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UNITED STATES DEPARTMENT OF LABOR
Frances Perkins, Secretary
B U R E A U OF LABOR STATISTICS
Isador Lubin, Commissioner
+
Consumers’, Credit, and
Productive Cooperation in 1933
By
FLORENCE E. PARKER
B ulletin T^o. 612
UNITED STATES
G OVERNM ENT PRIN TING OFFICE
W ASHINGTON : 1935
For sale by the Superintendent of Documents, Washington, D. C.
Price 10 cents
Letter of Transmittal
U n it e d S t a t e s D e p a r t m e n t o f L a b o r ,
B u r e a u o f L a bo r S t a t ist ic s ,
Washington, June 20, 1935.
Hon. F r a n c e s P e r k in s ,
Secretary of Labor.
M adam S e c r e t a r y : I have the honor to transmit herewith the
results of a statistical study by the Bureau of Labor Statistics of the
cooperative movement in the United States. This survey covered
the 1933 experience of all types of cooperative associations in this
country, except the farmers’ marketing associations, data for which
are collected by other Government Departments. The widespread
interest in all types of cooperative enterprises makes the study of
especial value at this time.
This is the fourth study in this field made by the Bureau, the three
previous ones having covered the years 1920, 1925, and 1929.
The Bureau takes this opportunity to acknowledge with gratitude
the valuable cooperation of the societies which have supplied the
requisite data year after year.
Respectfully submitted.
I sa d o r L u b in , Commissioner.
h i
Contents
Page
Chapter 1.— Review of developments, 1929 to 1933____________________
Factual basis of report____________________________________________
Summary of operations in 1933____________________________________
Comparison with 1929_________________________
Chapter 2.— Consumers’ organizations______________
Local and retail consumers’ societies_______________________________
Characteristics of consumers’ cooperative societies_____________
Types of societies included in study________
Membership______________________________
Age of societies___________________________
Resources_________________________________
Business done by cooperative societies_________________________
Operating expenses________________________
Net savings or “ profits” __________________
Division of earnings_______________________
Wages and working hours_________________
Cooperative policies_______________________
Development since 1920___________________
Housing societies______________________________
Residential hotels_________________________
Insurance societies________________________________________________
Health association_____________________________
Chapter 3.— Central consumers’ organizations__________________________
Commercial organizations (wholesale societies)_____________________
Organization of wholesale societies____________________________
Membership and resources____________________________________
Business operations and results____________
Operating expenses___________________________________________
Working conditions___________________________________________
Educational organizations (cooperative leagues) ____________________
Cooperative League of the U. S. A ____________________________
District leagues_______________________________________________
Other federations_____________________________________________
Chapter 4.— Credit and banking societies_______________________________
Credit unions_____________________________________________________
Fundamentals of cooperative credit___________________________
Source of data________________________________________________
Number and age of credit unions reporting____________________
Membership__________________________________________________
Resources____________________________________________________
Requirements and procedure for loans_________________________
Business done (loans granted) during 1933_____________________
Interest charged on loans_____________________________________
v
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VI
CONTENTS
Chapter 4.— Credit and banking societies— Continued.
Credit unions— Continued.
Operating expenses___________________________________________
Interest paid on deposits______________________________________
Dividends_______________________________________
Development of credit-union movement since 1925_____________
Labor banks______________________________________________________
Mutual savings banks_____________________________________________
Building and loan associations_____________________________________
Chapter 5.— Workers’ productive associations__________________________
General characteristics of cooperative workshops___________________
Geographical and industrial distribution___________________________
Year of establishment_____________________________________________
Membership, employment, and wage policies_______________________
Capitalization and business________________________________________
Business methods and management________________________________
Development since 1925_______________________________ - ________
Page
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U N I T E D S T A T E S D E P A R T M E N T OF L A B O R
Bulletin o f the
Bureau o f Labor Statistics
Number 612
WASHINGTON
July 1935
Consumers’ Credit, and Productive Cooperation
in 1933
Chapter 1.—Review of Developments, 1929 to 1933
HE development of the consumers’ cooperative movement in the
United States has been greatly affected by economic conditions.
Depression apparently has had a greater influence than prosperity
upon the spread of cooperation—an influence which is adverse as
regards societies already in existence but beneficial as regards the
formation of new societies. On the one hand, with the main support
drawn from the wage earners, all cooperative enterprises are put to a
severe strain by the declining wages and widespread unemployment
attending a depression. The stronger societies with loyal members,
efficient management, and adequate reserves are able to survive, but
the weaker societies fail. Every depression, therefore, witnesses the
disappearance of a certain proportion of the associations. On the
other hand, depression conditions bring home to every family the
necessity of stretching to the utmost every cent of the dwindling in
come. It is under such conditions that the “cooperative idea” makes
its greatest appeal and it is not strange, therefore, that depression
periods have always been the most fruitful as regards the formation
of new societies.
The Bureau of Labor Statistics has been collecting data on the
cooperative movement in the United States since 1918. During the
17-year period two depressions have occurred, with the usual effects
upon the cooperative movement. Because of the long continuance of
1
COOPERATIVE MOVEMENT IN 193 3
2
the depression which began in 1929, the period from 1929 onward has
been an unusually difficult time, though not all phases of the move
ment have been equally affected.
Considering all factors, the showing made by the cooperative associ
ations in 1933 was relatively favorable. It is true that in comparison
with 1929 virtually all classes reported a marked decline in the volume
of business but in the aggregate the decrease is largely explained by
the lower price level. Moreover, a distinctly encouraging feature of
the 1933 survey is the fact that the average membership of several
classes of cooperative societies shows a decided advance since 1929.
Factual Basis of Report
the completion of the survey for 1933, there is now available
a 15-year statistical record of the business of the cooperative move
ment in the United States.1 Like its predecessors, this report is made
possible by the voluntary cooperation of those interested in the
movement and it is a pleasure to acknowledge the generous support of
hundreds of individual societies which supplied information. Detailed
statistics were furnished by the cooperating societies for 1933, but
information concerning the volume of business, net profits, patronage
dividends, and interest on share capital was also supplied for the
intervening years since 1929, when the last general survey was made.
Except for farmers’ marketing organizations,2 the present survey
includes all types of cooperative associations. Reports were received
from 725 local consumers’ societies, 9 wholesale societies, and 3 other
central organizations, 1,772 credit societies, and 8 workers’ productive
associations—a total of 2,517 organizations. Although the societies
supplying information constituted somewhat less than two-thirds of
the 3,888 societies known to have been in existence at the end of 1933,
they include virtually all of the largest and most stable organizations.
The reporting societies had a combined membership of 689,131 and
employed 4,795 persons.
W it h
Summary of Operations in 1933
total business done by the 2,517 reporting societies in 1933
amounted to $87,495,582. More than half of the total—$46,899,929—was accounted for by the local consumers’ societies. The busi
ness of the nine wholesale societies amounted to $8,748,726 and the
remainder was accounted for by the credit unions and the workers’
productive societies.
T he
1 Bulletin No. 531 traces the developments through 1929; other general surveys of the Bureau covered the
years 1925 (Bulletin No. 437) and 1920 (Bulletin No. 313).
For data on farmers’ marketing associations, see reports of the United States Department of Agriculture
and the United States Farm Credit Administration.
2
REVIEW OF DEVELOPMENTS, 1929 TO 1933
3
Although many of the cooperative enterprises operated at a loss in
1933, net savings or “profits” of $2,016,420 are shown for all of the
reporting societies combined. Part of this net gain—$1,361,909—was
returned to the shareholders in the form of patronage refunds and a
total of $1,179,231 was paid as interest on the outstanding share
capital.
The total resources of the societies for which information was avail
able amounted to $60,277,004. Of the total resources, $32,293,059
represented paid-in share capital and $7,132,888 represented accumu
lated reserves.
A statistical analysis of the operations and financial status of the
various types of cooperative societies in 1933 is given in table 1. In
order to round out the cooperative picture, the table also shows
comparable data for mutual savings banks, labor banks, and building
and loan associations, which, although not strictly phases of the coop
erative movement, are at least semicooperative in character.
T able 1.—OPERATIONS OF COOPERATIVE SOCIETIES OF SPECIFIED TYPES IN 1933
Type of society
Total
num
ber of
socie
ties
Num
ber of Number of Paid-in
Amount of
gain,
socie
Reserves Total resources business done, Net1933
1933
ties re members share capital
porting
Amount Amount
of inter returned Num Amount
est paid in pat ber of paid in
on share ronage em wages,
capital, refunds, ployees 1933
1933
1933
Cooperative
10 1
201 81
1
1 21
12 221
1
1110
1
10
1
2
2
20
1
8
$10,881, 422
1, 224, 170
5,770,907
228,825
1,188, 477
324,350
836
58,334
207, 466
19,631
3,151
2,940, 470
$14,372,118 $224, 167 $46,381 $169, 701 1,314 $1, 232,343
4,302 139 121, 760
2,325, 434
37, 252 13,698
21,017, 855 1,698,977 91,906 1, 054, 590 1,117 1,047, 088
,967
116 161, 578
408,366
1, 773,582 125, 601
385 675,000
398,942
1,382 133 132, 693
4,016
7,161
5,959
i 140
8,005
14,185
56, 276
13
2,496
i 902
25
32,850
61, 742
1,185
6,525
603
(3)
2,463
517
1,156
*6,007,152
23,782
76 115,664
« 446, 509
45, 532
e 14,960
22,848, 039
46,899,929 1,935,996
1, 207,169
725,128
17
8
(a)2
66
1
2, 787, 230
5,961,496
157,186 1, 253, 757 *3,394 3,585,169
10.3,429 1 18,487
63,933
4,265
65,096
43, 056
101
203
132,057
295, 246
4
24, 780, 336
35, 496, 668
55, 648, 655 2,103,358 179,938 1,361,909 *3,702 4,012,472
•28, 217,457
999,293
COOPERATIVE MOVEMENT IN 193 3
Consumers’ societies:
Local societies:
Store societies____ _________
235
878
76,160 $2,774, 664 $1,865, 751
Distributive departments of
35
6,590
635, 826 240, 728
marketing associations_____
176
Gasoline and oil associations. _ 616
398
127, 243 2, 395, 677 1,378,571
4
Bakeries.................... ................
, 618
33,845
19, 701
3
Creameries..................... ............
845,700 143, 525
3,950
Restaurants and boarding
4,752
92,233 214, 262
houses.......... ........ ........ ..........
550
Laundries__________________
Funeral associations_________
9
3,321
38
29,001
7,451
43, 750
Publishing societies_________
7
419
11,660
14,800
Water-supply societies_______
7
368
(J)
< 14
Trucking associations_______
1,905
1,156
9
7
100, 395
Insurance societies__________
Housing societies......................
48
840
950, 058
Hospitals_________________
, 602
81,000
Garage societies_____________
Cleaning and dyeing societies...
Social and recreational as
4
sociations......................... .......
Total, local societies............... 1,822
7328, 278 7,899,009 3, 882,805
725
Wholesale societies handling—
4
Household supplies_________
<636
560,132 146,326
Gasoline and motor oils.........
5
141, 353 226,456
<288
Other central organizations:
National, educational_______
<1, 498
f
26
Regional, educational...............
\
<49 }_..................
Total, consumers’ societies.. 1,864
737
7328, 304
, 600, 494 4, 255, .587
Credit unions........................................... 2,016 1,772
359, 646 22, 457,861 2,372, 711
Workers’ productive societies.
Grand total.....................
8
18
3,888 2,517
1,181 1, 234, 704 504,590 ^...........................
689,131 32,293,059 7,132,888
60, 277, 004
1,097 772,073
3, 629, 470 1 86,938
87,495, 582 2,016,420 1,179, 231 1,361,909 *4,799 4, 784, 545
Semicooperative
594
594 1012,734,892 890,000,000
4
4
1, 725,000
10, 727 10,727 9, 224,105
11,325 11,325 21,958,997 891,725,000
11
11,134,142,000 u 10,039,958,000
18, 653, 355
15,338, 505
6,977,531,676
436,421 18,129,859,892 ii 10,054, 686, 079
436,421
i Loss.
J One society reported a deficit of $3,250.
* One society reported 4 part-time employees, to whom it paid $1,400 in wages.
* Affiliated or owner societies.
*New insurance written.
« Total income for year.
f Individuals; does not include member societies.
* Not including 41 part-time employees, distributed, by type of society, as follows: Store societies, 29; distributive departments of marketing societies, 2; gasoline and oil asso
ciations, 5; water-supply societies, 4; and trucking associations, 1.
« Loans made during year.
Number of depositors.
Deposits.
110
REVIEW OF DEVELOPMENTS, 1929 TO 1933
Mutual savings banks----------Labor banks-----------------------Building and loan associations
Total. ...............................
Cn
6
COOPERATIVE MOVEMENT IN 1 9 3 3
Comparison With 1929
C
with 1929, the volume of business done in 1933 by
nearly all classes of cooperative societies for which information is
available shows a sharp reduction (see table 2). Part of the de
crease was due, of course, to the decline in the general price level.
But even after allowance has been made for this factor it is clear that
in several branches of the cooperative movement there has been a
serious dwindling of business as well as of dollar sales. Among the
workers’ productive societies, for example, as against a decrease of
somewhat more than 30 percent in prices between 1929 and 1933,
the volume of business of the cooperative shingle factories fell off
nearly 69 percent, and a decrease of about 66 percent is shown in the
business of the cooperative cigar factories. A sharp decline was
likewise reported by the cooperative laundry establishments; for this
group total business in 1933 amounted to $8,005, as compared with
$17,711 in 1929, a decrease of approximately 55 percent. The most
pronounced contraction of all, however, is shown for the funeral
associations, whose business in 1933 was less than a fourth of the
1929 total.
By contrast, the other types of cooperatives were relatively
fortunate. Three groups—shoe factories, fish canneries, and cream
eries—show an actual increase over 1929 in the volume of business
transacted. Indeed, the dollar sales of the cooperative shoe factories
in 1933 were higher than for any other year on record and the sales
of the fish canneries during the year were nearly 19 percent higher
than in 1929. The business of bakeries, restaurants and boarding
houses, and plywood factories was within 20 percent of the 1929 level.
Decreases ranging from 28 percent to 34 percent under 1929 were
reported for the retail stores, local gasoline and oil associations, and
the wholesale societies.
The trend of sales for specified types of cooperative societies from
1920 to 1933 is shown in table 2. The table also indicates the
average membership of the different groups of consumers’ societies
in 1925, 1929, and 1933.
om pared
7
REVIEW OF DEVELOPMENTS, 1929 TO 1933
T
a ble
2 .—TREND IN M EMBERSHIP AND BUSINESS OF SPECIFIED TYPES OF
COOPERATIVE SOCIETIES, 1920 TO 1933
A verage m em bership per society
Local consumers’ societies
Year
1925____ ____ _
_____
1929____________________
1933____________________
Restau
rants and Funeral
Retail Gasoline
and oil Bakeries Cream
eries boarding associa
stores associations
tions
houses
293
303
407
516
469
379
537
392
655
2, 432
3,950
285
679
524
474
Laun
dries
132
133
20
A verage business per society
$111,629
1920._
94, 294
1921____________________
87,422
1922.__________________
1923-_ .
_____ 90,418
91,371
1924____________________
1925____________________
95, 647
91,774
1926
_____________
90,112
1927
_____________
91,184
1928
_____________
90, 619
1929
_____________
1930
_____________ 108,290
1931
_____________
86,429
1932
_____________
68,311
62, 760
1933
_____________
$55,407
87, 454
47,684
82, 497
82,152
61, 707
78, 565
77,015
79, 266
66, 732
55,969
54,734
Wholesale societies
handling—
$95,239
84,500
84, 272
85,647
94,019
132,193
117,365
120,402
105,304
120,739
114,343
115,437
96,105
102,092
$844, 063
1, 670,694
3,106, 991
3,301, 592
3, 533,175
3,398, 659
3,341, 740
1,755,771
1, 717, 264
3,149,142
2, 639,854
1,990,339
1, 773, 582
$42,959
36, 441
47,954
66,813
65,092
55,331
93, 536
104,933
84, 297
78, 025
141, 494
106, 971
81, 639
66, 490
$29,526
32,413
26,454
26, 586
22, 200
8,970
6, 257
6, 253
$16, 042
13,990
13,208
15,877
21,063
18,893
17,372
18, 755
18, 735
17, 711
10,014
9, 510
8,960
8,005
Workers’ productive associations
House Gasoline Cigar
Shoe Fish can Shingle Plywood
hold sup and motor factories factories neries
mills factories
plies
oil
1920____________________
1921____________________
1922_ _______
1923_____________ _____
1924_______ __ _______
1925__________ _______
1926____________________
1927____________________
1928_____ _______________
1929____________________
1930____________________
1931____________________
1932____________________
1933____________________
1
Not reported.
$950,378
$17,345 $175,000 $1,019,054
608, 245
28,231
601, 298 $216, 613
632, 812 187,906 $536,854
547, 274
43,499 363,0 )000
658, 333
51,446 451, 000
723, 043 210, 771 924,812
735, 639
650, 756 220, 272 712, 275
44,998 627, 000
819, 840
749,192 235,150 743, 535
37,170 796, 000
1, 280,159 $2, 599,199 38,272 1, 092, 697
740, 774 179,472
0)
434,875 177,564
993, 281 1,868, 579 40,750 1, 264, 561
O’
1,133,939 1,845,932 30,641 1,374, 413
381, 266 175,869
0)
1, 291,358 2, 247, 349 27,553 1, 354,818
400,823 309,808 846,497
1,335,276 2,373,907 18,632 1, 284, 982
538,797 130,861 463, 792
1,108,089 1, 398,805 13,102 1, 388,177
348,418 81,686 391,338
892,130 1,175, 223 11,437 1,403,946
424,386 61, 216 444,443
929, 077 1,490, 374
9,399 1, 622, 616
485, 286 96,988 682, 603
Although the volume of business of the cooperative societies was
generally lower in 1933 than in 1929, the average membership of
several of the important classes of cooperatives advanced during the
4-year interval. The average for cooperative restaurants and board
ing houses more than doubled between 1929 and 1933. Gains of
more than 60 percent are shown for bakeries and creameries and a
substantial rise of 34 percent is reported in the average membership
of the cooperative retail stores.
The gains shown for these classes of cooperatives were partly
offset by a falling off in the average membership of the gasoline and
oil associations, funeral associations, and laundries.
Chapter 2.—Consumers’ Organisations
Local and Retail Consumers’ Societies
REM ARKABLE resistance to unusually adverse conditions is
revealed by the returns from the local consumed cooperative
societies.
At the time when the Bureau’s last previous survey was made
(covering the year 1929) the societies were just recovering from the
losses sustained during the depression of 1921. Even in 1929, how
ever, societies in the textile, mining, and railroad centers were report
ing difficulties caused by unemployment of their members, with its
accompanying loss of buying power.
The reports received in connection with the present survey reflect
the sudden and unexpected losses by both societies and their members
from bank failures, the consequent unusual demands upon the socie
ties for credit, the continuously increasing unemployment, and the
loss of purchasing power of members due to short-time work or total
unemployment or to wage cuts. These conditions have caused the
failure of a considerable number of the societies. Nevertheless, the
sounder and more stable societies have survived, and these, it is
worthy of note, have even been able to effect substantial savings for
their members. Many new societies have been formed.
The present chapter covers only the local consumers’ organizations,
i.e., those carrying on a retail distributive or service business. Most
of these societies are owned and operated by individual consumers.
A recent development has been the cooperative society owned by
other local cooperative organizations, such as a gasoline and oil asso
ciation, a burial association, a sausage factory, etc., operated as the
joint enterprise of a number of cooperative stores or other associa
tions. Many of the local consumers’ organizations are federated into
district, regional, and national organizations, either educational or
commercial, covered later in this chapter.
All the data were obtained by questionnaire. Tabulatable replies
were received from 695 societies.1 Most of the data relate to the
year 1933, but information for the intermediate years since 1929 was
requested as regards business done, net earnings, interest returned on
share capital, and amounts returned as patronage refunds.
A
The Bureau takes this opportunity of acknowledging with gratitude the assistance rendered by Mr.
H. Elsworth, of the Farm Credit Administration, in making available data for the cooperative oil
associations.
1
H.
8
CONSUMERS’ ORGANIZATIONS
9
The returns show a combined membership of 225,441 at the end of
1933, about 90 percent of the membership being in the retail-store so
cieties and the associations retailing gasoline and motor oil. Although
the average membership per society was 389 persons, over two-fifths
of the societies had fewer than 200 members and only 38 had 1,000 or
more members. As compared with 1929, the average membership
per society showed a considerable rise, that of the store societies
having risen by one-third. Of 142 societies for which membership
data are available for both 1929 and 1933, there were 65 which added
to their membership, 73 whose roster fell, and 4 in which it remained
unchanged. Notwithstanding the fact that the societies which had
been able to expand in size were fewer than those which had lost
members, the gains made were so great that the total membership
for all 142 societies showed a 9.5 percent increase.
Total resources of $19,907,569 were reported at the end of 1933, or
about $40,000 per society reporting. More than half of the societies
had assets of less than $25,000 each and 85 percent less than $50,000;
2 societies, however, each had resources amounting to a million
dollars or more. The share capital of the societies totaled $6,867,951,
or slightly over $12,000 per society and $37 per member. Reserves
to cover unexpected losses amounted to $3,882,805, or $9,956 per
society.
The business done in 1933 by the local consumers' societies aggre
gated $40,431,308, nearly three-fourths of which was done by organi
zations in the North Central States. The store societies and the oil
associations, being the two largest groups, naturally accounted for the
greatest proportion of sales (about 88 percent of the total). Although
there were 5 societies each of which had sales of more than half a
million dollars, nearly 60 percent of the organizations reporting had
a business for the year amounting to less than $50,000. During the
4-year period 1930-33, the local consumers' societies covered by the
study had total sales of more than $158,000,000. As might be
expected during this depression period, average sales per society
decreased each year, falling from $109,000 in 1930 to $60,000 in 1933.
Of 534 societies which reported the results of their trading opera
tions for 1933, 449 had a gain of $2,072,302, while 85 sustained a loss
of $136,306. There was therefore a net saving of $1,935,996, which
represented 5.5 percent if figured on sales and 23.5 percent if figured
on capital stock. The importance of the oil associations is shown by
the fact that whereas their business formed 52 percent of the total
consumers' cooperative business, their net earnings formed about 87
percent of the total earnings. In spite of the adverse business condi
tions, the societies were able to effect, during the 4-year period, trading
gains amounting to $7,419,999; of this amount $5,609,601 was
accounted for by the oil associations.
10
COOPERATIVE MOVEMENT IN 19 3 3
Many societies paid no interest on share capital for 1933; 259, how
ever, were able to do so, but of these 56 failed to report the amount
paid in interest. The 203 societies reporting paid the sum of $157,186.
During the period 1930-33 interest paid on stock amounted to
$631,423.
Refunds on patronage—the outstanding feature of the consumers1
cooperative movement—were paid on the 1933 business by 265
societies, in the sum of $1,229,975. During the 4-year period
$4,438,619 was paid in this way.
Thus, as the figures show, during the worst depression that the present
generation has known, when most investments have made little or no
return, the cooperative societies were able to save for their members,
in interest and patronage rebates, more than 5 million dollars.
During 1933, the societies reporting employed 3,252 full-time and
41 part-time workers, and had a pay roll for the year of $3,423,973.
The per-capita earnings varied considerably according to the line of
cooperative business in which employment was had, ranging from
$814 in general-merchandise societies to $1,753 in the one creamery
society reporting. The average earnings during 1933, all types of
societies combined, were $1,129.
That working hours required by the societies in 1933 were long, and
in one society shockingly so, is shown by the returns on that point.
Although the average weekly hours in the bakeries and miscellaneous
group 2 were 48 or under, the average in the store societies was 56.1
hours and that for all types combined was 54.0. The lowest weekly
hours reported by any society were 36, found in the oil group, and
the highest were 101.5, required in a general store. Classification of
the societies by weekly hours shows that two-fifths of the associations
had a 48-hour week or shorter, while 28 percent worked their employees
10 hours or more per day.
Characteristics of Consumers’ Cooperative Societies
T he consumers’ society in its organization varies little from coun
try to country. The following fundamentals laid down by the
Rochdale weavers have been adopted as guiding principles wherever
the movement has spread:
1. Unrestricted membership, with capital shares of low denomina
tion which may be paid for in installments.
2. Limitation of the number of shares to be held by any one member.
3. Democracy in government, with officers elected by and respon
sible to the members, and each member entitled to one vote only,
irrespective of the number of shares he holds.
* Including a creamery, a laundry, a water-supply society, and a publishing association.
11
CONSUMERS’ ORGANIZATIONS
4. Sale of goods at prevailing market prices.
5. Cash sales to avoid the loss attendant upon the extension of
credit and to enable the society to make the best use of its capital.
6. Return of dividends to each member, not on the stock held, but
in proportion to the amount of his patronage with the store.
Types of Societies Included in Study
T he great majority of the societies reporting were either retail
store societies or associations selling gasoline and motor oil. Reports
were received from 35 associations whose principal business is the
marketing of the members’ farm produce and livestock. In addi
tion to the marketing business, these organizations have a store
department which supplies the members with groceries, work clothing,
general farm supplies, etc. There are many farmers’ marketing
organizations which have a retail department dealing in supplies used
for the business (i.e., production) of the farm. As such goods cannot
be regarded as consumers’ goods, nor such societies as consumers’
societies, the associations in this category were excluded from this
study.3 The statistics in the present report relate only to organiza
tions handling consumers’ goods (groceries, clothing, house furnish
ings, notions, etc.); for the distributive departments of the marketing
associations, the figures cover only the retail, not the marketing
business.
The other societies are classified in table 3 according to their main
business activity. Thus, an organization which runs a store business
may also operate a bakery, a dairy, or a restaurant, but if the mer
chandising business is the principal line, the organization is here
classed with the retail store societies. Notations are made, how
ever, where several lines of activity are carried on.
Some data were received from 695 societies 4 classified (on the
above basis) according to type as follows:
Retail store societies_________________________________
Distributive departments of marketing associations_______
Gasoline and oil associations__________________________
Bakeries___________________________________________
Creameries_________________________________________
Restaurants and boarding houses______________________
Laundries__________________________________________
Burial associations__________________________________
Water-supply societies_______________________________
Publishing associations_______________________________
Trucking associations________________________________
Total________________________________________
* Statistics of the Farm Credit Administration cover such associations.
Reports were also received, but too late for use, from 5 store societies and a creamery.
144224°—35-----2
*
235
35
398
4
1
8
1
9
2
1
1
695
12
COOPERATIVE MOVEMENT IN 193 3
In addition, returns were received from 7 insurance societies, 22
housing associations, and a cooperative hospital. These are also con
sumers’ societies, but as they do not lend themselves to the same
computations as the other societies they are treated separately later
in this chapter.
The gasoline and oil associations are a development of the past
decade. They are found mainly in the Middle West, and chiefly in
the rural and farming sections where the cost of gasoline and motor
oils forms a considerable factor in the cost of crop production. The
cooperative boarding houses are formed among single men and are
found particularly in towns on the Mesabi Range, in the copper dis
trict of Michigan, and in the Great Lakes ports. Both of the watersupply associations reporting are on the Pacific coast in a region where
water is scarce and the supply must be piped in from a distance.
The burial associations, a comparatively recent development and
one mainly in the Middle West, have some interesting features. In
most societies the membership certificate entitles the member’s entire
family to burial service. Some societies provide that the certificate
becomes void upon the death of the person to whom it was issued
but in others it becomes void only when all the single children under
30, the parents, and all other dependent relatives have died. Prac
tically all of the societies have a “free burial fund” from which
assistance can be given when the member’s family is unable to pay
the cost of burial. The sources of revenue for this fund consist of
lapsed membership fees and an assessment of 25 cents per member
per year. One organization which increased its membership from
273 to 313 members from 1932 to 1933 reports that it is handling
some two-thirds of the funerals in its territory; 1933 was regarded
as a poor year, however, because of “the low death rate and low-cost
funerals.” Another reports that it conducts about 85 funerals a year
at an average cost of $220 per burial.
Table 3 shows, for the 463 societies which reported regarding
business carried on, the number of establishments operated in the
society’s main and auxiliary lines of business. As the table shows,
the 211 store societies reporting operate a total of 284 stores and 42
other establishments. Altogether the 458 societies covered in the
table run 894 establishments, including 284 stores, 499 gasoline filling
stations, 12 fuel yards, 19 restaurants or boardinghouses, 10 bakeries,
9 undertaking establishments, and 8 dairies. Other enterprises oper
ated by these societies include a pasteurizing plant, a garage, a trucking
business, a printing plant, a laundry, a bar, a dance hall, a club room,
an ice-cream parlor, a bean-cleaning plant, a tailor shop, a huckster
truck, and a workers’ center.
13
CONSUMERS’ ORGANIZATIONS
In addition to the usual lines of goods generally carried in their
particular line of business, 4 societies carry dairy products, 1 society
carries delicatessen goods, 6 bakery goods, 1 beverages, 2 ice cream,
1 medicine, 30 dry goods, 15 shoes, 4 clothing, 4 men’s furnishings,
2 notions, 2 furniture, 1 rugs, 2 crockery, 34 hardware, 18 machinery
and/or implements and tools, 44 farm supplies, 7 building materials,
4 paint, 4 “forest products”, 1 explosives, 12 produce, 2 wool, 4
tires, 30 coal and/or wood, and 30 gasoline and oil.
Very little production is engaged in by the consumers’ societies.
Only 24 societies reported any activities in this line. Of these, 8
manufacture poultry and/or stock feeds, 1 does wheat and rye milling,
7 manufacture bakery goods 5, 3 make sausage or smoked meats, 1
makes ice cream, 1 butter and cheese 6, 1 biscuits and rye hardtack,
1 bread, and 1 custom-made clothing.
T
able
3.—BRANCHES OF BUSINESS ENGAGED IN BY CONSUMERS’ COOPERATIVE
SOCIETIES
Type of society
Retail store societies dealing in—
Groceries______ ___________ ____________________________
Groceries and meat__________ ___________________________
General merchandise____________________________________
Fuel____________ __________ ____ ____________________ _ .
Students’ supplies...................... . ..............................................
Tntfll
Distributive departments of marketing associations________ ____
Gasoline and oil associations.......................................... .......... ............
Bakeries_______________ ____________ ___ _____ ___ _ _______
Creameries_________________________________________________
Restaurants and boarding houses.__________________ _________
Laundries_____________________ ___ _________________________
Funeral associations_________________________________________
Publishing societies______________ ___ _______________________
Tracking associations___ ____ _____ _________________________
Grand total_____ __________ ______ ____ ________ _______
Establish
Number of ments
Other es
societies operated in tablish
reporting main line of ments
business
54
26
126
1
4
9
42
5
9
58
52
164
1
49
284
4 40
•486
4
21
17
1
9
463
844
50
211
35
192
4
1
8
1
1
1
2
2
2
17
15
1
1
1
1
1
1
1 In addition to groceries, 3 societies handle coal, 22 dry goods, 12 shoes, 1 rags, 6 produce, 21 one or more
items of farm supplies (such as feed, seed, fertilizer, etc.), 12 hardware, 5 gasoline and oil, 2 machinery, 1
building materials, 2 crockery, 1 medicine, 1 clothing, 1 paint, 1 delicatessen goods, 1 notions, and 1 men’s
furnishings.
2 In addition to groceries and meat, 4 societies handle 1 or more items of farm supplies (such as feed,
seed, fertilizer, etc.), 4 dairy products, 1 paints, 5 hardware, 3 fuel, 1 men’s furnishings, 4 dry goods, 1 notions,
5 bakery products, 2 machinery and/or implements, 1 building materials, 2 gasoline and oil, and 1 beverages.
* In addition to general merchandise, 1 society handles paint, 19 handle 1 or more items of farm supplies
(such as feed, seed, fertilizer, etc.), 11 machinery and/or implements, 12 hardware, 4 dry goods, 6 coal, 11
gasoline and oil, 1 men’s furnishings, 2 shoes, 1 bakery goods, 6 produce, 4 forest products, 2 building
materials, 3 clothing, 1 furniture, 1 explosives, and 1 society does tracking.
4 In addition to students’ supplies, 1 society handles men’s furnishings and clothing, and 1 furniture.
* Stores operated; in addition, 18 societies handle coal, 12 gasoline and oil, 3 lumber and/or other building
materials, 3 farm machinery and/or implements, 1 shoes, 1 paint, and 5 hardware.
* Includes both bulk and retail stations, but does not include 25 truck routes. 1 society also handles
merchandise, 2 wool, 4 tires, and 1 society operates a garage.
2 This society also manufactures butter and ice cream.
4 Does not include the bakery societies whose main line of business is the manufacture of bakery products.
®Does not include the creamery society in which the manufacture of these products is one of the main
lines of business.
14
COOPERATIVE MOVEMENT IN 19 3 3
Membership
In
consumers’ cooperative movement the aim is to reach as
many persons as possible, open membership being one of the funda
mental tenets of consumers’ cooperation. In the cooperative society
the more members the more business, the greater the savings effected,
and the greater the returns to the purchasers. For these reasons
limitations on membership are very uncommon. There are many
societies whose membership is mainly of one nationality, but this is
almost always due to the natural tendency of persons to associate
with those from their own country of origin, not to a definite limita
tion on membership.
Of the societies which made returns in the present study only 39
had any membership restrictions. Of these the farmers’ organizations
were most numerous; 6 of these societies restricted their membership
to “producers”, 8 to farmers, and 7 to members of the Farmers’
Union. The only other restrictions on the occupational basis were
those of 4 students’ supply societies whose membership is limited to
the students and faculty of the university, and 1 society ‘which
accepts into membership only railroad men.
Numerical restrictions were reported by 2 societies, one of which
limits its membership to 32 members and the other to 200 members.
Three others are accepting no new members.
Nationality or race restrictions were reported by 4 societies, 2 ac
cepting whites only, 1 Finns only, and 1 only Italian-speaking persons
of good character.
To qualify for membership in 2 societies the applicant must reside
in the locality or trading area, and one of these also requires that the
member must give the cooperative business his patronage.
One society reports that it regards persons with “extreme left
wing” views as not “desirable” for membership purposes, but does
not say definitely that admission is refused to such persons. Another
organization, which is the joint enterprise of several local cooperative
store societies, accepts into membership only “genuine cooperative
organizations.”
At the end of 1933 the 579 consumers’ societies which furnished
reports had a combined membership of 225,441, an average of 389
persons per society. More than 76,000 persons were members of
store societies and about 127,000 were members of gasoline and oil
associations. There is probably some duplication in these figures,
as one person may be a member of several different societies.
the
15
CONSUMERS’ ORGANIZATIONS
Table 4.—TOTAL ANt> AVERAGE M EM BERSHIP OF CONSUMERS’ COOPERATIVE
SOCIETIES, END OF 1933
Type of society
Number of
societies
reporting
Retail store societies dealing in—
Groceries...........................................................-................
Groceries and meat.........................................................
General merchandise.......................................................
Fuel...................................... ..............................................
Students’ supplies............................-..............................
Total................................................................................
Distributive departments of marketing associations........
Gasoline and oil associations.................................................
Bakeries-............. ............................-..................................—
Restaurants and boarding houses........................................
Water-supply societies...........................................................
Funeral associations................................................................
Other societies— ....................................................................
Grand total.....................................................................
45
25
112
1
4
187
33
336
4
7
2
7
13
579
Membership
Average per
society
Total
8,857
12,671
23,532
100
31,000
76,160
6,590
127,243
2,618
4,752
368
3,321
i 4,389
225,441
197
507
210
100
7,750
407
200
379
655
679
184
474
11,463
389
* Not including 1 society whose members are 14 retail societies.
That the largest proportion of the societies have a small member
ship is shown by table 5. Over two-fifths of the societies reporting
had fewer than 200 members, and over 80 percent had fewer than 500
at the end of 1933. Only 38 (6.6 percent) were what in Europe would
be considered fair-sized societies, i.e., with 1,000 members or more.
Over half of these were oil associations.
Among the gasoline and oil associations the largest in point of
membership were the following:
Members
McLean County Service Co., Bloomington, 111__________2, 720
Montgomery County Farm Bureau Oil Association, Inc.,
Crawfordsville, Ind________________________________2, 000
Consumers Oil Cooperative, Inc., Greeley, Colo_________1, 745
Cooperators’ Union Oil Co. of Boise Valley, Caldwell, Idaho. 1, 688
Knox County Oil Co., Galesburg, 111___________________ 1, 597
Consumers Oil Co., Maryville, Mo____________________ 1, 500
Among the other associations the largest organizations (omitting
the students’ societies) were the following:
Members
Consumers’ Cooperative Services, New York, N. Y______ 3, 959
Franklin Cooperative Creamery, Minneapolis, Minn_____ 3, 950
Cooperative Trading Association, Brooklyn, N.Y________2, 800
Cooperative Trading Co., Waukegan, 111________________2, 096
Cloquet Cooperative Society, Cloquet, Minn____________ 1, 725
Newmanstown Cooperative Association, Newmanstown, Pa_ 1, 589
Tamarack Cooperative Association, Calumet, Mich--------- 1, 516
Rockingham Cooperative Farm Bureau, Harrisonburg, Va__ 1, 400
Workingmen’s Cooperative Co., Cleveland, Ohio_________1, 150
Minnesota Valley Burial Association, New Ulm, Minn-----1, 030
Cooperative Bakery of Brownsville & East New York,
Brooklyn, N.Y------------------------------------------------------ 1, 000
16
T
able
COOPERATIVE MOVEMENT IN 19 3 3
5.—DISTRIBUTION OF CONSUMERS* COOPERATIVE SOCIETIES ACCORDING
TO M EMBERSHIP AT END OF 1933
Number of societies having classified number of
members
Type of society
50 100 200 300 500 750 1,000 Total
Un and
and and and and and and
der under under
under under under
50 100 200 under
300 500 750 1,000 over
Retail store societies dealing in—
Groceries____________________________
Groceries and meat___________________
General merchandise__________________
Fuel________________________________
Students’ supplies____________________
Total
.
Distributive departments of marketing asso
ciations________________________________
Gaanlina and nil assnniatinns
Bakeries_____ __ ________________________
Restaurants and boarding houses__________
W ater-supply societies____________________
Funeral associations______________________
Other societies 2_ _ ______________________
Grand total________________________
4
30
9
7
35
7
4
19
6
1
8
3
3
2
4
3
4
21
46
52
30
15
8
4
11
3
7
35
10
73
6
8
71
5
72
32
2
2
1
1
1
3
2
98
44
7
2
12
12
1
1
1
35
2
1
1
1
136
109
45
25
112
1
4
187
33
336
4
7
2
1
7
1
*3
38 4 579
1
22
1
1
1
91
2
23
1
1
1
28
1 Not including 7 societies owned by 41 retail societies.
3 Includes a creamery, a laundry, a publishing association; and a trucking association.
* Not including 1 society owned by 14 retail societies.
4 Not including 8 societies owned by 55 retail societies.
The membership of the principal groups of societies is shown in
table 6 by States and by geographic divisions. Over 70 percent of
the membership is in the North Central States.
T
able
6
.—M EM BERSHIP OF CONSUMERS’ COOPERATIVE SOCIETIES AT END OF 1933.
BY STATES AND GEOGRAPHIC DIVISIONS
Distributive Gasoline and
associa
Store socie departments
of marketing oil tions
ties
associations
State and geographic division
Total
Num
Num
Num
Num
Num
ber Mem ber Mem ber Mem ber Mem ber Mem
re bers re bers re bers re bers re bers
port
port
port
port
port
ing
ing
ing
ing
ing
1
238
Alaska ____________________
1
150
Arkansas
________
2
12,000
California__________________
1
1
8
33
500
Colorado___________________
1
Connecticut________ _______
180
I
2
237
Idaho _____________________
2
218 36
Illinois ___________________ 10 3,976
11
2
Indiana___________________
240
2
595 38
376
Iowa_______________________ 3
26
8 1, 269
Kansas. ___________ ____ __ 14 2,067
1
1
Kentucky__________________
200
6
908
Maine .. _______________
Massachusetts _____________ 11 13, 723
Michigan _________________ 16 6,368
4 576
Minnesota__________ _______ 39 8, 543
i 51
Missouri___________________ 2
4 478
3
300
1
22
Montana___________________
60
Nebraska__________________
8
730
4 578 53
1
New Hampshire____________
56
New Jersey................................. 3 1,399
1 Not including 4 societies owned by 24 retail stores.
* Not including 1 society owned by 14 retail stores.
* Not including 5 societies owned by 38 retail stores.
Other socie
ties
4,005
1
20
1
50
1,563
1,688
29,048
5, 337
15, 504
4,037
500
t 18,967
2,293
2,902
16, 665
3
3 1, 618
1
5
25 2 5, 738
1
65
1
1
2
10
2
3
48
14
46
48
2
6
14
21
3 95
9
23
66
1
3
238
150
4,538
200
1,925
33,242
5, 627
18,038
7,373
700
908
15,341
6,949
3 33,248
3,071
2,962
18,038
56
1.399
12,000
17
CONSUMERS’ ORGANIZATIONS
T
able
6
—M EMBERSHIP OF CONSUMERS’ COOPERATIVE SOCIETIES AT END OF 1933,
BY STATES AND GEOGRAPHIC DIVISIONS—Continued
Distributive
and
Store socie departments Gasoline
associa Othertiessocie
ties
of marketing oil tions
associations
State and geographic division
Total
Num
Num
Num
Num
Num
ber Mem ber Mem ber Mem-' ber Mem ber Mem
re bers re bers re bers re bers re bers
port
port
port
port
port
ing
ing
ing
ing
ing
New Mexico________________
1
New York_________________
1
North Carolina_____________
4
North Dakota______________
__________________
8
Ohio
Oklahoma__________________
Oregon_____________________ 1
8
Pennsylvania _____________
5
South Dakota______________
2
Tennessee_______________ Texas______________________ 1
2
Virginia ________ ______
Washington..______ ________ 13
15
Wisconsin__________________
Wyoming ________ ________ 1
Total................................. 187
2,800
75
359
10,139
145
2,086
703
557
54
1,466
2,418
3, 382
192
76,160
2
1
2
230
955
787
2
359
1
2
19
45
33 6,590
6
3
13
17
1
4
23
2
4
336
478
5,264
816
370
5,408
5,544
500
4 7, 572
345
4 127,243
2
4,959
1
220
1
350
148
712
2
3
1
23
9
6
5
9
21
2
20
2
15
43
3
3 23 * 15,448 6 579
1
3
4
478
7, 759
75
5, 623
10,184
816
735
2,316
7,416
557
6,385
1,466
3,066
412,025
537
4 225,441
Geographic division 7
New England______________ 19
Middle Atlantic____________ 12
East North Central_________ 51
75
West North Central........... .
3
South Atlantic_____ ______
3
East South Central. _______
2
West South Central . ___
5
Mountain_________________
Pacific ____________________ 16
Total_____ _____ ______ 186
1
Alaska_____________________
14,867
6,285
24,105
13,078
1,541
757
204
522
14, 563
75,922
238
1
230
9 1,198
20 3,875
70 41, 957
203 68,138
1
500
2
787 23 6,360
1
500 35 9,418
4
870
33 6,590 336 127, 243
4 1,638
4,959
2
767
5
7,716
10
23 16,505
15 11,474
135 68,027
308 92,807
3 1, 541
4 1, 257
27 7,351
41 10,440
368 22 15,801
2
23 15,448 578 225, 203
1
238
* Not including 3 societies owned by 17 retail stores.
* Not including 7 societies owned by 41 retail stores.
* Not including 8 societies owned by 55 retail stores.
7 In all cases in this report the census classification as to geographical districts has been used. This
classification is as follows: New England division includes Maine, New Hampshire, Vermont, Massachu
setts, Rhode Island, and Connecticut. Middle Atlantic division includes New York, New Jersey, and
Pennsylvania. East North Central division includes Ohio, Indiana, Illinois, Michigan, and Wisconsin.
West North Central division includes Minnesota, Iowa, Missouri, North Dakota, South Dakota, Nebraska,
and Kansas. South Atlantic division includes Delaware, Maryland, District of Columbia, Virginia, West
Virginia, North Carolina, South Carolina, Georgia, and Florida. East South Central division includes
Kentucky, Tennessee, Alabama, and Mississippi. West South Central division includes Arkansas,
Louisiana, Oklahoma, and Texas. Mountain division includes Montana, Idaho, Wyoming, Colorado,
New Mexico, Arizona, Utah, and Nevada. Pacific division includes Washington, Oregon, and California.
Age of Societies
T he great m ajority of the 516 societies w hich reported the year of
establishm ent were form ed since the war, 82.7 percent being in this
category. T he gasoline and oil associations have been of especially
recent growth, about 85 percent having been started since 1926, and
considerably over one-third since the depression began. The store
societies are considerably older, about 30 percent having been
form ed before the war and more than half in the period 1916-20.
The oldest societies reporting in the present study are the Harvard
Cooperative Society formed in 1882, and the Associated Students of
18
COOPERATIVE MOVEMENT IN 19 3 3
the University of California formed in 1884. Other societies of long
standing are the following:
Year of
formation
Tamarack Cooperative Association, Calumet, Mich______
Washington ville Cooperative Society, Washington ville,
Ohio____________________________________________
Nelson and Albin Cooperative Mercantile Association, St.
James, Minn_____________________________________
Lily Creamery Co., Lake Crystal, Minn________________
Germania Fruit Growers’ Union and Cooperative Society,
Cologne, N. J_____________________________________
Union Mercantile Co., Isanti, Minn____________________
1890
1891
1894
1895
1896
1897
Table 7 shows the distribution of the societies according to the
period in which established.
T able 7.—DISTRIBUTION OF CONSUMERS' COOPERATIVE SOCIETIES ACCORDING
TO PERIOD IN WHICH ESTABLISHED
Retail
store
socie
ties
Year in which established
1881-85..............................................................................
1886-90.................... .......... .........................-...................
1891-95............. ............................. ...............-................
1896-1900 ................................. .......................................
1901-05....................................-....................................
1906-10.................. ................... ........ .............................
1911-15________________________________ _____ _
1916-20.................... ................. .................... -................
1921-25____________________________-...................
1926-29............................................................................
1930-33.................................. — ................... ..........— .
Total—................................. ............................. .
Distribu
tive de
part
ments of
market
ing asso
ciations
Gasoline
and oil
associa
tions
To tal
Other
types
of so
cieties Num
ber Percent
2
1
4
3
5
12
43
120
24
7
7
228
2
1
1
2
9
15
6
1
1
35
1
1
4
4
23
110
83
226
1
12
4
3
7
27
4
3
7
15
57
151
57
121
98
516
0.4
.2
.8
.6
1.4
2.9
29.3
11.0
23.4
19.0
11.0
100.0
Table 8 shows the distribution of the societies by age groups.
.—DISTRIBUTION OF CONSUMERS’ COOPERATIVE SOCIETIES ACCORDING
TO AGE GROUPS
Number of societies of classified age
5 10 15 20 25 30 40 50
Under and and and and and and and years
Type of society
Total
5 under under under under under under under and
years 10 15 20 25 30 40 50 over
years years years years years years years
7
3
9 78 83 28 10
2 228
Retail store societies.................................... 8
Distributive departments of marketing
12
13 5
3 ..........
35
1
1
associations________________________
5 2
1 1
226
Gasoline and oil associations..................... 106 100 11
1
3 ............................... .
Bakeries____________________________
4
R e s ta u r a n ts an d h o a rd in g houses
....
1
2
1 ............. .
4
8
W a te r - s u p p ly soeiet.ies
1 ................. .
1
2
2
9
Funeral associations....................................
7
1
3
4
Other societies L ................................ ........
110
107 36
Total.
123
2 516
i Includes a creamery, a laundry, a publishing association, and a trucking association.
T
able
8
Resources
T
resources of nearly $20,000,000 were reported by 494 socie
ties. These funds are built up by members' subscriptions for the
capital stock of the society and by appropriations from the net earnotal
19
CONSTJMERS ’ ORGANIZATIONS
ings of the society from year to year. One of the purposes for which
appropriations are made is the reserve fund designed to protect
the society against unexpected losses. The reserves thus built up by
the 390 societies reporting aggregated nearly 4 million dollars, or an
average of $9,956 per society. A reserve fund larger than the amount
of share capital was reported by 116 societies; 4 societies had
reserves of more than $100,000 each.
Share capital amounting to nearly 7 million dollars was reported
by 556 societies. This was an average of $12,352 per society and $37
per member.
T able 9 —SHARE CAPITAL, RESERVES, AND TOTAL RESOURCES AT END OF 1933, BY
TYPE OF SOCIETY
Share capital
Reserves
Num
Num
Aver ber of
ber of
Type of society
age socie
socie Amount Average
per
per ties Amount
ties
society mem report
report
ber
i ing
ing
Retail store societies____ _________ 214 $2,774, 664 $12,966 $43 149 $1,865,751
Distributive departments of market
ing associations.................................. 32 635,826 19,870 98 19 240,728
Gasoline and oil associations.............. 285 2,395, 677 8,406 23 208 1,378, 571
Bakeries.................................................
4
3
19, 701
33,845 8,461 13
Restaurants and boarding houses__
4 214,262
8
92,233 11,529 19
Water-supply societies......................... 1
14,800 14,800 100 (2)
(2)7,451
Funeral associations............................. 8
4
29,001 3,625 28
Other societies3............. ...................... 4 891,905 225,976
3 156, 341
Total............................................. 4 556 6,867,951 12,352 37 * 390 *3,882,805
Total resources
Num
ber of
socie Amount
ties
report
ing
214 $10,881,422
29 1,224,170
227 5,770,907
4
228,825
324,350
6
2
19,631
8
58,334
4 1,399,930
494 19,907,569
i Based on societies reporting both membership and capital.
* 1 society had a deficit of $3,250.
* Includes a creamery, a laundry, publishing association, and a trucking association.
<Not including 2 nonstock associations.
* Not including 7 societies which reported deficits amounting to $42,630 and 2 societies which had deficits
but did not report amount.
a
Table 10 classifies the societies according to the amount of their
assets. More than half of the societies had resources of less than
$25,000, while 85 percent had resources of less than $50,000. On
the other hand, 2 societies had assets of $1,000,000 or more.
T able 10.—DISTRIBUTION OF CONSUMERS’ COOPERATIVE SOCIETIES BY AMOUNT
OF ASSETS AT END OF 1933
Number of societies with classified amount of assets, 1933
Type of society
$25,000 $50,000 $100,000 $200,000 $300,000 $500,000
Under and and and and and
and
$25,000 under under under under under under
$50,000 $ 100,000 $200,000 $300,000 $500,000 $ 1, 000,000
$ 1, 000,000
and
over
Retail store societies............._ 111
71
20
9
1
1
1
Distributive departments of
7
2 ______
marketing associations____ 12
8
.......................
Gasoline and oil associations. 142
59
21
5 ______
......................
1
3 ........... ...............
Bakeries............................... .
.....................
Restaurants and boarding
houses.........................
___ ___
Water-supply societies.
................
..............
Funeral associations...
1
Other societies 1______
Total....................
282 139
1
2
Includes a creamery, a laundry, a publishing association, and a trucking association.
Total
214
29
227
4
6
2
8
4
494
20
COOPERATIVE MOVEMENT 1ST 193 3
Business Done by Cooperative Societies
business done by the consumers’ societies in 1933 amounted to
somewhat over $40,000,000, nearly three-fourths of which was done by
societies in the East and West North Central States. Here the Min
nesota societies lead, that State accounting for about one-fifth of the
total sales. Table 11 shows the amount of business done by the dif
ferent types of societies in 1933, by State and geographic division.
T he
T able 1 1 —AMOUNT OF BUSINESS OF CONSUMERS’ COOPERATIVE SOCIETIES IN 1933,
BY STATES AND GEOGRAPHIC DIVISIONS
Distributive
Retail store so departments of Gasoline and oil Other societies
Total
marketing asso associations
cieties
State and
ciations
geographic
division
Num Amount Num Amount Num Amount Num Amount Num Amount
ber
ber
ber
ber
ber
Alaska _______
Arkansas_______
California______
Colorado_______
Idaho __ ______
Illinois________ _
Indiana________
Iowa......................
Kansas_________
Kentucky______
Maine_________
M assachusetts__
Michigan_______
Minnesota______
Missouri_______
M ontana_____
Nebraska______
New Hampshire .
New Jersey_____
New Mexico____
New York_____
North Carolina. .
North Dakota__
Ohio___________
Oklahoma______
OfAgnn
Pennsylvania___
Rhode Island___
South Dakota---TprmfiSfifie _ _ . _
Texas__________
Virginia________
Washington____
West Virginia___
Wisconsin______
Wyoming______
Total..........
1
1
3
1
1
3
10
2
4
14
1
6
12
26
65
5
1
8
1
3
1
1
4
8
8
1
1
5
2
2
16
1
20
1
229
$13,109
’16', 428
362,380
28' 538
86' 411
188,880
882^ 742
77, 776
106; 476
612,112
36,926
184; 688
1,818,505
1, 776,335
2,818,974
246,266
32, 516
291,273
33,581
251,670
181,026
18,600
228, 587
715,386
64,000
297,759
44,424
206,138
23,593
448,900
1,185,183
52,189
957,001
83,746
14,372,118
1
1
1
$51,133
241,455
3 439, 746
7 574,473
2
2
4
4
1
1
1
2
143, 575
131,901
205,732
19,000
4,000
55,455
296,731
3 162,233
31 2,325,434
8
1
42
14
38
27
1
$503, 364
92,242
4,058,872
1, 723, 583
2,086,963
793, 701
28, 542
1
19,751
74 3,712,212
3 107, 575
21
685,119
59 2, 550, 273
20 1,155, 291
2
168,000
5
3
14
150,001
99,266
754,587
17
882,066
1
91,934
31 1,304,606
2
49,907
384 21,017,855
3
1
1
1
5
$8,005
30, 675
11,000
28,744
3 162,346
5 1,807,900
1
1,750
2
583,315
1
3,275
1
2,824
3,250
3 72,817
25 2, 715,901
1
10
2
4
55
17
50
48
2
6
15
29
134
12
22
72
3
2
3
1
4
9
5
5
9
21
1
21
2
19
2
18
1
57
3
669
$13,109
16,428
362,380
583,035
94,416
281,122
5,213,744
1,812,359
2,661,929
1,980, 285
65,46S
184,688
1,980,851
1,939,661
8,339,086
485, 742
717,635
3,049,028
1,188,872
251,670
168,000
764,341
18,600
228,587
734,386
150,001
166, 541
301,759
44,424
1,019,004
23, 593
1,178, 797
448,900
1,280,367
52,189
2,496,657
133,653
40,431,308
Geographic divi
sion 1
4 170,351 45 3,493, 251
20 1,155,291
New England___ 21 2,167,609
1
2
583,315 15 1,317,770
Middle Atlantic- 12 730,455
4,000
East North Cen
5 114,492 167 12,196,807
566,263 88 7,106,812
tral__________ 66 4,409,240
West North Cen
tral........ ........... 95 4,509,826 19 1,407,307 215 10,005, 311 12 1,841,218 341 17,763,662
4
South Atlantic__ 4 519, 689
519, 689
East South Cen
1
3
4
28, 542
89,061
tral ______
60, 519
West South Cen
1
25 1,345, 226
2
296,731 22 1,032,067
16,428
tral __________
1
41 1,883,445
Mountain______
6
333,680
51,133 34 1,498, 632
4 191,200
2
6, 525
26 1,809, 288
Pacific_________ 20 1, 611,563
Total.......... 228 14,359, 009 31 2, 325,434 384 21, 017,855 25 2, 715, 901 668 40,418,199
1
13,109
13,109
Alaska
_____ 1
1 For States included in the respective geographic divisions, see footnote 7 to table 6.
8
That the business done by the individual cooperative societies is
generally on a moderate scale is shown in table 12. Thus 400 of the
21
CONSUMERS’ ORGANIZATIONS
669 societies had sales of less than $50,000 during 1933. Five socie
ties, however, did a business of $500,000 or more. These societies
were the following:
Franklin Cooperative Creamery, Minneapolis, Minn__ $1, 773, 582
Harvard Cooperative Society, Cambridge, Mass____
947, 744
Montgomery County Farm Bureau Oil Association,
Inc., Crawfordsville, Ind______________________
872, 776
Cloquet Cooperative Society, Cloquet, Minn_______
566, 006
Cooperative Trading Co., Waukegan, 111___________ 534, 478
T able 12.—DISTRIBUTION OF CONSUMERS' COOPERATIVE SOCIETIES ACCORDING
TO AMOUNT OF BUSINESS DONE IN 1933
Number of societies with classified amount of business, 1933
$25,000 $50,000 $100,000 $200,000 $300,000 $500,000 Total
Type of society
Under and
and
and
and
and
and
$25,000 under under under under under over
$50,000 $100,000 $200,000 $300,000 $500,000
Retail store societies dealing in—
6
5
24
19
Groceries___________________
8
2
5
Groceries and meat__________
6
2
General merchandise________
45
12
2
2
47
37
1
Fuel_____________ _________
Students’ supplies .............
2
1
Total.......... .............................
73
70
51
25
5
2
Distributive departments of mar
2
keting associations____________
6
7
6
10
104
5
Gasoline and oil associations_____
35
1
121
117
1
1
Bakeries_______________________
2
4
Restaurants and boarding houses..
i
1
2
Water-supply societies__________
9
Funeral associations_____________
1
2
Other societies 1________________
4
Grand total_______________ 201
199
66
181
13
1 Includes a creamery, a laundry, a publishing association, and a trucking association.
1
54
25
145
1
4
229
31
384
1
5
9
4
669
2
1
3
4
6
2
Comparative sales figures for the 4 years 1930 to 1933 are given in
table 13.
T able 13.—AMOUNT OF BUSINESS DONE BY CONSUMERS’ COOPERATIVE SOCIETIES,
1930 TO 1933
1930
1932
1933
1931
Num
Num
Num
Num
ber of
ber of
ber of
ber of
Type of society
socie
socie
socie
socie
ties Amount ties Amount ties Amount ties Amount
re
re
re
re
port
port
port
port
ing
ing
ing
ing
Retail store societies dealing
in—
Groceries....... ...................... 43 $2,993,308 45 $2,462,322 50 $2,025,346 54 $2,006,765
Groceries and meat______ 21 4, 652,997 22 3,970,964 25 3,409,625 25 3,289, 256
General merchandise____ 114 10,143,913 114 7,641,836 131 7,202, 203 145 7,662, 768
Fuel_______ ____ _______
1
36, 779
1
34,920
1
29,056
1
35,290
Students’ supplies.............. 4 1,990,074
4 1,965, 715
4 1, 747,343
4 1, 378,039
Total.................................. 183 19,817,071 186 16,075,757 211 14,413, 573 229 14,372,118
Distributive departments of
marketing associations_____ 21 4,652,482 22 4,064, 540 26 2,178,477 31 2,325,434
Gasoline and oil associations. _ 164 12,999, 550 229 15,281,571 314 17,574, 237 384 21,017,855
Bakeries________ ________
384,418
4
4
408,366
457,373
461, 748
4
4
Restaurants and boarding
houses_____________ ______
707,472
641,824
489,836
398,942
5
6
6
6
7,332
6,525
2
Water-supply societies_______ 2
7, 599
2
2
", 386
32,633
Funeral associations_________
1
2,200
2
56,276
17,940
5
9
Other societies 1________ ____
3 3,260, 533
3 2,075,596
3 2, 732,064
4 1,845, 792
Grand total___________ 383 41,904,067 454 39,283,043 571 37,156,102 669 40,431,308
109,410
Average per society_________
86, 527
65,072
60,435
1 Includes a creamery, a laundry, a publishing association, and a trucking association.
22
COOPERATIVE MOVEMENT IN 1 9 3.3
Operating Expenses
D
reports as to operating expenses for 1933 were furnished
by 173 societies—83 store societies, 89 gasoline and oil associations,
and a bakery. Table 14 shows the expense (in percent of net sales)
incurred for specified items.
e t a il e d
T able 14.—OPERATING EXPENSES OF CONSUMERS’ COOPERATIVE SOCIETIES IN 1933
Percent of sales spent for specified item by—
Retail stores handling—
Gaso
line
and Bak
Gen
Gro Stu Total,
oil
eral Gro ceries
stores
eries
dents’
asso
mer ceries and sup (83)
(1)
cia
chan (19) meat plies
tions
dise
(89)
GO)
(2)
(52)
Item
Sales expense:
Wages_____
AdvertisingWrappings. .
TotalMiscellaneous delivery expense (except wages)
Rent___________ ________________________
Light, heat, power, and water.......................... .
Insurance and taxes_______________________
Interest on borrowed money_______ ______
Office supplies and postage................... .............
Telephone and telegraph— ............................
Repairs................................................................... .
Depreciation_______________ ______________
Bad debts........................................... ................. .
Auditing.................................................................
Legal service------ ---------- --------------------------Freight, drayage, and express........................... .
Miscellaneous................................................ ......
Grand total-
7.54
.30
.21
8.05
.57
.48
.57
1.22
.31
.12
.10
.20
1.17
.37
.09
.02
.98
1.12
15.36
21.47
.37
.14
21.98
.76
1.18
1.64
4.00
1.08
.54
.23
.23
2.01
.31
.32
2.37
1.87
38.52
11.12
.48
.36
11.96
.98
.57
.93
1.25
.39
.12
.18
.35
1.54
.53
.09
.04
.97
1.36
21.25
19.04
1.45
20.49
.04
.45
.24
1.09
.71
.20
.05
2.09
.13
.21
2.09
.96
28.75
9.15
.38
.23
9.76
.65
.51
.67
1.27
.34
.15
.13
.23
1.28
.38
. 10
.02
1.02
1.15
17.66
9.87
.19
10.06
.98
.26
.24
.91
. 13
.28
.13
.15
1.47
.25
1. 72
16.60
42.04
.17
.54
42.76
2.23
3.10
2.64
.65
.07
.15
.73
2.16
.07
. 12
. 35
1.08
56.15
N et Savings or “Profits”
L
aggregating $136,306 were reported by 85 societies, and 10
other societies reported that they had sustained a loss but did not
give the amount. The trading operations of 449 societies, on the
other hand, resulted in combined savings of $2,072,302. For the
534 societies which reported on this point, therefore, there was a net
saving of $1,935,996, which represented 5.5 percent figured on sales
and 23.5 percent figured on share capital. As consumers’ cooperative
societies almost universally sell their goods at the current prices,7
o sses
7 Of 435 societies which reported on this point, only 21 did not operate on the current-price basis.
Of these, 6 made a practice of selling their goods at prices slightly lower than the market price, 1 sold at 5
percent below the current prices, and 1 allowed a discount of 10 percent on all cash purchases; 1 operated on
the “cost-plus” basis, and 1 set its prices at cost plus 2 percent.
23
CONSUMERS’ ORGANIZATIONS
the net saving is affected by the prevailing margin of profit in the line
of business carried on, as well as by the efficiency of the individual
society. It is evident that the margin is considerable in certain lines,
notably in the students’ supply stores and in the gasoline and oil
associations. Of the 293 oil associations which reported, only 13 had
a loss, while the net profit of the others aggregated more than 1%million
dollars.
T
a ble
15.—NET LOSS OR SAVINGS ON 1933 BUSINESS OF CONSUMERS’ COOPERATIVE
SOCIETIES
Loss
Type of society
Retail store societies dealing in—
Groceries_____ ______________
Groceries and meat.............. .......
General merchandise................
Students’ supplies.......................
Total....................................... .
Distributive departments of mar
keting associations_____________
Gasoline and oil associations______
Bakeries_________ ______________
Restaurants and boarding houses
Water-supply societies......................
Funeral associations_____________
Other societies4-----------------------Grand total..............................
Savings
Rate of
total net
Total net savings gain
based
on—
Num
Num
Num
ber of
ber of
ber of
Share
socie Amount socie Amount socie Amount Sales1 capi
ties
ties
ties
ta l3
having
having
having
$11,386
27,423
23,130
11,156
73,095
31 $33,182
14 70, 587
93 135,446
2 58, 047
140 297,262
8 3,459
13 23,822
2 8, 538
1
146
2
603
3 26,643
•85 «136,306
19 40,711
280 1,722, 799
2
571
2
7,307
5
2,496
1
1,156
449 2,072, 302
11
9
34
2
56
42
23
127
4
196
$21,796
43,164
112,316
46,891
224,167
Pet.
Pet.
1.2 5.0
1.3 8.5
1.7 6.6
3.4 109.5
1.7 8.9
27
37,252 1.5 4.2
293 1,698, 977 9.8 59.4
4
8 7,967 41.9 4 23. 5
3
7,161 1.9 8.7
2
8 603 4 9.2 * . 1
5
2,496 7.1 15. 3
4 8 25,487 41.4 4 2.9
•534 • 1,935, 996 5.5 23.5
1 Calculated on basis of societies reporting both sales and net loss or gain.
3 Calculated on basis of societies reporting both share capital and net loss or gain.
8 Loss.
4 Percent of loss.
«Includes a creamery, a laundry, a publishing association, and a trucking association.
•Not including 10 societies which reported a loss but did not state amount.
Table 16 shows for 1933 the combined gains or losses of the societies,
by States and by principal society groups.
24
T
able
COOPERATIVE MOVEMENT IN 19 3 3
1 6.—N E T EAR N IN G S OF CONSUM ER S' COOPERATIVE SOCIETIES IN 1933, BY
STATES
Retail store
societies
State
Alaska________________
Arkansas______________
California______________
Colorado _ ___________
Connecticut____________
Idaho_________________
Illinois________________
Indiana_______________
Iowa___ ____________
Kansas________________
Kentucky_____________
Maine_________________
Massachusetts_________
Michigan______________
Minnesota_____________
Missouri_______________
Montana______________
Nebraska______________
New Hampshire________
New Jersey____________
New Mexico________ __
New York_____________
North Carolina_________
Nnrt.h Dakota .
Ohio.....................................
Oklahoma_____________
Oregon________________
Pennsylvania__________
South Dakota__________
Tennessee_____________
Texas_________________
Virginia_______________
Washington____________
West Virginia__________
Wisconsin_____________
Wyoming______________
Total___________ _
Distributive
departments Gasoline and
of marketing oil associations Other societies
associations
Total
Num
Num
Num
Num
Num
ber of
ber of
ber of
ber of
ber of
socie
socie
socie
socie
socie
ties Amount ties Amount ties Amount ties Amount ties Amount
re
re
re
re
re
port
port
port
port
port
ing
ing
ing
ing
ing
1
1
3
(2)1
32
9
2
3
12
1
33
3 11
24
49
5
1
37
1
3
1
1
3
6
1 $67
i 711
i 8,155
(2)
1 1, 072
« 2,325
14,122
5,736
1, 520
16,683
200
* 1,015
3 69,554
10,187
67,249
3, 212
141
* 458
1 261
560
1 9,719
306
3,306
8,115
3 6 * 16,301
2
i 376
2
» 765
(2)15 (2)
8, 540
1
237
19 14,657
1 1,785
« 196 *224,167
2 4,659
3 2,300
7 18,684
6 $9,997
1
8,136
34 500,820
12 89,941
31 145,961
22 32, 665
1 2,654
4
695
3 1,403
1
540
72 343,010
3
5,705
8 25,288
41 128,069
1 1 $465
1
2 5,858
1 1685
3
2,149
27 37, 252
14
4
1
12
5
498
131,309
7,301
637
164,742
15,208
1
6,119
22
78,233
2
4,798
293 1,698,977
i
1
2
1
$140
766
334
3 1 6,456
5 122,493
2
5,029
1
1
1
1
1
584
65
1 18
1903
18 124,400
1
1 $67
1
1 711
3
1 8,155
* 9, 532
*7
1 1,212
2
* 3 * 10,461
46 520,367
14
95,677
39 150,115
41
68,032
1
200
33
* 1,015
3 14 * 63,098
13,381
26
126 387, 766
12
9, 612
9
25,429
*51 * 129, 014
1
1 261
560
3
1
498
3
14,690
1
306
17 134,615
8,115
6
7,301
4
53
2
* 6 »16,301
17 170, 289
1 765
6
14,523
(2)
(2)17
14,641
1
237
45
94,136
3
6,583
*534 *1,935,996
2
1 Loss.
2 Society reported a loss but did not state amount.
* Not including 1 society which reported a loss but did not state amount.
* Loss; does not include 1 society which reported a loss but did not state amount.
* Not including 7 societies which reported a loss but did not state amount.
The net savings or “profits” made by the consumers’ cooperative
societies for their members in each of the 4 years 1930 to 1933 are
shown in table 17. During this period the societies reporting made
savings through their trading operations amounting to $7,419,999.
25
CONSUMERS’ ORGANIZATIONS
T
ablb
1 7 .—
NET SAVINGS OF CONSUMERS' COOPERATIVE SOCIETIES, 1930 TO 1933
1030
Type of society
Retail store societies dealing in—
Groceries....................................
Groceries and meat...................
General merchandise.................
Fuel........ ........ ...........................
Students’ supplies.....................
Total...........................—........ .
Distributive departments of mar
keting associations____________
Gasoline and oil associations_____
Bakeries__________ ____________
Restaurants and boarding houses. .
Water-supply societies__________
Funeral associations........................
Other societies 3_...............................
Grand total.............................
1931
1932
1933
Num
Num
Num
Num
ber
ber
ber
ber
of
of
of
of
socie Amount socie Amount socie Amount socie Amount
ties
ties
ties
ties
re
re
re
re
port
port
port
port
ing
ing
ing
ing
39
20
104
1
4
168
$52,153
160,378
230,373
9,110
197,670
649,684
36
21
97
1
4
159
$30,854 42
86, 524 22
132,662 104
264
155, 685 0)4
405,989 172
$1,981
13,203
20,012
0)
88,800
123,996
42
23
127
0)4
196
$21,796
43,164
112,316
0)
46,891
224,167
22
83,832 22
80,057 22
11,894 27
37,252
127 1,429,858 173 1,326,865 185 1,153,901 293 1,698,977
4
4
4 311, 562
1,900
4 3 7,967
11,178
26,531
33,100
3
3
16,877
7,161
3
3
2
2
1
1,027
909
256
2
3 603
2
1,919
3
2,438
1
3 125
5
2,496
3 120,125
3
49,025
3 3 35, 671
4 3 25,487
* 320 <2,328,679 *368 •1,893,195 •394 « 1,262,129 •534 « 1,935,996
11 society reported a loss but did not state amount.
* Loss.
3 Includes a creamery, a laundry, a publishing association, and a trucking association.
* Not including 3 societies which reported a loss but did not state amount.
3 Not including 12 societies which reported a loss but did not state amount.
«Not including 10 societies which reported a loss but did not state amount.
Division of Earnings
I
characteristic of the consumers' cooperative movement that
a moderate fixed rate of interest is paid on capital. The remainder
of the net earnings, after provision is made for reserve, educational
fund, etc., is returned to the purchasers in proportion to their business
with the society. The more money spent at the cooperative store,
therefore, the greater the amount of refund at the end of the year.
There are, however, some exceptions to the above statement. Some
societies pay no interest on share capital, and others, instead of
returning patronage dividends, use any earnings for social or general
welfare purposes.
Interest on share capital.—Interest on share capital, amounting to
$157,186, was paid in 1933 by the 203 societies reporting; 56 other
societies paid interest at varying rates but failed to report the amount
paid. The sum so paid during the 4-year period 1930 to 1933
amounted to $631,423. Table 18 shows by type of society the amount
paid as interest on share capital for each of the 4 years.
t is
26
T
a ble
COOPERATIVE MOVEMENT IN 193 3
18.—INTEREST PAID ON SHARE CAPITAL BY CONSUMERS’ COOPERATIVE
SOCIETIES, 1930 TO 1933
1930
Type of society
1931
1932
1933
Num
Num
Num
Num
ber of
ber of
ber of
ber of
socie Amount socie Amount socie Amount socie Amount
ties
ties
ties
ties
report
report
report
report
ing
ing
ing
ing
75
Retail store societies— ........................ 80 $81,404
Distributive departments of market
10
ing associations__________________ 13 20, 265
Gasoline and oil associations. ............. 82 59,048 108
1
Bakeries__________________________ 0)
(9
3 3,614
Restaurants and boarding houses___
3
1
1
1,
524
Other societies................. ......................
Total............................................... 3179 3 165,855 3 198
$69,628
53 $43,580
61 $46,381
14,051
8 9,965
11 13,698
78,078 115 80,879 127 91,906
1,679 (0
(0
3,812
3 4,017
4,016
3
1,404
1 1,289
1
1,185
3 168,652 *180 *139,730 3 203 3157,186
11 society paid 5 percent but did not report amount.
3 Not including 1 society which paid percent, 3 which paid 3 percent, 2 which paid 4 percent, 19 which
paid 5 percent, 20 which paid 6 percent, 4 which paid 7 percent, and 26 which paid 8 percent but did not
report amount.
3 Not including 1 society which paid 1H percent, 1 which paid 2 percent, 1 which paid 3 percent, 3 which
paid 4 percent, 10 which paid 5 percent, 13 which paid 6 percent, 3 which paid 7 percent, 31 which paid
8 percent, and 1 which paid 10 percent but did not report amount.
* Not including 2 societies which paid 1 percent, 1 which paid 3 percent, 5 which paid 4 percent, 6 which
paid 6 percent, 6 which paid 6 percent, 2 which paid 7 percent, 30 which paid 8 percent, and 1 which paid
10 percent but did not report amount.
3Not including 1 society which paid 1 percent, 4 which paid 3 percent, 3 which paid 4 percent, 7 which paid
6 percent, 11 which paid 6 percent, 4 which paid 7 percent, and 26 which paid 8 percent but did not report
amount.
Patronage refunds.—Table 19 shows the amount returned in pur
chase rebates in each of the 4 years 1930 to 1933. Nearly 4K million
dollars was thus returned, a most welcome addition to the incomes
of the members during these depression years. In addition, many
societies returned rebates but failed to state the amount so returned.
The gasoline and oil associations’ showing is particularly gratifying,
approximately 85 percent of the total rebates in 1933 having been
returned by them.
One general-store society points out that it has been able to return
a patronage dividend in every year but one since 1920, and another
states that it has never missed paying a patronage rebate since its
formation in 1920. A third has paid rebates on purchases every year
since it was started in 1921 and in addition has accumulated reserves
more than eight times the amount of its capital stock.
An eastern society reports that in spite of the depression it has made
progress every year and has been able to pay patronage dividends;
these have, during the 4 years 1930 to 1933, amounted to $27,891.
A Michigan society which pays its employees a bonus on wages at
the same rate as the patronage refund to members, has, since its
organization in 1913, returned in dividends, interest, and wage bonuses
the sum of $341,102.
A Kansas association has paid 8 percent interest on stock, and from
2 to 12 percent as purchase dividend, every year since its formation
in 1919.
27
CONSUMERS’ ORGANIZATIONS
One Massachusetts society which operates a grocery store has
arrangements with clothing, furniture, and shoe merchants in a
nearby town whereby its members are allowed a 10 percent dis
count on their purchases. Another, which has paid no dividends
since the depression began, reports that the savings have been placed
in a “surplus fund” to cover outstanding accounts. This was done
as a measure of protection. A record is being kept of each member’s
business with the society, however, so that when conditions improve
each patron will receive his pro-rata share.
The record of some of the oil associations is truly remarkable.
Thus, one association which started business with $4,000 in capital
in 1927 has, since that time, returned more than $25,000 in dividends.
Another has paid dividends amounting to $101,548, in 8 years’ opera
tion. Two others which have been in business 7 years each have paid
in rebates on purchases $134,236 and $162,450, respectively.
T
able
1 9 .—
PATRONAGE REFUNDS OF CONSUMERS’ COOPERATIVE SOCIETIES, 1930
TO 1933
1930
Type of society
1931
1932
Num
Num
Num
ber of
ber of
ber of
socie
socie
socie
ties Amount ties Amount ties Amount
re
re
re
port
port
port
ing
ing
ing
Retail store societies dealing in—
17 $30,428 13 $15,706 10
Groceries.....................................
73,356 10
Groceries and meat....... ................. 11 107,108 12
82, 522 26
General merchandise...................... 35 107,721 35
3 118,174
3 110, 910
3
Students’ supplies..........................
Total............................................. 66 363,431 63 282,494 49
Distributive departments of market
24, 557
6
56, 324
6
ing associations....... .......................... . 7
Gasoline and oil associations________ 97 773,912 124 775, 501 134
1
1
1
Restaurants and boarding houses___
7,669
6, 680
Grand total_________________ i 171 11,169,569 2194 21,120,999 3 190
$10,403
46. 546
39, 787
92, 235
188,971
1933
Num
ber of
socie
ties Amount
re
port
ing
12 $10,667
9 37, 327
35 62,140
2 59, 567
58 169, 701
14, 077
5
4,302
710, 664 201 1, 054, 590
4, 364
1,382
1
3918, 076 4 265 41,229,975
1 Not including 1 society which returned 2 percent, 1 which returned 6 percent, 1 which returned 9 per
cent and 1 which returned 10 percent but did Dot report amount, 1 society which allowed 2^ percent on
cash purchases, and 1 which allowed 10 percent,
2 Not including 2 societies which returned 2 percent, 1 which returned 5 percent, 1 which returned 5.3
percent, 1 which returned 8 percent, 1 which returned 9 percent, 1 which returned 10 percent, 1 which re
turned 14 percent and 1 which returned 17 percent but did not teport amount, 1 society which allowed 2H
percent on cash purchases, and 1 which allowed 10 percent.
3 Not including 1 society which returned 2 percent, 1 which returned 3 percent, 2 which returned 4 per
cent, 1 which returned 5 percent, 1 which returned 10 percent, 1 which returned 12 percent and 1 which
returned 15 percent but did not report amount, 1 society which allowed percent on cash purchases, and
1 which allowed 10 percent.
4 Not including 2 societies which returned 2 percent, 1 which returned 3 percent, 1 which returned 4 per
cent, 3 which returned 5 percent, 2 which returned 6 percent, 1 which returned 7 percent, 1 which returned
9 percent, 3 which returned 10 percent and 1 which returned 20 percent but did not report amount, 1
society which allowed 2H percent on cash purchases, and 1 which allowed 10 percent.
144224°— 35--- 3
28
COOPERATIVE MOVEMENT IN 193 3
The practice as regards purchase refunds to nonmembers varies
considerably. There were 301 societies which reported on this point.
Of these, 95 pay no rebates whatever to nonmember patrons; 2 of
these put into the reserve fund any earnings from business with them;
1 puts such earnings into an educational reserve fund, and another
society retains such earnings in the company treasury. Four socie
ties report that they do no business with nonmembers. Nonmembers
receive the same rate of dividend as the members in 179 societies,
but in 2 societies the dividend must be traded out and in 107 the
dividend is not paid in cash but is applied toward the purchase of a
share of stock in the patron’s name, so that when the share is paid
for he becomes a member of the organization. Twelve associations
pay dividends to nonmembers at half the members’ rate, while 2
societies pay 2 percent, 3 pay 2 percent on cash purchases, 1 pays 2
percent on accounts paid within 30 days and 1 on accounts paid with
in 90 days, 2 pay 3 percent, and 2 pay 5 percent.
Wages and Working Hours
E ach society was requested to report the number of employees,
the amount spent in wages in 1933, and the weekly working hours
of the employees.
Employment and pay roll.—In addition to 41 part-time workers,
456 societies reported the employment of 3,252 employees.
T
a ble
20.—EMPLOYMENT AND PAY ROLL OF CONSUMERS’ COOPERATIVE SOCIETIES
IN 1933
Employment
Type of society
Retail store societies dealing in—
Groceries------- --------- -------------------------------------- Groceries and meat-------- ---------------------------------General merchandise..............................------- --------Students’ supplies--------------------------------------------Total__________________ ____________________
Distributive departments of marketing associations. __
Gasoline and oil associations-----------------------------------Bakeries___________________________________ _____ _
Restaurants and boarding houses ...................................
Water-supply societies____ _ _____________________
Funeral a sso cia tio n s----------- ------------------------- ----Other societies 3----------------------------------------------------Grand total................................ ............._.................
Wages paid, 1933
Average
Number Number Number
annual
of
of full
of
wage
per
societies time societies Amount
em
report employ report paid
ing
ing
ees
ployee 1
177
50
370
26
118
661
3
106
197 1,314
32
139
202 1,117
4
116
6
133
2 (2)
13
9
420
4
456 * 3, 252
48 $165,250
24 366, 747
113 504,176
4 196,170
189 1,232,343
30 121, 760
173 1,047,088
4 161, 578
6 132, 693
2
(2)
14,185
8
4 714,326
416 3,423,973
i Based on societies reporting both employees and wages.
»4 part-time employees, who were paid $1,400 in wages.
* Includes a creamery, a laundry, a publishing association, and a trucking association.
«Not including 41 part-time employees.
$955
1,057
814
1, 52fi
962
922
1,110
1,393
998
1,182
1,701
1,129
29
CONSUMERS’ ORGANIZATIONS
A pay roll of $3,423,973 was reported by 416 societies, or an average
of $1,129 per worker during 1933. It is evident from table 20 that
the average annual wage varies considerably according to type of
society. The miscellaneous group has the highest average wage, due
to the high scale (average $1,753) of a creamery society in that group.
The students' societies come next, and the bakeries third.
One society reports that wages were cut in half in 1932 and 1933 in
the attempt to lower overhead expenses, but in spite of this action a
loss was incurred in both years.
One Michigan society pays to its employees a bonus on wages at
the same rate as the patronage refund to members. This is the only
cooperative association, of which the Bureau has knowledge, which
follows this practice.
Working hours.—The weekly hours worked by employees were
reported by 326 societies. As table 21 shows, the hours so reported
ranged in the various societies from 36 to 101.5 per week and averaged,
for all societies reporting, 54 hours. The lowest average hours were
those in the laundry and water-supply societies, but 4 of the 10 classes
of societies shown in the table had average weekly hours of 48 or under.
It is seen that the average in the store societies was somewhat above
the average for all societies.
T * b i .e
2 1 .—AVERAGE AND RANGE OF WORKING HOURS IN CONSUMERS’ COOPERA
TIVE SOCIETIES IN 1933
Type of society
Retail store societies dealing in—
Groceries_________________________________________ __
Groceries and meat_______ __________________________
General merchandise_________________________________
Fuel_______________________________________________
Students’ supplies_____________________________ __
Total._________________________ _________ ________
Distributive departments of marketing associations____ ____
Gasoline and oil associations______________________________
Bakeries_______________________________________________
Restaurants and boarding houses_________________________
Other societies l . . . . . . . . .
Grand total_______________________________________
Number of
societies
reporting
47
26
100
1
4
178
29
106
3
6
4
326
Weekly working hours
Range
44-86
42-66
43H-101H
48
40-44%
40-101H
40-79
36-86
48
41-56
40-48
3G-101M
Average
57. 2
52.8
57. 0
48. 0
43.2
56.1
54.0
51.2
48. 0
49. 5
43.3
54.0
1 Includes a creamery, a laundry, a water-supply society, and a publishing association.
The distribution of societies according to their weekly working
hours is shown in table 22. Although over two-fifths of the societies
had working hours of 48 or less in 1933, unduly long hours were
reported by a number of societies.8 As the table shows, 20 of the
societies (6.1 percent) worked their employees 12 hours or longer per
day, and 90 (27.6 percent) 10 hours or longer per day.
8 The code for retail trade, providing for working hours ranging (according to store hours) from 40 to 48
per week, did not go into effect until Oct. 30,1933.
30
T
COOPERATIVE MOVEMENT IN 193 3
able
22
.—DISTRIBUTION OF CONSUMERS' COOPERATIVE SOCIETIES ACCORDING
TO WEEKLY WORKING HOURS OF EMPLOYEES IN 1933
Number of societies in which weekly working hours were—
Type of society
Un
der
48
48
Over
48
and
under
Over
54
and
under
54
54
Retail store societies dealing in—
Groceries___________________
Groceries and meat _
General merchandise
_
_
Fuel____ ____ ______________
Students’ supplies__________
Total _
__
_
_____
Distributive departments of mar
keting associations____ ____ ___
Gasoline and oil associations_____
Bakeries_______________________
Restaurants and boarding houses.
Other societiesi. .
Grand total
_
.
_
Over
60
and
under
60
60
Over
72
Total
72
72
6
10
12
1
12
5
23
7
5
11
2
1
5
11
4
29
1
3
11
1
4
47
26
100
1
4
12
29
40
13
23
8
44
2
7
178
1
19
4
2
2
3
4
4
8
4
2
1
1
9
1
3
10
65
3
3
1
29
106
3
6
4
36
101
50
20
50
3
17
326
3
1
4
2
4
6
2
17
32
*Includes a creamery, a laundry, a water-supply society, and a publishing association.
Cooperative Policies
Policy as regards credit.—Because of the fact that the granting of
credit has been one of the most frequent and potent causes of business
failure among cooperative societies, each association was asked
regarding its credit policy. On this point 440 societies responded,
of which 117 replied flatly that they extend no credit whatever and
2 other societies stated that they “try not” to give credit. Credit
is extended by 321 societies, but 5 societies report that this is “re
stricted”, 2 grant it only in certain departments, 2 only to certain
members, 1 only when the account is guaranteed, 2 societies only
occasionally, and 1 society which operates 7 stores runs 3 of these
on a cash basis.
One society, now operating on the cash basis, reports as follows:
Since 1929 the business has steadily declined until it had become practically
nonexistent last year. This was caused through failure of the two banks, one
closing in August 1931 and the other in August 1932. One payment of 18 percent
was made by the first bank, but the money was deposited in the second bank,
and there have been no dividends paid by either since, with no prospects of any
unless a Government loan can be had. These banks closing with nearly a million
dollars of deposits has bankrupted this entire community, and as this is a farming
town, there has been no opportunity for the people to recuperate. I am making
this statement in order that you can get an idea of the impossibility of adhering
to a sound credit policy when a community finds itself without funds suddenly,
and the danger a business of this type runs at such a time. The usual thing
happened in this case, credit was given to any and all, without limit, until the
already meager funds of the society were exhausted; stocks were depleted, debts
accumulated, until the directors finally awakened to the fact that their business
was practically bankrupt, the manager having cpncealed the true condition as
long as possible.
CONSUMERS’ ORGANIZATIONS
31
Another society reports that it put its business on a cash basis
September 15, 1932. This resulted in a falling off in sales at first,
but after a year’s trial the society has found the new policy to be to
its advantage.
A third states: “We are selling to quite a few of the unemployed,
hoping for prosperity. Result: We are in the red. ” Another with the
same policy states: “We have extended credit to our members during
the depression and have helped many of our unemployed members.”
A Middle West society reports: “While we do some credit busi
ness, there is no open account to anyone. Credit is given only if
secured by timber, cream, etc. ”
An eastern society keeps down its credit accounts by a rule that
dividends are denied to members owing accounts of over $25, and
interest on share capital is withheld if the account goes over $50.
Voting.—Reports as to their voting methods were received from
447 associations. Of these, 396 allow only 1 vote per member regard
less of the number of shares owned, but 1 of these societies makes an
exception to this general policy in the election of directors, and
another allows a single vote to members who contribute “loan
capital” to the association, but denies voting privileges to the socalled “customer members” who pay only a $3 fee each year for the
trading privilege. Of the 51 societies in which voting is by shares,
1 society restricts the votes to a maximum of 5 per member.
Reports as to proxy voting were received from 413 societies, of
which 268 prohibit such voting, 142 allow it, 1 allows proxy voting
“at times”, and 2 limit the number of proxies voted to 1 per person.
Development Since 1920
T
23 gives comparative data for each of the years in which
the Bureau has made a general survey of the consumers’ cooperative
movement. As the remarkable development of the gasoline and oil
associations since 1925 affects the averages decidedly, the table
shows separately data for all types of societies (including the oil
associations) and for retail store societies which form the other most
important group of organizations.
Average membership per society, as the table indicates, has shown
a steady increase. A considerable rise is shown from 1929 to 1933.
Whether this was due to the hard times of the past few years, impress
ing upon purchasers the need of making the family income stretch as
far as possible, or to increased efforts by societies to bring in new
members, the data at hand do not indicate. The store societies
showed a particularly gratifying increase, the average membership
increasing by one-third during the 4-year period.
Share capital per society shows a continuous fall since 1920, for all
societies combined. That of the store societies, however, increased
able
32
COOPERATIVE MOVEMENT IN 1 9 3 3
somewhat from 1929 to 1933. A decline was also registered in share
capital per member. For both groups of societies shown in the table
average reserve funds increased during the period 1929-33, due
possibly to the desire of the societies to insure the business stability
of the organization in these uncertain times.
Although the average volume of business in dollars decreased from
1929 to 1933, this was to a large extent due to a lower price level.
It is seen that the high point of sales occurred in 1925.
For all societies combined, the peak of net earnings occurred in
1929. In comparison with 1929, average earnings of the store socie
ties in 1933 show a sharp decline. A decrease was shown for all
types combined, but the savings effected by the oil associations
resulted in keeping up the average for the whole group, so that the
decrease was not so great.
For all societies combined the average amount returned in patron
age refunds has not varied greatly since 1925. That it was the
dividends of the increasingly important oil associations, however,
which operated to keep up the average is shown by the fact that the
average for the retail store societies alone fell from $4,564 in 1929
to $2,926 in 1933.
T
able
23.—DEVELOPM ENT OF CONSUMERS’ COOPERATIVE SOCIETIES, 1920 TO 1933
Item
1920
Retail store societies
All societies
1925
1929
1933
1925
1929
1933
656
695
422
1,009
431
Number of societies reporting.
479
235
Membership:
260,060 139,301 204,368 225,441 119,760 123,317 76,160
Total____ ____________
269
336
303
389
293
407
Average per society.............
310
Share capital:
Total_________________ $11, 290,973 $6,499,574 $7,987,090 $6,867,951 $5,255, 534 $4, 653,197 $2, 774,664
Average per society............
17,056 16,455 13,607 12, 352 14,518 12,149 12,966
45
Average per member 1____
59
46
68
37
63
43
Reserve funds:
Total___________ _______ 1, 614,4831 2,407,676 4,324,375 3,882,805 2,168,190 2,875, 296 1, 865, 751
9,442
5,142
7,379
9,956
Average per society...........
9, 266
7, 261 12,522
Amount of business:
Total....... .......................... 80,104,935 49,710,788 64, 665,369 40,431,308 40,745,610 37,697, 560 14,372,118
103,751 100,964 100,725 60,435 96, 647 90, 619 62,760
Average per society.............
Net earnings:2
Total___________________ 446,824 1,582,100 2,980,481 1,935,996 1,291,309 1,305,671 224,167
2,828
4, 753
5,257
4,262
1,144
Average per society---------3,625
3,637
Rate (percent) computed
Sales___________ ____
3.0 (3)
5.5
3.8
4.0
1.7
(*)
Share capital________
23.5 <*>
26.8
8.9
(3)
(3)
<*)
Interest paid on share capital:
Amount________________
$337,587 $157,186 (3)
$173,217 $46, 381
(3)
(*)
895
Average per society.............
774 (3)
568
760
(3)
(3)
Patronage refunds:
Total..................................... $350,354 $753,791 1,408,879 1, 229,975 $683,726 693, 777 169,701
5,092
4,562
Average per society.............
4,943
4,641
4,564
2,926
4,440
Employees:
2,222
<4,046
*3,252
Number_________ _______
1,
314
(3)
(3)
7
7 (8)
5
Average per society......... .
7
(3)
(3)
1 Based on societies which reported both capital and membership.
* After deducting losses of those societies which sustained a loss.
3 No data.
* And 7 part-time employees.
'And 41 part-time employees.
33
CONSUM ERS’ ORGANIZATIONS
Housing Societies
T h e median monthly rental for the apartments of the cooperative
housing societies which reported to the Bureau was between $40 and
$45 per month. For the most part this rental was paid for 4-room
apartments. The members also had an investment in the enterprise
amounting to from $500 to $1,000 per room. Of the 21 societies
which furnished data, 13 were in Brooklyn and 8 were in Manhattan
and the Bronx.
The oldest of these societies was organized in 1916, 2 were formed
in 1919, 6 in 1920, 2 in 1921, 3 in 1922, 1 in 1923, 2 in 1924, 2 in 1925,
1 in 1928, and 1 in 1930. The average age, all societies combined,
was 11% years.
Table 24 shows that of 626 shareholders (members of the societies)
only 484 were occupying apartments in the buildings, while 203
apartments were rented to nonmembers. Paid-in share capital
amounted to slightly over $900,000. The present value of the
cooperative buildings (i. e., at the end of 1933) was reported as
$2,629,663, as compared with an original value of $3,292,751. The
total assets of the 21 societies reporting were nearly 2}{ million dollars.
Table 24.—-SHAREHOLDERS, TENANTS, AND ASSETS OF COOPERATIVE APARTM ENT
SOCIETIES, END OF 1933
Item
Cooperative apartment
buildings in—
Brooklyn
Number of shareholders (members)------------------------- --------- Number of apartments occupied by—
M embers__________________________________________
N onmembers________________________________________
Paid-in share capital_____________________________________
Value of apartment buildings:
Original __ ___ __ _______________________________
Present _ _ _ _ __ _ _____________________________
Total assets_____________________________________________
331
229
114
$400, 540
$1,502, 220
$1,072, 329
$763,070
Manhattan
and Bronx
295
255
89
$499,518
$1,790, 531
$1, 557,334
$1,456,740
Total
626
484
203
$900,058
$3, 292, 751
$2,629,663
$2,219,810
In the truly cooperative housing societies the members do not receive
title to the apartment they select; they own capital stock of the soci
ety in an amount equal to the value of the apartment. Title remains
with the society, so that the whole building is owned collectively.
Generally the whole amount of the stock does not have to be paid
for at once. The member is usually required to make a down pay
ment, and the balance is paid in monthly installments (rental) which
are large enough to cover his payments on principal, interest, and his
proportionate share of the cost of building maintenance. The cost
of interior decoration of the apartments is generally borne by the
member occupying the apartment.
In 2 of the societies reporting, the initial payment per room was
less than $100, in 2 societies $100 and under $200, in 3 societies $200
34
COOPERATIVE MOVEMENT IN 19 3 3
and under $300, in 1 society $300 and under $400, and in 3 societies
$400 and under $500; in 1 organization the member was required to
make an initial payment of $500 on his apartment, in 1 a payment
of $600, in 1 a payment of $900 or $1,000 depending on size of apart
ment, and in 1 a payment of $2,000.
The total cost per room was less than $500 in 4 societies, $500 and
under $750 in 1 society, $750 and under $1,000 in 2 societies, and
$1,000 and over in 1 society. The total cost per apartment was
less than $1,000 in 1 society, $1,000 and under $2,000 in 1 society,
and $2,000 and over in 1 society; in 1 organization the total cost per
apartment ranged from $1,600 to $6,000, according to the size and
location of the apartment, and in another from $6,000 to $8,300.
Table 25 shows the monthly payments required in apartments of
specified size. In figuring the number of rooms, the bathroom was
not counted, but the kitchen was considered as a room and a dining
alcove was counted as half a room.
T able 25.—DISTRIBUTION OF COOPERATIVE APARTMENTS ACCORDING TO
NUMBER OF ROOMS AND MONTHLY RENTALS
Monthly rental
Under $25...............
$25 and under $27.50.
$27.50 and under $30.
$30 and under $32.50.
$32.50 and under $35.
$35 and under $37.50.
$37.50 and under $40.
$40 and under $45__
$45 and under $50__
$50 and under $55—
$55 and under $60..
$60 and under $65— .
$65 and under $70—
$75 and under $80—
$80 and over_______
Rent not reported...
Total................
Number of apartments of specified size, with
classified monthly rental
5
1 room 2 rooms 3 rooms 4 rooms 5 rooms Over
rooms
14
»3
4
2
4
4
4
1
1
20
1
2
2
1
13
5
5
377
19
•17
6
14
2
3
1
5
5
6
17
if 182
7
16
16
«1
*5
7 77
•9
14
3
• 24
20
ii 192
Total
7
11
21
22
1
15
15
17
17
13
9
1
3
12 91
•5
•9
54
27
1
9
10
65
93
39
34
107
36
24
50
4
15
18
42
40
563
i Apartments of 1J^ rooms.
• Includes 2 apartments of 2K rooms, and 1 apartment on which rent was reduced 10 percent after Oct.
1, 1933.
• Includes 61 apartments of 3^ rooms.
4 4M rooms.
• Rent reduced 10 percent after Oct. 1, 1933.
• Includes 9 apartments of 3M rooms.
7 Includes 31 apartments of 4H rooms.
• Apartments of 4H rooms.
®Includes 2 apartments of 4 rooms and 2 baths each.
i° Not including 12 apartments with monthly rentals ranging from $22.60 to $25.70 and 10 apartments
with monthly rentals ranging from $23 to $31.
11 Not including 12 apartments with monthly rentals ranging from $29.70 to $34.70 and 18 apartments
with monthly rentals ranging from $31 to $38.
12 Not including 32 apartments with monthly rentals ranging from $32.50 to $39, 16 apartments with
monthly rentals ranging from $36.90 to $41.70, and 7 apartments with monthly rentals ranging from $37
to $43.
The most common size of cooperative apartment was that having
3 or 4 rooms. Among the three-room apartments, the largest group
included those on which the monthly “rentals” ranged from $32.50
CONSUMERS' ORGANIZATIONS
35
to $35, and among the four-room apartments the largest group
rented for from $40 to $45. The largest as well as the median group,
all sizes of dwelling units combined, was that of apartments renting
for $40 and under $45. Slightly over three-fifths of the whole number
of dwellings reported for involved monthly payments of less than
$60. As already indicated, these amounts represent the members'
amortization payments, interest, and the proportionate share of
building maintenance.
The total income during 1933 of the 21 societies was $344,562.
As already indicated, it is not good cooperative practice to give
title to the individual members, but 5 of the 20 societies reporting
on this point do allow the members to hold title to their apartments;
in the other 15 societies the member owns only stock in the association.
Another cooperative principle in the housing field is that the members
should never be allowed to sell their apartments at a profit; under
good cooperative practice the member is required to sell back his stock
to the association, receiving only what he paid for it minus any sums
necessary to cover damage to the dwelling. However, 16 of the
societies reporting allow their members to sell their apartments at a
profit. Fifteen societies allow the subletting of apartments to non
member tenants; another allows subletting but restricts the practice
as much as possible, 1 society allows it only during the summer
months, 1 society restricts the “mark-up ” to that amount which covers
the use of furnishings only, and another stipulates that subletting
shall be without profit. Two societies prohibit the subletting of
apartments.
The 20 societies furnishing pay-roll information employed 38 full
time and 7 part-time workers in 1933 and paid $28,532 in wages.
Residential Hotels
T h e r e are in Washington, D. C., two cooperative residential hotels.
The first of these was started in 1922 and the other in 1928. For
1933 a report was received from the latter organization only.
The second hotel project may be said to have grown out of the
first, although the personnel of the cooperative group was different.
The association was formed in 1928 and, after many difficulties,
moved into its building December 1, 1929. It is a 7-story building
having 168 rooms with private bath and 56 suites of 2 rooms each,
which share 1 bathroom.
Each member must purchase 5 shares of preferred stock and 1
share of common stock. There is no limit to the number of shares of
preferred stock that may be held by any one person but no stock
holder may own more than one share of common stock and only the
common stock carries the voting privilege. Thus in practice each
member has only 1 vote.
36
COOPERATIVE MOVEMENT IN 1 9 3 3
The cost to the member has ranged from $200 to $500 per room, of
which $50 must be paid down and the balance may be paid in install
ments of $10 per month. Monthly basic rents range from $25 to
$35; those of nonstockholders from $30 to $41.
Members merely hold stock to the value of the room occupied by
them; they do not receive title. The paid-in share capital at the
end of 1933 amounted to about $50,000.
The original value of the building was $676,000; its value in 1933 was
estimated at $630,000. The total assets amounted to $720,660.
The hotel had 250 tenants of whom 100 were stockholders; there
were also 114 stockholders not residing in the hotel. As this hotel is
situated just off the Union Station Plaza and in the neighborhood of
the House and Senate Office Buildings, it attracts many of the young
women employed in that vicinity.
Elevator service, cafeteria, and a laundry room for the use of the
guests are among the conveniences provided. There is an elaborate
lobby, small writing nooks, and parlors for the entertainment of
guests, as well as a ballroom. Meals are charged for at the rate of
$22.50 a month for breakfast and dinner.
The hotel is managed by a board of 5 directors, elected by the
members. It employs an average of 28 persons and paid in wages
during 1933 about $17,000. The total income for 1933 amounted to
$101,947.
Insurance Societies
M
than 100,000 policyholders, and new insurance written in
1933 amounting to slightly over $6,000,000, was reported by the seven
consumers’ cooperative insurance associations from which returns were
received. Premium income for the year amounted to over $800,000,
and claims paid totaled nearly $428,000.
Of the 7 associations, 3 write fire insurance (1 on farm property
only, and 1 on furniture and houses), and 3 write life insurance (2 of
these also write health and accident insurance). Table 26 shows the
year of organization and the kind of business done by each society.
The Consumers’ Mutual Aid Guild is really a mutual-benefit society
operating on the assessment plan. The Associated Cooperative Fire
Insurance Co.’s is an association of 5 companies operating in Sullivan
and adjoining counties, New York.
In addition to the organizations shown in the table, the consumers’
cooperative societies federated in the Cooperative League have an
insurance service, Clusa Service, Inc., with headquarters in New York
City. Its function is “to buy insurance from existing insurance car
riers to the best advantage of the assured.” The insurance so pur
chased includes employees’ bonds and fire, casualty, and life insurance
and annuities.
ore
37
CONSUMERS’ ORGANIZATIONS
T
a ble
26.
—YEAR OF FORMATION AND KIND OF INSURANCE W RITTEN BY
COOPERATIVE INSURANCE SOCIETIES
Year
of or
gani
zation
State and city
Name of society
Illinois: Blooming
ton.
Michigan:
Grand Rapids. __
Rock______ ...
New York:
New York..........
Consumers’ Mutual Aid Guild____
New Era Life Association_______
Rock Farmers Mutual Fire Insur
ance Co.
Workingmen’s Cooperative Associa
tion.
Workmen’s Furniture Fire Insur
ance Society.
Woodridge_____ Associated Cooperative Fire Insur
ance Co.’s.
Kind of insurance written
1927 Life, and accident resulting in perma
nent total disability.
1897 Life, health, and accident.
1915 Fire insurance on farm property.
1886 Life, health, and accident.
1872 Fire insurance on furniture and
houses.
19131 Fire insurance on farm and other
property.
1 Year of organization of the first of the 5 companies; others organized in 1920, 1922, 1923, and 1926.
Business operations.—Table 27 shows, for 1933, new insurance
written amounting to slightly over $6,000,000. At the end of the
year the six societies covered had a total of 100,395 policyholders and
insurance in force amounting to more than $110,000,000. New
insurance written during the 4 depression years totaled $28,917,508.
T able
27.—NEW INSURANCE W RITTEN, 1930 TO 1933, AND NUM BER OF POLICYHOLD
ERS AND AMOUNT OF INSURANCE IN FORCE, END OF 1933
New insurance written in—
Society
Consumers’ Mutual Aid Guild_____
Associated Cooperative Fire Insur
ance Co.’s.
New Era Life Association________
Rock Farmers Mutual Fire Insur
ance Co___
__________ __ .
Workingmen’s Cooperative Associa
tion______________ __ __
_
Workmen’s Furniture Fire Insurance
Society---------------- --------------------Total............................................
Number
of policy
holders,
end of
1933
Total in
surance in
force, end
of 1933
491
0)
(8) 700 $1, 009,104
0)
. (1) 972 $407,803
7, 477
$620,
$540,
378, 375 694, 248 427, 625 1, 587, 385 15,715
1, 735,490 1,707,364 983,550 581, 380 1,618
2,340,479 1, 228,133 11,829
(5)
(5)
5,590, 250 4,003,875 3, 479, 625 1, 601,150 63, 265
8, 245,087 6,813,290 7,851, 979 6,007,152 100, 395
$11, 207, 250
16,184,390
4,320,051
766,901
79, 665, 470
112,144,062
1930
1931
1932
1933
1 51 new members added.
2 38 new members added.
315 new members added.
4 28 new members added.
5 No data.
The Consumers’ Mutual Aid Guild and the Eock Farmers’ Mutual
Fire Insurance Co. both operate solely on the assessment plan. The
Workmen’s Furniture Fire Insurance Society requires from each
policyholder a deposit of $1 for every $100 worth of new or additional
insurance and makes an annual charge of 10 cents per $100 of insur
ance. The Associated Cooperative Fire Insurance Co.’s charges an
38
COOPERATIVE MOVEMENT
IN 19 3 3
initial fee of 10 cents per $100 of insurance; the remaining premium
is levied each year as an assessment in whatever amount is necessary
to cover the obligations and losses.
The premium income during 1933 was, as table 28 shows, $803,496,
and during the 4-year period amounted to $3,534,239. In addition
to the societies shown in the table, Clusa Service, Inc., had a gross
income for the year 1933 amounting to $37,759.
T able
28.—PREMIUM INCOME OF COOPERATIVE INSURANCE SOCIETIES, 1930 TO 1933
Society
Premium income
1930
Consumers’ Mutual Aid G uild------------------------------------------ $2,479
Associated Cooperative Fire Insurance Co.’s__ _____________ 124,467
New Era Life Association_________ _________ __________ _ 700, 600
Rock Farmers Mutual Fire Insurance Co--------- ------------------- 18,670
Workingmen’s Cooperative Association____ ____________
0)
Workmen's Furniture Fire Insurance Society----------------------- 64,995
T otal-.______________ _________ ________ _______ 911, 211
1931
1932
$3, 717
160,167
652, 528
22,765
0)
68,603
$3,065
147,080
573,645
26,084
89,171
72,707
911,752
907, 780
1933
$2, 234
127,584
509,065
25,086
63, 584
75,943
803,496
1 No data.
Claims paid during 1933 by the five societies for which data are
available amounted to $427,803, as follows:
Amount paid
in claims
Consumers’ Mutual Aid Guild (death)__________________
$709
New Era Life Association:
Death_____________________________________________ 265, 305
Sickness and accident______________________________
415
Rock Farmers Mutual FireInsurance Co.(fire)__________ 17, 071
Workmen’s Furniture Fire InsuranceSociety (fire)________ 60, 136
Associated Cooperative Fire Insurance Co.’s (fire and
lightning)___________________________________________
84, 167
Total___________________________________________
427, 803
Dividends were returned to policyholders by three societies, as
follows:
Amount returned
in dividends
New Era Life Association______________________________ $23, 468
Rock Farmers Mutual Fire Insurance Co________________
118
Associated Cooperative Fire Insurance Co.’s____________
196
Total____________________________________________
23, 782
Employment and wages.—Employees to the number of 76, a pay roll
for 1933 of $115,664, and average yearly earnings per employee of
$1,522 are shown in table 29.
39
CONSUMERS’ ORGANIZATIONS
T able
2 9 —EMPLOYMENT AND PAY ROLL IN COOPERATIVE INSURANCE SOCIETIES,
1933
Society
Consumers’ Mutual Aid Guild_____ ____ ________ ___________
Associated Cooperative Fire Insurance Co.’s____________________
New Era Life Association-------------- ------ -------------------- ------ -----_________
Rock Farmers Mutual Fire Insurance Co________
Workingmen’s Cooperative A s so c ia tio n ._____________________
Workmen’s Furniture Fire Insurance Society___________________
Total____ __________________________ __________________
Number of
employees
1
10
41
2
17
5
76
Wages paid, 1933
Total Average per
amount employee
$900
14, 505
44,703
2,173
27,933
17,350
116, 564
$900
1,451
1,090
1,087
1,641
3,470
1,522
Health Association
A r e t u r n was received from a cooperative health association in
Oklahoma which operates a hospital. This association was organized
in 1930, and at the end of 1933 had paid-in share capital of $81,000.
The amount of the individual share—$50—is higher than in most other
types of cooperative associations.
The payment of a fee of $12 a year entitles the member and his
family to physical examination (including blood test and urinalysis)
and free prescriptions; it also entitles them to surgical operations and
obstetrical service at low rates. A major operation, for example, can
be obtained for $20; and room, board, and nursing for $4 a day.
During 1933 the number of patients admitted to the hospital
totaled 452, as against 251 the year before. Income from hospital
fees in 1932 was $12,581.40 and in 1933 was $14,959.62.
Beginning May 1934 the association added the following benefits on
a yearly fee basis: Dental work, $6; room, board, and nursing in hos
pital, $12; and burial, $6. All of these benefits are available to hus
band, wife, and all unmarried children under 21.
Chapter 3.—Central Consumers’ Organizations
F
EDERATED cooperation is exemplified by two types of socie
ties—the cooperative leagues which are purely educational and
propaganda bodies, and the cooperative wholesale societies which are
commercial organizations. Both types of organizations are owned
and controlled by the constituent local cooperative societies. The
wholesales are capital stock associations whose shares are held by the
member societies, but the leagues are nonstock organizations financed
by dues paid by the locals.
Cooperative wholesaling has had a checkered career in the United
States. After a boom period immediately following the war, this
branch of cooperation went into practical eclipse for a number of years,
and only a few well-managed wholesales were able to survive.
The chief development of the past decade has been the formation
of wholesale societies handling only petroleum products. Also sig
nificant w^as the formation, in 1933, of National Cooperatives, Inc.
Profiting from the experiences of 1919-21, and the disastrous failure
of the wholesale organization started during that period with the idea
of its becoming a Nation-wide wholesale, the new wholesale is pro
ceeding cautiously, acting rather as jobber than as wholesaler, and
doing joint buying of petroleum products, tires, and other automobile
supplies, for the six district wholesales which are its members and
backers.
Considering the unusually adverse conditions of the period since
the Bureau’s last previous survey of the cooperative movement was
made (1929), the wholesale societies have given a demonstration of
remarkable stability and strength. Reports were received from the
new national wholesale and from 8 of the 11 regional wholesales.
The district wholesales had a combined membership of 918 local
societies, and 4 of them were operating 50 retail branches. Societies
not affiliated with the wholesales but making purchases from them
numbered 170. Thus at the end of 1933 there were 1,088 local socie
ties which were being served by the wholesales. Six of the district
wholesales were in turn purchasing through the national wholesale.
The district organizations had a combined capital of $699,885,
reserves amounting to $372,782, and total resources of $1,931,053.
Their total business during 1933 amounted to $8,748,726. All but
one of the district wholesales realized a net gain on the year’s trading
operations, aggregating $169,465; the net loss of the other society
40
CENTRAL CONSUMERS’ ORGANIZATIONS
41
amounted to $1,747. Interest paid on share capital in 1933 amounted
to $22,752 and patronage dividends amounted to $108,152. The
patronage rebate represented 15.5 percent computed on share capital
and 1.2 percent computed on sales. During the 4 years from 1930 to
1933 these societies realized a gain each year, in spite of the depres
sion. For the 4-year period the net gains, all societies combined,
totaled $475,623. During the same period they returned to their
members $758,096 in interest and dividends.
These societies employed 304 workers and had a pay roll for 1933
of $427,303.
Commercial Organisations (Wholesale Societies)
R eports were received from the new national cooperative wholesale
society and from 8 of the 11 regional wholesales.
Table 30 shows the merchandise handled by the wholesale societies
and the other services rendered (such as educational, auditing, etc.).
As the table shows, all but two of the societies handle petroleum
products. Very little manufacturing is done thus far.
In general the wholesale societies leave most of the cooperative
educational work to be done by the district leagues organized for that
purpose. It is seen, however, that five of the wholesales have educa
tional departments. The Central Cooperative Wholesale has an
active educational department with a full-time director. For about
the past 15 years it has conducted an annual course lasting from 6
to 8 weeks, primarily for the purpose of training employees and man
agers for cooperative societies.
Six of the wholesales furnish auditing service, for a total of 664
societies. The value of such service cannot be overemphasized, for
many failures of cooperative societies could have been avoided by
systematic audits which would have revealed the danger points and
weaknesses which later proved fatal to the society.
T able
3 0 —LINES OF GOODS HANDLED BY COOPERATIVE WHOLESALE SOCIETIES,
AND OTHER SERVICES RENDERED
State and city
Name of wholesale
Goods handled
Goods manu
factured
Other services
National wholesale
Indiana: Indian National Cooper Petroleum products, auto
atives, Inc.
mobile tires, tubes, and
apolis.
batteries.
Regional wholesales
Minnesota: Min Midland Cooper Petroleum products, auto Lubricating
ative Wholesale, mobile tires, batteries, and oil.
neapolis.
bulk-station equipment.
Inc.1
Missouri:
Educational de
Kansas C ity... Farmers’ Union General merchandise, mill
Jobbing Associ feeds, salt, and twine.
partment; au
ation.
diting.2
1 Name originally Minnesota Cooperative Oil Co., changed first to Midland Cooperative Oil Association
and then to Midland Cooperative Wholesale.
2 Used by 150 societies.
42
T able
COOPERATIVE MOVEMENT IN 1 9 3 3
3 0 —LINES OF GOODS HANDLED BY COOPERATIVE WHOLESALE SOCIETIES,
AND OTHER SERVICES RENDERED—Continued
State and City
Name of wholesale
Goods handled
Goods manu
factured
Other services
Regional whole
sales
—Continued
Missouri—Contd.
North Kansas Cooperative Un Petroleum products, auto Lubricating Educational deion Oil Co.
mobile tires, tubes, and oil.
partment; auCity.
diting.3
batteries.
Nebraska: Omaha. Farmers’ Union General merchandise, farm
Do.4
State Exchange. supplies, petroleum prod
ucts, and car-lot orders of
produce, coal, and salt.
Do.8
Ohio: Columbus... Ohio Farm Bu Petroleum products, coal, Feed________
reau Service Co. and farm supplies.
Texas: Amarillo__ Consumers Asso Petroleum products, tires,
tubes, and accessories.
ciated.
Washington: Seat Grange Coopera Groceries, petroleum prod
Auditing.6
tle.
tive Wholesale.
ucts, and feed.
Wisconsin: Supe Central Coopera Groceries, clothing, bakery Bakery goods. Educational derior.
partment; autive Wholesale.7 products, light hardware,
diting.8
automobile tires, and
building materials.
3Used by about 250 societies.
4 Used by about 60 societies.
8 Used by 88 county branches.
0 Used by 35 societies.
7 Name formerly Cooperative Central Exchange.
8 Used by 81 societies.
Organisation of Wholesale Organisations
Generally the cooperative wholesale societies are owned by the
constituent local (retail) societies which hold the capital stock of the
wholesale. Exceptions to this are National Cooperatives, Inc., whose
stock is held by six of the district wholesales, and the Ohio Farm
Bureau Service Co., which is owned by the Ohio Farm Bureau Cor
poration.
The policies of the wholesale societies are controlled by the general
meetings of representatives of the member societies. In the meetings
of the Farmers’ Union State Exchange and the Midland Cooperative
Wholesale each member society has one vote. Representation at
meetings of the Central Cooperative Wholesale depends on the mem
bership of the local societies, each local being allowed 1 delegate and
vote for every 50 members.
Membership and Resources
T able 31 shows the year of organization of the individual socie
ties, the number of members and purchasers, and the resources.
The two Farmers’ Union wholesales are the oldest of those re
porting, each having been in operation for 20 years. The youngest
organization shown is the new national wholesale, formed in 1933.
CENTRAL CONSUMERS’ ORGANIZATIONS
43
Only cooperative societies are admitted to membership in most of
the cooperative wholesale societies. The Nebraska wholesale, the
Farmers’ Union State Exchange, however, accepts only societies
and persons affiliated with the Nebraska Farmers’ Union, and the
Grange Cooperative Wholesale admits only Grange organizations.
The 8 district wholesales were serving 918 member cooperative
societies and 170 other societies which were not affiliated. The opera
tion of retail branches has been a method rather infrequently prac
ticed in the United States, but as the table shows, 4 of the wholesales
had 50 retail branches at the end of 1933. The Ohio Farm Bureau
Service Co. operates on a somewhat different basis from the other
wholesales. The Farm Bureau societies are set up on a county basis,
and the Ohio Farm Bureau Service Co. is the purchasing agent for 88
county departments; in 28 counties it has taken over and is now
operating the local organizations as branches.
T able
31.—MEMBERSHIP AND RESOURCES OF COOPERATIVE WHOLESALE
SOCIETIES AT END OF 1933
Year of
organi
zation
Society
Number Retail Unaffili
ated Paid-in Reserve Total
of affili branches customer
share fund assets
ated of whole organi capital
societies sale zations
District wholesales
Central Cooperative Wholesale________
Consumers Associated_________ _____
Cooperative Union Oil Co_________
Farmers’ Union Jobbing Association__.
Farmers’ Union State Exchange______
Grange Cooperative Wholesale_______
Midland Cooperative Wholesale______
Ohio Farm Bureau Service Co______ Total_________________________
1917
1930
1929
1914
1914
1919
1927
1923
99
32
250
270
260
7
0)
918
9
12
1
(0 28
50
20 $147, 783 $22,149 $307,614
15,000 3,240 39,210
75, 323 12,367 245,999
25 60,930 100,532 276, 628
340, 775 21,486 590, 562
37 10,644 2,159 32, 365
0) 88 49,0)430 210,(0849 438,
0) 675
170 699,885 372,782 1,931,053
0)
National wholesale
National Cooperatives, I n c ._________
1 No data.
1933
6
1, 600
1,244
Business Operations and Results
T
32 shows, for each of the 4 years from 1930 to 1933, the
amount of business done, the net savings effected (i. e., “net gain”),
and the amounts paid to member societies in interest on share capital
and in patronage refunds. It is of interest that although each of the
merchandise societies showed some decrease in sales during the 4-year
period, all 3 of the societies handling only petroleum products showed
an increase in business in each year. The year 1933 showed improved
business in 3 of the 4 merchandise societies for which data were
available for both 1932 and 1933.
able
144224°—35-----4
44
COOPERATIVE MOVEMENT IN 1 9 3 3
Of the 9 societies, all but 2 showed a net trading gain in each year,
in spite of the depression. For the 4-year period gains aggregated
$697,418 and losses $221,795, making a net gain, all societies combined,
of $475,623. The sum of $758,096 was returned to the member
societies in interest on share capital and in refunds on their purchases
from the wholesale.
BUSINESS, NET GAIN, INTEREST PAID ON SHARE CAPITAL, AND PATRON
AGE REFUNDS OF COOPERATIVE WHOLESALE SOCIETIES, 1930 TO 1933
T able 3 2 .—
Society
Net gain
Amount of business
1930
C entral C ooperative
Wholesale____________ $1,767,760
Consumers Associated___
Cooperative Union Oil Co_ '"'489,137
Farmers* Union Jobbing
Association___________
)
Farmers’ Union State Ex
change________ _____ 2,118, 212
Grange C ooperative
Wholesale____________ 119,855
Midland C o o p e r a t i v e
Wholesale____________ 600, 239
N a t i o n a l Cooperatives,
Inc__________ ______
Ohio Farm Bureau Service
Co___________________ 6,029, 044
Total.
11,124, 547
0
$1,383, 290
128, 384
1,493,843
56, 569
1, 244,993
102,378
1, 073,567
0)
3,946,889 2,401,867 3, 265, 702
8, 919, 488 7,377, 284 8, 748, 726
$1,509, 752 $1, 309, 698
86, 662
51, 453
981,491 1,328,629
0)
0)
1, 571,028 1,192,838
243, 487 173,854
615, 388 883,736
2,'546
(5)
19, 386
(0
(6)
21,932
(3)
3,917
(5)
0)4, 057
(51
19,193
0)
12, 658
23,110
16, 715
0)
1932
$12,035
1, 376
45,900
45, 450
64, 732
1, 274
21,163
$9, 091
4, 901
26,103
14,194
34,912
1,984
26, 906
1933
$13,133
3, 592
36, 978
26, 260
61, 945
2,091
25,466
2 356
242, 342 2124,475 252, 875 2 1, 747
175, 590 67, 455 65, 216 167,362
$29, 735
24,"978
76, 552
70,850
1,013
14,804
Patronage refunds
Interest on share capital
Central C o o p e r a t i v e
Wholesale____________
Consumers Associated___
Cooperative Union Oil Co.
Farmers’ Union Jobbing
Association___________
Farmers’ Union State Ex
change_______________
Midland Cooperative
Wholesale____________
Ohio Farm Bureau Service
Co___________________
Total.
1931
26,809 9,158 9,091 13,133
9,185 7, 572 6, 790
04,) 265 *16,'376 35,341
20,154 18, 266
48,900 23, 600 27, 081 16,000
(5)
18,487 44,142 39, 236 21, 786 35,963
(0
0) 18, 000
(0
0)
190, 568 36, 436
22, 752 326, 795 152,956 85, 684 108,152
1 No data.
2 Loss.
3 This society paid 10 percent interest but did not report amount so paid.
* This society paid 8 percent interest but did not report amount so paid.
« This society paid 6 percent interest but did not report amount so paid.
6 This society paid 4 percent interest but did not report amount so paid.
Of the 6 societies which reported in regard to their practice as to
the return of patronage dividends to nonmembers, 2 make no refunds
to nonmembers, and 4 pay the same rate as to members but 2 of
the societies report that the amount is credited on the purchase of a
share of stock in the society so that in the course of time the purchaser
automatically becomes a member.
45
CENTRAL CONSUMERS’ ORGANIZATIONS
Operating Expenses
T he operating expenses of the three reporting w holesale societies for
1933 am ounted to 10.79 percent of their sales. The statem ent below
shows the percent spent for each item of expense:
Sales expense:
Wages-------------------------------------------------------Other______________________________________
Total____________________________________
Miscellaneous delivery expense (except wages)_______
Rent__________________________________________
Light, heat, power, and water_____________________
Insurance and taxes_____________________________
Interest on borrowed money______________________
Office supplies and postage_______________________
Telephone and telegraph_________________________
Repairs________________________________________
Depreciation___________________________________
Bad debts______________________________________
Auditing_______________________________________
Legal service___________________________________
Miscellaneous___________________________________
Grand total______________________________
Z es
5. 10
. 38
5. 48
.86
. 54
.36
. 37
.03
.40
. 38
. 08
. 46
. 24
. 04
. 03
1. 52
10.79
Working Conditions
T able 33 shows a total of 304 persons em ployed, a pay roll of
$427,303 in 1933, average annual earnings per em ployee of $1,409,
and average w eekly working tim e of 43.3 hours.
T able
33.—EMPLOYMENT, PAY ROLL, AND WEEKLY WORKING HOURS IN
COOPERATIVE WHOLESALE SOCIETIES, 1933
Society
Central Cooperative Wholesale____ ________________________
Consumers Associated___________________ ___________ ____
Cooperative Union Oil Co__________ ____________________
Farmers’ Union Jobbing Association_______________ ______
Farmers’ Union State Exchange______ _ __
_________ Grange Cooperative Wholesale--------------------- -------------------Ohio Farm Bureau Service Co----------- --------------------------------Total............................................................................................
Number
of em
ployees
Amount paid in
wages, 1933
Total
55 $73,982
7
9,203
74 78, 743
6
8,955
37 42,214
6,906
3
122 207,300
304 427, 303
Average
per em
ployee
$1,345
1,315
1,064
1,493
1,141
2,302
1,699
1,409
Working
hours
per
week
44.0
(044.0
40.0
44.5
44.0
0)
43.3
1 Code hours worked.
Table 34 gives com parative data for the tw o types of w holesale
societies for 1929 and 1933.
46
COOPERATIVE MOVEMENT IN 193 3
T able 3 4 —DEVELOPMENT OF COOPERATIVE WHOLESALE SOCIETIES, 1929 AND 1933
Wholesale societies handling—
Item
Household supplies
1929
1933
Number of societies reporting... . . . _ _____ _
6
4
Number of affiliated societies________ _______ _____
351
636
34
Number of retail branches. _ _______ _ _ _ ______
13
Number of unafliliated customers_________________ _
82
20
Share capital.._______ _____ _ ____________________ $483, 312 $560,132
Reserve funds._____ _________ __________________ $135,308 $146,326
Amount of business________ _______________________ $10, 371, 060 $2, 787, 230
Net gain_________ ____________ . _____________ $297, 111 $103,429
Amount returned in patronage refunds______________ $225,500
$65,096
Interest paid on share capital_______________ _____
$26,864
$18,487
Number of employees---------------------------------------------132
101
Amount paid in wages.____________ ___________ ..
$132,057
0)
Gasoline and motor oils
1929
2
45
195
0)
0) 274
$757,
$12, 720
(2)
$206
5
0)
1933
5
288
37
88
$141, 353
$226, 456
$5,961,496
$63,933
$43,056
$4, 265
203
$295, 246
1 No data.
21 society returned 15 percent of the gross profits, amount not reported.
Educational Organisations (Cooperative Leagues)
Cooperative League of the U. S. A.
educational and propaganda purposes the local societies are
federated into a national organization, the Cooperative League of the
U. S. A., with headquarters in New York City. This organization
was formed in 1915. For a number of years the organization received
little or no financial support from the local societies, which were either
too weak or too indifferent to contribute to it.
As a start toward a national cooperative movement the league
called a convention, which was held in Springfield, 111., in 1918, at
which there was a small representation from the local societies.
Since that time congresses have been held every two years, and an
increasing number of societies has become interested in federated
action, so that the league may now be said to be really a federation of
the local societies and to be supported by them. The league admits
into membership only consumers ’ societies and is gradually inau
gurating a set of cooperative standards to which, eventually, socie
ties will be required .to conform in order to obtain admission to
membership.
The league has gathered many adherents in recent years. Its
report to the Bureau now shows a membership of 1,480 distributive
societies, 9 credit unions, 5 housing associations, and 4 insurance
societies—a total of 1,498 societies; at the end of 1928 its membership
consisted of 140 societies and 1,000 individual members.
Member societies pay dues to the national organization on the basis
of their membership. They are represented in the meetings of the
league by elected delegates, the stores and housing societies being
F or
CENTRAL CONSUMERS’ ORGANIZATIONS
47
entitled to 1 vote for each 500 members, and the insurance and credit
societies 1 vote for each 3,500 members.
The league carries on general educational work in the theory and
practice of cooperation, writing articles for the general press, fur
nishing speakers for meetings of local societies, and lecturers for the
cooperative schools and institutes and for colleges and universities
which offer courses in cooperation or economics. It also furnishes
legal and auditing services for member societies, besides doing some
organization work. Several summer institutes and training courses
have been held under the auspices of the league. It has issued a
number of films on cooperation and many publications on the vari
ous phases of cooperation and on correct cooperative practice, and
publishes a monthly magazine.
District Leagues
T here are also three district educational leagues, and others will
be formed as cooperative development shows the need. If there is
no district league in a given region a local society may affiliate directly
with the national league; otherwise affiliation is obtained with the
national league only through the medium of the district federation.
Northern States Cooperative League.—This league is the oldest of the
district leagues, having been organized in March 1922. It has juris
diction in the States of Minnesota, the Dakotas, Michigan, and
Wisconsin; its headquarters are in Minneapolis.
The league, in addition to its general educational work, has given
several training courses for the employees of cooperative societies.
It also furnishes speakers and films for cooperative assemblages, carries
on organization work, and furnishes auditing service. It acts as an
employment exchange for cooperative societies which need employees,
and workers who wish to obtain positions in the cooperative move
ment.
Until recently this league has issued a year book covering the
development of the societies in its district, along with articles on the
various phases and problems of the cooperative movement. By
action of the 1928 cooperative congress, however, the year book was
made national in scope, although its editing was still left to the
Northern States Cooperative League.
No report as to membership was received by the Bureau from the
league, for 1933.
Eastern States Cooperative League.—The Eastern States Co
operative League, whose territory is the New England and North
Atlantic States, has headquarters in New York City. It was formed
in 1925. From 1930 to 1933 its membership increased from 26 to
31 societies. At the end of 1933 this league had in affiliation 12
48
COOPERATIVE MOVEMENT IN 19 3 3
distributive societies, 5 housing associations, 4 credit unions, 2 in
surance societies, 6 bakeries, 1 oil association, and 1 restaurant.
The league carries on general educational work, besides holding
training courses for cooperative employees and summer institutes for
the membership generally. It furnishes speakers for meetings and
supplies its members with pamphlets on cooperative subjects. It
does organization and auditing service for local groups. The Eastern
Cooperative Wholesale Society was the direct outgrowth of the joint
buying carried on by the local societies through the league.
The league has two employees.
Central States Cooperative League.—The Central States Cooperative
League was formed in April 1927. Its district is the States of Illinois,
Ohio, and Indiana, and its headquarters are in Bloomington, 111. At
the end of 1933 it had in membership 15 distributive societies, 1
mutual-benefit society, and 2 educational organizations, besides 26
individual members.
This league, in addition to its general educational work, holds a
summer institute, carries on organization work, and supplies films,
speakers, and pamphlets. It also carries on joint buying of staple
articles for its member societies. A printing plant is operated by the
league, which serves both the league and its members at the cost of
time and material used.
The constituent societies have one vote for each 100 members or
major fraction thereof.
The league has two employees.
Other Federations
S ome of the local societies in the North Central States have formed
loose federations whose purpose is to knit the societies together more
closely and to form a medium of consideration of their common prob
lems. Some joint buying has also been done by these organizations.
Among the federations so formed are the Mesabi Range Cooperative
Federation in Northeastern Minnesota, the Marquette District Coop
erative League of societies in the vicinity of Marquette, Mich., and
the Northern Wisconsin Cooperative Federation of societies in the
Superior, Wis., region. No return was made for 1933 by the first
two organizations. The Northern Wisconsin Cooperative Federation,
however, reports that it had in membership at the end of the year 9
cooperative organizations—6 distributive societies, 2 wholesale
societies, and a cooperative park association. The federation does
general educational work, and gives financial aid toward the cooper
ative training courses and summer institutes held in the Northern
States district, as well as toward the women’s cooperative guilds,
Cooperative Youth League activities, and similar organizations. The
federation sponsors a district cooperators’ picnic every summer.
Chapter 4.—Credit and Banking Societies
Credit Unions
REDIT to the amount of more than $28,000,000 was made avail
able to the members of cooperative credit societies in the United
States during 1933. These credit societies, commonly called “credit
unions” in the United States, are organizations of persons perhaps
the majority of whom do not have and may never have had any
banking connections. They are designed to fill the credit needs of
workingmen and other small borrowers who can find few other sources
of credit at moderate rates.
Since 1925, legislation authorizing the formation of such societies
has been passed in a number of States, and such legislation was on
the statute books in all but nine States at the end of 1933. In 1934
C
the Federal Congress passed an act authorizing the incorporation ol
cooperative credit societies on a Federal instead of a State basis.
Under the stimulus of such legislation and the active encouragement
of several organizations interested in the promotion of the creditunion movement, cooperative credit societies have increased very
greatly in number since 1925. On the other hand, a considerable
number have gone out of existence since the Bureau’s last general
survey, covering the year 1929. To what extent these dissolutions
were the result of the depression the data at hand do not show. The
reports indicate, however, that some of the dissolutions were those of
societies formed among the employees of firms which have failed
since 1929.
Notwithstanding the nearly 300 credit unions reported as having
ceased operations since 1925, the number of organizations in business
at the end of 1933 was 5 times that at the end of 1925, having risen
from slightly over 400 to more than 2,000. About 50 percent of these
were started from 1931 to 1933. The simplicity of the credit-union
structure and procedxire and the increasing difficulty of obtaining
loans through ordinary sources of credit have undoubtedly contributed
to this growth.
Membership from 1925 to 1933 increased from a little over 100,000
to nearly 360,000. Possibly due to the formation of the many new,
small societies, the average size of society decreased, falling from 612
members in 1925 to 320 members in 1929 and to 215 members in 1933.
A small group, the members of which know each other, is considered
desirable from the point of view of the safety of the loans made, and
in the main the credit societies are of this character. More than
two-fifths of the whole number reporting had fewer than 100 members.
The largest society had more than 12,000 members but these were all
in one employment.
49
50
COOPERATIVE MOVEMENT IN 193 3
The funds from which the loans are made are built up from the
members’ pooled contributions, i. e., share capital subscribed by them.
In order to be a borrower, it is necessary also to be a member. If
there are more applications than the funds on hand will cover, it is
the usual practice to give preference to the smaller loans.
At the end of 1933 the credit societies reporting had share capital
amounting to $22,457,861, which was an average of $62 per member.
In addition some 50,000 members had deposited with these societies
savings aggregating $5,685,276, or $113 per depositor. Reserves to
cover possible losses had been built up amounting to $2,372,711.
Although the average assets per society were small—less than $5,000
in the case of more than 50 percent of the societies—4 associations
were found whose assets were $1,000,000 or more. The total re
sources of the societies reporting were $35,496,668 at the end of 1933.
During 1933, as already stated, these small societies made com
bined loans of $28,217,457, filling the credit needs of 206,295 borrow
ing members. This was an average of $138 per loan and an average
business of slightly under $23,000 per society for the year. Three
societies, during 1933, however, made loans aggregating more than
half a million dollars each, and one of these of over a million dollars.
The sum of $26,391,683 was outstanding at the end of the year.
The expenses of operation of credit unions were very low; for the
279 societies which furnished reports for 1933, they averaged only 2.21
percent (in terms of loans granted). There are very few paid em
ployees. Many credit unions have none at all, this not being neces
sary until the s6ciety attains a considerable volume of business. In
the case of credit unions formed among the employees of a single firm,
the employer often donates office space, including of course light and
heat. Taxes, office supplies, stationery, and insurance are the only
items of expense for a large proportion of the societies.
The record of these credit unions as regards bad debts is quite
remarkable. Even in the depression year of 1933, only 158 societies
had any uncollectible debts and these amounted to $66,663, which was
four-fifths of 1 percent of their loans during the year. Figured on
the basis of the loans of all societies reporting, the losses were less
than one-fourth of 1 percent.
Nearly $1,000,000 was returned to members in dividends on their
stock during 1933.
Fundamentals of Cooperative Credit
T he following are the principles upon which credit unions operate:
1. Membership open to persons of good character who have a com
munity of interest with the credit-union group.
2. Low membership fees, and shares of low denomination which
may be paid for in installments.
CREDIT AND BANKING SOCIETIES
51
3. Democracy in government, with officers and committees elected
by and responsible to the members.
4. One vote per member, irrespective of the number of shares held.
No proxies.
5. Loans to members only.
6. Loans to directors, officers, and committee members generally
prohibited.
7. Loans made only for productive purposes and urgent needs.1
8. Amount of loan based not on the member's investment in the
society but on his needs and character.
9. Loans at low rates of interest, and interest generally payable
only on unpaid balances.
10. Dividends payable on all fully paid shares of stock.
Source of Data
I
was made of the State officials charged with oversight
and examination of the credit societies, in those States in which the
law requires these societies to file annual reports. Data were secured
in this way for the societies in Florida, Georgia, Illinois, Indiana,
Iowa, Kansas, Kentucky, Maryland, Massachusetts, Michigan,
Minnesota, Montana, Missouri, Nebraska, New Jersey, New York,
North Carolina, Rhode Island, Texas, Utah, Virginia, West Virginia,
and Wisconsin. The laws require reports on only a few points,
however, and in order to obtain supplementary data, questionnaires
were sent to each of the individual societies in all of the States. Some
data were obtained for 1,772 of the 2,016 credit unions known to have
been in operation at the end of 1933.
n q u ir y
Number and Age of Credit Unions Reporting
A
number of questionnaires (292) were returned
with the notation that the society had gone out of business. As no
general questionnaire study has been made by the Bureau for credit
unions in all States since 1925, it was impossible to determine what
proportion of these had liquidated in the depression years and as a
result of the depression. A large percentage, however, had been
societies formed among the employees of individual firms. The
fortunes of credit societies of this kind are apt to stand or fall with
those of the employer firm. A number of returned questionnaires
indicated that the firm had liquidated, thus removing the “common
bond of interest" among the credit-union members specified by the
credit-union law as a prerequisite for the formation of the society and
making necessary the dissolution of the organization. In a few
the labor force of the firm had been so reduced as to decrease the
c o n s id e r a b l e
1 But this, in practice, is usually very liberally construed. Under some circumstances a loan might even
be granted to enable the borrower to take a much-needed vacation—such a purpose being considered both
necessary and productive.
52
COOPERATIVE MOVEMENT IN 19 3 3
membership of the society to a point below that at which operation
was considered advantageous.
Table 35 shows the number of credit unions in existence at the time
of each of the three previous studies of this branch of the cooperative
movement, and, for 1933, the total number in existence and the
number for which reports were received.
It is seen that the cooperative credit movement multiplied fivefold
between 1925 and 1933.
Massachusetts held first place in credit-union organization in each
of the years shown. It is evident, however, that with the passage
of enabling legislation from year to year and the active promotion by
several organizations of the formation of cooperative credit societies,
new States are beginning to challenge the credit-union supremacy of
Massachusetts. The most phenomenal growth in numbers has
occurred in Wisconsin. That State, in which the Bureau had record
of only 2 societies in 1925, at the end of 1933 ranked next to Massa
chusetts, far surpassing New York (another old credit-union State) in
point of number of societies. Other States in which the number of
credit unions has increased rapidly in the past few years are Illinois,
Iowa, Minnesota, and Missouri.
Table 35.—NUM BER OF COOPERATIVE CREDIT SOCIETIES AT END OF EACH YEAR,
1925, 1929, 1932, AND 1933
1925
State
Alabam a____
_
____
Arizona______________ ___ ____ _ ______ ___
3
Arkansas___________ ______________ ___
1
California------ ------------------- _ ___ __ _________
Colorado___________ _ _ _ _______ __ _ _ _
Connecticut._____ _ _ _ _________________ _
District of Columbia
_ _ _ ___
____
1
Florida_________________ _________ __ _________
3
Georgia-------------------------- _ ______ _______ ____
1
Illinois_______________ .__ ___ ___________ _
Indiana____ _
_
__
7
1
Iowa________ ______ _____ _
___________
1
Kansas_______________ __ _ _ __ ___________
2
Kentucky------- --------------------------------------------------2
Louisiana________ ___ _ _____ _ __ ___________
1
Maine_____________ __ __ ____ _ _ ___________
Maryland______________________________________
1
220
Massachusetts.._______ _______________________
Michigan_____ _________ _ ________ __ ______ _
2
1
Minnesota____ ________________ __ _ ______ __
Mississippi___________ ______ ___ _____ _ __
Missouri___________ ____ _ _ _________ __
Montana______
Nebraska_____________ _ _ _______________
1
New Hampshire__________________________ _____
4
New Jersey___________________________________ _
New Mexico____________ __
______
115
New York_________ _ __ _ ____ _____ _
26
North Carolina. ___
__ _ ______ __
Ohio.— _ _
2
Oklahoma____ ___ ___ __ __ ___ ___ _ _ _____
Oregon ___
1
Pennsylvania_________ _ _. _ _ ________ _ _
5
Rhode Island__________ _ ___ _ _ __________ __
2
South Carolina.__ __ _ __ .
_ ___ __ _ ______
3
Tennessee__________ ______ _____ ____________
3
Texas_________ ___ ________
_____ _ _ _
Utah .............
_ _____________
4
Virginia____________ ___ ___ _ ______ _ _ _ ___
2
Washington_________________________ _______
3
West Virginia_________ ________ ______________
1
Wisconsin______________________________ _______
419
Total__________ _____ ____________ ______
1929
39
2
3
19
2
1
1
1
39
41
32
36
10
10
6
2
3
299
29
43
43
1
7
3
11
125
46
3
3
3
2
13
5
15
12
5
30
6
9
14
974
1933
1932
Total Number
number reporting
40
38
18
2
2
2
12
11
6
51
61
40
6
9
8
3
3
3
7
12
16
6
9
9
44
64
64
108
130
130
67
85
49
85
125
109
21
25
23
24
32
32
8
12
9
3
3
12
8
12
285
282
282
40
49
40
101
152
145
4
5
2
122
132
132
3
3
2
36
42
42
8
8
4
20
27
26
1
1
1
113
135
130
69
65
56
22
32
15
5
14
85
4
6
5
23
9
16
13
13
4
4
2
35
54
31
38
47
43
8
10
8
33
40
28
11
5
9
10
14
12
131
209
201
1,612
2,016
1, 772
53
CREDIT AND BANKING SOCIETIES
Of the 1,035 societies for which data as to year of formation are
available, 239 (23 percent) were started in 1933, 525 (51 percent) were
formed from 1931 to 1933, and 821 (79 percent) from 1928 to 1933.
The details, by States, are shown in table 36.
T able
36.—DISTRIBUTION OF CREDIT SOCIETIES ACCORDING TO YEAR IN WHICH
ESTABLISHED
1900- 1911- 1916- 1921 1922 1923 1924 1925 1926 1927 1928 1929 1930 1931 1932 1933 Total
10 15 20
State
Alabama______ ..
Arizona___________
Arkansas _______ _
California________
Colorado______ _
Connecticut. __
District of Columbia
Florida___________
Georgia_______ _ ..
Illinois__________
Indiana___________
Iowa______________
Kansas. __________
Kentucky______ __
Louisiana._ . . ...
Maryland__ . __ _
Massachusetts_____
Michigan_________
Minnesota_________
Mississippi________
Missouri___________
Montana_________
Nebraska__________
New Hampshire___
New Jersey________
New M exico.._____
New York_________
North Carolina____
Ohio_______ ____ .
Oklahoma.. _____
Oregon____________
Pennsylvania______
Rhode Island______
South Carolina_____
Tennessee__ _____
Texas____________
Utah______________
Virginia____ _ __
Washington___ __
West Virginia______
Wisconsin________
Total______ .
11 4
2
1
3 5 6
1
5
1
2
1
1
10
5 7 4
1
1
1
3
13 6
2
1
1
5
2
1
1
6
3
1
1
3
1 3
2
1
3
2 4
1
1
2
14
21 15
2 1
1
1 1
3
1 2
2
25
3
3
9
11
1 3
1
1
1
2
1
5
13
5
6
2
2
16
5
8
8
2
1
4
7
3
2
4
3
4
3
1
3
14
8
2
4
3
5
5
9
1
1
3
2
1
3 . ...
1 1 1
1 2 1
6
1 2
4 "6
1
I
3 1
3 4
4
2 6~
1 1
1
2
2
2
1
2
13 31 52 46 112
88
5
2
2
1
5
14
3
6
2
5
8
4
3
2
1 1
2
14 4
1 4
3 8
6 5
1
1 9
3 7
1
12
2
3 1
2
1
1
1
11
2
1
5
1 1
4 1
5 10
3 2
2
3 7
1
1 7
10 14
7 11
16 17
3 4
7 4
2
2
5 4
3 1
18 30
1 1
16 17
1
4 3
1
5
4 8
4 3
7 3
6
1
1 6
1
12 11
5
2
1
4
1
18
2
6
39
7
3
12
6
27
68
49
64
14
20
9
7
117
25
80
2
662
20
4
22
1
66
20
15
8
5
9
6
2
31
27
7
189
9
41 47 113
96 102 184 239 1,035
6
11
The following statement shows the number of societies of clas
sified age:
Number of
societies
Under 1 year_______________________________
1 and under 3 years_______________________
3 and under 5 years_______________________
5 and under 10 years______________________
10 and under 15 years_____________________
15 and under 20 years_________________
20 and under 25 years_____________________
25 years and over__________________________
Total
218
297
180
265
45
23
6
1
1. 035
54
COOPERATIVE MOVEMENT IN 193 3
The average age, for all societies reporting, was just over 4 years.
The oldest societies which reported were St. Mary's Bank, Man
chester, N. H., started in 1908; Industrial Credit Union of Boston,
started November 23, 1910; St. Anne Credit Union of New Bed
ford, Mass., started August 3, 1911, and Shepard Stores Employees'
Credit Union, Boston, started January 1, 1912.
Membership
G enerally , in the cooperative movement, it is one of the first
essentials that membership shall be open to all. Due to the nature
of the credit business, however, this is not true in the cooperative
credit society. A considerable proportion of the credit union's
business cpnsists of character loans, made without any security except
the personal integrity of the borrower. Consequently, it is essential,
for the safety of the loans made, that the borrower's financial re
liability be known, and this is possible only in a group the members
of which are known to each other. Membership restrictions are
therefore almost universal in credit societies. Indeed, many of the
State laws authorizing the formation of credit unions impose such
restrictions. A common provision of credit-union laws is that the
membership shall be limited to a group having a common bond of
occupation or association, or to persons residing within a welldefined neighborhood, community, or rural district.
Table 37 shows the limitations on the membership imposed in the
1,016 societies reporting. It is seen that of this number there were
only 47 which had no requirement on this point. The largest group
was that of societies formed among the employees of individual com
panies, especially in the railroad and meat-packing undustries. The
next largest group was that of credit unions of public employees; in
this group societies of Federal employees (mainly in the Postal
Service) predominated.
CREDIT AND BANKING SOCIETIES
T able
55
37.—NUM BER OF CREDIT UNIONS WITH SPECIFIED LIMITATIONS ON
M EMBERSHIP
Membership limited to—
Employees of specified company:
Coal-mining companies------------------Hotels.------------------ ---------- --------Insurance companies------- ---------------Laundries-------------------------------------Loan companies___________________
Manufacturing companies:
Automobiles----------------------------Food products--------------------------Machinery.----------------------------- Metal products-------------------------Paper and/or paper products.---Rubber products. _--------------------Shoes--------------------------------------Textiles (including hosiery)-------Other products_________________
Product not known.. . --------------Motion-picture companies— ----------.
Oil companies----- --------------------------Printing and publishing companies:
Newspapers.-------- -------------------Other-------------------------------------Public utilities:
Gas, electric light, power.----------Railroads---------------------------------Street railways and busses---------Telephone and/or telegraph...---Railway-express companies-------------Slaughtering and meat-packing firms. _
Store companies:
Department stores........ ...................
Grocery stores______ ___________
Mail-order companies----------------Other.------------------------------------Other industries__________________ _
Others, business not known-------------T otal..--------------------------------Employees of specified organization:
Clubs_________________________
Colleges or universities.-------------Cooperative societies A ..------------Farmers’ organizations--------------Fraternal orders.„ --------------------Hospitals or sanatoriums.----------Other--------------------------------------Total------------------------------------Public employees:
Federal employees______________
State employees..---------------------County and municipal employees:
Firemen..----- --------------------Police---------------------------------
Num
ber of
credit
unions
1
5
7
2
3
5
21
10
9
2
9
7
21
13
1
3
17
9
36
71
11
15
5
77
7
2
3
2
7
81
470
2
4
11
16
4
3
3
43
245
3
16
3
Membership limited to—
Public employees—Continued.
County and municipal employees—
Continued.
Teachers and/or other school em
ployees............................................
Other......................... ........................
Various classes-------------------------------Total.
Specified occupation:
Building trades and clothing workers.
Dining-car employees----------------------Railway clerks._.--------Social-service workers------------Total.....................------------------------Members of specified labor organization:
Electrical workers________________
Federal employees-----------------------Fire fighters.._---------- ------------------Lithographers____________________
Masters, mates, and pilots________
Men’s clothing workers----------------Printing pressmen________________
Railroad-labor organizations----- ----Railroad trainmen-----------------------Railway clerks----------------------------State employees__________________
Teachers-------------------------------------Total---------------------------------Members of specified religious group
Specified nationality:
Finnish________
Italian_________
Portuguese_____
Total.
Residents of specified locality----------------Residents of specified locality who are
also—
Catholics_________________________
Farmers__________________________
French-Americans-------------------------Jews_____________________________
Veterans--------------------------------------Total.
No restrictions on membership.
Grand total.
1Includes members as well as employees in some cases.
Num
ber of
credit
unions
22
29
6
324
l
1
3
1
6
1
9
1
1
1
1
1
1
2
11
1
7
37
36
11
1
3
34
2
4
3
6
1
16
47
1,016
56
COOPERATIVE MOVEMENT IN 1933
The 1,673 societies for which the 1933 membership was reported
had an aggregate membership of 359,646, an average of 215 persons
per society. The Massachusetts organizations still retained supremacy
as regards combined membership, that State having more than 28
percent of the total number of members. New York came next, but
Illinois, a new credit-union State, has gained in importance from year
to year and ranked third among the States in point of membership.
The 3 oldest credit-union States are Massachusetts, New York, and
Rhode Island; these 3 States together accounted for 160,036 members,
or 44 percent of the total. By far the largest average membership
per society was found in Rhode Island. The average in that State
was over three times that of Oregon, which was next in line. The
details are shown, by States, in table 38.
T able 38.—AGGREGATE AND AVERAGE MEMBERSHIP OF CREDIT UNIONS, 1933, BY
STATES
State
Alabama______ ________
Arizona_______________
Arkansas______________
California.-- - ___
Colorado _________
Connecticut___ __ ___
District of Columbia____
Florida___ __________
Georgia.. _ ________...
Illinois_________ ______
Indiana_____ _________
Iowa__________________
Kansas___ __ ________
_
Kentucky________
Louisiana.. ______ _
Maryland __________
Massachusetts_______
Micair an_____________
Minafsota_____________
Missouri____________
Montana________ _____
Members
Num
ber of
Aver
soci
eties Total age
report num per
ber
ing
soci
ety
12
1
3
22
4
3
6
6
64
130
30
109
23
32
5
12
282
40
145
132
3
2,057
64
115
4,869
532
743
797
1, 213
8,150
32, 890
5,894
12, 245
3, 751
6,543
948
2,839
101,942
7,259
22, 334
19, 782
180
171
64
38
221
133
248
133
202
127
253
196
112
163
204
190
237
361
181
154
150
60
State
Members
Num
ber of
soci
Aver
eties Total age
report num per
ber soci
ing
ety
Nebraska____________
42 6,210
2
777
New Hampshire_______
New Jersey____________
22 6,035
1
N ew M exico..____ ...
57
New York.. .. _ ... ._ 130 50, 287
North Carolina______ _
56 3,166
Ohio_______ ____ __ _
15 3, 851
Oklahoma____ ________
758
8
Oregon___ __________
5 2,150
9
914
Pennsylvania__________
Rhode Island........ ..........
6 7,807
163
South Carolina_____
2
Tennessee . . . ___ __ ._
30 4, 979
Texas_________________
27 4,282
Utah_________________
7
931
Virginia... ____________
28 9,105
Washington____ ______
8 1,264
West Virginia__________
10 2, 293
Wisconsin___________
201 19, 470
Total____________ 1,673 359, 646
148
389
274
57
387
57
257
95
430
102
1, 301
82
166
159
133
325
158
229
97
215
Table 39 shows, for the 772 individual societies reporting their mem
bership, the number having each classified number of members.
Although small societies are considered desirable in the field of cooper
ative credit, there are a number of successful societies of considerable
size. The average membership (as shown in table 38) in 1933 was 215
members. Table 39 shows that 31 of the societies had 1,000 members
or more and 8 had 2,000 members or more. In general the largest
credit societies were found in the States with the longest credit-union
experience (such as Massachusetts, New York, and Rhode Island),
but it is of interest to see that Illinois, whose law was passed in 1925,
had 5 societies with 1,000 or more members.
57
CREDIT AND BANKING SOCIETIES
The four largest credit unions making individual reports were the
Central Falls (R. I.) Credit Union, with 3,586 members; the Chicago
Post Office Employees’ Credit Union, with 4,775; the Telephone
Workers’ Credit Union of Boston, with 7,851; and the New York
City Municipal Employees’ Credit Union, with 12,169.
T able 3 9 .—
NUM BER OF CREDIT UNIONS WITH EACH CLASSIFIED NUM BER OF
MEMBERS, 1933, BY STATES
Number of credit unions having specified number of members
State
A labam a.._______________
Arkansas___________ _______
California_________________
Colorado. .. ______________
Connecticut _____________
District of Columbia. ______
Florida______ _____________
Georgia__ _________________
Illinois________ ____________
Indiana___________ _______
Iowa____________ _________
Kansas_______ _____ _______
Kentucky. ________ ________
Louisiana_______ _________
Maryland __ __ ___
Massachusetts______________
Michigan__________ _____
Minnesota______ ______ ___
Missouri_______________ ___
Montana _ _______ __ _ __
Nebraska_______________ ..
New Hampshire _______
New Jersey _____ ________
New Mexico ______________
New York
__ . _
North Carolina ____ ________
Ohio ___________ ________
Oklahoma _ __ _________
Oregon _ _ ______________
Pennsylvania_____________ .
Rhode Island
_______
South Carolina. ___________
Tennessee____ ___________
Texas_____________________
Utah
_________________
V irginia.._________________
Washington _________ _____
West Virginia_______ ___ ___
Wisconsin _________ ____
Total--------------------------
25
50
Under and and
25 under under
50 100
100
and
under
250
250
and
under
500
4
1
1
4
1
1
4
12
3
1
3
2
7
21
7
9
4
3
2
21
8
27
14
1
1
9
4
3
5
1
1
4
2
1
13
6
3
5
2
4
25
235
3
2
1
2
6
5
7
1
1
1
1
1
1
3
1
2
1
2
1
1
3
1
9
28
2
1
2
3
8
1
12
3
1
2
3
8
8
4
1
4
1
1
5
1
21
6
2
1
1
2
29
115
2
5
10
13
7
3
2
4
20
5
16
13
4
5
1
2
2
5
11
4
1
4
3
3
33
189
20
16
8
1
4
6
4
1
2
1
2
7
1
6
10
115
500
and
under
750
750
and
under
1,000
1
1
4
1
2
2
3
1
2
8
4
3
1
1
1
1
2
I
2
1
3
2
2
1
1
1
1
3
46
1
2
13
1,000 2,000 Total
and and
under over
2,000
4
1
1
4
I
1
1
1
2
1
1
2
1
1
1
1
23
5
1
1
8
12
1
3
22
4
3
6
6
20
51
30
41
11
11
5
5
83
16
67
51
2
11
2
22
1
19
10
15
8
5
9
6
2
30
27
7
18
8
10
112
772
Resources
T he funds of credit societies are raised from among the member
ship. Each new member is required to pay an entrance fee, usually
ranging from 10 to 25 cents, and to subscribe for a certain amount of
share capital, usually one share.
The shares of stock are always of small denomination—usually
$5 or $10, but sometimes running as high as $25. The share, however,
can be paid for in installments ranging down to as little as 10 or 25
58
COOPERATIVE MOVEMENT IN 19 3 3
cents a week. Thus it is evident that, in ordinary times, few are
debarred by poverty from membership in the credit union.
Some societies place a limit on the amount of stock that may be held
by any one member, in order to insure a certain equality in interest
on the part of the members. A number of the State laws also con
tain provisions on this point. The 1,644 societies reporting their share
capital had a combined amount of more than $22,000,000. As table
40 shows, the average capital contributed per member ranged in the
various States from $12 in Oklahoma to $110 in Louisiana, and for
all States combined was $62.
T able
4 0.—AVERAGE PAID-IN SHARE CAPITAL PER M EM BER OF CREDIT UNIONS,
1933, BY STATES
State
Alabama_____________
Arizona_____________
Arkansas
California____________
Colorado __________
Connecticut _ . ____
District of Columbia___
Florida_________ ___
Georgia___________ ...
Illinois____________
Indiana_____ ________
Iowa.. ______________
Kansas----------------------Kentucky___________
Aver
age
capital
per
mem
ber 1
$51
74
35
64
23
97
28
92
57
47
39
35
33
56
State
Louisiana______ ______
Maryland____________
Massachusetts ___
Michigan_____________
Minnesota____________
M issouri.____________
Montana _________ _
Nebraska_____________
New H am pshire._____
New Jersey _________
New M exico_________
New York- _______ __
North Carolina______
Ohio........... ............ -_ -
Aver
age
capital
per
mem
ber 1
$110
38
66
38
37
56
45
24
63
42
58
103
34
41
State
Oklahoma. ______
Oregon__ _ ________
Pennsylvania,
Rhode Island __ ____
South Carolina _
Tennessee.— ______
Texas_____ _________
Utah_________________
Virginia______________
Washington
West Virginia. _ __
Wisconsin. _ _____ _
All States. ___
Aver
age
capital
per
mem
ber 1
$12
58
26
63
52
80
57
50
53
75
53
51
62
i Based on societies which reported both membership and capital.
The accumulated funds of the credit societies reporting in this
regard are shown in table 41. As the table shows, in addition to the
more than $22,000,000 in share capital, 1,442 societies reported
guaranty funds aggregating $2,372,711, an average of $1,645 per
society. Such funds are designed as reserves to cover possible losses
from defaulted loans and are required by the State laws to be estab
lished through regular appropriations (commonly 20 percent) from
the year’s earnings. Not all of the State laws permit credit unions
to accept savings deposits even from their members, but the 349
societies reporting such deposits had received the sum of $5,685,276
from 50,485 depositors, or an average of $113 each.
Total resources, available for 1,707 organizations, amounted to
$35,496,668, an average of $20,795 per society.
CEEDIT AND BANKING SOCIETIES
59
Table 4 1 —SHARE CAPITAL, RESERVES, DEPOSITS, AND TOTAL RESOURCES OF
CREDIT UNIONS IN 1933, BY STATES
Share capital
State
Guaranty fund
Deposits
Total resources
Num
Num
Num
Aver Num
ber of
ber of
ber of
ber of Num
socie
socie
socie ber of Amount age
per socie
Amount
ties Amount ties Amount ties deposi of
de ties
deposits posi
re
re
re
re
port
port
port
ceiv tors
tor 1 ing
ing
ing
ing
Alabama................... 18
Arizona........................ 2
Arkansas.....................
6
California............. ....... 40
Colorado...................... 7
Connecticut________ 3
District of Columbia. 11
Florida.........................
6
Georgia........................ 64
Illinois_____________ 130
Indiana........................ 48
Iowa...................... .
62
Kansas____________ 14
Kentucky.................. . 20
Louisiana__________
9
Maryland.................. . 12
Massachusetts........... 282
Michigan..................... 25
Minnesota................... 145
Mississippi..................
1
Missouri___________ 132
Montana ............. ..
2
Nebraska__________ 42
New Hampshire____ 4
New Jersey............... 26
1
New Mexico_______
New Y ork................. 130
North Carolina-------- 56
Ohio
15
Oklahoma _
7
Oregon
5
9
Pennsylvania______
Rhode Island.............. 6
South Carolina........... 2
Tennessee.................... 30
Texas.......................... 27
Utah............................. 7
Virginia-___________ 18
Washington................. 9
West Virginia............. 10
Wisconsin__________ 201
T otal............... 1,644
$125,372
8,368
4,613
689,852
91,072
72,070
38; 586
111, 127
465,708
1,544,374
403,490
294,462
81,293
267,467
153, 302
100,462
6,749,904
479, 557
828,819
2,218
1,115,600
6,727
151,322
99,089
245,193
3,303
5,190,478
106,281
156,282
8,466
125,479
24,008
488,472
8,517
395,132
245,267
46.677
326, 505
97, 073
121,909
983,965
22,457,861
4
472
16 $7,169
744
2
2
18
246
5
3
40
33 37,472 17 1,406
2,102
94
6
3
3
3,386 (2)
(2)
1,172
2
135
10
7,551
2
11
5
64 49,508 16 2,121
130 99,760
42 23,766 19 1,086
55 16, 555 16
426
4,769
12
132
17 17, 293
6
9 10, 222
12
8,487
1
1
282 885,720 52 18,412
354
25 26,403 15
145 49,149 45 3,718
6
1
1
39
132 51,641
1
186 (2)
(2)
42
9, 760
4 48,293
3 5,184
22 23, 627 18 4,890
1
102
130 727, 738 21 6,488
15 10, 557 56 1,341
14
5,439
482
6
5
5, 358
8
1, 019
6 88,461
3 1,164
2
1.110
1
1
25 26,674 15
222
24 11,518 10
140
7
2
60
2,216
18 47,461
8
947
9
5,221
2
9
10 11,501
6 1,574
87 42,867
1,442 2, 372, 711 349 50,485
$46,016
1,974
274
79,287
4,492
(2)
2,836
358
93,946
103,106
9,222
26, 700
4
2,499,732
31,987
403,948
364
(2)
1, 564, 762
211,419
301, 318
160,962
108,696
2
15,057
3,162
4,920
8,378
206
2,148
5,685,276
$97 15 $140,525
11,894
110
2
3,905
3
7
56 29 800,855
107,707
48
6
3
80,232
38, 065
18
7
33
6 135,009
44 64 712, 528
130 1,762,946
95 40 379,932
22 109 415,883
23 144,586
202 32 391,663
9 182,495
4 12 118,850
136 282 12,030,012
90 40 652, 449
109 145 1,365,227
9
2
6,778
132 1,112,843
3
6,681
42 291,128
302
3 1,967,421
43 26 283,102
1
3,451
46 130 6,913,821
120 56 325,927
11 165,206
7
12,960
4 133,064
5
18,567
93
6 1,965,300
2
2
13,802
68 28 438,897
23 43 352,649
82
6
61,137
9 28 609,052
23
6 100,601
1
8 145,446
201 1,094,072
113 1, 707 35,496,068
1 Based on societies reporting both deposits and number of depositors.
* No data.
In table 42 the associations are classified according to assets. It
is seen that the majority of the societies had limited resources; over
50 percent had assets of less than $5,000 and over 80 percent assets
of less than $25,000. Slightly under 5 percent had resources of
$100,000 or more. Here again, the Massachusetts credit-union
movement is outstanding:.
144224°—35-----5
COOPERATIVE MOVEMENT IN 193 3
60
T able
43.—NUM BER OF CREDIT UNIONS HAVING EACH CLASSIFIED AMOUNT OF
TOTAL ASSETS, 1933, BY STATES
Number of societies with assets of—
State
California__________
Connecticut- ______
District of Columbia.
Un $1,000 $5,000
der and and
$1,000 under under
$5,000 $10,000
3
2
2
1
3
4
8
5
19
2
1
1
2
3
3
14
15
1
6
1
4
2
2
4
1
Indiana__________ Iowa
__________
Transas
____
K entucky.________
Louisiana__________
Maryland. _________
M assachusetts.___
Michigan _ _ _____
Minnesota _ ______
Mississippi ________
Missouri. _________
Montana___________
Nebraska____ _ _
New H am pshire.__
New Jersey________
New Mexico _____
New York ____
North Carolina___
Ohio
. _____
Oklahoma.
____
Oregon _ _____
Pennsylvania______
Rhode Island___ _ _
South Carolina_____
5
Tennessee. ________
4
Texas______________
1
U ta h _____________
Virginia___________
3
Washington________
West Virginia_____
W isconsin _______ 34
Total _______ 156
6
1
13
3
1
3
10
25
15
17
6
7
4
2
19
7
32
2
20
4
11
1
3
7
2
2
1
2
1
17
5
2
3
5
42
301
3
2
1
2
1
2
9
9
9
2
1
1
14
5
12
9
1
1
3
7
2
2
1
2
2
2
5
1
3
12
126
Total
$10,000 $25,000 $50,000 $100,000 $500,000
report
and and under $1,000,000 ing
and and and
under under under under
and over
$25,000 $50,000 $100,000 $500,000 $1,000,000
1
2
6
2
1
5
8
8
9
4
3
1
31
6
6
6
3
5
19
2
4
1
1
7
1
7
2
1
5
156
2
1
3
2
1
1
1
1
3
8
3
4
2
6
2
1
1
2
1
1
46
4
1
1
1
1
6
2
2
3
10
3
2
1
1
8
2
1
2
1
1
2
1
1
1
59
2
1
1
12
2
1
2
2
1
1
1
8
1
2
2
1
1
1
36
2
4
15
2
3
29
6
3
7
6
26
58
40
57
14
16
9
7
100
23
71
2
58
2
17
3
20
1
56
15
11
7
4
5
6
2
28
23
6
18
6
8
96
886
Requirements and Procedure for Loans
O nly a m em ber of a credit union can be a borrower from it,2 and
even a m em ber cannot secure a loan if he has failed to repay any pre
vious loan or is in arrears on a current loan, or if his endorsers have
ever had to pay any of his obligations.
A member desiring to obtain a loan must make application in
writing, stating (1) the purpose for which he intends to use the money,
and (2) what security, if any, he can offer.
The loan, in most States, must have the unanimous approval of the
credit-committee members who are present at the meeting at which
the application is considered (and who must generally constitute at
least a majority of the committee). Many societies provide, however,
3 The District of Columbia law is unique in that it apparently permits loans to nonmembers. This is
permissive only and restriction against such loans can be sad doubtless is set qp by the societies by re»
strictive provisions on this point in their bylaws*
CREDIT AND BANKING SOCIETIES
61
that appeal may be taken from the committee’s decision to the board
of directors of the society.
It is the general practice of cooperative credit organizations to grant
loans only for provident or productive purposes, for purposes which
promise to be of benefit to the borrower, and for urgent needs; these
requirements, however, are construed very liberally. An analysis of
more than 4,000 credit-union loans showed that in the majority of
cases the money was borrowed to meet such family crises as illnesses,
surgical operations, the winter’s coal bill, insurance, and various bills.3
Behind the last-named reason lay many a moving story of a family
pursued by collectors or of wages attached for an accumulation of bills
which could not be met. The annals of credit-union loans are full of
stories of this kind. The applicant lays his case before the credit
committee, which through practice becomes adept at dealing with such
situations. It examines his situation, determines the size of the loan
necessary to cover the total, and may even be able to induce some of
his creditors to make a sizable reduction in consideration of lump-sum
payment. It will then assist him to budget his income to cover his
various expenses. His mind relieved of financial worry, the borrow
er’s value to both his employer and his family improves. The regu
lar setting aside of the sums necessary to repay the credit union es
tablishes the habit of thrift, which he is encouraged to continue—in
the form of savings deposits—after his loan is repaid.
Practice in regard to security for loans varies. A small number of
societies have the rule that no loans may be made without security.
Generally, however, character loans may be made in amounts up to
$50 without any security except the committee’s knowledge of the
borrower’s reliability. For greater amounts security must be pro
vided, but that security may be the endorsement of one or more
fellow members and/or the pledging of the borrower’s share capital.
In Illinois and Maryland the credit-union law specifically prohibits
the making of mortgage loans on real estate, but the Utah act requires
that for all loans of $500 or more approved securities or real estate
valued at twice the amount of the loan must be pledged.
Some of the State laws limit the size of loans that may be made by
cooperative credit societies. The lowest limit is that set by the
Louisiana and New Jersey laws ($500), but other laws are more
liberal, ranging up to $8,000 (mortgage loans) in Massachusetts.
Business Done (Loans Granted) During 1933
D u r i n g 1933, as table 43 shows, the loans granted amounted to
$28,217,457, and the borrowers numbered 206,295. This was an
average of $138 per loan—an amount well within the maximum
allowed even by the least liberal law.
• See Monthly Labor Review, July 1927, p, 8,
62
COOPERATIVE MOVEMENT IN 19 3 3
As would be expected, the greatest amount of business was done by
the Massachusetts associations; their loans accounted for 37 per
cent of the total. It is interesting to see that although New York
was second in amount of loans, the Illinois societies were very active
and loaned more than $2,000,000 during 1933. The largest average
loans were made in Arizona, New Hampshire, and New York.
More than $26,000,000 was still outstanding at the end of the year.
Table 4 3 .—LOANS GRANTED BY CREDIT UNIONS DURING 1933, AVERAGE AMOUNT OF
LOAN, AND TOTAL LOANS OUTSTANDING AT END OF YEAR
State
Alabama________________________________
Arizona_________________________________
Arkansas_________________ _____________
California_______________________________
Colorado____________________________ ___
Connecticut_____________________________
District of Columbia.____________________
Florida______ _____ _____________________
Georgia_________ ____ ________________
Illinois__________
___________________
Indiana_____ __________________________
Iowa_________________ _______ _________
Kansas_______________________ _________
Kentucky_________________ _____________
Louisiana______ _ _____ ______________
Maryland____________ ___ ______________
Massachusetts___ ___ _ ______________ _
M ichigan.___________________ ____ ______
Minnesota________________ ____ _____
Mississippi______________________________
Missouri_____________________ ______ ___
Montana____________________________ ___
Nebraska_____ _______________ ___ ___ _
New Hampshire..____ _ . ... _ . _______
New Jersey________ ___ ___ ____ ______
New Mexico___________ ___ _______- New Y ork_____________ ______ _______
North Carolina________ __________ _____ _
Ohio____________________________ ______
Oklahoma_______ .. ________________ ..
Oregon __________ _____________ ____
Pennsylvania_____ . __________________
Rhode Island____________________________
South Carolina__________________________
Tennessee______________________________
Texas__________________________ _______
U ta h ________ __________________________
Virginia_______ _____ ___________________
Washington_____________________________
West Virginia _ ______________________
W isconsin_______________ _____________
Total ____________________ ______—
Loans granted during
year
Number Number of
Loans out
of socie borrowers
standing
ties re in 1933
end of
Average at year
porting
Amount loan per
borrower 1
18
2
6
39
6
3
10
6
64
69
47
109
23
19
9
12
282
23
80
2
132
2
42
4
26
1
130
56
15
8
5
9
13
2
31
43
7
28
9
10
201
1,603
3,003
75
156
9, 098
937
5,679
946
951
5,484
22,722
6, 231
5, 779
1,983
4,227
2,180
1, 577
51,440
5, 416
9,836
110
8.303
67
2,766
964
3,649
64
19,189
1,407
2,515
168
1,309
495
2,900
140
3,972
4,072
720
5,746
969
2,565
6,485
206,295
$210,310
14,434
8,873
1,135,828
149,619
236,975
76,902
104, 514
515,113
2, 058, 562
426, 270
453, 790
181,462
522,438
322, 981
128,493
10, 555, 848
563,835
1,092, 925
7,920
825, 345
8,097
470,639
104, 275
239, 576
7,377
4,366,440
131, 621
221,481
18,412
167, 561
35,134
453, 797
14, 828
339, 791
330,979
112,476
555,067
140, 719
215,173
691, 577
28, 217,457
$70
$124,823
192
8, 693
3,216
57
753,472
125
98, 256
160
42
67,068
35,121
81
118, 845
110
93
537, 577
91 1,175, 279
259, 488
69
322, 022
79
121, 741
92
124
309, 908
163, 542
148
81
83, 601
205 8, 862, 586
476, 774
104
802, 954
111
72
5, 841
950,158
105
6, 729
127
239, 314
83
225 1,425,957
119,188
67
3,434
115
228 4,461,872
253,693
94
161,653
90
10, 002
110
128, 594
128
22,141
71
155 1,749,910
9,948
130
87
436, 206
322,793
88
62,908
156
559,331
130
151
81,449
84
131,338
924, 258
108
138 26, 391,683
1 Based on societies reporting both amount of loans and number of borrowers.
The business of the majority of the societies is small, over 60 per
cent having made total loans of less than $10,000 and nearly 80 per
cent of less than $25,000 during 1933. The number of societies
63
CKEDIT AND BANKING SOCIETIES
making each classified amount of loans during the year is given in
table 44. As the table shows, 3 societies did a business of $500,000
or over. These societies and the amount of loans granted were as
follows: Chicago Post Office Employees’ Credit Union, $599,682;
Telephone Workers’ Credit Union of Boston, $885,748; and New
York Municipal Employees’ Credit Union, $1,315,995.
Table 44.—NUM BER OF SOCIETIES MAKING EACH CLASSIFIED AMOUNT OF LOANS
IN 1933, BY STATES
Number of societies which made loans in 1933 aggregating—
State
Total
societies
$25,000
$10,000
$100,000
$1,000
$5,000
$500,000
$50,000
report
Un and and and 1 and and
and $1,000,000
and
ing
der
and
under under under under under under
$1,000 under
$5,000 $10,000 $25,000 $50,000 $100,000 $500,000 $1,000,000 over
3
Alabama _______
Arizona___________
Arkansas___________ 3
4
California_________
2
Colorado___________
Connecticut________
District of Columbia. 3
Florida.. ________
7
Georgia____________
Illinois_____________ 11
Indiana____________ 10
Iow a_____________ 17
2
Kansas — __________
Kentucky ________
3
Louisiana
1
Maryland ________
M assachusetts_____
5
4
Michigan _______
M innesota.._____ 17
Mississippi_______
Missouri___________
9
Montana _ _ __
Nebraska __ _ _ __ 5
1
New Hampshire __
1
New Jersey _ ___
New Mexico_______
New York . ______
3
3
North Carolina __
3
Ohio__________ ____
5
Oklahoma______ ___
Oregon. ___________
1
Pennsylvania. ______
Rhode Island_______
South Carolina... __
4
Tennessee__________
5
Texas ________ __
Utah ________
Virginia____________
3
Washington________
1
West Virginia______
Wisconsin__________ 26
Total.................. 162
6
1
3
10
2
3
1
6
20
16
20
4
6
4
1
16
7
27
2
19
7
8
5
8
3
1
2
4
14
1
2
4
2
5
50
290
2
7
1
1
3
13
7
10
2
1
2
17
5
12
7
1
4
1
8
1
1
2
4
1
6
6
3
3
1
1
17
150
3
1
8
2
4
2
2
12
8
8
4
4
3
1
26
3
13
8
4
1
5
15
4
5
1
1
1
9
3
1
7
169
4
4
2
5
3
3
4
1
1
2
17
2
8
3
1
2
12
1
1
2
1
2
4
2
5
1
1
2
96
1
4
5
1
5
1
1
3
1
1
1
8
1
2
2
1
1
10
1
i
1
1
3
1
17
2
2
3
1
1
1
1
45
1
1
1
53
1
9
2
1
2
1
18
2
6
39
6
3
10
6
27
68
45
59
13
19
9
7
107
23
80
2
51
1
19
3
21
1
63
17
14
8
5
9
6
1
29
25
7
17
8
10
104
968
Interest Charged on Loans
T he great majority of the State credit-union laws fix the maximum
rate of interest that may be charged on loans. Although this rate
64
COOPERATIVE M O V E M E N T I N 1 9 3 3
varies, the rate most commonly set is 1 percent per month computed
on the unpaid balance.4
The statement below shows, for the 1,010 organizations which
reported on this point, the rate actually charged per month or per
year.
..
Number of
Rate per year—Continued. satieties°
Rate. per month:
societies
6% percent_____________
1
y<i of 1 percent__________
2
% of 1 percent__________
2
1
6.75 percent____________
7 percent_______________ 24
8
% of 1 percent__________
7.2 percent_____________
1
% of 1 percent__________
1
% of 1 percent__________
2
8 percent_______________ 60
1 percent_______________ 478
9 percent_______________
5
Rate per year:
9.6 percent_____________
1
10 percent______________ 10
4 percent_______________
2
12 percent______________ 146
5 percent_______________ 14
5.5 percent_____________
9 Rate varies according to type
1 of loan___________________ 29
5.85 percent____________
5.9 percent_____________
3
Total________________ 1,010
6 percent_______________ 210
Operating Expenses
T able 45 shows for the 279 credit unions which furnished state
ments, the rate of operating expenses, calculated in percent of total
loans granted during the year.
Table 45.—OPERATING EXPENSES OF CREDIT UNIONS DURING 1933
Operating expenses,
1933
Item
Amount
spent for
specified
item
Salaries_______________________ ___ __________ $142, 311. 05
Stationery and supplies_______________________ 24,632. 38
9,789. 93
Rent________________________________________
1,190. 67
Heat, light, and power______ _________ _____
Insurance, taxes, and fees for State auditing____ 12,402.97
Premium on employees’ bonds._______________
1, 326. 31
6,235. 96
Interest on borrowed money__________________
113.13
Repairs_______________________ _____________
2,772.80
Depreciation______ __________ ______________
106. 09
Bad debts_______________ ____
_________
Miscellaneous___________
. . . __ __ 35, 255. 38
Total__________________________________ 236,136.67
Percent
of loans
granted,
1933
1.33
.23
.09
.01
.12
.01
.06
0).03
0)
.33
2. 21
1 Less than Moo of 1 percent.
4 Thus, in North Carolina the legal rate may be charged and in New Hampshire not to exceed the legal
rate. In Pennsylvania the interest rate may not exceed 6 percent per year, in South Carolina 7 percent,
in Indiana 8 percent per year “not collectible in advance", in Texas 10 percent, and in Utah 12 percent.
In 21 States the rate may not exceed 1 percent and in West Virginia and Virginia 1M percent per month,
computed on unpaid balances. The New Jersey law also provides that “no charges, bonus, fees, expenses,
or demands of any nature whatsoever other than as above provided shall be made upon loans or advance
ments except upon the actual foreclosure of the security or upon the entry of judgment." In New York
the interest may not exceed 1 percent per month, or 5.9 percent per year if deducted in advance, and in
either case must be inclusive of all charges incident to the making of such loan; if the member pays off a
loan before due, “ the pro rata unearned portion of interest shall be refunded." The Wisconsin statute
provides that a rate of 1 percent per month on unpaid balances “ shall not be held to be usurious ”
65
CREDIT1 AND BANKING SOCIETIES
Of the 1,038 societies which reported on this point, only 158
had any losses due to failure of borrowers to repay their loans.
The combined losses of these societies amounted to $66,663, which
was only 0.81 percent of their loans during the year. On the basis of
the loans of all the societies reporting, these losses amounted to only
0.24 percent.
Some 248 societies had sustained losses through bad loans at some
time during their entire existence (which averaged, for the societies
reporting, 4.1 years); the amount of loss aggregated $342,174.
Table 46 shows the losses, by States.
Table 46.—NUM BER OF CREDIT UNIONS SUSTAINING LOSSES DURING 1933 OR DUR
ING WHOLE PERIOD OF EXISTENCE, AND AMOUNT AND PERCENT OF LOSS
State
Num
ber of
soci
eties
report
ing
Alabama.. __
_____ _______
18
Arizona _______ __ _____________
2
Arkansas_______ . ___________
6
California____ ________________ _
40
7
Colorado_____ _ __ ____________ 3
Connecticut_____________ _______
12
District of Columbia-- ____ - ____
Florida_______ ____ _ _ _ _____
6
Georgia_______ _
__________
27
Illinois _______ _________
69
Indiana____ _____ _ ________ _ _
49
64
Iowa____
Kansas_________ __________ ___
14
Kentucky___________ ____ _____
20
Louisiana__ __
_________
9
Maryland.. _
____
7
Massachusetts.. _ _____
117
Michigan.. _ ______ ________ _
25
Minnesota. _ __
_____
80
Mississippi______ __ ___ _____
2
Missouri__ _ ______ ____________
66
2
Montana______________ _____ __
Nebraska_______
____
20
New Hampshire____ ______
4
New Jersey___________________
22
1
New Mexico_____ . ____________
New York—_ _________ ________ ...
66
North Carolina______ _________
20
Ohio__________
_
15
Oklahoma____ _____ _________
8
Oregon.. ... _ . . . . .
__ __ ...
5
Pennsylvania. _____ _ _ ____ _ .
9
Rhode Island____ __ . __
6
South Carolina_______ . . . . ___ _
2
Tennessee_______ ... _ _________
31
Texas______ ___
27
Utah__________ .
______
7
Virginia. _______ __ ... _ _ ___
18
Washington_________ ________ ...
9
West Virginia__ . .. . . . ____
10
Wisconsin_________ _________...
113
Total . . . ____ ____________ 1,038
1 Less than }ioo of 1 percent.
During 1933
During whole
perod of
operation
Num
Percent Percent
ber of
of 1933 of 1933
soci Amount loans of loans
of
eties of loss societies all socie
having
having
ties
losses
losses
Num
ber of
soci Amount
eties of loss
having
losses
3
$176
0.88
0.08
6
489
.25
.04
1
4
13
3
9
1
5
2
3
36
4
13
8
3
1
3
15
1
1
1
1
4
5
1
6
2
3
158
87
46
994
238
959
21
313
45
169
19,628
8,038
728
880
349
55
109
30,152
3
447
13
69
182
794
43
922
86
628
66,663
.35
.05
.25
.30
.89
.08
.10
.06
.33
.54
1.80
.14
.37
.39
.06
.24
3.97
.01
.46
.24
.13
.09
1.09
1.16
.26
.16
.62
.81
.11
.01
.05
.06
. 24
.02
.06
.01
. 16
.30
1. 43
.07
.11
. 15
.05
.04
.69
0)
.27
.04
.02
.05
.24
.04
.17
.04
.09
.24
4
2
9
1
2
3
9
13
8
13
2
8
3
3
46
8
19
15
3
1
8
28
i
2
1
2
7
9
1
9
1
4
3
248
$641
263
2,597
20
111
82
841
2,264
1,008
2, 220
42
1,826
813
525
144,160
15, 283
2,130
2, 279
349
119
1,889
148,468
3
631
13
2,949
447
1,314
43
6,674
198
1,058
914
342,174
66
COOPERATIVE M O V E M E N T IN 1 9 3 3
Interest Paid on Deposits
of interest paid by the societies on
T he rate
the savings deposits
of their members is shown, for 402 societies, in the following statement:
Number of
societies
1
^ of 1 percent ________________
/ 2 of 1 percent, on monthly balance_ _
__ ___________ _____
1
________________
4
2 percent
2y2 percent _
____________ 7
________________
64
3 percent__
_________________ 17
3)4 percent _
_________________ 144
4 percent
4% percent
_________________
9
5 percent
_________________ 70
Number of
societies
W/l percent______________________
6 percent________________________
6.6 percent______________________
7 percent________________________
7.2 percent______________________
8 percent________________________
9 percent________________________
12 percent_______________________
1
59
1
14
3
4
1
2
Total______________________ 402
Dividends
A fter the expenses are paid and provision is m ade for reserves,
etc., the remainder of the surplus on the year's operations is divided
am ong the m em bers in proportion to the stock held by them .
Table 47 shows the dividends returned on the 1933 operations in
the various States.
Of the 1,059 societies reporting on this point, 590 paid dividends
on the 1933 business, the amount so returned being $999,293. Al
though this is an interesting detail, the failure or success of these
societies must be judged not in terms of dividends, but on their
ability to provide credit for their members at low rates. That is
their objective and the society which has accomplished it has achieved
its main purpose. As already shown, the rates of interest are
generally moderate. The greatest benefit of these organizations lies
not in the returns made to depositors and stockholders but in the
savings effected for the borrowers through the low interest rates and
in the benefit, which cannot be evaluated, growing out of the relief
of the exploited borrower and the lifting of the burden of anxiety
from his shoulders.
Supplementary benefits are the encouragement of thrift on the part
of members, their gradual training in the budgeting of their finances,
and (for committee members and officers) training in the handling of
large sums of money.
67
CREDIT AND BANKING SOCIETIES
T able 47.—DIVIDENDS PAID BY CREDIT SOCIETIES ON 1933 BUSINESS, BY STATES
Number
of socie
ties re
porting
State
Alabama____________
Arizona_____________
Arkansas_______ ____
California_________ Colorado________ ___
Connecticut_________
District of Columbia. _
Florida_____________
Georgia___________
Illinois_____________
Indiana_____________
Iowa_______________
Kansas_____________
K>vntnr‘lry
Louisiana___________
Maryland___________
Massachusetts_______
Michigan_________ _
Minnesota__________
lTV/f
v i iico od ici oc oi nl pnpi i « - »- - - - ——
Missouri____________
Montana-...................
16
2
6
33
7
3
12
6
24
130
34
41
23
14
6
4
282
23
581
46
1
1
Number
which Amount
paid
paid
divi
dends
State
152 $8,499 Nebraska___________
552 New Mexico_______
3
239 New Hampshire___
30 34,270 New Jersey_________
4
5,105 New York__________
3
4,439 North Carolina_____
1,236 Ohio...................... ........
3
5
7,668 Oklahoma
i 20 20,092 Oregon_________ ____
73,646 Pennsylvania_______
(*)
34 12,176 Rhode Island_______
41 13,907 South Carolina....... .....
3,856 Term a r k a a _ .....................
(2)
14 15,644 Texas______________
9,789 Utah...............................
6
4
3,551 Virginia_______ _____
266,578 Washington_________
(2)
16 25,389 West Virginia._____
3 57i 30,897 Wisconsin__________
200
46 33,957
Total_________
642
1
Number
of socie
ties re
porting
Number
which Amount
paid
divi paid
dends
13
1
3
17
56
12
11
2
4
3
6
1
21
22
6
17
7
7
78
1,059
13 $3,562
1
100
3 79,448
17
4,585
56 187, 268
12
2,176
11
8,149
2
416
4
3,278
3
609
6 26,612
1
543
3 20 25,447
4 21 14, 068
6
2,951
17 21,085
7
5,978
7
8,423
78 32, 263
590 999, 293
1 Not including 1 which paid 10 percent but did not report amount.
1 Not reported.
3 Not including 1 which paid 6 percent but did not report amount.
4 Not including 1 which paid 17 percent but did not report amount.
Development of CreditUnion Movement Since 1925
T a b l e 48 traces the developm ent of the cooperative credit m ove
m ent from 1925 to 1933.
Table 4 8 —DEVELOPM ENT OF CREDIT-UNION MOVEMENT IN SPECIFIED YEARS,
1925-33
Item
1925
1929
1932
Total number of societies____ ______ ____
419
974
1, 612
838
1,472
Number reported for-----------------------------------176
Membership:
264,908
301,119
T otal.._______ ______________________
107,779
612
320
216
Average per society.-----------------------------Share capital:
Amount------------ ----------------------------------- $10,706,099 $24,065,407 $21,708,328
$92
$99
Average per member------------------------------$70
$2,079,450 $2,110,815
Guaranty funds.......................................................
0)
Loans during year:
Total amount............................ .......... ............ $20,100,356 $24, 548,353 $16,375,952
Average per society................. ........................
$116,187
$58,310
$16,475
$381
$350
$156
Average per loan.......................................... .
Loans outstanding at end of year------------------- $13,390,423 $30,811, 582 $24,826, 291
* No data.
Labor Banks
1933
2,016
1,772
359,646
215
$22,457, 861
$62
$2,372,711
$28, 217,457
$22,811
$138
$26, 391,683
O n December 31, 1933, there were still four banks operating under
labor union auspices in the United States. These had combined
resources of over $18,000,000. The capital, surplus, deposits, and
total resources of these banks are shown in table 49. The data were
supplied to the Bureau of Labor Statistics by Prof. J. Douglas Brown
of Princeton University.
68
COOPERATIVE MOVEMENT IN 193 3
Table 4 9 .— CONDITION OF LABOR BANKS, AS OF DEC. 31, 1933
Bank
Surplus
undivided
profits
$200,000 $133,058
375.000
177,428
650.000
0)
500.000
125,935
436,421
1,725,000
3 As of Jan. 13, 1934.
Capital
Amalgamated Trust & Savings Bank, Chicago, 111____
Union National Bank, Newark, N. J_____ ___ ______
Amalgamated Bank of New York, New York, N. Y ...
Telegraphers’ National Bank, St. Louis, M o .................
Total
_________________________________
1 No data.
Deposits Resources
$2,357,331 $2,759,379
2,298,216 3,406,891
3 4,832,884 3 5, 506,616
5,850,074 6,980,469
15,338, 505 18,653,355
At the peak of the labor-bank movement, in 1925, when there were
37 trade-union banks in operation, a rather wide variety of labor
groups was represented in this field. The Brotherhood of Locomotive
Engineers, which had started the movement with the opening of its
bank in Cleveland in 1920, was by 1925 financially interested in a
dozen banks. Other interested railroad labor-groups, each of which
had opened one bank, were the Order of Railroad Telegraphers,
Brotherhood of Railway Clerks, all the “Big Four” transportation
brotherhoods combined, and various railroad-labor groups combined.
Of the unions in the clothing industry, the Amalgamated Clothing
Workers had 3 banks, and all the needle-trades unions in New York
City 1 bank. The printing trades were represented by the bank in
which the International Printing Pressmen’s Union held an interest,
and the glass industry by the bank of the American Flint Glass
Workers’ Union. One bank was owned by a city central labor union
and building-trades council, one by railroad-labor groups and farmers,
one by a number of American Federation of Labor groups, and
one by the Machinists’ International Union. In establishing 11 banks
various labor groups had acted jointly.
In 1925 there were labor banks in 19 States and the District of
Columbia.
The status of the labor-bank movement each year since 1920 when
the first such bank was opened is shown in table 50.
Table 50.—DEVELOPMENT OF LABOR BANKS IN THE UNITED STATES, 1920 TO 1933 i
Date
Num
and
cap Surplus
ber of Share
undivided Deposits
ital
banks
profits
Total re
sources
Dec. 31—
2 $960,000 $194,446 $2,258, 561 $3,628,867
1920_________________________________
255,869
9,970,961 12,782,173
1921_________________________________
4 1,280,000
10 2,050,473
742,689 21,901,641 26,506,723
1922________________________________ 1923_________________________________
18 4,222,230 1,353,022 43,324,820 51,496, 524
1924_________________________________
26 6,441,267 1,891,757 72,913,180 85,325,884
1925 3________________________________
36 9,009,072 3,467,829 98,392, 592 115,015,273
35 8,914,508 3,837,377 108,743, 550 126, 533, 542
1926.--------- ---------------------------------------32 8, 282, 500 3,747,176 103,290, 219 119,818, 416
1927_________________________________
27 7,537,500 3,821,205 98,784,369 116, 307, 256
1928__________________________ ______
June 30—
22 6,687,500 3,807, 579 92,077,098 108, 539,894
1929----------------- ------------------------ -------14 4,112,500 3,105,336 59,817,392 68,953,855
1930_________________________________
11 3,912,500 2,952,878 50,949, 570 59,401,164
1931------ -------------------------------------------851,041 19,727,606 26,305,877
6 2,425,000
1932 3________________________________
4 1,725,000
443,908 14,728,079 18,186,216
1933___________________________ _____
1 Data are from Princeton University, Industrial Relations Section, Report on Labor Banking Move
ment in the United States, Princeton, 1929, p. 277, and additional new material furnished by the university
to the Bureau of Labor Statistics.
3 Amalgamated Bank of Philadelphia not included.
3 Dec. 31.
69
CREDIT AND BANKING SOCIETIES
Mutual Savings Banks
M
savings banks, like the building and loan associations, may
be considered as cooperative to some extent. The encyclopedia defines
them as follows: “A savings bank is a mutual institution conducted
for the benefit of the depositors, without profit to the managers or
trustees, for the purpose of receiving on deposit, for safekeeping and
investment, such sums as shall be offered by the depositors, repaying
the principal on demand or upon legal notice, and distributing the
earnings among the depositors as interest-dividends, after paying
expenses, and setting the remainder aside as a surplus fund for the
protection of all.” 5
The control of a mutual savings bank is in the hands of a board of
trustees named in the original articles of incorporation. This board
is self-perpetuating. As a rule its members serve without any com
pensation whatever, even for attendance at meetings.
A mutual savings bank is a nonstock association, being owned by
the depositors collectively. “The depositors are, in a sense, partners,
in that the profits belong to them and the losses, if any, are legally
assessable upon them, the latter process being, however, a rare
occurrence.” 5
Table 51 shows, by States, data for mutual savings banks in the
United States on June 30, 1933.
utual
Table 51.—STATUS OF MUTUAL SAVINGS BANKS AS OF JUNE 30, 1934
State
Num Number
ber of of de
banks positors
California
___
Connecticut-------Delaware________
Indiana_______ _
Maine__________
Maryland_______
Massachusetts___
M innesota_____
New Hampshire __
New Jersey_____
Amount of
deposits
1
70,495 $87,573,000
73 962, 665 661.173.000
2
49, 200
28.738.000
17.864.000
27,489
5
33 229, 410 118.350.000
13 i 343, 749 195, 018,000
193 2, 834, 457 2, 045,087,000
95, 612
60.157.000
1
48 280,846 182.814.000
25 488,867 308.860.000
State
Num Number
ber of of de
banks positors
Amount of
deposits
New York_______ 138 6,463,196 $5,139,593,000
Ohio____________ 3 161,948 108.389.000
Oregon _ . .......... 1
266
71,000
Pennsylvania____ 8 644,922 512.109.000
Rhode Island____
9 188,088 169.543.000
Vermont. ________ 19 116,117
75.324.000
99,134
Washington_____
3
49.169.000
Wisconsin. ............. 3
20,650
4,220,000
Total______ 578 13,077, 111 9,764,052,000
i As of Dec. 30, 1933.
The development of the mutual savings banks since 1920 is shown
in table 52:
« The Americana, 1927, vol. Ill, p. 189.
70
COOPERATIVE MOVEMENT IN 19 3 3
Table 52.—DEVELOPM ENT OF MUTUAL SAVINGS BANKS IN THE UNITED STATES,
1920 TO 1934
Deposit:5
Number
of banks
Year
1920_______ _________________________________
1921________________________________________
1922......................................... ......................................
1923...._______ ___________ _________________
1924_____________ __________ ______________ _
1925______________________ ____ _____________
1926______________________ ________ _____ _
1927__________ ____ __________________________
1928_________________ _____ _________________
1929---------------------- --------------------------------------1930..........-_____ ___________________________ 1931_______________________ ____ ____________
1932------- ------------------ ---------------- -----------------1933________________________________________
1934...----------------------- ----------------------------------
620
623
619
618
613
611
620
618
616
611
606
600
594
576
578
Number of
depositors
9,445,327
9,619, 260
9,655,861
10,057,436
10,409, 776
10,616,215
11,053,886
11,337, 398
11,732,143
11,748,085
11,895,075
12,356,114
12,521, 750
12, 683, 788
13,077, 111
Amount
$5,186, 952,000
5,575,147,000
5, 779, 506,000
6,288, 551, 000
6, 693, 246,000
7,146,951,000
7,577, 504,000
8,077,099,000
8, 672,823,000
9,001,599,000
9,190,969,000
10,017,225,000
10,021,852,000
9,699, 509,000
9,764,596,000
Average
per de
positor
$549
580
599
625
643
673
686
712
739
766
773
811
800
765
747
Building and Loan Associations
B uilding and loan associations, like the mutual savings banks,
have certain cooperative features. Statistics for these organiza
tions, compiled from data furnished annually to the Bureau of Labor
Statistics by the United States Building and Loan League, are
shown below.
Table 53 shows the status of these associations as of December
31, 1933.
Table 5 3 —MEMBERSHIP AND ASSETS OF BUILDING AND LOAN ASSOCIATIONS
AT END OF 1933, BY STATES
State
Num
ber of Number
asso
of
Total assets
cia members
tions
Alabama.................... 39
2
Arizona------- --------55
Arkansas.............. .
California................. 182
52
Colorado....................
Connecticut............... 44
43
Delaware_________
District of Columbia. 28
59
Florida.....................
40
Georgia......................
Hawaii........................ 11
Idaho.......................... 14
Illinois............. ......... 889
Indiana.................... . 380
Iowa............................ 74
Kansas..... ................. 150
Kentucky.................. 164
Louisiana................... 99
Maine......................... 36
Maryland 1------------ 1,000
Massachusetts.......... 227
Michigan............... — 65
Minnesota................. 75
44
Mississippi................
Missouri..................... 233
Montana__________ 27
i Figures estimated.
33,480
1,600
30,213
350.000
50,000
31,534
19,430
96,785
10,370
18,443
28,012
9,550
782.300
341,700
60,072
155,152
170.300
166,241
25,930
283.000
436,920
185,267
96,179
6,274
207,950
25,800
$23,843,533
600,000
25, 794,298
359,894,896
35,340,471
25, 607,678
15,257,369
90,533,000
13,129,227
6,891,548
5,288,989
6,272,313
394,648,000
246,333,779
41,789,377
106,960,685
110,937,465
143,656,771
23,967,428
185,000,000
502,873,869
142,693,028
39,038,245
10,943,600
169,255,761
15,026,454
State
Num
ber of Number
asso
of
Total assets
cia members
tions
Nebraska................. . 83
Nevada......................
5
New Hampshire___
29
New Jersey 1______ 1,532
New Mexico.............
16
New York________ 293
North Carolina____ 209
22
North Dakota_____
Ohio.. ...................... 737
Oklahoma..... ........... 90
22
Oregon-----------------Pennsylvania______ 2,908
Rhode Island..........
8
South Carolina 1___
98
South Dakota_____
20
42
Tennessee_________
T exas................... . 139
21
Utah.........................
14
Vermont__________
Virginia___________ 89
Washington_____ _ 66
West Virginia........... 60
Wisconsin....... .......... 184
8
Wyoming...................
Total, 1933.... 10, 727
176,500 $111,876,652
2, 281 1,246,345
16,152 13,761,730
970.000 1,050,000,000
4,500 4,316,562
481,928 394,643,465
74,182 68,439,937
22,251 12,054,641
1,968,129 895,028,774
129,339 99,238,441
31,400 18,228,564
884,065 957,791,288
47,898 33,691,232
18,000 20,000,000
9, 650 5,844,910
25, 640 18,993,047
137,700 100, 393, 588
34,000 23,029,669
5,600 5,418,676
59,100 53,652,977
200.000 61,510,158
50,200 33, 612,941
238,238 245,291,106
14,850 7,889,189
9,224,105 6,977,531,676
71
CREDIT AND BANKING SOCIETIES
The development of the building and loan associations since 1920
is shown in table 54.
Table 5 4 —DEVELOPM ENT OF BUILDING AND LOAN ASSOCIATIONS, 1920 TO 1933
Number
of associa Membership
tions
Year
1920_________________________________
1921_________________________________
1922_________________________________
1923_________________________________
1924_________________________________
1925...
______________________
1926..
__________________
1927...________ ______________________
1928_________________________________
1929_________________________________
1930 3________________________________
1931 3..______________________________
1932 3__ _____________________________
1933 3_________________________ ____
1 No data.
8,633
9,255
10,009
10,744
11,844
12,403
12, 626
12,904
12, 666
12, 342
11,777
11,442
10,997
10, 727
2 Estimated.
4,962,919
5,809,888
6,864,144
7,202,880
8,554,352
9,886,997
10, 665,705
11,336,261
11,995,905
12, 111, 209
12,350,928
11,338,701
10,114, 792
9,224,105
Assets
Mortgage loans
outstanding
$2,519,914,971
2,890,761,621
3,342,530,953
3,942,939,880
4,765,937,197
5,509,176,154
6,334,103,807
7,178,562,451
8,016,034,327
8,695,154,220
8,828,611,925
8,417,375,605
7,750,491,084
6,977,531,676
3 Figures include Hawaii.
0)
0)
2$900,000,000
2 1,260,000,000
2 1,460,000,000
5,085,009,639
5,852,689,591
6,584,818,419
7,336,124,154
7,787,405,383
0)
0)
6,394,725,418
0)
Chapter 5.—Workers’ Productive Associations
W
ORKERS’ productive enterprises, i. e., businesses owned and
operated by the workers themselves, form an interesting
though small part of the cooperative movement in the United States.
Although this has seemed to be a diminishing phase of cooperation in
this country, the rate of decrease has been much smaller during the
depression years than might have been expected, there having been
a net loss of only two societies since 1929.
The survey recently completed by the Bureau of Labor Statistics,
covering 8 of the 18 workers’ productive organizations in active oper
ation at the end of 1933, shows that they had at that time, 1,181
shareholders (of whom 447 were employed in the cooperative enter
prise) and 650 nonshareholder employees. They paid in wages during
the year the sum of $772,073. With share capital of $1,234,704
and reserves of $504,590, they did a business of $3,629,470, an aver
age of $483,684 per society. Losses, however, exceeded profits by
$86,938.
Comparison with earlier years shows a gain in average number
employed, in average share capital, and in average amount of sales.
While business fell off very decidedly from 1929 to 1931, in most
lines of cooperative production, the recovery registered from 1931 to
1933 was such as to raise the average sales in the latter year above
the 1929 level. Reserves have decreased since 1929. Profits prac
tically disappeared in 1933, only 3 of the 8 societies being able to
show a net gain on the year’s operations.
It is the practice in the workers’ productive societies to return to
the shareholders the gains remaining after provision has been made
for reserves and depreciation. During the 3 years from 1930 to
1932, the societies reporting returned in these bonuses the sum of
$105,498. No bonus was paid by any of the societies in 1933.
As already indicated, the workers’ productive movement in the
United States has been a rather static phase of cooperative endeavor.
To some extent this has been due to the lines of business chosen.
Many of the societies were formed without adequate study of the
field which it was proposed to enter. In fact, the type of industry
has often been such as to mean an inevitably dwindling business for
the cooperative enterprise. The manufacture of articles by hand, in
industries which, if not wholly mechanical, are rapidly becoming so, is
a highly precarious undertaking. Thus, of the once numerous coop
erative plants manufacturing hand-blown window glass none remain,
72
WORKERS’ PRODUCTIVE ASSOCIATIONS
73
and only three factories manufacturing cigars by hand are still in
operation. In other instances groups of miners have taken over from
the owners unprofitable mines and have worked them—sometimes
successfully—but when the vein gave out the society was at an end.
Other groups have entered highly competitive businesses in which
conditions were unusually difficult. Of the numerous cooperative
shingle mills on the Pacific coast only a few remain, and these must
compete not only with other shingle manufacturers but also with the
manufacturers of patent and fireproof roofings.
That some of these cooperative groups have nevertheless attained
a considerable degree of success must be put down to their credit.
For example, a group of shoe workers started a factory 19 years ago
and each year except 1929 and 1930 has shown an expansion in
business, until in 1933 it employed in the business an average of 430
persons, and did a business of more than a million and a half dollars
a year. Although operating losses were sustained in both 1932 and
1933, the record of this organization, in an industry as competitive
and as subject to fluctuations of style as the manufacture of shoes,
shows a high quality of management. Another fine record is that of
the plywood mill, which was started in the depression of 1921. Rec
ords are not available for the years 1926, 1927, and 1928. Sales fell
from 1929 to 1930 and again in the succeeding year, but began to
rise in 1932, and from 1932 to 1933 increased by more than 50 percent.
This was one of the three societies which was able to show a net gain
on its 1933 business.
Workers’ societies may be handicapped by business inexperience
and lack of knowledge of salesmanship and of market conditions.
They may therefore be at a disadvantage when it comes to disposing
of their product.
Lack of adequate capital is another handicap and probably there
have been many societies which have collapsed in adverse times but
which could have succeeded if they had had funds enough to enable
them to absorb some loss and to tide over until conditions changed
for the better.
General Characteristics of Cooperative Workshops
T he “ideal” workers’ productive society is composed of workers
in the shop who have contributed all the capital of the enterprise
and do all the work, the business being managed by men elected by
and from the members. The worker-owners work on a wage basis,
but receive in addition any profits made from the business, these
being divided among the members by various methods.
The cooperative workshop, however, is exposed to a temptation
not present in other forms of cooperation. In the consumers’ society,
74
COOPERATIVE MOVEMENT
IN 19 3 3
for instance, it is to the interest of the members to enlarge the mem
bership, for each new member increases the business of the society.
The increased volume of business in turn reduces the percentage of
overhead expense and increases the savings made in the business and
therefore, also, the benefits accruing to each member. In the workers’
societies the situation is exactly reversed. Every additional member
increases the number who must share in the profits, though not
necessarily increasing the business done or the amount of profits to
be shared. Each new member, therefore, is likely to be looked upon
as reducing the profits of the others. Especially if the society achieves
business success, there may develop an increasing tendency among
the members to limit their numbers so as to retain all the savings
from the business for themselves, and, if additional workers are
needed, to take them on as employees, not as members. This atti
tude is accentuated in these organizations by the fact that the society
represents the members’ livelihood; and as the matter is a serious one
to them, an exclusive membership policy is quite understandable.
In direct proportion as this occurs, however, the society loses its
cooperative character.
Some unavoidable limitation upon membership is, of course, im
posed by the nature of the business or work carried on, and this
becomes greater with the degree of skill required. If the principle
that all the members are to be workers in the business is observed,
then obviously in a highly specialized undertaking, such, for instance,
as the manufacture of shoes or hand-made window glass, only persons
skilled in the various processes can be admitted as members.
The present study has disclosed varying degrees of cooperativeness
among the workers’ productive societies. Some of these cooperative
companies are in reality more of the nature of trade-union or even
joint-stock enterprises than of cooperative workshops, and this fact
is recognized by the companies themselves. One of the most success
ful societies is more nearly a profit-sharing than a cooperative society,
as only a small proportion of the workers are stockholders and of the
employees only the actual producers share in the profits.
These societies could not, therefore, be measured by the same strict
standard as the consumers’ societies. In the consumers’ movement,
although material benefits from the enterprise are desired, there is
usually also a certain amount of idealism, a vision of something above
and beyond the shopkeeping activities, with shopkeeping simply a first
step toward a better ordering of society to be striven for patiently
but hopefully in the interest of all consumers. This may not be true
of each cooperator nor of each society, for many have material benefit
as their main or only object, but it is true of the consumers’ coopera
tive movement as a whole.
75
WORKERS’ PRODUCTIVE ASSOCIATIONS
This wider vision seems to be less characteristic of the worked
productive societies.
Geographical and Industrial Distribution
S ince 1929, when the Bureau’s last previous study was made, an
upholstery association, a mining association, and a laundry have
discontinued operations or sold out. During the interval a woolen
mill was taken over by the workers, but went out of business early
in 1933, so that it figured in neither the 1929 nor 1933 survey. Another
business had become cooperative since 1929. There was thus a net
loss of two societies since that year.
As far as the information of the Bureau goes, therefore, there were
only 18 workers’ productive societies in active operation at the end
of 1933; another association had not yet taken formal action to dis
solve but had done no business since 1931 and had leased its plant to
a private firm. Of these 19 associations, 9 (including the inactive
one) made a report in the present study.
The following table shows the total number of societies in 1929 and
1933 and the number furnishing data for the latter year, by State and
by industry in which engaged:
T able 5 5.—DISTRIBUTION OF WORKERS* PRODUCTION SOCIETIES, BY STATES AND
INDUSTRIES, 1929 AND 1933
State
Indiana_________________
Massachusetts___________
Minnesota_____ _ ______
Missouri________________
New Jersey______________
Ohio___________ ________
Oregon_________________
Pennsylvania. __________
Washington_____________
Wisconsin________ ______
Tntn.1
Number in
existence Number
reporting,
1933
1929 1933
2
3
1
1
1
2
2
1
7
20
3
2
1
1
1
1
11
1
6
1
18
Type of society
1
1
i
1
11
3
Box factories_____________
Cigar factories___________
Coal m in es..________ ___
Clothing factories________
Enameling p la n ts.____
Fish canneries___________
Food factories____________
Laundries____ _________
Plywood factories_______ _
Shingle
mills_________ ___
ShnA fa.p.t.nriAS
8
Total............................
Number in
existence Number
reporting,
1933
1929 1933
1
3
2
1
2
3
1
43
1
3
1
1
1
11
1
2
1
42
11
1
1
2
20
18
8
2
i Not including 1 society not dissolved but inactive at the end of 1933
Year of Establishment
T he societies reporting have been in existence, on the average, 19
years and 3 months; the range was from 13 years to 37 years and 3
months. One society was formed in 1896, 1 in 1910, 2 in 1915, 1 in
1916, 2 in 1920, and 1 in 1921.
144224°—35-----6
76
COOPERATIVE MOVEMENT IN
193 3
Membership, Employment, and Wage Policies
As a l r e a d y indicated, membership restrictions are fairly common
among the workers’ productive societies. Of those covered in the
present study, one limits the membership to members of the trade
union of the craft. In three associations stock may be sold only to
employees, this presumably with the intention of making the stock
holders and the labor force identical. One company reports that
while there is no strict rule on the subject, shareholders are given
preference in employment. Two societies provide that each new
stockholder must be voted upon; he must receive in one society a
majority of votes of the board of trustees and in the other a majority
vote of all the stockholders. One association provides in its bylaws
that the number of members shall never be allowed to fall below 16
except by majority vote of all the stockholders.
Table 56 shows, for the individual societies, the total number of
shareholders (members) and those employed in the business, and the
number of nonshareholders employed. It is seen that in only two of
the associations were all the shareholders working in the plant at the
end of 1933. In two others there was no outsider working, but on\j
a small proportion of the shareholders had jobs in the cooperative en
terprise. Five of the eight societies employed more nonshareholders
than members.
Table 56 .—NUM BER OF MEMBERS (SHAREHOLDERS) AND OF EMPLOYEES OF
WORKERS' PRODUCTIVE SOCIETIES, 1933
Shareholders
Society
Society no. 1____________________________________________
Society no. 2 ..._________________________________________
Society no. 3_________________ _____ _______ ___________ _
Society no. 4______ _____________________________ ____
Society no. 5_____________ ______________________________
Society no. 6---------------------------- _ ----------------------------Society no. 7______________ ___ ______________________
Society no. 8—____________ ____________ _______ _________
Total-__________________________ _________ _____
Number
178
565
60
70
210
8
16
74
1,181
Number
employed
in business
90
205
7
11
45
8
16
65
447
Nonshare
holder
employees
88
231
145
33
18
135
650
Table 57 shows that the cooperative shingle mills gave employment
to all of their members and 51 nonmembers besides. With the ex
ception of the food company and the plant manufacturing plywood,
none of the others had as many as half of their stockholders working
in the plant.
77
WORKERS* PRODUCTIVE ASSOCIATIONS
T
able
NUM BER OF SHAREHOLDERS AND OF EMPLOYEES OF WORKERS’ PRO
DUCTIVE SOCIETIES, BY KIND OF BUSINESS CARRIED ON, 1933
5 7 .—
Shareholders
Number
Nonshare
of societies
holder
Number employees
reporting Number employed
in business
Kind of business
Cigar factories
_
_ _ _ _________ _
Fish canneries----------------------- --------------------------------Food factories-------------------------------------------------------Plywood factories. ---------------------------------------------Shingle mills_______________ _______ ____________
Shoe factories--------------------------------------------------------Total. ______ ________________ ______ _____
2
1
1
1
2
1
8
130
210
178
74
24
565
1,181
18
45
90
65
24
205
447
145
88
135
51
231
650
Wages.—Seven societies reported that they paid the union scale of
wages in the occupations concerned. The eighth society did not
report on this point.
More than three-fourths of a million dollars was paid in wages in
1933 by the eight societies. It is seen that the average annual earn
ings were very low, ranging from $366 to $927, with a general average
of only $704. These averages are, however, somewhat misleading,
for they are computed on the basis of all employees; while the mem
ber workers are a permanent force, the nonmember employees may
be hired only at the busy season. Again, the plant may have been
in operation only part of the year. There are no data to show wdiat
proportion of the labor force was employed on a part-time basis, or
to show how much part-time operation there was during the year.
Table 58.—TOTAL AND AVERAGE WAGES PAID BY WORKERS’ PRODUCTIVE ASSO
CIATIONS IN 1933
Kind of business
Cigar factories_______ _ ________ _____ ____ _____________
Fish cannery___________________ _________ _____ ... _
Food factory___________ _____________ ________________
Plywood factory__________________________ ... ________
Shingle m ills.._________________________________________
Shoe factory..------- ---------- ---------- -------------------------------Total_____________________________________ ________
Number of
employees
18
190
178
200
75
436
1,097
Wages paid, 1933
per
Total amount Average
employee
$8,251
73,369
65,126
158,918
62,079
404,330
772,073
$458
386
366
795
828
927
704
Hours of labor.—The work week in 1 society in 1933 was 36 hours;
in 2 societies, 40 hours; in 1 society, 42 hours; and in 1 society, 44
hours; in 1 organization the hours ranged from 30 to 40, and in 1,
from 38 to 44.
Capitalization and Business
T he value of the individual shares is generally higher in the workers’
productive societies than in other types of cooperative organizations.
78
COOPERATIVE MOVEMENT IN 193 3
Fifty dollars is a common amount, but in one organization the shares
are $600 each.
Seven of the eight societies limit the number of shares that may
be held by any one member. In one society a member may own not
to exceed $600 worth of stock and in another $10,000 worth. One
society limits the shares to 1 per member, another to 3 per member,
and a third to 20 per member. Another organization provides that
all shareholders must hold an equal number of shares, but did not
report what the number is. Another limits the shareholdings but
did not report the nature of the limitation.
In another company the common stock is being bought back from
individual shareholders and is being placed in a trust fund held for
all active workers in common. At the time of the report 63 percent
of the stock was thus held.
The share capital of the eight societies at the end of 1933 amounted
to about 1}{ million dollars. Only six societies had any surplus or
reserves; these aggregated over half a million dollars.
The combined business done in 1933 amounted to more than 3%
million dollars.
Table 5 9 —CAPITALIZATION AND BUSINESS OF WORKERS’ PRODUCTIVE SOCIETIES
IN 1933
Kind of business
Cigar factories________________ __ _______
Fish canneries_____________________________
Food factories____ ____ ____________________
Plywood factories.____________ ___________
Shingle mills___________________ _______
Shoe factories_____ _________________ ______
Total________________________________
11 society
Num
Average
ber of Paid-in
and Amount of business
societies share Surplus
reserves business,
per
1933
report capital
society
ing
21
1
211
8
$25,498
175,074
402,449
288,000
35,000
308,683
1,234,704
i $67
240,355
145, 202
(2)
50,000
68,966
504,590
$18, 798
485,286
626,191
682,603
193,976
1,622,616
3,629,470
$9,399
485,286
626,191
682,603
96,988
1,622,616
483,684
2 Not reported.
Table 60 shows, for the various types of societies, the amount of
business done each year since 1920. In most cases the high sales
occurred during the period from 1927 to 1929, but generally the
business fell off decidedly from 1929 to 1931. Some recovery in
sales was shown from 1931 to 1933, notably in the plywood and
shoe factories. The figures in parentheses at the top of each column
indicate the number of societies covered by the data.
In addition to the regular wages received when employed in the
business, the stockholder employees receive a share of any profits
made by the business. In one society the profits left after making
provision for reserves and depreciation are divided equally among
the members. In five societies they are divided on the basis of the
amount of stock held, just as in the ordinary stock company; how-
79
WORKERS' PRODUCTIVE ASSOCIATIONS
ever, as one of these societies limits the amount of stock held by any
one member to three shares in the organization and another to one
share, there is substantially equal division of profits. In the fish
cannery half of the amount of profits is placed in a reserve fund on
which stockholders receive interest at the rate of 3 percent and the
other half is divided among the fishermen in proportion to the fish
caught by each; share capital receives interest at 2 percent.
Table 6 0 —AMOUNT OF BUSINESS OF SPECIFIED TYPES OF WORKERS’ PRODUCTIVE
SOCIETIES, 1920 TO 1933
Year
1920.
1921.
1922.
1923.
1924.
1925.
1926.
1927.
1928.
1929.
1930.
1931.
1932.
1933.
Food
Plywood Shingle
Cigar fac Fish
Shoe
tories (2) cannery (1) factory (1) factory (1) mills (2) factory (1)
i $17,345 $1,019,054
601,298
i 28, 231
632,812
i 43,499
723,043
i 51,446
i 44,998
650, 756
749,192
87,170
740, 774
76,543
795, 595
81, 500
, 693
61,282
752, 693
55,106
37, 264
538, 797 $1, 571, 245
348, 418 , 222, 606
26, 203
424, 386
783,617
22,873
626,191
485, 286
18, 798
688
$175,000
(2)
363,000
451,000
627,000
796,000
1,092,697
1, 264, 561
1,374,413
1,354,818
1, 284,982
1,388,177
1,403,946
1,622, 616
(2)
i $216,613
(2)
$536,854 i 153, 200
924,812 i 166,304
712, 275 i 186,820
743, 535 i 188, 297
321,153
(2)
320,031
(2)
333,886
(2)
384, 426
846,497
463,792 i 130.861
391, 338
i 81, 686
444, 443
i 61, 216
682,603
193,976
1
Total
$1, 211, 399
846,142
1,729, 365
2,316,605
2,221,849
2,564,194
2, 231,167
2,461,687
2, 458, 274
3,393, 540
4,026,941
3, 458, 428
3,140, 481
3,629,470
No data.
11society only.
The amounts of net gain or loss on the trading operations, as well
as the bonuses received by members from profits in addition to the
regular wages, are shown in table 61. It is seen that business was
profitable through 1930; each year since that time, however, has
shown a loss. Notwithstanding the adverse conditions, members
received a bonus each year except 1933. For 1933 three societies
reported profits aggregating $45,854; the losses of two other societies
amounted to $132,792. Thus, for all reporting societies combined
there was a net loss of $86,838.
2
T able 6 1 —NET TRADING GAIN OR LOSS OF WORKERS’ PRODUCTIVE SOCIETIES
AND AMOUNT OF PROFIT DIVIDED AMONG MEMBERS, 1925 TO 1933
Net gain (+) or
loss (—)
Year
1925________________________________________
1929________________________________________
1930________________________________________
1931________________________________________
1932________________________________________
1933 _
.
__ ____________
Profit divided among members
Societies dividing
profit
Number
Number
of socie Amount of socie
ties
re
ties re
porting Number Amount
porting
divided
+155, 290
65 +$143,469
4 +103, 947
4
4
5
-4,882
-197,219
—86,938
6
887
88
2
21
1
4
$31,770
45,720
90,998
9,860
4, 640
80
COOPERATIVE MOVEMENT IN 1933
Business Methods and Management
T
final control of all of these societies lies with the general
meeting of stockholders. In all but 1 of the societies reporting, only
1 vote per member is allowed at these meetings regardless of the
amount of stock held. The societies are evenly divided as regards
proxy voting, 4 allowing it and 4 prohibiting it. One society allows
an absent member to vote by mail, provided he has a copy of the
matter to be voted upon and this copy is attached to his written vote.
Oversight of the conduct of the affairs of the society is in the hands
of a board of directors. The actual management is generally left to
an elected manager. In 1 society the manager is appointed by the
board of directors, in 2 societies he is elected by the stockholders from
their own ranks, and in 1 association he may be selected by either of
these 2 methods. Two societies are managed by a board of trustees
elected by the stockholders; in 1 of these the board consists of 9
members, and in the other the number varies as the members decide.
All of the societies subject their books to regular audits; 6 of the
societies have the auditing done by a professional accountant, 1 by
the company’s bookkeeper, and another by the stockholders.
he
Development Since 1925
T able 62 shows com parative data for 1925,
1929, and 1933.
T able 63.—DEVELOPM ENT OF WORKERS’ PRODUCTIVE SOCIETIES IN 1925, 1929,
AND 1933
Item
Total number of societies___________________________
Number of societies reporting-----------------------------------Shareholders:
Number--------- ------------------------- - ___ . --------Number employed------------------------ ----------------Nonshareholder employees---------------------------- --------Share capital:
Amount----------------------------------------------------------Average per society--------------------------- ------ -----Surplus and reserves:
Amount-. -----------------------------------------------------Average per society--------------------- .. --------------Business:
Amount---- --------- -------------------------------- -----------Average per society-------------------------------------------Profits:
Am ount______________________________________
Average per society-------------------------------------------Bonuses to shareholders:
A m ount_____ _ _________________ _ __ _____
Average per society. _ _________________________
*Net, after deducting losses.
1925
1929
2139
2,438
465
807
$1,025,509
51,275
653, 590
72,621
4,573,329
238,596
i 229,458
16,390
109,470
27,368
1933
2011
1,405
421
236
$808,230
73,475
800,139
100,007
3,847, 666
349, 788
1 153, 370
30, 674
48,635
9, 727
1Loss.
8
18
1,181
447
650
$1,234,704
154,338
504,590
63,074
3,629,470
483,684
2 86,938
* 17,388
@FedFRASER