Category Archives: Wealth Disparity

Equitable distribution of surplus in cooperatives

Equitable distribution of surplus in cooperatives

René Mendoza Vidaurre[1]

Paying back is improving

The revolution and the agrarian reform came, people knew the word and their eyes were opened, many organized into cooperatives and received land, seed and technology, and they said “we are in power.” Within years they sold the land and forgot even the word. They received it, and lost it.

A woman received a cow and in months paid for it with a calf, which was given to another family. She understood that the cow pays for itself, she felt that she paid back, and made an effort along with other families. Paying back is improving.

(Based on a conversation with Gregorio Solórzano, Municipality of Cinco Pinos, Chinandega, Nicaragua)

This parable recalls the historic rules of indigenous and peasant communities. If the action of “giving” is connected with “paying back”, like the woman with the cow and the calf, their lives improve. While “receiving” unilaterally, without “paying back” to the community, creates a false world (“we are in power”) where people are left worse off (“without land and power”). The paradox is that “paying back” is not losing, it is gaining: it makes the person “make an effort” within a collective framework and community space.

That collective framework constitutes the paradoxical difference. In the case of the woman who received a cow and paid back with a calf, an arrangement (agreement, rule) underlies which she fulfills, an arrangement that is connected to a virtuous millennial indigenous institution, “giving-receiving-paying back”[2]. In the case of the beneficiaries of land on the part of the government, a damaging arrangement  underlies it, subordinating oneself and depending on the government, something that leads them to be connected to another historical institution, this time a counterproductive institution, “easy come, easy go”; people lose and the government loses. The gaze of the woman is toward the community, while the gaze of the people in the cooperative is directed outside the community.

Giving-receiving-paying back is growing in collective spaces mediated by rules that are connected with virtuous endogenous institutions of the people themselves. Within this framework, how can distributing (“paying back”) in the cooperatives be the key for growing with equity? Perhaps diminishing is growing?

In this article we study these questions in light of the cooperatives, even though it can be generalized to associations, associative enterprises or NGOS with initiatives under the framework of the social and solidarity economy. We start conceptualizing distribution as a different idea from the neoliberal economy, where the market is the great distributer. Then we look at five ways for the distribution of surpluses: legal reserve, cooperative reinvestment, social-educational fund, direct resources to members, and retribution by way of a member´s rights.  Then we work on how to carry them out. We conclude reconceptualizing equitable distribution as a cooperative concept and one from the social and solidarity economy, that goes along with the democratization of cooperatives, and connected to endogenous institutions of the peasantry.

1.    Distribution rules and policies

In capitalism “the invisible hand” attracts resources and distributes them with inequality, in dependence on the financial power of the actors, their connections, the support of the State for elites (e.g the policy of low taxes for mono-cropping enterprises), and guided by the rule “even the monkey dances for money”. The mediation network captures the resources and returns them as money that buys new products (and labor), mediated by institutions that worsen that inequality: usury, future purchases (crop lien system) and indebtedness. The capitalist, be it merchant, banker or industrialist, is the absolute owner of the surplus.

Polanyi (1976)[3], in an anthropological study, worked on the idea of reciprocity, distribution and interchange. For the topic that concerns us he says: “distribution designates the movements of ownership toward a center and then toward the exterior”, and added, “distribution depends on the presence to some extent of centrality in the grouping”” (1976:7). Santana (2014: 91)[4], rereading Polanyi, indicates that “what is unique here is that there must be trust and loyalty to be able to group the assets in that centrality, knowing that later it is going to be returned in an equitable way.” Let us reread both authors: resources come toward a center, let us say toward a cooperative (like taxes to the State), from there is “goes outside” of the cooperative, to the members in an equitable way. For those “movements of ownership” to happen, there has to be “centrality in the grouping”, which is possible if there is “trust and loyalty”. Without trust and loyalty, there is no “movement.” When is there trust and loyalty that takes resources to the cooperatives and makes them be  “paid back”? Our argument: there is trust and loyalty when the rules of the cooperative, connected to endogenous virtuous institutions, guide the cooperative from its beginnings with a societal and communitarian perspective. In other words, the cooperative, from and for the communities, is responsible for the distribution with equity.

Cooperatives currently, nevertheless, are formed and achieve a partial “movement”: they attract resources from dozens of their members, but it is difficult for them to “pay back” the surplus and pay them back in an equitable way. There is the challenge. For that reason, there are written rules. What are they?

Cooperatives include in their statutes, following the laws of each country, the distribution of profits[5]. Cooperatives include a percentage (%) for legal reserve, % for the social or educational fund, % for distribution among the members according to their contributions or economic transactions in the cooperative – note that improvement in the price of the raw materials is not mentioned as “distribution of surplus”, because it is not, the surplus is calculated after the annual financial year. This is consistent with the principles of historic cooperativism: among the Rochdale principles of 1844 is the “payback of surplus”, then  in 1966 the International Cooperative Alliance (ICA) reformed those principles and replaced it with “the surplus belong to the members”, and finally in another reform in 1995 the ICA said “the economic participation of the members”; in all of them the spirit of the distribution of surplus is maintained. These rules can be connected to the virtuous institutions of agrarian societies, giving-receiving-paying back, the gift that Mauss (1979) described.

Consistent with this cooperative and communitarian principle, the International Fair Trade Movement (FLO), begun in the 1980s and 1990s, in their policy of offering better prices to products coming from families that are organized, included a “fair trade premium”, which in the case of coffee, for example, is US$0.20/lb., a fund so that the members of a cooperative might decide to use it in educational, health projects, and farm improvements or investment in processing installations. Other buyers tend to include also a “cooperative premium”, a fund that the members might decide to use for collective investments that would benefit everyone.

In addition to rules, cooperatives have mechanisms for complying with them. They have their oversight board, the assembly, the education committee, there is also the administration with accounting that issues financial reports. In some countries the State has a role of comptroller of the cooperatives. The international fair trade organizations include their FLO certifier that audits the use of the Fair Trade premium and the democratic processes of the cooperative; social banks require financial statements and balance statements; aid agencies ask for audited reports and evaluate the projects that they finance, and in some exceptional cases withdraw their support when the cooperative fails to fulfill their rules for equitable distribution[6]; likewise some companies that buy coffee or cacao[7].

Having gotten to this point, what do we observe? In spite of having rules and mechanisms for distribution, it is rare the cooperative whose members participate in the decisions on the use of the social fund, reinvestment fund, or on the cooperative premium; it is rare the cooperative that is transparent with its members on the use of these funds; and it is rate the international aid agency or buyer who ensures this transparency, and that the surplus be distributed. In other words, the rules of the cooperative and the organizations are systematically not met; consequently, there is no confidence nor loyalty, which is why the “movement” is in only one direction: the resources from the members go to the cooperative and then to the companies (fair trade, direct trade, or independents), who do not “pay back” the surplus to the members. The rules of the cooperative and the organizations do not end up connecting to the virtuous endogenous rules.

2.    What opposes the distribution of the surplus

Even having rules and mechanisms, why do  cooperatives not distribute their surplus? It seems a matter of adding and subtracting, of knowing rules, signing and complying with agreements; it is not a technocratic matter, that a “scholarly” person might resolve; it implies adding and subtracting, showing the strength of the old anti-cooperative model, and of perceiving their own attitudes. Here we start with three interconnected responses, of the several that exist. See Figure 1.

First, the “business foot” of the cooperative, and organizations-international enterprises coincide in the fact that the business (sale-purchase of the product, disbursement-payment of the loan and execution of the project) works, not so much that the cooperative works.

They are content with the protocol, written and legal proof about the functioning of the cooperatives, proof that the elites of the cooperative learn to quickly fabricate: minutes that prove that the organs meet, audits with authorized signatures, financial and narrative reports including registry of data, and even members “trained” to repeat what the organizations want to hear, when some organizations visit. This practice, in turn, is read by the members as something that confirms their ideas that the cooperative does not change at all their way of working and selling their products: “If the organizations says that it is fine, surely it is fine, as we have always worked.” This is the formal structure that covers over the fact that the cooperative does not distribute its surpluses in accordance with its own rules, and the millennial aspiration of indigenous and peasant families.

“The peasant is interested in selling his product, he is not interested in whether there are surpluses”. This phrase presidents and managers of cooperatives repeat, along with buyers and international aid agencies, as well as technicians and boards of NGOs. This phrase underlies century old institutional practices. What are they? It is the institutionalized idea in the hacienda owner or the capitalist, that they have the exclusive rights to surpluses, that the peasantry were born to sell their labor and/or their raw materials. It is the same idea that the peasantry reproduces: “My country ends with my fence of piñuelas”, says the peasant family; “they pay my wage, that is all I ask”, says the working person (field-hand or peon); they never ask themselves about the surplus that their work or their product generates, they take it as given that it is not theirs. That institutionality absorbed the cooperatives and made them forget about the reason for their origins and their rules for distribution, and with that buried even more that indigenous-peasant right to the value that their work creates. So it is that the members demand that they increase the price of their sun-dried coffee, cacao pulp or their sugar cane; in some cases they demand an “adjustment”; “if we got credit as a cooperative so that you pay us a certain price for coffee, and if you paid us as the market price a little less than that set price, then pay us the adjustment”; no one demands their surplus; the presidents and managers behave like the hacienda owner or capitalist.  Figure 2 illustrates this institutionality: the worker reaches the wall of their days wage, the peasant their fence of piñuelas, the “business foot” of the cooperative goes as far as the “wall” of the port, and the buyers-roasters-distributors to the sale or even the cafeteria. Each one, and in each wall, seem to follow the rule of “I don´t touch you, and you don´t touch me.”

Second, the organs of the cooperatives are left bound up, because their rules are replaced by others that respond to what Polanyi (2001)[8] called the “market society”, and respond to colonial and patriarchal structures. One of those rules is: “To distribute, first you have to grow.” This rule comes from neoliberalism, that “economic growth is development”, from trickle-down economics: capturing the wealth of the members so that the cooperative might invest and accumulate in the short term, and benefit the members in the long term. This “development” and that “long term” with “benefits”, nevertheless, tends not to arrive; in other words, “they do not pay back”. Consistent with neoliberalism, the cooperatives assume that “distributing decapitalizes the organization” and they embark on the path of the “big headed dwarf”, whose head is large and is made of steel (concentration of physical investments and resources), and whose feet are clay (impoverished members who do not participate in the decisions of their organizations nor rotate offices). In this logic the managerial staff or the president tend to end up feeling themselves to be the true owners of the resources of the cooperative, that it is “their effort”, while the board members tend to abandon the volunteer nature that their offices imply, and seek any gap to take advantage individually, be it through travel allowances, loans on top of loans, or benefitting themselves from the donations that the cooperatives eventually might receive. Also consistent with neoliberalism, the fair trade and direct trade bodies reduce their relations with the cooperatives to just the financial aspect, and treat the cooperatives as just “businesses”.

Distribution, expressed in colonial rules, says to the members: “We always need a patron.” The field-hand depends on the patron, who “provides” for him (future purchase of his labor), like the peasant depends on the trader who “provides” for him (future purchase of his product). For them, this “providing for” is the best “distribution”; they know no other. This is what penetrates into the cooperative where the members confirm naturally that they never had rights to the surplus.

Distribution is also expressed in the heart of the family. There, the patriarchal rule says, “The father decides to leave the inheritance to the eldest son, and that will be carried out when he dies.” That will is conceived as something sacred. The family is an institution that attracts resources because of the family labor of its members, and in the end “pays back” (inherits) in an unequal way, leaving tacit that that older son is going to distribute the inheritance among his brothers and sisters, and what happens? Not always, but generally, that older son takes over the inheritance, or sells it and squanders it. That family institution also penetrates into the cooperative, where many times the person who occupies the presidency or management is seen like that “eldest son”, while the rest of the members are submitted to his will, in spite of the fact that they are the “parents” (owners of the cooperative) of that “eldest son.”

The cooperative, guided under this capitalist, colonial and patriarchal spell, tends to start with enthusiasm and when it capitalizes, the board members or the administrative staff turn into elites, exclude those who question them, and privatize the cooperatives. Thus, W. Berrios, from the CAFOD aid agency, observes, “In my years of work in Central America I have seen that it is in the maturation curve that the cooperatives go broke.” Infrequently they restructure the cooperative into a private enterprise, but many times they make it function as a private enterprise sheltered under the legal status of a cooperative, or under the discursive mantle of the social and solidarity economy.  In both cases the members are treated as simple sellers of raw materials.

Finally, there is dovetailing between the mentality of international organizations (buyers, banking institutions, certifiers and aid agencies) and that of the members. The international organizations turn a blind eye to the lack of compliance with the rule of distribution, because, following Streeck (2019), “the policy of distribution only function in nations; in world society there are donations,” global governance “is not democratic”, because “above the nation-state there is only the “international free market”, which consists in large enterprises that are free to do whatever they want.” That mentality leads them to have a mentality of turning a blind eye to distribution, which coincides with the mentality of the members, who have never had access to surpluses, they always saw them as something that belonged to the patron or intermediary, from there it is that the members also turn a blind eye to their right that they be “paid back” (distribute) the surplus. This is what Figure 2 expresses with the walls, “I don´t touch you and you don´t touch me.”

3.    Distribution of the surplus (“paying back”)

How can cooperatives unbind this adverse triangle and distribute the surplus? By distribution people tend to fall into two beliefs: that it is “distributing financial surpluses” and that it is “distributing all the surplus to the members.” From here comes the idea that “distributing is decapitalizing.” In this section we break down what equitable distribution of surplus is, expanding the content of the distribution already described in the rules of cooperatives.

Let us start with the attached graph. This illustrates the components of this “paying back” that include collective forms (legal reserve, reinvestment fund and social fund), and the individual forms that the members receive directly (distribution to members and payments when they leave the cooperative). The percentages in the graph are arbitrary estimates, they vary depending on the laws in each country, and the decisions of the cooperatives agreed upon in their statutes.

Note that this graph breaks with the belief that “distributing decapitalizes”: the reinvestment fund refers to the fact that their own fund or their own “capital” grows in accordance with the percentage approved in the cooperative. The assumption in the graph is that exercising distribution in the five ways, combination of collective-community and individual distribution, builds trust and loyalty, which makes the members turn in their products to their organizations in larger amounts and with better quality; from here distribution instead allows the economic transactions of the cooperative to increase, and therefore the entirety of their funds grow; in other words, ”decreasing” (paying back or distributing) is “growing” in resources. The graph also shows the underlying reason for cooperativism, that it is not to accumulate just to accumulate capital, the cooperative is a means, and the members and their communities are the end (final objective). We break down these funds in what follows, including some important remarks.

3.1  Components of collective distribution

Let us describe those funds that are in the statutes, let us clarify and add what they can have which is unique. “Legal reserves” is to cover losses that eventually the cooperative might have during the year in the economic fiscal year; it is a financial cushion that prevents the cooperatives from going broke. In the case that there are no losses, that reserve could swell the investment fund, or, for example, cover legal paperwork expenses, the opening or updating of bank accounts, the legal defense of the cooperative in the face of lawsuits from third parties, the legal defense of the members in cases that affect the cooperative, or to have legal counsel in the face of certain situations or issues.

“Cooperative fund” or “reinvestment fund”, belongs to the cooperative. In addition, some buyers tend to increase the price of the product that they buy with a “cooperative premium” or with an “infrastructure fund”, resources that are added to the funds of the cooperative. These funds are to buy equipment that the cooperative might need, repair or enlarge the infrastructure (building, harvest collection center) of the cooperative, and/or to increase the funds of the cooperative itself, which would increase the loan portfolio, or would pre-finance the payment that the members make on receiving products, while they process and sell them – avoiding the need to seek outside credit.

“Social or educational fund”. It is a fund from the rules of the cooperative itself, and is a fund that increases if the cooperative sells its product through fair trade organizations or buyers that condition a certain amount for a social fund. In general, cooperatives use it to finance some demand of the community school, provide backpacks to the children, provide support to the local sports team, or for trainings that their education committee might organize. Even though these initiatives are praiseworthy, physical investment in the school is the obligation of the State for which society pays taxes. The sports teams are going to function with or without the support of the cooperative, the children will go to school with an old or new backpack. Some innovative cooperatives use that fund under the following criteria: invest in something that generates value for the community, that is not the role of another institution, and doing so as a long-term investment. An example of this is the fact that two or three cooperatives from the same community might invest in libraries for children under 7 years of age, story books that their families might borrow to read to them before going to sleep, promoting reading in the family itself, and that the cooperative might organize reading circles with the support of people who promote reading; the long-term impact of this initiative in the creativity and cooperative spirit of the community can be significant.

3.2  Components of individual distributions

Following graph 1, 50% of the surplus of the cooperative is distributed to its members directly. The criteria for that varies from cooperative to cooperative, and depends on the services that they offer. In some cases, it is in accordance with the contributions of each member. In other cases, it is in accordance with the volume of product transacted with the cooperatives that collect the harvest and sell the product of its members. In other cases, it is in accordance with the quantity of products bought in their cooperative. And in other cases, it depends on the amount saved in their cooperative. There are cooperatives with similar services, and that “pay back” under different criteria; for example, the peasant store Los Encinos in Honduras “pays back” 100% of the amount of the agreed upon contribution, while the Esperanza of the Campesinos Cooperative with several supermarkets, “pays back” based on the amount that each member buys from those supermarkets.

These criteria promote the capacity of each member, and increase their trust in the collectivity that the cooperative is. There are members with more financial capacity and do not necessarily have larger contributions in the cooperative; it depends on the trust that the members have in their cooperative, and on the opportunity cost that each member thinks their resources have. In this sense, the biblical parable of the talents (Mt 25: 14-30) illustrates part of what the cooperative looks to incentivize with direct distribution; in that parable three people receive talents, one 5, another 2 and another 1, “in accordance with their capacity”. After a time, the person who received 5 and the one who received 2 double theirs, and the one who received 1 maintained it. In light of this, the person who gave them the talents rewarded the first two, and took away the only talent from the third, “because he who has, will be given more, and they will have an abundance, but he who does not have, even what they have will be taken away from them.”

From the religious context, this indicates that God gives people talents in order to develop them, which reveals an individual vision, where each person is responsible for duplicating their talents. From the cooperative context, one is “paid back” in proportion to the trust and loyalty of that member, demonstrated by contributions, savings, delivery of product or amount purchased; that “payback” is not taken away from them in the cooperative, in contrast with what happens in the parable of the talents, where each individual responds individually with the talents received; instead, there is cooperation among the members mediated by commonly agreed upon rules, compliance mechanisms and there is accompaniment so that each member might increase their capacities; there is individual responsibility within the framework of collective responsibility.

3.3  Compensating by rights those who resign from the cooperative

Following cooperative statutes, the member who resigns from the cooperative has the right to the return of their extraordinary contributions, and the “reimbursement of social assets” (shareable surplus) within a term generally of 90 days. This “departure” arrangement should be thought of and agreed upon from the beginning when the cooperative is founded, even though it is clear that in the beginning, being immersed in making the cooperative survive, no one thinks about this; it should be done, because it is thinking about the future, and because each member should be clear about their rights from the very beginning[9].

In our societies the member who resigns from the cooperative tends to leave without recovering, many times, not even their contributions; likewise, those who die, their relatives do not tend to receive any benefit that by rights the family members are due. For some members, having joined a cooperative is even a financial loss. In the case that there are voices that are raised about this, some board members pull out the ghost that “distributing is decapitalizing”.

If the cooperative does not pay the member who resigns, or the relatives of those who die, in accordance with their rules and the rights of each member, the cooperative signals distrust in its own future, and sends an erroneous message that they are not members, that the “cooperative does not belong to its members”, which undermines any sense of ownership of those who stay in the cooperative, and those in the community who observe it. If in contrast, the members fulfill the rights that each members has on leaving the cooperative, that they be paid the part that corresponds to them that the cooperative has at that moment, probably that person will leave with a good amount of resources, and happy for having been a member of a coop. In the short term, this is a hard moment for the cooperative, because it is going to disburse in cash resources what it surely needs; at the same time, each member will see themselves in the person who resigns: in the same way that they treat the person who leaves, they will treat me. If the member joined the cooperative with little, and leaves with a good amount of resources, those who remain will ask themselves: if after the cooperative fails, will we be the most unlucky ones? The doubts will keep them up at night. But in the long term, those who are left are less, which means that they will receive more from the future resources that the cooperative accumulates; more than that, each member, seeing that the one who left took what corresponded to him, will confirm that in truth he is a member of the cooperative, that the cooperative really does belong to him.

Let us talk about numbers to estimate the amount that could be due to a person who resigns. What is the arrangement with the member who leaves? A member who leaves or dies, that person or their relatives have the right to part of the assets or resources that the cooperative has generated. Let us help ourselves with an example. If through the use of the “cooperative fund” or the “reinvestment fund”, extraordinary contributions of $100 per member, and donations that the cooperative received, a cooperative has assets valued at $200,000; if that cooperative had 20 members at its founding 10 years ago; then if one of them resigns from the cooperative, they are due $10,000 (200,000/20 = 10,000). This amount could be paid over a term that the statutes indicate, or, if the cooperative does not have the $10,000 available, they can arrive at friendly arrangements for the time frame for the payment.

The biggest impact of this fact, nevertheless, is not in the financial “payback”, but in the fact that the 19 remaining members, and the rest of the community, confirm that effectively the cooperative does belong to its members. This is the seed of incomparable ownership. This implies greater trust, loyalty and the deployment of individual and collective capacities.

Concluding this section, distribution in the cooperative generates equity, and incentivizes the development of each member. An estimate of 40% of the surplus protect the cooperative from losses, increases their investments or their own capital fund, and contributes to the community with unique investment in education. With an estimated 50% of the surplus, the cooperative incentivizes the development of the capacities of each member, their trust and mutual loyalty. And with an estimated 10% of the surplus, the cooperative ensures the recognition of members who leave the cooperative, far from seeing it as a “financial loss”, they recognize the rights of the cooperative member and with that plant the seed of ownership. This collective and individual outcome is the way in which the cooperative distributes its surplus with equity, which is connected to the virtuous peasant institutions of giving-receiving-paying back, expressed in shared labor, sharecropping, and shared harvesting, among other institutions.

Now that distribution with equity appears obvious, along with its importance. How can it be carried out?

4.    How to implement equitable distribution

Inequitable pay back… breaks down the organization

The Spanish, Mexicans and US tried to dominate the Apaches; they failed. The Apaches had the nant’an as their leaders, they were decentralized, operated in circles. Their adversaries, as they did with the Aztecs and the Incas, did away with the

nant’an, but the Apaches did not fall apart, immediately another nant’an would emerge. But one day the North Americans donated cattle to the nant’an; since cattle were scarce, the nant’an had the power to distribute them, so everyone wanted to be nant’an, the egalitarian power structure became hierarchical. The Apaches were defeated.

(Based in Brafman, O. and Beckstrom, R.A., 2007, The spider and the starfish. Barcelona: Empresa Activa).

This historical passage shows us that distribution is more than distribution of surplus. It is important to have holistic egalitarian structures that include equitable rules and mechanisms for carrying them out. Before continuing, we cannot avoid comparing this event of the Apaches with the action of the government in the parable at the beginning of this article; the government in the parable, and the North Americans in this other one, seek to subordinate the cooperative or the Apaches, the first donates land to them, and the second donates cattle, in both cases without “payback”, thus they undermine them before their members, leave them not looking toward their community, which causes the cooperative and the Apaches to fall apart. Militarily the Apaches were indomitable, but a simple donation eroded their entire organization, like termites on wood. How did this happen?

The Apaches lacked equitable rules for the distribution of assets donated to their leaders. The North Americans took advantage of that gap, and donated the asset that was the scarcest, cattle, directly to the nant’an and not to the Apache tribe that surely had their own organization. This practice internally stirred up the Apaches, who fought over being nant’an, for having that connection to the North Americans and accessing the cattle; surely, like the managers or presidents in conventional cooperatives, the nant’an said to their tribe that the “cattle had cost them”, that they should be content with what “trickled down”, that they were their “connections”, and that without them they would all die of hunger -or in other words, the evil of the “big headed dwarf” began to corrode the minds of the nant’an and sow distrust in the rest of the tribe. This process led them to become hierarchical structures, and consequently to collective failure; it is what has also happened to most of the conventional cooperatives.

Cooperatives, in contrast to the Apaches, have rules and mechanisms for equitably distributing the surplus (including donations), but they lack democratic processes in their functioning, which is why they do not comply with their rules for equitable distribution. In many cases the cooperatives were started by the State with donations in land or other assets, undermining them from their own beginnings. International organizations (buyers, financiers and donors) have continued on this same path. Like the North Americans with the Apaches, they only connect with the nant’an of the cooperatives (managers or presidents), and they are not interested in knowing the consequences that their actions provoke. How can cooperatives fulfill their rules and make distribution their most valuable attribute for growing equitably?

This point about the Apaches leads us to understand that a cooperative that distributes its surplus with equity is that which, in addition to having rules for it, is democratic and transparent: See Figure 3.

If the organs, in democratic exercise, ensure the fulfillment of the agreements about equitable distribution, that cooperative will embark at a good port. In the case of the Apaches, their organs operated around resisting militarily, including their food, but they lacked the rules for donations and relationships with external actors. We can imagine that the Apaches, in decentralized groups, hunted animals for food; for which they had their rules and they applied them, but not so that some nant’an individually might receive 10 head of cattle as a gift behind the backs of the tribe, even precisely for their tribe.

This combination (rules-democracy) requires, nevertheless, a third foot: transparency. It is depressing to find members who after contributing for 5, 10 or 15 years do not know how to add up their contributions, and that do not recognize their rights over the surplus. It is not just having democratic economic management coherent with the rules themselves and the rotation of members in the different offices and decision making in the corresponding organs, but informational transparency with the members and with the allies. The idea of transparency or accountability in the cooperative is not being subject to trial, measured and humiliated by “the magic of the numbers”. It is sharing information that in turn forms and commits the members. A member can understand that their surplus might be $30 per qq of coffee that they have delivered to the cooperative, if he is informed about how that surplus was produced; otherwise that person will see that surplus as “an award” or a “favor” of the patron, as his historical rules make him see it. Distributing surplus implies distributing responsibilities (democracy) and information; the way “the legal reserve”, “investment fund” and “social fund”; the expenses and income… were produced and used. This information forms people and commits them: the member, based on transparent information, will want to participate in the definition of the goals for the year for their cooperative, and will want to be part of the implementation of those goals, because he recognize that his individual surplus will increase, that the benefits to his community will improve, that if the cooperative increases its reinvestment, any member who leaves will be able to go with more resources. In addition, if the first tier cooperative is a member of a second tier cooperative, the member also needs to be informed about the second tier cooperative, know how surplus is generated in that organization, and how much is due his cooperative, and how much of that amount is due each member. That explanation can happen in an assembly, in visits to each member family, on whiteboards or through brochures, and on the day of the distribution of surplus, combine festivities and information.

Correspondingly, transparency implies being accountable; for example, it is commendable that the credit record include columns for the amount of credit, amount past due and contributions; it is also commendable that the record include the amount that the member is leaving for “legal reserves”, “social fund” and for the “reinvestment fund”; the first format for the record contains control information for the member, and the second format has the accounting of the cooperative to its members. Being accountable in the assembly about their resources expresses the rights of each member, and it is an obligation of the cooperative that each member know that. From here, if the members are informed about each step of their cooperative, they will be committed to their cooperative, if their cooperative faces difficulties, they will sweat the fear of failing and will row the canoe together even in the midst of the biggest waves.

Equitable distribution is possible within a framework of democracy and transparency. There, being a cooperative member is thinking beyond salary, beyond raw materials and beyond exported product; it is thinking about the entirety of the cooperative, and the entirety of the chain of actors where value is created. In other words, it is breaking down the walls of Figure 2 and understanding that what creates value is the human work of the working person, producer, processer, importer, roaster and seller of the coffee in the stores and coffee shops. It is “I touch you and you touch me”, entering into different worlds. This implies including the international organizations and companies, which goes in the direction of global triangulation that we worked on in several other articles, about an alliance of actors that work for equitable distribution.

5.    Conclusions

You read a book from beginning to end. You lead a business just the opposite way. You start with the end, then you do what you have to in order to achieve it.

Harold Geneen, 1984, Managing. New York: Double-day

At the beginning of the article we asked ourselves how cooperatives can distribute (“pay back”) in order to grow with equity. Equitable distribution in a renovated cooperative is very different from the distribution of the market in the neoliberal economy, which is one unilateral way, from society to businesses and institutions, from which there is no “pay back” beyond what “trickles down”.

In the renovated cooperative, and in alliance with global actors, equitable distribution is illustrated in Figure 4.

It is the distribution of surplus combining the collective (social fund, reinvestment fund, and legal reserves) and the individual (direct distribution to the member for their differentiating actions and payment of what by right is due the member who leaves); it is financial and social distribution. Then, equitable distribution implies that the organization be democratic (rotation of officers, collegial decisions and compliance with the rules). Then equitable distribution implies distributing information under the maxim that the more informed the members are, the better their decisions will be.

This notion of equitable financial, social and political distribution (democratic and transparent), mobilize energies and hearts when it is connected to the endogenous institutions of the members, in our case, the peasantry. Consequently, each member feels part of the cooperative, seeks to know its goals, have an impact on them and commit themselves to fulfilling them.

Finally, when the members and their global allies follow equitable distribution connected to endogenous institutions, that is when they see the entirety of the cooperative and the entirety of the value-added chain with equity. Far away are left the “walls” that separated the worlds. Paraphrasing Harold Geneen, we organize a cooperative from its end, from its equitable distribution to the benefit of the members and their local and global communities. The more that is distributed, the more that it grows.

[1] René has a PhD in development studies, is a collaborator of the Winds of Peace Foundation, member of the COSERPROSS cooperative, and associate researcher of the IOB-University of Antwerp (Belgium). rmvidaurre@gmail.com

[2] Mauss (1979: 204-211), based on a type of distribution known as potlach, practiced in Eskimo societies in the Northwest of the US, finds the triple obligation of the gift culture: giving, receiving and paying back. “You do not have the rights to reject a gift, a potlack, because acting in this way makes clear that you are afraid to have to pay back and be left diminished, it is losing the “importance” of your name, it is declaring oneself beaten in advance, or in some cases proclaiming oneself victor or invincible” (p. 208). Marcel Mauss, 1979, Ensayo sobre los Dones. Motivo y forma de cambio en las sociedades primitivas, en: Sociología y Antropología, Madrid. Note that this identified institution is pretty similar to institutions of indigenous communities in Latin America.

[3] Polanyi, K., 1976, El sistema económico como proceso institucionalizado, en: Antropología y Economía (ed. Godelier, M.), Barcelona pp. 155-178

[4] Santana, M.E., 2014, “Reciprocidad y Redistribución en una Economía Solidaria” in: Ars & Humanitas 8/1. Slovenia.

[5] Surpluses result from deducting costs and expenses of the cooperative, amortization (value for deterioration of fixed assets). In associative organizations the term “profits” is used more, which is pretty similar to “surpluses”. The term “earnings” is different, there could be earnings through a discount if a product is sold above its acquisition price.

[6] W. Berrios, from the CAFOD aid agency, refers to the fact that some aid agencies linked to churches in Europe tend to withdraw their support for organizations that in theory assume the social and solidarity economy approach, but in practice do not follow it, and that instead become part of conventional mediation.

[7] Several buyer companies left Fair Trade on realizing that their premium payments were not getting to the member families, so they formed another movement called direct trade, to get around “cooperative mediation”. There are also European enterprises and cooperatives that buy coffee or cacao in Central America and want the cooperative that they work with to distribute their surpluses; correspondingly, some of them avoid the second-tier cooperatives and prefer buying directly from the first-tier cooperatives.

[8] Polanyi, K., 2001, The Great Transformation: The Political and Economic Origins of Our Time. Second Edition. Google Books. (First publication in English in 1957).

[9] See: Jack Stack, 2002, A Stake in the Outcome, New York: Doubleday. Stack, along with other workers, founded an innovative enterprise in the United States. In this book he recounts how they struggled with this issue from the beginning of their company. If they did it as a company, how much more should a cooperative!

Bleak House

“It is said that the children of the very poor are not brought up, but dragged up.”                                                    Bleak House, by Charles Dickens

It’s an image that is haunting, and daunting, this observation from 1852 Victorian England:  the idea that some children- many children, in fact- in the very prime of their learning and forming years were forced to find their way to young adulthood through the hauling  and heaving of desperate poverty and abuse.  It was a reality distinctly at odds with the Victorians’ self-proclaimed progressive era of reform and improved societal standards.  Author Charles Dickens made his mark, in part, chronicling the sad realities of the time.

That was a long time ago.  The pokes at our collective conscience by Dickens have persisted since his time, as his works are among the most revered and widely-read in the English language.  As a result, we should have every reason to expect that, with the passage of time and a presumed greater enlightenment about healthy societies, our nurture of children might have changed since 1852.

Not so.

Dickens would find endless fuel for his anger today.  Even a short visit to the Mexico-U.S. border would engender sufficient affront for him to create two volumes the size of Bleak House.  The experiences of border children is little better than those endured in the streets of London more than 150 years ago.  The realities of the War in Yemen have claimed 85,000 children under the age of 5 since 2015,  more than enough to flame Dickens’ sense of outrage.  The outlook there suggests the potential demise of another 14 million people over the next several years.  And if the well-known writer deigned to travel to the U.S., he would be dismayed to learn that the British progeny has fostered more than 16 million hungry children in 2018.  If Dickens took a side trip down to Nicaragua, he would encounter children facing family upheavals, disappeared parents, and poverty that is among the worst in the entire Western Hemisphere.  He might begin to wonder whether his famous works really made any impact at all.

I’ve re-read a number of Dickens’ classics in recent years, including Bleak House, Our Mutual Friend, Oliver Twist and A Tale of Two Cities.  I’m drawn to his characters and the ambience of the times in his writings.  But I also find myself distracted by the conditions encountered by many of his characters, especially the children.  The stories are uncomfortable.  The children’s circumstances are often abhorrent, to the point occasionally when I think that Dickens has likely exaggerated the realities faced by his young protagonists.  But I read on in the certain hope that things will get better by the tale’s end.

Dickens’ hopes for any kind of empathetic reforms or changed sensitivities as a result of his works would be shattered in the face of today’s world.  The travesties of Victorian England are comparatively small compared to the cold calculations of despots today. Reading fictional accounts of treachery and evil pales in comparison to the very real atrocities that we tolerate repeatedly on the world stage today.

A Christmas Carol delights audiences because of its ability to take us from the depths of human greed to the pinnacle of generosity and redemption.  It makes us feel good in the hope that it creates for eventual justice.  I wonder if Dickens would be inclined to write very different conclusions to his stories today….

 

 

 

 

Well Said

From time to time I have reproduced the writings of others at this blog site, because they have stated ideas so powerfully.  I have elected to do it again, given the words written by Kathleen at the Center for Development in Central America  (CDCA).  Kathleen has been quoted here before because what is in her heart is so well said in her words.  The following is excerpted from the CDCA May 2019 newsletter.

My mother has said over and over that one of the two things Jesus wished he had never said was, “The poor you will have with you always.”  Why?

Because so many Christians use that phrase to justify pouring money into church buildings and doing nothing for the poor.  But what if we re-examined that phrase, and instead of looking at it as meaning an impossible goal of eradicating poverty, look at that phrase as an indictment of the rich?

It is true that, “There is enough in the world for everyone’s need, but not enough for everyone’s greed,” a quote from Frank Buchman.

Staying with my daughter in the Northeast, it is easy to let the poor slip my mind.  As she recuperate from surgery, my daughter is watching mindless television so she can crochet and heal.  One of her shows is “Top Chef.”  I have found it addictive but also, when I remember the poor in Nicaragua, nauseating.

In Nicaragua with climate change and with the socio-political crisis there, people are looking more and more at hunger.  It is easy to forget that as the Top Chef judges say to a contestant that the prime rib was not plated to please the eye.

It is easy for the wealthy or the intellectual class in Nicaragua to create and foment a crisis when their children will be fed and given medical care or even schooling if a new government comes in and discontinues social programs.

It is easy to forget that people are sweating and bearing unbelievable heat when there is cool air at a touch.  When you have food to eat and can jump in an air-conditioned car, it is easy not to feel the urgency that climate change should be our top priority (when diesel prices had dropped, one opposition leader said that the Nicaraguan government was doing the people a disservice by investing in renewable energy!).

A Brazilian priest, Frei Betto, helps those of us who would say we choose to stand with the poor by telling us that, “The head thinks where the feet stand.”

He says that, “It is impossible to be a leftist without dirtying one’s shoes in the soil where the people live, struggle, suffer, enjoy and celebrate their beliefs and victories.  To engage in theory without practice is to play the game of the right.”

Many tell us that our opinion of what is happening in Nicaragua is just wrong, and maybe it is; but Fr. Betto also says, “Choose the risk of making mistakes with the poor over the pretension of being right without them.”

And so, we risk the mistakes….

Thank you, Kathleen….

 

 

Chicken Feed

This Easter has been a sweet deal for candy manufacturers: more than $2 billion was spent on candy alone this season, and the overall spending on all Easter-related purchases figures to be the second-highest in U.S. history.  (I know that I didn’t receive any chocolate bunnies on Easter Sunday, so somebody else has been taking more than their share. ) But it started me thinking about wants and needs and central Easter messages.

That candy cost isn’t exactly chicken feed.  By comparison, the total amount of all U.S. aid to Nicaragua in 2017 was $31.3 million, 15% of all that candy.  I only offer the comparison here for contrast; neither I nor most Nicaraguans would argue for greater aid dependency on the U.S.  But it’s quite a difference in sums when one considers the two categories: resources for basic human living standards in Nica versus Easter candy consumption in the U.S.   Setting aside such notions as national boundaries, something seems inequitable in all of that, no matter to what political or economic perspective one may subscribe.  Let me elaborate.

I spent a week with my colleague Mark in Nicaragua last month, visiting with rural partners, hearing about their struggles with various harvests, understanding the need for late repayments in several cases, and attending a two-day workshop designed to teach information analysis, so that these producers might go about their work on a more data-driven basis.

Our week did not represent some kind of hight-level financial development.  We lunched with them on rice and beans.  We spoke with some, in impromptu huddles, about small loans and the most basic tenets of our partnerships: accompaniment, transparency, functioning bodies of governance, broad-based participation, and collaboration within the coops.  We described the nature of goals and goal-setting.  They asked us about work processes.  We laughed some.  The interactions may have been at their most basic level, but they were important and appreciated.  Basic stuff usually is.

What does any of that have to do with Easter candy sales?  Simply this: the sweet taste in the mouth from a dissolving Peep or jelly bean is both artificial and temporary.  And it can never take away the bad taste in the mouth from the recognition that we spend more on candy than on the very lives of others who are in significant need for their basic survival.  That bad taste comes from recognition that our own lives are made up of moments, moments of priority and precedence, wherein we have the free will to decide how we will spend our time and our money and our spirit.  Those decisions impact the impoverished in profound ways, and as importantly, paint the portrait of who we truly are.   And they do leave a taste in the mouth, one kind or another.

Last month in Nicaragua I heard the observation of a producer who was considering the raising of a few chickens as a supplement to his coffee-growing efforts.  His words of hesitation were like a fist to the gut.  “The corn that my hens eat,” he observed, “could be food for my family.”  He was not speaking about candy corn.

Easter is a season of resurrection and salvation, of new beginnings and new chances.  It is a time of reflection for many about the life and example of Jesus and the basis of those who claim followership of his teaching.  It also gives me pause to think about the price of candy and the value of corn….

 

 

 

Our Mutual Enemy

I’ve taken to re-reading the Charles Dickens classic tale, Our Mutual Friend It’s Dickens’ last work, a long piece of literature that captured my imagination as a young man and for some reason (perhaps the recognition that if I ever intended to re-read it, I’d better get going), I decided to tackle it again.  It’s full of lessons and observations about Victorian (and modern) life, as well as those long and circuitous sentences with which Dickens was so adept.

Dickens’ focus on the great disparities in Victorian London are well-known, such as in his tale,  A Christmas Carol.  But I ran across a passage in the current book that I simply couldn’t pass up for sharing.  One doesn’t really need to know the context of the story or the characters to understand the clarity of the message.  It reads like this:

In the meantime, a stray personage of meek demeanour, who had wandered to the hearthrug and got among the heads of tribes assembled there in conference with Mr. Podsnap, eliminated Mr. Podsnap’s flush and flourish by a highly unpolite remark; no less than a reference to the circumstance that some half-dozen people had lately died in the streets, of starvation.  It was clearly ill-timed after dinner.It was not adapted to the cheek of the young person.  It was not in good taste.

“I do not believe it,” said Mr. Podsnap, putting it behind him.

The meek man was afraid we must take it as proved, because there were the Inquests and the Registrar’s returns.

“Then it was their own fault,” said Mr. Podsnap.

The man of meek demeanour intimated that truly it would seem from the facts, as if starvation had been forced upon the culprits in question- as if, in their wretched manner, they had made their weak protests against it-  as if they would have taken the liberty of staving it off if they could-  as if they would rather not have been starved upon the whole, if perfectly agreeable to all parties.

“There is not,” said Mr. Podsnap, flushing angrily, “there is not a country in the world, sir, where so noble a provision is made for the poor as in this country.”

The meek man was quite willing to concede that, but perhaps it rendered the matter even worse, as showing that there must be something appallingly wrong somewhere.

“Where?” said Mr. Podsnap.

The meek man hinted Wouldn’t it be well to try, very seriously, to find out where?

“Ah!” said Mr. Podsnap.  “Easy to say somewhere; not so easy to say where.  But I see what you are driving at.   I knew it from the first.  Centralization.  No.  Never with my consent.  Not English.”

An approving murmur arose from the heads of the tribes; as saying, “There you have him!  Hold him!”

He was not aware (the meek man submitted of himself) that he was driving at any ization.  He had no favorite ization that he knew of.  But he certainly was more staggered by these terrible occurrences than he was by names of howsoever so many syllables.  Might he ask, was dying of destitution and neglect necessarily English?

You know what the population of London is, I suppose?” said Mr. Podsnap.

The meek young man supposed he did, but supposed that had absolutely nothing to do with it, if its laws were well-administered.

And you know, at least I hope you know,” said Mr. Podsnap with severity, “that Providence has declared that you shall have the poor always with you?”

The meek man also hoped he knew that.

“I am glad to hear it,” said Mr. Podsnap with a portentous air.  “I am glad to hear it.It will render you cautious how you fly in the face of Providence.”

In reference to that absurd and irreverent conventional phrase, the meek man said, for which Mr. Podsnap was not responsible, he the meek man had no fear of doing anything so impossible; but-

But Mr. Podsnap felt that the time had come for flushing and flourishing this meek man down for good.  So he said:

“I must decline to pursue this painful discussion.  It is not pleasant to my feelings; it is repugnant to my feelings.  I have said that I do not admit these things.  I have also said that if they do occur (not that I admit it), the fault lies with the sufferers themselves.  It is not for ME- Mr. Podsnap pointed ME forcibly, as adding by implication though it may be all very well for YOU- “it is not for me to impugn the workings of Providence.  I know better than that, I trust, and I have mentioned what the intentions of Providence are.  Besides,” said Mr. Podsnap, flushing high up among his hair brushes, with a strong consciousness of personal affront, “the subject is a very disagreeable one.  I will go so far as to say it is an odious one.  It is not one to be introduced among our wives and young persons, and I-“

He finished with that flourish of his arm which added more expressively than any words: ” And I remove it from the face of the earth.”

It is an easy thing to simply banish disagreeable realities with a sweep of the arm.  Or to claim that something is true when it is not.  But doing so does not change the realities or absolve us from the human stewardship that we owe to one another as fellow-travelers on this earthly journey.  Dickens knew it.  And as unpleasant, repugnant, disagreeable and odious as it may be, so do we all….

 

Creating S***hole Countries

I’ve continued to think about the comments made last week by the President of the U.S.  Even though he later denied some of the words attributed to him, and two of his most ardent supporters stated that they did not recall his use of the words, there seems to be little doubt about what was actually said and why.  The entire episode was astonishing to those with any sensibilities, regardless of political affiliation.

But my own reflections on the matter shifted to the countries in question, the ones which were denigrated so graphically by the leader of the free world.  What’s the possible basis for such demeaning remarks?  Are these nations really so awful?  And if so, why?  I suppose that, by comparison, Nicaragua might be one of those countries which the U.S President had in mind: it’s the second-poorest nation of the Western Hemisphere (next to Haiti), has a history of internal conflicts and dictatorships, contributes to both legal and illegal immigration to the U.S. and has sustained a strained relationship with U.S. administrations for decades.  With that in mind, I considered the circumstances that might have led countries like Nicaragua, Haiti and the African nations to be held in such contempt by the wealthiest country in the world.

At least in the case of Nicaragua, the beginning of their modern-day difficulties date back to the 1850’s invasion of that country by invasion from the U.S.  Over subsequent decades, the North American neighbor alternately funded insurrection, invaded with U.S. Marines, supported a generations-long dictatorship of oppression, illegally funded a war against a duly-elected Nicaraguan administration, ignored a World Court penalties of $6 Billion for their illegalities, consistently and forcefully interfered in elections and has recently threatened legislation to eliminate U.S. remittances to Nicaragua families.  In sum, it has been an excellent recipe for the creation of a troubled existence.

In Haiti, the early troubles inflicted by the U.S. were quite similar to the incursions in Nicaragua.  On July 28, 1915, American President Woodrow Wilson ordered  U.S. Marines to occupy the capitol.  Forces were instructed to “protect American and foreign” interests.  The U.S. also wanted to rewrite the Haitian constitution, which banned foreign ownership of land, and replace it with one that guaranteed American financial control.  To avoid public criticism, the U.S. claimed the occupation was a mission to “re-establish peace and order… [and] has nothing to do with any diplomatic negotiations of the past or the future.”  Within six weeks of the occupation, U.S. government representatives seized control of Haiti’s custom houses and administrative institutions, including the banks and the national treasury. Under U.S. government control, a total of 40% of Haiti’s national income was designated to repay debts to American and French banks.  For the next nineteen years, U.S., government advisers ruled the country, their authority provided by the United States Marine Corps.  The U.S. retained influence on Haiti’s external finances until 1947.  It was a good way to subdue a culture, an independent economy and self-determination and to ensure their third world status.

For the African continent, the litany of U.S. interventions and self-serving intrusions is far too long to even summarize here.  Africa is a big place, and nearly every one of its fifty-four countries has experienced U.S. interference at one point in history or another.  But the following description of cause-and-effect, excerpted from an article by Mark Levine at aljazeera.com provides some context for current reality:

Traveling across Sub-Saharan Africa it becomes a truism—but nonetheless in good measure true—that the areas where the region’s much-celebrated recent growth is most evident are precisely where people are able to create local markets largely outside the control of corrupt government and private elites. But the large-scale and still expanding militarisation and securitisation of US policy makes the development of such truly free-market mechanisms that much more difficult to realise, precisely because the strengthening of capacities of militaries and security/intelligence sectors invariably strengthens the power of elites and states vis-a-vis ordinary citizens, exacerbates economic conflicts and inequalities, and strengthens the position of those groups that are violently reacting to this process.

The poverty which continues to envelop much of the continent is the result of far more  than just the meddling of the United States.  But the U.S. footprint is present in both actions taken and assistance NOT rendered; if these constitute s***hole countries, perhaps they are perceived this way because we in the U.S. have chosen to see them and respond to them in that way.  After all, no less than the U.S. President has identified them as such.  (I think the President is unaware of the fact that earliest humans emerged from Africa.  Not Europe.  Not North America.  Not Norway.  But Africa.)

The unfortunate truth for many struggling nations is to be found in the poor-man-crawling story:

A wealthy man was walking on a city street, preoccupied with cell phone and important connections.  His preoccupation resulted in a collision with a somewhat disheveled and homeless man walking in the opposite direction.  The poor man fell down, momentarily stunned by the contact, but immediately reached out to gather up several of his belongings which had been knocked from his hands.  The wealthy man, perturbed at the mishap and the dropping of his own phone, retrieved it brusquely and then observed the poor man on hands and knees, salvaging his few possessions.  As he walked away indignantly, the wealthy man observed, “It’s disgusting to see the way these vagrants crawl our sidewalks.  The police should do something about them, to make the streets safe for respectable folks.”

Where there is hunger and thirst, need and distress, poverty and injustice, there are reasons for it.  And sometimes the reasons lie at the feet of those who are not thus afflicted.  S***hole countries, if they actually exist, may well be the result of outsiders who have created them….

The construction of a just peace in Colombia

The construction of a just peace in Colombia

René Mendoza Vidaurre[1]

Colombians, weapons have given you independence, but only the law will give you freedom.

Francisco de Paula Santander (1792-1840), Colombian leader

The law of the jungle should not be the law that our children follow

Seanna Wolf, ex Irish prisioner.

The weak can never forgive. Forgiveness is an attribute of the strong

M. Gandhi

Colombia is the country with the highest level of inequality, the oldest democracy and the longest armed conflict in Latin America. It is a country that now has the opportunity for peace, strengthen its democracy and reduce its inequality, particularly the agrarian inequality. Will it be able to take advantage of this opportunity? Far from showing majority support, and improving laws so that they be given freedom, as Santander would suggest, the peace process appears to polarize society even more, making the “law of the jungle” bleed their social leaders, and contrary to the words of Gandhi, making forgiveness a sign of weakness. How can changes be generated that would lead toward peace with justice and shared prosperity? That question concerns us in this article.[2]

1.     Introduction

The signing of the Peace Accords in November 2016 marked a before and after in Colombia. Society is involved in a broad debate. The most repeated words are: peace accords, reincorporation, reinsertion, demobilization, ex-combatants, reconciliation, normalization, forgiveness, illicit crop, territory, guerrilla, comrade, partner…They are disputed words: “worthy reincorporation into the legal system” versus “reincorporation of the communities against the system of injustice”; “normalization” versus “Who is normal?”; “peace accords of the government and the FARC” versus “rural communities do not know these accords and the governors of the regions are opposed to these accords” and “we already disarmed them, now let´s do what is in our interests, let´s ensure that they do not return to dissidence”; “Colombian democracy is the oldest democracy in Latin America” versus “it is a mafia-like, oligarchial and corrupt democracy”. They explain the meanings: “partner, in the war we would hunt some animal and the family would give us rice, or we protected them and they gave us food, that is why we would call them partner”; “demobilized from weapons, but mobilized by the ideals of justice and democracy”. And solutions for attracting excombatants abound: solidarity economics, inclusive business, cooperativism, corporations, Jesus Christ Savior, production projects…

After 52 years of war between the Revolutionary Armed Forces of Colombia (FARC) and the government, and even in the process of negotiation with the National Liberation Army (ELN), society seems more polarized about the peace process. The October 2016 plebiscite revealed this reality: half of the country said it should be ratified, the other half said no. What explains this polarization that is capable of undermining the peace process? There are at least two attitudes (see Figure 1), one that is cultivated by a society at war, manipulated by elites and resting on a brutal, even though resisted, inequality[3]; and the other that sees the peace process as the opportunity to economically, socially, and politically democratize the country.

Inequality is the key element for explaining the realities of Colombia, be those the armed conflicts or the successes that the peace accords might have. Consequently, following the words of Stiglitz in Bogotá in February 2017[4], “there can be no sustainable economic prosperity unless that prosperity is shared”. How can changes be generated that in the long term might lead toward a peace with justice and shared prosperity?

In this article we reflect on this question taking inspiration from some experiences in Central America, having shared with different actors in the framework of international events in Bogotá, and listened to friends in Colombian academia who are working so that this peace opportunity might help democratize the country. Our motivation is the conviction that if the most unequal country in Latin America deepens its democracy, all of Latin America will feel those winds of inclusion and democratic aspiration.

2.     Perspectives on peace and democracy

Here I identify two models of interpretation of the conflicts and democracy. The first model is “top down”, from war to peace and from authoritarianism to democracy; or polyarchy, a system for containing the pressure of the masses for social change, where decisions and mass participation are reduced to choosing leaders in elections controlled by elites (Robinson, 1996, 2002, 2014[5]). In this perspective the conception is that the armed struggle is an obstacle for democracy, that democracy generates a society without conflicts, that society resolves its contradictions competing for votes, and is modernized based on free trade competing efficiently. Correspondingly, judicial and electoral reforms are done so that laws guide the masses, and the (neoliberal) economic model is fine-tuned, understanding that peace is established on the basis of development; and development means economic growth and the extraction of natural resources to the benefit of an elite (traditional extractivism), or neoextractivism that, as Escobar observed (2012)[6], is also to improve social infrastructure (education and health) and reduce poverty – in other words, the extractivist model is invariable- what varies is whether it is only for an elite or for more,[7] and whether the State plays an active role (iun the neo-extractivism).

The second model is the “bottom up” one, where the idea is that armed conflicts were, and now the social movements are, the basic conditions for resolving historical contradictions and promoting a sustainable democracy (Robinson, 1996, 2002, 2014). Correspondingly, the participation of the population is promoted with their respective life paths, that peace is established with alternatives to development where economic growth and markets, as Gudymas and Acosta argue (2011[8]), are subordinated to the model of wellbeing understood holistically, with social, economic and environmental sustainability. In this framework, peace is achieved to the extent that inequality cedes and the (neoliberal) economic model changes to one of collective well being.

Figure 1 and the words within which the entire country moves can be reread in the light of these two models. From the first model the peace accords express the victory of democracy over the armed struggle, which is why those who are demobilized should submit to the law, ask forgiveness for their fighting and integrate themselves into the neoliberal economy and formal democracy, while the government provides material and legal benefits to the disarmed groups and ensures order. From the second model the idea is that the armed struggle opened an opportunity for democracy to deepen, disrupting State institutions and markets within a perspective not of intensifying development, but of providing space for development alternatives, because it is precisely the reigning development model that produces the inequality and armed conflicts.[9]

Making these perspectives explicit can be reflected in the role of the State, the FARC, social movements, academia, the churches, cooperatives and international aid agencies. Let us give two examples. The first example, academia, following the example of model 1, it is seen armed with categories and methodologies that have sustained the model of development that has generated the inequality and that is opposed to peace; or, following model 2, it can be seen proposing new categories and methodologies coherent with the development alternatives model. The second example, international aid, following model 1, believes it knows the realities of the rural communities and it knows the solutions, which is why it aligned up project writers to hunt for profitable “production projects”, or that at least in the short term would keep ex-combatants from taking up arms again; or, following model 2, democratizes their decisions and opens itself up to understanding the multiple realities of the peasant, indigenous, and afro-descendent communities, and takes the risk of listening to and responding to solutions that maybe do not fit in the neoliberal economic model in which it tended to locate itself. Being part of the solutions and contributing to peace begins disrupting our own attitudes and comforts, that maybe are as authoritarian and centralizing as those of any institution or organization that we are happy to criticize.

3.     What is concealed and what is sought to change

Having this broad perspective, we notice that the armed conflict with the FARC began with two key concepts, the agrarian reality and democracy. The Historical Commission on the Conflict and its Victims (2014) published 12 essays of authors who studied the causes and effects of the conflict in Colombia[10]. Even with different perspectives, all of them agree on the fact that the agrarian issue and the fragile liberal democracy were determining causes, which is why in their recommendations they highlight the fact that changes should happen in land use and access, and that work be done on an economic model where equity would prevail. If Colombia is the most unequal country in its income (CEPAL, 2017), the inequality is worse in the agrarian reality: the gini coefficient for income, where 1 is equal to complete inequality and 0 is equal to complete equality, was 0.530 and the gini coefficient in rural property was 0.897 in 2015; while that coefficient for income improved, because it dropped from 0.564 in 2009, the coefficient for property went up from 0.885 in 2009.

The agrarian question refers to landownership, its use, technology and markets. The key in that is access to ownership of the land. The graph and table 1 show that in the same period of the armed conflict inequality for access to property in Colombia has gotten worse: the Gini Coefficient from 1960 to 2014 went from 0.868 to 0.897.[11] In the same period 0.5% of total owners with more than 500 Hectares of land went from having 29.2% of total land to having 68.2%; while around 88% of total owmers with less than 20 hectares went from having 17.3% to only having 8% of total land[12].

Table 1. Comparison of number of APUs and land used by range of size
1960 2014
APUs AREA APUs AREA
<5 66.7 5.4 70.5 2.7
5 to 20 20.4 11.9 18 5.3
20 to 50 6.7 12.4 6.2 5.8
50 to 200 4.7 24.2 4 11
200 to 500 1 16.9 0.8 6.9
>500 0.4 29.2 0.5 68.2
100 100 100 100
Source: IGAC (2012) Atlas of rural property distribution in Colombia; 2014 Agricultural Census

The cause that generated the armed conflict intensified. This is even worse if we take note of the increasing use of mono-cropping and extraction of natural resources, as well as the financial barriers (e.g. credit in accordance with “capacity to pay”) and commercial barriers (free trade treaties) that affected around 80% of the property owners of the country. The impact of that reality on the country is alarming; socially, Colombia is the country with the largest number of internally displaced people in the world, and “violation of human rights has become a habitual practice” (Oxfam Internacional, 2017)[13]; politically, it is fragile democracy because of its liberal institutions where the connection between arms and politics prevails (Gutiérrez, 2014)[14]. Peasant, indigenous and Afro-descendent communities have suffered the dispossession of their means of life and culture, creating uprootedness and extreme poverty, which has contributed to the armed conflict. Behind that inequality and its impact are hundreds of years of distrust between peasant, indigenous and Afro-descendent families and the families of that group of less than 1% backed by the State and the ideas of “development”; this reminds us of the historian Wolf, who says that the French peasantry at the end of the XVII century had included a phrase at the end of the Our Father that they would pray every night before going to bed: “ and from justice, free us Lord” – that “justice” (State) that dispossessed them from their land and territories,[15] and which the agrarian scholar Machado (2009:54[16], confirms: “the facts show that State action continues breaking up medium size rural property, while large traditional property is not transformed, and small ownership gets even poorer; in other words, the State and society are supporting a bimodal rural structure in ownership as well as in their forms of controversial and not very efficient exploitation, that does not help promote economic growth; in addition, it is a structure that destroys natural resources, undervalues the rural reality and creates conflict between rural society and national society.”

At the same time, that agrarian reality should be qualified. In 1940 the urban population was 30% and in 2012 it was 74%, which is why obviously the weight of the agrarian reality and the notion of what is rural has changed drastically. We do not know the reliability of the Censuses for making distinctions about those changes; but given the large extensions of land that the war included, and the typical problems of legality and forms of land acquisition that our countries of Latin America have tended to suffer, it could be that the table on land ownership would vary, that that bimodal structure might be less and that therefore that structure might express more potential than it now expresses.

The peace accords happened within that context of the incease in inequality and the awakening in society that another economics subordinated to life and democracy is possible. In spite of the fact that after a year there may have been no land distribution yet, while the political opposition defending that 0.5% of large property owners is growing, the peace accords do provide an opportunity for the country to democratize. The question is: will it? Following the mentality of model 1, the problem and its solutions are understood as something technical-administrative, like a “lack of”, precisely to conceal that inequality produced by the fragile formal democracy and the conventional economic model – and to that we would add a perspective closed to the bimodal structure that only sees land and crops. Following the mentality of model 2, the problem and the solutions are understood within the framework of power relationships, change in the power structure (questioning land ownership) and in the people through a different model of improvement – and with that we would add an agrarian perspective that includes land, crops, crafts and recreation of identity). Consistent with the historical perspective and the data presented, we understand that the inequality is above all a problem of the assymmetry in the power relationships, not a technical or administrative problem.

4.     Danger of using peace to heighten the inequality

The bigger risk is that in the name of peace that oligarchic belief is imposed that peace needs more development: economic growth with (neo)extractivism of the natural resources and mono-cropping. It is like saying, the regions of the country are impoverished because of lack of “development”, when it could be the opposite, they are impoverished because of too much “development”.

It is probable that this 0.5% of owners, maybe connected to the finance industry, agroindustry, commerce and the communications media, might see the peace accords as the opportunity to increase their wealth, in addition to legalizing the land that perhaps they obtained through illegal means. That is, far from ceding an inch of land and understanding its importance for peace, they see it as an opportunity for the expansion of the agricultural frontier (in addition to being able to use 70% of the arable land which is unused), new areas free for extraction and mono-cropping, repurchase of land that eventually the State might give out, cheap labor and members of private security bodies among the disarmed, zones free from the FARC in order to control them with armed criminal groups[17] and drug trafficking networks that respond to the demand of the US market, expansion of the financial and agro-chemical industries, “controlable” cooperatives that collect their harvested products and intermediate inputs to them…To take advantage of these opportunities they make use of trade rules, commercial treaties, usury, credit rules[18] and the rules of making policy; and they see the opening of roads, schools and health centers as support.

In a parallel fashion, the avalanche of more-of-the-same solutions makes the disarmed and the rural communities – peasants, indigenous and Afrodescendents –confused. “Inclusive businesses” where the anchor are private enterprises under the principles of “more volume, more profits” and “economies of scale”; cooperatives that discipline their members in mono-cropping, aid organizations responding with projects to “the lack of” technology, knowledge, capital and markets; bilateral aid agencies that with one hand support their own extractive companies and with the other finance actions that would mitigate the effects of climate change; religions (Catholic and Protestant) that win over individuals who would recognize their sins and find forgiveness and glory in the beyond. It is institutionalized technocratic conceit: elites believe they know the realities of the communities, they believe they have the solutions (money, knowledge and decisions) and they believe that change comes from above, while they are moved by a mentality of seeing the agrarian reality as in the past, only land, crops, technology and markets; the worst that can happen is to see the disarmed as agricultural producers and that agriculture is a matter of having land, equipment, inputs and buyers for what is produced.

These solutions also express centenarian and even millennial hierarchical structures. The mono-cropping structure is sustained by a transnational hierarchical structure – be they enterprises, aid industry, Churches, States or academia. The guerrillas also come from a hierarchical Leninist structure of “democratic centralism”. What is common among them is the centralization of decisions in an elite based on informal rules located in the mentality of model 1, not on rules like the Constitution of a country, that statutes of an organization, the agreements of assemblies or the rules of Afro-descendent communities. What is also common in them is the belief that there is nothing good in those “from far below”, and that is why the technician, priest and politician work on persuading. This institutionality, in good measure, tends to be reciprocated by those who are “from far below”, who have internalized that without the boss, commandante or patron, life has no direction; in addition, it becomes a social code: an ex-combatant that shows up to work on a mono-cropping hacienda is familiar with their “order-obey” structure; it seems normal to an activist of a social movement, turned into the director of an aid agency, to have the power to approve projects.

How can this danger be confronted where some good local institutions and communities with strong social and economic networks are being battered? “Everyone for themselves” is a common reaction, ex-combatants and ex chiefs who will seek their own paths in different areas and spaces; others will insist on the promised tangibles goods; many will organize to depend on external resources; in this dynamic, those who persist in their struggle for equality and justice, beyond individual benefits, will be described as terrorists, considered rebels[19] and candidates to be excluded from external benefits and to be part of those leaders physically assassinated[20] and then “assassinated by neoliberalism”. “Everyone help one another” would be more strategic; that is committed to the viability of family agriculture (small scale production or peasant economy) and crafts that would generate autonomy and energize the communal level; a peasant family that diversifies in agricultural and non agricultural activities, uses markets to scale up their income and ensure their food. Within this framework, if that family organizes in a cooperative to resolve collective problems and negotiate resources that inject energy into their production systems and endogenous institutions, they will be contributing to mobilizing their communities and with that, the resurgence of a more just and peaceful society. This does not deny the existence of monocropping and large transnational enterprise, but restrains it, makes visible what is at play in society and shows that it is not a matter of “persuading” and of responding to “the lack of”, but of creating the appropriate conditions in which changes happen in the mentality of society and its institutions

5.     Imperative to focus the direction and the prospects for building an arduous peace

This step requires that the different actors (State, academia, aid organizations, Churches, popular organizations, unions, FARC) rethink their actions. Not only should they support mono-cropping and “the lack of”, but above all families in their agricultural and non agricultural activities, forms of organization and logic in territories of indigenous and Afro-descendent communities, and communities that as Arjona (2016) shows have diverse social institutions, which would have to be understood before prescribing “development” for them. Here we deal with the how.

Figure 2 illustrates the form of relationship between the aid organizations and the communities –populations, disarmed groups, small scale producers or family economy (agriculture, home made products, non agricultural activities). There we see that there is a certain amount of dispersion between the organizations and institutions and they have different discourses with the different rural communities – peasant, indigenous and Afro-descendent. But they coincide in relating to the communities through the “intermediate stratum of development”, who are the technicians, promoters, religious and aid workers. This “stratum” connects two worlds, that of the aid agencies and institutions, and that of the communities[21]; even though in practice the “intermediate stratum” might be more a prolongation of world 1, it tends to turn into world 3, interpreting world 1 and 2 from its perspective. For example, the State through the Reincorporation and Normalization Agency (RNA), has hundreds of technicians going to the communities, as do the aid agencies, churches or the FARC through their structures and technicians responsible for writing projects, encouraging and facilitating organizational processes. We predict that the peace process will be consolidated in its version of responding to “the lack of” with goods and services coherent with the perspectives of model 1, or its version of responding to the democratization of the country coherent with the perspective of model 2, or combining both versions, to a large extent depending on the work of this “intermediate stratum.”

What is common in this “intermediate stratum” molded by world 1? It tends to avoid the fact that the root of the problem is the inequality, underlying a mentality of the rural reality as equivalent to agricultural area and families in need of equipment and infrastructure, and assumes as a mandate the clamor of the aid agencies (“we want production projects”) and that of the government (“we are going to finance viable projects in market economies”). They assume that the work is persuading – be that about tangible goods like replacing illicit crops, the gospel, rules of associativity, productivity, commerce, democracy or gender equity. Each one has their reference in something external to the community: the religious, in the Bible; lawyers, in the laws of the country; agronomists, in the manuals for monocrops, the promoters of cooperativism, in the Statutes…All of them march to evangelize the communities in order to hear what they want to hear, and then returning to their offices they can also make the aid organizations hear what they want them to hear: number of technicians trained, people empowered, projects approved, people benefitted, cooperatives…

John P. Lederach, a Peace Accord advisor, said: “peace is achieved when each Colombian has respect for differences and establishes constructive relationships with the other, with that other that it has not wanted to, or not been able to listen to, for more than a half century[22].” Specifically the challenge is that this group from the “intermediate stratum of development” would overcome their logic of persuading and be capable of listening and observing, processing what is heard and observed, and learning from their conversations under the principle that “light comes from striking stones” – that light can be an idea about a project, awakening to alienating processes and their profound traumas, or paths for collective action. And that then, that “intermediate stratum of alternative development models” can talk with the organizations of world 1 and contribute to their change.

Let´s illustrate this perspective with the formation of a cooperative. According to the logic of persuading, a cooperative is organized with 40 hours of training in cooperativism, they name their manager, and it is provided resources and markets for their products; as a result, the criteria of success is forming hundreds of cooperatives without considering that this type of cooperatives fail quickly or end up being run as private enterprises in “cooperative” clothing[23]. With a logic of learning, the cooperative is organized when its members wake up in the face of an adversity,[24] and because they realize that there are obstacles that they cannot solve on their own, discover the value of their own resources, and that there is another way of organizing outside of the hierarchical structures of mono-cropping and the boss-followers – or as José M. Navarro would say, a member of the La Fábrica cooperative in Barcelona, “a cooperative enterprise opposed to capitalism”. Along this path the member families, studying their realities and experimenting with changes, discover their capacity to innovate, their citizenship (rotating leaders, complying with their rules and agreements, supervising that compliance), administering and investing their collective resources and strengthening their connections with the rest of the community, and recreating new identities within the framework of new realities that look beyond the agrarian reality seen as equivalent to crops. Table 2 shows some elements of this type of cooperative that responds to its members, and that it is possible to produce within a framework of mutual learning and in alliance with the three worlds in accordance with each specific context, and thanks to the creative and catalyzing role of the “intermediate stratum”.

 

Table 2. Keys for successful cooperatives
·       Interaction between the associative side (organs) and the business side (administrative-technical)
·       Effective functioning of the holy cooperative trinity: oversight board, administrative council and assembly
·       Organization around differentiated products (e.g. specialty coffees, organic products) because it requires coordination among several families, geographic concentration
·       Distribution of earnings and definition of goals in the assembly
·       Based above all on their own resources and on endogenous institutions (of aid)
·       Accounting system that generates updated information to be used by the administration and the cooperative´s organs
·       Organizing 1st tier cooperativen on the basis of their members, and organizing 2nd and 3rd tier on the basis of the 1st tier cooperatives, and not the reverse.

This way of working, illustrated with the formation of a cooperative, requires accompaniment with a mentality of going to learn from the communities, from the disarmed groups. Said figuratively, the families in the communities know 50% of their problems, risks and opportunities, and their accompaniers (the restructured “intermediate stratum”) know the other 50%. The innovations emerge from among both sides (“from the striking of the stones”). Correspondingly, this group of accompaniers needs to unlearn in order to learn, increase their capacity to observe and dialogue so that together with the families they detect innovative practices and rules. In this way technicians and promoters will get ideas that they can turn into projects, experiments or initiatives; religious discern that God is in the people who seek justice and organize; administrators learn that the accounting information is not a tool for domination but formation (“informing is forming”)…The best guide that this type of work is on the right path is that both, the families and the accompaniers, awaken to the extent that they are learning.

For this purpose it is fundamental that all the actors from the different worlds rethink their role[25], in particular academia and international aid agencies. Academia, in order to contribute to the formation of that “intermediate stratum”, should produce appropriate categories coherent with model 1 as well as model 2. For that purpose it should organize basic research (e.g. sector analysis of agro and non agro) along with specific research combined with experimentation in specific territories, whose results would be the basis for organizing training. This, nevertheless, requires that academia understand that the source of knowledge is not just imported theories, but different communities with their multiple realities, all of them in need of being conceptualized within a framework of alliance and not just applying theories; and that requires that they include in their gamut of methodologies the organization of thoughtful immersion processes on the part of professors and students in those very territories[26]. The best critiques and policies of conventional theories, and rereadings of the land ownership table, will come from seeing the realities from the multiple perspectives of the countryside.

This strategic change from the “intermediate stratum” and the work of decolonialized academia, requires an active and renewed role of international aid. For this role, international aid should review their own practices in the last 3 decades, practices questioned in the entire world (see for example, Anderson et al, 2012)[27] because their aid has generally helped the type of “development” that has contributed to the inequality and have “ngo-ized” organizations (unions, cooperative and associative organizations) and social movements, dispossessing the families of their own organizations. This revision implies that the aid organizations in Colombia quit waiting for “production projects” from the “intermediate stratum of development”, and influencing the type of projects and centralizing decisions about those projects. This implies that they contribute to creating institutional environments in the territories where the different actors of each territory and the “restructured intermediate stratum” study those realities and produce ideas that really matter to them, and that the decisions about the projects that emerge be decentralized. It implies that the international aid agencies be conceived as allies of the peasant, indigenous and Afro-descendent communities, in favor of democracy and the reduction of inequality in those very territories – allying is like falling in love, and this requires that the “boyfriend” or “girlfriend” (aid agency) moves to the territories where their partner is.

If the communities feel that they have allies in academia and in aid agencies, who join their voices to those of the communities so that their leaders do not continue to be murdered and that they value the fact that they organize on the basis of their own good – and correcting the bad – institutions, then the peasant, indigenous and Afro-descendent communities with different degrees of connections with the FARC and other actors, will take their steps for improvement, will mobilize, will make their decisions more democratically and will understand that the reduction of inequality from the territory itself – with geographic variations – is possible, necessary and just.

6.     Conclusions

The agrarian and (neo) extractivism realities continue to weigh economically, socially and politically on the country, which is why peace should be built on the basis of reducing inequality. The greatest obstacle to the peace process is the institutionality that sustains that inequality. This institutionality has to do with elite economic groups that want to consolidate the peace process with the same mechanisms that caused the armed conflict, and with an agrarian mentality from when the rural population were the majority in Colombia. These mechanisms are expressed in the extractivist and mono-cropping neoliberal economic model moved by the law of the jungle, even though clothed in democracy, a model that has been called “development” or “motors of the economy”. The paradox is that an attempt is made to consolidate peace with the same measures that led to the armed conflict.

This “development” model is clear, seen as the economic model of the elites; but it is not so clear to us that the actors who declared themselves in favor of peace had a functional modus operandi for this model. Because it would seem that there is not much difference between centralizing the decisions of approving “profitable productive projects” and the decisions of the political and economic elites concentrating land, between academia that believes it has solutions in imported theories and the aid organizations that believe they know the future of the peasantry without studying it, or businesses that think that the market knows more than any human being, between the hierarchically organized FARC and the Church and families also organized hierarchically…This shakes up our minds and wakes us up!

If waking up matters a lot, we identify the most important point of change is the “intermediate stratum of development” (administrators, technicians, aid workers, religious) who have served to convince the world of indigenous, peasant and Afro-descendent communities about the world of “development”. We suggest investing in retraining this “intermediate stratum”: that they move from a logic of “persuading” and writing projects for “the lack of”, toward a logic of “learning” and identifying along with the communities ideas in accordance with the different routes and rural institutions in which they move; from prescribing to knowing how to negotiate in the midst of uncertainty. To do so, we argue, the work of the university research centers and international aid agencies is needed; the former with alternative categories to the “development” model, and the latter constituting itself as serious allies of the different communities, recognizing that they are sources of knowledge and seeds for a more democratic and just society.

The peace process in Colombia is a global challenge that generates optimism. In Japanese culture we find two meanings for the word “optimism”: rakutenteki, the feeling of the future that a young person has about their adult life, and rakkanteki, when people accept their problems as challenges to be faced[28]. This optimism (rakkanteki) encourages us to review our own mentality and to recognize that peasant, indigenous and Afro-descendent resistance is also our resistance to inequality and the mechanisms that sustain it. Peace is possible, in spite of “development”, under the spirit of Santander, and as the “effect of justice” (Isaiah, 32:17).

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

[2] I am grateful to the comments of A. Bendaña, E. Baumeister and J. Bastiaensen for their commentaries on a previous version. The text is a draft to be improved and commented on by each person who reads it.

[3] CEPAL, 2017, Social Panorama of America Latina 2016, Table I.A1.2, shows the gini coeficiente for income for 14 countries in Latin America. In 2008 or 2009 Colombia is the country with the greatest inequality (0.564) and for 2015, even though it improved, continues being the most unequal country in Latin America (0.530). See: http://repositorio.cepal.org/bitstream/handle/11362/41598/4/S1700567_es.pdf

[4] Stiglitz, J., 2017, “Challenges    and       Opportunities      for         Colombia’s        Social    Justice   and Economy”, power point presentation, see: https://www8.gsb.columbia.edu/faculty/jstiglitz/sites/jstiglitz/files/Challenges%20and%20Opportunities%20for%20Colombia%27s%20Social%20Justice%20and%20Economy.pdf I am grateful to A. Grigsby for suggesting this text.

[5] Robinson, W., 1996, “Promoting Polyarchy: Globalization, U.S.,” in: Intervention and Hegemony. Robinson, W., 2002. Remapping development in light of globalization: From a territorial to a social cartography, in: Third World Quaterly, No. 23.6. Robinson, W., 2014, “Democracy or polyarchy?” in: NACLA. https://nacla.org/article/democracy-or-polyarchy

[6] Escobar, A., 2012, “Alternatives to development”, in: Transition Culture. Dave Chapman´s interview of Escobar, See: https://www.transitionculture.org/2012/09/28/alternatives-to-development-an-interview-with-arturo-escobar/

[7] It is thought that neoextractivism is generally the case of Bolivia and Ecuador, but more and more used in several Latin American countries.

[8] Gudynas, E. y Acosta, A., 2011, “El buen vivir o la disolución de la idea del progreso” in Rojas, M. (Coord.), La Medición del Progreso y del Bienestar. México: Foro Consultivo Científico y Técnico, in: http://www.gudynas.com/publicaciones/capitulos/GudynasAcostaDisolucionProgresoMx11r.pdf

[9] This duality of “development” / alternatives can also be seen in the duality between contemplation (leisure) and work (business) from the ancient times of Greece up to our times. It has moved from favoring contemplation to giving the highest moral value to work (business), passing though the religious thought of Calvin where leisure (contemplation) became sin and business like the glory of God (see: Rul·lán Buades, G., 1997, Del ocio al neg-ocio… y otra vez al ocio. Papers 53, 171-193. https://ddd.uab.cat/pub/papers/02102862n53/02102862n53p171.pdf). It is a duality that model 2 would seek to connect to one another.

[10] The 12 essays of the Historical Commission of the Conflict are in: https://www.ambitojuridico.com/bancoconocimiento/constitucional-y-derechos-humanos/los-12-ensayos-de-la-comision-historica-del-conflicto-y-sus-victimas

[11] Using indexes like THEIL, instead of Gini, the inequality is even worse. A more detailed study probably can demonstrate the weight of the medium strata, more than a bimodal structure, which would be important in light of more appropriate rural policies.

[12] For a more detailed study of the Agricultural Census in Colombia, see: Oxfam International, 2017, Radiografía de la Desigualdad. https://www.oxfam.org/sites/www.oxfam.org/files/file_attachments/radiografia_de_la_desigualdad.pdf

[13] See Oxfam International in Colombia: https://www.oxfam.org/es/paises/colombia.

[14] Gutiérrez, F., 2014, “¿una historia simple?” en los 12 ensayos de la Comisión Histórica del Conflicto y sus Víctimas. https://www.ambitojuridico.com/BancoMedios/Documentos%20PDF/una-historia-simple-1447167162-1460380556(1).pdf

[15] Wolf, E., 1982, Europe and the People Without History. University of California Press.

[16] Machado, A., 2009, La reforma rural, una deuda social y política. http://www.cid.unal.edu.co/cidnews/archivos/ReformaRural.pdf See also UNDP, 2011, Colombia Rural, razones para la esperanza. Informe Nacional de Desarrollo Humano 2011, http://www.co.undp.org/content/dam/colombia/docs/DesarrolloHumano/undp-co-resumen_ejecutivo_indh2011-2011.pdf

[17] Arjona (2016), contrary to the idea that war zones are chaotic, lawless zone, finds communities with social institutions where the armed structures becomes de facto governments and communities with strong justice institutions capable of negotiating with the armed groups. See: Arjona, A., 2016, Rebelocracy: Social Order in the Colombian Civil War. Cambridge University Press.

[18] The norms for providing credit include “lending money to people with the capacity to pay.” This supposes that those who are not in monocroipping and do not have large areas, are outside of the credit system. This type of mentality was turned upside down in Bangladesh by Yunus and his team, in the 1970s they proved that everyone is capable of paying and that the bank needs to adapt to their realities. If more than 50% of the food comes from peasant families, why doesn´t the financial system respond to that reality?

[19] Hale (2002) observed in Guatemala how international organizations make distinctions of the indigenous organizations between the “permitted” ones, those who drop their agendas to take on the agenda and rules of international aidm and the “rebels”, those that resist and respond to the agenda of their members-communities. The former are given financial support and the latter are not. See: Hale, Ch., 2002, “Does Multiculturalism Menace? Governance, Cultural Rights and the Politics of Identity in Guatemala” in: Journal of Latin American Studies 34.3 Cambridge University Press.

[20] See the newspaper el Tiempo (17-Octubre-2017), “Líderes asesinados, la mayoría en zonas claves para la paz”: http://www.eltiempo.com/politica/proceso-de-paz/asesinato-de-lideres-sociales-fue-en-14-zonas-de-circunscripciones-de-paz-142126

[21] Academia (Universities and research centers) also are part of the block of aid organizations, but their relationship with the communities tends to be sporadic, which is why we have not included them in the figure, while their relationship with the “intermediate stratum” is strong because that “stratum” was trained in the universities and they also organize training courses in solidarity economics and other topics directly for that “stratum”.

[22] Interview of John Paul Lederach, “La paz lo construye cada Colombiano”, El Espectador, June 8 2016. See: https://colombia2020.elespectador.com/pais/la-paz-la-construye-cada-colombiano-john-paul-lederach

[23] Honesty is not lacking in the organizations of world 1 (figure 2): “it does not matter that these cooperatives or projects are not sustainable years later, the important thing is gaining time so that the ex-combatants do not go back to war”.

[24] The adversity is the inequality in land access, the commercial mediation that steals from them in the weighing of their produce, quality control and in prices, or in usury. A savings and loan cooperative that organizes in the face of usury, for example, begins on a good step, because having awareness of the adversity means having recognized (studied) and having realized that bringing their own resources together they can avoid the usury.

[25] For example, for the business actor, the persepective of Kaiser is interesting (2012, La fatal ignorancia La anorexia cultural de la derecha frente al avance ideológico progresista, http://ciudadanoaustral.org/biblioteca/23.-Axel-Kaiser-La-fatal-ignorancia.-La-anorexia-cultural-de-la-derecha-chilena-frente-al-avance-ideolo%23U0301gico-progresista.pdf). He observed that the business class and the right in Chile “do not understand nor believe in the power of ideas and culture as decisive factors of the political, economic and social evolution”, and that they only focus on productivity, technology and financial incentives, forgetting that human beings are moved by beliefs, values and ideas transmitted by the family, schools, books…Kaiser thinks that that bourgeoise and that right fell into a mental anorexia that opened the door to the left. From our perspective, that mental anorexia also is shared by the left and most of the organizations and international aid organizations today.

[26] Mendoza (2015) describes this methodology, precisely based on an experience of a Research and Development Institute in Nicaragua, that for some years was capable of based a good part of their proactive innovation on that methodology of immersion. See: Mendoza, R., 2015, “Inmersión, inserción, escritura y diálogo: Mecanismos de aprendizaje para el desarrollo territorial”, en: Bastiaensen, J., Merlet, P. y Flores, S. (eds), Rutas de desarrollo en territorios humanos. Las dinámicas de la vía láctea en Nicaragua. Managua: UCA Publicaciones. http://www.fao.org/fileadmin/user_upload/AGRO_Noticias/smart_territories/docs/RUTAS%20DE%20DESARROLLO_VERSION%20FINAL_LIGERA.pdf

[27] Anderson et al, 2012, Time to Listen: hearing people on the receiving end of international aid. http://www.elrha.org/wp-content/uploads/2015/07/time-to-listen-book.pdf

[28] This notion of optimism was expressed by Kishida Junnosuke, chief editor of the Asahi Shinbun newspaper, to the question of Peter Schwartz in 1984. See: Schwartz, P., 1991, The Art of the Long View. New York: Doubleday.

The Inherent Lens

Bias.  It’s what we as human being use to see the world around us, whether we like to admit it or not.  We see the world through the lens of our own experiences.  Sometimes that comes from things that have happened to us.  Sometimes it comes from things we’ve been told.  Often our vision comes from the way we would like to see reality, for our own benefit.  But we are born with the predilection toward bias.  Is it also true about the way we view the poor?

I received the following article from the organization, “Progress Through Business,” a non-profit located at the University of Wisconsin-Madison.  It was founded by an acquaintance of mine, John Hoffmire, whom I came to know through his advocacy in the ESOP world.  I found the subject and the data of the article provocative, and decided to include it here:

How The Rich View The Poor

The discussion over rising inequality in the U.S. has captured headlines, been featured in the November election campaign, and incited heated debates analyzing and criticizing the relationships between the rich and the poor. “Out-of-touch” and “unsympathetic” have become buzzwords used to describe the attitude of the haves toward the have-nots.

Despite this narrative unfolding in the media, the question remains whether the headlines reflect reality.

The Associated Press recently cited research saying that 1 in 5 Americans reaches affluence at one point in their lives. This 20 percent block is a far cry from the critique offered by many who want change but still provides evidence of a large disparity between the wealthy and the poor.

Some might ask how this division affects the social aspects of our society. What is the best descriptor of the relationship between those on opposite ends of the economic spectrum? The prevailing story conveyed through the media would suggest that “out-of-touch” and “unsympathetic” do accurately portray the well-off portion of the U.S. society.

However, those who question this viewpoint might pose the following queries: What about the billions of dollars donated every year to poverty-focused charities? What about the wealthy investors who have recently turned their focus to social innovation and impact investing in order to address social ills through business? Doesn’t this demonstrate a stronger interest than we might otherwise think? Or does the philanthropist merely seek notoriety through his or her contributions, and is the socially minded investor motivated by the opportunity to gain new market share or attract new customers?

So the question remains, are the wealthy truly invested in the poor and do they care?

A  New York Times blog by Daniel Goleman detailed research on social interactions between two groups of people on significantly different rungs of the social ladder. I’ll call this research “study one.”

Members of one group had a much higher income than the members of the other. Subjects of both social classes were instructed to share and communicate, with another individual, about hardships that they had experienced in their personal lives. Researchers then observed the interaction between the two individuals. The findings of the research show that the rich consistently demonstrate disinterest in the personal difficulties of the poor.

The wealthy showed less sympathy and concern as they listened to the poor recall personal trials, such as divorces and deaths in the family. Conversely, the poor tended to be as attentive to the difficulties of the rich as they were to the difficulties of their socio-economic equals.

The researchers concluded that we tend to be interested in those whom we value. Partly due to a void in material wealth, the poor tend to value social relationships. They develop “keenly attuned interpersonal attention, in all directions”. This is a trait that anyone — and everyone — could develop, regardless of financial wealth.

If the researchers are correct in their conclusions, and members of our society are only interested in those whom they value, then inattention would demonstrate that the rich undervalue the poor. Why is this? It may be that the rich judge the poor. The rich may assume the poor live a “substandard” life brought upon themselves through their own ignorant or incompetent decisions.

Wealthier members of society may assume that everyone has the same opportunities and that those whose cognitive abilities are less efficient should not receive certain advantages in society because they have not earned them. This attitude, if it exists, is undermined by research that says that many cognitive difficulties are environmentally induced. In other words, those who live in economic stress may be impaired cognitively as a result of the stress caused by consistently living in situations where their economic lives provide bitter choices.

The research, which I will label “study two,” includes an experiment performed at a New Jersey mall and is detailed in a 2013 article written by Anandi Mani, Sendhil Mullainathan, Eldar Shafir and Jiaying Zhao, all prominent university researchers. The subjects of the study were confronted with a scenario. They were told that they faced a common financial problem, such as paying for a car repair.

This problem was meant to activate real financial concerns that existed in the participants’ own lives. After thinking about how to come up with the money to make the payment, the subjects were asked to answer common IQ test questions. This research included a component that tested the respondents’ ability to answer questions correctly and quickly while under pressure. After providing a solution to paying for the auto repair, the subjects were asked to disclose their income.

The subjects were assigned either “hard” or “easy” financial situations, with an auto repair cost of $1,500 or $150 respectively.

When contemplating “easy” situations of $150 auto repairs, the poor and the rich answered the IQ test questions correctly at a very similar rate. When the auto repair cost was raised to a “hard” situation of $1,500, the rich performed about the same on the IQ test as they had during the “easy” situation. However, when faced with “hard” situations, the poor experienced a significant drop in the number of questions they answered correctly. This was in line with the researchers’ original hypothesis.

The experiment was then adjusted to include a financial reward of 25 cents for every correct response. Although the poor have a presumably greater need for the money, they still performed worse during “hard” situations than the rich, and earned roughly 18 percent less.

This seems relatively reflective of reality. The researchers go on to explain that the poor earn less not out of incompetency, but because they must allocate mental capacity to problems that are more pressing to them than to the rich.

Remember that the poor performed just as well as the rich when the stakes were low. The difficulty for the poor arose when the payment increased to $1,500, even when they had the ability to make money by answering correctly. Many expenses, which the rich consider minor, become major obstacles for the poor, requiring a significant amount of attention to address. This allocation of attention to pressing concerns may in turn prevent the poor from taking advantage of opportunities (such as earning extra cash in the above study).

Additionally, solving these problems comes at the expense of other basic needs. The researchers cite prior studies showing that the poor “use less preventative health care, fail to adhere to drug regimens, are tardier and less likely to keep appointments, are less productive workers, less attentive parents and worse managers of their finances.” According to the study, these troubling behaviors are caused neither by laziness nor incompetence but by decreased capacity brought on by the situations the poor face. This is due to the overwhelming nature of stressful situations, many of which are not nearly as difficult for the rich.

The study’s results provide key insights into the relationship between the rich and the poor. The occurrence of the types of problems discovered in study two should not elicit negative judgments from the rich but rather understanding. The wealthy could be much more interested in the poor, knowing that the personal difficulties in the lives of the poor may have more serious repercussions than situations in their own lives. The resources of the poor, financial and mental, are often already stretched to their limits.

If studies one and two are reflective of the reality of how the rich view poverty-stricken people, and I believe they are, it is a major misperception on the part of the rich to believe that the poor should always be able to recover from setbacks in the same ways as others. And if both of the above studies are true, then less-advantaged individuals’ traits of “keenly attuned interpersonal attention in all directions” are all the more impressive. Low-income individuals are able to allocate their attention to focus on other people, while the rich do not seem to have this same ability, often depriving the poor of sympathy and understanding.

The studies give us observations and a neurobehaviorialistic view of the relationships between rich and poor. But what else might motivate the lack of demonstrated concern of the wealthy for those less fortunate? Perhaps it is that the rich are so focused on gaining more wealth, status, and contact with other wealthy people that there is little incentive for them to get to know and care for the poor.

So the question arises, how can the rich turn their attention outward and toward those on the opposite end of the social ladder? One way would be for everyone to better understand the role of good fortune and the assistance they have received from others. Many have benefited from those who stand a few rungs up and a few rungs down.

We, of all social classes, could consistently be looking out for those who find upward mobility difficult and we could understand that trials and burdens are taxing, painful and often devastating for those at many points along the socio-economic spectrum, but are especially paralyzing for those at the bottom of the wealth pyramid. While those who are well off enjoy the comfort of ample financial resources, they could also strive to develop and use their own sense of a “keenly attuned interpersonal attention, in all directions.”

I say this not only on account of the poor. It seems that many in other social classes are missing out on a special opportunity. I notice at times in our society that many people lack a sense of purpose. Dedication to the poor and a willingness to act on their behalf can bring great value to the life of someone who is willing to serve.

One who certainly showed attention to those less fortunate was the late Nelson Mandela. Leading a nation out of apartheid also meant fighting a war against poverty. Partly due to his work, South Africa began a process leading toward greater development in Africa. Mandela understood that our social interactions are key tools in combating poverty. He described our duty to do our part to help those around us and across the globe when he said:

“Overcoming poverty is not a task of charity, it is an act of justice. Like slavery and apartheid, poverty is not natural. It is man-made and it can be overcome and eradicated by the actions of human beings. Sometimes it falls on a generation to be great. You can be that great generation. Let your greatness blossom.”

We could all benefit from allocating our own financial and mental resources in an outward way, paying special attention to those around us who are less fortunate than ourselves.

Adam Turville

It’s an interesting study and a sobering one.  I wonder what misconceptions others have about me….?