What is the future of Europe? A co-operative contribution

The best way to move forward is to look ahead. That is the rationale for a consultation launched by the European Commission on the back of a recent White Paper on the Future of Europe.

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Co-operatives were involved at the start and at the heart of the European project. The Commission White Paper starts by saying that Europe was once the future, pointing to the inspiration of the Manifesto di Ventotene, co-written by Ernesto Rossi while he was held prisoner by fascist authorities in the Second World War.


Rossi was the founder and member of a co-operative, and its exchanges were core to his ideas.


So the Manifesto calls for a free and united Europe, as the Commission White Paper points out. But the Manifesto also goes far further by suggesting how that Europe should be organised – with “industrial reform which will extend workers’ ownership in non-nationalized sectors, through co-operative adventures, employee profit-sharing, and so on.” This Europe is still the future.


Co-ops are big business in Europe of today, with 141 million members and 4.7 million employees. But co-ops are not just business as usual. You will find in the co-operative sector enterprises that are utopian, in the best sense of ventures that challenge the status quo in search of new shores and new worlds.


It was European co-operative enterprises that were first to introduce an eight hour day in factories, the first to champion a minimum wage, the first to give business backing to the idea of national health and welfare services.


If we look at Europe today before looking forward, there are at least three challenges many would point to.


  1. The acute phase of the Eurozone crisis has passed, but the risks in terms of state and banking sector liabilities have not gone away and the legacy continues, with the ILO warning recently of worsening medium-term structural unemployment, even though short-term job numbers are on the rise.


  1. The enlargement of the European Union across Central and Eastern Europe is widely regarded as one of its greatest achievements. At the same time, it has changed the character of the union, including raising levels of intra-EU migration. At a public level, 47% of people say that enlargement has gone ‘too far’.


  1. Migration into Europe, coming out of the conflicts and political instability of the Middle East and North Africa, has also shaped public attitudes. Alongside acts of humanitarianism and openness have been fears and heightened concerns around security, not least with an illiberal drift in some countries of Central and Eastern Europe.


In its own way, each of these has an impact on the underlying values behind the idea of European unity.


Solidarity is a value that is set out as a core objective in the original Treaty of Rome, signed by the founding six countries. A quote from Robert Schuman adorns the Commission White Paper. In May 1950, he said that “Europe will not be made all at once, or according to a single plan. It will be built through concrete achievements which first create a de facto solidarity.”


Solidarity still exists. There is majority support at a public level for example for the idea that richer member states should financially support poorer ones (50% agreement, with only 18% disagreement).


Yet solidarity in Europe is also being eroded. Income inequality has increased in two thirds of EU countries. The Eurozone crisis created a divisive framing of creditor versus debtor countries. And Brexit, lest we forget.


The challenges of the future, including climate risk, automation, skills are ones which will require co-operation to resolve, and solidarity to do so in ways that sustain the dream of European unity.


Like a fractal, the echo of patterns from large to small, co-operative and mutual enterprises – the social economy of Europe – have an insight on these great issues, because we know what sustains voluntary and open co-operation in practice.


Solidarity itself, for example, is one of the six ‘co-operative values’ set out for co-operatives working across Europe. We know that solidarity is fostered and sustained in exactly the way that Schuman describes – through practical action in the name of a common cause.


So, in the spirit of Ernesto Rossi, working through Co-operatives Europe, we are looking to explore the future of Europe through the hopes and dreams of our members.


We have a working group coming together and, to help their work and kick off the dialogue, here are five co-operatives across Europe that I have come across to kick-start our conversation. These are five that offer a radical economic alternative to a failing status quo:


  1. Democratic Technology
    Robin Hood Asset Management Co-operative out of Finland is a new form of financial investment and organizing. Robin Hood Co-op has been described as an “activist hedge fund”, but it is more than that. First, it is a co-operative, operating on the basis of one member, one vote. Second, it is both automated and decentralised, with assets placed in the stock exchange using an algorithm and tracked using blockchain technology. Thirdly, it is about reinvestment on the Robin Hood principle: part of the profit generated by the fund is invested into projects “building the commons.”


  1. Common resources
    The Cooperativa Integral Catalana in Spain has around 850 members that interact through a mutual credit network and a highly developed model of collective decision-making. One of the initiatives linked to this open co-operative is Faircoin, a complementary currency. One of the programmes of the co-operative is designed to move resources from private to common ownership.


  1. Socially useful money
    The Jord Arbete Kapital (“Land Labour Capital”) or JAK Bank in Sweden has been operating since 1965 on the basis of an entirely different model of banking, using interest free banking to serve its 35,000 members, particularly around housing and home improvements. JAK founders in Denmark inspired the development of the Swiss WiR (the ring) in 1934 that today operates as a co-operative bank providing interest-free finance though a mutual credit currency for about one in four small and medium businesses in Switzerland.


  1. Low carbon economy
    The German Sparkassen and Genossenschaftsbanken (co-operative banks), such as DZ Bank, with twelve thousand branches, are the leaders in using funds from the state development bank, Kreditanstalt für Wiederaufbau (KfW) for Germany’s carbon reduction programmes. KfW provides capital at 1% to DZ and other banks for on-lending. Since 2001 more than 2.5 million homes have been upgraded to high-energy savings standards.


  1. Integration
    Cooperativa Impresa Sociale Ruah is a social co-operative in Bergamo, Northern Italy. The co-op works with refugees, providing and working on housing, work, literacy, education, training and integration issues. In one year, according to the ILO, Italian social cooperatives like RUAH provided 18,000 refugees, asylum seekers and migrants with support and integration services, working out of 220 welcome centres.


To these five, many more could be added. Just remember, the only qualification to make, is that utopian ideas are about possibilities and not predictions for the future. The way to move forward is not just to look ahead, but to set steps, our direction, towards our chosen destination.


The reason why these co-operative possibilities are important is because as hard as alternatives may seem – whether tax reform, land reform, monetary reform or banking reform – the status quo is simply impossible.


In terms of climate change alone, the greenhouse gases that are forcing temperature rises stick around longer than we do. If we want to level off at no more than two degrees, then we have a choice.  We can grow the economy, or we can cut emissions and try and do so rapidly. It is increasingly clear that we can’t do both.


The big economic choices of our day are for an economy of prevention, a great transition to low carbon living within limits, or one of adaptation, a great disruption of coping, survival and loss.


We hide behind the idea that it might not happen; that resource efficiency means that we don’t have to choose; that the pace of technology development and innovation will save the day. But with resource efficiency, when people save money, they spend it elsewhere, typically redistributing rather than reducing carbon emissions. It is called the rebound effect. And technology? The futurist Ray Kurzweil reminds us that the pace of technology is accelerating far faster than we assume. We will see, he predicts, innovation over the next ninety years that are equivalent to the last ten thousand. But for now, though, when perhaps it matters most, the thrust of technology change underpins high carbon as much as low carbon economic activity.


The prevailing winds today are ones of intolerance, rather than of solidarity, ones of environmental hazard rather than of sustainability.


Imagination is the most powerful tool that we have for social change. By re-imagining the world around us, we can put it together again in a different way – first in our minds, then in our stories and ultimately in reality.


On September 13th, the European Commission President Jean-Claude Juncker will give his views in the annual State of the Union address.


Lets hope for some signs of co-operative imagination…


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