Comment by pjc50
7 hours ago
This sort of thing had a huge social movement in the UK in the 1800s, and parts of it still survive. https://en.wikipedia.org/wiki/The_Co-operative_Group , for example. The trick is that it doesn't "feel like" a co-op, for most customers it's just a normal shop with an unusual ownership structure.
The financial co-operatives, the building societies, fell victim to "carpetbaggers" in the 90s who encouraged members to vote for proposals to convert to traditional for-profit structures and get bought out by other banks. This was at the time a really good deal! Co-op members got big one-off payments.
It was only in the 2000s that we found out what the negative effects of bank consolidation were.
Not all the mutuals were destroyed by carpetbaggers. There are dozens (though smaller than the big famous ones from the 1980s) today. Some instituted "anti-carpetbagger" rules to make themselves unappetising.
For example if the Society decides anybody who became a member fewer than ten years before the vote can't benefit from a demutualization effort then it forces would-be carpetbaggers to plot this implausibly long game where they all agree to join in, say, January 2017 and then vote to tear the society to pieces in February 2027 having now all met the ten year rule. But in reality in 2026 when you send those "Everybody ready?" notes around to remind them of what to do in 2027 you'll find a bunch of your fellow plotters got money trouble meanwhile and had to quit, or found Jesus and changed their minds or died, or whatever else and so this plan falls apart.
Edited:: Also, I remember voting (as a young adult) against this because it's obvious what happens next. We didn't find out later, the usual idiots claimed they didn't know what would happen because admitting that they knew and did it anyway makes it obvious just how stupid they are.
> The trick is that it doesn't "feel like" a co-op, for most customers it's just a normal shop with an unusual ownership structure.
People know what it is, and there are other similar cooperatives too. They have over 5 million members so a reasonable proportion of customers must be members. if you regularly use one its silly not to be a member.
> The financial co-operatives, the building societies, fell victim to "carpetbaggers" in the 90s who encouraged members to vote for proposals to convert to traditional for-profit structures and get bought out by other banks
Yes, that was damaging good institutions for a one off profit from people who joined just for that profit. A number did survive. Nationwide is the biggest, but there are a few others around.
One of the things that differentiates them from shareholder owned banks is that they are keeping branches open.