AMES, Iowa -- Some people see cooperatives as the way electricity gets to their rural home, or how local crops get from grain bins to the market, or the way to buy fresh, locally grown foods. Some people call cooperatives a business model,but college students and graduates who have had experiences with cooperatives see them as a way to gain valuable work experiences, scholarships and the means to addressing community needs.

Members benefit
Mingwei Huang, Director of Education and Training at North American Students of Cooperation (NASCO), lived in a housing co-op as a student at the University of Wisconsin-Madison. The housing co-op was not only a beneficial living situation, it was also an educational experience.

"My co-op was in the heart of campus, but was not entirely a student co-op," Huang said. "In fact, it was about half student and half community and workers. This was very grounding for me since it's easy for students to live in a bubble. I learned a lot and developed many great relationships while living with so many great, interesting people."
In fact, skills like basic budgeting, communication, handling conflict, minor maintenance and accountability were skills she learned while living in the housing co-op that remain valuable to her today.

Member ownership and control
A housing co-op is significantly different from an apartment building, rental house or sorority or fraternity. As a member-owner, each resident contributes to the house labor and has a say in how it's run and managed. Huang used her time in a housing co-op to become involved on its board as vice president and in member education. These responsibilities gave her leadership experience, in addition to teaching her about collaboration, democracy and accountability.

"In our society, we are taught to think and act independently or in our own interests," she said. "We tend to organize our relations with others as sole independent people rather than interdependent groups and networks."

The ability for any cooperative to succeed depends on a collective effort, which Huang says is accomplished through healthy communication and navigation of power dynamics. These skills can carry over into the personal and professional realms.

Huang's experience with her housing co-op demonstrate three principles that are widely recognized and practiced by cooperatives: member benefits, member ownership and member control. According to www.eXtension.org, an educational partnership of 74 land-grant universities, these principles distinguish a cooperative from other kinds of businesses. The member-benefits principle is carried out when members unite to produce services otherwise not available, gain access to markets, or other mutually beneficial reasons. The member-owner principle is simple; members own the cooperative and have the financial and operational obligations and rewards of an owner. The member-control principle is exercised when members vote at membership meetings and serve on the board of directors.

Jesse Martin applies cooperative principles to the daily operations of Martin's Native Lumber of Dayton, Va., even though the business is a private, fourth-generation, family-owned business.

Communicating through one-on-one employee meetings and offering profit-sharing retirement portfolios are two practices Martin applies that reflect the cooperative business model.

"Cooperative education has allowed me to consider the world of business with a far more open mind," Martinsaid. "Often, I approach items in my own business with principles learned through the co-op education programs. I have found that if we think of our customers as owners and having a vested interest in our company, that we provide higher quality service."

Martin became involved with cooperatives after attending a conference during college and later becoming selected as the National Institute of Cooperative Education's chairman. The National Institute on Cooperative Education (NICE) is a youth scholar program that provides educational and social activities. The goals of the institute include increasing the understanding of basic cooperative principles, the challenges faced by cooperatives and the opportunities provided by cooperatives.

Expanding cooperative education
A leadership team made up of university faculty and researchers has created the eXtension Cooperative Community of Practice to increase the visibility of the cooperative business model with information they contribute to the website.

Leah Henkes, an Iowa State University senior in dairy science, contributed to the development of the cooperatives one Xtension website during her initial involvement with cooperatives.

"I think it is extremely beneficial for young people to learn about the cooperative business model because it gives them the chance to help network their abilities and resources," Henkes said. "By working with others to accomplish a goal it is easier to reach that goal."

Three Iowa State University students from Ron Deiter's Cooperatives class had the opportunity to attend the 2011 College Conference on Cooperatives (CCOC), a three-day program offered by the National Farmers Union (NFU) and the cooperative community of the upper Midwest on Feb. 19-21. The conference helps college students gain a more thorough understanding of cooperatives and the career opportunities available. It exposes attendees to the many areas of the economy stimulated by cooperatives - beyond agriculture.

Students wanting to be more engaged with local cooperatives, thinking of starting a cooperative, or wanting a better understanding of the responsibilities of a board member, can explore the resources available at the eXtension Cooperatives Community of Practice website. Leadership programs, local job opportunities, scholarships and careers offered by cooperatives are featured on the site.

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Charleston, SC - Today, Congressman Bruce Braley (IA-01) stood up for the rights of working families at a field hearing of the House Oversight and Government Reform (OGR) Committee in Charleston, South Carolina. The Republican-controlled OGR Committee held the hearing despite objections that it interferes with an on-going case before the National Labor Relations Board (NLRB). Rep. Braley defended the rights of working families in his opening remarks and throughout the hearing:

"We're facing a manufacturing crisis in this country - 15 factories are shutting down every day - but instead of addressing this issue and working to create new jobs, the Republican leadership has chosen to try and score political points. This hearing was a blatant attempt to interfere in an on-going judicial process - a process that should be free of tampering and interference to make it fair to both parties involved. By coming to a conservative region and calling conservative witnesses, the Republican members of the Oversight Committee are playing politics with the legally-protected rights of millions of working families across this country. Americans spokeloud and clear in November, they want us to create jobs and get our deficitunder control. That should be our focus, not attacking working families andtheir rights to organize and fight for fair wages."

 A video of Rep. Braley's remarks at the hearing is available here: http://www.youtube.com/watch?v=cjvOnhmMnMg

 

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In considering stories or editorials about the federal deficit or current deficit reduction negotiations, I hope you find the following information on the tenth anniversary of the Bush tax cuts helpful.  Should you need any further information, do not hesitate to contact me at (202) 224-3254.

"The most recent projections from the Office of Management and Budget indicate that, if current policies remain in place, the total unified surplus will reach $800 billion in fiscal year 2011. . . . [We can expect surpluses] "well past 2030 despite budgetary pressures from the aging baby boom generation, especially in major health programs. . . . The most recent projections make clear that the highly desirable goal of paying off the federal debt is in reach before the end of the decade." - Federal Reserve Board, Alan Greenspan, in testimony to Congress five days after George W. Bush took office as President.

"Tax relief will create new jobs, tax relief will generate new wealth, and tax relief will open new opportunities,"President George Bush, April 16, 2001.

Ten years ago - on June 7, 2001 - President George Bush signed into law the first in a series of tax cuts that disproportionately benefited the highest earners, with claims the tax cuts would stimulate the economy and that the government would still be expected to completely play off the national debt.

The opposite occurred.  In the years following passage of these tax breaks, the rhetoric of economic growth did not match the reality, and the fundamental legacy of the Bush tax cuts is debt.  In fact, during the decade after the Bush tax cuts were passed, "growth in investment, GDP, and employment all posted their worst performance of any post-war expansion."[1]

By contrast, the legacy of the Bush tax cuts is very different from the decade prior to Bush taking office, which resulted in large surpluses.  With the passage of the 1993 reconciliation bill through 2000, the size of deficits steadily declined, turning into growing surpluses in 1998 that steadily grew to a peak in 2000.

Similarly, compared to the economy under Clinton, the Bush tax cuts of 2001 did not result in employment growth.  In the three years after the passage of the 2001 measure, the U.S. actually averaged a 17,000 per month job loss.  In contrast, in the three years following passage of the 1993 Reconciliation Act, the U.S. gained 327,000 jobs per month.

The following charts illustrate how the Bush tax cuts have affected the deficit, the economy, and people's incomes.

During a 2001 address to Congress, Bush said, "At the end of those 10 years [in the 2001 budget], we will have paid down all the debt that is available to retire. That is more debt repaid more quickly than has ever been repaid by any nation at any time in history."[2] However, thanks in large part to the Bush tax cuts, the debt ballooned under Bush, with debt held by the public increasing from $3.5 trillion to nearly $6 trillion and gross federal debt going from $5.6 trillion to nearly $10 trillion.[3] As the Center on Budget and Policy Priorities found, "the tax cuts account for $1.7 trillion in extra deficits in 2001 through 2008, and is estimated to cost $3.7 trillion over the 2009-2019 period."[4] In addition, the extra debt-service costs caused by the Bush-era tax cuts, amounts "to more than $200 billion through 2008 and another $1.7 trillion over the 2009-2019 period ? nearly $330 billion in 2019 alone."[5]

Very simply, during the Bush years, spending rose as revenues dropped precipitously.  Over the last decade, government revenues fell from 20.6% of GDP in 2000 to 19.5% in the year of the 2001 tax cuts, and as the tax cuts phased in, continuing to fall in to 17.5% in 2008 before crashing, as a result of the recession, to 14.9% in 2009 and 2010.  Concurrently, spending rose from 18.2% of GDP in 2000 to 20.7% in 2008, and then, with the costs of the recession, escalating sharply to 23.8% in 2010, much of this increase due to the higher costs of existing programs and lower tax receipts.

Having already burdened the American taxpayer with this legacy of debt over the past 10 years, now both the House Republican budget and the House Republican "jobs plan" released in May include further reductions in the top tax rate from 35 percent to 25 percent. This plan ignores the facts of the past 10 years and asks middle class Americans to sacrifice so that the wealthy can benefit further.   As the Washington Post's Ezra Klein noted, "You could read [the GOP jobs plan] without knowing the past decade ever happened."[6]

Despite the performance of the economy in the 1990s, in the last 10 year, most Congressional Republicans have clung to an increasingly rigid ideology that any tax increase is bad and that sharp reductions in spending reductions do not cause economic harm.  This stance is in sharp contrast to that of Republicans of the past, who recognized that balancing the budget required a combination of spending reductions and revenue increases.   For example, after the 1981 tax cut, Reagan and many Congressional Republicans agreed to tax increases in both 1982 and 1984 because of deficit concerns.

Senator Harkin believes that Alan Greenspan's testimony over ten years ago reminds us that very good things can happen when our national leaders make tough fact-based decisions to both cut spending and raise revenue.  He believes there is no question that the time has come for tough budget decisions, but the smart way to bring down the deficit is for Congress to pursue a balanced approach of major spending cuts and necessary revenue increases, while continuing to make investmentsin areas that are important for maximizing job growth over the long term.  These include education, infrastructure and research for innovation, so crucial in our competitive world economy.

For more information, please visit http://harkin.senate.gov/.

WASHINGTON - Senator Chuck Grassley has offered an amendment designed to prevent fraud, waste and abuse of federal grant programs.  His proposal would amend a bill pending in the Senate which would increase the number of federal grants available for government infrastructure projects administered by state and local governments.

"Federal officials need to make certain due diligence is done on the front end to safeguard tax dollars from grant recipients who are delinquent in paying their taxes.  It's wrong that someone with big unpaid tax bills would be given a federal grant," Grassley said.  "After grants are awarded, federal agencies also need to follow up and make sure recipients of taxpayer dollars meet reporting requirements for how the money is spent."

Grassley was one of four senators who requested a government report that was released in May.  It found that 3,700 contractors and grantees owed $757 million in back taxes, but also received $24 billion in stimulus awards.  The study identified 15 cases of individual contractors or grantees involving "abusive or potentially criminal activity."  One construction firm owed nearly $400,000 in back taxes but received a contract worth more than $1 million.  One non-profit organization owed more than $2 million from years of unpaid payroll taxes, but received more than $1 million in stimulus funds.

Separately, since last fall, Grassley has worked to get the U.S. Department of Housing and Urban Development (HUD) to pay attention to the waste and abuse of tens of millions of tax dollars by the Philadelphia Housing Authority.  The Philadelphia Housing Authority received nearly $370 million in HUD money this year plus an additional $127 million in stimulus funds.  "The mess in Philadelphia shows the worst that can happen when the federal government doles out money, but then doesn't check to make sure that money is used for its intended purpose," Grassley said.

The amendment that Grassley filed to the Public Works and Economic Development Reauthorization bill this week would apply to federal grant programs authorized by the Public Works and Economic Development Act of 1965.

Grassley's amendment would:

1)      Ban government agencies from providing grants to any person or entity that is seriously delinquent with tax debt, including anyone with a lien from the federal government.
2)      Require that at least 10 percent of federal grants be audited annually for compliance with program requirements.
3)      Ban for two years any grantee with an unresolved problem based on an audit.

"This amendment is a common-sense accountability measure that should be adopted," Grassley said.

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