RISING PRICES

Evening Star, Issue 22449, 21 September 1936, Page 11

RISING PRICES

A SUGGESTED SOLUTION AIM OF CO-OPERATIVE SYSTEM As an answer to rising prices and a solution of the present unemployment situation, the co-operative ■ ■ movement was comprehensively . dealt with f at a combined meeting of trade unionists held in the Trades Hall yesterday afternoon. The speaker was Mr D. von Stumer, secretary of the Hew Zealand Co-operative Alliance, Wellington, whose address was both interesting and instructive to his listeners. The speaker said that the aim of the movement was the changing of the motives of industry from profit to service, and the ultimate objective was the establishment of the, _ co-operative commonwealth, the social state in which there would be equality of opportunity both in fact and in theory, and in which the economic power of the individual would be in proportion to the social service rendered by the individual. It was the social state in which the bounty of Nature and the forces of production would be used exclusively to raise .the standard of living of the people rather than exploiting their needs. It was the social state in which the aim of education was to create internal harmony in the individual and between the individual and the rest of the community. The methods of the movement were quite practical and were capable of being applied without change in the constitution and without any disturbance of any sort to the ordinary business system. In fact, many leading business men were turning to co-operation as a way to permanent security and social progress. Like all other humanitarian movements, co-operation in its practical application arose' from the teachings of Robert Owen, who gave to the world two great principles—that to secure any permanent change in people the people themselves as individuals must take an intelligent and active part in affairs; and that the character and outlook of the masses were determined by their environment. Therefore,' to alter the people’s outlook, it was necessary to alter their environment.

Robert Owen himself spent a large fortune in trying to put into practice his own ‘ theoretical conclusions. He found that at his mills at New Lanark money spent in improving his workers’ conditions was not only raising the standard of living and' education, but also brought to him and his partners excellent financial results. To start with, Owen was regarded somewhat as a new prophet, but in later years, as his methods cut across the then recognised methods of business, he was made an outcast by other manufacturers and mot opposition from people whose outlook was something or a surprise. Between 1800 and 1840 many attempts were made by groups of workers to establish self-contained mutual aid communities, but after brief periods of success they languished and finally went out of existence. The main reason for these failures was lack of capital and lack of business experience, and, perhaps more important still, lack of loyalty by the members. The latter could be understood when it was realised that the profits of the concerns were distributed according to invested capital and not according to purchases or business done. This meant, of course, that a wealthy member, who purchased nothing, received more than a fair share of the profits, while a poor member with a large family, who spent all his earnings at the “ store,” received practically nothing, It was not until the Rochdale pioneers started their famous co-operative society at Toad Lane, Rochdale, that the co-operative system was placed on its present sound basis. The Rochdale plan, .on - wnich alj modern co-operatives were based, provided for one man one vote, cash dealing, limitation of interest on capital, elected committees tf management, open dealing and open membership, and. finally, distribution of producing surpluses according to pur-, chases. This first store was opened by 28 men who saved £2B in 12 months

and began business with five commodities only. The first year’s turnover was £7OO.

To-day the turnover of the-co-opera-’ tive movement in Great Britain was £400,000,000 per annum, membership had increased to 7} million, representing* half the population of the country, capital stood at £250,000,00, and thb employees numbered nearly 300,000, with a wage bill of nearly £40,000,000 per annum. Little did the Rochdale pioneers realise that in a short 90 years their small business would embrace 150 odd factories, 40,000 acres of tea plantations, five steamships, and the second largest bank in Great Britain. Of course, the surpluses went back to the members, who now shared nearly £30,000,000. per annum.

During the years of the depression the Staff increased from 235,000 to 276,000, and average wages rose by about 21s per annum. Yet outside the movement wages fell by about 40 per cent, and unemployment increased from one to three millions. The simple explanation was that co-operation was a system of planned production and distribution for consumption, not profit, .Before a co-operative industry was commenced the output was already sold. In other spheres of business gbods were produced and then sold by creating a demand for them. In the co-operative system each new venture was based on the demand already measured through the stores. There could thus be no haphazard measures, and employees were assured of permanent employment. As the primary 'motive was not profit, working conditions in the co-operative system were of paramount importance, and due consideration was always paid to workers’ ■welfare. A lot had been written and said about costs of production, but what of the costs of consumption, which included profits and distributing charges? In the co-operative system the aim was to supply all goods and services at cost. In the first place, however, prices were on a level with others in the district, and any overcharge was subsequently returned to the member purchaser as a rebate on his purchases. The saving thus effected gave rise to increased demand for luxurygoods. To meet this increased demand required more working people, and so created employment, besides raising the standard of living of the people. As an example, the Runanga Society was quoted. This society had returned to its mom hors no loss than £BO,OOO in the last 17 years, and this money had been used to buy wireless sets, vacuum cleaners, etc,, linos that could not otherwise have been purchased. Any new system, and particularly humanitarian legislation, required an efficient and sympathetic organisation to supplement and carry out its aims. The most important and least harsh organisation was that of the co-opera-tive movement, conchided the speaker, who made an appeal to nil consumers to support the local co-operative movement. .

Tlie speaker was accorded a hearty vote of thanks.