Co-op Movement Confronts Its Complicated Relationship With Racial Equity

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Above Photo: The Association of Black Economic Power. (Website and Facebook)

Last month, co-op educators and developers from Canada, the United States, and Puerto Rico came together in Minneapolis for the annual conference of the Association of Cooperative Educators (ACE). The group has met annually since 1952. A central theme at this year’s conference was the struggle to build a more racially inclusive co-op movement. While co-ops in communities of color, especially Black communities, in the United States have a rich history, they have often been ignored by what has been a largely white official co-op movement. But that is changing.

Me’Lea Connelly delivered the conference’s keynote address. Connelly directs the Minneapolis-based Association for Black Economic Power, a group founded in 2016 in the wake of the police shooting of Philando Castile. The group aims to open the Village Trust Financial Cooperative by 2019 in North Minneapolis—a neighborhood that is 49.5 percent Black—to serve the city’s underbanked Black community, which has seen much of its wealth siphoned off through payday lending and other financially exploitative practices.

The Village Trust project originated out of a community group called Blexit—a play on Brexit and referring to the need for “Black exit” or economic self-determination. Connelly helped found the group, which aims to cultivate the practice of economic civil resistance. As the group’s website explains, “The Black economy contributes 1.1 trillion dollars to the American economy, not to mention the revenue we generate as victims of racist and predatory practices across public and private sectors. The time has come to shift our dollars in ways that benefit and protect us all.”

The credit union fits into this larger economic self-determination effort. As Connelly explains, “We have communities that are underserved and also taken advantage of by at the most predatory businesses in our state… My dollars should be used to uplift my people. Not destroy them.”

Starting a new credit union may seem straightforward, but it is anything but. Nationally, as of June 30, 2018, the Credit Union National Association reports there are 5,714 credit unions in the United States with 116.3 million member-owners, a gain of two million new member-owners in the first half of 2018 alone. Times are good for existing credit unions.

But starting a new credit union is another matter entirely. Once, credit unions were started in church basements. In 1938, for instance, the Ferndale Co-op Credit Union in Ferndale, Michigan (near Detroit) was founded when 15 church members pooled $158. Even adjusting for inflation, that is about $2,750 in today’s dollars. By contrast, Connelly’s group has had to raise over $1 million. The high capital requirements help explain why only 28 new credit unions have received new charters nationally in the past decade, even as credit union membership nationwide has climbed by more than 25 million people over the same time period.

Consultants, Connelly notes, had informed her group that “we can’t have a credit union of have-nots.” But by the end of 2017, $1 million had been raised and “we had proved the consultants wrong,” Connelly says. Animating the group is not only the desire for economic self-sufficiency, but also the knowledge that the city’s Rondo community once had a Black credit union, until the building of a freeway destroyed the city’s Black business district in a classic instance of urban renewal.

While the organization of the credit union has been going well, Connelly notes that there are still many possible obstacles ahead, including the need for final federal regulator approval before opening. Using the acronym SCIP, Connelly says that white co-op allies can back co-ops in communities of color by supporting, celebrating, insulating, andprotecting them.

Additional Co-op Organizing Efforts in Communities of Color

The Village Trust Financial Cooperative is one prominent new co-op development featured at the conference that is taking place in a community of color. But it is hardly the only one.

Women’s Venture, another Minneapolis-based nonprofit, has supported women’s business development since 1977 with a mission to “to help women achieve economic self-sufficiency.” Its clientele is 95 percent female, 43 percent people of color, and 58 percent low-income. But the group has only recently started to promote cooperatives.

As Sarah Pike, the organization’s Women’s Business Center Director, explains, the main reason the group decided to take on cooperative business development is because in the childcare field, “Our solo entrepreneur students weren’t converting to ownership.” They lacked capital and it was too overwhelming, Pike explains. Pike adds that the group decided that, “We can use the co-op model to pool necessary financial resources for start-up capital and address low wages by shrinking the differential between the highest and lowest paid in childcare.”

The first cohort, which included 23 women interested in forming childcare co-ops, began in January 2018; at present, three co-ops have emerged from that cohort and have reached the pre-launch “incubation” stage. A second cohort will start in January 2019.

Another co-op organizing effort has focused on Latinx farmworkers in rural Minnesota. The lead nonprofit developer, the Latino Economic Development Center, like Women’s Venture, has traditionally focused on supporting individual ownership. But it began to organize marketing co-ops for rural farmers in 2010. Initial efforts fell short, but over time gains have occurred. The Shared Ground Cooperative, founded in 2014, helps seven local farms (six of which are Latinx-owned) gain access to the Twin Cities marketplace. In 2018, the co-op anticipates generating $500,000 in sales for its members, with a goal of reaching $1.5 million in the next four to five years.

One more policy-based effort highlighted at the conference was the formation of the Madison Cooperative Development Coalition in Madison, Wisconsin. In Madison, the city government has committed $3.2 million over five years to support co-op development. Half of that money is distributed in the form of grants to pay for nonprofit technical assistance, while the other half is used to seed loan funds that can meet the financing needs of worker co-op businesses. As coalition coordinator Charity Schmidt explains, the goal of the program is to “create worker co-ops, with a specific emphasis on building unionized co-ops in communities of color, low-wealth communities and communities excluded from the traditional workforce.” The program, Schmidt adds, aims to achieve this goal by developing “culturally relevant businesses that can build from existing networks and neighborhoods.” 

Rethinking Co-op Education in the Food Co-op Sector

Despite some changes in recent years, food co-ops are among the whitest of co-op sectors. In 2015, two food co-op consultants, Jade Barker, who is Black, and Patricia Cumbie, who is white, teamed up to write a book on the topic. Their book, which was published last fall, is titled Everyone Welcome?: Personal narratives about race and food co-ops. At the conference, Cumbie presented highlights of their findings.

As Barker and Cumbie write in their overview chapter, “Even in multi-racial neighborhoods, food co-ops have overwhelmingly white ownership and staff. If everyone is welcome, why do so few people of color participate in food co-ops today?”

In a magazine article that draws on their book, the authors paint a more detailed picture:

In most food co-ops across the country, nearly everyone involved, from board members, staff, management, and the customer base, is white—and represents a subset of Americans supported in their attainment of high-quality natural foods by higher education and professional occupations. According to our interviews, many of our participants of color have long felt excluded or ignored by the white food co-op movement, despite its professed values of equity and cooperation.

As Cumbie notes, there are many reasons why food co-ops have become white spaces. These include, Cumbie says, the dominance of white cultural norms, economic disparities, attitudes of exclusivity (such as misplaced white assumptions that people of color don’t live in the neighborhood even when they do, or that people of color are not interested in healthy food even though they are) and racial insularity, including unexamined racism that can lead food co-ops to not hire people of color or fail to adequately respond to incidents of racism.

In their book, Barker and Cumbie outline recommended action steps to achieve racial equity through community outreach, confronting bias, and member education. Under “outreach,” Barker and Cumbie recommend changing hiring practices, partnering with organizations that work in communities of color, and ensuring affordable food options for low-income residents, who are often disproportionately people of color. To overcome bias, Barker and Cumbie emphasize that co-ops need to adopt an explicit anti-racism stance. In terms of education, they emphasize making sure that co-op history taught to co-op members is inclusive. As Cumbie puts it, “We love the [19th-century British] Rochdale pioneers, but not to the exception of everyone else.”

LaDonna Redmond, a Black food activist who had previously worked to bring organic produce to Chicago’s West Side, has been at Seward Community Co-op in Minneapolis for five years, where she serves as director of diversity and community engagement. At Seward, Redmond has been promoting the kind of cultural changes that Barker and Cumbie advocate.

Redmond points out that one central impetus for change at Seward—and indeed an impetus for her hire—was that the co-op in 2013 was developing a second grocery store in a Black neighborhood. The store ultimately celebrated its grand opening in February 2016.

But getting there wasn’t easy. Initially, Redmond notes, there was considerable community skepticism about the co-op, as many Black community members felt the co-op was not for them. “The co-op leadership was surprised when the reaction that they got from the community was initially hostile,” notes Redmond. Among the questions at one early forum, Redmond recalls, were “What is a co-op? Why should I be interested in it? Why should I trust you?”

To make food co-ops truly open to communities of color, one theme Redmond emphasizes is the importance of addressing oppression at multiple levels—personal, cultural, institutional, and structural. She also says that in dismantling structural racism in co-ops, it is important to apply an intersectional lens to understand, for example, “the ways that sexism and racism intersect to oppress Black women” and how, more broadly speaking, interlocking oppression plays out.

Like Cumbie, Redmond also emphasizes the importance of decentering the cooperative origin story of the 1844 Rochdale Pioneers in England and recognizing that while the legal economic cooperative form may date from 1844, economic cooperation itself has a far longer and older history that is deeply rooted in communities of color. Redmond posed four questions for attendees developing co-op history curricula to consider in how to build racial equity in their own co-ops:

  • What other story could be revealed in this setting?
  • What other “psychic break” could you make up?
  • What other underlying assumption here could you challenge?
  • Who has the power to make this narrative change?

Redmond advises, too, looking at the Black Panther Party 10-Point Plan from 1966, as well as the co-op movement’s international principles, as a way to generate discussion about the relationships between the two sets of principles. “In an intercultural context,” Redmond notes, “shared meaning cannot be assumed; shared meaning must be discovered.”