References: Cooperative Commonwealth

Table of Contents

LUKE: Red was talkin’ to me a few nights ago about something called cooperative commonwealth.
STAR: What’s that mean?
LUKE: I ain’t sure myself about what the words mean, but I was thinkin’ it over in bed after I turned the light out and all of a sudden I got an idea of what it was all about…

Worker cooperative

A worker cooperative is a cooperative owned and democratically controlled by its employees. There are no outside or consumer owners in a worker cooperative — only the workers own shares of the business. Only one membership share may be issued to a member. One membership share is the equivalent of one vote. Membership is not compulsory for employees, but only employees can become members.

History of worker cooperatives

Historically, worker cooperatives rose to prominence during the industrial revolution as part of the labour movement. As employment moved to industrial areas and job sectors declined, workers began organizing and controlling businesses for themselves. Most early worker co-ops did not adhere to clear cooperative structures or ideologies. Starting in the 1830s, worker cooperatives were formed by hat makers, bakers, and garment workers.

In the United States there is no coherent legislation regarding worker cooperatives nationally, much less Federal laws, so most worker cooperatives make use of traditional consumer cooperative law and try to fine-tune it for their purposes. In some cases the members (workers) of the cooperative in fact “own” the enterprise by buying a share that represents a fraction of the market value of the cooperative.

When the current cooperative movement resurfaced in the 1960s it developed mostly on a new system of “collective ownership” where par value shares were issued as symbolic of egalitarian voting rights. Once brought in as a member, after a period of time on probation usually so the new candidate can be evaluated, he or she was given power to manage the coop, without “ownership” in the traditional sense. In the UK this system is known as common ownership.

Some of these early cooperatives still exist and most new worker cooperatives follow their lead and develop a relationship to capital that is more radical than the previous system of equity share ownership.

Trade Unions

Unions are often unnecessary in worker cooperatives as the workers have direct control over the management and ownership of the business – they are negotiating with themselves. Some worker cooperatives still choose to become members of local unions to demonstrate their support for the labor movement and to working conditions that have resulted from years of struggle. While an unusual situation, there is no contradiction in doing so. Worker cooperatives that join unions often benefit from the trade that comes their way from the community of union members and those who support unions for political reasons. The labor contract negotiated becomes the baseline of benefits due to the membership and guarantees to the community that the working conditions are not unfavorable. Union membership also guarantees that the worker cooperative will not operate on the basis of typical small business sacrifice, where owner(s) sometimes work overtime to keep their business afloat and expect similar sacrifices of their workers. Union membership for worker cooperatives gives the enterprise a legitimate standard of operations.

Firms converting to worker ownership may benefit from union membership because a union provides an experienced structure for integrating the needs of business with democratic influence from workers on management decisions.

Internal Structure

Worker cooperatives may have a wide variety of internal structures. Many co-ops use a hierarchical structure similar to that of a conventional business, with a board of directors and various grades of manager, with the difference that the board of directors is elected. Some co-ops, however, use a structure based on activist collectives and civic organizations, with all members allowed and expected to play a managerial role – and sometimes using consensus decision-making. Such unconventional structures may be associated with more radical political aims such as anarchism and parecon.


The United States Federation of Worker Cooperatives is the only organization in the U.S. representing worker cooperative interests nationally. There are local networks and federations throughout the U.S. in the San Francisco Bay area, Minnesota, Portland, Oregon, and Boston, Massachusetts, and the Pioneer Valley region of New England.

E. B. Gaston

gaston.jpgErnest Berry Gaston is considered the father of the Fairhope Single Tax Colony. Some of the more influential of the books he is known to have studied include Henry George’s “Progress and Poverty”, Edward Bellamy’s “Looking Backward” and “The Cooperative Commonwealth” by Laurence Gronlund. In the autumn of 1889, Gaston brought together a small group of friends to form the Des Moines Investigating Club — a club to “investigate” the social and economic condition of the United States by keeping its members informed on the latest thoughts on the subject. It was from Henry George’s ideas that the “Single Tax” concept seems to have sprung. Gaston and friends took this concept, mixed it with some of the Populist ideas of the time, added his essay on “true cooperative individualism,” threw in some good old common sense about the nature of humankind and came up with a constitution for the formation of a community. They renamed their group ” The Fairhope Industrial Association”; its name coming from a remark made by one of the members that the “idea had a fair hope of succeeding.” The group’s charter was “to establish and conduct a model community or colony, free from all forms of private monopoly, and secure to its members therein, equality of opportunity, the full reward of individual efforts, and the benefits of co-operation in matters of general concern.”

On the evening of November 12, 1894, the group left Des Moines Iowa for the deep South to create The Fairhope Single Tax Colony. For the next 40 years Ernest Berry Gaston labored to bring his dream of a better way of life to reality in Southern Alabama. Unlike many dreamers, Gaston’s efforts prevailed and the result exists today, still helping to shape the lives of the people of Fairhope, Alabama.


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