The Philosophy Behind The Cooperative This is the text of a message delivered on behalf of the Nebraska Cooperative Government on November 1, 1995, at the Tri State Governors' Conference held in Goodland, Kansas, where the Nebraska Cooperative Government and its Internet public administration company, Community Internet Systems, Inc. ( received an award for its pioneering efforts in Internet service to rural Nebraska. It reflects the philosophy of this very unique venture into cooperative government funded through utilization of Nebraska's unique local gaming laws. Since then the project has enjoyed continued growth and success and now has over 100 member communities and serves the following communities with Internet access: Columbus, Ogallala, Big Springs, Brule, Alma, Republican City, Orleans, Kimball, Bushnell, Humphrey, Creston, Lindsay, Duncan, Monroe, Platte Center, Tarnov, Cornlea, Genoa, Howells, Petersburg, Newman Grove, Albion, Schuyler, Rogers, Richland, Leigh, Chappell, Howells, and Clarkson. It distributes millions of dollars to member communities for community betterment projects and also provides complimentary Internet access to numerous libraries and schools across Nebraska and free web page hosting for businesses in rural Nebraska.

Communities of less than 50,000 population and geographically removed by more than a half an hour from a major metropolitan area have substantial resources along with substantial challenges to their future. These communities usually have sound work ethics, an educated indigenous population base, solid community supervision of their youth, better than average family structure, low crime rates, a high degree of individualism, good and sometimes excellent capital reserves, fresh air and clean water. They, however, unfortunately face significant challenges to their continued existence. Often removed from facilities of higher education, commercial air transportation, interstate highways, and entertainment, they find their population dwindling as agricultural efficiencies increase and many of their best youth are attracted to the opportunities of urban centers. Individually their population bases are simply too small to carry the overhead of major initiatives and attractive economic development programs.

However, just as the rain forests may hold the key to powerful new medicines, these communities just might hold answers to the seemingly unanswerable problems of the larger society. To let them blow away might not be wise. Could not these communities, the distances between them shrunk by high speed digital communication, commercial parcel services, and full and creative utilization of existing infrastructures be transformed into a free but manageable society for the 21st Century? But where was the capital to invent a new form of government, one with creative liaisons with private enterprise in instead of reliance on bureaucracies, and one that could transform a hundred thousand disorganized voices into the chorus of the future. What was there that could entice fiercely individual communities to unite on a project from which they could grow to trust each other and reap the benefits of unity and power?

Traditional vehicles for mobilizing people and capital were ill-suited for the challenge. Grants and programs originating in distant capitols and accompanied with mountains of bureaucracy could not be counted on and furthermore could not work. Prior commitments of the traditional political process had simply left pitifully little for the pursuit of vision. The usual sources of capital organization were also inadequate. Banks, increasingly more centralized, for policy and regulatory reasons, required a mountain of security and inappropriately promoted debt as the financing mechanism of choice for new ventures. The state securities laws, an outdated reaction to equity abuses of the 1930's, amplified the risk of failure to such a degree that any aware person dared not think of participating in local equity fundraising. Intentionally or unintentionally, the securities laws funneled area capital into highly organized and distant markets which in turn invested pitifully little back into the area. Likewise, traditional economic development efforts, which had communities begging and baiting foreign corporate boards, whose only interest was to milk a cheap and economically repressed labor force, could only ultimately result in the sons and daughters of the Pioneers being reduced to industrial drones with the cream of their productivity skimmed away.

It was in 1989 and in that context that it became clear that if any one was going to care, the care would not come from any place but the local communities that had every reason to care. Realizing that sometimes in the contradiction lies the answer and that sometimes the most conservative thing to do is to be daring, our political and economic initiative was undertaken. Fundamental to the success of any undertaking is its financing.  A substantial, renewable new cash stream had to be created. This cash stream had to be funneled into two directions: first into the local community betterment projects in order to provide some immediate economic relief and to motivate the formation a cooperative effort; and, second, into the engine of private enterprise needed to pay for highly educated talent, communication systems, computers, software, and aircraft needed to transform 75,000 square miles into the unified political and financial force that its people deserved. The only viable, unharnessed source of such 8 or 9 figure revenue was the huge sums of money being wasted on entertainment, luxury, and gaming products. It was with the express purpose of converting this consumptive spending into productive community investment that our political and economic initiative was undertaken.

The first phase of the vision, that of political union, has essentially been completed. Our goal of a metropolitan organization of over 100,000 population has been achieved and our Cooperative Government is recognized as an official body politic of the State of Nebraska. In that union, the principals of nullification and secession have found new functionality and enable a strong central government while retaining the absolute local autonomy that fiercely independent communities require. In some respects the Cooperative, now over 60 communities strong, is Nebraska's third largest city in population and largest city in area. As a government, it is unique. It levies no taxes and is entirely funded by a vehicle that converts millions of dollars of voluntary consumptive spending into productive investment. It has no employees, no property, no offices, and no bureaucrats. It functions entirely through creative liaisons with the private sector organizations functioning as professional private public administration companies.

As the Cooperative reached a functional population level, the focus of its energies shifted to the second phase of the initiative - concentrating on shrinking the physical distances between the communities by interfacing the intellectual and political forces of the communities. The obvious way to accomplish the interface was to provide universal access for all of our citizens to large scale digital information exchanges such as the Internet. This project is a substantial undertaking and will require substantial investment, both financial investment in routing equipment and phone lines and political investment in lobbying for legislative changes enabling sensible access to the existing telecommunications infrastructure. Working with Community Internet Systems, the private public administration company involved in the Internet initiative, the Cooperative in the last 4 months established Internet access for approximately 25% of its population. Just 2 days ago the communities of Ogallala, Brule, and parts of Keith and Perkins Counties joined the communities Columbus, Platte Center, Tarnov, Monroe, Duncan, and parts of Platte County with full local PPP access to the Internet. Home page development and access is now available to all economic development agencies covered by the Cooperative at no charge and free public access is available at public library locations in the communities with local access.

Still, two to five years in the future is Phase III - Capital Mobilization. Its focus will be the creation of an equity investment vehicle. It will enable us to directly deploy the capital of our communities without having to channel it through eastern brokerage houses and then beg distant corporate boards to invest it back to rural Nebraska.

Our initiative is simply a beginning and although today it is labeled a success, that can not be true because beginnings are ultimately judged by how well they were in communication with the entities of the future and by how much they enabled those entities to take form in reality. In the interim, we can only incrementally reveal that which exists in the future. More than that we can not do, less than that we dare not do!"


Brief History Of The Cooperative