1939: Cooperation

The cooperative movement in the United States continues to make its greatest headway among agricultural groups. Marketing, purchasing, insurance, irrigation, credit, and many other services are being performed to an increasing extent by farmers' cooperative associations. In these cooperative undertakings. American farmers have been getting a considerable amount of assistance from the Farm Credit Administration. This governmental agency, through its several units, seeks to aid cooperatives in solving their problems and in developing new methods so that they may operate most effectively.

Farm Cooperatives.

During 1939 a volume of business amounting to approximately 2½ billion dollars was done by the agricultural marketing and purchasing cooperatives. About three-fourths of the farm cooperatives are marketing associations, handling a large variety of crops among which cotton, dairy products, livestock, poultry and eggs have been gaining in relative importance. Grains, fruits, and vegetables continue to occupy an important place in the cooperative marketing program.

Cooperative purchasing during the past year has continued to grow. Through 10,000 local cooperative groups, approximately 2,000,000 farmers obtained farm supplies with a retail value exceeding $400,000,000. One of the most important products bought cooperatively is petroleum, which constitutes about one-fourth of the total purchases. Feed, fertilizer, seed, and machinery are also prominent items on the list of cooperative purchases.

More than $11,000,000,000 worth of insurance was in force in 1939 through farmers' mutual insurance companies. All varieties of farm risk are handled by these farmers' mutuals although emphasis is placed upon windstorm and fire insurance. Over 60 specialized farmers' mutual windstorm insurance companies are in operation, while 300 fire insurance groups also write windstorm policies. Such insurance exceeds one-fifth of total property insurance in force. The mutual fire insurance companies, about 2,000 in number, insure well over half of all insured farm property in the United States, and in a few of the northern states in which farm mutuals are relatively numerous, nearly three-fourths of the business is done by these organizations.

Approximately half of the 15,500 farmers' cooperative associations and mutual companies in the United States used borrowed funds in connection with their operations. Especially in need of credit were tobacco, cotton, grain, and creamery cooperatives where substantial investments in inventories and physical facilities were required. Borrowing during the year exceeded 300 millions. While the principal sources of credit were the commercial banks, about one-fourth of the loans were obtained through the banks for cooperatives.

Production credit for individual farmers to finance all types of farm and ranch operations is extended to several thousand farmers and stockmen through some 535 production and credit associations at interest rates of 4½ per cent. Longer term loans are obtained through 4,000 local national farm loan associations which are serving over 600,000 members, who have cooperative mortgage loans outstanding of nearly two billion dollars. These loans are amortized in from 20 to 30 years. Interest rates in 1939 were down to 4 per cent on new loans.

Credit Unions in the United States.

Approximately 8,000 credit unions and cooperative savings associations are now operating in the United States. Of these 3,200 are Federal credit unions, chartered and examined by the Farm Credit Administration. These cooperatives are organized for the purpose of promoting thrift among their members and creating a source of credit for provident and productive purposes. Although some of the associations have been formed by farmer cooperatives, the majority of them are urban groups whose membership consists of employees of large business firms, labor unionists, teachers, church congregations and government employees. Membership in these credit unions exceeds 2,000,000 and total loans during 1939 amounted to roughly 200 million dollars. Illinois was the leading credit union state, both in number of associations and members.

Cooperation also takes the form of workers' industrial production cooperatives. This type has not been very widespread. The best contemporary illustration of it in the United States is the cooperative clothing workers project in Hightstown, New Jersey.

Consumer Cooperatives in the United States.

Consumer cooperation, while still in its infancy in the United States, (accounting for less than 2 per cent of retail sales) continues to show signs of growth. The Cooperative League of the United States is the leading national unit of the consumer cooperative movement. During 1939 this organization had associated with it 19 regional groups. Included among these are the National Cooperative and the United Cooperative, which are federations of large wholesale cooperatives. Collectively, they serve almost 2,000 local associations with about 1,000,000 patron members. Unaffiliated associations probably accounted for an additional million cooperative retail members. A large proportion of these consumer groups are rural organizations supplementing farmers' purchasing associations in the buying of household supplies, groceries and wearing apparel. Other leading units are the cooperative oil associations which operate filling stations and cooperative chain grocery and food stores. The balance of the list is made up of clothing, dry goods, and electrical appliance stores, and cooperative bakeries, creameries, cafeterias, and water supply associations. Interim reports by regional cooperative units showed a trend toward increased sales during 1939. Eastern Cooperative Wholesale (largest cooperative wholesale in the East) estimated its total business for the year at roughly $1,000,000 against slightly more than $700,000 in 1938. The Central Cooperative Wholesale (cooperative grocery distributor) reported monthly sales in September 1939 at $430,000 — the highest in its history.

In addition to these retail cooperative societies there are thousands of other associations in such fields as life insurance, medicine, burial aid, housing, laundry, and miscellaneous services. Cooperative college bookstores, cafeterias and dormitories have also grown in size and number. Although not directly linked with the cooperative movement, various consumer service organizations such as Consumers Research and the Consumers Union have aided the movement to a considerable extent by making the consumer increasingly aware of his role as a buyer. These groups compile information on consumer goods and services and offer assistance on matters relating to family income and the expenditure of earnings. The Consumers Guide service of the United States Agricultural Adjustment Administration is of a similar character. See also INTERNATIONAL CONFERENCES AND CONGRESSES.