Category Archives: Poverty

Microcredit, the innovation of the century

 Microcredit, the innovation of the century

René Mendoza Vidaurre *

 

There is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in the introduction of a new order of things.

.

(Niccolo Machiavelli, 1532, The Prince)

 

Grameen Bank (“village bank”) emerged nearly four decades ago in Bangladesh. In 2006 its founder, Muhammad Yunus, received the Nobel Peace Prize “for his efforts in creating economic and social development from below”, achieving world recognition for microcredit. Apart from the criticisms that microcredit pacifies poor families so that they do not fight for their rights, and that the US$130 average amount is not enough to buy a cow, and much less a hectar of land, its achievements are impressive: 3,000 branches, 7 million borrowers (95% are women), and 3% arrears rate; nearly 100% of Grameen children that start their studies finish them; education, health, retirement and pension programs, and services of access to new technology – cell phones in more than 2,000 villages (Grameen Telecom), solar panels (Grameen Skakti) and internet in the villages (Grameen Communications). What made posslbe this change of the century in finances in favor of the poorest of the poor?

Distancing themselves from conventional finance

After years of war, Bangladesh achieved its independence in 1971, a year later Yunus returned to his country as a university professor, and in 1974 the country experienced a great famine. Yunus, his colleagues and students wanted to help, and went to live – and study – in the village of Jobra. There they found usury with interest rates of up to 10%/day, and their dependence on those loans made them live as semi-slaves. In Jobra they counted 42 people under these usurious conditions, and the total loan amount was only US$27. He lent them those US$27 at 0% interest, and to his surprise they paid him back; then he discovered that they were paying interest rates higher than 60%/year to the commercial banks. So he observed something contradictory in the banking system, they were there to give loans, and acted under the principle of “the more you have, the more you get”, but they were exclusive: “when you exclude people for no fault of their own, it is apartheid.” Without the first dollar they could not get the second one, this was the situation of the poor. From there emerged his vision: end poverty.

He requested a loan from the bank to provide “small loans for the poorest.” The banks rejected the request: the poor do not receive loans because they cannot repay them, they do not know how to fill out the forms, and they do not have material collateral. After six months, and after Yunus himself offered collateral, one bank lent him US$300. Yunus and his team organized the credit and recovered up to the very last cent. The manager of the bank attributed this to luck, and when that credit experience was replicated in five, ten and fifty villages, that manager did not change, “because people can make mistakes, but the banking system does not.”

The more he lent, the more they saw the need to found an organization: Grameen Bank (1983) (GB), in order to place the first dollar in the hands of the poorest. What was the motivation for the people to pay and improve their lives?

Microcredit in groups and the social movement

GB followed a path opposed to the logic of the banks and what economics teaches. The bank waits for the client in their offices, requires material collateral, and provides individual loans, high loan amounts, and to people with more resources; it is a system built on the basis of prejudices; “Those who have more resources pay.” GB started microcredit (small amounts), without material collateral, with groups of five people as the basis to build a culture of credit, members with different businesses that mutually support one another, if one member does not pay the rest do not get a loan; the groups meet weekly to pay, save and renew their commitments to 16 norms (have a small family, build latrines, send their children to school, stop the practice of dowries, drink water from healthy sources or boil their water, grow vegetables, vote in elections…); they were mostly women because they were the poorest and those most affected by the purdah norms (conceal women from men who are not direct relatives), because they made better use of the loans and they paid on time. The GB officials stay out in the villages, explaining the microloans and accompanying those that have been disbursed, and because of the role of the groups, the credit and the savings in good measure are administered by the people themselves; the transactions are done in front of everyone. The basis is trust; without lawyers, nor taking people to court for lack of payment.

The novelty is in the learning capacity of GB and in its social movement nature. Yunus and his team immersed themselves from the beginning in order to understand the reality; so they understood the bottleneck of usury, discerned their vision and maintained it. Then they experimented, it if did not work out, they would study the banks to do “just the reverse”; trial and error forming groups with women. These circles remind us of the microfinance institution known as Bora founded by Munro and 50 beggars in Kiberia (Kenya) (“small loans, big changes”), Toyota (“if one worker makes a mistake another worker corrects him”), and Wikipedia (“one writes and others anonymously correct, improve and edit the text”). The key: combining decentralization (circles) and centralization (GB), economics (credit) and social-cultural movement (freeing women from the conservatism of Islam), and personal and social change.

Erosion of microcredit and the imperative to recover its novelty

Thousands of NGOs and microfinance institutions got involved in microcredit since 1980, they even adopted the circles called “solidarity group lending” (SGL). Most of them fell by the wayside, or turned into conventional banks, brandishing the prejudices that GB fought against: “the poor do not pay”, “credit only with material collateral”, “arrears are recovered by lawyers”, “credit is done by people who have studied it”, and “SGL only for recovering the loans.” In spite of the path shown by GB, those who followed, took it and added the microcredit discourse and SGL in the old form of making credit exclusive, and have been “scaling up” to social groups with more resources. Albert Einstein said it well that  “it is easier to split an atom than it is to break a prejudice.”

How can this innovation of the century be recovered? Following the path of Yunus and his colleagues, doing immersion and creating conditions for experimenting. Recognizing that in our countries upward of 70% of the population continues to be excluded from credit, and that they constitute an enormous sector to innovate (e.g. with larger amounts for family agriculture). Rethink SGL as “pressure among themselves to pay”, to believe in themselves, improve their businesses, take on norms like erradicating domestic violence and having sustainable practices. Understanding credit (from the Latin credititus, “having trust”) as the “door” for a strategic alliance between SGL with the poorest organized into associative forms, groups with more resources and better organized, and financial institutions, around financing and social change, and scaling up in that alliance, combining technical assistance and commerce.

Even though the government of Bangladesh has been working to take over GB since 2013, and there are growing criticisms that GB is being dragged along by the market, GB has shown that is can change the world with $27 dollars, and do it bringing the people from the base of the pyramid to a financial system open to learning and to alliances with the poorest of the poor. This can be an initiative that begins “a new order of things”.

* I thank F. Huybrechs and J. Bastiaensen for their comments on the draft of this article.

René Mendoza has a PhD in development studies, is a collaborator of the Wind of Peace Foundation (http://peacewinds.org/research/), an associate researcher for IOB-University of Antwerp (Belgium) and for the Nitlapan-UCA Research and Development Institute (Nicaragua). rmvidaurre@gmail.com

 

When We Learn

I caught a segment on the news today that captured my attention. The piece had to do with the issue of memory loss and whether there are practices we can use to slow down the seemingly inevitable loss of memory that afflicts so many of us.  The discussion included several lifestyle factors which can affect memory strength: exercise, sound nutrition, sufficient sleep, stress control and mental stimulation such as encountered in learning something new.  This last category is the one which struck me with special impact.

I’m not sure how many retirement-age people seek out new fields of learning in their later years, but I suspect that it’s a significant number.  It may not be learning in the sense of a new language or taking up a musical instrument- as suggested in the story- but some retirees are inclined to delve into topics that they never had the time to explore when working vocationally.  The availability of extra time is simply too valuable to leave unfilled.

And what gifts such opportunity provides!  In addition to mental and memory sharpening, learning can  launch the acquisition of new skills, discovery of new outlets of expression, permit an unfolding of a new worldview, and further enrich lives that may have previously been thought to be static.  Even new careers are launched from the base of educational re-birth.  As long as the energy and desire to learn are present, transformation can happen, and at any age.

The recognition is a happy one for someone like me, on the upper fringes of middle age (whatever that is).  But following a week in Nicaragua during which our emphasis again was education development, such awareness exposes an uncomfortable inequity, another one of those troubling realities which has seemingly few avenues for redress and yet massive consequences to us all.  For in Nicaragua, like many other developing nations, access to education is limited, at best, and at every age.

 At the time when Nica children are most eager and receptive to the lessons of life from the neighborhood academy, they are all too often denied entry.  Too many are needed by their families to work in order that living necessities can be met, or they are unable to access a school with books and teachers, or they cannot afford the niggling costs of a uniform and materials.  As a result, rural Nicaraguan children have very small chances of remaining in school past the third grade, and the statistics are not improving. Another generation of so many uneducated children is an enormous burden that the country simply cannot absorb successfully, no matter how strong the optimism or how deep the denial.

Hearing from the StudentsLast week, WPF visited  the  Fe y Alegria vocational school in Somotillo, located in the far west corner of the country.  Like so much of the country, it’s a remote, rural sector, featuring high heat and ever-higher winds, few opportunities outside of “street” jobs, and a place where kids have few chances to learn much about their lives and what they could be.  In fact, most of them come from destitute families or no families at all; the street is not only where they work, but where they live.

The Somotillo Technical School is an oasis in this context, where children ranging from pre-school to high school can be exposed to the possibilities in life, away from the streets.  Young people are introduced to trades like welding, furniture-making, sewing, baking, electricity and computers.  (In one class, I inspected this computer made by the students from old parts.  Could you do that?  On my best day I could not.)  Handmade ComputerAs importantly, they are taught life skills, things like respect and healthy relationships, personal hygiene, lifestyle choices.  But most importantly, the kids are given the chance to absorb what they crave: learning and self-actualization.  Melby, perhaps as old as twelve, said it for himself: “I have done baking from my lessons in

Melby Speaks

the class and it has allowed me to sell and generate a little money for my everyday needs.”  With no one else available to do so, this free school- the only free technical school in the entire region- is helping Melby to learn the basics of self-sufficiency.

Our world requires all the collective knowledge, innovation and insight that we can possibly muster and the under-education of our future generations might be one of the most self-defeating postures ever assumed by humankind.  Issues of poverty and justice, climate change and energy, war and peace, demand intellect and vision beyond what we have at our disposal presently.  The answers to the great dilemmas of humanity may well lie in the untapped mental fertility of those for whom education is a great unknown, a process only to be dreamed of, or perhaps even feared, but never to be personalized.  The notion is frightening enough to conjure a particular vision of Hell, where humans there discover that they had all the answers to life itself within their collective grasp, but failed to see them due to their own shortsightedness.

Truth and irony abound in this education tale.  The truth is that the capacity for learning- indeed, the love of learning- never goes away during our lifetimes.  It may become dormant for lack of use or opportunity, but it is as central to our beings as the heartbeat itself.  The irony is that while most in this country have endless access to even the narrowest fields of learning, we tend to take such privilege for granted and are  willing to forego such capacities in favor of less dynamic pursuits.  And meanwhile, many of the young children of Nicaragua are desperately seeking even the smallest chance to advance their understanding of the world around them. It creates an immense imbalance, one that would seem worthy and capable of address, if we were collectively motivated to do so.

Leave it to a week in Nicaragua to teach me a new perspective.  I am grateful for the gift of life-long learning, a gift intended for all….

Intensity to Learn

 

 

 

Internal governance and the role of cooperatives in Central American rural society

Internal governance and the role of cooperatives in Central American rural society

René Mendoza V., E. Fernández, K. Kuhnekath, J. Bastiaensen, and A.J. García[1]

Thanks to Picketty (2014) the topic of inequality became an issue again in our days. Nevertheless, markets, technology, skills and social relations are formed and decided in institutions and organizations that are “social machines” of inequality. This article is about a part of these “machines”, the cooperatives and the chain of organizations connected to them.

There are 800 million cooperative members in the world (International Cooperative Alliance); in Latin America there are between 30,000 and 50,000 cooperatives with between 17-23 million members (Coque, 2002, based on Buendía, 2001); in Central America there are 8,282 cooperatives, of which 3,410 (41%) are legally registered in Nicaragua with 188,000 members (Mendoza, 2012). In Latin America the food production and the mitigation of climate change depend to a large extent on the small producers; in both cases, the cooperatives are fundamental. Nevertheless, market forces and their influence on States, instead of strengthening the cooperative movement, are affecting it in a negative way.

Committed to the importance of the cooperative movement, we ask ourselves how the member families are managing their cooperatives. Historically and within the current context of neoliberalism, the members have managed their cooperatives from within, be they as part of economic or political chains, or part of their extended families and networks of their communities. The cooperatives are struggling in so far as they are glocal spaces – each organization and their economies are local spaces and at the same time express global forces, expressed in networks, policies and ideas (Hart, 2006). In this work we analyze how the cooperatives are trapped in the “iron law of oligarchy” proposed by Michels, and how they get around and beat this “law”, and under what circumstances they do one or the other. Supported by Polanyi, we ask ourselves how the cooperatives are expressing tolerance for the “movement” (neoliberalism and its different variations), what sensitivities do the “counter-movement” processes have, and thinking about how to carry out “transformative research”, we also reflect on a normative question, how should the member families be managing their cooperatives.

It is a text based on a bibliographical review and practical experience in which the authors are involved, believing that the theory and practice are connected and that social science contributes to social transformation.

1. About the research question

How are the member families managing their cooperatives? The question assumes that the members manage their cooperatives, how do we know that they are managing them? Most of the current studies refer to cooperative enterprises for taking advantage of market advantages, the advantages that they have “for achieving greater economies of scale, adopting new technologies, obtaining information on the market, or expanding the scope of operations in another way, not achievable by a company on its own” (Henehan, et al, 2011[2]).) Along these lines, Hueth and Reynolds (2011) think that, instead of the traditional “representation processes from the bottom up”, the key for cooperatives is an Administrative Council with business knowledge and the capacity for communicating with its members about the positive impact of the cooperatives in the market in favor of the people[3]; and along with the Council, a “well qualified team of organizational, legal and accounting advisors can be beneficial for the success of the cooperative development ” (Henehan, et al, 2011). The question for researchers and also for members of the cooperatives is: How do you manage your organization? The leaders and managers of Cooperatives from different countries agree that cooperatives are managed by their laws, voting and by the assemblies[4], but in the end they think that their cooperatives are governed by their board of directors (“…governs all the positions of the cooperative”, see footnote, page 4). This has the cooperatives based on a formal procedure, through which the Administrative Council leads a cooperative, in particular having an understanding of business.

If the cooperatives as economic organizations are part of value chains, where the governance is agreed upon among the connected (trans)national enterprises, based on their procedures, “coordination through governance mechanisms” and “configuration and/or application of parameters throughout the chain” (Humphrey and Schmitz, 2002:9), the cooperatives move within organizations promoted by the market, like any business. In this framework, the role of “governance” of the member families involves doing out what corresponds to them: delivering to their cooperatives more or less products that respond to what is required, and paying, or paying less, for the services that the cooperatives in the chains provide them. From here, the market, through the chain of companies, drives norms, products, services and social relationships, and gives shape to the way in which the cooperatives organize themselves internally, and in relationship to others (for example, it pressures the members to specialize in one crop, discourages a cooperative from connecting with another in their communities).

Our research question allows us to place it within a political context. If they choose their presidents, they are part of a “chain of managers”, at the same time the members still have “governance function”, for example they can turn in (sell) less coffee, and sell the rest fo other buyers. When we look at the roots of the cooperative movement, elections are a political action which is not the only governance role of the members; when cooperatives respond to their adapted Rochdale principles (voluntary and open entry, democratic management, economic participation, autonomy and independence, education, cooperation among cooperatives, commitment to the community), they are governed by all the members. Nevertheless, when these principles are expressed in laws and supervised by States, at least in Central America, the States tend to control the cooperatives along the lines of their political interests; therefore, the members apparently have less – while the states have more – “governance role” in the cooperatives. As an hypothesis, we would say, when the cooperatives respond less to their adapted Rochdale principles, and are more dependent on the market and the state, they are more trapped in the “iron law of oligarchy”.

The Central American cooperatives are “political arenas”: “places of concrete confrontation between social actors that are interacting on common issues” (Bierschenk and Olivier de Sardan, 1998: 240), where the interests, policies and ideas of different trans-local actors are expressed (see Figure 1). These conflicts means that there are different paths, and that the members are also actors. It seems that this has been the historic case of the agrarian cooperatives; their appearance is due to the state, donors and the Catholic Church, and in general as an expression of the resistance of the families to the dispossession led by intermediaries and userers.[5]. For the members, that struggle has meant the diversification of products, markets and network strategies, as well as the way they assess their cooperatives depending on specific circumstances.

For the purposes of this article, we understand governance in the cooperatives within a broad and multiple perspective. The cooperatives as organizations are global “political arenas” in which the forces of society, the market and the state participate in various chains of actors, and where there is conflict and coincidence of interests, ideas and norms, as well as competitiveness and cooperation. There are two central lines that cross one another in this: resources that come in from the top down, expressed as procedures, prices, costs or donations; and knowledge that comes from bottom up. The small producers are struggling within this framework with votes, product delivery, cost reduction, payment for services, negotiation, learning…

articulo CEC-3 eng Figure 1

This article is a basis for us to study 25 cooperatives as organizations between 2014 and 2016, in their internal aspects, and as part of the transnational chain of actors, looking for how, within the context of neoliberalism,  they express tolerance toward the “movement” (market and state imposition), and sensitivity to the processes of the “counter-movement.” The specific research questions are: What have been the structural mechanisms for controling the cooperatives and making them instruments of the elites or for becoming autonomous and responsible organizations? Under what circumstances have they emerged, evolved, and how can they be transformed?

2. Cooperatives as organizations

A dozen people come together and form a cooperative, and so the “collective” and the “social” appear. A cooperative is a legal organization, under which there are agreements with goals, procedures and members. Later the importance of control mechanisms appears, because there are resources to administer, as well as claims for their redistribution. And that organization is part of a chain of organizations, be that with other cooperatives that form a second and third tier organization, be that with market organizations (e.g. fair trade, Ritter cacao company, Eskimo and Parmalat in milk), or with state institutions and organizations at the community level (see Figure 1).

Generally the cooperatives are taken for granted. In Latin America the Social Economy approach (see Guerra, 2012), that emerged from the decade of the 1980s, reflects the appearance of organizations (ethical banks, fair trade organizations, small farmer networks, self governed workshops, religious base communities, and poor communities in the urban peripheries) in reaction to the institutional crisis created by the neoliberal policies. In the decade of the 1990s solidarity economies emerged, new cooperatives and associations with popular and solidarity groups, and informal collectives (bartering clubs, revolving funds, communal banks, family cooperative and collective networks), all of them were added to the traditional cooperatives, mutual benefit societies and associations, forming the solidarity economy movement. Reflecting this, the social economy approach reconceptualizes the companies and the economy as “forms of economic organizations – production, commercialization, finance and consumption – that have as it basis associated work, self governance, the collective ownership of the means of production, cooperation and solidarity[6].” In this framework, the cooperatives are seen as part of a larger family of organizations, and to a certain extent, the reconceptualization of the company and the economy is close to the Rochdale principles. Nevertheless, based on our understanding of the cooperatives in Central America, this type of cooperative is like an ideal; it is assumed in the social economy that the cooperatives have internally harmonious social relations, that conflict only happens with the private and public sector, and consequently the internal situations of the organizations are not studied.

We want to study the cooperatives as they are and observe the process by which the cooperatives change or can change. In what follows we summarize Michels (1962; first publication in 1911) in terms of his theory of the “iron law of oligarchy.” Then we present Lipzet et al (1956), who, without denying Michel´s theory show that there is another route to “the law”[7]. In both cases we are going to look at the internal part of the organization, and then we will contextualize it within a broader organizational framework.

2.1 The path of the oligarchy and the way to avoid it

When an individual person cannot solve a problem, he or she can resolve it through an organization. Cooperatives have emerged to resolve commerce and the concentration of credit, to learn about agricultural technology and to grow as leaders, to defend their land and their perspective on environmental issues. Organization is a means for carrying out collective action. In theory, the organization is what emancipates people and helps small farmers be viable in economic, social and environmental terms. Nevertheless, cooperatives, according to our preliminary observations, have become more politically centralized and economically concentrated in fewer hands, which could be affecting small farmers and maybe slowly dispossessing them of their organizations; even though the small producers as actors are certainly resisting in different ways.

We are facing events with “unexpected consequences” (Merton). The values system of the cooperatives (the adapted Rochdale principles) illustrate that the practical results of this political and economic process are not necessarily identical with the Rochdale principles. The social relationships themselves that make possible the production of the values system of the Rochdale principles give birth to and observe “their own laws” that can change the “intentional meaning” of the values system behind the individual participants in a new “sense.” In other words, the conditions that give rise to a collective value system are not in every case identical to the conditions for their implementation. For the implementation of the cooperativist ideas on the level of their social relationships, it is not enough that those ideas of values enter into the identity of the cooperative as a social group; suitable structural conditions would have to exist, whose “laws” would not hamper, but rather facilitate the transformation from one state to the preferred state. The role of the structural conditions on the implementation of collective values has been discussed within the context of the democracy problem, and now in the conext of the values system of the cooperatives. Democratic norms require that the decisions about collective goals and actions not be done through imposed applications, but through consensus under the possibility that all the participants can have an impact.

It is difficult and problematic to carry out this democratic postulate if the magnitud of the group or the problems that they have to solve requires a delegation of tasks and an organization of decision making through a division of labor. In this case the possibility of democracy depends on the fact that the different policy functions (horizontal differentiation) not become the starting point for a vertical differentiation with a division of different and unequal powers. The German-Italian sociologist R. Michels (1876-1936) belongs to that group that believes that democracy is an illusory program that assaults and rejects fundamental social laws. In the beginning of his professional life Michels belonged to an anarchical trade union movement, and later got close to the fascism of Mussolini. He discovered, within the context of his research on the structure of the organization of the German  worker movement, a structural mechanism that he himself called the “iron law of the oligarchy”. This principle means that every attempt to achieve collective goals and interests leads to an unequal distribution of power among the participants. According to Michels it has to do with a structural mechanism whose effect is completely independent of the values system ideas of the affected social group.

Michels (1962:365) said that “it is the organization that gives rise to the dominion of the elected over the voters, of the leaders over the constituents…the one who says organization, says oligarchy.” This result is due to the modernization of organizations that requires competent leadership, centralized authority, and a division of tasks within a bureaucracy. Within this framework, the leaders increase their power in proportion to the growth of the organization; more organization less democracy; more extended and branches to the organization, less control of the members; the more developed an organization is, the more complex is the administration, the more specialized are its obligations, and the greater the differentiation of functions. He stated that representative democracy in place of an elite government was not possible, that it was only a facade to legitimize oligarchical rule. A quote that summarizes his theory is:

… society cannot exist without a “dominant” or “political” class, and that the dominant class, while its members are subject to frequent partial renovation, constitute, nevertheless, the only sufficiently lasting factor of effectiveness in the history of human development. From this point of view, the government…, the state, cannot be anything else than the organization of a minority. It is the objective of this minority to impose on the rest of society a “legal system”… The majority is, then, permanently incapable of self governing. Even when the discontent of the masses culminates in a successful attempt to deprive the bourgeiose from power…always and necessarily a new organized minority sprouts from the masses, that is elevated to the rank of a governing class. So, the majority of human beings, in a condition of eternal guardianship, are predestined by tragic necessity to submit themselves to the dominion of a small minority… (Michels, 1962: 353-354).

So the oligarchy is constituted following what the organization requires, the docility of its members, the conversion of the leaders into men abandoning their ideals, and into the bureaucratic apparatus of the organizations that become more and more hierarchical.

It is not surprising that Michel´s thesis, that in a simple and grandiose way declares that democracy is impossible, continues provoking debate today. The book of Lipset, Coleman and Trow (1956) is an important reference for our study on cooperatives. They differ from other contributions on the problem formulated by Michels. Lipset et al do not discuss the “iron law of the oligarchy” of Michels on the level of general theoretical speculation, but with the support of empirical analysis try to reduce and limit the claim of validity of Michels´”iron law” to specific structural conditions to define ex negativo the social premises of democracy. Lipset et al, through observation and case study, proved that the political process was getting off the course proposed by Michels. How was it possible to escape from the authority and validity of the “iron law”, characterized by differentiation of status, power formation and change of interests? How can the formation of a cartel of officials with monopoly control over political and organizational capacities be prevented in an organization? The authors found that the key factor is the central axis of a system of organization of values which prevents the formation of a cartel of officials, that it is the competition for leadership anchored in the statutes of the union and in the daily work of the organization.

Lipset et al explained the exceptionality for building democracy was due to the coherence between individual conduct, the quality of the local environment, the leaders and the identification with the industry; through these factors, an underlying idea is the social basis as central for political life. First of all, the union was founded by a local group that valued its autonomy, located in a place with a strong history of local organizations, that was reinforced by the printing industry that operated in the local and regional markets. Secondly, the economic situation of the members was pretty homogeneous, all of them belonged generally to the middle class, with relative equality in terms of income, status and communications skills, all of which motivated them to have democratic decision making processes. Thirdly, they kept the competition between two different groups in the elections, which kept the leaders from falling into corruption, and the existence of this competition allowed them to play a counterweight to the leaders in order to avoid oligarchical practices. And fourthly, the identification of the members with the industry, which related to the local economy strengthened by the industry that operated in the local and regional market, without much competition.

2.2 Broadening and specifying the study on cooperatives

Lipset et al include the (local) context that is missing in Michels´study. Both studies are based on empirical research, Michels writes based on his participation in organizations, while Lipset finds in the Union a divergent path from Michels´theory, first as part of his university work, and then applying a survey to the Union itself. Michels and Lipset et al were based on urban organizations and industrial workers, while our concern is with farming families. They focused on the internal world of organizations, which is also our interest, particularly the first tier cooperatives, but contextualized within a broader panorama. Then, these cooperatives, in most of the cases, belong to a second tier of cooperatives, an interrelation that has to do with our study. Then, most of the second tier cooperatives are part of third tier cooperatives.  A common pattern between the three tiers of cooperatives is that each “higher” tier tries to concentrate the principal functions and resources from the “lower” tier of the cooperatives, while at the same time adding new functions; the principal investments are concentrated in the second tier cooperatives (e.g. processing industry), as well as resources and services (commerce, credit, technical assistance).

Now our unit of analysis are the first tier cooperatives. We see them as global arenas, in which different organizations (cooperatives, fair trade companies, state and organizations) and local networks have an impact. By way of hypothesis, if the first tier cooperatives change (improve), all the cooperative movement can be improved, and the relationships with the different actors, including markets, can change. Inspired in Michels and Lipset et al, we think that the cooperatives tend to fall into the “law of oligarchy” and at the same time their members develop cooperatives as their means for their own viability. It is a process where the key resources (prices, product quality, credit, knowledge, meaning) are fought over, mediated by multiple and different rules, with the intervention of multiple actors committed to their interests, strategies and ideas. All this above all in the last 30 years. (See Figure 2).

articulo CEC-3 eng Figure 2

2.3 The context that affects the cooperative organization

What does (glocal) context mean? Marx refers us to the circumstances in which people make their history. We think that part of those circumstances in Central America refer to the rural zones where there is no longer space for extensive agriculture (increasing production with more area), based on the old knowledge of slash and burn. Covey (2012:xiii) states that “we are in the midst of one of the most profound changes in the history of humanity, where the principal work of humanity is moving from the industrial era of “control” to that of the knowledge worker. From this angle, the rural zones of Central America are moving from extensive agriculture to a more diversified economy, where knowledge is what is most important.

Let us illustrate this moment with the words of a producer, words that are shared also in other parts of Central America:

“In the last 10 years agriculture has been getting complicated. We used to plant, weed, and harvest, when things went bad, we would use new areas; but now the plants are weak, there are more insects and diseases, more sellers of inputs, the rainfall varies more, there are no more areas …” (Member of the José Alfredo Zeledón Cooperative, Nicaragua; March 2013).

This small farmer was refering to the agrarian situation, to maintaining the production level of previous decades; the change is even more profound when prices are added in, as well as costs of inputs, terms of exchange, productivity, product quality…Our hypothesis is that, even though the rural context is changing, the structures of organizations that collaborate to benefit small farmers remain the same, while the large organizations that affect small farmers are progressing rapidly, like the business circuit of companies (market, finance, research and development approaches like “payment for environmental services” and “payment for results”), the reorganization of value chains and the use of stagnant local organizations.

This means that the old patron-client relationship prevails in the region, which affects the way in which the cooperatives are organized; and from the side of the cooperatives and the organizations that work with cooperatives, the “leader-follower” approach persists. Marquet (2012) maintains that the leader-follower approach assumes that the world is divided between a minority of leaders and the large mass of followers. This approach has developed over a long period when progress depended on physical work, where the skill of the leaders was needed to mobilze the masses with physical work. This also has been the situation for centuries in Central America: a deep connection between the patron-client relations, the leader-follower approach, and extensive agriculture (and extractive economy).

The current context, nevertheless, depends more on cognitive work. In Nicaragua the end of the agricultural frontier and extensive agriculture, that requires more physical labor, is just around the corner, because the agricultural frontier has reached the ocean, challenges are increasing because of climate change and the instability of agricultural markets. There is an urgent need for an agriculture that makes intensive use of the land, provides more added value to products and natural resources, and an improvement in the lives of the people. All this means that we are living in a more complex world where the actors need more knowledge. So the agrarian context is changing, while the organizational structure of the small farmers and organizations that work with them apparently remains fixed. Consequently, there is an urgent need for their transformation.

Covey (2012) argued that the present context has to do with the “knowledge worker”. For the purpose of responding to this context, Marquet (2012) introduced the leader-leaders approach, where all can be leaders and use their leadership skills in every aspect of life; that according to him three elements make this possible: that you have authority (decision making and interaction for solving problems in each area of the organization without passing through vertical procedures); competencies (specific knowledge, deliberated thought before acting, and learning instead of being trained); and clarity (know the purpose of the organization and the criteria for decision making[8]). This perspective could be coherent with the Rochdale cooperative principles in the sense that it includes formation (education), cooperation (transformation of the organization), participatory decision making, transparency…

The glocal context in which the cooperatives move is changing, from a world based on physical work to a world in which the principal challenge is learning, and the organization of agriculture for producing more in the same zone, with better quality, and environmentally, economically and socially sustainable. This challenge pressures organizations to be transformed, to overcome the patron-client relations and the leader-follower approach. Therefore, we propose two hypotheses: 1) the longer the transformation of the organizations takes, the more dispossession will happen; 2) the 1st tier cooperatives are key because the knowledge of their territories has become the fundamental crossing point between the flow of resources (“services”) that come from the top-down and the flow of knowledge that goes from the bottom-up for the control and orientation of the resources (“services”). Figure 3 summarizes our renovated framework. 

articulo CEC-3 eng Figure 3

3. Market forces

We began asking our research question, about how the members manage their cooperatives. We reviewed the studies of Michels, and Lipset et al in order to read the cooperatives as organizations on the oligarchy route (sometimes called “patron-client” or “leader-follower” relations), and as a space where the members transform their organizations. In focusing our unit of analysis on the 1st tier cooperatives, we place them in their larger context, including other groups of cooperatives, fair trade organizations and the state (even though without more discussion). Lastly we mentioned the challenge of learning and organizing agriculture in the current agrarian situation of Central America, which requires the transformation of the cooperatives and the organizations connected to them. But we have not discussed the more important factor of our time, the markets, that have a huge affect on the cooperatives. This section will now deal with that.

3.1 The Neo-liberal market “movement”

The agrarian cooperatives have risen as a reaction to the despotic and oligarchical organization of the elites who dispossessed the population of their land, capital, labor and /or product markets. Nevertheless, we see that the cooperatives over time tend to become something contrary to their purposes, into something oligarchical and anti-democratic, reduced to the economic aspect. What is the magnetic force that draws them away from their purposes and their cooperative principles? Stiglitz (2001:vii), in the prologue to Polanyi´s book said:

… Polanyi, who described the great transformation of European Civilization from the pre-industrial world to the era of industrialization, and the changes in ideas, ideologies and social and economic policies that accompanied it. Due to the fact that the transformation of European civilization is analagous to the transformation that the developing countries throughout the world are facing today, frequently it seems like Polanyi was talking directly about the current situation.

What did Stiglitz mean? Polanyi (2001, published originally in 1944), described the situation of Europe before the Second World War. He understood society to be in transition to the market economy. In the non-capitalist economy or the “society of markets”, people organized their economies under the logic of reciprocity and redistribution, the markets had limited functions with trade mediated over large distances. In the capitalist society or the “market society”, people tended to sell in an extended way and maximize their profits, and consequently the social order eroded. The factors of production, like land, labor and capital were no longer defined more by criteria of tradition, reciprocity or redistribution, but by the markets as “ficticious merchandise”. Society subordinated to the market, and as a self regulated market separating society into economic and political spheres. This image of Europe before the Second World War is what Stiglitz says is what the current situation of developing countries is like.

Polanyi suggests that the liberal radicalization through the “market society” led toward fascism as an authoritarian –corporativist way of re-establishing the control of society over the market, the eroder of social relations. The lessons were learned, and Europe, after the Second World War, created its welfare states with a fundamental role for the states, in general terms on the basis of the ideas of Keynes. They experienced what was called “embedded liberalism”: a relationship between the economy and the social system where the economy is embedded into society (Ruggie, 1997, 1982). Nevertheless, this system was contested, with the increase of greater predominance of liberal thought from the time of the 1973 oil crisis and the debt crisis of the Latin American governments in the decade of the 1970s, and consequently, the prevalence of neoliberal policies since 1980.

Probably the most inspiring source of neoliberalism, at least for our topic, is F. A. Hayek from the Austrian School of Economics, who delved into the old liberal ideas of the market economy, smaller role of the state for maintaining the rule of law (Hayek 1944); and proposed the free price system for sharing and synchronizing personal and local knowledge, which would allow the members of society to promote different and complicated purposes through the principle of “spontaneous self organization”. Hayek (1944) argued that you have to let the market do everything, that the function of the State is to protect the market, that the free price system was like language, the result of human action but not designed by humans. “Self organization” seems equivalent to “spontaneous order”, understood as free networks and not created nor controlled by anyone, while the organizations are supposedly hierarchical networks, created and controlled by humans.

Whether the State is democratic or not is not the principal concern of Hayek, because even though in the long term he was against dictatorships, as a transitional phase he prefered “liberal dictatorships to non liberal democratic governments” (Farrant, McPhail and Berger, 2012: 513) in reference to the Pinochet dictatorship in Chile. The fear exists that people could get involved through the state (for example, through elections), due to the risk of the interruption of the common good which is the market (Boudon, 1981). It is not whether the majority should prevail, but the efficiency and automatic optimization of the interests of all through the market. Hayek (1979, 1982) maintains that power should be in the hands of an elite that protects the market from any type of intervention, which is why the degree of democratization should be limited. More economy means less democracy – something contradictory in Hayek, because that coincides in large measure with Michels´law, which in theory was rejected by Hayek.

In this way, under the influence of Hayek and others, neoliberalism as a political project for the expansion of spaces for the free market through a reduced, but many times strong, state has been the agenda since 1980. The developing countries had to accept the Washington Consensus (privatization, governments out of the economy, liberalization policies), the European welfare states began to be affected, the markets directing society (Ruggie, 1997), precisely what Polanyi observed in Europe before the Second World War.

Let us note that the market appears to be supposedly free, but it responds to the hidden interests of large economic clusters. Polanyi refered to it in his time with the expression of “always embedded”, because the free market does not exist, it is a market deliberately constructed to promote certain interests, it is not the theoretical free market of Hayek without political control that is in play, it is not a conflict between “market” and “society”, but between a specific political project of “individual markets” and societies that should adapt to them, and another political project where the mutual adaptation market-society is different. It is the case of post Second World War Europe, the control of society over the market did not keep it from being a capitalist market (mitigated, but capitalist).

In this process, going back to Hayek, we highlight the growing centralization of the modern State, which has become more distant from society and from the political and economic systems. It is said, for example, in the case of Europe, the European Commission is more and more powerful, that the European Parlament is less strong, as well as the growing subordination of the states to the European Central Bank. Likewise, in the “socialist countries”, China since Xiaoping with the “socialist market economy” and politically centralized; or Cuba in the last 5 years. It would seem that the fear of the masses is something that has become “globalized”, like the belief in more economy and less democracy.

What does all this have to do with cooperatives? We began this section describing how the cooperatives have evolved toward non-democratic and economicist organizations. In addition to what was seen in previous sections, now we run into another part of the magnetic forces, the markets. Correspondingly, the developing countries are seen in a transition to the “market society”, self-organization guided by the market, “fictitious goods”, centralization (state controlled by a minority), market protection, exclusion of the masses. It can be understood from this angle why the donors and states are trying to turn the cooperatives into enterprises, private organizations with “fictitious goods” seeing the cooperatives as “gatherers of products” and their members only as “producers”; the centralization of decisions and information, absence of spaces for democratic processes; concentration of wealth in the second tier cooperatives controlled by a minority; prevalence of managers of cooperatives in the decisions about cooperatives and in leadership posts in international cooperative organizations…Literally, under this angle, the cooperatives are useful for contributing to the transition processes toward “market societies”.

3.2 “Counter-movement” processes

The perspective of the previous section is pessimistic. Are the cooperatives mere instruments (“movement”) of the neoliberal market? If we make the connection between this situation and the state of extensive agriculture, the situation is seen to be even more difficult. Nevertheless, we also observe resistance on the part of the cooperative members. There are cooperatives that have built their autonomy since their founding on the increase of their capital based on the economic resources of their members, in order to administer their own credit; cooperatives that challenge their perpetual leaders and managers; cooperatives that combine the perspective of their farms and that of environmental sustainability; cooperatives that export directly, and not through second tier cooperatives; women organized into cooperatives. There are also some lessons that combine market and organizational transformation; for example, basic grain or ranching cooperatives are no longer seen, the cooperatives are into differentiated products, in other words, the greater the differentiation of products the more necessary the cooperatives seem to be; consequently, there are organic coffee cooperative, milk product cooperatives, sesame seed, cacao cooperatives… Secondly, the greater majority of the members turn over part of their produce to the cooperatives, but never turn over 100%, it does not matter how great the fair trade premium and the projects may seem, an action that from the angle of the “market society” is seen as a deviation (“disloyalty”); the small farmers, regardless of the pressure to specialize, continue diversifying their products, networks and markets. Thirdly, some (even though very few) international organizations also understand these processes and are working accordingly.

Polanyi (2001) saw that society reacted to the “movement” (“the market society”), people sought their own protection and they resisted (“double movement”). Our purpose is to study how the cooperatives are doing, how they can be transformed, and how that process is fundamental for the democratization of “societies with markets”. For this reason we quote what Marx said in 1852 in the Eighteenth Brumaire of Louis Bonaparte:

“Men make their own history, but they do not do it on a whim; they do not do it in self-selected circumstances, but in already existing circumstances, given and transmitted from the past. The tradition of all dead generations weighs like a nightmare on the brain of the living. And just as they appear to be busy with themselves and to revolutionize things, the creation of something that did not exist previously, precisely in such times of revolutionary crisis that fervently evoke the spirits of the past to their service, the borrowing of names, battle crys, and clothing for the purpose of presenting this new scenario of world history within the concealment of  long tradition and borrowed language.”

‘Counter-movement’ is a process that is carried out within the situations of the “movement”. The circumstances are not under our control, we do not choose them, but without a doubt the key issue is the relationship between the actors and the circumstances (structures). So, we should study how this “movement” and “counter-movement” is constructed in the cooperatives. On this basis, see Figure 4 and Table 1.

articulo CEC-3 eng Figure 4 Third Framework on coops

5.     Final observations

The cooperatives in Central America are fundamental for the economy and democracy, for the mitigation of climate change and the production of food, and above all so the rural families can improve their lives. Nevertheless, at the same time that there are great opportunities, the cooperatives are also at risk of being politically co-opted and economically subsumed. Thus the importance of understanding the “movement” in order to understand the processes of the “counter-movement”.

This article summarizes the conceptual framework for studying cooperatives in Central America, seeking to combine traditional research and something new. We have begun studying 25 cooperatives, accompanying their experiments on innovation, and systematizing their processes jointly with the cooperatives. This process is about the transformation of the cooperatives, being careful about the limited role that we might have from the social sciences. We are working on this with a network of researchers that includes cooperative leaders, even all their members, also researchers from various universities. An implicit purpose is building bridges between the “university” and the small producer cooperatives, in this way also contributing to the democratization of research.

 

References

Bierschenk, T., and Olivier de Sardan, J.P., 1998. Les Pouvoirs au Village: Le Bénin Rural entre Démocratisation et Décentralisation. Paris: Karthala.

Boudon, R., 1981, The Logic of Social Action: An Introduction to Sociological Analysis. Routledge & Kegan Paul.

Buendia, I., 2001, Las Cooperativas en América Latina. Estado de la cuestión. In: Perez, J.M. (ed) Economía Social e Iberoamérica: la construcción de un espacio común. Valencia: CIRIEC-España, pp.  67-86

Coque, J., 2002, Las Cooperativas en América Latina: visión histórica general y comentario de algunos países tipo. In: Revista de Economía Pública, Social y Cooperativa. No. 43. Pp. 145-172. http://www.ciriec-revistaeconomia.es/banco/08_Coque_43.pdf Last consulted: September 8, 2014.

Covey, S., 2012, “Foreword” in: Marquet, L.D., 2012, Turn The Ship Around! How to Create Leadership at Every Level. Texas: Greenleaf Book Group Press

Farrant, A., Mcpahil, E., Berger, S., 2012, Preventing the “Abuses” of Democracy: Hayek, the “Military Usurper” and Transitional Dictatorship in Chile? American Journal of Economics and Sociology, Vol. 71, No. 3 (July, 2012). http://coreyrobin.files.wordpress.com/2012/07/hayekchile.pdf

Guerra, P., 2012, Las legislaciones sobre economía social y solidaria. Casos latinoamericanos y europeos.  Documento de Trabajo No. 4. Montevideo: Facultad de Derecho de la Universidad de la República.

Hart, G., 2006, Denaturalizing Dispossession: Critical Ethnography in the Age of Resurgent Imperialism, en: Antipode, 38(5): 977-1004

Hayek, F.A., 1944, The Road to Serfdom. England: Routledge Press.

Hayek, F.A., 1979, Social Justice, Socialism and Democracy. Australia: The Centre for Independent Studies, 1979.

Hayek, F.A., 1982, Law, Legislation, and Liberty : A New Statement of the Liberal Principles of Justice and Political Economy. London: Routledge and Kegan Paul.

Henehan, B.M., Hardesty, Sh., Shultz, M. and Wells, J., 2011, “New Cooperative Development Issues” en: Choices, The magazine of Food, Farm and Resource Issues. A publication of AAEA Agricultural & Applied Economics Association. http://www.choicesmagazine.org/choices-magazine/theme-articles/critical-issues-for-agricultural-cooperatives/new-cooperative-development-issues. Last consulted: August 27, 2014.

Hueth, B. and Reynolds, A., 2011, “A Life-Cycle Perspective on Governing Cooperative Enterprises in Agriculture”, in: Choices, The magazine of Food, Farm and Resource Issues. A publication of AAEA Agricultural & Applied Economics Association.

Humphrey, J. & Schmitz, H., 2002, Developing Country Firms in the World Economy: Governance and Upgrading in Global Value Chains. Paper Heft 61. UK: IDS-Sussex University

Lewis, D, Bebbington, S, Batterbury, A, Shah, E, Olson, B, Siddiqi, MS & Duvall, S., 2003, “Practice, power, and meaning: frameworks for studying organisational culture in multi-agency rural development projects” in: Journal of International Development, vol 15, no. 5, pp. 541-557

Lipset, M., Trow, M., and Coleman, J., 1956, Union Democracy: The Internal Politics of the International Typographical Union. USA: New York Free Press.

Marquet, L.D., 2012, Turn The Ship Around! How to Create Leadership at Every Level. Texas: Greenleaf Book Group Press

Mendoza, R., 2012, “Nicaragua – 33 ANIVERSARIO DE LA REVOLUCIÓN: Café con aroma de cooperativas” en: Revista ENVIO No. 364. Managua: UCA http://www.envio.org.ni/articulo/4548

Mendoza, R., 2014 (soon to be published), “Collective and Shared Leadership: Antidote for a society dependent on bosses and patrons” in: Encuentro. Managua: UCA

Michels, R., 1962, Political Parties. A Sociological Study of the Oligarchical tendencies of Modern Democracy. New York: The Crowell-Collier Publishing Company. (First published in 1911)

Picketty, Th., 2014, Capital in the Twenty-First Century. USA: Harvard University Press. First published in 2013.

Polanyi, K., 1944, The Great Transformation. The Political and Economic Origins of Our Time. New York: Farrar & Rinehart. 2nd edition, Boston: Beacon Press.

Ruggie, J.G., 1997, Globalization and the Embedded Liberalism Compromise. The End of an Era. MPIfG  Working Paper 1997-1.

Ruggie, J. G., 1982, “International Regimes Transactions and Change. Embedded Liberalism in the Postwar Economic Order”, in: International Organizations 36, 1982, p. 379- 399.

Stiglitz, J., 2001, “Foreword” in: Polanyi, The Great Transformation. The Political and Economic Origins of Our Time, 2nd ed. Boston: Beacon Press

Taylor, C., 1953, The farmers’ movement: 1620-1920. New York: American Book Company

Wade, R., 1997,Greening the Bank: The Struggle over the Environment, 1970–1995.” In The World Bank, Its First Half Century, vol. 2, edited by Devesh Kapur.

 

[1] This text is based on the work on cooperatives of a team composed of Mendoza, Fernández and García supported by the Winds of Peace Foundation (see: http://peacewinds.org/research/). This text benefitted from the support of the Institute for Development Studies (IOB) of the University of Antwerp (Belgium) where Mendoza had six week to review bibliography on the topic. J. Bastiaensen is a professor in the IOB-UA and K. Kuhnekath is an associate researcher of the Central American University (UCA) in Nicaragua. Contact: rmvidaurre@gmail.com

[2] These authors, connected to the perspective of “market driven” cooperatives, write on the basis of a “panel of cooperative leaders, USDA specialists and academic experts.”

[3] The power of the market that the farmers face as individuals provides a strong motivation for collective action. Acting together, farmers can improve the results of their participation in the market, and generate the redistribution of the economic surplus of the input supply and the intermediation sectors with the farming sector” (Hueth and Reynolds, 2011).”

[4] ANASCOOP, a savings and loan cooperative in Puerto Rico, states that their members goven their cooperative by their vote…They choose a Board of Directors…That board is responsible for governing all the positions of the cooperative.”). Mondragón, a cooperative in Spain, states that a member “governs through the delegation of the cooperative congress.”

[5] This is also the case of the US farmers evaluated by Taylor (1953), where for the farming sector, the history of three centuries has been about prices and the power of markets and credit.

[6] Quote from the conference given by Dr. Valmor Schiochet, in the international seminar on cooperativism. Habana, November 2, 2012.

[7]One was written a century ago and the other half a century ago. With this we are not assuming that there are no current theorists for studying cooperatives. But, so far we are not familiar with any study on the internal aspects of organizations. Some authors are useful, like the approach focused on actors of Long, Lewis et al (2003) that proposes a three notion framework (practice, power and meaning), identifying subcultures within (and among) organizations; and Wade (1997) studying the enviromental department in the World Bank on the basis of anthropological methods of being immersed in that department for 9 months.

[8] Marquet has developed this approach while experimenting in a nuclear submarine. Some could argue that a submarine has nothing to do with agriculture and cooperatives; I prefer to think that if it was possible to have success with the leader-leader approach in a nuclear submarine with military verticalness and isolated at sea, it would have to be less difficult to do it in cooperatives and organizations that work with them. For more on this approach in the context of Nicaragua, see Mendoza (2014, soon to be published).

I Wonder

I really do.

I wonder whether this could be the year wherein the Synergy Center notion crystalizes in the strategic thinking of an educational institution and we find a partner to take on the asset.

I wonder if the Indigenous communities with whom we have worked will discover during 2015 that their patrimony continues to be slowly eroded away by some of their elected leaders, and that true community must be transparent in order to be strong.

I wonder if this is the year in which I finally become facile enough with the Spanish language to converse with more than simply, “buenas dias.”  I wonder if working on development issues in a Spanish-speaking country  without an ability to speak directly with partners conveys a sign of disrespect.

I wonder if there is an effective way to help cooperatives embrace the very essence of cooperativism; that is, collective, collaborative, participative, informed engagement.  Are cultural, social and historical factors too much to allow for such embrace?

I wonder if the second-poorest country in the Western Hemisphere can really undertake the largest, most expensive engineering and construction project in history, and what the ramifications of that will be, whether it’s ever completed or not.

I wonder if the relations between the United States and Nicaragua will ever be friendly, or whether friendships will only exist among individuals of those two countries.  And if the latter is true, I wonder what that says about the institutions of government.

I wonder how I would survive on $2.00 per day.

I wonder why greater progress hasn’t happened in Nicaragua, given the amount and form of economic aid that has been made available there.  Where does it go?

I wonder if it’s possible any longer to actually know the truth about nearly anything, or whether institutional “spin” determines that.  I wonder if there really is truth about anything.

I wonder whether my curiosities are well-founded or simply the product of narrow, North American hubris.

I wonder….

 

 

 

 

Innovating in beekeeping makes humanity better in times of climate change

Innovating in beekeeping makes humanity better in times of climate change

René Mendoza V., Edgar Fernández and Yeris Lanzas

 

“If the bee disappeared off the surface of the globe, then humanity would only have four years of life left”

Albert Einstein

 Recently there has been a worldwide alarm about bees. They produce honey and pollinate crops and vegetation; their reduction would affect agriculture and biodiversity. Here we ponder their impact on agriculture, review their evolution, and based on an experience in the municipality of San Juan del Río Coco (Madriz, Nicaragua) we suggest innovating in a beekeeping connected to its economic, ecological, agrarian and social surroundings.

A study of Klein and his colleagues (“Importance of pollinators in changing landscapes for world crops”), with FAOSTAT-2005 data, found that out of 115 crops, 87 increase their production with pollination (39 of 57 crops and 48 of 67 products derived from crops); 20% of total production is by crops that increase the production of seed with animal pollination. They confirm the effect on production in 92 of 108 crops: without pollination in 13 crops (atemoya or custard apple, Brazil nut, cantelope, cacao, kiwi, macadamian nuts, passion fruit, papaya, rowanberry, sapote, pumpkin, vanilla and watermelon) production drops by 90% or more, in 30 crops it drops from 40-90%, and in 27 it drops from 10-40%, and in 21 crops it drops by less than 10%. For Central America, Roubik (2002, “The value of bees to the coffee harvest”) writing on Arabica coffee in Panama, concludes that the pollination of non-native bees increases its production by up to 50%. From this we see that if the pollination services decline, our diet will become nutritionally and culturally impoverished.

Bees are important, but are they being reduced in number? In England the Bumblebee Conservation Fund states that 2 species of bees have become extinct in the last 70 years, and that 6 are in danger of extinction; in the United States the Department of Agriculture (USDA) states that they have been reduced from 6 million in 1940 and 1950 to 2.5 million in 1990. Nevertheless, the United Nations Development Program (2010) states that the data on the worldwide level on their reduction is not conclusive; Aizen (2009, “The Global Stock of Domesticated Honey Bees Is Growing Slower Than Agricultural Demand for Pollination”) states that in the last 50 years the amount of beehives has increased close to 45%, while the growth in crops has been 400% in that same period (Manzano, 2014, “Beeodiversidad”). The alarm finds meaning in the growing deforestation and agricultural intensification – mechanized and dependent on chemical inputs; from there comes the reduction of bees in Europe and the United States so far, the “death” of bees in zones of intensive agriculture in Latin America, and the “migration” of bees in extensive agriculture zones because of drought (no flowers) or rainy season (flowers unsuitable for bees). The more deforestation happens and intensive agriculture is promoted, the less bees there are, the less pollination there is, the more agriculture stagnates.

Beekeeping needs to increase. Its innovations began when the human being perceived that (s)he can harvest honey and wax regularly from the same colony, and built hives with clay vessels and conical baskets (5000AC). In the XVI century Francois Huber innovated the mobile frames, Lorenzo Lorrain Langstroth the standardized use beehive (1851), the carpenter Juan Mehring an apparatus for stamping wax (1857), Franceso de Hruschka the extractor or centrifuge for removing the honey from the honeycomb without breaking it (1865), Abbé Collin perfected the queen excluder (1865), the farmer George Layens the horizontal beehive appropriate for transhumance (seasonal migration, 1874). Correspondingly worldwide production of honey grew from 678,759 tones in 1961 to 1,592,701 in 2012, the year in which all the countries of Central America provided 0.46% of world production. Nicaragua went from 20 tons in 1961 to 100 in 1979, to 200 in 1995, to 300 in 1996, and to 400 since 2000. According to CETREX in the period from 2007-13 Nicaragua exported an average of 211 Metric Tons/year.

In 50 years of beekeeping Nicaragua, according to data from the 2006 National Beekeeping Census, has 733 beekeepers and 24,903 hives. Beekeeping in the municipality of San Juan del Rio Coco illustrates something about what is happening in the country and in the world; between 1963 and 2014 investments have been made of over 3,000 beehives in more than 300 beekeepers, but the Census shows that there are 85 beekeepers with 619 beehives. What is happening? In the decade between 1960-70 beekeeping emerged as an initiative of the large estate owners and with technical assistance from the state, under the logic of pollinating coffee  and extracting honey; the hives lasted more than 10 years, and transhumance was not practiced because there was a forest, in the rainy season they would complement the forest flowers with blocks of sugar and they did not regulate the shade of the trees close to the beehives. In the decade of the 1980s the initiative came from the CORCASAN cooperative with farmers seeking to extract honey and pollinate, the hives lasted up to 5 years, they did not practice transhumance and they would give sugar to the bees during the rainy season. Since 2002 the initiative has been coming from international aid and from the market, they seek to extract honey and in isolated cases pollinate, the rotation of hives is almost annual, they do transhumance in the rainy season because there are no suitable flowers, they provide sugar to the bees and are not investing in the flower supply.

This stagnation in beekeeping is due to a vision where the context in which the innovations emerged is ignored, in a Europe that went through the Renaissance, a humanity that sought to control bees in an environment of flowers, and from there, the innovations focused on the biology of the bees and the physical conditions that made them more productive. Current beekeeping is based on the belief that its greatest challenge is “physical work” of receiving-providing resources, technologies and trainings from outside, and on that “everything has already been invented.” It is an economic vision that is dependent on the bees and separates them from their agrarian, ecological and social surroundings.

beekeeping graphic

In the face of this reality, from one experience in SanJuan del Río Coco, we are suggesting innovating with a holistic visionrecognizing and managing the tension inherent in the connections between bees, beekeeping and biodiversity, and between the improvement of the common good and individual appropriation, disputes that are transforming the territories with flowers, crops, bees and organized families (See Diagram). In this vision, technology, credit and commerce respond to the connections in tension; thus, productivity is not “getting more hives and mechanizing them”, but investing in the connections that result in honey, wax, propolis, coffee, cacao, passion fruit, air, water, land…Part of this process is the crop rotation providing flowers at different times of the year, “sharecropping” between large producers that need to pollinate their plantations and small beekeepers, pollination services, flower inventory as a collective good, and cooperatives facilitating these connections. Seen in this way, beekeeping breaks out of the shell of its “little box” and re-emerges from the connections.

If this innovation in process has the potential of responding to the 50 years of stagnated beekeeping and agricultural productivity, how can we improve it and replicate it in the wet tropics of the country and in Latin America?

* René (rmvidaurre@gmail.com) has a PhD in development studies, is a collaborator of the Winds of Peace Foundation (http://peacewinds.org/research/), associate researcher of the IOB-University of Antwerp (Belgium) and of the Nitlapan-UCA Research and Development Institute (Nicaragua). Edgar i a collaborator of the Winds of Peace Foundation. Yeris is a beekeeper and innovator in the municipality of San Juan del Rio Coco.

It Ain’t Over ’til It’s Over

Here in the U.S., the National Football League (NFL) has now completed its most important weekend, with playoff games reaching a seasonal crescendo leading up to the Super Bowl in February.  And tomorrow evening, college football’s national championship playoff will be played out in front of millions more viewers.  Football fanatics are having the time of their lives, and therein lies an important recognition for all of us, whether football junkies or not.

Time.  The game is played over sixty minutes, no more, no less.  The timeouts and the breaks for television advertisements notwithstanding, the outcome of the game is determined over the entire time to be played.

I watched portions of each of the games played over the weekend.  In a couple of the contests, teams were able to mount  significant leads, only to lose those advantages with the passage of time.   Given my lukewarm interest in the actual outcomes of the games, I found myself more closely observing what I perceived to be the emotions and attitudes of the players and coaches as the scores changed, over the full sixty minutes.

In one game, the presumably favored team fell behind by a wide margin on their own home field.  They caught up, only to fall behind again by the same deficit.  When they fell behind for the second time, viewers could actually see the trepidation in the players and hear the despair of the crowd at their plight.  On the opposite side of the field, the opposing team’s players were jumping up and down, dancing and slapping high-fives with each other amid great smiles of self-satisfaction.

If we had had the opportunity to stop the action on the field at that point and talk with the protagonists from both sides, I wonder what we might have heard from each.  In the case of the home team, we would likely have heard that the game was not yet done and that there was plenty of time to  reverse the outcome.  Such optimism is expected from those who are competitive and driven to succeed.  But we might well have heard the hint of doubt or uncertainty in their words while standing under the glare of the massive scoreboard which, at the moment,  would suggest a different end result.  We might not have even had the chance to speak with the guys who had dropped a pass or missed a tackle; they sort of lose themselves along the sidelines.  It might have been difficult to mingle with any of the players much, as the poor guys just seemed down.

On the opposite side of the field, conversation would have been even more difficult, given the hollering and joyful yelling of the team in the lead.  We’d have a hard time hearing each other.  Here, we would have access to all the players, as every one of them would stand with confidence- even hubris- and a certainty that their game plan had been well-crafted and that victory belonged to them, regardless of the face of the field clock.  The word “destiny” might be heard over the din of excitement.

Well, we now know the final scores.  In some of the games, by the final gun the have’s became the also-rans, while those who appeared to be facing elimination survived.  One of those “survivors” may even make it to the Super Bowl.  Imagine that.  The world often becomes topsy-turvy during these times and those in the lead don’t always emerge as the champions.

Maybe that’s why so many people follow the NFL.  There’s always the chance that the “little guy” will rise to the occasion and achieve a status considered impossible.  And we all love a good story about how the high and mighty are somehow justly brought down to size, especially if at the hands of the little guy.  We make legends of five-foot eight, one-hundred eighty-five pound running backs blasting through a line of behemoths to score in the final seconds, reminding us that time is the controlling element, that ultimate success or defeat only occurs at the end of time.

I start watching some football during this time of year, for the reasons mentioned above.  But I can’t help but watch the story lines unfold with an acute awareness of how time will have a way of bringing great surprise to the highly favored and the the lowly alike.  The reality is, we have no way of foreseeing who will be on top when time runs out….

 

 

“Passing on the gift”, an innovative mechanism for erradicating poverty

“Passing on the gift”, an innovative mechanism for erradicating poverty

René Mendoza V. and Abemelet J. García

 

“These hungry children do not need a glass of milk, but a cow”

(Dan West, 1938)

 An innovative mechanism for erradicating poverty is “passing on the gift”, a mechanism invented 70 years ago. We describe it in this article, analyze its erosion and suggest recovering it.

The novelty in its origins

Dan West, a farmer from Ohio, working with the Quakers and Mennonites, directed a program that distributed milk rations to children during the Spanish civil war (1936-1939). There he came to understand that those children did not need a glass a milk but rather “a cow.” On returning to Indiana, West promoted that vision among his neighbors and the Church, founding Heifer International Foundation, and in 1944 sent the first group of bred cows, donated by local farmers, to Puerto Rico.

The idea was that farmers with cattle would donate to other

families, so that they might have a “cow” that would give them milk for years, instead of a “glass of milk” for days; the families who received it would donate the first calf to another family–passing on the gift, now keeping the cow, in an unending chain. Its principles included being donors to one another, and all that within a religious environment that helped to build trust, faith and social relationships, that they accompanied and made the chain continue.

This innovation assumes that there is dialogue among the families, a study of their real needs (they are not going to give a calf to someone who already has cattle, but in accordance with th

e conditions of the places and the families) and a shared decision between the communities and organizations like Heifer. There is a harmony between endogenous and exogenous factors, in accordance with the circumstances.

When Innovation loses its novelty

“Passing on the gift” has been applied in a good part of the countries of Africa, Asia and Latin America. Heifer International uses it; as well as other aid organizations with and without the advice of

Heifer. It has varied over time and also in different places, some continue with bovine livestock,  others go with sheep, pigs, camels, poultry…They have also been adding environmental aspects.

 

The accompanying Diagram illustrates this system for poultry. One woman receives 6 improved hens, and crosses them with her native rooster. The three month old chicks resulting from the crossing are given to three other women that she chooses. Then each one of the three families chooses a family to give them a similar number of poultry. Along with the chicks, know-

Passing on the gift poultry

ledge is also transferred on the preparation of concentrates, construction of homemade incubator, improvement plan, poultry management, production and financial records. It is a “passing” of products (poultry) and knowledge, while at the same time social relationships are deepened.

Its great potential is the possibility that it become an unending chain, but it has been losing the essence of its novelty. The chain begins with resources (material and non-material) from international aid, and the attention of the families is toward that organization; the chain ends when the project ends. The initial innovation was, more than a “cow”, the vision that emerged in one experience, responding to felt needs, now poultry, pigs or cows are provided to families that many times already have one and their real needs are different. The initial innovation combined exogenous and endogenous factors, now the implicit message is that “what you have and are does not have value”, and the fact that there are different breeds of poultry and different management in the same community goes unnoticed. The initial innovation included a base of social capital that nourished the “passing of the gift”, now the networksand their institutions are ignored, and instead they come in preaching values. The more organizations like Heifer grow, the more they modernize and receive large amounts of resources, and the less they study the realities in which they move, the more they turn the “passing of the gift” into a decontextualized recipe. Something that creates dependency could have counterproductive effects, increasing poverty instead of reducing it.

Recovering the innovation in light of its origin and today´s challenges

Many other innovations, like the Peasant to Peasant Program, that started in Mexico and expanded to the rest of Latin America, have “died on the vine” in turning into a project moved only by international aid. How can the innovation of  “passing on the gift”  be recovered? First, following the rules (“whoever receives, gives”; “the calf is born and is given to another family”; “delivering the calf and sharing knowledge about its care”), adapting the novelty to the realities of the families and communities; 1) not giving a pig that eats more than a family, or that is a “tiger” that eats the hens; 2) recognizing that no one is so rich that they cannot receive, nor so poor that they cannot give, and that “no matter how screwed you are you always have something to give to others” (President  of Uruguay José Mujico, 2014), which is why the inital resources like the “cow” would come from ranching families in each country.

Secondly, innovating progressively following the advice that in Nicaragua, L. Arguello (2009, The government maintains a curative health care system and Nicaragua needs a preventive system) gives us: “if you distribute animals, it should be in this order: improved hens, rabbits, pelibuey sheep, tilapia fish, pigs and cows. And all with the proper prior training and accompanying it with environmentally agricultural techniques: soil and water conservationm composting, humus based on earthworms, crop rotation…”

Third, adoption of the “passing on the gift” on the part of already formed organizations like cooperatives, associations, churches and communities. Each organization provides followup so that the “passing on the gift” of improved hens covers their entire membership; then that organization “A” passes on the first group of improved hens and the knowledge of their care to organization “B”; and organization “A” starts the “passing on the gift” with rabbits…

Finally, the accompaniment of this process is done by the board of directors of each organization; the local government monitors and audits it; the Universities study it and disseminate their findings for the training; and international aid mediates so that the initial resources are provided and the relationship among “donors” gets cultivated.

The “passing on the gift” is a mechanism. The real innovation is that each organization takes it on, recreates it based on their reality and vision, and makes it unending – gradually (from one family to another, from one organization to another) and progressively (from poultry to…cattle) – sustainably, causing this process to take on the “snowball effect” for poverty reduction.

* René (rmvidaurre@gmail.com) has a PhD in development studies, is a collaborator of the Winds of Peace Foundation (http://peacewinds.org/research/), an associate researcher of IOB-University of Antwerp (Belgium) and of the Research and Development Institute, Nitlapan-UCA (Nicaragua). Abemelet is a collaborator of the Winds of Peace Foundation.

Innovation in a providential society

Innovation in a providential society

René Mendoza Vidaurre and Edgar Fernández[1]

 A teacher invited his disciple to drink some tea. They spoke for awhile. The teacher served the tea, and even when the cup was full, continued pouring it; the tea spilled onto the floor. His disciple, surprised, said to him, “Teacher! The tea is spilling, nothing is going into the cup! The teacher responded, “good observation! The same is happening with you, if you want to learn, first you have to empty what you have in your mental cup.”

The beliefs of a community or society are expressed as truths that make up the cosmovision of a people. They are codes, rules or assumptions that mold our minds about how to produce, govern, or live; they trap and limit movement. In the work of innovation with youth and rural leaders we found dozens of beliefs, among them religious ones, that have an immense power to block innovative initiatives. How can these myths be overcome, and have instead God as a support to the people who innovate? This article deals with this issue.

The potency of beliefs beliefs unlearning article 3

In accordance with the attached Table, people believe that “God” made them poor and stupid- like the families with material riches believe that God made them rich and “clever” (not “stupid”); they conceive of a God who creates inequality, and that the life of each person is already predestined. Under this mentality that produces victims and external culprits, the spaces are closed for innovating. These codes in the minds of people appear as sacred truths, which is why daring to innovate could be understood as a sin, because “only God can create”.

The Pew Research Center in an extensive study (Religion in Latin America: widespread change in a historically Catholic region), included the question about what can Christians do in favor of the needy. The Catholics responded that a way of helping the poor is through charity, while the Protestants emphasized that you have to bring the poor to Christ (2014:87). In a number of works, J.L. Rocha (2012, Los jinetes del desarrollo en tiempos neoliberales, tercer jinete: los neopentecostales), studied neo-Pentecostalism, which expresses a theology of prosperity: “The preachers insist on love for children, the time dedicated to them, the need for a positive attitude, the paternal image of God, the duties with the family, the entrepreneurial spirit, the proper administration of money, personal prosperity…The neo-Pentecostal preachers provide practical advice so that the middle class family man  might know how to deal with the challenges of the 21st century.”

Both studies reveal different perspectives about two types of religions, at the same time that they show common points coherent with the above mentality “written down” through the beliefs. We observe no awareness about inequality, the realities appear to be generated by natural (divine) causes and by individual attitudes – charity and closeness to Christ – and the change (innovation) is determined externally. Note that this perspective is similar to neoliberal fundamentalism: let the market (“the invisible hand”, like the Holy Spirit) guide society in a reality where inequality does not appear and where there are only individuals seeking profit. It is a logic that affects above all the majority of the population, while the “middle class” and the rich families assume a God (“the market” the large capital enterprises would say) that gives them prosperity, “an entrepreneurial spirit” and the capacity to give “charity”.

The “mental cup” of our societies is full of this providential framework, incrusted in institutions and cemented into the depth of the soul, whose questioning is prohibited, which is why the possibilities for societal innovation spill out like the “tea”. How can we work on them? 

Un-learning and cultivating a contingent awareness

 The advice of the teacher was, “if you want to learn, first you must empty what you have in your mental cup.” In other words, un-learning in order to learn, which assumes that each person and society is co-responsible for their realities, including the beliefs. The key is to have an effect from within on two complementary manners, through religion itself, and the other way is by making the beliefs controversial. The former involves analyzing the Bible in a shared fashion with the potential innovators, with the support of educators that theologically do discernment on the scriptures, providing a different (critical) vision to that expressed by the 11 beliefs, with a proactive Gospel passage like the Sermon on the Mount, even taking up M. Weber again (“The protestant ethic and the spirit of capitalism”), that it is the orderly, meticulous and thrifty life that provides the reasoning for methodically managing and organizing a business or an organization. In the latter, understanding innovation as a cognitive process, of making the reality controversial: “Juancho says I am fine, while he is in the jaws of an alligator”; the need to improve emerges in mentally producing the crisis that he is not doing “so good”, and that this improvement is a collective process (of groups, networks). Correspondingly we look into the origins of the 11 beliefs, and we clarify in dialogue what underlies those beliefs: a God of inequality and of injustice, with human beings as puppets whose destiny was defined before they were born, passive people, victims and servile people, and a God who dispossesses them of their capacity to innovate; in the case of the ants, we find that they are not kept by anyone, they live through organized effort and work.

Through this process the “mental cup” is emptied a bit, with the challenge being to provide criteria with which to cultivate a contingent awareness: that situations are generated by human actions, they are changeable, people write their own lives (“free will”), and that at the same time humanity does not control everything, as T. Namiki says, believing in God is necessary…in an unpredictable world we all need to depend on something. This is when the innovation begins.

Innovating is questioning and …

This path, nevertheless, is full of obstacles. Old Marx said that ideas are materialized; the 10 beliefs paralyze innovative actions, making people believe that innovating is divine work or the work of the market.

Innovating is “swimming against that current”; in fact, that is how humanity advances. Socrates 2400 years ago was condemned to death by the system that did not put up with being questioned – the question is more important than the answers. Cardinal De Cusa in the XV Century questioned the geocentric model of the universe and with that the idea that God was in the center of the universe. J Fichte in the XVIII Century questioned the universities for being “secondary schools” where the professors would repeat what the books said instead of introducing innovative ideas, for which he was fired from the University. The list continues up to our times.

The priest Ignacio Ellacuría envisioned a change for humanity 25 years ago, “take down the crucified people from the cross”, and he was murdered. In our case the “cross” are these beliefs maintained by religious and neoliberal fundamentalism. Innovating starts from within people in a dialectical relationship with social change; it is un-learning, cultivating a contingent awareness, questioning, coming  down from the cross and believing in a God of justice.

René Mendoza has a PhD in development studies, is a collaborator of the Winds of Peace Foundation (http://peacewinds.org/research/), an associate researcher of IOB-University of Antwerp (Belgium) and of the Research and Development Institute, Nitlapan-UCA (Nicaragua). rmvidaurre@gmail.com Edgar Fernández is also a collaborator of the Winds of Peace Foundation.



[1] We are grateful to the theologian J. Arguello and Jorge Wills, a Methodist pastor, for their comments on the draft of this article.