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Farmers' cooperatives
By P.R. Sarkar
Prout advocates the reorganization of all agricultural land according to
a phase-wise plan. In the first phase all uneconomic landholdings should
be taken over by cooperative management for the benefit of both those
who previously owned the land and agricultural laborers who work in the
cooperative. In the second phase all landowners should be requested to
join the cooperative system. In the third phase there should be rational
distribution of land and redetermination of ownership. Finally, in the
fourth phase there will be no conflict over the ownership of land.
People will learn to think for the collective welfare rather than for
petty self- interest. This psychic expansion will create a more
congenial social environment. However, such a change in the collective
psychology will not come overnight, but will occur gradually according
to the sentiment of the people.
When such a system has been introduced the present conflict among
landowners and landless rural workers will no longer exist. In the
initial stage agricultural cooperatives will be formed with the mutual
cooperation of groups of farmers. Suppose A, B, C and D are four farmers
who have consolidated their land into a cooperative in the following
proportions:
A: 2 acres
B: 5 acres
C: 10 acres
D: 15 acres
The profits from the sale of their crops should be shared in proportion
to the amount of land each gave to the cooperative, and the service each
rendered for the production of these crops. Farmers will receive produce
and profits according to the number of their shares in the cooperative
and their labor. As the yield of land increases due to the continuous
development of improved scientific techniques, farmers can expect
increased productivity and greater prosperity. A record should be kept
of the productive capacity of all the land included in the cooperative.
Shares should be allocated on the basis of this productivity. For
example, if a farmer has thirty acres of land of which fifteen acres are
highly productive and fifteen acres are of low productivity, then his or
her shares should take into account the differences in productivity. If
some landowners do not want to work in an agricultural cooperative their
land should still be included in the cooperative. They should also be
considered as cooperative members and should get shares based on the
size and productivity of their land. Of course, landowners who do not
work in the cooperative will not be entitled to wages.
In the cooperative system farmers need not sell their produce
immediately after harvesting due to pressure of circumstances. In the
individualistic or private enterprise system, most farmers have to sell
their produce immediately in order to get sufficient money to survive.
But in the cooperative system farmers will enjoy more financial security
as the cooperative can advance money to individual farmers and sell the
crops at the most favorable time for the best price. That is, the
cooperative can determine how much to sell and when to sell in order to
get the best profit. Cooperatives will also be able to fix the price of
their own produce within certain price limits. Thus, cooperatives will
get the profit, which is taken by middlemen and profiteers in the
individualistic or capitalistic system.
In the present system after the harvest poor farmers have to pay off the
loans they took for such things as irrigation, seeds and labor to
produce their crops. In addition, they often purchase clothing for their
families for the following year. Due to their urgent need for money they
are frequently forced to sell their harvest at virtually give away
prices. This type of sale under the pressure of circumstances is called
a “distress sale”. To protect the farmers from distress sales, the
cooperative system is essential. In a cooperative, farmers will keep the
necessary quantity of farm produce to meet their food needs for a year
and will sell the excess produce to the cooperative at the rate fixed by
the cooperative. When the market price is reasonable, the cooperative
will sell the produce. The farmers will then receive their percentage of
the profit, which will be proportional to the amount of their land
shareholding in the cooperative. Taxes, levies, excise duties, etc.,
should be collectively paid by the cooperative, thus freeing individual
farmers from financial pressure and economic exploitation. In many
economically developed countries, there are no land taxes because the
revenue collected from such taxes is only a very small part of the total
revenue. The workforce in the cooperative system will be composed of the
shareholding farmers and non-shareholding laborers. Both groups will
benefit: the shareholding farmers will get regular salaries for their
work plus a return on their shares, while the laborers will enjoy stable
employment and favorable wages.
There are two types of non-shareholding laborers working in agricultural
cooperatives -- those who are permanent laborers and those who are
casual or contract laborers. The permanent laborers will get bonuses as
incentives besides their wages, while casual laborers will only get
wages for their labor. Those laborers who give the greatest service to
the cooperative should get the greatest bonuses. Skilled workers should
get paid more than unskilled workers. This will be an incentive for all
to become skilled laborers and to work harder. Bonuses should be paid
according to the amount of wages, which should reflect both the skill,
and productivity of the laborer. Members who purchase shares in the
cooperative should have no power or right to transfer their shares
without the permission of the cooperative, but their shares may be
inherited. If some cooperative members have no descendants, then their
shares should pass on to their legally authorized successors who will
become members of the cooperative if they are not already members. The
reason for this policy is that it prevents capitalists from purchasing
large numbers of shares in a cooperative and speculating in the market
place. This type of economic activity can easily lead to a depression.
In different countries there are different systems of inheritance, so
the right of inheritance should be decided according to the system in
vogue in a particular country. For example, in Bengal the Da'yabha'ga
system is followed, in other places in India the Hindu Code is the
established system, while in other countries other systems are practiced.
If this arrangement is followed, cooperative members will not need to go
to court or get involved in litigation as the zamindars of the past used
to do. As all members of the cooperative will be from the same vicinity
or members of the same village, they will all know each other, and thus
there will be little difficulty in deciding who should be the legally
appointed recipient of the shares. The members of the cooperative
themselves will be able to decide who can claim the right of inheritance
to the shares owned by the deceased members. Disadvantaged or minor
landowners will also benefit in the cooperative system. A widow, a
disabled farmer, or a minor boy or girl who owns some land will derive
an income from the land based on the number of shares in the cooperative.
In the system of private ownership their land would have remained
unutilized, and they would have remained poor. Therefore, even if
cooperative members are unable to do any work, they will still be
entitled to an income from the total profit of the cooperative.
Farmers may also create producers cooperatives to produce items for
various industries. Thus, some farmers’ cooperatives may function as
both farmers’ and producers’ cooperatives. Raw materials, which are of
non-farming origin, such as limestone for the production of cement,
should be processed by producers’ cooperatives. Cooperatives, which are
only agricultural, should sell their produce directly to the producers’
cooperative which in turn can manufacture a variety of consumer goods.
Farmers’ cooperatives, which also function as producers’ cooperatives
can, increase their profitability in various ways. For example, such
cooperatives could produce oil from rice husks. The money earned may be
reallocated and reinvested in the farmers-cum-producers cooperative or
used for research and development.
Farmers in agricultural cooperatives will be able to exert collective
pressure on the local, state or federal governments for different
benefits and facilities. For example, in India individual farmers who
grow fruit normally use deep well irrigation. But this can adversely
affect fruit production because if the water-table drops too far below
the roots, the fruit trees will gradually wither and die. In such
circumstances shallow tube wells are better, but these wells cannot
supply sufficient water for irrigation. Farmers need ponds, barrages and
lift and shift irrigation facilities, and for these things they may need
government assistance. It is the cardinal right of the people to be
guaranteed the minimum requirements of food, clothing, housing,
education and medical treatment. The proper supply of irrigation water
is also a cardinal right, because without water, food, which is the most
important of the minimum requirements, cannot be produced. Irrigation
water is like the apex of a spinning top -- without it the top cannot
spin.
18 February 1988, Calcutta
Prout in a nutshell 14
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Providing food, clothing, housing, education and medical treatment is
most important for social security. These five minimum requirements are
indispensable to raise the living standard of the people. To guarantee
these, the principle of production based on consumption has to be
adopted. Special emphasis should be placed on agricultural production
because the provision of food is of vital importance, and for this the
cooperative system should be rapidly expanded. According to Prout, too
many people should not be engaged in agriculture. Rather, a major part
of the population should depend on industry. Not more than thirty to
forty-five percent of the population should be employed in the
agricultural sector.
Land is usually divided into economic holdings and uneconomic holdings,
according to productivity. Economic holdings are those where the market
price of the produce will exceed the cost of production including
capital, labor and machinery. Lands, which produce economically viable
agricultural wealth -- that is, where output exceeds input -- are called
“economic holdings”. Uneconomic holdings are those where the market
price of the produce is less than the cost of production after including
the costs of all the inputs. As uneconomic holdings are not profitable,
the landowners usually refrain from producing any crops. In the rural
economy of a country such as India, if a village is accepted as a
production unit, then there may be many plots of land in a village,
which are not used for producing crops because they are uneconomical.
While implementing Prout, the question of agrarian revolution will
automatically arise.
As I have already said, agricultural land should be brought under
cooperative management, but the cooperative system should be introduced
in two stages. In the first phase of the socialization of land, Prout
will not raise the demand for land ceilings, but the sale of
agricultural land will be prohibited and uneconomic landholdings will be
brought under cooperative management. The responsibility for cultivating
this land will not lie with the landowners but with the cooperatives
under the aegis of the immediate government, and with its assistance.
The landowners of the uneconomic landholdings in each village will
become the members of the cooperatives in this phase. Thus, cooperatives
will only consist of those who merged their land together to make
uneconomic landholdings economic. The landowners will give their land,
and in this phase they will remain the owners of the land. In cases
where the landowners employ labor for cultivation, fifty percent of the
net profit will go to the landowners and fifty percent to the laborers
who work in the cooperatives. In this phase, the rivers and streams in a
village should be harnessed for the collective welfare. For instance, by
constructing embankments and small dams on the rivers, large-scale
irrigation, electricity generation, and industries based on local needs
should be established. The first steps must also be taken to alleviate
the population pressure on land. An increasing percent of the rural
population will have to be employed in industry by establishing
agrico-industries and agro-industries. There should be provision for the
preservation of crops by building stores and cold stores under the
control of local administrative boards. The cooperatives should be
supplied with tractors, manure, seeds, water pumps and other farming
equipment through producers’ cooperatives. Consumers’ cooperatives will
supply the commodities necessary for daily consumption to the rural
population.
In the very first phase of establishing cooperatives, agricultural
laborers, landless laborers, day laborers and sharecroppers will come
within the scope of cooperatives. From this phase, the education system
in rural areas should be thoroughly reformed. To arouse the cooperative
spirit among the people, there should be extensive training and
education, but moral education must take precedence over everything else
so that people do not give greater importance to individual interests at
the expense of the collective interest. In the second phase of
implementing agricultural cooperatives, the economic holdings of the
landowners should be brought under cooperative management. Only after
all the uneconomic holdings in a village are brought within the scope of
cooperatives should the economic holdings be brought under cooperative
management. In this phase it will be easy to apply science and
technology extensively in agriculture, increasing the amount of
production.
In this second phase, all should be encouraged to join the cooperative
system. The net profit will be increased in favor of the laborers
working in the cooperatives so that twenty-five percent of the net
profit will go to the landowners and seventy-five percent to the
laborers. Here laborers means those who employ either their physical or
psychic labor in the cooperative. The landowners will benefit in two
ways. First, as landowners, they will get twenty-five percent of the net
profit of the produce from the land, and secondly, if they are part of
the cooperative labor force, they will be entitled to a portion of the
seventy-five percent of the profit distributed among the cooperative
members.
In this phase, there must be emphasis on the rapid and large- scale
establishment of agrico-industries and agro-industries so that the rural
population will be dependent more on industry than on agriculture. With
the development of such industries, there should be simultaneous
emphasis on educational and cultural reforms to further develop the
cooperative mentality of the rural population. From this second phase,
production for consumption will increase the standard of living of the
rural population, and the basic criteria of social security -- that is,
the minimum requirements of life -- must be arranged for the people.
In the third phase, there should be rational distribution of land and
redetermination of ownership. The rational distribution of land will
depend on two factors -- the minimum holding of land necessary to
maintain a family, and the capacity of the farmer to utilize the land.
In this phase, the landowners will not be able to employ individual
laborers, landless laborers or sharecroppers for the cultivation of
land, so it will be more beneficial for them to participate fully in the
cooperative system.
In this phase, it will be easy to establish big cooperatives with the
extensive application of science, but these cooperatives will not be
anything like the huge collective farms of the Soviet Union or China. If
cooperatives are allowed to become extremely large, it will be difficult
to utilize natural resources efficiently and this will lead to
complications in the sphere of production. One of the main defects of
the collective farms in socialist countries is their unmanageable size.
In Prout, the farmers’ cooperatives themselves will determine the size
of the cooperatives. But while building up the cooperative system, two
factors should be kept in mind -- first, the high quantity and quality
of production should be ensured through the application of science and
technology while keeping production costs at a minimum; and secondly,
the cooperative members must be encouraged to attain maximum psychic and
spiritual development at their highest level in exchange for their
minimum physical labor. In the third phase of implementing the
cooperative system, one hundred percent of the net profit will be
distributed among the cooperative members. The former landowners will
identify fully with the cooperatives in this phase.
Through these three phases it will be possible to reduce the excessive
population pressure on land and to engage thirty to forty-five percent
of the population in agriculture. In the second phase, the problem of
unemployment will be tackled through the large-scale establishment of
industry, and by the third phase there will be no unemployment problems
for the agricultural laborers. By the end of the third phase, the rural
sector will be freed from the vexing problems of agricultural and
industrial production, unemployment and social security. In the fourth
phase of implementing the cooperative system, there will be no conflict
over the ownership of land. The agrarian problems of every village will
be solved. All the social security arrangements concerned with food,
clothing, housing, education and medical treatment will be easily
provided to the people. In this phase it will be possible to make the
maximum utilization of the collective physical, psychic and spiritual
wealth of every village. For the total implementation of the cooperative
system, there must be proper psychic preparation through internal urge
and external pressure, adjusting with the time factor, because people
will never accept a system that is forcibly imposed on them. Such a
change in the collective psychology will not occur overnight, but will
depend on the sentiment of the people. The time period from the first
phase to the fourth phase of the implementation of the cooperative
system can be called the transitional period for the implementation of
Prout.
February 1982, Calcutta
Prout in a nutshell 20
Copyright Ananda Marga Publications 2003
Published with permission
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