Published once a week at Palmer, Alaska, for the Me tonus lea valley
Farmers’ Cooperating association for the purpose of giving news of the
Associations work, problems and accomplishments.
SUBSCRIPTION RATE .j,>1.75 per year vl.00 for six months 10# ea.
COOPERATIVES and PEOPLE
It is not consumers and farmers alone that have benefited through co
operatives. Many other types of commerce and industry have taken ad
vantage of cooperative effort to lower costs or improve services.
In our Capital City of Washington, over 250 independent grocery stores
united in order to advertise and purchase cooperatively. By so doing,
the operators of these stores wore able to meet the competition of
corporate merchandizing successfully and to remain in business.
Thu Federal Reserve Bank and the Associated Press are other well known
examples of cooperative effort.
It was inevitable that as cooperatives grew in number and strength that
thuy would incur the hostility of certain big business enterprises.
Without doubt, cooperatives do regulate prices and quality of goods and
services. They prevent monopolies and thuy narrow the spread between
the price the producer receives and that which is paid by the consumer.
This, of course, cuts into the profits which might otherwise be made by
speculative interests.
Within recent years, there has developed a powerful movement directed
against cooperatives. This movement apparently does not lack adequate
financing for its high powered propaganda campaign, although the power
ful trade interests backing this movement announce other objectives, it
goes • ithout saying that their real purpose is to destroy the competitio'
and the regulatory influence of tin cooperatives.
The charge they make that cooperatives do not pay taxes is false, but
it faakos a popular appeal to some uninformed small businessmen who are *
finding it hard to meet their own competition.
Under the law, a cooperative acts as agent for its members. In making
purchases, the member pays a full competitive price for what ho feuys.
In selling through a cooperative, the farmer receives a payment on his
consignment which is usually just bclow the market range.
If it develops that the money advanced for purchases is more than is
necessary, or the initial payment on commodities consigned for sale is
less than the amount actually received,then the difference is refunded
to the cooperative member. This refund is known as patronage refund.
This amount refunded clearly should be and is exempt from taxes because
the money does not belong to the organization, but to the member-and re
presents either a refund for overpayment on purchases or the final pay
ment for commodities consigned for sale.
The cooperative pays all kinds of taxes that other forms of private
industry pay. If it makes money which is not refunded to its members,
an income tax must be paid on that also.
Any corporation has the same right as cooperatives to refund excess pro
fits to its customers without paying taxes on such refunds. There are
many instances where this is being done.
Thus far, those elements of big business which seek to sabotage the
cooperative movement have had little success.
Farmers, consumers or small businessmen certainly have as much right tr
organize a cooperative for their mutual benefit as any group of men h«’S
to organize a corporation for the purpose of making profits for a f-v',
I would like to point out also the fact that cooperatives arc a bulwark
Cont. ,on page 3 _ _ ___