Between 1874 and 1931 a cluster of cooperative cooperages - barrel factories - operated in Minneapolis. Entering early to the market for flour barrels in what became the largest wheat processing city in the U.S., the cooperatives were a majority of the local industry in the 1880s before being shaken by increased competition, mechanization, and a dwindling market. The first successful cooperative was given contracts from a sympathetic industrialist, Charles Pillsbury, namesake of the contemporary Pillsbury Company.
During their peak the success of the cooperages inspired the Knights of Labor to champion worker cooperatives and support the creation of dozens of enterprises with a utopian vision for the working class. However, unable to adapt to the changing industry, the cooperatives did not maintain solidarity. The longest running firm, the North Star Barrel Company, operated for an impressive 53 years, but was the least interested in federating with the others as conditions declined, and took contracts from millers that refused to pay the rates demanded by the federated coopers. At a peak of 14 cooperative cooperages, the number declined to 7 by 1886, to 3 by 1905, and to 1 in 1924 that ceased operation in 1931. The most productive shop was able to sell 650,000 barrels a year in the first years of the 1900s. 20 years later they could only sell 5% of that, in part because flour was increasingly packaged in jute and cotton bags.
The most successful of the cluster contradict many negative assumptions about worker cooperatives - that they cannot be profitable, lasting, provide job security, or experience significant growth. The largest cooperative grew to 120 members. While workers voluntarily reduced wages during the depression of the 1870s, the 1880s provided better wages and job security than at non-cooperative firms. The cooperages also earned respect in the business community and had good credit at local banks. By 1886 most of the cooperative coopers were able to own homes. They also employed an unusually diverse mix of German, Norwegian, Swedish, Irish, and "a few Italian" workers.
While the cluster's initial organization has been classified as one of the "most cooperative" in pre-1950 American cooperative history, the longest surviving cooperatives experienced classic patterns of democratic degeneration. While they maintained a one-member-one-vote democratic process, they bought out retiring and withdrawing members without bringing new members in, concentrating ownership. When the firms did accept the mechanization of some parts of their craft, they employed machine operators who where not offered membership. Members, many of whom retired in their late 60s or 70s, did not adapt well to producing a new line of goods as markets declined. One company began to make butter tubs late in their history.
Steve Leiken's excellent historical account illuminates some of the contradictions between the cooperatives and broad working-class organizing. The secretary of one of the cooperatives in 1881 advocated that "labor creates all dividends," that cooperatives offer every worker an otherwise unattainable "practical business education," that workers can elect the use of the finest materials, and that "the cooperative system relieves all who embrace it from the tyranny of unscrupulous bosses." Left ambiguous is any responsibility to working-class solidarity in general. One conflict of interest was the need by unionized journeymen for the cooperatives to stop taking contracts during the journeymen's strikes, sometimes jeopardizing the viability of the cooperatives and with it members' economic security. Conflicts were amplified because of the erratic and shrinking market.
- Steve Leiken, The Cooperative Coopers of Minneapolis. 2002
- Steve Leiken, The Citizen Producer: The Rise and Fall of Working-Class Cooperatives in the United States. 1999
- Derek Jones, American Producer Cooperatives and Employee-Owned Firms: A Historical Perspective. 1984
- G.O. Virtue, The End of the Cooperative Coopers. 1931
- G.O. Virtue, The Co-operative Coopers of Minneapolis. 1905
- Albert Shaw, Cooperation in a Western City. 1886 (Includes 1874 bylaws)