Question

US HISTORY: what is the system of rural cooperation?

Answer 1

i believe during the time of great awakening

Answer 2

sorry i don't know

Answer 3

Probably the creation of organizations for marketing agricultural produce, to obtain collective leverage in negotations with transportation and manufacturing concerns, which tended to be run more centrally.

Imagine you are a farmer with 200 acres of corn in. When it comes time to sell it, your leverage on price with the local grain elevator -- owned, say, by the railroad that serves it -- is low. The elevator can easily not buy your grain, because your neighbors also have grain to sell, and all of you MUST sell it to the local elevator, because you can't transport it 50 miles to the next one. You could easily end up accepting a far lower price than the eventual price of the baked goods made from your grain would justify, with the railroads and elevator (storage site) taking huge profits.

That's a little exaggerated, because the fact of the matter is that the elevator and railroad were also very risky endeavors, requiring fantastic capital investment -- lots of cash up front to build them, and a drought in some region could wipe everything out. Consequently both railroads and elevators tended to need to score fat profits in the good years and good harvest regions to compensate for the awful bad years and bad regions, and to support the payment of the debt on all the money they had to borrow. At the end of the day, owning a railroad turned out NOT to be the way to get rich in the 1880s, except for a very few people.

However, one response of the farmers would be to get together with their neighbors and form their OWN elevator, a "co-op" (meaning co-operative), which the farmers would own and operate jointly. Now they could buy grain at prices they all agreed were fair, and gain extra leverage with the railroad, because now they spoke with one voice. It's something like an industrial workers' union, and indeed rural co-ops were often considered the fore-runners of industrial unionization, although that, too, is a little oversimplified.

There are other kinds of co-ops: you can get co-ops in retail sales, too, where farmers get together to open a feed and farming supply store, which, again because it represents all the farmers, has much greater power when negotiating with upstream suppliers, and which can sell its products to its member farmers at lower prices, in principle.

Ultimately co-ops only really prospered where you had unusually rapacious and stupid competitors. Where that was not the case, the theoretical savings of a co-op dried up, as the co-op actually had to face the same costs and challenges as a non co-op, but without the professionalism and single-mindedness of the firm in no other business. That is, it's a challenge for a group of guys who are experts on farming to become part-time experts on merchandising, transport, et cetera, and if their competitors are not stupid, they usually end up losing. There are, nonetheless, co-ops still extant today in various places and of various types.