The Bluefield Experiment in Co-op Economics: Why It Matters for HBCUs Today

This article is, with publisher permission, adapted from a more extensive journal article, “Teaching (Cooperative) Business: The “Bluefield Experiment” and the Future of Black Business Schools,” published by the Academy of Management Learning & Education.

Between the Civil War and the end of segregation, over 100 historically black colleges and universities (HBCUs) were founded in the South. Many have business and economics departments. Once these schools were leaders in teaching critical political economy (see Haynes & Gordon Nembhard, 1999), but this leadership has largely disappeared.

What happened? The case of the department of business administration at Bluefield Institute (now known as Bluefield State College), West Virginia, is informative. In the 1920s and 1930s, Bluefield’s business school developed an extensive program of cooperative economics and experiential business teaching. Today, few traces of this pedagogical innovation remain.

The idea that Black business schools could and should do more to have a greater social impact, instead of simply “teaching capitalism” to a demographic that traditionally lacked access to capital, has existed for over a century. A key influence that emerged at Bluefield was the work of pioneering African American thinker and civil rights leader W.E.B. Du Bois (1868 -1963). Today, Du Bois occupies a central place in post-colonial and African American studies (Gates Jr., 2011). However, his seminal thinking on economic cooperation has received comparatively little attention (Gordon Nembhard, 2014). By reviving this forgotten legacy and reconstructing the influence it had on a prominent HBCU, we help recover a rich and intricate history of Black business schools as sites of intellectual, political, and economic activism.

 

W.E.B. Du Bois and Economic Cooperation

Du Bois had set himself the twofold task of observing and analyzing the effects of race and racism, and of reforming economics thinking and teaching to tackle racial inequality. Du Bois strongly believed in the power of economic cooperation (Du Bois, 2007). In white America, Du Bois observed a competitive individualism that reflected a social Darwinism different from the norms of communal Africa (Haynes, 2018, p. 131). For Du Bois, what distinguished Black America were African traditions and philosophies such as Ubuntu and African cooperativism (see Mangaliso, 2001).

Particularly relevant to Bluefield were two reports by Du Bois on African American social betterment (1898) and economic cooperation (1907). These reports for decades offered the only in-depth study of Black cooperation until Gordon Nembhard’s Collective Courage was published in 2014.

The reports chronicle how Black communities overcame a deficit in economic initiative (1898, p. 21). “Cooperative benevolence” emerged, Du Bois noted, in the activism of Black churches, as well as civil and secret societies (for instance, the Masons), including in insurance, savings and loans companies, and cooperative businesses (Du Bois, 1898, p. 24; Du Bois, 1907). Additionally, in Economic Co-operation Among Negro Americans, Du Bois advocated co-ops as a means for the Black community to foster the accumulation of wealth “for social rather than individual ends” (Du Bois, 1915, p. 312).

Du Bois did not simply advocate for co-ops in his scholarship. He worked hard to promote Black cooperative enterprises across the US (Du Bois, 1919, p. 48). One particularly fruitful gathering took place in August 1918. Among the participants was William Matney, later a professor and director of the business administration department at Bluefield. This meeting started a chain of events that led to what would become known as the Bluefield experiment (Gordon Nembhard, 2014).

 

William Matney and Cooperative Education at Bloomfield

William Clarence Matney (1897 – 1988) was born in Virginia and attended normal school (secondary school) at Bluefield (BIRLS file of William Matney, n.d.; B.S.T.C., 1936, p. 46). He attended Harvard Business School from 1921-23 (Business School Alumni Bulletin, 1925, p. 11) and was one of the first African Americans to earn an MBA (The Value of Business Education, n.d.). In 1918, Matney met Du Bois. Du Bois and Matney founded the Negro Cooperative Guild, an organization charged with assisting Black Americans form cooperatives (The Value of Business Education, n.d.).

After Harvard, Matney moved back to West Virginia, where in 1923 he was appointed professor and then director of the department of business administration at Bluefield (We Doff, 1930, p. 24). Matney became determined to teach Bluefield students an alternative to traditional capitalism.

A year after he arrived at Bluefield in 1924, Matney appealed to the Negro Cooperative Guild for support to establish a student cooperative (We Doff, 1930, p. 25; Haynes, 2018, p. 141). This proved timely. In the mid-1920s, African Americans in West Virginia were denied job opportunities on account of their race in the chemical, glass, public utilities, and manufacturing industries, and professional salaries were also meager (Posey 1934, pp. 89-90). Black businesses in West Virginia (hotels, restaurants, cleaning services, grocery stores) that generated employment were also sparse (Posey, 1934, p. 91). Matney felt that economic cooperation could provide a solution to that predicament.

The co-op store at Bluefield was reserved only for university students, but it served as a crucial practicum for teaching cooperative economics. Indeed, according to a commentator of the time (Anderson 1931, p. 13), store management was purposefully coordinated with the Institute’s course of study in business. Matney argued that the co-op store could give students “experience with the handling of business problems as they arose in reality” (Matney, 1927, p. 3).

The Bluefield store was designed to meet the needs of its Black student population, selling schoolbooks and supplies, athletic possessions, cameras, pastries (made by the domestic science department), and other goods (Sims, 1925, p. 93; Anderson, 1931, p. 13). Student members of the co-op raised capital by selling stock within the cooperative society at a price of less than one dollar a share, and received dividends paid out of net profits at the end of the fiscal period (Anderson, 1931, p. 13).

The co-op’s board was comprised of stockholders elected from the respective classes of the business school, with one vote allocated to each stockholder (Sims, 1925, p. 93). Store managers were advanced business school students, who had an almost free rein in the management of the cooperative enterprise but regularly liaised and collaborated with faculty members.

 

Bluefield Store’s Premature Demise

We know that the store grew steadily. By 1925, 80 percent of the student body were investors (Co-op Store, 1925, p. 4). Dividends were duly paid to the stockholders, proving the store’s economic viability (Co-op Store Pays Dividends 1925, p. 11).

The co-op also boosted the quality of life on campus. An article from the local press celebrated the store’s seventh anniversary in 1931 (Anderson, 1931, p. 13). Other contemporary commentators (Hancock, 1935, p. 8) praised Bluefield as a hive of cooperative thought, with many “student activities …placed upon a cooperative basis.”

The student cooperative generated enough revenue to award scholarships to students earning high grades (Co-op Scholarship, 1925, p. 28). Nine scholarships were paid out of dividends from 1925 to 1931, and bestowed during an annual stockholder banquet (Anderson, 1931, p. 13).

Hazel V. Clarke, who served as the cooperative store secretary (Co-op Store Prospers, 1927, p. 4), went on to have an especially successful career after she graduated valedictorian in business administration from Bluefield in 1930 (Crestmont Girls, 1930, p. 13). She pursued a master’s in business education at the University of Pennsylvania and earned a second master’s degree at North Carolina State University (NC Educator, 1962, p. 5).

But the “Bluefield experiment” ended abruptly in 1934. In a letter addressed to Du Bois, Matney (1936) explained that: “the cooperative store was closed by a general State order that all stores in connection with schools or state institutions be taken over by the State.” A year later, DuBois (1937, p. 11) also referred to Bluefield store’s closure, explaining that the government of West Virginia had decided that state colleges could not go into business as this interfered with private enterprise.

The rise of public and socially minded enterprises had become rather contentious (Radford, 2013). Once largely perceived as a benign and unthreatening means to involve working people in the economy, as the co-op movement gained in economic and political power, opposition grew. In the US, especially, invoking a threat to the private sector by cooperatives became common in the press (Killingback, 1998).

On the other hand, one cannot discount racial motivations. West Virginia had experienced significant Black migration from the Deep South. By the 1930s, an economic downturn, unionization, and strikes by Black coal miners had triggered increasingly repressive measures by both white owners and the state (Trotter, 1990). The gradual mainstreaming of the Ku Klux Klan had also impacted local and state politics in large parts of the country (Gordon, 2017).

We believe the state’s decision to close Bluefield’s student cooperative and stymie further momentum should not be seen as an isolated incident, but rather as a powerful demonstration that the experiment challenged dominant policy views. As Gordon Nembhard observes (2014), it was not at all unusual for Black cooperatives to be obstructed by white supremacy.

The student cooperative’s premature end at Bluefield was unfortunate. Had it persisted, the potential to expand off campus and beyond is evident. Cooperative League of the United States (CLUSA) founding president J. P. Warbasse personally commended Du Bois for his support of cooperative education at Bluefield: “I am writing to express my appreciation of your co-operation with Mr. Matney in promoting the co-operative idea among the colored people”—he wrote in a 1927 letter (Warbasse, 1927).

However, the loss of the “proof of concept” provided by the store dealt a blow to cooperative business education at Bluefield and across HBCUs. Even as studies from the 1940s report the spreading of cooperative theories and practices across the economics departments of several HBCUs, as well as of African American-owned cooperatives in the proximity of such Black colleges (Brooks & Lynch, 1944), this ferment declined sharply during the following decades. Eventually, Bluefield itself, once proudly dedicated to the education of Black Americans, transformed into a mostly white college (Payne Brown, 2004, p. 4). In a move that many saw as irrevocably harming the legacy of the college, in 1966 West Virginia selected Wendell Hardaway to serve as Bluefield president and its first white leader.

Although outside the bounds of our inquiry, we believe that the racial tensions of the 1960s help contextualize the meaningfulness and legacy of the Bluefield experiment. During the following decades, as Black American colleges lost at least part of their radicality and uniqueness (see also Prieto & Phipps, 2019). Students, faculty, and alumni reacted to what they saw as a betrayal of HBCU’s original mission—lamenting the missed opportunities for their wider communities. Critically, these dynamics remind us that portraying marginalized group’s patterns of resistance is as important as analyzing their experiences of oppression.

One implication of this research for HBCUs business schools is the need to learn from their own history. Cooperative ideas stand among the forgotten pedagogical innovations of HBCUs. A second, important implication concerns how HBCUs might better serve Black youth today (Alsaaty, Abrahams & Carter, 2014). Presently, there remain 101 HBCUs, the vast majority of which offer business courses. These schools are well placed to act as hubs for the elaboration and transmission of emancipatory theories and practices, and for the training of future leaders of the liberation movement and Black organizations at large (Gordon Nembhard, 2004).

 

Towards an Emancipatory Black Business Curriculum

Today, the academy is called to produce “social science that matters” (George et al., 2016). African American organizations and groups, together with other historically subaltern populations, are particularly well situated to ideate and implement alternative roads to socioeconomic empowerment (Higbee, 1993).

First, we suggest that HBCUs’ curriculum should include Black business history, taught from a critical and racially aware perspective. Historical teaching would serve to introduce students to entrepreneurial pioneers and role models (Prieto, Phipps, Osiri, & LeCounte, 2017; Prieto & Phipps, 2019), contributing to more inclusive, relatable teaching that helps students learn to navigate the obstacles they face.

Second, HBCUs’ business curriculum should include alternative economic frameworks, and specifically cooperative business theory. In fact, being exposed to cooperative ideas may foster novel thinking among students on broader matters of social entrepreneurship and social innovation in vulnerable and racialized places (see Crenshaw, 1990). Intriguingly, these insights resonate with innovations emerging at predominantly Black institutions across the world, such as the bachelor’s degree in Cooperative Business offered at Ambo University (Ethiopia) and a similar program offered by Cipriani College of Labour and Co-operative Studies in Trinidad and Tobago.

Third, we recommend that Black business schools’ curricula include forms of experiential teaching. We thus suggest that, drawing on the student cooperative initiated at Bluefield by Matney, HBCUs scope novel ways to teach economic theory. More broadly, cooperative economics, critical economic paradigms, and educational approaches such as the ones experienced at Bluefield are not only apt for historically Black colleges and universities, but also business and research programs at predominantly white institutions (PWIs). As powerfully argued by Cummings and Bridgman (2016), greater diversity of perspective can encourage greater innovation.

Indeed, all students and staff can benefit from a more diversified and complete education and scholarly environment. At the same time, decolonizing business education and scholarship is especially crucial for Black students and teachers enmeshed in white institutions, as they disproportionately experience the economic and social vulnerabilities that stem from race.

 

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