who like the book selection policy just fine.

Book banning is NOT the way to deal with controversy and difference. More democratic dialogue, not less! Hooray!

The Short and Happy Life of the Fund for Democratic Communities

Posted on November 7, 2012April 9, 2013 by Fund for Democratic Committes

We're spending ourselves out of existence. (photo: 401(k) 2012)

Here’s something you may not have known about F4DC: we don’t plan on being around after 2020. No, we haven’t subscribed to any end-of-the-world doomsday scenarios. In fact, quite the opposite: we’re thinking that the chance of human survival past 2020, perhaps even into the next century, will be improved if we go out of existence!

At this point, you may be thinking, “Whoa! These folks have a curious view of their destructive potential, not to mention their own importance!”

Let me explain.

The vast majority of charitable foundations come into existence under an assumption that they’ll exist forever — “in perpetuity,” is the legal term of art. Under this model, foundations put their money resources — “financial principal” (never to be confused with “financial principles!”) — into investments that deliver interest or dividends or capital appreciation at a level that allows them to give away some money each year, while preserving or even growing the underlying principal.

By law, foundations have to give away or otherwise spend on charitable purposes 5% of their assets each year. Thus, if a foundation has $8 million in assets (about what F4DC’s assets are valued at these days), the US tax code requires it to put $400,000 each year toward charitable purposes.

Here’s the deal. The world is in a real pickle, and dribbling out $400,000 per year just isn’t going to have transformational impact. And we need some transformation!

The global financial crisis is just one of several deeply disruptive, linked crises that together portend a level of environmental, economic, and social collapse that is already radically altering how we live. Whether we want to change or not, big changes are coming — some of them are here already (Hurricanes Katrina and Sandy!) — due to the intersection of climate change, peak oil, and the non-sustainable nature of a global, corporate capitalism that has driven the world toward the greatest wealth inequality ever experienced by humanity. People are hurting, struggling to support their families and communities, as jobs disappear and wages stagnate. Catastrophic weather events escalate in number and severity, pushing communities past the breaking point. Our representative democracy is under siege from corporate interests who are unelected and unaccountable. And our grasp of direct democracy (that is, our community capacity to dialogue about our needs and decide on collective action to meet them) is shaky at best.

In the face of the failing economy, many people are recognizing the need to build a new economy to take its place: one where people and planet come before profits. Where the rewards of productivity go to the people who do the work. Where communities are enriched, not stripped, by businesses that are rooted in place. An economy built on the principles of cooperation, sustainability and solidarity, not competition and exploitation. At the same time, people around the globe and at home in the U.S. are coming together to demand that the voices of the 99% be heard, and in the process are relearning and inventing from scratch new democratic forms.

We’re at a pivotal moment, a time of opportunity on the one hand and real danger on the other. F4DC is striving to put its resources — both money and people power — in service to the massive project of building a just, sustainable and democratic economy in this critical period. It’s a big project, and it’s sure to last way past 2020. But we think F4DC’s greatest impact—our shot at transformational impact—is in these next eight years.

If you’re wondering where this “eight years” figure comes from: Ed and I actually came to this idea of spending down our resources a couple of years ago. At that time, we gave ourselves a ten-year horizon line. Seemed like that was enough time to hatch and work on some serious projects, but also a short enough time frame to concentrate the mind. We’re two years in now, and believe me, the 2020 deadline does indeed concentrate the mind. Our entire staff is struggling to define what it would look like for us to leave a lasting legacy and evaluating whether our program and grant-making activities are on track to achieve it.

Stay tuned: we’ll have more to say about the legacy we hope to leave in later blog posts. For now, just know we’re working with growing numbers of people in our city, North Carolina, and the Southeast (link to the Federation of Southern Coops and SGEP) in ways that we hope position us all to be around a whole lot longer, even if F4DC is no more.

We picture a web of strong people, versed in democratic arts, who are able to work together to rebuild their communities. We see organizations, institutions, and networks across the Southeast that link and nurture democratically-minded economic and political projects that flow from communities that are usually pushed to the margins: Black folks, poor whites, Native Americans, women, immigrants, young people. Imagine a growing pool of autonomous people and organizations who understand that their well-being is tied to the well-being of all, and have a pretty clear idea of how to build a new economy anchored in vibrant democratic communities. We think of F4DC and its resources as part of the “seed capital” for this new venture.