Can Co-operative Structures Solve Public Policy Problems? Parkland Institute: Co-op - Friendly Think Tank David Thompson Aurora Institute Vancouver, Canada

Can co-operative structures solve public policy problems? 2 Parkland Institute Alberta research network In Faculty of Arts, University of Alberta Non-partisan Progressive think-tank –bridge academy and public/media CCPA, Fraser Institute Academic standards – peer review

Can co-operative structures solve public policy problems? 3 Parkland - Outputs Research reports, books, occasional papers Conferences –“Power for the People: Determining our Energy Future” –Nov 17-19, 2006, University of Alberta –Keynote: John Ralston Saul –Go! Media – op-eds, articles, interviews, etc. Policy options to solve problems

Can co-operative structures solve public policy problems? 4 Parkland – Research Areas Public Policy Issues: Energy Environmental problems Health care Poverty and social justice Democracy and government Fiscal, economic issues

Can co-operative structures solve public policy problems? 5 Traditional Public Policy Solutions Regulation –Statutes, regulations, codes –Essential, but not enough Fiscal –Spending and taxation powers –Essential, but not enough, not done here Voluntary approaches –Ineffective, inefficient, costly – OECD (2003)

Can co-operative structures solve public policy problems? 6 Traditional solutions not effective Why? –Create incentives for good outcomes –Accept structures that produce bad outcomes For-profit business corporation –Profit good motivator to increase production –Profit good motivator to reduce costs –Increasing production or reducing costs not always a positive thing Example: environmental harm from production and externalization of costs

Can co-operative structures solve public policy problems? 7 Policy issue: Energy Security Raises questions of: –resource conservation –environmental protection –resource rents for owners (“royalties”) Parkland recommendations included structural changes: –Democratic management –Public interest mandate, not just profits –Didn’t address cooperatives specifically

Can co-operative structures solve public policy problems? 8

9 Policy Issue: Corporatization and Privatization Sell City drainage function to EPCOR? Huge asset – many billions of dollars EPCOR corporatized utility owner/operator –Power and water utilities here, Canada, US –No public control or accountability –Transparency very restricted Thus significant public debate on drainage City council vote

Can co-operative structures solve public policy problems? 10 Corporatization and Privatization

Can co-operative structures solve public policy problems? 11 Corporatization and Privatization Parkland Report and presentation to City Council: Reject proposal to sell off drainage –Successful, despite millions spent by other side Reform EPCOR –Convert to utility cooperative –Utility cooperatives common throughout the world –Accountable to people served –Serve broader range of goals than just profit maximization – e.g. environment

Can co-operative structures solve public policy problems? 12 Policy issue: Energy and democracy Parkland conference: “Power for the People” (Nov ) Panel: Can we transition to a post-carbon economy? Major challenge: Energy corporations –extremely profitable, politically powerful –aggressive at protecting their interests Can we ever succeed with this structure in the industry?

Transforming the Fossil Fuel Industry: Private sector ownership, Public interest mandate Power for the People Conference Parkland Institute University of Alberta November 17-19, 2006

Can co-operative structures solve public policy problems? 14 Ownership vs. Interest Served Public ownershipPrivate ownership Public interest Private interest Business corporations Charities Churches Social enterprise Crown corporations

Can co-operative structures solve public policy problems? 15 Issues in transforming the industry Legal capacity Financial capacity Trade challenges Corporate culture Political will Others…

Can co-operative structures solve public policy problems? 16 How is this emerging structural policy approach different? Old approach: alter rules (regulatory or fiscal) –Corporate programming conflicts with rules –Industry not cooperate / oppose –Limited success New approach: alter industry –Industry programming mirrors rules –Industry comply, cooperate –Far-reaching outcomes

Can co-operative structures solve public policy problems? 17 Why do we need a new policy approach? Why not just continue with the traditional policy instruments? Because outcomes not good enough in those policy areas Einstein: “Insanity is doing the same thing over and over, and expecting a different result”