The Co-op Food Stores

added 12/21/09

by Jaime Richardson and Rosemary Fifield

An historical comparison of the 1930s and today reveals many similar issues: crashes on Wall Street, climbing unemployment rates, industry and banking collapse, international conflict, use of the terms “recession” and “depression,” instability of oil and gas prices, environmental degradation, and more. While comparisons can be discouraging, one topic shines as a symbol of hope then and now: the cooperative movement.

Following the stock market crash in 1929, Americans faced the loss of jobs, income, housing, and access to quality goods. More than 25 percent of the American population was unemployed, hungry, and without hope when Franklin Delano Roosevelt took office as President in 1933. While Roosevelt’s New Deal is best known for establishing the Civilian Conservation Corps and Works Projects Administration (WPA), it also introduced a number of cooperative solutions, including a cooperative bank to provide credit to farmers and the Federal Credit Union Act “to make more available to people of small means credit for provident purposes through a national system of cooperative credit, thereby helping to stabilize the credit structure of the United States.”

During that same period, rural electric co-ops ensured that the vast majority of the U.S. population—those outside of major cities—received electrical service. Worker cooperatives and consumer cooperatives were springing up across the country as people sought to help themselves. By 1935, farmers had formed 10,500 agricultural cooperatives that allowed them to purchase supplies such as petroleum in volume or that collected and marketed their products. Land O’Lakes emerged during that time as a significant dairy cooperative in the Midwest.

The Upper Valley of Vermont and New Hampshire was not immune to the effects of the Great Depression. From food and farming supplies to household items and clothes, fewer items were available and those that were were of questionable quality. In 1936, Dartmouth College, a major employer, imposed a salary reduction on its faculty and staff.

In our Co-op’s historical video “Hand in Hand,” early members of the Hanover Consumer Cooperative Society speak of their struggles to make ends meet, their dismay over the quality of fresh produce available at the local store, and the excitement of working together to form a consumer cooperative that would bring them better products at a fair price. An early issue of the group’s newsletter announces the Co-op’s move to new quarters on Main Street in Hanover and answers the question “Why?” with: “To render the best service to our members, with guaranteed quality, and to be a full-fledged part of the Cooperative Movement of the United States!”

Cooperatives as agents of self-help are not a fad nor are they an anachronism. New cooperatives—be they consumer, producer, worker, or housing—continue to form, while existing co-ops are working harder than ever to meet the needs of their member-owners. Today’s cooperatives and credit unions remain unique institutions with a “not for profit but for service” operating philosophy and an eye on the social and environmental, as well as financial, welfare of their communities.

A Credit Union Co-op Pioneer

Philanthropist and entrepreneur Edward Filene, who built his father’s Boston department store into a successful retail chain, was also a pioneer in the establishment of American credit unions.

After visiting rural cooperative banks in other countries, Filene promoted the establishment of similar organizations in his native Massachusetts, believing that ordinary people could improve their economic condition if given “good information and the discipline to use it effectively.” First and foremost, credit unions promote thrift and provide credit at reasonable rates.

Filene allegedly coined the term “credit union” because he saw these memberowned financial institutions as working people united against opportunistic lenders who charged excessively for consumer loans.

Did You Know?

The first credit union in the United States, St. Mary’s Bank, was organized on November 24, 1908 in Manchester, New Hampshire. Monsignor Pierre Hévey, pastor of St. Mary’s Church, saw the need for his French-Canadian textile mill working parishioners to have financial services. He invited Alphonse Desjardins, the father of Canadian credit unions, to speak to the community about the benefits of credit unions, and his parishioners organized a credit union that day!

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