Palmer, Alaska
Dorothy M* B.11, Editor
Published on-co a rook at Palmer, Alaska, for tho Matanuska Valley Enttncrs’ Cooperating
Association tor tho purpose of giving nors of the Associations’ TTork, Problems and
Accomplishmonts.
SUBSCRIPTION RATE §1,75 por yoor. $1*00 for six months 10tf a copy
BOOK VALUE-OR, HOW MUCH OO WE LOSE?
During the last for months most of us have hoard considerable coinncnt on the so-callod
Book-Valuo of the different properties of the Co-op, The remark is frequently nado ^
that the Co-op should soil certain pieces of its property for the Book Value, because
it has boon doprociatcd to somo certain figuro that ro are supposed to bcliovo it is
rorth. Unfortunately Co-ops have to use rules of common sense in conducting their
business or they rill soon find themselves out on a limb just like any other business.
Most any rule that rould ordinarily apply to any business must also apply to Co-ops
or it just doosn’t mako sense.
So this idea that our Co-op should sell any part of its property’for any less than any
other business rould under tho somo circumstgneos is just loose foolish thinking and
there is no reason for it cxcopt tho prcdjuccs or ignorance of those rho rould advo
cato any such thinking.
Suppose for instance that someone carao along and tried to buy your farm on this basis,
and you sold it. This is rhat rould happen.
If you bought a farm in 1935 for $5000, and it had a house and bam on it that cost
$4000, at that time, you rould figure tho depreciation at'tho rate usually used by tho
Income Tax Bureau rhich ’-ould be on the basis of 25 years, As you'rould nor have had
tho placo about half of the timo that the dopreciation'rould apply, you rould have to
set the figure a littlo undor $2000, for the buildings. As the land doosn’t ordinari
ly doprcciato much you could still charge tho other $1000 for that and that rould mako
$3000, for yOur return on your $5000 investment.
Why, you say, anyone rould be crazy to do a thing like that, Yot that is just rhat
some of our members and others rould'like to do rith Co-op property, rhen they insist
that it should be sold at book valuo.
Nor there is a possibility that should members of the Co-op disagree on policies or
nanagement and should docido to split it up and lot those rho are interested in some
certain department, purfihaso that department from tho rest of tho members, then this
might make sense as all had contributed to the building of‘that certain parti In this
caso it rould hardly be fair to mako some of them pay for the building trice, but then
again suppose that several of the dissonting group had just recently joined the Co-op,
All they paid ras a $5,00 membership foe, Hor could thcy'cxpoct to get an interest
in this department for their small financial contribution. It must take a lot of gall
to try to get somo department turned over to them in rhich they did not furnish any
products'for its operation of financial assistance oither—such as the Ice Cream de
partment.
Wouldn’t the other members be foolish to let a profitable business get aray from thorn
just bodauso someone rith a great urgo for possession of something that doosn’t belong
to thpm, rants it.
Another thing is that rhen a business is being established, it usually tokos somo time
to get in into profitable operation. Then rhen it docs become valuable, it rould bo
foolish to sell it at tho cost or purchase price, bccauso it had taken such a long
time to get it on the profitable side of operation.
You certainly rouldn’t soli your farm of business for tho lorer price if all the pro
perty around you had increased in value, rould you? Certainly not, so just hor much
senso does it make to say that the Co-op should adopt businoss practices like that
rhen the Co-op is mado up of individuals for rhom it rould be bad. Think-it over,
Carl R. Rasmussen
COOPERATIVES CROW TO MEET .REAL NEEDS
Cooperatives arc as fundamentally American in. spirit, deed and practico as is any in
stitution in the land. They ere diroctly in the tradition of the husking boes and
barn-raisings of early .America, Thoy arc the natural economic'expression of a free
people—a pcoplo unwilling to bon to any earthy lord’or master- ard oq:,.alT_y nary of
placing unnecessary ponor in the hands of government,
TThcre the nood docs not exist, cooperatives rill not gron. But nhcrc the need dees
exist—nhether such need arises as the result of misused poncr or the inadequacy of
individual act ion—cooperatives are the natural tool for men and nomcn rho cherish
both liberty and economic abundance. Cooperative League of the U.S.A.