Income equality is getting worse. Can the co-op model solve this problem?
Co-ops are more pervasive than you think. They just suffer from a marketing problem.
- The cooperative model accounts for $154B every year in America.
- America leads the world with cooperatives, with over 30,000 businesses operating under this model.
- Co-op advocate Nathan Schneider believes this model can help level the economic playing field.
What is a Co-operative?
Nathan Schneider plays a game at strip malls. The activist-journalist and University of Colorado Boulder media studies professor tries to guess how many businesses were directly or indirectly inspired by co-ops. The number is higher than you'd expect.
Whether it's organic food or fair trade coffee or Visa labels in the windows of the small business or chains like Dairy Queen and Best Western, cooperatives are built into their model.
Reading Ours to Hack and Own, a book on the cooperative tradition that Schneider co-edited, I learned that the nation with the largest number of cooperatives is right here. America has over 30,000 businesses built under this model. Co-ops account for $154 billion every year in the U.S. I met Schneider because I too work for one, and during our talk he educated me on the vast influence of cooperatives on American businesses, a fact I had never stopped to contemplate.
While there are a number of variables in the cooperative model, the basic principles, followed by co-ops around the world, were created by the Rochdale Society of Equitable Pioneers in 1844:
- Voluntary and open membership
- Democratic member control
- Economic participation by members
- Autonomy and independence
- Education, training, and information
- Cooperative among cooperatives
- Concern for community
The Next Economy: Worker-Led, for Public Interest
According to Worldwatch Institute, in 2012 one billion people around the planet were part of a cooperative. The 300 largest co-ops are worth $2.2 trillion. Dating the cooperative model to an origin point is impossible since tribes generally worked under this model. The problem, Schneider says, is that players in the capitalist model take credit for the work that cooperatives have done. For example, credit cards.
Visa, he says, was originally Bank Americard. This early Visa credit card, founded in 1958, was not working under the guidance of Bank of America. A decade later, Dee Hock founded a network of banks that ran under the cooperative model.
That was what made the credit card phenomenon really work. After the cooperatives built that industry, it got demutualized, privatized, turned into this kind of rapacious and exploitative industry. But it was actually the cooperative movement that enabled that feature of capitalism to grow.
While researching his latest book, Everything for Everyone, Schneider discovered his grandfather, a "farm boy from Colorado," was the director of a large national purchasing cooperative in the hardware industry. Growing up, he knew his grandfather ran a company called Liberty Distributors; he just didn't know it was a co-op. This is a persistent problem with co-ops, Schneider says. Few people, for example, know that large companies like Land O'Lakes, ShopRite, and ACE Hardware are co-ops. The most publicized, REI, is predominantly reserved for outdoor fanatics.
Whereas the co-op model might inspire thoughts of conformity, Schneider argues that it actually promotes individuality through participation. Regional cooperatives match the environment in which they are founded and service, whereas chain stores demand subservience from customers. It might seem convenient that I can go into a Home Depot anywhere in America and know where everything is shelved, but this mindset is antithetical to the co-op model.
Liberty was all about using the cooperative model to enable local stores to be more individualistic, to actually enable them to have more control over how they branded themselves and what stock they carried. The hardware store in my town that's a member of ACE Hardware is much more tailored to the culture of the town than the Home Depot conglomerate down the road. The corporate model expects a kind of mass conformity; the cooperative model is a strategy for enabling businesses to help people be their fuller selves.
Corporate responsibility? Don’t make me laugh.
This model can help level the economic playing field in a country like America, which is suffering from staggering income inequality. While Schneider's grandfather never became super wealthy, he was actively engaged in a community in which the rewards of the profession were distributed equitably. Self-help books about economic empowerment and business success proclaim that anyone can become the next Steve Jobs or Bill Gates with a dream and drive, but Schneider recognizes such a promise as nonsense. The capitalist playing field is limited to few winners while forcing small businesses—the romantic 'Main Street' model of suburban America—to shutter their windows.
Schneider points out that even in a time of extreme party-line politics, the Main Street Employee Ownership Act, which argued for employee ownership through a cooperative model, received bipartisan support when signed into law in August 2018. While Schneider says that Republicans are more likely to work with electrical and agricultural co-ops in rural states, both parties need to better educate themselves on the history and importance of this model moving forward. Unfettered capitalism espoused by paid lobbyists is not doing the citizenry any favors.
This is especially problematic, Schneider says, during a time when so much wealth is locked into smaller technology companies that are poorly understood by government.
We have an incredibly widespread accountability problem. Our businesses, especially the dominant ones, are just not accountable the way we need them to be. We can drag them in front of Congress as many times as we want, but they're clearly on their own agenda; we need a different strategy. And another difficulty here that we're in is that we're no longer in the realm of national companies. We need governance that is transnational; we can't just rely on a hodgepodge of national regulations to deal with the emerging digital economy.
Honoring value creators is the way to move forward, according to Schneider. One thing is certain: we're currently not headed in that direction. Empowering members and consumers instead of treating them as a flock will benefit the greatest number of people. Forty years into the trickle-down experiment have shown its utter failure. When will we come to terms with this fact?
What would happen if you tripled the US population? Join Matthew Yglesias and Charles Duhigg at 1pm ET on Monday, September 28.
The idea of 'absolute time' is an illusion. Physics and subjective experience reveal why.
- Since Einstein posited his theory of general relativity, we've understood that gravity has the power to warp space and time.
- This "time dilation" effect occurs even at small levels.
- Outside of physics, we experience distortions in how we perceive time — sometimes to a startling extent.
Physics without time<p>In his book "The Order of Time," Italian theoretical physicist Carlo Rovelli suggests that our perception of time — our sense that time is forever flowing forward — could be a highly subjective projection. After all, when you look at reality on the smallest scale (using equations of quantum gravity, at least), time vanishes.</p><p style="margin-left: 20px;">"If I observe the microscopic state of things," writes Rovelli, "then the difference between past and future vanishes … in the elementary grammar of things, there is no distinction between 'cause' and 'effect.'"</p><p>So, why do we perceive time as flowing <em>forward</em>? Rovelli notes that, although time disappears on extremely small scales, we still obviously perceive events occur sequentially in reality. In other words, we observe entropy: Order changing into disorder; an egg cracking and getting scrambled.</p><p>Rovelli says key aspects of time are described by the second law of thermodynamics, which states that heat always passes from hot to cold. This is a one-way street. For example, an ice cube melts into a hot cup of tea, never the reverse. Rovelli suggests a similar phenomenon might explain why we're only able to perceive the past and not the future.</p><p style="margin-left: 20px;">"Any time the future is definitely distinguishable from the past, there is something like heat involved," Rovelli wrote for the <a href="https://www.ft.com/content/ce6ef7b8-429a-11e8-93cf-67ac3a6482fd" target="_blank"><em>Financial Times</em></a>. "Thermodynamics traces the direction of time to something called the 'low entropy of the past', a still mysterious phenomenon on which discussions rage."</p>
The strange subjectivity of time<p>Time moves differently atop a mountain than it does on a beach. But you don't need to travel any distance at all to experience strange distortions in your perception of time. In moments of life-or-death fear, for example, your brain would release large amounts of adrenaline, which would speed up your internal clock, causing you to perceive the outside world as moving slowly.<br></p><p>Another common distortion occurs when we focus our attention in particular ways.</p><p style="margin-left: 20px;">"If you're thinking about how time is <em>currently</em> passing by, the biggest factor influencing your time perception is attention," Aaron Sackett, associate professor of marketing at the University of St. Thomas, told <em><a href="https://gizmodo.com/why-does-time-slow-down-and-speed-up-1840133782" target="_blank">Gizmodo</a></em>.<em> "</em>The more attention you give to the passage of time, the slower it tends to go. As you become distracted from time's passing—perhaps by something interesting happening nearby, or a good daydreaming session—you're more likely to lose track of time, giving you the feeling that it's slipping by more quickly than before. "Time flies when you're having fun," they say, but really, it's more like "time flies when you're thinking about other things." That's why time will also often fly by when you're definitely <em>not</em> having fun—like when you're having a heated argument or are terrified about an upcoming presentation."</p><p>One of the most mysterious ways people experience time-perception distortions is through psychedelic drugs. In an interview with <a href="https://www.theguardian.com/books/2018/apr/14/carlo-rovelli-exploding-commonsense-notions-order-of-time-interview" target="_blank"><em>The Guardian</em></a>, Rovelli described a time he experimented with LSD.</p><p style="margin-left: 20px;">"It was an extraordinarily strong experience that touched me also intellectually," he said. "Among the strange phenomena was the sense of time stopping. Things were happening in my mind but the clock was not going ahead; the flow of time was not passing any more. It was a total subversion of the structure of reality."<br></p><p>It seems few scientists or philosophers believe time is completely an illusion.</p><p style="margin-left: 20px;">"What we call <em>time</em> is a rich, stratified concept; it has many layers," Rovelli told <em><a href="https://physicstoday.scitation.org/do/10.1063/PT.6.4.20190219a/full/" target="_blank">Physics Today</a>.</em> "Some of time's layers apply only at limited scales within limited domains. This does not make them illusions."</p>What <em>is</em> an illusion is the idea that time flows at an absolute rate. The river of time might be flowing forever forward, but it moves at different speeds, between people, and even within your own mind.
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