In today’s world, much is made of ‘identities’. Social identities have always been important, especially in politics. What is noteworthy is how our identity preferences have shifted over time.
Last October CCEC Credit Union merged with Community Savings. In the preceding two years I was asked about the prospects for CCEC as a small independent credit union. I noted that the ‘bond’ among CCEC’s member co-ops, community organizations, and arts groups was much thinner than it once had been.
I was drawn into the world of credit unions in the 1970’s when a new credit union was being formed. CCEC Credit Union promised to provide services and low cost loans to community organizations and good community-based projects; ‘aggregating and mobilizing small deposits to make a difference’. It was rooted in a youthful, animated, social identity of the time. CCEC was part of a counter-culture movement which created a wide array of community organizations in a spirit of collective action; Vancouver Co-op Radio, Vancouver Folk Music Festival, food co-ops, health clinics, women’s’ shelters, housing co-ops, day cares, independent schools, etc..
In recalling those days, I can appreciate the ethic of ‘we can do it ourselves’. People bonded in a group to build something. While the term ‘social identity’ was only being developed in the field of social psychology in the 70’s, it is clear in retrospect that ‘social identity’ and group solidarity made these projects successful.
The earlier pioneering days of credit unions in BC bears this out as well. Credit unions were created in the 1940’s by ethnic groups, church groups, employee groups, and neighbourhood groups. Legislation used the term ‘common bond’. There was a presumption of a social identity that ‘bound’ the membership together and enabled them to build their own credit union. So, we had the Polish Credit Union, Caisse Populaire Saint Sacrement, Scott Paper Employees Credit Union, Union Bay Credit Union, and many more.
What is remarkable is that the mobilization of groups in this way has waned so dramatically in the last fifty years. Approximately 300 credit unions were founded in BC between 1940 and 1975. Only a handful of credit unions have been incorporated since 1976, two of which still exist; Khalsa Credit Union (principally serving the Punjabi-Canadian community) and Sharons Credit Union (serving the Korean-Canadian community).
The way British Columbians see the world has changed; they are more socially ‘liberal’, more active ‘online’, and more ethno-culturally diverse. Overall, people and organizations are viewing the the world in transactional and utilitarian terms. ‘What’s in it for me.’ A project that is communitarian in nature, that benefits others with whom you share a bond, does not have the same appeal.
The cultural shift has led the credit union sector to down-play the concept of ‘common bond’, and adopt ‘open bonds’. The original political projects which united members of an immigrant community, a parish, or a workplace have been re-framed. Greater emphasis has been placed on ‘competitive’ financial services, business growth, and the needs of middle class households. This approach has facilitated the growth of large regional credit unions such as Vancity, First West, Prospera, and G&F Financial.
So how does the ‘social identity’ that contributed to the building of credit unions, co-ops, and other projects in the past contrast with those present in our world today? It is pretty clear that social identity in the 1950’s revolved around family heritage, religion, employment and similar factors. Seventy years later other ‘identities’ have become important; race, sex, sexual orientation, gender identity, age, ability, etc. Some young people seem to attach their identify to health conditions such as anxiety and eating disorders, or to surviving a psychological ‘trauma’.
Our current ‘social identities’ lead to debates related to ‘human rights’ and access to services. Notably, these identities do not generate the same kind of community-based projects that we saw decades ago. These identities lead to different kinds of political projects.
But the new ‘social identities’ also have another consequence, they do not challenge conventional business ownership models. The current focus on ‘rights’ and public policy relies on the ‘state’ to be the regulator in the market, it does not call on a local community to actively take part in that market. Further, many community services are no longer locally driven, but reliant on funding from senior government bureaucracies. One might idly wonder whose interests are best served by these trends.
In Michael Lind’s book, The New Class War: Saving Democracy from the Managerial Elite, he observes that there has been a distinct decline in many other forms of local organization; such as service clubs, churches, labour unions, and civic political alliances. And he sees power being shifted to a technocratic class, and centralized, as working people and small businesses are squeezed out.
What about local, democratically owned, enterprises today?
Consumer co-operatives bring a locally accountable and responsive ownership structure that can directly reshape a local market. Co-ops and credit unions have challenged oligopolies in food retailing and banking. Upcountry, co-ops have provided important access to foods, fuels, and fertilizers. Across BC, credit unions have been key to providing savings accounts, personal credit, and mortgages to ordinary people. Co-ops and credit unions, as direct participants in the market, have ensured there is competition and fair service to all households.
However, this kind of direct democracy is not fashionable. Many co-ops and credit unions are closing or being ‘merged’. Large credit unions have become more bank-like and rely on conventional marketing techniques to attract and retain ‘customers’. Member (/owner) engagement and participation in the governance of large credit unions is remarkably low.
I have to wonder if the future of the co-op model will be where the needs (and social identities) are akin to those in generations past; immigrant communities, some worker groups, small towns, etc. The focus could once again be on the needs of ordinary people who are not well served, even with the growth of online retailers and banks. Credit unions (or some facsimile) would likely be ‘niche’ players without all the bells and whistles.
At CCEC a few years ago, Fridays would see line-ups of Spanish-speaking young men . They were there to cash their pay checks and avoid big fees at the ‘check-cashing’ outlet down the street. These were recent immigrants, some undocumented, who were fortunate that their employer banked at CCEC. Many of these young men would not be able to open accounts at larger institutions because they had limited history in the country and lacked a credit score. This group certainly suggested the possibility that the Spanish-speaking immigrant community might be mobilized to ensure these working people were better served.
But I may be an idealist.
In the end, the co-operative business model is rooted in a ‘social identity’; a group identity that leads to group action in the interest everyone’s economic welfare. “Each for all.” In today’s consumer culture, we no longer celebrate that kind of project. However, there is a possibility that this kind of ‘co-operation’ can be rediscovered.