Now It's Weaver Consumer Woes -- $3 Dividend

In among all the erroneous chatter the Board and corporate office of Weaver Street Market Co-operative are currently sending to consumer-owners about the supposed financial health of WSM, those of you who are consumer-owners will by now have worked out that it is not just the workers of WSM who are suffering financial woes. In contrast to the Board and corporate office's declarations of financial nirvana.

Tucked away at the back of the expensive-looking Board brochure that just thudded its way into your mailbox is the information that, in return for the WSM Board and corporate office taking away your 5% consumer-owner discount two years ago, they have just decided to give you a dividend of - wait for it - $3.

Of course, we are told, the amount of your dividend is as low as it is so that you can further help to build the financial strength of our community co-op. Um. Arrant nonsense.

And that the discount-to-dividend process is a nationwide phenomenon, designed to strengthen co-op's all across the nation by encouraging much-needed loyalty in co-op's. Er. Half true.

The WSM dividend is low in order to help build the strength of WSM? Hmm. The dividend is low:

1) Because we are still paying off $2 million a year on the undemocratically-raised debt, that was used to finance the failed capital expansion of 2007/2008. And, unless consumer-owners use the opportunity of the current feedback exercise to request change, we will be paying off at that rate for the next four years.

I continue to suggest that the sensible way forward is immediately to establish a Board Committee of Owners to undertake a thorough review of the debt, and to make recommendations as to its early disposal.

This would free up $2 million a year, which could then be used to invest in much-needed improvements, reward long-suffering owners with real dividends, and improve the lot of your hard-working, over-stressed workforce.

I first put forward the idea of such a Committee at the Annual Meeting in 2008 (um, we no longer have Annual Meetings; we have 'tables'). The Meeting agreed. The Board and the corporate office then undemocratically overturned the decision of the Annual Meeting of Owners. And here we are. With a $3 dividend.

2) Because the bulk of this year's financial 'profit' is being retained by the WSM corporate office, to build a capital fund, against which more monies will be borrowed (yup - MORE debt), in order to finance unspecified, undiscussed capital projects.

I have suggested that the Capital Plan first be discussed openly. That it should be costed. And that absolutely no funds should be set aside or monies borrowed until owners have approved the Capital Plan, and have given their specific authority to spend monies on it.

As for the claim that WSM is merely following the example of other co-op's around the nation, in changing the discount into a necessarily-smaller dividend, I say, 'almost.'

The concept is one called 'Economic Owner Linkage,' and was devised by a Professor Brett Fairbairn, with whom I have been in correspondence.

Not least when we agreed that Director Elections in a truly open and democratic co-operative are not the be all and end all of democratic expression.

Directors do not have carte blanche to do what they like. Their election represents merely the first step in co-op democracy.

Elections choose the folks we co-operators want to have structure the ongoing democratic conversation within our co-op.

Frankly, there is next to no conversation within our co-op. Conversation suggests two-way, immediate, accountable dialogue, where the outcome is determined by all those taking part in the conversation, not just a corporate office or Board operating a veto at the conclusion of the exercise.

Specifically, it is not one-way 'feedback.' Nor is it a 'Suggestions Box.'

The essence of 'Economic Owner Linkage,' if it is properly implemented, is that it is a deal.

In return for owners agreeing to have the return on their investment based upon the performance of the co-op, the co-op opens up the democratic process, to ensure that owners actually control that performance.

The Board of WSM are well aware of this. They attached Brett's report on the subject to one of their Board Minutes. Is there a consumer-owner out there who feels that, in return for replacing 5% with $3, they got more democratic conversation or more control of the performance of the WSM Board and corporate office?

Well, if you are a consumer-owner who feels that didn't happen, then now is your chance to ask for it.

Complete the WSM Feedback Form. Sigh - it's at least an opportunity to START a conversation.

Would you mind if I had a few suggestions for completing the WSM Survey - which can also be found online?

Question 1 -- Might I suggest that the most important of the proffered suggestions are (excuse the abbreviations): downtowns, food system, worker conditions, and product quality?

Question 2 -- This might be your chance to ask for more democratic control of the performance of WSM, as your promised 'return' on a smaller financial return.

You might want a restoration of Annual Meetings, more elected (as opposed to appointed) Directors, an online discussion forum, or a Consumer-Owner Discussion Group.

Question 3 -- Again, might I suggest the important proffered goals are: survival, savings and debt?

Question 4 -- (a) The Capital Plan first to be submitted to the ownership for approval; (b) Savings to be spent on new capital projects, only after projects are approved by owners; (c) No more long-term borrowing by WSM without the prior approval of owners; (d) A Board Committee of Owners to be established to review the existing long-term debt of $8 million, and to make recommendations for its early disposal; and (e) [This is a weird one; the WSM Survey touts improving worker conditions in Question 1, but not as a financial goal in Question 3; er, how do you improve worker conditions without it being a financial goal? So ... ] Establish a Committee of Worker-Owners immediately to draw up plans for improving worker conditions.

Question 5 -- Up to you!

Question 6 -- Ditto!

Question 7 -- The last few years have seen the WSM corporate office and its Board concentrate power in the hands of a self-selected few. It is time for this to be reversed, so that workers and consumers in our worker-consumer co-op are truly those who democratically control decision-making and performance in our community co-op.

I would suggest you might ask that, once Annual Meetings are restored, motions are allowed. They are not at the moment.

I would also suggest that the Board be stripped of the power it gave itself to change By-Laws without the approval of ownership. That's how $10 million was borrowed without owner knowledge in 2007/2008.

The path to true, sustainable financial health in our community co-op is to abide by the simple truisms that work for successful co-op's all around the country.

Sell what the consumers want, in the way workers want, by putting control in their hands, not in the hands of a self-selected few.

Spend only what you earn. Borrow as little as possible. Do nothing if it does not serve the common needs of your consumers and workers.

And, if you think you may be stepping outside those sustainable limitations, put in place a process that allows you to do so only after the most stringent, democratic and accountable consultation.

Now, try fitting that in the little box provided by the WSM corporate office in their consumer-owner survey ... !!

[This is a re-print of an article first posted on OrangePolitics.]