by Ian MacPherson
History Department, University of Victoria
Manitoba History, Number 13, Spring 1987
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The Canadian co-operative movement in the 1980s is a powerful movement: it controls assets nearing $50,000,000,000; it plays significant roles in agricultural, fishing, and financial industries; it is important in the housing, consumer, and handicraft sectors; and it has over 11,000,000 members in its various organizations across the country. [1] It is a movement, however, which currently finds it difficult to undertake new initiatives, such as worker co-operatives, or to participate in local economic development as it once did. This paper examines the launching of one large co-operative, Canadian Co-operative Implements, during the late 1930s and the 1940s, trying to understand why that experiment succeeded. [2] It argues that the development of C.C.I.L. was possible because of the context within which it took place, including the co-operative networks that had emerged in the Prairie region, and the distinctive qualities of what might be called co-operative entrepreneurship.
Men at work, C.C.I.L. circa 1944
Source: Archives of Manitoba
The high cost of machinery was a standard grievance from the beginnings of rural protest on the Prairies. From the time of the Grange in the 1870s to the Protective Unions of the 1880s to the Patrons of the 1890s, farm groups complained about the high cost of equipment. [3] The complaints became more strident when the steam engine revolutionized grain harvesting in the late nineties and the early years of this century. Those machines, of course, were incongruous: large, ponderous, cantankerous, they lumbered across the Prairie landscape each year, orchestrating the labour of late summer and early autumn. Once harnessed to threshing units, however, they were the essential machine for the grain economy: they alone allowed for the employment of the armies of harvesters; they alone made it possible for farmers to harvest the vast lands during the agonizingly brief periods permitted by Nature each year. It is understandable, therefore, that the first serious sustained efforts by Prairie farmers to lessen the costs of machinery belong to the time when the oddly-shaped steam engines were transforming the wheat economy. It was then that at least some farmers began to realize the need for controlling the supply and the delivery of the machines that made their work possible. [4]
Between 1900 and 1930 even newer machines—tractors and combines—began their surprisingly slow transformation of Prairie agriculture. Gradually, the shape of the modern tractor became more discernible from the awkward, sometimes ludicrous designs of early models. Though still too heavy and underpowered to be of much use except at harvest time, they were nevertheless symbols of prosperity, indicators of “forward-looking” farmers. Occasionally, too, in the Prairie countryside, one could see another important innovation, the combine, the machine that would ultimately replace the steam tractors and their attendant harvesters, those wandering men so vital to the wheat economy’s early history. But by the end of the twenties, they were, like tractors, more promise than reality, more future than present.
The constantly changing mechanical requirements of the farmers explains why the cost and servicing of farm equipment became so crucial to western farm groups. In the often bitter struggle for survival that grain farming became, machinery was one of the vital determinants of success. Thus, from the early years of the twentieth century, farm groups were concerned about the costs and supply of farm equipment, and they forced both provincial and federal governments to examine the machinery industry repeatedly. The Grain Growers’ Associations, the first wave of marketing co-operatives developed between 1906 and 1916, and the second wave, the wheat pools of the 1920s, all complained bitterly about the costs of farm equipment. [5] Their spokesmen and their journals—The Grain Growers Guide, The Western Producer, and The Scoop Shovel—consistently protested what they believed was an exploitive machinery marketing system. In response, special governmental committees were established to investigate the farm implement question, and the costs of machinery were explored by the various enquiries into the grain trade between 1900 and 1940. Several farm politicians—C. A. Dunning, W. R. Motherwell, T. A. Crerar, John Bracken, to mention only a few—repeatedly pledged to improve the situation, but as with high interest rates and tariffs, the politicians never supplied adequate relief.
There was another important aspect of “the machinery question,” and that was perfecting the appropriate machines. In many ways, the Prairie farmers had been betrayed by their own heritage. When farmers migrated from Eastern Canada, the United States or Europe, they brought with them the practices of generations. Perhaps most importantly, they imported the mouldboard plow. The theory behind this piece of equipment, perfected in the middle of the nineteenth century, was that the farmer should dig deeply into the soil and invert the sod, thereby bringing nutrients to the top and burying plant fibres. This technique, when abetted by crop rotation, frequent moisture, and regular fertilizing, worked well in the settled agricultural areas of eastern North America and Europe. It worked less well in many parts of the Prairies, and it provided the elements of disaster in the southwestern parts of the region: the soil was exposed, the moisture evaporated, and, when the winds came, the top soil was blown away. The evils of this method became most evident in the 1930s. Somehow, better methods and more appropriate machines had to be found, and, for some Prairie farmers and farm leaders, some of those solutions could perhaps be found through co-ops.
Since the late nineteenth century and through the 1920s Prairie farmers had found at least partial solutions to some of their basic problems through co-operative action. The most dramatic developments had been in co-operative marketing, but farmers had also secured supplies through their marketing and supply co-ops. Across the Prairies there were over three hundred co-operative stores, most of them dominated by farmers, and there were over six hundred buying clubs, some organized legally, most structured informally. In addition, there were countless, locally-owned co-ops to supply electricity, to provide health services, to buy purebred livestock, and to own recreational facilities. [6] Naturally, then, as Prairie farmers struggled to keep pace with changing technology and to find ways to lessen the cost of their machinery, they turned to co-operative techniques. They did so even though the 1930s was not a period when capital for such an expensive proposition as a co-operative farm machinery enterprise could be easily found.
An example of what could be done amid adversity by co-operative action was provided by the formation of Consumers Co-operative Refineries in 1934. It was a response to the absorption of small independent Prairie oil companies by international petroleum organizations and to the related decline in the margins allowed by the majors to petroleum outlets. The decline in the margins particularly affected several petroleum supply co-operatives operated by farmers, especially those located in the Regina-Weyburn-Moose Jaw area. Consequently, a large number of cash-poor farmers raised $32,000 during 1933-34 and their small refinery went on stream in early 1935. [7] Although the refinery went through some difficult years, particularly in the late thirties, its success—and the model it provided—stimulated a widespread reawakening of co-operative enthusiasm, particularly when many farm leaders became increasingly concerned about the farm machinery question in the middle and late thirties.
One of the developments that drew attention to the implement industry and the cost of equipment was the Royal Commission on Price Spreads (the Stevens Commission) appointed by the Canadian Government in 1934. It was particularly critical of the costs paid by farmers for repairs: for example, purchasing parts of machinery individually would total over 170% of the cost of an assembled and delivered machine. [8] Another major factor in reawakening the concerns about machinery among western farmers was the decision by machinery manufacturers in 1936 to raise the cost of implements by 4% even though the tariff on parts and machines from American suppliers had been reduced in the previous year from 25% to 12½%. [9] This increase, coming in the wake of several years in which Depression-impoverished farmers had found it particularly difficult to purchase equipment or to make payments on loans for machinery acquired previously, created considerable anger among farmers and farm groups in Western Canada.
The King government responded to the outburst in a typical way by appointing a committee—in this instance, one emanating from the House of Commons. The committee held hearings during 1936 and 1937, analysed manufacturing and distributing costs for machinery, and listened to several delegations from machinery companies and farm groups. It found that the retail costs of machinery had generally been too high since 1891, that the 1936 price increases were too high, that replacement and repair costs were excessive, that there was competition among companies for sales and service but not for prices, and that the credit costs incurred by farmers to purchase machinery were too high. [10]
The report, however, did not stimulate any direct action from the federal government and, when the tariff on American machinery parts fell by another 7.5% in 1938 without a decrease in the price charged farmers for machinery, [11] Western Canadian dissatisfaction over the machinery issue grew. Consequently, in February, 1939, the Saskatchewan government of W. J. Patterson appointed a Select Special Committee, under the chairmanship of W. G. Ross, to investigate farm implement prices and distribution. For the most part, this committee relied upon the statistical evidence compiled by the previous federal government committee. It relied even more on submissions made by the major farm machinery manufacturing companies, the University of Saskatchewan, the United Farmers of Canada (Saskatchewan Section) and two M.L.A.s, George Williams and O. Demers.
Of all the submissions, however, the most important were submitted by three of the province’s most prominent co-operative leaders: H. L. Fowler, Chairman of the Saskatchewan Co-operative Trading Association, which drew together all of the consumer co-operatives in the province; R. McKay, Manager of the Saskatchewan Co-operative Wholesale Society; James McCaig, President of the Wholesale. These three leaders were assisted in their efforts by B. N. Arnason, the Commissioner of the Co-operation and Markets Branch, Saskatchewan Department of Agriculture. [12] The main presentation advanced by this group was made by Fowler, an energetic, forceful, imaginative and somewhat iconoclastic co-operative leader who had been drawn to the co-operative movement from his position as a bank manager and then a gas station operator at Wilcox. [13] He had speedily become one of the main organizers for the Consumers Co-operative Refineries, where he became secretary. [14] In his submission, Fowler outlined the potential for a co-operative organization that could sell new equipment and service old machinery. [15] To help farmers finance their equipment costs, Fowler recommended extensive use of the province’s rapidly-growing credit union system. Aware of the problems that had beset the co-operative dairy industry in Saskatchewan, [16] Fowler emphasized the need for grassroots support rather than a top-down, government-initiated “co-operative plan.” He did advocate, however, that government become involved by providing expanded education and supervisory services through the Co-operation and Marketing Branch and by making available a small amount of seed capital. McCaig followed Fowler’s presentation and described how American co-operatives were becoming involved in the farm machinery business, [17] and McKay described the work of the Wholesale, suggesting that its method of local ownership might provide a model for the organization of a new farm machinery co-operative. [18]
The committee was most impressed by the submission from the co-operative leaders and, in effect, adopted the programme recommended by Fowler and his associates. [19] In its report, the committee attacked the “gross inefficiency” of the large corporations dominating the implement business and accepted Fowler’s claim that a co-operative institution, if it had sufficient support from farmers, could save them 40% on the current retail cost of implements. It recommended that the government expand its educational and supervisory assistance to organized co-operatives, and that it consider investing a $50,000 revolving fund to help finance purchase of an original inventory. In summation, the committee completely endorsed the co-operative solution and was “definitely of the opinion that the timely and permanent solution of the problem of farm implement prices [was] to be found in co-operative effort.” [20]
Though it only offered a series of recommendations to government, the report of the Select Committee was a challenge to the Prairie, and especially the Saskatchewan, co-operative movement. In particular, it challenged the co-operative leaders who had emerged in the course of the Depression. In all three Prairie provinces, the lessons learned during the “Ten Lost Years” had created a determined and imaginative co-operative programme that embraced all kinds of economic and social activities. It was this group that largely brought the credit union idea to the region; that created the refinery; that ultimately organized a co-operative insurance programme; that restructured the dairy industry; that fostered the development, in the 1940s, of co-operative farms; that created extensive educational networks using fieldmen, journals, networks, radio programmes, and study groups; and that began the development of co-operative manufacturing with the creation of Interprovincial Co-operatives. Ideologically, the networks that emerged within Prairie co-operative circles were diverse, embracing a rich mixture of co-operative utopians (those who believed the entire economy could and ultimately should be organized on a co-operative basis), social democrats, liberals, conservatives and marxists. These differences, while sometimes divisive, also encouraged intense debates and assured that issues were not avoided. Moreover, the differences did not interfere significantly with the capacity of these diverse groups to work together effectively on behalf of specific co-operative initiatives. [21]
The Co-op "Disker", Manitoba Co-operator, June 16, 1947
Source: Archives of Manitoba
On 23 April 1940 thirty-five men gathered in the Bessborough Hotel, Saskatoon, to discuss how a farm implement co-operative could be developed. [22] As a group, it included nearly all the major leaders of the Prairie co-operative movement and many of the most powerful farm leaders as well. Among those present were John H. (Jack) Wesson, Paul Bredt and George Bennett from the wheat pools; the ministers of agriculture from Manitoba and Saskatchewan; L. J. Bright and Harry Fowler from Consumers Co-operative Refineries; J. E. Brownlee (the former premier of Alberta) from the U.F.A. Co-operative; and representatives from the provincial federations of agriculture, the Saskatchewan Dairy Pool, the livestock co-ops, the United Farmers of Canada, the Alfalfa Co-operative Marketing Association, the Blindman Valley Co-op, and the three provincial co-operative wholesales. [23] The fact that so many of the most prominent co-operative leaders on the Prairies attended the meeting suggests the influence of McCaig and Fowler, the organizers of the meeting, and attests to the importance of the implement issue. At the conference, Fowler advanced the idea that there should be a sign-up campaign to attract at least 35,000 farmers, using funds provided by provincial governments and co-operatives. Others in attendance offered a range of other possible solutions. Thus, while the meeting could endorse the need for developing ways to lower implement costs, it inevitably believed that further study of the problem was necessary; a committee was appointed which included Wesson and Bredt from the Saskatchewan and Manitoba pools, McKay, Peterson and W. F. Popple from the Saskatchewan, Alberta and Manitoba Wholesales, and Brownlee from the U.F.A. Co-operative. This committee, which added Harry Fowler (who became chairman) and another five members, hired professors of agricultural engineering to seek out adequate sources of supply for implements, particularly from American manufacturers. [24]
By July 1940, the report was completed and most of the same people who had attended the previous meeting came to a second meeting in Regina in the following July. [25] The report maintained that a supply of adequate and reasonably-priced machinery could be secured from the United States should Canadian manufacturers be unable or unwilling to supply a new implement co-operative. Nevertheless, several of the people present at the meeting were skeptical about the timing and the availability of investment funds among hard-pressed farmers. With some reservations, therefore, the meeting endorsed the plan of launching a campaign to sign up farmers in a region-wide co-operative organized on a district basis. A provisional board was established, consisting of Fowler, Brownlee, Peterson, Popple, Colin Burnell from the Manitoba Pool, Tom Bobier from the Saskatchewan Pool and B. N. Arnason. Subsequently, McCaig was added to this group which then served also as an organizing committee for the new co-operative. The key point about the makeup of this committee was that it possessed diverse, strong associations with the entire range of co-operative activity across the Prairies, and it also had excellent ties with the appropriate departments and chief political figures in their provincial governments.
As plans for the new company unfolded, the importance of co-operative networks and existing structures was also clearly evident. Most of the initial capital for undertaking an educational and sign-up campaign came from provincial governments—$2,500 each from Alberta and Manitoba and $3,000 from Saskatchewan [26]—but most of the personnel and the organizational support came from existing co-operatives. Organizing committees were developed in each province using, for the most part, personnel freed at least in part from their regular duties by the larger established co-operatives. In each province, the district co-operatives were organized as much as possible according to the geographic boundaries of the wheat pools; in Saskatchewan the district co-operatives followed precisely the pool boundaries, in the other two provinces minor adjustments had to be made. [27] Pool fieldmen, particularly in Saskatchewan where the pool had a rigorously enforced policy of promoting all kinds of co-operative activity, were expected to assist the development of the implement co-operative whenever possible. [28] At the same time, most of the main co-operative organizations, through their publications and radio broadcasts and at their regular meetings, publicized the initiative and stimulated debate among their members.
During the winter and spring of 1940-41 several co-operative organizations financed loans of $9,850 to assist with organizational activities. [29] Using these funds and some of the money provided by the provincial governments, campaigns were organized in all three provinces. The campaigns had varied success, but together they raised significant amounts of money. Most of the campaign workers contributed their time. Some were paid on a commission plus expenses basis. [30] Typically, the campaigns began by organizing district co-operatives at meetings that in some instances attracted between 400 and 500 people. [31] In most cases, one of the directors of the Canadian Co-operative Implements Limited—often Harry Fowler—was the featured speaker; pamphlets, such as “The Farm Machinery Plan,” the first pamphlet prepared about the company, were distributed; and the farmers present were asked to join the co-op and to purchase a share for ten dollars. Following the meeting, the campaign was taken to the countryside through various co-operative meetings and direct canvasses by organizers and salesmen. While the district associations were useful in organizing interest, they served regions that were too large to function effectively as “locals” in the same way as did co-operative stores or wheat pool districts. [32] Moreover, though the attendance was usually good, the members present represented only a fraction of the numbers needed. Thus it was the local campaigns following the district meetings that ultimately determined the future of Co-operative Implements.
In each of the first three campaigns on behalf of C.C.I.L.—from the late autumns to springs of 1940-41, 1941-42, and 1942-43—the organizers achieved varying degrees of success. In Manitoba the campaigns soon came to be dominated by J. B. Brown, a native of the Scottish Clydeside who had emigrated to Canada in 1913. He had farmed quite successfully near Cartwright, and had become well known in Manitoba as president of the Co-operative Commonwealth Federation. When Co-op Implements was established in 1940-41, Colin Burnell had been in charge of the initial campaign, but Brown had been the most successful campaigner in signing up members. A powerful orator, with a dynamic personality and a rich Scots brogue, he was a forceful leader, strongly independent, sometimes stubborn, and always earnestly sincere. He later recalled the technique he used. He would arrange to meet with members of local pool committees only after he had signed up the members of the executives of those committees. [33] When he spoke to the members he followed the pattern he used very successfully in his political activities:
First you make an appeal to reason—you show them all the reasons for the high prices of machines; for the formation of this co-operative; how it would have to operate if it were going to make the full savings possible. And, when you finish that you then make the emotional appeal because the simple fact, of course, it that people don’t act from reason; they act primarily from feeling. You must make that appeal to feeling effective. How then in this particular case do you make it effective? Very simply: when I finish it all I say, “There now, I have put this whole proposal before you. It’s up to you. Can any one of you tell me of any other way whereby the machinery prices can be reduced other than the way I have put forward. Maybe there is another way. If there is, I would be very glad to hear it. But, if you can’t give me any other alternative, knowing that ... you need to have machinery prices lower ... then you must accept that this is the only way ... If you go out of this hall without signing up, for heaven’s sake don’t make your wife’s life miserable or yap to your friends about the high cost of machinery because you have decided tonight not to change things as they are. So you have made your bed and I recommend that you just lie on it ... Now the result of that [appeal] was that nobody could get out of ... that meeting unless they slunk out of the door. But then, for that matter, I always had a table at the door. [34]
Brown made an impact almost immediately: of the $9,000 raised from farmers in Manitoba in 1940-41, he raised nearly half of it. [35] By October, 1941, largely under his direction, the Manitoba campaign had raised $28,900, [36] and by 1943 the total had reached $47,000. [37] In Saskatchewan the campaign was initially under the direction of Harry Fowler but in 1941 it passed to George Munro, a wheat pool employee who, in the early thirties had been Fowler’s business partner in Wilcox. [38] The Saskatchewan campaign was significantly different from its Manitoba counterpart in that it relied heavily on the work of the fieldmen of the Saskatchewan Wheat Pool. In 1938, the Pool had formally adopted a policy that it would encourage the development of all kinds of co-operatives. From that point on, Pool fieldmen had organized hundreds of credit unions and co-operative stores and had promoted the development of sister co-ops like the dairy and livestock pools. [39] Co-op Implements became just another cause to add to their list. They spoke about the implement programme at their local and district meetings; they promoted it at their three-day schools and summer school at the University of Saskatchewan. [40] In short, the C.C.I.L. campaign fitted into their existing work, and largely because of that established network and process, the implements programme gained rapid success. By the end of the 1940-41 campaign, over $30,000 had been raised from farmers. [41] It was increased to $106,000 by October, 1941, [42] and to $171,000 by early 1943. [43]
The Alberta campaign was the most difficult to develop. The main problem in Alberta was that the manager of the Wheat Pool, R.D. Purdy, was a conventional businessman who restricted the activities of his fieldmen and counselled the board against new, broad initiatives, especially since the Pool was still paying back loans owed to governments for the economic collapse of 1929-30. [44] Moreover, the U.F.A. movement, through which many earlier contacts had been made, had disintegrated following the collapse of the U.F.A. government in 1935. Thus, though the U.F.A. Co-operative, under the management of the generally supportive Norman Priestley, half-heartedly supported a machinery co-operative idea, it had limited influence and few resources. Consequently the early organizers in Alberta, particularly Ed Peterson, had few networks that were readily available. The problem is reflected in the amounts of money invested in the organization by Alberta farmers. The 1940-41 campaign attracted only $2,000, [45] and by October, 1941, the amount was still the same: [46] In late 1942, “Jock” Brown was sent to Alberta on a part-time basis (he remained in charge of the Manitoba campaign as well); by 1943, because of his leadership and the efforts of officials from the U.F.A. Co-op, the investments from farmers in Alberta has risen to $19,000. [47] It was still not as much money as the organisers of the co-operative would have liked, but it indicated a growing level of support.
C.C.I.L. employees in the mid-1940s
Source: Archives of Manitoba
Viewed in a broader perspective, the development of the company between 1940 and 1943 was satisfactory because it was struggling against two major difficulties. In the first place, unlike the Grain Growers Grain Company in the 1906-1910 period or the wheat pools in the 1920s, C.C.I.L. was selling a vague programme. From the beginning, it was unclear whether the ultimate goal was to manufacture equipment, to serve as a dealer network, or to become part of an international co-operative implement programme. It was built on a range of dissatisfactions in the country-side, and its leaders could not assess the possibilities until they knew the extent of farmer support. In the interim, all they could do in order to address directly some of the needs clearly evident among farmers was to operate a used machinery programme. This they did do by offering, on a commission basis, to advertise used, surplus machinery throughout the region. This service was useful, particularly, according to some reports, in facilitating the movement of equipment from the central plains to the parkland areas. [48]
Secondly, C.C.I.L. was struggling against the restrictions of wartime. By October 1943 when it had over $237,000 in capital invested by its farmer-owners, [49] the company was prepared to take one of several alter-native courses of action. The first preference was to begin the manufacturing of small implements on a modest basis, but this was impossible because of war-time restrictions on the use of steel. [50] This restriction proved to be more significant than was at first recognized because it meant that the company fell behind its already well-established competitors, the big manufacturing concerns, who modernized during the war through defence contracts, thereby becoming very competitive at war’s end. [51] The only real alternative that seemed available amid the war-time limitations was to enter into an arrangement with American co-operatives which already manufactured farm implements. On June 25, 1942, I. H. Hull, General Manager of Ohio Farm Bureau, met with the Executive Committee of C.C.I.L. and described the programme developed by American co-operatives since the mid-1930s to manufacture tractors for their members. [52] Fowler was particularly impressed by the American progress made through National Farm Machinery Co-operatives which operated a 35,000 square foot plant in Shelbyville, Indiana. [53] He was largely responsible for C.C.I.L. becoming a participant in the National Co-operatives programme by ordering 500 tractors at cost plus ten per cent; by investing immediately $10,000 with a further responsibility of investing another $40,000; and by agreeing to furnish another $25,000 should further capital be needed. [54] This arrangement became important in promoting the last big campaign to sign up members and raise capital, the campaign of 1944-1945.
For Harry Fowler, the future for the implement co-operative lay in closer ties with the American programme. He envisioned a large international farm machinery co-operative that would be able to compete with the major machinery companies such as John Deere and Massey-Harris. In a sense, this was a natural progression for Fowler who was always a restless, creative leader who, in the course of his co-operative career, organized, worked for, or served on the boards of, numerous co-operatives including (in addition to the refinery, and C.C.I.L.) the following: the Wilcox co-operative; the Sherwood Credit Union; the Regina Co-op; Interprovincial Co-operatives; Saskatchewan Co-operative Credit Society; Co-operative Trust; Federated Co-operatives; Co-operative Guarantee and Fidelity Company; Federated Agencies; Saskatchewan Co-operative Superannuation Society; Funeral Co-operative Association; Publications Co-operative Association; Co-operative Union of Saskatchewan; Co-operative Fisheries; Tisdale Co-op; and Sherwood Co-op. [55] He was a compulsive organizer, who delighted in mobilizing membership support, in fashioning organizational committees, and in creating new institutions. He was not as successful as a day-to-day manager, at least according to some observers, [56] but as a type of leader necessary for the development of new co-operatives he played a vitally important role. More than any other person, he brought together the diverse elements needed to create the necessary momentum and raise the required capital. This was not an easy task because energizing the co-operative movement is never easy, as he later observed when recalling the struggle to develop C.C.I.L.
When we talk about enemies or opposition to the co-operative movement we talk about the Chamber of Commerce and all these kinds of people—they never offered any effective opposition to the co-operative movement—the opposition I had to overcome throughout my history has been people within the co-operative movement who said this couldn’t be done. [57]
In his restless search for new challenges and broader approaches, Fowler agreed in 1944 to go to National Farm Machinery Co-operatives as manager. It was a mistake in his own career as he was not welcomed by the management group he was hired to lead, and he lacked sufficient technical expertise. He returned to Saskatchewan a year later but by that time another “co-operative entrepreneur,” J. B. “Jock” Brown, had taken over leadership of the company.
Brown shared some of Fowler’s flamboyance as a speaker and was at least his equal in organizing groups of people. But Brown’s view of how the company should develop was dramatically different from Fowler’s. Instead of trying to become involved in a risky, large-scale international co-operative manufacturing concern such as the one at Shelbyville, he had a different vision of what the company’s purpose and future were to be. He later summarized this vision as follows:
It was to reduce the price of machines by the elimination of distributive waste; that means the avoidance of the practices of competitive business; carrying on the business in accordance with the realities of our being as a co-operative and on the basis of the simple fact that capitalism can always build cheaply—it can never distribute cheaply. The waste in our economy in the distribution of goods is simply appalling, and that is the case with farm machines. But don’t ever think it is possible to build machines more cheaply than Deere or Massey. [58]
Men at work, C.C.I.L., circa 1944
Source: Archives of Manitoba
Thus in 1943 and 1944, while Fowler was proposing the “big” alternative in Shelbyville, Brown was advocating a more cautious route. He gained his chance as Fowler negotiated with, and finally moved to, National Farm Co-operatives. In September, 1944, Brown, having been selected by the Board of Directors to succeed Fowler who was moving to Shelbyville the following month, proposed that, in addition to working with National Farm Co-operatives, C.C.I.L. emphasize two other opportunities: first, signing a contract with an eastern manufacturing company, Cockshutt, to sell some of their machines in western Canada; and second, purchasing a small plant in Winnipeg, the Gregg Manufacturing Plant, to begin the manufacture of smaller implements. [59] Although he didn’t state so publicly at the time, Brown was convinced that National Farm Co-operatives was headed for disaster and could not compete in the capital intensive implements business. [60] His proposal met with considerable skepticism, particularly from Saskatchewan leaders probably resentful that Brown, a Manitoban, had succeeded Fowler, but it did gain the support of the majority of the Board of Directors.
On the following day, at a meeting of C.C.I.L. directors with T.C. Douglas, premier of Saskatchewan, Stuart Garson, premier of Manitoba, representatives from the Alberta government, and representatives from the major co-operatives, particularly the pools, Brown threw down a challenge to the group. He pro-posed that C.C.I.L. launch a campaign to raise $700,000 from farmers on the Prairies and, when that was done, the provincial government and the co-operative organizations would invest $2,000,000 in the co-operative. At least some in the room, particularly James Brownlee, the former premier from Alberta, thought the proposal was impossible, but the majority agreed and their judgement proved sound—or nearly so. [61]
During 1944-45 and 1945-46, under Brown’s leadership, C.C.I.L. launched two large sign-up campaigns. New pamphlets were printed; radio—even the national programme, Farm Radio Forum—was used effectively to stimulate interest in the organization; the co-operative networks used in the past were used even more effectively; and representatives from the organization spoke at nearly all the major meetings of co-operatives in the region. By 30 October 1945 share capital had increased to $831,800 ($130,200 from Alberta, $227,500 from Manitoba, and $474,100 from Saskatchewan). [62] By 31 October 1946, the total amount had reached $852,000, [63] about $100,000 short of Brown’s goal announced two years earlier but enough to ensure the stability of the organization to permit entry into a contract with Cockshutt, and to begin manufacturing some implements at its Winnipeg plant. In the meantime, the agreement entered into with National Farm Machinery Co-operative had fallen apart, the victim of inadequate unity among American co-operatives and a deteriorating market situation in the United States.
Brown’s approach exemplifies some other typical dimensions of Canadian co-operative entrepreneurship. He had strong bonds to, and a rich affinity for farm people, in his case largely because of his social democratic leanings, leanings that became more radical as the years passed; he developed the company so that it would respond to the needs and innovations of ordinary farmers; he ran a company which paid relatively low wages; from his employers he demanded loyalty to a cause he believed in; he was often autocratic; and he did not suffer gladly those within the co-operative movement who criticized him about C.C.I.L. In short, in the uncertainties caused by the almost endless networks and the structural diversities of co-operatives, Brown was a determined, sometimes ruthless, and heavy-handed manager similar, in many respects, to managers of other co-operative enterprises, particularly those in their early years of operation. [64]
In their remarkable book, Prairie Capitalism, John Richards and Larry Pratt argue effectively that, because of the political economy of Canada, the governments of Saskatchewan and Alberta, in conjunction with indigenous elites, have been major participants in forging the Prairie region’s pattern of economic growth. Rather surprisingly, this study completely ignored co-operative entrepreneurship, an important Prairie phenomenon different in key respects from either government-led development or traditional capitalism (in either the small business of international varieties). The early development of Co-op Implements demonstrates some of the qualities of this unique kind of economic activity. It emerged within a distinct context profoundly shaped by the regional experience. It worked through powerful networks and, by its nature, demanded that its leaders possess the ability to use those networks effectively. It required organizational skills rarely if ever necessary in the government or private business. It ultimately required a tough, domineering figure in the person of “Jock” Brown to create order out of chaos. It worked out its own particular relationship with government. It relied on the loyalty of its members to raise capital and provide support. It operated within an “institutional culture” that ultimately possessed a clear vision of what it wanted to do and of how it was different from other organizations. It struggled against the internal problem of competing ambitions, provincial differences and innate conservatism.
In retrospect, too, the way in which C.C.I.L. developed was generally typical of how new initiatives have been undertaken within the Canadian co-operative movement. The Grain Growers Grain Company and the pools—of various kinds—were started by large campaigns financed and supported, at least in part, by other co-operatives and governments. They relied heavily on organizers who, like Fowler and Brown, were not easily controlled by the more cautious groups frequently dominant in co-operatives. They succeeded because, as Brown put it, they appealed to feelings while they promised to satisfy some crucial needs. The other great initiatives of the 1930s through the 1950s—the development of credit unions, the establishment of Co-operative College, and the creation of a national financial structure involving life insurance companies, a trust company, and a national credit union organization—similarly relied on significant support from established co-operative organizations. Only the consumer movement—and that was back in the 1920s and 1930s—followed a pattern of building organizations almost exclusively on local resources and then developing wholesales, their central organizations.
The significance of the more common pattern becomes clear when one considers the lack of major new initiatives within Canadian co-operative circles after 1960. While sectors have undertaken expansion within their own fields—such as credit unions adopting new technology or Federated Co-operatives entering new fields of activity in the petroleum industry—few major new, broad-based projects have developed. Co-operative housing developed through government programmes brought about by the lobbying of a few enthusiasts and not because of a major initiative by co-operatives. Similarly, the development of northern co-operatives has taken place because of the enthusiasm of public servants; established co-ops have shown only a passing interest. In recent years, too, despite a fairly widespread interest in worker or employment co-operatives, the movement has done little to help their development. [65] There are, of course, reasons for the decline of broad-based initiatives. These include the growth of managerial cadres with overwhelming concern for immediate gains, the decline of broad perspectives among directors, and the loss of organizing skills. Or, put another way, the decline may best be seen by contrasting the inertia and institutional limitations of recent years with an understanding of how co-operative entrepreneurship, building on context and networks, worked in the past. One example is the history of the establishment of Co-operative Implements, an organization which, whatever its later difficulties, in its early years followed the classical model of co-operative development in Canada.
1. For a more complete statistical summary of the Canadian co-operative movement, see Co-operative Canada, 1985 (Ottawa: Co-operative Union of Canada, 1986).
2. Canadian Co-operative Implements Limited began operations in 1944 when it purchased a plant in Elmwood, on the outskirts of Winnipeg. Under the aggressive leadership of J.B. “Jock” Brown, it developed into a strong company, although it always had difficulties in developing a reliable supply for tractors and in generating adequate capital. The company was adversely affected in the interest rate squeeze of the late 1970s and early 1980s and at the same time lost market share. The manufacturing facilities were closed in 1985 although fifty depots remain scattered across the Prairies to service equipment.
3. See B. McCutcheon, “The Birth of Agrarianism in the Prairie West,” Prairie Forum I (1976), pp. 79-94.
4. See B. McCutcheon, “The Patrons of Industry in Manitoba, 1890-1898,” Historical and Scientific Society of Manitoba Transactions, 1965-66, pp. 7-26.
5. The literature on these movements is immense. For summaries of their development see V. C. Fowke, The National Policy and the Wheat Economy (Toronto: University of Toronto Press, 1957); W. P. Davisson, Pooling Wheat in Canada (Ottawa: Graphic Publishers, Ltd., 1927); and W. A. Maclntosh, Agricultural Cooperation in Western Canada (Toronto: Ryerson Press, 1924).
6. For a more complete summary of the co-operative movement on the Prairies, see I. MacPherson, Each for All: A History of the Co-operative Movement in English-Canada, 1900-1945 (Toronto: Macmillan of Canada, 1979).
7. J. F. C. Wright, Prairie Progress: Consumer Co-operation in Saskatchewan (Saskatoon: Federated Co-operatives Ltd., 1956), pp. 122-149.
8. Canada, Report of the Royal Commission on Price Spreads (Ottawa: 1935), p. 66.
9. Saskatchewan, Report, Select Special Committee on Farm Implement Prices and Distribution (Regina: 1939), p. 26.
12. B. N. Arnason, “Organization of Canadian Co-operative Implements,” Memoirs, typescript in possession of author, p. 10.
13. For a biography of Fowler, see Terry Phalen, Co-operative Leadership: Harry Fowler (Saskatoon: Co-operative College of Canada, 1977).
15. Fowler’s submission was printed as Appendix A of the report of the Select Special Committee.
16. For an analysis of the Saskatchewan dairy industry which dwells on the problems of top-down organizations, see G. Church, An Unfailing Faith: A History of the Saskatchewan Dairy Industry (Regina: Canadian Plains Research Center, 1985).
17. B. N. Arnason, “Organization of Canadian Co-operative Implements,” p. 11.
19. Report, Select Special Committee, pp. 42-44.
21. For a more complete description of the Prairie movements in the 1930s, see I. MacPherson, Each for All, pp. 118-190.
22. Report of Interprovincial Meeting to Consider the Handling of Farm Implements, Bessborough Hotel, Saskatoon, 23 April 1940,” copy in author’s possession. Copy also deposited in Canadian Co-operative Implements Limited Papers, Provincial Archives of Manitoba (All other C.C.I.L. papers referred to in these footnotes are on deposit in the same archives).
25. Report of Second Interprovincial Meeting to Consider the Handling of Farm Implements, Saskatchewan Hotel, Regina, July 24, 1940.
26. E. Braun and K. Howard, “History of C.C.I.L.,” p. 73 (C.C.I.L. Papers).
27. Directors’ Report, First Annual Meeting, p. 1 (C.C.I.L. Papers).
28. See I. MacPherson, “Missionaries of Rural Development: The Fieldmen of the Saskatchewan Wheat Pool, 1925-1965,” Agricultural History, forthcoming.
29. Directors’ Report, First Annual Meeting.
30. Auditor’s Report, 20 January 1942, p. 1 (C.C.I.L. Papers).
31. B. N. Arnason, “Organization of Co-operative Implements,” p. 16.
32. Interview, J. B. Brown, Winnipeg, 2 July 1976.
36. Auditor’s Report, C.C.I.L., 20 January 1942, Schedule 2.
37. Auditor’s Report, C.C.I.L., February 1944, Schedule 1.
38. Interview, G. Munro, Regina, 15 August 1976.
39. See I. MacPherson, “Missionaries of Rural Development,” Agricultural History, forthcoming.
40. Interview, J. Forrest, 4 March 1986.
41. E. Braun and K. Howard, “History of C.C.I.L.,” p. 86.
42. Auditor’s Report, C.C.I.L., 20 January 1942, Schedule 2.
43. Auditor’s Report, C.C.I.L., 1 February 1944, Schedule 1.
44. Interview, J. B. Brown, 2 July 1976.
45. E. Braun and K. Howard, “History of C.C.I.L.,” p. 86.
46. Auditor’s Report, C.C.I.L., 20 January 1942, Schedule 2.
47. Auditor’s Report, C.C.I.L., February 1944, Schedule 1.
48. Minutes, Directors’ Meeting, C.C.I.L., 27-28 July 1942, p. 13.
49. Auditor’s Report, C.C.I.L., February 1944, Schedule 1.
50. History in the Making,” undated pamphlet on C.C.I.L., Co-operative Union of Saskatchewan Papers, Saskatchewan Archives Board, file 10e.
51. B. N. Arnason, “H. L. Fowler as Co-operative Leader,” Epilogue in T. Phalen, Co-operative Leadership, p. 200.
52. See “Informal Meeting—June 25th, 1942—Regina, Sask. with Mr. I. H. Hull, General Manager, Indian Farm Bureau,” C.C.I.L. Papers.
53. For a fuller description of National Co-operatives, see J. G. Knapp, The Advance of American Co-operative Enterprise, 1920-1945 (Danville, Ill.: Interstate, 1973), pp. 497-99.
54. E. Braun and K. Howard, “History of C.C.I.L.,” p. 89.
55. Interview, H. L. Fowler, 15 June 1972.
56. Interview, J. B. Brown, 2 July 1976.
57. Interview, H. L. Fowler, 15 June 1972.
58. Interview, J. B. Brown, 2 July 1976.
59. See Minutes, Meeting of the Board of Directors, C.C.I.L., 25 September 1944, C.C.I.L. Papers.
60. Interview, J. B. Brown, 2 July 1976.
61. Interview, J. B. Brown, 2 July 1976.
62. Auditor’s Report, C.C.I.L., 11 December 1944, Schedule 2.
63. Auditor’s Report, C.C.I.L., 20 February 1947, Schedule 3.
64. Some examples, although personalities are certainly different, could include H.A. “Buck” Wagner of Co-operative Trust, James A. McPhail of the Saskatchewan Wheat Pool and R. D. Purdy of the Alberta Wheat Pool.
65. For a defence of the inter-institutional, broad-based approach as opposed to a decentralized, locally-based approach in the development of worker co-operatives see J. Jordan, “A System of Interdependent Firms as a Development Strategy,” Paper presented for the International Seminar on Labour Ownership and Workers’ Co-operatives, University of Orebo, Sweden, 13-17 June 1983.
