Dismantling the large estate with cooperativism

Dismantling the large estate with cooperativism

René Mendoza Vidaurre with Edgar Fernandez[1]

You have to look at coffee like the fingers on a hand; the first year we plant, the second year the coffee develops, The third year we harvest, the fourth we harvest more and the fifth year the coffee begins to decline       R. Mairena, President

The cooperative works for me: it sells my coffee at a better price, it gives me credit. And it guides me in growing coffee. M.D. Gómez, Member

Plato in his book “The Republic” tells the story of the cave. A group of prisoners remained chained in a cave since their birth. They cannot turn their heads, they can only see the wall in the back. Behind them is a corridor and a bonfire. Men are passing through the corridor with different objects which project shadows on the wall because of the light. The prisoners believe that the shadows of the objects are real. One day one of the prisoners is freed and seeing the light from the fire, the people, trees, lakes and the sun, realizes the origin of the shadows and that they are only shadows. He returns to the cave to free his fellow prisoners, who on hearing that the shadows were only shadows, do not believe him, make fun of him and treat him as if he were crazy. This allegory reveals the strength of mindsets (tacit beliefs that rule the lives of people).

What is this kind of mindset in a cooperative? How can a cooperative free itself and build its own way? We explain this mindset, study it seeking to change it: we do it from the experience of the Solidaridad Cooperative in Nicaragua[2].

1.     Mental frameworks and their origins

“The large estate provides, and the farm is a drain”, “we always need a patron”, “the patron knows and decides, the rest obey”, “only one crop, more inputs, more production”, “the dumber the fieldhand, the more hardworking they are”, “ the cheaper you pay the fieldhand, and the cheaper the land is, the more money can be made”. These beliefs sustain a hierarchical and discriminating framework, internalized by a good part of our society.

This mentality was refined over centuries all over. By 1880 Matagalpa had an indigenous population with more than 200,000 mzas of mountainous land, most of it was expropriated by the State for coffee; the mindset was in line with the myth of mestizo Nicaragua (J. Gould): “coffee, a civilized crop, indigenous an obstacle for civilization.” Thus between 1889 and 1895 there were more than 200 foreigners in Matagalpa. In time, in the zone of Arenal, Thomas, Manning, Crespi, Harrison and Vita formed large estates. Vita founded the Aranjuez estate (hacienda), later bought by Potter, then by De Savigny, later on turned into the first mountain hotel and later Somoza turned it into a Sanatarium for people with tuberculosis. From the start of the XX century up to now, temporarily interrupted by the war in the 1980s, the following haciendas were formed: El Quetzal, Marsellesa, Monimbo, La Aurora, El Paraíso, El Paraisito, Los Helechos, Santa Ana, La Esperanza and La Minita. The Solidaridad cooperative is in Aranjuez and El Arenal, has an indigenous past and is now surrounded by haciendas.

The hacienda system was imposed with State backing. Racism and dispossession mechanisms went hand in hand, which is the origin of that mentality that persists even in our times. In the 1990s a hacienda closed the road on 62 members of the Carlos Rodríguez cooperative, forcing them to sell their lands at the price that the hacienda had set. Currently the El Quetzal hacienda closes the road after 6pm, thus leaving the communities “closed in”, communities where its own workers live, as well as some families who are members of the cooperative. After 2010 several haciendas of the area have been facing a drop in the production of their coffee, the soils are exhausted, the exploited environment no longer produces: more inputs, more dead soil, the more coffee is exposed to full sunlight, the more the soil is washed away with the rainfall.

The very act of explaining the origin of that mentality awakens people. The hacienda has built itself by taking. More inputs and mono-cropping has led to greater soil deterioration. Closing roads no longer leads to cheaper land, nor does it force the hand of producer families. The “stupid” fieldhand, leaving the hacienda, has become a farmer.

2.     A check on the hacienda: the cooperative

The 63 members of the cooperative have more than 300 mzs of land and produce about 7,000 qq of export coffee. The cooperative collects and exports 60% of the coffee of its members, 30% of that as quality coffee. 20 years ago most of these 63 members were fieldhands – some of them foremen – of the haciendas, they were families with little or no land, some of them producing some flowers and vegetables. Of the 63, some 25 members produce between 30-100qq export coffee per manzana, producing more than some haciendas. A small producer of Aranjuez, who is not a member of the cooperative, with 5 mzs of coffee, won the 2017 Cup of Excellence Award with 91.16 points. That is quality coffee! Diversified coffee farms with bananas and citrus, and not mono-cropping haciendas, produce quality coffee, not just standard coffee. All of this makes the land increase in value, puts a check on the hacienda, and in addition the hacienda sees its earnings decreasing.

It is easy to find examples to illustrate these results. There is a member who is a single mother who lives off her 2 mzs of coffee and bananas, that produces enough for her to support her mother and married daughters. Another member of the cooperative was able to intensify his coffee with bananas and citrus through the cooperative, and left his job as a fieldhand of the hacienda. There is a foreman who became a member of the cooperative and ended up being president of the cooperative.

What has generated this change? Well, the cooperative! Its strategy? First, it understood the importance of regularity in the application of inputs (urea and leaf sprayed fertilizer) that coffee needs in order to produce more, which is why the cooperative provides in-kind credit so that, under technical supervision, each member family applies it and pays for it with that same coffee, for which the cooperative finds markets. Secondly, they got past the biannual nature of coffee (one good year of production and the next year low production), pruning 25% of the coffee each year, and systematically renovating their old coffee plants. Third, the member families are concentrated in a microterritory and receive credit services, technical assistance and collect the harvest right there, which reduces their transaction costs and facilitates a close relationship between members-leaders and members-administration. Fourth, strong leadership pushing the cooperative in new challenges in a calm, gradual way; “directed credit”, “piloting direct exporting with a small amount”, and “getting into milling with low volume”; they do it as they establish relationships with the social banking sector, coffee buyers and chemical input companies.

Seen from the results, organized small scale production provides more and better farms, good for the people and good for the environment. Nevertheless, seen from the processes, following a different path from that of the hacienda, the response is two pronged: increasing family ownership over their production, but not over their organization. On the one hand, the discipline of applying inputs every 30-35 days on their coffee, and selectively pruning 25% of the plants has become a custom, and thereby a tacit law; as well as turning their coffee in to the cooperative, paying their loans and waiting for a better price. On the other hand, the mindset planted by the hacienda persists: “more inputs, more production”, “without the president we would fall”, “information is not up to date and does not get to the members”, “decisions about credit and who can have a better price for their coffee are not made in the organs of the cooperative”, “a buyer even chooses 10 members to buy their coffee”, “we members rely on the president, we only come in to get our loans and our payments”, “the members who do not increase their production will not increase it no matter what we give them”, “if we apply the rules of the cooperative we would be left without members”, “let the member with the most volume of coffee set the price”. A good part of the cooperative and some of its allies breathe in this mindset.

The benefits of the cooperative for the member families and the environment, for Aranjuez and el Arenal are visible, but their durability depends on changes in their mentality. As Saint-Exupéry said in his novel The Little Prince, what is most important is what is invisible. Taking your own path involves getting off the path of the hacienda.

3.     Transformation of  mental models

In addition to increasing production, the cooperative proposes increasing coffee quality, diversified farms with environmental sustainability, stronger relationships with the social banks and buyers, members who study their farms, and good relations between members, leaders and workers. And they are on that path. One member who studies and experiments: “I make a selective leaf spray, because I am watching over my plants, I recognize the coffee bore or rust, I observe it daily, if it progresses, I spray it, if it does not progress, I enclose it”; “I spray the entire coffee field, for prevention”; “ before putting a chemical on it I test it a little”, “what I learned when I had organic coffee I continue applying, I spend less and it goes further”, “I have coffee trees for repopulating and to sell”. The member/leader, the one that asks questions, accepts positions of responsibility and exercises them, complies with the rules of the cooperative and the decisions of its respective bodies, is still a subject under construction. Relationships with the workers, encouraged by a coffee buying organization, are making progress: “Coffee with a union aroma” (https://www.youtube.com/watch?v=_SD3QBJ7r_U&feature=share)

For that the cooperative is refining its strategy. First, it is strengthening the observation and study that led them to determine the regularity in the application of inputs, this time to get beyond the belief of “more inputs, more production” to “more observation and management, more quality production”, including mixtures of coffee in micro-lots. Second, it is keeping its decision to have an office and services in the same territory, trying to get their sons and daughters to participate in the life of the cooperative – as members and personnel-staff. Third, it is making the policies and rules of the cooperative be applied, that decisions come from the organs of the cooperative, that members, board and administrative staff be subject to those agreements, and that the international allies respect and strengthen that institutionality. Fourth, the distribution of earnings based on updated information be posted on the wall- information on loans, financial statement, balance statement, volume of coffee collected, services of processing and exporting – so that the member families might come in to be informed, because informing is forming.

The Solidarity cooperative has taken a giant step: it stopped the hacienda. But even though it is at a standstill; it is still intact; the member families, even though are progressing in production and organization, are dividing up their land through inheritances, and their cooperative instrument continues being a challenge. The myth of the cave could change in the cooperative framework if the 4 elements of the strategy – observation, territory, institutionality and transparency – are carried out as the origin of its “light”, that would let them dismantle the mindset of the hacienda (“shadows”) and discern a new path. Their challenge is also the challenge of the entire world.

[1] René has a PhD in development studies, is an associate researcher of the IOB-University of Antwerp (Belgium), collaborator of the Winds of Peace Foundation (http://peacewinds.org/research/) and member of the COSERPROSS RL cooperative. rmvidaurre@gmail.com Edgar is also a collaborator of the Winds of Peace Foundation.

[2] We talked with the member families, their leaders and staff and we facilitated workshops in Aranjuez. This article is the result of that collective learning with the member families that observed their farms and reflected on their cooperative. We are grateful to J. Koldegaard for his comments on the draft of this article.

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