Worker Cooperatives: Retooling the Solidarity Economy

Published on Center for a Stateless Society, by Sebastian A.B., April 30, 2013.

Under the cooperative model, workers own the business, reducing injustice because they have a stake in the community and because an individual will find it hard to exploit oneself. Workers often buy into their jobs (upfront or amortized), vote on major decisions in general assemblies or committees, and even voluntarily donate to the co-op for re-investment. Known as workplace democracy, this model of authentic self-determination renders state action superfluous.

The flagship Mondragon Corporation, the seventh largest company in Spain by asset turnover (and a federation of hundreds of cooperatives) is a controversial but impressive proof-of-concept that worker cooperatives can do everything the vampiric large-scale, capital intensive firms can, but better.

Today, worker co-ops have immense economic impact but unrecognized political clout. The cooperative is a sleeping giant: There are at least 30,000 U.S. cooperatives with at least $3T in assets, $654B in annual revenues, $75B in wages and benefits and 875,000 jobs directly created. [1] For comparison, Apple had $156.5B in revenues for the 2012 fiscal year. Rigorous studies on the viability of the cooperative model can be read on the website of the Quebec International Summit of Cooperatives here//

… Emerging Cooperatives:

  • For Yes! Magazine, Annie McShiras reported on the Brooklyn-based worker’s cooperative, Beyond Care, a childcare business and a part of the Solidarity Economy Network of collaborative enterprises in New York. Co-ops like Beyond Care bring together independent contractors to leverage clout, pool capital, exchange expertise and serve as social support systems for one another.
  • There are 68 other co-ops in the New York area listed in the NYC Solidarity Economy Mapping Project.  The international propagation of worker’s co-ops reflects changing views about the economy; one based on mutual aid, justice and human happiness instead of lifeless, arbitrary and abstract monetary value.
  • Yes! Magazine has described several other emerging co-ops. [7] Cleveland’s Evergreen Cooperative Laundry is one of them, which built a LEED-certified $6M facility in a city with crumbling infrastructure and high unemployment. The laundry is owned by its 50 employees. They seek to serve “anchor institutions” like the Cleveland Clinic and various universities. The laundry even solicited startup capital from them, instead of relying on financing from an investment bank that would demand unfavorable working conditions and tax breaks (not that tax breaks are bad in isolation, but they’re bad when they’re preferentially given to large corporations and nobody else).
  • The most revolutionary thing one can do is grow their own food. Likewise, large-scale urban agriculture co-ops like Evergreen City Growers are the backbone of radical independence, sustainability, health and justice.
  • Evergreen is a year-round hydroponic operation capable of producing 3 million heads of lettuce and 1 million pounds of basil per year (on the labor of only 50 people). Ohio spends $7B shipping food from places like California and Hawai’i; the health and petroleum savings are considerable.
  • This project is similar to many others seeking to alleviate the “Food Island” crisis of the inner-city, similar to the Growing Power project based in Minneapolis and spreading throughout the country. Co-ops also tend to be Green-minded, like Ohio Cooperative Solar, which installs solar panels.
  • These co-ops needed startup capital and banks don’t like unconventional models. So they did it themselves. The Evergreen Cooperative Development Fund provided seed financing to worker’s co-ops in the Cleveland area and in turn each co-op dedicates 10% of profits to the fund to expand the co-operative network. It is very much like Mondragon’s Caja Laboral credit union. The key to any hub of cooperative activity is financing, which is why credit unions are so vital.
  • Worker’s co-ops also favor local currencies that retain and amplify wealth within the community. These currencies also defend against hyperinflation, deflation and the paradox of thrift whenever the cartelized Federal Reserve credit system decides to simultaneously rob the people and destroy their economy.

Toward A Just Mode of Production:

  • The problem with Taylorist scientific management is that it fails to account for that which can’t be quantified: human dignity among them. Productivity can be boosted by treating people with respect, setting small goals and giving workers enough information to monitor the company’s finances. Management theory often fails to realize that worker happiness fuels the engine of production; even if the worker has the most advanced tools ever, it is all for naught if they recalcitrantly drag their feet because they feel oppressed, micro-managed and degraded.
  • There are no principal-agent dilemmas or tensions within the organizational structure of worker cooperatives. The worker-boss relationship is a vestige of feudalism, sharecropping and slavery because it rests upon coercion rooted in the desperation of the working class.
  • Labor has been expropriated and systematically emasculated by states to benefit the elite ownership class. Capitalists argue that labor has the freedom to turn down employment and go elsewhere, but this is not an option when one has been born into poverty. Employers offer the same deal and the only alternative is to starve.
  • The fact that there is such a thing as a permanently impoverished working class and a fixed wealthy ownership class (who need not work) betrays a seriously unnatural distribution of resources and responsibility.
  • Let’s break out the physics metaphors: Nature abhors a vacuum. Nature also equalizes temperature and balances particle concentration (which is why electronics work) — the concentration of wealth and power in the hands of the few conflicts with immutable natural law. The current power asymmetric is thermodynamically unsustainable. The stored potential energy will again become kinetic in the form of upheaval.
  • Worker cooperatives alleviate the pressure (increase conductance) by opening a gap in the membrane between the proletariat and bourgeoisie. Violent revolution is not wise, because states get repressive when they feel threatened and time is on the side of the masses. For fear of sounding reformist, however, it is incumbent upon all of those with creative powers to tilt full-throttle into the task of disseminating revolutionary ideas, means of production/consumption and disruptive technologies to expedite the shift, because a lot of people are suffering.
  • The current global imbalance would not have emerged if not for the hegemony of corporate power rooted in state violence. In the case of worker cooperatives, efficiency, order and profitability need not be sacrificed for social justice. These ends are not merely compatible, they are synergistic. As Pierre-Joseph Proudhon wrote, “Liberty is not the daughter but the mother of order” … //

… (full long text with hyper links).


workplace democracy;

Bargaining with the Top One-Tenth of the One Percent
, on organizing upgrade, by Labor Editors, Nov. 9, 2012;

A Kaleidoscopic Sense of Possibility: One of our most intriguing public intellectuals discusses his new book, on AlterNet,
interview with David Graeber on Democracy in America, by Lynn Stuart Parramore, April 24, 2013;

The Jobless Trap, on NYT, by PAUL KRUGMAN, April 21, 2013.

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