Interview: The Deep Roots of African American Cooperative Economics

Wedge Food Coop in Minneapolis

Anticipating the upcoming Jackson Rising: New Economies Conference in Jackson, Missisissippi, I interviewed Jessica Gordon Nembhard, an expert on African American History and Cooperatives. Here's a sneak peek of insights from her groundbreaking new book, Collective Courage: A History of African American Cooperative Economic Thought and Practice.

Through her extensive research, Jessica Gordon Nembhard chronicles how African Americans used cooperative economic practices to help each other survive and how those practices related to the Black civil rights and economic equality movements. The book could have a dramatic effect on our view of African American collective agency with implications for grassroots economic organizing.

Jessica Gordon Nembhard on Laura Flanders Show

Mira: Why did African-Americans first start getting involved in cooperative economic activity? Was it for political or practical reasons or both?

Dr. Gordon Nembhard: African Americans started using cooperative economics from the moment they were forcibly brought to the Americas from Africa, at first for practical reasons. They realized that their survival depended on working together and sharing resources. They had collective traditions from the African nations and civilizations they came from, that they applied in the Americas when they could.

These were informal resource pooling for enslaved as well as free African Americans. Enslaved Blacks might share a small kitchen garden to provide more variety of food than what the master would give them. Those that had opportunity to earn money would pool those earnings to buy each other’s freedom – when there was a master who was willing to sell. The Underground Railroad was a collective interracial effort to provide a hidden and protected route North to safety for fugitives from enslavement. Gradually, enslaved as well as freed Blacks started mutual aid societies through religious and fraternal institutions. These pooled members’ dues and monthly fees to use to bury a member, provide a small stipend for widows and orphans, for health care access, etc.

As more and more became free, the Mutual Aid Societies became larger and covered more services. Eventually some evolved into mutual insurance companies. Freed African Americans in those early years and after the Civil War also pooled money and labor to buy and run a farm or jointly buy farm supplies and reduce costs. Many whites would not sell them the supplies they needed or only at an exorbitant price.

Mira: Can you tell us about other types of cooperative economic activities have Africans been engaged in?

Dr. Gordon Nembhard: After Reconstruction, some elements of organized labor joined together for  economic and political reasons to try to win political rights for small farmers, laborers and Blacks. There were a few integrated unions that operated mostly in the South. The Knights of Labor is one group in the 1870s and 80s that promoted cooperative stores/ warehouses, collective lending (credit outlets), and worker cooperatives to run cotton mills and other small factories or production centers.

The former white plantation owners and masters (The Plantation Bloc) attacked these unions fiercely – harassing members, killing white leaders, lynching Black leaders and members, burning down the co-ops and using economic sabotage (declining loans, withholding supplies) as well. As one group would go underground and disburse, others started. The next group was the Colored Farmers’ Alliance and Cooperative Union – this time all Black, with connections to the Southern Farmers’ Alliance. They had similar aims to the Knights of Labor, but increased efforts. They were able to establish a few cooperative “exchanges” (warehouses and credit outlets) in several southern towns (Norfolk, Charleston, Mobile, New Orleans, and Houston). But the opposition and violence against them was so strong, these efforts did not last long either.

In the North, the Mutual Aid Societies were strong and most of the early cooperative activity was based around those efforts. The first Rochdale type (formal business model based on the European Rochdale principles of cooperatives) African American cooperative that I learned about started in 1901 in Ruthville, Virginia, Mercantile Cooperative Company. In 1915, the Pioneer Cooperative Society formed in Harlem and opened a small grocery store in 1919. The Colored Merchants Association, a marketing cooperative of independent African American grocers, was founded by the National Negro Business League in Montgomery, Alabama, in 1927.

Black school co-ops, farm co-ops, marketing co-ops, grocery co-ops, gas station co-ops, housing co-ops, credit unions, and mutual insurance companies were established throughout the late 1920s-1940s in cities such as: Harlem and Buffalo, New York; Richmond, Virginia; Bricks, North Carolina; Chicago, Illinois; Memphis, Tennessee; Bluefield, West Virginia; Gary, Indiana; Omaha, Nebraska; Philadelphia, Pennsylvania; Washington, DC; and Kansas City, Missouri. I found the most African American cooperatives during this period in the states of North Carolina and New York.  Organizations such as the Eastern Carolina Council (North Carolina), the Young Negroes’ Co-operative League, and the Brotherhood of Sleeping Car Porters promoted and supported African American cooperative economic development during that period.  

The 1960s and 70s was also a period with a significant number of African American cooperatives, particularly supported by the Federation of Southern Cooperatives, as well as the Black Panther Party, the Nation of Islam, and other Black or co-op support organizations.

United Auto Workers of Detroit host a screening of Shift Change

Mira: What are some of the more unique stories of people getting creative with economic activities together? What are some of your more surprising findings?

Dr. Gordon Nembhard: The most surprising finding is that there is such a long and strong history of African American economic cooperation. I found so many examples of African American cooperatives of all kinds, and so many African American leaders and activists who promoted cooperative economics as a strategy for Black survival and independence. Also there were co-ops in the North and the South; in cities, towns and rural areas; in a variety of types and industries; and in just about every era throughout US history. Women leaders were as prevalent as male leaders in the Black co-op movement. Also surprising was learning how dangerous (physically and economically) it was for African Americans to attempt to establish cooperatives, especially in the South, but not only in the South. That is one of the reasons why I titled the book “Collective Courage.”

Some unique stories:

In 1934, the Bricks Rural Life School in Bricks, North Carolina, run by the American Missionary Association, developed a program of adult education for African American cooperative development. Two years later, the school organized a credit union. Members then jointly bought a tractor. In 1938, the school opened a cooperative store, and in 1939 it developed a health program. The members raised half the cost of a full-time nurse and persuaded the state’s Health Department to fund the other half. Small purchasing and service groups were established in the surrounding communities. By the late 1940s, more than three-quarters of the families in Bricks had at least one member connected with one of the co-ops.

The Freedom Quilting Bee was established in 1967 in Alberta, Alabama. It is a handicraft cooperative founded by women in sharecropping families who needed to increase and stabilize their meager incomes. The women began selling quilts to supplement their families’ farm incomes. In 1968, the cooperative bought twenty-three acres of land on which to build their sewing factory. They also provided day care and after-school services for members’ children and others at the sewing factory. Having the cooperative own its own land gave members independence. The twenty-three acres were thus important not only to the co-op’s own survival and growth but also to that of their families and the larger community. The co-op sold eight lots to families who had been evicted from their homes and land and needed to start over.

Economic independence and control over land were particularly important to members of the cooperative because many families lost the land that they had been sharecropping because of their involvement in civil rights activism. Some were evicted from their farms for registering to vote, and others were evicted on their return from hearing Dr. Martin Luther King speak in a nearby town in the mid-1960s.  In addition, the quilters began using other entrepreneurial strategies to increase the economic activity under their control.  In the early years, FQB was a member of the Artisans Cooperative which helped FQB members to diversify their products.  In 1967, the cooperative was a founding member of the Federation of Southern Cooperatives.

In 1992 after the uprising in South Central Los Angeles (following the police acquittals in the Rodney King case), Food from the ‘Hood, a student-led co-op at Crenshaw High School in Los Angeles, started a school garden and gave the produce to their low-income neighbors. They also began to sell their vegetables at a farmers’ market, and then started a multiyear project to sell salad dressing made from produce grown in their school garden. The student co-op owners mentored other students and the co-op continued even as the original students graduated. By 2003, seventy-seven members had graduated and gone on to college, using money earned from working in the co-op. Because the co-op retained the students’ earnings to hold for them as a college fund, the high school started a college preparation program since they had a regular stream of students who were interested in attending and could afford to go.

Black Panther's free breakfast program in Oakland, CA

Mira: How has this work supported the civil rights and black power movements or vice-versa?

Dr. Gordon Nembhard: The example of Freedom Quilting Bee is one way that cooperatives directly supported the civil rights movement and people’s involvement in the civil rights movement. Almost all African American leaders and major thinkers, from the most conservative to the most radical, have at some point promoted cooperative economic development as a strategy for African American well-being and liberation (I listed some of their organizations above). This creates a connection in history between the long civil rights movement and creation of alternative community-based economic institutions using cooperative economics.

Many of the same leaders who promoted political rights for African Americans and petitioned the government in many different ways, also more quietly and in practice promoted economic cooperation as the way to help Black communities survive racial and economic discrimination: W. E. B. Du Bois, A. Philip Randolph, Marcus Garvey, E. Franklin Frazier, Nannie Helen Burroughs, George Schuyler, Ella Jo Baker, Dorothy Height, Fannie Lou Hamer, and John Lewis, as well as Halena Wilson, Jacob Reddix, W. C. Matney, Charles Prejean, Estelle Witherspoon, Ralph Paige, and Linda Leaks. Civil Rights strategist Ella Jo Baker, for example, started her career in the cooperative movement and was the first executive director of the Young Negroes’ Co-operative League in the 1930s. Members of the Black Panther Party used collective housing and promoted cooperative housing for the community; established cooperative bakeries, and free breakfast programs for children in the community in the 1960s.

Mira: There are many foundations, city agencies and nonprofits addressing poverty now in communities of color, but few integrate cooperative economics into their programs. Why is that and what are your suggestions as to how it can be used to support long-term poverty reduction and community empowerment?

Dr. Gordon Nembhard: Cooperatives are an under-appreciated resource and economic strategy. They are often denigrated because they are misunderstood or because they are unfairly assumed to be too radical, too small scale and/or too precarious. Challenges to cooperatives living up to their potential include that the model is not well known and is often denigrated which reduces people’s exposure to the model and precludes potential services and supports from agencies that help small businesses. In addition, capitalization and access to capital for cooperatives are limited; and state (and federal) laws are not equivalent and often preclude the licensing of certain kinds of cooperatives. Meanwhile, cooperatives are an old model that has been used by every group throughout history, about half the world’s population (an estimated 3 billion people) are connected to cooperative enterprises for their livelihood in some way (according to the International Cooperative Alliance). Cooperative businesses have lower failure rates than traditional corporations and small businesses, after the first year of startup, and after 5 years in business.

The word is getting out internationally about the potential of cooperative economic development, especially for low-income communities and among marginalized populations and immigrant groups. The United Nations (UN) and the International Labour Organisation (ILO) recently recognized the potential of cooperative enterprises for economic development and poverty reduction. The UN designated 2012 as “the International Year of Cooperatives” to raise public awareness of the "invaluable contributions of cooperative enterprises to poverty reduction, employment generation and social integration” and to “highlight the strengths of the cooperative business model as an alternative means of doing business and furthering socioeconomic development.” The UN then designated 2013-2023 as the decade of cooperation. During the UN’s 2005 Year of Micro-Credit, the International Cooperative Alliance and ILO highlighted the role that cooperative enterprises have played for more than a century in providing microfinance and supporting microenterprise throughout the world when it launched the campaign, “Micro-finance is our business: Co-operating out of poverty.” Several important studies came out of that campaign, which show how cooperatives are successful anti-poverty enterprises.

 This past February, The Federation of Protestant Welfare Agencies in NYC issued a report demonstrating that worker cooperatives address income inequality in a variety of ways, and suggested how New York City could support worker cooperatives more. Community members around the country could put together similar reports, and make similar demands of their municipal governments, private foundations and other funding sources and community developers.

Mandela Foods Cooperative in Oakand, CA

Mira: How might cooperatives support broad social change, based on your research, and what can people do in their own communities to support the development of a cooperative economy locally?

Dr. Gordon Nembhard: Cooperatives solve economic problems in different ways than conventional for-profit businesses. They operate on the values and principles of democratic participation, inclusion, solidarity, sharing, sharing, and ‘for need’ rather than ‘for profit.’ Cooperative businesses stabilize communities because they are community-based business anchors, and they distribute, recycle, and multiply local expertise and capital within a community. They enable their owners to generate income and jobs, accumulate assets, provide affordable, quality goods and services, develop human and social capital, and at the same time are family and community friendly. Co-op members acquire a variety of general business and industry-specific skills. They also develop leadership skills and team building experience, and a sense of their own agency. All these skills are transferrable and members use them in other aspects of their lives – thus increasing their capacity as good citizens and change makers.

Cooperative economic development has been successful in urban as well as rural areas, among women and men, and every racial and ethnic group around the world. They develop - and survive - as a response to market failure and economic marginalization. Cooperatives address market failure and fill gaps that other private businesses and the public sector ignore like the provision of rural utilities in sparsely populated areas, affordable healthy and organic foods in food deserts, access to credit and banking services, affordable housing, child or elder care, to markets for culturally sensitive goods.

Cooperatives address such issues as community control in the face of transnational corporate concentration and expansion, the pooling of resources and profit sharing in communities where capital is scarce and incomes low and  increased productivity and improved working conditions in industries where work conditions may be poor and wages and benefits usually low. Cooperatives can be part of the solution in rebuilding after economic recessions - they, like other elements in the solidarity economy, start where people are and build from the ground up.

Fannie Lou Hamer once said that “Cooperative ownership of land opens the door to many opportunities for group development of economic enterprises which develop the total community rather than create monopolies that monopolize the resources of a community.” In the 1970s, she advocated for all kinds of cooperatives to meet the needs of people, and as necessary to establish economic independence in the face of economic and political discrimination and retaliation.

Increasing awareness of and information about cooperatives among the general public and government agencies and employees is one of the most important first steps. We also need expanded, less restrictive, and more uniform co-op laws (at state and federal levels) and supportive infrastructure, particularly for startup, capitalization, and financing (at all levels). This includes establishing loan funds, small business services, and workforce funding dedicated to cooperative development. The Federation of Protestant Welfare Agencies in NYC suggests the use of municipal economic development corporations and departments of small business services to grow worker cooperatives and that cities could prioritize worker cooperatives as preferred contractors.

Two new worker coops in Worcester, MS - Future Focus Media and Toxic Soil Busters

Mira: Why did you write this book specifically about African Americans and cooperative economics?

Dr. Gordon Nembhard: I became very interested in community-based economic development in the 1990s. I am a political economist and originally studied international finance reform and international development. I took a job with the Children’s Defense Fund in Washington DC as a economic development analyst for the Black Community Crusade for Children and started to study community-initiated and community-based economic development strategies and economic structures that would be family friendly, support community building values and be sustainable and anti-poverty.

Some of us started talking about cooperatives and I remembered that a graduate school classmate of mine, Dr. Curtis Haynes, had studied W.E.B. Du Bois’ theory of economic cooperation and a group economy for African Americans and those left out of or discriminated by traditional economic structures. At that time, I was focused on African Americans and started looking for theories of and examples of Black community and cooperative economic development.

My original plan was to focus on Black cooperatives for the first couple of years and then branch out to examine Latino/a co-ops and Native American (First Nations) cooperatives. However, I kept discovering more and more information about African American participation in the co-op movement and so haven’t had a chance to move on to other groups yet.  

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