Introduction

The social economy refers to a broad set of organizations and practices that prioritize people and communities over profit, including cooperatives, mutual aid societies, credit unions, and community land trusts. In the United States, this sector has deep historical roots but has often remained invisible in mainstream economic discussions. Understanding the current state of the social economy and solidarity in America requires examining both its long history and the political forces shaping its future.

Historical Background

The origins of cooperative and mutual aid traditions in America stretch back centuries. The first documented cooperative in what would become the United States began operations in 1752, when Benjamin Franklin helped establish a mutual insurance society in Philadelphia (Nembhard, 2026). This early example set a pattern that would repeat across generations: ordinary people pooling resources to meet needs that markets and governments failed to address. The development of a distinctly American social economy was also shaped by the transmission of European economic traditions. Beginning around 1600, European immigrants brought with them the agricultural and handicraft practices of their home countries, including customs of shared labor and community-based economic organization (Yoder, 1944). These traditions adapted to new conditions in the American colonies and later became foundational to movements for economic cooperation.

The nineteenth century witnessed a dramatic expansion of cooperative activity. Worker cooperatives began appearing in the 18th century and grew significantly in the 1880s, often organized by unions during strikes (Nembhard, 2026). The aftermath of the Civil War saw the rise of the Knights of Labor and what historians call "The Great Upheaval," a period of intense labor organizing that included cooperative enterprises as a strategy for worker empowerment. Consumer cooperatives also flourished during this era. The earliest consumers' cooperative store in the United States was established in Boston in 1845, growing out of a cooperative buying club formed a year earlier. By the late nineteenth century, organizations like the Sovereigns of Industry and the Patrons of Husbandry were promoting cooperative stores and agricultural cooperatives across the country.

Mutual aid societies played an equally important role, particularly for communities excluded from mainstream institutions. Enslaved and freed African Americans formed mutual aid, burial, and beneficial societies, pooling their dues to care for the sick, support widows and children, and bury the dead with dignity (Beito, 2009). The Grand United Order of Odd Fellows in America, first organized in 1843, became the oldest African American mutual aid society in the country. Mexican communities in the Southwest established mutualista associations in the decades following the U.S.-Mexican War, creating networks of self-help and community solidarity (Pycior, 2014). These organizations were not simply charitable; they were expressions of collective self-determination by people who understood that formal institutions would not protect them.

The Social Economy in the United States Today

The contemporary social economy in America encompasses a wide range of organizational forms. Worker cooperatives, credit unions, community land trusts, food cooperatives, and mutual aid networks all operate within this space. Modern worker cooperatives span diverse sectors including alternative energy, textiles, and services, and regional networks have emerged to support their growth (Nembhard, 2026). The U.S. Federation of Worker Cooperatives, founded in 2004, represents a national effort to connect and strengthen these enterprises. In cities like Cincinnati, networks such as Co-op Cincy have helped worker and community-owned businesses expand into higher-margin services, raising wages across the cooperative (Inequality.org, 2025).

Solidarity economy initiatives have been particularly vibrant in American cities. A 2025 study of urban solidarity economies found that cooperative networks in three differently sized American cities are working to provide unmet basic needs including food security, affordable housing, access to fair credit, and employment opportunities (Vance et al., 2025). These networks operate through entities such as community gardens, credit unions, and cooperatives. In Boston, the Ujima Project has built a democratic, member-run organization that invests community-controlled capital in local cooperative businesses, with a mission to return wealth to working-class communities of color (JRF, 2026). In Jackson, Mississippi, Cooperation Jackson was founded in 2014 in response to chronic unemployment and impoverishment resulting from decades of disinvestment and deindustrialization (Urban Institute, 2024). In East Baltimore, the Village of Love and Resistance operates as a Black- and Brown-led cooperative addressing disinvestment through land reclamation and cooperative ownership (EBSCO, 2026).

Mutual aid networks have experienced a resurgence in recent years, particularly in response to economic crises and the COVID-19 pandemic. Community-powered refrigerators have expanded across cities like Milwaukee to address food insecurity amid grocery store closures (WUWU, 2026). In Baltimore, a wealth-sharing club was formed after federal layoffs, with members pledging a portion of their monthly income to help others stay afloat (Yahoo Finance, 2026). These grassroots efforts reflect a continuing tradition of Americans organizing to meet needs that neither markets nor government programs adequately address.

Economic Context and Inequality

The social economy in America operates within a context of stark and growing inequality. Recent data indicate that the racial wealth gap in the United States is widening, with white households holding significantly more wealth than Black and Hispanic households (NAACP, 2026). Nearly 60 percent of Americans report living paycheck to paycheck, and the country has more income and wealth inequality than any other major developed nation (Sanders, 2026). Real weekly wages for the average American worker are lower today than they were 53 years ago, despite enormous advances in technology and productivity. The term "K-shaped economy" has become widely used to describe this growing divide, where some groups and industries continue to accumulate wealth while many others struggle with stagnant wages, job insecurity, and rising living costs (Xinhua, 2026). This economic reality shapes both the demand for social economy alternatives and the political debates surrounding them.

Political Issues and Policy Debates

Perhaps the most consequential political issue affecting the social economy and solidarity in America today is the future of the social safety net. In July 2025, President Trump signed into law the "One Big Beautiful Bill Act" (H.R. 1), which enacted sweeping cuts to Medicaid, the Supplemental Nutrition Assistance Program (SNAP), and other low-income support programs (Kosec & Mo, 2026). These changes represent a structural narrowing of social protection in America, prioritizing tax cuts and defense spending over resources for the most vulnerable. The cuts to SNAP alone amount to nearly $200 billion over the next decade, threatening food assistance for 42 million Americans including 16 million children, 8 million seniors, and 1.2 million veterans (House Agriculture Committee, 2025). The Congressional Budget Office estimates that the legislation will take food assistance away from 2.4 million Americans and cut $187 billion from the program over the next decade (Hayes, 2025).

These policy changes have profound implications beyond material well-being. Research shows that social protection programs directly shape relationships between citizens and their governments as well as among citizens themselves (Kosec & Mo, 2026). Reductions in federal social protection therefore affect not only economic security but also governance, social cohesion, and democratic stability. When people lose access to basic support, trust in institutions erodes and the social fabric weakens. The debate over the safety net is not merely a technical discussion about budgets; it is a fundamental contest over what kind of society America wants to be.

The political response to these cuts has been fiercely contested. Legislation has been introduced to reverse the SNAP cuts and restore food security for millions of Americans (Wyden, 2025). Critics argue that allowing American children to go hungry so that billionaires can receive enormous tax breaks is both immoral and bad fiscal policy (NUL, 2026). The One Big Beautiful Bill Act provided over $1 trillion in tax breaks to the wealthiest Americans and the largest corporations while eliminating $187 billion from SNAP (Hayes, 2025). This trade-off between tax cuts for the wealthy and food assistance for the poor has become a defining feature of contemporary American politics.

Conclusion

The social economy and solidarity in America exist in a state of tension between a rich tradition of collective self-help and a political environment that is actively shrinking the public safety net. The historical record shows that Americans have repeatedly turned to cooperation and mutual aid when formal institutions failed them, from the mutual insurance societies of the eighteenth century to the mutualista associations of the nineteenth century to the solidarity economy networks of today. These traditions remain vital. At the same time, the current political moment presents serious challenges. The largest cuts to food assistance in American history, enacted in 2025, will push millions deeper into poverty and test the resilience of communities that rely on both public programs and private solidarity. The future of the social economy in America will depend not only on the continued energy of grassroots organizations but also on whether the political system chooses to protect or dismantle the social protections that millions of Americans depend on. The stakes are high, and the outcome remains uncertain.

References

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