The Co-op as an Alternative to "Take a Leak" Economics

What if the Hanover Consumer Cooperative Society decided that, as a result of the Co-op’s existence, the Upper Valley will have an economy that maximizes local ownership and minimizes the leakage of income, wealth and jobs to other places?

And what if, as a result of that decision, the Upper Valley became a zone of economic self-determination, no longer a place whose success comes largely at the whim of people and institutions who have no interest whatsoever in guaranteeing that our community continues to thrive?

Those are the questions I have, following this year’s Annual Meeting of our Co-op on April 27 and the business leaders’ breakfast the Co-op co-hosted (along with Vital Communities and Local First Vermont) the following morning. Both events featured talks by Michael Shuman, author of The Small Mart Revolution: How Local Businesses are Beating the Global Competition.

Shuman, co-founder of the Business Alliance for Local Living Economies (BALLE), of which the Upper Valley sorely needs a chapter, talks about a public policy struggle between TINA and LOIS. “TINA” is an acronym for “there is no alternative” to surrendering to race-to-the-bottom globalization. “LOIS” stands for economic enterprises that are “locally owned” and “import substituting.”

During his visit to Hanover, Shuman urged his audiences to conduct a comprehensive assessment of the Upper Valley’s economic “leakage.” This involves taking stock of how much wealth is leaching out of our community in the form of dollars exported to businesses owned in other places – when that wealth could just as easily stay here, if only we created business activity that could keep it here.

Shuman also offered up a few wild ideas for the Co-op to consider. What if Centerra Marketplace became the Cooperative Marketplace – a retail destination owned by the Co-op and singularly dedicated to providing the people of the Upper Valley with goods and services that come from the Upper Valley? What if the Co-op partnered with a local credit union to offer an Upper Valley Credit Card – one that was not exporting usorious interest rates and draconian charges to banking monoliths elsewhere on the planet? What if the Co-op led an effort to reform applicable securities laws, eliminating the huge hurdles placed in the way of people investing their resources locally?

What if the Co-op, in concert with other wealth centers in our community, had the institutional wherewithal to buy out local businesses when their owners found it necessary to cash out? If you think that isn’t important, then maybe you still think that Ben & Jerry’s, and Stonyfield Farm, both founded by local economic visionaries, remain locally owned businesses today. Their foreign owners (Uniliver and Group Danone, respectively) can testify otherwise.

Our Co-op is already moving forward with one important initiative. Through our alliance with other food co-ops in the region – CVNC (which currently stands, somewhat misleadingly, for Connecticut Valley Neighboring Co-ops, but which involves co-ops from throughout Vermont, New Hampshire and western Massachusetts) – we’re commissioning economist Doug Hoffer to assess the potential for cooperative business enterprise in the region as an alternative to ceding economic hegemony to “big box” retailers.

As Shuman notes in The Small Mart Revolution, Hoffer performed a similar analysis of the Vermont economy in 2000 for Vermont’s Living Wage Campaign. His Vermont economic leakage study found that, however enduring the image is of a Green Mountain State that is as much about cows and agriculture as anything else, the state was importing food at the rate of $2 billion a year. He also pinpointed $1 billion a year in energy imports – and this was when a barrel of oil cost a quarter of what it does today – and $250 million in credit card interest payments. (Yes, I am obsessed with credit cards and their parasitic role in the lives of Co-op members and other consumers.)

The Hoffer study, and other compelling evidence that Shuman is spot-on notwithstanding, the Valley News carried a somewhat skeptical account of Shuman’s talk at the business leaders’ breakfast. Several attendees quoted by the newspaper seemed to think that the Upper Valley is already insulated from the effects of TINA economics because our economy is dominated by two huge local institutions: Dartmouth College and its affiliated healthcare giant Dartmouth Hitchcock Medical Center.

Nobody would argue that the Upper Valley is not fortunate to have Dartmouth and DHMC. But neither organization has as its mission the strengthening of the local economy. Dartmouth is governed by a board that is dominated by folks who do not live in the Upper Valley, including a vocal insurgency of alumni with an overtly political agenda that seems at sharp variance with the prevailing local preferences. DHMC is in the process of busting up the Hitchcock Alliance, created to nurture the area’s community hospitals, apparently because such nurturance is not consistent with DHMC’s own business needs.

The point is not to condemn Dartmouth or DHMC; each is a great institution and the Co-op could not thrive without them. Rather, the imperative is to take advantage of whatever economic strength these institutions add to the Upper Valley so as to assure that the people of the Upper Valley control their economic destiny. That resonates profoundly with the Cooperative Principles and would, should the Co-op seek to drive such efforts, do great honor to the people who built our organization into such an important institution in its own right.

NOTE: The above dispatch has been posted, minus the photograph and with a somewhat less racy headline, to the discussion forum of the Hanover Consumer Cooperative Society. Check it out -- and consider posting a response there! Unfortunately the Co-op has not yet figured out how to make the forum anything other than essentially invisible.

Let's Hear It for Jim Kenyon!

Jim Kenyon does not write about the Hanover Consumer Cooperative Society very often in his Valley News humor column, since he is usually chortling about the region's Keystone Cops and their relentless pursuit of angelic, exam-cramming teenagers. But the Co-op is fortunate that, every year or so, Kenyon offers up the literary equivalent of slipping on a banana peel in the produce department.

This year's effort, usefully timed right between April Fool's Day and the Co-op's annual meeting on April 27, concerns the Co-op Community Market on Lyme Road in Hanover.

The Community Market is presently closed so that the Co-op can replace it with the first entirely new building the organization has commissioned since the early 1960s. (The Lebanon Co-op Food Store, opened in 1997, is leased from the real estate division of Dartmouth College.) Gone will be the miserable, ugly little former gas station on the site -- to be replaced by a much bigger facility designed by Hanover's UK Architects in association with award-winning grocery store designer James Wasser AIA.

Thanks to the enlightened site planning of Bob White and his colleagues at ORW Landscape Architects and Planners, the new Cooperative Community Market will anchor the emerging Dresden Village district, standing as it does at the traffic circle marking the southern portal of what town planners hope will be, in essence, a second downtown for Hanover. The building does not simply employ "green design" principles -- it will prove that energy efficiency can, and should be, beautiful.

In short, the new Co-op Community Market will be a great setting for the Co-op to do what it does best -- sell excellent groceries while delivering responsive, principled and friendly customer service, in the context of the trustworthy business relationship that arises out of being a merchant that is owned by its customers. And, because the new store, although still small, will be closer to a full-service grocery facility than what was there before, it will have the salutary benefit of relieving some of the pressure on the Co-op's maxed-out flagship establishment a couple of miles to the south.

Hanover, teeming as it is by the miserable wretches who people Jim Kenyon's columns, doesn't deserve all this excellence, according to the Valley News columnist. His complaint is that the Co-op has actually chosen to cooperate with, rather than thwart, the Town's vision for Dresden Village, which Kenyon ridicules as a scheme to turn Lyme Road into "Les Avenue [sic] des Champs-Connecticut."

He prefers a Co-op that is committed to a "cramped and grungy" and therefore "un-Hanoverish" facility that reminds him of a bygone era when he could gas up his Thunderbird for 27 cents a gallon. It was a time when nobody gave a damn about who put what where and town planning meant wondering which side of the Route 12A shopping strip should get the Burger King . . . a time when it wasn't so danged hard to pass the exams at Hanover High School because the local professorate packed its offspring off to St. Paul's or Philips Exeter rather than condescend to the use of free public education.

But I digress. Kenyon is peeved because the Co-op will no longer be selling gasoline at the Lyme Road store. So he lurks at the site, staring nostalgically at the shuttered and soon-to-be demolished concrete bunker, waiting until some hapless soul who hasn't heard about the closing shows up to get gas. When he finally finds his mark, she's too busy to talk to him -- but her failure to serve up a kvetchy quote or two does not deter Kenyon from using the encounter to advance his story. He simply blames the Co-op for that as well (because it caused her to rush off to find gas elsewhere -- likely at the gas station the Co-op isn't closing, two miles away.)

Then Kenyon pursues his quest by asking a couple of local businessfolk for a suitable quote or two, but neither of those fellows oblige him either. One, the owner of a filling station in Lyme, refuses Kenyon's invitation to salivate over the prospect of inheriting gasoline business from the Co-op. The other, identified as someone who "owns a fair amount of retail and office space in town," and thus presumably has no special knowledge to contribute to a discussion of how to run a successful grocery store, nevertheless proclaims that the Co-op is "digging [itself] into a corner" by "putting a grocery store into a convenience store location." Note that the guy doesn't exactly announce that he is going to step into the breach and open a gas station along Route 10 that will serve all of the newly pent-up petro-demand.

According to Jim Kenyon, the Co-op should indulge his bizarre preferences and stick with a recipe for ongoing mediocrity at Lyme Road because the Co-op is a "nonprofit organization." That's "nonprofit organization" as opposed to the "mega supermarket chains" where "the bottom line is . . . always the bottom line."

Here's where the humor column stops being funny.

In fact, a consumer cooperative society is not a nonprofit organization -- it's a business, facing the same competitive pressures and marketplace realities as any other grocery or gasoline retailer. The difference is that at a consumer cooperative society, the customers own the place -- and so the profit, whether tangible or intangible, stays in the community. It is not exported to distant shareholders whose only reason for owning the stock is to get rich.

Yes, the board and management of the Co-op could squander the legacy that thousands and thousands of members have built up over 72 years, justifying such profligacy by proclaiming the organization too noble to break even. Yes, the Co-op could make business decisions only when there is no possibility of disappointing anyone. Yes, the Co-op could embrace Jim Kenyon's vision for the Upper Valley as a place that looks and thinks no differently than it did a half century ago -- a time when, come to think of it, daily newspapers like Kenyon's employer were not swirling toward oblivion because their idea of innovation is wrapping papers for delivery on rainy days in two plastic bags instead of one.

If that's the kind of thinking Jim Kenyon wants to see at the Hanover Consumer Cooperative Society, he should seek election to its Board of Directors. He certainly has enough name recognition to prevail in next year's election. And you don't have to pass an exam.

Great Strides . . . Toward Drug Company Profits?

If you looked up the word "virtuous" in my dictionary, or that of any parent of a little kid with cystic fibrosis, you would find a picture of Dr. Robert Beall, president of the CF Foundation. He has a reputation, among everyone connected with CF, as savvy and indefatigable, obsessively dedicated to overcoming the disease. During the 13 years he has led the Foundation, CF has gone from being an incurable scourge that killed most people in childhood to a disease that is on its way to being cured. The median predicted survival age is now 37 years, and growing.

A hallmark of Beall's tenure at the helm of the Foundation has been its Therapeutics Development Program. According to Business Week magazine, the CF Foundation has paid drug companies $175 million, and counting, to work on developing new treatments for CF and its symptoms. In recent weeks the program has received a wave of publicity because one such CF Foundation-supported drug company, Vertex Pharmaceuticals, may have a winner on its hands. Specifically, for the first time, there is at least preliminary evidence of a drug that could, in at least some patients, fix the biochemical cell-wall defect that causes CF.

There is a dark cloud that goes with this silver lining, however. The CF Foundation is a big, mainstream charity that was started by CF families but which relies in no small part on the public at large -- hundreds of thousands of people who have no direct connection to the disease, do not automatically view Bob Beall as the visionary he truly is, are familiar with the scandals that have plagued other mainstream charities, and, most importantly, might be inclined to think that drug companies are faceless and greedy corporate behemoths bent on extracting windfall profits from sick people.

These people don't automatically think it's a great idea that the CF Foundation is taking their donations and turning them over to venture capitalists whose ultimate purpose is to get richer. I know this because, as a leader of Team Rose 66, I'm getting ready to take part in the Foundation's annual Great Strides fundraising walk on May 17 -- and the people I am asking for money are asking me some tough questions in return.

Here's the heart of the explanation of the program that appears on the CF Foundation's web site:

Current estimates suggest that it costs more than $800 million to move a drug from its concept stage to the market place. There is a critical need to help provide support to pharmaceutical and biotechnology companies that conduct drug discovery and early-stage clinical evaluation studies in small population diseases such as CF. Even with incentives, such as the Orphan Drug Tax Credit (that encourages investment in orphan diseases like CF, which affect patient populations of less than 200,000), the fact remains that pharmaceutical companies must first secure the financial resources to invest in these diseases.

Further, with increasing demands being placed on pharmaceutical and biotechnology companies, especially the small “start-ups,” investors are often hesitant about making major capital investments for orphan disease-classified drugs. The Therapeutics Development Program attracts researchers to the CF drug development process and shows a level of commitment unrivaled by any other voluntary health organization.

Fair enough. I'm delighted to be able to tell the donors to Team Rose 66 that the Therapeutics Development Program is a fundamental reason my daughter is likely to die, in old age, of something other than CF. But this allides certain ethical questions, ones that are at the core of the fundamental flaws in our health care system. Among them:

1. In a market economy that relies on investor-owned businesses to produce medical innovations, super-high returns on investment are supposed to compensate venture capitalists for the ultra-high risks of trying to develop new drugs. That's why so many prescription medications, including ones my daughter uses like Pulmozyme and Tobi, are so expensive. If those big bucks are inadequate -- which is the premise of the Therapeutics Development Program -- then, for the purpose of curing disease, shouldn't we consider alternatives to venture capitalism instead of propping it up?

2. If the problem is that CF is an "orphan" disease -- i.e., one with too few patients to make curing the disease profitable -- then isn't the Therapeutics Development Program just a mechanism for diverting societal resources away from curing truly widespread ailments in favor of working on a condition whose relatively small cohort of patients happens to be more wealthy and empowered than others?

"I favor all efforts to give people like Rose and those with similar diseases a better shot at a long, healthy life, and I understand that sometimes creative approaches and strange bedfellows are part of the process," said the friend who first raised concerns about the Therapeutics Development Program to my attention. "I just don't want to see the drug companies profit unduly."

It would help if the Cystic Fibrosis Foundation could offer the public reassurance that such undue profits are not where their donations to the Great Strides are ending up.

Architecture Enthusiasts Storm Manchester

How oppressed we all are by the bad buildings all around us! So it is hardly surprising that, when given half a chance, we storm the Bastille by the thousands to express our outrage and show the authorities that we demand architecture that honors rather than demeans us.

“We” in this instance are the good people of Manchester, New Hampshire and environs. And “storm the Bastille” is, perhaps, a slightly exaggerated way of describing the behavior of the hoards that took advantage of the free admission to check out the newly expanded Currier Museum of Art during its opening week.

In they streamed – the art mavens in their pearls and bow ties, the developmentally disabled in their wheelchairs, the old, the young, the in-between, the bored and the curious. They saw what $21.4 million buys, in the form of a sleek addition of glass, terra cotta and metal that adds 33,000 square feet to what is now a museum of nearly 90,000 square feet.

They checked out the New Hampshire variation on a well-established, coast-to-coast cultural trend of cities ‘starchitects’ to build dazzling art museums as a means of making the municipality a true cultural destination. Denver has its brand new, jagged and ragged (and much maligned) gallery by Daniel Libeskind. Steven Holl (famous in these parts for creating a dorm at MIT that is both visually and conceptually a giant sponge) designed a luminescent art museum addition in Kansas City. Even East Lansing, Michigan – a town presently dominated by a campus consisting of a vast athletic complex and a few academic out-buildings – is getting into the act, having lured Zaha Hadid to bring her other-worldly design sensibility to an art museum for the university in question.

Is the Currier addition truly starchitecture? Well, yes and no.

The design is by Ann Beha Architects of Boston. Beha is in the second tier of the celestial hierarchy – not quite a Libeskind or Hadid, but an architect with a national practice whose recent New Britain Museum of American Art in Connecticut earned much critical acclaim last year. Indeed, when you have a firm that you name after yourself, you’ve embraced starchitecture.

However Beha herself was not on her firm’s project team for the Currier. Pamela Hawkes, another principal in the firm, led the project, working with her colleague Scott Aquilina. He considers Beha a starchitect, as he recently told New Hampshire Public Radio.

More importantly, the Currier addition doesn’t resemble a piece of sculpture, in the fashion of Frank Gehry’s titanium-clad, blob-like Guggenheim in Bilbao, Spain, which is credited with launching the current museum building craze in the U.S. The Manchester design is restrained to a fault, yielding to a Bilbao backlash that insists the building not upstage the art.

Thus we have the project’s only truly disappointing feature. The Currier used to have an entrance; now it just has a door, in the middle of a glass curtain wall obviously intended to defer, or even hide behind, a gi-normous, bold, newly acquired sculpture by Mark diSuvero, called “Origins.”

Behind “Origins,” the museum’s original, 1929 building, designed to resemble an Italian Renaissance palazzo, has now been all but swallowed by the current addition and a prior one, added in 1984 and designed by 1980s starchitect Hugh Hardy. The museum’s original, south-facing, grand entrance, with a pair of Ionic columns and captivating mosaics that literally embraced visitors, is now on display in the new ‘winter garden’ that is the heart of the addition.

The result is an ironic commentary on the state of museum architecture today. While the contemporary building strives for invisibility in deference to the collection on display, the museum’s original design is now part of the art collection, having fully relinquished its role as actual architecture. One of these days, we will recapture the idea that a building can be both art and architecture – at the same time!

If this annoys you when you visit, seek relief by relieving yourself. Walk from the winter garden downstairs to the lower level and visit the bathrooms, then look down. Concrete artist Thomas Schultz, whose sensitive approach to color adds warmth and dignity to the floor of the lobby and winter garden spaces, was instructed to go wild on the lower level. The wildness reaches its apotheosis in the bathrooms and just outside them, where he has whimsically and colorfully blown up and reproduced bits of the 1929 mosaics from upstairs.

Nearby are the museum’s new offices, amply and pleasantly opened to sunlight via a continuous band of wide clerestory windows. Most contemporary art museums either accord staff a kind of high priesthood by giving offices a penthouse view (see, e.g., Yoshio Taniguchi’s Museum of Modern Art in Manhattan) or, worse, reduce them to insignificant moles by placing them in a sub-basement (as at the otherwise spectacular American Museum of Folk Art by Tod Williams and Billie Tsien, right next door to the MoMA). The Currier gets it just right re the employees: From the outside, the continuous band of glass at the base of the addition testifies that the museum is supported and held up by the folks who work there.

These details, tangential to the process of actually displaying art, are what prove the crucial difference between a building that cares about its users and one that is indifferent to them. Everybody goes to the bathroom at the museum. If the Staff is poorly treated, the museum suffers.

That the Currier, and its architects, gave a damn about these things is what makes the new museum worth visiting as a building. Yes, the Currier has a wonderful collection that should be savored by all. But we live in an era when the public sphere has shriveled like neglected fruit, so averse have we become to investing in facilities we own as a community. An exception to that trend requires celebration.

Within the warm but expansive and sunny confines of the Currier’s winter garden, there will be parties and gatherings, pleasant snacking and even, perhaps, romantic assignations, all while the wretched New England winter rages outside. It is, I think, those possibilities that the opening week crowds were really celebrating. The art made a fine backdrop for such festivities.


p.s. It would be irresponsible to write about the Currier Museum and architecture without noting that the biggest object in the collection of the Museum is the Zimmerman House by Frank Lloyd Wright. Tours of the Zimmerman House depart from the Currier (to keep crowds from clogging the streets in the house's quiet neighborhood). The hassle is worth it.