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U N IT E D ST A T E S D E P A R T M E N T OF L A B O R
Frances P erkin s, S ecreta ry
B U R E A U O F L A B O R S T A T IS T IC S
Isador L ub in , C om m issioner (o n lea ve)
A . F. H in rich s. A ctin g C om m issioner
Cooperative Associations in Europe
and T h eir Possibilities for P o st-W a r
R econstruction
By
Florence E. Parker
and
Helen I. Cowan
o f the Bureau o f Labor Statistics
Bulletin 7slo. 770
U N IT E D S T A T E S G O V E R N M E N T P R IN T IN G OFFICE, W A S H IN G T O N : 1944
F or sale b y th e S u p erin ten d en t o l D ocu m en ts, U. S. G o v e rn m e n t P rin tin g O ffice
W ashington, D . C
Price 35 cen ts
Letter of Transmittal
U
n it e d
S tates D
B
epartm en t of
ureau
of
L abor,
L a b o r S t a t is t ic s ,
Washington, May 12, 1944*
The S e c r e t a r y o f L a b o r :
I have the honor to transmit herewith a report on the development of
cooperative associations in Europe and their possible place in post-war
reconstruction. This report was prepared by Florence E. Parker and
Helen I. Cowan of the Bureau’s Editorial and Research Division,
assisted by Jeannette M. Watson and Elizabeth L. Black.
A. F. H
Hon.
F
rances
P
in r ic h s ,
e r k in s ,
Secretary oj Labor.
n
Acting Commissioner•
Preface
Origin o f Present Report
The present report was compiled as a result of requests from various
official agencies concerned with the rehabilitation of the war-devas
tated countries of Europe, but was extended to cover the other
countries of that continent. Much of the material contained herein
has already been supplied to those agencies in the form of special re
ports and memoranda dealing with individual countries or with special
aspects of the cooperative movement.
Scope and Coverage o f Report
Data on the individual countries of Europe are presented in Part 2
of the report. In most cases the account gives some historical back
ground, showing how the economic events of the time, as well as the
changes in governments and in national boundaries, affected the
cooperative movement and helped to speed or retard its development
and change the direction of its expansion.
The main subject matter of this report covers the consumers’
cooperatives of various types (distributive and service, housing, credit,
insurance, etc.), as well as workers’ productive and labor cooperative
associations. A special attempt has been made in each country to
cover certain special forms of cooperation in which the country has
excelled or for the origin of which the cooperative movement of the
country was responsible. For this reason certain types— such as
workers’ productive associations in France, for example— are described
at greater length than in other countries where they are of minor
importance. The length of treatment was also determined to a great
extent by the availability of material. Although the reports here
given cannot be said to be exhaustive— space limitations precluded
this— the basic research covered all the sources of material available
to the Bureau and included not only printed reports and studies, both
official and unofficial, but also unpublished material in the Bureau’s
files as well as typewritten reports from consular officials and others.
Certain phases of agricultural cooperation, such as rural electricpower, credit, and insurance cooperatives, are also covered. Strictly
producer cooperatives—farmers’ marketing and processing and pur
chasing of farm supplies— are shown mainly in statistics designed to
give a national picture of the entire movement. Thus, in every
country for which such figures were available, data are given showing
the number, membership, and business of all the various types of
associations, including the agricultural, in the latest year obtainable
(generally 1937).
A description is given of the movement and some indication of its
place in the economic life of the country, just prior to the rise of
in
iv
Preface
National Socialism or to the country’s invasion by the Nazis. In
most cases the cooperatives had largely recovered from the depression
and had already completed or were undertaking a reorganization—
structural and financial— designed to strengthen the movement and
increase its efficiency. In general, the cooperatives had entered upon
a period of both expansion and intensification of activities, when this
was interrupted by the outbreak of World War II.
The chronicle of subsequent events is presented here through 1942,
and thereafter for each country as far into the present as reports
available permitted. For countries still accessible for news and com
merce (Great Britain, Sweden, Switzerland, etc.) the data include
statistics and other information as late as the autumn of 1943. For
invaded territories, and the Axis countries and their satellites, only
fragmentary reports have seeped through, though in some cases an
astonishingly complete picture can be pieced together from these.
The reader will notice that certain countries (such as Great Britain
and the Scandinavian countries) are treated here at less length than
their importance in the movement would seem to warrant. This was
deliberate. For these countries much current and popular literature is
easily accessible. It was deemed advisable, therefore, to concentrate
rather on those countries where the movement was well developed,
but for which little information is readily available. Further, because
of space limitations, certain aspects of the cooperative movement
have been ignored entirely or touched upon merely in passing or only
as they were necessary for the understanding of the general situation.
Among these were the working conditions and the relations of co
operatives with their employees, the structural machinery of the
movement, and its merchandising policies.
A cross-section view of the whole of Europe, as regards cooperation,
is presented in Part 1, which also brings together information on the
international organizations and aspects of cooperation in both the
educational and commercial fields. The report does not contain a
directory of the national organizations in the various branches of co
operation; for such data the reader is referred to the International
Directory of Cooperative Organizations, compiled by the International
Labor Office (Montreal) in 1939, and available through that organi
zation.
Aside from the practical uses of the material here presented, on
post-war problems, it is believed that the report will also fill a hitherto
unsatisfied need for concise accounts of cooperation in various coun
tries. It should likewise be useful to cooperative study groups,
students in educational institutions, and others desiring to obtain an
understanding of the extent of the cooperative movement, without
resort to exhaustive study.
Contents
Page
Preface........ ............................................................................................................
Development of European cooperatives, and their possible place in post
war reconstruction:
Extent of the cooperative movement___________________________________ Characteristics of cooperatives--------------------------------------------------------------National federation____________________________________________________
International cooperative organization__________________________________
Cooperatives and the totalitarian State_________________________________
Cooperatives and reconstruction------------------------------------------------------------Part 1.— Comparative analysis of the European cooperative movement:
Development and characteristics-----------------------------------------------------------Types of cooperatives and extent of development------------------------- —
Consumers’ cooperative movement_________________________________
Consumers’ cooperative movement during and immediately after the
depression. _------_-----------------------------------------------------------------------Consumers’ cooperation just before World War I I ---------------------------Place of cooperatives in the national economy---------------------------------Cooperatives in World War I I _____________________________________
International aspects of the cooperative movement--------------------------------International Cooperative Alliance_________________________________
Scandinavian Cooperative Wholesale----------------------------------------------International Cooperative Wholesale Society_______________________
International Cooperative Trading Agency----- --------------------------- —
International cooperative production_______________________________
International Cooperative Women’s Guild--------------------------------------Other international activities_______________________________________
Part 2.— Development of cooperatives in individual countries:
Countries of Western Europe----------------------------------------------------------------British Isles_______________________________________________________
Types of associations---------------------------------------------------------------Structure of the consumers’ cooperative movement_____________
Retail cooperatives and their operations-----------------------------------Federations in the consumers’ cooperative movement___________
Cooperatives and the war. -----------Cooperation in Ireland________________
Belgium___________________________________________________________
Types of associations and their activities__________
Development of distributive cooperatives______________________
Social and welfare activities of distributive cooperatives________
Structural and other changes necessitated by the depression____
Trends of development of retail and central associations________
Consumers’ cooperatives just prior to outbreak of war— _______
Cooperatives and the war____ _________
France......................................
Types of associations_____________
Relations with the Government________________________________
Early development of consumers’ cooperative movement_______
World War and post-war development_________________________
Welfare work_________________________________________________
French Cooperative Wholesale Society_________________________
Cooperatives during the pre-war decade________________________
Effect of the war on cooperatives______________________________
Workers’ productive associations_____________________
Netherlands_____________________________________
Types of local cooperatives____________________________________
Development of consumers’ cooperative movement_________________
Cooperatives and the war_______________________________ . _____
y
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VI
Contents
Countries of Western Europe— Continued.
Luxemburg________________________________________________________
Switzerland__________________________________________________________
Types of cooperatives___________________________________________
Structure of the consumers* cooperative movement_____________
Development of consumers* cooperative movement_______________
V. S. K.— A four-language cooperative federation_______________
Swiss cooperatives and the State________________________________
Scandinavian countries----------------------------------------------Denmark____________________________________________________________
Types of cooperatives and their activities________________________
Development of consumers* cooperatives through 1939___________
Federations of the consumers* cooperative m o v e m e n t--,_________
Cooperation under the Nazis____________________________________
Finland.......... ............................................................
Types of cooperatives___________________________________________
Development of consumers* cooperatives_________________________
Consumers* cooperatives prior to outbreak of World War I I ____
Cooperatives and the State______________________________________
Consumers* cooperatives in World War I I _______________________
Norway_____________________________________________________________
Consumers* cooperatives________________________________________
Cooperatives and the State____________________________________
Cooperatives and the war______________________________________
Sweden_____________________________________________________________
Types of cooperatives and their activities________________________
Development of consumers* cooperatives_________________________
Cooperative Union and Wholesale, Kooperativa Forbundet_____
Cooperatives in World War I I ___________________________________
Iceland______________________________________________________________
Extent of cooperative development____________________________
Effects of the war_____________________________________________
Development of cooperatives, 1921-42____________________
Baltic States.......................- .................................- ..............................................
Estonia_____________________________________________________________
Types of associations........ .............................................
Development of consumers* cooperatives_________________________
Estonian cooperatives in World War II__________________________
Latvia________________________________________________________
Types of associations and their activities_________________________
Development of consumers* (trading) cooperatives________________
Cooperatives under State domination____________________________
Lithuania___________________________________________________________
Types of associations____________________________________________
Development of trading cooperatives____________________________
Lithuanian cooperatives in World War II ________________________
Countries of Central and Eastern Europe_________________________________
Austria----------------------------------------------------------------- ----------- - ............
Types of associations— _____________________________
Development of consumers* cooperatives_________________________
Depression arid the corporative State, 1930-38___________________
Cooperatives under the Nazis___________________________________
Czechoslovakia______________________________________________________
Types of cooperatives_______________________________ - ________
Development of consumers* cooperatives under Austrian rule___
Consumers* cooperation under the Republic______________________
Legal status and relations with the Government__________________
Status of cooperatives just prior to Munich Agreement___________
Cooperative movement and the Nazis____________________________
Germany____________________________________________________________
Types of cooperatives___________________________________________
Cooperative housing (building) associations______________________
Credit and agricultural associations______________________________
Distributive cooperatives________________________________________
Condition of consumers* cooperatives immediately preceding
National-Socialist Regime___________________
Cooperatives under the Nazis___________________________________
98
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202
Contents
Countries of Central and Eastern Europe— Continued.
Hungary____________________________________________________________
Types of cooperatives and their activities________________________
Hangya associations, 1898-1935_________________________________
Place of cooperation in the economy of Hungary_________________
Developments since outbreak of present war_____________________
Poland. _____________________________________________________________
Types of associations____________________________________________
Consumers’ cooperatives________________________________________
Effects of the war_______________________________________________
Soviet Union________________________________________________________
Cooperatives through World War I ______________________________
Types of associations____________________________________________
Cooperation under the Soviet Government_______________________
Cooperatives in World War I I -------------------------------------Countries of Southern Europe____________________________________________
Italy________________________________________________________________
Types of associations and their activities_________________________
Consumers’ cooperative movement____________________________
Italian cooperatives in World War I I _________________________
Portugal____________________________________________________________
Spain__________________________________________________________
Types of cooperatives___________________________________________
Development of cooperatives under the Republic_________________
Cooperatives during and since the Civil War_____________________
Balkan countries_______________________________________________________
Bulgaria________________
Development of cooperatives, 1900-39________________
Relations with the Government_________________________________
Status of various branches of the movement, 1939_______________
Intercooperative relations_______________________________________
Cooperatives and the war_______________________________________
Greece______________________________________________________________
Types of associations____________________________________________
Cooperatives and the war_______________________________________
R u m an ia-._________________________________________________________
Development of cooperation under State supervision and controlTypes of cooperative associations and their activities-------------------Cooperatives of national minorities_________________________
Rumanian cooperatives just before the war---------------------------------Rumanian cooperatives in wartime_______________________
Yugoslavia----------------------------------------------------Types of cooperatives and their activities________________________
Recreational and cultural aspects of cooperatives--------------.------Cooperatives in the decade prior to the Nazi invasion----------- *Cooperation under the Nazis__________________________________
Albania_____________________________________________________________
Appendix— Par values of national currencies--------------------------------------In d ex...........................................................................
VII
-Pas®
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Bulletin T^o. 770 o f the
U n ited States Bureau o f Labor Statistics
Development of European Cooperatives,
and Their Possible Place in Post-War
Reconstruction
Extent o f the Cooperative Movement
Cooperation, in its widest sense, has probably existed since the
beginning of mankind. In some countries, such as China, Yugoslavia,
and Russia, primitive forms of cooperatives are known to have been
carried on as far back as history goes. One Russian authority states
that in that country cooperatives are at least a thousand years old.
In the early days in Yugoslavia, family and village life was all organ
ized on the “ Zadruga,” or cooperative, basis.
Even in the modern form, the consumers' cooperative movement is
already 100 years old, and celebrates its centenary in 1944. The first
cooperative store was open only in the evenings and had as its sole
inventory a small amount of butter, sugar, flour, tea, and oatmeal pur
chased with the shillings painfully saved by its poverty-stricken
members— 28 cotton weavers of the town of Rochdale, England.
The original store of the Rochdale Pioneers in Toad Lane, now
restored to its original architecture, is a museum and the mecca of
cooperative travelers.
In the 100-year interval, the idea that animated the Pioneers spread
not only throughout the neighboring continent but ail over the world.
There is hardly a country without some form of cooperative. In
Europe the distributive association, operating grocery stores, bakeries,
and other shops, is the predominating type. In Asia and the Far East,
where thrift and credit have been the most urgent needs of the debtridden populations, credit cooperatives have usually predominated.
In agricultural countries farmers have banded together in cooperatives,
to market their farm produce or process these products, and to buy
their farm and household supplies.
In 1937, there were over 800,000 cooperative associations of various
tvpes, with a membership of about 145 million persons, in 56 countries
throughout the world. In Europe—with which the present report
deals— nearly 575,000 cooperatives were in existence, with over
11134 million members. Every country in Europe had cooperatives of
some kind, and in some of these countries cooperators comprised a
large proportion of the population and cooperative trade had become
the largest single business enterprise in the country.
1
2
Development o f European Cooperatives
Characteristics o f Cooperatives
These cooperative organizations, wherever they have taken root,
have had certain characteristics (inherited from the Rochdale Pioneers)
which set them apart from all other forms of business activity. These
are (1) open membership, (2) one vote per member, (3) return of
surplus earnings to members in proportion to the amount of their
patronage of the cooperative enterprise, (4) limited return on members’
investment (i. e., share capital), (5) political and religious neutrality,
(6) transaction of business on cash basis only and at current prices,
and (7) promotion of education in the cooperative philosophy.
National Federation
As the local associations have expanded in number, they have
federated into central organizations either educational or commercial,
or both. The educational federations have served as mediums o f
exchange of experience, sources of education of members and training
of employees, protective sentries against attacks (legislative or other)
on the cooperative movement, and as bodies for formulating policies
and presenting the views and ideas of the organized membership.
The commercial federations have carried on wholesaling of supplies ta
member associations and have more and more undertaken production
of goods themselves. In a number of countries central wholesale feder
ations have exerted a powerful restraint on price levels, thus benefiting
all consumers as well as their own members. In all but two countries
of Europe—Albania and Greece—the consumers’ cooperative move
ment had become integrated into such national federations before the
present war.
International Cooperative Organization
The national organizations, in turn, have since 1896 been organized
internationally. Their superfederation, the International Cooperative
Alliance, is not a commercial* organization. Its purposes are to
promote the spread of cooperation throughout the world, to bring about
closer relationships among the cooperative movements of the different
countries, and to study means of further cooperative progress in various
lines. Under its auspices one committee has had as its sole function the
promotion of business and other collaboration between the agri
cultural marketing and consumers’ branches of the movement. Another
committee has studied the possibilities of international relationships
in the field of insurance, and a third has been concerned with the estab
lishment of an international cooperative bank. One of the first organ
izations formed under the sponsorship of the Alliance was the
International Cooperative Wholesale Society. That organization
undertook no wholesaling itself; its function was to study the problems
encountered by the wholesale organizations and to make the results
of its studies available to them. One result of its activities was the
formation of the International Cooperative Trading Agency in 1937.
The Agency did not carry on warehousing. It acted as purchasing
agent for the national wholesales, pooling their orders and making
master contracts for goods delivered directly to the various countries.
Place in P ost-W a r Reconstruction
3
It also acted as sales agent for some of the wholesales; disposing of
their surplus production or stocks to the organizations in other
countries. Its activities have, of course, been drastically reduced
during the present war, but it is still operating and will be ready to
expand immediately at the end of the war.
Cooperatives and the Totalitarian State
The essence of cooperative development is that it is the voluntary
achievement of free people, working on a democratic basis for the
attainment of definite social and economic ends. In this respect it is
a twin of labor unionism and, in fact, in many of the industrial
countries of Europe the two movements have been extremely close,
and a great proportion of the workers were both cooperators and tradeunionists.
The rise of totalitarianism meant for each of these movements added
problems, increasing restrictions, and in some cases extinction, for
the totalitarian state is by its very nature antagonistic to freedom of
choice and action and to movements built upon these freedoms. As
the Nazi ideas gained ground and the Nazi machine took possession,
labor movements were absorbed into Labor Fronts on the fuehrer
principle. As for the cooperatives, in some countries their networks
were utilized for the benefit of the Germans’ plans; in others the
movement was deliberately destroyed in whole or in part and its assets
were seized by the invaders. Some cooperative leaders were killed,
others fled the country or went underground. In the general Nazi
program of looting and destruction, as well as in the actual processes
of warfare, cooperators with others of their countrymen have lost their
homes and their personal belongings, as well as the cooperative enter
prises they had built up over so many years.
Cooperatives and Reconstruction
All of these facts are well known throughout the cooperative move
ment. Cooperators in the United Nations, and nationals of oppressed
countries who have fled to free territory, have therefore been very
conscious of the problems of the post-war period. Particularly
through the International Cooperative Alliance cooperatives have been
devoting much thought, during the past 2 years, to these problems
and especially to the part that cooperatives can play in the immense
job of reconstruction. In those countries that have been the battle
fields of the war or have been devastated and impoverished during the
Nazi occupation, large proportions of the people are cooperators.
All will need food, clothing, medicines, and living quarters. Their
cooperative associations will need to be restocked with goods and their
productive facilities—worn out, carried off, or destroyed—will need
to be built up again.
All these items and the problems which they entail have been in
process of study by special cooperative committees in the United
States and in Great Britain (the headquarters of the Alliance is in
London). The president of the Cooperative League of the U. S. A.
participated in the United Nations Food Conference in May 1943, as
a member of the delegation appointed by the United States Govern
4
Development o f European Cooperatives
ment. Some months later, a cooperative conference was held in
London and one also in Washington, attended by representatives of
cooperative movements from the various countries involved in reha
bilitation plans as well as from Scandinavia, Great Britain, and the
United States. The cooperative conferences were devoted to consider
ing the problems involved, as regards the cooperative movement, in
the post-war period, and the place of cooperatives in the general relief
and reconstruction program.*
Both conferences approved a plan for the formation of an Interna
tional Cooperative Trading and Manufacturing Association, the mem
bers of which would be the national cooperative organizations of the
various countries. This association, plans for which have been formu
lated, is to carry on production, processing, and the distribution of
goods to cooperative associations abroad. All of its work would be
on a loan basis, the amounts and goods advanced to be repaid eventu
ally. For the immediate relief necessary to tide over until the con
structive work can begin, and to aid in the preliminary work of re
habilitation of cooperatives, a fund is being raised by popular sub
scription among cooperators in both Great Britain and the United
States.
Speakers at the international cooperative conferences emphasized
that cooperation is a self-help movement, that it is strongly rooted in
the lives of the European people, and that all they ask is a chance to
become self-sustaining again. Delegates expressed the belief that as
the cooperative associations were so widespread throughout Europe
they represented a practical, efficient, and nonprofit method of dis
tributing the materials of relief and rehabilitation not only to their
members but to others in their communities, and thus should play !a
valuable part in the post-war work. They also represent a technique
well known and widely practised, which can be under way in a fairly
short time after the cessation of hostilities.
Part 1.— Comparative Analysis o f the
European Cooperative Movement
Developm ent and Characteristics
Just before the outbreak of war, membership in the nearly 575,000
cooperative associations in Europe exceeded 11 IK millions. Over
half (54 percent) of the membership was in the Soviet Union, 12
percent in other now Allied or neutral countries, 20 percent in territory
occupied by the Axis in the war, and 14 percent in Axis countries.
Practically without exception the movement had recovered from
the depression by 1937 and was well on the upgrade.
In the Allied and neutral countries the movement has continued to
advance even under war conditions. Such information as is available
indicates that the same is true in the Axis and satellite countries (except
Germany and Austria), although the cooperatives are usually under
strict control by the Government.
After the rise of National Socialism in Germany (and, later, in
Austria), it became apparent that the democratic make-up and social
ideals of these cooperative organizations were the exact antithesis of
the “ New Order.” To this was added, in the case of the consumers*
cooperatives, the fact that they were competitors of the retail trades
men, of whom the Hitler regime was the avowed champion. It was
natural, therefore, that the consumers’ cooperatives in those countries
were at once marked for destruction. After the beginning of the war,
as one country after another fell before the German war machine,
consumers’ cooperatives received the unfavorable attention of the
Nazis in all countries except where (as in Belgium, Denmark, and the
Netherlands) they were desirous of winning the people’s good will.
Even in the other countries, after the initial destruction that was
characteristic, other factors operated to deter the Germans in their
onslaught on cooperatives. The cooperatives represented— as did
the labor unions also— a structure built by the people themselves,
representing their aspirations and their desires. Not only did the
cooperatives supply their members’ physical needs for food, clothing,
housing, medical care, etc.; in some countries these associations were
also essential in the social and cultural fields and had thus become an
integral part of all phases of daily life. Further, cooperation loomed
large in the economy of the countries themselves. Cooperatives had
become the largest single enterprise in certain States and as such were
a factor to be reckoned with. These considerations retarded the pro
gram of destruction (even in Germany itself, nearly 10 years elapsed
before the consumers’ cooperatives could be suppressed entirely).
Furthermore, the Nazis found cooperative facilities necessary—in
5
6
Comparative Analysis
some cases indispensable—to the functioning of the processes of pro
duction and distribution in the territories they invaded; they there
fore used them and in some cases even fostered their growth.
It is believed that, because of the strong hold of the cooperatives
upon the workers of Europe, the movement can be revived rather
quickly where it has been destroyed, and where it still exists can be
utilized immediately after the cessation of hostilities as a practical
and effective form of machinery in the immense tasks involved in the
reconstruction of Europe and the redirection of energies toward peace
time pursuits. This will involve no new form of organization for the
.millions of cooperators; it will be merely a resumption of the activities
that were formerly a normal and accepted part of their lives.
T ypes o f Cooperatives and Extent o f Development
Of over 800,000 cooperative associations of all types in existence
throughout the world in 1937, nearly 575,000 were in the various
countries of Europe (including the Soviet Union). Among the
European cooperatives, the Soviet Union accounted for 50 percent,
the other countries still free or neutral in the present war 1 for 6 per
cent, the countries that have been occupied by the Axis armies 2 for
28 percent, and Axis countries 3 for 16 percent of the associations.
Nearly 70 percent of the cooperatives were farmers' marketing and
processing associations; and a large part of the associations classified
as credit were also farmers' organizations.
T
able
1.— Num ber o f European Cooperative Associations, b y Country and T yp e
Country
Workers’
Con Credit produc Hous Agricul
Year All types sumers’
tive and
ing
tural
labor
Other
1937
1937
1937
1937
574,401
161,049
321,032
92,320
46,699
8,792
28,789
9,118
72,190
36,284
1,563
34,343
24,081
2,970
16,759
4,352
10,592
2,782
2,711
5,099
399,490
105, 508
260,849
33,133
21,349
4,713
10,361
6,275
1937
34,437
4,676
1,563
1,182
2,711
13,944
10,361
Austria................................................... 1937
1935
1930
1924
Belgium__________ ______ _________ 1938
1937
1931
1929
Bulgaria___________________________ 1939
1937
1929
1925
Czechoslovakia..................................... 1937
1936
1930
1923
Denmark_______________ __________ 1937
1931
Estonia.................................................. 1938
1936
1929
1925
Finland................................................. 1939
1937
1929
1923
5,478
222
2,205
‘ 184 *2,169
302
2,308
402
2,114
360
203
360
203
396
200
377
157
2,378
161
154
2,115
138
1,707
187
1,335
4816
8,085
816
7,579
1,840 •6,057
•2.261 ' 5,852
1,953
100
•1,936
43
183
242
190
213
250
210
287
145
545
1,123
539
1,179
10803
1,556
596
928
(**)
(»)
(•)
860
57
56
50
51
735
271
238
199
1,504
1,504
826
1,825
76
(*)
44
(3)
00
67
•4
4
290
00
300
263
125
124
128
128
8
10
145
79
41,341
1,341
1,590
1,326
17
15
10
28
00
(7)
•100
100
00
(7)
1,998
*2,892
1,672
1,298
454
446
388
350
18
418
219
139
5,451
5,364
4,348
3,479
3,775
•6,445
1,286
1,956
790
1,324
92,933
2.933
818
1,138
763
30
790
38
2,283
2,246
1,605
1,411
138
2,541
753
263
4140
140
608
199
290
•5
192
693
1,250
•416
*575
575
2,825
•964
All countries........................................
Occupied__________ ___________
Free or neutral.............................
Axis.................................................
Free or neutral (excluding
Soviet Union)________ ______
5,275
5,372
4,965
3,482
3,435
2,767
2,474
3,438
5,509
3,200
2,202
17.337
16,744
15,269
14,942
6,211
8,444
1,957
3,060
2,500
2,239
5,280
5,330
6,002
3,626
See footnotes at end of table.
1 Great Britain Iceland, Ireland, Portugal, Soviet Union, Spain, Sweden, and Switzerland
8 Belgium, Czechoslovakia, Denmark, Estonia. France. Greece, Latvia. Lithuania, Luxemburg, Nether
lands, Norway, Poland, and Yugoslavia.
* Austria, Bulgaria. Finland, Germany, Hungary, Italy, and Rumania.
Development and Characteristics
T able 1.—Num ber o f European
Franne____________________________
Germany_____________________ ____
Greece _ _
TTimgary
_
_ .
_________________
__________________
Iceland _ _ ...
Irish Free State (Eire)________ ____
Italy.......................................................
Latvia. __________________ __ _
_
Lithuania................. ............................
Luxemburg______________________
Netherlands_______________________
Norway___________________________
Poland............... ...................................
Portugal _ ..
Rumania
Cooperative Associations, by Country and T yp e —Con.
Workers’
Con Credit produc Hous
Year All types sumers’
tive and
ing
labor
Country
Great Britain
7
_____ j
Soviet Union______________________
Spain__________ __________________
Sweden___________________________
Switzerland_______________________
Yugoslavia................. ................ ........
1937
90,433 <1,200 10,647
1936
83,804
1,200
6,148
30,741
1,237 11,397
H1931
1938, 50,254
1,488 20,005
1937
51,095
1,512 20,283
1935
51, 762
1,634 20,866
1933
49,941
1,674 21,607
1923
47,040
2,475 20,931
3,794
1937
1,136
1936
3,863
1,087
1930
3,155
1,248
1925
1,917
1,381
5,948
1937
4,327
1936
9,611
4 , 476
625
1928
6,243
3,801
115
2,064
1925
3,655
105
1937
3,516 m 1,800
1,009
1935
4,502
1,402
1,800
U1930
3,293
1,022
1,649
1926
3,366 » 1,820 « 1,016
64
1937
2
1936
96
39
528
1941
72
20
1937
668
90
21
14,948
2,812
1937
3,865
14,928
1936
3,465 i* 2, 530
1930
9,033
3,329
0
2,196
503
1938
184
1937
1,729
532
187
1930
1,780
605
295
1924
381
24
229
1939
1,332
401
275
407
1937
1,257
57
1930
1,451
460
320
1937
1,012
408
71
1934
738
” 50
56
4,883
1937
424
1,370
879
1936
3,252
424
1929
904
3,131
409
1926
3,088
489
893
1937
3,895 i® 1,090
2,709
1936
549
1929
3,231
410
13,908
1937
5,737
1,976
1936
13,545
5,863
1,790
6,169
16,801
1930
6,128
1937
25
25
1934
150
19
1*127
(3)
1929
271
150
5,140
1938
10,080
2,791
4,740
6,444
1937
1,026
1930
10,276
2,122
4,757
1924
3,886
2,650
0
1937 286,595 24,113
1934 184,293 45,764
5,726
1937
1,803
1934
4,275
i 12
353
12,437
816
1937
811
1,008
1936
20,411
1,438
14,654
361
1930
1,609
1924
11,665
250
1,561
688
1940
11,599
898
1937
11,723
878
657
1930
533
11.176
866
1924
551
11,443
859
1938
4,912
10,832
2,530
4,563
1937
9,044
138
(23)
4,418
1930
7,077
i Data relate to 1933.
* Data relate to 1934.
* No data.
* Data relate to 1936.
* Data relate to 1929.
* Includes workers’ productive associations.
i Included with ‘ other.”
•Includes housing associations.
* Data relate to 1937.
Includes a few associations of other types,
n Data relate only to associations affiliated with
central organizations.
12 Data relate to 1923-24.
648
642
340
1,917
1,948
1,898
1,828
3,789
159
46
78
105
437
2 278
242
3,372
3,452
3,616
3,813
3,265
1,333
356
283
238
1,721
0
446
66
216
71
«76
2
946
341
0
1
105
0
0
6
1*3
108
108
1,204
i* 1,873
17 696
®6
6
i« 1,674
i* 1,194
1,146
18
30
0
224
8
8
17
17
26
27
*6
0
0
218
* 24
0
0
4
2
414
138
143
153
*10
10
0
330
341
864
Agricul
tural
77, 501
31,000
17.500
22 ,2 3 9
22,403
22,001
18,821
16,580
1,166
1,260
1,418
1 2 181
1,621
1.007
1,187
519
1*640
806
550
«454
54
1*46
296
417
4,640
5,007
3,742
564
526
450
125
430
778
632
533
567
1,838
1,435
1,327
1,196
2,780
2,148
1*2; 821
5,357
4,844
2,516
Other
*44,536
25
1,233
1,497
1,747
2,198
0
0
*1,114
128
12
836
799
521
173
1
i*8
®26
26
753
1*859
120
927
454
430
3
2
3
29
0
9 65
820
359
302
330
2
0
290
683
1,124
4
0
657
2389
0
314
15,577
18,363
847
79
168
235
175
255
52
159
363
92
142
0
0
42,102
13
1,217
1,000
6,784
5,295
0
244
251
260
241
124
95
81
955
*101
2,447
21922
246.905
*2 78,064
3,056
2,212
3,689
4,576
3,857
3,328
5,587
5,562
5,506
5,598
1,920
3,607
2* 2,026
121
537
1146
950
0
0
0
7
402
5,953
6,370
3,357
*6,271
4,182
4,375
4,601
4,142
1,187
278
460
is Estimated; total agricultural and consumers'.
2 440.
11Data relate to 1923.
i®Data relate to 1935.
i®Includes fishery associations.
1? Data relate to 1932.
12 Data relate to 1931.
i# Data relate to 1941.
20 Includes some agricultural associations.
21 Some associations included with agricultural.
22 Data relate to 1928.
23 Included with agricultural associations.
2<Includes consumers’ cooperatives.
8
Comparative Analysis
The consumers’ cooperatives, which constituted slightly oyer 8
percent of the total number of associations in that year, had slightly
over 53 percent of the total membership. The greatest relative
development of this type of association was in the Allied and neutral
countries, where consumers’ cooperatives accounted for 67 percent of
the total membership; if the U. S. S. R. is excluded, the proportion in
these countries was 80 percent.
T a b l e 2.— M em bership oj European Cooperatives, by Country and T yp e o f Association
Country
All countries...................
Occupied..................
Free or neutral____
Axis...........................
Free or neutral (exeluding S o v ie t
Union)...................
Austria______ - ...............
Belgium----------------------Bulgaria-----------------------
Czechoslovakia.-----------Denmark______________
Estonia_______________
Finland
_____________
Franny
Germany______________
Great Britain---------------
Greece_________________
Hungary.
_______
Iceland.______________
Ireland.............................
Italy ,
Latvia_____________ __
Lithuania
Luxemburg
Netherlands
_
Year
1937
1937
1937
1937
All types
111. 651.126
22.341,061
73,610,568
15.699.497
1937
1935
1931
1937
1935
1924
1939
1937
1929
1925
1937
1934
1930
1937
1936
1930
1938
1936
1941
1937
1929
1923
1937
1936
1931
1937
1934
1933
1937
1936
1930
1925
1937
1936
1937
1936
1931
1926
1942
1937
1941
1937
1937
1935
1930
1938
1937
1930
1938
1935
1930
1937
1934
1931
1937
1935
1931
Credit
Workers’
produc
tive and
labor
Hous*
ng
59, 488, 489 12.664,618 2.902,446 1,184. 530
5,453, 735 6.631.015
86, 718 156,068
49,521,603
264. 217 2. 526, 482 147,653
4,513,151 5,769.386
289, 246 880.809
1937 12,850,676 10, 321.603
264,217
807,984
472,859
263.000
1,017,885 * 264, 464 * 275, 421
823,300
350,000
0)
825,542
98,492
510,068
346,568
815,193
(i)
77.706
626,646
405,288
950, 571
97,937
441. 981
1,008.577
84,449
389.097
709,009
72,259
319,271
516,588
80.503
199,191
4,670,388
805,544 2,983,360
3,500.300 «1,031, 714 1,000.000
2,301,281
910,705
939,104
1,653.768
391,100
21,356
1, 791,871 »437.625
*20,042
1. 383.971
331,500
0)
105.443
220.320
46,278
220.504
41, 359
2 92,775
1,120.424
676,000 t* 147,500
868,373
147,500
562,300
871, 223
456,386
138,762
467,255
352.255
63,000
8,500,605 2,671,000
642,179
4, 558.615 1,600,000 18586,372
3,354,889 1, 576, 256
732,333
8,356,370 2,010,911 3,235,582
8, 224,510 1*3,211,800 3,041,182
7, 700,623 1*3,344,410 173,205, 528
8,405,903 8,023,073
16,209
8,119,471 7, 746,184
<0
6,702,277 6,353,000
0)
5,017,464 1*4,910,983
0)
250,890
193,901
220,112
* 95,000
1,302.811
763,428
421,507
1,358,014
630,000
423,852
1,477,103 7804,821
399,005
887,863 2*870,549
0)
20,189
20,189
12,000
12,466
100,473
15, 771
8,794
9,222
159,277
8,899
1,957,000
800,000
775,000
1,895,359
310,146
900,000
1,714,920
377,918
205,964
27,577
375,088
202,696
27,047
212,587
50,320 i® 15,000
174,542
21,525
117,155
178, 797
21.322
121,000
146,053
35,617
98,300
19,588
46,701
8,576
(**)
60,671
6,321
(2 2 )
57,907
4,879
973,422
325, 368
214,001
232,127
553,034
320,907
510,344 7222,053
223,291
See footnotes at end o f table.
Consum
ers'
123, 511
147,653
38,711
28,508
68,000
(i)
70,300
0)
5,608
C)
5,742
0)
5,208
h
28,804
197,974
28,541
* 141,115
7,919
58,860
36,744
7,060
71,909
23,011
7 151,472
(*)
151, 472
0)
12,980
M
0)
0)
h
234
300
(*)
0)
“ 1,800
1,800
0)
31,227
230,600
23,000
0)
33,000
3 22,000
18,300
736, 757
1,191 649,885
77 708,810
0)
34,835
38,438
p42,026
37,261
31,563
27,097
38,186
24,316
(0
i* 112
7,414
3,700
«17,712
17,314
» 1,177
1,177
90,000
60,000
118,500
0)
1,706
<*)
1*5,649
5,649
75,000
71,000
49,876
Agricul
tural
Other
33,923,166 1,487,877
9.007.088 1.006,437
20.954,624 195,989
3,961,454 285,451
1,797,703
195,989
4,906
0)
* 410,000
0)
403,000
0)
211, 374
0)
*243,734
0)
138,444
0)
6,898 176,977
114.924 * 250. 451
58,771 191,929
52,965 140,125
786,564
0)
*100,300 *1,216,814
»* 300,000
0)
569,537 658,795
584,258 n 749,946
570,129 482.342
37.234
30,831
30.000
56,370
295,124
0)
156.773
0)
70,675 “ 205,400
*52,000
0)
5,123,199
1,000,000 <1,319,643
1,000,000
5,000
(i\
2,373,120
1,320,452
0)
i» 441,875
0)
291,732
1,616
294,000
ri
290,617
M
43,979
0)
56,989
i» 125,000
110,462
110,462 7190,000
65,565 7190,000
<i)
0)
69,082
102,423
957,000
7635, 507
635,507
18,538
21,194
54,030
“ 35,862
* 29,912
12,136
16,661
** 52,296
» 50,575
407,169
0)
“ 65,000
<4
•466
0)
31,907
35,000
43,706
11,037
125,839
122,445
93,237
* 6,553
1,876
2,054
w2,453
26,884
Development and Characteristics
T a b l e 2.— M em bership o f European Cooperatives, b y Country and T yp e o f Association —
Continued
Country
Norway _
Poland..
Portugal_____
Rumania........
Soviet Union.
Spain.............. .
Sweden_____
Switzerland .
Yugoslavia..
Consum
ers'
Year
All types
1939
1939
1936
1931
1937
1934
1929
1938
1937
1930
1937
1935
1930
1926
1937
1934
1942
1937
1942
1937
1937
1936
1931
584,579 24 196,234
412,672
3,122, 296
2,959, 518
353,000
825.887
1,895,984
19,000
19,000
15,000
19,000
34,000
76, 214
1,453,127
154,735
1,398,382
329,063
289, 961
1, 579, 089
60,759,892 39,200,000
57,870,400 41,000,000
62,414, 300 48,904, 200
19,129,033 11,401, 708
1,884,688 1,178,817
84,944
408,646
1, 717, 798
765, 700
1, 337,132
660,934
1,084, 214 »8 461, 000
418, 557
1,032, 210
1,105,698
86,983
288,305
933, 384
59, 302
855,836
Credit
1*1540961
1, 544,000
(1
08)
1
9
8
*7
4
3
2
1,120,130
1,102,841
1,003,082
_____
24 111, 100
93,200
253, 214
145,909
499,856
2496,646
(28)
Workers'
produc
tive and
labor
Hous
ing
Agricul
tural
2 4 ,452
382,293
2 1,600
“ 5,876 “ 23, 367 i* 1,107, 128
2 1, 518
27,000
974 000
“ 9,632 1*1,060,465
0
0
4,000
(»)
74,000
57,686
22,209
» 244, 269
201,
360
0)
2, 402,971
19,156,921
0
72,002,000 3,360,000 i« 11, 508,100
2,002,000
19 11, 508,100
0
589,173
7,138,152
0)
79, 617
63, 566
400,688
3,432
56,418
208, 286
« 7,882 i* 40,000
i* 535,116
7,882
535,116
40,000
i* 467, 744
0
467,
744
0
9,279
18, 962
385, 012
*6,272
280,172
21, 073
(28)
(28)
(28)
Other
32,292
60,000
('S
42,414
46,676
84,686
162,000
55, 566
258,000
0
105, 606
260, 916
796, 534
1 No data.
2 Data relate to 1934.
3 Some associations included with agricultural.
4 Data relate to 1935.
* Data relate to 1936.
•Data relate to 1933.
7Data relate to 1930.
8Some included with “other.0
9Includes some agricultural membership.
10 Data relate to 1929.
11 Figures not strictly comparable with other years: classification changed in official statistics.
13 Data relate to 1937.
13 Data relate to 1931.
14 Dairies only.
38Agricultural credit associations only.
18 Data relate only to associations affiliated with central organizations.
17 Data relate U 1932.
18Includes some credit membership.
19 Data relate to 1928.
20 Data relate to 1924.
21 Includes some consumers' membership.
22 No data; probably included with agricultural.
28 Probably includes consumers' membership.
24 Data relate to 1941.
28 Included with agricultural.
28 Included with “other."
Naturally, the relative strength of the consumers, cooperatives was
greatest in the industrial countries (as in Belgium, Great Britain, and
Switzerland), and that of the agricultural associations in nations
where the economy was still rural (Latvia, Ireland). Finland and
Hungary, largely agricultural, were exceptions; there the consumed
cooperatives’ members (many of whom were farmers) exceeded those
of the agricultural marketing and processing associations. In France,
Italy, Sweden, and Switzerland, cooperative membership was about
equally divided between consumers’ and agricultural cooperatives.
Notwithstanding the State’s absorption of the urban consumers’
cooperatives in 1935 in the Soviet Union, the membership of the con
sumers’ cooperatives there far outstripped that of the agricultural
cooperatives. Cooperative credit predominated in such countries as
Bulgaria, Czechoslovakia, Estonia, Greece, Latvia, Lithuania, Ru
mania, and Yugoslavia. Relatively even development among the
three main branches of cooperation— consumers’ , credit, and agricul
tural— had taken place in the Netherlands. The same was true in
588544*— 44------ 2
10
Comparative A nalysis
Germany in 1937, but this had resulted from the losses sustained by
the consumers, associations under the antagonism of the Nazis and
the gains made by the agricultural associations which were in official
favor or at least unhindered.
Workers’ productive and labor-contracting associations accounted
for a substantial part of the total number of cooperators only in
Bulgaria. Even in other countries where they can be said to have
attained a fair degree of success (France, Italy, Soviet Union), their
membership never attained the level of 10 percent of the total.
Most of these types of associations should prove useful in the post
war reconstruction work— the consumers’ associations in the distribu
tion of food and household necessaries, the agricultural associations
in the inauguration of farming activities in devastated regions, and
in other countries in the collection, processing, and marketing of the
crops. Certain special types of cooperatives, described in succeeding
pages, might also be utilized.
ORGANIZATIONS FOR SOCIAL WELFARE
Medical care and sanitation.— In Belgium, “ La PrSvoyance,” an
insurance association at Brussels serving the consumers’ cooperative
movement, maintained three welfare establishments— one for con
valescent adults, and the others giving medical care to children having
or threatened with tuberculosis. At all of these it had laboratories
working in preventive medicine. In addition it had a 125-bed sani
tarium for men with tuberculosis, and 4 medical advisory centers open
to the general public as well as members.
One large Czechoslovak association ran a home at which invalid
children were given free care. Since 1904 the cooperative associations
in Denmark had had a cooperative sanitarium at Skive, to which over
1,000 associations with nearly 360,000 members were affiliated.
In France the experience gained by cooperatives after the first
World War should be of assistance in the present time. Refuges for
care of orphan children were established at that time by individual
associations, leading later to the formation of a central association,
“ L ’ Enfance Cooperative,” at Paris, for operating holiday homes. In
addition it had a 100-bed tuberculosis sanitarium, open all year, for
the treatment of children. In recent years the accommodations of
this association have been opened to Spanish refugee children and
children evacuated from areas of political and military conflict. Its
facilities were also utilized by the public health authorities and others.
The Cooperative Union of Paris had a medical, dental, and surgical
clinic and a pharmacy, and the regional association at Limoges was,
just before the outbreak of war, converting its vacation home into a
sanitarium for preventive care against tuberculosis.
“ De Volharding” at the Hague— the second largest distributive
cooperative in the Netherlands— had a sick-fund and medical-care
department with 82,000 members and had since 1939 operated its own
hospital. The sick-fund associations throughout Holland, many of
which were connected with consumers’ cooperatives, had their own
drug association, “ Copharma,” through which their medical supplies
were purchased.
In Poland a number of cooperative health associations had been
established, each of which served an area of 6 to 10 villages and had
Development and Characteristics
11
its own dispensary, a full-time physician, and sometimes a midwife.
The physician, in addition to his regular duties, gave advice on infant
care, housing conditions, and personal and social hygiene. In some
cases associations arranged for a weekly dental clinic.
The health and sanitation cooperatives in Yugoslavia were started
as an outgrowth of American relief work after the end of the first
World War, as an aid in improving the appalling conditions in rural
areas. The work of these associations has been of three types:
Curative medicine, preventive and social medicine, and rural sanita
tion work. The headquarters of these organizations had a staff of
physician and nurse or midwife, and provided consulting-room,
dispensary, lecture-room, and bed facilities. By 1937 there were 171
of these associations, with nearly 111,000 members. They had their
own federation, started in 1922, which in 1938 organized a traveling
dental clinic. A wide range of educational work in social hygiene,
measures to prevent disease, and rural sanitation was carried on, en
listing the interest not only of members but of whole villages.
Among the Axis and satellite nations, only Bulgaria and Hungary
had associations in this field. In Bulgaria at the end of 1939 there
were 30 associations with 16,616 members, classified in the official
statistics as engaged in “ health and public works activities." In 1934
a cooperative hospital was opened in Burgas on the Black Sea. This
hospital represented the joint effort of cooperative associations of
various kinds, individuals (including doctors), and even the city and
national governments. Its success led to numerous others, and in
1935 a law was passed setting standards for medical-care cooperatives.
In Hungary the cooperative wholesale (“ Hangya,,) and the Central
Institute of Cooperative Credit had established a modern cooperative
hospital in Budapest in 1922. This hospital was enlarged in 1938.
General weljare activities.— The Belgian cooperative movement was
outstanding for its interest in social welfare. A large share of the
workers' cooperative associations' earnings was used to provide social
and recreational facilities for the community as well as the members.
The so-called “ peoples' houses" (maisons du peuple) of Belgium were
known the world over. Probably nowhere have the cooperative
associations done more to improve the moral, cultural, and social, as
well as the economic, status of the members. This was especially true
o f the associations formed by the industrial workers, which were early
advocates of general manhood suffrage and also supported trade-union
movements to improve working conditions.
Cooperative associations in Czechoslovakia also had numerous
“ people's houses."
The Cooperative Union of Paris, “ L'Enfance Cooperative" (previ
ously mentioned), and the Cooperative Union of the Somme had
holiday accommodations for between 6,000 and 7,000 children, which
could undoubtedly be utilized (if still intact) as sanitariums for nursing
back to health the children undernourished because of war conditions.
The same use might also be made of the orphanage and the aged
members' home run by the national federation of workers' productive
associations in France.
Of Yugoslav cooperatives it was said that all were interested in
cultural and welfare activities. Examples were the vacation report of
the Railwayman's Cooperative Association and the day nurseries run
by one o f the large credit associations.
12
Comparative Analysis
Among the Axis countries cooperatives in Bulgaria and Germany
showed some activity in the welfare field. In Bulgaria the Coopera
tive Savings Insurance Society of Bulgarian Civil Servants— the
largest cooperative insurance association in the country— carried on
extensive welfare activities, including the operation of holiday homes
and provision of medical care for its members, as well as a laboratory
for chemical research. The consumers’ cooperatives of Germany
devoted part of their surplus earnings to such welfare purposes as
burial funds, convalescent and holiday homes, and unemployment
relief. The cooperative wholesale (G. E. G.), and the cooperative
association of Hamburg each had a holiday home; in these two resorts
210 persons could be accommodated at a time. There was at Jena a
special holiday cooperative which ran 12 summer vacation places.
In view of the dissolution of the consumer’ cooperatives in Germany
it is doubtful that these facilities are still in cooperative possession.
HOUSING AND CONSTRUCTION ASSOCIATIONS
Among the most helpful associations n the devastated areas should
be the housing associations, already versed in the techniques of
apartment-building and house construction and other problems en
countered in connection therewith. The accompanying statement
shows, for such countries as information is available, the number and
membership of the housing associations in 1937.
Occupied countries:
Belgium____________________________________
Czechoslovakia_____________________________
Greece________________ __________ ____ _____
Netherlands________________________________
Norway 4___________________________________
Poland____________________________________
Allied or neutral countries:
Great Britain______________________________
Sweden____________________________________
Switzerland________ ________________________
Axis countries:
Austria_____________________________________
Germany__________________________________
Hungary___________________________________
Italy............. ...................................... .......................
Number oj
aesociationt
.
1 125
.. 1 ,3 4 0
.
3 946
414
10
.
330
Member*
71 , 9 0 9
<*)
(J)
1, 6 0 0
23, 3 6 7
.
.
.
356
1 ,0 0 0
251
38, 4 3 8
40, 0 0 0
.
.
.
-
290
3 ,4 5 2
« 105
1 ,2 0 4
38 , 711
73 6, 7 5 7
<*)
75, 0 0 0
ft
1Data relate to 1938
* No data.
1 Data relate to 1936 and include building and loan associations.
4Data relate to 1934.
•Data relate to 1935
Statistics published by the Czechoslovak Government for 1924
showed that the 787 reporting cooperative housing associations (of
1,418 in existence) had constructed 24,365 dwellings. In Denmark,
cooperative credit associations and the Government participated with
the housing associations themselves, in the financing of residential
building. In 1937 the 17 housing associations (with about 13,000
members) belonging to the Danish Federation of Workers’ Coopera
tive Building and Housing Associations constructed dwellings totaling
0,847,000 kroner in value. Aggregate income from the buildings con
trolled by all the associations amounted to 8,870,000 kroner for the
year. In Finland a central organization for housing construction,
“ Haka,” was formed by joint action of the consumers’ cooperative
Development and Characteristics
13
association of Helsinki, one of the cooperative wholesales, and an
organization for the improvement of housing.
Such housing associations as existed in France were of the savings
and loan type, financing construction rather than undertaking it
themselves. In May 1935 there were 460 associations of this kind.
Most of the associations in Great Britain were also of this type; of
1,333 associations, in 1937, this group accounted for 977. Also, the
associations that constructed housing were for the most part only
semicooperative. However, the dwellings built by them included a
considerable number erected by retail cooperatives of the consumers'
movement, which used their surplus funds for this purpose.
Prior to the rise of National Socialism in Germany, cooperative
building associations were of considerable significance there. In 1927,
for example, they accounted for 78,426, or 28 percent of all dwellings
constructed in Germany, and for over 68 percent of those erected
in Berlin. The central federation, “ Hansya,” in Hungary had con
structed numerous dwellings for its employees and emarged its ac
tivities in this field in 1938.
The more than a thousand housing associations that were in exis
tence in Poland in 1934 had erected buildings containing a total of
75,000 rooms. One of the largest associations was that at Warsaw
which had over 4,000 members, who were almost entirely wage earners
tad lower-salaried employees. In the 15 years of its existence it had,
by 1936, built 24 apartment houses with accommodations for 1,713
families.
Housing associations in Sweden were federated into a national
organization, known as the “ H. S. B .” It operated as a financial
center, as purchasing agency, and even as producer of building ma
terials. Local associations carried on actual construction of the build
ings, which were then turned over to tenants' associations to run. By
1937, 10 percent of the housing accommodations in Sweden had been
constructed by cooperative associations, which had done much to
improve building design and equipment and to lower prices.
Cooperative activity in Switzerland was also considerable and had
resulted in reducing rent levels somewhat. In five cities cooperatives
had built over 10,500 dwellings (including the community, Freidorf,
built by the Cooperative Association of Basel for its employees).
In Yugoslavia the large railwaymen's cooperative used its surplus
funds to finance the construction of houses for members.
Not to be disregarded as potential aids during the reconstruction
period are certain types of associations that functioned in France and
Greece for a considerable period after the end of the first World War.
In France the associations for the reconstruction of devastated areas
at one time numbered nearly 2,300 and had a membership of 162,000
families. Although doing no construction work themselves, they made
all the financial and contractual arrangements for repair and construc
tion. It was estimated that they handled about 27 percent of all
the repair work and 58 percent of all the construction work carried
out in the devastated districts and in some cases the proportion ran
as high as 76 percent. The Government of Greece, in order to care
for the flood of refugees into Greece from Turkey and southern
Russia and for persons involved in the population exchanges with
Bulgaria and Turkey, gave housing cooperatives certain privileges,
such as exemption from real-estate taxes and from import duties on
14
Comparative A nalysis
building materials. Resettlement cooperatives were also formed,
which received land from the Government, obtained by expropriation
of large estates. Such associations at the end of 1928 numbered 1,585;
they had a membership of 93,000 families and had taken possession
of over 1y2 million acres of land.
w orkers’
p r o d u c t iv e
and
labor
a s s o c ia t io n s
Difficulties of financing, of salesmanship, and of competing with
large-scale industry have been among the chief obstacles to the growth
of workers’ productive associations operating workshops or factories.
For these reasons such associations have ordinarily been most successful
(1) in the less-industrialized countries or those in which small-scalo
enterprise has predominated (such as France and U. S. S. R.), (2)
in those countries where their sales problem is minimized by virtue o f
the patronage of a well-organized consumers’ cooperative movement
which provides a known market (Czechoslovakia and Great Britain)
or by preference extended in contracts by a friendly government
(Italy, France), and (3) in those industries requiring relatively small
capital.
In no country has this branch of the movement attained a predomi
nant place in the whole cooperative movement. Nevertheless, in a
few these workers’ groups have attained considerable success, and
could be a real factor in the work of renewal, both of physical proper
ties and of goods after the war. In 1937, over 2% million workers
were members of these European industrial cooperatives, and their
skills covered a wide range.
TABLE 3.— M em bership and Business oj Workers’ Productive and Labor Associations,.
by Country 1937 1
Country
Num
ber of
associa
tions Members
report
ing
Amount of
business (in
Swiss gold
francs *)
All countries........
9,439 2,238,707
9,562,792,678
5,608
124,000
21,646
(<)
234
31,227
33,472
<«>
5,757,000
(<)
31.977.000
10.204.000
687,000
46.223.000
102,662,000
<9
Belgium...............
Bulgaria».............
Czechoslovakia..
Denmark.............
Estonia.................
France«................
Great Britain___
H ungary............
98
500
858
36
16
648
89
14
Country
Italy..... ................
KTAthorlan^Q
vvliC/i IcUlUd.
Poland.................
Rumania..............
Soviet Union___
Spain....................
Sweden.................
Switzerland_____
Yugoslavia...........
Num
ber of
Amount oi
associa Members business (in
tions
Swiss gold
report
francs *)
ing
86,500
1,568
17
(*)
5,876
155
11,152
95
1,882,350
4,555
670
32,804
2,882
27
67
(*)
956
36
88,550,000*
(4)
9.292.000
(*)
9,248,931,678
2.220.000
14,524,000
0)
1,765,000<
i Data (except for Bulgaria and Soviet Union) are from Cooperative Societies Throughout the World?
Numerical Data (International Labor Office, 1939), pp. 31, 32.
* Average exchange rate of Swiss gold franc in 1937=32.7 cents.
* Data relate to 1939.
<No data.
•Not including “ command ites” in printing industry.
These workers’ organizations are of two general types: Those
which have their own workshops and equipment; and the so-called
“ labor associations” which carry on a contracting business in various
lines of work. The workers’ productive associations in Belgium were
mainly in the printing trade, though there were others scattered
through the brewing, construction, and tanning industries, and the
manufacture of glass, cigars, shoes, and enameled ware. Most of
Development and Characteristics
15
the cooperative labor associations of Belgium were those of dock
workers. The associations in Czechoslovakia were engaged in vari
ous pursuits— in the operation of transport facilities, theaters, and
movies, in the printing industry, and in the manufacture of bakery
products, meat products, flour, clothing, footwear, stone and glass
products, toys, baskets, wooden articles, artificial limbs and paper.
In France the workers’ productive associations were engaged in
extraction of minerals, stone, etc.; printing; manufacture of textiles,
clothing, leather, stone, clay, and glass products, chemicals, paper,
and jewelry; metallurgy; woodworking; construction and public
works; transportation; and the practice of liberal professions. Perhaps
the best known of the workers’ productive associations in France—
or indeed, in the world— was La Familist&re, an iron-foundry asso
ciation engaged mainly in the production of stoves, at Guise. Nearly
destroyed in the first World War, it may also have suffered during
the German invasion of northern France in 1940.
The small number of workers’ productive associations in Great
Britain are for the most part making clothing or footwear or operating
printing plants, their chief market in many cases being the con
sumers’ cooperative movement.
Over a sixth of the total number of cooperative associations in
Greece in 1936 were classed as workers’ productives and labor associa
tions. The latter consisted of associations of porters and stevedores
working in the coastal cities. The former were (like most of the
German associations of the pre-Nazi period) marketing or supply asso
ciations for independent handicraftsmen in various trades— tailoring,
shoemaking, baking, etc.
In Hungary the workers’ productive associations were found in
woodworking, building construction, shoemaking, tailoring, and vari
ous home industries. The labor associations were engaged mainly
in flood control, irrigation work, and road construction.
Italy presented one of the few outstandingly successful examples of
both cooperative workshops and labor cooperatives. The former
were found in such industries as printing, mosaic, woodcarving, bridge
and ship building, shoemaking, and tailoring; and the latter in long
shore work, farming, road construction, building construction, drain
age projects, and various other types of public works. Two of the
country’s railroads were built and operated by worker groups. These
associations had had, for many years, preference in Government con
tracts— a policy which seems to have been continued by the Fascists.
The workers’ cooperatives (“ artels” ) in the Soviet Union have been
encouraged to the greatest extent by the Government, under the vari
ous 5-year plans, and have played a substantial part in industrial pro
duction. Even as late as 1938, these industrial cooperatives were
producing about 20 percent of the total output of consumer goods in
the country. In certain lines the proportion ran considerably higher:
Piece goods, 33 percent; furniture and felt footwear, 35 percent; metal
goods, 42 percent; metal beds, 65 percent; notions, 80 percent. Cer
tain commodities— embroideries, toys, musical instruments, and
kerosene burners— were produced entirely by the artels.
The workers’ productive associations in the rural areas of Rumania
quarried stone and mined coal; those in the urban areas operated
printing plants, tanneries, and textile-weaving mills.
16
Comparative A n alysis
OTHER ASSOCIATIONS
The services of certain other special types of cooperatives might be
utilized in the work of rebuilding the economy m the devastated
regions. Among these may be noted the following: For the com
munal feeding programs that will be necessary in the period im
mediately following liberation in each country the experience of the
cooperative restaurants in Belgium, Finland, and Sweden, the
“ canteens” of Denmark, and the “ cooperative kitchens” and restau
rants in the Netherlands should be of service. Lumber might be
obtained from the forestry associations in Bulgaria, Finland, and
Rumania; and fish from the fishermen’s associations in Great Britain,
Greece, Italy, Latvia, Norway, Spain, Sweden, and Yugoslavia.
Before the war, cooperatives distributed electric power in Czecho
slovakia, Denmark, Estonia, Finland, France, and Yugoslavia (as
also in certain still free countries, such as Sweden and Switzerland).
In Finland where telephone service was also provided cooperatively,
the farmers’ cooperative wholesale, “ Hankkija,” was recognized as
the leading enterprise in electrification work and in the installation
of telephone equipment. Hungary had cooperatives carrying on a
transport business, and one mining association.
The farmers in the various countries also had cooperatives of many
•types, in addition to the usual processing and marketing of farm prod
ucts and purchasing of farm supplies. In Belgium the Belgische
Boerenbond opera tea a chain of retail stores and bakeries. In Czecho
slovakia the farmers ran flour mills, bakeries, fruit and vegetable
canneries, chicory works, and starch factories, as well as associations
for the joint leasing and cultivation of land and joint use of farm
machinery Except for the land associations, farmers’ cooperatives
in France and Switzerland were in similar fields. Dairy associations
were of especial importance in the agricultural cooperative movement
of Estonia, Finland, Norway, Sweden, and Switzerland. In Denmark,
Finland, Netherlands, Norway, and Sweden, practically every phase
of agriculture had its marketing and purchasing cooperatives, oper
ating in foreign as Well as domestic markets.
Rural cooperatives were even more varied in Bulgaria. That
country had in addition to the usual processing, marketing, and
supply associations, cooperatives of cocoon growers and forest
owners, collective-farming organizations, associations distilling ^attar
of roses, and “ river” associations carrying on irrigation, drainage,
flood control, electricity generation and distribution, and extraction
of salt from the sea. In Rumania there were land-leasing and cultiva
tion associations, forestry associations, and organizations quarrying
stone and mining coal.
Consumers9 Cooperative M ovem ent
CHARACTERISTICS OF THE MOVEMENT
Goods and services provided— In general, the European distributive
associations tended to deal in groceries and household supplies.
Extreme variety of type characterized the consumers' cooperatives in
countries where organizations usually carried on a limited range of
activities and where a new association was formed for each new
avenue of activity. In many cases, on the other hand, where the
Development and Characteristics
17
consumers’ cooperatives were of the usual standard types, the retail
associations operated in a wide variety of lines. Thus, in France
where there still remained many small associations dealing in a single
commodity, such as bread, there were also large district associations
operating not only grocery stores, bakeries, and restaurants, but even
drug stores and department stores. The same is true in Great
Britain to an even greater extent; in that country the retail coopera
tives also provide services of various kinds, such as medical, dental,
and optical care, beauty service, burial, laundering, auto repair,
house decoration, and meals.
Finnish and Lithuanian distributive cooperatives usually were of
the “ general store” type, providing a wide range of commodities in a
single shop. Some Finnish stores were reported to carry as many as
5,000 items of merchandise. In Germany and Sweden, on the other
hand, the majority of associations tended to concentrate on food
stuffs, although some also sold dry goods, housefurnishings, etc.
Religious and political aspects— Typical of many countries were
the cleavages along religious (Belgium, Netherlands, and Spain),
political (Belgium, Czechoslovakia, Finland, and Netherlands), and
social lines (Hungary). Nationality divisions were also common,
especially in eastern Europe where nations had been pieced together,
after the first World War, from territories previously under the rule
of adjoining countries (Poland, Rumania, Yugoslavia). Such differ
ences did not necessarily mean disharmony. In some countries the
various branches were on friendly terms and combined forces on
occasion (Czechoslovakia, Hungary). In others (as in Poland),
although there were groups of associations whose members were
exclusively of a single political or religious belief, they were affiliated
with the general national movement. In at least one country (Bel
gium), however, there was active antagonism among the various
factions. One of the noteworthy features of the cooperative move
ment in Czechoslovakia was the warm friendship between the German
and Czechoslovakia branches of the cooperative movement, which
continued even after the beginning of the Pan-German movement
initiated by the Nazis and until the dismemberment of the country.
Rumania contained a movement organized almost entirely on
nationality lines, but compelled by Government decree to belong, to
a single structure culminating in a State department. Membership
in a general federation was also compulsory by law, in Yugoslavia.
The Finnish distributive movement was divided into two c^mps—
the cooperatives of urban, progressive, industrial workers, and those
of the rural, conservative, agricultural groups. Between them
existed no special antagonism; neither does there appear to have been
collaboration.
In spite of differences in language, political preference, and religious
belief in some countries, the consumers’ cooperative movement had
in many cases succeeded in becoming unified and well-integrated
throughout the entire nation. National federations had been formed,
for educational and commercial activities, to which all or a prepon
derant proportion of the entire movement was affiliated. This was
the situation in Austria (before the Anschluss), Bulgaria, Estonia,
France, Great Britain, Hungary, Lithuania, Norway, Poland, Sweden,,
Switzerland, and Yugoslavia. In most of these the national federa
tion pursued a policy of religious and political neutrality. This latter
18
Comparative Analysis
did not, however, preclude action by the movement to protect itself
against legislative attack; political “ neutrality” meant that the
movement did not identify itself with any existing political party.
Cooperative movement in relation to the State.— In its attitude to and
relations with the Government, the consumers’ cooperative movement,
just prior to the present war, varied from (1) uncompromising selfreliance (as in Great Britain, Netherlands, Norway, Sweden, and
Switzerland) through (2) participation with the Government, on
equal terms, in various enterprises which were generally undertaken
as expedients for improving the general economic situation (preAnschluss Austria, Hungary, Latvia, Lithuania) (3), through varying
degrees of government assistance (usually credit, in the form of
long-term loans,5 as in France), to (4) extreme dependence on Govern
ments which were continually intervening in the affairs of the move
ment (Bulgaria, Rumania).
The attitude of the Governments, on their part, ranged from—
(1) Open hostility (National-Socialist Austria, Germany), through—
(2) Apparent indifference or a hands-off policy (Belgium, Great
Britain, Netherlands, Switzerland) to—
(3) Active interest manifested through—
(а) Strict control (Latvia, Lithuania).
(б) Granting of monopolies in certain lines to cooperatives
(Estonia, Latvia).
(c) Extension of credit or outright subsidies (France, Rumania).
(d) Special Government offices to regulate, direct, or promote
cooperative activities (Czechoslovakia, Estonia, France,
Rumania).
(e) Establishment of cooperative training schools (Bulgaria,
Rumania) or introduction of cooperative courses in the
schools or colleges (France, Poland, Rumania).
(/) Public expressions of appreciation on the part of Government
officials (Czechoslovakia, Hungary, Sweden).
(g) Extension to cooperatives of representation on various Gov
ernment regulatory or administrative bodies (Bulgaria,
Czechoslovakia, France. Hungary, Lithuania).
Since the Bolshevik Revolution in Russia, the attitude of the au
thorities there has ranged from (1) extreme favor that gave the move
ment the status of a Government enterprise, membership in which
was made compulsory (1919-23), (2) restoration of voluntary mem
bership (1924) but with operation under Communist control, to (3)
absorption of urban cooperatives into the State store system (1935),
but encouragement of the rural consumers’ cooperatives and other
forms of cooperative effort (1935-44).
Consumers’ Cooperative M ovem ent D uring and Im m ediately A fter
the Depression
The impact of the depression and post-depression years was felt
by European cooperatives in several ways: In the decreased volume*1
4 In Great Britain the movement has its own political entity, The Cooperative Party.
1It should be pointed out that in most countries where this was the situation, similar credit was also
accorded to other forms of business enterprise—and often on a much wider and more liberal scale. Among the
branches of the cooperative movement, also, it was generally the credit and agricultural associations (rather
than the consumers* cooperatives) that were accorded Government credit.
Development and Characteristics
19
of trade caused by the diminished purchasing power of the members,
who were largely industrial workers or agriculturalists; in the increased
attacks by private business, resulting in efforts to prevent further
expansion of cooperatives and to restrict their activities through
either general legislation or measures aimed solely at cooperatives;
and in the hampering effects of measures adopted by the Governments
in their effort to adjust to worldwide conditions of commerce and trade.
The trend toward curbs upon the cooperative movement was inten
sified as the corporative type of government began to be introduced
in one country after another, under the influences of a complicated
set of domestic and world events and factors.
ATTACKS UPON THE MOVEMENT
The private traders’ attacks generally followed a similar pattern in
all countries. The cooperatives were accused of being the recipients
of special favors from the Government (notably in the matter of tax
exemption); and their patronage refunds were declared to be an unfair
trade practice. On the basis of these charges legislation was sponsored,
the purpose of which was usually declared to be to “ place cooperatives
on the same footing as private business.” In Finland the retail
dealers had adopted the cooperatives’ technique and had established
wholesale cooperatives of their own, and it was through these organ
izations, ironically enough, that the attacks against the consumers’
cooperatives were launched.
The measures proposed ranged from mild curbs upon the expansion
o f the movement to its entire dissolution or to imposition of taxes
frankly designed to put the cooperatives out of business.
In reply to the charges made, the consumers’ cooperatives pointed
out that they paid the usual business and real-estate taxes and license
fees, that generally the only exemptions they enjoyed were on the
surplus earnings returned to members on patronage; and that these
could not properly be regarded as on the same basis as “ profits,” being
merely the overcharge advanced by the members to insure the
financial safety of the enterprise. In some countries (as in Belgium
and France) some difficulty was experienced in driving home this
latter point, because of the fact that the cooperative law was so loosely
drawn that profit-making businesses could and did incorporate under
it. Where cooperatives had exemption on amounts disbursed for
social-welfare purposes (pensions, hospitals, holiday homes, etc.), the
same also held true for similar expenditures by private business.
For the most part the more drastic legislative restrictions attempted
were defeated by the cooperatives (Denmark and Finland), though
often only by concerted effort of the various branches of the move
ment (Netherlands), or with the support of the trade-unions (Bel
gium) or the liberal political parties (Czechoslovakia). Opponents
were, however, successful in obtaining certain restrictions in Austria
(by compromise, the associations agreed to discontinue production of
textiles and not to attempt any further expansion of membership), in
France (a special tax on all cooperative sales, and cancellation of the
exemption on expenditure for social welfare), in Switzerland (limita
tion of opening of branch stores, and special taxation—also levied on
chain stores), and in the Netherlands (limitation on opening of new
enterprises, but cooperatives were given representation on the deter
mining committee).
20
Comparative A n alysis
It may be noted that in Germany and, later, Austria, the drasticmeasures against consumers, cooperatives that were inaugurated,
immediately after the assumption of power by the National Socialists—
finally ending in the wiping out of the entire consumers' cooperative
movement—were manifestations of the Nazi policy of favor toward
the small shopkeepers.
In most of the above cases, the attacks occurred in democratic
countries having governments responsive to pressure groups but
where the weight of the cooperative movement could also make itself
felt. Where restrictions were finally imposed, these were ordinarily
far less onerous than the original proposals. In the dictatorships or
those countries in which the totalitarian state was rapidly being
inaugurated (Bulgaria, Estonia, Italy, Latvia) the entire cooperative
movement was subjected to the will of an unresponsive authority
which in some cases favored it, but in all cases had complete control.
In some countries the merchants' attacks not only failed to harm
the movement in any serious way, but brought about closer relation
ships among the various branches of the movement (Belgium and
France) and redounded to its benefit in other ways. Thus, in Czecho
slovakia the attendant publicity even resulted in a substantial increase
in membership. In France a signal victory was achieved in the
passage of a law, advocated for many years, setting cooperative
standards and restricting the use of the word “ cooperative" to organ
izations meeting these standards. The various branches of the
movement in the Netherlands—neutral workers' federation. Catholic
cooperatives, and agricultural associations— had always had very
friendly relations. The merchants' attacks resulted in bringing them
even closer, in the formation of a council for defense on which all
groups were represented, in the undertaking of a 5-year plan for
informing the public regarding the movement and for the better
education of cooperators, and in the formation by the consumers' and
agricultural cooperatives of a jointly operated chain of green-grocery
stores throughout the Netherlands.
DEPRESSION EFFECTS UPON TRADE AND MEMBERSHIP
Cooperatives came through the depression fairly well. In general
they were able to resist depression conditions in proportion to their
financial resources and the degree of coordination of the various parts
of the movement. Those countries the economy of which was largely
dependent upon foreign trade were among the first to suffer, the shock
being quickly communicated to industry or agriculture or both,
depending upon the type of the country's exports and imports.
The Belgian cooperative movement, although it had not regained
its predepression level, had undergone a drastic structural reorganiza
tion and integration designed to put it on a much firmer basis finan
cially. By this action the consumers' cooperative movement of
Belgium had become (with the possible exception of Rumania ®) the
most strongly centralized of all Europe. Rapid progress had already
begun under the new plan, when the present war broke out.
The consumers' cooperative movement in France had through many
years' consolidation of associations, attained a stability that enabled•
•In Rumania, however, the centralization was forced by the Government, not voted by the cooperatora
themselves.
Development and Characteristics
21
it to hold its own remarkably well during the early years of the
depression. Beginning in 1933, however, it suffered a severe blow
with the sudden failure of the Cooperative Bank, whose obligations
were thereupon assumed by the cooperative movement. As a result
of all this and the other economic effects of depression a general
reorganization of the whole consumers' network was voted, providing
for greater mutual assistance and bestowing added authority on the
central organizations.
In the Netherlands, although the depression was severe and was
greatly felt by the working-class membership, one organization was
formed to give technical aid to associations in difficulties and another
to lend financial assistance. Sales of local associations declined year
by year throughout the depression, until 1936, when a sharply upward
trend began. Such was the loyalty of the local associations, however,
that the sales of the wholesale rose without a break throughout the
entire depression period.
The Norwegian consumers' cooperative movement not only held
its own throughout this period but advanced, each year showing
higher trade levels.
Polish cooperatives had recovered from the depression by 1933 and
consumers' and agricultural cooperatives were making rapid progress.
In Czechoslovakia where depression conditions (especially in the
Sudeten area, where the German branch of the movement was con
centrated) continued through 1936, both the German and Czecho
slovakian branches of the movement had overcome the effects of the
depression and were well on the upgrade by the end of 1935.
In Sweden, where there was a systematic policy of amalgamation of
small associations into larger and more stable organizations and where
ailing associations were taken in hand and set on their feet, the coop
erative movement came through the depression without serious mis
hap. The sales of both the retail associations and the wholesale rose
uninterruptedly during the whole depression period. The associa
tions in S w i t z e r l a n d were almost as fortunate, sustaining only
alight reductions about 1932 and 1933.
In the Baltic countries the trend toward the corporative State came
early, dating in Lithuania from 1926, when a single-party dictatorship
came into power. Similar systems followed in Estonia in 1933 and
Latvia in 1934. With these changes came complete government con
trol over the cooperatives, which had been severely affected by the
depression (in Estonia by 1934 the number of associations and mem
bership had dropped to an all-time low and many of the associations
were saved only through timely assistance from the cooperative whole
sale). Along with control also came favors; cooperatives were in some
cases given export monopolies (Estonia, Latvia) and allowed to partic
ipate m many ways in the Government’s system of economic control.
In Latvia, however, this entailed a complete reorganization forced by
the Government and conformity to the new ideology.
Somewhat similar circumstances were found in most of the countries
that later threw in their lot with Germany, and cooperatives were of
course affected by the measures adopted by the New Order. In
Italy the cooperatives had been incorporated into the Fascist system
soon after the rise of Mussolini.
The depression was unusually severe in Austria, but the coopera
tives withstood the situation during the first few years better than did
22
Comparative Analysis
private business, although volume of business receded. After the
c r i si s of 1933 and the beginning of th* authoritarian s y s t e m
cooperatives felt more and more the iron hand of the authorities,
losing the Labor Bank and being themselves placed under Govern
ment administrators and obliged to become members of corporative
organizations created by the Government for the various branches
of trade and industry. This crisis was surmounted and Government
administration was withdrawn in 1935, after which the movement
(retail and wholesale) began to advance again. This progress was
terminated abruptly with the German invasion in 1938. From that
time onward the only question was how long the movement could
delay the ultimate aim of the Nazis—dissolution.
Unlike the situation in most other countries, the depression in
Germany had not been preceded by a period of prosperity, but was
the culmination of a long downhill slide in business and employment
that had begun in 1923. During this time cooperatives had been sin
gled out for special taxation in many German States and municipalities,
which seriously reduced their earning power and the benefits they
could return to their worker members. When Government credit
was made available for business, cooperatives were again victims of
discrimination. In 1933 Hitler came to power. During the succeed
ing years workers’ labor cooperatives disappeared entirely and in the
other branches of the cooperative movement drastic amalgamations
were forced. The consumers’ associations were especially singled out,
the largest associations being attacked first and the wholesales merged
into an association that did not even contain the word, cooperative.
During the next few years, however, the attitude not only of State
governments but also of the Central Government showed extreme
variation. Agricultural cooperatives, alone, were consistently en
couraged.
Although drastic reorganizations in the cooperative movement were
carried out by Government order in Hungary and Rumania, some
degree of friendliness was also shown. In Hungary, the importance
of “ Hangya,” the national consumer-farmer cooperative wholesale,
was recognized; it was given representation on all the State-controlled
syndicates, and its facilities were utilized in many ways.
In Bulgaria, where the constitutional government was overthrown
early in 1934, the Government began to intervene more and more in
cooperative affairs. Nevertheless, all branches of the movement ex
panded up to the outbreak of war, and cooperators were even given
responsible posts in the Government.
Consumers’ Cooperation Just Before W orld W ar I I
RETAIL CONSUMERS’ COOPERATIVES
Table 4 shows, for 24 countries for which data are available, the
membership and business of retail consumers’ cooperatives before the
beginning of the war and in the latest year obtainable.
23
Development and Characteristics
T a b l e 4 .— M em bership and Business oj Retail Consumers’ Cooperatives, by Country
(For par values ol currency, see Appendix table, p. 278J
Year
Country
Austria __
___________ _
Belgium_______________________
Bulgaria_______________________
Czechoslovakia
Denmark . _
T
Estonia _
___
Finland ____
_
France_________________
_____
Germany . __ _
.
.
Great Britain_____„____________
Hungary __ _ _ _ _ _
Iceland_________________________
Irish Free State________________
Italy __ ______
Latvia.
_
_ _
__ ___
_
___
Lithuania______________________
Nether ands____________________
Norway.
_
Poland. __
__
_ ___
■Rumania
Spain _
__
__
___
Sweden
_
T
Switzerland.
Yugoslavia. __
__ ____
__ _ _ __
.
,_T,
___ _ _
___
_ _
1937
1936
1936
1937-38
1937
1936
1941
1937
1935
1937
1936
1935
1941
1937
1935
1940
1937
1935
1941
1937
1935
1937
1936
1935
1937
1936
1935
1943
1937
1935
1940
1936
1935
1942
1936
1935
1941
1936
1935
1938
1935
1938
1936
1939
1935
1939
1936
1935
1942
1937
1935
1939
1937
1935
1938
1934
1937
1934
1942
1937
1935
1942
1937
1935
1939
1935
Number
of asso
ciations
reporting
220
131
101
40
243
43
155
62
61
816
816
835
1,933
1,882
1,835
208
192
173
529.
537
528
1,235
1,200
1,064
1,162
1,162
1,169
‘ 1,058
1,094
1,098
2,094
1,480
1,489
* 48
37
37
20
21
22
3,865
3,465
184
112
185
165
351
419
398
673
585
524
1,776
1,500
1,391
2,791
1,767
1,803
272
676
702
725
546
540
535
*138
97
Business done
Number ol
members
Monetary unit
300,000
260,831
264,464
>305,197
500,000
346,568
104,992
75,000
69,000
805,544
644,400
642,700
419,200
366,100
319,000
(«)
47,000
35,478
676,000
562,298
517,355
1,800,000
1,600,000
1,6 8,359
2,010,900
2,094,500
3,121,839
9,028, 218
8,084,990
7,414,376
* 701,417
630,000
627,693
20,189
9,150
8,680
15,771
9,222
9,335
825,000
775,000
27,577
18,008
25,189
21,332
304,804
325,368
320,907
200,490
160,107
138,557
412, 762
325,000
311,000
154,735
257,907
1,178,817
79,814
765,700
605,796
568,161
461,000
413,715
402,339
90,672
72,327
146,000 nonpurchasing members were dropped from rolls in this year.
3 Data relate to 1936.
3 Data relate to 1939; affiliates of central organizations only.
* Data relate to 1939.
* No data.
* Data relate to 1942.
' Includes agricultural supply associations.
* Data relate to 1941.
* Data relate to 1937.
Schilling_______
........do..................
........do..................
Franc_____ _
........do . ...............
........do..................
Lev
........d o .................
........do..................
Franc..................
Koruna........ .......
........do..................
Krone..................
........do..................
........do..................
Kroon. _
........do..................
------ do..................
Markka________
........do..................
........do--------------Franc.
___
........do..................
........do..................
Reichsmark
........do......... ........
........do.............. .
Pound__ ______
........do.................
- . . . d o ..................
Pengo_________
— do..................
____ do..................
Krone _ ___ _ _
....... do..................
........do..................
Pound
........do..................
____ do..................
Lira
........do..................
Lat......................
____ do__________
Lit
........do..................
Florin
........do...................
........do..................
Krone
T, _
........do__________
....... do...................
Zloty _ _ __
........do..................
— do..................
Leu____________
........do..................
Franc _
Peseta_________
Krona
........do..................
........do..................
Franc „ _ ___
........do.... .............
........do..................
Dinar
........do_____ . . . . .
Amount
124,608,7001
118,063,603
115,200,000
663,073,337
650,000,000
728,709,299
J656,400,000
556,800,000
459,020, 700'
203,798,000
1,348,400,00)
1,299,100,000*
<361,500,000
328,700,000
286,003,800
50,000,000
45,500,000
26,332,009
<7,695,000,000
4,683,077,605
3,327,000,000
1,781,409,000
1,471,772,000
2,232,540,000
532,069,098
510,000,000
659,600,009
331,547,123
251,393,047
220,429,517
3 91,306,160
91,306,160
81,148,481
109,000,000
19,200,000
17,200,000
2,474,239
186,537
180,876
* 1,300,000,000
1,180,000,000
58,900,000
13,523,000
114,285,259
33,191,364
70,769,000
63,735,779
64,775,816
210,020,700'
168,253,500
129,769,600'
(*)
143,200,000
131,700,000
(«)
1,259,130,054
13,638,000*
90,863,000
731,000,000
488,740,957
412,177,962
406,100,000
299,251,995
274,200,381
283,887
206,311
24
Comparative A nalysis
WHOLESALE COOPERATIVES
In all of the countries of Europe, except Greece and Portugal, the
retail cooperatives had combined to establish wholesales through
which to obtain supplies of goods. The operations of these wholesales
in selected years (depression, pre-war, and war) are shown in table 5.
T a b l e 5.— M em bership and Business o f Cooperative Wholesales, by Country
Year
Country and wholesale
Austria? QoC____________________
Belgium: S. G. C ..............................
Bulgaria? Napred
_ _.
Czechoslovakia;
G .E . C . . . ...................................
V. D . P ........................................
Sdruzeni.......................................
Denmark: F. D . B............................
Estonia: E. T . K ...............................
Finland:
o t . ir
S. 0 . K .........................................
France _
Germany: G. E. G____ ____ _____
Great Britain:
English Wholesale _
_ __.
Scottish Wholesale.....................
English and Scottish Joint
Wholesale.
Hungary: Hangya.... ........................
Iceland? TTninn and Wholesale___
Ireland: L A. W
_
... ____
_
Italy: E. I. C. A _______ _________
Latvia:
Tnriha
Konzums.....................................
Lithuania: Lietukis _
_
Luxemburg: General Federation
Netherlands: Handelskamer______
Norway: N . K . L _____________ . . .
1937
1936
1933
1940
1937
1933
1942
1940
1933
Wholesale
Currency •
Amount of
business
Own produc
tion
131
131
143
*62
43
71
78
69
58
Schilling..............
........do..................
........do..................
Franc...................
........do............. .
........do..................
Lev
........do..................
........do..................
81,700,000
73,616,832
76,249,019
138,737,000
169,000,000
186,655,531
1,140,000,000
698,167,000
432,297,514
(0
*29,718,000
4,841,000
0)
27,000,000
28,095,091
0)
•117,433,998
37,000,000
1937
1936-36
1933
1940
1933
1937
1939
1937
1933
1942
1937
1933
140
*160
166
•301
331
131
1,870
1,900
1,833
7 208
192
184
Koruna...............
........do..................
........do__________
........do..................
........do..................
........do..................
Krone..................
........do..................
........do..................
Reich mark........
........do..................
........do..................
320,954,014
295,938,000
292,165,370
638,500,000
455,549,000
203,240,000
216,200,000
206,841,653
151,900,000
41,400,000
29,107,000
12,687,000
0)
57,268,000
53,005,470
• 172,421,000
136,974,659
0)
65,100,000
60,597,998
42,900,000
8,000,000
6,206,000
‘ 3,100,000
1942
1939
1933
1943
1939
1933
1939
1937
1933
1937
1936
1933
1943
1942
1939
1933
1943
1942
1939
1933
1942
1939
1933
<*>
127
109
0)
• 417
418
(>)
1,235
1,120
1,162
1,169
1,154
1,612,000,000
1,257,000,000
604,970, 281
2,153,000,000
1,646,000,000
914,571,571
1,276,899,000
1,066,021,394
893,878,615
330,009,321
309,999,304
279,940,844
239.600.000
243.300.000
82,035, 578
450,000,000
356,000,000
183,585,602
81,200,085
62,441,343
50,390, 293
120,608,663
107,581,300
108,000,000
7,544,315
157,395,338
125,015,316
83,031,390
35,778,000
34,044,052
24,612,711
16,016,361
9,429,000
8,400,000
15,975,552
0)
47,406,257
44,243,924
30,049,108
(*)
•9,816,972
7,132,330
5,361,493
230,000,000
80,053,757
43,230,547
69,000,000
8,500,000
721,806
241974
115,567,000
115,526,994
1180,000,000
1,350,000
138,911,000
73,710,000
28,716,000
27,792,000
28,118,700
21,431,000
53.162,000
54,105, 407
33,135,651
28,600,000
4,783,095
3,828,120
no, 000,000
1,589,199
1941
1937
1933
1942
1936
1942
1937
1937
1932
1938
1935
1939
1936
1937
1940
1937
1933
m i
1937
1933
See footnotes at end of table.
Number
of affili
ated asso
ciations
Markka
0)
•1,008
1,009
1,052
(l)
•221
227
241
2
2
2
........do..................
........do..................
____ d o.................
........do..................
Franc__________
........do..................
____ do..................
Reichsmark........
........do..................
........do..................
Pound
-------do...................
........do................ .
........do..................
........do..................
........do..................
........do..................
........do..................
........do..................
........do..................
do
1*1,887
1,480
1,541
•48
40
360
373
0)
251
1*414
223
145
108
(*)
*292
302
284
666
685
4*3
FengS..................
........do..................
------ do..................
Krone _
........do..................
Pound_________
........do...................
Lira......................
: . . . . do..................
Lat_____
........do..................
Lit
........do..................
Franc...................
Florin _
_ _
........do..................
........do..................
Krone................ .
........do...................
........do..................
(0
(0
(0
0)
(i)
i
*3,424,000
3,158,320
1,434,000
724,400,000
24,000,000
15,329,385
25
Development and Characteristics
T a b l e 5.— M em bership and Business o f Cooperative Wholesales, by Country— C on .
Poland ! Spolem.
Rumania: Hangya_______________
Soviet Union: Centrosoyns
Spain: C. C. A ..................................
Sweden: K . F_.
_ _ ___
Switzerland: Konkordia _
v. o.
l
. a ...................................
1939
1938
1933
1937
1935
1934
1933
1937
1941
1939
1933
1939-40
1937
1933
1938
1,776
1,800
794
325
315
(0
0)
1,200
706
693
763
p)
47
i* 52
329
1936
1933
1943
1939
1933
1937
1935
318
310
548
545
533
1,236
991
V. S. K .........................................
Yugoslavia,
* For par values, see p. 278.
* No data.
* Data relate to 1935.
* Data relate to 1938.
* Data relate to 1936.
Number
of affili
ated asso
ciations
Year
Country and wholesale
Whol<isale
Currency •
Amount of
business
Own produc
tion
Zloty .
... .
98,000,000
100,000,000
....... do..................
69,616, 646
Leu____________
121,000.000
........do..................
2,647,589
■Ruble
.... _ 14,910,000,000
........do.................. 14,154,400,000
Peseta..................
4,525,000
Krona
270,930,000
........do__________
269,350,000
........do..................
152,483,000
Frano. _
3,816,000
........do__________
3,340,000
........do..................
3,533,922
........do..................
43,000,000
........do..................
3 7 ,710,000
........do..................
3 9 ,822,864
........do.... .............
267 ,340 ,00 0
........do..................
227,869,001
........do..................
168,585,443
Dinar _________
5 7 ,846,000
........do............. .
37.166,955
(i)
10,000,000
5,130,937
(i)
590,469
(l)
(0
0)
10 14Q, 7 0 0 ,000
144,535,346
81,759,000
(*)
0)
h
1 ,500.000
(0
0)
0)
5 ,2 8 0 .1 5 2
1 ,8 86,338
Ci)
W
•Data relate to 1941.
i° Data relate to 1940.
« Estimated.
77 Includes agricultural,
u Data relate to 1932.
* Data relate to 1934-35.
• Data relate to 1937.
7Data relate to 1939.
»Data relate to 1934.
Place o f Cooperatives in the National Econom y
IM PO R TA NC E IN
TER M S OF P O PU L ATIO N
Before the outbreak of World War II, the members of the consumers, cooperatives accounted for 10 percent or more of the population
in Denmark, Finland, the British Isles, Soviet Union, and Sweden.
In the Soviet Union, where the urban cooperatives had been absorbed
into the system of State-owned stores in 1935, the membership of the
rural consumers’ cooperatives included nearly a third of the rural
population (table 6). Allowing for the families of cooperators, the
perceht of population served by the consumers’ cooperatives ranged
from 15.0 percent (Netherlands) to 34.0 percent (Sweden).
T a b l e 6.— Importance o f Consumers’ Cooperatives in Relation to Population , Just Prior
to Outbreak o f W ar
Cooperators
as percent
of popula
tion
Country
Consum ers' cooperatives
Based on members only:
Denmark........................................
F in la n d
Germany........................................
British Isles....................................
Latvia.............................................
L it h u a n ia .
Luxemburg.
_
_
......
N e t h e r la n d s .
. . .
Norway...........................................
R u m a n ia __________ _
_
_
Soviet Union___________________
Spain_________________________
S w eden
.
_
. _ .
Yugoslavia......................................
Including families also:
B e lg iu m _
C z e c h o s lo v a k ia
_
_
_____ ______
. . . _____
Denmark______________________
Germany_______ ________________
1 0 .0
1 6 .6
6 .0
18.1
1.4
.9
6 .5
3 .5
16 .7
.8
• 3 2 .1
4 .7
1 2 .0
1 .6
2 5 .0
3 0 .0
3 3 .3
2 4 .0
C onsum ers ’ cooperatives—Con.
Including families also—Con.
Hungary___________ ___________
N e t h e r la n d s __________ _______
N o r w a y _______
. ..
__
Sw eden
_ .......
_
_
_
Switzerland____________________
1 2 5 .0
1 5 .0
2 7 .0
3 4 .0
2 5 .0
A ll types o f associations
Based on members only:
B u lg a r ia . . . . . . . . .
N o r w a y . . . . . ___
R u m a n ia
___
. . .
1 5 .6
2 0 .0
7 3
.
Including families also:
E s t o n ia
F in la n d ... _
G reen e
H u n gary.
B o la n d
R u m a n ia
__
. . . ___ _...
_
Yugoslavia.....................................
7 Includes only associations affiliated to central organizations.
•Based on rural population; no consumers' cooperatives in urban areas.
5 8 8 5 4 4 °— 44-
Cooperators
as percent
of popula
tion
Country
5 0 .6
5 0 .0
2 0 .0
4 5 .0
4 0 .0
33. B
40. *♦
26
Comparative A n alysis
IM P O R TA N C E IN
TER M S O F T R A D E
Outstanding among the countries, as regards the proportion of
total retail trade done by cooperatives, were Bulgaria (25.0 percent),
Estonia (24.0 percent), and Finland (30.0-40.0 percent). As the
statement below indicates, the proportion of cooperative trade
ranged relatively high as regards specified commodities or lines of
trade. Perhaps the most striking instance is Lithuania, where the
supply or trading associations handled from 59.5 to 84.4 percent of
the total in various commodities just before the war.
In five countries (pre-Anschluss Austria, Bulgaria, Estonia, Hun
gary, Poland (“ Spolem” )) the central business organization of the
consumers' cooperative movement was the most important com
mercial enterprise in the country. In Sweden, the cooperative net
work was reported as being “ the only large-scale organization in the
distributive trade."
Cooperative
business as p e r
cent of * retail
trade
Cooperative
business as per
cent of retail
trade
Belgium: Total retail trade____ 10. 0
Bulgaria: Total retail trade____ 25. 0
Czechoslovakia :Total retail trade.
3. 8
Denmark: Total retail trade____ 17. 0
Estonia: Total retail trade____ 24. 0
Finland: Total retail trade 30.0-40.0
France: Groceries __________
6. 0
Germany: Total retail trade:
1931___ — ............................
5. 0
1935...............
2. 0
Great B ritain:1
Food and tobacco___________ 12.0
Meat__________________
Coal__________________
20. 0
Sugar and preserves_______ 27. 0
Hungary : Total retail trade____ 12. 5
Latvia: Food__________________
16.0
Lithuania:
Cement___________________
59. 5
Salt_______________________ 76. 0
Agricultural machinery____
80. 0
Sugar_____________________
84. 4
Netherlands: Groceries_________
6. 0
Poland:
Total retail trade__________
3. 0
F ood__________ ___________ 10.0
Sweden:
Total retail trade__________
12. 0
14.5 Food______________________ 20. 0
Switzerland:
Total retail trade_______10. 0-12. 0
Sugar and macaroni__ >,____
80. 0
1Data relate to 1942.
IM P O R T A N C E IN
T ER M S OF PR O D U CTIO N
Cooperatives had made considerable progress in producing their
own supplies—both in variety of product and in volume of goods
produced. In most cases the major part of the production was
carried on by the cooperative wholesales, either in their own depart
ments or through separate subsidiary organizations. The local co
operatives generally produced a small amount also, mostly perish
able goods like meat products and bakery goods.
Table 7 shows for the latest year for which production figures are
available the value of goods produced and their relative importance
in terms of wholesale business. Only in the case of Sweden did the
wholesale's production account (in value) for as much as half of its
total sales.
27
Development and Characteristics
T a b l e 7.— Value o f Own Production o f Cooperative Wholesales, by Country
[For par values of currency, see Appendix table, p. 278]
Goods produced
Country
Year
Austria..............
1935
Bulgaria............
Czechoslovakia.
Denmark..........
Estonia.............
Finland.............
France...............
Germany..........
1936
1936
1937
1939
1939
1939
1931
Mone
tary
unit
Value
Schil 29,718,000
ling.
Lev___ 117.433,998
Koruna 1255,991,550
Krone- 60,597,998
Kroon— 8,800,000
Markka 1599,300,000
Franc.. 81,200,085
Beichs- 1155,326,693
mark
Goods produced
Per
cent
of
total
sales
Country
42.8
Great Britain..
Hungary...........
Iceland..............
Netherlands___
Norway.............
Poland...............
Rumania______
Sweden..............
22.1
31.0
29.3
24.2
20.6
6.4
31.1
Year
1939
1939
i939
1938
1939
1938
1935
1939
Mone
tary
unit
Value
Pound..
Pengo..
KroneFlorin..
KroneZloty—
Lev___
Krona..
151,376,254
11,352,734
4.257.000
3.424.000
24,400,000
10,000,000
590,469
144,535,346
Per^
cent
of
total
sales
34.3
8.9
15.2
12.3
39.0
10.0
22.3
53.7
i Two organizations.
In many countries the wholesales undertook production as part of
a definite aim toward cooperative self-sufficiency. This was the case1
in Bulgaria, Czechoslovakia, France, Germany, and Great Britain.
In other countries the consumers' cooperatives entered production
only when they were unable to obtain goods of satisfactory quality
or at a satisfactory price. Outstanding in this class were Denmark,.
Sweden, and Switzerland. The policy of this latter group resulted
in some spectacular struggles with cartels and other concentrated
private industry, but the entrance of the cooperative wholesale into
manufacture resulted in drastic price reductions— in Denmark in the
prices of rolled oats and twine, in Sweden in the prices of margarine,
electric-light bulbs, flour, commercial fertilizer, and rubber footwear,
and in Switzerland in the prices of flour, shoes, meat, and chocolate.7
So effective was the Swedish wholesale that eventually it won price
reductions merely by a threat to enter production of certain commod
ities. In Austria the wholesale's entry into production was occa
sioned by the desperate situation at the end of the first World War.
In several fields the wholesale participated with other agencies (the
Austrian Government, municipalities, trade-unions, etc.) in enterrises to produce needed goods. Some of these enterprises were
quidated during the post-war depression, others were continued by
the wholesale.
The Czech cooperative wholesale, V. D. P., in 1937 was the largest
flour-mill operator in the country. The German wholesale in Czech
oslovakia produced more canned goods (fish, fruits, vegetables)
than its affiliated associations could use; and it exported the surplus
to Sweden, Finland, and Germany.
The articles produced by the wholesale organizations just before the
war are listed in table 8. Undoubtedly some of the productive plant
has suffered dining the war, especially in those countries that have
served as battlefields or have been deliberately devastated by the
Germans. Nevertheless the list indicates the type of commodities
that may be available from cooperative sources.
E
7 In the case of chocolate, price reductions were obtained by a concerted boycott of the cartel’s products
by cooperative associations.
28
Comparative A nalysis
T able 8.— Commodities Produced by Cooperative Wholesales, Prior to W ar
Austria
Belgium
France3
Food products (bakery goods, sau
sage, macaroni, crackers, noodles,
confectionery).
Chemical products (soap).
Clothing i (underwear, shoes, and
other).
Textiles.2
Food products (margarine, jam,
canned goods, mustard, syrup,
chocolate, cornmeal, confec
tionery).
Chemical products (soap, paint).
Clothing (shoes, hats, caps).
Tobacco products (cigars).
Food products (butter, choco
late, canned goods, salt, candy).
Chemical products (soap).
Clothing (shoes).
Twine.
Czechoslovakia (2 associations)
Denmark
Estonia
Food products (bakery goods, bak
ing powder, butter, cheese, choco
late, canned goods, chicory, edible
paste products, fish products,
flour, jam and preserves, meat
products, mustard, pickles, sauer
kraut, vanilla, vinegar, fruit wine,
confectionery, spices).
Chemical products (metal and shoe
polish, cosmetics).
Textiles (hosiery, ribbon, and other
knitgoods).
Clothing (trousers, suspenders, un
derwear, shoes, sportswear).
Elastic goods.
Food products (chocolate, flour,
rolled oats, margarine, mus
tard, spices, confectionery,
coffee roasting).
Chemical
products
(soap,
paper).
Textiles (hosiery, rugs).
Clothing (shoes, dresses, etc.).
Tobacco products (tobacco,
cigars).
Farm supplies (harness, twine,
rope).
Wine.
Leather.
Bicycles.
Flax cultivation and flax proc
essing.
Finland (2 associations)
Pre-Nazi Germany (2 associa
tions)
Food products (coflee roasting,
bakery goods, margarine, pre
serves, edible paste products,
crackers, flour, fish products,
pickles).
Chemical products (fertilizer, match
es. paper).
Clothing.
Textiles products (hosiery, knitted
underwear).
Brushes.
Building supplies (lumber, bricks).
Food products (flour, edible
paste products, meat and fish
products, malt coffee, jams,
preserves, cocoa, chocolate,
cheese).
Chemical products (soap,
matches, and other).
Clothing.
Textiles (weaving, dyeing).
Tobacco and its products.
Printing, stationery*
Farming.
Food products (mustard).
Chemical products (soap, tooth
paste, shoe polish, blacking,
ayes, lacquers).
Household supplies (starch,
brooms, brushes, cutlery).
Costume jewelry.
Rope, cord.
Lubricating oil.
Bulgaria
Iceland
Latvia
Food products (canned vegetables
and fish, cheese, rice, flour, sugar).
Electric-power generation.
Rock-salt mining.
Chemical products (soap).
Clothing (shoes, gloves, dresses,
etc.).
Textiles (woolen goods).
Leather.
Food products (coffee roasting,
cured fish, flour).
Chemical products (soap, cos
metics, lubricants, mineral
colors, polishes).
Alcohol, wine*
Metal products (nails, wire,
chains, tinware, agricultural
implements).
Building supplies.
Mining.
Experimental-farm
operations
(stock raising, gardening, tree
nursery, milch cows).
Hungary
Food jpjoducts (meat, salt).
Chemical products (drugs).
Lumber.
Flax processing.
Lithuania *
Netherlands
Norway
Food products (flour, sugar, meat
products).
Chemical products (soap, oil polishes,
lubricants).
Food products, (cheese, jams,
cooking oils, packaged goods).
Chemical products (cosmetics).
Clothing.
Food products, (margarine, coffee
roasting, flour, chocolate).
Chemical products (soap).
Clothing (shoes).
Textiles (woolen goods).
Leather.
Tobacco products.
* Factory closed, 1934.
2 Private business forced discontinuance in 1934.
* Also joint owner in several other enterprises.
* In most cases production was carried on through subsidiary organizations owned jointly with other
cooperatives or with the Government.
29
Development and Characteristics
T a b l e 8.— Commodities Produced by Cooperative Wholesales, Prior to W ar— Con.
Switzerland *
Poland
Sweden
Food products (soap, crackers, pre
serves, flour, canned fish, confec
tionery).
Chemical products (shoe polish, var
nish, cosmetics).
Paper and paper bags.
Building supplies Cumber).
Gunny sacks.
Food products (flour, marga
rine, bread, vegetable oil, coffee
roasting, commeal, meat prod
ucts).
Chemical products (soap, match
es, phosphates).
Clothing (galoshes, shpes).
Textiles (artificial silk goods).
Household supplies (pottery,
porcelain ware).
Building supplies (cement).
Cash registers.
Food products (flour, coffee
roasting, cornmeal, lard, pud
ding powders, spices, yeast).
Farming. Printing.
Great Britain (2 associations)
Great Britain—Continued
Great Britain—Continued
Food products (margarine, butter,
and other milk products, lard,
bacon, sausage, cured fish, pickles,
poultry, preserves, flour, canned
goods, salted and packaged goods,
confectionery).
Coal.
Bicycles.
Chemical
products
(soap,
candles, paint, drugs).
Clothing (furs, umbrellas, shoes,
hats, caps, corsets, underwear,
dresses, etc).
Textiles and their products
(woolen, cotton, and silk
cloth, hosiery, knitgoods).
Rope.
Household. supplies
(starch,
brushes, cutlery, bedding, fur
niture, glassware, tinware, lin
oleum).
Tobacco and its products.
Printing, bookbinding.
Engineering and construction.
Farming.
Yugoslavia
Food products (cheese, confec
tionery, salt).
Chemical products (shoe polish).
Lubricating oil.
5 And (jointly with other organizations) cigars, furniture, shoes, poultry, cheese.
IMPORTANCE IN TERMS OF IMPORTS AND EXPORTS
The Austrian wholesale, GoC, had built up an extensive export
and import trade with Russia, through an organization in which (at
the Russian end) the Russian Government participated. In Bulgaria,
“ Napred” was also an important importer and exporter, and was the
sales outlet for the salt produced by the agricultural cooperative
syndicate. The Estonian wholesale, E. T. K., accounted for 10 per
cent of Estonia’s imports, but in individual commodities its business
ran up much higher; 30 percent of the rice, 40 percent of the sugar
and petroleum, 50 percent of the agricultural machinery, and 80 per
cent of the fertilizer brought into the country were imported by this
cooperative organization. Until 1937 it was also an important ex
porter, handling 13.5 percent of the butter exported, 23.0 percent
of the eggs, and some fish, fruit, and potatoes, but this export business
came to an abrupt end in that year, when the Government took over
all export business.
Although the French wholesale, M. D. G., carried on an exporting
and importing business with cooperatives in Belgium, Czechoslovakia,
Great Britain, Italy, Poland, Soviet Union, and Switzerland, this had
been cut considerably even before the war by the increasing restric
tions on international trade in the thirties. Before the rise of Na
tional Socialism in Germany, the consumers’ cooperative wholesale
there, G. E. G., was a large importer of goods, mostly bought from
, cooperative sources. In 1931 it imported goods valued at 11,200,000
reichsmarks, from 22 European and Asiatic countries.
The wholesales of England and Scotland had purchasing agents in
various places throughout the world and carried on a very large
business of import and export through them.
The export business of the Hungarian cooperative wholesale,
“ Hangya,” was started after the end of the first World War, as a
joint enterprise in which the Government was the other partner.
30
Comparative A nalysis
Its company, Futura, became the channel for the collection and
export of agricultural products raised throughout Hungary, as well
as for the distribution of State-controlled goods. Futura’s operations
took it into Austria, Czechoslovakia, Italy, Poland, and Switzerland.
In Lithuania the wholesale, Lietukis, in 1939 was the only exporter
o f (and largest dealer in) cereals in Lithuania and handled some 45
percent of the total national flax exports. The Icelandic wholesale
handled over 25 percent of Iceland’s imports and 90 percent of the
meat, 80 percent of the wool and 80-90 percent of the agricultural
products exported. It had branch offices in Copenhagen, Leith
(Scotland), and New York City.
The exporting and importing business of the Danish, Finnish, Nor
wegian, and Swedish cooperatives was carried on through a joint
organization, the Scandinavian Cooperative Wholesale (Nordisk
Andelsforburu}). In addition, the Swedish cooperative wholesale,
K. F., helped to organize an association for the export sale of Swedish
handicraft goods; this association, “ Products from Sweden,” began
business in 1935.
V. S. K. in Switzerland had, by 1939, become the largest importer
of the goods it handled.
Cooperatives in W orld W ar I I
SITUATION IN OCCUPIED COUNTRIES
In the early stages of the war the consumers’ cooperative movement
suffered the greatest physical destruction in Czechoslovakia, Poland,
and Yugoslavia. To some extent this was the result of dismember
ment of the country; the characteristic Nazi hostility toward con
sumers’ cooperatives accounted for the rest. In Czechoslovakia,
cooperators (especially those of German descent) had for nearly 3 years
been subjected to a steadily mounting campaign of intimidation and
vilification by the Nazi sympathizers in the country and finally had
seen the movement split up into several pieces as the Government was
forced to cede territory to Germany, Poland, and Hungary. The
plant and business (factories and all) of the German branch of the
movement were destroyed. The Czechoslovak structure was drasti
cally telescoped and consolidated, and some of the facilities were turned
over to private traders. In 1942, four federations were created by
decree, in the so-called Protectorate (Moravia and Silesia)—for agri
culture, consumers’ , housing, and other associations, respectively—
and two auditing unions; ail were placed under the control of four
Government departments. All of the members’ rights and authority
is exercised by “ trustees,” appointed by the Nazis.
In the primary stage of the war, when Polish territory was divided
between Russia and Germany, the Russians dissolved all the Polish
urban associations in their area but left the agricultural cooperatives.
The associations in territory incorporated into the Reich were dissolved.
In other German-occupied areas, cooperatives of all types were at first
tolerated, but later even fostered, because they were useful.
In Yugoslavia part of the movement was lost in the partitioning of
the country. In Slovenia the cooperative property and savings
deposits were seized by the Germans and Italians. In Serbia, after
an initial period of destruction and nazification, the potential value of
Development and Characteristics
31
the cooperative network apparently led not only to toleration by the
puppet government but expansion by it. A proposed reorganization
by the Government, reported in 1943, contemplated a considerable
expansion of associations and functions, one of which was the estab
lishment of a health cooperative in every community with over 4,000
inhabitants. The Nedic Government reported that these suggestions
had been voted upon favorably by the associations.
During the period of Russian occupation, the cooperatives of the
Baltic States suffered first by losses of property and supplies, then by
incorporation into the Russian cooperative system. Later, under the
Germans, all three countries were combined into the new Ostland
Province, the cooperatives being allowed to continue under strict
Nazi control. In the initial period after the German invasion a
cooperative paper mill in Estonia and an unspecified productive plant in
Lithuania were confiscated and turned over to German businessmen.
In western Europe, a much milder policy was followed by the
Germans from the start. Although under strict control, the actual
operation of the cooperatives does not appear to have been greatly
interfered with in Belgium, Denmark, and the Netherlands, at least
up to the time of the launching of the Allies, invasion campaign of
liberation. In Norway the initial lenient period was followed by
confiscation of the wholesale's plant and goods, after the officials re
sisted undercover attempts at Nazi domination; the retail associations
are still in operation. By far the largest part of the French consumers'
cooperative movement was in the northern (occupied) section of the
country. When France was invaded the Germans destroyed the
cooperatives in Alsace-Lorraine and incorporated their business into
the German Labor Front. Late (1943) reports indicate that elsewhere
in occupied France, after the initial period of destruction, and in
Vichy France the associations were allowed to continue operations.
The volume of wholesale cooperative business fell off drastically in
1940 and 1941, but recovered to a considerable extent in 1942, and the
number of affiliated associations even increased.
SITUATION IN ALLIED OR NEUTRAL TERRITORIES
In most of the Allied and neutral countries the cooperatives are
operating as before the war, though affected like all business by war
time shortages of goods and manpower and by rationing and other
regulations. In practically all, membership has expanded and gener
ally volume of business as well. The Swedish wholesale has even
expanded its productive facilities and is entering new fields.
The cooperatives—rural consumers’, workers’ productive, and
agricultural—in the Soviet Union are being utilized in the economy of
that country to a greater extent than at any time in the past decade.
In Spain where the cooperative movement was in disfavor with the
Franco Government because of its services to the Loyalists, a new
law was enacted in 1942, incorporating the movement into the totali
tarian State.
SITUATION IN AXIS COUNTRIES
By the time of the outbreak of war, in September 1939, the German
consumers' cooperative movement was well on its way to dissolution.
In Austria, which had ratified the Anschluss with Germany and had
been invaded by the Germans, the consumers' cooperatives had been
32
Comparative Analysis
“ adjusted to the New Order” and were gradually disappearing. The
process of destruction in both countries was complete by the end of
1942. In both countries, however, agricultural cooperatives were re
ported to be still in operation as far as they were useful to the Germans.
In Bulgaria and (at first) in Rumania the cooperatives'were utilized
for the collection and distribution of foodstuffs to the population.
Later, in Rumania, they were superseded in this task by a network of
State agencies.
From the beginning of the Ethiopian campaign the Italian Govern
ment encouraged the formation of new Fascist cooperatives in North
Africa; the fate of these, in view of the later military events in that
region, can be imagined. No data are available regarding recent devel
opments in the Fascist cooperative movement on the mainland,
where for many years they have been part of the corporative system.
Both Rumania and Finland suffered division of the cooperative
movement through losses of territory early in the war, but in the case
of Finland these were regained after that country became an Axis
satellite. In the latter country increases in both membership and
(money) sales have occurred, but volume of goods handled has de
creased about 10 percent.
Of all of the countries of Europe, only the cooperative movement
of Hungary could, at the end of 1943, be said actually to have bene
fited by the war. An increase in membership and business of Hungar
ian cooperatives, and the additional associations gained by territorial
acquisitions in Czechoslovakia and Subcarpathian-Ruthenia, com
bined to increase an already powerful position.
It appears, on the whole, that whatever the Nazi antagonism toward
cooperatives, the Germans have not, in most cases, hesitated to make
use of them. By this very fact, however, they have preserved the
cooperative structure which will, with the exception of a few countries,
be more or less intact for post-war, genuinely cooperative use, when
membership control and operation are resumed. Concerning this,
the International Cooperative Alliance recently commented:
* * * We have yet to learn how far the movements have been inwardly
affected by the abasement of their organization to the service of a regime whose
whole purpose is the annihilation of all that cooperation stands for— its ideals,
principles, and practice. It seems almost inevitable that the vitality of the
movements will be impaired— in some cases, perhaps, that their idealistic anima
tion may be weakened by the effects of totalitarian ideology.
Most, if not all
of the movements must, we think, pass through a kind of spiritual convalescence.
International Aspects o f the Cooperative Movement
Before the outbreak of the present war, cooperative associations
of one kind or another were in existence in 56 countries throughout
the world. In most countries the local associations had federated
into one or more central organizations for educational or commercial
purposes and, in some, all branches of the movement were coordinated
through one national body.
These national organizations since 1896 have had an international
organization, the International Cooperative Alliance. Largely
Development and Characteristics
S3
through the sponsorship of the Alliance, another international associa
tion was formed to act as a clearing house of information on matters
relating to wholesaling. The latter, in turn, helped to start an inter
national joint-buying organization which was just getting well under
way when the war started. An older wholesale body acted as joint
purchasing agent for the Scandinavian countries. The subjects of
banking and reinsurance on an international scale had been studied
by special committees and some progress had been made, especially
in the latter field.
The women in the cooperative movement who were organized into
national guilds in the various countries, also had their international
organization.
Probably the most consistent supporters of cooperation in the inter
national field have been Austria, Belgium, Bulgaria, Czechoslovakia,
the Baltic States (Estonia, Latvia, and Lithuania), France, Great
Britain, Hungary, and the Scandinavian countries. These have had
membership in practically all the organizations the purpose of which
was to further cooperative relations among the countries.
The one-hundredth birthday of the Kochdale cooperative move
ment, being celebrated in 1944, finds the international activities either
curtailed or prevented entirely by the war. The machinery is there,
however, and cooperators are making plans for early resumption as
soon as peace returns and conditions permit.
International Cooperative Alliance
M E M B E R SH IP OF A L L IA N C E
The International Cooperative Alliance (“ I. C. A .” ) was created in
1896, following authorization by the First International Cooperative
Congress, held in London in 1895.
The I. C. A .’s membership, at first consisting of individuals (who
were not necessarily even members of cooperatives) interested in the
idea and willing to assist, gradually included more and more local
cooperative associations. In 1902 individual membership was abol
ished and beginning in 1910, under another change of rules, only
national federations were accepted, their affiliates thus becoming
members only indirectly.
By 1913, the I. C. A. had in affiliation 55 national cooperative federa
tions of 24 countries. Their association membership totaled 3,871;
at that time there were 20 million cooperators whose associations were
in the I. C. A. family.
The war years, 1914-18, were very difficult for the Alliance, but it
managed to maintain contact with all of its members, even in the
warring countries.
The peak I. C. A. membership was reached in 1930 when 117 national
federations in 40 countries were affiliated. The local associations in
membership with these federations numbered 193,000, and the latters’
individual members totaled 56 million persons.
In 1933 only 39 countries were represented in 1. C. A. membership,
but the affiliated local associations had an aggregate membership of
107,700,000 persons. Later events reduced the membership of the
Alliance, as table 9 indicates. With the ascendancy of the Nazis in
the early thirties the German cooperatives were subjected to drastic
34
Comparative A nalysis
reorganization,8 then taken over by the Labor Front, and finally
wiped out. About the same occurred in Austria after the Anschluss
with Germany. In 1935 the Soviet Government dissolved the urban
cooperatives in that country, reducing the cooperative membership
by 30 million persons. Italy had lost its membership in the Alliance
in the early twenties when the Italian cooperative movement was
absorbed into the Fascist corporative order, though the associations
there were still called “ cooperative.”
After the launching of the Nazi offensive, in succession the coopera
tive movements in Czechoslovakia, Poland, Norway, Denmark,
Netherlands, Belgium, and France were cut off from their inter
national organization. Spain had withdrawn from membership at
the beginning of 1939; the reason for this action was not reported
but it may be noted that its withdrawal occurred shortly after the
defeat of the Spanish Republic (which had had the support of the
cooperatives) by General Franco. In all of these countries (as well
as in Austria) the I. C. A. looks upon the cooperatives as “ victims of
aggression” and they are regarded as still in membership though
restrained from active participation.
Other countries no longer in membership in the Alliance include
Portugal, Iran (Persia), and Turkey.
In September 1939 the I. C. A. was a federation representing the
cooperative movements of the following countries:
Europe
Belgium
British Isles1
Bulgaria
Czechoslovakia
Denmark
Estonia
Finland
France
Hungary
Iceland
Latvia
Lithuania
Netherlands
Norway
Poland
E urope — Continued
Rumania
Soviet Union ( + 6 Republics)
Sweden
Switzerland
Yugoslavia
N on -E u rop e
Argentina
Canada
India
Japan
Korea
Palestine
Union of South Africa
United States
iEngland, Wales, Scotland, Northern Ireland, and Eire are all members of the I. O. A . thronghtheir
affiliation with the Cooperative Union, Ltd., of the United Kingdom, which is a member of the Alliance.
In some countries, several national federations hold membership in
the I. C. A .; this usually occurs where each of the different branches
pf the movement (consumers’ , credit, agricultural, etc.) has its own
national organization. Examples are Bulgaria, Finland, France,
Poland, and Yugoslavia. In other countries where the various
branches of the movement are federated into a single national body—
as in Japan, Lithuania, and the British Isles— only the national
organization holds membership. In still other countries, only certain
branches of cooperation have, through their central organization,
joined the Alliance; among these are Belgium (consumers’), Canada
(consumers’ ), Estonia (wholesale association only), Iceland (con
sumers’), Korea (credit), Latvia (banks), Norway (consumers’), and
Sweden (consumers’).
The trend of I. C. A. membership is shown in table 9.
8 The Nazi federation that was created during this reorganization applied for membership in the Alliance
but was not admitted.
35
D evelopm ent and Characteristics
T a b l e 9 .— M em bership of International Cooperative Alliance, 1 9 1 3 -3 8
Year and type of association
1013
loan
1032
1033
103S
1033
__________________________
______
_
___
________
_________
____ _ __
_____________________
___________________________ ________
__________________
__ _ __
_ __ __
_________________________
_________
Cnns1lTnfir8,
_
W h o le sa le s. _ _
.
_ _ _
Workers’ productive................. ..........................
Productive federations______________________
AgrieuH nral
T
. ...
Credit associations and their federations_____
Insurance and other.............................................
Number
of
member
countries Number of Theirship
Their business
associations
repre
sented
G o ld £
24
40
41
39
««•
31
26
10
5
14
16
14
3 ,871
193,000
(9
0)
132,494
168,672
35,837
20 ,0 0 0 ,0 0 0
5 6 ,0 0 0 ,0 0 0
9 9 ,6 0 0 ,0 0 0
1 0 7 ,700 ,00 0
6 5 ,6 7 6 ,5 3 3
7 2 ,3 8 4 ,1 6 4
52; 950 ,623
1 ,017
97,061
4 3 ,668
8 7 ,378
772
5 ,1 5 5 ,2 8 6
14 ,0 7 4 ,0 7 6
107,118
0)
0)
0)
3,201,450,352
3,644,886,997
1,811,895,494
934,370,002
715,318,899
9,693,277
7,758,037
95,461,022
43,418,123
5,876,134
1No data.
MEMBERSHIP QUALIFICATIONS
As indicated in table 9, the largest membership in the Alliance is
that of consumers’ organizations, but the I. C. A. admits all types of
cooperatives that can qualify. In order to become a member the
applicant must show that it conforms to the following four principles:
(1) Open membership, (2) democratic control (one member, one vote),
(3) distribution of surplus earnings to members in proportion to their
patronage, and (4) limited interest on share capital. The other three
Rochdale principles (political and religious neutrality, cash trading,
and promotion of education in cooperation) are not included as essen
tial membership qualifications, although recognized as “ undoubtedly
part of the Rochdale system.” 9
ACTIVITIES OF THE ALLIANCE
The main purpose of the I. C. A. is to promote the spread of the
cooperative movement and to bring about better and closer relation
ships among the movements of the various countries and among the
various branches of cooperation.
During the decade following the first World War the Alliance many
times intervened with the governments of the various countries of
Europe “ in defense of the democratic interests of cooperators.” It
was not until 1932 that it could report that it had “ ceased to be dis
tracted from its proper tasks” by such activities. The following
years, however, which brought in their train the trend toward total
itarianism, entailed even greater problems.
Beginning in 1921 the Alliance held an annual international
cooperative school at which economists, publicists, and cooperative
leaders gave courses to students from nearly a score of countries.
Many of the students were themselves officials of national cooperative
organizations.
I. C. A. committees were formed for the study of certain subjects.
Among these were the International Committee for Inter-Coopera
tive Relations (the purpose of which was to promote closer relations
•The above was decided at the Paris Congress in 1937, on the basis of a 7-year study by a special committee.
This committee stated that, in its opinion, “ nothing in the modern developments of industry and commerce
or changes in economic method, has diminished the integrity of the seven Rochdale principles.’*
36
Comparative A nalysis
between the consumers' and agricultural branches of the movement)
and committees on wholesaling, banking, and insurance. Since the
early thirties the I. C. A. has also made a series of research studies of
modern economic problems of interest to the cooperative movement.
Among the other activities of the Alliance have been the promotion
of trading relations between the agricultural and consumers' coopera
tives; activities looking toward the establishment of an auxiliary
committee on workers' productive associations within the Alliance;
the publication of a monthly magazine (Review of International
Cooperation) in English, French, and German; three news services;
and various studies and statistical reports.
Under I. C. A. sponsorship, millions of cooperators throughout the
world celebrate the first Saturday of each July as “ Cooperative D ay,"
displaying the Rainbow Flag of the cooperative movement and stag
ing pageants and other presentations of cooperative progress.
The international cooperative congresses, convened by the Alliance
every 3 years on the average, have brought together cooperators
from all oxer the world for better acquaintance and understanding of
each other and of the problems and experience of the cooperative
movement. The fifteenth congress was held in Paris in 1937. The
sixteenth, scheduled to be convened in Prague, Czechoslovakia, in
1940, was of course made impossible by the outbreak of war.
Cooperative insurance.— The International Cooperative Alliance in
1922 created an Insurance Committee for the study of possibilities of
carrying on insurance on an international scale. Studies by the com
mittee convinced it that as insurance was already fairly well provided
for in each country, the main possibilities lay in the reinsurance, be
tween countries, of risks written by the various national organiza
tions, the arrangements to be made directly by the insurance organi
zations concerned and not through an international agency.
Some progress has been made in this respect, and a certain amount
of reinsurance of risks has actually been carried on among the insur
ance organizations of the various countries. The main activities in
this line had been the reinsurance of fire risks among Sweden (the
“ Samarbete" association), Norway (“ Samvirke"), Great Britain
(Cooperative Insurance Society), and Finland (“ Kansa"). The as
sociations of Belgium and Great Britain also had experimented with
reinsurance of life, accident, etc., risks, and that of the former country
(La Pr6voyance Sociale) also had such contracts with the cooperative
insurance organizations of Bulgaria and Hungary, as well as a fifeinsurance branch in France.
In 1939 the membership of the I. C. A. Insurance Committee con
sisted of the central insurance cooperatives of Belgium, Bulgaria,
Czechoslovakia, Denmark, Estonia, Finland, France, Great Britain,
Hungary, Latvia, Netherlands, Norway, Palestine, Rumania, and
Sweden.
Post-war problems.— During the past 2 years the attention of the
Alliance and its officials has been given increasingly to the problems
of the post-war period, especially in relation to the cooperative move
ment. Detailed and painstaking study has been and is being made of
the various aspects of relief and rehabilitation of cooperatives in wardevastated countries throughout the world. In November 1943 the
central committee of the Alliance called a conference on post-war
problems, at which were present representatives from various national
37
Development and Characteristics
cooperative movements. A similar conference was called by the
Cooperative League of the U. S. A. in January 1944, which approved,
among other steps, the formation of an International Cooperative
Manufacturing and Trading Association (whose members would be
the national bodies).
The International Cooperative Alliance and its members believe
that the post-war world holds great possibilities for the cooperatives
and that they are equipped to play a considerable part in its reconstruc
tion.
Scandinavian Cooperative W holesale
The first attempt at cooperative wholesaling beyond national bor
ders was the Scandinavian Cooperative Wholesale (Nordisk Andelsforbund), established in 1918 by the wholesales of Norway, Sweden, and
Denmark. The two wholesales of Finland (S. O. K. and O. T. K .)
became members iii 1928.
This organization was capitalized at 1,225,000 kroner, of which
Denmark and Sweden each supplied 350,000 kroner, S. O. K. o f
Finland 250,000 kroner, O. T. K. of Finland 200,000 kroner, and!
Norway 75,000 kroner. Its function was to pool the orders of its
member wholesales for products of common use and buy at the best
advantage from cooperatives or other sources.
Its operations were successful from the first, and in its 25 years*
existence it has failed to make earnings in only one year— 1941.
The trend of the business and net earnings of the Nordisk Andelsforbund from 1919 to 1942 is shown in table 10. In 1932 the wholesale
purchased a coffee plantation in Java, “ with the possibilities of copra
and rubber production.”
T a b l e 10.— B usiness and N et Earnings o f Scandinavian Cooperative W holesale Society,
1 9 1 9 -4 2
Year
1919
1921....................................
1925...................................
1930....................................
1935
1936....................................
Amount of
business
Net
earnings
K ro n er
K ro n er
9,647,649
11,385,492
19; 161,174
27,800,000
45,231,452
50,807,317
154,761
206,503
260,912
348,909
335,339
Year
1938...................................
1939...................................
1940...................................
1941.................................
1942...................................
Amount of
business
Net
earnings
K ro n er
K ro n er
66,826,330
66.300.000
15.900.000
14,041,985
i 5,380,022
431,970*
455,000'
108,534
2 55,284
9,438
» Not including business of London Branch— £115,815 in 1941 and £186,096 in 1942.
2 Loss.
The war has cut off the London branch from the headquarters at
Copenhagen and interfered with the wholesale’s service to its mem
bers, reducing its business in 1941 by nearly three-fourths. However,
thanks to increased orders from Sweden, its sales in 1942 showed an
increase. Almost 90 percent of its business in that year was with
Kooperativa Forbundet in Sweden.
International Cooperative Wholesale Society
The International Cooperative Wholesale Society was organized
in 1919, as a medium of exchange of advice and information among
the cooperative wholesales of the various countries; no commercial
38
Comparative A n alysis
activities were carried on by it. Its headquarters are in Manchester,
England.
The membership of the I. C. W. S. in 1939 consisted of the whole
sales in Belgium, Bulgaria, Czechoslovakia (2 organizations), Den
mark, Estonia, Finland (2 organizations), France, Great Britain (3
organizations), Hungary, Latvia, Lithuania, Netherlands, Norway,
Palestine, Poland, Soviet. Union, Spain, Sweden, Switzerland, and
the United States.
Table 11 shows the value of imports and exports of the wholesale
associations affiliated to the International Cooperative Wholesale
Society. Beginning with 1934, Germany, Ireland, and the Ukraine
were no longer shown as in membership. Austria ceased to partici
pate in 1938, and Poland and Czechoslovakia in 1939, after the Munich
agreement which destroyed their national sovereignty.
The detailed data for 1938— the latest year for which statistics are
available— show the volume of imports and exports of each of the
reporting countries’ The main articles of import were bacon, butter,
coffee, lard, rice, sugar, tea, and wheat.
T a b l e 11.— Exports and Im ports o f M em bers o f International Cooperative W holesale
Society, 1 92 8 -3 8
Member countries
Year
Total
1028
________________
_________________
1080
____
____ ____
_
______________
1031 ___________________________________________
1032 _ ___________________________ ________ .. .
________ _____
1033_________________________
1034
____ __
.
. ___________
1035
_ _ _ _ .
__
____ ._
1936...... ............................................................................
1037 ____________________________________________
1038
Belgium
_ _ _.
_
...
.
Biilsraria __
^
Czeehnsinvalria . __
England _
,
Estonia
..........
Finland.
. . .
. . . . .
Franna
Netherlands.
_. _ _ _
Norway__________ ___________________________
P o la n d
..............
S n n tla n d .
S w e d e n ___
__
S w it z e r la n d ....
_
______ ,, _
...........
_
^
_
..
^
23
23
23
23
23
120
20
*21
ft22.
22
Number
reporting
16
17
16
16
14
14
14
14
14
13
Value (in gold £ ) of—
Imports
60,611,444
53,144*692
47,039,000
41,180,034
39,281,298
39,977,958
44,046,896
46,553,615
54,482,602
53,392,931
41,275
116,478
456,796
40,104,595
577,240
1,289,231
568,296
233,971
280,304
262,647
4,937,107
3,779,619
745,372
Exports
1,169,960
0)
(l)
2,133,490
(0
<0
1,658,006
534,353
1,592,000
1,521,658
1,187
13,585
300,488
24,231
58,854
14,899
14,916
16,398
94,998
48.885
913,259
19,958
» No data.
* Germany, Ireland, and Ukraine not included in membership in 1934.
* The United States (National Cooperatives, Inc.) became a member in 1936.
ft Spain became a member in 1937.
International Cooperative Trading A gen cy
The International Cooperative Trading Agency10was established in
1937 under the auspices of the International Cooperative Wholesale
Society.
As stated at that time, the agency’s functions were to act as pur
chasing agent of imported articles, for the various national cooperative
10 Originally established as the International Cooperative Agency. The word “ Trading” was inserted
later, in order to avoid confusion (in initials) with the International Cooperative Alliance.
Development and Characteristics
39
wholesale associations. In addition it was to market in other coun
tries the surplus production or stocks of these associations. Among
its charter members were the English and Scottish Cooperative
Wholesale Societies and the wholesales of Sweden and Finland.
Business was to be carried out on a commission basis, surplus earnings
being distributed to the member associations on their patronage.
Voting also varied on the basis of patronage, but was subject to a
fixed maximum for any single organization.
By the end of 1937 it was reported that 14 cooperative wholesale
associations had affiliated with the new agency. However, these
included 6 which already had their own direct trading contacts
abroad 11 and would not therefore be likely to make much use of the
new association. The membership of the Agency in 1939 consisted
of the wholesale organizations in 12 countries (Belgium, Bulgaria,
Czechoslovakia, Estonia, Finland (O. T. K .), France, Great Britain
(both the English and Scottish associations), Netherlands, Palestine,
Poland, Sweden, and Switzerland.
The Agency began operations early in 1938. This action was the
culmination of 30 years’ effort to establish cooperative trading on an
international scale. It represented the first cooperative action to unite
the established cooperative wholesaling machinery on a wide terri
torial basis, although there had been several previous instances of
collaboration in the purchase of imports (as between the English and
Scottish wholesales and among those of the Scandinavian countries).
Establishment of such an international agency was contemplated in
the early thirties but, as even then restrictions on foreign trade were
becoming formidable and tariff and other barriers were being erected,
the times were not deemed propitious for the success of an agency.
The I. C. T. A. was hampered from the start by currency and cus
toms restrictions in the various countries. The outbreak of war in
1939 was accompanied by new export and import regulations in most
countries, and in certain cases whole branches of trade were taken over
as monopolies by the State. For some countries, foreiga commerce
ceased altogether. Nevertheless, the Agency’s contracts for 1938
amounted to $763,000, and rose in 1939 to $1,183,000.
Even during the first year of the Agency’s existence, 1938, its “ most
loyal members,” the wholesale organizations of Austria and Czecho
slovakia, were lost and this affected its business sharply. The Spolem
association in Poland was the next casualty. However, aside from
this the agency had so expanded its contacts and business that its
future looked very promising. Through arrangement with coop
erative producer organizations it had assured supplies of various dairy
products, fruits, and vegetables, and it had become the selling agent
for certain productive enterprises run by the wholesales of several
countries. It sold condensed milk from the Netherlands, onions from
the Netherlands and Hungary, fruit pulp and fresh grapes from
Bulgaria, paper from Sweden and Estonia, and cooperative grease and
motor oil from the United States.
The rapid sweep of invasion through eastern Europe and through the
Lowlands in 1939 and 1940 brought the activities of the Agency almost
to a standstill, and this situation has continued. The Agency is still
11England, Scotland, Sweden, Denmark, Finland, and Norway.
40
Comparative A nalysis
in existence, however, and doing some business. Although relatively
inactive, it is keeping its machinery and commercial arrangements
intact for the post-war period.
International Cooperative Production
As yet the only lines in which production has been attempted on an
international scale are the manufacture of rubber and electric-light
bulbs.
Production of bulbs is carried on by two associations. The oldest
of these, Kooperativa Lumaforbundet, was organized on the initi
ative of K. F. (Cooperative Union and Wholesale of Sweden) in
1931. Joint owners of the factory were K. F. and the wholesales in
Denmark, Norway, and Finland; membership, however, was left open
to other countries. The factory makes afl kinds of incandescent
lamps, disposed of mainly to the constituent wholesales, but it had
also built up an extensive export business to cooperative wholesales
in other parts of the world. The Luma lamp-research laboratories in
Sweden were the largest in the world, apart from those of the private
cartel whose monopoly Luma was organized to break.
In 1937, another factory was established in Scotland. This factory,
known as British Luma, Ltd., is owned by the cooperative wholesales
of England, Scotland, and Sweden.
Just before the outbreak of the present war, “ Napred” (cooperative
wholesale of Bulgaria) and K. F. (Sweden) built jointly a rubber
factory near Sofia. No data are available regarding its operations.
International Cooperative W om en's Guild
When in 1940 the International Cooperative Womens Guild entered
its twentieth year, it consisted of 17 affiliated associations situated in
Australia, Belgium, Bulgaria, Canada, England, Estonia, Finland,
France, Ireland, New Zealand, Norway, Poland (with two organizations),
Scotland, Sweden, Switzerland, and the Soviet Union, and a provisional
national guild committee in the United States. The Austrian and
Czechoslovakian guilds, once members of the International, had dis
appeared before the totalitarian legions, but the president of the
International (an Austrian woman who had suffered imprisonment in
Austria) was in England, sending words of encouragement to the affil
iated guilds as she had done ever since her first election as president
in 1921. In a New Year’s message of January 1944, she urged women
to prepare for more strenuous duties: “ We must fight for a system of
international collaboration that will guarantee lasting peace * * *
for a mothers’ peace that will safeguard the future of mankind and
spare unborn generations the agony and terror of war.”
Though the motive thus stated had been a dominant one from the
beginning of the women’s organizations, the first international meet
ings (of Austrian and Englishwomen cooperators in 1913 and of women
from six different national cooperative groups at Basel, Switzerland, in
1921) stressed the need for organizing the “world’s housewives in sup
port of cooperative ideals and trading methods.” By the time of the
first triennial conference of the I. C. W. G. (at Ghent in 1924), the
purposes of the Guild had been formulated: To unite the cooperative
women of all lands for (1) the development of the spirit, principles, and
Development and Characteristics
41
practice of cooperation, (2) the improvement of the conditions of
home life, and (3) the promotion of international peace.
Although the I. C. W. G. was neutral in politics, it stimulated
interest in political rights for women (especially after the Vienna con
ference in 1930, to which details of the different existing legal codes were
presented), in problems of the world economic order (particularly at
the London conference of 1934), and in peace and disarmament at the
Stockholm conference in 1927, the Geneva Disarmament Conference,
and the Paris Conference of 1937. At the Paris meeting its resolu
tions included statements on the international control oi migration,
the rights of colonial and mandated peoples, and the establishment
of a new court of international justice. The Guild cooperated with
League of Nations committees such as the Mixed Committee on
Nutrition and the Committee of Experts which inquired into the
legal position of women throughout Europe. It tried to combat the
spread of totalitarianism by encouraging increased participation of
youth and women in cooperative organizations. Because the co
operative movement is built upon the individual household, the
I. C. W. G. instituted effective discussion of such domestic problems
as the purity and price of foods, public kitchens and nurseries, home
laundering, and family allowances.
Since the rules of the I. C. W. G. required that national coopera
tive guilds affiliated to the International must operate under their
own executives elected by the women members themselves, and since
the position of women differed in different countries, the sphere of
the I. C. W. G.’s work was always greater than its actual membership.
In 1933, for example, the two main types of national guilds were (1)
self-governing federations of autonomous branches on the British
model and (2) guilds of the Central European type, in which the
women’s organizations were made up of the women members of the
consumers’ cooperatives. In certain other countries the influence
of the I. C. W. G. was felt, though national guilds had not yet been
established. These included India where women were starting their
own clothing cooperatives, Japan where local guilds numbered 100,
Greece and Rumania where publicity work was under way, Palestine
where women formed produce-marketing associations, Buenos Aires
where the first South American women’s guild was inaugurated in
1933, Hungary where the women’s cooperative league extended the
domestic and foreign market for embroidered articles, and China
where women were becoming active in industrial cooperatives.
The methods used by the national guilds for attaining the objec
tives named above ranged from women’s service on national com
mittees outside as well as within the cooperative movement (as in
Great Britain) to the day-to-day, house-to-house canvassing for the
promotion of the practice of cooperation carried on by the guilds in
many countries. During the early part of World War II, the national
guilds made efforts to bring about control of rising prices, the develop
ment of equitable systems of rationing, and the improvement of depleted
diets; they cared for refugees and injured people; and they prepared
propaganda for a peaceful and better world.
In 1943, the I. C. W. G. published a Memorandum on Post-War
Relief.
588544°—44----- 4
42
Comparative A nalysis
T a b l e 12.— Activities o f Affiliates o f International Cooperative W om en's Guild
Country
Year of for
mation
Year ol
affilia
tion to
I.C.W.G.
Australia...............
Austria*2_
3_________
1937
1914
1938
1921
Belgium__________
1923
0)
Bulgaria__________
193
-Canada....................
<»
•Czechoslovakia:4*7
9
8
Czech........ ........
1926
1927
G erm an...____
1923
* 1930-34
England__________
1881
1921
1931
1939
Estonia___________
(*)
1940
Finland___________
France.....................
0)
0)
* 1938-39
1937
Ireland_____ ______
1906
0)
Netherlands •---------
71897-1900
1921
New Zealand______
Norway_______ . . . .
1937-38
1910
Boland:
Polish................
Ukrainian__ __
Q
W
1933
Rumania_________
Scotland----------------
? 1937-31
1892
0)
0)
Sweden_______ ____
1906
0)
Switzerland-----------
1913’
1921
•Union o. Soviet So
cialist Republics.
0)
1921
United States_____
<*)
1941
1938
*1927
0)
Special activities
Cooperative propaganda for associations and wholesale.
Cooperative propaganda; courses of instruction for women
and youths; publications; active support of public kitchens,
councils, etc.; service on cooperative executive committees;
national food council.
Improvement of nutrition; improved housekeeping; opposi
tion to food taxes; cooperative education of children: support
of temperance movement and of disarmament
Medical consultation centers; holiday homes and kindergar
ten; courses in cooking and sewing; cooperative propaganda;
investment of cooperators’ savings in cooperative move
ment; disarmament petition.
Promotion of regional women's federations; farm women',
groups.
Cooperative education (foods, health, cooperative produc
tion); cooperative propaganda increasing sales: disarma
ment petition.
Lectures on laundering, dressmaking, etc. cooperative propa
ganda; service on executive boards.
Promotion of economic and social reforms to improve position
of women; reduction of cooperative entrance fees, to permit
poor to join; campaigns for healthy homes, mothers' welfare,
medical attention for school children, hospitals &nd na
tional health insurance; program for world peace.
Courses on gardening, domestic economy: education oj
women.
Reconstruction work.
Office of advice and information for women cooperators
information bulletin.
Campaigns for medicai inspection in schools, feeding of needy
children, better housing, and for world peace.
Cooperative propaganda, particularly effective for the co
operative wholesale.
Support of trading activities of cooperatives.
Representations to Government, requesting care for needy
children, card rationing of food; promotion of temperance
and sale of nonalcoholic beverages: propaganda for peace;
operation of school.
Stimulation of interest in cash trading.
Cooperative propaganda and education to help agricultural
women market produce and improve housekeeping; edu
cational pamphlets.
0).
Instruction in physical hygiene, cooking, sewing, convalescent
home; service on municipal and Poor Law administrative
bodies; promotion o. lower prices, workers' housing, and
world peace.
Active opposition to credit trading; education in domestic
economy and international affairs, promotion of coopera
tively produced goods.
Inquiry on credit trading; promotion ol use ol cooperative
bank, of temperance, and of sale of nonalcoholic* beverages;
representation on women's consultative committee to Swiss
Food Ministry.
Inauguration of kindergartens, educational courses tor wom
en, membership funds for women; raising of standard of
living; bringing Asiatic and Mohammedan women to co
operative meetings and membership; service as engineers
department managers, presidents, etc., of ooperative
organizations.
Federation of 4 regional federations; school for women; farm
women’s groups.
*No data.
2 The Austrian Guild was disaffiliated "as a result of political changes in Austria" in 1938.
3A provisional National Guild Council in Canada was reported in 1939 to have applied for affiliation.
4The C zechoslovakian National Guilds were reported in 1939 as having dissolved.
8 Affiliation took place in period noted; exact year not reported.
3 The Netherlands Guild ceased membership in the I. C. W . G. in 1935 because of the dissolution of the
Dutch Guild.
7 Formed during period noted; exact year not reported.
8Year of first attendance at Congress.
9 Reported in 1939 to have applied for membership.
D evelopm ent and Characteristics
43
Other International Activities
Baltic union.— Since 1924 the cooperative movements of Estonia,
Latvia, and Lithuania have collaborated in a series of joint conferences
held at intervals of 1 to 4 years. At these conferences were discussed
such questions as educational work, exchange of price information,
and extension of cooperation in various lines. As a result of the 1928
meeting, a Baltic Union was formed, to act as center of information
and publicity, collector of statistics, and organizer of studies of
various matters of cooperative interest.
The latest such conference was held in Tallinn in June 1940.
Yugoslav-Bulgarian Cooperative Institute.— In 1937 the national
consumers’ cooperative organizations of Bulgaria and Yugoslavia
formed a nonpolitical institute for the purpose of creating a perma
nent basis of cooperative collaboration between the two countries, and
o f promoting mutual economic assistance. This organization has
probably been a casualty of the war.12
12
Sou rces .—International section is based upon lata from the following publications: Review of Inter
national Cooperation (International Cooperative Alliance, London), issues of April 1932, January, March
April, July. August, September, and November 1937, January, May, June, September, and October, 1938,
January, July, and September 1940, February and July 1941, April, June, and December 1942, NovemberDecember 1943, January and February 1944; People’s Yearbook (Cooperative Wholesale Society, Manches
ter, England). 1930, 1933, 1934, 1936 through 1941, 1942, and 1944; International Directory of Cooperative
Organizations (International Labor Office), 1939; Cooperative Information (International Labor Office),
No. 5, 1928, and No. 1, 1929; Cooperative Consumer (North Kansas City, M o.), July 16,1940; House
wives Build a New World (International Cooperative Women’s Guild, London, 1936); Low Prices or High
Dividends? (International Cooperative Women’s Guild, London (1927?)); Good Food and How to Get It,
an international report on food purity, food values, and the cooperative movement (International Coopera
tive Women’s Guild, Lpndon, 1927).
Part 2.— Development of Cooperatives in
Individual Countries
Countries o f Western Europe
From its beginning in Rochdale, England, in 1844, the consumers’
cooperative movement spread to the continent of Europe where it
took root, with certain modifications to meet local needs or national
characteristics or tendencies. Whereas one of the principal tenets of
the pioneers in Great Britain was that of political and religious
neutrality, the movement in Belgium, France, and the Netherlands
was characterized by divisions along both political and religious
lines. In all these four countries and in Switzerland the consumers’
cooperatives consisted largely of urban industrial workers, though
farmers and persons of other classes were also included. In Luxem
burg, on the other hand, cooperation was almost entirely rural, and
even the consumers’ cooperatives combined distribution of home
and farm supplies with marketing of farmers’ produce.
Belgium became famous for its cooperatives’ use of their earnings
to support various welfare activities, including the renowned “ People’s
Houses,’ which were the gathering place for members and nonmembers
alike and often became the center of comnciunity life. Such use of
cooperative earnings became known in the cooperative movement
throughout the world as the.“ Belgian plan.”
The cooperative movements in Great Britain, the Netherlands,
and Switzerland grew in an atmosphere of peace, and were subject
* only to the vicissitudes entailed by economic and social events.
In France, Belgium, and Luxemburg, on the other hand, cooperative
development has been twice interrupted, during the past 30 years,
by direct enemy invasion and warfare, with all the destruction and
loss that this connotes.
In the present war, Luxemburg has been forcibly incorporated into
Germany. Switzerland, an island of peace in a sea of warfare, has
retained its national entity and autonomy, but has been obliged
to adopt sweeping social and economic controls. The Netherlands,
which escaped invasion in the first World War, was not so
fortunate in the present war.
In Great Britain and Switzerland the cooperative movement is
playing an important part in the national economy, although it
must be constantly on the alert against attacks from various sources
(mainly private business) intended to weaken it. In the other coun
tries, it is believed that the movement still exists, although the Ger
mans have made drastic changes and control it closely.
44
British Isles
45
Cooperative Movement in the British Isles
The consumers’ cooperative movement in its modern form had its
inception in Rochdale, England, in December 1844. From the small
beginnings of the well-known Rochdale Pioneers the movement has
grown until today it serves some 11,000,000 families. The Coopera
tive Wholesale Society is by far the largest industrial enterprise in
the British Isles and the Scottish Cooperative Wholesale Society is
the largest enterprise in Scotland.
It is a well-organized movement that reaches to practically every
corner of the country and its various branches are coordinated by a
central body, The Cooperative Union, through which educational,
propaganda, legal, and political activities are carried on. To some
extent the British movement has departed from the traditional
Rochdale practice of political neutrality. It is still neutral, in the
sense of not allying itself with any existing party. It participates in
the political field, however, for it has formed its own party— the
Cooperative Party. It had become increasingly evident to British
cooperators, over the years, that a never-relaxing vigilance was neces
sary as regards legislative and public administrative action, in order
to make sure that the cooperative movement should not be discrim
inated against by inadvertence or by measures submitted by its
enemies. After long discussion, they finally came to the belief that
the best means of insuring cooperative safety was through some agency
the chief duty of which would be to examine all public measures from
this point of view and to work for the election or appointment of
cooperators to public office. They, therefore, formed the Cooperative
Party which is an organization auxiliary to the Cooperative Union.
The retail associations provide not only groceries and merchandise
of many kinds, but also a great number of services, such as laundering,
burial, etc. Insurance and banking are provided on a national scale.
The movement has also gone into production of a wide variety of
commodities needed by the members.
Like all other business the cooperative movement has suffered
through bomb damage, shortages of goods, equipment, and man
power, and the restrictions imposed by war conditions. Operating
in a democratic country as it does, although in certain instances it
has felt it was the victim of discriminatory practices or decisions, it
has been able to make its protests felt and, usually, to obtain redress.
It has been able, notwithstanding all the difficulties of wartime, to
extend both its membership and its business steadily. Thanks to
the integration of the movement and the machinery provided for
rescuing associations in difficulties, British cooperatives almost never
fail and cooperators rarely suffer financial loss.
T ypes o f Associations
The relative development of the cooperative movement in Great
Britain in 1937 (the latest year for which figures covering the whole
movement are available) is shown in table 1. These figures are based
upon data collected by the Registry of Friendly Societies and relate
to associations registered under the Industrial and Provident Societies
Acts. The figures are open to the objection that they include some
organizations that are not entirely cooperative. This is especially
46
Cooperatives in Individual Countries
true of (1) the building associations, which correspond to the savings
andLloan associations in the United States and are only semicooperative,
and (2) the housing associations, which can be termed cooperative
only in the widest sense of the word.
Many have been promoted, and are financed (apart from State loans and loans
from local authorities) and controlled mainly by public-spirited persons interested
in housing; while others are run by employers in the interests of their employees.
Almost three-fourths of the societies provided houses for renting, and tenant
shareholders represented approximately one-quarter of the total membership.1
This group includes, however, housing provided by retail cooperative
associations, to the value of about £3,000,000.2
T
able
1.— M em bership and Operations o f Cooperatives Registered Under F rien dly
Societies A ct in England, Scotland, and W ales, 1937
[For par values of currency, see Appendix table, p. 278]
Type of association
Num
ber of
of
asso Members Amount
business
cia
tions
Net gain
Own pro
duction
Patronage
refunds
Consumers*
* cooperatives:
Retail distribution____ ________ 11,133 18,002,000 £248,273,000 £29,665,000 £43,060,000 £22,953,000'
Wholesale distribution_________
3
1,255 150,596,000 • 3,017,290 49,143,000
>2,786,000
8,021,000
Productive associations *___________
8,021,000
116
(<)
<<>
(0
Agricultural associations:
12,164,752
91,582
307,783
265
Supply______ _________________
47,004
143
45,428
Marketing............................. ........
5,911,408
899
174,829
13,495
Farming..........................................
36
722
96,949
>123,136
Service and allotment..................
153,488
Fishermen’s purchasing and market
77,132
43
2,710
1,387
ing cooperatives................................
>1,089,819
115,345
Housing associations •.........................
356
38,438
Building associations •........................
977 2,083,939 •136,855,953 29,613,843
8
1
* General supply associations only; does not include 55 in special lines.
> English and Scottish Cooperative Wholesales only.
* Includes both workers* productives and productive associations of consumers* cooperatives.
4 No data.
* Allotment associations only.
* Associations providing living accommodations for members; dwellings mainly rented.
> Bents received.
* Associations of type known in United States as building and loan associations.
* Amounts loaned on mortgage during year.
As the table indicates, the distributive cooperatives dwarf all the
other branches of the movement. Further, British cooperation
reveals most of the standard types of associations, with a few out
standing exceptions. Insurance, for example, is supplied through
one association of nation-wide scope. Credit unions appear to have
no prototype in Great Britain, although there are some agricultural
credit associations corresponding roughly to the production credit
associations of farmers in the United States; and some retail coopera
tives make mortgage loans from their surplus funds. The absence
of electricity and telephone associations probably is due to the fact
that British law bars cooperatives from providing rail transportation,
water, or power. The absence of other types of service associations
arises from the retail associations, practice of providing services—
burial, meals, laundering, etc.— as well as consumer commodities.
Agricultural cooperation.— Agricultural cooperatives in Great Britain
date only from about 1900 when the British Agricultural Organization
Society was formed. The tardy appearance of the agricultural co
i Great Britain, Ministry of Labor Gazette (London), January 1939, p. 10.
* For par values of currency, see Appendix table, p. 278.
47
British Isles
operatives is said to have been due (1) to the fact that ordinarily the
British farmer had no difficulty in disposing of his produce and (2) to
his “ more than average antipathy” to association.
Workers1 productive associations.— This type of association is not
particularly strong in Great Britain. Most of these associations are
engaged in the manufacture of clothing or footwear, or in the printing
trade. They differ widely in the extent of worker control which is
the distinguishing feature of this type of association. However, only
associations which do have some measure of control of operations
and policies by the workers in them are admitted into membership
in the Cooperative Productive Federation3 (established in 1882) which
is the central organization for marketing the products and protecting
the collective interests of the group.
In 1935 there were 54 workers’ productive associations in Great
Britain, of which 43 were members of the Federation.
The chief customer of many of the workers’ productives is the retail
cooperative movement. The latter also contributes to the financing
of these associations and in some cases has representation on their
boards of directors. Indeed, British students of cooperatives have
expressed the opinion that the survival of these productive associa
tions is due largely to the “ protected market” they enjoy in the retail
cooperatives.
The value of the output of the workers’ productive associations,
disposed of through the Federation in 1940, amounted to over 3%
million pounds. As table 2 indicates, the Federation’s membership
has remained almost constant, but since the depression its businesshas (with the exception of the year 1938) shown a continuous rise.
T a b l e 2 .— Membership and Business o f Cooperative Productive Federation, 1920-40*
[For par values of currency, see Appendix table, p. 278]
Year
1920..
1926..
1930..
1931.
1933..
1934..
Number
of affili Member
ship
ated asso
ciations
46
42
43
43
44
42
0)
14,480
14,966
15,187
15,801
15,791
Business
Year
£555,652
2,257,273
2,745,145
2,635,871
2,459,410
2,584,416
1935______________
1936.........................
1937.........................
1938.........................
1939.........................
1940_____________
Number
of affili Member
Business
ship
ated asso
ciations
43
44
44
42
42
42
15,162 £2,723,849
15,208
2,831,324
15,221
3,035,943
14,514
2,876,270
3,027,666
14,248
14,646
3,554,931
1 No data.
Structure o f the Consumers’ Cooperative M ovem ent
The basic or primary units of the consumers’ cooperative movement
in Great Britain are the local or retail cooperatives. Upon this founda
tion— a network stretching to practically every part of the Kingdom—
have been built (through the federation of the local associations)
national or regional organizations providing a great variety of services
and producing a wide range of commodities.
* There is another federation known as the Labor Copartnership Association which is sometimes confused
with this Federation but which has for its purpose the extension of profit sharing by industrial firms. This
confusion is increased by the fact that workers’ productive associations, which in addition to their worker
members also admit to membership retail cooperatives and other associations, are sometimes referred to as
“ copartnership associations.”
48
Cooperatives in Individual Countries
These federations, which in Great Britain are termed “ federal” as
sociations, are of four types:
(1) The national wholesale associations which are federations of local
associations for the purpose of doing a wholesale business in the goods
dealt in by the retail cooperatives.
(2) Separate organizations formed by the wholesale associations to
specialize in certain fields, such as insurance, tea trade, etc.
(3) National federations formed by the local associations to carry
on specific activities. These consist of the Cooperative Press, Ltd. (a
federation with some 695 member associations), which publishes sev
eral national cooperative periodicals, and the Cooperative Printing
Society (both in England), and three organizations in Scotland—
United Cooperative Baking Society, Paisley Cooperative Manufac
turing Society (which makes clothing), and the Scottish Cooperative
Laundry.
(4) The federations known as “ local federal societies,” formed by
groups of retail associations to carry on specialized activities through
out a given region. 4 In 1935 there were 44 such federations in Eng
land and Wales and 7 in Scotland. Most of these are in the baking,
dairying, or laundry trades.
At the top of the whole structure is the Cooperative Union, an
educational federation that accepts into membership both consumers’
and other types of cooperatives and also the commercial and produc
tive federations.
T a b l e 3.— Operations o f Cooperatives in Great Britain and Northern Ireland and o f Those
Affiliated to Cooperative Union , 1913-41
[For par values of currency, see Appendix table, p. 278]
Total: Great Britain and Northern
Ireland
Year and type of association
Num
ber of
asso Members
cia
tions
Sales
Cooperative Union
Num
ber of
Net earn mem
Their
ber
ings
asso members
cia
tions
Their
sales
mi
Distributive associations..........
Distributive federations___ . . .
Productive associations. ..........
Special associations..................
Wholesale associations.............
Insurance associations..............
Other associations.....................
Total.................................
1,059 8, 773,255 £302,246,329
224
3 197
2,255,055
90
18.759
8,768,737
10,166
2 16
1,276,050
4
3 1,593 185,155,689
32
1
10,463,401
13
(9
(9
1,207 8,803,972
1940............................................... * 1,20018,747,380
1935..
.................................
0)
7,526,200
1930............................................. ,
1,334 6,447,813
1925..
.................... ........... 1,420; 4,960,883
1920...............................................
1,501 j 4,559,311
1915..
.................................
1,497 j 3,310,724
1913............................... ............... 1,508 3,011,390
0)
<9
£890,122
0)
(9
<9
<9
1,006 8,636,653 £297,065,247
23
3 191
2,225,096
85
17,396
8,607,594
14
7,302
1,031,913
4
1,593 185,155,689
32
1
10,463,401
13
<9
(9
510,165,261
1,146 8,663,137
504,548,940
502,041,056
(9
351,646,360
(9
340.476,680 30,230,187
295,828,010 ! 23,211,134
404,144,150 26,993, 396
165,034,195 17,003,956
130,035,894 14,260,414
1,132
1,177
1,221!
1,283 1,322
1,285
1,272
495.629.847
353,221,819
333.362.847
8,580,423
7,365,886
6,253,734
4,864,888
4,479,209
3,187,285
2,874,574
<9
1
1 No data.
2 Estimated on basis of Cooperative Union affiliates.
3 Number of affiliated associations.
* Includes estimates (on basis of Cooperative Union statistics) for distributive federations and special
associations.
4 These correspond to the district wholesale or service federations in the United States.
British Isles
49
Table 3 shows the associations in the United Kingdom (Great
Britain and Northern Ireland) in 1941, and the associations that are
members of the Cooperative Union. For comparative purposes,
totals for preceding years are also given. This table shows a steadily
decreasing number of associations, a continuously mounting member
ship, and sales that have fluctuated somewhat with economic condi
tions but on the whole trend upward.
Retail Cooperatives and Their Operations
Specialization by local cooperatives is unusual in Great Britain
where the tendency has been rather for the retail store association
to extend its business to cover as many lines of commodities and as
many services as the membership desires. Thus, in the group of or
ganizations classified as “ distributive” are many which perform func
tions outside the purely merchandising field. Among the services
provided are burial, optical, dental, and convalescent care, laundering,
house decoration,-automobile repair, motor tours, and provision of
meals. In the merchandising section, some associations run estab
lishments providing a complete line of dry goods, clothing, furniture,
and the other commodities found in department stores; others may
concentrate on a limited range of day-to-day requirements. Furni
ture departments have been stimulated by the entrance of the whole
sale associations into the manufacture of furniture. Pharmacies are
becoming an increasingly common department of the retail cooper
atives. However, throughout the movement as a whole the grocery
department has always been and still remains the most important
section of cooperative trade. Data compiled by the Cooperative
Union show the following percentage distribution of cooperative
business in 1942:
Percent
Groceries and bread. _
Meat________________
Vegetables, fruits, fish
Dairy products______
Confectionery________
Drugs_______________
Dry goods___________
52. 8
8. 2
1. 4
10. 8
1. 2
1. 2
8. 3
Percent
Clothing (including tailoring)__
Boots and shoes__ _____________
Furniture and hardware________
Coal___________________________
Other__________________________
2.
3.
2.
5.
3.
5
1
5
1
0
Total__________ _______ _ 100. 0
Some of the retail cooperatives also run productive departments
making certain items (especially perishable goods like bakery prod
ucts, dairy products, etc.) which it is more efficient to produce locally
than on a national or regional scale. A few of the distributive asso
ciations have even gone into farming, although this has been one of
the least profitable or satisfactory lines of cooperative activity, and
the number of associations operating farms has tended to decrease.
One large segment of the cooperative movement in the United States
has no counterpart in the country that was the birthplace of consum
e d cooperation. Thus, although a few retail associations provide
garage service, there are no associations handling petroleum products
even though thousands of British cooperators possess automobiles or
motorcycles. Carr-Saunders and his associates pointed out this gap,
in their analysis of the British cooperative movement in 1938, and
remarked that “ Even America has cooperative petrol.” 58
8 Consumers’ Cooperation in Great Britain: An Examination of the British Cooperative Movement, by
Carr-Saunders, Florence, Peers, and others. London, George Allen & Unwin, Ltd.. 1938.
50
Cooperatives in Individual Countries
Trends in the membership, business, and net earnings of the retail
associations in selected years from 1880 to 1943 are shown in table 4.
T a b l e 4 .— M em bership and Operations o f Retail Distributive Associations in the United
Kingdom , 1880-1943
[For par values of currency, see Appendix table, p. 278]
N u m b e r of
associa
tions
Year
M em b er s
Sales
N e t earnings
1880.....................................................................................
1890......................................................................................
1900.....................................................................................
1910— ..................................................................................
1913-....................................................................................
1915......................................................................................
921
1,418
1,464
1,428
1,387
1,375
542,380
1,026,912
1,709,371
2,542,532
2,878,648
3,264,811
£ 2 1 ,0 9 3 ,3 2 4
26,619,566
50,053,567
71,861,383
83,590,374
102,557,779
£ 1 ,9 0 2 ,1 7 4
3 ,7 60,846
7,747,338
10,938,331
12,851,303
14,960,086
1920......................................................................................
1925......................................................................................
1930-....................................................................................
1935......................................................................................
1936......................................................................................
1937.....................................................................................
1,379
1,289
1,210
1,118
1,107
1,094
4,504,852
4,910,983
6,402,966
7,483,976
7,807,942
8,084,990
254,158,144
183,584,049
217,318,001
220,429,517
233,844,350
251,393,047
25,458,555
20,479,780
26,938,024
26,746,054
28,391,100
29,815,125
1938......................................................................................
1939......................................................................................
1 940 .....................................................................................
1941......................................................................................
1942......................................................................................
1943......................................................................................
1,085
1,077
1,065
1,059
1,058
8,404,688
8,643,233
8,716,894
8,773,255
8,924,868
9,028,218
263,265,306
272,293,748
298,880,990
302,246,329
319,448,476
331,547,123
31,144,045
32,019,854
0 )
0 )
2 28,896,977
2 33,120,928
0)
1 No data.
2 Surplus (after payment of interest on share capital) available for patronage refunds*
A veiy large proportion of the total cooperative trade is done by
associations of great size, serving extensive districts. In 1941, of
1,059 retail cooperative associations, there were 96 having more
than 20,000 members each; 30 of these had over 50,000 members and
6 had over 100,000 members. The 96 associations in that year
accounted for 9.1 percent of the total retail membership and 61.6
percent of the cooperative retail business.
The membership of the six largest associations in 1942 was as follows:
M em bers
M em b ers
London_____________
792,355 South Suburban (London)___ 200, 063
Koval Arsenal (London)_____ 318, 033 Liverpool____________________ 135, 878
Birmingham_________________ 238, 869 Leeds_______________________ 128, 766
Of these six, three (as noted) are in London. There is also a fourth
association in the London area, the Enfield Highway Cooperative
Society. Thus, nearly 1 %million families in the metropolitan region
are served by cooperatives.
It is estimated that the British cooperative movement handles about
12.0 percent of the national retail trade in food and tobacco and about
20.0 percent of the coal business. In the rationed foods (meat, butter,
sugar, etc.) the percentages range from 14.5 percent in the case of meat
to 27.0 percent for sugar and preserves.
A survey for 1940 indicated that cooperative factories produced
1.6 percent of the total output of all productive works in the United
Kingdom in 1935 and 7.1 percent of the output of the food and tobacco
industries, 3.4 percent of the furniture, 3.0 percent of the clothing, 6.5
percent of the shoes, 12.0 percent of the soap and candles, 12.5 percent
of the margarine, and 16.0 percent of the lams, marmalade, and flour.
51
British Isles
As population figures, since the beginning of the war, have been a
military secret no recent comparisons of cooperatives in relation to the
population can be made. In 1931, the consumers’ cooperative member
ship in relation to the total population was as follows:
P ercent o f
population
English counties.
Isle of Man_____
Guernsey_______
Jersey__________
W ales._________
Scotland________
Northern Ireland
. . 14.8
. . 9.5
1.3
7.3
15. 7
1.4
United Kingdom: 1931_______________________13.
1921.................
9.
1911....................................... 5.
1901.....................................
4.
4
5
8
3
1No associations or members.
The geographical distribution of the retail cooperative movement,
as regards membership and business, in 1942, is shown below:
Percentage distribution
M em bers
B u sin ess
87. 6
11.6
.8
81. 5
17.5
1.0
Total.................................................................. 100.0
100.0
England and Wales_____________________________
Scotland.............. ..........................................................
Northern Ireland_______________________________
Federations in the Consumers’
Cooperative M ovem ent
The principal cooperative federations in Great Britain operating
on a national scale are the four cooperative wholesales (English,
Scottish, Joint English and Scottish, and Irish), the Cooperative
Insurance Society, and the Cooperative Union.
The wholesale associations since their formation have widened the
scope of their activities considerably. Thus, the English and Scottish
wholesales not only act as wholesale distributors to the local associa
tions; they also manufacture much of the goods they sell, besides pro
viding insurance and other services and acting as the investment
agencies for the funds of the whole cooperative movement.
ENGLISH C O OPERATIVE W H OLESALE SOCIETY
This organization was formed in 1864 after two previous attempts at
cooperative wholesaling had failed. Most of the local associations in
England and Wales are members of it. The association has been
financially successful since its formation; and the only setbacks it
experienced were encountered during the two depressions of the early
1920’s and 1930’s. However, although money volume of sales has
fluctuated somewhat, during the 79 years’ operations a loss was
sustained on the operations in only 3 years (1918,1920, and 1921).
The wholesale began production very soon after its formation and
the productive enterprises have showed consistent earnings.
At the end of 1940 the C. W. S. owned 197 factories ana workshops,
employing 43,338 workers, which produced a wide variety of com
modities (see table 8, p. 29). It was operating 10 building and engi
neering plants and 6 printing and bookbinding establishments.
52
Cooperatives in Individual Countries
By 1939, the year of the outbreak of the war, the wholesale was
producing 35.4 percent of the goods it sold. Since that time, al
though both sales and production have risen, owing largely to war
conditions, the output of the C. W. S. factories has not expanded as
fast as the distributive business, so that by 1942 its own production
had fallen to 30.8 percent of total sales. Many of the cooperative
factories were reported to be “ engaged largely on the production of
Government requirements.”
The trend of development of the wholesale since its formation is
shown in table 5. Up to 1920 the number of its affiliates increased
each year; since that time it has fallen steadily, though gradually,
for the most part as a result of amalgamations of the societies into
larger units.
T a b l e 5.— M em bership and Operations o f English Cooperative W holesale Society, 1 8 6 5 [For par values of currency, see Appendix table, p. 278|
Year
Number
of affili Their mem
ated as
bers
socia
Share cap
tions
ital
Wholesale association
Business
Net gain
Own produc
tion
1865 ...................................
1870 ....................................
1880........................................
1890.......................................
1900.......................................
1910........................................
1915.......................................
(i)
0)
W604
941
1,078
1,160
1,195
24,005
79,245
361,523
721,316
1,249, C91
1,991,576
2,535,972
£7,182
16,556
14G, 061
434,017
883,791
1,740,619
2,284,758
£120,754
507,217
3,339,681
7,429.073
16,043,889
26,567,833
43,101,747
£1,850
4,248
42,090
126,979
289,141
462,469
1,086,962
£118,598
341,277
2,264,088
6,581,310
12,812,954
1920.......................................
1925______________________
1930...................... ...............
1931........................................
1932 . ....................................
1933................................. .
1934........................................
1,222
1,171
1,091
1,079
1,065
1,052
1,040
3,341,411
3,778,659
4,565,372
4,884,090
5,138,124
5,352,310
5,488,364
4,270,408
6,192,341
8,080,497
8,515,097
9,416,463
10,067,465
10,784,019
105,439,628
76, 585,764
89,288,125
85,313.018
81,498,234
82,769,119
82,120,864
2 64,210
1,053,504
1,396.974
1,344.218
1,692,157
1, 729,223
1,473,838
33.404,466
26,900,865
25,825,426
23,823,002
23,638,705
30,049,108
26,813,807
1935......................................
1936 ...................................
1937........................................
1938.......................................
1939.......................................
1940............ ..........................
1941......................................
1942—....................................
1943........................................
1,033
1,025
1,023
1,021
1,009
1,009
1,008
0)
5,983,810
6,155,964
6,379,274
6,581,337
6, 765,194
7,020,544
7,07.8,362
7,439,813
7,544,315
12,009,372
13,017,445
14,147,015
14. 715,179
14,734,826
14,740,954
15,859,540
0)
0)
90,177,672
98,283,975
107,691,527
119,851,542
125,015,316
131,357,439
142,889.444
157,395,338
166,835,000
2,052,498
2,095,481
2,569,412
2,799,095
2,891,485
2,974,722
3,890,388
0)
0)
32,449,932
36,346,873
40,994.814
43,303,528
44,243,924
45,037,707
47,098,301
47.406,257
(0
(9
i No data.
The wholesale has, in addition to its distributive and productive
business, several other departments. One of these is the C. W. S.
Banking Department which handles accounts for individual cooper
ators, for practically all of the local cooperative associations, for tradeunions, and for many nonprofit organizations. This department was
opened in 1872. Although it has several branches, for the most part
the retail associations act as its local agents. Through this depart
ment almost all the surplus funds of the movement are mobilized for
cooperative development. In 1937 the business of the Banking
Department for the year amounted to £770,106,000, and the assets
totaled £109,255,000.
The wholesale also has a health-insurance section, writing risks
under the National Health Insurance Acts, for cooperators and others.
British Isles
53
The membership of this section numbered 633,000 in 1942. From the
earnings made, the department also provides assistance toward dental
care, convalescent care, medical and surgical appliances, and nursing
for the members, as well as increases in the usual cash benefits provided
under the health-insurance system.
Retail activities of wholesale.— In 1934 the member associations
authorized the wholesale to form the C. W. S. Retail Society, for the
purpose of rehabilitating local associations that found themselves in
financial difficulties and of establishing retail branches in places where
cooperation either had not taken hold at all or where local associations
had been unable to operate successfully. In the latter case, it was
provided, no retail branch could be started without the approval of
neighboring cooperatives.
Two years later a branch was established in Cardiff, Wales, where
the local association had been unable to succeed. Between 1936 and
1943, the local membership of the Cardiff branch rose from 9,010 to
20,409. By 1943 the members of six other associations had voted to
become branches of the wholesale, and in the 8-year interval the
C. W. S. Retail Society had assisted and returned to local control a
number of other associations.
The Central Board of the Cooperative Union nevertheless felt some
concern for the proper safeguarding of local cooperation. Accord
ingly, in 1943, a joint standing committee representing the Cooperative
UnionaM thew^
Was formed. It will be the duty of this
committee to determine, in the light of all the circumstances in
individual cases, the best way of meeting the situation, i. e., whether
b y amalgamation of the association concerned with another associa
tion, by the transfer of its obligations to the wholesale, by internal
reorganization, by control by the wholesale or supervision by it, or by
incorporation into the C. W. S. Retail Society as one of its branches.
The committee's decision will then have to be ratified by the executive
boards of both the Cooperative Union and the Cooperative Wholesale
Society.
In 1939 the C. W. S. board of directors proposed to establish a
chain of fixed-price variety stores with a top price of 5 shillings; no
patronage refund would be paid. The system would not be started
until at least 20 associations had indicated approval, and no store
would be opened without the consent of the local association of the
district. Upon being put to the vote of the member associations, they
decided to allow the establishment of the system under the conditions
prescribed but refused authority to form a separate subsidiary organ
ization for the purpose or to eliminate the patronage refund.
SCOTTISH COOPERATIVE W H OLESALE SOCIETY
The Scottish Cooperative Wholesale Society, started 4 years after
its English counterpart, has always operated on a smaller scale, but
has been as consistently successful. Indeed, in one respect it has
outpaced the English wholesale, for it has shown a loss on trading
operations in only 1 year (1921).
Its development from 1868 to 1943 is summarized in table 6.
54
T
Cooperatives in Individual Countries
able
6 .— M em bership and Operations o f Scottish Cooperative Wholesale Society, 1869
to 1943
[For par values of currency, see Appendix table, p. 278]
Number Capital (in
of affili
cluding
ated as reserves and
sociations other funds)
Year
Business
Net gain
Own produc
tion
IRfiS - _____________________ . ___
1870 __
____________
__ _ ___
1880_______________________
1890...........................................................
1900...........................................................
1910..................................... ....................
1916..........................................................
(i)
(i)
161
261
288
274
262
£1,859
12,542
110,259
579,791
1,691,753
3,470,015
5,528,815
£9,697
105,249
845,221
2,475,601
5,463,631
7,738,158
14,499,037
£49
2,418
21,685
76,545
222,366
273,563
501,531
£108,646
1,388,720
2,435,311
34,708,104
1921...........................................................
1926..........................................................
1930...........................................................
1931..........................................................
1932..........................................................
1933..........................................................
1934..........................................................
1935..........................................................
273
260
251
251
245
241
240
238
6,733,753
9,008,221
10,433,879
11,113,064
10,995,204
11,590,726
12,244,400
12,995,916
21,834,058
16,717,922
17,682,449
16,552,348
16,141,552
16,016,360
17,664,855
18,635,116
3237,030
347,371
413,625
471,838
397,647
402,133
450,472
437,857
<9,540,728
3 5,949,289
5,793,827
5,053,045
0)
5,361,493
0)
5,421,240
234
13,870,232
20,580,212
529,329
5,996,484
232
230
227
225
221
0)
(«)
13, 530,537
13, 207,503
13, 021,494
13, 372,862
14, 597,921
14, 874,868
0)
22, 438,684
27, 350,453
24, 612,711
29, 184,889
32, 149,030
34, 044,052
35, 778,000
447,878
480,688
457,886
773,464
975,707
0)
0)
6, 612,000
7, 852,835
7, 132,330
8, 646,568
9, 816,972
0)
0)
1936...........................................................
1937...........................................................
1938........................................................................
1939.........................................................—
1940........................................................................
1941........................................................................
1942........................................................................
1943. ......................................................................
1No data.
* Figure relates to year 1915.
3Loss.
<Figure relates to year 1920.
• Figure relates to year 1925.
6 No data. Membership of affiliated associations given as 1,048,448.
ing figures were: 1942, 1,020,444; 1941, 999,093; and 1939, 954,245.
For previous years the correspond
The Scottish wholesale was somewhat slow in entering the field
of production but, once started, has shown almost continuous expan
sion, and indeed has been able to produce a greater proportion of the
goods sold than has the English wholesale. In 1941 the output of its
manufacturing plants constituted 35.7 percent of the total value of
goods sold by the wholesale. At the end of 1940 it owned 58 factories
employing 9,237 workers. It was operating also 4 building and engi
neering establishments, 2 plants making motor-car and wagon bodies,
and 2 printing and bookbinding establishments.
In order to take the advantages of cooperation to remote corners
of Scotland where the people did not wish to carry on cooperative
enterprises themselves or where conditions were not very favorable,
the wholesale has opened retail branches. In fact, the S. C. W. S. has
operated some retail branches since 1910. At the end of 1942 it had
41 retail branches, in addition to 26 retail drug stores, and 5 laundries.
One of the earliest of the special services was the funeral department
started in 1934; by 1942 this department was operating 33 funeral
establishments.
EN G L ISH
AND
SCOTTISH
JO IN T
C O O PER ATIVE
W HO LESALE
SO CIETY
This organization was formed in 1923 to carry on joint enterprises
for the two great wholesales. It has six tea factories in various centers
of England and Scotland, one coffee-roasting plant, and a cocoa and
British Isles
55
chocolate works, besides operating extensive tea and coffee plantations
in Ceylon and India. It maintains purchasing centers in various
places in Africa and Asia. In the year ending in September 1941 its
business amounted to £8,701,474.
IR ISH A G R IC U L T U R A L W H OLESALE SOCIETY
This association was formed in 1897 as the purchasing agent for the
Irish agricultural cooperative associations. It has had a checkered
career, owing primarily to the poverty of the member associations and
secondarily to the disturbed political and economic conditions in the
country. At the end of 1941 it had 362 member associations, and a
business for the year amounting to £751,761. (For statistics o f
operations, seep. 59.)
C OOPERATIVE IN S U R A N C E SOCIETY
Aside from health insurance, provided by a department of the
English Cooperative Wholesale Society, insurance for the cooperative
movement is written through the Cooperative Insurance Society
formed in 1867, which is the joint insurance department of the English
and Scottish Wholesales and has agents and offices throughout the
United Kingdom. It writes life, pension, annuity, fire, casualty, acci
dent, burglary, fidelity, “ house purchase,” employers’ liability, and
livestock insurance. One of the more interesting types of insurance
offered by the society is the collective life-insurance policy taken out
by cooperative associations on the fives of the members. The bene
ficiary of a member who dies receives an amount proportioned to the
average amount of his patronage of the cooperative during the preced
ing 3 years.6
The premium income of the society in 1941 amounted to £10,463,401.
A statement submitted by the cooperative movement to the Joint
Parliamentary Committee (known as the Beveridge Committee) in
1942 showed that over 255,000 cooperative employees were covered by
retirement schemes, and 786 associations (with 3,430,739 members)
had taken out the collective insurance just mentioned. Under the
latter scheme a total of £11,005,245 had been paid in 1,456,762 cases.
TH E COOPERATIVE UN ION
The Cooperative Union was established in 1869, under the name of
Central Board. It is the national federation of the cooperative move
ment in the British Isles, and accepts into membership both consumers’
and other types of cooperatives, whether of the primary or federated
type. All the four wholesales just described, the Cooperative Insur
ance Society, and the central organization of the workers’ productive
associations— the Cooperative Productive Federation—belong to the
Cooperative Union.
As already shown (table 3), practically the entire body of consumers’
cooperatives of Great Britain is affiliated to the Cooperative Union.
In 1941 its member associations accounted for 95 percent of the total
number of associations, 98 percent of the individual membership, and•
• In certain sections of the United States a similar plan is offered to members of store associations through
cooperative insurance (see Monthly Labor Review, March 1944, p. 561).
56
Cooperatives in Individual Countries
D9 percent of the cooperative business in the United Kingdom of Great
Britain and Ireland.
The Cooperative Union formulates policy and speaks the views of
the movement. Its duties include legal assistance to the member
associations, propaganda, educational work, and defense of the move
ment in the economic and legislative fields. It has certain auxiliary
Organizations, among which are the following:
(1) The National Cooperative Authority, representing the Union,
the English and Scottish Wholesales, the Cooperative Press, the
Cooperative Productive Federation, and the Cooperative Party. The
Authority decides upon cooperative policy in current national issues
affecting the movement, arising between congresses.
(2) The Joint Parliamentary Committee, the function of which is
to examine the possible bearing, on cooperatives, of all proposed
legislation, to represent the cooperative movement before Parliament
and Government bodies, and to obtain adequate cooperative rep
resentation on public committees.
(3) The Cooperative Party, described as the “ political committee”
of the Cooperative Union. It handles the funds subscribed for politi
cal purposes and endeavors to obtain the election of cooperators on
both local and national government bodies.
(4) The National Educational Council, responsible for advice and
guidance in the organization of cooperative education and the prepara
tion of correspondence courses and lecture courses at the Cooperative
College.
Cooperatives and the W ar
When the war broke out, the cooperative movement gave im
mediate attention to protecting its members as consumers. In order
to insure the equitable distribution of available supplies, cooperators
and their organizations were vigorous advocates of rationing and,
later, of the extension of rationing and of price control.
Government wartime measures, including limitations on supplies,
on production, atid on sales to consumers, and the control of prices,
began with the Prices of Goods Act of 1939 and the first Limitation
of Supplies Orders in April 1940. From that time onward, restrictions
were increased. Since the outbreak of the war Government regula
tions are reported to have been issued at the rate of 2,500 a year. By
the beginning of 1942 civilian goods were very scanty as compared
with the pre-war situation. Stores handling dry goods and clothing
were especially hard hit.
The earliest rationing measures were carried on what was called
the “ datum” quota principle. Under this system dealers’ quotas were
based upon their volume of business in the rationed commodity as
of a given date or period. This was an especial hardship for the
growing cooperatives, for amounts sold in the basic period were quite
insufficient to meet the current needs of the expanded membership.
This system was later abandoned— a fact to which the continued
growth in cooperative business in spite of restrictions and scarcities
is largely attributed.
The Government’s plans for the concentration of industry intro
duced a new and unforeseen element into the cooperative method of
doing business. These plans included the “ telescoping” of industry,
and were originally outlined as voluntary arrangements in which each
British Isles
57
branch of industry would decide which would be the “ nucleus” firms
and which the “ closed” or “ redundant” ones. “ Nucleus” firms were
to produce at full capacity. Accordingly, British cooperatives, for
probably the first time in their history, were forced to produce for
private enterprise or face extinction. Some cooperative factories
which were not permitted to produce for civilian consumption are
now engaged in making equipment, uniforms, and shoes for the
armed forces and civilian defense services.
Along with other businesses the cooperatives suffered extensive
bombing damage to their shops and other buildings, but prompt aid
from other associations and heroic efforts by the associations con
cerned enabled them to continue operations in most cases.
The evacuations that took place in 1940-41, as a result of enemy
bombing of the cities, operated to reduce cooperative business. The
reason for this was that the population movement was away from the
cities, where the cooperatives were strong, to country districts where
they were relatively weak. The result was a loss in registrations at
the cooperative stores in 1941. The tendency was reversed in 1942,
and cooperative registrations showed an increase despite the continued
decline of the civilian population. This increase is attributed “ almost
entirely to the resumption of trading membership by cooperators
moving back to the towns they left in the previous year.” 7
The position of the movement at the end of 1943 was regarded
as generally good and it was expected that, barring unforeseen and
extreme changes, this would be maintained in 1944.
The cooperative movement, although given greater recognition in
this war than in the last, has had to be on the alert constantly for
indirect attacks under guise of wartime necessities. Thus, the enact
ment of price-control legislation led the private traders to attack the
patronage-refund principle of the cooperatives as a price-cutting
device, and in some cases they have been successful in impressing
this point of view upon Government regulatory bodies. Although
certain members of Parliament have expressed the view that patronage
refunds should be suspended during the war, apparently no Parlia
mentary action toward this end has been taken.
On the whole, it is evident that the British movement is playing
an important role in the war economy. The strong financial position
of the movement and its enormous trading resources, together with the
fact that it represents a large section of the buying public, are un
doubtedly responsible for the public recognition which it has received.
Cooperation in Ireland
Agricultural cooperation has always been and still remains by far
the most important branch of the movement in Ireland. It developed
primarily as a result of the zeal of Sir Horace Plunkett and
the organization founded by him in 1894— the Irish Agricultural
Organization Society.
Although the cooperative idea was slow in gaining acceptance,
by 1913, owing to intensive organization work and the gradual spread
of the movement, there were 985 associations with a membership of
over 100,000. The first World War was a period of great expansion
; People’s Yearbook, 1943, p. 20.
588544*— 44------ 5
58
Cooperatives in Individual Countries
and prosperity for the Irish cooperative movement. In 1920 it
reached an all-time peak with 1,114 associations, a membership of
157,766, and an annual turnover of £14,604,852.
The post-war depression, however, revealed that the movement
was dangerously undercapitalized and overexpanded and that unwise
amounts of credit on a long-term basis had been extended. The
associations themselves were heavily in debt to the Irish Agricultural
Organization Society and to the banks. To these troubles were
added the political unrest and in some cases open warfare among the
various factions. The separation of the northern and southern parts
of the country into two parts—Northern Ireland and Irish Free State—
in 1922, likewise divided the cooperative movement. Thereafter the
Irish Agricultural Organization Society confined its activities to the
Irish Free State, and for Northern Ireland the Ulster Agricultural
Organization Society was formed. The two central organizations
maintained close relations, however.
The cooperative associations in southern Ireland were at the time
of the treaty of independence almost in extremity. The one exception
consisted of the cooperative creameries which, because they had been
more adequately capitalized and had enjoyed more efficient manage
ment, were in somewhat better condition than the other associations.
That the other branches of the movement were salvaged, even in
part, was due to measures of credit and reorganization undertaken by
the officials of the new Irish Free State.
Table 7 shows the development of the associations in membership
with the Irish Agricultural Organization Society in 1941 (the latest
year for which data are available) and in selected years since 1913.
The data for the years 1910 and 1920 relate to Ireland as a whole;
those for succeeding years cover Irish Free State (Eire) only.
T a b l e 7.— M em bership and Business o f Cooperatives in E ire , 1913 to 1941
IFor par values of currency, see Appendix table, p. 2781
Number oi
associations
Year and type of association
1941
.......
OrAATOArlAa
- .......
Agricultural supply associations
_
_
■jy/fiscAllariAonR trading associations. _
Credit associations:
Agricultural
Cooperatives under “ Fluke” scheme
Total
Federations
___
__ _
___
. _ _
Grand total _
1040___________________________________________________
1030 _________________________________________________
1033 _________________________________________________
1037 ________________________________________________
103fi _
____
____________________________________
1935__________________________________________________
1030 ... ___________ ________________________________
1023 ___________________ _____________________________
1020 *
______
_____
_____________ ______________
1013 a__________________________
_________
1No data.
>Data include Northern Ireland also.
Members
Amount of
business
214
82
20
51,402
17,680
15,771
£8,237,647
750,665
2,474,239
28
44
4,666
4,128
4,588
388
1
93,647
469
11,467,139
751,762
389
94,116
12,218,901
400
410
418
428
435
443
605
96,466
99,326
97,813
99,524
100,810
102,145
101,307
(»)
157,766
104,702
11,080,773
9,826,200
9,263,920
8,700,322
8,617,295
7,712,182
9,421,855
7,725,072
14,604,852
3,333,18'.
(\ l l 4
985
59
British Isles
The latest data available for Ireland that show the distribution of
the cooperatives between Northern Ireland and Eire are for the year
1936. In that year 435 of the total of 529 associations that were
affiliated to either the Irish or the Ulster Cooperative Organization
Society belonged to the former organization, and its affiliates accounted
for 100,810 of the total membership of 115,874 and £8,617,295 of the
total business of £9,881,295.
IRISH AGRICULTURAL WHOLESALE SOCIETY
The cooperatives of Eire also have a cooperative wholesale, the
Irish Agricultural Wholesale Society, formed in 1897, which handles
not only farm supplies but also household supplies and groceries.
This association, like the local associations, suffered from the civil
war and the depression of the early twenties. It was saved only
by the assistance of the English Cooperative Wholesale.
Only
summary figures, shown in table 8, are available for it.
T a b l e 8 .— M em bership and Business o f Irish Agricultural Wholesale, 1 9 1 5 -4 2
[For par values of currency, see Appendix table, p. 278]
Affiliated
associa
tions
Year
1016
1090
1925
JQ97
1090
1091
1099
_________
.................... .................
_______________
1934.......................................
327
625
588
698
470
470
470
468
Distribu
tive
business
£375,379
1,671,116
486,968
643,896
682,426
643,417
330,225
538,665
Year
____________
1935
1936______________________
1937
1933
______
1939
_
1940......................................
1941
_
______
1942........................ .............
Affiliated
associa
tions
469
466
373
373
373
366
362
360
Distribu
tive
business
£343,432
342,662
241,974
648,094
848,712
837,910
751,761
721,806
This wholesale is not entirely a federation of local associations.
Its member associations, it is reported, have never capitalized it
adequately and in order to obtain sufficient working capital it has had
to admit individuals into membership. Its leadership, in spite of
handicaps, has been characterized as “ courageous” and “ enterprising.” 8
The organization was able to break up the manufacturers’ combine
in the manure and farm-machinery trade and by importing these
commodities from the United States forced the prices of fertilizer
down by 50 percent. “ By making arrangements to have its own
seeds tested, it was able to certify them, and to compel private mer
chants to do likewise. The saving to the farmers under these two
heads alone would justify the society’s existence.” 8
CONSUMERS’ COOPERATIVES IN IRELAND
Consumers’ cooperation is much weaker in Eire than in Northern
Ireland. One reason for this is that the latter is more industrial
and in the British Isles the consumers’ cooperative movement has
always appealed most strongly to industrial workers.
In Eire, among the strongest consumers’ cooperatives are two
whose members are coal miners and textile workers, respectively.
The consumers’ association in Dublin, after repeated losses and reor
ganizations, finally went into dissolution in 1939.
8 Cooperation: A Survey of the History. Principles, and Organization of the Cooperative Movement in
Great Britain and Ireland, by F. Hall ana W. P. Watkins, p. 190. Manchester, The Cooperative Union.
1936
60
Cooperatives in Individual Countries
In Northern Ireland the consumers’ cooperatives, although not
numerous (there were only 17 in 1938) were quite large in size. Their
combined membership in 1942 was 75,722. One of the associations,
that in the city of Belfast, had over 50,000 members and 80 branches.
Its business in 1938 amounted to £1,591,739; its patronage refunds
in that 1 year amounted to £124,687.9
Cooperative Movement in Belgium
Belgium was occupied by the Germans in May 1940, after an 18-day
blitzkrieg during which much destruction of property, as well as loss
of life, occurred. Data are not available to indicate to what extent
•cooperatives suffered in the invasion nor how many of them were lost
when certain districts ceded to Belgium under the Treaty of Versailles
were reannexed to Germany. Evidently the cooperatives were
allowed to continue operation under the German military government,
for the allied army of liberation found them practically unharmed and
still under cooperative leadership in September 1944. It is known
that new organizations were created by the Germans to control agri
culture and the collection of farm products, and these may have sup
planted the cooperative supply and marketing associations.
When Belgium was invaded by the Germans n May 1940, the
Belgian cooperators saw their country overrun and the development
of their cooperatives checked for the second time in only a little over
a quarter of a century. Although suffering greatly during the first
World War, the movement, 10 years later, not only had regained its
pre-war level but had gone through a long process of consolidation
intended to strengthen and expand it. This process was hastened by
the stress of conditions during the depression of 1930-34. The struc
tural and economic reorganization that began in 1935 was successful
in putting the movement on a much firmer basis financially, and rapid
progress had begun to be made when war broke out. By that time,
the consumers’ cooperatives of all groups were serving about a fourth
of the people in Belgium, and were doing about 10 percent of all the
retail trade.
The cooperative movement in Belgium dates rom 1873, when the
first cooperative law was passed. The cooperatives, however, were
divided along both religious and political lines. In the distributive coop
erative branch of the movement, the only “ neutral” group consisted
of the associations of public employees. The others were affiliated
with the Clerical, Social-Democratic, or Christian-Democratic Parties.
9 S o u rc e s — The report on the British Isles is based upon data from the following publications: Great
Britain, Ministry of Labor Gazette, January and February 1939 and January 1940; Building Societies—
Statistical Summary, 1929-39 (Great Britain, Registry of Friendly Societies); Cooperative Review (Coopera
tive Union, Manchester), issues of November and December 1942, January, June, July, August, October
and November 1943, and January 1944; Wheatsheaf—Agricultural edition (Cooperative Wholesale Society),
issues of June and August 1943 and January 1944; Peoples Yearbook (English and Scottish Cooperative
Wholesale Societies) years 1922, 1927, 1929, and 1932 through 1943; Proceedings of congresses of the Coopera
tive Union, years 1881,1891,1901,1911,1914,1916, and 1938; Annual reports of Irish Agricultural Organization
Society for years 1931, 1938, and 1942; International Directory of Cooperative Organizations (International
Labor Office), 1939; Cooperative Information (International Labor Office), No. 7-8, 1943; Consumers'
Cooperation in Great Britain—An Examination of the British Cooperative Movement, by Carr-Saunders,
Florence, Peers, and others (London, George Allen & Unwin, Ltd., 1938); Cooperation—A survey of the
History, Principles, and Organization of the Cooperative Movement in Great Britain and Ireland, Dy Hall
and Watkins (Manchester, Cooperative Union, Ltd., 1935); Consular reports, March 21,1932, and Novem
ber 16, 1936; New York Times, June 27, 1939; Cooperative Builder (Superior, Wis.), October 7, 1939; Con
sumers’ Cooperation (New York), October 1943; and Economist (London), July 1, 1944.
Belgium
61
Among the workers' productive associations also, a large proportion
of the associations had Social-Democratic affiliations. Of the agricul
tural associations, the most important group consisted of associations
belonging to the Belgian Peasants' League (Belgische Boerenbond), a
conservative and entirely Catholic organization, in the administration
of which priests of the church played a predominant part.
Throughout the 70 years' growth of cooperation in Be’gium, not
only have these divisions persisted, but apparently not even friendly
relationships have been attained among the groups. Several times the
Social-Democratic associations made gestures in the direction of unity
or at least joint action. Thus, at their 1937 congress, these workingclass associations adopted a resolution favoring relations with the agri
cultural cooperatives for the protection of the cooperat ve movement
as a whole, against threatened harmful legislation; this appears to
have been without result. The Boerenbond and the central federation
of the Christian-Democratic associations worked together to some
extent, united by their dislike of the “ socialist" cooperatives, and
creating associations to compete with the latter. The one recorded
instance in which all branches acted together occurred in 1933 when
an unusually bitter attack was launched against the cooperative
movement.
Only with difficulty was distributive cooperation able to take root
in Belgium. It had to contend not only with the antagonism of the
private dealers, whose opposition dated from the establishment of the
very first cooperative, but also with the ignorance and inertia of the
exploited workers.
All branches of the cooperative movement in Belgium were inter
ested in the moral well-being of their members, but concern for their
political and economic emancipation appears to have been particu
larly characteristic of the working-class cooperatives of the SocialDemocratic group. Not only did the latter support the trade-union
movement in its fight for better conditions for the workers, but they
worked incessantly for the members' cultural and social welfare.
Indeed, many of the Belgian Social-Democratic associations bear
names which reveal their preoccupation with social aims, as “ Forward,"
“ Progress," “ Social Foresight," etc. The people's houses {maisons
du peuple), created as community centers and supported by the coop
eratives out of their earnings, became famous throughout the world.
T ypes o f Associations and Their Activities
The Belgian cooperatives have taken a variety of forms, including
two very uncommon types— the “ Nations" and the cooperative
pharmacies.
The official statistics divi e the cooperatives into the two broad
•classes— agricultural and nonagricultural associations. The latter
include the distributive associations, the cooperative pharmacies (to
some of which the sick funds were affiliated), the supply and marketing
associations, credit and housing-loan associations, as well as two types
of workers' productive associations— those running cooperative work
shops and the “ Nations," already mentioned. The latter (found
mainly at Antwerp) were dock workers' associations, each of which
tended to concentrate on longshore work for vessels of a given nation,
62
Cooperatives in Individual Countries
hence the name “ Nation.” Some of these associations are reported
to date back as far as the thirteenth century.
The agricultural group included associations purchasing farm and
home supplies, the cooperative dairies, and a group of credit associa
tions of the Raiffeisen type.
Between 1908 and 1922 the number of retail distributive cooperative
associations decreased (table 9), owing to the amalgamation of small
associations into larger ones, but the membership increased by over
50 percent and the amount of business done increased over fivefold.
All other types of associations increased their membership and business
but the greatest growth in business done was that of the credit
associations.
T a b l b 9. — Number, M em bership , and Business o f Nonagricultural Cooperatives in
Belgium in Specified Years, by T ype o f Association
fFor par values of currency, see Appendix table, p. 278]
Type of association
Num
ber
Mem
of
bers
asso
cia
tions
Num
ber
Amount of
of
Mem
business
asso
bers
cia
tions
1908
Amount of
business
1922
F ra n c s
Number of asso
ciations
1925 1929
1934 1938
F ra n c s
All types.............................
945 1324,700 1959,094,825 1,483 1517,122 15,327,495,810 2,056 2,474 3,168 3,482
Consumers' distributive..
Pharmacies........................
Credit..................................
Housing-loan......................
Insurance............................
Workers' productive........
“ Nations’*..........................
Industrial productive
Supply and marketing...
Miscellaneous....................
394 250,106 72,129,649
1.336.235
100
6
45 24,000 836,121,596
4,552,632
24
4,229
2,686,740
66 10,897
2,012,541
26
2,325
29
890
3.266.235
84
5,305 14, 716,359
82
6,686 12,120, 446
189 21,162 10,152, 392
464.942.000
353 386,708
6,288,326
10
671
83 33,192 4,231,861,521
31
10.403.000
4,328
61 12,897
10.874.000
12, 570, 963
8,502
39
955
36
37.991.000
252 12,227
50.934.000
464.787.000
217 17,456
411 40,186
27.844.000
386
12
129
107
54
43
37
433
292
563
377 362 360
40
15
16
157 221 203
128 127 125
61
67
72
51
53
57
42
39
43
505 655 697
350 412 454
791 1,213 1,431
1 Data relate only to associations that reported on this point.
3 Enterprises run jointly by private profit businesses; not usually considered as part of the cooperative
movement.
In the absence of comprehensive figures for later years, table 10,
compiled from various sources, shows for the distributive, workers'
roductive, and agricultural cooperatives the available data for numer of associations, membership, ‘and business. For the agricultural
associations, the figures shown cover all types. The information for
the distributive and workers' associations excludes some associations
not affiliated to any central organizations but which were in total
probably nowhere near so important in either membership or business
as the groups shown. There was also a group of associations belonging
to the Liberal Party, but they are described as “ negligible.” No
data whatever were available for the “ Nations,” the urban credit
associations, pharmacies, supply and marketing associations, or the
“ miscellaneous” group.
E
63
B dgm m
T a b l e 10.— Number, M em bership , and Business o f Belgian Cooperatives in Specified
Years
[For par values of currency, see Appendix table, p. 278]
Number of
associa
tions
Members
103
54
49
19
2,692
428,260
282,425
145,835
14,500
273,245
1,160,609,175
812,747,805
347,861,370
51.257,348
996,047,000
2,814
706,005
2,207,913,523
80
43
37
23
2,625
504.568
346.568
158,000
5,742
259,659
998,203,384
728,709,299
269,494,085
50,790,033
500,682,000
___________________________
2,728
769,969
1,549,675,417
Consumers’ distributive cooperatives............................................
Social-Democratic_______________________________________
Christian-Democratic.................................................................
Public employees (neutral)........ .............................................
Workers’ productive associations: Social-Democratic................
Agricultural associations: Catholic and other *............................
96
42
>20
34
22
2,625
585,023
349,559
75,000
160,464
5,589
259,659
1,047,217,618
657,694,618
80,000,000
309,523,000
55,121,212
1500,000,000
2,743
850,271
1,602,338,830
Year and type or affiliation of association
Amount of
business
tm
F ra n cs
Consumers’ distributive cooperatives........................................ .
Social-Democratic _
___________
_
Public employees (neutral).............................................. .
Workers’ productive associations: Social-Democratic................
Agricultural associations: Catholic and other *_..........................
Total__
_
1985
Consumers’ distributive cooperatives............................................
Social-Democratic . ..................
Public employees (neutral)3.....................................................
Workers’ productive associations: Social-Democratic................
Agricultural associations: Catholic and other *............................
Total__________________
1987
Total____
_
i Estimated.
* Data relate to 1929.
__________________
* Data relate to 1936.
* Data relate to 1934.
Development o f Distributive Cooperatives
To a considerable extent the history of consumers’ cooperation in
Belgium is that of the Social-Democratic associations, for they con
stituted two-thirds of the entire movement. The other third con
sisted of associations affiliated with the Liberal and Clerical Parties
and the neutral group of associations belonging to the public (civilservice) employees.
The Social-Democratic associations drew their membership from
the working class, and their progress was connected with that of the
trade-union movement and the Social-Democratic Party. In 1912 the
cooperative associations supported the general strike called by that
Party, in the movement to attain general manhood suffrage, and year
after year they contributed to the trade-union funds. The labor
organizations, on their side, strongly supported the cooperatives.
EARLY GROWTH
The first legal action authorizing the formation of cooperatives was
the law of Majr 18, 1873. By 1875 there were already 38 urban co
operative associations. Exact figures are lacking to show the growth
of membership and business from year to year. However, by 1908 the
nearly 400 distributive associations had over 250,000 members and
an annual business exceeding 72,000,000 francs.10 In 1900 they had
formed a wholesale association, Federation of Belgian Cooperatives.
10 For par values of currency, see Appendix table, p. 278.
64
Cooperatives in Individual Countries
DEVELOPMENT DURING AND AFTER WORLD W AR I
At the time when the first World War broke out the consumers’
distributive movement was gaining ground every year and had taken
steps toward a program of consolidation for stability.
The Belgian distributive cooperatives suffered greatly during
World War I. In the mass disorganization and unemployment that
followed the German invasion and the consequent stoppage of in
d u s t r y , the associations refunded to their members the greater part
of their capital. Many associations had their premises destroyed by
fire or bombardment, others were deliberately demolished or looted.
The remaining associations operated as long as they could, striving
to supply the people and to keep down prices. That their efforts
were understood and appreciated was indicated by the fact that new
members flocked to the cooperatives. One association alone recruited
over 1,300 new members in the first year of the war; another gained
over 5,000 new members during the war, and a third 12,000.
During the last 2 years of the war most of the associations were
unable to transact business because their stocks were requisitioned or
destroyed by the Germans. They endeavored, however, to keep the
organizations intact for post-war activity and employees were kept on
the pay roll even though sales were diminishing to the vanishing point.
At the end of the war Victor Serwy (one of the outstanding Belgian
cooperative leaders) described the position of the consumers, coopera
tives as follows: “ In our societies there are no longer any groceries or
provisions, fabrics, clothing or boots— not an article of general use.
Complete emptiness.” At the time he wrote this (end of 1918).
neither railroads nor postal service were yet in operation and the full
extent of damage was not known.
The policy of amalgamation, which had been decided upon before
the war, began to be carried into effect even before the Armistice, and
this was hastened after 1918. As a result of this merging process the
205 small associations which had been affiliated to the Belgian Co
operative Union 11 in 1912 were reduced by 1922 to 71, many of
which were of district coverage. By 1926-27 the number of affiliates
had fallen to 55.
Early in the twenties the movement also began to consider the
consolidation of the productive facilities that the wholesale and
numerous retail associations had undertaken. In 1924 a central
productive association, the General Cooperative Society, was formed,
to take over most of the factories already started and to branch out
into new fields. The production of perishable commodities, such as
bakery and meat products, and the provision of personal service, such
as shoe repair, was, however, left to local initiative.
Throughout the 1920,s, while the number of associations was grow
ing less, both membership and business continued to expand. A
change, however, had been gradually taking place in the business
activities. Traditionally, the workingmen’s associations in Belgium
started bakeries rather than stores. Before the first World War,
bread baking was still the most important line of cooperative activity
of the Social-Democratic associations. Every association, however
small, had its bakery. By 1930, owing to amalgamation of associa
11 Originally a department of the wholesale association, it was made an autonomous organization
shortly after the end of World War I.
65
Belgium
tions, there were only 65 cooperative bakeries in Belgium, and the
trade in bakery goods represented only about a fourth of the coopera
tive business of the Social-Democratic associations. In 1937 it was
reported that the sales volume in bakery products was also exceeded
by that in clothing, shoes, and beer.
By June 1927, the Social-Democratic cooperatives were serving
members in 1,231 of the 2,200 communes in Belgium. The 55 large
associations affiliated to the Belgian Cooperative Union were running
918 branches and 338 “ maisons du peuple.’ '
The cooperative wholesale (Federation of Belgian Cooperatives)
was also steadily increasing its volume of bus ness. Its own produc
tive activity was still small, as was also the volume produced by the
productive association (General Cooperative Society).
A summary of the operations of the Social-Democratic associations
affiliated to the Belgian Cooperative Union, up to the onset of the
depression, is shown in table 11.
T able
11.— Development o f Cooperatives Affiliated to Belgian Cooperative Union , 1912
to 1928-29
.[For par values of currency, see Appendix table, p. 278j
Year
Distributive associations:
1912..................................................................
1920.................................................................
1922..................................................................
1923..................................................................
1924..................................................................
1926-27............................................................
Associa
tions
205
54
71
76
54
55
Mem
bers
170,748
151,629
169,086
245,706
270,189
298,119
Savings de
posits
F ra n cs
Amount of
business
Patronage
refunds
F ra n cs
F rancs
(i)
v)
v)
v*/
191,156,898
223,604,164
47,513,587
0)
0)
257,172,069
416,820,351
677,143,921
0)
0)
755,364,402
772,156,324
12,551,892
21,637.959
N et gain
1927-28..........................................................
1928-29............................................................
Workers' productive associations:
1920 .. .
_____
1922_____________
1924______________________ ... .
1926-27_________________________________
1927-28______ ____ .
60 3 286,598
56
300,031
15
26
19
25
24
1,077
2,182
3,472
5,968
(l)
24,459,817
27,098,487
0)
(ij
15,086,527
18,452,728
* 20,000,000
!, 522
527,430
0)
1 No data.
* 40,000 nonpurchasing members were removed from rolls during the year.
* Approximate.
As table 11 indicates, the Belgian Cooperative Union also accepted
into membership workers’ productive associations. In 1926 a variety
of lines was represented in these associations; they were found in the
printing and publishing, brewing, construction, and tanning indus
tries, as well as in the manufacture of glass, cigars, shoes, and enameled
ware. By 1938, however, it was reported that about half of them
were in the printing trade.
Social and W elfare Activities o f D istributive Cooperatives
The accepted Rochdale practice is that the net earnings of co
operative associations shall be returned to the members in proportion
to their patronage of the association. Sometimes, however, the
members voluntarily forego these pecuniary returns and vote to use
the funds in other ways. The workingmen’s branch of the Belgian
consumers’ cooperative movement has always been a conspicuous
66
Cooperatives in Individual Countries
example of this, using a large part of the net cooperative earnings to
provide various social benefits for the whole membership or even for
the whole community.
One of the outstanding associations in Belgium as regards socialwelfare activities was “ Le Vooruit” at Ghent. This association, one
of the oldest in Belgium and well known to cooperators all over the
world, had just completed a new social-welfare building, costing over
$400,000, when the first World War broke out. The building con
tained not only a supply store and several restaurants on different
floors, but also a theater, a motion-picture hall, and various meeting
rooms. Among the welfare activities of the association were sickness
and maternity benefits and old-age pensions for members and em
ployees, and a disablement fund for employees which also paid bene
fits to the families of deceased employees.
The social spirit of the cooperators throughout Belgium was also
manifested in the so-called ‘ ‘people’s houses” {maisons du peuple 12)
which were at once cultural, social, and recreational centers. Cooperators, trade-unionists, and people of the community made use of
these centers. By 1930 there were 400 of these “ people’s houses.”
In 1936 a chair of cooperation, endowed by the Social-Democratic
associations, was established at the University of Brussels.
Work oj uLa Prevoyance Sociale.” — One insurance association served
the whole of the workingmen’s cooperative movement. This asso
ciation, formed in 1907, took seriously its name, “ La Prevoyance
Sociale” (i. e., “ social foresight” ) and its insurance work was only one
small part of its varied activities. Part of its earnings were returned
in patronage refunds on premiums paid by insured cooperative asso
ciations and the rest was used for various social purposes. In 1925
it purchased a 29-hectare 13 property, with accommodations for 65
children, and about 30 convalescent adults. Four years later it
purchased a seaside place— also for children needing special care for
tuberculosis— at which 60 children were accepted at a time for a
3-month stay, free of charge. The sum of 1,600,000 francs was spent
on these two homes. At these places the association maintained
laboratories for preventive medicine. It also collaborated with the
Red Cross in its work. In 1928 the association took part in the for
mation and financing of 5 associations for the building or purchase of
homes for workers.
In December 1934, it purchased another property, consisting of
about 35 acres of park, orchards, and woods, which it used for young
people and children needing treatment. Shortly afterward it under
took the construction of a 152-bed sanitarium for adult male tubercular
patients.
By 1937 this association was the largest insurance organization (as
regards number of policyholders) in Belgium; 1 in every 11 persons
in the country was insured in it. By that time it had abandoned its
requirement of membership in the Social-Democratic Party and had
opened its membership to all comers.
This association by 1937 owned seven properties, valued at
36,000,000 francs, and operated four medical advisory centers open
to members and the general public.*1
One of the large retail associations at Brussels was also known as “ Maison du Peuple.1
11 Hectare*52.471 acres.
13
67
Belgium
La Pr6voyance had reinsurance contracts with central cooperative
insurance organizations in Bulgaria, Hungary, and Great Britain.
It had also established a life-insurance branch in France.
In 1938 the association took the initiative in the establishment of
the National Institute of Social History at Brussels and undertook
to finance it to the extent of 250,000 francs a year. The purpose of
the institute was to collect and preserve records of the social and
economic history of Belgium, and establish contacts with similar
organizations in other countries.
The accompanying statement shows the expansion of La Pr6voyance Sociale. Up to 1933 the association wrote fire and life insurance
only; in that year it added accident insurance.
P re m iu m
income (francs )
1922.......................................................
1 9 2 6 ............
1927. .......................................
1928. ..........................................
1931 ..............................................
1932 .........
1936...........................................
3,790,000
14,977,609
16,582,117
20,377,736
39,616,323
35,050,000
51,874,000
Structural and Other Changes Necessitated b y the D epression
In spite of the depression the sales of the local associations continued
to increase through 1929-30. The next 4 years, however, showed a
continuous shrinkage of business, though not in the two main lines of
business— bakery products and groceries. This decline in turnover
reflected the unemployment and drastically reduced earning power of
the members. The savings of the members which had been deposited
with the associations declined by more than 40,000,000 francs from
1932 to 1933. At the same time, however, cooperative membership
was increasing, possibly reflecting the workers’ necessity to stretch
their money as far as possible. One of the large district associations,
the Cooperative Union of the Centre, failed during this period and
was taken over by a special “ management” association.
A further blow was the failure of the Belgian Labor Bank in March
1934. The bank was neither cooperative nor affiliated to the labor
movement but was a joint-stock enterprise formed by one local associ
ation with the idea of financing workers’ productive enterprises. Its
funds were mostly invested in these factories and it flourished as long
as they were prosperous. When, during the depression, they closed
one by one, the bank’s funds were thus frozen. The general bank
crisis and a campaign against the bank by the press hastened the end.
Having been organized by a cooperative association, the bank was
associated in the public mind with the cooperative movement. The
bank’s failure, of course, further reduced the purchasing power of the
workers (largely cooperators) who, together with many cooperative
associations, were its depositors.
With trade-union assistance, the Belgian Cooperative Union was
able to obtain a credit of 150,000,000 francs (guaranteeing the deposits
of the cooperative associations at the bank) from the Government.
It was apparent that drastic measures were needed if the movement
was to be saved. A great many of the local associations had, as
noted, been consolidated into district associations, the largest of which
68
Cooperatives in Individual Countries
(at Li6ge) had over 80,000 members. These large associations, com
prising only one-fifth of the total number of associations, had fourfifths of the savings deposits, nine-tenths of the share capital, and
seven-eighths of the total business of the workingmen's cooperative
associations. The other associations were small organizations, ranging
in membership down to only 15 persons. The practices of many of
these left much to be desired, and, n,s noted, even one of the large
associations had had to be taken over for reorganization.
In June 1934, at a special meeting of delegates convened by the
Cooperative Union, a National Council of the union was established,
having sections dealing with various phases of the problem (finance,
wholesaling, production, administration, accounting and audit, and
propaganda). With the intention of raising the efficiency of the
associations, reducing overhead expense, and standardizing practices,
the Council was invested with considerable powers of discipline over
the local associations, having the right to summon before it the man
agement of any association, to make recommendations for the improve
ment of methods and procedure and, in the event of the recommenda
tions being rejected by the management, to take the matter to a special
meeting of the local membership concerned. In the case of member
ship rejection of any of the Council's recommendations that had been
arrived at unanimously, the Council was given authority to expel the
local association from the Cooperative Union. Among the duties
with which the National Council was charged were those of making
sure that all the cooperative business went to the wholesale and the
general productive society, of establishing a uniform rate of patronage
refund, of merging associations where necessary, mapping out their
trading areas, and introducing uniform, improved commercial and
financial practice.
A further centralization was effected in 1934 and 1935 when the
congress decided to amalgamate the wholesale society (Federation of
Belgian Cooperatives), the Belgian Cooperative Union, and the cen
tral productive association under the name of the last of these (Soci6t6
G6n6rale Cooperative). The combined organization was to take over
the functions of all, namely wholesaling, production, and educational
work. At the same time a new association, subsidiary to the General
Cooperative Society, was formed under the name, “ Coop-D6p6ts,"
to act as a savings bank for all the associations in the Sodal-Democratic
branch of the consumers' movement; it was provided with paid-up
capital to the amount of 2,000,000 francs. The insurance association,
La Pr6voyance Sociale, also became a subsidiary of the General Co
operative Society.
Inadequate capital had always been one of the hindrances to co
operative development in Belgium. (In 1920 the average share capital
per member was only 25 francs.) Another was the tendency to tie up
what resources there were in fixed assets— buildings, plant, etc. The
enthusiasm for “ people's houses" had led in some cases to the invest
ment of unduly large proportions of the associations' capital in these
buildings. One of the powers given to Coop-D6p6ts was the right to
prevent any association from making investments in fixed assets which
Coop-D6p6ts deemed unwise. The central body was given the right
of examination and audit of all associations' books and accounts.
It was also made responsible for the administration of the collective
liability of the cooperative movement for the Government credit.
Belgium
69
Although sales fell off in 1937, the financial condition of the associ
ations improved considerably and the amount of share capital was
steadily increasing; the average per member had increased to 90 francs.
At the same time that the movement was rearranging its internal
affairs, it was also under bitter attack from the business and traders'
groups. Undoubtedly, the difficult economic conditions were the
motivating influence behind these attacks.14 The chief complaint was
the entirely unfounded one that the cooperative associations were the
recipients of special exemptions as regards taxation. The consumers'
cooperatives (at that time embracing more than 2,000,000 consumers)
paid all types of taxes except on their patronage refunds. The asso
ciations contended, and had been upheld by the High Court of Appeal
of Belgium in 1920, that these represented not profits in the same
sense as profits made by the private dealers but (since the customers
were members and co-owners) were, in the language of the trial court,
“ only the reimbursement to the interested party of the overcharge o f
price consented to at the moment of purchase." The circumstance
that made it extremely difficult for the cooperative movement to ob
tain public recognition of this cooperative characteristic was that
there were many pseudo-cooperatives started by private business
which were taking advantage of the court's ruling, to evade taxation.
This campaign resulted in bringing together (for the first time of
which record was found) all the branches of the consumers' coopera
tive movement— the workingmen's cooperatives, the league of civilservice associations, and the Christian-Democratic associations— to
counter the attack.
In 1935, in what was described as “ the wind of demagogy" that was
passing over the country, many legislative bills were introduced, one
of which would have imposed crippling taxes upon the associations
and another would have limited the membership of cooperative asso
ciations to families with incomes of less than 24,000 francs ($816) a
year Both of these measures were inspired by the private retail
dealers, but the cooperatives, with the aid of the trade-unions, were
able to defeat them. The 1936 Congress of the Social-Democratic
associations directed the General Cooperative Society to study the
cooperative law, with the idea of recommending changes that would
prevent the incorporation of pseudo-cooperatives under its terms, and
approved a campaign to enlighten the public as to the cooperatives'
true position in payment of taxes.
Trend o f Development o f Retail and Central Associations
The operations of the Social-Democratic associations and their
central organizations during the depression and through 1938 are
shown in tables 12 and 13 and the statement on page 71. It should
be borne in mind that the Central Cooperative Union and the Federa
tion of Belgian Cooperatives (the wholesale) became departments o f
the General Cooperative Society under the reorganization plan adopted
in 1934. The merger of the union was effected in 1935 but several
years elapsed before the wholesale association's business was finally
taken over.
MThe 1930 census showed 1 retail enterprise for every 3 6 persons and in some localities the average was aa
high as 1 in every 26. Altogether there were 80,000 grocery stores—or 1 for every 100 persons. In the 6 years,
1932-37, 30*000retail traders went out of business, but just as many more were formed in spite of the depres
sion. Many, if not most, were operating on a shoestring and it was mainly from them that the opposi
tion to cooperatives arose.
70
Cooperatives in Individual Countries
Table 12 covers the operations of the local associations (distributive
and productive) affiliated with the Cooperative Union.
T a b l e 12.— Operations o f Cooperatives Affiliated to Belgian Cooperative Union9 1 9 2 9 -3 0
to 1 9 3 7 -3 8
[For par values of currency, see Appendix table, p. 278j
Asso
cia Members
tions
Year
Distributive associa
tions:
1929-30........................
1930-31........................
1931-32........................
1932-33........................
1933-34........................
1934-35........................
1936-37............... .
1937-38........................
Workers’ p r o d u c tiv e
associations:
1929-30 _____________
1 9 3 1 - 3 2 _____________
1932-33______________
1933-34______ 1______
1934-35______________
1930-37
_____
1937-33
_____
54
54
354
51
43
'43
42
40
282,425
288,276
298,779
306,685
290,866
346,568
349,559
«305,197
19
19
22
20
23
22
22
(i)
(i)
3,750
3,275
5,742
5,589
5,900
Savings
deposits
Share
capital
- F rancs
Fra n cs
C)
0)
0
(0
589,400,000
548,528,748
295,402,551
197,106,243
0)
0)
(0
22,987,261
23,423,187
28,423,285
30,874,110
31,094,134
(i)
(i)
11,036,571
9,813,449
10,004,504
9,905,675
9,222,910
Amount of
business
Patronage
refunds
F ra n c s
F ra n c s
812,747,805 *31,192,593
723,000,000 28,000,000
631,958,267 26,000,000
598,550,273 25,104,241
545,130,529 23,628,969
728,709,299 26,747,727
657,694,618 21,592,539
663,073,337 23,020,727
51,257,348
41,000,000
43,934,583
39,127,654
50,790,033
55,121,212
53. 722,352
Allocated
to social
welfare
F ra n c s
0)
14,600.000
10,998,065
10,829,891
10,461,076
17,526,505
11,852,450
10,788,091
N et earnings
(i)
0)
786,026
276,707
482,506
1,153,620
1,068,515
iN o data.
2Net earnings.
* 1930-31.
<1933-34.
* About 46,000 nonpurchasing members were struck from roster in this year.
As table 12 indicates, notwithstanding the troubles encountered by
the cooperatives, sizable sums were returned in patronage refunds and
spent for social purposes, every year. During the depression period,
1929-30 through 1933-34, a total of nearly 134,000,000 francs was paid
out in returns on patronage and nearly 47,000,000 francs was allocated
for social-welfare activities.
The trend of business of the wholesale is shown in table 13.
T a b l e 13.— Business o f Cooperative Belgian Wholesale (Federation des Cooperatives
Beiges), 19 01 -3 6
[For par values of currency, see Appendix table, p. 278J
Amount of
business
Year
ion
1908
ioia
1919
1090
______________
_____________________ —
,
____________
........ ..................................
,
___________
1091
1099
1093
109d
109R
________
___
_______
......
_____________
F ra n c s
769,360
% 995,617
11,245,682
15,869,276
55,510,869
65,405,071
72,403,234
100,380,818
124,343,476
141,913,153
Year
1926_________________________
1927_________________________
1928_________________________
1929_________________________
1930_________________________
1931_________________________
1932_________________________
1933_________________________
19361
__________________________
Amount of
business
F ra n c s
185,896,397
205,982,233
220,537,533
231,360,649
222,08a 488
190,175,539
183,000,000
186,655,531
146,800,000
<Last year of independent operation.
As already noted, with the exception of certain perishable goods, the
manufacture of which was retamed by the local associations, the
productive activity was more and more centralized in the General
71
Belgium
Cooperative Society. By 1927 it had 16 factories. By the time of the
general reorganization of 1935, combining wholesale, productive,
financial, and educational functions in the General Cooperative Society,
it was producing a fairly large variety of articles (see table 8, p. 28).
The association found, however, that the volume of sales of some of
these items was not sufficient for profitable operation. In 1937, there
fore, several of the plants which had been operating at a loss were
closed down, including the manufacture of soap (1 plant only), mineral
water, and hosiery.
Exact figures regarding the business of the General Cooperative
Society are very scanty. Those available are shown in the accompany
ing statement. Through 1936 the figures shown represent sales of its
own products. From 1937 onward the data include the wholesale
business taken over from the Federation of Belgian Cooperatives.
B u siness
(francs )
192619271929193019311937
1938
1940___
27.
28.
30.
31.
32.
_________
_________
21,
27,
36,
33,
27,
1 168,
2 164,
2 138,
175,
718,
840,
760,
000,
962,
156,
737,
449
846
814
842
000
034
000
000
1Includes wholesale business: goods produced totaled 27,000,000 francs.
* Includes wholesale business.
Consumers9 Cooperatives Just P rior to Outbreak o f W a r
Notwithstanding various political crises, the Belgian cooperatives
in 1938 were able to maintain their position, registering increases in
business, earnings, and share capital.
The 40 associations in the Social-Democratic group were serving
cooperators in 1,247 of the 2,671 communes in Belgium. They were
operating 1,129 stores, 60 bakeries, and 375 “ maisons du peuple.”
Their sales in 1938 amounted to 663,073,337 francs, distributed as
follows:
F ra n cs
Groceries and provisions____________________________ 249, 054, 649
Bakery products---------- ------------------------------------------- 176, 305, 035
Clothing-____________________________________ _____ 59,847,667
“ Maisons du peuple” ------------------ --------- ------------------ 22, 369,138
Theaters and motion pictures_______________________ 10, 752, 505
Furniture, household supplies, meat, coal, e tc_______ 144, 744, 343
The business of the General Cooperative Society fell off slightly
from 1937 to 1938.
Among the other national associations affil ated to the General
Cooperative Society were the National Association for Cooperative
Management, whicn takes over and operates local associations that
get into financial difficulties, until they are on their feet again; the
Centrale de Cinema, operating the motion-picture sections of the
maisons du peuple; the Maisons des Mutualistes, the central organi
zation of the sick funds, with nearly 100 drugstores; and the Central
Organization for the Sale of Radio Apparatus.
The civil-service employees7 cooperatives, dating from about 1880
and federated into La Societe Cooperative Federate de Belgique
72
Cooperatives in Individual Countries
(formed in 1890), had a combined membership of about 160,000 and
an annual business of over 300,000,000 francs.16 The business done
by their wholesale (formed early in the 1920’s after several unsuccess
ful attempts) amounted to about 38,000,000 francs. Very little
printed material is available regarding the Catholic or ChristianDemocratic associations, but the latter are reported to have had a
membership of about 75,000 and annual sales of some 80,000,000
francs. The Christian-Democratic associations had a central whole
sale organization, “ Bien fitre,” supplying groceries and bakery goods.
The Liberal group was reported to be very small.
Altogether, it appears that the Belgian consumers’ distributive
associations, before the outbreak of the present war, represented a
total of over 580,000 cooperators. Counting their families, the asso
ciations were serving about a fourth of the total population. The
combined sales (well over a billion francs yearly) represented about
10 percent of the retail trade of Belgium.
Cooperatives and the W ar
War broke out in September 1939 and by the middle of the month
mobilization of troops had begun in Belgium. Some of the coopera
tive employees were among the first to be called up, and the General
Cooperative Society immediately urged on all associations the forma
tion of a fund from which it recommended family allowances to be
paid to their families, amounting to 5 francs a day for the wife and
2.50 francs for each child; this was to be in addition to the State grant.
Belgium was invaded on May 10, 1940, since which time details
regarding the cooperative movement are lacking. It is known that
the business of the General Cooperative Society in 1940 decl ned to
138,737,000 francs, a drop of 15.5 percent as compared with 1938.
Local associations continued to operate and, according to the Coopera
tive News (Manchester, England) of September 20, 1944, the allied
army of liberation found the consumers’ cooperative movement
practically intact and still under cooperative management. Various
new organizations had been created by the Germans to control agricul
ture and the collection of the farm produce. How far these may have
superseded and eliminated the agricultural cooperatives is not known.14*1
8
18 Whereas the Social-Democratic associations served all comers, the civil-service associations dealt only
with members.
18 Sources .—1
The report on Belgium is based upon data from the following publications: Annuaire statis*
tique de la Belgique (Belgium, Office central de Statistique, Brussels), 1920,1922, 1926,1931,1932,1935, and
1937; La Cooperation Soeialiste beige, 1924 (Office coopSratif beige, Brussels); La Cooperation Socialiste
beige, 1926-27—Resultats du recensement op6r6 par les Soins de L’ Office cooperatif beige (Brussels); Bulletin
Mensuel du Parti Ouvrier beige (Brussels), July 7,1922; La Cooperation beige (Brussels), issues of October
15,1921, July 1,1922, February 1, July 7, and August 1,1923, December 15,1924, June 15,1925, and June 15,
1926; International Cooperative Bulletin (International Cooperative Alliance, London), issues of January
1911, September 1912, April 1913, August 1914, March and August 1915, February 1916, August, October, and
December 1918, January 1919, September and October 1920, and November 1923; Review of International
Cooperation (International Cooperative Alliance, London), issues of January and August 1924, Feb*
ruary and May 1928, February and October 1929, March and December 1931, October and December 1933,
June, July, and December 1934, January and July 1935, November and December 1936, June, October, and
November 1937, January, April, and August 1938, February, April, and November 1939, and January 1940;
People’s Yearbooks (English Cooperative Wholesale Society, Manchester), 1929,1930,1933,1934,1935,1936,
1938,1940,1941; Cooperative Information (International Labor Office), No. 5,1935, No. 13, 1937, and No. 1,
1940; International Directory of Cooperative Organizations (International Labor Office), 1939, and Report
from United States consul at Brussels, June 15, 1934.
France
73
Cooperative Movement in France
From its beginning the French cooperative movement was definitely
a working-class movement and reflected the struggles and ideological
divisions among the workers and the trade-unions. The social
thinkers of the times also put their mark upon the movement and
helped to steer it in one direction or another. The Socialist and other
Parties also tried to capture the movement and direct it for their
own ends. In 1912 a fusionist movement brought these groups to
gether, resulting in the formation of a national federation— Federation
Nationale des Cooperatives de Consommation—which adopted a
policy of political and religious neutrality from which it never devi
ated, although it many times declared its position for or against
legislative and other developments affecting the cooperative move
ment. Amalgamation of small, weak associations, begun before the
first World War and continued for a decade thereafter, strengthened
the movement decidedly.. The regional or “ development” associa
tions thus formed were by 1928 doing 47 percent of all the business of
Federation affiliates; by 1936 their proportion had risen to 69 percent.
In 1934 the consumers7 cooperatives were doing about 6 percent of
the retail trade in perishable groceries in France. Although urban in
origin, the consumers7 cooperative movement had attracted (largely
through the regional associations) an increasingly large number of
members in rural areas.
T ypes o f Associations
Most of the usual types of cooperatives were found in France.
That country, birthplace of workers7 productives, was also one of the
very few countries in which these associations were important. Some
of the workers7 productives, as for instance the association of the
workers in precision instruments in Paris, had attained real import
ance. Many of the buildings for the Paris Exhibition in 1936 were
erected by workers7 productive associations. France also had the
distinction of having a law embodying cooperative standards for such
associations, to prevent the tendency shown by this type of associa
tion in France and elsewhere to become closed corporations hiring
(and profiting by) the labor of nonmember workers.
The consumers7 cooperative movement, as exemplified by the
affiliates of the National Federation, were for the most part associa
tions dealing in groceries, though some also had clothing and general
merchandise departments. Some of the regional associations also had
restaurants, meat markets, and even pharmacies. On the other hand,
associations dealing only in bread were common, and there were
nearly a thousand the only function of which was to run a bakery. A
few breweries also were operated. Insurance in the consumers7 co
operative branch was furnished by a single association. Several dis
tributive associations operated vacation homes for children, at the
seaside and in the country, and one operated vacation hotels for adults
in resort localities. Among the workers7 productive associations
preventive care for children, in a pretuberculosis sanitarium, was
furnished by a special association. Family allowances were paid by
588544*— 44-----6
74
Cooperatives in Individual Countries
some distributive and productive cooperatives in France long before
the Government introduced its general compulsory system in 1934.
Credit cooperatives were little developed in France among the
urban groups that constituted the greatest part of the distributive
cooperatives. The urban “ people’s banks” —less than 100 in num
ber—provided credit mainly for tradesmen and small craftsmen.
Such credit facilities as were available in the consumers’ cooperative
movement were those provided through the savings departments of
the large regional associations and the Cooperative Bank of France.
In both cases, however, from the viewpoint of the individual coopera
tor, these were agencies of thrift rather than credit, as the funds were
used mainly for the development of cooperative enterprises and facili
ties rather than in loans to individuals. The agricultural credit
associations were only partially cooperative and depended for their
initiation and funds largely upon Government credit and advances.
Among the agricultural cooperatives there was considerable variety.
There were not only thousands of mutual-insurance associations, but
also purchasing associations, electricity associations, marketing organ
izations, and agricultural processing associations of many kinds.
Among the last group were dairies, distilleries, wine-making associa
tions, cider plants, sugar refineries, starch factories, associations
making olive oil, flour mills, and bakeries.
The agricultural cooperative movement was federated into the
Fdddration Nationale de la Mutuality et de la Cooperation Agricole,
formed in 1910. It had four sections dealing, respectively, with pro
duction and marketing, insurance and mutual aid, credit, and other
agricultural associations, and had subsidiary commercial federations
in these various fields.
In 1937, the latest year for which data for all types of associations
are available, the number and membership were as shown below:
Associations
M em bers
All types__________________________________ 90, 433
Distributive________________________ ______
Housing- .........................................................
Workers’ productives______________________
Credit, urban_____________________________
Credit, rural______________________________
Agricultural:
Mutual insurance_____________________
Marketing, purchasing, and other........ -
1 1, 200
437
648
97
10, 550
2, 671, 000
2 33, 000
2 31, 227
65,807
586, 372
50, 461
27, 040
2, 293, 838
2, 829, 361
*Data relate only to associations affiliated with central federation.
Relations with the Government
Credit facilities.— Subsidies or credits to various types of small
enterprises appear to have been a feature of French Governments of all
shades of liberalism or conservatism. Large sums were earmarked
each year for the use of small businessmen in all lines of industry.
Especially before 1900, the workers’ productive associations received
certain subsidies. Later the Government funds appropriated for
them were in the form of long-term loans. These associations
proved to be good risks and it was reported that losses on loans to
them were negligible. The Government was also one of the best
France
75
customers of these associations, and in some cases (as in associations
contracting for public works) the only one. In general, where
practically identical bids were made by a private contractor and a
workers' productive association, the contract would be awarded to
the cooperative.
From the beginning, agricultural cooperatives received outright
subsidies as well as loans. The funds loaned by their credit associa
tions consisted to a great extent of Government advances.
The consumers' cooperatives received much less help than the above
types. During and just after the first World War, funds were appro
priated to enable them to undertake certain tasks desired done by
the Government. It was reported in 1920 that the Government had
granted 10,000,000 francs17 to be used for the reconstruction of
cooperatives in devastated areas and 2,000,000 francs for the co
operative movement in general. Only a fractional part of the sums
so granted failed to be repaid, so that in the long run they were loans
only, not subsidies. Thereafter, Government credit was nearly
always available to consumers' cooperatives, though the total was
small in comparison to credit granted in other directions.
The consumers' cooperative movement, the motto of which is
“ self-help," was divided as to the degree to which such assistance
was helpful and the point at which it began to sap self-reliance. The
general manager of the consumers' cooperative wholesale pointed out
that the consumers' cooperatives had fully equaled the record of the
agricultural cooperatives as regards improvement of quality, stand
ardization of product, etc., “ without either credits or fiscal privileges
from public authorities." He added that “ the agricultural co
operative movement in France has, perhaps, asked too much from the
State, and received too much from it, and not enough from the
farmers. The restrictive character of agricultural cooperative
legislation has been the price of the encouragement the [agricultural]
movement has received from the Government. It would have done
much better with less money and more independence.'
Other governmental action in aid oj cooperatives.— The interest of
the various administrations was also manifested in other than finan
cial ways. In 1918 the Government created by decree a Superior
Council of Cooperation, charged with studying and advising the
Ministry of Labor and Social Welfare on all matters relating to the
development of the cooperative movement. It consisted of the
Minister as chairman, and representatives of the French Parliament
and other Government agencies, as well as of the various types of
cooperatives. This council was continued by all succeeding Govern
ments until the invasion in 1940.
In September 1920 a chair of cooperation was established in the
College of France. Charles Gide, noted cooperative leader, was ap
pointed to this place and occupied it until 1930, when he retired.
E a rly Development o f Consumers’ Cooperative M ovem ent
The revolutionary year of 1848 marked the real beginning of the
cooperative movement in France, although there had been a few
scattered attempts prior to that time. In the early periods of the
17 For par values of currency, see Appendix table, p. 278.
76
Cooperatives in Individual Countries
movement workers' productive associations, whose purpose was to
free the workers from employer control by making them masters of'
their own businesses, were the predominant form. Gradually they
were outdistanced by the consumers' cooperatives.
NATIONAL FEDERATION
As early as 1895 a schism had occurred. Certain Socialist-influenced
associations formed their own federation, and 5 years later withdrew
from the French Cooperative Union that had been formed in 1885.
In 1912 the two factions—Socialist and conservative— amalgamated
again and formed the Federation Nationale des Cooperatives de
Consommation,18 which (until the invasion of France in 1940)
continued to be the keystone and central educational body of the
French consumers' cooperative movement.
The “ Pact of Unity" signed at that time termed the Federation
“ an organization for the emancipation of the workers" and adopted
as one of the essential principles of its member associations that they
should “ set aside funds for social purposes and for the carrying out of
the cooperative program."
The Federation proclaimed its independence of any political or
religious party and thereafter became in fact a federation for the con
sumers' cooperatives throughout France. The members of the Feder
ation consisted of 17 regional federations, composed in turn of the local
associations in their districts.
Its development was interrupted to some extent by the first World
War, but by 1928 its affiliates numbered 1,450 out of a total of 3,513;
and their members accounted for 1% million families and an annual
business of over 2% billion francs.
The Federation's interests were many and varied. Through its
relations with the Parliamentary “ Cooperative Group" (composed of
Deputies in Parliament who were interested in the cooperative
movement), it kept in touch with legislative developments and voiced
the views of the cooperators. One of its achievements was a general
reduction in food taxes. Its newspaper and periodicals were circu
lated throughout France.
In 1913 the National Federation opened a school of cooperation
(later changed to school of apprenticeship) for the training of cooper
ative managers. This institution had to suspend operations during
the war but began again in January 1919. The Federation was also
responsible for the introduction in the educational institutions, at
all levels, of courses in cooperation.
Its technical office gave advice to cooperatives on many questions.
One of the sections of this office concerned itself with problems of
social hygiene, food preparation and consumption, and infant hy
giene. By 1919 the section had established an office in Paris from
which it was supplying local cooperative secretaries with data on
all of these subjects.
W orld W ar and P ost-W a r Development
The consumers' cooperative movement grew considerably during
the first World War. in the struggle to distribute provisions to the
« The two wholesales connected with these federations amalgamated at the same time.
France
77
people, the Government of France, the city of Paris, and other com
munities made use of the facilities of the cooperatives. In Paris a
special cooperative organization, the Union of Parisian Cooperative
Societies, was formed. It sold coal, controlled the sale of milk and its
byproducts, and distributed potatoes to persons in receipt of charitable
aid of various kinds. Later, at the requestof theMinistry of Munitions,
it undertook the operation of restaurants for war workers. At the
end of 1916 it was also operating in Paris 26 stores selling margarine,
veal, and certain frozen meats, and 15 such stores in the suburban
towns around the city.
All of these activities did much to publicize the cooperative move
ment, so that at the end of the war Charles Gide could say with truth:
“ There is now hardly a Frenchman who has not had the opportunity of
becoming acquainted with cooperation, and who does not cherish
grateful remembrances of its activities.”
Shortly after the signing of the Armistice the cooperative movement
of Alsace-Lorraine petitioned for membership and became a part of the
French cooperative movement. The latter was thereby augmented by
22 associations with 63,800 members and a yearly business of about
34% million francs. By the end of 1919 there were in operation in
France some 4,000 consumers’ cooperative associations, not counting
over 1,000 (in invaded districts) that had not yet been reestablished.
Notable progress had been made toward unification and concentration
of the movement, as well as toward improved efficiency.
A special type of cooperative was active during this post-war period,
namely associations for the reconstruction of devastated areas. The
first such association was organized in 1919. Four years later there
were 2,262 reconstruction cooperatives with a membership of 162,000.
It was estimated that these associations handled about 27 percent of all
the repair work and 58 percent of all the construction work carried out
in the devastated areas. In some regions their proportions ranged as
high as 76 percent
After a period of inflation in the early and middle twenties the French
franc was stabilized. One of the first effects was relatively widespread
unemployment, but within a year industry had been able to absorb
practically all these unemployed. The cooperative movement shared
in the upsurge of economic activity, and during the 2-year period from
1925 to 1927 cooperative business increased by more than 50 percent.
The national cooperative congress of 1913 had adopted a resolution
favoring the concentration of cooperative forces into regional associa
tions which would undertake to extend the cooperative movement into
new areas through the opening of branch stores and which would also
absorb existing associations wishing to become part of an organization
larger and more stable than themselves. By 1918 the movement
toward amalgamation was well under way and several “ development
associations” (as they were called) had been established, absorbing all
the smaller associations within an entire district or even Department.
The Union of Parisian Cooperative Societies, which as noted, had
evolved to meet a war emergency, changed its name to Cooperative
Union of Paris, absorbed the other local associations, and by 1919 had
become a “ development society” for the whole metropolitan district.
In its network by 1920 were 300 branches—grocery stores, meat
markets, restaurants, cafes, holiday homes, and a pharmacy. Its
78
Cooperatives in Individual Countries
membership of 55,000 and their families accounted for between 5 and
6 percent of the population of Paris.
At the end of 1924 there were 46 regional associations of this type,
with a combined membership of 565,000, some 2,600 stores, and an
annual business of about 600,000,000 francs. These associations
accounted for about a fourth of the combined turnover of the coopera
tives. The largest of the development societies, the Union of Coopera
tors of Lorraine, at Nancy, with a membership of 157,500, in 1937
operated 801 stores and had a business amounting to 347,659,000 francs.
The Paris association did a business of 196,165,000 francs in that year.
The development of the distributive cooperatives, of those affiliated
to the National Federation, and of the regional associations is shown
in table 14.
T a b l e 14.— Operations of Distributive Cooperatives in France, 1 9 1 3 -3 8
!For par values of currency, see Appendix table, p. 2781
Total associations
All associations affiliated to
National Federation
Regional (“ development” )
associations
Yea:
Num Members
ber
Business
F ra n cs
1913___
1918....
1922___
1928___
Num Members
ber
Business
F ra n cs
3,261 865,022 317,572,890
894 254,251 108,001,827
23,140 1,313,427 636.699,319 21,944 742,924 433,830,200
4,300 2,329,869 1,747, 223,293 1,937 1.338. 708 1,116,670,256
3.513 2. 285,221 3, 552,883,386 l. 459 1,444,044 2.373, 549,431
1930___ 3,296 2,288.838 3,831,186,712 0)
0)
C1)
1,120 1,659,956 3,800,966,363
1933___ 2,908 2.491.000
1936___ <2,875 2.671.000
0)
0)
0)
*1,000 2,500,000 3,500,000,000
1938___
0)
0)
1
i No data.
’ As of July 1919.
Data relate to 1934.
Num
ber Members
Num
ber
of
stores
Business
F ra n c s
(")
47
52
0)
(0
(0
504,559 2,317
423,980,792
677.374 1.181 l, 107.359,937
51
1,248,560,357
720,106 0)
40 *1,033,051 34,937 31,579,000,000
39 1,096,277 5,077 1.615.000. 000
38 l, 147,993 5,030 2.220.000. 000
< As of Jan. 1,1935.
•Approximate.
W elfare W ork
Concern for the welfare of the children has been a continuing char
acteristic of the consumers’ cooperative movement and, as noted,
cooperative associations were among the first to adopt the familyallowance system.
During the first World War period, refuges for orphan children were
established. The early efforts were scattered and were .generally
carried on by individual associations. In 1922 coordination was
effected in the Paris area through the formation of a special associa
tion, called “ L ’Enfance Cooperative.” Its special function was the
development of vacation colonies, homes, or camps. In 1927 the
association widened its membership to accept all National Federa
tion affiliates throughout France.
Its first activity was the opening of a sanitarium for the treatment
of children threatened with tuberculosis. Then followed a series of
vacation camps. By the end of 1932 it was operating 4 summer
camps as well as the year-round sanitarium. Altogether, the camps
had accommodations for 1,050 children and the sanitarium for 100.
The costs of operating these camps were met from a bond issue sub
scribed by the cooperative associations and their members, by sub
France
79
scriptions of affiliated associations, and by fees paid by the children's
parents (if they were able to pay). The accommodations have also
oeen used in recent years to shelter Spanish refugee children and
children evacuated from other areas of political and military conflict.
In 1938 the association had in membership 62 cooperative associations.
L'Enfance Cooperative and its sanitarium were approved as public
utilities by the Ministry of Public Health and their services were
increasingly utilized by the public health authorities, insurance com
panies, and others.
Another specialized association, H6tels Co-op, ran several hotels
for adults at the seashore and in the country. In spite of the de
pression they were reported in 1933 to be in a “ satisfactory" condition,
with a promising future. No later information is available for them.
At least three of the development associations carried on certain
welfare activities for the members or their children. The Union of
the Somme spent about 600,000 francs annually for the upkeep of its
holiday home which provided free vacations for some 1,600 young
people each year. Its estate of 50 hectares, with accommodations
for 500 children at a time, cost the association 4,000,000 francs for its
purchase and equipment. The Cooperative Union of Paris operated
a medical, surgical, and dental clinic, a mutual-benefit fund paying
sickness, death, and maternity benefits to members in proportion to
purchases at the association's stores, and five vacation homes for
members. The regional association at Limoges joined with the
municipal authorities in turning a prison just outside the city into a
holiday home with facilities for over 300 children. The association
later acquired a manor house which it used as a summer home but
was planning to convert into a sanitarium for preventive care against
tuberculosis. These three associations each year enabled from 6,000
to 7,000 children to spend their vacation under ideal conditions.
The consumers' cooperatives also established a National Committee
of Leisure to coordinate and promote the recreational and social
welfare work in the cooperative movement.
French Cooperative Wholesale Society
An early attempt at cooperative wholesaling, in 1886, failed. The
Cooperative Wholesale Society (Magasin de Oros, “ M. D. G ."),
created in 1906, was moderately successful almost from the first.
During its first decade, its business increased steadily year by year,
with the exception of 1914-15 when war conditions caused a 34percent decrease.
For the next few years its expansion was rapid. By the end of 1919
it had established its own banking department through which the
resources of cooperators were channeled into cooperative develop
ment, and it was operating three shoe factories. Its main business
was in groceries but it had a substantial trade in wines also.
In 1924, in the pinch of the post-war depression, some of the large
associations affiliated with the wholesale entered into a purchasing
contract with it. They bound themselves thereafter to make an
their purchases through the wholesale. This had the advantage,
especially in regard to the wholesale's productive activities, of ena
bling the M. D. G. to plan for a fairly known market. Several years
80
Cooperatives in Individual Countries
later it began the retailing of the products of its shoe factories, and by
1934 had 33 retail outlets. It also gradually expanded its production
until it operated 11 plants manufacturing chocolate, butter, soap,
salt, canned goods, and clothing. In 1930 the trade-mark “ Co-op”
was adopted and registered. Its use was restricted to goods manu
factured by the wholesale or those whose manufacture it controlled.
The shoe department proved to be one of the wholesale’s less uccessful ventures. It was the first to feel the effects of the depression
beginning in 1929, and during the next few years considerable losses
in the retail outlets were incurred. By 1936 the shoe factories’
financial position had improved and they were again operating “ in
the black,” but the retail outlets were still losing money.
The wholesale joined with the agricultural associations in the forma
tion of a cooperative for the marketing of farm produce. It also was
part owner in several private enterprises It owned about a fourth
of the stock of a company producing fats and oils used in the manu
facture of soap and other industrial products, and a controlling
interest in a wine company, a salt works, and a company engaged in
the processing of ground nuts.
The character of the M. D. G. had changed gradually over the
years. At first a wholesale organization, with branch warehouses in
various parts of France, after the growth of the large development
associations it turned these warehouses over to their management.
Thereafter, its functions were mainly those of joint purchasing agent
of the member associations, exporter, importer, and manufacturer.
The society had built up a substantial import and export business
with cooperatives in other countries (Russia, Switzerland, Belgium,
Great Britain, Italy, Poland, and Czechoslovakia), but the tariff
barriers and increasing restrictions on international trade during the
thirties decreased this business considerably.
The trend of development of the wholesale is shown in table 15.
T
able
15.— Operations oj French Cooperative Wholesale Society, 1 9 0 6 -7 to 1942
[For par values of currency, see Appendix table, p. 278]
Year
1906-4)7_________________________
1913-14..............................................
1916................................. . ................
1920...................................................
1923...................................................
1926...................................................
1929.................................................
1932_________________________
1935....................................................
1936....................................................
1937....................................................
1938....................................................
1939....................................................
1941....................................................
1942....................................................
iN o data.
8Data are for 1919-20.
Number
of member
associa
tions
Amount o.
business
F ra n c*
141
425
428
1,591
1.664
1,480
1,425
1,877.181
13,720,489
19.906.028
165,930,376
268,800, 543
457,071,448
711,679.961
1,238
1,330
1,235
0)
840
(9
891
827,000,000
761,597,181
863,104,260
1,066,021,394
1, 209,466,132
1,276,899,000
1,004,284,000
1,234,284,000
Share capital Net earnings Value of own
production
F ra n c.
47,025
119,625
131,650
3,889,825
9,315, 576
10. 701.450
0)
0)
15,852,075
17,872,075
23,063,375
23,680,000
24,147,900
0)
28,045,700
F ra n c s
(i)
43,415
<9
(9
1,030,000
1,621,244
(9
0)
(9
4,835,298
7,702,453
8,195,654
(9
(9
7,959, 729
F ra n c s
926,716
1,417,476
14,085,177
22,140.185
23,591,845
38,087.229
50,390,293
48,232,905
54, 287,610
62,441,343
65,582,590
81,200,085
(9
54,061,977
France
81
Cooperatives D uring the P re-W a r Decade
The French consumers’ cooperative movement, being primarily a
working-class movement, was peculiarly sensitive to declines in
employment with the resultant waning purchasing power. It there
fore was among the first to feel the results of the spreading business
stagnation in the thirties, although it held its own remarkably well
during the first few years of the depression.
Its troubles were soon accentuated by other difficulties. As the
depression deepened, the movement was the object of increasingattacks from the private merchants. Although this was no new
development (intermittent attacks had been leveled against it from
the same source since as early as 1893), the current attack was so
bitter that the International Cooperative Alliance termed it “ a
campaign of calumny.” Sweeping charges of complete tax exemption
of cooperatives were made by the merchants. To these the coopera
tives pointed out that they paid all the taxes levied upon business,
with the following exceptions: (1) Associations which dealt only with
members did not pay the profits tax, for they had no profits in the
accepted sense; (2) no tax was paid on patronage refunds; and (3) no
tax was paid on earnings spent for general welfare work.
As a result of the influence of the merchants, the French Parliament
in 1933 levied a special tax on turnover and canceled the previous
exemption on social-welfare expenditures.
Another complicating factor for the cooperatives was the difficulty
in which the Cooperative Bank found itself. This bank, which had
begun as a department of the wholesale, became an independent
organization in 1922. During the next 10 years the number of its
accounts rose from 37,000 to over 99,000 and its volume of business
from 1,480,000,000 to 27,704,000,000 francs. During the last 2
years of this period the development was especially rapid, owing
partly to the closing down of the savings departments of several large
associations whose members then transferred their accounts to the
central bank.
It suddenly suspended operations in 1933. Examination indicated
that its loans to cooperatives were sound, but its managing director
had without authorization made loans outside the movement and
even to private business. A large proportion of these latter trans
actions proved to be bad and involved the bank in such difficulties
that it was forced to close. The cooperative associations of the Na
tional Federation, however, guaranteed all the debts of the bank and
undertook to pay off all its obligations within a period of 15 years.
In 1935 a genera] reorganization, designed to strengthen and unify
cooperative effort, was voted by the congress of the National Federa
tion. A general auditing union, the General Society of Control of
French Cooperative Societies, was formed. It was given authority
to supervise the financial and commercial activities of all the develop
ment associations, those having purchasing contracts with the whole
sale, and those having savings departments. A national committee
of 50, appointed by the regional federations in proportion to their
importance, was created. It was to administer the Control Asso
ciation. An administrative council of 18 members was appointed to
coordinate the activities of the federation and wholesale, superseding
the former administrative council.
82
Cooperatives in Individual Countries
It was provided that thereafter the wholesale would accept into
membership only cooperatives affiliated with the National Federa
tion. Federation members that were not members of the wholesale
must join it before the end of 1939.
The functions of the defunct Cooperative Bank were taken over
by a federal association that had been formed in 1932 by the large
associations under the name, National Society for Development and
Solidarity. Its activities were mainly those of auditing, though it
had some credit functions. It was selected to carry out the liquidation
of the bank, and in July 1934 changed its title to Central Society
of the French Cooperative Societies. In the reorganization of 1935
its bylaws were changed and it assumed some of the credit activities
of the former bank, though under strict limitations. Its operations
were to be confined to cooperative associations only.
The year 1936 was marked by sudden rises in prices, sit-down
strikes, and other evidences of unrest, and devaluation of the currency.
Also the private merchants were still active in seeking Government
protection and action. These merchants, who accounted for about
65 percent of the total private trade of France even then, were
trying to obtain the passage of a law forbidding the opening of new
chain or “ multiple” stores—a measure which would have prevented
the further expansion of cooperative associations operating branches.
This measure was opposed by the cooperative movement and failed
to pass. It was observed at the time that the large cooperative
associations were “ better equipped technically than the most
advanced types of private store, and the cooperative movement as
an instrument of economic progress * * * greatly embarrasses the
old-fashioned forms of private trade.”
During this period collaboration between the consumers’ coopera
tives and the agricultural cooperative movement was developing
in a most encouraging manner and several joint associations were
formed under the terms of a special law authorizing such associations.
At the cooperative congress of 1936 the proposal was made that
the National Federation should become a member of the Popular
Front. This was overwhelmingly rejected by the congress, which
reaffirmed its independence of an political parties.
The year 1937, also, was characterized by a feeling of insecurity
which prevented the country’ s sharing in the general recovery of
world trade in that year. Nevertheless the consumers’ cooperative
movement not only maintained its position but even achieved some
advance. The cooperators were finally successful in obtaining the
passage of a law which they had been advocating for many years,
limiting the use of the word “ cooperative” to organizations which
met specified cooperative standards.
After the franc was devalued to about three-fourths of its former
rate, industry recovered somewhat in 1938, although hindered by
the unfavorable world situation. The cooperative wholesale reduced
its prices to the lowest level possible, thereby reducing its net earnings.
Notwithstanding this action it was able from the surplus of that year
to pay 4,841,912 francs toward the liquidation of the Cooperative
Bank’s liabilities, and to return 251,455 francs in patronage refunds
to its member associations.
In 1938 the Government issued a decree establishing the Central
Cooperative Credit Bank and transferring to it from the Ministry
France
83
of Labor the duty of administering the State funds available for
loans to consumers7cooperatives and workers7productive associations.
The bank was constituted as a federation of cooperative associations,
and given the privilege of making loans for periods as long as 15
years, as well as short-term loans (as formerly). By a later decree
the informal purchasing groups that had sprung up among public
employees, as well as among workers in factories and other industrial
establishments, especially after 1934, were required (in order to
continue operation) to become consumers7 cooperative associations.
The consumers7 cooperatives immediately approached these groups
with a view of inducing them to join existing cooperatives or, failing
that, of assisting them in establishing new associations.
A Government committee, composed of representatives of co
operatives and of the various Ministries, was established in the same
year to study the cooperative movement and devise means of
establishing a permanent link among the credit, consumers7, agri
cultural, and workers7 productive associations.
The 17 regional federations, which were the members of the National
Federation and which in the reorganization of 1935 had been reduced
to 13, were joined in 1939 by a new national group— “ F6d6cop6rail,”
federation of the cooperative associations run by railway workers.
In 1937 this organization had in membership 150 associations with
100,000 members.
Effect o f the W ar on Cooperatives
During the years 1935-38 the consumers7 cooperative movement
gradually attamed recognition in the system of planned economy
that was slowly being put into force in France. The cooperative
movement was recognized, under the Meat Marketing Act, as the
representative of consumers, and was also given representation on
a number of public bodies.
Beginning in 1939 the cooperatives began to suffer increasingly
from the wartime economic regulations and difficulty of obtaining
supplies because of the scarcity of certain essential commodities.
Nevertheless, the movement was holding its own and even increasing
its productive output.
Even as late as the beginning of May 1940, the managing director
of the Cooperative Wholesale Society told the annual meeting of
delegates that the wholesaled business since the beginning of the
year had been increasing at the rate of about 20 percent over 1939,
partly as a result of rising prices and partly as a result of intensive
cooperative efforts. He stated that he “ faced the future with great
confidence77 for the development of the cooperative movement.
Less than a month later, the German armies had cut off from the
rest of the country the whole northern (industrial) section of France,
which contained all of the large development associations and ninetenths of the entire cooperative movement. Some associations had
their premises destroyed by bombardment. The wholesale associa
tion lost its footwear factories at Amiens and Lillers.
A policy of “ regroupment, unification, and purification of the co
operative movement77 was immediately started by the Germans. The
National Federation and tbe Cooperative Wholesale Society were
merged into one organization, all associations in a single town or city
84
Cooperatives in Individual Countries
were required to consolidate, and some of the veteran cooperative
leaders were “ permitted to retire.” In Alsace-Lorraine all of the
cooperatives were incorporated into the German Labor Front and
lost their identity.
In unoccupied France, cooperatives like other organizations were
subjected to the measures inaugurated by the Vichy Government with
a view to reorganizing French economic life along corporative lines.
The law of December 2, 1940, reorganizing agriculture, was described
as “ a compromise between the old organization inherited from republi
can France and the new conceptions of autocratic government.”
Somewhat later a National Committee of Commerce was created on
which the consum ed cooperatives were represented as one of the four
forms of distribution, the others being the chain stores, wholesalers,
and other retailers.
Evidently the associations in occupied France, as well as Vichy
France, were allowed to continue operations. In June 1943 a coop
erative congress was held in Paris that brought together, for the first
time since the invasion, delegates from cooperatives throughout France
(except Alsace-Lorraine). The reports there submitted indicated
that business had improved, after an initial fall, but production had
declined (see table 15), and that under the circumstances “ the situa
tion of the cooperative movement is generally satisfactory.”
W orkers’ Productive Associations
France has the distinction of being the birthplace of workers’ produc
tive associations 19 and is one of the few countries in which this form
of cooperation has attained any great development. Certain students
of the workers’ productives in France 20 attribute their development
to the tardy rise of large-scale industrial enterpr ses and the fact that
France has remained to a great extent a land of small enterprisers
among whom the workers’ productives with small capital resources
could hold their own. Of no little importance also was the encourage
ment by the successive French governments, in the form of loans and
of contracts for business.
The first association was formed in 1831 but did not even get into
operation. Between 1848 and 1852 nearly 200 associations were
formed, but disappeared during the period of the Empire. In 1865,
a few again were started with varying degrees of success.
T H E N A TIO N AL P R O D U C TIV E FE D ERATION
In 1884 the workers’ productives, in an attempt to strengthen their
movement, which was at rather low ebb, formed a central body, the
Chambre Consultative des Associations Ouvridres de Production.
Of the 51 associations then in existence, only 22 (mostly in Paris)
joined it. However, it was favored by legislation of 1888, under which
the public authorities were empowered to give preference to workers’
19The workers' productive associations of France are oi two kinds—those which own their own businesses
with plant, equipment, etc., and those which make collective contracts to carry on certain types of work
in establishments owned by others. This latter type of association, called the “ commandite, is found in
a number of industries, especially the printing industry No statistical data are available for the commandites the tables here given all relate to the workshop-owning associations. (For a description of the
methods of operation of the commandites, see Monthly Labor Review. February 1926, pp 208-211 and
August 1929, pp 115. 116.)
20 Jean Qaumont (Histoire G6n£rale de la Cooperation en France) and David Japoss (Labor Movement
in Post-War France).
France
85
productives over private contractors, on Government contracts. Five
years later it started its own bank and again was aided by Government
encouragement and a deposit of 150,000 francs. In 1904 it established
an orphanage for children of deceased cooperators and auxiliary
workers. In 1907 it founded a legal bureau and a department o ac
countancy; also a benefit association to prov de death, old-age, and
unemployment benefits. Family allowances were also inaugurated
by the Chambre in 1923, and in 1927 it opened a home for aged mem
bers. The Chambre’s family allowance fund was reorganized after
the establishment of a general system of family allowances in France
in 1934; and membership was opened to consumers’ cooperative
associations as well as to workers’ productives.
In 1930 the Chambre had in affiliation 340 associations with 23,000
members. By 1937 the number of affiliates had risen to 475 and their
combined membership to 31,227. Their business in that year
amounted to 372,768,000 francs. The affiliates of the federation
represented 73.3 percent of the total workers’ productive associations
and 41.9 percent of the total reported business.
The annual congress of 1937 changed the name of the Chambre
Consultative to one more descriptive of the actual situation— Con
federation Generate des Co6p6ratives Ouvri&res de Production de
France et des Colonies. A report rendered at this meeting stated
that in 1937 the orphanage was sheltering 178 children— 7 more than
in the preceding year. Its two vacation homes were still in ‘ ‘satis
factory” operation. The secretary-treasurer of the central organiza
tion also stated: “ W e think that the difficult period that our associa
tions have just gone through is at an end and the next periods will be
better.”
SITUATION P R IO R TO W A R
The workers’ productive associations, being so largely dependent
upon the Government for both credit and contracts, were strongly
affected by the changes in public policy resulting from the rapid
changes in the political complexion of the Government.
Certain advantages in taxation enjoyed since 1927 were withdrawn
in 1934 and the associations became liable to taxes on turnover as
well as on industrial and commercial profits (except sums used for
welfare purposes).
In 1935 a decree was issued, in the drafting of which the Chambre
participated, defining standards for genuinely cooperative “ workers’
productive associations” and making illegal any false use of the term.
A decree of 1931 had provided for certain preferences to workers’
productives in connection with public works, and up to 1936 State
credit was available. This credit was withdrawn in 1936 and 1937
but was reintroduced in 1938. In 1939, out of a special appropria
tion of a billion francs for public works (adopted as a measure to
cushion the effects of war dislocations), 50 million francs were ear
marked for contracts for workers’ productive associations.
Of 648 associations in existence at the end of 1937, 4 were in agri
culture, 8 were in extractive industries (quarrying, etc.), 6 in food
manufacture, 71 in the printing trade, 5 in textile industries, 21 in the
clothing industries, 103 in woodworking industries, 22 were making
leather products (shoes, gloves, etc.), 51 were in metallurgical trades,
39 in the stone, clay, and glass industries, 271 in construction or public
86
Cooperatives in Individual Countries
works, 25 in transportation, and 22 in other trades (chemicals, paper,
jewelry, liberal professions, etc.). In addition to their members, these
associations employed 7,305 “ auxiliary” workers.
The associations were situated mainly in the Department of the
Seine (including the metropolitan district of Paris)— with over a
third of all the associations— and in the highly industrial districts,
such as the Department of Nord, and the cities of Marseilles, Lyons,
Toulouse, Limoges, and Rennes.
T
able
16.— M em bership and Operations oj W orkers9Productive Associations in France,
1893-1938
iFor par values o1currency, see Appendix table, p. 278
Membership
'T
XV
Okfal
taJ
number of Number of
associa
associa
tion?
Members
tions
reporting
Year
Amount of business
Number of
associa
tions
reporting
Amount
F ra n c*
18(13____ . . .
_________
ifinn______________________________
1007____________________________ _ _____
1010________________________
1013___________________________ _______
1020____________________________________
80
294
358
498
476
529
1023_____ ___________
1030_________________________
1033_________________________________ _
1030__________________ ________________
1 0 3 7 . _ _
_ _
531
584
506
642
648
(*)
155
331
485
466
463
(»)
10,793
15,838
19,520
19,097
19,973
424
356
434
418
462
21,322
17,108
19,086
21,419
16,530
0)
445
379
(i)
0)
60,358,700
0
)
71,309,000
199,524,800
c42
323
847
884
450
155,026,200
386,772,000
377,783,491
329,000,666
890,068, 251
297
Confederation Gen6rale
1884. _
1802
_
_
. ...
'1007 _. ________ ______________________
1021
1030 .
. . . . _____________ _________
1037___ _ _________________________
1038
________________________________
22
40
200
345
340
475
478
(i)
(i)
(i)
(i)
(!)
375
340
475
478
20,000
23,000
31,227
32,872
a
340
475
478
8
8
210,000,000
372.768.000
596.400.000
JNo data.
A report of the administrative council of the Confederation in May
1940 (just before France was invaded), summarized in the organiza
tion’s official journal, L’ Association Ouvrifere, listed the names of 102
associations that had gone out o f existence since the outbreak of hos
tilities. No information regarding the workers’ productive associa
tions has been received since the invasion.
LA FAMIL1ST&RE AT GUISE
Perhaps the most famous of all the French workers’ productive asso
ciations was that known as La Familist&re, at Guise. This organiza
tion was founded in 1879 by M. Godin, and engaged in the production
of stoves. Its workers were divided into four classes according to their
length of service and stage of initiation: At first they were merely
employees with a right to a pension and insurance against sickness
and accident; next they received a share in the earnings, to the extent
of one share each year; the next step increased their snare in the earn
ings 50 percent over what they had received in the second class; and
Netherlands
87
finally they became full members. The profit sharing was paid in
stock, not in cash, and upon the withdrawal of a member, his stock
had to be sold back to the association.
Before the first World War this association, with its six foundries,
was the most important metal-casting works in Europe.
The association sustained heavy losses during the war. The city of
Guise was practically destroyed and the Familist&re suffered not only
from the bombardment but by having most of its plant and machinery
either ruined or carried off by the Germans. It started operation
again in August 1919.
The association was able to weather all the vicissitudes of the next
decade and in 1931 was described as “ among the most flourishing” of
the French workers' productive associations. Its plants and workers'
houses together formed a garden city For the 2,500 worker-owners
the association had provided sickness and old-age insurance and vari
ous kinds of social-welfare measures. From a turnover of 7,921,618
francs in 1919-20, when it was revived, its business expanded to 48,844,530 francs in 1924-25 and 72,412,738 francs in 1929-30. It was
still in successful operation, in 1937, when the workers' productives
were commemorating the centenary of the death of Fourier whose
teachings had inspired the founding of La FamilistSre, but no data are
available as to its fate under German occupation.21
Cooperative Movement in the Netherlands
In many of the central and southeastern countries of Europe, the
cooperative movement developed in an atmosphere of turbulence.
Cooperators had to contend with a succession of wars with their re
sultant destruction of life and property and shifting of territory and
population, with recurring depressions, and with periodic political and
economic upheavals. In the Netherlands, on the contrary, when the
country was invaded by the Germans in May 1940, there had been a
hundred years of peace under the constitutional rule of a single royal
family.
The country, depending on its overseas trade, had of course felt
severely the post-war depression of the early twenties and the wide
spread unemployment and trade stagnation during the depression
beginning in 1930. Its international trade was drastically curtailed
by the restrictions on imports and exports imposed by the countries
with which it traded ana by their early abandonment of the gold
standard, to which the Netherlands continued to adhere until 1936.
;1S o u rces.— T h e report on France is based upon data from the following publications: Bulletin du Mini
ster du Travail (Paris), issues of April-May-June 1922, January-February-March 1924, October-NovemberDecember 1924, April-May-June 1932, July-August-September 1935, July August-September 1937, and
October-November-December 1938; L’lnformation Sociale (Paris), October 15, 1931: Annuaire Statistique
de la France, 1938; L’ Association Ouvriere (Paris), issues of M ay 5, August 25, and November 25.1937,and
May 10, 1940; Annuaire de la Cooperation (Federation Nationale des Cooperatives de Consommation de
France). 1920 and 1926-27; International Cooperative Bulletin (International Cooperative Alliance, London)
issues of May 1917, January. May, September, and December 1918, January, September. November, and
December 1919, February,April-May.June, August,September,and October-November 1920, February and
June 1921, February. April, and May, 1925, September and December 1927, and May and December 1928;
Review of International Cooperation (International Cooperative Alliance. London), issues of October 1919,
October 1921. February, April, June, and November 1933, June and November 1934, April and July 1935.
March, April, and July 1936, April and May 1937, February, May. September, and October 1938, June ana
October 1939, January, February, and November-December 1940, March. April.and September 1941, Feb
ruary 1943. and June 1944; Peoples Yearbook (English Cooperative Wholesale Society. Manchester) 1937,
1939 1940. and 1941; International Directory of Cooperative Organisations (International Labor Office,
Montreal), 1939; Cooperative Information (International Labor Office, Montreal), No. 2, 1935 and No. 3.
1939: Labor Movement in Post-War France, by David J Saposs (New York Columbia University Press.
1931) and Consular reports of April 13,1921 and April 12,1938.
88
Cooperatives in Individual Countries
Nevertheless, until the late thirties the Dutch had the advantages
of a free, democratic country in which the standard of living was high,
conditions generally good, and illiteracy almost nonexistent.
One of the most highly educated peoples in the world, the Dutch
were inherently conservative and consequently rather slow to take
up cooperative activities. Although the first cooperative (a farmers’
association) was formed as early as 1837, the general law authorizing
cooperatives was not passed until 1876, and then largely as a result
of the efforts of a single enthusiast who, with a small group of adher
ents, was successful in getting the measure through Parliament. The
development of cooperatives took place very gradually, especially in
the field of consumers’ cooperatives, being retarded at first largely by
public Imowledge of the financial losses sustained by the members of
a few of the early associations. The rate of progress was also slowed
by religious and political differences which (as in the Dutch tradeunion movement) kept apart, in small separate groups, cooperators
who might otherwise have been banded into strong, stable organiza
tions. Thus, the Catholics, who had their own political party and
trade-unions, also formed separate cooperative associations admitting
only those professing that faith. There were several Protestant
political parties, and a Christian (Protestant) labor-union group, as
well as Protestant cooperatives. During and preceding the first
World War there was also a group of cooperatives connected with
the Social-Democratic Party, but they later merged with the con
sumers’ cooperatives that were neutral as regards both politics and
religion.
Although cooperative growth was slow, it was practically con
tinuous and by the middle thirties the Dutch farmers had through
their cooperatives achieved a success rivaled only by that of the agri
cultural cooperatives of Denmark. In 1938 cooperative dairies
handled 76.7 percent of the total milk production and made 82.0 per
cent of the butter and 76.5 percent of the cheese. In the same year
34.0 percent of the egg output was sold through the cooperative egg
marketing associations; 90 percent of the potato flour produced in
the Netherlands and 60 percent of the beet sugar were made by co
operatives. Through cooperative insurance associations, the farmers
insured their houses and farm buildings against fire, their cattle
against loss, and their crops against hail. Their output of fruit,
flowers, and vegetables was sold through special auctioneering asso
ciations; and their grain was threshed by machines from the coopera
tive threshing associations. Each of the various types of associations
had its own central organization.
The consumers’ cooperatives were found mainly in the cities, among
the industrial workers, and although their penetration in their special
field was not so great nor so spectacular as in the case of the farmers’
associations, they were serving about 15 percent of the entire popula
tion (the percentage was considerably higher on the basis of the cities
alone) and accounted for about 6 percent of the retail grocery business
in the Netherlands.
This growth was achieved entirely on the basis of self-help. In
the Netherlands there was neither the Government favor (low-rate
loans, preferential contracts, etc.) found in some of the other countries
nor Government attempts to control the administration of coopera
tives. In isolated instances it appeared that certain measures
89
Netherlands
discriminated against the cooperative movement but usually the
movement was able eventually to obtain representation and have the
situation remedied. Under the system of controlled capitalism and
general regimentation that had gradually resulted from Government
measures designed to aid recovery in the difficult decade preceding
the outbreak of the present war, the cooperatives— especially the
central associations whose operations entered into international
trade—lost some of their freedom of commercial action as did all other
businesses.
Aside from losses of life and property, the greatest immediate effect
of the German invasion of the Netherlands upon the cooperatives was
the drastic reduction of business. Although no direct word has been
received since late in 1942, it appears that the movement has been
allowed to continue but with pyramided taxation and with a new
system of central control over the agricultural cooperatives. The
framework should therefore be intact for post-war expansion.
T ypes o f Local Cooperatives
In table 17 is shown the development (as indicated by number of
associations) of the various types of cooperatives, from 1910 through
1936. Such figures are not very satisfactory as an indication of
growth, for a contraction in number may really be an indication of
strengthened operation. This has been the case in the consumers7
cooperative movement where small associations have merged to form
stronger ones, and the combined membership has shown an almost
uninterrupted increase. Unfortunately, the Netherlands has pub
lished no figures showing membership and business of all the types of
cooperatives.
T
17.— N um ber o f Cooperative Associations in the Netherlands in Specified Years,
able
by T yp e
T y p e o f association
All t y p e s
_ _
_ _
_
___
__
_.
C o n s u m e r s ’ d is t r ib u t iv e a s s o c ia t io n s .
H ou sin g associations__________________________
I n s u r a n c e a s s o c ia tio n s ___ _ __.
C redit associations:
A g ric u ltu ra l
. _
_
__ _ _ ___
O th er.................................................. ....... ...........
P urchase, sale, and p rod u ctiv e associations:
A gricu ltu ral- . . ................................................ ..
W ork ers’ p ro d u c tiv e ______________________
O th e r in d u s t r ia l..
_. .
C om m ercia l_______________________________
O th e r................................ .....................................
M is c e lla n e o u s -
_
_
1910
1914
1923
1926
1929
1933
2,320
2,894
3,032
3,088
3,131
3,210
3,252
223
201
42
240
269
47
413
178
84
489
153
56
429
143
57
413
145
65
424
138
73
536
715
834
786
107
807
97
807
79
808
71
1,163
0)
0)
0)
0)
155
1,362
0)
0)
1,153
0)
2 94
1,196
27
107
113
25
29
1,327
26
92
88
36
29
1,418
21
76
103
39
44
1,435
17
76
103
46
61
8261
0)
0)
276
1936
1N o data; m a y be in clu d ed in m iscellaneous.
; “ M id d le-class” associations.
CREDIT ASSOCIATIONS
Most of the credit cooperatives in the Netherlands are those of the
farmers, and these agricultural credit cooperatives in turn are mostly
of the Raiffeisen type which also do purchasing of farm supplies and
processing and marketing of farm produce.
No data are available for the whole group of credit associations.
The magnitude of the Raiffeisen associations7 operations is shown in
588544°— 44------7
90
Cooperatives in Individual Countries
table 18. The paralyzing effect of the great depression is shown in the
reduction of their loan business from nearly 58 million florins in
1929 to about 19 million in 1934 (the latest year for which data are
available). The Raiffeisen associations have their own federation to
which 729 associations, with 158,718 members, were affiliated in 1936.
T a b l e 18.— M em bership and Operations o f Raiffeisen Credit Associations in the N ether
lands, 191 2 -3 4
[F o r p ar values o f cu rrency, see A p p e n d ix table, p . 278]
Y ea r
N um ber
o f asso
ciations
N um ber of
m em bers
(“ ac
cou nts” )
L oans m ade
in year
836
928
1,115
1,228
1,247
1,283
1,294
1,296
1,295
99,152
126,630
216,573
306,650
368,756
472,531
511,322
509,815
524,142
12,725,000
12,022,000
28,268,000
49,216,000
48,041,000
57,933,000
46,972,000
18,896,000
18,803,000
F lo r in s
1912........................................
1914........................................
1918........................................
1921........................................
1926........................................
1929.......................................
1931........................................
1933.......................................
1934.....................................
consum ers’
L oans o u t
standing
e n d o f year
F lo r in s
25,145,000
33,127,000
53,000,000
119,087,000
160,316,000
209,114,000
227,675,000
215,092,000
206,220,000
D e p osits
N et
earnings
F lo r in s
F lo r in s
33,779,000
34,954,000
135,728,000
191,508,000
198,056,000
240,791,000
217,561,000
153,118,000
174,024,000
179,000
258,000
435,000
1,286,000
1,803,000
1,908,000
2,253,000
2,026,000
1,932,000
c o o p e r a t iv e s
The consumers’ cooperatives of the Netherlands have consisted
mainly of bakeries, fuel associations, kitchens doing central cooking
of meals for urban dwellers, and store associations selling groceries and
provisions and household supplies.
Figures are not available for recent years, showing the various
types of consumers’ cooperatives. In 1917, of 552 distributive co
operatives, 343 were cooperative stores, 142 were cooperative bakeries,
10 were cooperative butcheries, and 57 were cooperative fuel associa
tions. As is evident from these figures, the bakeries in the Nether
lands, as in Belgium, have formed an important part of the distributive
cooperative movement. However, unlike the situation in Belgium,
where the sale of bakery goods has been decreasing in relation to that
of groceries, the Catholic federation reported that among its associa
tions bakery sales were outstripping those of groceries.
Cooperative housing associations,— Cooperative housing associations
have been found in the Netherlands since early in the twentieth cen
tury. These associations erected their own buildings and generally
retained title to them, the members occupying the dwellings on a rental
basis.
The expansion of these associations was halted during the first
World War by scarcities of materials and by the high cost of labor and
land, and their number decreased from 282 in 1915 to 178 in 1923.
Part of the decrease was attributed also to the policy of the local and
national governments of subsidizing private builders, so that the need
for cooperative effort was not so great. For 1936 only 138 of these
associations were reported.
Welfare, health, etc,—Although the Dutch cooperatives did not
undertake welfare work extensively, as the Belgian associations did,
a few organizations have been outstanding in this respect. One of the
oldest cooperatives in the Netherlands, “ De Volharding” (“ Persever
ance” ) at the Hague, about 1890, established a sick-benefit depart
91
Netherlands
ment and later a medical-care department. Although opposed by the
medical profession and for several years boycotted by the hospitals,
this association was very successful. By 1923 its medical department
had a membership of 50,000 and a staff of 30 doctors in addition to
nurses and pharmacists. In 1939 it established its own hospital. By
1940 the membership of the sick fund had grown to 82,000. The
association had 21,000 members in the store department, making it
the second largest consumers’ distributive cooperative in the country.
Early in 1940 the national wholesale association “ De Handelskamer”
helped to start a new association, “ Copharma,” to act as wholesale
purchaser of supplies for the pharmacies of the sick-benefit societies,
many of which were operated in connection with consumers’ coopera
tives. The International Cooperative Alliance stated that the sick
funds (with about 4,000,000 members) had needed the wholesale as
a protection against the boycotts of the medical profession and the
monopoly prices of the highly cartelized drug industry.
Development o f Consum ers' Cooperative M ovem ent
C EN TRAL EDU CATION AL ORGAN IZATIONS
The first educational federation, the Dutch Cooperative Union, was
started as a department of “ Eigen Hulp,” an association of public
employees, but became an independent association in 1890. It was
politically neutral. Because one of its bylaw provisions specifically
excluded from membership “ workingmen’s cooperatives,” the associa
tions of the latter class therefore formed their own federation—
the Union of Workingmen’s Cooperatives— in 1907; it was SocialDemocratic in affiliation. This latter federation in its early years
required its member associations to turn over some of their earnings
to the Party and to the trade-union movement.
In 1920 the neutral Dutch Cooperative Union and the Union of
Dutch Workingmen’s Cooperatives merged, forming the Central Union
of Dutch Distributive Cooperatives (Centrale Bond van Nederlandsche
Verbruikscodperaties). Political and religious neutrality was one of the
principles of the new organization.
A number of the retail associations refused to join the new federa
tion; these included the two largest associations in the Netherlands.
The accompanying statement shows such data as are available for
the two federations that amalgamated to form the Central Union of
Dutch Distributive Cooperatives:
Social-Democratic federation:
associations
m em bers
19
43
1 0 ,3 8 5
38, 754
1900___________________________
32
97
1910 __________________________________________________________
1911 ___
122
19 15______
151
1920____________________________________________________________ 150
3 2 ,5 7 4
65, 035
8 7 ,0 5 7
9 9 ,7 8 3
1 6 1,09 6
1908___________________________________________________
1918____________________________________________
Dutch Cooperative Union:
Central Union of Dutch Distributive Cooperatives:
1 9 22 .
1924
1925
1926
__________________________________________
______________________________________________ ___________
________
........
141
137
132
135
1 3 7,26 4
127, 150
121,241
1 7 8 ,7 0 4
The Central Cooperative Union has been active in the formation of
various auxiliary enterprises, including the Cooperative Savings Bank,
92
Cooperatives in Individual Countries
the General Pension System for Cooperative Employees, and the
G. J. D. C. Goedhart Foundation, which is the center of educational
work in the consumers’ cooperative movement.
Catholic federation,— In 1912 the Catholic trade-unions had taken
the lead in the formation of a Catholic federation of cooperatives.
This federation admitted to affiliation only local associations whose
membership was restricted to Roman Catholics, and one of its require
ments was that a portion of the local associations’ earnings be devoted
to assisting Catholic benevolent institutions.
The following statement shows the development of the federation
from 1915 through 1926:
N u m b er o f
associations
1 9 1 8 ......................
1920__________
1922___________________________
1 9 2 5 ........................................................
1926_______________________________________
192
238
Their
m em bers
2 5 ,7 0 5
3 0 ,0 0 0
96
81
85 18, 549
24, 385
J8, 257
As the above figures indicate, the Catholic associations were small,
averaging less than 250 members per association in any of these
years. There w^ere, however, several large associations. The largest
one, “ Ons Dagelijks Brood” (“ Our Daily Bread” ), had by 1936
attained a membership of 6,122.
Joint action.— Although federated along religious and political
lines, the various branches of the cooperative movement had amicable
relations and occasionally joined forces for particular ends.
In 1917 the neutral, Catholic, and Social-Democratic federations
formed a central cooperative committee to defend the interests of
the cooperatives and to obtain representation on the various public
regulatory bodies. That committee remained in existence during
the first World War and for several years afterward; a similar body
w as formed again in 1934.
In the endeavor to extend and strengthen the consumers’ coopera
tive movement in the rural areas and small towns, in 1931 the Central
Cooperative Union and the wholesale formed the Cooperative Society
for Financing and Control (“ Cofib6” ). The purpose of this organiza
tion was to give technical aid to, and even finance, local associations
that got into difficulties. A few years later another association,
“ Fibeco,” was formed by joint action of two cooperative federations
(De Handelskamer and the Catholic cooperative federation) and the
Catholic trade-unions, for the purpose of financing new associations.
LOCAL COOPERATIVES
Consumers’ cooperation was of especially slow development in the
Netherlands. A cooperative official, explaining the slow pace of
cooperative growth commented as follows:
The Dutch distrust innovation, and are always slow to recognize the necessity
of a new line of action; but when once undertaken the work will be carried through,
because for perseverance our nation cannot be easily surpassed.
* *
*
Even the name, “ Cooperation,” being a word of a foreign tongue, seemed to
make the Dutch afraid. So in the beginning there were failures and many a
workingmen's society lost money and credit instead of giving golden fruits. It
took some time before the more successful societies of civil servants and
military officers made a better impression on the workingmen.238
8 Q . J. D . C . G oedh art, in International C oop era tive B ulletin (L o n d o n ), D ecem b er 1924, p . 363.
Netherlands
93
"When the first World War broke out, although Holland was not
invaded it was immediately and deeply affected. The consumers’
cooperatives went through a period of vicissitude from which, how
ever, they emerged with an increased membership and a stronger
organization. The cooperatives were finally able to obtain represen
tation on Government wartime bodies to regulate prices, distribution,
imports and exports, etc. Under a regulation adopted after the end
of the war, the associations were required to contribute to the funds
of the chambers of commerce composed of private retail dealers.
The war had taught the cooperatives the necessity of building up
their working capital instead of paying all of the earnings out in patron
age refunds. Generally, also, the associations in this period began to
create reserves for the payment of pensions to employees and benefits
of various kinds (sick, death, maternity, etc.) to the members.
The division along religious and political lines had resulted in many
small associations. In Amsterdam alone there were 9 separate retail
cooperatives. In the post-war depression when the cooperatives
reflected the unemployment and low purchasing power of their mem
bers, many associations failed and others were in financial difficulties.
It was in this period that the federations began to urge the merger of
small associations into larger organizations.
As the depression continued, the Government imposed greater
measures of control of industry, as well as export and import quotas.
Heavier taxation for purposes of relief followed.
It was reported that many of the unemployed who had some capital
opened small retail businesses. This naturally worsened the condi
tion of the other small merchants who, however, directed their dis
pleasure toward the cooperatives and urged the Government to forbid
the opening of new cooperative stores. That the independent mer
chants were still doing 81 percent of the total retail grocery trade
was indicated by the results of an official survey, made in 1929; the
cooperatives accounted for about 6 percent.
In order to protect the interests of the cooperative movement as a
whole, the National Cooperative Council was formed in 1934. Its
charter members were the cooperative wholesale, the Central Union,
the Catholic Federation, the dairy federation, the LandbouwComit£ (largest wholesale association of the agricultural supply co
operatives), and several other central agricultural organizations—
representing altogether over 1,300 local associations.
,Another departure was the formation of an organization by the
consumers’ and the agricultural branches of the movement, to operate
a chain of green-grocery stores throughout the Netherlands.
The Netherlands held to the gold standard for some time after other
countries had departed from it. This made competition by its in
dustries on the international market difficult, and the domestic
market also was stagnant. The country went off the gold standard
in September 1936, and the currency was depreciated by 20 percent.
Although this made some improvement, the number of unemployed
remained large and purchasing power low, and 1936 was still a year of
depression.
A temporary recovery took place during the first half of 1937 but
fell off in the latter half. In the attempt to accelerate the progress
of the cooperative movement, the various central organizations of the
consumers’ cooperative movement embarked upon a 5-year plan of
94
Cooperatives in Individual Countries
publicity and education. In that year, over the opposition of the
cooperative movement, a law was enacted giving the Minister of
Trade and Industry authority over the opening of new businesses.
Under the law, organizers of new enterprises were required to furnish
“ satisfactory evidence of the business knowledge, professional skill,
and credit worthiness” of those who were to run them. The bill, as
first introduced, provided that examination of these qualifications
should be in the hands of the local chambers of commerce. The co
operatives, however, were successful in having it amended so as to
give special committees this function and to allow the cooperatives
representation on these committees.
Table 19 gives such data as are available from various sources,
showing the extent of consumers’ distributive cooperation in the
Netherlands up to the outbreak of the present war, and the relative
importance, in the total, of the associations federated in the various
central organizations.
T a b l e 19.— M em bership and Business o f Distributive Cooperatives in the Netherlands,
1925-39
[For par values of currency, see Appendix table, p. 278]
D is trib u tive cooperatives—
all t y p e s »
A ssociations affiliated to—
C entral U nion
C ath olic F ederation
Year
N um
ber
536
496
415
425
408
409
/ 3 406
1935.............
\ 4 357
/ 3 419
1936..............
\ 4 357
1037
* 348
1038
4 351
1925.............
urn
1020
1930.............
1932.............
1934.............
1939..............
4 351
T h e ir
m em
bers
(*)
(2)
279,242
289,251
309,371
315.356
320,907
303,085
325,368
301,973
297,445
298,887
304,804
T h e ir
business
N um
ber
T h eir
m em
bers
132
135
130
131
<2)
141
121,241
178,704
185,395
189,970
(3)
216,125
F lo rin s
(2)
(2)
(2)
(2)
T h eir
business
N um
ber
T h e ir
m em
bers
Florin s
(2)
66,551,162
64,775,816
) 139
64.010.000
63,735,779
138
62.770.000
136
66.569.000
131
68.213.000
70,769,000
(2)
|
T h e ir
business
(2)
(2)
81
85
(2)
(2)
105
118
(2)
34,262
38,526
Flo rin s
7,170,000
(2)
( 2)
11,771,000
(2)
(2)
219,787
(2)
119
38,864
11,002,000
218,656
42,008,023
121
38,501
10,971,000
216,025
41,062,100
119
120
39,028
39,863
11,889,806
12,445,547
(2)
216,062
(2)
(2)
44,982,400
(2)
(2)
8
(2)
18,257
18,549
(2)
(2)
P rotes
tant
F edera
tion :
N um
b er o f
associa
tions
(2)
(2)
(2)
W
7
11
10
(2>
* 11
8
i Includes bakeries, cooperative kitchens, etc.
8 No data.
8 Including fuel associations.
* N o t including fuel associations.
* With 3,794 members and a business in 1937 amounting to 936,000 florins.
D E V ELO PM EN T OF TH E COOPERATIVE W H O LE SA LE
The cooperative wholesale was started in 1882 as a purchasing
agency for the various branches of the “ Eigen Hulp” association and
later became the wholesale department of the Dutch Cooperative
Union. During the latter period, associations desiring the wholesale
service had to join the union and endorse formally the principle of
religious and polit'ca1 neutrality which was basic with the union.
Although the purchasing department had made a start in the field of
production as early as 1900, when it bought a soap factory in Delft,
the purchasing service operated largely as an agency and did not
Netherlands
95
become a full-fledged wholesale until 1909. In 1914 it became a
separate organization, “ De Handelskamer,” and was joined by most
of the neutral associations as well as by various Catholic, Socialist,
and independent associations which were not willing to endorse the
neutrality principle. The wholesale confined its efforts to the com
mercial field and took no stand whatevt regarding political or re
ligious matters.
Of 284 associations affiliated with De Handelskamer at the begin
ning of 1918, 119 were affiliated with the Dutch Cooperative Union,
36 with the Social-Democratic federation, 32 with the Catholic
federation, and 97 were not members of any central organization.
Even as early as the period of the first World War, De Handelskamer
had its own packing plant where goods were put up under its own
trade-mark, “ Haka” ; also a chemical laboratory for food analysis, a
plant for making wooden shoes, and an experimental bakery. A
meat-packing plant was maintained from 1914 until 1918, when it
was discontinued because of Government restrictions. The whole
sale very early started an auditing department, in the attempt to
improve the accounting practices of its member associations and to
insure their financial stability. Its relations with its employees had
been regulated by collective agreement since before 1919.
In 1918 the Government desired to use the services of De Handel
skamer and its associations in order to fight the rising prices. With a
loan from the authorities, the wholesale built a clothing factory, with
branches in 6 cities. The new enterprise was immediately successful,
but when peace was concluded and the post-war slump came, the
wholesale was left with a large supply of goods made at high prices
which it could not sell, as well as the Government loan to repay. The
factories were closed in 1923, but at a loss that brought De Handel
skamer to the verge of bankruptcy. The local associations, however,
rallied to its assistance with new capital, and succeeded in saving it.
During the depression of the early twenties the business of the whole
sale and the number and membership of its affiliates declined. By
1926, however, its sales were on the upgrade and so continued through
1929. After a slight decline in 1931 they rose above the 1929 level in
1932, and this in spite of the fact that over 300,000 workers were out of
jobs (about 70,000 of these were cooperators), that their economic con
dition was reported to be below the average for Europe, and that in the
period 1927-32 the index of wholesale prices had fallen 35 percent
(from 149 to 97).
In 1932, 12 of De Handelskamer’s affiliates went into liquidation,
but 13 new associations joined, including “ De Volharding” with 17,000
members. Thus, the number of associations rose from 287 to 288,
and the combined individual membership served by the wholesale
increased from 162,702 in 1931 to 189,381 at the end of 1932.
In 1934, when the number of unemployed exceeded 400,000, the
wholesale reduced its prices on a number of commodities of general
necessity in order to help its member associations supply their needy
worker members. Notwithstanding this, its sales volume rose by
about 4 percent as compared with the preceding year. By this time,
30.5 percent of De Handelskamer’s sales consisted of its own manu
factures— clothing, cheese, perfumes, cosmetics and toiletries, jams,
cooking oils, and a variety of foods packed under its own label. In
96
Cooperatives in Individual Countries
1934, also, “ Vooruitgang” (“ Progress” ), the largest association in the
Netherlands, joined the wholesale, bringing in 51,280 members.
In 1932, on its fiftieth anniversary, De Handelskamer had moved
into a new headquarters building in Rotterdam. This move apparently
stimulated new interest and loyalty among the member associations,
for notwithstanding the depression, which was very severe, the mem
bership increased during the next few years and sales rose steadily
through 1937. A decline took place in 1938 (largely attributable to a
fall in wholesale prices), but the sales reached an all-time high in 1939.
Data are not available for De Handelskamer’s membership for 1939,
but in 1938, 292 of the 351 consumers’ cooperatives in the Netherlands
were members of the wholesale, and their combined membership
(258,896) accounted for slightly over 86 percent of all the 298,887
consumers’ cooperative members in the country.
The development of the wholesale over the 50-year period, 18901940, is shown in table 20.
T a b l e 20.— M em bership and Operations o f Netherlands Cooperative Wholesale, D e H an
delskamer, 1890-1940
fFor par values of currency, see Appendix table, p. 278]
O perations o f D e H andelskam er
Y ear
N um ber of
T h eir m em
affiliated
bership
associations
94,300
111, 124
192,401
287
288
288
151,808
147,137
148,198
162,702
189,381
199,042
11,304,306
13,885,748
18,283,115
17,427,458
18,447,923
21,691,984
2 468,716
445,529
574,000
850,000
999,000
1,434,000
289
290
298
295
292
254,736
258,090
262,516
261,350
258,896
22,414,770
25,128,900
25,681,810
28,118,700
27,893,093
30,140,000
27,792,000
2,062,000
2,701,000
16
41
92
138
159
385
1924.....................................................
1926.....................................................
1929.....................................................
1931.....................................................
1932....................................................
1933.....................................................
377
310
1934.....................................................
1935.....................................................
1936.....................................................
1937.....................................................
1938.....................................................
1939.....................................................
1940....................................................
0)
0
V alue o f ow n
p rod u ction
Florins
500,000
928,000
3,217,000
4,935,055
6,236,096
14,612,665
1890.....................................................
1900.....................................................
1909-10...........................................1914.....................................................
1915.....................................................
1920.....................................................
0)
A m ount of
business
7,000
17,000
(l)
0
0
Florins
0
0)
107,000
96,000
195,000
N e t earnings
F lo rin s
0)
0
41,000
39,000
59,000
15,000
0)
126,000
108,094
0
561,078
566,000
578,000
402,618
512,788
0
3,158,000
3,424,000
0
0
441,192
262,813
723,797
0
0
i No data.
JData relate to 1925.
Cooperatives and the W ar
The Netherlands, after having been assured that the country’s
neutrality would be respected, was invaded by German forces in
May 1940.
During the battle period there was much destruction both from the
war and from looting, cooperative as well as other property being
affected, Rotterdam— the headquarters of Vooruitgang, of De
Handelskamer, and of the Landbouw-Comit6— bore the brunt of the
German attack. The greatest cooperative loss was that suffered by
Vooruitgang, whose headquarters building and several branches were
completely demolished. So great was the destruction of life and
Netherlands
97
property in some parts of the city, and so great the resulting disloca
tion of life there, that the membership of the association fell from
48,637 to 24,212. The buildings of De Handelskamer “ escaped
serious harm.”
Apparently, after the military and civil overlordship was imposed,
the cooperative associations were allowed to continue operations,
under the “ mild” policy which the Germans first adopted. Diffi
culties of obtaining supplies, stringent rationing, and lack of transport
facilities drastically reduced cooperative sales, however. New taxes,
imposed on gross surplus and raising the rate from 11% to 31% percent,
reduced earnings to almost nothing. This resulted in a change of
cooperative price and dividend policy; some associations reduced
prices to the lowest possible level consistent with safety, and others
paid fixed patronage returns which were included with expenses of
operation.
The cooperatives continued their educational and training courses,
and in 1941 even created a chair of cooperation at the University of
Amsterdam.24 In 1942 De Handelskamer purchased an estate to
which it proposed to transfer all of its training activities.
German rule became harsher in 1942 and new measures were imposed
upon the populace. Among those affecting the cooperative movement
was one that dissolved the National Cooperative Council— repre
senting all branches of cooperation—that had been formed in 1934.
A new Cooperative Council of the Netherlands, covering only agri
cultural cooperatives, was formed to which all these associations were
required to affiliate. The Council was placed under the control of
the Department of Agriculture and Fisheries. It was given the
authority to liquidate any agricultural cooperative that failed to
affiliate within 4 months, any that was not large enough to permit
“ a useful performance of economic activities,” or any that failed to
meet its obligations. This move, as the International Cooperative
Alliance pointed out, “ means the isolation of the consumers’ move
ment and thus undoes a good deal of the progress made in recent years
in the direction of cooperative unity.” 25
24 B ut m an y educational institutions closed later in 1641 rather than accept N a zi con trol o f their educa
tional policies. It is n o t k n o w n w hether A m sterdam U niversity was one o f these.
28 S o u rces .—1T he report on the N etherlands is based u p on data from the follow ing pu blication s: Jaarcijfers
voor N ederland (N etherlands Centraal B ureau voor de Statistiek), 1922, 1923-24, 1827, and 1936; M aandschrift (N etherlands Centraal B ureau vo o r de Statistiek), issues o f N o ve m b e r 1922. June and Septem ber
1926. A ugust 1928, J u ly 1930, M a y 1936, M a y 1936, A pril 1937, J u ly 1938, and Septem ber 1940; H e t C oop eratieve N iew s (C entral C ooperative U nion, T h e H agu e), N o v e m b e r 16, 1924; International C ooperative
B ulletin (International C ooperative A lliance, L o n d o n ), issues o f July 1911, June 1912, June 1913, M a rch ,
July, and D ecem ber 1916, June-July 1918, M a rch and A p ril-M a y 1620, M a y-J u n e 1922, N o v e m b e r and
D ecem b er 1923, D ecem b er 1924, and June 1925; R e v ie w o f International C ooperation (International C o o p e r
ative A lliance, L o n d o n ), issues o f July 1929, Septem ber 1931, D ecem ber 1932, J u ly 1933, F ebruary 1934,
June 1935, July 1937, January, Ju ly, and O ctober 1938, A ugu st 1939, February and June 1940, Septem ber
1941, and Septem ber and D ece m b e r 1942; P e o p le ’s Y earbook (E nglish C ooperative W holesale S ociety,
M an ch ester), 1929, 1933,1935 throu gh 1939, and 1941; C ooperative Inform ation (International L a b o r O ffice),
N o . 12,1929, N o . 6, 1934, N o . 1, 1937, N o . 2,1940, and N o . 7, 1942; International D ire c to r y o f C ooperative
O rganizations (International L a b o r O ffice), 1939; Irish E con om ist (D u b lin ), O ctob er 1923; C ooperative
M o v e m e n t in the N eth erlands D u rin g the W ar P eriod (R e p o rt from U . S. T ra d e C om m issioner at T h e
H ague, M a y 1919 (u n p u b lis h e d )); R eports from U . S. consul at R otterd a m , D ecem b er 17, 1923, and N o .52,
O ctober 30, 1834; and H ollan d and the W ar, b y G . N . C lark (O xford P am ph lets o n W o rld A ffairs, N o . 43,
O xford, E n glan d , 1941).
98
Cooperatives in Individual Countries
Cooperative Movement in Luxemburg
Although the population of Luxemburg was only about one-third
agricultural, apparently the entire cooperative movement was rural.
The consumers’ cooperatives, which constituted about half of the
total number of associations, combined the functions of providing
supplies for farmers’ households and their productive operations with
the marketing of their produce. There were also specialized marketing
cooperatives handling particular commodities, such as livestock,
grapes, or dairy products. Each of these branches of the movement
had its own federation, as did also the Raiffeisen credit associations.
The consumers’ cooperatives were banded into the General Feder
ation of Agricultural Cooperative Associations {Federation des Associ
ations agricoles du Grand-Duche de Luxembourg) formed in 1909, but
its membership included other types of cooperatives as well. This
organization supplied its affiliates with household and farm supplies,
advised on marketing and accounting problems and on legal matters.
Its business in 1937 amounted to 28,716,000 francs.26
The status of the cooperative movement in 1937 is shown in
table 21.
T ab u s 21.— Num ber, M em bership , and Am ount o f Sales o f Cooperative Associations in
Luxemburg, 1937
[F or par values o f cu rren cy, see A p p e n d ix table (B e lg iu m ), p. 278]
N u m b e r of—
Type
T o ta l a m ou nt
o f business
of associations
A ssociations
M em bers
F ra n cs
R u ra l credit associations_________________________________
Onnsum firs’ su p p ly and sale association s
Specialized m arketing associations:
D a ir y _________________________________________________
V in egrn w ers'
F r u it and v e g e ta b le grow ers’
_
_ ........... _
liv e s t o c k and m e a t m a rk etin g
A gricu ltu ral and ru ra l in su ra n ce (liv esto ck )
1 N o data.
71
408
8,576
19,588
268
57
44
98
66
11,819
1,742
C)
3,100
1,876
(0
5,697,000
57,000
2 7,000
* P rem iu m incom e.
In 1930 the Government established a High Council for Agricultural
Cooperation and Mutual Aid, to consist of not more than 15 members
appointed for 4-year terms. Its duties were to promote and advise
cooperatives, give technical assistance, and distribute any Govern
ment subsidies that might be provided. After the beginning of the
depression subsidies were granted to marketing cooperatives in order
to assist them in selling their produce. Other decrees regulated the
sale of milk.
Luxemburg was invaded by the Germans on May 10, 1940, and
was annexed to the Reich on August 30, 1942. The opposition of
the people was expressed through their withholding of their crops and
livestock from the invaders and through a general strike. No data
are available regarding the fate of cooperatives either then or later.27
26 F or par values o f cu rren cy, see A p p e n d ix table (B e lg iu m ), p . 278.
27 S o u r c e s — T h e report o n L u x em b u rg is based u p on data from the fo llow in g p u blication s: C ooperative
O rganizations T h ro u gh o u t the W o rld — N um erical D a ta (International L a b o r O ffice), 1939; C ooperative
In form a tion (International L a b or O ffice), N o s. 4 and 14, 1929 and N o . 3, 1930; International D ire c to r y o f
C oop era tive Organizations (International L a b o r O ffice), 1939; E uropean C onference o n R u ra l L ife— L uxem
b u rg (L eague o f N ations, G en eva), 1939; N o te Statistique— E xtrait de L ’ A nnu aire Official 1930 (G ran d
D u c h y de L u xem bou rg, Office de S tatistiqu e).
Switzerland
99
Cooperative Movement in Switzerland
Grazing and forest associations were known in the Swiss mountain
valleys as early as the fifteenth century. The Swiss Confederation
itself sprang from the Mark-Genossenschaften, the village self-help
organizations which the Alpine peasants established in order to
supply their needs and cultivate the land in common. The Swiss
debt to the Rochdale Pioneers is, therefore, less than that of some
other peoples. The first cooperative association of the present Swiss
organization was founded as a consumers’ society at Zurich in 1851.
Within the next 25 years, an association of the Rochdale pattern was
formed in the town of Schwanden, a farmers’ organization was formed
near Winterthur, and others were organized at Basel, Geneva, and
elsewhere.
All types of associations expanded during World War I, suffered
in the long period of crisis and depression following that war, and
recovered during the late 1920’s. The depression of the early thirties
was accompanied and followed by restrictive Federal measures aimed
at control of both foreign and domestic trade and by special acts
directed against cooperatives and other large businesses.
Nevertheless, the cooperatives continued their steady increase of
membership and sales. By 1940 there were nearly 12,000 cooperatives
in a population of 4,000,000 people. The largest group of associations
consisted of agricultural cooperatives which included 2,900 dairy
associations handling 90 percent of Swiss milk production, almost
700 Raiffeisen credit cooperatives, and nearly 700 associations pur
chasing farm supplies.
Consumers’ distributive cooperatives numbered about 900 of the
nearly 12,000 Swiss cooperatives in 1940. The associations together
handled from 10 to 12 percent of the country’s retail trade and served
about one-fourth of the population. In the field of production, the
cooperative associations owned and operated the largest flour mill,
the largest meat-packing establishment, and the largest bakery in the
nation. The Basel cooperative was one of the larger associations on
the continent, with 62,295 members and annual sales of over 63 million
francs.28 Other large organizations were those at Zurich (28,826
members), Geneva (23,449 members), Bern (17,496 members), and
Luzern (12,790 members).
In the same year, when the Swiss Cooperative Union and Whole
sale, V. S. K., celebrated its fiftieth birthday, its 545 member societies
were scattered throughout more than 1,000 of Switzerland’s 3,000
local government areas and in all the four language regions of the
nation— the French, the German, the Italian, and the Romansh.
Eighty percent of all cooperative stores in Switzerland were then
carrying on business with V. S. K. In spite of the effects of war in
the countries surrounding the Swiss “ neutral island,” the federation’s
turnover amounted to 247 million francs and its annual patronage
refunds— calculated as usual in proportion to purchases— amounted
to 18 or 19 million francs.
Among the outstanding characteristics and accomplishments of the
Swiss cooperative movement may be mentioned its uncompromising
spirit of independence and its refusal to accept assistance from the*
* F o r par values o f cu rrency, see A p p e n d ix table, p . 278.
100
Cooperatives in Individual Countries
State; its elimination of competition between associations; its policy of
financing cooperative enterprise upon a basis of “ indivisible coopera
tive capital,” built up from earnings, etc., rather than from share
capital; the high degree of loyalty of local associations toward V. S. K .;
and the early prominence of cooperative leaders in national affairs
(presidents of four cooperative unions were elected to the National
Assembly as early as 1911).
T ypes o f Cooperatives
The Swiss cooperative movement was one of the most varied and
inclusive in Europe. It included, in addition to the usual retail as
sociations, agricultural consumers’ , dairy, machinery, cattle-breeding,
and pasture associations; restaurants and guest houses; transportation
by water; electricity- and gas-supply, credit, shoe-manufacturing,
bakery, sick-benefit, and burial associations.
The main periods of growth of the movement were the decades of
industrialization of the nation, beginning with 1890 and ending after
World War I in 1920, as table 22 indicates.
T a b l e 22 .— Num ber o f Cooperatives in Switzerland, 1 8 9 0 -1 94 0 , by T yp e
T y p e of association
1890
1900
1910
1920
A ll typ es................................................ '1, 551 3, 719 7,113 11,084
517
96
243
C onsum ers’ ..........................................
C redit (R aiffeisen )............................ !
2
3
150
33
151
Sickness and death fu n ds................ i
68
21
184
W ater s u p p ly ^ ..................................
331
144
1
9
E lectricity and gas............................
B u i l d i n g ................ ..............................
6
14
39
A gricultural:
845 1,459 2,086
Cheese and d a ir y .......................
C a ttle raising...............................
27
475
981
P urchasin g...................................
84
496
355
225
M a ch in ery _______________ ____
48
123
388
786 1,993
M iscellaneou s......................................
1925
11,284
1930
1935
1937
1939
1940
i
11,766 'l l , 680 ill, 723 11, 629 jll, 599
806
291
614
390
382
179
853
391
579
409
380
233
866
533
545
436
351
260
872
632
456
433
314
258
878
657
422
432
300
251
2,651
1,500
761
397
3,113
2, 731
1, 521
763
445
2,979
2,806
1, 527
730
443
3, 269
2,874
1, 439
698
439
3,265
2,911
1,493
701
• 457
3,221
,894 i
685
390
435
290
246
2,924
1, 509
696
457
3,103
898
688
385
436
287
244
2,924
1, 515
694
454
3,074
COOPERATIVE CREDIT
Raiffeisen associations.— As early as 1903 the agricultural societies
of Switzerland had begun to form Raiffeisen credit banks. By 1928
the credit associations had 292 cooperative banks in German-speaking
areas, 140 in French-speaking areas, and 3 in Italian-speaking regions.
Ten years later, confidence in the banks as savings institutions and
their higher mortgage and current account loans combined to make the
1941 report outstanding, as jnay be seen from table 23.
Credit cooperation has never developed widely in Switzerland, but
by the end of the twenties there were three central cooperative bank
ing and credit institutions— the Central Cooperative Bank (founded in
1927), the Union of Swiss Raiffeisen Associations (1902), and the
Swiss People’s Bank (1869).
101
Switzerland
T a b l e 2 3 .— Development o f Raiffeisen Banks in Switzerland, 190 3 -4 1
[F or par values o f cu rrency, see A p p e n d ix table, p. 278]
Y ea r
N um ber
N um ber
M em ber
of
o f de
ship
b an k s
positors
T u rn over
F r a n cs
F r a n cs
1,740
11,507
16,784
27,678
37.482
0)
( l)
0)
66,149
6,037,708
50,220,170
197,354,686
327.678,019
441,661,841
0)
0)
0)
0)
1,765,817
27,444,311
65,864,025
136.394,928
195,951,649
2 389,978,000
675,600
12,832,340
30,237,433
62,800,063
90,116,019
218,127,000
10,581
474,881
1,125,163
3,079,157
5,447,649
14,164,000
2 450.129,000
2 486,304,000
263,883,666
283,320,000
17,472,000
18, 705,000
1903................................
1 9 1 3 ..............................
1918................................
1923 ..............................
1927................................
1937— ..........................
1939
.......................
1940................................
1 9 4 1 .............................
25
166
224
332
435
0)
(i)
672
704
2,323
29,549
48,238
77,030
106,027
0)
217,000
225,000
237,000
T o ta l assets
D ep osits
R eserves
F r a n cs
F ra n cs
1 N o data.
2 Aggregate w orking capital.
Central Cooperative Bank.— The wholesale, V .S.K ., had outgrown its
own banking department created in 1911 to serve cooperative and in
dustrial associations and individuals, and when, in 1927, the Swiss TradeUnion Federation was contemplating the establishment of an inde
pendent bank, the Union of Swiss Distributive Associations voted
unanimously for joint action in the project. The Central Cooperative
Bank, thus formed, began operations with a subscribed share capital of
3,672,000 francs, of which 3,532,000 francs (about $674,000) were fully
paid up. Of this paid-up capital, V. S. K. provided 2,000,000 francs.
Share capital almost trebled during 1928, reaching 10,459,000 francs
at the end of the year. The bank’s growth in subsequent years may
be judged from its statements in 1935 and 1939:
19S5
1939
(fra n cs )
( fra n cs )
Turnover ........................................ 1, 233, 000, 000
Deposits_______________________
53, 734, 000
Paid-up capital________________
10, 500, 000
1, 150, 000
Reserves_______________________
2, 707, 246, 000
______________
10, 799, 000
1, 450, 000
By 1942 the problem of these associations had become that of ex
panding their business sufficiently to employ their expanding capital.
B U ILD IN G AN D HOUSING ASSOCIATIONS
Switzerland faced a severe housing shortage after World War I.
Private capital withdrew from such building during the war and its
place was taken after the war largely by capital from cooperatives and
public-utility groups acting with or without the aid of State and
commune. The growth of cooperative housing coincided with the
growth of cities during the period 1910-20. The associations increased
rapidly in number through 1931, after which they declined. Ten
thousand persons were members of housing cooperatives in 1933.
The work of the building and housing societies naturally centered in
the cities where it sometimes received the aid of the municipalities.
After 1925 the State ceased giving aid except when the groups of
houses were being built for larger families. At Basel, the building
associations could obtain funds from the powerful Cooperative
Association of Basel. Indeed, the latter built the suburban community
of Freidorf, consisting of 150 detached houses and store and school, to
accommodate cooperative employees.
102
Cooperatives in Individual Countries
Among cooperative building projects in which the municipality
assisted the cooperatives, the following were outstanding: At Zurich
between 1910 and 1930 the city spent 50,000,000 francs to help con
struct 2,044 houses containing 8,589 homes. By 1941 one-ninth of
Zurich’s 93,000 flats were cooperatively owned and their rents were
100 to 200 francs lower than rents for similar privately built apart
ments. Dwellings (except single houses) built with the aid of the
cooperative society in Zurich wTere rented, not sold. At Lausanne the
cooperative housing association with the aid of the city had erected,
before 1935, 26 individual houses, 8 two-family houses, and 3 apart
ment houses containing 60 dwelling units. At Bern, the munici
pality’s participation in the cooperative housing projects amounted to
8,700,000 francs before 1935. At Bienne, the city lent the cooperatives
funds on second mortgages at 5 percent. Cooperative housing in
cluded 213 houses built since 1925 at a cost of 4,000,000 Swiss francs.
At Geneva, where a cooperative building association was founded in
June 1919, both Federal and Cantonal grants were received. Fiftytwo family dwellings, erected at a cost of 1,225,000 francs, were almost
completed in December 1921.
LIFE IN SU RAN CE
Life insurance was provided by the Swiss Mutual Insurance Society
founded as a result of a resolution adopted at the congress of the
Swiss consumers’ cooperatives in 1918. From the begmning both
cooperative and trade-union groups supported the insurance associa
tion, and both acted as agents for it.
On its twenty-second anniversary in December 1941, the Swiss
Mutual Insurance Society announced that since its founding it had
paid out 15,433,000 francs to its insured. The Society’s guaranty
fund that year reached 18,790,000 francs.
1937
1984
(fran cs)
( fra n cs)
Amount of insurance outstanding___ 42, 759, 000
Premium income__________________ i 1,731,000
978, 000
Claims paid________________________
Total assets_____ ________ _____ ____ 16, 078, 000
Paid-up capital_____________________
350, 000
680,000
Reserves.......................................... ........
38, 873, 000
1,561,000
611, 000
13, 580, 000
250, 000
530,000
1931
(fr a n cs)
6, 448, 000
372,000
98, 000
2, 139, 000
50, 000
224,000
E L EC TR IC ITY COOPERATIVES
In 1937, the number of organized electricity cooperatives in Switzer
land was 300 and their membership 85,000, or an average of 283 per
association. By 1940 the number of associations had dropped to 287.
M ost of these associations were rather small enterprises. Some of
them were merely distributors of power purchased at wholesale, others
owned their own generating facilities. Near Basel, where many
industries— silk weaving, wood carving, pottery making—were carried
on in the homes, one large electric cooperative was operating success
fully in the early 1930’s. The association bought its energy at low
rates because it had three possible sources of supply and its rates were
at the level of operating expenses. This association, however, was
unusual.
103
Switzerland
Structure o f the Consum ers5 Cooperative M ovem ent
Swiss distributive cooperatives were federated into three main
central organizations: (1) The Cooperative Union and Wholesale of
Swiss , Consumers’ Cooperatives (Verband schweiz. Konsumvereine,
known as “ V. S. K .” ), formed in 1890; (2) Union of Swiss Cooperative
Associations, “ Concordia” (Verband der Genossenschaften “ Konkor
dia” ), formed in 1908; and (3) Union of East Switzerland Cooperative
Agricultural Associations (Verband ostschweiz. landwirtschajtl. Uenossenschaften, known as “ V. O. L. G .” ), formed in 1886.
The relative strength of these three federations in 1937 is shown
in table 24.
T
able
24.— Mem bers and Business o f Swiss Federations o f Cooperatives, 1937
[F or par values o f cu rrency, see A p p e n d ix table, p. 278]
C ooperative
U nion and
W holesale
(V . S. K .)
Item
N u m b er o f affiliated associations..............................................
N u m b er o f in d ivid u a l m em bers...............................................
540
413,715
Federations—
A m ou n t of sales_____ _________________________________
P aid-u p ca p ita l_______________________________________
T ota l sales o f m em b er a ssocia tion s....................................... .
200,488,233
1,676,000
299,252,000
U n ion o f E ast
Sw itzerland
C ooperative
A gricultural
Associations
(V . O . L . G .)
F ra n cs
326
24,104
F ra n cs
J 47,864,000
2,650,000
2 39,137,000
U nion o f Swiss
C ooperatives
( “ C on cordia” )
47
4,842
F r a n cs
3.340.000
48,000
6.574.000
i Inclu din g goods m arketed.
2 1936, including goods m arketed.
“ Concordia” Union.—The Concordia was a Christian-Socialist fed
eration, the membership of which consisted of Roman Catholic
distributive associations, mainly in eastern Switzerland. As indicated
in the preceding table, this federation was the smallest of the three,
accounting for only about 5 percent of the total affiliated associations.
T
ab le
25.— Sales o f Concordia Union o f Switzerland and its Affiliated Associations
[F or par values o f cu rren cy, see A p p e n d ix table, p . 278]
A ffiliated associations
Y ea r
N um ber
o f stores
Sales
P atronage
refunds
F r a n cs
F ra n cs
Sales o f the
Federation
F r a n cs
1910-11.......................................................................................
1915-16.......................................................................................
1919-20.......................................................................................
1924-25.......................................................................................
1929-30.......................................................................................
40
60
144
192
133
2,319,000
2,893,000
9,475,000
10,890,000
8,764,000
147,000
135,000
324,000
466,000
508,000
730,000
2,022,000
7,466,000
6,231,000
4,289,000
1933-34.......... J..........................................................................
1935-36.......................................................................................
1937-38.......................................................................................
1939-40......................................................................................
140
139
114
114
7,155,000
6,723,000
6,077,000
6,925,000
447,000
421,000
374,000
414,000
3,373,000
3,356,000
2,989,000
3,816,000
104
Cooperatives in Individual Countries
V . 0. L. G. federation.— The V. O. L. G. federation was a combina
tion distributive and marketing federation for its affiliated “ agricul
tural consumers’ associations.” Of 438 stores operated by V. O. L. G.
affiliates in 1935, 229 carried in stock all foodstuffs, household goods,
brushes, twines, basketry, glass, china, office supplies, drapery, and
footwear. In 1930, 61 associations owned agricultural equipment for
the use of their members; 48 associations operated feed mills, 4 oper
ated distilleries, and 7, bakeries; 15 had cider presses and 8 had flour
mills. V. O. L. G.’s business in consumer goods then amounted to
18,533,000 francs, and its business in farm supplies totaled 14,890,000
francs; agricultural products marketed totaled 4,188,000 francs.
The Cantons of Aargau and Zurich contained a complete network
of agricultural associations and there V. O. L. G. supplied 40 to 53
percent of the population’s agricultural requirements. In the Cantons
of Thurgau and Grisons the agricultural unions were also strong and
in 7 others they were fairly well scattered. Farmers made up nearly
80 percent of the membership. The local organizations were usually
small; only 44 had a turnover above 200,000 francs and 85 had less
than 100,000 francs. In 1935, 229 out of 314 affiliates were consumers’
associations and 139 were engaged in marketing produce. Of these,
130 had subsidiary enterprises, including fruit-juice extractors, mills,
bakeries, distilleries, and butcheries.
Swiss Cooperative Union and Wholesale, V. S. K .—By far the largest
of the three federations was V. S. K., with headquarters at Basel. Its
membership included over 60 percent of the total number of distribu
tive associations, and their sales accounted for nearly 87 percent of the
total cooperative business. V. S. K. itself carried on a wide variety
of merchandising, productive, and educational and service activities.
Intercooperative relations.— In the course of the years, some over
lapping of function between the consumers’ cooperatives and the agri
cultural cooperatives had developed. Generally these matters were
settled amicably by negotiations between the associations concerned.
Thus, in the city of Geneva, where the consumers’ cooperative had
been processing and distributing dairy products and milk, an associa
tion was formed (representing both the cooperative association and
the milk producers) wThich operated the stores and the milk routes and
distributed the earnings between the two groups.
In 1933 an agreement between V. O. L. G. and V. S. K. provided
for joint purchases by the two federations wherever possible, elimina
tion of competition between them, and an understanding that each
would purchase as much of its supplies as possible from the other
(agricultural products from V. O. L. G., and manufactured products
and consumer goods from V. S. K.).
Relations among all the branches of cooperation in Switzerland were
coordinated through the Committee for Intercooperative Relations.
Development o f Consumers’ Cooperative M ovem ent
As noted, Swiss consumers’ cooperation in its modern form dates
from 1851, with the formation of an association at Zurich. Growth
wras fairly rapid, being contemporaneous with the urbanization of
Swiss life and the development of new forms of retail trade.
Expansion occurred in all branches of the cooperative movement in
Switzerland during the first World War, but during the post-wrar crisis
105
Switzerland
years between 1920 and 1925 both membership and sales declined.
By 1927 the nation was so well organized cooperatively that a coop
erative speaker asserted no further growth could be expected. The
movement continued to expand, nevertheless, and in the 5-year period
from 1930 to 1934 both membership and sales rose markedly, while
average purchases per member increased by nearly 50 percent.
In this period Swiss retail trade included the newer forms of trade,
such as the large department store, the modern specialty shop, auto
mobile (or “ rolling” ) stores, etc., operating side by side with the
peddler, the market, and the old-time fair. Although small retailers
still controlled over 77 percent of the total shops in Switzerland, they
were increasingly alarmed by the spread of cooperatives operating
many branch stores (and accounting for over 12 percent of the total)
as well as by the large-scale joint-stock and partnership companies
which together accounted for about 10 percent of all the stores. Or
ganizing into trade associations, the private dealers began to agitate
for restrictive legislation and in 1933 were successful in obtiaining
passage of a law limiting the opening of branch stores; in 1937 they
obtained a law levying special taxes upon chain-store organizations
and cooperatives.
Although the cooperatives succeeded in obtaining representation on
the bodies which passed upon applications for the opening of new
branch stores, the Government interpreted the “ purchase obligation”
clause in V. S. K .’s bylaws (adopted in 1935) as making all of its
affiliated associations branches of the wholesale. They were there
fore forbidden to open new premises or to alter or extend their present
ones without express permission.
During this period, also, the operations of cooperatives and their
federations were curtailed by a series of Government regulations estab
lishing foreign-trade quotas and controlling prices. Notwithstanding
these difficulties the consumers’ cooperatives continued to increase
both membership and sales steadily from year to year.
T a b l e 2 6 .— Operations o f M em bers o f Swiss Union o f Consumers’ Associations, V . S. K .,
18 97 -1 942
[For par values of currency, see Appendix table, p. 278]
Year
Number
of asso
ciations
Mem
bers
Number
of stores
Sales
Net earn
ings
Patronage
refunds
Value of
property
Francs
Francs
Francs
Francs
1897.............................
1900............................
1905.............................
1910.............................
1920............................
1925.............................
71
116
204
328
493
521
53,365
83,549
141,349
213,018
363,420
352,172
279 21,798,000 2,318,000 1,696.000
419 32,725,000 3,204,000 2,392,000
671 54,436,000 4,953,000 4.054,000
1,008 101,000,000 8,567,000 6,997,000
1,824 325,857,000 16,550,000 12,997,000
2,010 276,367,000 15,944,000 13,303,000
1,318,000
1,916,000
4,149,000
8,262.000
19,628,000
21,894,000
1930.............................
1933.............................
1934.............................
1935.............................
1936............................
1937.............................
523
533
534
535
541
540
362,953
389,451
397,142
402,339
407,737
413,715
2,232
2,404
2,416
2,423
2,436
2,452
296,513,000
284,787,000
279,538,000
274,200,000
283,178,000
299,252,000
21,177,000 17,640,000
20,900,000 17,659,000
20,598,000 17,601,000
20,098,000 17,273,000
20,504,000 17,711,000
21,043,000 18,640,000
31.755,000
38,960,000
40,223.000
41,104,000
42,150,000
43,168.000
1938.............................
1939.............................
1940.............................
1941.............................
1942..........................
543
545
546
0)
546
421,100
427,166
430,315
443,000
461,000
2,454
2,469
2,472
0)
2,498
307,069,000
326,440,000
350,191,000
373,200,000
406,100,000
22,065,000
23,228,000
23,892.000
0)
26,470,000
44,904,000
47,149,000
48,965.000
1No data.
588544°— 44------ 8
19,471,000
20,463,000
21,560,000
22,500,000
23,800,000
8
106
Cooperatives in Individual Countries
V . S. K .— A Four-Language Cooperative Federation
Although .V. S. K. had begun as an agency for collecting statistics
and formulating economic policy, it early added a wholesale distrib
utive department which soon outstripped other functions. By 1939,
Y. S. K. was the largest customer for Swiss-made goods and Swiss
agricultural products and the nation’s largest-scale importer of the
goods it handled. V. S. K. handled 80 percent of all the macaroni
and sugar consumed in Switzerland.
To some extent it had attained this position through use of such
measures as exclusive purchasing agreements made with some of its
affiliates and (after 1935) the inclusion in its bylaws of a “ purchase
obligation” for member associations covering certain staple commodi
ties. Direct purchases abroad enabled it to buy to better advantage
the foreign goods it needed.
The development of its business activities is indicated in table 27.V
.
T a b l e 2 7 .— Growth o f Swiss Cooperative Wholesale, V . S. K ., 18 95 -1 942
fFor par values of currency, see Appendix table, p. 278]
Year
Affiliated
associations
Total sales
Net earn
ings
Reserves
“ Social" capi
tal
F rancs
F ra n cs
Francs
F ra n cs
1895................................................
1905................................................
1915................................................
1925................................................
1935................................................
1936................................................
55
204
407
521
535
541
1,134,955
9,143,129
50,193,162
125,251,195
177,148,267
188,476,063
1937...............................................
1938................................................
1939.............................................. .
1940................................................
1941...............................................
1942................................................
540
543
545
546
(0
546
200,488,233
207,029,695
227,869,001
247,083, 976
244,236,000
263,690,000
9,109
87,141
479,383
635,342
746, 719
722,140
655,685
578,326
583,222
579,218
0)
0)
16,250
57,000
748,200
1,592,600
1,673,800
1,675,600
1,675,800
1,675,200
1.677,000
1,680,200
0)
0)
3,600
180,000
1,600,000
4,200,000
9,000,000
9,500,000
10,000,000
10, 500,000
11,000,000
11,500,000
0)
(0
lNo data.
P R O D U CT IVE A C T IV IT IE S
V. S. K .’s interest in the use of production as a controlling influence
on prices began before the first World War, when the refusal by the
cooperative bakeries of Zurich and other towns to agree to a price
increase set by the Swiss Master Bakers' Association brought about
a boycott of the cooperatives by the syndicate of Swiss mill owners.
In consequence V. S. K. purchased in 1912 one of its first productive
enterprises— the municipal flour mill at Zurich— and organized the
Flour Mill Association of the Swiss Distributive Associations. Flour
rices immediately fell 3 francs (58 cents) per 100 kilograms and the
our cartel dissolved. By 1935, the cooperative milling association
had a turnover of 8,528,923 francs. It not only operated the largest
mill in the entire country but it had built up a fund of 2,000,000 francs
to finance expansion.
Inability to obtain adequate supplies, at equitable prices, and
contests over price levels were the motivating influence leading to
other productive ventures by Y. S. K. A long boycott of coopera
tives by shoe manufacturers was broken when V. S. K. began con
struction of its own factory in 1911. This enterprise, originally a
department of V. S. K., was reorganized as an independent federation
§
107
Sudtzerland
in 1925, its operations being controlled by the 125 local associations
which became its members. By 1938 this enterprise— the Swiss
Shoe Cooperative (Schuh-Coop)— had annual sales amounting to
8,368,000 francs, of which 1,670,000 francs represented its own manu
factures. After the beginning of World War II the private interests
again attempted to prevent shoe supplies from reaching cooperatives,
but with what success is not reported.
Although some local associations operated their own butcheries,
the meat output was not sufficient to supply the whole consumers’
cooperative movement. In 1914, therefore, V. S. K. purchased a
substantial interest in the largest meat-packing enterprise in Switzer
land, with the understanding that the federation would discourage
further cooperative meat production. The arrangement proved to
be satisfactory and profitable to both parties.
The so-called “ chocolate war” was an open fight by the coopera
tives against monopoly. V. S. K. inaugurated a boycott against the
chocolate trust, in which it was joined by all but 11 of its affiliated
associations and by V. O. L. G. The boycott ended when the cartel
abandoned its quantity-discount practice to which V. S. K. was
opposed.
V. S. K. by 1937 was operating several farms and a coffee-roasting
plant. It was also financially interested in a cigar factory, a garden
truck association, a wholesale furniture association, the National
Union of Cheese Manufacturers at Bern, the National Poultry
Federation, and other similar enterprises. (See table 8, p. 29.)
Nev
ertheless, only about 11 percent of V. S. K .’s total sales were of goods
of its own production. Among the obstacles to the development of
cooperative production were the competition of strong privately
owned companies, the demands of the cooperative employees (said
usually to be greater in the case of cooperative than of private em
ployers), V. S. K .’s policy of dealing only with member associations,
and the lack of international connections, especially for technical
innovations.
The membership and business of some of the productive enterprises
for the year 1937 may be seen from table 28.
T a b l e 2 8 .— Swiss Consumers’ Productive Enterprises, 1937
[For par values of currency, see Appendix table, p. 278]
Item
Number of member associations............
Number of individual members_______
Coopera Coopera
tive Dairy tive flour
Leman
Society of
mills of
Coopera
Swiss dis Swiss dis tive
Flour
tributive tributive
Mills
associa
associa
tions
tions
20
F ra n cs
220
291,061
F rancs
Amount of sales......................................... 4,986,000 12,099,000
783.000
22,000
Share capital paid up...............................
52,000
200.000
Reserves_____________________________
49
F ra n cs
2,004,000
146,000
98,000
Coopera
tive shoe
factory
Coopera
Cigar
tive furni
ture asso factory
ciation
1 125
F ra n cs
8.368.000
1.196.000
1.200.000
F ra n cs
1,409,000
110,000
2,000
F ra n cs
281,000
57,000
1 Figure relates to 1938.
In the midst of the chocolate war, V. S. K. had begun widespread
use of the label “ CO-OP” which then and later was an influential
factor in increasing its sales and in unifying the cooperatives as pur
108
Cooperatives in Individual Countries
chasers. V. S. K.'s avowed object in all these struggles had been to
safeguard the consumer's interests by assuring him a fair price. A
similar policy actuated the union in the early establishment of a
laboratory for testing the quality of goods. Long before the Swiss
Government brought in its Federal foodstuffs legislation, the union
had a chemical laboratory of its own, directed (after 1918) by a wellknown Swiss scientist.
Sw iss Cooperatives and the State
The Swiss consumers' cooperative movement was essentially non
political, although, as individuals, cooperative officials served on
Government committees and sat as members of the Swiss Parliament.
Y. S. K., however, had confined its contact with Government to its
own specific problems and had never formulated any concrete program
of legislative or political action.
Until the emergencies preceding and arising from World War II,
Swiss cooperatives were little touched by national legislation. They
literally did not exist in law until the Commercial Code went into
force in 1883. Even that code made no mention of federations. It
left the legal definition of “ cooperative" so elastic that the Swiss
could develop “ an unparalleled abundance of cooperative types and
forms," and so loose that even profit-seeking organizations could
and did use the cooperative form. Not till the completion of the
revised Commercial Code in 1937 was the cooperative association
mentioned separately from commercial companies and clearly defined
as an organization for self-help.
Before the end of the 5-year period (1937-1942) provided for the
cooperatives' transition to the 1937 law, the Swiss cooperatives had
to submit to new taxation and other forms of emergency State control
already mentioned.
With the Government's war policy of control of imports, consump
tion (rationing) and prices, and war taxes, V. S. K., collaborated
wholeheartedly. It met severe rationing well by laying in large sup
plies. Under a law of 1940, it had paid a tax on turnover and a
3-percent tax on all cooperative refunds in excess of 5 percent of
sales. When the wartime rise in prices continued in 1943, V. S. K.
advocated that the State take over the increase for the more important
foodstuffs and lay a special tax to cover the cost. ‘ It had defended
the consumer against “ unjust" taxation and had succeeded in having
eggs, fruits, and vegetables placed on the tax-exempt list, and the
tax on the main foodstuffs and soap kept down to 2 percent.
In 1941, the Government had imposed the full weight of the original
1933 decree relating to the opening of new or branch stores, and pro
hibited all expansion except by special license. By midsummer 1943.
the cooperatives faced a proposed Federal decision to broaden and
continue the licensing system after the war in a way which would
actually mean “ a fundamental reorganization of large sections" of
the Swiss economy. Since the Director of the Federal Office for
Industry, Trade, and Labor had announced this new policy to the
Swiss retail traders, without consulting any cooperative opinion,
cooperatives believed that the Federal Council planned to create “ a
privileged position for these [the private traders] groups, a kind of
monopoly for the defense of their business interests against an in
Scandinavian Countries
109
convenient competition.” Cooperative speakers stressed the co
operative refusal to ask for State help in the past and their own
representative character, coming as they did from “ all sections of
the population, workers, farmers, artisans, teachers, people of all
political and religious creeds, who set aside their individual opinions
and interests to serve the common interest through cooperative
action.” 29
Scandinavian Countries
The Scandinavian countries have been noted for the wide acceptance
of the cooperative idea, especially among the farmers. Consumers'
cooperatives, however, were not far behind. In Finland, from 30 to
40 percent of the nation's retail trade was done by cooperatives.
Unlike the situation in many other countries, where the national
cooperative wholesale of the consumers' cooperatives entered pro
duction as part of a definite policy of self-sufficiency, in the Scandi
navian countries cooperative production was rarely undertaken
where supplies were obtainable from private sources at equitable
rates. Even in accordance with this conservative policy, the devel
opment of cooperative production nevertheless had become a sub
stantial part of the wholesale's business in each country. The con
tests between the Swedish cooperative wholesale, K. F., and the
cartels controlling certain commodities of wide consumer use resulted
in drastic price reductions benefiting not only cooperators but Swedish
consumers in general.
In addition to their domestic operations the Scandinavian cooper
ative movements have been cooperating among themselves for the
past 25 years, through the Scandinavian Cooperative Wholesale
(Nordisk Andelsforbund, known as “ N. A. F .” ), formed in 1918 on the
initiative of K. F. Its headquarters office is in Copenhagen and its
members are the national cooperative wholesale associations of
Sweden, Denmark, and Norway, and the two wholesales of Finland.30
The business of N. A. F., which acted as joint purchaser for its mem
bers, has naturally been affected seriously by the war, especially as
Denmark and Norway have been under enemy occupation, and Fin
land has been cooperating with the Nazis. Nevertheless, during 1942
it was able to make purchases for all of its members. As would be
expected, trade with Sweden furnished the lion's share of N. A. F.'s
business in 1942. The distribution was as follows: Sweden 87.9
percent, Denmark 7.3 percent, Finland (both wholesales combined)
3.9 percent, and Norway 0.8 percent.3
9
39 Sources .— The report on Switzerland is based upon data from the following publications: Annuaire
Statistique de la Suisse (Bureau Federal de Statistique, Bern) 1939, 1940; Rapports et Comptes sur l’acti-
vite des organes de 1’Union (Union suisse des Cooperatives de Consummation, Basel) 1940,1941; International
Directory of Cooperative Organizations (International Labor Office), 1939; International Cooperative Bul
letin (international Cooperative Alliance, London), issues of April, October, and November 1911, March
and October 1912, January and February-March 1914, December 1918, January and December 1919, JulyAugust and November-Decerober 1921, November 1925, and May 1927; Review of International Cooper
ation (International Cooperative Alliance, London), issues of June and November 1928, May and December
1932, April 1934, August and September 1935, March and November 1936, April 1937, March, May, August
and October 1939, February and June 1940, November 1942, August 1943, January 1944; People’s Yearbook
(English Cooperative Wholesale Society, Manchester, England), 1929, 1930, 1934, 1937, 1938, 1941; Annals
of Collective Economy (Geneva), January-April 1941; Report of the Inquiry on Cooperative Enterprise
in Europe in 1937 (Washington, 1937); La Cooperation—Journal populaire suisse (Basel), issues of April 18
and June 20,1942, and August 14,1943.
so For additional information on N . A. F. and its operations, see p. 37.
110
Cooperatives in Individual Countries
Cooperative Movement in Denmark
When in 1940 the German Nazis invaded Denmark the cooperative
organizations were left practically untouched. That the Danish co
operative movement was not liquidated as in other invaded countries
was undoubtedly due in part to the characteristics which placed it
among the foremost in the world— its powerful agricultural coopera
tives and their successful experience in the export trade.
About 90 percent of the population living on Denmark’s 206,000
farms belonged to one or more cooperative associations. Practically
every phase of the farmer’s economy was organized cooperative^.
He obtained his farm and household supplies from the cooperative
store, his produce was marketed through cooperative associations.
Personal insurance as well as protection for crops, buildings, and live
stock were available through cooperative insurance associations.
Cooperative dairies handled approximately 95 percent of all Danish
milk, and about one-third of the butter exports throughout the world
came from Danish cooperatives. In 1935, the cooperative associa
tions of that country handled the following proportions of the totals of
various Danish goods exported: Eggs, 25.1 percent; cattle, 39.1 per
cent; butter, 47.1 percent; and bacon, 84 percent.
The consumers’ cooperatives, though not so well known, were also
important in the nation’s economy. Almost 10 percent of the popula
tion of Denmark were members of distributive cooperatives and,
counting the families, about a third of the Danish people were being
served by them. The cooperative associations accounted for about 17
percent of the total retail trade.
The cooperatives, being such a large force in the economic life of
the country, were able to exert considerable influence upon prices.
On several occasions they even entered upon the production of com
modities the price of which they considered unreasonable. Thus,
when a rolled-oats company kept its prices artificially high, the coop
eratives began manufacturing this commodity and brought prices
down by 26 percent. A somewhat similar effect upon the price
of twine was exerted by development of a cooperative industry
manufacturing 20 percent of the national output of such twine.
Ordinarily, however, the cooperative movement did not undertake
production when it was well treated by private producers.
Danish cooperative success was attained without either the protec
tion or the restraint exercised by a cooperative statute. No body of
actual law for cooperative associations, except for credit organiza
tions, existed in Denmark. For the two generations before the
Social Democrats first took over the Government in 1924, the farmers
had held the majority in the lower house of the Danish Parliament.
They were responsible for progressive legislation which provided a
democratic credit system, greatly enlarging the number of individual
landowners, and which developed education and social insurance.
For the cooperatives, however, the farmers introduced no special
legislation. In the early years, almost all cooperatives were unin
corporated organizations witii unlimited liability, operating simply
under the provisions of the common law and controlled by the mem
bers, each of whom had one vote only. Cooperatives which sold only
to members were not required to obtain licenses and were not taxed
on earnings; with this exception, cooperative associations carried on
business under the general statutes regulating all Danish trade.
111
Denmark
T ypes o f Cooperatives and Their Activities
Cooperatives played a part in many lines of enterprise in Denmark.
The greatest variety occurred in the associations serving the farmers.
Farm products were marketed either directly or after being processed,
and the sale of these commodities was carried on in foreign as well as
domestic trade. Necessaries for farm and household were supplied
through cooperative channels, as were also insurance of many kinds,
credit, electric power, and even hospital care. Nearly all types of
cooperatives had their own federation.
The consumers’ cooperatives, although not so varied in kind, were
almost equally well developed, and there was also a small group of
workers’ productive organizations.
The relative development of the Danish cooperative movement in
1937 is indicated in table 29. It should be noted that the membership
given in the case of the agricultural cooperatives contains a great deal
of duplication and the figures should not be totaled. Probably in no
country in the world was the individual farmer a member of more types
of associations than was the case in Denmark.
T a b l e 2 9 . — M em bership and Operations o f Danish Cooperatives in 1937, by T yp e
[For par values of currency, see Appendix table, p. 278]
Type of association
N u m b e r of
associations
M em b er s
B usiness
Local associations
K ro n er
Consumers’ associations.............................. .
Bakeries
................ .............................
Breweries and dairies *...........................
Restaurants i.................. .........................
Store associations...... ............................ .
Workers’ productive associations................
Fishermen’s.............................................
Craftsmen’s..............................................
Other 1...................................................
Housing associations3*7
8
....................................
Insurance associations............................ .......
Electricity associations3................................
Rural credit associations3.............................
Other agricultural associations:
Productive, processing and marketing.
Purchasing................................................
368, 495,006
15,100,006
19,700,006
4 ,9 9 5 ,0 0 6
328,700,000
29,747,000
10,204,006
5,543,000
14,000,000
< 8 ,8 7 0 ,0 0 6
*14,334,006
1,963
36
2
33
1,882
76
36
18
22
17
7
283
100
391,100
(?)
<*)
25,000
366,100
21,356
«152 ,1 0 0 ,0 0 6
2,299
1,476
476,262
93,275
1,050,000,000
133,600,006
(1
2)
(2)
(2)
(2)
12,980
658,795
(2)
(2)
Federations
Consumers’ associations:
Cooperative Wholesale (F.D.B.)_„
Bakery supplies 1...............................
Coal supply.........................................
Agricultural associations:
Marketing of agricultural products.
Manufactures......................................
Purchasing of—
Agricultural supplies..................
Coal...............................................
Central banks............................................
Sanitarium.................................................
K ro n er
1
1
2
4
2
5
1
2
1
71,841
7 36
7174
206,800,006
15,095,000
8,000,006
7 960
71,775
✓
7 3,025
7 1,030
8 1,333
71,077
222,335,000
13,300,000
1 Data relate only to associations affiliated to central federation.
3 No data.
3 Data relate only to associations affiliated to central federation.
* Income from rents. Value of dwellings constructed in 1937 was 6,847,000 kroner.
3 Premium income.
8Total turnover.
7Number of member associations.
8Number of member associations, 1 bank only.
156,005,006
9 ,6 0 0 ,0 0 6
500,006
112
Cooperatives in Individual Countries
H O U SIN G ASSO CIATIO N S
Cooperative housing associations have played a small but im
portant part in the provision of living quarters in Denmark. Even
as early as 1919 the local associations were sufficiently numerous
to form their own central organization.
The Danish Union of Workers’ Cooperative Building and Housing
Associations was formed when housing cooperatives were beginning
construction on a considerable scale in Austria and Switzerland, but
the period of greatest Danish activity came after 1933. An act of
that year, designed to replace dwellings of pre-war construction,
authorized the Government to grant loans up to 95 percent of the
building costs to municipalities and cooperative housing organiza
tions and up to 70 percent of the cost to private builders. As a
result of this law the number of dwellings constructed nearly doubled
in 1933-34.
After 1938 the municipality of Elsinore took advantage of a new
Danish law which provided for nonprofit projects to provide housing
for large families. One cooperative association undertook the con
struction of 102 apartments, leaving direct technical supervision
to the State and the municipality. Capital was obtained from credit
associations and the State, but only 5 percent was required from the
families and this amount might be guaranteed by the municipality
in the case of families of more than two children.
The Union of Workers’ Cooperative Building and Housing As
sociations was a member of the Cooperative Union (Det Kooperative
Fsellesforbund) and, as in the case of other associations affiliated to
that Union, its members were mainly industrial workers. In 1937
the housing federation had 17 member associations and they in turn
had 12,980 individual members. The largest building cooperative
was the Workers’ Mutual Building Society which then had 5,000
members and 4,200 apartments to its credit. That organization
financed its construction as follows: 40 percent of the capital necessary
for an apartment was obtained on a first mortgage from a credit asso
ciation, 15 percent from an association taking second mortgages, 10
percent from the members (who were the tenants), and the remainder
(up to 90 percent) from the State under the law of 1933. After the
mortgages were paid off, rents were reduced to the level necessary
for adequate maintenance. The next largest cooperative building
association— the Workingmen’s Society— operated 3,000 apartments'
in the mid-thirties and used methods similar to those of the Mutual.
The part share of the cooperatives in the provision of Danish
housing after 1933 is shown below.
D w ellings constructed by—
Co&pP u b lic
P frn te
eratives
authorities
builders
1,042
1933______
1934________________________________
575
1935_^_________________________
249
1936
____________________________
340
1937
____________________________
299
1938
____________________________
482
254
1, 197
254
266
836
770
15,079
21,403
22,436
17,540
17,403
13,369
E L E C T R IC IT Y COO PER ATIVES
The Danish electric-power business was largely in the hands of the
public, through operation either by political subdivisions of the State
113
Denmark
or by cooperative associations. The development of rural electrifica
tion had begun before World War I and was greatly accelerated by the
shortage of fuel oils during that war. Farmers combined in coopera
tives and prospective consumers took shares. Many of the coopera
tives at first owned both generating plants and lines. When towns
and municipalities began electrification later, some of them “ whole
saled” power and the farmer cooperatives maintained the lines and
operative functions. Occasionally the town and the cooperative in
the surrounding area became partners in generating power.
In the mid-1930’s Danish rural electricity cooperatives numbered 283
and served a large part of the nation’s agricultural area. Their
annual sales of power were about 100,000,000 kilowatt-hours, which
amounted to from 20 to 25 percent of the total power sales of the
country. Later reports indicated that the rate of expansion of the
cooperatives was not keeping pace with that of the municipal com
panies.
C O O PER AT IVE SO C IETIES’
SA N IT A R IU M
In 1904, several dairy associations organized the Danish Coopera
tive Societies’ Sanitarium (Andelsforeningernes Sanatorieforening).
The sum of $50,000 was raised by subscription by cooperatives and
their members and a hospital and sanatorium was built. At the end
of the depression of the 1920’s more than 1,000 cooperative associations
were members of the sanatorium association. Its growth in member
ship and income since 1930 is indicated below:
Affiliated
associations
1928—......................... - ..........- .......... 1,072
1931— ___________________
1934.........................................
1937........................................
1939________________________
T heir
m em bers
Gross income
of sanitarium
(kroner)
188,838
500,000
1,074 190,880 600,000
1,077 193,810 100,000
(>)194,307 500,000
(•)359,496 500,000
i No data.
C E N T R A L F E D E R A TIO N
OF D A N ISH C O O PER ATIVES
Coordination of the branches of the Danish cooperative movement
was effected through the Central Federation of Danish Cooperatives
(De samvirkende danske Andelsselskaber) formed in 1917. To it in 1937
were affiliated the following federations and central organizations:
Union and Wholesale of Danish Distributive Societies (F. D. B .).1
Association for the Purchase of Goods for the Cooperative Societies of Ringkobing.
Association of Cooperative Dairy Societies.
Association of Cooperative Butter Export Societies.
Association of Cooperative Bacon Factories.
Danish Cooperative Egg Export Society.
Federation of Danish Cooperative Cattle Export Societies.
Danish Seed Supply and Seed Growers’ Association.
Jutland Cooperative Society for Feed Purchase.
Islands Cooperative Society for Feed Purchase.
Funen Cooperative Society for Feed Purchase.
Danish Cooperative Fertilizer Supply Societj^.
Danish Cooperative Coal Supply Society.
Danish Cooperative Cement Factory.
Association of Danish Cooperative Agricultural Insurance Societies.
Cooperative Bank of Denmark.
Danish Union of Cooperative Credit Societies.
Danish Cooperative Societies’ Sanitarium.
1 F. D . B. participated also on an international scale through membership in the Scandinavian Cooper
ative Wholesale Society (see p. 37).
114
Cooperatives in Individual Countries
Development o f Consumers’ Cooperatives Through 1939
Consumers’ cooperatives made their first appearance in Denmark
in 1851. In 1871 the first attempt at centralized purchasing was
made under a plan developed by Pastor Hans Christian Sonne, and a
wholesale association was formed which was later absorbed into the
Union and Wholesale of Danish Distributive Associations (.Faellesforeningen for Danmarks Brugsforeninger, known as “ F. D. B .” ) formed
in 1896.
For many years almost the whole of the consumers’ cooperative
movement of Denmark was in the rural areas, and there were almost
no consumers’ cooperatives. The wholesale was accordingly composed
mainly of farmers’ cooperatives, which in 1929 were obtaining 83 per
cent of their supplies from it. In 1934 this proportion had risen to
89 percent and by 1937 to 91 percent.
Meanwhile in the urban centers a small trade-union cooperative move
ment had developed, consisting of associations operating bakeries, res
taurants, and stores, providing dwelling accommodations, etc. Each of
these types of associations had its own federation and all in turn were
affiliated to the Cooperative Union (Dei Kooperative Faellesforbund)
formed in 1922. This trade-union group also had its own bank and
insurance organizations.
The depression of the early 1930’s drew members to the urban
consumers’ cooperatives, as the following figures indicate. That they
still constituted a very small part of the total distributive movement
of Denmark, even in 1934, is shown by the fact that the 36 distributive
associations accounted for only 60,860 of the total membership of
319,100 and 22% million of the total business of 171% million kroner
in that year.
U rban
cooperatives
1931____
1932.
...............
1933.
...............
1934__________
30
32
32
36
M em bership
42, 230
52,200
55,400
60, 860
Turnover
(kroner)
14, 922, 100
15,925,700
18,803, 500
22, 501, 100
Though the Danish consumers’ cooperative associations did not
receive as much attention outside Denmark as did the agricultural
associations, they had become almost as widely organized. In 1934
the existing 1,883 consumers’ cooperatives with their 319,100 members
represented almost 10 percent of the country’s population— a propor
tion exceeded only in Great Britain, Finland, and Switzerland with
about 16,14, and io percent respectively. Including family members,
however, one-third of the Danish people were in some way associated
with the consumers’ cooperatives, which were doing about 10 percent
o f the retail trade of Denmark at that time.
The large district associations found in France and Belgium were
not a feature of the cooperative movement in Denmark, where the law
prevented the formation of branches outside the headquarters locality.
(This provision had also checked the growth of chain-store organiza
tions operating in a number of towns or cities.) The Copenhagen
cooperative, with its 100 retail outlets (all within the city limits),
31,000 members, and annual business of over 13 million kroner, was a
marked exception to the rule. Only 13 other Danish cooperatives
had more than 2 stores at the end of 1937 and more than 90 percent of
all associations had only 1 place of business.
115
Denmark
The average cooperative was nevertheless considerably larger than
the average private business 3 and when in the early thirties the
difficult world conditions began to be reflected in depression in Den
mark, attacks upon the cooperative movement by the private
merchants (who were still doing some 90 percent of the total trade)
became increasingly bitter. However, as the cooperative associations
represented such a well-established and conservative element of
Danish economy, the attacks had little or no effect.
The foreign economic situation was more serious, for Denmark’s
whole business system was geared to its foreign trade. The Govern
ment attempted in various ways to overcome the effects of restriction
of markets and the resulting accumulation of surpluses of export
commodities. Among these were destruction of cattle, reduction of
taxes, abandonment of the gold standard, negotiation of trade agree
ments with England, and imposition of import and export quotas.
Although cooperative leaders recognized that Denmark was departing
from its traditional free-trade policy only under the compulsion of
events, they opposed quotas based upon trade of previous years be
cause the membership and business of the cooperatives was growing.
Nevertheless, in the absence of a complete change in the entire Danish
economy, the fact remained that public policy was determined largely
by the farmers and partially by the cooperatives.
Total turnover of consumers’ associations even rose during the
depression (table 30) and costs of operation fell— from 10.1 percent
in 1932 to 8.9 percent in 1936. Patronage refunds averaged 7 percent
in the latter year. In 1938, the consumers’ associations reported an
improving financial position, for of their working capital their own
net worth (shares, reserves, and funds) represented 53.3 percent and
46.7 percent was loan capital (members’ deposits, sums owing for
goods, credits, etc.). In the Copenhagen consumers’ cooperative, net
worth constituted 74.6 of the working funds. In the one year 1936,
the net surplus of the consumers’ associations amounted to 23,500,000
kroner, from which were paid patronage refunds amounting to
19,200,000 kroner.
T
able
3 0 .— M em bership and Business o f Consumers’ Distributive Cooperatives in
Denmark, 1930-41
[For par values of currency, see Appendix table, page 278]
Year
103ft
1931........................
1932 ......................
1933 ...................
1934 ......................
Num
ber of
associ Members
ations
Amount of
business
Year
Num
ber of Members
associ
ations
K ro n e r
1,823
1,825
1,852
1,866
1,883
331,550
331,000
315,500
317,600
319,100
147.500.000
134.700.000
138.100.000
155,000,000
171.500.000
Amount of
business
K ro n er
1935....................... i 1,891
1936.......................
1,898
1,882
1937.......................
1938 ...................... 1,891
1939.......................
1,901
1941.......................
1,933
i 424,355
437,625
1366,100
i 376,000
i 392,000
419,200
1313,200,000
338.000.
000
328.700.000
342.000.
000
361.500.000
<*>
i Membership of 1 group not reported.
* No data.
* In 1938 the average business per cooperative association was 184,000 kroner. Among the private dealers
61 percent had an annual business of less than 25,000 kroner, 5 percent a business of 100,000-200,000 kroner, and
2 percent a business of more than 200,000 kroner.
116
Cooperatives in Individual Countries
Federations o f the Consumers9 Cooperative M ovem ent
Among the consumers’ cooperatives there were three groups of
associations federated respectively in the Danish Cooperative Union
and Wholesale (“ F. D. B .” ), the Cooperative Union of industrial
workers, and the Ringkobing association (.Ringkobing Amts Vareindkohsforening). The industrial group had no wholesale of its own
and some of its members were affiliated with F.D.B., which included
practically all of the consumers’ cooperatives in Denmark. The
Ringkobing was a small regional joint-buying organization, the mem
bership of which in 1937 included 70 local associations with 10,000
members and a total annual business of about 3,600,000 kroner.
C O O P E R A T IV E U N IO N A N D W H O L E S A L E SO CIETY
The F. D. B. from the date of its formation in 1896 had a steady and
consistent growth, even during depression years.
By 1916, more than 1,500 cooperative associations with 240,000
members had joined the wholesale. Its annual sales in that year
amounted to 87,686,567 kroner and its production to nearly 18,656,716
kroner. By 1927, turnover had risen to more than 133,000,000
kroner and the value of production to 36,869,238 kroner. The whole
sale then had branch warehouses in 15 towns and factories in 6.
Beyond its regular business of production and sales, it maintained a
seed-testing bureau, organized bookkeeping classes, supported the
Middlefart Cooperative College, and published a journal which
reached 140,000 subscribers. Ten years later, these miscellaneous
services had been widely extended to include (1) a central laboratory
which carried out analyses and experiments, to the number of 2,872
in 1937 alone; (2) an architects’ office which not only dealt with the
wholesale’s extensive building program (representing a value of
2,450,000 kroner), but also advised consumers’ societies.
T
able
31. — M em bership and Business o f Cooperative Union and Wholesale Society of
Denmark, F . D . J&., 1 9 2 0 -3 9
{For par values of currency, see Appendix table, p. 278]
Wholesale (F. D. B.)
Member associations
Year
Number
Member
ship
1920........................
1922......................
1924.......................
1920........................
1928........................
1,792
1,805
1,804
1,802
1,784
335,104
337,535
337,500
323,500
321,500
1930........................
1931........................
1932........................
1933........................
1934........................
1,791
1,796
1,819
1,833
1,853
321,500
821,500
306,500
307,600
309,100
1935........................
1936........................
1937........................
1938........................
1939........................
1,869
1,856
1,855
1,864
1,870
344,000
367,500
366,100
376,000
392,000
Amount of
business
K ro n er
JNo data.
0)
(5)
0)
0)
0)
0)
0)
(!)
0)
0)
0)
303,800,000
327,000,000
340,000,000
359,000,000
Amount of
business
K ro n er
Value of
own produc
tion
K ro n er
Net earn
ings
Patron
age re
fund (as
percent
of sales)
K ro n er
203,355,621
123,410,344
169,585,367
136,868,832
134,368,629
41,882,214
29,735,463
46,186,675
38,932,259
38,079,154
5,061,457
6,233,070
11,642,057
6,642,929
8,701,963
3.0
5.0
6.0
5.0
5.0
143,534,129
181,512,764
135,158,025
151,900,000
168,000,000
39,645,475
36.783,474
38,477,258
42,900,000
47,500,000
10,786,099
(')
8,862,857
7.0
6.0
7.0
7.0
7.0
184,200,000
195,800,000
206,800, GOO
198,100,000
216,200,000
51,165,000
55,800,000
60,600,000
59,700,000
65,100,000
11,181,211
0)
(l)
10,918,000
80)
6.5
(l)
0)
0)
0)
Denmark
117
The wholesale society’s productive policy was friendly to private
manufacturers. It entered the field only when private interests did
not serve it well. When tobacco merchants, for example, attempted
a boycott, the cooperative wholesale began the processing of tobacco.
By the year 1937, the wholesale’s largest productive works was the
margarine factory at Viborg, Jutland, and the coffee-roasting plant at
Kolding was next largest. That year F. D. B. purchased 4,600,000
kilograms of coffee beans, or 17.3 percent of all Danish coffee imports.
(For products of F. D. B .’s 20 productive works, see table 8, p. 28.)
The wholesale and the Danish agricultural associations worked
out so satisfactory a system of collaboration for grass seed that
F. D. B .’s turnover of this commodity was greater in proportion to
the national consumption than that of any other article which F. D. B.
supplied. Agreements begun in 1906 and amended in 1913 and 1926,
defined the productive and distributive activities of each
ultimately established a method of collaboration between x
__
and consumers which, according to a report of the International
Cooperative Alliance, might well serve as a model.
Cooperation Under the N azis
When the Germans invaded Denmark in 1940, the nation’s retail
establishments numbered 78,207 and their turnover amounted to
2,959,600,000 kroner. Cooperatives were doing 17 percent of this
retail business. In fact, the Danish cooperative associations formed
so integral a part of the national economic life that, when the Germans
occupied the country, the cooperative machinery and services appear
to have been maintained practically intact.
According to a report from the International Cooperative Alliance,
the Danish Government collaborated with the invaders at the begin
ning. Sugar, tea, and coffee rationing, which had already begun, was
continued more drastically, but the most severe effect of the German
occupation was felt by the producers and consumers of vegetable oils,
cereals, dairy products, and meats— the products in which the coop
eratives had been most active. Lack of raw materials caused F. D. B.
to cease operation of its margarine factory temporarily in April 1940.
Under a Government order of May, only large, low-income families
could obtain margarine. A decree for the compulsory delivery of
cereals was issued in the summer of 1940. Although the allocation
for livestock was cut by two-fifths and 50 percent of the pigs and
poultry were to be slaughtered, so much cereal was carried off to
Germany and used by the German army of occupation that by mid
summer the country was relying on the year’s bad harvest. Bread
rations were consequently greatly reduced. The price of bread in
Copenhagen rose from 90 ore per loaf in the summer to 145 ore in the
autumn and Parliament had to approve a grant of 16,500,000 kroner
to maintain prices at 121 ore.
At the end of October 1940, the number of cattle in the country had
been so greatly reduced that milk production was not expected to
exceed 60 percent of the customary total. The Germans took the
butter which would, in normal times, have been exported to England
(15,800 tons in May 1940 alone); Danish butter exports fell to 5,400
tons by September. The German Reich Office for the Milk Industry
arranged with the Danish Butter Executive Committee to increase
118
Cooperatives in Individual Countries
the price of butter to 450 kronen per 100 kilograms, thus doubling the
price of the preceding year. In the first quarter of 1941, prices were
raised still further and export was stimulated. However, the price
of German coal imported into Denmark was increased also, and
eventually domestic milk deliveries suffered most unfavorably. Be
fore the year 1941 ended, Germany’s share in Danish foreign trade
reached 80 percent.
In 1941, the International Cooperative Alliance reported that
German policy had already reduced supplies to a critical point. By
the end of 1942, a reduction of more than 12 percent in the Danish
cooperatives’ productive works had taken place. In October 1943,
the I. C. A. commented upon “ the depletion of all livestock, general
economic impoverishment” and deficiencies.
Until 1940 cooperatives had been taxed only on that part of their
earnings that had been derived from business with nonmembers.
The Extraordinary Income and Property Taxation Law of 1940-42
subjected the total net earnings of cooperatives to both a property
tax and a progressive income tax.
During the first year of the German occupation, Danish coopera
tive membership increased from 348,000 to 394,000 and in 1941-42
trade as well as membership of the Copenhagen Consumers’ Coopera
tive grew. The Wholesale Association, F. D. B., entered the general
publishing field in 1940 by founding a legally independent publishing
association, “ Det Danske Forlag.” Though freedom was sufficient
to permit the new society to publish a book on “ Fundamental Prin
ciples of the Consumers’ Movement,” the cooperative publishers met
opposition from the private interests in the trade. At the Parliamen
tary elections, the Danes cast the largest vote in their history; the
Nazis lost 3,000 votes, and the four large democratic parties gained
365,000 more votes than they had in 1939. Other indications of the
survival of democratic institutions— cooperative or not— are lacking.4
Cooperative Movement in Finland
In cooperation, Finland was one of the most highly organized coun
tries of Europe. The Finnish cooperative movement developed widely
and rapidly because the Finnish people were accustomed from early
times to fishermen’s, trappers’, and other guilds which required con
formity to a common principle and the distribution of rewards in
proportion to the members’ participation. Though farmers and labor
ers had established separate, independent cooperatives in the nine
teenth century, 1899, the year of the formation of the Central Union
of Finnish Cooperative Associations, Pellervo-Seura, by Prof. Hannes
Gebhard, lecturer in agriculture at the University of Helsinki, marked
the beginning of the modern Finnish cooperative movement. Finland
had then been an autonomous duchy of Russia for 90 years.
4 S o u rces .—1The report on Denmark is based upon data from the following publications: Statistisk Aarbog
(Statistiske Departement, Copenhagen), 1930,1933,1935, 1937, 1938, 1940, 1941; International Directory of
Cooperative Organizations (International Labor Office), 1933, 1936,1939; Review of International Coopera
tion (International Cooperative Alliance, London), issues of September 1928, February 1930, March 1935,
January and May 1936, February, June, and August 1937, January and September 1938, January, May,
and July 1939, January and March 1940, March 1941, June, September, and December 1942, October 1943;
People’s Yearbook (English Cooperative Wholesale Society, Manchester, England), 1934, 1935, 1938, 1939,
1941; Quarterly Journal of Economics, vol. 27, November 1912; Report of the Inquiry on Cooperative Enter
prise in Europe in 1937 (Washington, 1937); Denmark, A Social Laboratory, by Peter Manniche, (Oxford
University Press, 1939); Democracy in Denmark, by J. Goldmark and A. H. H. Hoilman, (Washington,
D. C., 1936); Denmark, the Cooperative Way, by Frederic C. Howe (New York, 1936); The Cooperator
(New York, N. Y .), April 19, 1943.
Finland
119
Through the work of Pellervo and Prof. Gebhard, information on
cooperatives was spread, model rules and expert advisers were pro
vided to help in establishing cooperatives, and a law legalizing coopera
tive associations was passed by the Government at Helsinki in 1901.
With this support, the consumer movement quickly reached out from
industrial to rural areas, where Gebhard found the same conditions
which had influenced Raiffeisen to develop rural banking in Germany.
In Finland a central organization to provide rural credit was formed
prior to the local associations, and this policy of growth from the center
out, of one nation-wide organization in each field, was adopted and
carried out except in the case of consumers’ cooperatives and in
Swedish regions where schisms caused duplications.
The activities undertaken by the consumers’ cooperatives were
many and varied, and the cooperative movement greatly increased
the efficiency of the whole economic structure of this northern agri
cultural nation. After 1920, cooperatives assisted Finland’s hundreds
of thousands of former tenants, small landowners, and settlers to
revise their economy. Through their participation in cooperatives
a large part of the population received the advantages of modem
technical processes, of an organized system of credit, and of wholesale
buying and selling. Large-scale output and distribution reduced the
middleman’s expenses and enabled the farmers to receive for their
produce 70 to 75 percent of the prices paid by the consumers in the
cooperative dairies. In addition to providing these economic advan
tages, the cooperative associations (particularly their central unions)
raised the standard of professional skill among their members and
helped educate the Finnish people in the principles of business manage
ment, collaboration, and self-government.
During the years of peace the consumers’ cooperative movement
grew in both size and economic stability and by the onset of the second
World War was supplying half of the population and doing about a third
of the entire retail trade of the nation. Losses incurred in the war
with Russia were great, but in spite of them the movement continued
to grow. Data on developments since Finland threw in her lot with
Germany in 1941 indicate that membership has continued to grow,
but scarcities of goods have cut down cooperative sales.
T ypes o f Cooperatives
The following cooperative central unions were in existence before
Finland became independent of Russia in the spring of 1918:
Y e a r in
which
founded
“ Labor” Central Agricultural Supply Cooperative Association (Swedish).
Central Bank of Cooperative Agricultural Credit Associations, O. K. O—.
Finnish Cooperative Wholesale Association, S. O. K _____________________
“ Hankkija” , Agricultural Cooperative Wholesale Society________________
“ Valio” , Federation of Finnish Cooperative Dairies_____________________
General Union of Consumers’ Cooperative Associations, Y. O. L_________
Central Union of Finnish Distributive Associations, K. K _______________
Cooperative Wholesale of the Central Union of Finnish Distributive Asso
ciations, O. T. K ___________________ ________ _____________________. . .
Central Livestock Cooperative Association______________________________
“ Unity,” Cooperative Butter Export Association (Swedish)______________
1897
1902
1904
1905
1905
1908
1916
1917
1918
1918
120
Cooperatives in Individual Countries
With the achievement of Finnish independence6 and the Land Act
of 1918 (which gradually increased the number of landowners), the
consumers' and agricultural cooperative movements took on new
vigor. The Swedish Cooperative Union in Finland was established
in 1919. The Central Cooperative Egg Export Association (“ Muna” )
the Forest Owners' Central Organization, and the Union of Coopera
tive Associations in Aland, were formed in 1921 and a number of
insurance associations within the decade of the 1920’s. Table 32
provides detail on the growth of cooperative associations in the early
twentieth century and illustrates clearly the great increase in rural
organization.
T
abxe
32.— Num ber o f Cooperative Associations in Finland, in Specified Years, 1 9 0 5 -3 3
Type of association
ATI typ e s _ _.
__
Crmsr^mp^rx,
C redit
Telephotift
_
_ .
_ .
_ .
1905
.. .
. _
1910
1914
1918
1919
1920
1921
1922
592
1,929
2,300
2,991
3,120
3,281
3,422
3,634
5,460
166
140
512
416
517
512
689
708
737
713
91
45
770
728
112
58
788
775
120
72
790
949
127
87
545
1,401
335
l 250
225
4
7
362
191
85
436
235
127
494
295
172
494
303
181
71
504
320
188
77
515
333
185
79
541
2»39
202
89
50
363
473
633
485
524
545
580
696
400
110
195
7
5
1,516
Elentrinity
A g n m lfia ra h
D a ir y
_ ____
M ach in ery
T n rf
Egg m arketin g .......
C attle m a rk e tin g .
Forestry
M isfififlanemis *
1933
>Including sawmill and flour mill.
* Miscellaneous for 1906, 1910, 1914, 1918 includes chiefly agricultural associations; tor 1933 it includes
1,216 agricultural associations.
The leading form of cooperative in Finland consisted of the consum
ers' groups, which included 16.6 percent of the population and
accounted for 30-40 percent of the retail trade of the country. Coop
erative dairies and milk-marketing associations, with 77,155 members
and 20,395 collaborating nonmembers, ranked next in size; egg
marketing organizations and the cooperative slaughterhouses were also
important. Among the successful types of rural cooperatives were the
more than 1,100 credit associations with a membership of 152,500.
Many consumers' cooperatives also had savings and credit depart
ments. Other forms of cooperation developed in Finland were insur
ance cooperatives (one group of consumer associations, S. O. K., was
served by three insurance organizations and another, K. K., by two)
and housing cooperatives which began to grow before World War II.
The variety of the Finnish cooperatives in 1937 is indicated in the
statement below:
N um ber
M em bers
Ail ty p e s .______________ _______ _______
5,330 868,373
Consumers’ _____
Housing________
Credit, rural____
Insurance______
Forestry________
Electricity, rural
Agricultural____
539 562, 300
100 1,800
1, 179 147, 500
392
0)
4
2,800
183 11,400
2,933 142,573
1No
data.
* The Constitution was adopted July 17, 1919, and peace was finally made with Russia by the treaty of
Tartu in 1920.
Finland
121
Cooperative housing.— Though the need for cooperative housing was
great, this branch of the cooperative movement developed slowly in
Finland. In 1910 almost 70 percent of the population of Helsinki
lived in the one-room flats which constituted 74 percent of all housing
in the city. Rents were controlled during World War I and prac
tically no building was done. In 1919 about 50 percent of the popula
tion still occupied one-room flats and some 96,000 out of a total of
157,000 families lived in one- or two-room dwellings.
The first cooperatively owned apartment house (with 250 rooms)
was erected in Helsinki in 1919. The following year 1,300 rooms were
cooperatively built, in 1924 some 5,400, and in 1926 about 10,000.
To finance construction, each apartment owner paid 50 percent of the
cost, the cost per room being about 30,000 markkaa.6 By 1926 it was
reported that every member of the Helsinki bricklayers’ union owned
a cooperative apartment of 2 or 3 rooms. The cooperative housing,
however, apparently did not meet the need, for it was reported in the
late 1930’s that the building that was being done was mainly for the
better-paid classes and the poorer workers were still paying as much as
25 to 30 percent of their wages in rent.
After negotiations of some length, the “ progressive” cooperative
associations (including the wholesale, O. T. K., the Elanto association
of Helsinki, and the cooperative insurance company, Kansa), the
Housing Reform Associations, and other groups founded a cooperative,
the Central Housing Association (“ Haka” ), in the autumn of 1938.
Haka undertook the construction of buildings, and founded the ten
ants’ associations. Under Finnish law these associations were usually
limited companies. The associations sold shares, generally at the
rate of about 310 markkaa per square meter of the floor area (as con
trasted with the 1,000 markkaa charged by private housing companies),
and the sum so accumulated constituted the capital of the association.
After the shareholders paid 15 percent of the cost, the remainder was
advanced by reliable financial institutions and the city of Helsinki
which granted second mortgages from a special fund.
Development o f Consumers’ Cooperatives
Though the consum ed cooperatives did not actually begin as an
organized movement in Finland until the opening of the twentieth
century, a distributive association was founded in Viipuri (Viborg)
in 1878 and others appeared elsewhere in the 1880’s and 1890’s.
Uniformity among early cooperatives was promoted in 1904 when
Vaino Tanner (later Prime Minister of Finland and always a sup
porter of cooperatives) and the Pellervo Association assisted in the
formation of the Finnish Cooperative Wholesale Association (Suomen
Osuuskauppojen Keskuskuntay known as “ S. O. K .” ). Four years
later the need for a special organization to carry on educational
work caused the founding of the General Union of Consumers’ Co
operative Associations (Yleinen Osuuskauppojen Liittoy known as
“ Y. O. L .” ). Under the policy immediately adopted by the central
body,, local cooperatives were urged to discourage credit sales and
to build up capital by requiring membership investment of 10 to 25
markkaa (19-48 c^nts) per person.*
* For par values of currency, see Appendix table, p. 278.
588544°— 44------ 9
122
Cooperatives in Individual Countries
The incentive to cooperative expansion resulting from the work of
S. O. K. and Y. O. L. coincided with the resurgence of national
ambitions. The systematic restriction of Finnish autonomy that had
begun with the Russian manifesto of 1899 was ended temporarily by
the assassination of the Russian General-Governor of Finland in 1904
and the disturbances of 1905 in Russia. The Finnish Diet was
restored and the Finns established a form of representative govern
ment extremely democratic for that day. Another period of Russian
repression followed. Between 1906 and 1910 consumers7 cooperative
membership declined (table 33), but in the 4-year period between
1914 and 1918 consumers7associations developed quickly, the member
ship rising from 97,000 to 255,000 and sales from 71 million markkaa
to 482 million markkaa. At the end of 1919 Finland’s officially
registered cooperative associations totaled 3,135, or 1 cooperative for
every 1,200 inhabitants; and there was 1 cooperator for every 7
inhabitants.
T a b l e 33.— M em bership and Operations o f Finnish Distributive Cooperatives, in Speci
fied Years, 1 90 2 -2 3
[For par values of currency, see Appendix table, p. 278]
Year
1902.........................................................................
1906..........................................................................
1910.........................................................................
1914..........................................................................
1918............. .............................................................
1922 ...... ..................................................................
1923..........................................................................
Member
ship
Number
of stores
6,000
60,000
37.000
97.000
266,000
342,000
352,000
34
274
452
415
585
601
596
Amount of sales
Amount of share
capital and
reserves
M arkkaa
M arkkaa
1,200,000
22,000,000
47.000.
000
71.000. 000
482,000,000
1,800,000,000
1,945,000,000
800,000
3.400.000
6.800.000
47,900,000
112,200,000
131,600,000
Finnish industries, particularly paper pulp and textiles, were then
reaching large-scale size and the changes in Finnish economy and
thought had split the Finnish cooperative movement. Between 1870
and 1915, while the nation’s population grew from 1,769,000 to
3,301,000, the town population quadrupled. Within the membership
of S. O. K. and Y. O. L. in which both agricultural and urban groups
were included, differences developed over cooperative principles,
attitude toward labor, and the so-called “ socialistic innovations.” A
number of urban associations withdrew in 1916 and 1917 and estab
lished their own Central Union of Finnish Distributive Associations
(Kulutusosuuskuntien Keskusliitto, known as “ K. K .” ), and their own
wholesale, the Cooperative Wholesale of the Central Union of Finnish
Distributive Associations (<Osuustukkukauppa, known as “ O. T. K .” ).
This division had scarcely occurred when the Finnish revolution
began, with a strike in which cooperative employees took part, and
cooperative warehouses were plundered. S. O. K. was declared the
property of the State, and a member of one of the new consumers’
cooperatives became its commissioner. The fighting ended in the
spring of 1918 with the complete establishment of Finland’s independ
ence. Both the new and the old consumers’ cooperatives suffered
from the revolution but ultimately the Finns founded a compromise
democratic government, moderate views prevailed, and the entire
cooperative movement survived.
123
Finland
A second division within the consumer movement took place 3 years
after the first, when the Swedish cooperatives in Finland— some 229
associations situated mainly in Wasa—withdrew from Pellervo.
In spite of these separations, the growth of the original federation,
Y. O. L., of the original wholesale, S. O. K., and of their affiliated
associations did not suffer perceptibly. Three years after the ‘ ^pro
gressive” associations withdrew from Y. O. L., the latter’s affiliated
associations had increased by 81 and the number of shops and mem
bers showed a similar increase. At the end of World War I these
“ neutral” associations had 200 gasoline stations throughout Finland.
Associations
Before schism:
1915__________ - ............... ................ 431
1916____________________ .................486
Y. O. L., after schism:
1918__________ _________ ................ 524
1919____________________ _________567
Stores
M em bers
980
1, 257
110, 800
1, 302
173, 564
181, 700
1, 610
201, 307
The growth in the membership and sales of the member associations
of both of the central federations continued until 1929, the sales of
K. K. affiliates doubling between 1920 and 1925. By 1930, 423 con
sumers’ cooperative associations belonged to the neutral Y. O. L., and
112 to the progressive K. K. Their total membership then numbered
467,480 in a population of 3,667,067, and their total sales aggregated
2,988,984,233 markkaa. The value of the combined sales of the two
wholesales was 1,679,566,779 markkaa. In the depression year of
1932, when 2.5 percent of the Finnish population was unemployed,
cooperative sales fell 20 percent as compared with 1928. No co
operatives went bankrupt, however, and cooperative purchasing loy
alty increased, as is customary in depressions, S. O. K .’s sales rising
3 percent. In 1931, associations affiliated to S. O. K. purchased from
it 79 percent of the articles they sold.
Consumers’ Cooperatives P rior to Outbreak o f W orld W ar I I
DEVELO PM EN T OF LOCAL ASSOCIATIONS
A characteristic of Finnish consumers’ cooperatives was the variety
of goods and services offered by them. Many of the Y. O. L. rural
associations were general-purpose associations, their stores providing
as many as 5,000 different articles, including household and hardware
utensils, groceries, cloth, shoes, ready-made clothes, feed, fertilizer,
poultry, bicycles, gasoline, etc. They also purchased eggs, grain,
butter, meat, etc., from the members for sale in the cooperative stores
and on the open market. The associations of the progressive K. K.
group often had both rural and urban members and handled thousands
of different items. The affiliates of both Y. O. L. and K. K. operated
savings departments, cafes and restaurants.
The local associations also engaged extensively in production,
mainly of bakery goods and beverages. In 1935 the value of the total
production of Y. O. L. and K. K. affiliates was almost 300,000,000
markkaa. In 1938 the enterprises operated by affiliates of Y. O. L.
numbered some 140 and were mainly bakeries. Their total output
was valued at 64,000,000 markkaa and in 1939 at 71,300,000 markkaa,
an increase of 11.4 percent. The annual output of the enterprises
operated by K. K. associations—-more urban than those of Y. O. L.—
had then reached a value of 404,000,000 markkaa.
124
Cooperatives in Individual Countries
By 1938 some 550 consumers’ cooperatives were in operation in
Finland. Their membership had increased 25 percent in the past 5
or 6 years and their retail stores handled about 30 percent of the retail
trade of the nation. Their chains of modern, well-equipped stores,
more than 6,000 in number and efficient and attractive in character,
covered the country and served 606,000 members, representing 50
percent of Finland’s population. Distributive sales totaled 5,137
million markkaa in 1938 and total capital 745 million markkaa (table
34). The movement ran 361 restaurants in 1939, often distinctive for
their attractiveness and good cuisine. More than 300 productive
units, working in or with these cooperatives, manufactured goods
valued at 444 million markkaa in 1938.
T a b l e 34.— M em bership and Operations o f Cooperative Commercial Associations, in
Specified Years, 1 9 0 5 -3 9
[For par values of currency, see Appendix table, p. 278]
Year
ions
1910
Stores
Number of
Cafes Pro
associations
and
Number
duc
res
of mem
tive
tau works
bers
Regis
rants
tered Active
, , T___
_________________
210
695
980
1920.................................... 2,422
1925.................................... 3,084
1930____________________ 3,908
40
126
178
4,930
*5,281
5,625
6,031
6,059
235
258
285
328
361
1935....................................
1936....................................
1937....................................
1938....................................
1939....................................
Amount
of sales
Own
capital
Net earn
ings
1,000
markkaa
1,000
m arkkaa
1,000
m arkkaa
138
227
249
171
525
553
801
802
796
155
405
413
623
582
534
26,360
79,021
110,864
330,887
387,477
466,911
10,811
43,589
89,158
1,450,145
2,381,885
3,985,809
540
3,381
8,136
64,599
203,334
388,182
277
294
322
314
319
779
779
785
790
791
532
534
539
542
545
517,529
537,106
562,279
605,988
640,810
3,319,963
3,761,984
4,671,760
5,137,656
5,465,952
474,089
512,040
561,397
630,133
654,066
354
1,267
3,612
30,381
40,476
53,813
72,326
86,742
117,425
115,044
119,880
The “ Elanto” association at Helsinki.—The largest distributive coop
erative in Finland and one of the largest in northern Europe, was the
“ Elanto” (“ Livelihood” ) of Helsinki. It was started with the aid of
Pellervo in 1905 when an official inquiry exposed very unsanitary con
ditions in the bakery trade. The original activity undertaken was a
bakery which delivered its first load of bread in 1907 and was rebuilt
on a scale sufficient to supply half of Helsinki in 1925. The associa
tion added milk products to its activities in 1911, groceries in 1914,
meats in 1917, a savings department in 1919, and drug stores and
factories making chemical and drug products in 1920. By 1923
Elanto was operating, besides these, a leather factory, a brewery for
light beer, a jam factory, saddlers’, mechanical, and knitting mills, a
soap works, two farms, and 136 retail stores. Membership was
then 29,659, value of production 86.8 million markkaa, and the amount
of sales 167.7 million markkaa.
The Elanto association emphasized high quality and low prices
and did not hesitate to go into production when necessary to secure
these. Other characteristics of the association were its cash policy,
the efficiency of its stores and restaurants, its fixed 2-percent patron
age refund, its policy of transferring 30 percent of earnings to
reserves, the large amount of these reserves, its enlightened labor
policy, its progressive democratic administration, and the influence
of its policy upon business competitors. Its financial position was
very strong, for its business was financed largely by its own funds.
125
Finland
By the mid-1930’s, Elanto had begun the use of traveling shops
and added a flour mill, a mineral-water plant, a laundry, a steampower plant, and restaurants and cafes. By 1940 Elanto was operating
394 branches and 18 restaurants. In the first year of the war, Elanto
was responsible for feeding the majority of the population of Helsinki.
Its development is shown below:
Mm-
T u r n o ve r
( markkaa)
bers
. 7,207
.19, 161
.23, 612
.28, 405
.31, 865
.42, 329
49, 736
. (9
53, 218
70, 000
1915
1918
1919.
1920
1925.
1930.
1935.
1936
1937.
1940.
O w n fu n d s
( m arkkaa )
49,175,067
2, 039, 378
33,
935,084
0)
57,
804,464
0)
17,
945,958
487, 306
28,
918,062
4, 713, 990
309,
545,039 61, 861, 111
271,
916,547 58, 861, 111
342, 000, 000
0)
401,
000,000
0)
502,
000,000 103, 000, 000
* No data.
DEVELO PM EN T OF CEN TRAL FEDERATIONS
The trend of membership and operations of the associations affiliated
with each of the central federations, Y. O. L. and K. K., is indicated
in table 35. Y. O. L. associations in 1939 still greatly outnumbered
those in K. K. The latter, however, were by far the larger associations,
their average membership being 3 times as large as that of Y. O. L.
associations and their average business being over twice as large.
T able
35.— M em bership and Operations o f Affiliates o f Finnish Federations, Y . O. L .
and K . K ., in Specified Years9 1914r-43
[F or par values o f cu rrency, see A p pen d ix table, p. 278]
Affiliates of Y . O. L. (“ neutral” )
Year
1914...................................................
1918...................................................
1920...................................................
1925...................................................
1928...................................................
1930...................................................
1932...................................................
1935...................................................
1936...................................................
1937...................................................
1938...................................................
1939...................................................
1940...................................................
1942...................................................
Number Member
ship of
of associa
tions
associations
415
524
489
446
419
423
416
0)
414
417
417
418
368
0)
97,000
173,564
181,214
188,300
206,414
225,748
232,058
0)
260,000
280,000
299,315
317,652
295,124
360,000
Total sales
Total net
surplus
M a rk k a a
M arkkaa
M a rk k a a
(i)
Q)
71,000,000
368,000,000
964,016,663
1,319,200,000
1,824,684.822
1,741,000,000
1,538,339,814
1,984,569,156
2,252,766,207
2,823,000,000
3.034,400,000
3,208,379,000
3,555,823,352
4,400,000,000
(i
(l)
(i)
v)
(1)
125,754,429
v)
v)
(l)
56,025,000
69,371,000
(0
0)
Own produc
tion
(i)
(n
(i)
(i)
(»)
(')
49,718,759
60,967,382
78,102,235
64,000,000
71,300,000
95,524,488
0)
Affiliates of K . K . (“ progressive” )
M a rk k a a
1918...................................................
1920...................................................
1925...................................................
1928...................................................
1930...................................................
1932...................................................
1935...................................................
1936...................................................
1937...................................................
1938___________________ ________
1939____________________________
1940____________________________
1942____________________________
1943____________________________
No data.
87
106
113
112
112
110
115
118
122
125
127
119
0)
0
95,216
143,896
198,845
225,537
241,732
248,551
265,169
275,000
282,600
306,673
323,100
317,758
358,279
363,267
146,856,915
525,846,302
1,063,670,676
1,358,200,000
1,247,984,233
1,064,808,177
1,335,493,881
1,503,000,000
1,860,000,000
2,103,253,477
2,256,900,000
0)
3,295,000,000
3,919,000,000
M arkkaa
6,178,818
10,456,999
18,931,377
31,600,000
0)
18,800,000
24,300,000
0)
46,000,000
(i)
V/
(1/
v)
«
M a rk k a a
(0
h
0)
0)
231,661,505
246,349,890
0)
0)
380,458,522
404,000,000
0)
oj
(0
126
Cooperatives in Individual Countries
COOPERATIVE IN SURANCE
Although the cooperative law of 1901 did not permit cooperative
associations to carry on insurance business, the cooperatives formed
separate insurance organizations which were operated on cooperative
principles. In the last years before the outbreak of World War II
the Finnish insurance organizations were suffering from a decline in
the interest rate and a consequent increase in premium rates. In
1936 the total value of new policies failed to reach the level of 1935 by
26 percent.
Attached to the neutral Y. O. L. cooperative group were the
following insurance organizations:
Cooperative Life Insurance Association, Pohja, founded 1923, with 84,683
members in 1937 and the amount insured totaling 1,232,121,000 markkaa. In
1936 Pohja’s investments amounted to 140,000,000 of which 51,000,000 markkaa
were in cooperative associations and their enterprises.
Fire, Motor Cars and Accidents Insurance Association, Vara, founded 1910,
with 631 member associations in 1937 and 28,013 persons insured against fire and
10,488 against accidents.
Staff Insurance Fund of Consumers* Cooperative Associations, Elonvara,
founded 1919, with 337 member associations in 1937 and 5,855 persons insured.
A recent law required that the employer be responsible for the first 200 markkaa
compensation paid for accidents. In 1936 Elonvara paid old-age pensions to 18
people, invalidity pensions to 27 persons, and sickness and maternity pensions to
98 persons. In the workers* sickness department pensions were paid to 246
persons.
Attached to the progressive K. K. cooperative group were the
following organizations:
Mutual Life Insurance Company, Kansa, founded 1923, with 262,945 members
in 1937 and the amount insured totaling 1,154,915,000 markkaa. Kansa issued
collective insurance policies through 53 cooperative associations in 1936. Burial
insurance policies were taken out for their members by 108 cooperative
associations.
Mutual Fire and Accidents Insurance Company, Kansa, founded 1919, with
104,576 persons insured in 1937 and the amount insured totaling 3,205,319,000
markkaa.
DEVELO PM EN T OF COOPERATIVE W H OLESALES
In the schism in 1916-17 which resulted in the formation of K. K.
and its affiliated wholesale, O. T. K., more than half of the local
associations retained their membership in the original wholesale,
S. O. K. In 1938, the year before the outbreak of the second World
War, the progressive wholesale had edged slightly ahead as regards
the combined membership of the affiliated associations. The neutral
wholesale still led as regards number of affiliates and total sales, but
O. T. K .’s business was growing at a faster rate than that of the
neutral organization (table 36).
Cooperative wholesale production.—Finnish central cooperative
organizations did not produce as extensively as those in some neigh
boring countries. In addition to the split in the cooperative move
ment already mentioned, other reasons for this were lack of capital,
the large amounts of production by retail cooperatives, and inexperi
ence in industrial life.
In 1928 when the value of O. T. K .’s production was 64.8 million
markkaa, that total formed only 8 percent of the wholesale’s turnover.
For the same year the value of S. O. K .’s production also amounted
to 8 percent of its turnover. By 1938 the proportion of own produc
tion to annual turnover had increased to some 20 percent for both
127
Finland
T a b le 36.— M em bership , and Operations o f Finnish Cooperative Wholesales* S. O. 1C
and O,
T. 1C, in Specified Years, 1905*43
[For par values of currency, see Appendix table, p. 278J
S. O. K. (“neutral” )
Year
Number Number
of associ of mem
ations
bers
1910
1915
1920......................
1925......................
1930......................
1933......................
1935......................
1936......................
1937.....................
1938.....................
1939.....................
1940.....................
1941.....................
1942.....................
1943......................
0)
(i)
341
500
0)
423
418
417
0
0)
417
0)
0)
0)
0)
(9
(i
0
(9
228,781
237,399
252,360
(9
(9
(9
(9
(9
<9
(9
300,000
Amount of sales
Amount of
capital
Net earnings
Own
production
M arkkaa
M arkkaa
M arkkaa
M arkkaa
1,004,025
13,610,079
35,098,522
323,699,443
700,548,578
1,008,586,919
914,571,571
1,101,210,376
1,211,799,821
1,520,074,340
1,562,819,150
1,646,000,000
1,649,555,434
1,754,564,000
1,770,000,000
2,153,000,000
127,400
1,146,300
3,856,800
19,579,200
53,003,024
120,672,917
156,717,512
176,053,489
188,429,710
199,877,836
215,911,228
(l)
(i)
(i)
(i)
(0
(i)
0)
1,456,781
4,337,573
10,561,768
17,227,619
0)
0)
27,134,000
35,037,000
to
(i)
(i)
(i)
0
>20,339,090
0
123,586,581
183,585,602
212,010,977
259,800,000
315,868,850
308,133,363
356,000,000
400,231,535
0
344,200,000
450,000,000
O. T . K . (“ progressive” )
1915
1920
1925
1930
1933.....................
1935......................
1936.....................
1937
1938.....................
1939.....................
1940.....................
1941.....................
1942........... ........
0)
110
112
112
109
0
(9
(9
0)
127
0
(9
(9
1No data.
(9
(9
(9
242,301
(9
(9
(9
(9
306,673
323,081
(9
(9
M arkkaa
»14,375,207
98,837,754
656,176,161
670,979,860
604,970,281
776,745,679
871,952,137
1,094,751,028
1,195,930,015
1,257,000,000
1,397,615,000
1,613,321,000
1,612,000,000
M arkkaa
8 3,450,750
8,819,750
40,783,000
91,858,044
117,309,675
138,435,875
150,459,875
165,757,500
182,625,750
201,300,000
0
0)
0)
8For year 1918.
M arkkaa
(i)
3,105,923
8,839,390
8,195,494
0
0
0
26,300,000
27,100,000
0
to
0
M arkkaa
82,035,578
103,917,420
155,000,000
228,853,923
243,300,000
0
0
239,600,000
8 For year 1921.
wholesales. The productive works of the two organizations in the
mid-1930’s were as follows:
S . 0 . K . — At Helsinki: Hosiery, chemical factories, chicory, coffee roasting,
bakeries. At Vaajakoski: Match, paper, margarine, preserving factories, saw
mill, brushworks. At Viborg: Biscuit and macaroni factories. At Jamsa:
Brickworks. At Oulu: Flour mill.
0 . T . K . — At Helsinki: Fertilizer, technochemical, margarine, underwear,
tailoring factories, coffee roasting. At Jaaski: Rye-flour mill. At Tampere:
Match factory. At Merikarvia: Herring pickling plant.
Cooperatives and the State
Though the Finnish cooperative movement could not exert unified
political pressure because of the schism in 1916-17, Finnish coopera
tive interests were close to every Finnish Government. In 1919 the
President of Finland was a former chairman of the board of directors
of Elanto of Helsinki, the largest consumers’ cooperative in Finland,
and his Minister of State was Elanto’s current chairman. At the
time of another crisis, the outbreak of World War II, cooperative
leaders were still serving in important Government capacities. The
Minister of Finance held the presidency of the International Coopera
tive Alliance; a recent prime minister had been a prominent coop
erator; and the head of S. O. K. and Y. O. L. had also been commercial
128
Cooperatives in Individual Countries
head of the State’ s Central Food Committee. Though the division
between the two consumer groups was not clear cut, as a rule it was the
“ progressive” group that was recognized by the State as representative
of the consumers’ general interests and its officials who were invited
to serve on customs and other committees.
Finnish Government favors to the cooperatives included actual
subsidies, especially in the field of agricultural cooperation. Rural
credit associations received funds for auditing and Hankkija received
them for seed experimentation. Subsidies were given for cooperative
education. In the early 1930’s S. O. K., the “ neutral” wholesale,
received about 79,365 markkaa annually for this purpose and Pellervo
about 436,508 markkaa. Government loans to the credit associations
were also made and the Government owned about 23,809,524 markkaa
of the share capital of the Central Bank in the mid-1930’s.
Legally, the position of the Finnish cooperatives rested upon the
Cooperative Law of 1901, as revised in 1918 and 1927, and the law
of 1895 relating to joint-stock companies. The cooperative law
forbade cooperatives to carry on insurance business and certain
forms of banking, it limited the member’s liability to the amount of
his share holdings, it provided special regulations for the admini
stration of loan business and for democratic administration, and on
the whole it allowed the associations great freedom of action.
Cooperative associations were obliged to pay taxes to the State,
the municipality, and the Church, though both State and munici
pality were known to grant reductions. Cooperatives designed to
supply their members with commodities or to promote members’
productive activities were required to pay income tax on only half
their net earnings (under certain lenient conditions). Regulations
such as these incited private traders to attack the cooperatives as
recipients of special privilege. In the autumn of 1935 it was reported
that a bill had been prepared by a special committee, for submission
to the Finnish Parliament, which would place the cooperative move
ment on the same basis as all other business. The fate of this meas
ure is not known.
Consum ers’ Cooperatives in W orld W ar I I
Less than 3 months after the outbreak of the war in September 1939,
hostilities began between Russia and Finland.
The Finnish consumers’ cooperatives entered the war with their
financial condition greatly strengthened, as has been indicated above.
Progress continued in 1939. Among the gains made by the K. K.
associations should be included 16,000 new members, 38 new stores
and cafes, and in total sales, the amount of 153,646,523 markkaa
which meant an 7.3-percent increase over the previous year. In 1939,
the membership in the Y. O. L. associations increased from 299,315 to
317,652, total trade to 3,208,379,000 markkaa, making a gain of 5.7
percent, and the number of retail units increased by 105 to a total of
3,612. Of the latter, 3,208 were ordinary stores, 215 small shops, and
189 cafes and restaurants. The wholesales also made appreciable
gains in business and resources.
The peace treaty was signed at Moscow on March 12, 1940. Under
the Protocol of April 29, 1940, Finland ceded about 14,000 of its 148,0Q0 square miles of territory to Russia and received into its reduced
Finland
129
area 450,000 inhabitants from the ceded lands. Since the ceded lands
lay in the southeastern section near and above Leningrad and since the
port of Viipuri was included, the cooperative movement suffered con
siderably. The losses to Russia in 1940 comprised about one-tenth of
the consumer movement— 8 associations with 32,000 members, 269
stores and restaurants, and 21 productive works representing an
annual turnover of 237 million markkaa, 450 distributive and produc
tive enterprises serving 43,000 members, whose purchases totaled 395
million markkaa annually, and the largest mill in the country (situated
at Viipuri), a bakery, meat cannery, a new rye mill (at Jaaski), an office
building, and warehouses. Though these properties were again under
Finnish administration in 1942, the value of S. O. K .’s productive
works decreased 21 percent as compared with the previous year and
that of O. T. K .’s by 17.4 percent.
In spite of these losses, the membership of associations affiliated to
Y. O. L. increased about 4 percent during 1940 and the aggregate trade
of all affiliates (amounting to 3,555,823,352 markkaa) showed a growth
of 10.8 percent. Business in the cafes and restaurants grew 43.5
percent over 1939 and own production of the affiliated associations 39
percent. The main problem was to obtain essential raw materials and
a continuous supply of commodities. By December 1940 the average
cost of living had increased 35 percent (over August 1938-July 1939)
and wages were rising very slowly. In 1941 the cost of living climbed
18 percent over 1940. Many adults could not afford sufficient food to
maintain health, and children were ill. The cooperative movement
requested the Government to control prices and stop speculative trad
ing. In midsummer 1941 the International Cooperative Alliance
reported the food situation was as bad in Finland as in Spain. The
cost of living continued to rise in 1942 and the sales tax was also
raised.
Finland joined Germany and went to war against Russia on June
26, 1941. Their troops reoccupied the ceded territory, which was rein
corporated into Finland by vote of the Finnish Parliament on Novem
ber 29, 1941. Since that time Finnisli cooperatives have continued
their successful operation. During 1942 Finnish dependence on
cooperatives was so great that approximately 720,000 families, repre
senting more than half of the total population, were organized into
consumers’ cooperatives. Because of a reduction in the volume of
foreign and domestic supplies, however, the volume (though not the
money value) of the total cooperative retail trade was less than in
1939.7
7 Sources .— The report on Finland is based upon data from the following publications: Suomen Tilastollinen Vuosikirja, Tilastollisen Pa&toimiston Julkaisema (Helsinki)*1932,1939,1940,1941; The Finland Year
book 1939-40 (Helsinki, 1939); Finland of 1940-41 (New York, 1940); Neutral Cooperative Movement in Fin
land; Its Tasks and Place in the Community (Helsinki, 1933); A Quarter of a Century of Cooperation in
Finland (Helsinki, Government Printing Office, 1024); Agricultural Cooperation in Finland (Helsinki,
Pellervo-Seura, 1936); Cooperation in Finland, by Hannes Gebhard (London, 1916); Cooperative Societies
Throughout the World—Numerical Data (International Labor Office, 1939); International Directory of
Cooperative Organizations (International Labor Office) 1933,1939; Cooperative Information (International
Labor Office). No. 12, 1932, No 8,1936, No. 9,1938, No. 5,1941; European Conference on Rural Life, 1939,
Cooperative Action in Rural Life (League of Nations Publications, 1939); International Cooperative Bulle
tin (International Cooperative Alliance, London), issues of July 1917, October 1918, June, July, and Novem
ber 1919, February, July, October-November 1920, January and February 1921, September 1922, March 1923;
Review of International Cooperation (International Cooperative Alliance, London), issues of March 1928,
February 1930, January 1934, January and July 1935, July 1937, March and July 1938, April, May. and June
1939, February, November-December 1940, June 1941, December 1942, February 1943;.People’s Yearbook
(English Cooperative Wholesale Society, Manchester, England), 1929,1932,1933,1934,1935,1936,1937,1938,
1939, 1940, 1941; Report of the Inquiry on Cooperative Enterprise in Europe in 1937 (Washington, 1937);
New International Yearbook (New York and London, 1943); New York Times (New York City), September
2,1936; and certain confidential sources.
130
Cooperatives in Individual Countries
Cooperative M ovement in Norway
Norwegian cooperative associations fall mainly into two large
groups— the consumers’ cooperative store associations, and the agri
cultural marketing associations, some of which also purchase farm
supplies for their members (table 37). There are also very small
numbers of housing associations and fishermen’s associations. The
combined membership of the various types of associations before the
war formed slightly over 20 percent of the population.
T
able
37.— M em bership and Business o f Cooperative Associations in N orw ay, b y T yp e
o f Association
[For par values of currency, see Appendix table, p. 278]
Type of association
All types.................................................................................................
Consumers’ cooperatives:
Federated in N . K . L.i
Independent 2
__
TTnnsing associations i . ..
. . .
.
Agricultural cooperatives: 2
General supply associations........................................... ..............
Marketing associations __
......
_1Tr_
Fishermen’s associations:4
Marketing associations
Purchasing assentations
..............
Number of
Number of
associa
members
tions
Amount of
business
K ro n er
3,895
584,579
666
424
10
196,234
00
1,600
210,020,700
00
504,050
1,763
1,026
63,870
318*423
17,135,000
122,400,000
4
2
150
4,302
60,000
21,215,900
371,335,650
i Data relate to 1941.
* Data relate to 1937.
* No data.
4 Data relate to 1934.
Consum ers9 Cooperatives
The first consumers’ cooperative association in Norway is believed
to have been started in Stavanger in 1864. The association was short
lived but served to introduce the cooperative idea. A little later
other associations were formed and by the end of the sixties had be
come fairly numerous. The economic crisis of 1880 wiped out most
of these associations and it was not until 10 years later that any
revival of cooperative interest took place. Most of this was attribut
able to the energy of Ole Delhi, a lawyer who had become acquainted
with the cooperative movement on a trip to England. Notwithstand
ing the physical difficulties of travel in the isolated and mountainous
districts of Norway, he traveled about, organizing associations, calling
meetings for exchange of experience, and finally, in 1906, organized
the Consumers’ Cooperative Union of Norway (Norges Kooperative
Landsjforening) known familiarly as “ N. K. L .” By 1907 this new
organization had 19 member associations with 6,300 members. In
that same year a cooperative wholesale department was formed in
the Union, to supply them with goods.
By the time of the outbreak of the first World War the Union had in
membership 149 associations with 32,000 members. Because of the
Government’s system of allotment of goods, based upon previous
consumption, the expanding N. K. L. suffered more than private
business and had to refuse admission to new associations. However,
during even this difficult period both N. K. L. and its member asso-
131
N orw ay
ciations continued to grow and the Union emerged from the war with
annual sales four times as large as those of 1914.
The post-war economic inflation and crisis was followed by a long
period of deflation and depression, ending in 1929. That year marked
also the first full year of the stabilized currency, and large increases
in sales and production were registered by both local associations and
the wholesale. However, this period of prosperity lasted only until
late in the summer of 1930, when falling prices, lowered business
activity, increased unemployment, and resultant decreased purchas
ing power began to be noticeable.
In 1931, a widespread labor dispute in Norway further reduced the
incomes and buying power of the worker cooperators, but a lockout
that paralyzed all the private tobacco factories for several months
resulted in more than doubled business for N. K. L.’s tobacco factory.
In spite of adverse circumstances the consumers’ cooperative
movement not only was able to hold its own but to show advances
from year to year throughout the depression. Each year in the period
1932-36 the sales of both retail and wholesale associations reached
new high levels, and an unusually sharp rise took place in 1937 when
economic recovery was reached throughout Norway.
In 1936 the members of the local associations affiliated to N. K. L.
were drawn from various occupational groups in the following pro
portions:
P e rc e n t
Wage earners in industry, handicrafts, fishing, merchant marine, trans
portation, etc________________________________________________________
Farmers_____________________________________________
Farm laborers and forestry workers_______________________________________
Independent craftsmen_________________________________________________
Salaried employees____________________________________________________
Self- employed, business and professional people__________________________
Total___________________________________________________________
49. 2
26. 3
6.2
3. 2
11. 6
3.5
100.0
The ultimate need of the movement— production of its own sup
plies— was recognized from the start. In 1911, at the end of N. K. L.’s
first 5 years of existence the first step in that direction was taken,
with the purchase of a margarine factory at Bergen. In the same
year the union purchased its headquarters building at Oslo and
opened a savings department, to receive deposits from members.
In 1921 an insurance association, “ Samvirke,” was started, to write
fire and other insurance (except life); and in 1930 a life-insurance
association was formed under the same name. In 1928 an auditing
service was undertaken, which according to report, resulted in “a
distinct improvement in the activity and economy” of the member
associations. Some time previously an architectural department was
started for the planning of the buildings of both the Union and the
local associations. In 1936, after a long contest, the Union finally
obtained Government permission to open a Cooperative Bank at
Oslo and did so in the same year.
By 1940 N. K. L. was operating three margarine factories, 3 coffeeroasting plants, and one factory each making tobacco products, soap,
shoes, flour, chocolate, woolen goods, and leather. Altogether,
about 40 percent of its annual business consisted of the sale of goods
made in its own productive departments. It had branch ware
houses in nine cities and, jointly with the Swedish Cooperative Whole
132
Cooperatives in Individual Countries
sale (K. F.), it operated an electric-light-bulb factory (a branch of
K. F .’s big factory, “ Luma” ).
T a b l e 38.— M em bership and Business o f Norwegian Cooperative W holesale Association,
N . K . L ,, and Affiliated Associations, 191 4 -4 1
fF or par values o f cu rrency, see A p p e n d ix table, p . 278]
Cooperative wholesale, N . K . L.
Number
of mem
ber asso
ciations
Their
members
1914...................................................
1919...................................................
1924...................................................
1929...................................................
1930...................................................
1931................................................1 9 3 2 -...............................................
1933...................................................
149
295
432
440
425
434
447
460
32,000
70,984
100,836
104,685
110,076
116,147
122,231
124.703
10,019,600
71,215,200
134.327,400
2 104,598,000
110,385,500
103.454,600
105,151,400
109,444,100
3,097,000
12,063,342
31.580,162
29,222,777
30,568,034
30,000,466
30,710,598
33,135,650
7,033,768
8,269,612
11,500,000
12.922,804
13,944,865
15,329,385
1934...................................................
1935...................................................
1936-.— ..........................................
1937...................................................
1938..............- ...................................
1939...................................................
1940...................................................
1941...................................................
479
497
549
585
585
608
630
666
130,245
138,557
148.748
160,107
169,175
181,050
189,403
196,234
117,391,400
129,769,600
145,108,400
3 168,250,000
183,330,500
195,819,000
4 218,400,000
210,020,700
36,297,100
41,393,*675
46,520,538
54,105,406
56,619,229
62,600,000
59,443,000
53,162,000
15,850,000
19,652,143
0)
24,000,000
0)
24,400,000
0)
(0
Year
Their sales
K ro n er
Sales
Value of
manufactures
K ro n er
K ro n er
0)
* N o data.
* N e t earnings, 5,664,500 kroner; patronage refunds, 2,976,500 kroner.
* N e t earnings, 8,500,000 kroner; patronage refunds, 5,000,000 kroner.
4 N e t earnings, 10,428,000 k roner; patronage refunds, 4,900,000 kroner.
In 1939 N. K. L. and the Agricultural Cooperative Wholesale
Society (N. N. F.) signed an agreement designed to prevent over
lapping and competition between the two organizations. Under the
agreement N. K. L. agreed to discontinue handling certain farm sup
plies and to obtain from N. N. F. any of these needed by its affiliates.
Cooperatives and the State
The Norwegian commercial law forbids the opening of branches
in another community than that in which the parent organization
is situated. The consumers’ cooperative movement therefore has
never had to compete with that concentration of private business known
as the chain store. This restriction on branches, of course, applies to
the cooperative movement as well and has prevented the development
of large associations covering a whole district, such for instance as were
found in France (the “ development” societies). However, Norwegian
cooperative associations did have the privilege of establishing branches
within the home community.
Except for a short time, under a law passed in 1933, cooperative
associations paid no income tax on their business with members, any
margin being recognized as simply an overcharge rather than a
“ profit” as in private business. They were, however, taxed on the
net margin resulting from their trade with nonmembers.
During the early years of the consumers’ cooperative movement
some Government credit was extended to it, but as the movement
grew it became self-sufficient. Agricultural cooperatives have also
received some Government loans.
N orw ay
133
Although the cooperators are of many shades of political opinion,
the consumers’ cooperative movement itself has always maintained
strict political neutrality.
Cooperatives and the W ar
With the outbreak of the present war a wave of buying sent sales
in the consumers’ cooperatives soaring.
For months before the actual invasion of Norway the indiscriminate
destruction of Norwegian shipping had somewhat dislocated trade
and made difficult the obtaining of supplies from abroad. N. K. L.,
however, had been foresighted and had been carrying up to 5 times
its usual inventories.
When war broke out, N. K. L. pointed out to its member associa
tions that the cooperatives were capable of exerting a decisive in
fluence on the price level. In 1940 their membership constituted
about 6.7 percent of the population of Norway. Taking into account
their families, the consumers’ cooperative movement was serving
nearly 27 percent of the population at that time. The importance of
the movement was recognized by the Government which from the
outset of the war gave it representation on both local and national
price-control committees for the various branches of trade.
When Norway was invaded, in April 1940, the cooperative ware
houses in the harbor of Narvik were destroyed and N. K. L.’s mar
garine factory there was damaged. Other associations in the zone of
hostilities also suffered damage.
The physical configuration of the country has been both an asset
and a disadvantage to the cooperative movement. The cooperative
associations are scattered throughout Norway, from the Polar Sea to
the extreme south.
In peacetime the difficulties of communication and transport through
the mountains to isolated sections hampered to some extent the spread
of the movement. These difficulties, however, were also responsible
for the fact that the local associations undertook, to a degree unusual
in the consumers’ cooperative movement, the production of some
of their necessaries— notably perishables, such as bakery and meat
products. The productive departments of these local enterprises also
included manufacture of cheese and margarine, coffee roasting, tanning
of leather, laundering, and even tailoring and dressmaking establish
ments. In 1938 the local associations were operating over 200 pro
ductive plants of various kinds. Although the expansion of N. K. L .’s
productive facilities was limited to the extent that the local facilities
were developed, this fact became an advantage under wartime con
ditions. When Norway was invaded and whole regions were cut off
from communication with the rest of the country, the local associa
tions were still able to obtain supplies from their own bakeries and
factories.
Notwithstanding all the wartime obstacles, both the wholesale and
retail branches of the movement increased their membership in 1941,
though both showed some decline in money volume of sales. Re
peated efforts by the Germans to take actual control of the movement,
while ostensibly leaving it in the hands of the cooperators, were firmly
resisted by the cooperative officials. Specifically the Germans de
manded that N. K. L.’s board of directors vote to allow the Nasjonal
134
Cooperatives in Individual Countries
Samling (the Norwegian Nazi Party) to appoint two “ controlling
representatives” on the board. Finally, in the summer of 1942 the
Germans arrested and sent to a concentration camp the president and
the secretary of N. K. L. They were later released “ under surveil
lance,” but on August 10,1942, the offices and warehouses of N. K. L.
were closed by the Germans, who seized the entire stock of goods.
No later data are available. However, despite the fact that the
National Union of Consumers’ Cooperatives is thus prevented from
further commercial activity, it is regarded as probable that the local
(retail) associations continue to operate in most parts of Norway.8
Cooperative Movement in Sweden
The Swedish cooperative movement was largely practical and eco
nomic, its foremost aim being to provide foodstuffs and other neces
saries for its members in the best and cheapest way. In 1941, how
ever, nearly 2 years after the outbreak of World War II, Swedish co
operative policy stressed the Swedish conception of life, its essential
democracy, and its dependence upon the “ responsible and spiritually
fully developed person.”
Swedish cooperatives developed simultaneously with Sweden’s
industrialization, with increase in agricultural products for sale, and
the advent of a modern banking system and large-scale enterprise.
In the mid-1930’s the consumers’ distributive movement was reported
to be “ the only large-scale organization in the distributive trade in
Sweden.” The average yearly business per cooperative association
was over 9 times as large as that of private retailers. More than a
third of Sweden’s population was served by consumers’ cooperatives in
1943, and these associations accounted for about 12 percent of the total
retail trade and about 20 percent of the retail business in food.
Swedish cooperatives were outstanding for their use of production to
break up monopoly control of important articles of general consump
tion, and thus lower prices. American observers sent abroad in 1937
to study cooperatives in Europe reported that this policy had “ con
tributed materially to the building of a sound national economy,”
enlarging purchasing power and increasing business and employment,
especially among low-income groups.
Although Swedish cooperatives were strongly federated, they also
emphasized effective local autonomy and democratic control. At the
fortieth congress of the Swedish cooperative federation, Kooperativa
Forbundet (“ K. F .” ) in 1939, the Swedish Prime Minister congrat
ulated the cooperatives upon being able to “ foster democracy along
with progress, in a sphere in which people were least inclmed to
recognize that democracy would work.” *
* S ou rces.— T h e report on Norway is based upon data from the following publications: Statistisk Arboks
for Norge, 1936,1937,1938, and 1940 (Statistiske Ccntralbyr&, Oslo); Sociale Meddelelscr, No. 8,1923 (Norway
Departmentet for sociale saker); Kooperat0ren (Oslo), July 1922, August 1923, January 1924, and January
1926; Kooperatbren (Stockholm), September 1921 and January 1922; Konsumentbladet (Stockholm), July
1925; Cooperative Review (Manchester, England), February 1939; Review of International Cooperation
(International Cooperative Alliance, London), November-December 1921, September 1925, August 1926,
January and February 1937, July 1938, April 1940, January and February 1941, and December 1942; People’s
Yearbooks (English and Scottish Cooperative Wholesales) for 1933, 1934,1937, 1938, and 1941; Cooperative
Information (International Labor Office), Nos. 33 and 38, 1926, No. 4,1929, Nos. 2 and 7,1930, No. 5,1931,
Nos. 3 and 5, 1932, No. 3, 1933, No. 1, 1938, No. 6, 1941, Nos. 7 and 9, 1942, and No. 1, 1943; International
Directory of Cooperative Organizations (International Labor Office), 1939; Cooperative Societies Through
out the World—Numerical Data (International Labor Office), 1939; Consular Report, Stavanger, Septem
ber 8, 1928; Report of President's Cooperative Inquiry Commission, 1937 (Washington, 1937); CoopwAtive
Consumer, June 1, 1942; and Cooperative League News Service, April 16 and October 8,1942.
135
Sweden
Farmers' cooperatives were equally well developed, and almost
without exception Swedish farmers were members of marketing and
other cooperatives. Cooperative dairies marketed 80 percent of the
nation's total milk output, 86 percent of the butter, and 50 percent of
the cheese output. Cooperatives also handled 30 percent of the eggs.
Fertilizer, machinery, and various farm supplies were purchased
through cooperative organizations.
Coordination between the consumers' and farmers' cooperatives, to
prevent overlapping of functions, was accomplished through the Joint
Committee of Cooperative Organization established in 1936.
T ypes o f Cooperatives and Their Activities
Cooperatives in Sweden have undertaken a wide diversity of activi
ties. The distributive cooperatives were concentrated largely on food
distribution, other consumer activities being generally undertaken by
specialized associations. Some operated cafes and restaurants, others
carried on housing activities, and still others had as their function the
distribution of electricity. Insurance against death, fire, accident, etc.,
was provided through two central associations. The agricultural
cooperatives were equally varied. Sweden was also one of the countries
in which longshoremen were organized cooperatively.
T a b l e 39.— Num ber o f Cooperatives in Sweden, b y T yp e , 1916 , 1926 , and 1936
1916
Type of association
All types-----------------------------
1926
7,264 12,605
ConSt1TnArs>association s
4,344
Distributive___________ 1,324
62
Restaurants and cafes—
Housing_______________
660
Other building................. 1,921
Electricity distributives.
117
Central unions.................
2
Miscellaneous..................
358
Agricultural associations:
S u p p ly p u rch asin g
1,327
Machine purchasing___
139
Peat
_ ___
___
59
DAiry
621
Slaughterhouses________
30
1936
20,411
8,566
1,583
78
1,511
2,823
1,570
24
977
14,484
1,438
84
2,979
3,805
1,887
30
4,261
1,551
297
90
699
38
1,662
422
83
862
64
Type of association
Agricultural associations—
Continued.
E g g m a rk e tin g
C a ttle bread in g _
__
_
Distillery..........................
C e n tra l unions_ _
Miscellaneous_________
Workers’ productive and
labor associations:
Workers’ productive___
Longshoremen’s_______
P r in tin g
1916
1926
67
143
91
35
156
102
327
94
38
244
263
534
112
54
520
75
19
30
163
28
79
197
38
108
48
80
105
184
191
817
1936
Credit associations:
U rb a n __
R u r a l . __
_____
_
_
COOPERATIVE CREDIT ASSOCIATIONS
The greatest development of cooperative credit in Sweden has dated
from 1930 when the Swedish Federation of Cooperative Kural Credit
Banks (Svenska Jordbrukskreditkassan) was formed as part of a
reorganization of the rural credit system. Between that year and
1936 the number of rural credit cooperatives rose from 187 to 789.
Data for the rural credit cooperatives are shown in table 40; similar
data for the urban cooperatives are not available.
136
Cooperatives in Individual Countries
T a b l e 40 . — M em bership , Loans, and Capital o f Rural Credit Cooperatives in Sweden,
in Specified Years, 1916-41
[F or par values o f currency, see A p pe n d ix table, p . 278]
Number
of associa Member
ship
tions
Year
1916...................................................
1920..................................................
1925...................................................
1930...................................................
1934..................................................
1935...................................................
57
120
137
187
699
771
1,654
4,187
7,643
14,081
59,267
73,071
1936...................................................
1937....................................................
1939...................................................
1940....................................................
1941....................................................
789
785
84,148
<*)
0)
0)
8
108,700
111, 100
Loans
Deposits
Own capital
K ron or
K ronor
K ron or
100,000
3,700,000
8,800,000
15,300,000
43, 500,000
56,800,000
2,000,000
3,600,000
7,400,000
17,900,000
23,000,000
(l)
(l)
(9
72,600,000
88,800,000
120,300,000
115,100,000
114, 200,000
31,900,000
0)
0)
(0
0)
8
0)
2,800,000
3,700,000
4,400,000
6,300,000
7,100,000
7,300,000
* No data.
E liE C TR IC ITY COOPERATIVES
As Sweden lacks coal resources, its electrification program has been
based upon utilization of its abundant waterpower. In 1909 the
Swedish Government created the Waterpower Administration, under
the Royal Board of Waterfalls. Under the system thus created,
rates were severely competitive, and the State intervened only when
necessary to protect the consumer from exorbitant rates or poor
service; by generating power and selling it wholesale to cities, towns,
and cooperatives, the State became an effective competitor, able to
push rates down.
By 1937, about 65 percent of all Swedish farms had been electrified.
Approximately one-half of the rural distributive facilities were owned
cooperatively, and the State supplied power to one-third of the rural
electrification systems.
Cooperatives were encouraged and assisted by the Government
Waterpower Administration. It drew up the cooperatives’ bylaws,
designed their distribution systems, inspected their lines, provided
account books, and helped to audit their accounts.
COOPERATIVE HOUSING
Though some Swedish cooperative housing associations were
organized in Stockholm and Goteborg when industrialization devel
oped in the last half of the nineteenth century, and 100 such associa
tions were registered by 1897, the period of growth which has given
Sweden distinction in cooperative housing began in World War I.
Wild speculation in real estate and a great increase in rents in 1917
caused the organization of tenants’ unions, which combined in a
national association in 1922. The Stockholm associations completed
their first construction in 1919 with money raised by lottery.
The Stockholm Tenants’ Saving and Building Society was organized
in 1923. About 65 percent of the association’s members consisted
of manual workers and their families; the remainder were office
employees and people engaged in private enterprises.
In 1926 the various local housing associations federated into the
National Federation of Tenants’ Savings Banks and Housing Societies
(H yresgdsternas
Sparkasse- och
Byggnadsjdreningars
R w sforbund,
137
Sweden
known as “ H. S. B .” ). By 1939 this federation had 69 affiliated
associations with 18,500 members.
The national union’s annual building program, measured by the
number of units built and the value of its real estate, is indicated by
the figures below. By 1937, cooperative dwellings constituted about
10 percent of all housing in Sweden. H. S. B. alone had constructed
buildings containing about 17,000 dwelling units and valued at 212,
000,000 Swedish kronor (130,000,000 kronor represented buildings in
Stockholm). As each building was completed, it was turned over to
a local association formed among the occupants for the express purpose
of managing the apartment house, collecting rents, etc.
N u m b e r of
dwelling units
constructed
Real-estate
value (in
kronor)
149
1924......... ............................................................
1925. ________ . . . _______ ________________
519
1,155
1926. .................
1927........................
1,237
1928.......................
923
1929................................
1,238
1, 782, 900
6,754,000
15,043,585
16,475,000
10,618,000
15,326,000
1930......... ...........................................................
1 9 3 1 .. ____ __________________ ___________
1932_______ _____ ______________ _____ _____
1 9 3 3 .. ............ ..................................................
1 9 3 4 .. ___________________ _____ _________
1935______________________________________
14,460,600
16,244,800
20,644,200
13,006,000
11, 117, 000
19, 188, 000
1,002
1,207
1,512
1,010
951
1, 591
Construction was usually financed through bank credit (up to 60
percent of costs), through H. S. B. Savings Bank credit (up to 90 and
95 percent of costs), and by deposits of the associations’ members.
Little State or municipal credit was used by housing cooperatives.
The housing provided fell generally into four types differing in
style, financing, and nature of ultimate ownership and management.
All four types had good technical equipment and design, sunny sites,
and convenient lay-out. The best-class group included the majority
of modem city apartments, each unit varying in size from one to five
rooms. In these, the membership contribution amounted to 10 per
cent of the total value of the apartment—a sum usually varying with
the size of the apartment from $190 to $1,180. Houses of the second
type were built less expensively on less valuable lands and consisted
of smaller groups of rooms. The advance membership contribution
in the second group was 5 percent of the total value—from $80 to $400.
The other two types were not managed cooperatively by the re
sidents. Those of the third type consisted of houses constructed in
Stockholm by private contractors with municipal aid. They were
taken over by H. S. B. and were managed by foundations created for
the purpose. No membership deposits were required but occupants
could be admitted only after consultation with the city authority re
garding economic status. In the 1930’s the Riksdag made a generous
appropriation for aiding this type of housing. The fourth type of
housing, being intended only for large families, was financed partially
by municipalities, with the State contributing 30 to 50 percent of the
rent according to the size of the family.
The Federation, H. S. B., had its own city-planning division, its own
architects, its own purchasing department, and its own factories.
588544°— 44------10
138
Cooperatives in Individual Countries
It advised the member associations in construction of the buildings,
operated a savings bank, and aided in financing. In order to provide
materials for construction at reasonable costs, H. S. B. purchased a
factory for making parquet flooring, and plants for mixing mortar
and stucco finish, for making shutters, trusses and girders, washing
powders and cleaning and polishing materials, and an extensive plant
for constructing houses for export. In addition to these enter
prises, H. S. B. developed a summer vacation colony at Arsta, a sys
tem of house insurance in cooperation with Folket, and nurseries and
playgrounds in some of the apartment-house developments.
By their operations, the Swedish cooperative housing projects es
tablished higher standards in building designs and equipment and
reduced the price of housing. The result was the stimulation of
private agencies in a way beneficial to all Sweden.
COOPERATIVE INSURANCE
Swedish cooperatives entered the field of fire insurance in 1908, in
order to forestall the formation of a private syndicate to regulate fire
insurance premiums; they entered the field of life insurance in 1914
because of the bad state of working-class insurance. In both cases,
K. F. subscribed the guaranteed capital. The fire-insurance associa
tion, Samarbete, eventually added accident, automobile, burglary,
and liability insurance. The two insurance associations operated with
the same management, under the supervision of K. F.’s administrative
council, and the president of the insurance associations was a member
of the board of directors of K. F.
T a b l e 4 1 .— Growth o f Cooperative Insurance Associations in Sweden, 1908—42
[For par values of currency, see Appendix table, p. 278]
Samarbete
Folket
Year
Number Premium
of policies income
ion* _ _
.
.
_
1914..........................................................
1930..........................................................
1934........................................... .............
1935..........................................................
1938..........................................................
1942..........................................................
K ro n o r
6,238
0)
(0
0)
266,985
0)
0)
34,012
0)
5,710,000
6,600,000
6,597,178
10.350.000
12.570.000
Surplus
Number Premium
of policies
income
K ron or
(i)
0)
847,016
1,124,495
0)
1,439,389
0)
K ro n o r
li, 141
0)
0)
206,373
0)
258,000
310,611
6,460,000
8,140,000
8,831,012
10,470,000
12,350,000
Surplus
K ro n o r
0)
944,660
830,156
0)
168,425
0)
i No data.
B y 1938 the life-insurance association, Folket, held the ninth place
among 16 Swedish companies with regard to premium income.
Samarbete occupied fifth position in fire insurance, fourth in automobile
insurance, and first place in collective accident insurance. By that
time, the two associations had about 473,000 policyholders.
Early in the century, the insurance cooperatives loaned much of
their funds to the consumers* cooperatives. After the latter built up
large funds of their own, both Folket and Samarbete invested more
and more money in housing enterprises; in 1938 they had 60,848,000
kronor thus invested.
139
Sweden
Development o f Consumers’ Cooperatives
Impulse for the development of Swedish consumers' cooperatives
came early, from the example of the Rochdale Pioneers in England,
but the movement was not particularly successful at first. Added
impetus was given with the formation of the Cooperative Union and
Wholesale, K. F., in 1899. The practices of open membership and
the payment of patronage refunds to nonmembers, credited toward
purchase of the membership shares, did much to expand the movement.
By the outbreak of the first World War, more than 100,000 persons
were members of Swedish consumers' cooperatives.
The movement early adopted practices looking toward increasing
the financial stability of the associations. Among these were cash
trading, financing the movement through the medium of savings
departments in the local associations, a systematic policy of concentra
tion through mergers of small local associations, and specialization in
foodstuffs.
Until the formation of the great Stockholm cooperative, K. F. S.,
in 1916, Stockholm had 16 cooperatives, only two being of particular
strength. Between 1916 and 1926, K. F. S. became a powerful co
operative, increasing its membership from 4,461 to 34,799. By 1939
this association was operating 453 stores.
In 1923 the 1,174 Swedish cooperatives operated a total of about
2,000 stores. By 1935 the number of associations had been reduced to
about 850 and stores had risen to some 4,000. By 1939 the correspond
ing numbers were 807 and 5,363, and in i940 they were 787 and 5,472.
Less than a fourth of the associations operated only one store. After
the outbreak of World War II, local consumer associations increased
their members at a pace equaled only in 1916 and in 1932. Member
ship reached 765,700 by the end of 1942. More than 72 percent of the
associations registered in 1941 had at least 1,000 members. During
the same year 130 new stores were opened.
During the decade of the 1930’s, Swedish cooperatives were serving
about a third of all Swedish families. They were doing about 10 to
12 percent of the nation's total retail trade and 15 to 20 percent of the
total trade in foods and provisions. An official survey of Swedish
retail trade reported in 1937 gave the following proportions of business
done by the various retailers:
P ercent
In d iv id u a l retailers______________________ 83. 3
D ep a rtm en t stores_______: _____________
2. 4
Chain stores____________________________
1. 4
M a il-ord er h ouses______________________
. 9
O ne-price stores------------------------------------1. 0
C oop era tiv e stores_______________________ 11. 0
The yearly turnover of the individual retail cooperative far exceeded
that of the private retail establishments, the average for the latter
being 51,000 kronor in 1930, when the average for the cooperatives
was 470,000 kronor.
A comparison of prices made by the Swedish Government indicated
that cooperative prices were 5 percent lower than private retail prices
“ leaving out of account the dividend refund given by cooperatives.”
This difference prevailed before 1939 and increased to the advantage
of the cooperatives during the early part of World War II.
140
Cooperatives in Individual Countries
With the exception of a slump in sales in 1925, consumers’ cooper
atives’ sales mounted steadily until the outbreak of World War II
(table 42). In spite of the trade restrictions caused by rationing and
shortages of goods, sales even then continued to increase, approaching
a value of 700,000,000 kronor in 1940 and exceeding it in 1941. In
1942 the volume of trade reached 731,000,000 kronor; rising costs of
operation had decreased net surplus somewhat, but the average divi
dend was 3.6 percent; share capital increased 4,000,000 kronor, and
members’ savings 3,000,000 kronor.
T a b l e 42 .— Growth o f Swedish Consumers* Cooperative Enterprises, in Membership,
Sales, Capital, and Earnings, 1 9 1 0 -4 2 1
[For par values of currency, see Appendix table, p. 278]
Year
Num
ber of
Num
associ Mem ber of
ations bership
stores
report
ing
Amount of
business
Net
earnings
Patronage
refunds
Share
capital
Interest
paid on
share
capital
Reserves
K ro n o r
K ro n o r
K ro n o r
1910....
542
1915....
770
1920.... 1,016
1925....
921
1930....
789
K ro n o r
K ro n o r
K ro n o r
85,358
121,643
240,467
316,490
420,004
645
983
1,700
2,220
3,058
28,709,648
59,959,149
264,545,408
259,106,379
319,736,196
2,325,331
8,003,479
11,277,629
15,817,135
2,179,231
7,587,093
7,835,006
11,234,052
1,733,812
3,672,986
13,969,140
21,421,489
32, 546, 596
137,066
545,388
1,032,559
1,611,035
539,207
279,551
4,425,666
1,590,272
2,203,852
1933....
1934....
1935....
1936....
1937___
693
686
674
680
717
482,112
497,986
513,564
548,384
605,010
3,507
3,610
3,753
4,041
4,524
321,259,017
342,887,638
376, 224,464
413, 219,414
484,148,081
15,448, 426
16,579,174
17,772,468
19,311,851
21,872,310
11,022,098
11,951,407
12,737,883
14,106,986
16,075,800
37,744,032
39,525, 761
41,171,328
44, 264,828
48,896,097
1,869,102
1,968,314
2,039,879
2,134,313
2,328,559
2,091, 502
2,321,425
2, 509,876
2,698,824
3,027,374
1938___
1939___
1940....
1941___
1942___
736
738
711
682
676
645,160
682,521
700,000
736,508
765, 700
4,886
5,218
5,301
5,431
5,620
538,453,584
596,677,296
673,200,000
720,800,000
731,000,000
23,873,968
25,110,876
(3)
26,960,000
26,380,000
17, 248,521
18,609,823
(3)
52,595,798
55, 527,946
58, 230,000
(3)
(3)
2,428,295
2,466,578
00
(3)
(3)
3,429,964
3,633,998
(3)
(3
3)
(?)
0)
i Data do not include cooperatives in Friesland which numbered 62, with sales of 13,648,654 kronor, in 1939.
3 No data.
The retail associations were substantial producers of goods—
notably “ soft bread” and meat products. In the 15-year period from
1924 to 1939, the volume of production by these local associations
rose from 13,792,348 to 58,564,802 kronor.
That the membership of the Swedish cooperatives has been drawn
from all classes of the population is indicated by the distribution
given below. As it shows, industrial workers and farmers consti
tuted the largest groups of cooperators.
Percentage distribution o f m em bers
19SS
19S9
ms
In dustrial w ork ers----------------------------------------------------------- 29. 2
F arm w ork ers___________________________________________
4. 7
C raft w ork ers___________________________________________
5. 1
O ther w ork ers___________________________________________
20. 2
E m p loy ees (clerks, low er ranks o f p u b lic em ployees)
9. 1
F arm ers_________________________________________________
15. 0
C raftsm en (sm all w ork sh op m a sters)__________________
3. 1
P u b lic officials___________________________________________
2. 6
C o rp o ra tio n s -____ , _____________________________________
.9
Sm all trad esm en ________________________________________ _______
P rofessional m e n ________________________________________ _______
M iscella n eou s____________________
10. 1
Total
100. 0
28. 2
4. 2
6. 8
15. 0
9. 3
14. 5
2. 3
2. 5
.9
4. 2
2. 5
10. 6
2 6 .7
3. 9
6 .3
15. 9
9 .2
1 4 .0
100.0
100. 0
2. 1
2.6
.8
4 .9
1 .7
1 1 .9
141
Sweden
Cooperative Union and Wholesale, Kooperativa Forbundet
The Swedish cooperative Union and Wholesale Society, K. F.,
began its existence in 1899 as an information and propaganda center.
It became a central buying agency in 1904. Boycotts of this new
enterprise, which were organized by retailers early in the twentieth
century, led K. F. to start independent purchasing, production, and
the banking of savings deposits. Some of the early ambitions for
K. F. were abandoned—for instance, that of serving as a center not
only for consumers’ cooperatives but also for other branches of the
movement. In 1939, K. F. had as affiliates only the consumers’
associations and certain insurance organizations.
K .
F .’ S COMMERCIAL ACTIVITIES
In 1930 the average turnover of Sweden’s 10,000 wholesale trading
enterprises was a little less than 500,000 kronor each. For the same
year, K. F .’s wholesale turnover was almost 144,000,000 kronor. The
figures on K. F .’s wholesaling, given below, show its growth between
1929 and 1941 and indicate the accelerated expansion in the year of
the outbreak of World War II.
K ro n o r
K ro n o r
1929.
1930.
1931.
1932.
1933.
141,
143,
148,
149,
152,
320,
618,
036,
454,
483,
000
000
000
000
000
1934.
1935.
1936.
1937.
1938.
165,
177,
192,
217,
229,
115,
656,
778,
213,
855,
K ro n o r
000 1939.
000 1940.
000 1941.
000
000
269, 350, 000
279, 070, 000
270, 930, 000
Retail trade.— K. F. developed retail trade on a large scale. Skocentral, a subsidiary, had more than 30 shoe stores in 1938. These
served as exhibit centers for both wholesaling and retailing and for
sampling public demand. In 1935, K. F. bought a controlling inter
est in the large Stockholm department store founded by Paul U.
Bergstrom and known as P. U. B. During the first and second years
of World War II, this store—then the largest owned by cooperatives
in Stockholm— increased business 19.8 percent, its sales totaling
27.600.000 kronor in 1940. In 1941, P. U. B .’s sales reached
28.930.000 kronor, an enormous expansion over the 9,450,000
kronor of trade in 1935, the last year under private management.
Production.— K. F. carried on a successful program oi production
of which the expansion has been in quantity rather than in variety of
goods, as may be seen from table 43. Cardinal principles in this
program were (1) concentration on one objective at a time, (2) sound
and independent financing, and (3) large-scale production of goods for
the use of members, but only when necessary to influence the price and
quality of goods. This policy apparently satisfied various interests,
for Government officials and industrialists stated to American in
quirers in the mid-1930’s that the cooperative movement’s check on
monopoly prices had made it unnecessary for the Government to
develop anti-monopoly legislation.
K. F .’s production began after a margarine cartel, which had fixed
prices, attempted to boycott cooperatives in 1909. This new cooper
ative margarine enterprise played so important a part in national
economy that K. F. added soap manufacturing in 1910. On March
29, 1922, the cartel composed of the seven largest margarine manu
facturers suddenly ceased the joint issuance of price quotations, an
142
Cooperatives in Individual Countries
event declared to be of “ tremendous significance” to the cooperatives.
Between 1924 and 1938 the cooperative factory's production doubled.
K. F. bought a vegetable oil plant in 1932. Up to 1940, K. F. supplied
more than one-quarter of Sweden's margarine and was reported the
same year to have the largest storage plant for edible oil products in
Europe. Government regulations forbidding the home consumption
of margarine went into effect May 26, 1940, and lack of raw materials
caused the closing of the factory from May to October 1940.
K. F. began flour milling because a private flour-mill organization
gained control of flour prices after the State ceased regulation of the
grain market in 1920. In 1922, K. F. bought the Tre Kronor (Three
Crowns) flour mill on the isle of Kvarnholmen in Stockholm harbor
and later acquired the island itself with its good dock facilities. The
Swedish Millers' Ring which then controlled 90 percent of the flour
(produced in Sweden yielded for the first time in its history, and
owered prices on March 18, 1925.
In 1925-26 and 1928, price conditions caused K. F. to start the pro
duction of superphosphate fertilizer and of rubber shoes and galoshes.
In accordance with its policy, K. F. began to produce, in the 1930's,
cash registers, crisp bread, porcelain, and artificial silk, each filling
some special local need. After pursuing for years a policy of entering
those industries in which cartel combinations had resulted in the
exploitation of consumers, K. F. was eventually able to win certain
price reductions by threat alone. Thus, a threat to enter the linoleum
industry brought an offer from the trust to lower prices 15 percent,
and an agreement to that effect was reported in 1940.
The most unusual industrial enterprise undertaken by the Coopera
tive Union was the electrie-light-bulb factory, Luma, which was built
in order to break the monopoly of an international electric-bulb
cartel. In 1931 the enterprise was taken over by an international
cooperative organization (Kooperativa Lumaforbundet), which included
the cooperative wholesales of Sweden, Denmark, Norway, and Fin
land. Prices set by the international cartel dropped 40 percent after
the opening of the Luma plant.
T
able
4 3 .— Value o f Goods Produced by Cooperative Union and Wholesale Society, K . F .9
1 9 2 4 -3 9
[For par values of currency, see Appendix table, p. 278]
Product manufactured
1924 *
K ron or
1934
1935
1936
1939
24,440,457
K ron or
K ro n o r
K ro n o r
80,471,748
89,891,184
120,859,531
144,535,346
_ _ __ 11,924,395
Flnnr
.
__ ____
9,074,126
Margarine_________________ _____________
520,960
Chemical technical supplies___ _________
Rubber galoshes_________________________
Shoes_______ _____ ______________________
Pottery and porcelain___________________
Crisp bread_____________________________
Cement_____ ____ ____ _________________
Vegetable oil____________________________
Cash registers___________________________
Artificial silk
_ _
_
Coffee (roasting)
Other production______ _________________
2,920,976
26,130,548
15,384, 787
878,902
10,082,217
2,266,381
29,136,643
15,853,011
930,458
11,571,586
2,703,684
30,673,291
15,564,307
1,453,260
12,667,729
3,501,186
All products
_ _
2,407,920
161,000
22,432,596
727,397
K ro n o r
2,579,843
3,015,130
34,206,002
20,493,471
2,153,055
11,095,896
3,436,695
3,199,365
3,952,160
25,453,732
1,481,487
180,740
35,695,340
1,546,631
36,932,984
2,148,461
14,692,391
2,650,266
17,642,104
9,275,153
Exports— After K. F. had acquired experience in purchasing on the
world market in connection with various productive undertakings
already mentioned, it circularized the owners of small enterprises and
handicraftsmen to suggest the formation of a special export organiza-
Stoeden
143
tion. As an inducement K. F. offered to guarantee a capital of 500,000
kronor. The desired export association, Produkter fran Sverige
(Products from Sweden), took form in 1935.
OTHER K . F. ACTIVITIES
In order to improve cooperative building standards, the architect’s
office of the Cooperative Union and Wholesale Society was established
in 1924. By 1935 this office had a chief and 10 architects and a civil
engineer with assistants. Affiliated associations were not required to
use the services of these specialists, but many did so.
Systematic consumer cooperative auditing began with the appoint
ment of a consulting auditor in 1917. By 1932 Swedish consumers’
cooperatives had developed 18 auditing districts, each with a district
committee and district auditor, and all affiliated to the central union’s
joint auditing system and subject to its supervision. Though par
ticipation in the auditing system was at first voluntary, about 1932
membership in the auditing department became obligatory for all
affiliated associations.
In 1922, K. F. participated in the organization of an association,
known as S. H. F., to assist and manage associations in financial
difficulties.
Cooperatives in W orld W ar I I
The first years of World War II caused no change in the internal
structure and organization of the cooperatives. They, like all private
economic organizations, were still controlled by a 1911 law, and
regulations for wartime rationing and control were applied on a
commodity basis to cooperatives and private business alike.
The private traders’ movement for the organization of all trade and
occupations into corporations, which began throughout Europe in the
1920’s, increased greatly in vigor in Sweden after the outbreak of
World War II. Though K. F. had already been compelled to join
private traders’ organizations for fodder stuffs, fresh fruits, cereals,
and fats, in 1939-40 the cooperatives repeated their declaration that
they could serve the consumer best by creating competition between
the large-scale “ cartelized” and the cooperative enterprises. They
therefore opposed all private traders’ plans for corporative groups
formed to fix quotas or prices or to control imports. At the same time
they insisted upon their desire to collaborate with the Government in
attaining the objects for which the traders’ associations were working.
As the war crisis continued, cooperators served on Government
committees which were endeavoring to stabilize prices and prevent
inflation. The Cooperative Wholesale, K. F., was “ always asked to
criticize and report on proposed Government schemes before they
are [were] put into operation.” During the discussion of the retail
sales tax (which covered 50 percent of the purchases of an average
family and became effective January 1, 1941), the chairman of K. F .’s
executive board presented to Parliament the cooperative movement’s
objection to such a tax. When the Government took steps to check
rising prices and inflation— the cost-of-living index (1914=100) stood
at 169 on July 1,1939, and at 239 on January 1,1943— the cooperative
movement accepted the program unconditionally. In order to aid
in the fight against inflation, K. F. also decided to withdraw money
set free by the depletion of stocks and use it to establish a post-war
“ Fund for Peace Supplies.”
144
Cooperatives in Individual Countries
Before the blockade which began with World War II, K. F. had
purchased goods abroad in such quantities that special ships had to be
chartered to carry them to Sweden, and the value of accumulated
stocks stood at 60,000,000 kronor by the end of 1939.
An
American observer reported that Swedish cooperatives bought
$12,000,000 worth of strategic materials on the world market in 1939,
and that, under Government controls, one-half of these reserves were
shared with private retailers. Cooperative exports were also turned
over to the Government.
The blockade eventually cut Sweden off from its former markets
and sources of raw materials to such an extent that the volume of
exports in 1941 was only about half of the 1939 volume and imports
dropped to about one-third. As shortages developed, cooperative
policy was based on the needs of the nation rather than those of the
cooperators.
To meet the need for wool, K. F. made an agreement with the
Swedish textile industry which laid the basis for the national planning
of the whole Swedish artificial-wool industry. Production of such
wool at K. F .’s Nordisk Silkecellulosa factory trebled. B y 1942
the value of Silkecellulosa’s output was 17,220,000 ronor, a sum
which meant a tenfold increase since 1938. Another factory, Cellul,
was built in 1942-43 jointly by K. F. and private textile firms. In
April 1942 K. F. bought 149,729 of the 150,000 shares of a large paper
industry, including also large tracts of forest lands and some water
power.
In order to assist in the war emergency, K. F. established a new
charcoal factory, a fish-marketing association (Svensk Andelsfisk)
in which consumers and producers collaborated, and the first Swedish
fish-oil producing plant, and it began production of synthetic rubber by
a newly developed process which used only Swedish raw materials.
Though K. F .’s sales rose during 1940, a drop caused by shortages
of goods followed in 1941. Actually the decrease in trade was greater
than the figures show, for the wholesale price index gave an average
increase of 11.9 percent.
In 1942, K. F./s financial position appeared to be “ extremely strong” ;
own capital represented about one-half of total capital resources. Net
surplus had risen from 4,490,000 kronor in 1941 to 4,770,000 kronor.
The combined balance sheet total for K. F. and its subsidiaries had
increased from 301,400,000 kronor to 337,800,000 kronor.9 Value of
production reached 185,320,000 kronor in that year.•
• Sources.—The report on Sweden is based upon data from the following publications: Statistisk Arsbok
for Sverige (Statistiska Centralbyr&n, Stockholm) 1939, 1941, 1942; Kooperativ Verksamhet 1 Sverige.
(Sveriges Officiella Statistik, Stockholm), 1908-10, 1914-16, 1920-22, 1926, 1926, 1930, 1933, 1934, 1935, 1936,
1937,1938,1939; Sweden, A Wartime Survey (American-Swedish News Exchange, Inc., New York, N . Y .)
1943; The Sweden Year-book (Stockholm, Sweden), 1938; Swedish Cooperative Wholesale Society’s Archi
tect’s Office (Kooperativa Forbundets Bokfdrlag) 1935; Swedish Consumers in Cooperation, by Anders
Hedberg (Kooperativa Forbundet, Stockholm, 1937); Cooperative Housing in Sweden (Royal Swedish Com
mission, New York World’s Fair) 1939; Cooperation in Sweden, by Axel Gjores (Cooperative Union, L td .,
Manchester, England) 1927; Social Problems and Policies in Sweden (Annals of American Academy of
Political and Social Science, Philadelphia, Vol. 197, 1938); Sweden, the Middle Way, by Marquis Childs
(Yale University Press, New Haven) 1936; Cooperative Organizations and Post-War Relief (International
Labor Office, Montreal, 1943); International Directory of Cooperative Organizations (International Labor
Office), 1939; Cooperative Information (International Labor Office), No. 5,10,1935; No. 2, 6, 7,1938; No. 1,
1940; No. 3, 5,1941; International Labor Review, International Labor Office, Montreal, March 1943; Inter
national Cooperative Bulletin (International Cooperative Alliance, London), issues of May-June 1922,
January 1924, June 1925; Review of International Cooperation (International Cooperative Alliance, London),
issues of February and March 1928, September 1933, November 1936, August and September 1939, March
and November 1941, March, June, July, and October 1942, January, February, May, June, November, and
December 1943; People’s Yearbook (English Cooperative Wholesale Society, Manchester, England}, 1937,
1940,1941; Report of the Inquiry on Cooperative Enterprise in Europe in 1937 (Washington, 1937); Cooper
ative Builder (Superior, Wis.), issue of July 8,1943; The Cooperative Consumer (North Kansas City, Mo.)
issue of January 30, 1943; The Cooperator (New York, N . Y .), December 1939; and certain confidential
sources.
Iceland
145
Cooperative Movement in Iceland
When, in 1942, Icelanders celebrated the sixtieth anniversary of the
first Icelandic cooperative association, the cooperative movement was
the strongest economic and social force in the country and its member
ship represented almost three-quarters of Iceland’s total population
of 120,000. Since 1886 when the control of the country’s entire
economic life was still a monopoly of Danish merchants, cooperative
influence had been powerful in the modernization of this northern
island. Agriculture, historically the mainstay of the population, was
mechanized, the land under cultivation doubled, the fishing industry
enlarged, and more than half of the population had become urbanized
in the last two or three decades before 1940. Dairies, fishing stations,
docks, greenhouses, abbatoirs, and refrigerating plants were built.
Extent o f Cooperative Development
By 1943 the distribution of practically all Iceland’s farm products
at home and abroad, was carried on by the cooperatives. The Union
and Wholesale Association of the Icelandic Cooperative Associations
(,Saraband Islenskra Samvinnufelaga, known as “ S. I. S.” ) was the
largest single business enterprise in Iceland and its monthly magazine,
Samvinnan, was Iceland’s most widely circulated periodical. It
operated a woolen mill, a tannery, and clothing, shoe, glove, and soap
factories. It had branch offices in Copenhagen, Leith (Scotland), and,
after 1940, in New York City. S. I. S. imported most of Iceland’s
farm machinery and handled more than 25 percent of Iceland’s total
imports. Of goods exported, it controlled all of the frozen mutton,
90 percent of all meat products, 80 percent of the wool, and 80-90
percent of the agricultural products.
Although Icelandic legislation covered cooperative housing associa
tions, and although cooperative building in Reykjavik (particularly
workers’ cooperative apartments) had been successful, the main co
operatives in 1940 were 44 selling and purchasing associations with a
membership of 13,018 and 2 consumers’ associations with 3,671 mem
bers. Of the consumers’ cooperatives, the Eyfirdinga Association
at Akureyri (which had been revolutionized by an Icelandic student
of Danish cooperative methods) was not only the oldest and strongest
organization but it was also the largest retail enterprise in Iceland.
Its diversified services supplied a large part of the town’s 5,090 in
habitants and a rural population of the same size; its productive works
included a dairy, margarine and soap factories, a bakery, sausage and
chemical works, and salting and freezing plants for mutton and fish.
The selling and purchasing cooperatives bought most of the goods
their members required and, through their ownership of slaughter
houses, refrigerating plants, fishing stations, fish-meal and cod-liveroil factories, and dairies, they processed a large part of the produce
which they sold for their members.
146
Cooperatives in Individual Countries
Effects o f the W ar
Iceland’s strategic position during World War II caused a shifting
of the annual export of some 2,500 tons of lamb, 600 tons of wool, and
unclipped sheepskins and fish, and of the Cooperative Union and
Wholesale’s purchases of goods (valued at 4,462,011 kroner 10*in 1938)
from the Scandinavian countries, Germany, Italy, and Great Britain,
first to Great Britain and then to the United States. A newly ap
pointed Trade Commssion handled exports, and food rationing and
excess-profits taxes were introduced. Prices and wages were first
“ pegged” (a representative of the federation of cooperatives was one
of the five members of the Price Regulation Committee) and later
“ controlled” by a Juridical Committee. Though the price index had
risen 125 points (April 1939=100) by the autumn of 1942 and some of
the cooperatives paid substantial excess-profits taxes, the cooperative
movement carried on business as usual and even expanded.
Cooperative membership, total trade, and own production in
creased. In 1941, Icelandic produce made up almost half of the
business of S. I. S. and more than a third of the affiliated associations’
total sales. Between the end of 1938 and the end of 1941, the value of
real estate, machinery, and stocks owned by S. I. S. and its affiliated
associations rose from 1,031,238 kroner and 6,501,286 kroner to
1,145,689 kroner and 7,929,179 kroner, respectively. S. 1. S. capital
increased from 992,882 to 1,783,430 kroner, and reserves from 1,617,044 to 3,014,824 kroner in the same period of time. It should be
borne in mind, however, that part of the increase in values was caused
by rising prices and that in 1940 and 1941 loan capital represented
more than two-thirds of the federation’s capital and almost two-thirds
of that of the associations.
Developm ent o f Cooperatives, 1 9 2 1 -4 2
The trend of cooperative development, as epitomized in S. 1. S. and
its affiliated associations, is shown in table 44. The table reveals a
continuous growth in membership, and an expansion in sales broken
only by the depression years of the early thirties.11
10 For par values of currency, see Appendix table, p. 278.
, 11 Sources.— T h e report on Iceland is based upon data from the following publications: Arbok Hagstofu
Islands, 1930 (Reykjavik, 1931); International Directory of Cooperative Organizations (International
Labor Office), 1929, 1933, 1936, 1939; Cooperative Information (International Labor Office), No. 12, 1939;
Review of International Cooperation (International Cooperative Alliance, London), issues of July, Novem
ber, and December 1942; People’s Yearbook (English Cooperative Wholesale Society, Manchester, Eng
land), 1934,1938,1940; Monthly Labor Review, February 1921; American Scandinavian Review (American
Scandinavian Foundation, New York), March 1939; Cooperatve League News Service (Cooperative
League of the TJSA, New York), April 6, 1944; Cooperative Builder (Superior, Wis.), November 25, 1940.
147
Iceland
T a b l e 44 .— Operations o f Union and Wholesale Association o f Iceland and its Affiliates,
1 9 2 1 -4 2
[For par values of currency, see Appendix table, p 278.]
Union and Wholesale Association,
S. f. S.
Affiliated associations
Year
Num*
ber
1921.
1923
1925.
1927.
1929.
1931.
1934.
39
38
38
38
39
37
39
1935.
1937.
1938.
1939.
1940.
1941.
1942.
39
42
46
47
48
48
(0
Their
mem
bers
8
0)
7,062
7,676
7,759
8,054
8,684
10,805
15,298
16,287
17,358
18,594
20,189
Their
business
Net
surplus
K ro n er
K ro n er
8
0)
12,986,992
18,299,826
14,661,655
(0
g
(n
fl)
0)
9,652,000
28,084.000
8
30,625,735
989,805
2 36,117,000
0)
2 44,054,000
0)
71,160,339 2,129,120
109,000,000
(0
Amount of
business
Net
surplus
Own
production
K ro n er
K ro n er
K ro n er
9.066.000
9.472.000
11,822,000
11.923.000
15.965.000
8
6,418,000
25.600.000
22,170,754
28.038.000
35.497.000
54,395,176
69,000,000
1.970.000
2.775.000
625,200
833,800
1,047,739
0)
4.257.000
5.657.000
0)
>9,000,000
* No data.
2 Agricultural associations not included.
* Estimated.
Baltic States
The cooperative movements in the Baltic States—Lithuania, Esto
nia, and Latvia— began late in the nineteenth century when these
regions formed part of Russia. The movements felt the effects of the
Russian revolutions of 1905 and 1917 and survived to collaborate
closely with other forces working for the independence of the three
peoples. After independence was achieved and each State carried
out land reforms which greatly enlarged the number of free but penni
less landholders, enthusiastic cooperative expansion occurred.
The type of cooperative organization which developed in the newly
independent nations naturally reflected the needs of the populations.
Agricultural and industrial opportunities amounting to revolution
came at the same time. Russian marketing and financial facilities
had to be replaced. Credit and loan associations early became strong
and remained so until 1939. The traditional consumers’ cooperative
was comparatively rare because of the small urban, population. A
compromise type of cooperative, sometimes described as a “ trading”
association, provided the agriculturalists with consumer goods, agri
cultural supplies, and it also purchased agricultural products. Dairy
cooperatives built up strength as the quality of cattle, milk, butter,
and poultry was improved. Other types of cooperatives characteris
tic of the three Baltic States were the “ peat and litter,” the potato or
alcohol distillery, insurance, fishermen’s, and agricultural improvement
associations.
The years of inflation in the 1920’s followed by the difficult years of
the thirties led to frequent Parliamentary and other changes and
finally to measures resulting in the introduction of the corporative
State. Lithuania established a more or less conservative single-party
dictatorship in 1926 which was continued in power in 1932 and 1938.
Estonia began a similar system in 1933 and Latvia in 1934.
148
Cooperatives in Individual Countries
In all three countries, the first Governments had been friendly to
the cooperative movement and Government and cooperative leader
ship had in some cases been identical. After the establishment of
the corporative State, the cooperatives were assigned to places in the
appropriate corporative group and Government control of the central
cooperative organization became complete. Cooperatives received
export monopolies, they entered Government subsidized joint-stock
companies and appear to have participated in many ways in the
Government system of export, import, and domestic economic control.
Figures available indicate a large expansion of “ cooperative” business
under these conditions.
Before the present war the cooperative movement in the three
countries had attained a position of considerable influence. In Lithu
ania the consumers' cooperatives were serving at least a third of the
people and in Estonia the cooperative wholesale was the largest com
mercial enterprise in the country. In both of these countries the
movement had friendly encouragement from the public authorities.
In Latvia, however, where the central federation had expanded into
foreign as well as domestic trade, the corporative government engi
neered a “ voluntary" liquidation of this and another central organiza
tion and forced the members of both to affiliate with a State-dominated
wholesale organization.
Successive occupation of the countries by the Russians and then the
Germans resulted in loss of autonomy of the cooperative movement
in all three countries, increased control by the occupation authorities,
and losses of property by confiscation. Reports indicate, however,
that as late as the end of 1942 the cooperatives were still in operation
in Estonia. No data are available for the other two countries.
Cooperative Movement in Estonia
When in June 1920 the Estonian people adopted a democratic con
stitution which placed much power in the Assembly, sweeping economic
changes were already under way. Land legislation of the previous
year had nationalized 96.6 percent of the acreage of the large estates
which formerly made up 58 percent of the nation's area. From the
nationalized land 83,514 new independent holdings were created before
1936, more than 56,000 of which lay outside of towns. Even before
Estonia became ndependent, its agricultural development had been
more advanced than was the case in Russia and small landholders had
begun to profit from the example of Danish agricultural cooperation.
The Estonian cooperative movement was closely associated with
the movement for national independence. After independence,
cooperatives which had begun under the Russian regime were re
organized, some of them with considerable Governmental support.
Although the customary credit and insurance cooperatives appeared,
agricultural associations predominated. A central agricultural feder
ation, founded in 1911, encouraged production for export and a whole
sale, started in 1917, promoted production and sale. By 1927 the
central dairy organization was exporting 59 percent of the national
butter export and the wholesale was handling from 65 to 95 percent of
the fertilizers coming to the Estonian market. Ten years later the
wholesale handled one-third of the total Estonian dairy-products out
put and butter alone made up 19.9 percent of the total value of all
149
Estonia
national exports. About one-half of the population was said to be
included in the cooperative system.
In the early thirties changes in governmental forms began to appear
and by 1937 a definite trend toward the corporative state. Never
theless the cooperative movement, which pursued a policy of political
neutrality, had friendly encouragement from the public authorities,
and cooperatives were given export monopolies in certain agricultural
products (butter, meats, eggs).
After the outbreak of World War II, when the country was occupied
first by the Russians and then by the Germans, the forces of occupa
tion utilized the services of the cooperatives, depriving them at the
same time of their autonomy. In spite of all the handicaps the move
ment was reported to have increased in size and business throughout
1942. Later data are not available.
T ypes o f Associations
Almost 75 percent of Estonia’s population was agricultural and as
would be expected, therefore, by far the greater part of the coopera
tives were those serving farmers, needs. Among the agricultural
cooperatives the dairies were the most important, but other marketing,
credit, and insurance associations were also important. Among the
more unusual forms of agricultural associations were the peat co
operatives producing both peat for fuel and peat used for barnyard
litter, and the associations distilling alcohol from potatoes.
Consumers’ cooperatives included the distributive associations,
urban credit organizations, and housing. Table 45 shows the number
of cooperatives and status of each type in Estonia in 1937.
T
able
45.—N um ber, M em bers, and Business o f Cooperative A ssociations in Estonia ,
1937
T y p e o f association
C onsum ers’ distributive associations (urban an d ru ral).
H ousing, and hnilding and loan associations
C redit associations, m ral .
W ork ers’ productive associations..................................................
Fish erm en’s associations. ..................................... ........ ...................
Agricultural associations: M ark etin g..........................................
E lectricity associations...................................- ..................................
Insurance association s.........................................................................
N u m b e r of
associations
T h eir
m em bers
183
10
242
16
28
1,286
24
168
46,278
300
105,443
234
(*)
36,962
272
30,831
T o ta l
b u sin ess 1
37,893,000
687,000
(2)
22,483,000
6,000
*55,643,000
i A m o u n ts given in Sw iss gold francs; for par value, see A p p en d ix table, p . 278.
1 N o data.
* A m o u n t of insurance outstanding.
Credit and loan cooperatives.—The first Estonian cooperative—a
“ savings society” —was founded in Tartu in 1902. During World
War I all capital deposited in Russian banks was lost. After Estonia
became independent, the peasants’ new freedom and the land reforms
created a large demand for credit, and savings cooperatives were
widely promoted. A law of 1920 eliminated the difference between
savings and mutual credit associations and authorized cooperative
banks to carry on all banking functions. Loans were granted against
personal bond and to some extent on mortgages but only for the
promotion of production.
150
Cooperatives in Individual Countries
The number of credit cooperatives grew from 102 with 27,000
members in 1922 to 202 with 65,000 members in 1929. By 1931 co
operative banks appeared to play as large a part as the joint-stock
banks in the national economy. Whereas the total deposits and
loans of the joint-stock banks amounted to 37,700,000 kroons and
67,000,000 kroons respectively, the deposits and loans of only 182
out of the 230 existing cooperative banks were 34,100,000 kroons
and 43,000,000 kroons, respectively. In 1936 the cooperative bank
ing institutions had a combined balance of 72,200,000 kroons.
Credit cooperatives were affiliated to E. T. K. and by 1939 that
central and its affiliates were reported to account for 52 percent of
the total Estonian deposits and 48 percent of the loans made.
The Central Bank of Rural Cooperative Credit Cooperatives
(Eesti Rahvapank) was founded in 1920. By 1928 the bank served
as the central institution financing the entire cooperative movement,
all the cooperative central organizations being included in its mem
bership.
It acted also as the agent of the Estonian Treasury in
distributing considerable amounts of Government credit to fisher
men and farmers.
Cooperative insurance.—Local cooperative insurance funds origi
nated in Estonia in the second half of the nineteenth century because
of a Russian regulation requiring insurance of farm buildings. The
Central Federation of Mutual Insurance Associations was formed in
1923 and at the end of the years 1928, 1931, and 1934 the affiliated
insurance associations numbered 231, 291, and 280, respectively.
Their members, however, dropped from 56,370 to 30,831 between
1934 and 1938. At the opening of the latter jear the Federation's
amount of insurance outstanding aggregated 218,082,000 kroons;
premium income totaled 592,000 kroons. For the affiliated local
associations (each operating in its own locality only) the respective
figures were 66,321,000 kroons and 179,000 kroons.
According to a report of 1939, Estonian insurance cooperatives
accounted for 65 percent of the total number of policies, 48 percent
of the total amount, and 40 percent of the insurance premiums in
Estonia.
Electricity cooperatives.—When Estonia developed electric power
and made progress in laying high-tension electric trunk lines, co
operative associations of electricity consumers were organized. In
1937 those in operation were reported to be engaged mainly in run
ning transformer plants.
Developm ent o f Consumers’ Cooperatives
The Estonian consumers' cooperative movement began in 1902 in
South Estonia when Estonia was a province of Russia. In spite of
the lack of a satisfactory basis in Russian law, after 1906-07 this
kind of cooperative enterprise continued to develop until World War
I. During that war many of the associations were compelled to
cease operations and Estonian material losses were severe, but the
movement achieved federation and formed the Estonian Cooperative
Wholesale (Eesti Tarvitajateuhisuste Keskuhisus)f popularly known
as “ E. T. K .", in 1917. After Estonia attained independence, con
sumers' cooperatives were founded so rapidly that the members
Estonia
151
numbered almost 100,000 by 1921. The members were mainly in
rural areas.
After the end of the war, E. T. K. broadened its activities to in
clude the handling of fertilizers, agricultural machinery, building
materials, and the sale of produce—flax, linseed, grain, and potatoes.
Stores were opened along the whole coast line to supply the fishermen
and purchase fish. Processing and production were started, with
three fish-preserving and one coffee-roasting plant and the prepara
tion of fruit wines. In the mid-1920’s the principal commodities
handled were agricultural products, food, drygoods, and some leather,
chemicals, and household supplies.
During the depression of the 1920’s, liquidations and mergers of
associations reduced the number of cooperatives affiliated to E. T. K.
year by year. In 1929 associations numbered 242 and membership
had fallen to 56,648, as may be seen in table 46. In 1934 the number
of associations and members dropped to an all-time low— 180 and
34,206 respectively. The farmers suffered so badly from the depres
sion that many cooperative associations lost a large part of their
shares and reserves and were saved mainly through the exertions
o f E . T. K.
In 1933 a new constitution (with the President being given almost
dictatorial powers) replaced the precarious Parliamentary shiftings
characteristic of the first Estonian democratic system. Abandon
ment of the gold standard, in the same year, and a good harvest com
bined to start an economic revival, in which the cooperative movement
shared. Both membership and the retail and wholesale trade of the
cooperatives began a slow climb (table 46) which was continued even
under a new change of constitution in 1937, inaugurating a partial
corporative state, with the creation of a second chamber in the na
tional Parliament, representative of corporations and vocational groups.
In the mid-1930’s the retail cooperatives operated 533 stores and
did about 15 percent of the total Estonian retail trade. By 1939 the
proportion of the retail trade cooperatively handled had risen to 24
percent.
In 1934 E. T. K. handled 10 percent of the total national import
trade, 50 percent of the agricultural machinery imported, 50 percent
of the cattle foods and salt, 40 percent of the sugar and petroleum,
30 percent of the rice, and 80 percent of the fertilizer. It marketed 23
percent of the eggs exported, also some quantities of fruit, fish, and
potatoes, and (on a commission basis) 13.5 percent of the butter
exported. This whole export trade, however, was cut off by the
Government establishment of a “ special central organization” for the
purpose in 1937.
Though E. T. K. maintained branches in Tartu and some 10 other
outlying regions and provided its affiliated associations with an
average of 60 percent of their goods, E. T. K .’s greatest progress was
made in the development of production. By 1937 goods produced in
its own plants made up about 20 percent of its total turnover. The
enterprises included the coffee-roasting and fish-curing establishments
mentioned above, a tobacco factory begun in 1933 which by 1937
supplied 50 percent of the market demand, a metal works making
chains, wire, tinware, and nails sufficient to furnish 50 percent of the
local demand, a flour mill, an engineering works which produced
152
Cooperatives in Individual Countries
agricultural implements, bicycles, and building supplies, and a chemical
factory supplying soaps, cosmetics, lubricants, mineral colors, and
polishes.
T
46.—M em bership , Sales, and Production o f Cooperative W holesale A ssociation ,
E . T , K ., and A ffiliated Consum ers’ Cooperatives, in Specified Years, 1917-42
able
A ffiliated consum ers’ associations
Year
1917
_____
_____
N um ber
N um ber
of
m em bers
55
8,830
A m o u n t of
sales
Rubles
________
8,416,214
K roons
1919
1921
1923
1925
__________________________
_________________
___________________________
W holesale, E . T . K .
A m o u n t ol
sales
V a lu e of ow n
production
Rubles
K ro o n s
1,862,497
K roons
__________________________
1927..........................- .......................................
156
250
263
277
267
65,195
99,312
89,197
78,214
69,064
817,475
11,352,761
20,381,460
27,763, 250
27,903,540
384,185
8,856,559
12,133,733
14,359,899
14,034,919
1929...................................................................
1931...................................................................
1932...................................................................
1933...................................................................
1934...................................................................
242
218
203
184
180
56,648
60,000
60,000
34,795,000
22,347,000
17,929,000
20,021,000
22,821,000
20,977,362
15,180,000
11,688,000
12,687,000
15,399,000
0
0
0
26,249,000
35,000,000
45,000,000
45,500,000
50,000,000
18,948,000
24,384,000
29,000,000
30, 354,471
36,300,000
4,130,000
4 ,970,000
6,0 8 0 .0 0 0
7 ,600,000
8,8 0 0 .0 0 0
1935...................................................................
1936...................................................................
1937...................................................................
1938...................................................................
1939...................................................................
1942...................................................................
0
0
0)
34,206
183
35,343
192
183
208
47,000
45,868
53.900
0)
0)
0
92,715
1,632,000
3,072.000
G erm an marks G erm an m arks
4 1 ,400,000
8 ,0 0 0 ,0 0 0
1No data.
E. T. K. acquired in 1932 a large new site in Tallinn on which head
offices, stores, and part of the factories and workshops were central
ized; this property was administered by a subsidiary company. Other
property included mines, an estate used for farming, gardening, and
stock raising, and the largest tree nursery and some of the best milking
herds in Estonia.
In 1936 E. T. K .’s affiliated associations were 180 consumers’ , 178
dairy, 203 banking, 211 insurance, 180 agricultural-machine-using, 133
fuel and litter, 96 land-improvement, and a few fishermen’s, cattlebreeding, and house-building cooperatives. Activities carried on for
these affiliates and itself included propaganda, the editing of the main
cooperative journal of Estonia, a publishing works, the transport and
insurance of goods, work in auditing, and the operation of a “ hospital”
department which nursed or took over insolvent cooperatives. E. T.
K. also supported its own cooperative college which in 1938 trained
more than 600 students.
By 1938 E. T. K. had become the largest commercial and industrial
enterprise in Estonia.
In the meantime a partial reorganization of the cooperative
structure, which had begun under the new government and con
stitution of 1933, was carried forward by the later corporative
government. Central federations were created, under sponsorship
of the Government, for the dairy, slaughtering, and poultry associa
tions in the agricultural cooperative movement. In 1937 these
were given monopolies on the export of butter, meat, and eggs.
Estonia
153
Apparently on the initiative of the cooperatives, the Government
created a Chamber of Cooperation at the end of 1935. The 60 mem
bers of the Chamber were to be elected by the cooperatives for 4-year
terms and the task of the Chamber was to watch and assist in all
branches of cooperation. After a law of 1937, the Chamber comprised
sections for cooperative banking, commerce, insurance, industry,
and “ cooperative utilization," each with its own assembly. The
Chamber employed 16 controlling instructors and published a monthly
magazine. According to a Government publication the Chamber's
activities were advice and training of cooperative personnel, control
of bookkeeping, the “ elucidation of cond tions and requirements"
of cooperatives, and “ the formulation of the attitude of the cooperative
movement with regard to laws concerning cooperation." Membership
in the Chamber was compulsory for all cooperatives, as was also
the payment of affiliation fees “ according to turnover."
Estonian Cooperatives in W orld W ar I I
In June 1940 when the Russian forces marched into Estonia and.
incorporated that nation into the Soviet Union, the cooperative
movement was completing a very satisfactory decade of development.
A network of 208 consumers' cooperatives with 600 stores and an
annual turnover of 50,000,000 kroons had been spread over the
country.
The Russians at once nationalized all private business and requi
sitioned cooperative experts to organize this new form of State
trading. Though the external organization of the cooperative system
was not touched, the director of E. T. K. was arrested and taken to
Russia and new cooperative leaders were installed. E. T. K. became
directly subject to the Central Union of Consumers' Associations
in Soviet Russia (Centrosojus). Both the cooperatives and the new
State system of trade operated under control of the People's Com
missariat. Many of the nationalized private businesses, however,
had to be administered by the cooperatives. The consequent
economic disorganization, the shift to the Russian currency, and
Soviet priorities of purchase rights all combined to diminish supplies.
Even before the Germans advanced into Estonia in 1941 and the
Russians retreated, taking with them motors, horses, ships, trains,
and goods, Estonian stores were nearly empty. One estimate placed
the damage done to the cooperatives by the Russian occupation at
112,000,000 kroons.
The Germans, in their turn, relied on the cooperatives for services
of distribution, and they too denied the associations any democratic
independence. A German order of September 16, 1942, forbade
the associations to hold their annual meetings and transferred all
power to executives appointed by the civil authorities. In December
1942 a new central cooperative organization for Estonia was created
and all cooperatives were required to register in it within 10 days,
on penalty of liquidation. The largest cooperative paper mill was
confiscated and transferred to the German Ostland-Faser Co.
. In spite of all these handicaps and invasions of cooperative rights,
the Estonian cooperative structure appeared to have survived both
the Russian and German occupations and to be in a firm financial
588544°— 44------ 11
154
Cooperatives in Individual Countries
position. The number of cooperative associations had increased,
and for 1942 E. T. K .’s annual sales totaled 41,400,000 German
marks, the value of own production 8,000,000 marks,' and its net
earnings for the year reached 500,000 German marks. Most of the
earnings were allocated to reserves.1
Cooperative Movement in Latvia
Though some cooperative organization began in Latvia as early as
the 1860’s, it was not until 1907 that the Cooperative Central Union
and Wholesale Association, Konzums, was established to carry on
wholesale and educational activities. When World War I began a
few years later, Latvia’s population was 2,500,000 and when it ended,
1,596,131. At the time of the formation of independent Latvia, in
1920, not only the Latvian business structure but the farmers’ build
ings and fields had been destroyed.
The cooperative movement, however, entered the new era with en
ergy. To coordinate the activities of the different types of cooperative
associations, a Council of Cooperative Congresses was established
in 1920 and various central cooperative federations soon appeared.
As Latvia was predominantly agricultural, farmers’ cooperatives of
various types formed by far the greatest section of the cooperative
movement. Even the consumers’ cooperatives were largely rural and
the cooperative wholesale, Konzums, was both a distributive and a
marketing organization.
Hastened by the world-wide depression of the early thirties, the
Latvian Government assumed a largely corporative and dictatorial
form in 1934. It forced the liquidation of the federation of workers’
cooperatives and Konzums, and decreed that their affiliates become
members of a new Wholesale that was not cooperative but a Stateowned stock company. In the period, 1934-39, the whole Latvian
cooperative movement was transformed through forced amalgama
tions and State control.
The Russians took possession of Latvia on June 17, 1940, and their
treatment of Latvians and Latvian cooperatives appears to have fol
lowed the same course as in the case of Estonia (see p. 153). When the
Germans conquered the Baltic States in March 1941, Latvia and the
other two countries, in addition to White Ruthenia, were constituted
as the Ostland District of the Reich. The property previously
nationalized by the Russians was confiscated by the Germans in
August 1941. The farmers’ marketing cooperatives were reestab
lished by the Germans and were used as producers and collectors of
produce for the conquerers.
T yp es o f Associations and Their A ctivities
The cooperative movement in Latvia had the usual standard types.
One form of agricultural cooperation— associations marketing grain
t Sources .—1The report on Estonia is based upon data from the following publications: The Estonian
Yearbook, 1929 (Tallinn); Estonia, Population, Cultural, and Economic Life. ([Riigi statistiska Keskbiiroo],
Tallinn, 1937); International Directory of Cooperative Organizations (International Labor Office). 1929,
1933, 1936,1939* Cooperative Societies Throughout the World—Numerical Data (International Labor Office.
1939); International Cooperative Bulletin (International Cooperative Alliance, London), December 1922;
and March 1926; Review of International Cooperation (International Cooperative Alliance, London),
June 1928, January 1929, April 1931, July 1933, July 1935, September 1936, June 1938, February and August
1939, October 1943, and February 1944; People’s Yearbook (English Cooperative Wholesale Society,
Manchester, England), 1929, 1934, 1936, 1937, 1938, 1939,1940,1941.
155
Latvia
and other agricultural products— disappeared early in the 1930's
when by successive measures the Government formed State monop
olies of both domestic and foreign trade in grain, bread, seed, and
potatoes. The number of cooperatives of each type in 1937 is
shown in the accompanying statement:
N u m b e r of
associations
All types_________________________________________________ 2, 196
Consumers, cooperatives_________________
Credit associations_______________________
Savings and loan associations_____________
Insurance associations____________________
Agricultural associations:
Dairies______________________________
Agricultural machinery______________
Distilleries___________________________
Peat_______________________________ _
Marketing of grain and other products
Fishermen’s associations_____________
184
503
477
450
258
228
24
54
0)
18
1No longer any associations of this type; all such marketing a Government monopoly.
Cooperative insurance—In the period before World War I when
cooperative credit organizations were beginning to^ ameliorate dis
tressing rural conditions, cooperative insurance associations were also
being formed to cover fire and other risks. The Central Federation
of Mutual Insurance Associations (Savstarpejas apdrosinasanas
centroid savieniba) was established in Latvia in 1922. By the end of
1929 there were in Latvian towns 32 insurance cooperatives with
19,742 members and in rural areas 392 cooperatives with 73,495
members. At the beginning of 1939 nine years later, 606 organizations
were affiliated to the Central Federation, and of these 469 were insur
ance cooperative associations. After the new Government took
control in 1934, model rules for the insurance union were drawn up
and approved on December 16, 1937. The insurance organizations
were little changed, however, “ because a Government representative
[was] at the head of the Union.”
Although the number of insurance cooperatives decreased between
1935 and 1938, membership rose from 114,579 to 125,839, and both
insurance outstanding and reserves increased.
T
able
47.— M em bership and Operations o f Cooperative Insurance Associations in
L a tvia ?!9 3 4 -3 8
[For par values of currency, see Appendix table, p. 278]
Year
___________
103K
_
103fi
__________
1937_____________________________
__________
1938.......................................................................
Number of
associations
454
456
454
450
Membership
114,579
118,279
122,445
125,839
Insurance
outstanding
Reserves
Lats
Lats
579,487,932
644,071,354
671,338,067
4,195,751
4,572,601
4,909,328
According to a published report of the former Latvian Finance
Minister, cooperative insurance organizations did well in 1938.
More than 120 new associations were founded, mainly in the eastern
part of the country where cooperatives had not been strong. The
assets of the Central Federation increased 22 percent, reaching a total
156
Cooperatives in Individual Countries
of 1,600,000 lats, and shares and reserves rose 26 percent to a total of
1.256.000 lats. At the same time, premium income amounted to
1.300.000 lats, showing an increase of 39 percent. From these opera
tions the Central Federation returned a dividend of 63,747 lats to
premium payers and derived a net surplus of 71,677 lats.
Cooperative fisheries.—A Latvian Union of Fishermen’s Cooperative
Associations was formed in 1919. By 1934 this Union included 47
associations with 5,000 members. A new union, the Central Federa
tion of Fishermen’s Cooperative Associations, was established under
the new Government in 1937 and was granted a monopoly of the whole
sale trade in fish in Riga on October 15, 1939.
At the beginning of 1939, fishermen’s cooperatives numbered 18 and
their members 1,101. The aggregate output of canned fish was
valued at 1,209,900 lats in 1938, a sum which indicated an increase of
40.5 percent over the output of 1937. On January 1, 1939, the total
.balance of the Central Federation amounted to 273,794 lats, of which
shares and reserves made up 43 percent.
Development o f Consumers' (Trading) Cooperatives
When 69 delegates representing some 37,000 cooperators gathered
at Riga early in 1922 for the first cooperative congress of distributive
associations, the country was in process of being rebuilt, and cooper
ative development was retarded by the instability of the currency,
lack of capital, low consumer purchasing power, and inexperienced
leadership. Delegates also charged that the tax laws bore more
heavily upon the cooperatives than was the case under the Czar’s rule.
Under such conditions Latvian cooperatives developed as generalpurpose rather than as specialized types, and the membership was as
diversified as the trading activities. In 1926 the variety of occupa
tions represented among the 77,803 members of the 314 consumers’
cooperative associations then existing resembled somewhat the
occupational distribution of the population in 1930, as shown below.
Percent of
population
P ercent of
cooperative
m em bers
59. 05 Agricultural land proprietors___
39. 0
Freeholders and leaseholders__
4. 6
5. 46 Intellectual workers___________
28. 2
15. 20 Wage-earning laborers________
9. 8
6. 41 Artisans______________________
10. 2
4. 49 Industrial workers____________
.7
.6
9. 39 Traders_______________________
Others________________________
6. 7
Total................... ..............100.00
Total................................... 100.0
Agriculture___________________
Professions (education, public
administration)_____________
Manufacturing industry_______
Trade and commerce__________
Commerce and transportation. Others________________________
From 1926 to 1930 consumers’ cooperative membership averaged
about 63,000 persons. By 1931 the depression had begun and mem
bership had fallen to 46,930. The unemployment and distress of the
people, the frequent bankruptcies, and general insecurity in Latvian
business were reflected in declines in business and sizable deficits in
1931 and 1932 (table 48).
The Central Union and Wholesale, Konzums, formed in 1907, was
the principal organization of its type in Latvia. One of its avowed
aims was to assist the agricultural interests and another was to organ
Latvia
157
ize the production and purchase of goods handled by the affiliated as
sociations. Konzums thus dealt not only in the traditional consumer
oods but also in fertilizers and seeds and, in the 1920’s, it exported
aeon and butter.
In 1928 when its affiliated associations numbered 402 and their
membership was 80,000, Konzums’ turnover reached 49,903,570 lats,
almost twice the figure for 1924. Goods purchased by the affiliated
cooperatives accounted for 87 percent of the turnover of 1928. In
that year its exports of meat, butter, and linseed were valued at
6,139,949 lats and its imports of agricultural machinery, manufactured
goods, fodder, manure, and provisions at 7,482,688 lats. Though the
meat-export department suffered severely in 1928, all other depart
ments were thriving. The position of this organization in the national
economy may be seen from its importation of 50 percent of the feeding
stuffs, 34 percent of the artificial manure, and 29 percent of the agri
cultural machinery imported by the entire country. The productive
enterprises of Konzums consisted of a flax mill, a bone mill, a sawmill,
a salt plant, and two electric-powered slaughterhouses. In 1934
Konzums’ enterprises included also a fat-refining plant and a pharma
ceutical laboratory.
When the world-wide economic collapse of the early 1930’s arrived,
Konzums’ affiliated associations included 206 consumers’ , 57 agri
cultural, 54 dairy, and 20 other associations. In 1931 turnover de
creased 50 percent to 22,400,000 lats. The balance sheet showed
heavy investments in real estate, large debts owed by customers, and
a low percentage of own resources. As Konzums’ main creditors
were the State Bank and the Ministry of Finance, the latter appointed
a State Administrator to oversee its operations.
f
Cooperatives Under State Dom ination
In 1934 the Prime Minister of Latvia requested the Parliament to
change the constitution. Upon its refusal to do so, an armed “ putsch”
occurred, and a new government was formed under the Prime Minis
ter, which disregarded the numerous political parties (at one time
numbering 44). In 1935 and 1936 four chambers of a corporative
character were formed.
Activities of the cooperative movement were placed under 3 new
laws, the Cooperative Societies and Associations Act, the Cooperative
Fund Act, and the Government Security Fund Act. This legislation
was said to give the cooperatives “ better opportunities for outside
work than formerly” and not to interfere with the use of Rochdale
principles. The Government reserved the right to make some ad
justments in the cooperatives, and all decisions of boards and meetings
were to be approved by the Government. Up to 1938 (report of
December) it had appointed members to 10 cooperative boards out
of a reported total of 2,000 cooperatives.
Actually however, the Government was adapting the cooperative
movement to the new ideology. Some cooperative association prem
ises were searched, some associations were closed. The cooperative
law of June 17, 1937, brought the entire movement into line with the
new policies by compelling all associations to submit new sets of rules
before being licensed and by obliging a)1 to join their respective unions
and submit to partial Government auditing. Danger from the liqui
158
Cooperatives in Individual Countries
dation of cooperatives was eased by a law requiring that all uncon
cluded liquidations be handed over to the Latvian Credit Bank and
by allowing a sum of 10,000,000 lats to be used to repay the losses of
cooperative members.
In 1935 only 1.3 percent of Latvia^ 29,576 retail sale establish
ments were cooperative, except in the food business in which the pro
portion of cooperative ownership was 4.7 percent and of turnover 16
percent. As may be seen in table 48, an increase in earnings began
in 1934 and in amount of business, and patronage refunds in 1935.
Although the consumers7 cooperative membership had fallen to
27,047 (an all-time low) by 1937, sales that year reached 38,193,134
lats, thus topping the largest previous total by almost 7,000,000 lats.
In 1937, too, interest and patronage refunds were larger than ever
before. Share capital amounting to 914,383 lats exceeded by 56,039
lats that in any earlier year and total own capital had never been
greater except in 1932. This progress was continued in 1938.
T able
48.— Trend o f Development o f Consumers’ Cooperatives in Latvia, 1 9 2 6 -3 8
[For par values of currency, see Appendix table, p. 278]
Own capital
Num
ber of
associ
ations
Num
ber of
stores
1926-30 (av
erage)____
1928.............
1929...............
1930...............
1931...............
1932...............
308
302
301
295
300
290
451
434
444
468
476
459
598,289
597,903
634,928
722,555
786,534
858,344
2,837,054
2,679,921
3,240,365
3,775,940
3,925,819
4,092,359
9,528,629
9,404,142
9,947,045
10,608,374
9,950,036
8,725,197
27,236,892
26,547,434
31,501,290
28,322,312
25,165,305
18,335,571
163,363
223,578
286,610
113,836
179,814
1158,767
1933...............
1934..............
1936...............
1936..............
1937...............
1938...............
249
234
192
194
187
184
402
828,193
812,842
388
375
735,303
393
798,816
914,383
399
428 1,051,616
3,917,161
3,905,575
3,521,011
3,702,860
3,966,672
4,401,899
6,069,378
5,611,519
4,464,241
4,481,410
5,026,210
5,929,515
19,776,008
19,293,851
22,159,423
28,978,534
38,193,134
58,900,000
114,972
186,283
321,930
435,295
759,077
0
Year
Share
capital
Lats
Outside
capital
Sales
Earnings
Inter
est
Patron
age re
fund
L a ts
L a ts
Total
Lats
Lats
L a ts
L ats
27,471
28,718
31,129
31,961
27,720
21,482
86,599
95,301
113,671
111,710
57,788
33,021
25,376
65,413
32,356
62,094
36,060
84,528
41,464 121,539
68,472 219,709
0
,
«
i Deficit.
* No data.
In January 1937, under pressure from the Government, Konzums
and a workers7 cooperative federation, Union of Cooperative Distrib
utive Associations, voted for their own “ voluntary77 liquidation and
the transfer of their assets and liabilities to a new organization— a
joint stock company, formed by the Government. By this act the
Government amalgamated two organizations which had been rivals
within the Latvian cooperative movement since 1920. This rivalry
reflected differences between “ bourgeois77 consumers and “ radical77
workers7 groups which began as early as the Russian Revolution of
1905, subsided under the Bolshevist domination, and reappeared in
independent Latvia. The Union of Cooperative Distributive Asso
ciations, though neutral in politics, was founded to safeguard the
interests of the workers. Among Konzums7 affiliated associations, on
the other hand, there were purely agricultural cooperatives, savings
and loan, and dairy cooperatives as well as consumers7 cooperatives
which supplied both household and agricultural needs. The workers7
organization was a small federation which had only 34 affiliated
associations at the time of its dissolution.
159
Latvia
T
able
49.— Num ber and M em bers o f Certain T ypes o f Cooperative Associations in Latvia,
1 9 2 6 -3 8 , by T ype
Year
Total
Consumers,
Credit
associa
tions of
specified Num Mem Num Mem
bers
ber
bers
tires
ber
Insurance
Num
ber
Mem
bers
Dairies
Num Mem
ber
bers
1926-30 (average)____________
1928............................................
1929...............................................
1930..............................................
1931..............................................
1932...............................................
1,742
1,772
1,773
1,780
1,784
1,751
308
302
301
295
300
290
63,304
54,475
53,376
50,320
46,930
44,229
578
588
592
605
623
628
172,098
172,824
181,124
195,353
205,835
208,540
408
417
425
430
438
440
83,506
86,797
93,315
99,233
95,858
99,437
448
465
455
450
423
393
21,462
21,766
23,611
25,017
24,971
24,423
1933...............................................
1934...............................................
1935..............................................
1936...............................................
1937...............................................
1938...............................................
1,692
1,654
1,592
1,550
1,441
1,395
249
234
192
194
187
184
36,792
32,568
28,358
27,580
27,047
27,577
634
626
618
606
532
503
208,170
204,680
202,234
205,495
202,696
205,964
447
454
456
456
454
450
103,891
109,394
114,579
118,279
122,445
125,839
362
340
326
294
268
258
22,721
20,790
19,628
19,145
18,541
18,538
On August 4, 1937, cooperative delegates received “ in subdued
silence” the Government terms: Amalgamation of small associations;
and all local associations affiliated to the two defunct unions to become
automatically members of the new company, Centrala Savieniba
Turlba, to which was given a monoply of certain articles of import.
The chief shareholders in Turlba were the Government banks; the
affiliated associations held only 1,000,000 lats out of Turiba’s 7,000,000
lats of share capital. Turlba, in turn, was a stockholder in the various
joint stock companies established by the new Government. Between
1936 and 1938 the Latvian Government established joint stock com
panies in a great many fields of economic activity— the fuel trade;
the heavy industries; production of brick, Ume, beer and soft drinks,
oils and liquid fuels, timber, and peat; and export of various commod
ities. In 1938 Turlba, then in its second year, owned shares amount
ing to 2,118,000 lats in 15 such joint stock companies, of which the
greater part of the share capital was held by Government banks and
other organizations.
Under this plan of State control, by 1939 (when the results of an
official study were published) the Latvian cooperative movement was
reported to have “ changed beyond recognition.” The legal position
and to a certain degree the organization of the cooperative system had
been altered, as has been mentioned above. The total number of
cooperatives listed in the Government statistical annual had dropped
from 1,654 in 1934 to 1,395 in 1938 and membership in consumers’
associations had decreased from 32,568 to 27,577 (see table 49),
Membership in credit and insurance cooperatives, however, had grown
about 1,000 and 15,000, respectively. According to a report published
by the Latvian Legation in Washington, consumers’ cooperative sales
had increased from 19,293,951 lats in 1934 to 58,900,000 lats in 1938,
the increase between 1937 and 1938 being given as 20,700,000 lats,
that is, 54 percent. Improvements in the consumers’ cooperative
position described by the same report included also a growth of 16
percent in the number of stores, of 30 percent in aggregate balances,
of 49 percent in the number of employees, and of 44 percent in the
aggregate share and reserve capital. How much freedom was ac
corded to the cooperatives in the management of their activities is
not apparent from the reports available.
160
Cooperatives in Individual Countries
At the end of 1938 the Central Union and Wholesale, Turlba, had in
affiliation 209 consumer associations, 171 dairy, and 34 miscellaneous
associations. Total sales had risen from 56,000,000 lats in 1937 to
80,000,000 lats in 1938. Turlba began the year 1939 with a balance
of some 18,000,000 lats, of which shares and reserves made up more
than half. Net surplus, which had been 480,457 lats in 1937, in
creased to 1,008,337 lats after the payment of patronage refunds of
300.000 lats and 650,000 lats, respectively, in 1937 and 1938.3
Cooperative Movement in Lithuania
The organization of thrift and loan and peasants' trading coopera
tive associations began in Lithuania in the 1870's and 1880's, and some
real progress in cooperation occurred about 1904. Toward the end
of the nineteenth century the westernizing of the medieval Lithu
anian land system began under the leadership of intellectuals. How
ever, the Lithuanian peasant farmers had been serfs until freed by
legislation passed by the Russian Government during the period
1862-65, and as long as Lithuania remained under Russian domination
the people lived practically as they had in the Middle Ages.
From 1915 to 1918 during World War I the Germans occupied
Lithuania and the country lost much of its assets— 47 percent of its
cattle, 38 percent of its norses, and 44 percent of its pigs. Some
57.000 buildings were destroyed. In the same period of time, 90
percent of the cooperative organizations in existence before the war
disappeared. The Lithuanian State was revived in 1918 and its in
dependence recognized in 1920. The population of some 2,000,000
was then predominantly rural and remained so as late as 1936. The
newly created Government at once began agrarian reforms. It
abolished the common pasture lands and peasants' “ servitudes," it
consolidated the peasants' strip and plot holdings, and cut up the
large estates for the benefit of the landless peasants.
A network of cooperatives for the supply of credit, consumption
goods, and the purchase and marketing of agricultural supplies was
extended through private and Government efforts. Government
leaders were the real organizers of whole parts of the cooperative
.movement and some enterprises were subsidized or partially owned
by the Government from the early years of independence, tnough it
was stated as late as 1936 that the State hoped to convert these into
genuine cooperatives. Cooperative accounts were audited by Govern
ment officials. Consumers' cooperatives with less than 50,000 lits
capital were exempted from the payment of the trade tax and their
federations with a capital exceeding 50,000 lits from the profits' tax.
In addition, the State maintained, at the agricultural college at Dotnuva, a lecturer on agricultural cooperation. Cooperative delegates
were specially provided for in the Chamber of Commerce, Industry,
and Trade created in July 1936.8
8 S ou rces .—The report on Latvia is based upon data from the following publications: Valsts Statistiskft
Parvalde, Latvijas Statistikas Qada OrSmata (Riga), 1939; International Directory of Cooperative Organi
zations (International Labor Office), 1929,1933,1936,1939; European Conference on Rural Life, 1939: Latvia
(League of Nations Publications, 1939); International Cooperative Bulletin (International Cooperative
Alliance, London), May-June 1922; Review of International Cooperation (International Cooperative
Alliance, London), March 1928, August and December 1929; November 1931; February 1934; December
1936; June, July, and December 1938; People’s Yearbook (English Cooperative Wholesale Society, Man
chester, England), 1934,1940; The Cooperative Systems of Scandinavia and Baltic States (U. S. Bureau of
Foreign and Domestic Commerce, Special Circular No. 372, Washington, D . O., September 15, 1936); and
New International Yearbook (Funk & Wagnalls Co., New York), 1943.
161
Lithuania
By the beginning of World War II the cooperative movement was
a powerful factor m the economy of Lithuania, and its cooperative
wholesale the largest business enterprise there. About a third of the
people were served by the consumers, cooperatives.
T ypes o f Associations
The characteristic types of cooperatives which developed in Lithu
ania were the trading (village and urban consumers’ cooperatives
which both purchased and sold goods), the credit, the dairy, the
agricultural improvement, and miscellaneous associations including
workers’ productive, building, and insurance cooperatives. From
table 50, which presents the numbers of cooperative organizations
existing in 1923, 1928, 1933 and in the last years before World War II,
it is apparent that credit and “ other marketing” cooperatives had the
most consistent growth of all.
The Central Committee of Lithuanian Cooperative Associations
served as a common center for issuing publications, for organizing
propaganda and education, and as an advisory committee for afl
forms of cooperation. This council was reorganized in 1937T
able
50.— Num ber o f Cooperatives in Lithuania in Specified Years, 1923 to 1939,
by T yp e
Type of association
1923
1928
1933
1937
1938
1939
All types
717
1,559
1,405
1,257
1,288
1,332
OoTHSUTnArs’ assnHfttinns
Credit ATld fiavings j^ssonifttions ,,
Building associations..._________ _____________ . . . __
Insurance associations_________________________ - __ _
Publishing associations______________________________
Tifvb^r ass^eifttinns
__ _ _ ...........
PrnHnof.ivA fi«nf>i'nt.inns
Agricultural associations:
Dairy ___________ . . . . . . . . . . . . . . . . . . . . . . . . . ______
Other marketing_______ . . . __ ___ . . . ____ . . . . ___
422
222
409
496
5
1
11
9
32
105
509
4
1
5
7
5
57
407
4
1
2
4
4
1251
398
*275
401
2
2
228
224
386
186
8
16
322
195
136
15
101
224
204
204
12
133
1
409
430
Bee culture__________ . . . . . . . . . __ _________ ___ _
Machinery loan___________ ___ ____ ______ _____
Potato-alcohol distilleries________________________
45
28
i “ Commercial” includes some agricultural.
Cooperative credit associations.— The cooperative credit movement
began in Lithuania with the founding of a credit bank in 1873. After
losses during World War I, the cooperative organizations were re
vived and subsequently advanced much of the funds required for the
restoration of the country and the modernization of agriculture.
The cooperative credit movement was composed of two groups of
associations, each with its own central organization— the rural credit
associations of which the membership in 1931 was more than 50 per
cent agricultural, and the urban credit associations (including the
Jewish People’s Banks) the members of which were chiefly town
dwellers. The Raiffeisen credit cooperatives of the Memel district
also had their own federation, the Raiffeisen Bank, founded in 1924.
It was registered as a joint stock company of which the main share
holders were the cooperatives.
Although the number of Lithuanian credit cooperatives reached 547
in 1927 and had decreased to some 400 at the beginning of World War
162
Cooperatives in Individual Countries
II, total share capital, deposits, loans, and net earnings showed a
steady growth from 1935 to 1938.
1935
(lits)
Own capital...............................
17, 672, 798
Deposits................................................ 30, 003, 371
Loans______________
58, 359, 969
Net earnings______________________
444,020
1937
(Ills )
21, 278, 908
41, 423, 953
65, 900, 104
776,062
1938
(lits)
22, 177, 568
42, 677, 547
69, 602, 315
__________
The Lithuanian Government held shares in the Lithuanian Coopera
tive Bank (the central organization for the majority of the associa
tions) which was founded in 1920 and brought under Government
control in 1933. This Bank supervised the operations of the affiliated
credit cooperatives. At the beginning of 1937, the affiliates of the
Cooperative Bank consisted of 3 federations, 13 trading, and 163 credit
cooperatives. The Bank’s share capital, of which the State held
{>art, then stood at 3,000,000 lits, its deposits at 6,560,000 lits, and
oans granted at 15,900,000 lits.
At the end of 1936, the 41 Raiffeisen cooperatives in the Memel
district had funds of 8,730,000 lits (as compared with 20,130,000 lits
in 1931) and loans granted amounting to 16,640,000 lits (as compared
with 24,960,000 in 1931).
The Jewish People’s Banks numbered 85 with a membership of
15,849 at the beginning of 1937. Own capital amounted to 3,350,000
lits, loans to 14,060,000 lits, and deposits to 14,730,000 lits.
Cooperative association for bookselling.—A cooperative association for
publishing and bookselling was founded in 1923 and by 1936 had be
come the largest enterprise of the sort in Lithuania. The range of this
cooperative’s activities was wide and novel and undoubtedly valuable
in the development of the native culture. It dealt in all kinds of
apparatus (radios, theodolites, typewriters, etc.), and it issued a great
variety of educational material, including a Lithuanian encyclopedia
of which 4 out of 16 volumes had been completed by 1936.
Development o f Trading Cooperatives
During the first few years of Lithuanian independence the cooper
ative movement was organized with separate consumers’ associations
and agricultural purchase and sale associations, but their operations
were almost the same. As dairy farming and stock breeding spread
and the organization of industries to utilize agricultural products
developed, the number of cooperatives increased rapidly. The result
ant overlapping of organizations encouraged the consumers’ and the
purchase and sale cooperatives (of which the members were often the
same individuals) each to extend operations into the other’s field and
ultimately brought about the failure of some consumers’ cooperatives.
Clarification of the fields of activities of the various cooperatives
came largely from above. The Central Union of Cooperative Associa
Lithuania
163
tions (Lietukis) was formed through the efforts of Government officials
in 1923, and its affiliated associations included consumers’, agricultural,
credit, and dairy cooperatives. Its original function was largely that
of education. The credit groups soon withdrew to join their own cen
tral organization, as did also the cattle-registration groups. In 1926
the dairy cooperatives also formed a separate central union, called
Pienocentras. About the same time, the educational work of Lietukis
was transferred to the newly incorporated Chamber of Agriculture.
The final demarcation of activities occurred in 1930 and 1931 when an
arrangement worked out between Lietukis and Pienocentras trans
formed the agricultural purchase and sale cooperatives and the con
sumers’ cooperatives (except cooperatives which were clearly urban)
into a uniform type of rural association which became distinctive in
Lithuania— the “ trading” cooperative association. These trading
cooperatives handled ordinary consumer goods such as groceries as
well as farm supplies, and they also purchased agricultural produce.
Lietukis then began to act as the central union and wholesale for the
trading cooperatives and henceforward its aim was declared to be the
development and organization of the trade in agricultural products
and the reconciliation of the interests of producer and consumer.
Since there were only about 20 of the traditional types of consumers’
cooperatives in Lithuania and these had no cooperative wholesale of
their own, the activities of Lietukis constituted the main cooperative
wholesale business. During this early period a wholesale known as the
Christian Cooperative Wholesale was liquidated (in 1928). A second
wholesale organization was absorbed by Lietukis at the beginning of
1931.
In the decade preceding World War II, Government participation in
cooperative enterprise continued, and even increased, through its part
ownership of certain joint stock companies. During this period a
decline in membership began in the depression in 1932, and continued
year by year throughout the 1930’s, whereas after 1934 sales and net
earnings grew at the rate of 10,000,000 lits and 200,000 fits respectively
a year (table 51). The decrease in individual membership appears to
have been accompanied by the opening of cooperative facilities to the
public, for the increase in sales (from 52,255,099 fits in 1929 to
114,285,259 fits in 1939) could scarcely be explained by a rise in prices
and m member purchases. The remarkable decrease in the amount of
members’ share capital after 1933 is also significant.
By 1938 (the last full year of peace) Lithuania had 183 agricultural
and rural consumers’ or trading cooperative associations, with a mem
bership of 23,480, sales valued at 95,164,700 fits, and own capital
of 8,200,000 fits. Credit cooperatives numbered 398, of which the
membership was 117,155, the capital 13,990,000 fits, the deposits
41,670,000 fits, and the loans 63,570,000 fits. ^
Cooperative expansion continued in 1939, with the membership in
agricultural and rural consumers’ associations increasing 17.3 percent,
the number of stores increasing from 310 to 452, and the amount of
turnover from 40,400,000 to 56,100,000 fits.
164
Cooperatives in Individual Countries
T a b le 51.— D evelopm ent o f Consumers* Trading Cooperatives in Lithuania , 1925-39
[For par values of currency, see Appendix table, p 278]
Num
ber of
co
opera
tives
Year
1Q9J?
1926
Membership
Total
Farm
ers
Num
ber of
stores
Amount of
business
Net
earnings
Lits
L its
Share
capital
Lits
Reserves
L its
20,631,975
23,524,254
52,255,099
676,886
389,419
490,965
514,571
764,649
2,154,606
2,198,589
1,481,023
2,584,886
1,168,653
509,780
543,604
634,460
741,265
1,182,894
44,992,836
46,003,579
37,314,464
37,534,228
37,342,382
875,390
605,198
288,667
413,223
483,091
1,177,891
1,112,116
877,987
1,029,014
880,582
1,330,548
1,444,172
1,138,053
1,387,342
1,301,826
290 46,427,654
298 55,562,955
316 65,045,674
334 95,164,700
378 114,285,259
680,448
821,248
1,042,931
1,374,775
2,277,009
759,150
725,775
916,804
693,901
673,233
1,246,263
1,451,830
1,628,956
1,975,432
417,770
1927..............................
1928..............................
1929..............................
247
208
205
223
259
37,641
36,875
38,891
22,792
25,077
288
318
1930..............................
1931..............................
1932..............................
1933..............................
1934..............................
254
213
185
184
176
23,841
33,993
28,747
26,087
22,285
23,486
22,399
18,330
16,074
13,890
313
294
271
284
284
1935..............................
1936..............................
1937..............................
1938..............................
1939..............................
171
180
182
183
185
20,906
21,026
21,525
23,480
25,189
12,835
13,118
13,352
14,701
16,499
The largest Lithuanian consumers’ cooperative was Parama, at
Kaunas, which in 1937 had 30 stores. Like other Lithuanian cooper
atives, in the late 1930’s Parama encouraged all patrons to become
members, at one time announcing that all nonmember customers
whose purchases exceeded 1,000 lits might join the association with
out paying the usual fees. In 1936 Parama maintained a bakery with
a daily capacity of 50,000 kilos— the largest in the Baltic States.
At that time the daily needs of Kaunas were 40,000 kilos and the out
put of Parama 20,000 kilos of bakery goods.
ACTIVITIES OF COOPERATIVE WHOLESALE, LIETUKIS
After 1930 Lietukis divided its attention between supplying its
member associations with consumer goods and farm supplies and the
marketing of flax and grain. The two main divisions of its trading
activities were the import of commodities needed by the members
and the purchase and export of farm produce. The wholesale also
provided accounting service, besides assisting member associations
on matters of finance and real estate. Only about 20 percent of its
affiliates were consumers’ cooperatives in 1936 and 80 percent were
agricultural cooperatives. In 1939 Lietukis had 145 affiliates with
a total individual membership of 25,000. The Central Union and
Wholesale might thus be said to serve about 100,000 persons out of a
total population of some 2,000,000.
Lietukis was handling about 85 percent of the total Lithuanian
wholesale trade in sugar, 76 percent of the salt, 80 percent of the
agricultural machinery, 60 percent of the cement, and all of the
fertilizer. The machinery department also handled automobiles,
bicycles, and sewing machines. Groceries and building materials
were important items of Lietukis’ turnover. Its petroleum trade
expanded after 1936 when it acquired a number of storage tanks at
Memel; in 1938 its imports of petroleum products constituted 42
percent of the total imports of these items. In 1939, Lietukis was
the only exporter of, and the largest dealer in, cereals in Lithuania,
165
Lithuania
and handled 45 percent of the total national flax export. By acquir
ing grain mills in the late 1930’s, Lietukis was able not only to regulate
flour prices but also to purchase in quantities sufficient to influence
grain prices.
Lietukis collaborated with the dairy union, Pienocentras, in the
manufacture of soaps, oils, polishes, and lubricants, and with the
Government in the operation of Maistas, a joint stock meat-packing
company (founded in 1923 on an earlier cooperative beginning).
In the mid-1930’s, Maistas maintained 4 processing plants and 50
retail stores and the Government apparently hoped to convert the
enterprise into a purely cooperative association.
From sales of about 32,000,000 lits in 1933, Lietukis increased its
business more than fourfold by 1939, as table 52 indicates. The single
break in its consistent growth occurred in 1937.
T a b l e 52. — M em bership and Operations o f Central Union o f Lithuanian Cooperative
A ssociations , Lietukis , 1933-39
[For par values of currency, see Appendix table, p. 278]
Year
1033
...
...
_____
1934..........................................................
1935..........................................................
1936..........................................................
1937...........................................................
1938..........................................................
1039
Number
of affili
ated asso
ciations
Amount of
business
Net
earnings
Share
capital
Reserves
Lits
Lits
Lits
140
127
112
108
111
131
145
Lits
32,063,457
37,616,700
60,530,300
73,714,500
72,360,000
113,908,900
138,911,000
0)
83,100
382,900
640,600
776,800
957,500
1,147,700
0)
289.100
272,200
375,400
505.900
705.900
915.100
0
361,300
331,200
350,400
529, 700
568,500
807,900
1No data.
Lithuanian Cooperatives in W orld W ar I I
On March 22, 1939, the Lithuanian cooperatives suffered the first of
many losses caused by World War II, with the cession of Klaipeda
(Memel) to Germany. Following the Mutual Assistance Pact signed
with the Soviet Union, October 10, 1939, Lithuania received its former
capital, Vilna. Soviet troops occupied the country on June 15, 1940,
and on July 21, the Lithuanian Parliament adopted a resolution for
union with the U. S. S. R., which was accepted in Moscow on August 3.
When Germany attacked Russia, Lithuanian patriots established an
independent government at Kaunas, June 23, 1941. The Germans
dissolved this government on August 6, and made Lithuania a district
in the Ostland Province of the Reich under a German commissioner
general.
Though the Russian policy for the Baltic republics included the
nationalization of land, farms less than 45 acres in size were left in the
hands of the small owners and only the larger properties were placed
under State administration.
After the German occupation of Lithuania began, the Germans
appointed their own administrators for the large farms and treated the
small farmers as holders of German State property. The formation
of a central German organization to “ manage and exploit all the State
farms and their technical enterprises such as machine and tractor
166
Cooperatives in Individual Countries
stations, also certain collective farms and other agricultural enter
prises singled out by the Reich Commissioner,, was announced
February 14, 1942. Raw materials and food were confiscated for
German use. At least one of the joint stock companies affiliated to
the Lithuanian cooperative movement was made a branch of the
German organization in the same field of production.
At the same time, the Germans were giving seized Lithuanian prop
erty to German-speaking Balts who were being returned to Germanize
the Baltic States, and 70,000 Lithuanians were moved to the Reich to
work.4
Countries o f Central and Eastern Europe
In all of the countries of central and eastern Europe—Austria,
Czechoslovakia, Germany, Hungary, Poland, and Soviet Union— the
cooperative movement had reached impressive proportions and was
an important factor in the life of the people. In Germany the con
sumers’ cooperatives were serving about 25 percent of the population,
in Czechoslovakia 30 percent, in Poland 40 percent, and in Hungary
45 percent.
The advent of Hitler and the gradual rise of totalitarianism changed
the situation in five of these countries within a few years. In every
case it was the consumers’ cooperative movement which was the main
target of attack, the agricultural cooperatives being left for the most
part unmolested. In Germany an avowed program of dissolution of
the consumers’ cooperatives was adopted by the Nazis. Such was the
cooperatives’ position in the economy of the people, however, that
nearly a decade elapsed before the program could be carried out in its
entirety, resulting in the disappearance of this form of cooperative.
In Austria internal difficulties, added to the depression and the in
volved financial difficulties of the Government itself, had produced
knotty problems for the cooperative movement which it was only
beginning to solve when the political crisis of February 1934 occurred,
resulting in the adoption of totalitarian policies. After the Anschluss
with Germany and the assumption of power by the Nazis, the Austrian
cooperatives suffered a fate similar to that of the German associations.
In Czechoslovakia a drastic policy of amalgamation and dissolution of
consumers’ cooperatives was inaugurated almost as soon as the German
invaders arrived in 1939, the outcome of which the outside world has
not been permitted to learn. A large proportion of the cooperatives
in Poland were dissolved or destroyed in or after the partition of its
territory among Russia, Lithuania, and Germany. Reports from
German-occupied territory indicate that the Germans have made use
of cooperative facilities and have even encouraged the formation of
new associations where this suited their purposes.
4 S o u rc e s — T h e report on Lithuania is based upon data from the following publications: Lietuvos
Statistikos Metrastis (Centralinis Statistikos Biuras, Kaunas), 1931, 1936, 1938 (Vima) 1939; International
Directory of Cooperative Organizations (International Labor Office), 1929, 1933,1936, 1939; European Con
ference on Rural Life, 1939: Lithuania (League of Nations Publications, 1939); Review of International
Cooperation (International Cooperative Alliance, London), June 1928, July 1931, September 1932, Novem
ber 1933, September and October 1936, September 1937, October 1938, September 1939, and January
1940; The Cooperative Systems of Scandinavia and Baltic States (U. S. Bureau of Foreign and Domestic
Commerce, Special Circular No. 372, Washington, D. C., September 15, 1936); People’s Yearbook
(English Cooperative Wholesale Society, Manchester, England), 1931, 1932. 1940, 1941;New International
Yearbook (Funk & Wagnalls Co., New York, 1943); Cooperative Review (Cooperative Union, Ltd.
Manchester, England), March 1942; Washington Post, February 14,1944.
Austria
167
Among these five countries, the cooperative movement of Hungary
alone received actual advantages from the war, profiting by the
addition of associations in the territories reannexed (after 20 years)
from Czechoslovakia, Rumania, and Yugoslavia.
Cooperative Movement in Austria
In the 60-year existence of the Austrian cooperative movement,
Austria passed through practically the whole cycle of modem political
and economic development—the Imperial Government until 1918, the
Austrian Federal Republic, 1918-34, the Austrian Corporative State,
1934-38, and the German Reich since 1938. When the first coopera
tive associations were founded before the 1890’s, the landholding
classes and the craft guilds of the Empire held almost medieval power.
Changes caused by the beginning of industrialization and political
enlightenment appeared in the old Empire before World War I.
In the new Republic, the connection between the political leadership
of the National Government and the management of the cooperative
societies was close. Cooperative associations acted with the State or
with municipal bodies in the management of socialized enterprises.
A series of crises, however, had followed the dismemberment of the
Empire in 1918-19 and the subsequent collapse of the Austrian cur
rency. In the consequent readjustment, legislation was passed which
limited the privileges of the consumers’ cooperative societies. In the
winter of 1933-34, when Austria was drawn into the backwash from
the German National Socialist revolution, a combination of groups
established the corporative form of government in Austria.
For a time, the new government took over almost complete control
of the cooperative associations, destroying their democratic machinery
at one stroke. Cooperative circles included so much of the nation’s
talent, however, that the committees appointed by the Government in
1934 to administer the movement were almost invariably headed by its
friends. Within One year after the winter revolution of 1934 the co
operative societies^ except the Workers’ Bank (Arbeiterbank), had
resumed their busmess. Government control of economic life con
tinued to increase until the Anschluss with Germany in 1938. After
that event, German influence did not destroy the cooperative structure
immediately. The consumers’ societies were “adjusted.” Three years
later, on February 18, 1941, a German Reich decree announced that
the “assets, properties and organization of the Austrian societies
affiliated to the Zentralverband [Union of Austrian Distributive
Societies], as well as those of the Wholesale Society with headquarters
in Vienna, are to be handed over to, managed by, or disposed of by the
Labor Front.” Throughout the changes of the 1930’s, the agricultural
cooperative societies survived virtually untouched by regulation.
Their fate since the Anschluss is not known, but for other sections of
the cooperative movement the cycle from autocratic control through
liberty and back to authoritarian control was complete. At their
peak; the consumers’ cooperatives had been responsible for the
provisioning of at least a thud of the population of Austria.
168
Cooperatives in Individual Countries
T yp es o f Associations
Austria had almost every form of cooperative association and
excelled in some. Before World War I, the chief development was in
Raiffeisen banks and agricultural cooperation, but most of these
organizations were in the regions lost to Austria under the peace
treaty. After the war the agricultural associations steadily increased
in number. The consumers' cooperatives, on the other hand, just as
steadily decreased, this being largely due to the policy of amalgama
tion oi smaller associations into powerful district associations. The
consumers' cooperatives were predominantly working-class organiza
tions, although some associations of peasants and other groups also
existed. Insurance was provided for the consumers' cooperative
movement through a single organization, the Insurers' Protection
Bureau (a subsidiary of the Central Cooperative Union).
T a b l e 53.— N um ber o f Cooperatives in A ustria in Specified Years, by T ype
Type of association
1910
1913
1919
1925
1929
1930
1934
All types............................................................
16,468
19,091
3,870
5,014
5,430
5,372
5,845
Credit associations.......................................... 10.890
Schulze-Delitzsch......................................
(9
Raiffeisen....................................................
(9
Consumers’ associations.................................
1,361
Agricultural associations...............................
2,887
964
Industrial and professional associations___
Building (housing) associations....................
312
Other associations............................................
54
12,240
1,980
(9
(9
(9
(9
2,148
473
1,675
375
1,333
865
.252
41
2,303
545
1,758
322
1,674
803
293
35
2,308
545
1,763
302
1,672
757
300
33
2,424
611
1,813
234
2,067
805
299
16
1,451
3,511
1,216
616
57
321
900
524
121
24
1936
t
5,478
2,205
379
1,826
222
1,998
749
290
14
1 No data.
The Austrian registry of cooperatives showed 312 housing associa
tions in existence at the end of the year 1910. Of this total, 176 had
been established within the year. This growth continued during the
Balkan Wars. Though all cooperatives increased 10 percent in
number during the year 1911, the increase among the housing associa
tions was 56.4 percent. The latter numbered 482 in 1911, and 616
in 1913. During the first year of World War I— 1915— the housing
associations founded a federation, the Austrian Union for Workmen's
Houses and Allotments, which survived World War I and the vicissi
tudes of the Federal Republic. The most recent membership figures
available for the federation are shown below:
N um ber
1929_______________
236
1933_______________
241
1936
______ _________________________ - 339
1937
____________
290
M em bership
30, 180
34,800
33,300
38, 711
Austrian agricultural cooperative associations were organized into
16 provincial unions and 1 central union, the General Union of
Austrian Agricultural Cooperative Societies (Allgemeiner Verband fu r
das landmrtschaftliche Genossenschaftswesen in Osterreich). In 1934
the membership of the 3,617 local associations which made up these
unions was approximately 408,000. The influence of the agricultural
cooperatives in Austrian economic life, however, was far greater than
these numbers suggested.
Electricity cooperatives had made a beginning with 27 associations
and a balance-sheet total of 916,000 francs in 1937
169
Austria
In the same year the number of urban credit associations reached
332, their membership was 157,324 and their total turnover was
165,048,000 francs. About two-thirds of the credit associations were
Raiffeisen associations among the farmers. The trend of development
of these associations during the difficult years from 1931 to 1936 is
shown in table 54.
T
a b l e
54.— D eposits and Loans o f R aiffeisen A ssociations in A ustria , 1931—36
[For par values of currency, see Appendix table, p. -278]
Year
1931............................................................................................
1932.............................................................................................
1933 ........................................................................................
1934 ........................................................................................
1936.............................................................................................
Number of
associations
1,792
1,796
1,804
1,816
1,839
Deposits
Loans
Schillings
Schillings
318,700,000
305,000,000
316,200,000
332,700,000
316,535,000
289,100,000>
274,600,000
276,200,000
267,800,000
1534, 705,000
i Total turnover.
Development o f Consumers* Cooperatives
Though a consumers’ cooperative association was founded at Teesdorf in Austria as early as 1856, and cooperative associations began to
spread after the formation of the Vienna Consumers’ Society in 1864,
the Austrian cooperative movement did not develop as speedily as
the parallel movement in Germany. The power of the long-estab
lished craft guilds and bourgeoisie and the division of the cooperatives
into eight rival groups, as well as the late appearance of the industrial
revolution, all retarded the growth of Austrian cooperatives. In
1873, when the first law for cooperatives was passed, only 169 associa
tions were in existence in Austria. In spite of this small total, a
federation— the General Union of Self-Help Trading and Economic
Societies—had been created in 1872. 'Consumers’ cooperatives were
the principal supporters of this union, but it admitted all types of
associations. For the next 20 years the movement grew slowly. By
1910, however, there were 1,361 distributive associations and 312
building cooperatives.
The General Union had been the only cooperative federation in
Austria for 30 years when, in 1901, a group of its member associations
withdrew to form the Union of Austrian Workers’ Trading and Eco
nomic Societies (Verband der Arbeiter-Erwerbs und M irfschaftsgenos*
senschaften Osterreichs). Three years later, the consumers’ cooper
atives from the seceding group joined the consumers’ associations
which had remained in the General Union and formed the Central
Union of Austrian Consumers’ Societies (Zentralverband ozterreichischer Konsumvereine). Under various names, the Zentralverband had
a continuous existence until the German Reich absorbed Austria in
1938.
The depleted General Union continued under the name
Osterreichischer Genossenschaftsverband until at least 1938, its mem
bership consisting of credit associations on the Schulze-Delitzsch plan.
Although the attitude of the Imperial Government toward the co
operative movement had been more or less hostile, by the time the
Balkan Wars brought unemployment and a disruption of Austro588544°— 44------ 12
170
Cooperatives in Individual Countries
Hungarian economy, the Central Union has established itself under
strong leadership. In 1905 another forward step was taken with the
formation of the Wholesale Society of Austrian Consumers’ Cooper
atives (Grosseinkaufsgesellschaft osterreichiseher Consumvereine, known
as “ GoC” ), as a subsidiary to the Central Union. Its bylaws provided
that 30 percent of its earnings were to go into a productive fund and
10 percent to reserves. It accepted savings deposits from trade-unions
as well as cooperative associations. The wholesale’s principal ware
houses were in Vienna but even before World War I it had opened
others in Moravia, Ostrau, Aussig, Briinn, and Trieste.
WORLD WAR I AND EARLY POST-WAR PERIOD
Conditions during World War I and the post-war readjustment
period encouraged the development of cooperatives in Austria. Dim
ing the war, weaknesses in the economic and political system forced
the Imperial Government and the people themselves to rely for dis
tribution and even supply on such organizations as the trade-unions
and cooperative associations.
When the Imperial Government developed plans for supplying the
war workers, a new cooperative organization— the Victualling Union
of War Workers—was formed, the members of which were the tradeunions, the employers in the industrial establishments involved, and
the Wholesale Society, GoC. More than 400 industrial enterprises,
employing 200,000 workers, had joined the Victualling Union by 1917.
The main responsibility for the distribution of food fell upon GoC,
which supplied the needs of 400 industrial enterprises and 575,000
persons (one-third of the wartime population of Vienna).
The terms of the treaty of St. Germain (ratified October 17, 1919),
creating Yugoslavia, Czechoslovakia, Hungary, and Poland and recti
fying other national boundaries, left the new Austria with only about
one-fourth of its former land and resources. The total number of
cooperative associations dropped to 3,870 in 1919— a reduction of
almost four-fifths from the 19,091 in Austria in 1913. Of the credit
associations only about a sixth of the pre-war total remained in
Austrian territory. Consumers’ , agricultural, and building associa
tions each lost between three-fourths and four-fifths of their member
groups.
The Federal Kepublic of Austria was established in mid-November
1918, birth and class privileges were abolished, and a revolutionary
socialization of industry was soon under way. At the same time, na
tional industries whicJi once supplied an internal market of 50 million
people were compelled, by the territorial changes mentioned above,
to contract themselves to a market of 5,500,000, and that at a time
when thousands of demobilized army and civil personnel were enter
ing industry for a living. Although wartime controls—notably ration
ing—were continued, the break-down of the supply system compelled
the Government to turn to the cooperatives for the service of distri
bution. For a time in 1918, the crisis was severe; Vienna had but
10 days’ supplies on hand and all distributive cooperatives suffered
from looting. The public flocked to the associations; membership in
the Central Union’s affiliates'rose from some 300,000 to about 371,000
and the increase would have been even greater had the associations
not been forced to prohibit new admissions because of the scarcity
Austria
171
of provisions. In 1920, GoC was supplying foodstuffs to one-third
of Austria’s 6,000,000 people. Though individual membership de
clined slightly as private shops began to open after the peace, the
total membership in 1922 was 145,165 larger than before the war.
This growth was due partly to encouragement by Social-Democratic
Party leaders, partly to the cooperative associations’ collaboration
with the trade-unions, and partly to economic conditions.
The Distributive Society of Vienna and District was the largest in
Austria and the best customer of GoC. It was formed in 1919 by
a merger of existing associations. At the end of its first year it had
140,541 members, and a total turnover of 700,745,436 kronen. It
employed more than 1,560 persons and, besides its stores, operated a
bakery, saddlery, smithy, butchery, and dairy. It had established a
publicity department and library, and its stores numbered 158.
By the end of 1919 all cooperative associations, as well as other
Austrian enterprises, were facing ruin in the inflation which led to the
collapse of the Austrian currency. Because of the inflation, the need
for increased working capital was continuous. Associations ceased
payment of patronage refunds, allocated large sums tQ reserves, and
increased the value of shares. The distributive cooperatives violated
the Kochdale cash-sale principle and began to buy on credit; they also
accepted credit of IK billion kronen from the State; and they encour
aged members to increase their shares and savings deposits.
In 1922, the Central Union held no congress and made no printed
report. League of Nations’ loans had been made to Austria, but the
Austrian people were still suffering from unemployment and under
nourishment. Flour prices had gone up to 53,571 percent, pork
74,418 percent, lard 87,766 percent, and rice 105,822 percent above
the pre-war prices.
ACTIVITIES OF COOPERATIVE WHOLESALE AND CENTRAL UNION
During the next few years, when the very existence of Austria as a
nation was at stake, the wholesale participated in the reconstruction
of wartime organizations, some municipal, some trade-union, and some
industrial. Either alone or in conjunction with the city of Vienna or
the National Government it formed companies for the production and
distribution of fuel, food, wearing apparel, household goods, and farm
articles and for the exportation of Austrian and the importation of
foreign goods. In this way it acted with the municipality to buy
and distribute coal from Czechoslovakia, fruit, vegetables, and meat.
It participated with the Federal Government and the agricultural
cooperative wholesale in an organization to buy raw cotton, which was
then worked up by priviate factories and returned to the wholesales
for sale through special cooperatives; and it participated with the State
in the shoe and leather business. Acting independently it bought,
cut, and sold fuel wood, bought or leased factories to make clothing,
rubber, soap, bakery goods, and vermicelli. It participated with the
trade-unions in the organization of the Labor Bank (Arbeiterbank),
some of the funds of which helped to finance certain of the abovementioned enterprises.
All these developments occurred in the years of inflation when the
mere survival of the wholesale was remarkable. Even GoC itself
did not claim that this survival would have been possible without
172
Cooperatives in Individual Countries
the support of the trade-unions, the friendship of the Social-Demo
cratic Party, and the orders received from the municipality of Vienna.
Of the various enterprises in which the wholesale participated, two
of the most interesting were the Labor Bank and the Aus tro-Russian
Trading Co.
Labor Bank (Arbeiterbank).— The Labor Bank opened January 1,
1923, as a joint stock company, since Austrian law did not permit its
organization as a cooperative. It was organized to act as a “ financial
intermediary” among the trade-unions, cooperative associations, and
the Social-Democratic Party.
In its first 10 years of operation its resources and business showed a
continuous expansion until the onset of the depression, as the accom
panying tabulation indicates.
Share capital
(schillings)
1923 ...............................
1924 _________________
____________
1925
1929.
1930_________________
1931.
.................
1932. - ...............
1,
2,
4,
4,
4,
200,000
500,000
000, 000
500, 000
000, 000
000, 000
000, 000
Total deposits
(schillings)
4 ,4 5 5 ,3 7 3
13,894,186
22, 276, 353
53, 276, 444
59, 118, 808
56, 203, 541
54, 313, 678
Reserves
(schillings)
68,715
198,688
432, 358
2, 089,000
3, 528,000
3, 810,000
4, 140,000
The bank received deposits not only from various workers’ organiza
tions but also from individuals. Its loans were made to workers’
child welfare groups, industrial workers’ housing associations, munic
ipalities, and public utilities. It financed much of the wholesale’s
expansion mentioned above, and it was also active in the development
of the Austro-Russian Trading Co.
Austro-Russian Trading Co. (Ratao).— The Austro-Russian Trad
ing Co. was a result of the Austrian desire to replace some of the
losses suffered from the Peace Treaty by finding markets and supplies
in the East. In 1923 certain Austrian economic institutions led by
representatives from the former “ Arsenal” arms factory (then manu
facturing agricultural machinery) sent a delegation to Russia em
powered to make a trade agreement on the spot. The result was a
complicated organization— Ratao—in which the Austrian financing
agents were the Cooperative Wholesale Society (GoC) and the
Industrial Bank, and the Russian financing agents were the Russian
State and the cooperative societies. When the financial crisis of
1924-25 endangered the Industrial Bank, the Labor Bank took over
the Industrial Bank’s responsibilities; the Austrian Arbeiterbank
and the Cooperative Wholesale then became the only Austrian
members of Ratao, with GoC taking over its management. During
its first 9 months, Ratao’s exports to Russia were valued at 3,235,000
rubles, its imports from Russia at 2,990,000 rubles. Austrian industrial
articles worth 7,600,000 schillings were sent to Russia in 1927-28
and foodstuffs worth 1,400,000 schillings were received from Russia.
In the calendar year 1928, the Austro-Russian Trading Co.’s turn
over reached 63,965,884 schillings.
1926-30
In the late 1920’s, Austrian cooperative returns showed the results
of the various enterprises begun by the wholesale. Both productive
output and sales increased markedly. Under direct-delivery arrange
ments to save handling of goods, 63 percent of its products went
from factories to associations without entering its warehouses.
PERIOD OF RECOVERY,
173
Austria
By 1929, the wholesale’s annual turnover amounted to 95,239,273
schillings and the group of Central Union affiliates had become the
most important commercial enterprise in Austria. The Central
Union meanwhile began educational courses for members and took on
specially trained auditors. In 1930 the associations affiliated with
the Central Union were distributed, by type, as follows:
N um ber
C onsum ers’ a ssocia tion s__________________________________117
P rod u ctive a ssocia tion s__________________________________
38
B uilding, housing, an d settlem ent a ssocia tion s_________
34
W ork ers’ h om es_______________________________,_________
15
C redit association s_________________________
C o op era tiv e depa rtm en t stores__________________________
10
U nions an d oth er kinds o f societies_____________________
11
D epression and the Corporative State, 1 9 3 0 -3 8
Austrian consumers’ associations withstood better than private
enterprise the world-wide depression which broke in 1929. By 1931,
when 108 private businesses in Vienna alone had gone into either
liquidation or bankruptcy, not a cooperative store had been closed.
Whereas purchasing power had dropped by 25 to 30 percent in 1931,
the sales of the associations affiliated to GoC fell ordy 6% percent.
Reserves, cash on hand, and share capital had increased.
When the economic crisis became more severe in 1932 and 1933,
the cooperative associations had funds sufficient to meet all their
depositors’ calls for repayment. In 1932, however, the savings deposits
represented over 40 percent of the aggregate liabilities of the Central
Union’s affiliated associations and the problem of ultimate liquidity
had even then been raised.
The wholesale’s returns ran parallel with those of the local associa
tions. After reaching a peak business of 95,239,273 schillings in 1929,
the volume fell in 1930 to 91,854,806 schillings and in 1931 to 89,582,534
schillings.
As the crisis reached its height in 1934, GoC’s total turnover
amounted to only 65,664,355 schillings—a decline of 13.6 percent
since 1933. Much of this drop was accounted for by the wholesale’s
declining textile business. Austrians were making or remaking their
clothes at home and the GoC clothing factory had to be closed.
Private traders who had not profited from the semisocialized enter
prises of the Federal Republic began attacks upon the consumers’
cooperative associations soon after such enterprises began. These
attacks increased in intensity in the prosperous years of 1928 and
1929 and continued in 1931, 1932, and 1933. Consumers’ associations
which sold foodstuffs and household goods were entitled by law to
deduct 1 percent from the surplus and pay a 12-percent tax on the
remainder. Private traders and enemies of the cooperatives generally
were pressing for legislation to exclude from tax exemption all con
sumers’ cooperatives which sold textiles, since these were not house
hold goods. They similarly insisted that the large cooperatives were
actually joint stock companies and should be taxed as such. The
consumer associations’ defense that they were not organized for profit,
as were the private companies, was not successful, although, for a
time, the agricultural cooperatives, through the General Union of
Agricultural Cooperative Societies, used their influence to hold off
legislation against the consumers’ groups.
16
174
Cooperatives in Individual Countries
In the crisis of 1933, Parliament ceased to function and the Govern
ment began to rule by emergency decree. Austrian commercial laws
were amended. By a regulation of March 1933, every trader was
obliged to join the retail dealers’ association and to present to it his
credentials and proof of having served an apprenticeship before open
ing any new branch of his business, before appointing business man
agers, or before being licensed to trade. Since this regulation did not
apply to agricultural cooperatives, the consumer groups felt that they
had been unjustly placed in the power of the private traders. As the
depression grew worse, an Embargo Decree banned new enterprises
in Austria, but the law was applied only to distributive cooperatives.
In May, all consumers’ cooperative surplus, whether in patronage
refunds or in reserves, was made subject to the full profits tax— 12
percent on earnings from sales to members (25 percent in case of non
members) . In November 1933, consumers’ associations were forbidden
to supply State institutions.
The real crisis for the cooperatives came wheh the authoritarian
regime was established under Dr. Dollfuss, and the Social-Democratic
Party, to which most of the cooperative leaders belonged, was dis
solved. Some cooperative leaders were imprisoned and some district
associations— the Distributive Society of Vienna among them—were
placed under Government-appointed administrators and, during the
disorders of February 1934, many cooperative stores were seized.
Small private traders were asking for the complete dissolution of the
consumers’ cooperatives. The influence of the agricultural coopera
tives and the International Cooperative Alliance, as well as the friend
liness of Dr. Dollfuss himself, limited the restriction by a bargain by
which the cooperatives agreed not to increase their membership
beyond that of January 1, 1934, to distribute cooperative propaganda
material only to members, and to discontinue textile production.
The new authoritarian regime had grouped all enterprises, according
to type, into seven organizations: Agriculture, industry, trade, crafts,
finance, liberal professions, and public service. The consumers’ coop
eratives found themselves in the trade group where their old rivals,
the private dealers, held control.
During the crisis of February 1934, police occupied the Labor Bank
(Arbeiterbank) and arrested its principal officials. A law of February
16 provided that the bank be liquidated. Although shareholders’ and
creditors’ rights were completely wiped out by the law, GoC and its
affiliates ultimately won an arrangement whereby the creditors (coop
eratives, trade-unions, and other organizations closely connected with
them) each accepted a proportion of cash and specific assigned assets.
Smaller banks somewhat dependent on the Arbeiterbank in Styria,
Tyrol, Salzburg, Carinthia, and Upper Austria held the savings of
more than 20,000 people. Two of these banks were in sound condi
tion, three were liquidated without loss to depositors. Only in one
bank did creditors suffer losses.
Critics writing in 1935 believed that the Arbeiterbank might have
been safe if it had continued its original policy and merely received and
invested the funds of the cooperative associations and the tradeunions, instead of making investments outside the movement. One
such investment, in a motion-picture company (Kiba) proved to be a
particularly unsound venture. The Arbeiterbank officials were en
deavoring to remove this source of danger when the February crisis
overtook them.
175
Austria
Before the end of 1935, the Government’s temporary administration
of some of the distributive cooperatives (undertaken in 1934) was
withdrawn and the cooperative leaders believed they had been recog
nized as the spokesmen for the Austrian consumers. Autonomy was
restored to the Vienna Distributive Society on January 5, 1935, and a
year later, to the wholesale. The Government committee which had
administered the GoC, acted under the friendly chairmanship of the
leader of the agricultural cooperatives, and in this interval the whole
sale’s business with affiliated associations actually increased. The
wholesale even began operation of a new chemical plant.
The Central Union, which had claimed to be free throughout the
crisis, lost a few member societies in 1936. Individual membership
in its affiliates dropped from 263,037 to 259,404. The business of the
local associations, however, rose in that year from 118,197,000 schil
lings to 120,998,000 schillings, and since the drop in membership was
due almost entirely to the removal of nonpurchasing members from
the lists, it was believed that the financial situation of the Union and
its members had improved.
T
able
55.— M em bership and B usiness o f A ustrian Central Union and W holesale (GoC)
[For par values of currency, see Appendix table, p. 278]
Central Union of Distributive Associations
Affiliated local distributive
associations
Year
1911...........................................................
1912...........................................................
1913..........................................................
1914..........................................................
1 9 1 5 .........................................................:
1919..........................................................
1922..........................................................
1923..........................................................
1925.........................................................
1926..........................................................
1929..........................................................
1930.........................................................
1931..........................................................
1932..........................................................
1933..........................................................
1934........ ........ : .......................................
1935................................................ ... .....
1936..........................................................
Total
Their
members
0)
0)
(9
0)
525
0)
476
112
108
103
130
129
117
115
222
219
208
193
101
99
300,934
0)
314,814
Cooperative Wholesale (Q6C)
Their sales
Amount of
business
Schillings
K ro n en
0)
(9
67,167,155
(9
101,826,509
2,224,049
3,121,832
(9
0)
(9
Value of
own pro
duction
<9
0)
(9
8
K ro n e n
370,866
0)
572,771,278
272,921,985,469
Schillings
481,949
321,014
317, 936
259,932
263,137
(9
0)
0)
(9
263,037
259,404
103,463,940
133,845,977
129,296,085
162,185,551
147, 754,616
347,250,258
139,294,000
129,322,000
115,183,500
118,197,000
120,998,000
486,422,347
194,496,224,034
Schillings
46,656,420
70,770,269
70,112,603
95,239,273
91,854,806
89,582,534
83,054,002
76,276,000
65,664,355
69,498,430
73,616,832
8
Schillings
(9
0)
(9
8
(9
8
29,637,000
29,718,000
(9
i No data.
During 1937, the Union expanded its educational work. Study
circles, tried out in Vienna, were started among the Provincial societies.
A central cooperative training school was established at which 1,790
students enrolled. Plans for 1938 included courses for board and
supervisory council members, apprentices, inspectors, and salesmen.
On the other hand, attacks upon the cooperative organizations
continued. Cooperative leaders maintained that the growing power
of cartels hindered their efforts to control prices in favor of the con
sumer. The 1934 restrictions interfered with the extension of coop
176
Cooperatives in Individual Countries
erative facilities. To protect themselves, the cooperative associations
demanded the removal of the restrictions and the enactment of a law
which would require the registration and supervision of cartels.
Cooperatives Under the N azis
In March 1938, the Germans occupied Austria and brought the
whole network of Austrian consumers* cooperative organizations
(then including 220 associations and 300,000 households) under the
control of a commissioner appointed by the Nazi leaders.
Though the German National Socialists appeared to respect the
integrity of the cooperatives, probably because of the need for appeal
ing to organized workers, the Consumers* Cooperative Congress held
in November 1938 revealed the real revolution which had occurred.
Beginning with July, Nazi-inspired notices issued by Zentralverband
had required that all Jewish members and firms be excluded from the
Union because “ the German cooperative will and the Jewish trading
spirit** were contradictory. More than one-third of all the delegates
at the Congress were uniformed Nazis; many trusted cooperative
leaders failed to attend because of racial exclusion, suicide, or, as the
obituary notice in the Zentralverband report explained, because they
“ have departed from us since the last Congress.** It was made clear
that the National Socialists expected the cooperative societies to play
their part in the new Four-Year Plan, and the secretary of the
“ adjusted** Austrian associations declared that they would be in the
front line. The National Socialists established a new board to ex
amine each cooperative society individually and submit proposals for
fusion, separations, or possibly the liquidation of the movement.
On February 18, 1941, a German decree announced plans for the
liquidation of the Austrian (and German) consumers' cooperatives.
The Austrian affiliates of the Zentralverband and of GoC, with their
property and assets, were to be handed over to the Labor Front (later
absorbed by the German Labor Front) and managed or disposed of by
it. The wholesale was to become a subsidiary branch of the Public
Works Management. The transfer was to be administered by the
Bank of the Labor Front; an attempt to retain the cooperators* good
will was made by providing that the Labor Front must repay the
members* share capital and deposits. That this transfer eventually
involved disposal of cooperative assets to private business is indicated
by a statement in Fascism, January 1943, that the German order for
the “ handing over of consumers* cooperatives to private enterprise
* * * is now at hand.**1
1 Sou rces .—The report.on Austria is based upon data from the following publications: Statistisches Handbuch fur die Republik Osterreich, Bundesamt fur Statistik, Vienna, 1921, 1923,1924, 1926,1929, 1931, 1932,
1935,1936, and Statistisches Jahrbuch fur Osterreich (Vienna), 1938; International Cooperative Bulletin
(International Cooperation Alliance, London), issues of June, July, and October 1911, July and August
1912, August 1914, January, April, and December 1915, June 1916, January 1917, July and August 1918,
December 1919, January, February, and June 1920, January and March 1921, February and October 1922,
July and August 1923, January and May 1924, May, September, andNovember 1925, July and August 1926,
January, June, and July 1927; Review of International Cooperation (International Cooperative Alliance,
London), issues of May, June, and July 1929, April, May, June, July, and August 1930, January, April,
M ay, J u l y , September, November 1931, June and October 1932, April and June 1933, Mafrch, May, and
November 1934, January, February, April, and M ay 1935, October and November 1936, October and
December 1937, March. April, and August 1938, January 1939, and June 1941; International Directory of
Cooperative Organizations (International Labor Office) 1929, 1933,1936; Cooperative Information (Inter
national Labor Office) No. 7,1929, No. 6,1930; People’s Yearbook (English Cooperative Wholesale Society,
Manchester, England), 1925,1928,1929,1930, 1931, 1933, 1934, 1935, 1937, 1938; and Annals of Collective
Economy (Geneva), April-July 1927, January-June 1938.
Czechoslovakia
177
Cooperative Movement in Czechoslovakia
All forms of cooperation had been developed in the Republic of
Czechoslovakia, but when that State was evolved in 1919 from areas
previously under the rule of Austria, Hungary, Poland, and Russia
the patterns of cooperative development and federation had already
been formed along nationality and, to some extent, political lines.
Under the friendly encouragement of the new government the co
operative movement expanded and became unified to some degree.
Certain well-marked divisions persisted, however, in the continuance
o f Czech, German, Socialist, and even “ bourgeois” groups, though
friendly relations were maintained among them and the various
branches joined forces on many occasions, for the protection of the
cooperative movement or the inauguration of some new service.
By 1937, nearly 6 percent of the population were members of the
three main consumers’ cooperative federations. Counting their
families, and allowing for the membership of nonfederated associations,
the retail cooperatives must have been serving at least 30 percent of all
the people in Czechoslovakia. The membership of the entire coopera
tive movement included about 6,000,000 of the 15,000,000 population.
The cooperatives had recovered from the depression and a considerable
degree of progress had been made in the manufacture of commodities
by cooperators for their own use.
This progress was abruptly terminated by the Munich Agreement,
and the German branch of the cooperative movement was wiped out,
practically at one stroke. The Czechoslovak cooperators (like their
cooperative comrades in Belgium) saw their country overrun by the
Germans for the second time in a period of 25 years. That they have
bravely resisted and kept courage is indicated by reports of unrest and
rebellion that have leaked out of the country. However, a condition
of servitude and oppression is not a new thing to these people. As one
writer, himself a Czech, commented after the end of the first World
War: “ For a thousand years the Czechs have waged a grim struggle
with the Germans,” against suppression of political, religious, and
linguistic rights, and systematic attempts at Germanization and even
extermination.
T ypes o f Cooperatives
Practically all of the main types of cooperatives were found in
Czechoslovakia— consumers’ associations, workers’ productive and
labor associations, home-building cooperatives, credit associations,
and agricultural processing, marketing, and purchasing associations
of all kinds, as well as rural associations for the supply of electricity.
One type of local association not represented was the insurance asso
ciation; apparently there were no local associations of this type, al
though the Czech and German consumers’ cooperative movements
each had a general insurance association writing policies for fire, life,
accident, and casualty risks. Most of the various kinds of associations
had their own federations, but there was a good deal of overlapping,
as some of the agricultural and consumers’ cooperative federations
also admitted other types of associations, such as credit, workers’
productive, housing associations, etc.
178
Cooperatives in Individual Countries
The number of cooperatives of the different types in various years
is shown in table 56. As is evident, a very great development of all
kinds of associations took place in the early years of the Republic.
T able
Year
1920
1923.......
1927_____
1929.......
1932____
1934.......
1935.......
1936.......
56.— Num ber o f Cooperatives in Czechoslovakia, by T yp e9 1 9 2 0 -3 6
Work
Agricul
Credit
tural
ers’
Hous
All
pro
market
Con
ing
types sum
All
ing,
con ductive Elec
Other
Schulzetypes except ers’ struc and tricity supply,
Other*
Desmall
and
Total Raiff
credit
tion
eisen litzsch
art
produc
tion
isans
'll, 247
14,942
15, 576
15,973
17,232
17,021
16,832
16,744
5,997 1,639
9,090 <2,261
9,072 1,217
8,914 1,066
9,530 1,029
903
9,395
9,261
835
9,165
816
992
1,326
1,537
1,533
1,633
1,489
1,418
1,341
1,551
1,825
1,594
1,342
1,420
1,492
1,497
1,504
(2)
(2)
(2)
2,159
2,550
2,531
2,500
2,475
1,796
3,479
4,609
2,730
2,792
2,845
2,869
2,889
19 *5,250
199 5,852
115 6,504
84 7,059
106 7,702
135 7,626
142 7,571
140 7,579
53,872
4,385
4,807
4,190
4,384
4,390
4,376
4,374
s 1,378
1,467
1,697
1,800
2,065
2,016
1,988
2,005
(*)
(*)
1,060
1,253
1,220
1,207
• 1,200
* Associations in Slovakia and Russian Subcarpathia (Ruthenia).
* No data; probably included with agricultural.
* Data are for 1921.
* Includes workers’ productive.
* No data.
« Approximate.
HOUSING ASSOCIATIONS
Cooperative associations for the building of houses were among
the early forms of cooperation in Czechoslovakia, and even as early
as 1908 the Bohemian associations had formed their own federation.
After the formation of the Republic, the housing associations were
encouraged by State aid in the form of a direct subsidy and a guaranty
of mortgage indebtedness up to 90 percent. By 1920 there were 992
of these associations, of which over 200 were members of the Central
Union of Cooperative Housing Societies.
Data published by the Government, covering the year 1924, showed
that 787 reporting associations had constructed 11,926 buildings pro
viding accommodations for 91,236 persons in 24,365 dwellings; they
had also built 26 nonresidential buildings. The cost of construction
amounted to 1,624,363,000 koruny,3 of which 124,502,000 koruny
was advanced by the Government, and 1,159,024,000 koruny repre
sented mortgages guaranteed by it. Public employees constituted
44 percent of the membership, industrial and building-trades workers
nearly 24 percent, and artisans over 13 percent; farmers, miners,
agricultural laborers, and others made up the remainder.
Several of the consum ed cooperative federations also accepted
housing associations into membership. In 1937, of about 1,300 co
operative housing associations, 324 were members of the Central
Union of Housing Cooperatives, 155 were affiliated with the “ Unie”
(Socialist) federation, 138 with the Central Union of Czechoslovak
Cooperatives, and over 70 with the German Union— a total of 687
associations. The Commission of Inquiry on Cooperatives, sent to
Europe by President Roosevelt in 1937, reported that up to 1931 the
associations affiliated with the Czech Union had provided dwellings
for 10,787 families. It stated that their activities “ were not confined
to urban centers but also resulted in the establishment of several
new model communities.”
2For par values of currency, see Appendix table, p. 278.
179
Czechoslovakia
w o r k e r s ’ p r o d u c t iv e
a s so c ia t io n s
The number of productive associations of workers, craftsmen, and
small industries reached a peak of 1,825 in 1923. After that (through
1936) the number remained remarkably stable, ranging only between
1,342 (1929) and 1,594 (1927).
These associations had their own federation which, in 1937, had
254 member associations. There were also nearly 60 associations
affiliated to the “ Unie” federation, and 172 (with 25,685 members)
belonged to the Central Union of Czechoslovak Cooperatives. The
965 workers’ productive associations for which the Government
Statistical Office obtained data in 1930 had 104,043 members and did
a business that year amounting to 1,346,926,000 koruny.
The President’s Inquiry Commission found that few of these asso
ciations had attained “ marked success,” being hampered by the usual
problems of this type of cooperative—insufficient capital and difficulty
of marketing the product. The Commission reported that the asso
ciations affiliated with the Czech Union were in a more advantageous
position than most of the others, “ since at least part of their market
is provided for by consumers’ cooperatives from which in many
instances they receive financial support and management advice.”
In 1925 the 217 active associations in membership with the Czech
Union were engaged in the manufacture of foodstuffs (bakery prod
ucts, meat products, flour, etc.), clothing, footwear, stone and glass
products, toys, baskets, wooden articles, printing and paper, as well
as in the operation of transport facilities, theaters, movies, etc. The
operations of the member associations from 1911 to 1935 are shown in
table 57.
T
able
5 7 . — M em bership and Operations o f W orkers* Productive Associations Affiliated
to Central Union o f Czechoslovak Cooperatives, 1 91 1 -3 5
[For par values of currency, see Appendix table, p. 278]
Number of
associations
Year
1911.............................................................................................
1919.............................................................................................
1922.............................................................................................
1925........................................... ..................................................
1928.............................................................................................
1930.............................................................................................
1935.............................................................................................
Members
Amount Oi
business
K ro n er
33
85
253
245
202
190
172
,% 184
3,903
13,082
11, 642
15,307
19,462
25,685
5,500,000
K o ru n y
30,685,301
173,562, 729
223,382,352
307,086,594
(9
*235,843,488
* No data.
* Data are for 1936.
CREDIT ASSOCIATIONS
The credit associations formed an important part of the cooperative
movement in Czechoslovakia. In 1936, of 16,744 associations of all
types, 7,579 were credit cooperatives. Over half of these (4,374)
were rural associations of the Raiffeisen type, which purchased sup
plies as well as made loans,4 and 2,005 were associations of the
Schulze-Delitzsch type, furnishing credit to artisans and industrial
enterprises; there were also about 1,200 associations in Slovakia and
Russian Subcarpathia (Ruthenia) whose type was not reported.
4 In Czechoslovakia these associations were called “ Kampelikies,” after F. C. Kampelik, through whose
initiative the associations were introduced into the country.
180
Cooperatives in Individual Countries
The credit associations were federated into several central organi
zations. Thus the Schulze-Delitzsch associations had their own
national federation, as did also the Raiffeisen associations. In addi
tion there were in Slovakia a federation of rural credit associations and
one of the urban associations.
Each of the consumers’ cooperative federations also had a few credit
cooperatives in affiliation, and the consumers’ associations themselves
accepted savings deposits.
The membership of the 7,579 cooperative credit associations in
existence at the end of 1936 was not reported, but the 4,988 associa
tions affiliated to the various federations had a total of 1,643,919
members or 11 percent of the total population.
AGRICULTURAL COOPERATIVES
The agricultural cooperatives included the usual purchase and sales
associations as well as dairies, alcohol distilleries, flour mills, bakeries,
fruit and vegetable canneries, chicory works, starch works, land cul
tivation and leasing associations, electricity associations, and associa
tions for joint use of machinery.
Their number increased continuously after 1920, the first year for
which data are available, though the membership and sales showed
some fluctuation. In 1936 there were 5,364 agricultural cooperatives
other than credit. Of these, 2,475 were electricity associations, over
700 were consumers’ cooperatives purchasing farm and household
supplies for their members, and the rest were productive, processing,
and marketing organizations. The Czechoslovak Office of Statistics
reported that in 1930 the business of the agricultural consumers’
cooperatives amounted to 174,838,000 koruny and that that of the proc
essing and marketing associations aggregated 2,147,436,000 koruny;
no data were given for the electricity associations.
The agricultural cooperatives were federated into a number of
Provincial and National bodies. Among the latter were organizations
for the cooperative purchasing of supplies, for the marketing of dairy
products, seeds, sugar beets, and livestock, respectively, and for the
purchase of electrical equipment and of plumbing materials. Most
of the federations also carried on banking operations. Many of these
federations accepted all types of associations into membership and
most of them were in turn federated into a national organization,
Centro-Kooperativ. This body was formed in 1921 and its duties
included the auditing of the accounts of the federations and wholesale
associations, arbitration of differences among them, giving legal
advice, and representing the agricultural cooperative movement before
the Government and the public. It also took an active part in the
import and export of agricultural commodities.
Electricity associations.— The first electricity cooperative was started
in 1911. The development of these associations was hastened by the
passage of an act granting financial assistance to organizations for
the electrification of rural areas. By 1926 there were 736 of them,
having a total of 6,300 kilometers of line and serving 1,720 village
areas. These associations took two forms, one type of cooperative
acting merely as distributors of electric current, the other generating
current as well as distributing it. The tendency has been toward
concentration in the former field, as generation and high-tension
Czechoslovakia
181
distribution were taken over very largely by 24 public-utility districts
covering the whole country. Of nearly 2,500 associations in 1936,
only 30 were generating their own current (one of these distributed
power to 224 communes and was among the largest in Central Europe),
500 had distributive installations only, and the rest were associations
formed to finance extension of lines and residential installations to
receive power from the utility district. The electricity associations
generally also supplied their members with electrical appliances as
well, buying through “ Ves,” the national cooperative purchasing
association in the electrical field.
The electricity cooperatives in operation at the end of 1925 had
59,146 members, of whom about 60 percent were farmers. In 1937
there were 2,122 of these associations; 1,512 reporting cooperatives
had a combined membership of 91,561.
con su m ers’
c o o p e r a t iv e s
The data available do not indicate the various forms taken by the
consumers’ cooperatives. It is believed that they were mainly of the
store type, handling groceries and household and family supplies. Some
of them also carried on welfare activities. One large association with
59.000 members operated a home where invalid children received
care, free, for from 2 to 3 months.
There were also numerous “ people’s houses.” In 1935 there were
148 such associations (with 14,671 members) in affiliation with the
Czech union; no details are available regarding their activities.
One important cooperative was “ Cooperative Work,” an associa
tion founded in 1922 for the printing of books at as near cost as pos
sible. By 1928 it had 5,200 members, each of whom purchased at least
4 books a year. It then employed 20 workers and had published 80
books.
CENTRAL COOPERATIVE ORGANIZATIONS
Up to the time Czechoslovakia was invaded, in 1938, there were at
least three central federations in the consumers’ cooperative movement,
separated by nationality and political differences.
(1) The Czech associations had their Central Union of Czechoslovak
Cooperative Associations, formed in 1908. Its member associations
consisted mainly of local consumers’ cooperatives formed among the
industrial workers, but it also admitted workers’ productive associa
tions, housing cooperatives, credit associations, and even some
agricultural supply associations. In 1937 (the latest year for which
figures are available) the union had 743 affiliated associations with
nearly half a million members. About 200 of these organizations, with
385.000 members, were consumers’ cooperatives.
Affiliates of the Czech union were required to confine their dealings
to members only, do business on a strictly cash basis, distribute their
earnings on the basis of patronage, and put at least 10 percent of
earnings into the reserves. The trading area of a local association
was limited to a single locality and could not be extended without the*
consent of the association in the locality to which extension was pro>osed. Only one association was admitted from any locality, regardess of the size of the area covered.
;
182
Cooperatives in Individual Countries
Connected with this union, but incorporated separately, were the
Cooperative Wholesale Society (known, by the initials of its name, as
“ V . D. P.” ) formed in 1909 and serving about 300 associations, and
the General Cooperative Bank formed in 1921 by the union and whole
sale.5 There was also a central insurance association, “ Czechoslavia,”
started in 1919, which wrote fire, life, accident, and other insurance for
the members of cooperatives,
(2) The German section of the movement had its G. E. C. Union of
German Distributive Societies with about 140 associations. The
original union (Union of German Provident Associations) was formed
in 1919, but took the above name in 1924 when the German wholesale
“ G. E. C.,” formed in 1905, became a department of the union. This
organization also had in affiliation the Union of Polish Distributive
Societies in East Silesia— a small organization with 8 member
associations.
(3) There was also a Socialist group with a series of central coop
erative organizations. These consisted of the Union of Czechoslovak
Cooperative Societies (popularly called “ Unie” ), formed in 1923; sub
ordinate unions of the workers' productive and housing associations
that were affiliated to Unie; and a wholesale called “ Union.” The
Unie group consisted of about 130 associations.
All of the above organizations were classified in the Czechoslovak
official statistics as of the “ worker group.” The “ bourgeois group”
included, in addition to several auditing unions, the following: (a)
Central Union of Cooperative Housing Associations, formed in 1908
and having 324 member associations in 1937; and (6) Union of Coop
erative Credit Associations, formed in 1884. The latter was the
central union of the Schulze-Delitzsch associations providing credit for
businessmen and small traders. It had its own central bank. In the
group classified as “little industries” was the Union of Craftsmens'
Cooperatives, formed in 1910 and having 254 affiliated associations
in 1937.
There was also an informal committee, the Working Alliance of the
Cooperative Agricultural and Distributive Societies of the Czecho
slovak Republic, formed in 1928, to which all branches of the coop
erative movement in Czechoslovakia belonged. Its duties were to
consider changes in the laws, and to protect the movement on ques
tions of taxation, tariff, and other matters.
Development o f Consumers’ Cooperatives
Under Austrian Rule
The consumers' cooperative movement in Czechoslovakia dates
from about 1869, when a beginning was made that grew rapidly for a
few years and then died out as a result of unfavorable laws and lack of
practicality in the cooperative leaders. About 1890 a second start
was made, largely trade-union in origin and closely connected with
Marxian Socialism; it never attained much success. The first asso
ciation on the Rochdale basis was a retail association formed in
Prague in 1905. ^
During all this time the local associations had been part of the
Austrian cooperative movement and members of the Austrian Coop
erative Union at Vienna. In 1907, however, the Bohemian coopera-*
*In
1925
the German union also acquired part of the bank’s share capital and became a member of it.
Czechoslovakia
183
tive associations decided to form their own educational federation and
in 1908 established the Central Union of Czechoslovak Cooperatives,
with headquarters at Prague. In the following year the V. D. P.
cooperative wholesale was started; in that year, also, the Czech union
became a member of the International Cooperative Alliance. All this
gave new impetus to the movement and by 1912 the union had 265
member associations.
The Balkan Wars retarded the development of cooperative activity
but it had begun to expand again when the first World War broke out.
Operations became extremely difficult, especially in view of the peri
odic suspensions of transportation of civilian goods. However, the
wholesale was able to hold its prices below the general level and was
thus of real advantage to the workers, who were the largest group of
cooperative members. It paid its mobilized employees two-thirds of
their wages all during their war service and took out insurance for
them against death in action.
From the very beginning of the Rochdale cooperative movement in
Czechoslovakia, emphasis had been laid on financial stability. One of
the first duties undertaken by the Central Union was that of auditing
the books of its member associations and installing a uniform system
of bookkeeping among them. Instead of paying high rates of patron
age refund, the associations held the rate to 3 percent and put the rest
into reserves and welfare funds (for funeral benefits, etc.). Even the
patronage refunds that were declared were not paid in cash but were
credited to the members, savings accounts with the association.
Nonmembers received refunds at half the members’ rate. So strongly
organized were the associations that, although during the war period
1914-18 a special fund was created for assistmg local associations, the
money never had to be touched.
Consumers’ Cooperation Under the Republic
The Republic of Czechoslovakia was established by revolution of the
people against the Austro-Hungarian Empire in October 1918, and
later received confirmation by the peace treaty after the end of the
war. The new Republic consisted of the former Austrian Provinces
of Bohemia, Moravia, and Silesia, Russian Subcarpathia (Ruthenia),
and the former Hungarian Province of Slovakia, the people of which
voted to be included.
The new Government faced an enormous task. The former
Austrian territories contained the richest natural resources in all
Central Europe; Bohemia and Moravia were also highly industrialized
even at that time and had produced about 80 percent of the entire
industrial output of the former Austro-Hungarian Empire. Slovakia
was largely agricultural. During the war, however, the machinery
had been worn out or requisitioned for German factories, the cattle
had been carried off or slaughtered, and even the railroad rolling
stock had been expropriated.
The country had been so stripped, in fact, that even the provision
of food sufficient for the bare subsistence of the populace was difficult.
The president of the Central Union of Czechoslovak Cooperatives
reported to the Inter-Allied Cooperative Conference in Paris in Febru
ary 1919 that the entire food supplies of the country would be exhausted
within 4 weeks and the people would be dependent on what could be
184
Cooperatives in Individual Countries
imported on credit from abroad. The workers’ efficiency was low
because of the long period of undernourishment that they had endured.
The currency was badly inflated also, and in addition, the Republic
had assumed the old internal debt of the former Empire for the terri
tory of Czechoslovakia.
However, difficult as conditions were, it was pointed out that Czecho
slovakia was the only State in either Central or Eastern Europe in
which there was “ absolute social peace and order.” During this period
(known as the “ hunger crisis” ) the Government used the services of the
Czech cooperative wholesale to supply food to about 1,200,000 indus
trial workers not members of cooperatives.
The Republic entered upon its existence with very enlightened
policies and democratic practices. With universal suffrage and an
announced policy of “ social reforms without bloodshed,” it was far in
advance of most of the other countries of Europe. President Masaryk
pledged that “ our national policy will loyally recognize the national
and linguistic rights of the racial minorities [Germans, Magyars, and
Ruthenians] of our Republic.”
PERIOD OF COOPERATIVE EXPANSION
One of the early legislative acts of the Republic was the passage of
the agrarian law of April 16, 1919, which authorized the acquisition
and breaking up of the great estates (almost one-third of the land of
Czechoslovakia was in the hands of German proprietors) for distri
bution to the people. Under this law the Government acquired an
area totaling some 17,000 square miles, for which compensation was
paid to the owners, except in case of those who had been “ guilty of
offenses against the Czechoslavak Nation.” Thousands of peasant
holdings were thus created, the farmers buying them from the Govern
ment on a long-term basis. The law gave tremendous impetus to all
kinds of agricultural cooperatives among these new landholders, and
between 1920 and 1923 the number of agricultural associations rose
from 1,796 to 3,479.
When the Republic was formed there were already, in Czechoslovak
territory, a number of separate cooperative movements each federated
not only territorially but by language as well. Thus the Czechs,
Slovaks, Germans, Ruthenians, and Poles each had one or more
federations, and for the most part these continued on the former basis.
All during the war, the Czech union at Prague and the Austrian
union at Vienna had collaborated to meet the problems of the coopera
tive movement. After the fall of the Empire, however, by mutual
agreement between the two unions, the Czech cooperative associations
that had continued in affiliation with the Austrian Cooperative Union
(84 in number) withdrew from it and joined the Central Union of
Czechoslovak Cooperative Associations, bringing the total member
ship of the latter to 440 associations.
In 1919 the V. D. P. wholesale decided to cease the payment of
patronage refunds to member associations and, instead, to lower its
prices. In the same year the Czech consumers’ cooperatives, the tradeunions, the Social-Democratic Party, and the health-insurance funds
joined in the formation of “ Czechoslavia,” a cooperative insurance
association.
In that year, also, some 55 German cooperative associations formed
the Union of German Provident Associations in Czechoslovakia.
Czechoslovakia
185
Representatives of the Czech union were present and expressed their
good will, as did also representatives of the Austrian union to which
the German cooperatives had formerly belonged. These original
friendly relations continued throughout the next 20 years and on
many occasions the two unions and wholesales joined forces.
In 1919 the Prague branch of the Austrian cooperative wholesale
became an independent organization, known by the initials of its
name as the G. E. C. wholesale. As early as 1920 it was reported that
G. E. C. was supplying one-third of the 3,500,000 Germans living in
Czechoslovakia.
P O S T -W A R D EPR ESSIO N A N D R E C O V E R Y
Under the encouragement of the Government, cooperatives of all
types expanded rapidly— so rapidly, in fact, that they suffered from
diffusion of energies among too many activities. However, they were
so soundly organized that at least the consumers7cooperatives were able
successfully to resist for some years the post-war depression, with its
unstable currency, fluctuating prices, and unemployment. Through
out 1921 their business continued to increase.
The consumers7 cooperative unions had already begun to urge the
consolidation of the resources of the movement through the merger
of small associations. The announced aim of the Czech movement
was eventually to have not more than 3 associations in the whole of
Moravia, 7 in Bohemia, and 4 or 5 in Slovakia. In the German move
ment also the merger idea received impetus through the merger, in 1924,
o f the German union and wholesale into a single organization, the
G. E. C. Union. In 1925 the German and Czech wholesales agreed
upon a plan whereby neither would enter into production of goods
already manufactured by the other but would obtain its supplies of the
commodity in question from the other wholesale. No new fields of
production would be entered except by mutual consent. Further,
It was agreed that in the interests of efficiency, local associations
situated nearer to the other wholesale than to their own would obtain
their supplies from the former.
In 1928 a further joint step was taken by the Czech and German
unions in their decision to participate in the International Cooperative
Congress as one body (both were members). They also formed a
joint committee which was given authority to decide all questions of
principle, propaganda, legislation, business matters, etc., arising in the
consumers7 cooperative movement.
After the cooperative congress of 1928, V. D. P. and Kooperativa
(the joint purchasing agency for the agricultural cooperatives) created
a committee to facilitate collaboration between the two bodies. Each
agreed to obtain from the other the commodities handled by it and to
•exchange information on costs of production. Each association
became p member of the other.
With the general stabilization of the economic life of the country,
during 1928, nearly every branch of industry benefited, unemploy
ment went down to unusually low levels, and purchasing power
increased. This in turn was reflected in both the German and Czech
branches of the consumers7cooperative movement, where sales reached
a 10-year peak.
688544°— 44------13
186
Cooperatives in Individual Countries
However, even then the secretary of the German union warned that
the building industry was slackening, there were signs that business
generally was falling off, and “ world economic conditions also give
cause for anxiety." This statement was amply justified by the events
of the next few years, when business was practically at a standstill.
COOPER ATIVES IN
T H E T H IR T IE S
The worst of the depression in Czechoslovakia occurred in 1930,
but even as late as the end of 1933 the situation was still extremely
bad, especially in the Sudeten areas where the German consumers'
cooperatives were most developed. The German union reported that
in some of these localities 10 percent of the population were out of
work and were on relief or “ literally face to face with destitution."
During the early thirties the devaluation of the currency resulted in
some improvement in foreign trade, but it was reported that the
resulting decrease in unemployment was “ offset by lower wages and
more short-time work."
Cooperative sales decreased each year through 1935, but the decrease
was not proportionately so great as the decline in prices and in
purchasing power, and the membership continued to rise steadily.
In 1935 the G. E. C. union reported that its associations returned some
14,000,000 koruny in patronage refunds on the year's business.
In that same year the union, in collaboration with the German tradeunions, formed its own insurance association, “ Vorsorge." This
organization started business, writing fire and life insurance, on
April 1, 1936.
It was pointed out at that time that most of the troubles of Czecho
slovakia came not from within, but from the general international
situation and political troubles in the surrounding countries. The
trend toward the corporative state and dictatorship in Austria,
Bulgaria, and Italy, and the rise of the Nazis in Germany did, how
ever, have one favorable result in Czechoslovakia: it brought the
German and Czech branches of the cooperative movement closer
together than they had ever been before. Together they undertook
a campaign of publicity which brought in many new members.
The situation during the early thirties had been complicated for the
cooperatives by what were characterized as “ guerrilla attacks of the
mixed forces of capitalist commerce and political extremists." How
ever, these attacks, with the attendant publicity, really benefited the
movement by attracting new members and strengthening the loyalty
of the others. The Czech Union reported an influx of some 2,000
artisans and over 5,000 farmers into the store associations during
1934. Altogether the store associations in the Czech group were, it
was estimated, serving about 1,500,000 persons. The occupational
make-up of the store associations' membership was reported as follows:
Wage earners in industry, 233,533; clerical workers, 64,725; artisans
(independent workers in trades), 23,202; farmers, 29,703; and others,
33,857.
In 1936 the Czech cooperative movement adopted a 10-year plan of
expansion, setting definite quotas to be reached as regards number of
associations, membership, business, capital, production, etc. The
German branch followed suit shortly thereafter with a 3-year plan,
and reported in the very next year (1937) that some of the 3-year
goals had already been reached.
187
Czechoslovakia
T a b l e 58.— Operations o f M em bers o f Czechoslovak Cooperative Union and o f Cooperative Wholesale, V . D . P ., 1 9 0 8 -4 0
[For par values of currency, see Appendix table, p. 278]
Czechoslovak Cooperative Wholesale,
V. D . P.
Central Union of Czechoslovak
Cooperatives
Num
ber of
mem
ber
asso
cia
tions
Year
Their
mem
bers
Amount of
business
Net
earnings
A u stria n
kronen
A u strian
kronen
7,180,309
12,459,972
26,664,770
Num
ber of
mem
ber
asso
cia
tions
172,568
516,218
614,195
Amount of
business
Net
earnings
Value of
own pro
duction
A u stria n
kronen
A u stria n
kronen
A u strian
kronen
1908...................
1910...................
1914...................
86
198
285
14,267
37,202
71,504
1919...................
1920...................
1922...................
1925...................
1929...................
1930...................
1931...................
698
1,117
1,373
1,238
1,043
1,035
939
291,309
574,020
556,749
470,660
443,242
461,541
488,275
307,397,747 5,340,316
984,570,005 13,510,581
1,326,315,043 5,051,692
1,180,153,725 4,876,511
1,342,849,828 9,016,223
1,319,076,103 8,032,845
1,281,156,158 6,892,030
431
533
518
367
347
344
340
294,423,210 2,145,333
875,186,632 2,385,620
588,685,870 2,590,065
544,852,947
140,682
604,723,506
363,107
490,196,739
271,105
477,945,815
318,114
<0
(0
47,539,213
90,142,650
174,009,431
112,674,140
118,114,394
868
459,733
0)
472,538
469,320
0)
490,909
1,111,022,610
(0
1,029,770,385
(0
(0
1,314,319,000
341
331
322
316
304
301
0)
0)
494,054,326
758,163
460,227,275
0)
455,458,000
0)
471,299,553
(0
528,682,913 4,621,227
550,566,000
0)
638,500.000
0)
123,678,681
136,974,659
138,815,898
154,663,190
198,723,550
172,421,000
0)
K o ru n y
1932...................
1933...................
1934...................
1935...................
1936...............
1937...................
1940...................
0)
775
0)
0)
743
0)
0)
1,024,296
3,238,427
0)
58
262
K o ru n y
K o ru n y
0)
0)
0)
0)
(0
0)
0)
0)
(0
11,120
45,539
K o ru n y
0)
0)
0)
K o ru n y
* No data.
T a b l e 59.— Operations o f German Cooperative Wholesale and o f M em bers o f Union of
German Cooperatives in Czechoslovakia, 1 91 8 -3 6
[For par values of currency, see Appendix table, p. 278]
Members of German union
Year
Asso
Their
ciations members
Amount of
business
German cooperative wholesale, G. E. C.
Num
ber of
mem
ber
associa
tions
K o ru n y
Wholesale’s operations
Amount of
business
K o ru n y
Value of own
production
K o ru n y
1918-19......................................
1919-20......................................
1920-21......................................
1921-22......................................
1922-23...................................
1924-25......................................
285
288
285
271
239
206
182.236
264.386
303,054
301,253
286,004
269,591
166,341,829
366,394,081
712,625,447
749,788,001
490,027,409
461,690,395
1925-26......................................
1926-27......................................
1927-28......................................
1928-29......................................
1929-30.....................................
1930-31.................. ..................
181
173
168
168
159
153
248,640
238,058
233,722
231,875
236,568
243,781
495,536,917
529,409,902
558,655,329
587,170,299
590,753,950
578,061,696
0)
0)
0)
0)
255,864,949
278,302,142
288,681,734
302,092,627
323,698,873
318,416,856
22,911,000
30,729,506
46,211,000
51,156,219
56,052,453
56,255,428
1931-32......................................
1932-33......................................
1933-34...................... : ............
1934-35.....................................
1935-36.....................................
148
146
0)
140
0)
256,482
262,300
0)
247, 474
238,525
573,812,433
532,564,261
459,982,263
447,531,509
465,944,542
158
166
0)
160
0)
310,525,092
292,165,370
281.426,481
273,728,000
295,938,000
57,494,722
53,005,470
54,216,168
52,700,000
57,268,000
1No data.
2 18 months, ending June 30.
300
0)
<0
(i)
v)
0)
183
133,122,175
403,453,635
459,422,672
301,739,340
282,231,527
2 382,999,702
5,687,000
7,573,000
8,775,000
10,480,000
12,395,000
21,090,000
188
Cooperatives in Individual Countries
The decreases in membership during the period 1922-28, shown in
tables 58 and 59, were caused almost entirely by the dropping of
nonpurchasing members from the rolls.
Legal Status and Relations W ith the Government
The first law under which cooperative associations could be formed
in Bohemia was an Austrian “ patent” law of July 1840. This was
superseded by a patent law of November 1852. In 1873 a law relating
to “ cooperative and economic societies” was passed, in the belief that
by giving workers the opportunity to form their own enterprises and
improve their economic position—
All danger of communism will be avoided, as its false doctrine, which flatters
the worker, will not find suitable soil, for the introduction of the principle of
self-help into real life, protected and carefully safeguarded by legislation and the
Government, will morally raise and strengthen the worker. Further, experience
has taught that thereby the best opportunity is given to the worker to improve
his material position and to help him to be independent without injuring other
tradespeople or endangering the possessions of the well-to-do classes.
This law was carried over into the Republic and was still in force at
the time of partition of Czechoslovakia in 1938. It provided for four
types of associations: Consumers' retail and wholesale cooperatives,
industrial associations of independent artisans and farmers, building
and housing associations providing houses for purchase or lease, and
credit associations of the Raiffeisen and Schulze-Delitszch types.
Later amendments made compulsory an independent audit of the
books of cooperative associations every 2 years, exempted dealings of
cooperatives with their members from the stamp tax, provided for
payment of taxes on share capital, and imposed special trade taxes.
This last tax measure divided cooperatives into two classes— those
dealing only with members and those serving nonmembers also; a
higher rate of taxation was provided for the second class and an addi
tional profits tax, ranging from 2 to 4 percent according to the rate
of earnings of the association.
The new Government, in its first decade, passed several measures to
aid cooperatives. Thus, in January 1922, three branches of the co
operative movement— the agricultural, artisan, and labor coopera
tives—were each given outright grants of 50 million koruny to assist
their development; the consumers' cooperatives did not share in this
largesse. However, cooperatives of all types shared with private
businesses the benefits of a law of October 9, 1924, that provided com
pensation for property destroyed during the war of 1914-18.
In 1922 a Department of Cooperation was established in the Min
istry of Social Welfare and in 1934 an advisory board composed of
representatives of all the consumers' cooperative federations was
created in the same Ministry, by decision of the Government Council
of Ministers.
Like all representative Governments, that of Czechoslovakia was
subject to and sometimes responsive to pressure from special groups.
For many years the private merchants had been agitating against the
competition of the cooperatives. Part of their displeasure may have
stemmed from the fact that most of the consumers' cooperative
Czechoslovakia
189
associations of industrial workers, which formed the larger part of the
membership of the Czech and German unions, did not follow the
Rochdale method of sale at current prices (which avoids the appearance
of price cutting) but sold their goods as cheaply as possible consistent
with safety. This practice, of course, gave immediate emphasis to
the savings possible through membership in the cooperative, as com
pared with those in private stores. A study made by the Government
Office of Statistics in 1933, revealed that the prices in the large urban
associations were as much as 9.6 percent below those in the private
stores and for the whole country about 5.1 percent lower.
As already noted, the opposition of the merchants was intensified
during the depression of the early thirties. As the distributive
machinery in Czechoslovakia was very much overdeveloped (in 1930
it was found that there was 1 retail store for every 58 inhabitants)
thousands of small businesses failed when the purchasing power of the
people fell off sharply. In 1928, the merchants had been successful
in obtaining passage of a law to regulate “ unfair competition.” This
law contained (among other things) heavy penalties for cooperative
associations having bylaws providing for dealings with members only,
which made sales to nonmembers; their charters could even be revoked.
The cooperatives charged that, in order to harass the associations,
agents provocateurs were used by the merchants to make purchases
from new clerks not acquainted with the members.
The merchants also attempted to obtain legislative measures to
prevent the expansion of cooperative associations, to require them to
join chambers of commerce, to have associations of mixed types de
clared illegal, and to subject cooperatives to special legislation.
Thanks to assistance by the various liberal political parties, all of
these measures were defeated.
During the economic crisis extraordinary powers were delegated by
Parliament to the Executive branch of the Government, to issue orders
which, if signed by the President, had the force of law. A decree of
May 18, 1935, issued under this authority, relaxed the provisions of
the 1928 law, in order that the Government might utilize the coopera
tive machinery for the improvement of conditions. This order
authorized cooperative associations to undertake, in addition to the
regular business for which they were chartered, social, educational,
and health (but not curative) activities for nonmembers as well as
members, provided these activities had no political object. The order
gave specific authorization to mixed types of associations (such as a
consumers' association carrying on a productive department) and
relaxed the nonmember-trading ban as regards such subsidiary activi
ties. It declared that sales to nonmembers were not in contravention
of the fair-trade-practice law and that thereafter they could be pun
ished only by fine. Nonmember sales were specifically permitted (1)
in order to help local authorities, (2) to prevent spoilage of goods,
and (3) when the sale was made inadvertently.
A Government decree of July 16, 1935, providing for temporary
restrictions on new enterprises in certain lines of business, specifically
recognized the special status of cooperative associations and required
merely that opening of new shops must have the formal permission of
the Central Union.
Another decree, prohibiting the making of gifts in connection with
the sale of goods or services, was supported by the private merchants
190
Cooperatives in Individual Countries
in the belief that this would abolish the patronage refund, which is the
distinguishing feature of consum ed cooperatives. As a result of
representations by the cooperatives, a provision was written into the
decree specifically recognizing and exempting refunds bearing a fixed
proportion to purchases.
Status o f Cooperatives Just P rior to M unich Agreem ent
By 1937 the cooperative movement had, as noted, attained a posi
tion of some importance in Czechoslovakia, with a considerable de
velopment in practically all branches of cooperation.
The movement had reached its greatest development in the “ his
toric” Provinces of Bohemia, Moravia, and Silesia, where (according
to official figures for 1936) over 80 percent of cooperatives of all types
were found. Nearly half of all associations were credit cooperatives.
In Slovakia nearly 83 percent of the associations were either agricul
tural or credit associations. The geographical distribution of co
operatives in Czechoslovakia in that year is shown in table 60.
T a b le 60.— Geographical Distribution o f Cooperatives in Czechoslovakia in 1936 , b y T yp e
All
types
Type of association
Entire country___________ ___ _____
"Rnhpmift
M n r e v ift a n d S ilesia
„T
Workers'
producCon Housing
Electri Agri tlves and
Credit
cultural associa
sumers'
cooper associ associ city asso associ tions of Other
atives ations ations ciations ations artisans
and small
tradesmen
16,744
}l3 ,670 /
....
1
Slovakia_______ ____________________
/
}
Russian Subcarpathia (Ruthenia)___ 3,074 {
816
398
821
78
19
1,341
2,475
2,889
1,504
140
895
f 2,121
274 } 6,379 \ 319
158 } 1,200 f
33
14
l
2
809
744
1,165
171
882
411
158
53
90
27
20
3
7,579
Figures published by the Statistical Office of the Government indi
cate that the 9,165 cooperatives other than credit were distributed,
as to language, as follows:
N u m b er o f
associations
Czech____________________________ _______________ 6, 825
German__________________________ _______________ 1, 695
Ruthenian_____________________________________
135
Polish___________________________________________
32
Other and mixed nationalities_____________________
478
No complete data as to the business done are available later than
1930. The Government figures for that year indicated a total coopera
tive business (not including, however, the loans granted by the credit
cooperatives) of almost 6 billion koruny.
The agricultural cooperatives were extensively federated, with over
50 central organizations giving various kinds of service, such as
auditing, banking, technical advisory service, and purchasing of
supplies, besides large national associations specializing in a given line.
The marketing cooperatives handled 87 percent of all the cereals in the
country. The local agricultural cooperatives (not including the
electricity associations) had an aggregate membership of nearly 500,000 in associations doing processing, marketing, and buying farm and
household supplies.
Czechoslovakia
191
An even larger number— about 800,000—were members of con
su m ed cooperatives of various types. The housing associations had a
membership of over 100,000, but many of these were also members of
the store associations. The retail associations accounted for about
3.8 percent of the total retail trade of the country; the percentage
would have been much higher if the comparison were made on food
stuffs alone.
The greater part of the consumers’ cooperatives were federated into
the Czech union, the German union, and the “ Unie” federation. In
1930 of the total of 861 consumers’ cooperatives, 62 percent were affiliated
to these three federations. That these were the larger associations is
indicated by the fact that their combined membership constituted 93
percent of all the consumers’ cooperative membership in the country
and their business 91 percent of the total.
Both the German and Czech branches of the movement had by 1936
overcome the effects of the depression and were well on the upgrade.
This was true of the wholesales as well as of the local associations.
The former had made especial progress in their productive depart
ments. Proceeding on the principle that the greater the cooperative
production the greater the degree of cooperative self-sufficiency, both
wholesales early in their existence had begun to make some of the
goods they handled. Even through the depression the output of their
productive departments increased from year to year, almost without
a break. (For list of goods, see table 8, p. 28.)
As early as 1920 the Czech V. D. P. wholesale had become one of the
most important producers of flour in Czechoslovakia and by 1937 it
had become the largest flour-mill operator in that country. By 1936
its factories were producing about 130 articles; it also operated a
laundry. In that year it produced nearly 38 percent (in value) of the
goods it sold to member associations.
The productive activities of the German wholesale began while it
was still only a branch of the Austrian wholesale, with the opening of a
factory for canning fruit in 1918. Four years later it was operating
a chicory and spice plant, a coffee-roasting department, and a chemical
laboratory for analyzing food. It also manufactured elastic goods of
various kinds, underwear and other articles of clothing, shoe polish,
and flour. This association consistently emphasized the importance
of manufacture of its own products and nearly every year increased
the scope of its manufactures. By 1935 its productive enterprises
were producing many other commodities. Its own manufactures
accounted for about 20 percent of the goods it sold to its member
associations in 1935-36.
Cooperative M ovem ent and the N azis
During the year 1936 the German cooperative associations (that
were situated mainly in the Sudeten regions) were beginning to feel
the effects of the campaign by the Nazi sympathizers in the SudetenGerman (or Henlein) Party that had been formed in 1935. The
avowed intention of that party was to unite all the Germans in
Czechoslovakia under the Nazi banner. On the other hand, the
cooperators, though German, had through their associations taken the
stand of uncompromising defense of free, democratic action and were
collaborating with their Czech comrades to that end. They, there
192
Cooperatives in Individual Countries
fore, became objects of attack by the Nazi sympathizers, as “ traitors”
to the Pan-German philosophy.
Under the pressure of the intimidation, ridicule, and social boycott
resorted to by the Henlein followers, some of the middle-class members
began to leave the cooperatives.
The attacks were only sporadic at first, but had become continuous
by 1937. The German invasion of Austria in March 1938 led to a
new campaign against the cooperators, culminating in threats against
the jobs of members if they failed to withdraw, and even in physical
violence. Only the most hardy and independent members remained;
these were mainly of the wage-earner group.
The attacks reached a climax in September in assaults upon coop
erative members, individually and in their meetings. Cooperative
premises were looted and wrecked in many cases. So great was the
terrorism that many officers and leaders of cooperatives were forced
to flee for their lives. All this, commented one of them (later a
refugee to England) occurred “ at a time when Sudeten territories
still formed part of the Republic of Czechoslovakia. The damage
amounted to millions of Czech crowns.”
In an attempt to cope with the disorders deliberately provoked by
the Henlein Party, the Czechoslovak Government issued a general
mobilization order. However, English Prime Minister Chamberlain
had made the historic trip to Munich and shortly after the mobilisa
tion order was issued, the Czechoslovak Government representatives
were forced to sign the Munich Agreement. That agreement handed
over to Germany the entire Sudeten region, constituting about a
fourth of the land area and containing a Fourth of the population.
Early in November the Teschen district in eastern Silesia was ceded
to Poland and parts of Slovakia and Ruthenia to Hungary. In the
same month the Government of Czechoslovakia was changed by the
Parliament from a unitary to a Federal State and autonomy was
granted to Bohemia-Moravia, to Slovakia, and to Ruthenia. Almost
immediately an authoritarian regime was inaugurated in Slovakia,
and in March 1939 the independence of that State was proclaimed.
Within a few days the Germans invaded Bohemia, and on March 16
Bohemia and Moravia were proclaimed a protectorate belonging to
the territory of the Greater Reich, the Germans there being made
nationals of Germany and the others becoming “ subjects of the
protectorate.” By this move, Germany obtained possession of a
region that was the richest—both industrially and in natural re
sources— in all Czechoslovakia. Meanwhile Hungary had seized the
rest of Ruthenia and additional Slovak territory, and had denation
alized both the Ruthenians and the Slovaks there.
When the terms of the Munich Agreement were announced, the
German cooperators in Sudetenland and their leaders became marked
men. Many were seized and sent to concentration camps or were
killed. Others were fortunate enough to escape from the country.
The cession of Sudetenland practically wiped out the German
cooperative movement, which, according to data published by the
International Cooperative Alliance, had assets of 259,000,000 koruny,
and was operating about 1,550 stores. The goods therein were sold
to private traders at prices far below their value.
The Czech branch of the movement was relatively untouched, at
that time, as most of the associations were within the boundaries of
Czechoslovakia
193
the new Czechoslovakia. However, in the areas taken by Germany
and Poland it lost associations with nearly 500 stores and assets of
over 70 million koruny. Later estimates indicated that altogether
there were some 415,000 members in these German and Czech asso
ciations. No data were available regarding the losses involved in
the territorial seizures by Hungary.
The G. E. C. wholesale (with headquarters at Prague) had had its
entire business wiped out at one stroke, with the loss of the Sudetenland. After the Germans invaded Bohemia and Moravia, one of
their first acts was to take control of this German wholesale. A
long-time enemy of cooperation was appointed as commissar and he in
turn appointed other Nazis to take inventory and dispose of the assets
which totaled some 110 million koruny. Final dissolution of the
wholesale took place in July 1939. The productive plants, built up
over so many years, were also disposed of.
All democratic practices were stamped out by the Germans in
Bohemia. They, even demanded reparation for the German-owned
estates that had been purchased and distributed under the agrarian
laws of the early 1920’s. One of the greatest losses to the country was
sustained in the cutting down and carrying off of the great pine forests.
Although the Czech branch of the movement was allowed to con
tinue, apparently unmolested, at first, a violent campaign was started
against the cooperat’ves by the private merchants who cited as an
excuse the duplication of cooperative facilities and their competition
with the private retailers. In order to meet this criticism and prevent
further attacks, the various central cooperative organizations under
took consolidation of the movement in Moravia and Bohemia. The
Czech Central Union, the “ Unie” federation, and two smaller organ
izations were merged under the name “ Sdruzeni.” The wholesales
connected with them were also merged, the name V. D. P. being used
for the new body. In the city of Prague, where there was one large
retail association (belonging to the Czech Central Union) and several
smaller associations, one consolidated association was formed and the
excess stores were closed, reducing the total number from about 700 to
about 550. Similar consolidations in other districts resulted in the
closing of about 150 more stores. These, it was reported, were to be
turned over by the Minister of Trade to the private dealers. (In this
process two outstanding officials of the cooperative movement were
compelled to resign, one of them “ for reasons of health.” )
Thus, unity and increased efficiency in the cooperative movement
in Moravia and Silesia (aimed at since 1924) were obtained under
pressure from hostile sources. A report in the Review of International
Cooperation pointed out, however, that the success or failure of the
reorganized movement depended not on the cooperators but on
political factors.
No data on the status of the Czech consumed cooperative move
ment have become available since that time. A report late in 1943
indicated, however, that the agricultural cooperatives, at least, were
still a considerable factor, even though no longer free. In the socalled protectorate, nearly 6,400 associations were still functioning,
of which almost half were credit cooperatives. These latter had a
combined membership of about 750,000 in a population of about 9
million.
194
Cooperatives in Individual Countries
Little is known of cooperative events in Slovakia after the partition
of Czechoslovakia. The International Cooperative Alliance, report
ing on cooperative developments in 1941, stated that there were three
cooperative wholesales in operation, of which two— the German and
the V. D. P. (probably a branch of the V. D. P. in Prague)— were
quite small. The third was the wholesale of a farmers, organization
which had 772 cooperative associations supplying about 144,000
families in the small towns and villages of Slovakia. A fifth of the
population was reported to be registered with the cooperative associ
ations, for sugar, and the associations were characterized as “ trust
worthy factors in the official distribution and allocation of necessities.”
Among the credit cooperatives in Czechoslovakia were a small
number of associations identifying themselves as Jewish. In 1937,
these numbered 24 (there were also 2 cooperatives of other types),
all in Slovakia and Russian Subcarpathia (Ruthenia); there were
numerous others composed of Jews but not wishing to be regarded as
Jewish. The Jewish associations had 17,772 members in 1937, and
had made loans to the amount of 15,802,028 koruny during the year.
After the partition of Czechoslovakia, only 7 still remained in Slovak
territory; the others were in territory seized by Hungary. It was re
ported that they were all still functioning at the end of 1939, but
“ with some restrictions.” How they fared after the German antiSemitic laws began to be enforced is not reported but can be guessed.
As is well known, the unrest and rebellious spirit of the Czechs,
under the occupation, manifested itself in disorders, sabotage, slow
downs, and even the killing of prominent Nazi officials. In the en
suing reprisals by the Germans, many citizens were seized by the
Germans, including numbers of cooperative leaders. Among them
were* officials of the Postal Workers Cooperative in Prague. Another
victim was the president of the cooperative bank, who was hanged by
Heydrich on the charge of “ economic sabotage.” ®
• Sou rces .—The report on Czechoslovakia is based upon data from the following publications: Annuaire
Statistique de la RGpublique TchScoslovaque (Office de Statistique, Prague), 1934, 1936, 1937, and 1938;
Office de Statistique de la Republic TchScoslovaque Rapports No. 18,1921, No. 30,1922, Nos. 4 and 16,1924,
Nos. 17 and 23,1926, and No. 6,1927; Bohemia Under Hapsburg Misrule, by Thomas Capek (editor), Lon
don, Fleming H. Revell Co., 1915; The First Year of the Czecho-Slovak Republic, by Alexander Broz,
London, Twentieth Century Press, 1920; International Cooperative Bulletin (International Cooperative
Alliance, London), issues of April 1911, August 1912, January and July 1913, July 1914, September 1915,
July 1916, April 1918, April, July-August, and December 1919, January, August, September, and OctoberNovember 1920, July-August 1921, April, September, and October 1922, September, November, and De
cember 1923, January, June, August, and September 1924, January, May, July, September, and December
1925, March, April, and August 1927, May 1928, and March 1929; Review of International Cooperation (In
ternational Cooperative Alliance, London), issues of January, May, and August 1928, June and August 1929,
October 1931, January 1932, October 1933, January 1934, January, April, May, July, October, and Novem
ber 1935, February, June, and October 1936, April and July 1937, February and December 1938, April, Au
gust and September 1939, and December 1942; International Directory of Cooperative Organizations (Inter
national Labor Office), 1933, 1936, and 1939; Cooperative Information (International Labor Office), No. 31,
1926, No. 41, 1927, Nos. 5,14, and 19, 1928, and No. 2,1935; Cooperative Societies Throughout the World:
Numerical Data (International Labor Office, 1939); People’s Yearbooks (English Cooperative Wholesale
Society, Manchester, England), 1929,1930,1933,1934,1935,1936,1937,1939, and 1941; Monthly Labor Review,
November 1920; unpublished report to the U. S. Bureau of Labor Statistics, 1919, from H. B. Brougham;
Report of the Inquiry on Cooperative Enterprise in Europe, 1937 (Washington, 1937); Cooperative League
News Letter (New York), April 22, 1943; Cooperative Builder (Superior, Wis.), April 2 and December 24,
1942; News Flashes from Czechoslovakia Under Nazi Domination (Chicago), No. 193, July 12, 1943; New
International Yearbooks, 1939 and 1941; Jewish Social Service Quarterly (New York), December 1939; and
Rochdale Cooperator (New York) October 1,1943.
Germany
195
Cooperative Movement in Germany
The consumers’ cooperative movement in Germany had become
such an integral part of the lives of the workers that, in spite of Nazi
antagonism, it was not until 1942— about 9 years after the advent of
the Hitler regime— that the latter was able entirely to destroy it.
The cooperative movement in Germany started in 1849 when
Hermann Schulze, a local judge in the town of Delitzsch, started an
association to purchase raw materials for a group of joiners. It was
not until 1867, however, that legal status was achieved by the co
operatives in Prussia, with the passage of a cooperative law for that
State. In the succeeding years similar laws were passed in other parts
of Germany, and finally, in 1873, a national statute was enacted.
With that encouragement all forms of cooperative associations
developed, until by the time of the first World War the German co
operative movement was one of the most successful in Europe.
Although a working-class movement whose members had little
margin of economic safety, its inherent soundness enabled it to with
stand not only the hardships of World War I but also the series of
crises that occurred in the next 15 years— depression, inflation,
deflation, and then partial recovery toward the end of the twenties.
The great depression beginning in 1929, the bank shut-down, and
the prevailing unemployment (with drastically decreased purchasing
power of its members) presented almost insuperable difficulties.
Nevertheless, the movement had not only survived but was showing
unmistakable signs of recovery when the Nazis came to power.
The consumers’ cooperatives immediately felt the weight of the
oppressor. As champions of the small private retailers, the Nazis
quickly took steps for the control and eventually the extinction of the
cooperative distributive movement. However, its very great hold
upon the masses of the people who looked upon it not only as a source
of supply but as a creation of their own, built upon their hard-won
savings, forced the National Socialists to slow their rate of advance
upon it. Therefore, over 8 years went by before they were able to
achieve their goal of final suppression, under the decree of February
28, 1941. Even then more than a year was required before the
movement was finally absorbed into the Labor Front.
T ypes o f Cooperatives
The German cooperative movement appears to have appealed
particularly to three sections of the population: (1) The farmers,
who organized credit associations as well as marketing and processing
associations; (2) workmen, who started not only store associations
to supply their household needs but various kinds of productive
associations; and (3) businessmen, who saw in joint undertakings
of a cooperative character an opportunity to pool their buying power
and therefore organized associations for the purchase of their stock
in trade as well as those to manufacture articles needed in their
business. Enterprises of private business are not usually regarded
as part of the cooperative movement of a country, but in Germany the
official statistics have always included them. These numbered
about 1,300.
196
Cooperatives in Individual Countries
Among the genuinely cooperative types were some 20,000 savings
and loan associations (table 61), many of which carried on purchasing
of supplies for members, between 3,500 and 4,000 cooperative building
associations, about 1,600 retail store associations, less than 200
workers, productive and labor associations, and about 1,600 supply
associations buying raw materials and doing warehousing and market
ing for associations of workers (journeymen). Among the crafts in
which such cooperatives existed at the beginning of 1932 were bakers,
confectioners, millers, tailors, weavers, furriers, locksmiths, plumbers,
pipefitters, gunsmiths, ropemakers, saddlers, shoemakers, upholsterers,
bookbinders, butchers, workers in hides and skins, painters, cabinet
makers, wood turners and other woodworkers, building-trades workers,
hairdressers, basketmakers, potters, glaziers, stove fitters, roof tilers,
and gardeners.
The “ miscellaneous” group of associations contained probably as
varied a lot of associations as could be found in the cooperative
movement of any country. In one year alpne new. societies were
formed to carry on the following functions: Water supply, breeding
of fur-bearing animals, radio supply and operation, assistance to the
blind, cultivation of medicinal herbs, house repair, road construction,
sale of German books and writings, giving of apprentice training for
the metal industry, operation of sanitariums, convalescent homes and
old people’s homes, motor transportation of goods, publishing, silk
worm culture, hiring out of beach chairs, theatrical production, and
provision of information on matters related to “ transportation, amuse
ment, and intellectual life.”
The number of associations of each type, as shown by official
statistics, for specified years prior to the National-Socialist regime,
is given in table 61.
T
able
61.— Num ber o f Cooperatives 1 in Germany in Specified Years, by T yp e
Number of associations, January 1—
Type of association
1922
All typos ____
_
_ __
Credit (savings and loan), urban and rural......................
Consumers’ retail associations............................................
Housing (building) associations........ _................................
Supply, etc., cooperatives of craft groups........... ..............
Labor cooperatives__________________________________
Farmers’ marketing, processing, etc., associations.........
Private dealers’ purchasing associations *________ _____
Joint productive enterprises of private business8............
M iscellaneous.........................................................................
1923
1932
1933
46,615
49,052
52,328
51,795
20,566
2,411
3,064
3,503
317
14,818
1,333
603
(3)
20,931
2,475
3, 265
3,493
296
16,580
1,424
588
(3)
21,880
1,695
3,939
1,726
164
18,800
1,296
558
2,270
21,607
1,674
3,813
1,670
158
18,821
1,295
559
2,198
i Includes types not usually regarded as cooperative.
* Not usually regarded as part of the cooperative movement.
* No data.
Cooperative H ousing
(
Building) Associations
There appear to be very little data regarding the housing associa
tions. In 1914 these associations had a combined membership of
292,389. By 1928, the 2,706 associations affiliated to the Union of
Housing Federations had 633,629 members. Eight years later 3,490
associations were members of the Union and had 673,285 members.
197
Germany
That these associations formed an important source of housing in
Germany is indicated by the fact that in 1927, of 281,090 dwellings
constructed, 78,426 (27.9 percent) were erected by the cooperatives,
60.3 percent by private builders, and 11.8 percent by the public
authorities. Tabulation of the proportions built by cooperatives in
that year, by size of community, indicated that these organizations
were relatively most important in the cities, having built over half of
the total housing in large cities. In Berlin, 68.3 percent of the dwell
ings erected in 1927 were built by cooperatives.
Cooperative construction
as percent of total
dwellings
Population of—
5.1
Less than 2,000___________________________________
2.000 and under 5,000____________________________ 12. 7
5.000 and under 10,000___________________________ 18. 0
10.000 and under 20,000___________________________ 26.4
20.000 and under 50,000___________________________ 33.8
50.000 and under 100,000.....................— .................... 34. 4
100.000 and over__________________________________ 51.1
All groups_____________________________________
27. 9
In 1929 cooperative housing associations constructed 109,121
dwellings— 18,300 more than in 1928.
Credit and Agricultural Associations
Germany has the distinction of being the initiator of cooperative
credit. Hermann Schulze, who had been the first person to organize
a purchasing association, was also the first to start a credit coopera
tive in 1853. The subsequent spread of this type of association in
Germany was largely the result of his unremitting advocacy through
brochures, speeches, and organizing ability.
The Schulze-Delitzsch credit cooperatives were intended mainly for
artisans and small tradesmen in the urban districts, but larger busi
nesses also found them useful. An adaptation of the Schulze-Delitzsch
idea was worked out a few years later for the benefit of rural and farm
classes of the population, by Friederich Wilhelm Raiffeisen, burgo
master of a small town in a poor farming region. The associations
promoted by Raiffeisen were combinations of lending of money and
purchasing of farm supplies. The Raiffeisen associations spread
much more quickly than the Schulze associations and by the end of
the century outnumbered the latter by 3 or 4 to 1. By 1932, of
21,880 credit cooperatives, 19,910 (about 91 percent) were farmers’
organizations of the Raiffeisen type.
M ost of the urban credit associations were members of the German
Cooperative Union (Deutscher Genossenschafisverband). The Raiffei
sen associations were affiliated to the National Union of AgriculturalRaiffeisen Cooperatives.
Agricultural producing, processing, and marketing associations have
always formed one of the largest groups of cooperatives in Germany.
The credit associations have long led in numbers but, as noted, most
of these were farmers’ organizations. In 1932, counting the rural
credit associations, the agricultural cooperatives formed about 75
percent of all the cooperative associations in Germany.
The farmers’ cooperatives have taken varied forms. In 1932 the
largest group of agricultural cooperatives (aside from the savings and
198
Cooperatives in Individual Countries
loan associations) consisted of 6,677 organizations specializing in the
sale of one or more farm commodities. Electricity associations, num
bering 5,863, comprised the next largest group.
Nearly 90 percent of these agricultural cooperatives were members
of the National Union of Agricultural-Raiffeisen Cooperatives. At
the end of 1931 the associations belonging to the National Union had
a combined membership of 3,800,000. They had 27 regional whole
sales which marketed their members, products and purchased their
farm and household needs for them. In 1931 their purchases of sup
plies amounted to 448,389,996 reichsmarks and their sales of farm
products to 327,088,460 reichsmarks.
Distributive Cooperatives
By the beginning of 1923 there were 2,475 retail cooperative asso
ciations. Reports from United States consuls in Germany com
mented that the consumers’ cooperative movement had “ thoroughly
established itself as a permanent and substantial element in the national
economy” and that the associations had successfully survived the
“ business crises” of the post-war years. They had, however, lost the
controlling influence on prices which they had possessed before the
war.
In the next few years the economic situation rapidly went from bad
to worse. Money had less and less value. Before ordered goods
could be delivered, the amount of money required for its purchase
would be multiplied many times. Cooperatives, like other businesses,
suffered greatly from these conditions. A report by the International
Labor Office pointed out that by the beginning of 1924, “ after 10 years
of war and inflation, the distributive societies were practically in
ruins,” although externally the movement was still “ imposing.”
The currency was stabilized in November 1923. The effect was
that—in one month— the amount of money outstanding was reduced
from 1,955,001,736,412,000 (paper) marks in October 1923 to 589,841
(gold) reichsmarks 7 in November.
The cooperative associations were among the first to revalue their
accounts. Savings deposits of members were revalued at a rate very
favorable to the members, but of course this increased the difficulties
of the associations, for it made their burden of liabilities heavier. As
a result of the inflation and the subsequent revalorization their work
ing capital was practically destroyed and reserves were wiped out al
most completely. “ Indeed,” the International Labor Office com
mented, “ when stabilization was introduced the distributive move
ment had to be built up again from the beginning.”
Since 1903 the German consumers, cooperatives had had savings
departments and had relied upon them to a large extent for the
financing of the business enterprises. Savings deposited with the
associations affiliated to the Zentralverband amounted to 80,200,000
marks in 1913 and rose to 146,694,000 marks at the end of 1918. The
loss incident to the inflation and subsequent revaluation is indicated
by the fact that the savings deposits (in terms of the new gold cur
rency) amounted to only 49,500,000 reichsmarks in 1924. So success
ful were the associations in attracting new loan capital, however, that
by 1926 the amount had increased to 138,000,000 reichsmarks and by
1928 to 292,500,000 reichsmarks.
7 For par values of currency, see Appendix table, p. 278.
Germany
199
During this whole difficult period the consumed cooperatives
pursued a policy designed to strengthen and stabilize the movement.
Nonpurchasing members were removed from the roster, small associa
tions were merged into larger and sounder organizations, and a policy
of “ scientific management,” or “ rationalization,” was introduced
which resulted in improved efficiency and reduction of operating
expenses. These measures were largely responsible for the survival of
the movement, although a great many local associations (as also an
even greater number of private businesses) went into bankruptcy or
voluntary dissolution.
The remarkable recuperative powers of the consum ed cooperatives
and the loyalty of their members were demonstrated by the fact that
by 1928 this branch of the cooperative movement had reached and
exceeded its pre-war level.
However, forces were at work that were beyond the control of the
cooperators and their leaders. Shortly after the stabilization of the
currency in 1923, a downward trend in business activity and employ
ment set in which continued, with increasing velocity, through 1931
and came to a head in a number of economic disturbances not the least
of which was the shut-down of all the banks in Germany from July 13
to August 4, 1931. The number of unemployed during the winter of
1931-32 exceeded 6,000,000 in a population of about 65,300,000.
Various attempts were made by the Government to deal with the
situation. With a view to raising funds for relief,and at the same time
favoring the small retailer, on January 1, 1932, it levied a turnover
tax of 2-2H percent on all retail trade; in addition many States and
municipalities levied special trade taxes on the cooperatives. This
naturally reduced the cooperative earnings (and consequently their
patronage refunds), and this in turn reduced the purchasing power of
the members.
In September emergency decrees were issued which provided Gov
ernment credit for business organizations, in an attempt to bolster
the economic structure of the country. Only a very small part of
this was earmarked for cooperatives and that on such onerous terms
that only a part of the credit was ever applied for by the associations.
In an attempt to assist its local associations and enable them to
tide over, the Zentralverband in 1931 established an “ aid society,”
capitalized at 14,000,000 reichsmarks, and with supplementary capital
guaranteed by the Union. In spite of this the number of affiliated
associations fell from 988 to 985 during the year. The number of
individual members of the local associations fell by about 60,000,
but to some extent this was caused by striking from the roster the
names of nonpurchasing members. (In the 8 years ending with 1931
more than 1,600,000 names had been removed for this reason.)
Condition
of
Consumers’ Cooperatives Im m ediately Preceding
National-Socialist Regim e
About 65 percent of the consumers’ distributive cooperatives were
federated into two central organizations— the Zentralverband and the
Reichsverband. The Zentralverband was overwhelmingly a workingclass organization, over 70 percent of its membership being workers
either on farms or in industry, and it was strongly supported by the
trade-unions. In the Reichsverband (the more conservative of the
200
Cooperatives in Individual Countries
two federations), professional people and Government officials and
employees formed 31 percent of the membership. The farm and in
dustrial workers (slightly less than 50 percent of the total) were largely
connected with the Christian trade-unions.
The following statement shows the occupational distribution of the
membership of the associations affiliated to the two federations in 1931:
Zentral
verband
{percent)
(percent )
69. 2
2. 4
4 9 .7
.7
9. 3
4 .8
2. 5
1 2 .0
3 1 .0
5 .0
3. 2
10. 4
Reichs
verband
P rofessional m en an d G overn m en t em p loyees
Each of the federations had its own wholesale association, to
supply goods to the local associations. These were known, from the
initials of their names as “GEG” (Zentralverband) and “GEPAG”
(Reichsverband).
Table 62 shows the development of the Zentralverband from 1903
(the year of its formation) through 1932. The table also shows such
data as are available for the Reichsverband. It will be noted that
even during the depression, which reached its lowest point in 1932,
both GEG and the local associations affiliated to the Zentralverband
made substantial earnings, although a continuous decrease in both
earnings and the money volume of sales occurred from 1930 to 1932.
T
able
6 2 . — M em bership and B usiness o f Two M ain German Consum ers’ Cooperative
Federations and T heir M em bers in Specified Years
ZENTRALVERBAND
[For par values of currency, see Appendix table, p. 278]
Year
ions
______
1914....................................
1920....................................
1922....................................
1925....................................
1928....................................
1929...................................
1930....................................
1931....................................
1932....................................
Number
of mem
ber as
socia
tions
GEG (wholesale)
Their
members
Their sales
Amount of
business
Rm
573,000
666
1,718,000
1,109
1,291 • 2,714,000
3,161,000
1,350
1,110
3,382, Oil
1,024
2,803,232
2,859,516
988
974
2,940,308
2,979,210
968
2,895,985
949
131,786,107
486,419,059
0)
0)
616,188,362
1,045,962,404
1,176,294,809
1,240,327,868
1,160,156,341
944,198,074
Net earn
ings
Value of own
production
Rm
Rm
26,445,889
157,524,041
91,549,934
99,118,624
228,169,471
444,371,664
501,378,122
495,257,404
428,419,904
339,831,261
115,816
2,174,358
253,761
136,841
2,460; 583
4,361,350
4,946,369
4,360,812
2, 232,468
1,095,448
Rm
10,493,615
11,720,857
9,635,572
35,339,389
104,720,506
123,879,470
137,619,670
145,326,693
129,428,293
REICHSVERBAND
Year
Number
of mem
ber associations
Their
members
276
0)
277
263
786,758
764,960
792, 551
786,709
GEPAG (wholesale)
Their sales
Rm
1928....................................
1929....................................
1930....................................
1931....................................
No data.
0)
195,500,000
204,600,000
180,384,179
Amount of
business
Net earn
ings
Value of own
production
Rm
Rm
Rm
0)
0)
74,000,000
70,323,220
0)
Q)
0)
0)
(»)
0)
11,000,009
10,000,000
Germany
201
In 1931 (as shown by table 62) the two national federations of con
sumers’ cooperatives had in affiliation 1,231 local associations with a
combined membership of 3,765,919 persons, or about 6 percent of the
total population Counting their families, the movement was there
fore serving about 24 percent of the German people. However,
because their business was largely restricted to groceries, meat, and
certain household supplies, the cooperative associations accounted
for only about 5 percent of the retail trade of Germany. They em
ployed 65,310 persons in 13,575 retail stores.
GEG was a large importer of foreign goods, mostly purchased from
cooperative sources. Its imports in 1931 amounted to 11,200,000
reichsmarks, and represented commodities from 22 European countries
and Asia.
In 1932, GEG was producing about 40 percent of the goods it sold
to the retail associations. Its productive departments included 2 fish
canneries, 8 meat-products plants, 4 flour mills, 2 macaroni factories,
2 mills making malt coffee, 7 tobacco factories, 2 soap factories, 2
match factories, 2 clothing factories (and was part owner of a third),
and one plant each making vegetable and fruit preserves, cocoa and
chocolate, chemicals, cheese, textiles, and lumber. In addition it
operated a large farm, a weaving and dyeing shed for cloth, and a
stationery and printing plant. It started construction of a margarine
factory in 1931 but the depression and subsequent events prevented
its completion.
In the ssime year GEPAG, the wholesale of the Reichsverband, was
operating a printing plant, a coffee-roasting plant, and one establish
ment each making sausages, macaroni, soap, and cigars.
The local associations were also substantial producers, mainly of
perishable commodities. In 1931 the retail associations of the Zentralverband group produced goods valued at 317,559,105 reichsmarks.
The greater part of these goods consisted of meat products (such as
sausage) and bakery goods. In 1930, Reichsverband associations
manufactured goods valued at 28,000,000 reichsmarks. Here again,
bakery and meat products were the most important items, but the
output also included such commodities as macaroni, coffee, sauerkraut,
chocolate, distilled liquors, carbonated water, flour, and clothing.
In 1930 and 1931 the Zentralverband associations had net earnings
on their business amounting to 120,900,000 reichsmarks. Of tins
sum 12,340,604 reichsmarks were returned to members in patronage
refunds on their purchases, 56,014 reichsmarks were paid to members
in interest on their shares, and 99,035,915 were paid in rebates pay
able in merchandise. Thus, even in that 2-year depression period
the members of these associations directly benefited by the operations
of their cooperatives to the amount of 111,432,533 reichsmarks.
Social welfare.— The associations affiliated to the Zentralverband
had a pension fund to which association and employees contributed
equally and most of the consumers’ cooperatives devoted part of their
surplus to welfare purposes (burial funds, convalescent and holiday
homes, unemployment relief, etc.). As early as 1918 the Cooperative
Association of Hamburg had purchased a mansion on the shores of
the Baltic Sea, in which 100 children could be accommodated at a
time. The home was maintained from a special fund of the co588544°— 14------14
202
Cooperatives in Individual Countries
operative association and each child enjoyed a 4-week stay, free of
charge. In 1929 the wholesale GEG paid 1,000,000 reichsmarks
for a large holiday home in the Thuringer Wald, with accommodations
for 110 vacationers at a time. At Jena there was a special cooperative
association, whose duty was the operation of vacation resorts. It had
5,043 members in 1929 and was running 12 holiday homes. This
association received support not only from the cooperatives and
trade-unions, but also from several of the States and municipalities
and sickness-insurance funds. At its 1929 meeting the association
voted to organize a central body (in collaboration with all of the
supporting organizations) for operating holiday homes.
Cooperatives Under the N azis
The National Socialists, under Adolf Hitler, came to power in 1933.
Table 63 shows the number of associations of each type in each of
the 5 years thereafter. For comparative purposes the number at the
beginning of 1933 is also shown.
T
able
63.— N um ber o f Cooperatives 1 in Germ any, 1933 to 1938, by T ype
Number of associations, January 1—
Type of association
1933
1934
1935
1936
1937
51,795
51,820
53,631
53,499
52,878
51,988
Credit (savings and loan), urban and rural___________ 21,607
1,674
Consumers' retail associations......................... .................
3,813
Housing (building) associations........................................
Supply, etc., cooperatives of craft groups_____________
1,670
158
Labor cooperatives__________________________________
Farmers’ marketing, processing, etc., associations........ 18,821
1,295
Private dealers’ purchasing associations *.......................
559
Joint productive enterprises of private business *..........
Misnp.llariAOiis
2,198
21,323
1,606
3,698
1,667
153
19,518
1,293
557
2,005
20,866
1,634
3,616
1,751
147
22,001
1,315
554
1,747
20,552
1,582
3,507
1,890
144
22,429
1,284
550
1,561
20,283
1,512
3,452
1,948
20,005
1,488
3,372
1,917
22,403
1,241
542
1,497
22,239
1,201
533
1,233
All types
_ _ _______
_
____
_
1938
1 Includes types not usually considered as cooperative.
2 Not usually regarded as part of the cooperative movement.
It is apparent that craft and agricultural cooperatives increased in
number during the period covered in table 63. The increase in the
latter case appears to have been caused by the formation of a large
number of dairy cooperatives. In the case of all other types of asso
ciations, there was a diminution in number during the 6-year period,
and the associations of workers contracting their labor disappeared
altogether. In most cases the decrease represented not a contraction
of cooperative activity but an actual strengthening of the movement
by amalgamations of small associations. Such was not the case,
however, in respect to the consumers’ cooperatives. The decline of
these associations from 1,582 in 1936 to 1,488 in 1938 represented the
loss of the largest cooperatives in this branch of the movement. The
eonsumers, cooperatives appear to have been singled out, among all
the types of cooperatives, for the adverse attention of the Nazis because
of the determination of the latter to destroy all forms of business com
peting with the small private retailers. Accordingly, the large
privately owned department stores and chain systems also came under
their displeasure, but most especially the consumers, cooperatives
which had large organizations in all the cities and a network of smaller
ones throughout Germany.
Germany
203
The German agricultural associations had confined their activities
strictly to the economic sphere. They regarded themselves as part of
the capitalist system and, although they had business competitors,
“ they had no real opponents.” The agricultural associations showed
no opposition to the “ adjustments” made by the Nazis and the latter
apparently had no fundamental objections to the associations. The
farmers1 cooperatives were incorporated into the Nazi Agricultural
Estate and the important administrative posts in the associations
were filled by members of the National-Socialist Party.
The marketing and purchasing associations, although they had
only “ very limited freedom of action,” as the delivery of grain, milk,
etc., by farmers was very strictly regulated, nevertheless increased
their business and sales. About 45 percent of the cereal crops and
about 70 percent of the milk was handled by cooperative marketing
associations.
In 1935 the cooperative electricity associations formed about onethird of all organizations supplying electric power. A law of 1935
placed all electric-power organizations under the Ministry of Economy
and provided for the merger of all enterprises in a given region into
one. It also provided that an enterprise might be dissolved if it was
unable to supply the needs of the region. As the electricity coopera
tives were generally small, a number of them “ which for many years
had done pioneer work in the villages” were dissolved under this
provision.
co n su m er s’
c o o p e r a t iv e s
Among the first acts of the National Socialists was the merger (in
August 1933) of five central consumers’ cooperative organizations—
the Zentralverband, the Reichsverband, their two wholesales (GEG
at Hamburg and GEPAG at Cologne), and the Printing Association
of the Zentralverband. All of the five organizations were dissolved
and a new organization, Reichsbund der deutschen Verbrauchergenossenschaften, was formed. Although the authorities stated that
they had not seized these central organizations, but had merely taken
them into “ protective custody,” they abolished the right of member
ship voting, placed the management in the hands of Government
appointees, and gave orders to incorporate the whole consumers’
cooperative system into the Labor Front. Cooperatives were even
forbidden to receive the Review of International Cooperation, published
by the International Cooperative Alliance, of which the German
cooperative movement was a member.
At the same time, the whole consumers’ cooperative movement
was divided into 11 regional unions, each headed by a commissioner
who was given the authority to sit with the board of directors of the
cooperative associations and to “direct decisions.” Cooperative
sources stated that many of these commissioners were drawn from
the ranks of the private traders, and that some of them later obtained
full-time jobs as directors of cooperative enterprises which they then
proceeded to run like private businesses.
Less than a year after the merger that formed the Reichsbund, the
organization was again divided, the Reichsbund retaining only
propaganda functions and a new German Wholesale Society (without
even the name “cooperative”) being formed for purely trading pur
poses. The latter immediately issued a statement that it would oper
204
Cooperatives in Individual Countries
ate as a “ private economic enterprise/’ and that its services would
not be restricted to cooperatives but that it would sell to anybody.
During the next few years the attitude of the State public authori
ties toward the consumers’ cooperative movement varied from the
almost cordial (as in Wiirttemburg) to extreme suppression (as in
Gau). The measures taken by the central Government showed the
same vacillation.
The fact that the cooperative movement represented such a large
section of the population and was so intimately bound up with Ger
man economic life made it only prudent for the Government to move
upon it slowly. Realizing that the consumers’ cooperatives were
“ made up of the most substantial elements among the working
classes” whom the Nazis desired to bring into their fold, the Govern
ment resisted the demands of the retailers for the immediate extinc
tion of the cooperative movement. The Nazi director of consumers’
cooperatives (Karl Mueller) stated in November 1933 that he waa
endeavoring to “ solve the consumer cooperative problem in the inter
ests of the entire people.”
For nearly 2 years, during which the wavering Party policy re
sulted in a do-nothing attitude, the cooperatives were able to continue,
although under strict supervision. However, both membership and
business dwindled steadily, largely as a result of the panic induced
by the early Nazi acts.
Then, ostensibly to protect the movement, a law regulating coop
eratives was passed on M ay 21, 1935. The purpose of this law
(which was signed by Hitler, Dr. Schacht, and Graf von Krosigk)
was to bring about the extinction of the consumers’ cooperative
movement—painlessly if possible. Under the law no new cooper
atives could be formed without express permission of the Federal
Minister of Economy—a provision which effectively prevented any
expansion. As an inducement to voluntary liquidation by the
associations, the law made an appropriation of 60,000,000 reichs
marks to be used as a guaranty to the savings depositors of the asso
ciations, if dissolution was undertaken within a specified time. The
usual provision of cooperative bylaws, requiring a three-fourths vote
by a special meeting of the membership before an association could
be dissolved, was changed to allow an association to be terminated by
unanimous vote of the directors or a simple majority vote at a mem
bership meeting, convened at the request of one-tenth of the members
“ or their representatives.” No cooperative association was allowed,
after the passage of the law, to accept any additional deposits and
all savings departments were to be closed by December 31, 1940.
(This, of course, prevented the workers from investing in their own
enterprises and wiped out what had always been one of the main
sources of capital for the movement, besides placing a very great
burden upon the associations, which had the greater part of the funds
tied up in plant, stocks, equipment, etc. To refund all these savings
meant the liquidation of a large part of cooperative holdings.) Finally,
the law placed all the remaining cooperatives under the “ strict regu
lation” of the Federal Minister of Economy.
The law was expressly limited to the member associations of the
Reichsbund, but this organization contained practically all the
consumers’ cooperatives in Germany.
Germany
205
The International Cooperative Alliance pointed out that “ nothing
is more typical of the lack of freedom of the German cooperative
movement than the fact that the German consumers, cooperative
press does not dare to offer one word of serious criticism of this bill!”
(The Alliance had, early in 1934, deprived the German cooperative
movement of its membership in the Alliance on the ground that it
was no longer free.) It noted that “ propaganda for the ideals” of
consumers’ cooperation had been forbidden for some time and vision
as to the “ final goal of cooperation has long since disappeared from
the German consumers’ movement.”
In view of the express purpose of this 1935 law to induce the liqui
dation of the consumers’ cooperatives, it is significant that the 82
cooperatives (of about 1,200 affiliated to the Reichsbund) that were
singled out as being “ unsound” financially 8 included all the largest
associations in Germany, which together accounted for 60 percent of
the total capital of the movement and about half of the business.
The two Berlin associations alone had 284,000 members.
Some of the larger associations were closed, others were turned
over to former managers as private enterprises. The latter was the
situation with regard to the larger of the two Berlin associations.
In October 1935, Ministerialrat Dr. Zee-Heraeus, reporting on the
process of liquidation of the cooperative associations, remarked that
“ in trying to broaden the scope of the independent retailer the
Government is trying to transfer cooperative premises to inde
pendent traders.” He noted that of the 72 associations all or partially
liquidated, 10 percent of their 3,000 stores had been closed, 35 percent
had been turned over to independent dealers, and 55 percent had
been or would shortly be transferred to private companies. The
so-called “ privatization” method resulted in a hybrid that was neither
private nor cooperative. Some of the organizations were under
individual management and some were managed as subsidiaries by
the wholesale society.
Altogether the consumers’ cooperative movement lost about 1%
million members as a direct result of the law of May 1935.
In addition to the contraction incident to the dissolution of the
individual associations, with the consequent loss to the movement of
their membership and facilities, the central organizations had had
losses of productive plant. Under a law passed on January 10,
1936, the two match factories belonging to the former GEG were
turned over to the Match Monopoly (a private cartel), with the
proviso that their earnings were to be handed over to the Government.
Some of the other productive departments were either closed or
liquidated.
Data showing the effects of all the foregoing events upon the mem
bership and business of the local and central organizations are shown
in table 64. It gives the combined data for the Zentralverband and
Reichsverband for 1932 and 1933 and for the Reichsbund (formed in
1933) for 1934-37, the latest year for which data are available.
8 The International Cooperative Review of August 1935 remarked: “ The alleged financial instability of
the German consumers’ societies is a charge which carries no conviction to anyone who has known the
German cooperative movement during the last quarter of a century.”
206
Cooperatives in Individual Countries
T a b l e 6 4 . — M em bership and Business o f Reichsbund 91 in Specified Years
[For par values of currency, see Appendix table, p. 278]
Year
Wholesale
Number
of member
associa
tions
Their mem
bers
1,208
1,154
CO
1,113
(*)
1,162
3,654,402
3,334,400
3,210,000
2,130,000
2,094,500
2,010,900
Their sales
Amount of
business
Rm
19322................................................
1933 2 .................................................
1934...................................................
1935...................................................
1936....................................................
1937...................................................
1,095,095,769
818,488,609
660,100,000
502,000,000
510,000,000
532,069,098
Rm
339,831,261
279,940,844
295,266,000
289,419,000
309,999,304
330,009,321
Value of own
production
Rm
137,000,000
108,000,000
(3)
(3)
(3)
120,608,663
1 Formed in 1933 by merger of Zentralverband and Reichsverband end their wholesales.
2 Data represent combined figures for Zentralverband and Reichsverband.
8 No data.
The war broke out in 1939, after which time no statistical data
regarding the German consumers’ cooperative movement were
obtainable. Evidently, however, the cooperatives continued to oper
ate in some fashion until early in 1941. Then on February 28, Dr.
Walter Funk, Federal Minister of Economy, issued a decree putting
an end to the consumers’ cooperative movement not only in Germany
proper but also in the former Austria and the Sudetenland. This
decree provided for the transfer to the Labor Front of all property and
funds of both wholesale and retail associations in all these territories,
with the proviso that all the retail associations were to be “ converted
into model retail shops and turned over to private ownership.”
However, this latter transformation will, apparently, have to be post
poned until after the war, for it is intended that the shops shall be
given to veterans who fought at the front, as a reward for their services.
It remains to be seen how this can be done and at the same time
fulfill the Nazis’ promise to refund to the cooperative members their
equity in deposits, shares, and social capital, so that they “ will not
suffer any material loss.”
In announcing the new decree, Dr. Ley, head of the Labor Front,
made the following comments:
C onsum ers, coop era tiv e societies h ave alw ays been on e o f ou r stron gest o p p o
nents. * * * It m a y b e readily u n derstood th a t th e p rob lem o f th e c o
op eratives w as difficult fo r N a tion al Socialism t o solve w hen it cam e in to p ow er.
T h e w ork er saw in th e coop era tiv e m ov em en t som eth in g he h ad created an d in
w h ich he h ad in vested m a n y m illions o f capital, as w ell as m illions o f savings. F o r
th is reason, w e cou ld n ot have liq u idated th e coop era tiv es w ith ou t causing g^eat
d isqu iet am on g th e b roa d masses. Besides, w e saw th a t im p orta n t industrial
centers, an d even entire regions, w ere depen den t on th e coop era tiv e distribu tive
system . T h e industrial regions o f th e R hineland, an d pa rticu la rly o f O stm ark
[Austria], cou ld n ot be p rov id ed w ith fo o d an d oth er h ousehold good s w ith ou t th e
distribu tive m a ch in ery o f consum ers' coopera tives. M oreov er, there w ere a
great n um ber o f p ro d u ctiv e units w hich cou ld n ot be suppressed w ith ou t causing
serious eco n om ic disturbance. On th e oth er hand, t o let th em continu e m ea n t
unden iable p olitica l danger, fo r th eir ten m illion m em bers w ere all enem ies o f
N a tion a l Socialism an d elem ents o f the Centre P a rty [C a th olic] an d M arxism .
At the same time he stated that the taking over of the cooperative
associations would enable the Government to use cooperative personnel
to man the machinery for retail distribution in the newly acquired
territories in the East and to operate the businesses seized from the
Polish and Jewish communities there.
Hungary
207
Under the reorganization the separate branches of the movement—
wholesaling, productive, and retailing—were to be made subsidiary
enterprises of the Public Works Management (the operating machinery
of the Labor Front). The announcement of the decree was accom
panied by an appeal to the cooperative employees to do their utmost
to “ explain away and eliminate any cause for unrest among the
members.,,
By the middle of 1942, the “ reorganization” had been to a large
extent completed. Although the size of the individual cooperatives
had been one of the main points of criticism by the Nazis, under the
reorganization a large-scale regional concentration was effected, far
beyond that ever achieved by the cooperatives. At the same time
the capital of the organizations was much enlarged— a circumstance
that led the International Cooperative Alliance to wonder whether
this might not represent another manifestation of the expansionist
tendencies of the Labor Front, whose Labor Bank became one of the
largest in Germany and which practically took control of the banking
machinery in the conquered territories.
The cooperative press (which had long ago lost its freedom of
expression) ceased publication on January 1, 1942. In view of the
other developments, this was a logical step, since (in the words of the
International Cooperative Alliance) “ it had no longer a cause to defend
nor a public to serve.”
Thus, after 9 years under Nazi rule, the German consumers'
cooperative movement came to an end. However, there still remain
thousands of workers— cooperators— and their families to whom the
cooperative is a tradition and a necessary way of life and it is upon
them that the task of rebuilding the movement after the close of the
war will depend.9
Cooperative Movement in Hungary
In Hungary the cooperative movement had, prior to the outbreak
of the present war, attained an outstanding pliace in the economy of
the country. It was estimated, in 1937, that cooperatives were
serving about 45 percent of the population. Their central organi
zations had attained leading positions in both the distributive and
export trade of the country. As far back as 1935 the International
Labor Office pointed out that almost every commune in Hungary
had a consumers’ cooperative society, and commented that: “ It is
probable that the Hungarian consumers’ and credit cooperative
movement has now reached the point where it meets the country’s8
8 Sou rces .—1The report on Germany is based on data from the following publications: Report from United
States Commissioner at Berlin, August 11, 1920; United States consular reports, July 1922, February 21,
May 25, and June 14, 1923 (No. 335), November 20, 1924 (No. 34), September 28, 1925 (No. 424), May 24
(No. 724) and December 20, 1926, January 4,1927, June 30 (No. 516) and October 11,1932 (No. 605), June 18
(No. 897) and November 13,1933 (No. 1033), August 1,1935 (No. 274), and August 4,1941 (No. 2882); Coopera
tive Information (International Labor Office), 114/A, No. 62,1927, Nos. 4 and 19,1928, Nos. 2, 4, 7, and 10,
1929, Nos. 3,4, and 13,1930, Nos. 11 and 14,1931, No. 5,1932, No. 2,1933, No. 2,1934, No. 5,1935, No. 3, 1936,
No. 3, 1937. Nos. 3 and 11, 1938, and No. 4, 1941; Review of International Cooperation (International Co
operative Alliance, London), issues of February, May, September, and December 1932, February 1933,
February 1934, July and August 1935, February, September, and December 1936, July 1937, August 1938*
June and July 1941, and June 1942; People’s Yearbooks (English Cooperative Wholesale, Manchester,
England), for 1933, 1934, and 1935; International Directory of Cooperative Organizations (International
Labor Office), 1929, 1933, and 1939; Cooperative News Service (Cooperative League, New York), March
25,1927; Consumers’ Cooperation (Cooperative League, New York) July 1933; Cooperative Builder (Central
Cooperative Wholesale, Superior, Wis.), August 15, 1936; Fascism (International Federation of Trade
Unions, Amsterdam), June 29, 1933, and August 22, 1936; Konsumgenossenschaftliche Rundschau (Ham
burg), April 21, 1923; Wirtschaftdienst (Hamburg), October 2, 1925; and Jahrbuch des Zentralverbandes
deutscher Konsumvereine (Hamburg), 1933.
’208
Cooperatives in Individual Countries
needs, and that any further increase in its strength will be in the
form of the economic stabilization of existing societies rather than
the creation of new ones.”
The Hungarian cooperative movement differed from that of most
other countries in that most of the central organizations were formed
either with the help of the Government or as a result of the social
initiative of individuals. The central bodies then took the lead in
forming local associations. This reversed the usual (and recom
mended) procedure, under which central organizations are formed
only after a network of local associations reaches the point of needing
wholesale or educational service which they then federate to provide.
In Hungary by far the greatest part of the cooperative movement
was among the farmers. They, however, were released from serfdom
only in 1848, after which the country was plunged into a serious
depression. These peasants, previously unaccustomed to any kind
o f independent action, were totally unable to meet the situation by
any action of their own. Their plight was of serious concern to some
o f the more socially enlightened members of the upper classes, among
them Count Alexander K&rolyi. Through his initiative both a
•central union and wholesale, “ Hangya” (the “ Ant” ), and a central
credit organization were founded in 1898.
Thereafter, for many years, the development and spread of the
^cooperative movement was carried on mainly through the efforts of
the educated people— teachers, priests, notaries, doctors, and even
members of the nobility. Being naturally intelligent and receptive,
the peasants quickly became accustomed to cooperative activity
and by the end of the first decade had begun to participate in the
management and direction of their cooperatives.
As Hungary is primarily an agricultural country, the farmers have
remained the largest component of the cooperative movement there.
However, the industrial workers to some extent, as well as the middleclass people (including employees of the Government and the State
railroads), also formed cooperative associations.
There were also several other branches of the cooperative move
ment that grew in the more usual way— from the ground upward.
These included the cooperative dairies; the land-leasing associations;
the associations of workers contracting their labor for such tasks as
flood control, irrigation, and road construction; and cooperative
associations for credit and production in small-scale industry.
Although, as noted, the cooperative movement developed separately
among the various social classes, there was always “ harmonious
collaboration” among the different branches of the movement.
Cooperative leaders recognized, however, that the lack of a closely
integrated organization including all types of cooperatives was “ a
serious drawback.” A central organization (the Union of Hungarian
Cooperatives) was formed in 1909 to act as representative for the whole
movement and was extremely successful at first/ It was, however,
reported to have been “ paralyzed” by the war of 1914-18 and existed
largely in name after that time.
Official recognition has been accorded the cooperative movement
for many years. In 1927, when the upper House of Parliament was
revived, five representatives of the cooperative movement were
seated in that body. One of these was elected by the nobility, one
by the agricultural interests, and the other three were appointed.
Hungary
209
Up to 1928, cooperatives were accorded certain tax privileges as
well as low-interest loans from the Government. These privileges
were withdrawn in that year.
In recent years the Government has more and more made use o f
the services of the cooperative movement in Hungary, particularly
that part represented by Hangya. This has, of course, entailed an
increasing measure of control. It is not known to what extent the
totalitarian regime has vitiated the independence and freedom of
action necessary for the sound development of the cooperative
movement.
T ypes o f Cooperatives and Their Activities
The latest data showing the number of associations of various types
in Hungary were collected by the Statistical Office of Budapest and
relate to the year 1935, as follows:
N um ber
All types___________________________________________________ - — - _____ 4, 502
D istrib u tiv e co o p e ra tiv e associa tion s________________________________ ________ 1, 800
C o o p e ra tiv e cred it associa tion s_______________________________________________ 1, 4 0 2
C o op era tiv e insurance a ssocia tion s___________________________________________
11
A gricu ltural m arketing, p rod u ctive, an d purch asing associa tion s_________ 800
W ork ers’ p ro d u ctiv e a ssocia tion s:
L a b o r a ssocia tion s___________________________________
29
C raftsm en’ s associa tion s__________________________________________________
16 3
W ork sh o p s________________________________________________________________
24
H ou sin g associa tion s___________________________________________________________
105
O ther ty p e s :
A ssociation s op era tin g clu b h ou ses____________________________ - __________
73
M in in g associa tion s_____ ______
1
T ran sp ort co o p e ra tiv e associa tion s______________________________________
10
M iscella neou s_____ _ __________________________________ ;____________________
78
More than three-fourths of all these associations were federated
into central associations in their particular field.
With the exception of certain specialized marketing associations
(such as those of beekeepers, fruit growers, and distilleries), most of the
distributive and agricultural cooperatives were affiliated with Hangya.
Notable exceptions were the consumers’ cooperatives among the indus
trial workers and the large retail organizations of the State railway
employees and of the Hungarian civil service employees. Hangya,
although composed mainly of farmers’ cooperatives, also had associa
tions in some of the large towns and cities.
The figures shown in the foregoing tabular statement included some
associations not genuinely cooperative. The 50-year old law under
which cooperatives were formed permitted the organization, under it,,
of pseudo-cooperatives that were really profit-making enterprises.
Not until 1937 was a really cooperative code drafted.
Credit cooperatives.— The credit associations are one of the oldest
forms of cooperative activity in Hungary, and have always operated
in close collaboration with the Government. Their central organi
zation, the Central Institute of Cooperative Credit Associations, was
started in 1898 with funds subscribed partly by private persons and
partly by the State. Under a law (Act No. A X X ) of 1920, every new
credit cooperative was required to affiliate with the Institute.. Of
about 1,400 credit associations in 1935, slightly over 1,000 were
members of the Institute.
210
Cooperatives in Individual Countries
Workingmen’s consumers’ cooperatives.— The spread of consumers*
cooperation among the industrial workers, not being fostered by any
organization, had spread more slowly than was the case with the
Hangya associations. The foremost workmen’s cooperative in
Hungary was the General Distributive Association at Budapest,
founded in 1904 with funds advanced by well-to-do citizens. This
method of financing was opposed by the trade-unions, but after 3
years’ operation by the association they were won over to its support.
In the great depression the association was able at first to hold its
own surprisingly well, and continued its practice, begun in 1926, of
presenting every member whose annual purchases had amounted to
over 400 pengos 10 a free life-insurance policy.
The long-continued depression period and the failure of the workers’
savings bank proved to be too much for the General Distributive
Association, which was forced to liquidate in 1939. In order to pre
vent the loss of the workers’ savings, invested in this association,
Hangya (at the request of the Government) took over part of its
assets and shops and continued its service.
Workers’ productive associations.— The small group of workers’ co
operatives in Hungary had its own central organization (Central
Union of Handicraftsmen’s Cooperatives), formed in 1920. A con
siderable variety of industries was represented among these associ
ations—woodworking, building construction, shoemaking, tailoring,
and various home industries. In 1928 there were 71 of these asso
ciations with a combined membership of 17,712. By 1934, however,
the number had fallen to 52 and the membership to 7,414.
Public employees’ associations.— One of the largest retail associations
in Hungary was the Hungarian Civil Servants Cooperative Asso
ciation, established in 1893. In 1934 its members numbered over
55,000 and its business exceeded 19,000,000 pengos, nearly a third of
which (6,385,000 pengos) represented goods produced in its own
factories.
The employees of the State railroads also had a large retail associa
tion, with many branches throughout Hungary. It had a business in
1932 amounting to 3,600,000 pengos.
H angya Associations9 1 8 9 8 -1 9 3 5
To a considerable degree, the history of cooperative marketing and
distribution in Hungary is the history of the farmers’ wholesale coop
erative, Hangya. As already noted, this association— the Society for
Consumption, Sale, and Production, of the Hungarian Farmers’
League— was formed in 1898, on the initiative of Count Alexander
Karolyi, using privately subscribed funds. There were no local asso
ciations at the time, but immediately after the establishment of
Hangya, the latter proceeded to organize local distributive coopera
tives among the farmers. Later it extended its activities to the towns
and cities. Each association was pledged to make all of its wholesale
purchase through Hangya, provided the goods were procurable through
it and provided the prices were at least as low as offered by private
wholesalers. In spite of the difficulties of manpower, supply, and
communication, Hangya showed a continuous development during
10 For par values of currency, see Appendix table, p. 278.
H ungary
211
the first World War, achieved in spite of the political upheaval and
turmoil in Hungary. The dual monarchy of Austria-Hungary was
overthrown and a republic was established in 1918 by the revolution
of October of that year. It, in turn, gave way to a short-lived Com
munist government under Bela Kun in 1919. In 1920 the various
parties of the Right Wing (aided by Rumania) succeeded in over
throwing the Bela Kun regime and establishing a Regency, with
Admiral Horthy at the head.
In the dismemberment of Hungary under the Treaty of Trianon,
Hungary was reduced to a third of its former size. Slovakia became
part of the new country of Czechoslovakia, Transylvania was taken by
Rumania, and Croatia and Slovenia became part of the new kingdom
of Yugoslavia. In this transfer, over 1,300 Hangya associations thus
became foreign associations. A t the end of 1920 there were only 1,752
Hangya associations left in Hungary.
B y 1922 Hangya had enlarged its scope by admitting to member
ship workmen's as well as farmers' cooperatives. One oi its members
was the Haztartas Cooperative Association in Budapest, which by
1922 had 36,772 members and supplied about 20 percent of the people
of the city in its 77 stores. The aim of this association was to organize
the middle class in the towns. Another association, the “ Pannonia,"
was started to supply the associations of the Christian-Socialist rail
way men, postal workers, and tobacco workers.
The economic condition of the country went from bad to worse in the
next few years. As Hungary is an agricultural country dependent
upon its exports, the loss of foreign markets had a disastrous effect
upon its internal economy. In 1924 the League of Nations appointed
a commissioner to take charge of its finances, and floated a $50,000,000
international loan to be used for rehabilitation.
Hangya's affiliated associations experienced great difficulty in
renewing their capital after the deflation, particularly as Hungarian
cooperative associations (except credit cooperatives) were not allowed
to accept savings deposits from members. Regarding the credit coop
eratives, it was reported that the value of their shares and deposits was
practically wiped out. By 1926, however, Hangya itself had com
pletely recovered.
In the depression that began in 1929, Hungary felt severely the
slump in prices and the restrictions on trade imposed in the various
countries in the attempt to alleviate conditions. As the members of
the Hangya associations were mostly farmers whose products were
among Hungary's largest exports, they also encountered extremely
hard times and a considerable number of associations had to be
liquidated. By 1933, however, signs of improvement appeared. An
unusually rich harvest in the fall of 1932 improved the members'
purchasing power somewhat. This, combined with improved condi
tions resulting from Government controls on foreign trade and on the
national currency and the lightening of farmers' debts, was reflected
in the increased business of the cooperative associations.
The trend of membership and sales of Hangya through 1935 is
shown in table 65.
212
T
able
Cooperatives in Individual Countries
65.— M em bership and Operations o f H ungarian Cooperative W holesale, H angya,
1910-35
[For par values of currency, see Appendix table, p. 278]
Number of mem
ber associations
Year
992
1,195
1,276
1,307
1,386
1,940
1,945
1910.
1912.
1914.
1915.
1916.
1918.
1921.
Amount of
business
Net earnings
K ro n e n
K ro n en
19,016,419
28,000,000
30,218,913
46,064,332
57,531,133
126,775,127
1,890,000,000
P engds
1926.
1928.
1930.
1932.
1934.
1935.
0)
1,698
0)
1,573
>1,541
1,488
68,529,255
73,745,181
63,576,587
46,635,460
50,627,421
57,238,272
139,732
185,931
<9
439,656
758,197
<9
'
450,000,000
P engd s
433,428
646,258
(0
8
210,406
i No data.
* Data are for 1933.
Table 66 gives data on the membership and operations of the
associations affiliated to Hangya. The result of the currency infla
tion is shown strikingly in 1921.
T
able
6 6 . — M em bership and B usiness o f H angya Cooperatives in H ungary, in S pecified
Y ears , 1910-37
[For par values of currency, see Appendix table, p. 278]
Number of
associations
Year
I9in __ ....
1918_____
1921 ...
___________________________ ____
____
__________________________________________
______________
____ _____________
1928__________________
________________________
1932
_
_ ____ .. .
..
_ _
1935 ___________ ______ _____ ________________
1937
.
.
____
________
Their
membership
992
1,940
1,945
156,563
658,267
795,137
1,698
1,573
1,488
1,481
714,918
>664,024
627,693
630,000
Their sales
K ro n en
38,216,954
124,926,975
3,000,000,000P engd s
122,441,033
66,539,432
81,148,481
91,306,000
i No data.
* Data are for 1930.
PRODUCTIVE ACTIVITIES
In 1916 the Hangya Industrial Company (Ltd.) was organized,
for purposes of production. By 1922 it was operating 12 factories
producing such commodities as soap, tooth paste, shoe polish, blacking,
starch, matches, brooms, brushes, rope, cord, knives and forks,,
mustard, candy, and various liquors. By 1926 it had added chemicals
and costume jewelry to its list and early in the thirties started the
manufacture of lubricating oil and dyes.
Until 1929 Hangya owned one of the largest match factories in
Hungary. In that year the Government granted a monopoly on
matches to the Swedish American Match Trust, and Hangya was
compelled to sell its factory to the trust.
Hangya has never reached the importance as a manufacturer
attained by the wholesales of certain other European countries.
Its manufactures never exceeded 12 percent of the amount of the
distributive business.
H ungary
213
Place o f Cooperation in the E conom y o f H ungary
Ever since the first World War, the cooperative movement, es
pecially as exemplified by Hangya, has played an important part in
the life of Hungary. With the exception of a few urban cooperatives
connected with the Social-Democratic Party, the cooperatives in
Hungary have never taken any part in politics. Probably partly
for this reason and partly because of the wide economic vision of the
cooperative leaders, Hangya especially received much official recog
nition. In all of the recurrent crises, economic and financial, Hangya
proposed or assisted in constructive measures to meet the situation.
At the celebration of Hangya’s fortieth birthday in 1938, the Prime
Minister paid tribute to its constructive accomplishments in improv
ing the living standards of the agricultural population, and promised
a continuance of Government support.
W ELFARE W ORK
Hangya was the first employer in Hungary to pay family allowances
to its employees,11 and as early as 1910 it had established a system
of old-age pensions for its superannuated workers. The system ap
parently had to be abandoned during the war of 1914-18 and the early
post-war period, but by 1928 the organization was again making
regular appropriations for pensions.
In 1922 Hangya and the Central Institute of Cooperative Credit
together established a modern cooperative hospital in Budapest.
This hospital was enlarged and provided with additional surgical
equipment in 1938.
Hangya also entered the field of housing when it acquired land
near Budapest and constructed modern low-rent dwellings for its
workers; this project was enlarged in 1938. In allotting dwellings,
preference was given to the larger families. In the same year a block
of flats was built, using money from the pension fund.
E X P O R T B U SIN E SS
“ Futura,” Hangya’s trading and export company, was established
in 1919 by joint action of the State, the Cooperative Credit Institute,
and Hangya, as a result of the conditions that followed in the wake of
successive changes in government and the occupation of Hungarian
territory by the Rumanians.
The Horthy Government came into power in 1920. At first hostile
to cooperatives, it gradually realized the importance of the cooperative
movement. Under the “ planned economy” inaugurated under the
Horthy Regency, the possibilities of the cooperative network were rec
ognized and more and more use was made of the associations as ma
chinery for collection and export of agricultural products.
In 1923, when the Government undertook the export of wheat to
Switzerland and Bavaria in order to bolster the currency on foreign
exchange, Futura was given the task; later, it also handled in the
same way other State-controlled goods—wool, onions, newsprint
paper, agricultural machinery, etc. When the State came to the
rescue of farmers who had lost their machinery and tools during the*
u The general family-allowance system was introduced in Hungary in 1939.
214
Cooperatives in Individual Countries
revolutions and Rumanian occupation, Futura distributed 37,500
machines and 397,000 tools for the State.
After the abolition of State control of commodities, Futura em
barked upon a program of improvement of quality of agricultural
products. Through its operations on the market it was able to obtain
better prices for the farmers, also. It had export relations with co
operative organizations in German Austria, Czechoslovakia, Switzer
land, Italy, and Poland.
By the end of 1933 Futura was characterized as the leading produce
organization in Hungary. Its marketing business rose steadily each
year, from 5,463,302 pengos in 1934 to 30,592,400 pengos in 1937, and
it had a Government monopoly in the export of camomile and paprika.
Mills were being built in various sections of the country, to handle
the paprika business.
D IST R IB U T IV E A N D M A R K E T O PER ATIO N S
The year 1934 was the most critical period of the depression in
Hungary. In that year the Government forced a reorganization of
the whole distributive cooperative movement, under Law No. X X I.
Cooperatives were divided into two classifications—urban and rural.
T o the Hangya network were allotted associations in the rural dis
tricts. Associations in towns and cities were allocated to the Hun
garian Civil Servants’ Cooperative Society. This forced the liquida
tion of Hangya’s Budapest association, H&ztartds, and of the large
State railway employees’ association, Konzum. The General Dis
tributive Association— the workingmen’s cooperative at Budapest—
was left untouched at that time but was taken over by Hangya several*
years later.
The reorganization resulted in eliminating duplication of coopera
tive facilities and consequently in a general reduction of overhead
expenses. Also, Hangya subjected its affiliated associations to a
searching examination as to financial soundness, and as a result 42
associations were liquidated or consolidated with other associations
during 1935. The 1,488 affiliates at the end of the year were operating
2,785 stores. Hangya territory was divided into 140 sections, for
purposes of auditing and technical improvement, and a Hangya repre
sentative was placed in charge of each.
This period of gradual recovery was reflected in increased coopera
tive business and earnings. Net earnings of 212,406 pengos enabled
Hangya to pay a 2-percent patronage refund, after a barren interval
of 7 years, and to start a new reserve fund to replace the reserves
wiped out by the previous losses. The wholesale had succeeded in
obtaining a fair share in the Government export quotas and had been
accorded representation on all of the State-controlled syndicates and
commissions handling the various exports.
Another good harvest in 1936 speeded recovery and in that year
the distributive business of Hangya amounted to 69,330,760 pengos—
nearly the pre-depression volume.
At the end of the year the more than 600,000 members of Hangya’s
affiliates and their families represented about a fourth of the popula
tion. Hangya was doing about one-eighth of the total trade, was the
largest distributor of wine in the country, and had become “ the most
important commercial institution in Hungary.” It supplied the
215
H ungary
farmers with all their household and farm needs and in addition
marketed their products through eight central associations handling
specific lines. One of these dealt in the products of home industry.
It was reported that this organization was “ providing the women in
the villages with work and occupation during the idle winter months,
and the ever-increasing demand from overseas proves the excellence
of the quality.”
In the spring of 1938, when the price of cattle had fallen to an
unusually low level, the Government authorized Haiigya to make
large purchases on the market and to can the meat in its factory.
Again, in the autumn of the same year, action by Hangya prevented
a rise in the retail prices of lard, bacon, and other foodstuffs. In that
year, for the first time in the history of Harigya, not one of the mem
ber associations had a loss on the year’s operations.
In the same year, at the request of the Government, Hangya took
over part of the assets and shops of the failing General Distributive
Association of Budapest, and formed a new association, in order to
assure a continuance of supply to the former members. By this step
Hangya resumed operations among urban industrial, workers— a func
tion it had lost in 1934 under the reorganization law that restricted
its activities to rural areas.
In 1939 in the interest of economy and efficiency, the subsidiary
marketing companies were reduced to departments of Hangya.
There was a considerable expansion in the goods produced in Hangya
factories. Operating expenses of the whole Hangya enterprise for
the year reached a low of 5 percent and net earnings totaled 1,126,989
pengos.
The development of the wholesale and marketing business and of
the productive plants since 1934 is shown in table 67.
T able
67. — M em bership and Business o f Hungarian Cooperative W holesale, Hangya ,
1935-41
[For par values of currency, see Appendix table, p. 278]
Year
______________
1936..........................................................................
1937
____
_____
1938
____________ - ____
1930
______
_______
194A
___________________
1941 ......................................................................
193*5
Number
of mem
ber asso
ciations
1.488
1.480
1.481
1.489
1,783
(1)
0)
Amount of business
Wholesale
distributive
Marketing
P engos
Pengds
57,238,272
69,330,760
80,063,757
98,413,829
127,569,299
162,400,000
230,000,000
13,205,336
23.037.000
30,592,400
41.871.000
84.489.000
91,900, U00
129,100,000
Value of own
production
P engds
4,355,879
3,596,2i 8
4,783, C95
7,398. 559
11,352,734
15.600.000
28.600.000
i No data.
Developments Since Outbreak o f Present W ar
Hungary was drawn into the present war, on the side of Germany,
almost from the beginning. Its troops were among those that
invaded Czechoslovakia in March 1939. Hungary received as its
reward parts of Czechoslovakia that it had lost 20 years before, under
the Treaty of Trianon. In this reacquired territory several hundred
former Hangya associations were brought back into membership; to
216
Cooperatives in Individual Countries
supply them Hangya opened 7 new wholesale warehouses. The rean
nexed territory also contained about 200 associations which had been
formed in the interval after the Treaty of Trianon; they had estab
lished their own wholesale, “ Hansa,” which they continued to operate
after the reannexation.
In 1939 when Carpatho-Ruthenia was returned to Hungary,
Hangya established a new retail association there, with 50 stores.
From 1939 through 1941 Hangya’s distributive and marketing
business rose by nearly 70 percent.
The International Cooperative Alliance, reporting Hangya's sales
for 1940 and 1941, commented in the Review of International Co
operation (November 1942) as follows:
* * * There can be no doubt that the stricter control and the planning of
agricultural and industrial production, as well as the regulation of trade and
distribution, must greatly affect cooperative development and freedom of action.
The general policy of the Government so far as the cooperative organizations are
concerned seems to be motivated by a recognition of the economic value of the
cooperative apparatus and the desire to use it for their own ends, while the social
aims of cooperation, the new view of society for which progressive cooperation
stands, must of necessity be alien to their more or less totalitarian or autocratic
view of society. Government interference, not without danger even when
offered in the form of disinterested assistance, becomes doubly dangerous if the
Government, consciously or unconsciously, dilutes and weakens not only the
voluntary character but also the idealistic social basis of cooperation. How far
this danger has already materialized and how far, in addition, State officials have
penetrated into cooperative organizations and diluted their leadership, we do not
know, but there is no doubt that the danger is real.
In Hungary, before the war, the cooperative wholesale society Hangya and its
subsidiary organization Futura were entrusted by the Government with more or
less monopolistic functions in the collection, marketing, and export of agricultural
produce, the scope of which has been enlarged during the war in the field of
agricultural marketing and the supply of the rural population, particularly in the
territories annexed by Hungary. The growth of the Hangya and the public
recognition it has received have aroused the suspicion and opposition of the
private traders, and the friction between the two groups of interests recently
prompted a public statement by the Minister of Trade, Josef Varga, to the
effect that in a “ State-directed economy,” cooperative organization as well as
private trade must find its proper place. “ The new economic order cannot do
without the cooperative organization, though, on the other hand, it cannot allow
ithe cooperative societies with their greater capital resources to endanger the legiti
mate interests of private trade.” This statement is a remarkable recognition of
the exceedingly strong position which the Hungarian cooperative societies have
attained in the trade of their country.12
Cooperative Movement in Poland
The Polish cooperative movement was characterized by a multiplicitv of small associations, but reached a large proportion of the
population. Even as early as 1920, it was estimated by the Inter
national Labor Office that the consumers' cooperatives were supplying
20 percent of the Polish people. Under a law passed in 1934 (largely
as a result of the extreme depression in agriculture and the resultant
effect upon the agricultural cooperatives) there was a considerable
u Sou rces .—1The report on Hungary is based upon data from the following publications: Internationa
Cooperative Bulletin (International Cooperative Alliance, London), issues of May and November 1911,
March 1913, April 1915, July 1916, January 1918, January 1919, July 1920, May-June and November 1922,
and May 1923; Review of International Cooperation (International Cooperative Alliance, London), issues
of March and April 1927, June, July, and October 1928, November and December 1929, February and
June 1931, October and November 1932, January, March, and November, 1934, May, August and December
1935, May 1936, June and November 1937, February, June, and August, 1938, June 1939, June 1940, and No
vember 1942; International Directory of Cooperative Organizations (International Labor Office), 1929,1933,
and 1939; Cooperative Information (International Labor Office), No. 12, 1935, and No. 13, 1937; People’s
Yearbooks, 1930,1933,1937,1938,1939, and 1941; and New International Yearbooks, 1924,1925,1941, and 1942,
217
Poland
amount of amalgamation both of local associations and of federations
(notably the so-called “ auditing unions” ) by which the movement was
decidedly strengthened. The Polish Government was given power
to interfere in the affairs of the cooperatives but was reported to have
exercised this power wisely.
The movement itself was neutral and nonpolitical, except in the
Ukraine. It was encouraged by both the Government and the
Catholic Church,13 and the public authorities had established a chair
of cooperatives in the University of Warsaw, as well as a school for
employees of agricultural cooperatives.
Under the 1934 law, the 26 auditing unions were reduced to 10,
representing various social groups as well as the different national
minorities. Thus there were two auditing unions for German associa
tions, two for Jews (one Zionist and one Orthodox), and one each for
the Ruthenians and Ukrainians, as well as four unions for Polish asso
ciations. The Polish associations included (1) “ Spolem” (“ To
gether” ), the General Union (and wholesale) of Distributive Coopera
tives of the Polish Republic, serving consumers’, workers’ productive,
and labor associations; (2) the Auditing Union of Army Cooperative
Societies (also served by Spolem); (3) the Union of Agricultural and
Provident Cooperatives of the Polish Republic, combining credit,
marketing, processing, and productive associations; and (4) the Union
of Cooperative Societies and [Government Employees’ Associations,
combining credit, housing, and construction associations. All of the
unions were on friendly terms, and most of the central organizations
were members of the Scientific Institute for Cooperation.
The abundance of small associations is indicated by the fact that the
average membership per association was only 250— a very small size
for European cooperative associations— and that in the population of
about 35 million there were some 14,000 cooperative associations, or
an association for about every 2,150 persons. In 1939 these cooper
atives were serving about 3% million families, or about 40 percent of
the population. In 1930 cooperative exports constituted 3.2 percent
of all exports from Poland and ranged from 1 percent for eggs and
pigs to 20 percent for corn and 64 percent for butter.
T ypes o f Associations
The 13,004 associations in existence at the end of 1936 were grouped,
by type, as follows:
N u m ber
associa
tio n s
Consumers’ cooperatives__________________________________ 1, 552
Agricultural consumers’ cooperatives________________________2, 659
Agricultural marketing cooperatives_______________________
392
Cooperative dairies_______________________________________ 1, 323
Health cooperatives______________________________________
8
Credit cooperatives____________________ __________________ 1
School-children’s cooperatives_____________________________ 17 07(*
Housing associations___________ - _________________________ f u/ u
Other____________________________________________ J
18 In rural areas, the priests were often presidents of associations, and lectures on the organization of co
operatives were given in the Catholic seminaries.
588544°— 44----- 15
218
Cooperatives in Individual Countries
All but about 1,500 associations were affiliated to the auditing
unions. The accompanying table shows the number and type of
associations affiliated to each of the auditing unions in the latest year
for which data are available (1937 in most cases).
T
able
6 8 . — Mem bership and Business o f Polish Auditing Unions
1
[F or par values of cu rrency, see A p p e n d ix table, p. 278]
A ffiliated asso
ciation s
A m o u n t o f business
of—
Central organization and ty p e o f affiliate
N um
M em ber
M cm oers
ber
associations
Z lo ty s
Union of Distributive Cooperative Associations...........................
Union of Agricultural and Provident Cooperatives........................
Rural credit associations.............................................................
Urban credit associations.............................................................
Trading associations........... . . .............. ......................................
Auditing Union of Ukrainian Associations.....................................
Rural credit associations.............................................................
Urban credit associations.............................................................
Trading associations.....................................................................
Auditing Union of Ruthenian Associations....................................
Rural and urban credit associations........................................ .
Trading associations........................ ............................................
Union of German Cooperatives in Poland......................................
Rural credit associations..............................................................
Urban credit associations.............................................................
Trading associations.....................................................................
Union of German Agricultural Cooperatives in Poland.............
Union of German Agricultural Cooperatives in Pomerania........
Rural credit associations................................................. ...........
Trading associations...................................................................
Auditing Union of Army Cooperatives..........................................
Union of Cooperative Societies and Employees’ Associations...
Union of Jewish Cooperative Societies........... .......... .......................
Union of Jewish Tradesmen’s Cooperatives...................................
F edera
tio n
Z lo t y s
332,555
21,535
150,918,000 9 0 ,6 0 7 ,0 0 0
5.503 1,655,292 a 191.000,000
2 ,756
711,711
(i*4)
639
375,663
(4)
2.108
567,918
(4)
645,595
3,326
139,431,000 3 3 ,092,000
80,052
543
(4)
124
78,058
(4)
2,659
477,150
(4)
218
30.553
2,6 5 5 ,0 0 0
67
21, 293
(4)
9 .260
151
(4)
585
45,133
69,978,000 4 0 .160,000
268
14,726
(*)
78
15,443
(4)
239
14.964
( 4)
97
7 ,466
1,099,000
202 ,0 0 0
176
12,566
(4)
63
6,398
( 4)
113
6,168
34,151,000
24,067
231
20,350,000
121, 245
525
(4)
638
«135,717
(4)
120
20,706
(4)
i E xcep t w here otherw ise noted, data are for 1937.
* G rouped into 6 federations.
»1938.
4 N o data.
The membership of the unaffiliated associations is shown, by type
of association, in the following statement:
A s s o c ia
tio n s
M em bers
All types—..................................... - ............................................... 1,514
154,000
Consumers’ cooperatives___________________________________
Agricultural consumers’ associations________________________
Dairies____________________________________________________
Credit associations___ _____________________________________
Housing associations_______________________________________
Other types—_________________ 1___________________________
20, 000
24, 000
17,000
73, 000
5, 000
15, 000'
238
315
155
440
106
260
Consumers’ Cooperatives
Consumers' cooperation in Poland dates from 1869, but it spread
very slowly and by the beginning of the twentieth century only 50
associations had been formed. The revolution of 1905, which won
from the Kussian Government a substantial degree of freedom for
the people, gave impetus to the cooperative movement and by 1908
there were 670 consumers' associations.
In 1911 a cooperative wholesale association was formed, which by
1913 had in affiliation 297 member societies with 39,000 members.
219
Poland
In addition, and without connection with the union, there was a group
of Catholic associations with their own central organization; a num
ber of independent associations; and in Austrian and German Poland
(Galicia, Silesia, and Upper Silesia) some associations either inde
pendent or having their own unions. Altogether, before the first
World War, there were on Polish territory about 1,300 consumers'
cooperative associations with 122,000 members and annual sales of
20,000,000 rubles.
During the war the impossibility of maintaining continuous contact
between the wholesale and its affiliates resulted in the formation of
nine regional wholesales which in practice enjoyed complete autonomy.
The advantages offered by the cooperative movement as a medium
of provisioning the people in wartime resulted in considerable ex
pansion of the movement, and the union at Warsaw emerged from
the war period with 327 affiliates (with a total of 57,000 members).
The union was operated on strictly Rochdale principles and observed
political neutrality. A Socialist movement had, however, grown up,
having its own central body, called the Workers' Union of Coopera
tive Societies; the Central Society of Christian Cooperatives (Catho
lic) resumed its activities; and there was also a powerful group of
associations of Government employees, as well as one of soldiers' or
military cooperatives. Altogether there were some 2,200 associations
with 200,000 members.
One of the first acts of the new Polish Republic was the passage of
a liberal cooperative law. Under it the movement grew rapidly, but
to a large extent upon a political or professional basis. Much of this
growth disappeared when the period of deflation of currency began,
and only the stronger and more stable enterprises were able to sur
vive. One after the other the groups of Government employees'
organizations, the Socialist cooperatives, and the Catholic associations
joined the original union at Warsaw, renamed “ Spolem,'' Union of
Distributive Cooperatives of the Polish Republic.
By the late twenties the cooperatives had recovered from the pros
tration of the deflation period and reached a peak of prosperity in
1928-29. This was short-lived, however, for the long depression set
in shortly afterwards and the cooperatives suffered, along with private
business.
Beginning with 1933 (which was the turning point in the depression
in Poland) cooperation once more began to thrive and both the con
sumers' and agricultural branches of the movement made rapid prog
ress. In 1933 it vras estimated that the consumers' cooperatives were
doing about 3 percent of the general retail trade of the country and
about 10 percent of the trade in food. In other commodities the
percentages were as follows: Sugar, 5.4 percent; tea, 5.7 percent;
rice, 8.4 percent; and salt, 9.6 percent.
Until 1935, industrial wage earners formed the largest group in
Spolem. In that year the peasant members exceeded them numeri
cally and for several years thereafter increased their lead. In 1937
the membership was distributed occupationally as follows:
Percent o f total
Peasants__________________________________________
Industrial wage earners____________________________
Clerical workers___________________________________
Others_______________________________
44
31
10
15
220
Cooperatives in Individual Countries
By 1935 Spolem had become the largest commercial organization
in Poland. In 1939 it had in membership 1,776 associations (grouped
into 6 federations), with 412,762 members. The wholesaled business
in that year reached the sum of 98,000,000 zlotys. Under a syste
matic policy Spolem expanded its productive departments, but never
attained the development achieved by the wholesales in certain other
European countries. In 1937 goods made in its own factories ac
counted for about 10 percent of its total turnover (see table 8, p. 29).
Health cooperatives.— Poland had a cooperative research organiza
tion, the Scientific Institute for Cooperation, established in 1919.
Until 1930, this Institute devoted its attention to agricultural coopera
tion. In that year its field was broadened and it began to admit to
membership all types of cooperatives.
In 1935 the Institute began to explore the possibilities of cooperation
in the field of medical care, and started to carry on educational work
with the idea of organizing associations in this field of activity. The
first health association was established in September 1936 in the town
of Markowa, with a group of 150 member families. Six months later
its membership had increased to 260 families and it was providing
medical service in 7 surrounding villages with about 12,000inhabitants.
By 1938 there were 8 cooperative health associations in Poland, some
of which had been started by the Auditing Union of Ukrainian Coop
eratives and some#by the Polish Union of Agricultural Cooperatives.
Each of the associations operated throughout a territory of 6 to 10
villages.
Each of the associations had its own dispensary, a full-time physician,
and sometimes a midwife. Some associations also arranged for the
services of a dentist, once a week. Additional activities of the
physicians included advice on infant welfare; investigation of
housing conditions; advice on personal, family, and social hygiene;
and organization of preventive health measures.
Under Polish law cooperative associations were not allowed to
operate drugstores, but in some cases the associations had contract
arrangements with local druggistsby which members received discounts.
Housing.— In 1934, according to the Scientific Institute for Coop
eration of Warsaw, there were in Poland about 1,080 housing associa
tions. They had erected buildings containing some 75,000 rooms, at
a cost of 360,000,000 zlotys. One of the important local associations
was the Cooperative Housing Society in Warsaw, started in 1921.
This was an association which operated on a genuinely Rochdale
basis, retaining collective ownership of all the properties. Its mem
bers, exceeding 4,000 in number, were almost entirely of the wageearner and low-salaried class. Up to 1936 the association had built
24 apartment houses, with accommodations for 1,713 families. Resi
dents in the cooperative buildings had their own credit association,
dispensary, library, motion-picture theater, laundry, a nursery school,
a primary school and a secondary school, athletic field, and even a
small zoological and botanical garden for the use of the schools. All
of these were operated cooperatively.
Student cooperatives.— One feature of the consum ed cooperative
movement in Poland was the cooperative associations of students in
the elementary schools, the formation of which was encouraged by
the Polish Ministry of Education.
Poland
221
Effects o f the W ar
The outbreak of war occurred in a period of rapid cooperative
development, when many new associations were being formed, co
operative trade was expanding, and new productive facilities were
being acquired.
It is reported that after the invasion of the country in September
1939, “ notwithstanding the cruelty of the war and the terrible destruc
tion of the country, the majority of the directors of the cooperative
organizations remained at their posts.”
In the subsequent cession of territory to Germany, Lithuania, and
the Soviet Union, the cooperatives which had headquarters in Warsaw,
but had member associations throughout Poland, lost the greater part
of their members and resumed their activities only with the greatest
difficulty. In the Soviet-occupied territory the urban associations
were dissolved (as they had also been elsewhere in the Soviet Union
in 1935), but a certain amount of freedom was left to the agricultural
cooperatives.
In Vilno, ceded to Lithuania, the Polish cooperatives were “ forced
to liquidate in favor of Lithuanian organizations.” Cooperatives
may be said to have ceased to exist in the western Provinces that
were incorporated into the Reich; in the other German-occupied
Provinces (including Cracow and Warsaw) a certain measure of
autonomy was allowed and there the cooperatives continued to oper
ate, under the close supervision of the occupation authorities. Re
ports received by the International Cooperative Alliance indicate that,
nearly 2 years after the invasion of Poland, cooperatives and their
federations were still operating in German-occupied Poland. In fact,
they were accorded a favored position in respect to obtaining supplies,
being allowed to make purchases in Germany and being given the
necessary transport facilities. According to the International Co
operative Alliance, “ this surprising appearance of friendliness” toward
the cooperative movement, which had always been associated with
the Polish struggle for independence, was explained by two factors—
the determination of the occupation authorities to destroy the liveli
hood of the Jews (who were largely engaged in private trade) and the
Germans’ desire to use the cooperatives as machinery for collection
and distribution of foodstuffs. The rich western agricultural regions
had been incorporated into the Reich; the less-fertile remainder of the
territory had not only to supply its own inhabitants (some 15 million)
and also about lK million Poles who had been expelled from the western
Provinces, but was compelled to hand over a considerable part of
its crops to the occupation authorities. The agricultural cooperatives
were forced to act as the collection agencies for these requisitioned
supplies, and the cooperative stores were allowed to sell goods to the
farmers only in exchange for specific amounts of farm produce at
prices set by the Germans.
The urban associations were used as distributors of supplies to the
city dwellers. Regarding this situation the International Coopera
tive Alliance commented as follows:
The small supplies left in the country are distributed through the cooperatives,
which are thus made the instrument through which the rations— which are very
often below the subsistence level— reach the population of Warsaw and the larger
towns, and through which much higher rations are supplied to the German settlers.
222
Cooperatives in Individual Countries
It must, be a bitter experience for the Polish cooperators to see their organizations,
which for almost two generations played such an important part in preserving
Polish nationhood against the Prussian policy of assimilation and annihilation,
used as a channel for robbing and starving their own people and feeding theNazi
invader.
In some places where cooperative associations were few in number,
the Germans even fostered the development of new cooperatives.
Thus, in the town of Baranowicz, in eastern Poland near the Soviet
border, a Ruthenian school teacher named Potapovycz was persuaded
to organize a cooperative network for the whole city; by 1942 there
were in operation 21 cooperative stores, 5 meat markets, 3 bakeries,
and 2 restaurants, and additional associations were being started in
the surrounding villages. Possibly as a result of such encouragement,
about 300 new associations had been formed throughout Poland and
some 140 had joined Spolem, so that that organization was stronger
than before.
Evidently the workers’ productive associations were also being used
by the Germans. A Central Office for Handicraft Deliveries had been
started, which distributed orders to the associations “ in the interest
of the German war effort” and received the finished goods. Of 154
housing associations in Warsaw, 36 had been liquidated by the end
of 1942 and the rest had been merged into 6 new associations. Of
course none of the cooperative organizations was really free after the
invaders arrived.14
Cooperative Movement in the Soviet Union
In the period preceding and during the first World War, the Russian
cooperative movement showed the most phenomenal growth in all
Europe. Since the overthrow of the Czarist regime and the establish
ment of the Soviet Union, its fate has depended upon the policies of
the Government, which have ranged all the way from grant of monop
oly to suppression. In 1935 the urban associations were absorbed
into the system of State stores, and since then consumed cooperation
has been found only in rural districts where they are the predominant
factor in retail trade. Both the workers’ productive associations
(“ artels” ) and the agricultural cooperatives have been encouraged by
the Government, but the latter exist now mainly in connection with
the Kolkhozes (collective farms).
Cooperatives Through W orld W ar I
Cooperatives in primitive form have existed in Russia as far back as
the records go, the early forms being based largely on the “ artels” — or
group activities for the carrying out of a definite enterprise, such as the
cutting of wood, processing of milk, fishing, etc. This natural bent of the
people received impetus when the serfs were freed in 1863. As there
was little or no private commercial enterprise, artels sprang up in a
clear field, and other types of enterprises followed.
h Sources .—The report on Poland is based upon data from the following publications: Directory of Co
operative Organizations, (International Labor Office, 1939), Cooperative Information, issues No. 11, 1930,
No. 12, 1937, Nos. 8 and 11, 1938, and International Labor Review, April 1921; Revue des Etudes Coopera
tives (Paris), January-March 1929; Review of International Cooperation (International Cooperative Alli
ance, London), March and April 1932, October 1935, November 1936, January and July 1939, and February
and May 1941; People’s Yearbooks (English and Scottish Cooperative Wholesale Societies), 1930 to 1941;
and the Task of Cooperatives in Post-War Relief and Reconstruction, by Halbert, Shoskes, and Tereshtenko (Washington, 1943).
223
Soviet Union
Although the first consumers’ cooperative association with written
bylaws was organized only in 1865, by 1874 there were 353 such asso
ciations, and by 1914 over 11,000.
The local consumers’ associations were federated into regional unions
and the latter in turn into the all-Russian Central Union of Consumers’
Cooperatives (known as “ Centrosoyus” ). In 1918 some 40,000 of the
50,000 local associations then in existence were, through their regional
federations, members of Centrosoyus. Even at that early date Cen
trosoyus had entered into production and was operating flour mills,
refrigeration plants, fisheries, and factories making candy, shoes, soap,
syrup, tobacco, chemicals, and matches.
The workers’ productive associations or artels included shoemakers,
potters, toy makers, and other craftsmen, and were federated into a
national body, called the Kustar Union. These organizations were
assisted in their financing by the credit cooperatives.
T ypes o f Associations
The Russian cooperatives have always been of two or three standard
types. In 1920 a Russian cooperative leader classified them as con
sumers’ , credit, insurance, and productive (including both agricultural
producers’ and workers’ productive) associations. Since 1920, when
the “ consumers’ communes” by official decree absorbed the other
types of associations, no mention has been made of credit or insurance
cooperatives.
T
able
69.— M em bership and Operations o f Cooperatives in the Soviet Union in 19379 by
T yp e o f Association
[For par values of currency, see Appendix table, p. 273]
Type of association
Number
Membership
Amount of
business
L o c a l a ssociations
R u b le s
Consumers' associations........................................................
Occupational associations...................... ................................
Affiliated with central federations:
Artels........................................................................
Disabled men’s associations....................................
Forestry associations.................................................
Fishermen's associations........ .................................
Other......................... ...................................................... .
Agricultural................................................... ..........................
Kolkhozes (collective farm associations).................... .
Other...................................................................................
C en tra l fed era tion s
Centrosoyus (consumers’) .............. .......................................
Federation of disabled men’s associations..........................
24,113
15,577
39,200,000
2,402.971
28,141,100,000
5,411,743,000
2,228
2,327
3,905
1,022
6.095
246,905
243,000
3,905
1,642,073
240,277
370, 621
150,000
12,727,000
3,460.300,000
1,635,416,000
303.300,000
0)
19,156,921
18, 786,300
370, 621
0)
8
(9
M e m b e r a sso
ciation s
24,113
2,327
39.200,000
240,277
2,300,200,000
1,728,000,000
1No data.
Agricultural cooperatives.— Most of the agricultural cooperative
activities, as the table indicates, are carried on by the Kolkhozes.
These communities have their processing and marketing associations,
all operating within the Party framework. The Kolkhozes and their
associations are stated to occupy “ the foremost place in the agricul
ture of the U. S. S. R., as 93 percent of the peasant families belong
to them or are employed by them.”
224
Cooperatives in Individual Countries
Workers' productive associations.— “ Kustar” or cottage industries
have always been a characteristic of Russian life. Whole villages
engaged in the production of commodities of one kind or another,
sometimes specializing in a single type of work. Such factories as
existed were small.
Sometimes the work was done on a cooperative basis, either in a
workshop owned by the cooperative or with the association acting
merely as marketing agent. Such cooperatives were known as “ ar
tels.” The lack of large-scale manufacturing enterprises in the coun
try enabled these associations to hold their own, and even as late as
1930 a survey by the Planning Commissariat indicated that 60 per
cent of the industrial workers in the Soviet Union were employed in
small industries and that about 25 percent of them belonged to artels.
Their main field was that of unskilled labor, temporary and seasonal
labor, production on a small scale, and handicrafts. Under the vari
ous 5-year plans, the artels have been encouraged to make the fullest
possible use of local materials and, in total, have played a substantial
part in industrial production. In the 5-year period from 1932 to
1937 the value of their output rose from 5,763,500,000 rubles to
13.178.000. 000 rubles. The value of consumer goods produced by
them amounted to 10,000,000,000 rubles in 1937 and in 1938 to nearly
12.000.
000.000 rubles. In 1938, about 20 percent of Russia's con
sumption goods was produced by these industrial cooperatives. They
produced about 35 percent of the furniture, 35 percent of the felt
footwear, 42 percent of the metal goods, 65 percent of the metal beds,
33 percent of the piece goods, 15 percent of underwear, and 80 percent
of the notions in the Soviet Union. Such goods as artistic rugs,
embroideries, scissors, kerosene burners, utensils, toys, and musical
instruments were produced entirely by the artels.
Cooperation Under the Soviet Government
Since the advent of Bolshevism, late in the first World War period,
the consumers' cooperative movement of Russia has undergone many
changes of status. The first attitude of the Communists, after the
revolution, was to regard cooperatives as remnants of a bourgeois
society, which had no place in a system in which all private ownership
was abolished and everything belonged to the people through the
commonwealth. The general economic collapse of Russia, however,
prevented the new government from organizing a new system of dis
tribution and it was compelled to utilize the existing forms. Among
these the cooperatives were of considerable strength. During this
period a change took place in the official attitude, and by a decree of
March 20, 1919, the associations were deprived of their autonomy
but were given the status of government organizations. Every consinner was required to become a member of a consumers' cooperative.
A decree of January 27, 1920, amalgamated all other cooperative
organizations with the “ consumers' communes” and their central or
ganizations were also incorporated into Centrosoyus, formed in 1917
from an older federation that had been in existence since 1898.
The comparative lack of success of this measure led to a relaxation
of restrictions under the New Economic Policy and on M ay 20, 1924,
an order was issued nominally restoring the voluntary membership,
Soviet Union
225
membership capital, and formulation of policy—all, however, under
the final control of the Communist Party.
Somewhat earlier (in 1922) the Government had started a number
of retail and wholesale associations connected with State industries
and this system was expanded during the next few years. As the
process of industrialization of Russia was intensified, a greater degree
of compulsion was exercised in all lines of activity— cooperative as
as well as others. An official of the International Cooperative
Alliance described this as follows:
Nominally cooperative enterprise was developed on a large scale in retail dis
tribution, wholesaling, and agricultural marketing. New organizations were
set up and the turnover of the old ones greatly increased. But these cooperative
organizations have actually developed on the same lines as State trading organ
izations. The share capital of their members, where it existed, lost any direct
relation with the actual size of the transactions of the societies, whose working
capital was being procured from State financial sources. The town consumers'
societies slowly developed into stores managed from one center without consult
ing the members. The consumers' societies were, during that period, made
practically the monopolistic distributors of rationed goods, and their members
and customers consisted actually of the whole local population which were en
titled to rationed supplies. In their internal organization and management the
consumers' societies became indistinguishable from State stores, but the actual
distinction between them was that the former had a monopoly for rationed sup
plies and the latter a monopoly for nonrationed supplies.
This process continued under the second 5-year plan, but with the
introduction of uniform prices the cooperatives lost their monopoly.
In 1932 and 1933, the so-called “ closed cooperatives” attached to
factories were turned over, by Government decree, to operation by
the factories. Later the Communist Party and Government decided
to abolish the urban associations, which at that time were handling
about 30 percent of the urban retail trade. The question was not
referred to the membership for decision. These societies were
wiped out at one stroke when, on September 29, 1935, a decree was
issued stating the decision of the Council of People's Commissars and
the Central Committee of the Communist Party that the organiza
tions of consumers' cooperatives in towns be liquidated and all their
property transferred to the People's Commissariat of Internal Trade.
This action was explained as being necessary because the cooperatives,
it was said, were not capable of supplying the market and because the
unnecessary expenditure and extra staff involved in having two types
of distribution (State stores and cooperatives) could not be justified.
This measure reduced the number of consumers' cooperatives in
the Soviet Union from over 100,000 to about 25,000 and the member
ship from over 70,000,000 to fewer than 40,000,000 persons. The
village cooperatives continued to operate, and in 1938, according to
the chairman of Centrosoyus (who was also vice chairman of the Pre
sidium of the Supreme Soviet of the U. S. S. R.), were running not
only grocery stores (an average of 7 each) but also some 53,000 whole
sale warehouses, nearly 20,000 bakeries, and over 6,800 eating places
(lunch counters, restaurants, etc.). They also carried on a wide
range of welfare and cultural activities.
Although the cooperative associations in the Soviet Union, like all
other enterprises that are allowed to operate there, are under the final
control of the State, a Soviet official stated that they elect their own
officials and in all ordinary matters the members operate the business.
A report to the International Cooperative Alliance stated that as
226
Cooperatives in Individual Countries
far as the primary (local) associations are concerned, there are gener
ally only one or two Communist Party members in each association.
Their function, it was said, was to act as “ guardian of cooperative
democracy in the consumers’ movement” as well as “ responsible
agents of the Party and the Government entrusted with the task of
satisfying the essential needs of the people.”
The International Cooperative Alliance appears to have been con
vinced of the essential democracy and freedom within the coopera
tives themselves, for Centrosoyus is still a member of the I. C. A.
The development of the consumers’ cooperatives in the Soviet
Union from 1914 to 1939 is shown in table 70.
T
able
70.— M em bership and Business o f Consumers9 Cooperatives in the Soviet Union ,
1 9 1 4 -3 9
(For par values of currency, see Appendix table, p. 278]
Local associations
Year
Centrosoyus:
Business
Number
Members
1914...............................................................
1917...............................................................
1919...............................................................
1923...............................................................
1924...............................................................
1927...............................................................
1930...............................................................
1932...............................................................
1933...............................................................
1934...............................................................
1935 ».............................................................
1939...............................................................
11,400
35,000
53,000
*26,006
25,974
0)
(0
45,764
(0
103,000
25,252
26,500
Business
Gold rubles
1,650,000
11,550,000
18,500,000
<9
8,722,000
15,075,000
37,806,000
71,953,000
69,000,000
70,700,000
39,400,000
40,000,000
290,000,000
1,243,617,021
(?)
Gold rubles
10,263,544
46,791,000
44,179,000
0)
215,649,000
1,040,748,000
10,070,531,000
127,500,000
662,500,000
<9,909, 400,000
16,418,000,000
19,605,600,000
20,796,200,000
7,604,000,000
14,154,400,000
14,910,000,000
0)
42,000,000,000
(0
0)
(0
i No data.
* No data; this was the year of civil war.
* Reduction in number from 1919 was the result of the reorganization and consolidation that took place
under thed ecree of March 20,1919.
* Data do not include restaurant business.
* From this year onward, data relate only to rural cooperatives, as the urban associations had been ab
sorbed into the system of State stores.
Cooperatives in W orld W ar I I
Only scattered data are available regarding cooperatives in the
Soviet Union since the beginning of the present war, but it appears
that the services of the workers’ productive associations, as well as
of the village consumers’ cooperatives, have been utilized to an in
creasing extent.
Early in 1943 it was announced that the labor unions had been made
responsible for supervision of the “ trading network” (presumably
including the village cooperatives), to insure correct weights, good
quality, cleanliness, etc.
What, if any, effect the announcement of autonomy for the various
republics that compose the Soviet Union has had or will have upon the
status of the cooperative movement is not known.
Situation in western Ukraine.— When the western Ukraine was in
corporated into the Soviet Union, after the partition of Poland in
September and October 1939, the 5,000 cooperative organizations
there were transformed along the same lines as the Russian associations.
All associations (previously organized mainly along nationality lines—
Ukrainian, Polish, Russian, Jewish, and German) were merged into a
Soviet Union
227
single association for the whole of western Ukraine and this organiza
tion was made subordinate to the federation at Kiev. It was stated
that “ the Soviet influence was strengthened by the appointment of
men bred and trained in the Soviet cooperative movement to leading
positions in western Ukraine, including those of directors and managers
of societies, chief accountants, managers of financial and planning
departments, and experts of all kinds.” 15
The greater part of the industry in this region consisted of small
family enterprises, sometimes with one or two outside helpers. A
considerable number of these were organized into about 250 new
cooperatives (artels). Some 230 small factories taken from private
owners and nationalized by the Soviet Government were handed over
to these new cooperatives, together with a special loan of 20 million
rubles for expansion and mechanized equipment. It was expected
that these productive enterprises would produce various consumption
goods (foodstuffs, metal articles, leather goods, footwear, textiles,
etc.) in the next year. These goods were to be disposed of, partially at
least, to the State retail and wholesale organizations (formerly private
enterprises, taken over by the Soviet Government).16
Countries o f Southern Europe
Of the countries of southern Europe— Italy, Portugal, and Spain—
only Italy can be said to have attained any considerable degree of
cooperative development. Even in that country, religious and
political divisions and the too great individualism of the associations
prevented the movement from attaining its potential power. Co
operative wholesaling was a failure, because of the lack of loyalty
of the local associations, until a decree by the Fascists made member
ship and patronage of a central wholesaling organization compulsory.
Similar divisions were characteristic of the movement in Spain. With
the exception of Albania, Portugal was the least developed cooperative
ly of all the countries of Europe.
Spain and Italy each excelled in a special type of association:
Spain, in the P6s‘tos Maritimos— fishermen’s general-purpose associa
tions combining thrift and loan activities with joint purchase of oc
cupational and household supplies, educational work, and marketing
of the catch; Italy, in the workers’ productive and labor associations
which undertook contracts for all kinds of projects (including bridge,
road, railroad, and other construction, printing, farming, and many
others).
As Italy was the first European country to adopt a totalitarian
form of Government, many years have passed since its cooperatives
have been free. In all three countries the movement has been ab
sorbed into the corporative machinery, but still exists under Govern
ment control.
16 Review of International Cooperation (London), February 1940 (p. 61).
i« Sources— T a e report on the Soviet Union is based on data from the following: Planovoe Khoziaistvo
(Gosvzdat, Moscow), Nos. 2 and 12,1938; U. S. S. R. Handbook (London, Camelot Press), 1936; Bulletin
of All-Russian Central Union of Consumers’ Societies, Centrosoyus (London), Nos. 1-14; Kooperativnaia
Shizn’, Vsia Kooperatsia U. S. S. R. (Moscow), 1920; Russian Cooperative Movement, by A. J. Zelenko
(in Monthly Labor Review, June 1930); Review of International Cooperation (International Cooperative
Alliance, London), March 1936, May and June 1939, February 1942, and March 1943; People’s Yearbooks
(Cooperative Wholesale Society, Manchester, England), 1926, 1929, 1936, 1936, 1937, 1941, and 1943; Inter
national Directory of Cooperative Organizations (International Labor Office), 1939; Cooperative Informa
tion (International Labor Office), Nos. 7 and 10, 1937, No. 2, 1940, and No. 1, 1943; Annals of Collective
Economy (Geneva), May-December 1937; and Russian Economic Notes (U. S. Bureau of Foreign and
Domestic Commerce), August 30, 1939.
228
Cooperatives in Individual Countries
Cooperative Movement in Italy
The cooperative movement in Italy dates back to about 1854 when
the first cooperative store in that country was organized at Turin,
to mitigate the effects of a famine. In the half century between the
unification of Italy and the rise of Fascism, all of the branches of
cooperation showed some degree of development. The outstanding
characteristics of the Italian movement were the great variety of
types, the multiplicity of small, rather weak associations, religious
and political division, and consequent rivalry and lack of even
friendly relations among the factions.
Though a National League of Cooperative Associations (Lega
Nazionale delle Cooperative) was founded in 1886, it never held the
allegiance of the whole movement. A cooperative wholesale, estab
lished in 1905 and reestablished in 1911, never was able to win support
of rival groups. Religious, political, and economic differences in
tensified toward the end of the first World War. The Christian
Socialists withdrew to form their own consumer federation in 1917.
In 1920 the National League, apparently believing that its fate
depended upon the Socialists in Parliament, abandoned the tradi
tional cooperative political neutrality. By 1921, when Fascism was
well under way and even had its own cooperatives with a national
federation, the number of cooperative associations in Italy was re
ported as 19,510.
During the early period of Fascism, consumers’ cooperatives suffered
from vandalism, the terrorism employed by the Black Shirts, and the
loss not only of goods but of plant. Many associations disappeared
entirely during this time. From 1921 to 1922 the total number of
Italian cooperatives fell from 19,510 to 8,000 (the distributive asso
ciations from 6,481 to 3,600).
The headquarters of the National League in Milan was taken over
by the State in 1925 and late the following year an act consolidated the
Government’s power over the cooperatives. In 1931 the cooperatives
were required to join the Fascist federation. They continued, how
ever, not only to be tolerated— under strict Party control, of course,
and provided that, as the People’s Yearbook pointed out, “ all political
opinions (other than Fascist) have been banished” —but even enjoyed
some degree of official favor, and continued to operate as Fascist
organizations. In 1937, the latest year for which statistics are avail
able, Italian cooperatives numbered 12,076, of which consumers’ dis
tributive associations accounted for 3,500.
T ypes o f Associations and Their Activities
The cooperative movement of Italy was one of the most varied in
type, with specialized associations confining their operations to a
limited field. The development of the various branches of the move
ment, as shown by number of associations, is indicated in table 71.
229
Italy
T able 71.— Num ber and T yp e o f Cooperative Associations in Italy , in Specified Years,
191 0 -3 4
Number of associations
1910
Type of association
Asso Mem
cia
tions bership
1914
1915
1917
1921
1922 19271 19321
1934
All types...............................................
5,064 795,206 7,429 8,251 8,764 19,510 8,000 8,391 11,062 11,771
Consumers’ cooperatives____ ______
Productive and labor associations:
Transport__ _____ ______ ____
Workers’ productive.....................
Labor
Fishermen’s associations.....................
Bakeries, slaughteries, and other
associations producing consumers’
goods
Agricultural (wine, etc.) associations.
Insurance associations.....................
Housing associations____ __________
Ex-soldiers’ associations _____ _
Other types_____ ____________ _____
1,764 223,192 2,255 2,312 2,499 6,481 3,600 3,334 3,240 3,860
564
1,017
31
244
305
918 1,666 7,643 *2,700 *1,283 1,630 1,817
831
70,719
399
94,738 1,758 2,175 2,257
75
122
136
94
2,871
(3)
167
139
87 16,058
125
700
926 161,115 1,242 1,371 1,386
133
162
165
124 108,000
151
709 *1,534
704
379
677
/
2,239
348
445 1,480 1,000
172 |*118,513 \ 296
314
(3)
499
810 3,598
553
218
696 1,239
1Totals include some associations the type of which was not shown.
* Including some labor associations.
* No data.
* Including some credit associations.
^Includes an unspecified number of mutual-aid and transport associations.
PH ARM ACEU TICAL COOPERATIVES
Three main groups of pharmaceutical cooperatives had developed
in Italy by 1930: Specialized cooperatives established to run drug
stores such as those in Milan, Bergamo, Mantua, Brescia, Parma;
enterprises which were branches of distributive cooperatives, such as
the 7 cooperative drug stores of the Turin Cooperative Alliance; and
cooperatives of druggists themselves.
The first pharmaceutical cooperative was founded in Milan in 1890
and within a few months had 694 members and capital amounting to
about 80,000 lire.1 By 1910 cooperative drug stores had the largest
membership of any type of cooperative carrying on production in
Italy—38 associations reporting 19,242 members. In 1930 the Milan
Pharmaceutical Cooperative owned 13 of the largest drug stores in
Milan; in addition it had a pharmaceutical laboratory which held
several patents and produced much of the medicine the cooperative
stores sold. The Milan association’s drug business amounted to
approximately 9,000,000 lire; patronage refunds to members averaged
about 5 percent on purchases and the association’s prices influenced
pharmaceutical prices throughout the whole city. In addition to its
retail and productive activities, the pharmaceutical cooperative
published the “ Medicamenta” (a guide for doctors), and periodicals
for practical use.
COOPERATIVE CREDIT
In 1866, Luigi Luzzati, later Minister of Finance (later still, Prime
Minister) of Italy, introduced in Milan the first people’s bank— a
cooperative credit association of the Schulze-Delitzsch type. A
National Association of Italian People’s Banks appeared in 1874.
After the Raiffeisen type of association developed, the credit move
1 F o r par values of currency, see Appendix table, p. 278.
230
Cooperatives in Individual Countries
ment continued in these two main channels. By 1911 there were 1,872
credit cooperatives in Italy— 1,117 in the North (where the people's
banks predominated), 218 in Central Italy, 164 in the South, and 313
in Sicily, and 60 in Sardinia.
Preparations for a central credit institution were completed in 1913
and the National Institute for Cooperative Credit (Instituto nazionale
di credito per la cooperazione) began operations in 1914. It was
stated at the time that the Government planned to use the Institute
for the collection of taxes and the payment of pensions. Policies
such as the latter and also the granting of credit for purposes other
than cooperative account partially for the fact that the credit organi
zations have not usually been considered a part of the true cooperative
movement in Italy, and statistics are not available for them.
After 1920, when post-war reconstruction greatly enlarged the
undertakings of the workers' cooperatives, the Institute opened two
new independent sections, one dealing with the land and agricultural
cooperatives and the other with the building cooperatives. Locally,
cooperative credit was handled by cooperative banks such as those
in Milan and Genoa, which did an annual business of 170,000,000
lire and 54,329,000 lire respectively.
Under the Fascists, the credit cooperatives were maintained on their
former legal basis, with some additional regulation. Some of the
former regional federations continued, but all credit organizations
became members of two national associations, one (Casse Rurali) for
the Raiffeisen type of cooperative with unlimited liability and the
other (Banche Popolari) for the Schulze-Delitzsch type with limited
liability. Though both systems were reported to be succeeding,
examination of the official records of their business indicates that
deposits declined throughout the decade until 1936.
w orkers’
p r o d u c t iv e
and
labor
c o o p e r a t iv e s
Workers' productive cooperatives achieved remarkable success in
Italy. Two different forms developed: The workers' productive
association in which the group of workers owned and managed a plant
such as a printing or small-scale engineering establishment; and the
labor cooperative or labor-contracting cooperative {cooperative dei
braccianti) . The latter consisted of a group of workingmen organized
to find their own employment by obtaining and fulfilling contracts
for work, such as the construction of roads, buildings, ships, the drain
ing of marshes, or the loading of boats. These organizations developed
early in the Po River valley. Legislation of 1889 permitted contracts
with the State up to the value of 20,000 lire. Later all limitations
were removed, and contracts could be made by private agreement
without open bidding or the customary guaranty deposit. By 1910
the workers' cooperatives consisted of 774 associations of which the
main groups were those of builders, bricklayers, artisans, and long
shoremen, with a total membershhip of 100,000. Regional federations
were recognized by national law in 1911. A national federation which
planned to give technical advice, make contracts, and assign them to
the proper local federation was formed in 1919 and affiliated to the
National League.
By 1914 the Ministry of Public Works was giving 15 percent of its
contracts to labor cooperatives. In Ravenna and Ferrara 85 and 90
Ita ly
231
percent respectively of all public works were constructed by coopera
tives. After World War I the Government continued its reliance on
labor cooperatives, and their federation participated in the disposal
of war materials. When the Government advanced 1,500,000,000
lire to ease post-war unemployment, the labor cooperatives received
most of the money for works of reconstruction.
In the early 1920’s all of Italy showed the effects of the work of
workers’ cooperatives— at Milan, the well-known printing works and
many fine houses; at Venice, excellent mosaic work and wood carving;
at Genoa, the Piazza Tommaseo, bridges, ships, etc. ; at Ravenna and
Ferrara, a large proportion of all public works; at Bologna, a large
bridge; at Rome, a vast drainage system and a suburban development;
in Emilia and Sicily, large farms cooperatively run; elsewhere, rail
roads (the Reggio Emilia, the Reggio Ciano built and managed by a
labor cooperative), roads, harbors, and docks.
A great variety of occupational groups was represented in the
membership of the Milan Federation of Productive and Labor Coopera
tive Associations— iron- and marble-workers, plasterers, paperhangers,
gilders and varnishers, goldbeaters, shoemakers, glove dyers, tauors,
printers, bookbinders, porters, the Milan builders (the largest group
of all), and others. In the field of agriculture, Italian workers’
cooperatives not only carried on draining, building, and the customary
crop-producing activities but also leased and cultivated farm lands
collectively. The acreage cultivated immediately before the Fascists
came into power was reported to be 55,032 hectares.2 Much the
greatest acreage cultivated in any one Province was that of Emilia—
25,603 hectares. The Ravenna Federation, which was reported to
represent one-fifth of Italian cooperative agriculture, managed 15
farms and held 13,041 acres on collective lease.
Serious division among the workers’ cooperatives appeared after
World War I. In 1920, the Catholic, or Christian Socialist, coopera
tives formed the National Union of Productive and Labor Associa
tions, which by 1923 consisted of 984 cooperatives with 49,360
members. Drawn into the current struggle between Socialists and
Fascists, this Federation was compelled to choose between liquidation
or “ reconstruction.” In 1923, the Federation adopted new aims,
admitted the new Fascist groups, and joined the Fascist National
(Sindacato Italiano delle Cooperative).
Ravenna continued to be the leading Province as regards member
ship of productive and labor organizations, though it was exceeded
in the value of contracts by Modena in the late 1920’s. Large projects
of land reclamation, the cost of which reached millions of dollars,
received widespread publicity. The cooperative printing groups re
ceived large contracts for printing railroad timetables, telegram forms,
and books for the Ministry of Education.
Agricultural labor cooperatives operated independently or accepted
contracts. In the North under the Fascists, cooperatives in Lom
bardy, Emilia, and Tuscany usually held and worked land collectively.
In the South, the cooperatives held the land but the members worked
it individually. In Sicily, for example, 77 cooperatives divided 41,573
acres among 19,200 members. In 1932, Italian farm cooperatives
held about 85,800 acres on lease and owned more than 16,000 acres.
2Hectare=2.471 acres.
232
Cooperatives in Individual Countries
Deflation of agricultural prices harmed this type of cooperative and
in 1935 collective leaseholds were reported to be on the decline.
Under the Fascists the fishing cooperatives proceeded with the de
velopment of a marketing system, and were aided by a credit law of
1931. In Naples a federation of cooperatives created a new market,
which was granted a monopoly of wholesaling fish in the region.
In the group of transport cooperatives, some expansion occurred
after Fascist domination began. The railway cooperative founded in
1904 still owned and ran the Reggio Emilia railroad in the early 1930,s.
The Mantua navigation cooperative owned boats and barges valued
at £10,000. The Genoa boat-building cooperative of 1883 remained
active. Porter associations received monopolies of the work in rail
road stations. Cooperatives provided taxi and transport service.
After Italy acquired possession of Tripoli in the wrar with Turkey,
the Government requested the workers7 cooperatives to undertake
the building of roads from Tripoli to other towns inland and along the
coast. The Fascist Government continued this policy, not only in
many of the early reconstruction projects but also in Africa.
T a b l e 72.— Operations o f Affiliates o f Workers’ Cooperative Federations at M ilan and
Genoa, 1 90 6 -3 5
[For par values of currency, see Appendix table, p. 278]
Year
Total
amount of
Italian
productive
and labor
cooperative
contracts
L ire
Milan Federation affiliates
Capital
L ire
1906.................
1910.................
1912.................
1914.................
1918.................
1919.................
5,220,450
10, 583,300
18,351,000
1921.................
1922.................
1924.................
1933.................
1935-.-............
166,225,269
123,548,478
285,475,635
561,254,477
500,000,000
(9
(9
0)
301,766
357,699
671,980
711,169
1,033,806
Value
Amount
of work
paid
performed in wages
L ire
2,148,375
3,343, 292
3,865,458
3,468, 575
5,293, 713
(9
<9
(9
0)
(9
(9
0)
(9
(9
(9
(9
<9
(9
(9
(9
0)
Asso
ciations
L ire
888,543
1,393,486
1, 768, 501
1,583, 780
1,773,902
(9
(l)
Genoa Federation affiliates
(9
(9
(9
(9
(9
(9
(9
Capital
Value
Amount
of work
paid
performed in wages
L ire
L ire
L ire
13
(9
(9
(9
(9
(9
(9
(9
(9
18
2,125,425
3,217,501
23,488,97$
21
16
5,339,966 12,045,708
8,269,498
(9
59,400,38$
587, 521
(9
(9
(9
(9
2,063,379
2,438,954
(9
(9
(9
(9
7,955,374
(9
(9
(9
(9
(9
1 No data.
Consumers’ Cooperative M ovem ent
EA R LY PERIO D
The Italian consumers7 cooperative movement developed in the
decade following the unification of Italy and, with a few exceptions,
succeeded best in the North where the spirit and economic prepara
tion for independence had been strongest. When in 1911 the Gov
ernment published comprehensive data describing the operations of
cooperatives, 1,764 or almost 33 percent of all cooperatives in the
nation were consumers7 associations and the majority of these were
in Lombardy, Emilia, and Tuscany; with a membership of almost
350,000 the consumers7 cooperatives were serving about 5 percent o f
the Italian population of 34,814,000. The variation in the size of
the cooperatives may be seen by comparing the membership of the
largest association— the Cooperative Union of Milan (with 14,566
Italy
233
members)— with the average membership of 213. Whereas the an
nual trade of the Milan Union had reached 10,732,609 lire, the ma
jority of the cooperatives were reported to have a turnover of less
than 50,000 lire.
In spite of the age of the movement, the success of cooperatives
in cities like Milan, Turin, and Verona, and the friendship of public
officials, the consumers’ cooperatives as a whole had failed to unify
either their policies or their organization. The National League of
Cooperative Associations (Lega Nazionale delle Cooperative) which was
formed in 1886, with headquarters at Milan, had never controlled the
policy nor had it been able to obtain the allegiance of the whole co
operative movement. Nevertheless its growth from 68 affiliates in
1886 to 2,189 in 1916 was impressive. Between 1910 and 1911 the
circulation of the League’s publication, Cooperazione Italiana, grew
from 2,300 to 6,000. As World War I approached, this periodical
complained that the Italian cooperative movement was “ more split
up” than any in Europe and that a distributive cooperative appeared
to be a private affair, “ almost a family center,” the aim of which was
merely the personal profit of its members.
The Italian consumer movement also lacked the services of a satis
factory wholesale association. Though such a wholesale appears to
have been suggested in 1887, it was not until 1905 that a Milan co
operative, “ Umanitaria,” gave 17,000 lire to begin both a coopera
tive wholesale and the auditing of cooperative association accounts.
It was hoped that the wholesale would curb the individualism of rival
cooperatives. Efforts were made to confine the wholesale’s trade to
large cooperatives only, and the Cooperative Union of Milan even re
fused to purchase at all until “ numerous distributive societies had
become amalgamated.” At first the new organization merely au
thorized the Milan Civil Servants’ Distributive Association to under
take purchases; next it undertook warehousing, but it overstocked and
almost went bankrupt, after which it served as a purchasing agency
only.
In 1910 the National League’s cooperative congress authorized the
creation of a wholesale later known as Consorzio Italiano delle Co
operative di Consumo. The following year, 1,500 shares of 25 lire
each were subscribed by various cooperatives in northern and central
Italy and 200 shares each by the Cooperative Alliance at Turin and
the Milan Cooperative Union. The wholesale handled coffee, sugar,
candles, sardines, wine from its own cellars, cheese, and (on commis
sion) flour, oil, butter, and rice. Although its sales grew rapidly and
earnings were made, the Consorzio was not well supported; at the
end of 1911 reserves amounted to only 1,998 lire, assets to 286,329
lire, and liabilities to 273,595 lire. In 1914 the Conzorzio had sales
of 1,431,276 lire on which net earnings of 21,901 lire were made.
The Government looked upon the cooperative distributive move
ment during the war as an “ ally of the State,’’ and continued to
befriend it in the post-war period. By 1921 the consumers’ cooper
atives numbered 6,481. Invigorating new life and even unity might
have been given the movement by means of the import and foreigntrade associations and the national federations which now appeared,
but dislocations based on post-war needs, and differences in labor
groupings, political allegiance, and religion, created new divisions.
588544°— 44----- 16
234
Cooperatives in Individual Countries
In 1919 the Government created the National Soldiers’ Aid So
ciety (Opera Nazionale dei Combattmti) with a fund of capital and
land. The soldiers seized the lands they desired, and formed coop
eratives for trade and industry. In 1917 the National League had
lost 600 cooperatives through the formation of a separate Catholic
federation. In 1919, the Christian Socialists or Roman Catholic
groups formed an entirely separate cooperative movement culminat
ing in the Confederazione Cooperativa Italiana, commonly known as
the “ White League.” In 1920 the Council of the National League
of the original cooperative movement abandoned the traditional
political neutrality and prepared “ to come to an agreement with the
General Federation of Labor and with the Italian Socialist Party in
Parliament,” thus acquiring the appellation of “ Red League.”
COOPERATION U N DER TH E FASCISTS
In the meantime Mussolini had organized his Italian Soldiers
Fascist Party in 1919 and at its congress in October of the same year
had been hailed as Duce of Fascism. Some Fascist cooperatives had
also been formed and by 1921 these had formed the Fascist Union of
Italian Cooperative Federations (Ente Nazionale fascista della Cooperazione), which claimed a continuous existence from that year.
The total number of consumers’ cooperatives at that time was
6,481; the ex-soldiers’ organization claimed 464, the “ White League”
2,940, and the Fascists’ Ente 35. By this time both the wholesale
of the National League and the Catholic federation had been reduced
to dealing only in dairy produce.
Only 120 Fascist cooperatives had yet been formed in Italy, but the
figures for the years 1921, 1922, and 1923 in tables 71 and 73 illustrate
the speed with which the cooperative associations collapsed before
the policy of coercion and terrorism adopted by the rising Fascist
groups. Table 73 shows the status of certain forms of cooperatives
in this period.
T a b l e 73.— Growth o f Specified Cooperative Groups in Italy, 1921—24
[For par values of currency, see Appendix table, p. 278]
Ex-soldiers’ co
operatives
Fascist cooperatives
Catholic coopera
tives
Item
1921
1923
1924
All types of associations:
Amount of business or
value of work done (lire). 50,000,000 650,000.000 840,000,000
Total amount of capital
(lire).................................. 3,435,000 36,430,000 60,450,000
Consumers’ associations..........
Number of members..........
Amount of business (in
lire)..................................
Productive and labor associa
tions.................. ......................
Number of members..........
Amount of business (in
lire)....... ...........................
Agricultural associations..........
i No data.
380
35
1923
1921
1923
0)
62,283,841
888,000,000
0)
0)
6,783,056
0)
92
2,940
180,000
14,645,882
750,000,000
0)
0)
(0
464
0)
(0
0)
0)
0)
1,400
0)
572
0)
166
984
49.360
0)
0) 47,637,959
52
112
138,000,000
(l)
60
(l)
0)
590
0)
25
0)
240
740
1921
430
0)
0)
0)
3,200
0)
(0
694
0)
0)
0)
235
Italy
In November 1925, a party of Fascists and police met the National
League’s president, as he was leaving the offices, and seized the keys.
A local deputy was appointed to liquidate the organization. In
1926 the national center of cooperation was transferred from Milan
to Home.
Late that year, a new law consolidated the State’s authority over
cooperative associations. Controversy over the place of the coop
eratives in the new corporative state was not fully settled in the
Fascist Grand Council of 1926 and 1927, which formulated the
Charter of Labor. In 1931, the cooperative associations were incor
porated into the syndicalist order, as regards the “ conclusion of labor
agreements,” and the cooperative federations were required to adhere
to the Fascist Ente. Rules for the operation of the Ente were pro
vided by the Ministry of Corporations. The position of the cooper
atives under the Commercial Code was only slightly changed. Presi
dents of the Ente and the federations had to be chosen from persons
approved by the Minister of Corporations and thus be members in
good standing of the Fascist Party.
The consumers’ cooperative movement continued, however. It
might even be said to have enjoyed some favor, for it was exempted
from the law of 1930 which prohibited the opening of new retail
stores “ except in newly settled centers or when it is a question of a
cooperative consumers’ shop.”
In 1927, the preponderance of consumers’ cooperative strength lay
in the North, as before the Fascist revolution. Of a total of 3,334
cooperatives with 826,845 members and sales amounting to
1,644,687,670 lire, the share of Lombardy, Piedmont, and Tuscany
was represented by the following figures:
N u m b er of
associations
1,305
Lombardy.....................
513
Piedmont.........................
Tuscany__________________________________
515
M em bers
314,012
138,263
117,370
A m o u n t o f sales
(lire)
706,378,283
260,799,708
171,216,023
By the early 1930’s, the consumers’ movement was reported to
include more than 3,000 associations with almost 1,000,000 members,
the great majority of whom were still to be found in the North. Cer
tain cooperatives developed services throughout the entire local
community. At Pietrasanta in Lucca, the consumers’ association was
said to feed the whole district and to maintain a bakery, butchery,
macaroni works, wine-cellars, and restaurants, as well as 70 branches.
The largest annual sales made by consumers’ cooperatives in 1931 were
those of the Cooperative Alliance of Turin (83,000,000 lire), but sales
of cooperatives in Trieste, Milan, Bologna, Pietrasanta, and Brescia
ranged from 65,000,000 lire to 20,000,000 lire, and 20 other coopera
tives sold goods worth about 8,000,000 lire annually.
By 1934 the consumers’ cooperative movement represented 3,860
associations in a total of 11,771 Italian cooperatives. The value of
consumers’ cooperative sales amounted to 1,600,000,000 lire, being
approached in value only by the agricultural purchase and sale co
operatives with a total of 1,300,000,000 lire. After the opening of the
Abyssinian campaign, the value of consumer sales began to decline,
whereas that of agricultural purchase and sale cooperatives increased.
The operations of the various types of associations affiliated with the
Fascist Ente in 1934 and 1937 are shown in table 74.
236
Cooperatives in Individual Countries
T a b l e 74.— Status o f M em bers o f Ente Nazionale Fascista della Cooperazione, 1934 and
1937 by T ype
[For par values of currency, see Appendix table, p. 278]
1934
Associ
ations
report
ing
Type of association
Consumers’ cooperatives............................ 3,860
Building associations.: ............................... 1,352
Workers' productive and labor associa
tions 3.......................................................... 1,194
106
Fishermen's...........................................
344
Transport associations...... ...................
Agricultural labor associations..................
350
Electricity associations..............................
0)
Agricultural cooperatives:
701
Purchase and sale__________________
Processing............................................... 3,665
Dairies............................ ........................
<9
Wine growers...................................... .
(9
Oil mills..................................................
0)
753
Agricultural insurance................................
Mem
bers
1937
Amount of
business
Associ
ations
report
ing
Mem
bers
Amount of
business
L ire
775,000 1,600,000,000
71,000 2 2,000,000,000
69,000
8,706
16,500
45,000
500,000,000
54,000,000
<50,000,000
0)
0)
<9
750,000
258,300
L ire
3,500
1,348
800,000 1,500,000,000
75,000 2 1,200,000,000
1,394
112
381
358
197
20,000
50,000
107,000
500,000,000
100,000,000
60,000,000
«110,000
<200,000,000
684
800,000
1,500,000,000
3,200
194
20
1,000
245,666
•6,000,000
•800,000
1,300,000,000
0)
0)
<9
(i)
?i)
35,000
to
70,000
0)
17,000
(9
35,000
<9
780,000,000s
1 No data.
3Value of buildings constructed.
3 Figures include other types than those indicated below.
4 Invested capital.
3 Hectares cultivated.
3 Quintals handled.
7 Insurance outstanding.
FASCIST COOPERATIVE W HOLESALE
In 1927, the Fascist Government tried to fill the lack of cooperative
wholesaling by founding the Wholesale of the Consumers’ Movement
(Ente Centrale Approvvigionamenti, known as “ E. C. A .” ) to buy at
wholesale and sell only to cooperatives. With head offices at Milan,
a purchasing office in Genoa, and a sales office at Como, this organi
zation sold to cooperatives mainly in northern and central Italy. From
the beginning, it had the support of the cooperatives in Milan, Turinr
Trieste, Bologna, Imola, ana Como. In 1930 and 1931, E. C. A.
handled rice, flour, oil, fish, and cheese. Data in table 75 show a
growth in sales which was almost fourfold between 1928 and 1932.
After 1933, E. C. A. gave up its earlier policy of buying on commission
and began to manufacture in its own factories.
T a b l e 75.— M em bership and Operations o f Fascist Wholesale, E . C , A ., 1 92 8 -3 2
[For par values of currency, see Appendix table, p. 278]
Year
Depend
Affiliated “ent”
or
Net earn
organiza ganiza Wholesale’s
business
ings
tions
tions
L ire
1Q9K
,
.
________________
1929..............................................
1930.............................................
1931..............................................
1932..............................................
84
108
150
176
251
33,365,918
122
418 68,509,439
635 73,483,378
872 96,106.735
1,233 115,526; 994
L ire
21,323
34,522
25,337
25,747
27,004
Sub
scribed
capital
Required
reserves
Special
reserves
L ire
L ir e
L ire
290,000
310,500
310,500
338,000
343,600
5,865
12, 769
17,837
22,986
12,133
21,264
25,005
36,20$
237
Ita ly
ST R U C TU R A L O R G A N IZA T IO N OF FASCIST CO OPERATION
Among the various branches of the Fascist cooperative movement
each had its own federation and, with the exception of those of the
credit cooperatives, these federations were in turn affiliated with the
Ente Nazionale fascista della Cooperazione. Table 76 gives for each
of the federations the membership and business done in the latest
available year— usually 1937.
T
able
76.— M em bership and Operations o f Italian F ascist Cooperative Federations, 1937
[For par values of currency, see Appendix table, p. 278]
Organization
Fascist Union of Italian Cooperative Federations (E n te N azion
ale fascista della Cooperazione) .........................................................
National Fascist Federation of Producers’ Cooperatives for
Collective Purchasing and Marketing...................................
Italian Federation of Agricultural Cooperative Associa
tions **....................................................................................
National Fascist Federation of Distributive Associations—.
Cooperative Wholesale of Distributive Associations___
National Fascist Federation of Housing Cooperatives.........
National Fascist Federation of Transport Cooperatives___
National Fascist Federation of Agricultural Labor Coopera
tives........ ....................................................................................
National Fascist Federation of Workers’ Productive and
Labor Cooperatives............................. .....................................
Central Office of Fishermen’s Cooperatives....................
National Fascist Federation of Agricultural Producers'
Associations.................................................................................
Dairies__________________________ ____________________
Wine growers’ associations____________________________
Oil mills................................. .................................................
Flour mills..............................................................................
National Fascist Federation of Mutual Aid Associations..,
National Fascist Federation of Mutual Livestock Insurance
Associations__*..........................................................................
Mutual Insurance Society of Cooperative Organizations * ..
National Federation of Rural Credit Associations (Raiffeisen)..
National Bank of Rural Credit Associations...........................
National Fascist Federation of Cooperative People’s Banks___
Num
Year to ber of
which member Their
figures associa members
apply
tions
1936
1937
15,647 3,317,730
830
800,000
1934
1937
1937
1938
1936
3,865
2,115
1,204
344
825,000
0
71,000
16,500
1935
350
45,000
1936
1936
1,224
106
70,000
15,000
1937
1937
1937
1937
1937
1935
260,000
3,358
3,130
240,000
194
16,000
2,300
20
14
0
3,823 1,300,000
1935
1937
1937
1935
1935
753
2,372
200
440
Their
business
L ir e
0
1.300.000.
000
855,000,000
1.300.000. 000
115,567,000
8
0
*500,000,000
*54,000,000
0
m
35,000
*71,000,000
/ *755,338,000
0
l 71,669,000
481,742 * 1, 200,000,000
*3,100,000
0
0
0
1No data.
* Central trading organization of preceding federation.
* Approximate value of contracts carried out in 1935.
* Data relate to 1935.
* Amount of insurance outstanding.
* Fire, accident, livestock, hail, and other insurance.
7 Premium income.
* Loans granted.
Italian Cooperatives in W orld W ar I I
Since the beginning of the Abyssinian campaign in 1936, very little
information has been issued regarding Italian cooperatives. Coopera
tive enthusiasm, however, was not permitted to flag either in Italy or
in the lands held by Italians in Africa. As the new empire expanded
in Ethiopia and Eritrea, efforts were made to develop oil, wine, and
dairy cooperatives. Cooperative organization was encouraged in
North Africa in Tripoli, Bengasi, Derna, and elsewhere. An exhibit
prepared for the Fiera di Tripoli showed the three branches of Italian
cooperatives—workers', consumers', and agricultural. In Libya late
in 1940, the Government named cooperative officials and mobilized
the most important cooperative groups.
238
Cooperatives in Individual Countries
In Italy, the Government passed legislation for the promotion of
cooperatives among small farmers. New cooperative organizations
appeared, for example the Consorzio Artisti in Rome, which planned
to produce films. In 1941 the national federation was endeavoring
to support the war effort by sending out manifestos to be displayed
in stores. These urged upon consumers the evil of hoarding and the
need for discipline and self-control. Cooperatives were warned to
favor their habitual customers but to prevent them from buying in
quantity. Everything was to be “ subordinate to the highest aim:
To conquer.” 3
Cooperative Movement in Portugal
Though the Portuguese cooperative movement was not strongly
developed at the time of the organization of the corporative state in
Portugal in 1933, the principles of the movement were known to the
Portuguese as early as 1848 and had been recognized in law in 1867.
By 1883 the movement consisted of about 60 credit, productive, and
consumers’ associations and some workers’ cooperatives in the North.
Cooperative organization and membership reached a peak of develop
ment at the end of World War I, though cooperative trade continued
to increase until the onset of the depression after 1929.
The National Federation of Distributive Cooperative Associations
(Federagao nacional das Cooperativas) was founded in 1920 and, for a
time, maintained an official journal. Though the success of the
Federation was hampered by its lack of wholesaling and the conse
quent lack of its affiliates’ loyalty, by 1927 the number of affiliated
associations and their members was 180 and 85,572 respectively—
a small showing, it is true, in a nation of some 6,000,000. The
Federation then owned property worth 23,000,000 escudos,4 and the
value of its annual trade amounted to 12,200,000 escudos, whereas
that of the affiliated associations had reached 105,000,000 escudos.
By 1929 there were only 270 cooperatives in Portugal, with a mem
bership of some 76,000, as is shown in table 77. Of this number,
150 associations were said to be consumers’ cooperatives with a mem
bership of 33,964 and a turnover of 35,000,000 escudos. Another
group included in the total consisted of 31,956 members organized in
52 cooperatives which performed both consumer and credit functions.
The Federation did not appear in the International Labor Office
directory of cooperatives of 1933, or thereafter, and information
regarding the Portuguese movement since the depression is slight. In
the early 1930’s, the Piedense Consumers’ Association of Caramujo
near Lisbon tried to combat unemployment by undertaking the manu
facture of corks, and the Government established the National
3 Sou rces .—1The report on Italy is based upon data from the following publications: Annuario Statistico
Italiano (Ufficio Centrale di Statistica, Home), 1917 and 1918; Annuario Statistico Italiano (Istituto Centrale di Statistica del Regno d’ltalia, Rome), 1938,1939; Sindacato e Corporazione, Bollettino di Informazioni
Corporative a Cura del Ministero delle Corporazioni, Rome, issues of March 1935, July-December 1939,
and June 1941; Cooperative Societies Throughout the World, Numerical Data (International Labor Office,
1939); International Directory of Cooperative Organizations (International Labor Office), 1936, 1939; Co
operative Information (International Labor Office), No. 8,1930; International Cooperative Bulletin (Inter
national Cooperative Alliance, London), issues of May, June, and September 1911, February, May, and
July 1912, February and July 1913, April 1914, April, October, and December 1925; Review of International
Cooperation (International Cooperative Alliance, London), issues of March and July 1931, and February
1935; People’s Yearbook (English Cooperative Wholesale Society, Manchester, England), 1930, 1931, 1934,.
1935; International Labor Review (International Labor Office, Geneva), issue of January 1922; The Coop
erative Movement in Italy, by E. A. Lloyd (G. Allan & Unwin, Ltd., London), 1925; Cooperation in Chang
ing Italy, by Karl Walter (P. S. King & Son, Ltd., London), 1934; and certain confidential sources.
* For par values of currency, see Appendix table, p. 278.
239
Spain
Federation of Portuguese Wheat Producers to “ help the farmers to
dispose of their crops at a reasonable price.”
T a b l e 77. — M em bership and Business o f Portuguese Consum ers9 Cooperatives,
1891-1929
(For par values of currency, see Appendix table, p. 278J
Year
1891.............................................................................................
1901.................................................................... ........................
1911.............................................................................................
1921.............................................................................................
1926 _____________________________________________
_
102ft
Associations
Amount of
trade
Members
E scudos
1
18
71
492
336
271
20
5,681
28,179
96,883
43,548
76,214
453
749,229
3,046,191
21,501,452
35,263,596
63, 925,614
Two Federations of Cooperative Agricultural Supply Associations*
one “ of Northern Portugal” and the other “ of Central Portugal,” were
listed as true cooperative organizations in 1933. That year, however,
a one-party corporative State was established and a Government
decree provided for the organization of all Portuguese economic life
on a corporative basis. Two years later, special legislation brought
agriculture within a guild system divided into regional unions and
provincial federations. The guilds were included within the corpo
rative body and provision was made for them to promote cooperative
associations for distributive, credit, and marketing purposes.
Cooperative activity in northern Portugal resulted in the formation
of the Federation of Cooperative Associations of Northern Portugal
in 1931. Membership reached 19,000 in 1935 and total trade
9,500,000 escudos, but detail describing the cooperatives’ activities
is lacking.6
Cooperative Movement in Spain
Although the Spanish cooperative movement began in 1860, the
first organizations soon disintegrated, not to reappear until the 1880’s
when a remarkably liberal cooperative law laid the foundation for
cooperative development.
Progress began with the formation of a
federation in the industrial region of Catalonia in 1897, the calling of a
congress, and the publication of the Catalonian Cooperative Review.
In 1908 when the population of Spain was about 19,000,000, the
membership of the cooperative associations was as follows:
N u m b er o}
associations
M em bership
A ll ty p e s __________________ ______ _______ ___________273
6 0 ,5 5 0
D istrib u tiv e __________________________________________ 182
P ro d u ctiv e ____________________________________________
17
C re d it___________________ ________ — ................................ 42
P ro d u ctive and cre d it________________________________
1
C redit an d s u p p ly ___________________________
22
P rod u ction , credit, and d istrib u tive_________________
1
B u ild in g_________________________________________
3
Sick ben efit_____________________________ _____________
5
29,000
4,900
6 ,5 0 0
200
19,150
100
700
_______
* Sou rces .—1The report on Portugal is based upon data from the following publications: Review of Inter
national Cooperation (International Cooperative Alliance, London), issue of February 1928; People’s
Yearbook (English Cooperative Wholesale Society, Manchester, England), 1932,1933,1939; Les institutions
de Pr6voyance du Portugal, Jose C. da Costa Goodolphim (SociStifi de GGographie de Lisbonne, Lisbon,.
240
Cooperatives in Individual Countries
By the early 1920,s, considerable growth in membership and in the
formation of cooperative federations had occurred, but the lack of
unity and the political and religious division (into Socialist, Catholic,
and “ neutral” groups), characteristic of Spanish cooperation, had been
intensified. From a population of some 20,000,000, the entire coopera
tive movement was then estimated to enroll only 262,000 members.
Beginning with the installation of a military dictatorship under the
monarchy, in 1923, many political changes occurred during the next
two decades, disrupting Spanish life. Under these changes the coop
erative movement waxed and waned, being encouraged under the
Republican Government, only to be absorbed into the corporative
form of government inaugurated under General Franco.
T ypes o f Cooperatives
The Spanish cooperative movement included not only consumers’ ,
workers’ productive, and housing associations, but also some rather
unusual forms. Among the latter were cooperative motor associations,
electricity, radio, building and health, pharmaceutical, printing, taxi
drivers’, olive-oil, orange-growers’, and shoe-repair cooperatives. In
Catalonia, one cooperative manufactured sewing machines and another
firearms.
The relative growth of the various types of cooperatives for which
data are available, in 1937, are shown in table 78.
T a b l e 78. — M em bership and B usiness o f Various T ypes o f Cooperatives in Spain , 1937
Associations
Type of association
P,on sum firs’ dist.rihnt.ivfl association s
__
................
Housing associations_________________________________________
Workers' productive associations (including fishermen)_______
Agricultural associations_____________________________________
Other associations_________ ___ _____________________________
1,803
13
847
3,056
7
Members
Business
F ra n c s *
1,178,817
63,566
79,617
400,688
162,000
13,638,000
(2)
2,220,000
(*)
1,084,000
i Swiss gold francs; for value, see Appendix table, p. 278.
*No data.
The most unusual of the large Spanish cooperative federations con
sisted of the fishermen’s associations (Pdsitos Marftimos) of which the
modern organization began about 1910. The purpose of these co
operatives was to enable the fishermen to own their equipment, to
sell their catch themselves, and to help them educate themselves.
By 1934 these cooperatives were organized into 9 regional federations
which covered the entire coast of Spain, and the Balearic and Canary
Islands. Some consumers’, credit, and productive branches were also
established within the fishermen’s movement and the adherence of
the Positos Marftimos to the National Federation and their collabora
tion in the Spanish Cooperative Wholesale gave the necessary strength
for the wholesale’s success.
Development o f Cooperatives Under the Republic
The Spanish Republic was established in April 1931, and for 5 years
clashes occurred among the various political groups. The Govern
ment of the Republic practised a policy of encouragement for co
241
Spain
operatives which included exemption from the payment of income tax
on cooperative net savings. A new general cooperative law was
enacted incorporating Rochdale principles and recognizing the follow
ing classes of cooperatives: Consumers' associations (including also
those which distributed water, gas, and drugs, or operated chemical
laboratories, buildings, transport systems, or schools); employees'
associations designed to improve working conditions; occupational
associations (workers' productive, small traders', and agricultural
associations); and credit and thrift associations.
By 1933, three regional federations were operating successfully:
The Catalonian (229 affiliated associations) with headquarters at
Barcelona, which began in 1899; that of northern Spain (43 affiliates),
with headquarters at Bilbao, which was founded in 1914; and that of
central Spain (23 affiliates), which began in 1932 and included a wide
variety of associations, among them one for printing and another
operating a colony for children.
The greatest cooperative success was achieved in the industrial
region of Catalonia. The growth of the cooperatives affiliated to the
Union of Catalonian Distributive Cooperative Associations is shown
in table 79.
T able
79.— M em bership and Sales o f A ffiliates o f Catalonian Cooperative Unionr
1906-37
[For par values of currency, see Appendix table, p. 278J
Number of
member
associations
Year and type of associations
■niptribiitivA ftssnr»mtfnns
Housing ftssnmat.inns
TTpalt.h assnpiat.inns
■Rlectrinity associations....
All typos l
_
1987
_
_ . _
659
5
7
6
.. __ _ .
__
_ ..
.
1934.............................................................................................
1090
1097
199fi
____________ __
1094
1093
1014
___________
ion«
____________
___
____
_
________________________________ _________________________________________
______________________________________________________________________________________________
. . .
______________ __________
_____________ _ ____________
Their
membership
346,017
148
162,000'
10,688
8 677
518,853
266
149
164
148
130
123
308
160
66,326
(8)
26,821
24,127
19,269
(8)
27,947
8,000
Their sales
Pesetas
49,718,000s
78,000
5,860,000
320,000
55,976,000
50,402,122*
35.000.
000
32,803,873
26,884,092!
16,560,686
12,856,716
14,574,000
10.000.
000^
1Not including workers* productive associations.
8 Plus 17 federations.
8No data.
Cooperatives D uring and Since the Civil W ar
The Cooperative Federation of Spain (Federacion nacional de cooperativas de Espana), founded in 1928, had at the end of 1934 a mem
bership of 482 associations, with about 157,000 individual members.
These included 343 consumers' distributive associations, 78 workers'
productive organizations, 8 building associations, 18 agricultural
marketing and processing associations, 8 mutual-aid organizations,
and 27 associations and federations for special purposes. Their total
paid-up capital amounted to 18,137,853 pesetas and their combined
business to 124,054,319 pesetas.
242
Cooperatives in Individual Countries
When the Spanish Civil War began in July 1936, the Federation
offered its services to the Government. The latter, taking advantage
of this offer, used the network of cooperatives as public utilities for the
distribution of supplies. Rapid expansion of the cooperative move
ment followed, and by 1938 the membership of the General Union of
Catalonian Cooperative Associations included 518,853 families, or
about 70 percent of the population in Catalonia. In at least one
town, all economic life was organized on a cooperative basis. The
Government gave the newly established Cooperative Wholesale
Association (Cooperativa Central de Abastecimiento) the status of an
official body and granted the Federation a seat on the National
Committee of Food Supply. At the beginning of 1938 there were
reported to be 1,200 consumers’ cooperatives in Spain with a member
ship of 833,000 families.
After the defeat of the Loyalists and assumption of power by
General Franco, the new government announced that the old coopera
tive system and law were “ not in harmony with the orientation of the
new State.” A law of November 1938 required all cooperatives to
re-register and draw up new rules. Many cooperators became refugees,
among them the secretary of the National Federation who led the
first group across the frontier on February 1, 1939.
On January 2, 1942, a new cooperative law was passed which
integrated the whole cooperative organization into the totalitarian
structure of the country. It established a central control and imposed
a system of regional and national bodies in which membership was
compulsory. Each branch of the movement had to be affiliated to the
“ syndicate” for that branch. These syndicates appeared to be partly
or entirely Government bodies. They had no authority over the
business operations, but had a voice in the ‘ ‘appointment” (not election)
of the cooperative officials. The syndicates, in turn, were controlled
and their officials selected by the higher bodies of the “ political and
economic hierarchy.” 6
Balkan Countries
The outstanding facts to be noted regarding cooperation in the
larger Balkan countries— Greece, Bulgaria, Rumania, and Yugo
slavia— are the striking development it managed to achieve in spite
of a succession of devastating wars and political upheavals and the
important part it played in improving the condition of the people.
Before the outbreak of World War II the cooperatives in Greece were
serving about 20 percent of the population, in Bulgaria and Rumania
about 30 percent, and in Yugoslavia some 40 percent. The Bulgarian
cooperatives accounted for nearly 25 percent of the total retail trade
of the country.
6 Sou rces .—1
The report on Spain is based upon data from the following publications: Anuario Estadistico
de Espana; Instituto Geografico, Catastral y de Estadistica (Madrid), 1934,1935; International Directory of
Cooperative Organizations (International Labor Office) 1929, 1936, 1939; Cooperative Information (Interna
tional Labor Office), No. 12,1938; International Cooperative Bulletin (International Cooperative Alliance,
London), issue of February 1924; Review of InternationalCooperation (International Cooperative Alliance,
London), issues of October 1934, June and April 1935, January, February and September 1936, February
and May 1937, May and September 1938, April 1939, and April 1943; Monthly Labor Review, issues of
April 1924 and October 1927; People’s Yearbook (English Cooperative Wholesale Society, Manchester,
England), 1918, 1929, 1932, 1933, 1937; C. Gide, La Cooperation dans le Pays Latins, AmGrique Latine,
Italie, Espagne, Roumanie (Paris, 1928); and certain confidential sources.
Bulgaria
243
In Bulgaria the Government intervened in the affairs of the coopera
tives from time to time to assist or curb the movement, and in Greece
where cooperatives were, in the main, rural, the associations were
encouraged in various ways by the Government. The Rumanian
cooperative movement had always been under the close tutelage of
the State, which was sometimes helpful, sometimes repressive. In
Yugoslavia, on the other hand, although public officials were usually
friendly and publicly acknowledged the achievements of the coopera
tives, the progress of the movement had generally been attained by the
efforts of the cooperatives themselves.
Yugoslavia may be said to be the birthplace of cooperatives devoted
to raising the sanitary and health condition of the members, and all
its cooperatives were interested in cultural and welfare activities.
Diversification and variety were features of the cooperative move
ment in all of these countries except Rumania. The Balkan coopera
tive movement, in fact, included some types rarely found in other
countries. Among these were the collective-farming associations,
those distilling attar of roses, and the “river associations” engaged in
reclamation, irrigation, and flood control, in Bulgaria; the cooperative
“ settlement” associations for refugees in Greece; the forestry associa
tions in Rumania, supplying not only the domestic market but also
engaging in foreign trade; and the health and medical-care associations
of Yugoslavia, already mentioned.
In all of these countries, except Greece, the cooperatives were
federated into strongly knit central organizations; and the two move
ments in Bulgaria and Yugoslavia also had an international organiza
tion to further cooperative relationships between the two countries.
With the outbreak of the second World War, Bulgaria and Rumania
became satellites of Germany, whereas Greece and Yugoslavia resisted
Nazi aggression. Reports indicate that in Bulgaria the cooperative
movement continued to expand. In Rumania, which lost substantial
amounts of territory which it was forced to yield to Bulgaria and
Hungary, a corresponding loss to the cooperative movement was en
tailed through these territorial shifts; it appeared also that the coop
eratives in the remaining territory were being largely ignored in war
time measures adopted by the Government and were “ completely
overshadowed” by the mass of State machinery created to put these
measures into effect. In Greece, devastated by war and dismember
ment, it appears from such scanty reports as are available that the
invaders have not only allowed the cooperatives to operate but have
made use of their facilities. The same has been true in Yugoslavia.
Cooperative Movement in Bulgaria
Among the outstanding characteristics of the cooperatives in
Bulgaria was their great diversity. All of the various branches of
cooperation— consumers', credit, insurance, agricultural, and workers'
productive—were found in Bulgaria. In addition, these various
branches included not only the usual types found where the coopera
tive movement is well developed but also some rather novel forms of
cooperation. Thus, the consumers' group was composed not only of
the usual supply associations providing food, household supplies, etc.,
but also of school (students') cooperatives and medical-care associa
tions. The credit cooperatives included both people's banks (urban)
244
Cooperatives in Individual Countries
and agricultural credit associations of the Raiffeisen type many of
which also operated retail stores handling both consumer goods and
farm supplies. Among the agricultural cooperatives were not only
the usual joint buying, processing, and marketing associations but
also associations of cocoon growers, forestry associations, collective
farming associations, and associations distilling attar of roses. The
workers’ productive associations included forestry, water-supply, and
electricity cooperatives, as well as handicraftsmen’s associations buy
ing raw materials and marketing the products.
The Bulgarian cooperative movement was also well integrated,
each branch having one or more central unions which were in turn
members of nation-wide federations.
By the end of 1941 the cooperative membership of all types of
associations numbeied 1,288,915, representing over 15 percent of the
population. Although Bulgaria is primarily an agricultural country,
about 62 percent of the cooperative membership in 1939 was in urban
areas and only 38 percent in rural districts.
Development o f Cooperatives, 1 9 0 0 -3 9
Bulgaria, formerly under Turkish rule, became an autonomous
Province in 1878 and an independent nation in 1908.
The first cooperatives in Bulgaria were of the credit type and were
promoted by a Turk, Mithat Pascha. After autonomy was granted
m 1878, the credit cooperatives were reorganized and federated into a
new central organization, the Agricultural Bank of Bulgaria. The
first Raiffeisen association was formed in 1897, but this type of associa
tion at first spread slowly. Early in the 1900’s a few distributive
associations were formed, the first being a bakery that soon failed.
In 1907 a general cooperative law was passed and that same year
the General Union of Agricultural Cooperatives was formed. At that
time practically all of the 240 cooperatives in operation were agricul
tural cooperatives, mainly of the Raiffeisen type. At this point
political parties began to take an interest in the cooperatives and to
try to influence their administration. According to one commentator,
“ soon almost every political party, and each profession, had influence
over cooperative societies.”
By 1909 there were some 600 cooperatives. Cooperative develop
ment, however, was interrupted first by the Balkan wars and then by
the first World War.
After the end of that war, the cooperative movement began to
expand and to federate. In 1919 the workers’ productive associa
tions and those doing purchasing of supplies and marketing of products
for small craftsmen formed a Union of Productive Cooperatives. In
the same year the Social-Democratic Party established a central co
operative organization, called “ Napred” (“ Forward” ), to act as a
cooperative union and wholesale for the urban distributive associa
tions. Starting with a membership of 7 associations, 4 years later it
had 69 member associations with a combined membership of 43,000.
In 1919 the Communist Party, which was gathering strength,
formed a distributive cooperative with branches in all the localities
where there was a sufficient number of Communists to support a store.
245
Bulgaria
B y 1923 this association had 64,000 members. The Communist Party
was declared illegal in 1923, and the various organizations of the
Party (including the retail cooperative association) were abolished
under a special law “ for the defense of the State.” By 1928 all coop
eratives under political influence had disappeared or had become
neutral in policy.
During the difficult period of the twenties all types of cooperatives
in Bulgaria continued to grow in number and membership, except the
consumers’ cooperatives. The closing of the large Communist co
operative had reduced the total distributive membership veiy con
siderably. Another factor in the reduction of the retail distributive
movement was the fact that the credit associations were more and
more undertaking consumer functions and opening retail stores. Also,
an earthquake occurred in 1928, in which 237 cooperative buildings
were destroyed and 50,000 cooperators lost their homes.
The trend of development of the various branches of the Bulgarian
cooperative movement from 1920 to 1939 is shown in table 80. As it
indicates, notwithstanding the control imposed by the Government
and the increasingly stringent restrictions upon trade and foreign
exchange, all branches of the cooperative movement showed a growth
between 1936 and 1939. Part of the apparent drastic reduction in
insurance cooperatives is due to the fact that the 1939 figures do not
include the 2,200 cattle-insurance associations which were dropped
(without explanation) from the official statistics in 1935. In the
same year considerable changes were made in classification, so that
there is some question as to the comparability of the 1936 and 1939
figures for the productive associations with those of previous years.
T able
80.— Num ber and Membership o f Bulgarian Cooperatives in Specified Years,
1 9 2 0 -3 9 , by T ype
1920
Type of association
1925
1929
1936
1939
Asso Mem Asso Mem Asso Mem Asso Mem Asso
cia
cia
cia
cia
cia Mem
bers
bers
bers
bers
bers
tions
tions
tions
tions
tions
All types.................................... 1,705 348,892 2,202 516,588 3,200 709,009 4,964 882,984 3,438
950,571
Consumers’ distributive_____
387 116,790
154 84,347
187 80,503
138 72,259
97,937
161
Credit,....................................... 1,003 121,845 1,335 199,191 1,707 319,271 2,115 391,182 2,378 441.981
Hygiene, public works, hous
ing, etc.:
Housing.............................
22
3,775
79
145
7,919
7,060
0)
0)
0)
0)
Building and loan......... .
8
28,804
10 28,195
Health and public works.
30 16,365
30
16,616
Purchase and sale:
Agricultural.......................
219 58,771
125 36,324
139 52,965
6,396
20
18
6,898
Industrial and commer
24
cial....................................
1,674
2,609
49
3,633
40
94
6,758
99
8,727
2
4
2
370
Liberal professions............
281
678 (2)
(2)
(2)
(2)
Insurance...................................
32 64,149
221 137,146
700 187,618 1,969 206,142
«9 8151,634
Production:
Production and mutual
aid....................................
49
2,839
129 55,078
80 34,381
723 197,639
567 143,542
105
Production and labor____
59
113
2,206
3,747
1,199
4
2
157
Labor...................................
6
35
5
57
12
16
335
1 These associations (mostly apartment buildings) were abolished under a 1935 law forbidding ownership
of dwellings “ by floors.”
* This classification was dropped without explanation in 1935.
* The cattle-insurance associations previously carried in this group were dropped without explanation
In 1935; they numbered 2,243 (with 224,644 members) in 1936,685 in 1929, and 208 in 1925.
246
Cooperatives in Individual Countries
Relations W ith the Government
The Government of Bulgaria was always interested in the coopera
tive movement and from time to time intervened to assist or regulate
it or to assume increased control; it also made regular statistical
surveys of the extent of the cooperative movement.
In 1924 it opened a Higher School of Cooperation, for the purpose of
training employees and managers for cooperative associations, with
2-year courses covering cooperation in all its branches, accountancy,
foreign languages, agriculture, etc.
The military revolution that took place in May 1934 resulted in the
overthrow of the constitutional monarchy. All political parties were
abolished and the formation of new ones was prohibited. King Boris,
who had remained on the throne, overthrew the military dictatorship
early in 1935 and continued to rule under an increasingly totalitarian
form of government.
At the same time the Government increased its control over the
cooperative movement. By a legislative order (No. 163, October 18,
1934) it merged the Agricultural Bank (a State organization) with the
Central Cooperative Bank which made loans largely to urban asso
ciations. This measure, it was felt, would tend toward greater co
hesion among the various branches of the cooperative movement and
make for a more even distribution of funds. Although designed to
promote the development of various kinds of cooperatives, this order
also permitted the Government to exercise supervision over the work
of all the cooperatives and gave the Government authorities the right
to remove any officers or administrators in the cooperative movement
not acceptable to them and to replace them by their own appointees.
Cooperative apartment associations were abolished under a decree
of 1935 forbidding ownership of housing accommodations “ by floors.”
Government representatives were given seats on the board of directors
of the General Union of Agricultural Cooperatives (which had always
been strictly neutral in political matters). The cooperative union and
wholesale, “ Napred,” which had been established by the SocialDemocratic Party but had become independent of party control and
had adopted a policy of political neutrality, was left untouched and
was assured of the friendliness of the Government.
Later, not only were the Government restrictions relaxed, but the
cooperative movement was given representation on the Economic
Council, and two active cooperators were given portfolios as Govern
ment Ministers.
Status o f Various Branches o f the M ovem ent9 1939
At the end of 1939, the cooperative movement had a combined total
of 950,570 members out of a population of 6,077,939. The distribu
tion of this membership, classified to show the relationship of the*
various branches of the movement, is shown in table 81.
24?
Bulgaria
T a b l e 81.— Num ber and M em bership o f Cooperatives in Bulgaria, 1939 , b y T ype o f
Association
Type of association
Alltypes__
_
_ _ _ _ _ _ ____ ____
Associations
_
_ ___
Consumers’ distributive associations ___
____
_
_
___
Public works, health, etc., cooperatives __
_ _ _ _ _ _ _
Credit cooperatives:
Agricultural credit (mainly Raiffeisen)
_
_ __ __
_
People’s banks. .................. ..................................................................................
Building and loan associations
.
Other types........ ................................ .................................................................
Productive associations:
Cooperative workshops
_______ _ r _ _ ____
Labor associations_________ _____ ___ _____ _________________ :__________
Productive associations, industrial and other........ .......... .............................
Purchase and sale associations and associations of small craftsmen and trades
men............................................................................................................................
Insurance associations_____________________________________________________
Agricultural cooperatives:
Productive and labor l
_ _ _ __ ___ _
Marketing and supply_________________________________________________
Members
3,438
960,670
161
30
97,937
16,616
1,978
276
8
124
161,484
220,308
28,804
60,189
107
12
423
1,063
336
122,328
99
9
8,726
151,634
193
18
74,258
6,898
1 Includes forestry, landholding, etc., associations.
Cooperative credit associations.—Even as early as 1931 the coopera
tive credit associations were regarded as “ the best-organized and
soundest cooperative societies” in Bulgaria. By 1939 there were
nearly 2,400 of these associations, of which about 2,000 were agricul
tural-credit associations of the Raiffeisen type and some 275 were
people's banks serving mainly urban and village (nonagricultural)
populations. As already noted, a great many of the Raiffeisen asso
ciations also carried on a retail distributive business. Nearly half of
the total cooperative membership of Bulgaria in 1939 was in the co
operative credit associations.
The people's banks were much larger in size than the agriculturalcredit associations, with an average membership of nearly 800 as com
pared to less than 100. These banks not only granted loans to their
members but had advanced considerable sums in long-term credit to
local public authorities for various kinds of public works such as con
struction of electric-power plants, waterworks, etc.
Insurance associations.— Of the insurance associations, the Coopera
tive Insurance and Savings Society of Bulgarian Civil Servants was
the most important. It wrote life, fire, and accident insurance, and
combined policies to cover building construction. It also carried on
extensive welfare activities, including holiday homes for its members,
medical service, and a modem laboratory for chemical research.
Agricultural cooperatives.— In Bulgaria the cooperatives among the
farmers were of great importance and represented a wide variety of
activities. As the Bulgarian law prohibited more than one agricul
tural cooperative in a village, the associations therefore performed all
kinds of services for their members, besides marketing their crops.
The forestry cooperatives were of two types— those composed of
owners of small plots of forest land, who formed associations in order
to work their holdings jointly, and (far more numerous) labor associa
tions composed of forestry workers. These last undertook contracts
for the State, the local authorities, schools, etc., for planting, felling,
transporting, and even working up the lumber. They also purchased
groceries, tools, and other supplies for the members. In 1937 there
248
Cooperatives in Individual Countries
were 131 of these forestry associations that were affiliated to the Union
of Cooperative Forestry Societies (Gorski kooperativen soyus).
Collective-farming associations were among the more recent types
o f agricultural cooperatives, this kind of cooperative having made its
first appearance only in the last decade. The members of these
associations were mainly persons owning or leasing land. They
worked the land collectively and through the associations also sup
plied themselves with agricultural machinery, implements, and other
farm supplies, carried on soil-improvement work, constructed roads
on the holdings, furnished legal and other advice, and had a broad
social, cultural, and educational program. The members supplied
the share capital, paying also an annual fee of 60 leva 1 which was
applied on the purchase of additional 100-leva shares. The members
were paid according to number of hours of work performed, plus
ground rent for their land. At the end of 1940 there were 21 such
associations with 1,601 land-holding members. They had in cultiva
tion, that year, 29,500 decares (7,290 acres) of land. Since 1939 these
associations have been under the supervision of the Agricultural and
Cooperative Bank.
An unusual type of agricultural association was the association
distilling attar of roses. The first organization of this type was
started in the 1920,s. By 1933, it is reported, these cooperatives had
won a dominant position in the market (with 96 percent of the total
product) and had “ made an important contribution to the rose
growing industry ,” which had suffered greatly from the competition
o f synthetic perfumes.
Before the war the annual marketing business of all types of agri
cultural cooperatives amounted to between 2 and 2K billion leva, in
addition to about 1 billion leva in distributive business (farm supplies,
services, etc.).
Most of the agricultural cooperatives belonged to the General
Union of Agricultural Cooperative Societies. In 1936 (the latest
data) it had in membership 393 local associations grouped into 38
federations; these had some 200,000 members.
Workers’ productive associations.—At the end of 1932 the Bulgarian
Central Cooperative Bank created in its organization a handicrafts
men^ section. Its principal duties were to encourage the formation
o f cooperative associations among handicraftsmen, to organize the
sale of their products, to buy supplies and raw materials for them, and
to give them vocational training. The International Labor Office
characterized the results of this program as “ remarkable.” During
1933 about 200 new associations were formed, so that at the end of the
year there were 302 cooperatives among handicraft workers; most of
these were buying supplies for the members.
By the end of 1939 there were over 500 workers’ productive associa
tions of all kinds, with about 124,000 members. These figures would
be increased considerably if the forestry labor associations were in
cluded; the Bulgarian official statistics classify this latter type of
association with “ agricultural cooperatives” but do not show separate
data for them.
Among the varied types of cooperatives were the so-called “ river”
associations (soctitfe aes rividres), the first of which was formed in
For par values of currency, see Appendix table, p. 278.
Bulgaria
249
1919. These operated mainly in rural districts and were classified
in the official statistics among the associations “ in the field of pro
duction/J Among the activities carried on by these associations were
irrigation, draining of marshes, flood control, construct on of dams,
generation of electricity, and extraction of salt from the sea. Certain
privileges were allowed to these associations, such as the right to use
crown lands, exemption from specified taxes, special railroad shipping
rates, etc. In certain cases membership in the loca river association
was compulsory for both municipalities and landowners. Their
activities were regulated not by the cooperative law but by a special
statute enacted on September 20, 1920, and new associations could be
formed only when the necess ty for them was proved to the Ministry
of Agriculture and Crown Lands. At the end of 1926 there were 43
such associations, with 36,523 members. No later data are available
for these associations separately.
DEVELO PM EN T OF CONSUMERS’ COOPERATIVES
The retail distributive associations constituted the greater part of
the consumers’ cooperative movement of Bulgaria. There were,
however, some associations of other types, notably student cooper
atives and those for provision of medical care. Also, in 1929, a
women’s cooperative guild was formed in Sofia.
The first cooperative health association was formed in 1931 in
Burgas, a port on the Black Sea, with the purpose of founding a hos
pital. The initiative in this move was taken by a group of doctors,
local cooperators, and other citizens. The hospital was opened in
July 1934. At that time it had in membership 316 individuals and 29
corporate members (people’s banks, cooperative credit associat ons,
cooperative federations, the town of Burgas, and even the central
Government of Bulgaria). The success of this cooperative led to the
formation of so many similar schemes, not all of which were genu ne,
that the Bulgarian Government in 1935 drew up a law specifically to
regulate them and to set standards to which they must conform.
In 1938 the retail distributive cooperatives were doing almost 25
percent of all the retail business in Bulgaria. The greater part of this
Was accounted for by the distributive associations federated in the
cooperat ve union and wholesale soc ety, “ Napred,” formed in 1919.
In 1940 this body had in membersh p 69 local associations, with 87,938
members. Although its affiliates constituted only 42 percent of all
the consumers’ cooperatives in the country, their membership com
prised nearly 89 percent of the total membership of the consumers’
cooperatives in Bulgaria.
Napred was, before the war, the largest organization in wholesale
trade in Bulgaria. It carried on an extensive export and import
business, was the sales outlet for the salt produced by an agricultural
cooperative syndicate, and led all the businesses in Bulgaria in the
sale of sugar, rice, salt, oil, and cereals. In 1939 its capital amounted
to about 550,000,000 leva. It had substantial productive enterprises
from which were drawn some of the supplies for its retail affiliates.
Among these were plants for canning vegetables, fish, and milk prod
ucts ; a cheese factory, rice farm, and flour mill, and an electric-power
plant that, besides generating power for the cooperative mill, supplied
electricity for the nearby town. In 1938 Napred joined with a co588544°— 44----- 17
250
Cooperatives in Individual Countries
operative association of beet growers, an insurance association, and
the People’s Bank in forming a new organization called Cooperative
Sugar Factories, which produced 70 percent of the country’s sugar
supply. Later, with the assistance of the Swedish Wholesale Society,
Kooperativa Forbundet, Napred began the construction of a rubber
factory.
Its sales rose from 556,900,000 leva in 1937 to 1,140,000,000 leva
in 1942 (the latest year for which data are available).
T a b le 82.— M em bership and Business o f Bulgarian Cooperative Wholesale, Napred , om
Its Affiliates, 1 9 2 3 -4 2
[For par values of currency, see Appendix table, p. 278J
Member associations
Year
Num
ber
Their
members
Their business
Leva
0)
Wholesale
distributive
business of
Napred
Leva
1923.....................................................................................
1925.....................................................................................
1927........................................................................ ...........
1930.....................................................................................
1931.....................................................................................
69
60
54
57
58
42,968
45,249
46,588
60,277
62,780
1,254,700,000
1,436, 229,548
410.019,431
351.684, 239
(0
1,186,862,000
1,801,075,292
436,819,728
423.802,872
1934.....................................................................................
1935.....................................................................................
1938.....................................................................................
1940.....................................................................................
1942.....................................................................................
58
61
66
69
78
64,000
69,000
80,478
87,938
100,000
175,254,644
0)
620,600,000
656,400,000
0)
439,035,480
609,838,359
687,000,000
698,167,000
1,140,000,000
i No data.
Data are for 1839.
Intercooperative Relations
The whole cooperative movement of Bulgaria culminated in the
National Committee of Bulgarian Cooperation, to which 10 of the 12
federations in the various branches of cooperation belonged. Its
functions included defense of the interests of the cooperative movement,
coordination of their activities, and organization of publicity and
educational work regarding the movement.
In April 1937 the Yugoslav-Bulgarian Cooperative Institute was
formed in order to establish “ a system of permanent collaboration for
the promotion of the cooperative movement and of mutual economic
assistance in the two countries.” The bylaws emphasized, however,
that the Institute “ has no political aims, and its attitude toward
political organizations and movements is one of strict neutrality.”
The membership consisted of the General Federation of Cooperative
Unions in Yugoslavia and the National Committee of Bulgarian Coop
eration and the Bulgarian General Union of Agricultural Cooperative
Societies. The headquarters of the organization were to be in which
ever country the person currently serving as president lived.
Cooperatives and the W ar
In September 1940, Bulgaria, “ yielding to mingled threats of in
vasion, promises of territorial compensation and economic pressure,” 2
signed a compact with Germany, making it a satellite country. As
Bulgaria was used as a base from which Germany attacked Yugoslavia
2New International Yearbook, 1941, p. 86.
Greece
251
and Greece, the fate of the Yugoslav-Bulgarian Cooperative Institute,
above noted, can be imagined.
Only meager information is available as to the effect of the war on
the cooperatives in Bulgaria. It is known that the agricultural coopera
tives and the credit associations have been acting as agents of the
Government in the collection of agricultural produce. Even as early
as 1940 it was reported that over two-thirds of the associations’
marketing business consisted of the handling of Government-con
trolled produce. In 1942 over a third of all the agricultural products
marketed in Bulgaria were handled by the cooperatives.
One outcome of war conditions has been the entrance of cooperatives
into the canning and preserving industry. Bulgaria had been, since
the beginning of the war, exporting considerable quantities of fruit
and vegetables. Because of the necessity of utilizing to the utmost
the available transportation facilities, it seemed desirable to ship these
commodities in the least bulky form. Hence the drying, cann ngr
and preserving of these goods became an important industry, in which
by the end of 1941 from 22 to 37 percent of the product was the output
of cooperatives. Eight of the 23 tomato canneries, 99 of the 300
strawberry-collection centers, 13 of the 18 vegetable and fruit dehy
drating plants, and 5 of the 12 cold-storage plants belonged to co
operative assoc ations.
Data for 1941 for the various branches of cooperation in Bulgaria
indicate that all of them had increases in membership. In comparison
with the pre-war year, 1939, the total cooperative membership in
Bulgaria rose nearly 36 percent (from 950,570 to 1,288,915). In 1941
the members accounted for a little over 15 percent of the population.
Both share capital and reserves showed increases
The wholesale
association, “ Napred,” made progress in both 1941 and 1942, its
business in the latter year showing a 60-percent increase over 1940.
It appears, therefore, that at the end of 2H years of warfare the
cooperative movement was not only holding its own but was making
gains; it is not known to what extent the cooperatives are free to act or
how far their facilities are being utilized in the interest of the totali
tarian State policies.3
Cooperative Movement in Greece
The cooperative movement in Greece—largely agricultural— dates
only from 1914 when the first legal authorization for cooperative
associations was passed. Once started, however, it grew rapidly.
To a considerable degree this growth was due to the encouragement of
the Government, which turned to the cooperatives as an aid in the
various problems with which it had to deal. It even sent organizers
to help start cooperatives. Cooperative settlement associations were
favored as a means of distributing land to the people during the
agrarian reforms. General-purpose cooperative associations helped
S o u rces .—The report on Bulgaria is based upon data from the lollowmg publications: Bulgaria, Direction
G£n£rale de la Statistique, Statistique des Cooperatives dans le Royaume de Bulgarie, 1927,1932,1933,1937, and
1940; International Cooperative Bulletin (International Cooperative Alliance, London), issues of April 192$
and April 1924; Review of International Cooperation (London), issues of March 1925 and November 1942;
Cooperative Information (International Labor Office), Nos. 13 and 20,1928, Nos. 6 and 11,1929, Nos. 4 and
16,1931, Nos. 5 and 16,1934. No. 11,1935, No. 14,1937, No. 6,1939, No. 7,1941, and No. 8,1942; International
Directory of Cooperative Organizations (International Labor Office), 1939; Industrial and Labor Informa
tion (Geneva), March 17,1924; and People's Yearbooks for 1929, 1933. and 1935, through 1941.
252
Cooperatives in Individual Countries
to solve the problem of caring for and rehabilitating, economically,
the persons who fled into Greece from Turkey and southern Russia
after the first World War, as well as those involved in population ex
changes with Bulgaria and Turkey— altogether 2,000,000 persons.
Despite the decade of war, the change of government from con
stitutional monarchy to republic, and the stresses entailed by the
absorption of masses of people, the cooperative movement grew
steadily. Because of the turbulent times and the speed and manner
of growth, it was said that “ neither the cooperators themselves nor
the authorities had time to organize the idealistic side of the move
ment.” By 1930, however, it was reported that even persons who
had joined accidentally, as it were, had come to realize that the
cooperative association was “ an institution which with mutual help
will improve conditions of life.”
The agricultural cooperatives had always been favored by the
authorities. The 1914 law granted them certain postal facilities
and various exemptions from taxation, and provided penalties for
persons hindering their operation or endeavoring to dissuade others
from joining such associations. A later law, that of January 22,
1919, forbade the seizing, by personal creditors or members, of
agricultural produce consigned for sale by members, or of the proceeds
of such sales. An added stimulus was given to the formation of
agricultural associations by the agrarian laws of 1917 and 1920,
which provided that grants of land expropriated by the State from
the large landowners might be made t> cooperative settlement
associations, formed for the purpose.
The cooperative movement has, therefore, been predominantly
rural, with the rural credit associations forming by far the largest
single group.
T ypes o f Associations
The steady development of the movement is indicated by the
accompanying statement showing the number of urban and rural
associations in existence at the end of specified years.
Total
1921................................................................. 1,710
1924.............................................. ................... 3,655
1 9 2 7 - ............................................................. 5,714
1930................................................................. 7,387
1 934 .................................. .............................. 9, 197
1936................................................................. 9,611
R ural
(*)♦
2, 801
4, 481
5, 754
0)
6, 270
U rban
P)
854
1, 233
1, 633
0)
3, 341
i No data;
l, by types, as follows:
Total
R u ra l
U rban
611
All types__________ __________ ___________ ________ ____ 9,9,611
6, 270
3,341
625
4, 476
1, 684
493
514
7
37
946
33
796
156
4, 401
469
75
1, 684
3
Insurance associations.
Fishery associations. __
Cooperative federations.
490
514
1
708
7
37
946
32
88
Greece
253
In 1918 the 917 associations of all types had a combined membership
of 45,070. By the end of 1938, the membership of the cooperative
associations in Greece numbered about 300,000. Taking into
consideration the families of the members, the cooperative movement
at that time was, therefore, serving about a fifth of the population.
About 65 percent of the agricultural population were members of
or served by the cooperatives. The movement was strongest in
the Peloponnesos and Macedonia; next in importance were Thessaly
and the Aegean Islands.
Urban cooperatives.—As the foregoing tabulation indicates, the
urban associations were of more varied type than the rural organi
zations, including as they did the workers’ productives, and the
housing, insurance, and fishery associations for which there were
no counterparts in rural areas.
As noted, the productive associations formed about half of the total.
These were composed of craftsmen in various trades— tailoring, shoe
making, hairdressing, shipbuilding, etc.— and workers taking con
tracts for labor. Among the last group were the porters’ and the
stevedoring associations in the harbor cities. In 1928 the porters’
associations had 2,357 members.
The number of building associations increased rapidly after the
end of the first World War, when the waves of refugees flooded the
country with families for which there was no housing. Several laws
were passed to encourage the construction of new dwellings. Co
operative housing associations were given special privileges, including
exemption from building taxes and from import duties on building
materials.
The distributive associations also grew quickly during the war of
1914-18, when provisions were difficult to obtain. Possibly because
of the lack of cooperative education previously mentioned, when the
food shortage was over, many of the associations disappeared.
The urban associations, scattered over the country, had little or
no relations with each other and no central federation. They were
under the jurisdiction of the Minister of National Economy, and
were given none of the advantages accorded to the agricultural
cooperatives. Greece is one of the few countries in which the con
sumers’ cooperatives have never federated into a central body.
Agricultural cooperatives.—The credit associations have constituted
more than two-thirds of the farmers’ cooperatives. About one-third
of these associations, it is reported, carried on side-line activities such
as the purchase of farm and household supplies, processing and sale
of farm products, and warehousing. Among the agricultural process
ing and productive associations were those raising silk cocoons, and
those producing olive oil, wine, currants, etc. Included in the miscel
laneous group, “ other types,” were the many associations formed under
the agrarian laws, for the purchase, improvement, and leasing of land.
The Greek law gave specific authorization for the formation of
associations not only for resettlement of expropriated lands, but also
for drainage and irrigation of land. It also provided, regarding the
latter, that if the approval of such an association by three-fourths of
the residents of a village could be obtained, membership was obli
gatory for the other fourth. By the end of 1928 there were 1,585
resettlement associations with a membership of 93,000 families. They
had distributed to their members over lji million acres.
254
Cooperatives in Individual Countries
In 1930 the agricultural cooperative law was amended to provide
for the dissolution of any cooperatives which “ become members of
political parties, or pass political resolutions in their meetings, or use
their property or funds to assist any political party, or take part in
meetings which are concerned with political questions.” Any person
who was a candidate for either House of Parliament or for the position
of mayor was barred, for a period of 3 years thereafter, from member
ship on a cooperative committee or board of directors.
Further amendments to the law, enacted in June 1931, prohibited
such cooperatives as were doing purchasing for their members from
buying any goods in excess of the amount represented by their actual
orders in hand; in other words, this amendment prevented any ware
housing or stocking of goods by these associations. Membership in
an association was limited to residents or property owners in the asso
ciation’s area of operation. Associations were required to deposit
all reserve funds in the Agricultural Bank, having for their own use
only the interest thereon. The same law gave the auditors of the
Agricultural Bank the right to attend any meetings of a cooperative’s
members, committees, or board; and gave them powers as “ public
agents of inquisition, under the criminal law, and for certain cases,
as pyblic prosecutors.”
In 1939 a law was passed which placed all cooperatives under the
supervision of a new office, the Under-Secretariat of Cooperative
Societies, responsible to the Prime Minister.
Cooperatives and the W ar
Italy, which had previously taken possession of Albania, invaded
Greece through that country in October 1940 and was reinforced in
April 1941 by German troops when the Greeks not only had driven
out the Italians, but had occupied about a third of Albania. After
that time the condition of Greece and its people grew progressivly
worse.
No direct reports are available as to the situation of the cooperative
movement since the invasion and dismemberment of the country.
Word through indirect channels indicates, however, that the author
ities have not only allowed the cooperatives to continue operation
but have made use of them in collecting and distributing supplies.
It appears, therefore, that the cooperative machinery is still in existence,
though subverted to the conquerors’ purposes.4
Cooperative Movement in Rumania
Unlike the situation in certain other countries, the Rumanian coop
erative movement did not suffer particularly in the war of 1914-18,
notwithstanding that the country was invaded by Austrians, Germans,
and Bulgarians. Individual associations were looted, destroyed, or
taken over and operated for the invaders, but as a whole the associa
tions continued to operate about as usual.
4 S o u rc e s —The report on Greece is based upon data from the following publications: Annuaire statistique
<le la Grece, 1937 (Athens, 1938); International Cooperative Bulletin (International Cooperative Alliance,
London), November 1919; Review of International Cooperation (published by International Cooperative
Alliance, London), issues of June 1930, September 1932, and April 1938; People’s Yearbooks for 1933, 1938,
1940, 1941, and 1942 (published by English and Scottish Cooperative Wholesale Societies); Cooperative In
formation (published by International Labor Office), No. 13, 1928, No. 11, 1929, No. 3, 1930, and No. 3,193%
International Review of Agricultural Economics (Rome), October-December 1923; Economic Review
(London), May 15, 1925; New International Yearbook, 1939; and Task of the Cooperatives in Post-War
Belief and Reconstruction, by Halbert, Shoskes, and Tereshtenko (Washington, 1943).
Rum ania
255
At the close of the war, the old Kingdom of Rumania was enlarged
by the addition of considerable territory taken (“ liberated” ) from other
countries— Bessarabia from Russia, and Bukovina, Transylvania,
and the Banat of Temesvar from Hungary. The acquisition of these
territories resulted in a considerable accession of cooperative associa
tions also. Authorities estimated that, with these new accessions
added to the 630,738 members of peopled banks and the 63,699 mem
bers of agricultural cooperatives in old Rumania, there were altogether
about 1,300,000 cooperative members even at that early date.
Development o f Cooperation Under State Supervision and Control
In Rumania, more than in any other country in Europe, the history
of the cooperative movement has been one of close relationship with
the Government, a relationship that has sometimes been helpful,
sometimes dominating and repressive.
Even before the war of 1914-18, relations between the Rumanian
Government and the cooperative movement had been very close.
The relationship has continued throughout the 25-year period since
that time, with the State exercising a great deal of supervision and
control, generally favoring but sometimes discriminating against the
movement, and always expending large sums for the maintenance of
the supervisory machinery and even for cooperative subsidies of one
kind or another. At no time could the cooperative movement in
Rumania have been said to be really independent or entirely selfsupporting. This fact was commented upon in 1927 by Charles
Gide, eminent French cooperator and educator6 who noted that the
cooperative movement in Rumania occupied a peculiar status, with
the State “ exercising oyer the cooperatives a tutelage well-meaning
but not despotic, conferring upon them official attributes” and thereby
making them a branch of the public administration.
He said that he did not blame the Rumanian Government for its
policy toward the cooperative movement, in view of the fact that the
Rumanian people, having been for centuries in a state of near-serfdom,
were not yet ready for the spontaneous, self-directed action necessary
for real cooperation.6 He commented, however, that control by the
political state was likely to go on indefinitely and that the time never
came when the pupil was deemed able to go on alone.
This indeed was the case in Rumania. Lacking the sound sturdi
ness and self-reliance of the movements that have been built up by
the unaided efforts of the cooperators themselves, the cooperative
associations there remained very small, their own capital very limited,
and their reliance upon public funds very great.
Some of the Government measures taken in regard to the coopera
tive movement were remarkably enlightened. Among these may be
cited the educational work done under the 1929 law, and the relations
maintained with the International Cooperative Alliance and with the
cooperative movements of other countries. The only objections
were that they represented steps taken for but not by the movement
itself, and that the fortunes of the movement were, thus, inevitably
tied up with those of the political state.*•
6 Gide, Charles: La Cooperation dans les Pays Latins. Paris, Association poor L ’Enseignement de la
Cooperation, 1928(?), p. 207.
• The same was true of a large part of the Yugoslav territory prior to 1920, but there, in spite of the terrible
poverty and the ignorance of the peasants, the movement developed independently of Government
assistance.
256
Cooperatives in Individual Countries
LEGISLATION ON C O OPERATIVES, 1903-35
Gide noted in .1927 that, being under the continuous attention of
the public authorities, the cooperatives suffered from a “ superabun
dance of laws.” In a period of 13 years at least 10 laws were passed,
each modifying or superseding its predecessors. In the next 15 years
almost the same number of acts and decrees established, abolished,
and revised all or parts of the cooperative machinery and procedures.
Even as early as 1903 the Government had passed a consumers’
cooperative act. It had also formed the Central for People’s Banks
to supply the local credit cooperatives with funds, as well as to control
their activities.
Law of 1929.— In 1929 under a law of March 28, applying to all the
territory of Rumania, the whole previous organizational arrangement
of the cooperative movement was abolished.
Under the law the associations were authorized to form federations
on either a regional or a type basis. Such federations were to be
autonomous. However, the usual cooperative practice was reversed,
in that these federations, instead of being under the control of their
member associations, were given power not only to control these
affiliates, but also to organize their educational activities. “ Chief
authority” in the movement was to be given to a central organization
to which the regional unions would be affiliated.
Pending the organization of this central body, a National Office
of Rumanian Cooperation was to carry on its functions, under the direc
tion of the General Cooperative Council, half of whose members were
to be elected by the cooperatives and half “ nominated by the various
authorities concerned.”
Educational activities under 1929 law.— One distinctly favorable
phase of the situation was that the National Office of Rumanian Co
operation immediately set about organizing educational work for
and in the cooperative movement, expanding and developing that
which the associations themselves had started previously. Four
training schools for cooperative employees were started in various
places, which provided 2 years of theoretical teaching and 10 months
of practical work in selected cooperative enterprises. These schools,
in the scholastic year 1930-31, gave instruction to 385 students.
As early as 1919 the Government had established in Bucharest the
School for Advanced Cooperative Study, for the giving of both special
ized and general training. This school was reorganized in 1929, its
curriculum being widened and the course extended to 2 years. Special
courses designed for the training of managers and officials were also
organized in different parts of the country.
Beginning in 1930 radio talks and motion-picture films were used
as a means of acquainting the public with the cooperative movement—
a rather remarkable occurrence in a country as little developed as
Rumania.
Courses in cooperation were also required in the curriculum of all
schools and colleges giving instruction in agriculture; lectures on
cooperation were given at the Universities of Bucharest and Jassy
and at 65 theological schools and seminaries, and in 1928 a chair of
cooperation was created in the Academy for Higher Commercial
Studies.
Debt-conversion law oj 1933.— In 1933, in the attempt to improve
the condition of agriculture, a law was passed providing a 5-year
Rumania
257
moratorium on agriculturists’ debts. The cooperative credit associa
tions were singled out in one provision which wrote off 25 percent of
their outstanding loans, besides reducing the rate of interest allowed
to be charged on loans. As the assets of the credit cooperatives
amounted to 6,800,000,000 l ei7 at the beginning of the year, the 25percent write-off alone meant a loss of 1,700,000,000 lei. It took the
cooperative credit movement several years to overcome the effects of
this blow.
Law of 1985.— Although the 1929 law involved a good deal of
Government supervision (largely of a benevolent nature), it was on
the whole favorable to the development of the movement through the
latter’s own efforts. The central union provided for under the law
never actually materalized, and the National Office for Rumanian
Cooperation (part official, part cooperative) continued to function
until 1935. In that year, under a change of government, a law was
passed on March 27 which abolished the organizational arrangement
of the 1929 law and established an elaborate structure consisting of a
Central Office of Cooperation and subsidiary bodies for banking,
purchase, marketing, and control. The central and its subsidiaries
were given control not only over the associations that chose to affiliate,
but also over the nonaffiliated associations. The autonomous regional
federations that had previously been formed by the local cooperatives
were also abolished. The new central organizations were given power
to audit the accounts of the local associations, to cancel decisions of
their general meetings, to dismiss elected officials and cooperative
employees, and even to liquidate associations. It was openly charged
that the purpose of the law was to guarantee control by the party ;n
power. This law was in operation until June 1938, but the Central
Office was able to obtain the affiliation of only a very small proportion
of the total number of associations.
T ypes o f Cooperative Associations and Their Activities
The cooperative associations of Greater Rumania tend to fall into
a few classes: Credit; consumers7cooperatives (with which the official
statistics usually include the rural farm-supply associations); agri
cultural associations, including the land-lease and land-purchase associ
ations; the forestry associations, and a group of service associations;
a n d productive associations, i n c l u d i n g agricultural processing
associations (such as dairies), as well as both urban and rural associa
tions carrying on productive activities in various industrial fields.
COOPERATIVE CREDIT ASSOCIATIONS
The first type of association to be started in Rumania was the
“ people’s bank,” a form of cooperative credit association, the first of
which was founded in 1891. These associations were fostered by a
group of village school teachers whose purpose was to assist the
peasants in escaping from their burden of debt to the local usurious
money lenders. The idea took hold very rapidly and by 1903 there
were 1,027 of these banks. By 1913 their number had grown to 2,901
with 584,632 members (in a population of 7,508,000). Their out
standing importance in the cooperative movement was indicated by
» For par values of currency, see Appendix table, p. 278.
258
Cooperatives in Individual Countries
the fact that all other types of cooperative associations combined
(about 869) had only 25,538 members. The banks not only acted as a
source of credit but also did some purchasing of farm supplies as well as
marketing of members, products.
In 1903 the Government had formed a department— the Central
for People’s Banks— to which control over the people’s banks was
given.
In the annexed Provinces, the credit cooperatives were largely of
the Raiffeisen and Schulze types and were those of the German and
Hungarian people. Very few credit cooperatives were found before
the war among the Rumanian population of the “ liberated” Provinces;
they had supplied their credit needs largely through the joint stock
banks, having adopted that form of organization mainly because of
the close ties of the Hungarian credit cooperatives with the Govern
ment, and “ the Rumanian population disliked being assisted by the
Hungarian State, fearing an interference also with their national
life.” After the first world War, the credit associations created by
the Rumanians in the annexed territories tended to be of the people’s
bank type and to become a part of the Rumanian Central for People’s
Banks; the minority populations continued with both Raiffeisen and
Schulze associations and maintained also the central federations
which had previously been formed.
At the end of 1936 about a fourth of the credit associations and
membership was in the annexed Provinces. Of 5,235 local associations
at the end of the year, 4,709 were affiliated with the 53 regional
federations, and all but 531 of these were of the people’s bank type.
T
able
83.— Developm ent o f Credit Cooperative Associations in Rumania in Specified
Years, 1 9 1 3 -3 8
[For par values of currency, see Appendix table, p. 278J
All associations
Year
1913 L__........................
19181.............................
1926..............................
1929...............................
1933...............................
1935...............................
1936.............................
1938...............................
Number
Members
2,901
2,965
4,413
5,286
5,291
5,267
*5.235
6,140
583,632
641,359
915,388
1,134,018
1,131,827
1,096,259
1,102,841
1,120,130
Minority associations
Number
8
Members
Rumanian associations
Number
Members
2,901
2,965
4,413
4,732
(2)
4,674
4,633
4,525
583,632
641,359
915,388
1,002,926
(2)
957,751
963,637
975,130
?
(2)
554
(2)
593
8602
*615
(2)
131,092
(2)
138,508
139,204
*145,000
Loans
granted
L ei
152.000.
000
156.000.
000
2,892,000,000
6.300,000,000
(2)
3,119,000,000
2,985,000,000
1,141,000.000
i Data relate only to cooperatives in old Kingdom of Rumania.
* No data.
* Not including 92 Jewish cooperatives in Bessarabia under the Commercial Code.
* Estimated.
consum ers’
c o o p e r a t iv e s
In the old Kingdom of Rumania, consumers’ cooperatives had
existed in the urban areas as far back as 1900. The cooperative act
of 1903 resulted in the formation of a few others which were short
lived. The first rural consumers’ cooperative was started in 1902,
and by 1908 there were 150 of this type; the chief commodity sold by
most of them, however, consisted of alcoholic drinks. There were,
to offset these, some 62 temperance associations formed under a law
of 1908, with 2,145 members.
259
Rumania
By July 1920, there were 424 urban cooperatives in the old Ru
manian territory with about 50,000 members. The associations were
very small and were found only in the city of Bucharest (which had
142 associations) and the few other big towns. The larger part of
the consumers7 cooperative movement at that time consisted of the
rural supply associations, some of which also did marketing of agricul
tural products.
Table 84 shows, for the combined supply and consumers7 coopera
tives, the trend of development of both the associations of minority
groups and of those of Rumanian stock in certain years. Separate
data are also shown for the consumers7 cooperatives among the
Rumanians.
T
able
84.— Development o f Supply and Cot sumers’ Cooperatives in Greater Rumania,
in Specified Years, 191 2 -3 8
Supply and consumers’ cooperatives
Year
Total
Number
1912i......................................
19241......................................
1929........................................
1935.........................................
1936.........................................
1938.........................................
294
2,516
2,132
1,536
1,632
2; 791
Mem
bers
13,105
288,722
289,961
208,302
214, 321
8 154,735
Minority asso
ciations
Number
(2)
C)
467
444
453
370
Mem
bers
(2)
C)
104,839
82,386
82,028
C)
Rumanian asso
ciations
Number
294
2,516
1,665
1,092
1,179
2,421
Mem
bers
13,105
288,722
185,122
125,916
132,293
«154,735
Rumanian
consumers'
cooperatives
Number
294
(*)
(*)
766
824
1,810
Mem
bers
13,105
C)
(8)
85,831
89,500
8117,360
i Data relate only to associations in old Kingdom of Rumania.
* No data.
* May include some membership of the racial minorities.
PRODU CTIVE ASSOCIATIONS
The productive associations include miscellaneous types of coopera
tives, the oldest form being that of the land-leasing associations. In
the annexed territories, no productive associations of any kind existed
before the first World War.
Land associations.— Before the first World War, the land in Rumania
was held largely by the great landowners, so that the only way for
the average farmer to obtain land for cultivation was to rent it from
these owners. As individuals, none could handle enough land to be
considered worth while; as members of a cooperative, however, they
could rent considerable tracts of land jointly. It was customary,
then, for the cooperative to lease a tract, parceling it out to the mem
bers, each of whom worked his plot or plots individually, but utilized
the threshers and other machinery of the cooperative. After the end
of the war, the great estates were broken up and the land was given
free (in lots up to 500 hectares8) to the peasants, the owners being paid
in paper money. The early type of land association, being no longer
so necessary, became greatly reduced in number and by 1920 had
fallen from 605 to about 160. Pending final allotment of land to
individual farmers, the Government adopted the expedient of turning
over tracts to groups of farmers, forming them into a cooperative
association for the purpose. By 1920 there were over 2,000 of these
associations.
8 Hectare** 2.471 acres.
260
Cooperatives in Individual Countries
As the division of the expropriated lands was carried to completion,
and the need for the leasing associations became less urgent, these
associations also tended to decline. On the other hand, a later type
of association, that for the purchase of land, expanded in importance.
Forestry associations.— The first forestry associations were started
early in the twentieth century but their development was slow until,
in 1910, the Government adopted a policy of letting contracts to co
operatives to exploit the timber in State-owned forest land. This
policy was extended in 1918 to cover the great mountain regions that
were thickly forested. The development of these associations was
hastened, after the end of the first World War, ironically enough, as a
result of the wartime-supply activities of the German authorities
when they occupied the country. In order to get supplies of wood
and lumber, they built light railroads into the forests and in some cases
built sawmills as well. In one territory, after the war, the Rumanians
found 120,000 cubic meters of wood already cut. The Central for
Agricultural Cooperatives, established in 1919, organized an associa
tion for the exploitation of these forested areas, with membership
open to women. A decree of 1918 had authorized the sale of State
forest land to cooperative associations, with provision for certain
advantages to residents of the mountain districts where many of the
forests were found.
As 22 percent of the area of Greater Rumania was forest land, and
as the lumber industry occupied third place in productive output of
the country, naturally these associations became important. The
associations were of three types— those to supply the lumber require
ments of the members, those to manufacture rough timber for the
market, and those working up lumber for building purposes. The
third group developed some very large and powerful associations, own
ing not only lumber mills but also warehouses and short railroad
lines, as well as rolling stock for these lines. Some of these associa
tions also engaged in export as well as domestic trade.
To some extent, the development of these associations fluctuated
with the varying State policies. Thus, in the twenties and the early
thirties, the Government favored exploitation of the forest resources
through State monopolies rather than through cooperative associa
tions, and this fact, along with the unfavorable economic conditions,
caused a decrease in the number and activity of these associations.
In 1936, thanks to the influence of a Government Cabinet Minister
friendly to cooperatives, the former policy was resumed and the condi
tion of the associations improved accordingly.
By 1938 there were 448 forestry associations registered, but nearly
100 were in liquidation. The 247 which supplied information had
about 28,000 members.
These forestry associations were given certain preferential treat
ment, being exempted from stamp taxes and from all charges con
nected with legal proceedings; certain other taxes were reduced by from
25 to 75 percent. The associations were also given preference as re
gards purchases of lumber by public welfare and charitable institu
tions.
The International Labor Office noted, regarding these associations,
that they had “done much * * * to improve the material and
moral conditions of the population among whom they work. There is
hardly a village in the mountain districts where they have not erected
261
Rumania
or repaired a school, a church, or a building for some charitable pur
pose.”
All of the forestry associations (except one whose members were
Hungarians) were those of the Rumanian people.
Other 'productive associations.— The other types of productive co
operatives were those for the production and sale of various com
modities. In the rural areas these were generally associations for pro
duction and marketing of fish, dairy produce, quarrystone, coal, etc.,
whereas in towns they included bakeries, printing plants, tanneries,
and weaving establishments. This group also contained the one co
operative insurance association in all Rumania, writing fire, life, and
hail insurance. The minority groups were well represented among the
productive associations, as table 85 indicates.
All types of productive associations.— During the 13-year period
ending in 1936, the whole group of productive associations declined
both in number and in membership (table 85), but this was due to the
trend of the forestry and land associations; the “ other productive”
cooperatives nearly tripled their number and almost quadrupled their
membership. By 1938 both number of associations and membership
were about at the 1923 level.
T
able
85.— Trend o f Developm ent o f Productive Cooperatives in Greater Rum ania, in
Specified Years, 1912-38
Total
Tear
1912...........
1923...........
1929..........
1935...........
1936...........
1938...........
Land lease and
purchiase associ- Forestry assoations : Ruman ciations: Ru
manian
ian
Number
of asso Members
ciations
Num
ber
544
1,085
1,135
673
8 741
l, 571
63,915
149,406
128,690
76,126
« 83, 459
127, 686
389
8496
484
207
231
468
Mem Num
bers
ber
55,707
882,295
46,116
20,770
24,629
25,686
143
4 476
*492
191
* 207
448
Mem
bers
8,208
4 57,935
62,401
23,565
«25,062
728.000
Other productive associations
Minority
associations
Rumanian
associations
Num Mem Num Mem
ber
bers
ber
bers
Num Mem
ber
bers
TotaJ
‘ 12
(2)
113
9,176
159 20.173
275 31,791
303 33,768
* 655 *74,000
(2)
(2)
(2)
(2)
51
5,733
93
8,879
111 10,432
216 730.000
12
113
108
182
192
39
(2)
9,176
14,440
22,912
23,336
4,000
1 Associations operating under the CommerciaJ Code in 1914; no membership data given
* No data
8 Data are for 1918.
4Data are for 1924.
8 Data are for 1928.
6Includes 1 Hungarian forestry association with 841 members.
7Approximate.
8Includes 400 associations with about 40,000 members, nationality not reported.
Cooperatives o f National M inorities
The new territories assigned to Rumania after the end of the first
World War contained not only the Rumanians formerly under Hun
garian and Russian rule, but also sizable groups of other nationalities,
each of which had developed its own cooperative associations (some of
these also had been favored and even organized by the Russian and
Hungarian Governments). These latter continued to retain their
national identity even after they became a part of Greater Rumania.
The various Rumanian laws and decrees governing cooperatives
applied to the “Liberated Provinces” as well as to the old Kingdom.
The Slavs throughout greater Rumania tended to become members
of “Rumanian” cooperatives, but apparently no steps were taken to
262
Cooperatives in Individual Countries
ward fusion of other nationalities, even when cooperatives were being
consolidated for greater stability of operation. The minority coopera
tives, indeed, grew in number under Rumanian rule. Thus, in
Transylvania there was a German as well as a Hungarian cooperative
movement, the latter of which retained its former affiliation with a
branch of the Hungarian Cooperative Union and Wholesale
(“ Hangya” ), which became an independent organization after the
partition of Hungary following the World War. Each of the other
racial minorities— the Saxons of Ardeal, the Swabians of the Banat,
the Jews in Bessarabia, and the Germans, Poles, and Ruthenians in
Bukovina—had its own group of associations.
The part played by the minority associations in the cooperative
movement of Greater Rumania in 1936 is shown q table 86.
T a b l e 86. — Cooperative A ssociations in Greater Rum ania in 1936 , by N ationality , Location ,
and T ype
Type of association
Minority associa
All nationalities
Rumanian associations
Num
tions
ber
of
fed
Rural Urban
Total
asso
era
Total Rural Urban Total
associa
Rural Urban
cia
tions associa
tions
tions
tions
Number of associations
All typos „
„
_ __ _
CJrftdHr
Onnsiimpra*.
Supply _______________
Productive (including agrinnlt.nrftl) _
60
7,608
6,716
892
1,167
1,095
72
6,441
5,621
820
i 56
*4
6,235
1,193
439
4,638
1,087
381
697
106
68
602
369
84
664
359
82
48
10
2
4,633
824
356
4,084
728
299
649
96
56
741
610
131
112
100
12
629
510
119
Membership
All types........— . . . _____ _____ 1,400,621 1,146,660 264,061 232,506 200,855 31,650 1,168,116 946,705 222,4U
Profit
________
^onsunier?’ _
Supply ________________
Productive (including ag
ricultural) ____________
1,102,841
167,979
66,342
83,469
906,420 197,421 139,204 115,877 23,327
128,916 29.063 68,479 62,349 6,130
221
46,286 11,057 13.649 13.328
66,939 16,620 11,273
9,301 1,972
963,637 789,543 174,094
89,600 66, 567 22,933
42,793 31,957 10,836
72,186 57,638 14,548
i 3 of these belonged to minority groups.
* 2 of these belonged to minority groups
Rumanian Cooperatives Just B efore the W ar
Up to the onset of the depression in 1929 the total number of
cooperatives and their members had increased. From that year
through 1935 both number and membership declined.
In 1936 the cooperative movement was described in an official
publication as being in a “ serious depression.” Altogether, a loss of
945 associations and 152;048 members was shown as compared with
1929. The largest relative losses were those of the forestry, land,
and consumers’ cooperatives; the productive associations had, on the
other hand, increased.
“ Hangya,” the union and wholesale of the Hungarian cooperatives
in Rumania, had in affiliation at the end of 1937 some 325 local asso
ciations with 65,000 members and an annual business of 237,000,000
lei. The wholesale itself in 1937 had sales amounting to 121,000,000
263
Rumania
lei. The German consumers’ cooperatives, although they had suf
fered from the depression, had survived and shown a considerable
improvement in 1938. They had their own wholesale association,
which not only marketed supplies but did a distributive business as
well. In 1937 the .German Union of Raiffeisen Cooperatives had in
affiliation 190 associations with 18,411 members; its wholesale society
was serving 54 local distributive associations with 4,352 members
and had an annual business of 38,042,000 lei. The wholesale itself
had sales in that year of 13,300,000 lei.
^COOPERATIVE
reform ”
LAW OF 1938 AND ITS EFFECTS
In February 1938, an authoritarian constitution was adopted and
King Carol proclaimed the Rumanian Front of National Regeneration
which replaced all political parties.
Shortly afterwards another cooperative law was passed, effective
June 22, 1938, which in its turn abolished the Central Cooperative
Office and its subsidiaries, and substituted a whole new set of coopera
tive machinery headed by a National Institute of Cooperation under
the Rumanian Minister of National Economy.
By the end of 1938 there were in existence 10,080 cooperative
associations, distributed by type as follows:
A ssociations
T o t a l.................................................................................................... 1 10, 080
C red it a ssocia tion s_______________________________________
Su pply and consum ers’ a ssocia tion s_____________________
A gricultural associations:
F o re stry ____ _________________________________________
L an d lease an d purchase____________________________
O ther (service, e t c .) _________________________________
P ro d u ctiv e associations, urban and rural_______________
M em bers
1 1, 453, 127
5, 140
2, 791
1, 120, 000
154, 735
448
468
39
657
2 8 ,0 0 0
25, 686
4 ,0 0 0
70, 000
1Includes 537 associations with 50,706 members, not reported as to type, the greater number of which
were in liquidation.
After the passage of the 1938 law, the National Institute subjected
the local associations and their administration to a searching examina
tion with a view to “ the sorting out of viable units,” the liquidation
of “ artificial establishments,” and the “ amalgamation of the lessimportant societies.” At the end of the year, nearly 2,000 associa
tions, of the 10,080 on the register, were reported to be in process of
liquidation. Thus, many of the consumers' cooperatives, about a
fourth of the supply and marketing associations, about 100 of the
forestry associations, and 19 land-purchase associations were being
dissolved.
It appeared, however, that the majority of the associations were
making progress and an official report expressed the opinion that the
“ new constitutional era” which “ had the effect of abolishing the polit
ical struggles of the country, offered the cooperative movement the
possibility of escaping from foreign influences, thus permitting it to
recover the real autonomy enjoyed before the [first World] War.”
At the end of 1938, altogether 1,453,127 persons out of a population
of 18,850,000 (or about 7.3 percent) were members of cooperatives of
one kind or another. Counting the family members, about a third
of the population was, therefore, served by the cooperative movement
in that year.
264
Cooperatives in Individual Countries
Rum anian Cooperatives in W artim e
In 1940 Rumania again lost a considerable part of its territory, as
a result of the war. Southern Dobroqea, which had been part of the
old Rumanian Kingdom, was taken by Bulgaria, Transylvania was
shifted to Hungary again, and Bessarabia went back to the Soviet
Union along with northern Bukovina. The remaining territory be
came a German protectorate. The territorial shifts reduced the
population by nearly 6,000,000 (about 30 percent) and the territory
by 39,000 square miles (about 34 percent). Rumanians constituted
about 85 percent of the Kingdom’s population in 1941, as compared
with about 72 percent prior to the 1940 partition.
By these transfers considerable numbers of cooperative associations
were also lost to the Rumanian cooperative movement. The greatest
cooperative losses were in Transylvania, but the cooperative move
ment was also well developed in Bessarabia and northern Bukovina,
whose cession reduced the total number of cooperative associations in
Rumania by over 13 percent and the membership by 12 percent.
The recovery of Bessarabia as a result of the German-Russian War
restored a large part of these losses.
The use of the cooperative movement for the distribution of food
to the people is indicated by a decree-law published October 1, 1940,
which required the National Institute of Cooperation to carry out the
instructions of the newly created Ministry of Coordination “ with
regard to general food supplies.”
In 1941 the cooperative law was again completely revised, and a
new law was written incorporating the law of 1935 together with the
enactments of June 23, 1938, January 20, 1939, October 18, 1940,
and February 22, 1941. The law contained the usual standards for
cooperatives, besides regulating in detail the powers and procedures of
cooperative associations and defining the powers and duties of the
National Institute which, as previously, is under the supervision and
control of the Ministry of National Economy.
In 1942, by a series of decrees, control over the cooperative move
ment was increased, and the National Institute became one of the
main agencies carrying out the Government’s agricultural policy.
Under it, productive and warehousing facilities were greatly increased
but, the International Cooperative Alliance pointed out, the coopera
tive associations had been “ completely overshadowed” by the mass
Government agencies. “ Farmers’ communities” were also provided
for, which were to take over most of the functions of the former
agricultural cooperative associations. A new type of “ village bank”
was created by the Government, to the capital of which the credit
cooperatives were to be “ allowed to contribute” ; these banks were
directed to work with the rural cooperative associations for the pur
pose of accelerating agricultural production. The cooperative asso
ciations of the German minority were federated into three central or
ganizations, a central bank, and a national association of Raiffeisen
cooperatives.
By-passing the consumers’ cooperatives also, the Government
resorted to a plan (designed to protect the consumers from blackmarket operations) of compulsory consumer groups for the joint pur
chase of food and other essentials. These groups were to be organized
Yugoslavia
265
in factories, offices, and other business enterprises, as well as in public
institutions.9
Cooperative Moveriient in Yugoslavia
Yugoslavia, the Kingdom of the Serbs, Croats, and Slovenes, was
assembled after the first World War, from Serbia, Montenegro, and
bits of territory formerly governed by Austria-Hungary, and Austria
and Hungary jointly. The cooperative movement there had, there
fore naturally developed under diverse conditions. Nevertheless,
except in Montenegro, each region had a thriving cooperative move
ment.
A Yugoslav cooperator, writing in the Review of International
Cooperation for December 1941 pointed out that the Yugoslav is a
‘ ‘ born cooperator. ” “ The primeval family community of the southern
Slavs, the so-called zadruga, still exists in many places to this day
* * *. The conception of a State organized as a single huge zadru
ga, that is, as a peasant cooperative union, is very widespread among
these people. Indeed, the old tradition of the family cooperative is
so much alive that the word zadruga has been adopted as the accepted
name for cooperative societies, while other nations had to invent
modern appellations for these organizations.”
In the new Kingdom, Serbia (which had won its independence from
Turkey in 1878) represented cooperative development of the longest
standing, its first cooperative association dating from 1894. By 1914
there were about 1,200 associations— including 800 credit, 200 dis
tributive (consumers,), 154 machinery, 40 livestock-insurance, and 8
wine associations— as well as a central bank formed by these organ
izations. The movement in Serbia was, even at that time, a united
one, most of the associations being affiliated to a central federation
formed in 1897.
In the other territories the cooperatives had developed largely
along religious and political lines. In Croatia, which had been ruled
by Hungary, the cooperative movement consisted of associations of
Croats, associations of Serbs, and associations encouraged and partly
financed by the Hungarian Government in an attempt to assimilate
and Magyarize the minority groups. The Serb and Croat associations
were largely led and controlled by priests of the Greek Catholic and
Roman Catholic Churches, respectively. As one of the main objec
tives of the nationality cooperatives was to maintain their national
individuality against the assimilating policies of the ruling govern
ment and serve as patriotic rallying points, naturally they were gener
ally looked upon with some distrust by their rulers. (Nevertheless,
the Government had used their facilities during the first World War
as distributing agencies for Government-controlled goods such as flour,
potatoes, paraffin oil, and coal.) Bosnia and Herzegovina also had
nationality cooperatives of Serbs and Croats. In Slovenia the asso
ciations were divided into clerical and anticlerical organizations.
9 S o u rces.—1The report on Rumania is based upon data from the following publications: Correspondance
Economique Roumaine (Rumania, Ministerul industriei si comentutui, Bucharest), January-March 1939,
January-March 1940, and July-September 1941; Review of International Cooperation (International
Cooperative Alliance, London), February 1932, September 1938, April 1939, July 1940, May 1941, November
1942, and July 1943; People’s Yearbooks (English Cooperative Wholesale Society, Manchester), 1929, 1930
1934, 1935, 1938, and 1941; Cooperative Information (International Labor Office), No. 8,1938; International
Directory of Cooperative Organizations (International Labor Office), 1939; The Cooperative Movement
in Jugoslavia, Rumania, and North Italy during and After the World War, by Diarmid Coffey (New York,
Carnegie Endowment for International Peace), 1922; La Cooperation dans les Pays Latins, by Charles Gide
(Paris, Association pour L’Enseignment de la Cooperation), 1928?; and New International Year Books.
1942 and 1943.
588544°— 44------ 18
266
Cooperatives in Individual Countries
During 1914-18 the whole of Serbia was occupied by enemy forces
and as a consequence the cooperative movement came to a complete
standstill during that time and had to be built up again when peace
came. Largely as a result of the work of one leader, M. Avramovitch,
the movement was started again and by 1920 there were about 800
associations of which 600 were old associations revived and 200 were
new.
In Croatia by the end of the war all of the associations promoted by
the Hungarian Government had disappeared. In that region the
cooperative credit associations were the predominating type remain
ing, although most of these associations also purchased supplies for
the members and sometimes marketed their produce as well.
In Slovenia where (being under Austrian rule) the cooperatives had
more opportunities for development, the associations were of more
varied type and more likely to carry on a single line of activity instead
of combining many functions in one organization. The Slovenian
movement also differed from that in the other regions in that it was
largely of the urban consumer rather than the agricultural type.
Montenegro had no cooperative movement, but in Bosnia and
Herzegovina (first under Turkish and then under Austro-Hungarian
rule) there were active cooperatives among the Christian inhabitants.
In each of the regions there was a central federation for each branch
of the cooperative movement, to which some or all'of the local co
operatives were affiliated. Although generally these federations
maintained friendly relations, each went its own separate way.
No data are available showing the number and membership of
various types of associations or even of the total Dumber in the new
Kingdom of Yugoslavia in 1920. It is known, however, that the
individual associations were very small. This was a deliberate policy
among the nationality cooperatives, the idea being that with a small
membership (among the Serbs 100 was regarded as the maximum
desirable number and the average was about 35) each member knew
all the others and could act to “ keep in line” any member who showed
signs of accepting Hungarian (Magyar) ideas or customs.
With the formation of Yugoslavia (Kingdom of the South Slavs)
at the termination of World War I, the aim of the cooperators changed
from that of the attainment of Slav independence to that of raising
the economic and cultural level of the people. The first step in the
task of welding the separate parts of the cooperative movement into
one organic whole began in 1919 when the regional federations formed
a super-union— the General Federation of Cooperative Unions in the
Kingdom of Yugoslavia. Three years later at the end of 1922, the
General Federation had in affiliation 27 of the 32 regional unions
and these included in their membership 96.8 percent of the total
number of cooperatives and 94.5 percent of all the cooperators in the
Kingdom.
T ypes o f Cooperatives and Their Activities
By the end of 1927 there were 4,265 cooperatives in Yugoslavia.
Credit associations formed over half of the total, and the cooperative
distributive associations were the next largest group. The coopera
tive movement had become much more varied than in the immediate
post-war period and included handicraft associations of various occu
pational groups, house-building associations, associations for rural
267
Yugoslavia
health and sanitation, electricity associations, fishermen’s associations,
and organizations for the production, processing, and marketing of
agricultural products, as well as cooperative communities. That the
Government recognized the importance of the cooperiative move
ment was indicated by cooperatives’ participation, through the General
Federations of Cooperative Unions, in the formulation of legislation.
In 1930 the Federation took part in the preparation of a legis
lative measure for the whole of Yugoslavia, to take the place of the
18 different laws under which cooperatives in the various regions
operated. Other measures in the preparation of which it assisted
were those dealing with chambers of agriculture, public and coopera
tive warehouses, and bills relating to various branches of trade.
Finally it collaborated with the Government and the exporters’
association in the formation (in June 1930) of the Chartered Company
for the Export of Agricultural Produce; 6 of the 18 members of this
company’s board of directors were representatives of agricultural
cooperatives.
Notwithstanding the depression beginning in 1929, the Yugoslav
cooperatives made steady progress from year to year. At the end of
1933 the total number of cooperatives in the country was about 8,400,
of which 6,647 were members of regional unions affiliated to the
General Federation of Cooperative Unions; they accounted for
890,150 individual cooperators (or 88.3 percent) of the total for the
country, 1,007,790. As each cooperative member represented an
average household of 5 persons, the cooperatives at that time were
serving about 34 percent of the total population of 14,500,000.
The credit cooperatives (about half of the total) which were very
evenly distributed throughout the country were, according to a
United States consular report, “ shaken more or less by the prevailing
crisis” but were endeavoring to strengthen and stabilize their organiza
tions. The retail associations were also affected by the fact that the
unfavorable agricultural situation had cut the purchasing power of
the farmers, who still formed the larger part of the membership.
The cooperative communities had grown to 536 in 1931 but had dedeclined to 470 by 1933. The agricultural production, processing,
and marketing associations on the other hand had grown by nearly 35
percent, and were playing an increasingly important part in the export
trade of Yugoslavia
The following statement shows the number of the various types of
cooperatives in 1927, 1931 and 1933:
im
N um ber of associations
1981
1988
All ty p e s ______________________________________
4, 265
7, 483
1 8, 227
C red it a ssocia tion s____________________________
D istrib u tiv e associa tion s_____________________
E lectricity associa tion s_______________________
H ou se-bu ild in g associa tion s__________________
R u ral health and sanitation association s____
H a n d icra ft associa tion s_______________________
F isherm en ’s a ssocia tion s______________________
C o o p e ra tiv e agricultural com m u n ities_______
A gricu ltural p rod u ction , processing, and
m a rk etin g associa tion s__________________ _
A gricu ltural service associa tion s_____________
O th er 3________________________________________
2, 459
1, 105
43
48
30
38
37
123
4, 407
1,217
51
89
84
93
43
536
4, 624
1, 566
(2)
88
88
116
58
470
216
37
129
697
60
206
1 Not including about 200 independent associations not affiliated with any regional union.
3Included with “other.”
2Includes regional unions and auditing unions.
936
00
281
268
Cooperatives in Individual Countries
RURAL HEALTH AND SANITATION ASSOCIATIONS
The cooperative associations for rural health and sanitation may be
considered as Yugoslavia’s outstanding contribution to the cooperative
movement. These associations, though not numerous, in the 20
years following their introduction made a significant contribution
toward improving rural conditions of living in Yugoslavia. However,
in order to evaluate their importance it is necessary to study them in
relation to general conditions in the rural areas.
Yugoslavia is primarily agricultural and even the industrial workers
are of peasant origin, never losing contact with their native villages
and always planning to return. Industrial workers formed, as late as
1936, only 10.7 percent of the gainfully employed population, whereas
agricultural workers accounted for 77 percent.
The agriculturists were in the main very small farmers, working
plots that were in many cases too small to support their owners even
at a bare subsistence level. The rural classes led a miserable existence,
as their living conditions were of the most stark and primitive type.
The death rate was appallingly high.
The Yugoslav Government eventually established a public health
service. At the time the Kingdom was established, however, there
were no public health facilities. Accident, sickness, and maternity
insurance were provided by an act of 1922, but the clinical and other
facilities were in urban areas and were not accessible to the peasants.
Of the 5,000 doctors in Yugoslavia, only 20 percent were in rural
areas— about 1 doctor for every 12,000 rural residents.
It was to assist in relieving these conditions and to raise the general
level of health and of living that some of the cooperative leaders 10
started the health and sanitation cooperative movement in 1921. As
the problem was largely one involving the education of the rural
families, it was believed that the approach should be through the
family rather than the school. Cooperatives were believed to be the
best form of organization, as they involved personal effort by the
members and it was desired to emphasize the idea of self-help.
The problems required an attack from three directions, i. e., curative
medicine, preventive and social medicine (including hygiene as well
as campaigns against social and infectious diseases), and rural sanita
tion work.
Curative medicine was the first branch of the work undertaken.
In the health cooperative the funds were provided by small regular
contributions from the member families, in order to insure a flow of
funds for the work. These contributions were usually paid by the
month but sometimes at the end of a crop season. Quarters were
rented and a doctor hired. The simplest type of health cooperative
had a doctor and sometimes a nurse or midwife, who were employees
of the association, and there were generally a consulting room, dis
pensary, one or two rooms for meetings and lectures, and sometimes a
room with bathtubs or showers. Beds for persons seriously ill were
also provided, in separate quarters.
As the associations grew they expanded their services and generally
built their own headquarters buildings which were known by the name
of “ health houses” — the symbol of the work the associations were try10
The idea had come to them through their participation in American relief work in the country after
the end of the war.
269
Yugoslavia
ing to do. The first such houses were built in 1928, and by 1934 there
were 14 of them.
Where there was more than one cooperative in the same village it
was the practice to have the headquarters of all in a single building
and this then was known as “ The Cooperative H ouse/’ Generally
in villages having health cooperatives the “ health house” was the
headquarters of all.
T h e size [of th e “ health h ou se” ] naturally depen ds on th e services th ey are t o
a c c o m m o d a te and th e sum it has been possible to p rov id e for b u ildin g them .
T h e y con ta in quarters fo r the d o c to r and his fam ily, a fu lly eq u ip p ed consultin g
ro o m , a w aitin g room , a dispensary and som etim es a la b ora tory , several sick
room s, in som e cases room s for nurses and attendants, room s fo r ou t-pa tien ts,
a lw a ys a show er ba th and usually baths. Som e o f th em h ave a p oly clin ic fo r
sch o o l children, a m atern ity w ard, a day nursery, etc. All, o f course, h ave on e
o r m ore room s fo r m eetings and lectures, equ ipp ed w ith teaching m aterial, and
o fte n a sm all library.
A lm ost all o f th em h ave vegetable gardens, pigsties, etc.,
w h ich can be used fo r voca tion a l edu ca tion . A t least one— a t B eljin a— has an
o p en -a ir sw im m ing b a th . T h e “ health houses” usually p rov id e a ccom m od a tion
also for the oth er co o p era tiv e societies o f the village (for credit, stock im p rov e
m en t, the-sale o f corn, e tc.).
T h e “ health h ou se” a t Lazarevats, on e o f the b iggest w hose sim ple an d dign i
fied architecture is qu ite im pressive, cost a m illion dinars to bu ild. T h e tota l
v a lu e o f the “ health h ouses” is n ow 3,240,863 d in a rs.11
Irrespective of their size, all of the health cooperatives took part in
the promotion of health, hygiene, and education.
The development of these associations was not spectacular but was
steady, as is indicated by the data in table 87. In 1922 the existing
associations federated into the Union of Rural Health and Sanitation
Cooperatives and this gave new impetus and stability to the
movement.
T a b l e 87. — Developm ent o f Rural Health and Sanitation Cooperatives in Yugoslavia in
Specified Years, 1922-39
Number of
associations
Number of members
Year
1922......................................................
1923....... .............................................
1925......................................................
1930.....................................................
1933.............................................. .
1938-39................................................
Total
Active
12
13
21
59
90
134
(2)
12
16
41
85
125
Families
5,286
5,049
8,386
16,647
43,847
65,586
Members
in family
Amount of
Number of business done
persons
(medicine sold,
treated
treatments,
etc.)
D in a rs J
(2)
30,249
50,316
99,882
(2)
(*)
18,518
14,568
14,179
34,445
58,577
136,187
(2)
119,949,000
370, 553,000
1,241,984.000
1,200,000,000
2,695,000.000
1For par values of currency, see Appendix table, p. 278.
8No data.
In the 11 years ending in 1933 the health cooperatives gave curative
treatment to 301,386 persons. This represented only one phase of
their work, however. In addition they carried on a great deal of
preventive work, such as vaccinations (given free to any person
applying), advice and supervision for mothers, lectures and preventive
work in connection with such diseases as malaria, tuberculosis, tra
choma, and the venereal diseases. Mothers of young children and
expectant mothers in the region were visited by the cooperative doctor
11 International Labor Review (Geneva), July 1935.
270
Cooperatives in Individual Countries
once a week, without charge, and the doctor also carried on medical
inspection in the village school. Five associations had established day
nurseries under the supervision of experienced persons.
Sanitation work of the most varied kind was carried on. In most
cases the actual work was done by the villagers, under the direction of
the cooperative. Among the activities so carried on were the laying
of water pipes and drains; construction of wells, manure pits, latrines,
and refuse pits; repair of poultry sheds, cattle barns, and dwellings;
and even paying a street or the village square.
As noted in a report to the International Labor Office 12 “ all these
various activities obviously reinforce each other and all of them are
also linked up with a many-sided, methodical, and steadily pursued
educational program. * * * They try to keep their educational
work in close touch with everyday life, and their system is first and
foremost concrete and active.” These two considerations led to the
formation of juvenile sections and women’s sections, with the view to
enlisting the active support and collaboration of the young people
and the women. By 1933 there were 33 juvenile sections, with 743
members from 12 to 18 years of age who were doing village-improve
ment work, making simple furniture, growing new kinds of food to
supplement the peasant diet, etc. “ From the moral and social points
of view they [these sections] give young people the habit of rendering
services to the community accordmg to their ability.” The women’s
sections provided instruction on general health questions, rearing of
children, gardening, poultry keeping, practical household questions,
etc.; and were “ responsible for organizing fetes and concerts and for
creating a real social life— a genuine feminist triumph, this, in the
Yugoslav village.”
In 1934 the associations organized veterinary sections with the
duties of care for sick animals prevention of animal disease/ improve
ment of breeds, provision of serums, etc. The activities of one large
veterinary association covered 37 villages.
In 1938 the Union of Rural Health and Sanitation Cooperatives
organized a traveling dental clinic which visited all the health centers.
D IST R IB U T IV E CO O PER ATIVES
As so very large a proportion of the population (not excepting the
industrial workers) consisted of peasants, even the consumers’ dis
tributive cooperatives of Yugoslavia were very largely rural. How
ever, most of the central federations in all branches of cooperation
had their headquarters in the larger towns and cities and there was
thus a certain consumers’ cooperative development in the urban cen
ters. Also important in the consumers’ cooperative branch of the
movement were the associations of the railway workers and persons
employed by the Government.
As used in Yugoslavia, the term “ civil servants” included not only
employees in Government administrative offices, but also soldiers,
teachers, railway workers, miners, employees in Government-owned
salt and sugar factories, and persons on Government pensions. At the
end of 1938 there were 322 societies of “ civil servants” of which con
sumers’ cooperatives accounted for 130, and credit associations for
167; the remainder consisted of 15 building associations, 9 productive
organizations, and 1 insurance association. The total membership,
13 International Labor Review, July 1935, p. 31.
Yugoslavia
271
163,056, included 88,173 Government employees, 42,436 workers in
other public employment, 7,519 soldiers, and 23,855 pensioners. The
associations were members of the Union of Civil Servants Coopera
tives, an all-embracing federation with wholesale, propaganda, pro
ductive, credit, and insurance departments. Its productive depart
ments operated flour mills and a bakery, which in 1937 produced goods
valued at 20,091,000 dinars. The Union used its surplus to purchase
and run hotels and vacation homes for the use of its members.
One of the largest local associations in the country, and probably
the largest retail consum ed cooperative, was the Railwaymen's Dis
tributive Cooperative Association. T.his association, whose member
ship exceeded 7,900, had its headquarters at Ljubljana (in Slovenia).
As its membership was restricted to railway workers and practically
all of them were members by 1935, its efforts were directed mainly
toward expansion of its services. It operated grocery stores, 2 meat
markets (the pork products for which were made in its own plants),
a milk-distributing system, a refreshment bar, and a restaurant. In
addition to food, the association also handled household equipment,
shoes, and dry goods, carried on ready-made and custom tailoring
business, and manufactured underwear. Its business in 1933 amounted
to 46,300,000 dinars. As its members were scattered to all points of
the railway system, it had built up a mail-order business on a large
scale, its bills being settled automatically by deductions from the
members' wages. As many of the railway workers were also small
producers of farm products, honey, etc., the association bought their
surplus products. It also did considerable cultural and welfare work.
The railwaymen also had their own cooperative credit association,
most of the loans of which were made for the construction of dwellings.
Recreational and Cultural Aspects o f Cooperatives
The cooperatives in Yugoslavia did not stop with purely economic
measures. One report to the International Labor Office noted that
generally Yugoslav cooperative associations “ however small," strove
to meet the cultural requirements of their members.
As already noted, the “ health houses" all were social and educational
centers for the areas in which they were found. One of the workers'
productive cooperatives had a library and reading room in the “ Coop
erative House" which it and the local consumers' cooperative had
established together; this house also contained a lecture and recreation
hall.
The Railwaymen's Cooperative Association, already described, in
1934 purchased a tract of 50,000 square meters of mountain land with
a view to starting a cooperative vacation resort.
One of the large credit cooperatives made a practice of using half
of its annual earnings for various educational and social purposes.
In this way the association became the owner of several nurseries for
which it paid 400,000 dinars and which could accommodate 150 chil
dren at a time; these nurseries were run, not by the association itself
but by the Central Organization for Workers' Education.
Cooperatives in the Decade P rior to the N azi Invasion
The year 1932 was the worst year of the depression in Yugoslavia
and led to a number of measures by the Yugoslav Government de
272
Cooperatives in Individual Countries
signed to improve the agricultural and currency situation. In Novem
ber 1933 a moratorium was declared on agricultural debts, which,
although it relieved borrowers, virtually crippled the agricultural credit
cooperatives. As a result of their protests, the Government in August
1934 exempted those associations which accepted savings deposits,
but this arbitrary division into protected and unprotected associations
created certain other difficulties. In the same year the cooperative
representation on the export association was cut by two-thirds. The
International Cooperative Alliance noted that “ in the legal and fiscal
sphere the movement’s position also changed for the worse during
1934,” causing the movement to petition for a change in the law, to
remove the cooperatives from control by associations of private
dealers. Private traders were allowed to borrow from the National
Bank, at 5 percent interest; this privilege however, was denied to the
cooperative wholesale. During 1934 the agricultural cooperatives also
suffered a reduction in their export business, largely as a result of the
unfavorable prices on the European markets and the devaluation of
the currency in Czechoslovakia (one of their chief markets).
PASSAGE OF THE COOPERATIVE LAW
In 1937 the cooperative measure, introduced in 1930, finally became
a law. It replaced 18 acts and orders which had been in force in
various parts of the country and introduced the first uniform legal
definition of a cooperative association and the first uniform regulations
for the movement. However, the act stipulated that cooperative
associations could do business only with members, thus eliminating
one very fruitful source of members— persons who through their
patronage of the associations became acquainted with cooperative
policies and eventually joined. The act also provided that every local
association must be affiliated to one of the auditing unions. Supervi
sion of agricultural cooperatives and their federations was delegated to
the Minister of Agriculture, and supervision of consumers’ coopera
tives, craft cooperatives, and associations of private traders to the
Minister of Trade and Industry. Cooperatives of public employees
were to be under the supervision of the Minister of Finance. These
three officials were empowered to send representatives to meetings of
the federations in that branch of the movement which they supervised.
On the other hand, auditors of the cooperative auditing unions had
the privilege of free travel on Government railroads; and a fund for
promotion of cooperation was provided for, financed by 2 percent of
the net surplus of two Government banks and 10 percent of the net
surplus of the State lottery (these were estimated to aggregate
4,000,000 dinars per year).
DEVELOPMENT OF COOPERATIVES, BY TYPE
By the end of 1938 the cooperative membership in Yugoslavia stood
at 1,414,876; thus (counting their families, but allowing for some
duplication of members) about 40 percent of the total population was
served in one way or another by cooperatives. The 10,832 coopera
tives to which the cooperators belonged were all affiliated (as required
by the 1937 law) to the General Federation of Cooperative Unions at
273
Yugoslavia
Belgrade, through their regional unions. Table 88 shows the develop
ments of the Federation up to the end of 1938.
T a b l e 88.— Total N um ber o f Cooperatives in Yugoslavia and N um ber and M em bership
o f A ffiliates o f General fed era tion o f Cooperative U nions, 1927—38
[For par values of currency, see Appendix table, p. 278]
Total number of
coopera
tives
Year
19**>7
.
_
_ . . . ___ __ _ .... ___________ _______ ___ _
.......... _
___ —. ______
_______
.
.
_____________
_____________________
...
1933
1934
law
193a
1937
1938
Associations affiliated to General
Federation of Cooperative Unions
Their
member
ship
Number
Their
business
D in a rs
4,265
7,077
‘ 8,227
‘ 8,526
(*)
(2)
10,144
10,832
3,049
5,796
6,647
6,952
7,254
7,610
10,144
10,832
458,162
784,011
* 890,150
876,342
918,114
8 1,000,000
1,329,015
1,414,876
717,033,000
1,234, 368,000
(2)
(2)
(2)
(2)
(2)
(2)
i Not including: about 200 independent associations not affiliated with any union; total members all
types in 1933,1,007.790.
* No data.
8Approximate.
Most of the regional unions carried on commercial activities, as
well as the auditmg activities required by the law. In 1938 the
commercial departments of these central unions had a total business
aggregating 458,400,000 dinars, of which 115,200,000 dinars repre
sented the purchase of supplies and 343,200,000 dinars represented the
marketing of the members' products. The size of 16 of the central
unions for which data are available is indicated in table 89.
T a b l e 89 .— M em bership and B usiness o f Specified Central Federations in Yugoslavia ,
(For par values of currency, see Appendix table, p. 278]
Central federation
Serbia;
General Federation of Serbian Rural Cooperatives___
General Union of Craftsmen’s Cooperatives ............. .
Union of Public Officials’ Consumers’ Cooperatives...
Slovenia:
Cooperative Union of Ljubljana.......... .................. ........
Union of Slovenia Cooperatives in Ljubljana3........ .
Union of Cooperatives in Yugoslavia3.......................... .
Bosn ia-Herzegov ina:
Union of Croatian Agricultural Cooperatives.............. .
Union of Serbian Agricultural Cooperatives_________
Dalmatia:
Union of Cooperatives in Split........................................ .
Cooperative Union of Split.............................................. .
Union of Fishermen’s Cooperatives............................... .
Croatia:
Croatian Central Agricultural Cooperative..................
Central Union of Croatian Agricultural Cooperatives.
The Cooperative Union.. ............. .................................
Central Union of Rural Credit Cooperatives8............. .
Slavonia:
Union of Agricultural Communities...............................
Number
of affil
Their
Business
iated
member
done by
ship
associa
federations
tions
D ina rs
3,316
159
304
225,000
8,334
153,427
‘ 6,229,000
703
381
102
140,617
91,197
18,102
2 21,107,000
141,400,000
548,000
69
172
5,894
12,615
2,089,000
200
267
60
18,188
23,880
2,126
182
422
230
1,484
13,280
60,294
58,468
105,283
2,382,000
6,602,000
78
6,600
4,086,000
83,647,000
*13,000
1 Data are for 1935; in addition the wholesale belonging to the union had a business amounting to 57,846,000
dinars in 1937.
* Business of union’s supply and marketing associations, 1936.
*Data are for 1936.
*Data are for 1935.
274
Cooperatives in Individual Countries
The credit cooperatives still formed the largest single group of
cooperative associations. In 1937 their own funds and the savings
deposited with them accounted for about a third of the total banking
resources of the country. The agricultural cooperatives were still
strong, also. In the 1938-39 season 28 percent of all the wheat
exported from Yugoslavia was supplied by the cooperatives, as well
as 40 percent of the cattle and poultry exports.
Consumers' cooperatives.— The consumers' cooperatives represented
erhaps the fastest-growing type of association in the 1933-38 period,
aving increased from 1,566 at the end of 1933 to 2,259 in 1938.
Most of the rural consumers' cooperatives were affiliated to the
General Union of Serbian Rural Cooperatives at Belgrade. This
association had its own wholesale association formed in 1929, with an
initial membership of 130 associations, but the difficulties of transport
confined the wholesale's services largely to the associations in the
areas where the union had branch wholesale warehouses. Up to
1935 the union and wholesale both accepted agricultural cooperatives
as members; by agreement, in that year, the wholesale association
thereafter accepted as new members only consumers' cooperatives,
the central organizations of agricultural cooperatives, and cooperative
unions.
The wholesale made a modest start in the field of production and
by the end of 1935 had a factory making candy and confectionery, a
cheese factory, a plant making lubricating oil, and a factory producing
salt, shoe polish, etc.
The development of the General Union of Serbian Rural Coopera
tives from 1928 to 1938 is shown in table 90.
E
T a b l e 9 0 . — Developm ent o f M em bers o f General Union o f Rural Cooperatives in Y ugo
slavia and its W holesale for Specified Years9 1928-38
[For par values of currency, see Appendix table, p. 278]
General Union
Year
Wholesale association
Number
Number
of affil
Their pur
of affil
Their
Wholesale's
iated
chasing
and
iated
business
associa members sale business1 associa
tions
tions
D in a rs
1928 ur_________
- _ _
__________
1931............................................................................
1932.............................................................................
1934............................................................................
1935.............................................................................
1936............................................................................
1937.............................................................................
1938................- ...........................................................
(2)
2,286
2,509
(2)
2,979
3,172
3,316
(2)
78,350
118,290
220,200
(2)
(2)
225,000
225,000
243,670
(2)
(2)
(2)
230,479,282
257,155,804
220,426,000
8
D in a rs
3 130
(2)
(2)
991
(2)
1,236
(2)
(2)
31,731,177
37,166,955
(2)
57,846,000
(2)
» Not including loans of credit associations.
3No data.
*1929.
Rural health and sanitation cooperatives —During 1933-38 the
number of active health associations had risen only from 85 to 125.
Their growth depended on the slow, laborious process of education
and they therefore had not by any means achieved their ambition of
stamping out tuberculosis, malaria, etc. However, limited as their
development had been, in relation to the size of the task confronting
Yugoslavia
275
them, they had made a noteworthy contribution in raising the level
of health and sanitation in rural areas. A report to the International
Cooperative Alliance noted that they had played “ a remarkable part
in the unwavering toil for economic and cultural progress and for
raising the standard of national health, and their cultural importance
would no doubt have finally equaled their economic power had not
the Nazi attack on Yugoslavia interrupted their evolution.”
Cooperation Under the N azis
On April 6, 1941, Germany attacked Yugoslavia and Greece without
warning or declaration of war. Twelve days later the Yugoslav
Government capitulated to the Germans.
By the end of the year the Yugoslav cooperative movement was
in ruins, partly as a result of the partition of the country and partly
as the result of specific acts of the Germans against the movement.
The cooperative movement and the centred federation had grown
up largely on a Provincial basis. In the partition of Yugoslavia that
followed the German invasion the Provinces were not preserved as
units. Slovenia was divided among Germany, Italy, and Hungary;
Serbia was divided among these countries and Bulgaria; and parts of
Croatia were annexed by Italy and Hungary, and the remainder was
made a puppet State, parts of which were occupied by Italy. Thus
the retail associations were cut off not only from the General Federa
tion at Belgrade but also in many cases from their own regional unions.
In Slovenia the Germans completely destroyed the cooperatives
in that territory which they annexed, confiscating their property and
the members’ savings deposits (about a billion dinars), and arresting
or deporting the officials. In the part of Slovenia taken by Italy
most of the cooperative property and warehouses were looted, “ but
the storehouse of the Itailwaymen’s Cooperative Association escaped
by an inconceivable chance.” In Serbia, the cooperatives of the
German minority (“ which had been strongly assisted by Nazi Germany
prior to the occupation” ) were favored in many ways. Thus they
were given a monopoly of the very important hemp trade throughout
Serbia. The rest o the Serbian cooperatives were turned over to a
former cooperator (Lyotitch, by name) who had gone over to the
Nazis even before the invasion, and he began to take measures to
“ Nazify” them. In Croatia, Nazi “ commissioners” were installed in
all the cooperatives. Kegarding Croatia, which was formerly a rich
agricultural region, one account (some time after the invasion) noted
significantly that “ Croatia which formerly produced an agricultural
surplus, is now obliged to import grain and fats.”
Apparently, however, the conquerors had to recognize the value of
the cooperatives and even worked to use their services and extend
their operations. Thus, at the beginning of 1944, more than 2% years
after the invasion, high Government officials in Croatia were aiding in
the formation of a central agricultural cooperative in Baranja which
would collect all the produce of the members and “ supply all their
agricultural and domestic needs.” A site for the building of the new
association was to be given by the city prefect of Osijek. In Dalmatia
it was announced at the beginning of 1944 that “ special importance”
276
Cooperatives in Individual Countries
was expected to be bestowed upon the cooperatives, of which there
were at that time 144 credit, 172 consumers’ , and 137 productive
associations.
In Serbia, in M ay 1943 the officers of all the central cooperative
organizations were removed at one stroke by the puppet Government
of General Nedi6, on the ground that they had proved to be “ unre
liable elements” in the adjustment of the cooperatives to the “ new
peasant cooperative State.” Avramovitch, aged pioneer of Serbian
cooperation, was recalled from retirement to head the General Federa
tion of Cooperative Unions. Some time later, the Minister of Agri
culture and Supply announced that a questionnaire had been sent to
all the cooperatives for their vote on a proposed “ reorganization of
the entire Serb cooperative system.” The result of the circulariza
tion, he said, was an overwhelming vote in favor of the organization
of a “ customers’ purchasing association” for farmers and of a coopera
tive for popular education, in every commune, both of which all
farmers would be required to join; formation of a single federation
(Serb Cooperative Alliance for all of Serbia); establishment of a
cooperative providing old-age pensions and sickness and accident
insurance for farmers; transfer of the State hail and flood insurance
to cooperative management; and formation of livestock-insurance and
farm-machinery cooperatives. The vote also favored the organization
of a health cooperative 13 for every 4,000 rural residents, “ with com
pulsory membership.” Shortly afterwards, an order to this effect
was issued. Early in 1944 cooperatives were made the sole source of
supply of rationed and controlled articles for rural residents.14*
Cooperative Movement in Albania
Almost no data are available concerning Albania. The Interna
tional Labor Office reported in 1933,16 the formation of the “ first
cooperative society in Albania.” Although not specifically identified
as an agricultural association, evidently this was the case, for it led
the Government to promulgate a law formulating standards and
conditions governing the making of grants or advances to agricultural
cooperatives. Search of cooperative and other literature reveals no
further data regarding the above association or any others in Albania
between that time and the invasion of the country by the Italians on
April 7, 1939.
i* In th e second h a lf o f 1942 there w ere in Serbia 228 health associations w ith 32,426 m em b ers (a b o u t h a lf
o f th e pre-w ar m em bership total for the w h ole o f Y u g o s la v ia ).
14 S o u r c e s .— T h e report on Y u goslavia is based u p o n data from the follow in g p u b lica tion s: A nnuaire
sta tistiqu e du R o y a u m e d e Y u goslavie, 1933 (B elgrade, S tatistiqu e g6n£rale d ’ E ta t, 1935); R e v ie w o f Inter
national C oop era tion (International C oop era tive A lliance, L o n d o n ), issues o f January 1935, M arch and A pril
1936 A u gu st 1939, and M a y and D e ce m b e r 1941; P eop le’s Y e a rb o o k s (E nglish C oop era tive W holesale,
M a n ch ester, E n gla n d ), 1933 through 1942; International L a b or R e v ie w (international L a b o r O ffice), J u ly
1935; International D irectory o f C oop era tiv e Organizations (International L a b o r O ffice), 1939; C ooperative
Inform ation (International L a b or O ffice), N o s. 12 and 50, 1929. N o . 10,1931, N o . 13, 1932, N o . 4,1933, N o . 4,
1934, N os. 2, 3, and 6,1935, N o . 7, 1936, N o . 1,1938, and N o . 1,1940; C oop era tiv e M o v e m e n t in Jugoslavia,
R u m a n ia and N o rth Italy D u rin g and A fter the W o rld W ar, b y D ia rm id C o ffe y (N e w Y o r k , C arnegie
E n d o w m e n t for International Peace, 1922); C onsular reports, A u gu st 14, 1925, an d M a rc h 7,1935; and N e w s
D ig est (L o n d o n ), issues o f F ebruary 8 and 9, 1944.
w C oop era tiv e Inform ation , N o . 9,1933.
A ppendix— Par Values o f National Currencies
The accompanying table gives, for each of the countries of Europe, the par
value of its basic unit of currency and the dates on which new values became
effective.
P ar Values o f Currency o f European Countries, Through A p ril 1940
[D ata are from Federal R eserve B u lletin , Septem ber 1940, p p . 928-934]
C ou n try
Unit
A lb a n ia ___________
F ran c..........
A u stria....................
K ro n e
Franc_____
B e lg a ..........
Franc..........
B ulgaria..................
Lev
C z e c h o s lo v a k ia ...
K o r u n a .. .
D en m a rk .................
E stonia___________
F rance____ ______ _
1925.........
2 /1 9 3 4 ...
$0.1930
.3267
.2026
.1407
.2382
.1875
.1887
.1883
.1930
.1390
t.0471
‘ .0353
‘ .0339
.1930
.0072
I t a l y ___
.0122
N orw a y
1925..........
2 /1 9 3 4 ...
4 /1 9 3 4 ...
1 2/1935 ..
1 2 /1936 ..
1926_____
2 /1 9 3 4 ...
3 /1 9 3 5 ...
4 /1 9 3 6 ...
_
1927..........
2 /1 9 3 4 ...
1931..........
2/1934___
10 /1 9 3 6 ..
K ro n e
E . m a r k ..
K roon .........
F in la n d ........ ...........
Par
value
_
S c h illin g ..
B elg iu m ...................
D ate
effective
M ark ka-
2 /1 9 3 4 ...
1921..........
1924..........
1928..........
2 /1 9 3 4 ...
3 /1 9 3 9 ...
1913_____
12 /1 9 2 5 ..
2 /1 9 3 4 ...
1 2 /1 9 3 8 ..
G r e e b e __
I c e la n d ..
L a t v i a ______ _
.
M a r k ..........
Reichs
m ark.
D rachm a.
1924..........
2 /1 9 3 4 .-.
K rone_____
K oron a___
P engo.........
K ro n e _____
D a te .
effective
.
Let
L it h u a n ia
Lit
N e th e r la n d s
F lo r in .
1927..........
2 /1 9 3 4 ...
10/1936 ._
1913..........
2 / 1 9 3 4 ...
1 0 /1 9 3 6 ..
1 /1 9 3 7 ...
1938..........
1 /1 9 4 0 ...
1922.........
2 / 1 9 3 4 ...
2 / 1 9 3 4 ...
4 /1 9 4 0 . . .
K r o n e ___
2 /1 9 3 4 ...
P o la n d
____
Mark____
Zloty_____
_
P ortu g a l _
...
Escudo
R u m a n ia .
..
L e n _____
1924..........
1927..........
2 /1 9 3 4 ...
7 /1 9 3 1 ...
2 / 1 9 3 4 ...
Soviet Union........
R u b l e _____
Ch e r von e tz .
S p a in
______
.0496
.0435
.0279
S w eden.
. 2^82
S w it z e r la n d
2 / 1 9 2 9 ...
2 / 1 9 3 4 ...
1 1 /1 9 3 6 ..
1913..........
1917..........
1 9 2 2 .....
2 / 1 9 3 4 ...
9 /1 9 3 5 ...
Peseta___
2 / 1 9 3 4 ...
Krona.
2 / 1 9 3 4 ...
_
Franc
.3382
^ 1 9 3 4 ...
9 /1 9 3 6 . . .
United Kingdom. Pound___
5/1928—
2/1934—
H u n ga ry..
L ira
Franc_____
6 /1 9 2 8 ...
2 /1 9 3 4 ...
1 0 /1 9 3 6 ..
7 /1 9 3 7 ...
1 1 /1 9 3 8 ..
3 /1 9 4 0 ...
G erm any.
.0296
.0418
.0351
.2680
.4537
.0024
.0027
.2680
.4537
.3153
. 1930
.0252
.0426
Unit
C o u n try
1924..........
1925.........
2 /1 9 3 4 ...
1 /1 9 3 9 ...
1944..........
.0130
2 /1 9 3 4 ...
3 /1 9 3 9 . . .
5 / 1 9 3 9 ...
6 / 1 9 3 9 ...
8 /1 9 3 9 . . .
9 /1 9 3 9 . . .
<*)
.2026
.2026
.1749
.2961
.1974
.2680
Y u g o s la v ia .
_
D in a r
6 /1 9 3 1 . . .
2 / 1 9 3 4 ...
i O ne-fifth o f belga; belga (5 francs) used o n ly in foreign exchange.
8 N o t available.
277
Par
value
$0.1930
.0526
.0891
.0526
.1930
.3267
.1974
.1960
.1990
.1951
.10 0 0
.1693
.4034
.6830
.5601
.2680
.4537
.2382
.1930
.1122
.1899
1.0805
.0422
.0748
.1930
.0060
.0101
.0073
.5146
0)
5.1460
8.7123
(»)
.1930
.3267
.2680
:4537
.1938
.3281
.2426
4.8665
8.2397
4.7138
4.7165
4.7138
4.4164
4.1667
.1930
.0176
.0298
Index
P ag®
A g r i c u l t u r a l cooperatives.................................................................................................................................................
6-9.
16, 20, 35, 46, 47, 58, 61-63, 74, 75, 98,100,103,104,110, 111, 113,117,120,130,132,135, 147-149, 152,
154, 155, 158, 159, 161-164, 166-168, 170, 173, 174, 177, 178, 180, 181, 184, 188, 190, 198-197, 202, 203r
208, 209, 217-219, 221-223, 229-231, 235-241, 243-248, 251-255, 262-265, 267, 268, 274, 276, 277
A lban ia, cooperatives i n ......................................................................................................................................................
277
A llian ce, International C ooperative............................................................................ 2,32-37,205, 216,225,226,255,264
A m a lga m a tion of cooperatives...................................—................................................. 52, 64, 68, 73, 77, 78, 83, 84, 139,
154,158,159,166,171,185,193,203,207,218,222,226,263
A u d itin g , central co o p e ra tive ......................................... 68,81,82,95,131,143,152,164,180,183,190,214,217,218,273
A ustria, cooperatives in ............................................................................... 6,8,12,17-24,26-28,30-34,38-40,42,167-176
B a k e r ie s .......................................... 16,17,64,71,73,100,104, 111, 124,129,145,164,171,180,222,225,229,235,244,261
B altic countries, cooperatives in {see a lso E stonia, Latvia, L ith u a n ia )............................................................. 31,43
B an k in g activities, cooperative {see also C redit cooperatives; P eop le’ s b a n k s ).................................. 52, 67, 68,
74,79,81,101,114,131,138,150,162,180,182,190,230,244,256,258,265
B an k in g D ep artm en t, C . W . S. (G reat B rita in )......................................................................................................
52
B elgium , cooperatives in .......................................................... 6,8,10-12,14-20,23-26,28,31,33,34,36,38-40,42,60-73
B u ildin g associations {see H ousing, cooperative).
B ulgaria, cooperatives in ................................................ 6,8,11,12,14,16-18,20,22-29,32-34,36,33-40,42,43,243-251
Business, cooperative, statistics o f.............................................................................................................. ......... ..........
14,
23-25, 35, 37, 38, 46, 47, 49, 50, 52, 54, 58, 59, 62, 63, 65, 70, 78,80, 85, 86, 94, 96, 101, 103, 105, 106,
111, 113-116, 122, 124, 125, 127, 130, 132, 136, 138, 140-142, 145-147, 152, 155, 156, 159, 160, 163, 165,
172, 175, 179, 187, 200, 206, 212, 215, 218, 226, 232, 234-237, 239, 241, 250, 258, 270, 273-275:
B usiness, p rivate, and cooperatives {see P riv ate business and cooperatives).
C a p it a liz a t io n o f coop era tives.......................................................................................................................................
52,
58, 59,68,69,70,80,103,106,107,115,121,122,124-126,136,140,141,144,146,156,158,159,162-165,
173, 211, 236, 241, 249, 255.
C entralization in cooperative m ove m e n t........................................................................ 68,81,82,214,256,257,273,276
C hildren, cooperative care o f ._____________ ________ _____ _________________ 10,11,66,78,85,181,201,202,269,272
Congresses, International C o op era tiv e............. ................... ......... ...............................................................................
36
C onsum ers’ coop e ra tive s ,.............. ............ ................................................................................................... .................
6-9,
16-32, 35, 46-57, 59, 60, 62-72, 74-84, 91-100, 103-111, 114-118, 120-135, 138-145, 147, 149-166, 168,
178, 180-196, 198-207, 209, 210, 217-226, 228, 229, 232-241, 243-245, 247, 249-253, 256, 258, 259, 262266,268,271,273-276.
C red it cooperatives {see also P eople’ s b a n k s).......................................................................................................... 1,6-9,
35, 46, 58, 62, 74, 98, 100, 101, 111, 119, 120, 128, 135, 136, 149, 150, 155, 159-163, 168-170, 173, 177182, 188, 190, 194-197, 202, 209. 217, 218, 229, 230, 237-241, 243-245, 247, 249, 252, 253, 257, 258, 262,
263,265-268,271,272,274,276.
C zechoslavakia, cooperatives in ................................................ 6,8,10-12,14-21,23-28,30,33,34,36,38-40,42,177-194
D e n m a r k , cooperatives in _ _ ............................................ 6,8,10,12,14,16,17,19,23-28,31,33,34,36-38,40,110-117
Depressions, cooperatives in ....................................................... ...................... 18-22,67-70,81,95,96,114,115,123,131,
147,151,154,156,157,163,171,173-175,185,186,195,198,199,210,214,219,262,267,272
D is tr ib u tiv e cooperatives {see C onsum ers’ , also R etail cooperatives).
D rugs, cooperative p rovision o f . . .................................................................... ..................... 10,49,61,62,71,220,229,240
E a r n i n g s of coop era tives....... ................... ....................................................................................... 50,90,96,105,106,115,
116,124,125,127,140,147,154,156,158,160,163,165,187,200,201,212,214,215,236
E d u ca tio n and training, coop era tive................................................ 35,76,97,152,175,217,246,255,256,269,270,276
E ire {see Ireland).
E lectricity associations— —....................................................................................................................... 16,46,74,100,102,
111-113,120,135,136,149,150,168,177,178,180,181,190,198,203,236,240,241,244,267,268
E nglish and Scottish Joint C ooperative W holesale S o cie ty ..................................................................................54,55
E nglish C ooperative W holesale S o cie ty ........................................................................................................................51,58
E ston ia, cooperatives in ................................................ 6,8,14,16-18,20,21,23-29,31,33,34,36,38-40,42,43,148-154
F a m ilis t £ r e , L a (w orkers’ p rod u ctiv e at Guise, F ra n ce)____________________________________ __________ 86,87
F a m ily allow ances paid b y c o o p e ra tiv e s ....................................................................................................... 72,74,86,218
F arm ing b y consum ers’ cooperatives................................................................................................... 49,107.124,152,201
F ederation s, national and regional.................................................................................................................................. 2,51,
76, 78-82, 84-86, 94, 98-101, 103-109, 111-114, 116-121, 125, 130, 135-137, 150, 154-156, 161, 163,
168, 169, 175, 177-182, 184, 187, 190,191,193, 196-203, 208-218, 220, 223, 224, 228, 230. 231, 233-235,
238, 240-244, 248-250, 252, 253. 256, 257. 263-267, 269, 271-276.
F in lan d, cooperatives in ........................................................................ 6,8,12,16,17,19,23-28,32,34,36-40,42,118-128
F ish erm en’s associations.....................................................................................................................................................
16,
46, 111, 130,147,149,152,155,156,223,227,229,232,236,237,240,252,253,261,267,268,274
‘ F orestry associations................................................................................................................... 16,120,223,243,247,260,268
F rance, cooperatives in ....................................................... 6,8,10,11,13-21,23,24,26-29,31,33,34,36,38-40,42,73-84
G e o g r a p h i c a l d istribu tion o f cooperatives............................................................................... 6-9,51,190,232,235,258
G erm a n y , cooperatives in ........................................................................... 7,8,11-13,17,18,20,22-29,31-33,38,195-207
G ov ern m en t, cooperatives and the........................................................................................................................
57,
67, 74, 75, 82-85, 93, 95, 97, 98, 100, 101, 105, 108,112, 115, 117,118, 122, 127,128, 132,133, 136, 137,
143, 144, 146, 148, 149-160,162,165,167,169-171, 174, 175,177, 178,180, 184, 185, 188,189,199, 203,
204, 206, 208, 209, 212-217, 222, 224-228, 230-234, 238-240, 242, 243, 246, 251, 255, 260, 261, 264, 266,
267, 272, 273, 276.
G reat B ritain, cooperatives in_______________________________________ 7,8,12-18,23-29,33,34,36,38-40,42,45-60
G reece, cooperatives in ____________________________________________________________ 7,8,12,13,15,16,25,251-254
H e a l t h insurance..................................................................
H e a lth w ork, cooperative {see also M ed ica l care)
...................................................................................................... ..
.........................................................
5 2 ,5 8
- ,
10 12
111, 1 8 9 ,2 1 7 ,2 2 0 ,2 4 0 ,2 4 1 ,2 4 3 ,2 4 5 ,2 4 7 ,2 4 9 ,2 6 7 -2 7 1 ,2 7 5 ,2 7 6
H o lla n d {see N etherlan ds).
278
Index
279
Page
H ou sin g, cooperative.............................................................................................. „ ..........................................................
6-9,
12-14, 46, 62, 66, 74,101,102, 111, 112, 120, 121, 130, 136-138, 145, 149, 161, 168, 169, 172, 173, 177,
178, 181,182,188, 190, 191, 196, 197, 202, 209, 213, 217, 218, 220, 222, 229, 237, 239-241, 245-247, 252,
253,267,268,271.
H u n ga ry, cooperatives in ________________________________________________ 7,8,11-18,22-30,32-34,36,38,207-216
I c e l a n d , cooperatives in ..................................................................................................... 7,8,23,24,27,28,30,34,145-147
Im p or ts and exports b y cooperative w holesales................................................................................ ............. .........
80,
106,142,143,145,151,157,164,165,172,180,201,213,214,249, 272
Im ports a n d exports, cooperative im portance in .......... ................. ...........................................- ............... .............
29,
30,110,145,148,149,151,152,157,164,165,214,217,267,274
Industrial cooperatives (see W orkers’ p ro d u ctiv e and labor associations).
Insurance C om m ittee o f International C ooperative A lliance............. ........... ................... .................................
36
Insurance, coop era tive_____ 35, 36, 46, 48, 55, 62, 66-68, 74, 98, 101, 111, 114, 120, 126, 131, 135, 138, 147, 149,
150,155,159,161,168,177,182,184,186,209,229,236,237,243,245,247,252,253,261,265,271,276
Ireland, cooperatives in ........................ ............................................................................ 7,8,23,24,38,40,42,48,55,57-60
Irish A gricultural O rganization S o cie ty ....................................................................................................................... 57,58
Irish A gricultural W holesale S o cie ty...................... ......................................................................................................
55
Irish Free State (see Ireland).
Intercooperative relationships an d a ctio n ____ 35,36,43,61,69,80,82,93,104,107,117,132,135,138,144,154,158,
161-163,165,173,177,182,184-186,208,217,243,250,266,272,274
Ita ly , cooperatives in .......... ..................................... ............................................... 7,8,12,14-16,20,21,23,24,34,227-238
L a b o r ban ks ....................................................................... ...................................................................... 67,167,171,172,174
L a b or cooperatives (see W ork ers’ p ro d u ctiv e an d labor associations).
L a b or organizations, cooperatives a n d .......... 61,63,67,69,73,114,116,121,170-172,182,186,199,200,202,210,226
L a n d leasing an d/or cu ltiva tio n (see also A gricu ltu ral cooperatives) .............. ................................................
16,
46,180,208,231,243,244,248,253,259-263
L a tv ia , cooperatives in ........................................................................... 7,8,16,20,21,23-26,28,33,34,36,38,43,154-160
L a w s, and legal basis of cooperation ....................................... ................. ................ ..................................................
60,
63, 69, 73, 82, 84, 85, 94, 105, 108, 110, 112, 114, 119, 128, 132, 149, 153, 157-159, 167, 169, 172, 174,
184, 188, 190, 195, 204, 205, 209, 214, 216, 217, 219, 220, 224, 225, 235, 238, 239, 241, 242, 244, 246,
247, 249,251-254,256,257,260,261,263,264,267,272,273.
L in es handled b y cooperatives.............................................................. ........................... 16,17,49,71,73,79,104.123,181
L ithuania, cooperatives in .............................................................. 7,8,17,18,21,23-26,28,30,31,33,34,38,43,160-166
L u x em b u rg, cooperatives in ................................................................................................................................ 7,8,24,25,99
M a n a g e m e n t o f unsuccessful local cooperatives, p rov ision fo r......................................................... 53,71,143,152
M ed ica l care, coop erative........................................................................ 10,66,78,79, 111, 113,213,220,243,247,249,269
M em b ersh ip , cooperative, statistics o f_ _ ..................................................................................................................... 8-10,
14, 25, 35, 46, 50, 52, 54, 58, 59, 62, 63, 65, 70, 78, 85, 86, 94, 96, 101,103,105, 111, 113-116,122-125,
127, 130, 132, 136, 140, 145, 147, 152, 155, 159, 163, 168, 175, 179, 187, 200, 206, 212. 218,226,234-237,
239, 241, 245, 247, 250, 258, 259, 261, 262, 270, 273-275.
M in in g , coop era tive......................................................................................................
15,16,152,209,261
N a tio n a lit ie s , cooperatives o f variou s.........................................................................................................................
177,
178,181,182,184-187,190-194,217-219,226,258,259,261-266,274,276
N eth erlands, cooperatives in the................................................ 7,8,10,12,14,16-21,23-28,31,34,36,38,39,42,87-97
N o rw a y , cooperatives in ................................................ 7,9,12,16-18,21,23-25,27,28,31,33,34,36-38,40,42,130-134
O c c u p a t i o n a l d istribution o f cooperative m em b ersh ip _______________________________ 140,156,200,219
P a r t y , C ooperative (G reat B ritain) (see a lso P olitica l parties)------- ------------------------------------------ --------- - 45,56
Patronage refunds, statistics o f........................................ 46,60,65,70,82,103,105,115,116,140,158,160,186,201,214
P e o p le ’s banks (se t also C redit cooperatives).................... 74,161,162,168,181,182,229,237,243,247,249,255,257
P e o p le ’ s houses, cooperative...................................................................... 11,61,65,66,68,71,178,180,181,209,269,272
Pharm acies (see D rugs).
P ola n d , cooperatives in .............................................................. 7,9,10,12-14,17,18,21,23-28,30,34,38-40,42,216-222
P olitica l parties and cooperatives...................................................................................................................................
17,
18, 41, 45, 56, 60, 62-66, 72, 73, 76, 82, 94, 95, 108, 133,158, 171, 177, 178, 181, 182, 184, 189, 213, 217,
219,223,227,228,231,234,235,240,244-246,250,254.
P op u la tion , cooperatives in relation t o ................................................................................................................. .......
25,
51, 60, 72, 99, 110,114, 119, 122, 123, 125, 129, 130,133, 134,139, 145, 148, 149,161, 164, 166, 167, 170,
171, 177, 180, 193, 194, 201, 207, 214, 216, 217, 223, 232, 242-244, 251, 253, 257, 264, 267, 273.
P ortugal, cooperatives in .....................................................
7,8,34,227,238,239
P ost-w ar reconstruction and coop era tives........................................................................ 3,13,14,36.37.75.77,231,252
P riv ate business and cooperatives— ...........................................................................................................................
19,
20, 61, 69, 81, 82, 93, 105-108, 115, 118, 128, 134, 141-144, 153, 173, 176, 186, 183-190, 193, 195, 196,
204,205,216.
P ro d u ctio n b y consum ers’ cooperatives...................................................................................................................... 24-29,
35, 40, 46, 48, 50, 52, 54, 55, 57, 64, 65, 70, 71, 74, 75, 79, 80, 94, 95, 99, 106, 107, 116-118, 123-127,
129, 131-134,138, 140-142, 144-147, 151-154, 157, 165, 171-173, 175, 185, 187, 191, 193, 200, 201, 205,
206,212,215,220,223,229,236,238,240,249-251,271,274.
P rod u ctiv e F ederation, C ooperative (G reat B rita in )............................................................................................. 47,55
P u b lic em ployees, cooperatives o f .................................. 60,63,71,72,83,209,210,211,214,217-219,233,247,271,274
Q u a lit y o f goods, cooperative efforts to im p rove_________________________________________________ 108,116,214
R a iffe is e n associations (see C redit associations).
R ailw a y workers, cooperatives o f.......................................................................................... 83,209-211,214,271,272,276
R ecreation (see WolferG)
R eligious groups, cooperatives o f . ..................... 17,20,60,63,72,95,103,163,217-219,226-228,231,234,240,265,266
R estaurants and other associations p ro v id in g m eals...................................... 16,100, 111, 123-125,128,135,222,225
R etail cooperatives (see a lso C onsum ers’ coop era tives)......................................................................... ............... 49-51,
62,100, 111, 135,149,191,198-207,209,239,240,245,247,267,268,271
R etailin g b y cooperative w holesales......................................................................................................... 53,54,80*141,151
R etail S ociety, C . W . S. (G reat B rita in ).....................................................................................................................
53
280
Development o f European Cooperatives
Page
R iver associations...................................................................... .............................................. ........ ....................... ...... 16,243,248,249
R ochdale principles and practice...........................................................................- ............................................... 2,35,65,66,1 89
R um ania, cooperatives in.................................................................................. 7 ,9 ,1 4 -1 8 ,2 0 ,2 2 -2 5 ,2 7 ,3 2 ,3 4 ,3 6 ,4 2 ,2 5 4 -2 6 5
Sanitation (see H ealth w ork).
Savings deposits accepted b y cooperatives (see also B anking activities)...............................................................
65,
67,70,74,124,131,136,138-140,170,171,173,180,198,204,211,272,275
Scandinavian Cooperative W holesale............................................................................................................................. 30,37,109
School children’ s cooperatives................................................................................ . ...................................................... 217,220,243
Scotland, cooperatives in ................................................................................................................. ....................... 2 4 ,2 9 ,3 8 ,4 0 ,4 2
Scottish Cooperative W holesale Society........................ . ............................. ........ ............................................................... 53,54
Soldiers’ cooperatives.......................................................................................................................................... 217,219,229,234,271
Soviet U n ion , cooperatives in th e................................................................. 7 ,9 ,1 4 ,1 5 ,1 8 ,2 4 ,2 5 ,3 1 ,3 4 ,3 8 ,4 0 ,4 2 ,2 2 2 -2 2 7
Spain, cooperatives in.............................................................................................. 7 ,9 ,1 4 ,1 6 ,1 7 ,2 3 -2 5 ,3 1 ,3 4 ,3 8 ,2 2 7 ,2 3 9 -2 4 2
State, cooperatives and the (see G overnm ent, cooperatives and).
Sw eden, cooperatives in............................................................ 7 ,9 ,1 2 -1 4 ,1 6 -1 8 ,2 1 ,2 3 -2 8 ,3 0 ,3 1 ,3 3 ,3 4 ,3 6 -4 0 ,4 2 ,1 3 4 -1 4 4
Switzerland, cooperatives in ............................. ........................... ................ 7 ,9 ,1 2 -1 4 ,1 6 -1 9 ,2 1 ,2 3 -2 6 ,2 8 ,3 0 ,3 4 ,3 8 -4 0 ,4 2
Taxation of cooperatives.... 69,81,85,108,110,118,128,132,146,156,160,173,188,199,209,241,249,252,253,260
T elephone associations....................................................................................................................................... ..... 16,46,120
T rading A gen cy, International C ooperative................................................ ................. ......................................2,38-40
T rad in g and M anufacturing A ssociation, International C ooperative___________________ _____________ 4,37
T rade (or business) total, o f cou ntry, cooperative im portance in......................................................................
26,
50, 60, 72, 73, 93, 99, 105, 106, 109, 110, 114, 117,119, 124, 134-136, 138, 139, 142, 145, 148, 150-152,
158,164,173,190,191,197,201,203,211,214,219,220,224,230,231,242,248-251,274.
Trade-unions, cooperatives and (see L abor organizations, cooperatives and).
T ransport associations..................................................... ............................................................... 16,209,229,232,236,237
Ukraine, western, cooperatives in .......................................................................................................................... 226,227
U lster A gricultural Organization S ociety..................................................................................................................
58
U nion, T h e C ooperative (G reat B ritain)_____________________________________ __________ ____ 45,48,53,55,56
War, cooperatives
and the.............................................................................................................................................
56,
57, 64, 72, 75-77, 83, 84, 86, 87, 96-99,108,117,118,121,128-130,133,134,140,143,144,145,150, 153,
154, 160, 165-167, 176, 183, 191-194, 206, 211, 215, 216, 221, 222, 226, 227, 237, 238, 243, 250, 251, 253,
254,264,266,275-277.
W elfare w ork b y cooperatives...................................................................................................................................... 11,12,
61,65-67,70,72,76,78,79,85-87,93,126,138,181,183,196,201,213,239,243,247,271,272
W holesales, cooperative.................................................................................................... ............................................
24,
25, 35, 46, 48, 51-55, 70-72, 79, 80, 83, 94-96, 106-108, 111, 116-118, 123, 126-134, 139, 141-146, 148,
150-152, 154, 156, 157, 159, 160, 163-165, 170-173, 175, 176, 182, 184, 185, 187, 191, 193, 194, 200-202,
208, 210-216, 218-220, 223, 227, 228, 233, 234, 236, 237, 240, 242, 244, 246, 249, 250, 262, 263, 271. 272,
274,275.
2,37,38
W holesale Society, International Cooperative..............................................................................................
W om en in the cooperative m ovem en t........................................................................................................ 40-42,249,270
W o m e n 's G uild, I n te r n a tio n a l C o o p e r a t i v e . . _______________ _________________ _______________________ 40-42
W orkers’ prod u ctive and labor associations....................................................................................... ................... .. 6-10,
14,15, 35, 36, 46, 47, 61-63, 65, 67, 70, 73, 74, 76, 83-87,110, 111, 131,132,135, 149, 161, 173, 177-179,
181, 188, 190,195, 196, 202, 208, 210,212, 222-224, 226, 227, 230-232, 234, 236-241, 243-245, 247, 248.
252,253,260-262,267,268,271-274.
Yugoslavia, cooperatives in.
7,9,11,13,14,16,17,23-25,28,30,34,43,265-277
@FedFRASER