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Rural electric cooperatives have a history dating back to Franklin Delano Roosevelt and the New Deal. Congressional action fueled by federal loans and grants enabled membership cooperatives to connect the “last mile” and bring electricity to almost all of rural American within the early years of their organization. The goals and principles of the cooperatives were idealistic, high-minded, and membership-based.
More than 75 years later, rural electric cooperatives in many areas where they operate are often a significant economic presence and employer with assets and sales throughout the South of billions dollars annually. The U.S. Department of Agriculture … sees the cooperatives as primary intermediaries for economic development and social services, and continues to invest loans and grants in the cooperatives accordingly as a fundamental component of the U.S. policy and program for rural Americans.
A look at the cooperatives today in the 12-state region of the South offers another picture entirely. There is too much evidence of democracy lost and discrimination found. Transparency is rare and too many rules and procedures are designed to maintain a status quo that seems more frozen in the 1950s before the advent of the civil rights and women’s rights’ movements in the South and nationally, than equipped to fairly service and deliver progress to all members of the cooperatives equitably.
The Rural Power Project, a joint project of Labor Neighbor Research and Training Center and ACORN International, examined all available records on all 313 cooperatives in the South. The project found that of the 3,051 supposedly democratically elected board members, 2,754 are men or 90.3% while 297 members are women or 9.7%. This figure is in spite of the fact that the gender distribution in South is 48.9% men and 51.1% women. Examining participation by African-Americans in the governing process of the cooperatives where information was available and verifiable, we found that 1,946 of the members were white or 95.3% throughout the South, while only 90 or 4.4% of the members were black. Of the more than 2,000 governing positions for which we had information, only six were Hispanic or 0.3% of the total. These figures compare to the fact that throughout the 12 Southern states, only 69.23% are white, while 22.32% are black, and 10.19% identify as Hispanic.
Half of the states (Arkansas, Florida, Kentucky, Louisiana, Mississippi, and Tennessee) had three or fewer African-American members with Louisiana and Kentucky having only one and Arkansas, Mississippi, and Tennessee having only two. Despite the fact that Florida counts almost one-quarter (24.1%) of its population as Hispanic and Texas has more than one-third (38.6%) of its population who are Hispanic, there was only one Hispanic board member in Florida and five in the entire state of Texas.
It matters. Not only because such undemocratic procedures and lack of representation invariably disempowers the very people who should be empowered by the cooperatives, but also because it raises questions about whether such radically unrepresentative leadership can possibly deliver jobs, loans, scholarships, and other opportunities equally without regard to race, gender, ethnicity and other reasons, when the leadership has been so committed to the opposite practice in the rules and procedures governing their own affairs and elections.
As the report shows, it also matters if members are elected who are willing to embrace energy conservation and move away from the predominant reliance on coal generation to supply rural electric cooperatives which continues to be the case.
Efforts over and over again throughout the history of the cooperatives in the South have tried to challenge these practices and lack of diversity but whether temporarily successful or soundly defeated, the record indicates that permanent reform has not been achieved or sustained. Meanwhile most cooperatives are allowed to be self-regulated without sufficient due diligence practiced by the USDA and its Rural Utilities Service arm, the Internal Revenue Service, or, for the most part, state utility regulators. The fiction of membership-control is overriding the facts of membership disempowerment.
The federal government needs to stop providing loans or grants without guarantees of full transparency and equal representation in both rules and reality for consumer-members in every Southern service area. States need to pass legislation like Colorado has done to guarantee transparency, end proxy voting, and provide access for participation to members. Congress and state legislators need to resist lobbyists and trade associations and protect cooperative members.
Wade Rathke is a community and labor organizer who founded Association of Community Organizations for Reform Now (ACORN). He is currently chief organizer of ACORN International. This article is excerpted from the report “Democracy Lost and Discrimination Found: The Crisis in Rural Electric Cooperatives in the South.”