The Moral Aspect of Co-operation

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    This document has been made available in electronic format
         by the International Co-operative Alliance ICA 
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                         June 1995

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                 Foundations of Co-operation
               Rochdale Principles and Methods
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               by Thomas William Mercer (London)*


The acquisition by the British Co-operative Movement of the
original Co-operative Store in Toad Lane, Rochdale, provides a
new opportunity for an examination of the principles and
methods of its founders. All the Rochdale Pioneers had
character. Had they lacked vision, courage, determination or
self-reliance they would not have embarked upon the enterprise
they started, and certainly would not have achieved success.

About the character of the Pioneers nothing need now be said,
for it is self-evident, plain for all to see. What needs
examining is the thought that informed their actions. Their
principles of organisation and the methods they adopted in
conducting their Society and Store still demand close
scrutiny, for about Co-operation, as about every organisation
of humanity, in time there gather legends until the light of
truth is at last obscured by old traditions and the dense fog
of unrecorded history.

The Rochdale Pioneers made public statement of their immediate
purposes and ultimate aims; they did not publish a statement
of their principles of action. Possibly they were too
practical to be philosophers; but it is obvious that he who
would know their principles must investigate their methods.
For it was in the methods they adopted that 'The Principles of
Rochdale' are made manifest, or rather, since it is necessary
to be exact, their methods were in reality the only principles
the men of Rochdale knew.

What, then, can such a scrutiny reveal? What philosophic
concepts are hidden in those methods as gold is hidden in a
rock? The Rochdale Pioneers were probably the first body of
co-operators to welcome all men and women into the fraternity
of their Society. No person had to enter into membership
through a narrow wicket-gate, and no man or woman who wished
to join their number ever was shut out. Here is a fact of
immense significance. Behind it lies the greatest principle
mankind will ever discover - the Principle of Universality.

On the day that the Pioneers adopted the method of 'open
membership' they laid the foundation stone of the
International Co-operative Common-wealth. Never while it holds
fast to this grand Principle of Universality, can Co-operation
degenerate into any form of particularism. Before the impact
of that principle all the barriers of race, colour, creed,
class, and party are broken down. Never can a Co-operative
Movement built upon the Principle of Universality be less than
universal in its scope, its purpose, its spirit, or its
appeal.

The Pioneers decided that the capital they used 'should be of
their own providing', that the method of '"one member one
vote" should obtain in the government' of their Society; that
all members, whether men or women, should have equal rights;
and that the powers of management should be placed in the
hands of officers elected periodically. These methods are
familiar today. They were less familiar in 1843, and were
probably then borrowed from the programme set forth in the
'People's Charter'. What secret do they hold? Those methods
are the very substance of the Master Principle of Democracy.

When the Pioneers included those simple methods in their rules
they made the original Co-operative Declaration of
Independence. They refused to hire capital from persons not of
their own body, for they were well aware that he who borrows
is a servant of him who lends, and they were not willing to be
enslaved to any money-lender. And what is even more important,
they recognised that Democracy is not only a form of
government, but also a declaration of the Rights of Man. By
the method they adopted the power to govern was given to each
member as a human being, irrespective of the amount of the
capital each owned. Long before States had learnt to
distinguish between the rights of man and the claims of money,
the Pioneers established the Principle of Democracy, as the
second basic principle of Co-operation.

It was only to be expected that the Pioneers would decide that
'only the purest provisions procurable should be supplied' to
members of their Society, and that 'full weight and measures
should be given'. Self-interest demanded that decision, for
had not the members formed the Society for their own
protection? Yet the adoption of these trading rules was more
than a proclamation of their common honesty. It was the
Pioneers' way of proclaiming their faith in justice, their
adhesion to the golden Principle of Equity. Justice is the
heart of true democracy, and it may be held that the one
principle supports the other. It does, and the entire
philosophy of Co-operation lies in the harmony of its several
principles, each of which is essential to the whole.

But it was not only in these rather elementary trade
regulations that the Pioneers applied the Principle of Equity.
They also decided that all 'profits' arising from the trading
operations of their Society should be divided among the
purchasing members pro rata to the purchases of each. In this
method the Principle of Equity is clearly to be seen. Justice
demands that no human being shall be robbed, either as
producer or consumer; and while this is not the place to
discuss the Marxian 'theory of Surplus Value', who will say
that by this method of distributing profits made on mutual
trade any worker can be exploited?

The Pioneers decided that in their store 'no credit should be
given or required'. What principles were they applying when
they made that simple business regulation? Magical as the
truth appears, it is the truth that they were applying three
foundation principles at one and the same time. However
otherwise credit-trading can be regarded, it is method that
necessarily creates additional expense. And the Pioneers
desired to cheapen the cost of goods, to eliminate all forms
of wastefulness so that their own needs could be more cheaply
satisfied. Economy was one goal they aimed at, and the
Principle of Economy is irreconcilable with debt. 

Moreover, the Principle of Equity had here also to be applied,
and how could justice be done if one member's gains were
another member's losses? 'Each for all and all for each' does
not justify any one-sided bargain. And how can there be true
democracy where equity does not obtain? As they formulated
their anti-credit law, the three Principles of Economy, Equity
and Democracy all ran together and stood foursquare like a
solid wall.

Latterly, or so it appears, some co-operators have been rather
inclined to belittle the value of the Principle of Economy.
Prosperity has made all familiar with big expenditures,
palatial buildings, and great stores made beautiful by glass
and brass and marble fittings. Yet there is still much virtue
in Economy, and co-operators of the present generation, even
while they must cater for the requirements of a newer age,
ought to be as economical as were the Rochdale Pioneers.

William King, whose own wise teaching influenced Smithies,
Ashworth and their fellows, observed that 'the saving people
are the friends of the world'; and at the end of an almost
universal orgy of unwise spending is there a single nation in
the world that could not profit by the example of Co-operative
Societies, ever anxious to adapt means to ends without
incurring unnecessary expenditure and so frustrating one of
the major purposes that the world-wide Co-operative Movement
exists to serve?

In planning the constitution of their Society, the men of
Rochdale, who had first applied the Principle of Democracy by
resolving that 'the management should be in the hands of
officers and committee elected periodically', also enacted
that 'frequent statements and balance sheets should be
presented to the members'. So familiar are all with that
simple rule today that co-operators commonly regard it as one
of small importance. But it embodies that Principle of
Publicity which is the surest safeguard of every democratic
institution. Wherever there is darkness there is falsehood,
concealment and corruption, and the roots of institutions are
poisoned by influences that would perish in the light of day.

Here is one of the fundamental principles that clearly
differentiate all true Co-operative Societies from the trust,
the combine, and the joint-stock company. 'Private
Enterprise', whatever form it takes, loves and seeks refuge in
the darkness, but a Co-operative Society is instinctively
compelled to apply the Principle of Publicity in the
compilation or publication of its reports and balance sheets
and in its general meetings. At times, perhaps, conditions
enforced by this principle are more than a little irksome; but
how can a society that departs from it retain the confidence
of its members or be justified in claiming that it 'provides
things honest in the sight of all men?' Disciples of the
Rochdale Pioneers who recognise the indispensability of the
Principle of Publicity are bound to propose 'secret diplomacy'
not only in national Cabinets and Chancellories but wherever
that enemy of Democracy and Equity is found.

It is less easy to discover the Principle of Unity in the
structure of the original Rochdale Society of Equitable
Pioneers or in any rule or practice of its founders. But the
principle itself is so conspicuous that it cannot be hidden.
What was the Society itself but a manifestation of the
Principle of Unity? A Co-operative Society must express and
demonstrate its members' will to unity or it never can be one
whit nobler than any petty chandler's shop. The principle that
is not expressly embodied in any particular rule or
established practice is in truth the one that binds that whole
together as with a golden cord. Co-operation can no more be
separated from the Principle of Unity than motion can be
divorced from power or air be parted from the wind.

And when this Principle of Unity was first wedded to the
Principle of Universality in Rochdale, Co-operation acquired a
mighty power of motion and the now world-wide Co-operative
Movement began to grow and move. For 'the Principles of
Rochdale' cannot be limited in their application. The
Principle of Unity that held together the original little
store in Toad Lane was destined to call into being, first, a
Co-operative Union and a Co-operative Wholesale Society in
every country and, secondly, the International Co-operative
Alliance and the International Co-operative Wholesale Society,
and will yet create the International Co-operative Bank, the
International Co-operative Transport Service, the
International Co-operative Press and all the different
economic and financial organs that will one day be needed to
sustain the structure of the International Co-operative
Commonwealth.

What other fundamental principle of Co-operation is there to
be found in Rochdale? It is the energising Principle of
Liberty. 'By night all cats look black', as Heine said, and in
periods of confusion, change and turmoil it is ofttimes
difficult to distinguish clearly between one democratic
movement and another, especially when all are unwisely 'lumped
together' and labelled 'the world-wide movement toward
Socialism'. Co-operators who proceed along the road mapped out
by the Rochdale Pioneers can never lose their way in the
welter of opinions and ideas if they hold fast to the
Pioneers' own Principle of Liberty. This is the principle that
differentiates Co-operation from Collectivism, Statism, and
all the new political movements that seek to find a short cut
to Utopia through the cast-iron gateway of the State.

When guarded and balanced as it was in Rochdale by the
Principle of Unity, the freedom of Co-operation can never
degenerate into any form of lawlessness or anarchy. It is
liberty within the realm of self-made and self-accepted law
and in this principle of Rochdale is the living soul of every
separate Co-operative Society and the world-wide Co-operative
Movement. Nowhere in a true Co-operative Society founded on
the Rochdale Plan can there be room for any element of
coercion or compulsion. Any person is free to become a member,
and every member is at liberty to withdraw when he so desires.
The member is under no compulsion to purchase from his
society, neither is the retail society under any compulsion to
purchase from the Co-operative Wholesale Society of which it
is itself a member.

There are co-operators who now hold that this freedom is a
cause of weakness, that it is imperative that individual
members should be compelled to purchase from their own retail
society and that the retail Societies in their turn should be
compelled to draw supplies only from the Wholesales. There are
weaknesses and disloyalties all co-operators must unanimously
condemn; but those who would limit the Principle of Liberty in
its application fail to perceive its ever-increasing value.

Liberty is the sole guarantee of continuing economic
efficiency in the Co-operative Movement. As long as the retail
society and the wholesale society are under the necessity of
securing patronage on their merits, by giving satisfactory
service and supplying goods not less economically than other
traders and suppliers can, there cannot be any serious fall in
their general level of efficiency. The Principle of Liberty
completely dispels that fear of 'the stationary State' to
which John Stuart Mill so often called attention. There is
risk wherever there is freedom, and every Co-operative Society
in the world is at times weakened by apathy and disloyalty
among its own members. But efficiency is not to be obtained by
depriving members of their liberty. Loyalty is strong only
when it is inspired by the enthusiasm and knowledge it is the
task of co-operative educationists to generate and spread. If
ever the Co-operative Movement should disregard the Principle
of Liberty it would cease to be a living movement, for on the
day it said farewell to freedom its own soul would be dead.

Judged by our modern standards, a majority of the Rochdale
Pioneers were unschooled and untaught men, workers who only
wanted to help themselves and improve their own condition. Yet
there was deep wisdom in all their methods. Unlike most
philosophers, the Pioneers were men of action. Nay, they were
Philosophers of Action; and he who would master their
philosophy, which is the philosophy by which the World
Co-operative Movement lives, must seek for it in their actions
- even in such simple acts as the sale of oatmeal, sugar,
flour and tallow candles! It may be that methods that had real
worth in Rochdale must be altered or replaced by others as
circumstances change. No peculiar sanctity attaches to any one
particular rule or system that was part of the original
framework of the Rochdale Plan. But the 'Principles of
Rochdale' must for ever be fundamental, and are as binding on
all their successors as a natural law.

Forms and methods must be changed or modified lest the
Movement should stagnate; but always the same test must be
made. 'Does this proposed new method, rule or system conflict
with the Principles of Rochdale?' is the question living
leaders of the Movement are in conscience bound to ask. If it
does, how can it be acceptable? If it does not, then no
question of principle arises, and the proposal can be examined
dispassionately, pragmatically, on the lower level of
expediency and convenience, for the only test which is then
applicable is that asked by common sense - 'Will it make the
Movement more efficient?' or more simply, 'Will it work?'

John Ruskin, in one of the most profound and searching of his
works, defined the 'Seven Lamps of Architecture'. The seven
'Principles of Co-operation' are the stars by which the
Co-operative Movement will always have to steer. Universality,
Democracy, Equity, Economy, Publicity, Unity, Liberty - these
are the fundamental Principles of Co-operation, and when all
are rightly fitted and joined together in one harmonious whole
the co-operator finds the philosophy he needs and the entire
Co-operative Movement is built securely on a solid and
unmoving rock.

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* Mr Mercer was considered by the late W.P. Watkins, the
well-known British Co-operator who died this year aged 101, to
be one of the most brilliant British exponents of Co-operation
of this century. He was also Will Watkins' predecessor as
Tutor at the Co-operative College. This article was taken from
the Review of International Co-operation, No. 9, September
1931.