Tape #217 -- Empowering Youth, Vitalizing Rural Communities

ANNOUNCER: Hi, my name is Angela Corley, and I work for the Department of Agriculture. And I am going to be the Moderator Facilitator today primarily here assisting our workshop presenter, and you all in making sure that you are comfortable here. First let me say, I apologize for the noise. I have asked them to see if there's anything that they can do about it, but I can't guarantee that they'll be able to do anything about it. When we had our orientation last week, we were told that there is a contract with the construction people where they're penalized a million dollars a day for any kind of delay. So, I don't know to what extent they can do anything about the noise, but know that we've tried.

QUESTION: Who owns the hotel?

ANNOUNCER: This -- pardon me? This workshop is being recorded, so as the workshop continues if you have any questions, we ask that you do come to the mich to ask your question. And if someone from the audience has any comments to make, again we ask that you come to the mich because to the extent possible we want the recording of the session to be clear. I want to welcome you to this session. This is Empowering Youth - Revitalizing Urban Communities. Is everybody in the right workshop? If not, you may want to leave now.

This workshop is being presented by a young person, which I think is wonderful, you know, given the topic of the workshop. Her name is Kristie Slosher (PHONETIC). She is a senior at the University of North Dakota. She is a member of the National Farmers Union, North Dakota Chapter. And it is my understanding that she has done an internship with that organization. So please join me in welcoming our workshop presenter Kristie Slosher ("KS").

First of all, I'd like to do a brief introduction of myself. Like I said, I grew up in North Dakota on a small farm with five younger brothers and sisters. I learned a lot about dealing with young people. I was the second mom. I was the boss, even though I was always told, "You're not the boss and we don't have to listen to you." They did. But, I grew up just north of a small town called Edgely, North Dakota, which only has 800 people. I graduated only with 17 people from high school, and so I know first hand what a small community looks like and how the problems that it faces, etc. and how North Dakota right now is losing these smaller communities. Not to urban development, which I know some communities are facing, but to some mass exodus by young people. And I think that young people my age don't recognize that there are opportunities in North Dakota, and that's a problem. And that's something that I think cooperatives specifically can address. One thing that I have noticed growing in North Dakota is that there is a unique culture in rural communities that is so much different than an urban community. And I was in Washington, D.C., like Angela said for six months, and I saw that there's, certainly there's culture in urban areas and there's a culture of an urban area, and that just made is so much more significant to me that rural communities are a culture all their own. And I think for people to recognize that they need to see both sides of the picture. And many people don't acknowledge that there is a culture of rural communities. A problem I am seeing in North Dakota as a young person is that, like I said, young people are leaving and small farms are dying. Rural communities are dying. Small farmers themselves are leaving the State. However, the demand for a product produced in rural communities, for example food, is always there. And so someone is always able to fill that supply pocket. It's just is who is filling that supply pocket. And we're seeing more and more of a trend toward an industrialization of agriculture. More corporate farms coming onto these small farms, where the small farmers were there sustaining smaller communities. And to me, that's a problem because we're loosing the entire culture, therefore, of these rural communities. Something that's been happening to reverse this trend, something I'm very proud of, to be a part of, and to envision this kind of thing, is called cooperative development. And in the mid-west I grew up around cooperatives. And it's never been -- I've never not been involving a cooperative. Cooperatives, I believe, truly are one of the only hopes for rural communities. Just an example of this, like I mentioned, my family is on a farm now and my dad was mentioning to me the other day, he said you know we actually do almost everything through a cooperative of one kind or another. There are three types of cooperatives: supply, marketing and service. And he went through all three of them saying we get all of our farm supplies -- our seed, our fertilizer, our petroleum, our diesel -- from Synex (PHONETIC), which is a mid-western located cooperative. We sell all of our products through harvest dates, through special contract co-ops such as a posse-goers squad, which I will mention many times. And we get our services, our electric services, through rural electric cooperatives. Our telephone services through rural electric telephone companies. Our water, even our drinking water comes from a cooperative. And just, this is just so significant I think for rural communities, in that urban communities are easily able to and economically efficiently able to produce things for people in an urban area because it is so concentrated. Rural America -- Excuse me for always saying America, I don't mean to do that. Rural communities have much more of a problem because people are so spaced out. And one story that I always like to tell is one that my grandpa tells me often. In the thirties, actually right now, we have a town north of us called Jamestown, which is about 25,000 people. And then there's Edgely, which at the time about 1,000 probably. And in the 30s when electricity became the fashionable way to go, some I.O.U. electric utilities decided to go into these larger cities and wire the entire city. So they went to Jamestown. They wired the entire city with electricity and they ran a single line to Edgely to wire that town, and the 100s of farmers in between didn't get electricity. Apparently it was too inconvenient. But, as well as know, electricity is something that doesn't need to be -- is not in the leadest product. So my grandpa was one of the people that went door to door to gather money so that they could pool their money together and start a cooperative to get electricity to all these farmers. And that was the first rural electric cooperative. And that's probably where my roots began.

Now, like I mentioned a couple of times already, I notice that there is a huge problem in North Dakota with young people leaving the state. They don't think -- and I see this definitely -- that there are limited opportunities for young people in our state. However, they don't realize that through cooperatives you can stay in this culture, with this culture that I've mentioned in rural communities you can stay in the area that you live, in the area that you grew up in, and the area that you love if you help yourself. And that's exactly what I think the meaning of a cooperative is. It's learning to help yourself. And through that you are able to sustain your rural community. The organization that I am involved in, North Dakota Farmers Union, has a youth program which runs every summer. And we run almost 1,000 children through a summer, I think. Almost 2,000. And I was a camp counselor for two summers, and our main objective is to teach youth about cooperatives. What a cooperative is. How to run one. Why it's begun, etc. And this can be kind of difficult because it's basically trying to teach young kids about economics. However, one thing that we have learned and one thing that we stress is that it's very possible to teach young people about cooperatives. And the people who learn about cooperatives, therefore, I think can help spread this co-op fever that we have seen in the mid-west America.

Today, please don't make fun of my fashion. There's a reason for this. If you notice, I do have a little -- this is the only formal part of me today, my little tie around my neck -- and whenever I'm wearing this I'm going to be addressing you as the facilitator, as the commentator, etc. When I take this off, however, I am going to be a camp counselor and you will all be about sixth graders, possibly seventh graders. And you'll notice, and I hope you take note of the way that I address you, the vocabulary that I use, and the manner that I ask questions or that I receive your questions. And I believe that the organization of the presentation is so much, so much important to getting a point across to young people. And I'll begin that in just a little bit. Until I've described, first of all, there are many different ways that you can teach young please about this. I have kind of structured what I call the co-op presentation, which has worked my two years on camp staff fairly well when I've addressed these 3,000 kids coming through. But there are things call cooperative games, which we are going to do a few of. There are different role playing activities you can do. And a lot of people wonder exactly, okay, how do you get the youth to come to you first, in the first place. I know that's definitely a problem. First you have to spark an interest. We, like I mentioned, have an organization with a young program part of it, and it's the largest in National Farmers Union. But other ways that I have just going to different organizations, if you start up a youth program in your organization I believe that's the only way that an organization can sustain itself and continue. And that's why I really took an interest in this topic and why I'm giving this workshop.

Now, the tie is coming off. Hopefully. Come on in campers. Everybody have a seat. We are still getting campers straying in from outside. Come on. It's air conditioned in here. Okay. Today we're going to talk about a co-op. Many people here probably don't know what a co-op is, so we're going to talk about some terms and I'm going to explain what a co-op is. And a little bit later we're going to start our very own cooperative. First of all, I need to explain. A cooperative is a business, just like any business, except for a few differences. Now, can any tell me why a business is started? Anyone? Make money, that's right, for most businesses. However, a cooperative is not started to make money. A cooperative is started because there is a need. Can everyone say that word? A need. That's right. There is a need in a community. For example. Can anyone give me an example of something that you would need in your community where you live right now? Water, that's exactly right. Any other needs that you might have in your community? Food, that's a very important need. Anything else? Work, is that what you said? There you go, that's a great one. Anything like electricity, gas. These are fantastic. We have such an active group today. That's great. All right. So the reason cooperatives are started is because there is a need. For example, pretend that you live on a farm. Hmm, that's not going to be hard for a lot of you, I suppose. You live on a farm. Now pretend that there's a big city beside you. That's probably where some of your friends live very close together because they are in a city. Now these people have electricity. Every day they get up, they get heat, they can curl their hair. They can blow dry their hair and then curl their hair, etc. You, however, on the farm were not lucky enough to get electricity. Because the people who put the electricity up didn't think that they could afford it. They didn't think it was efficient. Which means that's it's not easy to do it and they may lose some money doing it. Now, electricity which we already discussed is a need. You people on the farm, you want to look just as nice as the people in the city. You want to curl your hair. You want heat and air conditioning when you need it. So, what would you think if we would meet this need with a cooperative. Okay, I'm going to explain to you how that's possible. Another difference between a regular business and a cooperative is the people who own it. Okay, who do you think owns K-Mart. It's a multi-national corporation. That's big word. Wow, that's good. Okay, do you think there are probably one or two or three, even ten people probably making the decisions for K-Mart right now. What kind of clothes they should sell, how much they should sell those clothes for, where they should go. If you nod your head you're probably right. All right, good job. Now, if you were to start a cooperative. If you could imagine who would own the cooperative -- this is going to surprise some of you -- but the people who own the cooperative are the same people who use the cooperative. The patrons, which means the customers, of that business -- a business just like any other business except for this -- those people who use the cooperative are also the owners. So, if we go back to our electricity thing. You decide that you need electricity on your farm, mostly because you want to look pretty like everyone else. So you decide this a need, which is why a cooperative is started, so you want to start a cooperative and you need to find a lot of people to help you. All the people who join in and help you, and all the people who use this electricity are going to be the owners of this cooperative. Now, the way in which they start this cooperative is also a little bit different from a regular business. Now, pretend, and I'm going to pick on people whose names I know. Pretend that Sue lives on farm, Sue raise your hand. Where's Sue? There's Sue. Sue lives on a farm but she only has 100 monies -- monies is just going to be the international term today. Sue only has 100 monies. Nancy on the other side of the road in the pink outfit decides she also needs electricity on her farm. And she thinks, well I have 500 monies. And Sue says, you know what, I bet you if we would talk to those other farmers -- I know that there's some people over there and some people behind us -- if we would all put our money into one big pot we could probably afford, all of us together, to get this electricity. So they pool all of their money together. And because they all put in something, they're all going to be an owner of this business. The owners are going to be the people who are using it. And those people we call patrons. Member owners. The people who use it are the people who are the owners.

Now, we're going to review just a little bit because this is a lot of information for some of you, I know, except for probably the person who said multi-national because that was great. Now, starting from the beginning, tell me. A cooperative is a business just like any other business except for some very important things. Why is a cooperative started? There's a need. Why is another business started. For example, K-Mart. Why was K-Mart probably started. To make money. All right, now staying with the K-Mart. How many people do you think own K-Mart? A few, probably, I'm sorry I have not have used the word own. How many people do you think make the decisions for K-Mart? Ten, I heard the word ten, for some reason that's a nice round number. I'm not sure exactly, but I would say that there are probably about ten or less people who make the decisions. Now in a cooperative, who makes the decisions, who are the owners of that cooperative? Members, all right. Now, I'm going to back to the example once again where Sue had 100 monies and Nancy had 500 monies, and then there are other people who also put in monies and they helped start this cooperative. Now, when we're making a decision, can anyone what would be great way to make decisions. How could we go about making a decision? Vote, okay that's one way. I suppose we could all just get in one big circle and start yelling. I don't know if we could get a lot done. So, I kind of like voting, the democratic method. The democratic way. That means voting. Now, once again, if Sue put in 100 monies and Nancy puts in 500 monies, how many votes do you think Nancy should get? One? How many do you think Sue should get then? One? They sound equal. That sounds like one member, one vote. That's another thing that's very different about a cooperative from other businesses. One member, one vote, no matter how many monies you put in, no matter how little monies you put in, you still get the same number of votes as your neighbor. Because you're all owners. You're all members. Okay. Now, another thing that's a little bit different about this -- a little bit different from other businesses, is called the patronage refund. Patronage coming from the word patron, which we already talked about. What's a patron again? A member who uses the cooperative. Now at the end of the year -- now we discussed something previous to this, why is a cooperative started? There's a need. And why is another business started? To make money or a profit. Now because the cooperative is not started to make a profit, all of the leftover money that they have at the end of the year after paying all of their expenses, that money goes back to the owners. And who are the owners again? The members. So the people who use the cooperative get the leftover money. And that's called patronage refund. That's a large word and it's going to take up a lot of room on your papers, but it's a very important thing. And the money that they get back is called dividends. Okay. Now there's one other difference. This is kind of a hard topic to discuss for young people such as yourselves, but I know that you're smart, because I know one person said multi-national. So we're going to fly off of her because she seems really smart, and I'm assuming that the rest of you are as well. Okay. There's a new thing in cooperative business called value added cooperatives. Valued added cooperative. That means the people who start the cooperative are able to control every step of their product. I'm going to give you an example of this. In North Dakota, we have something called the Pasta Growers Pasta Cooperative. This came about a couple of years ago because some farmers in the area decided that when they took their grain to the market -- they are (INAUDIBLE) to the market -- they were not getting very good prices at all. They are making 2% return on their investment, or on the products that they made. And they decided this is not good. We can't live on a farm if this continues. And so they notice that there was a need, there is a need for higher prices. So they joined together in what's called a cooperative, and they decided that they were going to sell their grain through their own company. Their company was going to process it and make pasta. And there's a huge market for pasta. So they brought the grain through their own elevator. They processed it and made it into pasta. They made their own boxes, these blue boxes with the cute little farm couple on it. And they sold those in stores, and it's a huge success. This year they have learned that they are making a 30% return on their investment. They have met their need. Now, value added cooperative -- an example of that being Pasta Growers -- owns every part of the production process. So they own the field. They own the grain, the combines, the tractors, the own the processing plant where they take the grain. They own the marketing which makes the little blue boxes and sells it into stores. And they own the return. They own the money. That's value added. Now that's a little bit different from a regular business, which does the same thing, and that's called vertigly (PHONETIC) integrating. When a company vertigly integrates, it owns the entire process the whole way up. Except the significant difference is the owners. The people who own the land in a vertigly integrated corporation probably -- the people who farm the land probably do not own the land. They do not own the processing plant. They do not own the marketing, etc. They sell it like a normal farmer would to this business, and the business controls the whole thing. And the decisions in that corporation are probably made by very few people. The people who own a value added cooperative are the people who own the land. They make their entire decisions. They all vote and they all get an equal vote. And that's the difference between those two things. Are there any questions about that one, because I know that is a hard thing to understand. Great. All right. That's exciting that everyone understands that.

Now, we have gone over a couple of very important things. And some of these things are outlined in what's called the Eight Cooperative Principles. We're going to talk a little bit about the history of cooperatives. Now cooperatives were started a long time ago in the 1800s in a place called Toad Lane, England. It was started by weavers. These weaver families would go to work all day for very little pay, and they would come home at night with very little money. They were unable to afford high quality products that the people who owned their company could afford. So just because they were weavers they couldn't buy their children a quality flour or clothes or other food stuffs. So they decided that they were going to save up money, and they were going to put all their money into a big pool and start their own business so that they could go out and buy this good food and then sell it back to themselves. And that's how the first cooperative was started. It came to America in the 1900s. And then in the 1930s, when there were tough times -- tough times, of course, in the depression -- that's when cooperatives really started. In the mid-west that's when cooperative fever kind of began. And it's still going strong to this day in the mid-west. Now the basis -- these weavers long, long ago when they first began their cooperative laid down eight rules, or eight principles by which they started their cooperative. And these are called the Eight Cooperative Principles. We've talked about some of them. And I'm going to review the ones that we all know. Now, when we start a cooperative -- can anyone tell me how many votes each person gets? One. One member, one vote. That's a very important part of the cooperative principles. A second one -- can anyone tell me who can join a cooperative? Anybody, did I hear that? A producer. But pretty much anyone. For example, if Sue and Nancy again lived across the road from each other and Sue decided that she would like to start a cooperative, however, she doesn't like pink. And Nancy, you'll notice, is wearing pink today. Do you think that it would be right for Sue to say Nancy you cannot join my cooperative, I'm not going to ask you to join my cooperative that I would like to ask others to join because you wear pink. Is that right? Lots more people need to start shaking their heads. No. No, it's not. Because a cooperative principle is open membership, and that means anyone can join. Now along those same lines, there is another one called political and religious neutrality. Now that's a big one, and if anyone here can explain to me, you get a thumbs up. Can anyone explain what political neutrality means? That is so eloquent, I can't believe you're only a sixth grader. Political neutrality means you're not affiliated with any political party or movement. So if I'm a democrat or a liberal, and Sue is a conservative or in America a republican, she can't say I don't want you to be in my cooperative because of your label. I can't force you to not be in my cooperative because you have a label of a political party. And the same holds true for religion. Because you have a religious label, that does not mean that you can be exempt from joining a cooperative. Some more important cooperative principles are continuing education. Now, can anyone give me an example of continuing education? (INAUDIBLE) Thank you, sir. I think actually that's right, this is the international women in agriculture forum, but welcome and thank you for sharing your remarks. I'm just kidding. Thank you for joining us. We needed something to lighten this up, didn't we. That is an example of continuing education. Another example is what we're doing right now. This is continuing education about cooperatives. You all are being blessed with the cooperative fever spirit. And hopefully after you learn about cooperatives you can go on and tell your friends and family, and hopefully get excited about cooperatives and start using cooperatives and joining them and hopefully even starting them. That's what continuing education is about. Another one which we've discussed is patronage refund. Can anyone tell me what a patron is again? It's a member, a user, exactly. It's a customer of this. And we have discussed what a patronage refund is. It's a dividend, which means at the end of the year when there is money made, when there is leftover money, that goes back to the patrons, depending on the amount of business that they do. So the more business that someone does, the more money they are going to get back. Okay, another example, or excuse me, another principle is constant expansion. And there's an example of this. Once again, the pasta growers cooperative. They decided that they're being so successful they want to help other people do the same thing. So they are hopefully going to start another cooperative in the neighboring State of Minnesota. And that's going to be coming soon. Another example which -- there are ideas of this going around now in North Dakota -- starting a spring wheat cooperative. Now people in North Dakota decided that they're not getting enough money for their spring wheat when they sell it to elevators, so they would like to put a processing plant, much like the pasta growers did. Except they're thinking about building it in Georgia. So they are expanding into other states and hoping to spread this cooperative fever to other places. The sixth principle is to sell at cost at market price. Now that's kind of a hard one to understand. When you sell for cost at market price, that means you sell your product at the average price that everyone else is selling it. So in your community you might have a cooperative that's selling seed. You might have another business that selling seed. And the cooperative is going to try to sell you that price at the same price that the other business is selling it. Another example is the electric one that we were talking about. The reason that the businesses who lit up the big city beside you, and they didn't light you up was because it was too expensive to come to you farm and light it up. They didn't have the money to do it. They didn't want to do it. Because if that would have to do that, they would have to charge you a lot more money than they would have to charge the people in the city. So when you started up your cooperative, you were able to supply electricity to other farmers around you at about the same price, maybe even sometimes less than the people in the cities. So that's called selling at market price. Now another principle, and this is another hard one to kind of understand, and if anyone has any questions we can sure go over this. This is called limited interest paid on your investment. Now that means when at first Sue went around to all of the different houses and she said will you give money -- you weren't going to get -- in another business when you try to buy into a company you do get some money back initially, called interest. But in a cooperative you're probably not going to get as much back. And the reason is because the reason you invested in this cooperative, or the reason you gave money to this cooperative, is because you believe that this is going to help your community, your neighbors, and yourself. And so you're willing to give this money forth. And so you're going to get a little bit less interest than a person who invested in probably K-Mart. But you get the same voice as everyone else, because of that principle called one member, one vote. All right. I think I caught them all. Okay.

Next, finishing up, we're going to do one more quick review. Hopefully everyone I think has it, and I want to hear these yelled out loud when I ask you a question. Now a cooperative is like a business. It's a business just like any other business, except for some differences. Now can anyone here tell me why a cooperative is -- I keep forgetting -- why is a cooperative started? Need, that's right, I did know that. Okay. Can anyone here tell me who the owners of a cooperative are? Members, member owners, that would be a great hyphenated word. Member owners. Now who makes the decisions in a cooperative? The members. Okay now, I don't understand exactly, what if someone put in 100 monies to start to this cooperative and someone else put in 6,000 monies. Does the person who put in 6,000 monies get more votes? No, they don't. Why is that, how many votes does everyone get? One. Are they equal or something? All right, that's strange. Okay, so everyone's equal. All right. You know, I really think that we're doing a fantastically wonderful job here, and everyone really seems to have this down flat. Now we're going to go on with the concept of cooperation a little bit. Can anyone tell me what cooperation means? Working together, okay. So we've already explained how a cooperative means people working together to help themselves. They are making their own tools to help themselves and their communities. So the next thing we're going to do is to learn how to cooperate. And there are so many more of you sixth graders in here than I was expecting, but we're going to try to do this as best we can. Now you'll notice that on the floor -- and if you really feel like you can't do this, although I have confidence in each and every one of you. Anyone under the age of 90 is not exempt. And so something that we're going to now is called the cooperative games. You'll notice on the floor there are couple of taped boxes, and there's a large one out there which we're going to start at. Now the object here is to get everyone into each of the boxes. We're going to start with the large one, and we're going to move our way in to the smaller ones. And hopefully by the time we get to this little trapezoidal figure, everyone is going to be able to fit into this box. I've seen it done before ladies and gentlemen. I have full confidence in all of us. Okay, so we're going to walk outside -- and I don't know about the microphone situation. We're going to walk outside. And if you feel like just watching, please do so. If want to participate, that's great. But this is a great exercise. (PAUSE)

Welcome back everyone. For those of you who weren't out there, we just fit into the big box, we're coming into the middle sized box. Cooperate. Get close. (PAUSE) How are we doing? How do you think you're going to solve this? Vote. That's a good -- exactly. I think that we're going to have to fit into this box somehow. What do you think. No feet can be touching outside of the box. So you need at least one foot inside of the box. One, two, three. Is everyone in? Everyone's in, okay next box. Great! You've accomplished that -- (END OF SIDE 1) -- ... Maybe you might be able to get closer to the ceiling than the rest of them, if you'd like to try that. I have absolute and complete confidence in all of your abilities. And your cooperative decision making skills to decide how you are going to fit into this box. (PAUSE) Oh, look at the center of attention, quite literally. What's that? You can certainly vote to change the rules. As long it's come about through a cooperative decision making skill. As long as you cooperate in your decision making. Is everyone in? I think I see, right there. You know what, ladies and gentlemen, I think that we may have done it. I think that we very well may have done it. Oh my, let me see, let me see, let me see. Okay, we're having a little bit of problem over here, oh no. Leg up. We need -- how about if you put your legs up? I'll give it to you then if you do that. Okay, we're good, we're good, we've got it! Yeah! That was a great cooperative effort. (PAUSE) All right, it's about ten to three, and that means soon enough, please have enough patience with me, but soon enough we're going to be able to go outside and go back down to the beach. But we're almost done, don't get too anxious. Okay. Now there are many more cooperative games we can do, and if we have enough time at the end we can do another one. But this is an example of a cooperative game. And you'll notice that when you all started communicating, and when you all started to trust each other, we went from barely being able to fit into the large box to actually fitting into this tiny little trapezoid, through cooperation and through communication. Now, there are many other examples of this, and like I said, if we have enough time we'll probably do it again. But, I'm going to put back on my tie campers, so I'll see you in a little bit.

I'll still accept all immature questions and answers. Now hopefully I've made it evident that there is a direct correlation between educating young people about cooperatives and about cooperative involvement in communities. When young people get excited about cooperatives, they begin to see that there are opportunities in their communities. And instead of almost being forced to leave the state or to leave their area, as I see happening in North Dakota, these people can make their own opportunities and basically follow the guiding principle behind cooperatives, which is helping themselves. They are learning how to help themselves in a cooperative. And they are learning how to sustain rural communities in the process and to continue this rural culture, which is disappearing rapidly. Especially in my area.

Now just to end, are there any questions? Or answers? Does anyone have any questions about cooperative revitalizing? Excuse me, oh, I'm sorry, I'm sorry. But when you do have a question, if you feel comfortable, could you please come here, and if not I can just repeat the question for you. Now she takes out the shoes.

QUESTION: June Bailey from West Australia. How does this sort of cooperative compare with your new era cooperatives that seem to becoming very popular here in North America?

KS: I'm not sure if I exactly -- the cooperative that I'm teaching, do you mean? The things that I am talking about now are basic cooperative principles. And they are the underlying factors in every cooperative. In value added cooperatives, in everything. Cooperatives are organized for different reasons. They are all organized because there is a need. But they're organized to meet agricultural needs. They're organized to meet housing needs, daycare needs, schooling needs. These are used -- cooperatives can be used in any sort of format. And I hope I'm answering your question in this, but I'm going to use another example. In my town of Grand Forks, where I go to school now -- which is a big city for North Dakota -- we have almost 50,000 people. We recently had the flood of the century. Actually the flood of 500 years. And that destroyed downtown Grand Forks, which is rapidly rebuilding at an amazing rate. But one need that I see there is a need for housing for lower income people. Grand Forks has invested just a phenomenal amount of money into new housing, and they are building just a lot of new houses. But the problem that I see is that these houses are going to be too expensive for the people who actually suffered the most damage. And one thing that I would like to do while I am still in Grand Forks and school, would be to start an education program about cooperatives and about co-op housing, because I see that as a need. Was that the question that you wanted answered? Because when you say new era cooperatives, I'm not sure if I -- are you talking (INAUDIBLE) -- closed co-ops. Okay. Pasta growers cooperative is an example of a closed co-op. And that basically means that the ideal of open membership is strained a little bit. But it just means that the people who own the cooperative are the producers. So when you invest in a cooperative such a pasta growers, you have invested roughly 1,500 bushels. That's your investment. And then you are contracted to produce for this cooperative. So it's also called like a contract co-op. And the people who are contracted to grow for this cooperative are the members and they're the owners. (INAUDIBLE) Right. It still follows all the principles. The members are still the owners. You still get one member one vote. It's still started because there is a need. Right. I think there was someone, right there, you had a question.

QUESTION: I wanted to hear what it means (INAUDIBLE). I am Ingra coming from India. I did (INAUDIBLE) called aware. So, there we had the youth who has -- because the religious -- what you see here are quite different from India. Absolutely there is nothing in the religious. So people, the youth started going for studies to the state cities, but they never came back. So what we have done is, we said no they have to come back. Migration, as she rightly said, the migration has to be stopped. So what we have done is we work with the poorest of the poor that is the tribals and the (INAUDIBLE). So we they have a very rich forest producing almost (INAUDIBLE), tumeric, which has got lots of -- I mean, it's slowly doubled the price in the cities. But there they do not know how to use it, or it is sold at a very meager price. So we have formed with all the youth into a different groups, and we said that (INAUDIBLE) a middle man coming and taking all you produce and going to the cities at double the price, you youth of your own village form into cooperative and take up this job. So the youth have formed into cooperatives, a different one. One is tumeric or cashew, so on and so forth. And they take the produce and they go into the market and they keep 50% of the profits with them and share the rest of the 50% of the profit among the people who are become the members. So that is how they started doing it. So when she was saying, I was almost relating myself, like how do migrations not only start, the youth started staying in their own village and working for their own people. The third thing is that the people who did not get, or did not know the value of the tree that was in front of the house, today are earning money out of the same tree. So that is one of the things. Number two is that when they went to the market, they know that how well they came to know about other products that are there in the market. So they came to the (INAUDIBLE) how exactly, how well-finished goods they can make. So they came back to the village and there was a link between the two. So that is I think one of things that I was sharing. But then sometimes -- this is a question I give to you -- there are problems, but sometimes in some of the villages (INAUDIBLE) the cooperatives are -- there is some sort of selfishness comes in and it sometimes doesn't take off. It takes off (INAUDIBLE) and then it stagnets and it doesn't come out. So, how exactly you have come with this, faced with this problem I would like to know.

KS: First of all, I think that deserves a round of applause. That was beautiful. That just emulates everything that I believe a cooperative can do. When you were speaking about them keeping the produce for themselves and eliminating the middle-man, that's exactly what a value added cooperative does. It allows the people, the producers, to themselves by the middle-man, and to take that extra return upon themselves. And that's phenomenal that you are able to do that. And your question, the selfishness factor is certainly a factor. And my belief is that it is entirely up to the owners, to the members. They need to realize that this is certainly something that happens in the business world. People, once they have a taste of something good, they want more. An example of this, I think, is coming into cooperatives now. There are a couple of large cooperatives in our area that want to join. Synex (PHONETIC) and Harvest States. These are two agricultural cooperatives, and they are quite large. Now the discussion is that the cooperatives want to join together so that they can compete with other large corporate entities, multi-national such as ADM and Cargill, because they are not at this time able to compete. They're too small. So many of the members want these two cooperatives to join together in a joint venture so that they can compete with the large competitors. Many other people are very afraid that this is going to distance the cooperative directors even more from the members, and that the members are going to lose control. To that, all I can say is that it's entirely up to the members. The people who originally started the cooperatives are the people who have invested, and the members are the people who need to stay in control of that cooperative. If there are some people who are becoming out of hand and becoming selfish, such as you are describing, I think it is up to the other people. You can't entirely peg a lot of the blame on greed. It's a force that's going to take place. And the other people need to realize this is a cooperative and we're doing this to meet a need. We're doing this for our community. And in order to combat that greed, they're going to have to join together and either elect that person out of a powerful position or elect someone else in who really believes and fulfills the cooperatives principles. Does that answer your question? I know it's quite idealistic and it's not a structured answer, but that is completely what I believe. And I believe in that people who are in cooperatives really do want to help their communities. (AUDIENCE COMMENT INAUDIBLE). Wow.

QUESTION: (INAUDIBLE). They have begun the land (INAUDIBLE).

KS: Right. That's a very pressing issue in cooperatives today. I mean, we see that in agriculture production as well. But the alternative is, I think, so much worse. Question in the back?

QUESTION: My question is related to what you were just talking about is I have a problem with one of your principles, which is the expansion. The constant expansion. And I know in Iowa we do have sort of a different attitude toward cooperatives than you do in North Dakota because what we have seen is larger cooperatives finance smaller cooperatives, and when you talk about doing this you are losing the local control and also the local services. And we also have Synex, Land O'Lakes and those type of cooperatives who are actually just large businesses now.

KS: This is, once again, a huge discussion topic for people involved in cooperatives. I believe that the smaller something is, the most likely the better it's going to be because it is connected with its roots. But then again, on the flip side of the coin, you have to understand that these huge -- that the people that we are competing against already have swallowed up so much of the markets. Corporations such as IBP and Connager (PHONETIC) and Cargill, who process 80% of the beef in the beef packing industry, I think that's a huge problem. And if you only have one buyer, I think that -- and you have an option to have a second buyer which is another large cooperative, I would really think that it's a lesser of two evils. When large cooperatives do buy out smaller cooperatives that may not necessarily be identified with the right products or efficient, then I don't agree with that necessarily. It's a fine line to walk and it does take a lot of discussion, and I believe that the members certainly, certainly have full responsibility to make sure that their cooperative stays responsive.

QUESTION: Ann Godner, sitting on the floor, just following on. Do you think that it's possible for a cooperative or cooperatives to compete with large multi-nationals to gain their own market share? Is that a possible arrangement instead of just having one large cooperative, I mean, what you do on your farm you could have your small cooperative banding with a whole series of others and working together.

KS: I think what you may be asking is something like a regional cooperative, which is something that the Synex cooperatives -- the example I have is Synex, which has the main cooperative in Minneapolis but then it has its subsidiaries or its regional cooperatives and then it's a local cooperative. So it's almost a federated system. Is that kind of what you're speaking about?

QUESTION: If you have individual retail marketers. Shops. (INAUDIBLE).

KS: All right. I would think that would be possible and an example I can think of right off the top of my head would be something like a food co-op, which would buy organic food or which would buy things like the pasta growers co-op, pasta, and then sell that. And itself is a cooperative. Is that what you're talking about kind of? (INAUDIBLE) Right. And from the cooperative food stores that I've seen, and I know there's one in Greenbelt, Maryland, which is just a Metro stop away. I know from the cooperatives that I have been in they do tend to buy from cooperative distributors. The toothpaste is even from a cooperative. The pasta, the food, everything. So that is really interesting. And I think that it's certainly possible. And another trend that I've noticed is we are certainly becoming more industrialized and corporate farms and multi-nationals are certainly the trend. And it's a dangerous trend, and I think a lot more damage will be done before that's begun to be reversed. But I also think there's small light of consumers that are becoming more aware of where their food and their products are coming from, and they are more willing to buy cooperative products or to buy organic products. And I think hopefully before rural communities are completely dead, that more consumers will take note of that and become more active in buying more products like that. Are there any other questions?

QUESTION: I'm Noel Larry (PHONETIC) from Quinton, Australia. I've been (INAUDIBLE). I found your concept very interesting. I would really like to hear (INAUDIBLE) talk about youth forming cooperatives and I take it to mean that is to address the employment situation, I think back in Australia or in America, one of the biggest problems in rural communities would be making a living. In rural communities in Australia, most youths leave their communities for employment purposes, if they don't leave for education. Do you have any case studies that you could give us within a rural community who might form cooperatives along the lines that you've described. And also, how do they get started, is there any government assistance, grants or (INAUDIBLE).

KS: Okay. An example that I can think of right off hand is not one that is prominent in North Dakota, although there is one in North Dakota, is called Housing Coops in College Campuses. I do have quite a few friends who are active in housing cooperatives on college campuses, and it's something that I'm interested in at the University of North Dakota. Especially now that there was a flood, like I said. And they have bonded together to start their own housing, like I said, which is something they do not want to be associated for affiliated with any sort of Greek organization like a fraternity or sorority, but it's kind of in the same concept where they have a huge housing place and the students join this cooperative. They live there. They share the housing. They share the food, the kitchen area, etc., the cleaning, and they have monthly meetings to decide to make the major decisions of the household, things like that. And that's an example right off the top of my head of youth active in cooperatives. I think the cooperative fever is very prominent in North Dakota, but it is more so for production agriculture. I can't think of a lot of agriculture cooperatives begun by youth. An example, though, that I do have is one that I heard of in a tiny little town in North Dakota where the sixth grade class started a cooperative and the sell popcorn. It is, and it's beautiful.

QUESTION: (INAUDIBLE)

KS: Education, plain and simple. Farmers Union was a huge significant part of my education in cooperatives. And I went to the National Cooperative Business Association Conference a couple years ago, and that's how I found about housing cooperatives and where the interest sparked. And I think that younger people need to be taught these kinds of things in their business classes and their college business classes, things like that. Where I've taken economics and it's completely, completely ignored. It's not even considered a part of economics really. I think it definitely starts with education. You can't do anything unless you're made aware of it.

QUESTION: I'm Steve Muntz. I'm from Kentucky. I know there are some USDA cooperative specialists who will go in the United States about anywhere you want them to, to help out with cooperative formations and I think all you have to do is get in touch with them. I don't think there as good with youth as you might be, but they're good with other groups who may want to make a cooperative get going. One problem we've had in Kentucky is we've been trying to get some cooperatives going, but it just seems like the negatives is just something we have to work through over time. Getting quality products, getting farmers to come through on their agreements, and things like this is a problem that we've run into, and mainly with vegetable cooperatives that have started and gone and now we're trying to start them again. Do you have any suggestions? How do you get independent farmers to work together, any good ideas there?

KS: Wow, that's a tough one. I do know that certainly one thing that makes a rural culture so significant is the independence factor of people. And the thing about cooperatives is that when someone gets the idea to start a cooperative and it fails, they'll most likely try four or five times before completely giving up on the idea. And Northern Plains Premium Beef Processing Plant after, I think it's 5th Equity Drive, is finally getting enough support to start a feed lot and processing plants. A suggestion. I think if you find those independent producers to be as hard headed as they are independent, they'll hopefully continue to stick with it. And I think you'll -- the biggest thing you can do is probably keep having educative forums telling people exactly what this entails explaining to them that although you are not going to get an initial return on your investment, you do get ownership. You are an owner of this. You get your dividends. Essentially, you're going to get a huge return. An example of that is the Pasta Growers. An average farmer probably makes 2 to 3% return on their investment when they sell their grain to an elevator, but if someone in the Pasta Growers on their only -- I think it's their fifth year and they have paid dividends back, but this year they had a 30% return. And I think once people understand that and once they understand that they need to be resilient in this process. Hopefully they'll stick with it.

QUESTION: I'm Alison Nichols from New South Wales, Australia. I come from a town that is dying. And one of the things that we have done is we have formed an arts and crafts cooperative. The idea was that women who were suffering from drought and low commodity prices were half the people in their own right. A lot of them were sewers. A lot of them made jam. We have some people who do metal work. Some people do pottery. Some people do ceramics. We have no 43 members. We at least have a shop front which is open. And so that has, as I think some of you know when a town starts dying you lose these shop fronts, and it really does look terrible. So at least we have a shop front that is open. We have to at least provide some time in the shop. So you have give about one day a month to the shop, and you sell to the shop on commission. So really what happens is that your produce, you label it. We have one guy who does (INAUDIBLE), and they're in great demand. We have somebody else who makes coconut ice. And so the range of products in the shop is very wide. Now as yet we cannot afford to run the shop out of their own voluntary labor. But at least it has given some people a second income to assist with the drought and what have you that we've been having. And it has been quite a success, we've now been going for five years. So at least it's one way out.

KS: That's great. I think it's a very sad truth that people in rural communities have to depend on a second income and they can't depend on agriculture income. But that's -- if you can do it that way. If you can find a second income that way, that's phenomenal. Is there another question in the back?

QUESTION: (INAUDIBLE)

KS: Okay, I'll attack the last one first, because I think that is more significant in other countries than it is in America. I don't think we have that problem a lot here, but from what I see -- the women in the cooperatives that I see are the leaders, they're forefront people. I actually can't answer that one with a lot of background because I haven't seen that problem a lot. I think if you have a loud voice and carry a small stick. The reversal of Teddy Roosevelt.

QUESTION: (INAUDIBLE)

KS: If anyone else can help me with this. I don't think that there is a gender specific funding for cooperatives, but there are grants available from the USDA. There are specialists, cooperative development specialists, on the state and national level, and also available through other cooperatives. We do have someone else here who might be able to answer that more specifically.

QUESTION: I think her answer is correct. There's not specific funding available for women, but there is some funding available for feasibility studies. And that's been really important and you can get it through grants through the government, through USDA. And that's been important because people can't start the co-ops if they don't have the money to find out the need first. And just to try to answer the other question that you said about women having power with me. I am familiar with one example, and this was in India, where there is a gentleman who wanted to lend money through the government to women, and he made only the women eligible for the loans. So that if the family wanted the money, it had to be applied for from the woman. The man could help with the development of the business, but he was not eligible to get the money. And that's the way they did it there, to make sure that the women had a chance to get the money.

KS: And I think your answer may have also answered your second question, that there is some sort of funding for feasibility studies to recognize the need and to decide if it is a need in your community. Does that answer your question? Thank you. Any other questions? Thank you for coming to the microphone.

QUESTION: Shelly Hallock from Victoria, Australia. Many of your co-ops start off with very good intent, but how do you retain earnings and make capital to continue on for advancement. That's what is often the small (INAUDIBLE) return all your profits. The series starts well, and the trouble starts when they want to get bigger, grow and have capital to advance. Your comment please.

KS: I do like to promote mid-western cooperatives greatly because I think that they are a success story. But certainly there are many that die. And I think that the only answer to that is to keep trying. Like I said -- from Kentucky, right? -- to the gentleman from Kentucky. I think that the only way to keep a cooperative going is to have active members who are educated about exactly what's happening, and to keep them focused on the main goal. When cooperatives get larger and they lose that education of the people who are educated about what cooperative principles are, I think that's a great danger. And I've actually seen that in one large cooperative, which I don't think I'm going to mention. But some of the directors were at first very -- gave me a lot of grief for part of Farmers Union. And I said well I do a lot of education about cooperatives. And actually our organization started your cooperative when you were just a little cooperative, and I think that the things you are accusing me of are some of the cooperative principles. And they are actually looking to invest some California producers into their cooperative on the basis that these producers, these few producers would have the same number of votes simply because they have the same production capabilities as the other producers. And I said I don't really think that is a cooperative principle. One member one vote doesn't depend on your production. And I think if members keep that in mind, if members continue to educate themselves and to educate future members about exactly what a cooperative is and about the principles, that is the only way that a cooperative can stay strong in its own right. And for dying cooperatives and dying businesses is just, it's almost a reality and it's a sad reality. Especially when it's a cooperative that's helping a rural community. But I think the only way to keep that going is to keep spreading the word and educating other people about it. The more people who know about a cooperative, the more people who will buy and invest in it, and the more members you will have and the more active owners you will have.

QUESTION: I'm from Sascatuan in Canada, and Sascatuan is the seat of cooperatives in our country. And in fact, some of the biggest businesses in our province are cooperatives. You referred here to the opportunity of when cooperatives come together to form a big one. Federated co-op is sort of an umbrella wholesale supplier to our cooperative stores and garages in our local communities. The local community co-ops retain their influence at that level but have the buying power that's given to them by federated co-op. It's purchasing gasoline and grocery products as well. So that has been a support to the small local co-ops in the store and the garage co-ops. One of the largest co-op in Sascatuan is the Sascatuan Wheat Pool. It began as a grain company and an organization for farmers in our province. I think one of the disappointments for me today is that in order to expand and become a major player in the grains industry, it has seen fit to move into a share offering so that -- there's difficulty in reconciling whether it's a true cooperative anymore, and whether we as farmers indeed have the influence and the opportunity to have influence through that organization. Because now they are representing a corporate side, and they're still to represent farmers on the other side. So we're really grappling with that (INAUDIBLE) now and having a great difficulty with understand -- I guess we understand that in order to expand and service the farmers more, they needed more money to get into more types of operations. They're getting into hogs. They're getting into overseas marketing imports and things like that. So they are expanding and they're getting into canola crushing, and all types of livestock operations. The money through the share offering has allowed them to expand. But at the same time, this corporate interest is a worry to us as farmers. So it's an example of the largest business in Sascatuan that has kind of tried to gain for the farmers, but we're worried about are they really representing us anymore or are they representing just the true corporate side. We as farmers own the Class A shares and the share offering is all Class B shares, which says they're not voting shares. But there's a problem.

KS: Thank you for that comment. Are there any other questions or comments?