The Buffalo Cooperative Economic Society (BCES): A Short History
By Dr. Monroe Fordham
During the several decades following the "great migration" of Afro-Americans to the northern cities, the economic and social problems confronting northern black communities became more intense. In their quest to find solutions to those problems, and improve the quality of life in their communities, many northern black spokesmen concluded that racial solidarity and self-help offered the best hope. The belief in self-help and solidarity among northern blacks during that period drew inspiration from the legacy of Booker T. Washington and the preaching of Marcus Garvey. Those ideas, coupled with the socialist influences of the depression years, contributed to a renewed interest in the formation of economic cooperatives in northern black communities.
In Buffalo, New York, the most dedicated advocate of black self-help and economic cooperation, during the depression and post-depression years, was Dr. Ezekiel E. Nelson--a local black physician. For more than three decades (the 1930's - 1950's) Dr. Nelson worked with an almost fanatical zeal to convince black Buffalonians that cooperative economics and racial solidarity would enable the race to escape from poverty and economic oppression. He preached that by working together, pooling their resources, and supporting their cooperative enterprises, blacks could build powerful economic institutions that would enable them to produce many of those goods and services that were needed and desired by the community. He believed that such enterprises would provide employment and income which would enhance the ability of the community to improve its standard of living. The profits from such ventures were to be reinvested in the community, thus promoting further development and improvement. Such was his dream.
Dr. Nelson was not a native Buffalonian. He was born in Louisiana in 1881. Following his mother's death, when he was ten years old, young Nelson was sent to live with his aunt and uncle who were sharecroppers. That family later moved to Texarkana, Arkansas where Nelson began his formal schooling at age fifteen. He completed all the grades in the local black school in four years.
Following his graduation from the Texarkana school. Nelson found employment with a local white family who, after recognizing that he was especially talented intellectually, urged him to continue his education. They pledged to assist him financially if he would enroll in the Tuskegee Institute. That school had already gained national recognition because of the work of its founder--Booker T. Washington. Nelson declined their offer because of a longstanding desire to attend Wilberforce University
In 1904, he left Arkansas and journeyed to Ohio where he enrolled at Wilberforce 'the same year. Initially he enrolled in prep courses before moving into the regular college curriculum. While at Wilberforce Nelson met and courted his future wife—Miss Alberta F. O'Leary, an education major from Jacksonville, Illinois. It was during those years that he also decided to become a medical doctor.
Following his graduation from Wilberforce in 1911, Nelson entered the medical school at the University of Michigan. After completing three years at that institution (Univ. of Michigan) he decided to delay his education because his lack of funds. After working for a time in Detroit, Nelson resumed his education in 19l6--this time at Boston University. He graduated from the Boston University Medical School in 1918. After his graduation he moved to Buffalo where he had worked in the summer of 1917 as a dining car waiter. In 1920, Nelson journeyed to Illinois where he married his college sweetheart—Miss O'Leary. The couple decided to make Buffalo their home.
It should be noted here that Dr. Nelson reached maturity during the era of Booker T. Washington's powerful influence. The keynote of Afro-American thought during that era (late 19th and early 20th century) was racial uplift through self-help and racial solidarity That theme found concrete expression throughout the institutional life of black America during that period. One product of that period was the Negro cooperative movement which had a major impact in the south. Dr. Nelson would recall in later years that the black uplift themes of the Washington era had a major influence on his thinking.
Being financially unable to set up a medical practice follow his graduation from medical school. Dr. Nelson continued to work as a dining car waiter with the railroad. That job took him regularly to New York City. The years 1919 - 1925 represented the peak period of the Gervey movement in the United States. Marcus Garvey's U.N.I.A. headquarters was located in Harlem and Dr. Nelson was frequently in attendance at the Garvey rallies whenever his dining car job took him to New York. Nelson was deeply moved by the Garvey doctrines of race pride, and racial uplift through unity and self-help. He was also impressed with Garvey's style and ability to organize. By 1925, Dr. Nelson was thoroughly convinced that black Americans could improve their economic status through cooperative self-help. In 1927 Dr. Nelson opened his medical practice. The following year he helped to organize the Citizens Cooperative Society. He was now ready to begin implementing some of his ideas regarding self-help and cooperative economics.
The Citizens Coop was formed in 1928. The general rationale behind founding the society was the belief that it would afford blacks of Buffalo an opportunity to help themselves and improve their standard of living through collective work and responsibility. The two most prominent leaders in the Citizens Coop were Mr. Jesse Taylor and Dr. E.E. Nelson. Mr. Taylor, a bricklayer by trade, served as president of the society during its first year of operation. The following year Dr. Nelson was elected to that office. Dr. Nelson held the presidency during all of the subsequent years of the society’s existence. The Citizens Coop also had an executive board which included Lloyd Plummer, Henry Payne, Eugene Scott Aubrey Reid, and Mrs. Alberta Nelson (Dr. Nelson's wife).
On April 29, 1929, the Citizens Cooperative Society of Buffalo launched its educational and membership campaign for that year. The campaign was kicked off at a rally held in Memorial Chapel, located at 155 Cedar Street. According to a publicity slinger, the purpose of the rally was to offer the community firsthand information about a movement which the organizer believed was destined to "revolutionize the living and working conditions among the working classes." The slinger stated that those who attended the rally would learn how a few earnest people, working in cooperation, could raise their standard of living, make more and better jobs for themselves and their children, and build a respectable business which would help the entire community.
Initially the group held its weekly meetings in the rea1 estate office of board members Plummer and Payne (326 Jefferson). As the membership increased the meetings were shifted to Walker's Funeral Hall, and Memorial Chapel. Members could invest in the society by purchasing shares at $5 per share. Most of the members held less than five shares.
In the fall of 1931, the Citizens Society launched what was to be its most important venture. The Citizens Cooperative Grocery Market was opened in a rented building on William Street (between Jefferson and Madison). (One former member recalled that the store was later re-located to another William Street building west of Jefferson). From the outset the store faced tremendous obstacles. For one thing it was launched at a time when many well established businesses in the community were folding under the economic pressures of the deepening depression. In 1931 unemployment in the black community was even higher than its normal crisis level. Then too, the lack of experience (on the part of the cooperative members and officers) in operating a grocery market must have been a serious handicap in their attempts to compete with other grocery markets in the community. The cooperative market was never able to overcome its serious disadvantages. After about a year of operation (continuously in the red) the society was forced to sell its holdings in the store.
The failure of the Citizens Cooperative Society's only business venture, coupled with the factionalism that had developed among some of the members, proved to be a fatal blow to the organization. Available evidence indicates that the Citizens Society was disbanded in (or about) 1933. However, the dream of racial uplift through cooperative economics did not die with the demise of the Citizens Coop. In spite of the initial failure, a number of stalwart members remained convinced that cooperative economics could be a viable and positive force in the black community. Under the leadership of Dr. Nelson, the few loyalists began making plans to reorganize the black cooperative movement in Buffalo. By 1934, they were holding regular meetings. In 1935 the group launched an educational campaign to attract more members. Adopting the name "The Buffalo Consumers Economic Society," the group became a formal organization on September 16, 1935. Dr. Nelson was elected president of the society.
During the late 1920's, Dr. Nelson had been attracted to the views of George Schuyler--a young black socialist and former editor of The Messenger (a black newspaper with a socialist bent), at that time Schuyler edited a weekly column in The Pittsburgh Courier. That column afforded, Schuyler an opportunity to present his views on ways and means of improving the lot of Afro-Americans, Schuyler argued that the masses of people (blacks included) would remain poor and oppressed as long as the people put their faith in individualism and private ownership of the means of production and distribution.
Dr. and Mrs. Nelson were subscribers to the Courier and were avid readers of Schuyler's column. Following the failure of the Citizen’s Coop, the Nelsons invited Schuyler to Buffalo to speak to their group, and help in their reorganization effort. The Nelsons continued to correspond with Schuyler during the 1930's. The Schuyler influence led Dr. Nelson to incorporate socialist arguments into his lectures and educational campaigns to win converts to the cooperative movement in Buffalo.
Following its formation in 1935, the Buffalo Consumers Economic Society quickly adopted the philosophy of the Rochdale Cooperative System. The Rochdale system was a very successful cooperative league that had been organized in England during the nineteenth century. In its first half-century of operation, the Rochdale cooperative had grown from seventy-four members with $900 in capital stock to 12,000 members and a business volume of $1.5 million. In 1935 Dr Nelson was convinced that the system could produce the same kind of success for the black community of Buffalo. During the next twenty years he would preach the doctrine of the Rochdale system at every opportunity.
The experience with the Citizens Cooperative Society had taught Dr. Nelson that the success of cooperative economics depended largely on community support. In an effort to educate the community concerning the goals and possibilities of cooperatives, he launched an elaborate and well planned campaign, which was sustained over a four year period-- 1935 - 1939. One important component of that campaign was the weekly educational classes. The classes were organized around semesters. During the course of a semester (15 weeks) Dr. Nelson or other speakers addressed a variety of topics aimed at raising the political and economic consciousness of the community. The topics covered included; "Economic Status of the American Negro," "Importance of Self-Help and Cooperative Economics to the Negro," "Techniques of Operating a Cooperative Business," "The Value of Cooperative Credit Unions to the Negro," and the like.
The lecturers often presented their ideas in a religious context. That is, they presented cooperative economics as a Christian duty and a sign of benevolence as well as an economic necessity. This emphasis was due largely to two factors. On the one hand, it was a result of the firm belief that sharing, working together, and benevolence were in fact characteristics of Christian living. On the other hand, by casting cooperative economics in the mold of religious doctrine, the society was able to minimize the chances of being labeled as socialists (which was considered radical at the time). Dr. Nelson presented most of the lectures, but occasionally other members presented their essays and position papers. In addition to the lectures, the classes often discussed pertinent articles from newspapers or magazines, or discussed assigned readings from books or pamphlets in the society's lending library. The attendance records for the classes shows that they were well attended.
In addition to the weekly economics education classes, the Society's educational campaign included two other components. The children of members were organized into a "junior coop." Instruction and other activities were organized for the purpose of teaching the young people principles of business and cooperative economics. The Society also operated a kind of free speakers bureau which sent selected members into churches, club meetings, and other community groups to explain the philosophy behind economic cooperatives and to point out how those principles could benefit the colored community. The educational campaign was very successful. Nearly 100 new families joined the organization during the 1935 - 1940 period.
In addition to its membership drive, the late 1930's was a period in which the society worked to tighten and formalize its organizational structure. A constitution and by-laws was adopted in February, 1938. In March of the following year, the board of directors applied for membership in the Eastern Cooperative League a federation of cooperatives in the northeastern United States. The board also voted to initiate the process that would lead to incorporation.
On March 30, 1939 the board approved a motion by Mrs. Beatrice Bailey to replace the word "Consumers" (in the name of the organization) with the word "Cooperative." Thus, the new name became "The Buffalo Cooperative Economic Society." That change was the result of extensive prior deliberation. The evidence suggests that the society had long range visions of getting into production, manufacture, and distribution of commodities in addition to being a consumer's cooperative. That vision is reflected in the objective of the society as stated in its by-laws. That statement reads:
The object of this society shall be to obtain for its members food, fuel, clothing, housing and other necessities of life as economically as possible by means of the united funds and united efforts of the members. The method employed shall be that of voluntary economic cooperation in buying, selling, producing and .manufacturing.
In May, 1939 the board designated five members of the society (Dr. Nelson, Mr. James Lewis, Mr. Jerhard Williams, Mrs. Beatrice Bailey, and Mrs. Eva Coles) to sign the Certificate of incorporation. The Buffalo Cooperative Economic Society (BCES) became a legal corporation in the state of New York in June, 1939. Earlier that year the board had begun making plans to launch the society's first business, a cooperative grocery market. Dr. Nelson and other former members of the ill-fated Citizen Coop were determined that the new society (BCES) would succeed in its business venture. In May, 1939 the board of directors rented a building located at 323 Jefferson. The BCES grocery market was officially opened at that address on June 17, 1939.
By the end of the summer of 1939 the society had finalized its plans to launch yet another business venture. They decided to open a Federal Credit Union. By so doing, they hoped to establish an institution which would enable the community to "hold on to" some of the money that passed through its hands. The BCES credit union offered the community an opportunity to build its own financial institution and share the profits therefrom.
When the BCSS held its fourth anniversary banquet in September, 1939 the estimate 200 persons in attendance had much to celebrate. During the previous six month period the society had become a legal corporation, it had established two important economic institutions, it had affiliated with the Eastern Cooperative League, and its membership had continued to show a steady increase. It had been a momentous year. While they had not grown at the same rate as the historic Rochdale organization, the members of BCES looked to the future with the anticipation of even greater achievements.
The society entered the 1940's with a great deal of momentum. That momentum accelerated during the first half of the decade. During its first year of operation the store had a sales volume of 21,000. Business was so brisk at times that the BCES board of directors found it necessary to hire several additional part time workers to supplement the three regular store employees. The society also purchased a truck to make deliveries for customers with large orders. Business continued to get better. At the end of 1943, the society paid its first dividend to its investors. By the end of 1944 the store had done almost $120,000 in sales. The balance sheet showed a cumulative profit of over $2,400. The financial reports 'show that of the first nine years of operation, the store experienced only one deficit year. The success of the BCES credit union was less spectacular but notable nonetheless. The Rev. James B. Benton, president of the BCES credit union reported, in April, 1945, that the credit union held $2,000 in capital.
In addition to its two business ventures, the BCES utilized numerous other means of generating income. From 1938 thru 1944, the society rented a building at 571 Clinton Street to serve as its meeting hall and headquarters. During the nights when that facility was not being used for BCES business, it was rented to other organizations who met there regularly. Usually the income gained from short term rentals was enough to cover the monthly rent paid by BCES. In addition to the rent income, the society had a women's guild that sponsored occasional fund raising activities. The sale of shares in the cooperative, and weekly dues also generated income for the organization.
Filled with optimism, the BCES board of directors began making plans in 1944 to purchase a building. They envisioned a facility which would house the store as well as their business headquarters and meeting hall. In October of 1944, Dr. Nelson informed the board of two vacant buildings that were up for sale. The society finally selected a large building at the corner of William and Madison Streets (498 William-185 Madison). In order to raise the necessary down payment, the board of directors asked members to make personal pledges. The pledges were to be loans or investments in the store. The minutes show that $5,000 was needed. By the end of January, 1945, nineteen members had paid over $3,800 in fulfillment of pledges. The deal to purchase the property was closed in early 1945, and in September of that year the BCS grocery market was moved from 323 Jefferson to the William Street facility. The society had the two apartments in the building remodeled and rented. The large upstairs was remodeled and rented as a pool hall and recreation center. The building also contained office space for the society and a meeting hall.
Following the purchase of the William Street property, the society launched an intensified membership drive to bring in new members and additional financial support. Dr. Nelson gave frequent "pep talks" to the membership, board of directors, and store employees, on the need to work hard and work together to make the store succeed. The society had clearly reached a crucial point in its history. If they could develop the store and their other investments into a model of success, they could be an example for the entire community. That would enable the society to prove to the larger black community he validity of the claims that cooperative economies could lead to major improvements in the quality of life in the community. Moreover, such success, by attracting new members and fresh financial resources, would make possible further successes and expansion. On the other hand, if the store were to fail, the consequences could be disastrous. Not only would the investors—believers in the dream of transforming the community through cooperative economics lose their money, but at the same time the idea of self-help through cooperatives would experience a serious setback. Conscious of the challenges that lay ahead, the society moved forward with a renewed determination. The membership drive of 1946 netted the largest number of new members since 1939. The balance sheet from the store continued to show a profit thru the middle of 1947.
By the end of 1947, store sales began to slip. The balance sheet of December 31, 1948 showed the first loss in more than six years. In 1948 the membership drive only netted two new families. By June, 1950 the store showed a. deficit of over $1,800. From that point on, things grew steadily worse. By January, 1952, the deficit had increased to over $5,400. Dr. Nelson and a dwindling number of supporters worked hard to reverse the downward spiral for Dr. Nelson it was a personal struggle. During most of his adult life he had been a strong believer in racial self-help and economic cooperation. He was convinced that the high unemployment, poor health care, poverty, and economic dependence which were widespread in the black community could be alleviated if that community would work together and make the necessary sacrifices to become owners and operators of the businesses that provided them with goods and services. In 1952 all of those hopes and aspirations were tied directly to the fate of the BCES, or so it seemed. At 68 years old. Dr. Nelson recognized that this was his last chance to make good a life long ambition. Most of the other stalwart supporters were also either past or nearing retirement age. Unlike the situation in 1933, when the Citizens Coop failed, they would not be able to reorganize and start again. During the decade of the 1950's, Dr. Nelson and the remaining loyal supporters often used their own resources in the effort to keep the store in operation and prevent foreclosure on the William Street property. Dr. Nelson also made other sacrifices. There are people in the community who still talk about how he sacrificed his medical practice in order to take on a more active role in trying to save the society and the black cooperative movement in Buffalo.
In the last year before foreclosure and liquidation proceedings, Dr. Nelson and the ten or twelve families who supported the BCES to the end still held a glimmer of hope. But the tide was irreversible. The Buffalo Cooperative Economic Society was going bankrupt, it was simply a matter of time. The end came in 1961.
Why did it fail? Some thoughtful member of the Society must have anticipated the importance of such a question. Among the records and documents of BCES there is a handwritten memo, entitled "Causes of Failure," which list six contributing factors:
(1) Policy makers for business in Negro community. According to Mrs. Nelson, black businesses (restaurants, etc.) did not patronize the BCES market nor offer any kind of encouragement or support for the cooperative movement in Buffalo. She felt that the unsympathetic and often "unfriendly" attitude exhibited by established black businessmen toward BCES damaged the credibility of the society; (2) Uprooting of Ellicott District; (3) Recessions during the early and late 1950's; (4) Unable to hold members to their agreement; (5) The rising cost of overhead; and (6) The rising number of supermarkets in the immediate area.
When the Buffalo Cooperative Economic Society disbanded in 1961, Dr. Nelson was seventy-seven years old. For the next eleven years he devoted most of his time to his medical practice at 473 Jefferson Avenue. During that time he also attempted to locate and organize the papers and records pertaining to the Buffalo Cooperative Economic Society. Even though his personal efforts in connection with cooperatives had ended in failure, he hoped that the records of those experiences might prove useful as historical sources.
On March 12, 1975 Dr. Nelson died at the age of ninety-one.