Cooperative federalism is a school of thought in the field of cooperative economics. Historically, its proponents have included J.T.W. Mitchell, Charles Gide,[1] Paul Lambert,[2] and Beatrice Webb (who coined the term in her book The Co-operative Movement in Great Britain).[3]
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Weekly current affairs analysis 2016 (Sample video) :UDAY: DISCOMS: Problems: Cooperative federalism
Transcription
Hi, I'm Craig and this is Crash Course Government and Politics. Today we're going to talk about a fundamental concept to American government, federalism. Sorry. I'm not sorry. You're not even endangered anymore. So federalism is a little confusing because it includes the word, "federal," as in federal government, which is what we use to describe the government of the United States as a whole. Which is kind of the opposite of what we mean when we say federalism. Confused? Google it. This video will probably come up. And then just watch this video. Or, just continue watching this video. [Intro] So what is federalism? Most simply, it's the idea that in the US, governmental power is divided between the government of the United States and the government of the individual states. The government of the US, the national government, is sometimes called the federal government, while the state governments are just called the state governments. This is because technically the US can be considered a federation of states. But this means different things to different people. For instance, federation of states means ham sandwich to me. I'll have one federation of states, please, with a side of tater tots. Thank you. I'm kind of dumb. In the federal system, the national government takes care of some things, like for example, wars with other countries and delivering the mail, while the state government takes care of other things like driver's license, hunting licenses, barber's licences, dentist's licenses, license to kill - nah, that's James Bond. And that's in England. And I hope states don't do that. Pretty simple right? Maybe not. For one thing, there are some aspects of government that are handled by both the state and national government. Taxes, American's favorite government activity, are an example. There are federal taxes and state taxes. But it gets even more complicated because there are different types of federalism depending on what period in American history you're talking about. UGH! Stan! Why is history so confusing!? UGH! Stan, are you going to tell me? Can you talk Stan? Basically though, there are two main types of federalism -dual federalism, which has nothing to do Aaron Burr, usually refers to the period of American history that stretches from the founding of our great nation until the New Deal, and cooperative federalism, which has been the rule since the 1930s. Let's start with an easy one and start with dual federalism in the Thought Bubble. From 1788 until 1937, the US basically lived under a regime of dual federalism, which meant that government power was strictly divided between the state and national governments. Notice that I didn't say separated, because I don't want you to confuse federalism with the separation of powers. DON'T DO IT! With dual federalism, there are some things that only the federal government does and some things that only the state governments do. This is sometimes called jurisdiction. The national government had jurisdiction over internal improvements like interstate roads and canals, subsidies to the states, and tariffs, which are taxes on imports and thus falls under the general heading of foreign policy. The national government also owns public lands and regulates patents which need to be national for them to offer protection for inventors in all the states. And because you want a silver dollar in Delaware to be worth the same as a silver dollar in Georgia, the national government also controls currency. The state government had control over property laws, inheritance laws, commercial laws, banking laws, corporate laws, insurance, family law, which means marriage and divorce, morality -- stuff like public nudeness and drinking - which keeps me in check -- public health, education, criminal laws including determining what is a crime and how crimes are prosecuted, land use, which includes water and mineral rights, elections, local government, and licensing of professions and occupations, basically what is required to drive a car, or open a bar or become a barber or become James Bond. So, under dual federalism, the state government has jurisdiction over a lot more than the national government. These powers over health, safety and morality are sometimes called police power and usually belong to the states. Because of the strict division between the two types of government, dual federalism is sometimes called layer cake federalism. Delicious. And it's consistent with the tradition of limited government that many Americans hold dear. Thanks Thought Bubble. Now, some of you might be wondering, Craig, where does the national government get the power to do anything that has do to with states? Yeah, well off the top of my head, the US Constitution in Article I, Section 8 Clause 3 gives Congress the power "to regulate commerce with foreign nations, and among the several states, and with the Indian tribes." This is what is known as the Commerce Clause, and the way that it's been interpreted is the basis of dual federalism and cooperative federalism. For most of the 19th century, the Supreme Court has decided that almost any attempt by any government, federal or state, to regulate state economic activity would violate the Commerce Clause. This basically meant that there was very little regulation of business at all. FREEDOOOOOOMM! This is how things stood, with the US following a system of dual federalism, with very little government regulation and the national government not doing much other than going to war or buying and conquering enormous amounts of territories and delivering the mail. Then the Great Depression happened, and Franklin Roosevelt and Congress enacted the New Deal, which changed the role of the federal government in a big way. The New Deal brought us cooperative federalism, where the national government encourages states and localities to pursue nationally-defined goals. The main way that the federal government does this is through dollar-dollar bills, y'all. Money is what I'm saying. Stan, can I make it rain? Yeah? Alright, I'm doing it. I happen to have cash in my hand now. Oh yeah, take my federal money, states. Regulating ya. Regulator. This money that the federal government gives to the states is called a grant-in-aid. Grants-in-aid can work like a carrot encouraging a state to adopt a certain policy or work like a stick when the federal government withholds funds if a state doesn't do what the national government wants. Grants-in-aid are usually called categorical, because they're given to states for a particular purpose like transportation or education or alleviating poverty. There are 2 types of categorical grants-in-aid: formula grants and project grants. Under a formula grant, a state gets aid in a certain amount of money based on a mathematical formula; the best example of this is the old way welfare was given in the US under the program called Aid to Families with Dependent Children. AFDC. States got a certain amount of money for every person who was classified as "poor." The more poor people a state had, the more money it got. Project grants require states to submit proposals in order to receive aid. The states compete for a limited pool of resources. Nowadays, project grants are more common than formula grants, but neither is as popular as block grants, which the government gives out Lego Blocks and then you build stuff with Legos. It's a good time. No no, the national government gives a state a huge chunk of money for something big, like infrastructure, which is made with concrete and steel, and not Legos, and the state is allowed to decide how to spend the money. The basic type of cooperative federalism is the carrot stick type which is sometimes called marble cake federalism because it mixes up the state and federal governments in ways that makes it impossible to separate the two. Federalism, it's such a culinary delight. The key to it is, you guessed it - dollar dollar bills y'all. Money. But there are another aspect of cooperative federalism that's really not so cooperative, and that's regulated federalism. Under regulated federalism, the national governments sets up regulations and rules that the states must follow. Some examples of these rules, also called mandates, are EPA regulations, civil rights standards, and the rules set up by the Americans with Disabilities Act. Sometimes the government gives the states money to implement the rules, but sometimes it doesn't and they must comply anyways. That's called an unfunded mandate. Or as I like to call it, an un-fun mandate. Because no money, no fun. A good example of example of this is OSHA regulations that employers have to follow. States don't like these, and Congress tried to do something about them with the Unfunded Mandates Reform Act or UMRA, but it hasn't really worked. In the early 21st century, Americans are basically living under a system of cooperative federalism with some areas of activity that are heavily regulated. This is a stretch from the original idea that federalism will keep the national government small and have most government functions belong to the states. If you follow American politics, and I know you do, this small government ideal should sound familiar because it's the bedrock principle of many conservatives and libertarians in the US. As conservatives made many political inroads during the 1970s, a new concept of federalism, which was kind of an old concept of federalism, became popular. It was called, SURPRISE, New Federalism, and it was popularized by Presidents Nixon and Reagan. Just to be clear, it's called New Federalism not Surprise New Federalism. New federalism basically means giving more power to the states, and this has been done in three ways. First, block grants allow states discretion to decide what to do with federal money, and what's a better way to express your power than spending money? Or not spending money as the case may be. Another form of New Federalism is devolution, which is the process of giving state and local governments the power to enforce regulations, devolving power from the national to the state level. Finally, some courts have picked up the cause of New Federalism through cases based on the 10th Amendment, which states "The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people." The idea that some powers, like those police powers I talked about before, are reserved by the states, have been used to put something of a brake on the Commerce Clause. So as you can see, where we are with federalism today is kind of complicated. Presidents Reagan, George H.W. Bush, and Clinton seem to favor New Federalism and block grants. But George W. Bush seemed to push back towards regulated federalism with laws like No Child Left Behind and the creation of the Department of Homeland Security. It's pretty safe to say that we're going to continue to live under a regime of cooperative federalism, with a healthy dose of regulation thrown in. But many Americans feel that the national government is too big and expensive and not what the framers wanted. If history is any guide, a system of dual federalism with most of the government in the hands of the states is probably not going to happen. For some reason, it's really difficult to convince institutions to give up powers once they've got them. I'm never giving up this power. Thanks for watching, I'll see you next week. Crash Course Government and Politics is produced in association with PBS Digital Studios. Support for Crash Course US Government comes from Voqal. Voqal supports non-profits that use technology and media to advance social equity. Learn more about their mission and initiatives at Voqal.org. Crash Course is made with the help of these nice people. Thanks for watching. You didn't help make this video at all, did you? No. But you did get people to keep watching until the end because you're an adorable dog.
Cooperative federalism versus cooperative individualism
Cooperative federalism has been one side in the historical debate in cooperative economics between cooperative federalism and cooperative Individualism. In an Owenite village of co-operation or a commune, the residents would be both the producers and consumers of its products. However, for a cooperative, the producers and consumers of its products become two different groups of people, and thus, there are two different sets of people who could be defined as its 'users'. As a result, we can define two different modes of cooperative organisation: consumers' cooperatives, in which the consumers of a cooperatives goods and services are defined as its users (including food cooperatives, credit unions, etc.), and producer cooperatives, in which the producers of a cooperative's goods and services are defined as its users (which includes worker cooperatives, agricultural producer cooperatives, for example), as advocated by cooperative individualism.
In this debate, cooperative federalists are those who support consumers' cooperatives, and those who favor producers cooperatives have been pejoratively labelled ‘individualist' cooperativists by the federalists.[4][5]
Cooperative federalism
Cooperative federalism is the school of thought favouring consumers' cooperative societies. The cooperative federalists have argued that consumers' cooperatives should form cooperative wholesale societies (by forming cooperatives in which all members are cooperatives, the best historical example being the English CWS) and that these federal cooperatives should undertake purchasing farms or factories. They argued that profits (or surpluses) from these CWSes should be paid as dividends to the member cooperatives, rather than to their workers.[6]
What consumers’ cooperation does
Below is an account of: ‘What Consumers’ Cooperation does,’ excerpted from the May, 1934, issue of Cooperation, which provides an outline of cooperative federalist thought:
- Consumers' Cooperation is the Economic System necessary to match the Age of Automatic Power Production. It is a democratic economic system based on "cooperation for use" and not "competition for profit." It is the Economy of Abundance instead of Scarcity. These are some of its proven Principles and Practices—which really make "life, liberty and the pursuit of happiness" possible for ALL.
- Consumers' Cooperation means Consumers' Ownership and Control. In as much as consumers furnish the market, which is the most essential thing in an economy of abundance, organized consumers must have the ownership and control of the means of production and distribution so that they can regulate production to their needs of consumption, can supply themselves with pure products without adulteration, and do so without competitive wastes in the processes of production and distribution.
- Consumers' Cooperation is Economic Democracy. Consumers, who are everybody, become the owners. Voting is by person and not by property -- one person, one vote. Proxy voting is eliminated -— members must attend meetings and be active. Membership is open to everyone. We now have management control largely in industry, not even stockholder control. Under a cooperative system consumers control and the management executes their will.
- Consumers' Cooperatives Distribute Profits Justly. So-called profits, which in cooperatives are really overcharges or savings, are paid back to the consumer-member-owners on the basis of purchases, as patronage refunds. Those who produce the profits get them in proportion to the contribution they make towards them by their purchases. John T. W. Mitchell, the great leader of the C.W.S. says, "Those who pay the profits should get them back."
- Consumers' Cooperation results in Security -— not Speculation. Capital is hired at the lowest cost. A minimum rate of interest is paid. There are no excessive earnings for investors so there is no watering of stock to cover them up. Stock cannot be sold at more than par value. Consumers' cooperatives require no governmental stock market security regulation because there is no speculation in cooperative stocks.
- Consumers' Cooperation Increases the Income of Every Consumer-Member. A 10% patronage refund on regular retail prices means one ninth more food, goods and services.
- Consumers' Cooperatives Pay Fair Salaries. They are large enough to secure trained experts for managing large scale industry, but not excessive, as under the present management control of corporation policies and payrolls.
- Consumers' Cooperatives Abolish Secrecy. Whatever cannot survive in the open in a democracy is wrong. Balance Sheets. Profit and Loss Statements and every other figure and fact are open to consumer-member-owners in a cooperative. It is the business of all.
- Consumers' Cooperatives Strive for Cash Business, not Credit. Credit was said by one of the men who organized the first Rochdale Cooperative in England to be "The invention of the Devil." The only real reasons for credit business are competition for customers and inequality in the distribution of wealth, both of which cooperation eliminates. Under Consumers' Cooperation the money you invest buys a stock of goods which is carried on hand. The cash you then pay for each purchase enables the inventory to be replenished, ready for you the next time you need it.
- Consumers' Cooperation Produces Pure Food and Goods, not shoddy products nor poison for profit. There is no reason for adulteration when consumers own their own business and buy for themselves. Deception is the result of the attempt to make more private profit for a few owners. Under cooperation the truth can be told in advertising and over the counter.
- Consumers' Cooperation Prevents Waste and Produces True Economy. Duplicated milk wagons, delivery trucks, and all the wastes of competitive factories and distribution systems organized as a result of the urge for private profits are eliminated under cooperation. These wasted hours of working time can be saved and used for real culture and recreation and not for fighting one another like barbarians—even though today -men use gloved hands to grab the most.
- Consumers' Cooperatives Promote Peace. They are the necessary economic foundation to prevent war, which is caused by competition for markets to dispose of the surpluses that capitalism cannot distribute among the workers who produce the food and goods. Cooperatives remove the barriers to trade.
- Consumers' Cooperative Ownership and Control of Industry is the Key that we must adopt to open the door of Plenty for All. It will distribute the piled up surpluses which automatic power driven machinery has produced.
- Consumers' Cooperative Organization Gives the People Ownership, which Workers' Organizations do not. We have thought of ourselves as producers and organized into occupational groups. "For a century and a half," says Professor Fairchild, who wrote the book "Profits or Prosperity," "we have been trained to think of ourselves as producers instead of as consumers -- one of the most remarkable instances of inverted logic on a large scale that mankind has ever displayed." Organizing as producers is, as Beatrice Webb says, organizing the servant side of our lives, while organizing as consumers is organizing as masters of our lives. George W. Russell says, that when we organize as producers and not as consumers we are like an army that gives back to the enemy all it has won at the end of each week. Organizing as producers only is "fighting with one hand behind our backs." Organizing as consumers into Cooperatives will give us ownership and real power. The dollar we spend is more powerful than the dollar we get.
- Consumers' Cooperative Organization Gives Us Democratic Liberty with Economic Justice which Political State Organizations Do Not. Political State organizations suppress liberty.—they are compulsory. Consumers' Cooperation gives us economic democracy—it is voluntary. While we are getting economic justice we must also have democratic freedom.
- Consumers' Cooperation will Complete the Struggle for Liberty and Justice for ALL. We have deceived ourselves into thinking that religious, educational and political liberty were really possible without economic liberty and justice. Now we know they are not. Consumers' Cooperation finally fulfills liberty and justice for ALL. It gives every consumer equality in the control of business. It is democracy in our economic life.
References
- ^ Gide, Charles; as translated from French by the Co-operative Reference Library, Dublin, "Consumers' Co-Operative Societies", Manchester: The Co-Operative Union Limited, 1921
- ^ Lambert, Paul; as translated by Létarges, Joseph; and Flanagan, D.; “Studies in the Social Philosophy of Co-operation”, (originally published March 1959), Manchester: Co-operative Union, Ltd., 1963.
- ^ Potter, Beatrice, "The Co-operative Movement in Great Britain", London: Swan Sonnenschein & Co., 1891.
- ^ Lewis, p. 244.
- ^ This analysis is based on a discussion by Gide, Charles; as translated from French by the Co-operative Reference Library, Dublin, "Consumers' Co-Operative Societies", Manchester: The Co-Operative Union Limited, 1921, pp. 192-203.
- ^ This analysis is based on a discussion by Gide, Charles, pp. 192-203.
This page was last edited on 26 July 2022, at 22:57