igth century the movement was content to proceed on its way of steady development in a certain amount of obscurity. This is no longer the case: cooperators have begun to claim the place to which their numbers and operations entitle them in the econom- ic life of their country. These claims can be stated shortly as follows: Consumers' cooperation is a system which ensures a democratic control of industry by the community organized as consumers. Every consumer can join a society and every member has one vote and can, if he cares to do so, -exercise an equal power of control over the conduct of industry. The dividend on purchase ensures that commodities are supplied to consumers at cost price and that, therefore, profit is eliminated. Under cooperation production and the various spheres of industry from banking to insurance, from the production of raw materials to the distribution of manufactured articles across the counter of the shop or store, are all carried on for use and not for profit. This system has already shown that it can adapt itself to one economic sphere after another and there is no reason to suppose that the scope and range of cooperative industry are not capable of almost indefinite extension. The movement, with its 4 million members, already represents from 12 to 15 million con- sumers or more than one-quarter of the population, and con- sumers' cooperation is now, in fact, an alternative to the ordinary capitalist system of controlling industry.
These claims and ideals are being put forward and are un- doubtedly having an effect upon the development of the move- ment. They are not held consciously by the vast mass of the 4 million members, but they are slowly penetrating the move- ment, largely owing to the educational work of the societies and the Cooperative Union and also of a very active and influential cooperative organization, the Women's Cooperative Guild, which has a membership of nearly 50,000 women members of cooperative societies.
The increase in cooperative activity and in the consciousness among cooperators of the importance and capacities of their movement are partly the effects of the war. It might have been expected that the dislocation in the economic life of the country and the difficulties of food supply would have had an adverse effect upon a working-class movement like the cooperative move- ment. The facts show that the reverse was the case. The mem- bership of retail societies, for instance, rose from 3,054,000 in 1914 to 4,131,000 in 1919, an increase of 35%, while the in- crease from 1909 to 1914 was only 24%. This increased rate of growth was partly due to the rise in prices and the popular irritation against " profiteering," for the elimination of profit- making and the dividend on purchase tend to keep prices down in the cooperative store and make " profiteering " impossible.
Reference has also been made above to the way in which cir- cumstances connected with the war led to an extension of the productive and distributive activities of the C.W.S. But the war had another effect upon British cooperators: rightly or wrongly there grew up in the movement a widespread conviction that it was being victimized in the interests of private traders. Definite complaints were made of unfair treatment of cooperative societies and their staffs by military service tribunals and of discrimination against cooperative .organizations in the allocation of Government-controlled supplies. The decision of the British Government to tax cooperative societies by means of the Cor- poration Profits Tax brought the dissatisfaction of cooperators to a head. The argument was freely used that the movement, in order to protect itself against political action, must " enter politics." In 1917 the whole question was discussed at the Cooperative Congress, and a resolution was passed that the movement should enter politics and nominate candidates in constituencies as an independent unit, but that it might work with other organizations having similar aims and objects. Sev- eral cooperative candidates stood in the general election of 1918 and one was elected. The Cooperative party was still in its infancy in 1921 and any estimate of its future was impossible. One feature of the tendency which it represented must, however, be noted. There was a considerable body of feeling in the move- ment which held that the Cooperative party should unite with
the Labour party and trades union movement to form a " Labour and Cooperative Political Alliance." On the other hand a large number of cooperators were not prepared to accept this proposal. The whole scheme for such an alliance was in 1921 still under discussion in the movement.
Another problem - which has assumed great importance in recent years for cooperators is their relations to their employees. In 1919 the consumers' societies employed about 17 5,000 persons, of whom about four-sevenths were employed in distribution and three-sevenths in production; the wages and salaries paid to these employees amounted to about 20,000,000 a year. The relations between the movement and its employees have been complicated until recent years by a misunderstanding as to the nature of consumers' cooperation. Cooperators themselves did not dis- tinguish clearly between the control of industry by the com- munity organized as consumers for use and not for profit (con- sumers' cooperation) and the control of industry by the workers or producers in self-governing workshops or factories in which the profits were divided among the workers (producers' co- operation). Hence arose a certain school within the consumers' movement which held that the employees of consumers' societies should share in the " profits," although the dividend on purchase eliminates " profits " in the sense in which a joint stock company or a self-governing workshop makes a profit. The illogicality of this position was, however, gradually realized, and in 1921 very few societies paid the bonus on wages by which the cooper- ative employee was given a " share in profits."
The cooperative employee was therefore recognized to be merely a wage-earning employee of the democracy of consumers. But the movement, as a large employer of labour, was brought face to face with many new problems. As an employer it stood in a peculiar position. It was composed mainly of the manual wage-earning class, and a very large number of its members were naturally trade unionists. It always professed to pay good wages and to give the best possible conditions of employment. But it was competing with the businesses and factories of the ordinary capitalist type, and competition was so severe that cooperative trade and industry would soon be killed out if wages and con- ditions of employment within the movement were such as to raise the cost of production substantially above that of its rivals. Most people agree that on the whole the conditions of the co- operative employee compared very favourably with those of employees of private firms and companies, although there were still societies in which wages, etc., were bad. The movement had, however, increasing difficulties with organized labour.
Up to 1920 large numbers of cooperative employees were organized in a special trade union, the Amalgamated Union of Cooperative Employees (membership in 1920, 90,000). This union was founded in 1891, and it throws some light upon its original relations with the cooperative employer that in the original rules there was no provision for strikes. But this happy situation could not and did not continue. The presence of large numbers of trade unionists within the movement means that any demand for increased wages will probably receive some sup- port within a society. There is no doubt that organized labour to some extent took advantage of this fact: a demand for increased wages or shorter hours was often first made upon cooperative societies, with the intention that, when the cooperators had given way, labour could then go to non-cooperative employers and demand that they should pay the same wages or give the same conditions as cooperators.
These facts and conditions gradually led to strained relations between the movement and its organized employees. As a whole the movement stood as strongly for trade union recognition and for the payment of trade union rates of wages as the trade unions themselves, indeed several societies insisted that their employees should be members of their unions. There had also been for long in existence joint machinery of the movement and the unions for settling industrial disputes by conciliation and arbitration; but for various reasons this machinery did not work satisfactorily, and in 1911 the Amalgamated Union of Cooperative Employees began a more militant policy and made provision for a strike
