“Bolivar and cooperativism” by Professor Carlos Molina Camacho

Professor Carlos Molina Camacho
“Bolivar and cooperativism” by Professor Carlos Molina Camacho, former National Superintendent of Cooperatives, Professor of Post Graduate courses in Cooperative Law at the Central Venezuela University (UCV). Member of the Bolivarian Society of Venezuela. Author of several books on cooperatives and of BOLIVARIAN VALUES FOR THE YOUTH OF THE 21st CENTURY. Watch the video. Listen to the audio file in English or audio file in Spanish. – Read the original Spanish presentation.

[Translation of his presentation at the First Global Prout Conference in Venezuela, “Building a Solidarity Economy based on Ethics and Ecology”, July 7-9, 2011, Caracas. Due to lack of time, Professor Carlos Molina Camacho could not finish his speech. His full presentation is here.]

According to the distinguished Jesuit priest José Martinez Terrero, (“COOPERATIVAS EN VENEZUELA”, Fondo Editorial Común, Caracas 1972, p.34), General Eleazar Lopez Contreras, during his presidential administration (1936-1941), “mandated the promotion of cooperatives in the Bolivarian Society of Venezuela,” a move which, according to him, “constitutes one of the most effective means of realizing the political tenets of ‘The Liberator’ (Simón Bolívar).”

In his own book called “THE THOUGHTS OF BOLIVAR THE LIBERATOR” (Editorial Arte, Caracas, 1963), General López Contreras recounts that when he was invited to the constitution of the Bolivarian Society of Medellin, Colombia on July 24th, 1946 , he said the following:

“When the Bolivarian Society of Caracas was formed in 1938, in an official capacity, the new statutes deemed that the Center was authorized to organize cooperatives … thus trying to materialize, as it has been said, the thoughts, the spirit and the humanitarian awareness of the Father of the Nation.”

In turn, Dr. James Daly Guevara, in his book “FINANCIAL RESOURCES OF COOPERATIVES IN THE COOPERATIVE LAW OF VENEZUELA” (Mobil Books, Caracas, 1998, p.20) notes that “Major General Eleazar Lopez Contreras, shortly after assuming the Presidency of the Republic, charged his fellow members of the Bolivarian Society with the mission to promote cooperatives and provided them with the incredible sum at the time of Bs 5,000,000.

Thanks to this initiative, Dr. Antonio Fabra Rivas, a noted expert in the field, was brought from Spain as an advisor for the cooperative development plan, and he also provided assistance in the preparation of the Cooperative Societies Act of 1942, inspired by Mexican law.

PROFESSOR SALCEDO BASTARDO AND THE SOCIAL VISION OF THE LIBERATOR

Dr. José Luis Salcedo Bastardo, in his work “VISION AND REVIEW OF BOLIVAR” (Monte Avila Editores, Caracas, 1981) recalled that in Bolivar, the social, the collective, and the communal, always prevailed over individualism or group interests.

See the following statements of the famous Bolivarian writer:

*** “With the distribution of land, together with its corresponding egalitarian zeal, Bolivar begins a socio-economic revolution in the hemisphere.”

*** “Bolivar has a clear concept of the production unit or the economic unit, and anticipates the modern system of collective farms, allowing many recipients to join a community to apply for the larger farms. Such tacit opposition to small land holdings underscores his revolutionism: he wants to prevent small farms, opening possibilities for large-scale capitalist production and wage labor. ”

*** “Bolivar takes the social aspect into consideration. At once he thinks of justice and the convenience of taking advantage of idle lands and avoid the fragmentation of large units. ”

*** “Although Bolivar arises when historic individualism still dominates, and collectivism is just dawning, his thoughts transcend every personal nuance to take on a frank collectivist tone.”

*** “He wields his collective history against political individualism. In every case, his ideology is the popular ideology; his aspirations are always democratic aspirations. In his political work there are no hesitations: the preferential treatment is to society, his highest concern is for the nation. Bolivar said: “I always put the community before individuals.”

*** “In the realm of economics Bolivar aims to replace the agrarian structure of slavery with the wage system of the monetary regime; he works for justice in the distribution of goods; he points to economic independence for the distribution of land to the ones who work it; this is placing the means of production in the hands of its true agents. ”

BOLIVAR PRIVELEGED THE COMMUNITY OVER THE INDIVIDUAL

There is no doubt, then, that for the Liberator, the social and the collective prevails over the individual. Slavery was in full swing in his time. Then later on, it changed from slavery to salary work, where man was no longer a mere object to be bought and sold, but now able to negotiate his physical and mental strength with employers. This was, of course a major step, a social improvement, clear progress.

Even in his time, and whenever it was feasible, he supported the collective work of the land, so that it would be done on equal terms and that the economic benefits of the work would be fairly distributed.

Knowing, therefore, that Bolívar possessed a revolutionary spirit, and that he was progressive, advanced, and inclined towards social and community matters, we can be confident that today he would support without hesitation a cooperative system, so far removed from capitalism and statist bureaucracy.

Therefore, General López Contreras, being so knowledgeable about the Bolivarian doctrine and about cooperatives, persuaded these popular, self-managing companies to embody the political, social and moral desires of the Liberator.

Hence his insistence that the Bolivarian Society, an institution that he considered to be a corporation of a public nature – his own government was merely a private organization – to promote cooperatives in Venezuela. We must appreciate the visionary spirit within this military and political homeland, no doubt, and especially his desire to move from mere bolivarian rhetoric to the creation of social institutions that embody true bolivarian values.

BASIC FEATURES AND DIFFERENT TYPES OF COOPERATIVES

Cooperatives are essentially economic enterprises that are popular in nature, based on self-management, human solidarity and the absence of excessive profit, among other values.

They are created to produce goods or services or to acquire them. Above all, they are organized as worker-owned companies. All of the workers, whether providing manual or intellectual services, are collective owners of the company. At the same time, the workers are the owners of the capital of the company. The earnings are distributed equitably among the worker/owners in proportion to the work they performed for the cooperative.

There cannot be equity shareholders who do not provide their services to the cooperative. As a general rule, but with some exceptions, there can no paid employees. Those who work for the cooperative should therefore be an associated member and should have contributed to the initial capital formation of the company.

All of these cooperatives, of handicraft, industrial or agricultural production, or even service cooperatives, are authentic work communities. They dignify the worker, who is no longer a mere paid employee of the owners of capital, but who is him or herself an owner, together with their peers, of the sources of their work. Finally they have been liberated!

Cooperatives that are formed to obtain goods or services, organize themselves economically with users and consumers who, in this way, manage to acquire goods or services that have been provided for a fair price, without excessive profit, without speculation, without unnecessary intermediaries.

Being businesses like any other, the latter cooperatives must operate with the criteria of profitability. If there are economic gains they are distributed at the end of the fiscal year among the members in proportion to their purchases or transactions within the cooperative, or they are invested for the expansion of the cooperative, in order to deliver more and better services to its members.

Normally, in order to purchase a good or receive a service from this type of cooperative, you must join it and become a member, even though there are also so-called open cooperatives, where non-members can purchase goods or services at prices that are obviously lower than the market. In the latter case, buyers or simple customers do not participate in the annual distribution of benefits and have no influence in the running of the cooperative.

However, the economic benefits derived from the transactions with these non-associated people are not distributed among the members of the cooperative, because then there would be excess profit, but instead will be added to the common development funds, for training and cooperative education, that the organization would have created.

THE ORGANIZED COOPERATIVE MOVEMENT WAS BORN IN 1844 IN ENGLAND

The cooperative movement or the cooperative system of economics was born in 1844 in Rochdale, England, a small town near the industrial city of Manchester. It is different, as we have said, from both capitalism and state socialism because of the principles that guide it.

Capitalism is based on private, profit-driven companies that either produce or distribute goods or services. Such enterprises are run by the owners of capital. In regards to participation in the management of these companies and company ownership, there is no involvement by the workers, nor the consumers, nor the users.

Therefore, the economic democracy of cooperatives is absent in capitalism. Profit is the prime engine of the capitalist economy and generally it gets caught up in detestable excesses: speculation in regards to consumers and users, and blatant exploitation of workers.

STATE SOCIALISM OR BUREAUCRATIC FAILURE

By its own accord, state or bureaucratic socialism failed, as it is well known, because the state tried to claim ownership of nearly the entire the economy of a country, completely ignoring the laws of the market and establishing a political regime characterized by the absence of freedom.

We believe that President Lopez Contreras was absolutely right. If Simon Bolivar were alive today, we believe that he would support a system like the cooperative system – which in reality, is nothing more than socialism that is democratic, participatory and self-governed – because it is based on values ​that he preached and practiced, which were: 1) social justice, 2) freedom, 3) participation, 4) solidarity, 5) the spirit of service and not of profit, 6) education, 7) individual and community responsibility, 8) preeminence of the collective over the individual, 9) political, religious, racial, and social neutrality 10) unity and universality.

THE UNIVERSALITY OF COOPERATIVISM

Regarding this last point, of unity and universality, we must say that cooperative organizations exist in all the countries of the world, forming the so-called cooperative sector. The International Cooperative Alliance, a global institution that brings together cooperatives from around the world, and which is based in Geneva, Switzerland, estimates that there are 850 million members of cooperatives throughout the world. There is no doubt that this figure is likely to grow in the near future, since it is widely believed that cooperatives are able to achieve, like no other, the reconciliation of social justice and freedom.

COOPERATIVES IN VENEZUELA

In Venezuela, the cooperative movement began to consolidate itself beginning in 1958, following the ousting of the Perez Jimenez dictatorship. In our country, this movement of popular businesses has been active in almost all areas of the economy, while having excelled in the field of services. Cooperatives own and operate the nation’s largest private network of funeral services, and with its food and household item fairs, especially in the central part of western Venezuela, it has helped consumers save billions of Bolivares, fighting head-on the speculation of common food items.

The current administration, convinced that cooperatives truly embody the Bolivarian ideals in the area of ​​the economy, brought about the enactment of a new law that governs these popular socio-economic entities. Thus, as of 2001, we now have the Special Law of Cooperative Associations, and it has been providing great support to these enterprises, in particular the work or production cooperatives, that fall within the so-called New Cooperativism. Similarly, the Bolivarian Constitution of the Republic of Venezuela contains several regulations that commit the State to the promotion of cooperatives (arts. 70, 118, 184 and 308).

However, it should be mentioned that in recent years there have been serious errors in the promotion of cooperatives. The training and education of cooperative members has not been sufficiently stressed, so many associations have been constituted that are only cooperatives in name, since its members are not even familiar with the most basic principles and values ​​of the cooperative system of the economy.

Not surprisingly, once granted an official loan, often of a large sum, the organization and its members disappear, wasting the money that unfortunately belongs to all Venezuelans, and above all, committing irreparable damage to the cooperative ideal. All of this was the result of a hasty promotion strategy, that was not well-planned, although in principle there may have been a laudable desire on the part of the current administration to increase the number of these popular self-managed enterprises.

THE NATIONAL SUPERINTENDENCY OF COOPERATIVES (SUNACOOP)

The National Superintendency of Cooperatives (SUNACOOP) is an organism with a very low budget, and on top of that, it is responsible for both education and fiscal control of these enterprises, and it is not doing a very good job of either, despite the high sense of duty of government officials.

I and others believe that SUNACOOP should be, like other offices, an auditing and supervising entity. We believe that another national institution should be created to work exclusively in the education and training of cooperativists, as well as to do research in this field. They should publish mass literature on the subject, organize conferences and conventions, use the public and private mass media to deliver the cooperative message, etc. This institution should be led by the government as well as by the national cooperative movement.

The 306,792 cooperatives that have been registered (Report and Account of the Ministry of Communities and Social Protection of 2010) are poorly supervised, and therefore, the vast majority of them operate without integration, without unity between one another, breaking one of the essential principles of cooperativism, which is integration at all levels: local, regional, national and international.

The time has come to take a pause on our path, to evaluate what has been done so far. To reinforce the positive things that could have been achieved and to eliminate the many mistakes that were made while trying to promote cooperatives during the decade and a half of the current administration.

In the words of the specialist, Professor Oscar Bastidas-Delgado (UCV), a veritable graveyard of cooperatives has been created, since it is estimated that only 10% of those that were formed – as we have said, the 306,792 – are still functioning, which has not stopped being a very negative balance.

In his most recent work, entitled “HAVE COOPERATIVES FAILED?”, Mr. Luis Delgado Bello, also an expert in cooperatives and a former National Superintendent of Cooperatives, asserts the following: “No, cooperatives have not failed. What failed was a way of promoting and implementing a policy that did not understand the deep sense of the cooperative reality and committed grave mistakes in their action. But thousands of cooperative processes continue to develop, propelled by their essence of solidarity, with flaws, but also with outstanding successes that are recognized by both citizens and foreigners, within and outside of Venezuela.”

THE IMPORTANCE OF EDUCATION AND TRAINING FOR COOPERATIVES

Hence the immense importance that we must give to cooperative education and training, so that cooperatives that are organized from now on, whether producing or distributing goods or services, always operate in the best conditions of efficiency and profitability.

Certainly, up until now, the administration of President Chavez has favored the creation of worker cooperatives or production cooperatives of goods or services, relegating to the background the formation of consumer or user cooperatives, such as those that would be for the consumption of food and other products, housing, savings and loan associations, health services, education, cooperative schools, etc. In the latter cooperatives, children and young people would learn at a young age to practice the values ​​of cooperation, so different from the characteristics of capitalism that are based on profit and the exploitation of people.

Why are some of the Mercal government stores selling subsidized food not converted into consumer cooperatives? These stores could be managed not by state, but by the same community where they operate and where the cooperative members are able to see the need to contribute to building up the enterprise’s capital, even with modest contributions. Perhaps there would be fewer irregularities in the management of the stores from what we observe today and thus they would be practicing true participatory democracy.

Members of the new organizations must understand their rights and obligations, as well as the structure and operation thereof, in order to become fully aware that they are within a system that requires, as a sine qua non for success, the active participation of all partners, be they workers, consumers or users, in the various activities of their companies.

Similarly, it is necessary that these new cooperatives do not merely become instruments of the present political administration or those that will come in the future. It must be assured that these associations will not lose their autonomy and independence for seeking credit or technical assistance from state agencies. It must be forever remembered that they are businesses, and therefore must operate under the same criteria of economic profitability. Any other criteria that they administer can lead them to total collapse.

AREA OF THE SOCIAL, SOLIDARITY OR PARTICIPATORY ECONOMY

We are persuaded, therefore, that a strong cooperative sector in the economy, together with industries related to its philosophy, which could be included within the so-called Social, Solidarity and Participatory Economy (savings and loan associations, social security institutions, economic civil associations, benefit societies, funds, etc), would assist in the reorganization of our Latin American societies, making them more egalitarian, more participatory, more fair, and therefore more free.

Of course, we cooperativists do recognize the presence of private, for profit, and public sectors in the economic landscape of any country, but we also advocate for the democratization of these sectors, with the aim that the workers, as with the consumers and users, have an increasingly larger participation in the administration and a larger share in the benefits of the companies that make up these sectors. It is a question of deepening economic and social democracy, without which, political democracy alone becomes unable to provide comfort and happiness to our people.

May we, the Venezuelans of this moment, be pioneers in Latin America of a new socio-economic order, which, in respecting the laws of the market, and without ignoring the regulatory role of government in the economy, will make it possible to build in our region a society where, finally, justice can be reconciled with freedom, as our Liberator Simon Bolivar so desired.

Do not forget that it was Venezuelans who in the last century created a new political order in Latin America. Through our veins circulate the seeds of renewal, of change, of revolution. We have always been found at the forefront of major historical changes that have occurred in our continent.

And what can be said of cooperativism, in terms of the support Bolivar would give them if he were living among us today, could equally be said of all those intermediate entities that exist between the individual and the state, that are not profit-driven and seek to organize the people to find solutions to the many problems afflicting them. For example, the community councils, consumers boards, neighborhood associations, condominium boards, health organizations, cultural groups, sports clubs, etc. as they are in fact based on the Bolivarian values of participation in freedom.

As Simón Bolívar said: “Patience and more patience, perseverance and more perseverance, work and more work to make a country.”
[Translated by Spencer Bailey]
Panel 3 questions and answers.

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