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Show ONLY MEN CAN CO-OPERATE Much Confusion in Use of Term "Co-Operation" "Co-Operation" as Applied to Agricultural Agri-cultural Efforts. (By G. HAROLD POWELL ) The co-operative organization differs dif-fers fundamentally from the capital stock corporation conducted for profit. A capital stock corporation for profit is organized to return an earning and a profit on the capital used in the business. The basis of administration, control and the distribution of earnings earn-ings is the capital invested in the undertaking. un-dertaking. In a co-operative organization, organi-zation, the basis of control is the membership, where each votes equally equal-ly irrespective of the volume of his business: though the basis of control is often made the product of the members, where each votes in proportion pro-portion to the volume of business contributed, while the earnings In either case, ' if they occur, are returned re-turned to the member in proportion to the volume of business ho transacts trans-acts through the organization. The basis of the co-operative organization is men: of the capital stock ccrpora-tion. ccrpora-tion. money. Capital cannot co operate; oper-ate; products cannot co-operate; only men can co-operate. When the degree of co-operation of a member is measured by the capital or the volume vol-ume of business contributed, then the members as men are not co-operating; either capital or a product is the basis of co-operation through the member mem-ber as the medium. There is much confusion in the use of the term "co-operation" an applied to agricultural efforts. It Is commonly common-ly applied to any group of farmers who associate themselves together. They may organize as members of a voluntary unincorporated association of individuals; or as an incorporated capital stock association to handle farm crops for profit or for other purposes, pur-poses, or as nonprofit corporations without capital stock. In California, for example, the term is applied to both profit and nonprofit corporations organized to handle farm products, whether organized and controlled by the producers themselves, or by others. oth-ers. In other parts of the country, the same uncertain use of the term is applied to various kinds of agricultural agricul-tural movements. The term needs to be defined by the federal and state statutes. It is believed that its use as applied to business organizations : in agriculture should be restricted to incorporated associations, societies, exchanges, or agencies which are formed exclusively for the benefit of the members; whose voting power is based on equality of membership; whose membership is confined exclusively exclu-sively to active producers, the membership mem-bership ceasing to exist when the producer pro-ducer withdraws from the organiza tion, and whose earnings are distributed distrib-uted by each member, after a fair rate of interest is paid for the use of capital actually employed in the business, busi-ness, if any, and other overhead charges are deducted. A co-operative organization, therefore, is not a corporation cor-poration in which the capital 1s contributed con-tributed primarily in order that it may earn a profit: nor one composed of producers and nonproducers; nor one in which the producer's product is handled by a corporation for the benefit bene-fit of the stockholders rather than for that of the members: nor one in which the membership is not under the control of the organization: nor one in which the membership do not actually control the organization. It is an association of farmers who unite in an effort to handle their cornmuc interests through an agency which is controlled by them, on the principle of an industrial democracy, and exclusively ex-clusively for their benefit A co-operative association may be. incorporated as a capital stock cor poration or as a nonprofit corpora tion without capital stock. If formed as a capital stock corporation it may still he legally co operative if the laws under which it is formed permit the members to manage its affairs along co-operative lines, or if the statute provides the method of voting, the method of transferring stock, the limitation of membership and the dis tribution of earnings according to co operative principles. There has been little effort by the states to er act laws that will permit the organization organiza-tion of purely co-operative assoeia tions of farmers. It is therefore ira possible in most states for an asso ciation to be formed that can operate secu'-ely along co-operative principles, though as a matter of fact many associations asso-ciations so formed do. by the conscr.t ot the stockholders, actually operate co operatively. |