The Basque Country’s Mondragón Corporation is the largest industrial co-op
theguardian.com
theguardian.com
There are also quite a few with mixed founder / employee ownership. Publix for instance employ 250,000 people across their supermarkets and are employee / founder owned.
A recent list of the largest from Oct 2023:
Very cool to hear, dude will likely be better off than me. Employee owned corporations are good.
Of course in my neck of the woods (Silicon Valley) it's expected that all 50 year olds are multi millionaires, as all you need for that is have owned a house for a few decades.
It was indistinguishable from a normal corporation that periodically grants stock to employees, except other forms of retirement contribution were sub-par, and vesting periods for everything were LOL WTF long.
Working conditions and such were worse than many places in ways that definitely wouldn’t have been the case if it were a traditional ownership structure with a union rather than employee-owned.
They did love to put that up front when selling a job there, though. As if it actually meant something.
The original point is about companies where workers have actual control. That's what's important, that's what's interesting.
A house I lived in got our electricity from a Touchstone Energy cooperative[1] and our rate was dirt cheap and they even mailed us a dividend check every year. I've even received a few checks from them after moving out of the area and no longer being a customer of theirs. They had great customer service too. They were significantly better in every way than the regional monopolies and municipal power companies I've dealt with.
I got in as a minor, so I paid $5 for my startup share. (Adults are $25). They’ve been giving me a $5 dividend share every year for a few decades.
And charge me $0/month for a pretty full-service bank experience (not common at banks in Canada).
They’re on a North American network of ATMs (Exchange & Accel) so I have pretty good coverage out of town, can even deposit cash/cheques into CDN partner ATMs. In a lot of smaller towns, you can’t bank on every big bank having a branch, but a good chance of a partner credit union.
Much more narrowly, I wonder if it could work for certified flight instructors. Most CFIs are young, know little about business, marketing, tax compliance. And as a consequence are often exploited by employers who misclassify them as independent contractors only to pay them less, without benefits, and still direct their schedules, coerce them into noncompetes. A co-op would help protect their interests while raising standards, in a cost efficient way.
That said, yes there are co-op schools, with the Co-Op School in Brooklyn, NY, being prominent: <https://thecoopschool.org/>
In a very real sense, public schools are already customer-owned cooperatives governed by a set of trustees elected by the customer-owners.
That said, once you have a school owned by the teachers it's no longer a public school. Public schools are funded by and governed by the public. A cooperative school owned by worker-owners is by definition not a public school.
In many jurisdictions, a teacher co-op can already obtain a charter to have an "open to the public, funded by the public, and accountable to the public" charter school. If we're going to be pedantic I think that would fit your funded+governed definition. owned+operatred might be closer to what you are gesturing at though, or perhaps local democratic oversight? Regardless, the old public/parochial types of school categorization is not nearly nuanced enough to be particularly useful for where things are already, let alone soon headed.
Producer co-ops generally are at least somewhat prevalent.
Two notable former examples are Visa and Mastercard (they've since reverted to publicly-traded corporations, in the aughts). Both were originally formed as co-operative ventures among member banks, effectively a producer co-op.
I've looked into worker co-ops previously, and noted that most examples seem to have relatively simple organisational needs, with typical sectors being food-service (restaurants and cafes), publishers, acting troupes, and if memory serves, a political party. Mondragon is notable for being an industrial manufacturing company.
There are also worker-owned (though not necessarily co-operative) businesses, such as Bob's Red Mill (milling and cereal products).
Consumer co-ops saw popularity in the 1960s and 1970s, but have largely faded from view. A niche they had occupied, "natural food store" is now dominated by Amazon through its Whole Foods subsidiary, though there are some independent co-ops still extant, often in quite unexpected locations. Three Rivers Market in Knoxville, TN, comes to mind.
Credit Unions are another often overlooked case of co-ops --- both in terms of being neglected over commercial banks and not being recognised as co-operative businesses.
The Nonprofit Quartery ran a recent article on recent trends in co-ops in 2022:
<https://nonprofitquarterly.org/where-are-new-co-ops-emerging...>
News of a 2015 list of the top 100 US co-ops:
<https://www.thenews.coop/list-top-100-co-ops-usa-released/>
And the 2023 listing: <https://impact.ncb.coop/hubfs/Co-op%20100%202023%20Report%20...> (PDF)
Breakout:
- Ag: 47 firms, $187.6 billion (59%)
- Finance: 17 firms, $39.1 billion (12%)
- Grocery: 8 firms, $33.1 billion (10%)
- Energy: 22 firms, $26.8 billion (8%)
- Hardware: 3 firms, $18.6 billion (6%)
- Other: 3 firms, $13.4 billion (4%)
I think Bob basically gifted the company to the employees (they bought in over 10 years, but at a valuation far lower than Bob could have got selling the company to an acquirer).
Some discussion on the employee ownership here: https://news.ycombinator.com/item?id=39374158
You missed a chance to mention PCC Community Markets, the USA's largest grocery store co-op, who are also located in Seattle!
(And just like Amazon, PCC was recently in a union labor dispute!)
When a Whole Foods opened across town, they shut down in less than a year largely because of the strength/quality/loyalty of the Davis Food Co-Op.
REI is a customer co-op, and in the past few years, hasn't exactly been a model employer.
And agricultural co-ops are neither.
https://www.agweb.com/news/business/technology/almost-half-l...
Why this structure? Is it more advantageous in the US?
A trust with the employees as beneficiaries solves a lot of these problems. It also prevents the co-op members from taking the company public for a huge payday.
The point that I was highlighting was that it comes down to the Articles of Incorporation and how ownership is managed on an ongoing basis. What happens when someone retires or you hire someone new.
If I were to retire and simply give my company to my 10 employees, Nothing would stop them from hiring new employees and not sharing ownership, leaving the company and keeping ownership, or selling their ownership to a third party.
(and possibly Sundar?)
Beyond that, stock _options_ aren't stock, and stock _grants_ to employees are often in restricted classes... they're not meaningful employee ownership because they're structured to ensure that they don't represent any kind of employee control over the company.
Makes no sense to me.
Case in point example: SpaceX shares are very illiquid but also very very much up since SpaceX was founded.
If that company is a co-op in which only employees are allowed to own shares, the only people I can sell my shares to are other employees.
In general, more willing buyers (who in turn know they can they sell those shares unrestricted in the future to any buyer), increases the people willing to bid on those shares at any given moment in time. (It’s the same basic reason that you’d rather have $100 in cash than $100 gift card for Starbucks.)
That sounds like plain old profit sharing, not ownership.
Worker cooperatives are organizations that are governed by their workers for their workers, not owned as property to be traded or sold.
1: Lower liquidity usually goes hand in hand with higher transaction costs, which means a bigger gap between how much the buyer pays and how much the seller walks away with.
2: Time value of money: Suppose some liquid asset can be exchanged for $X right now, and an otherwise equivalent illiquid asset can be exchanged for $X by, let's say, a month from now. $X today is more valuable than $X in a month, so no one is going to buy the illiquid asset today for $X if they could get the liquid one instead.
Rank and file aren't really "shareholders". We hold an utterly insignificant stake compared to funds and other corps. They can take a board of directors and bend their beaks all they way back to their rectums, force them to act against a company's best interests.
Employee ownership means the employees decide what they do with the profits derived from their labour. The company itself tends to benefit as well, in terms of stability, quality of work life, and long-term profitability.
Stock options in small percentages are a form of profit participation but a weak contributor to the question on if a business is a co-op.
Of course, any publicly-traded company can be 'employee-owned' to whatever degree the employees buy shares. But this term usually indicates something else.
Wikipedia page is a clearer read: https://en.wikipedia.org/wiki/Mondragon_Corporation
“How to transfer ownership of all publicly traded shares such that they are owned solely by the employees and not non-employee investors”
CEOs and management are simply there to prevent the above from happening, which is why they are paid by the board so much.
The boards are the unelected non-employee owners that need to go away
I must be thick, but I fail to understand how shareholders are "investors" of a publicly traded company? Yes, at some point, the company went to the market, and large sums of cash were exchanged for company shares, with the promise of a future return of part of the profit on that share. So yes, that moment could be seen as an investment.
But from that point onward, holding a share of a traded company has nothing to do with investment. Share holders are exchanging shares on the stock market, but at no point is any of that money going back to the companies they are trading shares of. They are just exchanging the "profit sharing promise" among each other, with no positive financial impact on the companies whatsoever. Quite the contrary, as they eat up a huge quantity of the available net profit, that could have been reinvested in the companies themselves.
In single share class companies then, the entirety of the “value” from a financial perspective is held in stocks and corporate bonds. Whomever owns these, has voting and control rights in a way that non-voting equity holders do not.
Notably almost no public companies give voting shares to employees- I’m sure there are examples but incredibly rare.
Shareholders benefit materially from the labor of the company by holding the asset that (theoretically) accretes value with no actual labor inputs.
That means that anyone doing labor is paying the shareholders from their paycheck every month.
Why is it like this, because the contracts people sign and the egregious power disparity makes it such that capital, the voting share holders, have ALL of the value that they can turn trade or liquidate or whatever because they gave money for shares and more shares means more power in the company. The board ultimately encourages this because they are only interested in capital returns and stock price.
Simply yes, the most of the investment happens when shares are issued - notably the IPO. However companies can issue new shares, or buy back/retire shares and reissue at a future date. The value from people holding shares maintains the price for which companies can cash in at a future date. So demand for shares on the market is sort of a store of value for companies.
Your question on reinvestment: a company is under no obligation to return profits to shareholders and can reinvest as much of their profit as they please. Amazon did this for years. Of course there are practical limits to this as board members often are representatives of shareholder interests. When a company no longer can make new credible investments, they are likely to return excess profits to shareholders. Different companies have different mandates from shareholders and different levels of scrutiny for what counts as credible reinvestment.
Now in practice there is the added layer of shares representing the interests of the make up of the firm. Board seats often are shareholders, creditors give preference to firms with valuable shares, Ceos are often paid in shares as sometimes employees at many firms.
Ultimately, there is no legal claim to profits from shareholders, nor is there legal claim to control. (Look at Google's multi class share obfuscating control). However giving profit and control helps stoke share price which is the store of value for firms as well, helps maintain access to credit/ financial strength, and represents the interests of the firm itself (via its board, creditors, CEO, employees etc.)
TLDR: companies issue /reissue new shares to finance their business. Maintaining share price stores value for business (and new demand builds that value)
And then everyone is surprised that real productivity doesn't seem to track the theoretical increase brought by technology. Well, maybe because most of that turns out to be replacing legible expense (salaries of well-defined jobs) with larger, illegible ones (everyone else doing tiny bit of extra work). Feels to me that your proposal would end up being just another case of that.
You started the paragraph with the word "workload," but here the load is about as close to zero for the average employee as one could get without being pedantic about it.
People aren't using virtual brushes and learning color theory to digitally paint their PowerPoints, or even composing their slides effectively in the visual space provided as a graphic designer would in Photoshop. They are writing and revising their drafts in PowerPoint, often using the default templates or perhaps 2-3 minutes of trying out different themes.
That ends up smearing all the costs and benefits of default PowerPoint look-and-feel across the audience for all these boring presentations.
But I claim the cost to the employee's time and education due to them technically having taken on the responsibilities of a graphic designer are, on average, effectively zero.
My point is that all of us are constantly distracted by random, intermittent tasks outside our specializations, which previously were done by dedicated specialists - people who could afford to become proficient at that work. This is a huge productivity hit for everyone.
That would turn $116 into $580 per year. Spread out, that would be approximately $22.30 per paycheck if biweekly, or $24.16 if twice a month. All before taxes, of course. Real life-changing money for hundreds of thousands of people, right?
The point here is not that spreading the money from the C-suite to the workers is in any way a bad idea. The point is that it doesn't go nearly as far as we might like to think. We might want to adjust our policy preferences and goals to reflect reality instead of dreaming of us all dining endlessly on the the fat of the C-suite.
Oh, and here's a reference for C-suite comp at JP Morgan Chase. Reliability unknown, but if accurate it means my assumption of a 5x multiplier is overly generous: https://www1.salary.com/JPMORGAN-CHASE-and-CO-Executive-Sala...
I thought the issue with such high/concentrated C-suite compensation isn't the envy (though that may be the case for some). The issue is that just by squeezing $116 per employee such a CEO can pay herself. Like if removing armrests from all employee chairs nets you a few additional millions of dollars, the temptation to do so exists.
If there was no such C-suite, there would be less incentives for pennypinching over basic employee wellbeing.
Nobody talked about that or said that they just asked to replicate the model in more industries, and seeing the sorry state of many products, that seems wise.
As someone that escaped a socialist country, I can and will have to ask you to take five minutes to enage with people comments instead of blindly barking.
Say an employee effectively gets $10 less money, but the company effectively now pays the government $1000 in the same period. That might mean new bus subsidies, legal aid, development grants... things which make everyone slightly better off in the long-term. I think that's a good trade-off.
There were many articles written on the impact of the 2021 Advance Child Tax Credit (up to $1,800 per child over a 6 month period). The impact was very significant on lower-income families - which makes sense because for those earning less than $40,000 per year, that amount is more than the amount in one's paystub.
Venezuela avg salary 230$ per month
Vietnam avg salary 277$ per month
Lebanon avg salary 190$ per month
Nigeria avg salary 730$ per month
Pakistan avg salary 293$ per month
Though, in the end, the US is extremely adversarial. So these people standing to loose out on the competition would do anything to stifle such innovations.
are you under the belief that you either earn 400k a year or 0?
what if middle management just got a reasonable compensation in line with what ordinary people earn? this is actually not even a foreign concept in the us. just look to the 60s.
But there will be fewer perks.
What a heartwarming story of employees knowing their worth and not settling for less.
Everyone's pay is to keep them, isn't it? Nobody is loyal beyond being paid.
Do CEO's really provide so much 'extra' benefit to justify the premium? Is their loyalty in particular worth paying so much for?
I'm just not seeing how 'ransom' is needed. Isn't growing a healthy business supposed to be the goal for CEO and Board? And if employee owned, it is same.
The only reason to pay the extra 'ransom' to be loyal to shareholders, is when they want the CEO to do things that are 'not' for the benefit of the company, but only to benefit shareholders, who can sell and exit.
It is possible, and even likely, that a healthy business differs in some material ways for a CEO+board than its employees, though I also expect there are also overlaps
If an organization has any goals besides growth at all costs it will fall behind.
It could just be tradition and the effects of history. But then why did US history create more shareholder corps while European history created more co-ops?
It could be that US investors are less willing to invest in co-ops. But then, why? Is there something about them that makes them less competitive? Why are they ostensibly worse in the US than in Europe?
My, admittedly uninformed, guess would be it has to do with 1) there are more worker protections in the EU than in the US and 2) Co-ops tend to pay employees better wages, have better benefits, etc.
Shareholder corps will try to drive down their labor costs as much as possible. Walmart goes so far as providing advice to how it's employees can best apply for food stamps, all the while keeping them under the 32hr/week threshold that would require them to receive benefits. This can provide a price advantage against co-ops who are not running these same practices. It the EU the labor protection laws are better so the potential difference of labor cost is diminished between sharecorp and co-op.
Europe had very strong socialist/non-capitalist political movements in the 19th century. Co-ops were seen as one alternative to capitalism, and were a huge movement.
For example in Finland the largest bank and largest retail chain are (consumer) co-ops, and in general co-ops are big players in the economy.
What investors?
2. Cooperatives tend to be more resilient in times of crisis:
https://onlinelibrary.wiley.com/doi/10.1002/jsc.2393
My reason for asking that question in the first place is that 'investor' isn't a role I associate with a worker-owned enterprise. The workers are the owners are the investors, so the statement reads as invalid to my mind.
The co-op movement arose as a reaction to industrialization and capitalism, which threatened many workers. You could understand it as capitalism based on membership rather than ownership, or as a third way that's neither capitalism nor socialism. But just like socialism never really took root in the US, other alternatives to capitalism didn't fare that well either.
Or you could say that they are co-owner of their means of production. So, as business owners, are they actually the ultimate capitalists in disguise? :-)
In general, self-employment is quite a different thing from owning of means of production that other people work.
They were oligarchic rather than democratic: only masters were full members. They were monopolies rather than competing in the market: you had to be a member of the relevant guild if you wanted to do business. And they were not businesses: each master ran their own business instead of working for the guild.
But I do wonder how much of its workability hinges on Basque nationalism rechanneled into something more useful than nationalism usually is. If that nationalism also had something like an independent state as a default outlet, the balance between cohesion and corruption creep might shift just enough across a tipping point. I'm really not sue that it can be replicated (but I'd love to be proven wrong!)
Basically none, it does not hinge on that.
If anything basque nationalism hurts the proyect more than it helps. Many of the workers in the basque country came "to disrupt" basque nationalism. So many of the old workforce in Mondragon is not basque born.
there was a civil war in spain, most of the industrial capacity was destroyed in the country but not in the basque country. There was a nationalist movement there, so the far right dictatorship thought they had a great strategy. Move people from poor spain to the basque country, you utilise the little industry that remains and you take over the nationalism with people who feel spanish.
The only bit of Basque "nationalism" that helped mondragon was that many of its competitors were kicked out. In the 70s and 80s a ton of american companies came to Spain, the far right dictator hiding his axis friends allied with america in exchange for some military bases and allowed american expansion in Spain. Basque country having some of the largest industrial network was a prime candidate for their location. Then the 80s and 90s had a ton of terrorism which scared american companies which left industrial giants like Mondragon without competition.
So basque nationalism played little part in its success, its more like the American boom of the 1950s, everyone else had a detroyed industry and they didnt so there was a boom. Basque country had the same thing but instead of building coca cola and taking over south american countries to sell cheap bananas they opened cooperatives. There is little reason other than chance that Sillicon Valley is not like that, early companies like IBM could have set up as coopearatives and their early advanatge would not have been disrupted in the sleightest.
I just grew up there, so most of it was less books and more just personal experience. But there are no few resources, books, shows or documentaries about the area.
On non fiction you have "The spanish civil war" by Thomas Hugh.
On the fiction side you have "For whom the bell tolls" by Ernst hemingway and "Homage to Catalonia" by George Orwell
If I can get a remote job, my wife and I are strongly considering how we could move there. Spain is the most fascinating place I’ve ever been and the place just… feels right? I don’t know how to describe it. It’s the only place I’ve ever felt like I fit in. Eskerrik Asko / Gracias for taking me back to a series of Camino sense memories.
Well I have been out of Spain for over a decade, so now when I go back I feel a bit like a tourist and I think it gets lovelier every year. If you ever make it back, either through work or for another trip I am sure you will have a brilliant time once again.
Pretty interesting idea. Are there other examples as well?
But it may be a different type of corporation than the standard US "limited liability" type (where you can only have your shares go to zero unless you're significantly materially involved AND do criminal shit).
In the US, I'm most familiar with Equal Exchange (fair trade coffee), Nebula (creator owned YouTube for documentaries), TESA (educational board games), Alvarado St Bakery (the tiger-branded breads available in many stores).
[0] https://en.wikipedia.org/wiki/Ranked_lists_of_Spanish_autono...
Its second only in GDP per capita because a number of big corporations moved to Madrid. There has been a slow but fairly unstopable centralisation in Spain, specially since the Catalan independence debalce a few years ago, more and more companies have moved their headquarters to Madrid. Which has raised the GDP of madrid a ton and moved many jobs there.
So this is the reason Spain has the highest youth unemployment rate in europe?
Hell, there's (at least) 3 separate co-op grocery stores in my city, they each compete with an Aldi, and multiple local grocery chains in their respective neighborhoods.
Same, and we’re deep red. My power company is a member-owned co-op. It’s cheap as hell (6.8¢/kWh for wind) and doesn’t enjoy burning down the state as a hobby.
I'm envious of those, they're all over the state but they're only out in the sticks.
I’d argue this is because a co-op can attract higher-quality workers for less than a purely profit-minded shareholder-owned business. (Similar to companies with a unique culture.) Generalise the model and you’ll get the co-op equivalent of the 70s-era UAW running roughshod where they can.
You can find some differences between western co-op and the socialist ideal (mainly, you still have hierarchy and a power structure mostly determined by how much you make), but to me it seems mostly academics.
Socialism is about societal ownership. A coop is not societal ownership. It is still private ownership in practice.
How many tech workers own shares in their company? Are those companies socialist?
A more political definition looking at government is "socialism is when capital is allocated for the benefit of the collective, capitalism is when individuals are granted exclusive ownership of capital to allocate how they choose".
Note that a worker's co-op meets the first definition of socialism, and the second definition of capitalism.
Socialism is defined by social ownership. The society as a whole owns production, rather than individuals or groups.
A coop is a just group that divides up ownership among all the workers, not the society/community. The division isn't necessarily even. And the workers don't necessarily have 100% ownership between them. For example, there are coops with publicly traded stock.
A coop can be, and often is, still privately owned.
If you're definition of socialism is "Workers owning means of production" (which by the way, is not and never has been the definition), then every FAANG is a socialist entity for awarding their employees shares.
And FAANGS are not owned by their workers, full stop. Less than 5% of Google's shares are owned by employees, and most of those shares are owned by management. Bezos personally owns more Amazon shares than everyone else in the workforce combined, Meta is well known for being in a strange situation where Zuckerberg personally owns more than half of all voting shares. Vanguard owns more shares in Netflix than the entire workforce combined. Apple has negligible employee owned shares.
Your misinterpretation comes from a willful twisting of the words "workers" (does not typically mean "the founder personally") and "owning" (which is typically understood as "having control over" rather than "maybe could break the tie between a handful of investment firms").
The private owner here is a co-op. Not socialist.
The community is normal understood as the complete body politic.
A partnership is not socialistic. Lawyers are capitalistic in most books, but they have partnerships.
The organization of a business doesn’t matter in capitalism. Capitalism, boiled down to private property and market. A co-op competing with other companies largely without price control is just as capitalistic as IBM or Google.
The definition of socialism is not, and never has been, "workers owning the means of production."
A coop still meets all the characteristics of capitalist entity:
- privately owned
- for profit, with profits going to shareholders
If you think coops are socialist, then you must also think any company that has more than 1 shareholder is socialist.
If you think private ownership (which coops protect and uphold) is allowed under socialism, then you don't understand what socialism is.
every socialist i know and have read agree that a coop is a socialist organization, and we will keep creating these enterprises as an alternative to capitalism, until one day, ideally, the capitalist corporations won't be able to compete in the job market with the coops, forcing them to socialize their ownership and power structures. despite whether you think it's socialism or not.
here are the 7 cooperative principles. please explain how this is capitalism? https://www.electric.coop/seven-cooperative-principles%E2%80...
> every socialist i know and have read agree that a coop is a socialist organization
Every unicorn I know thinks leprechauns are real.
A coop protects and upholds private ownership and distribution of profits to their shareholders. That's not semantics.
Socialism does not protect private ownership. Socialism does not distribute profits to shareholders (because there are none). That's also not semantics.
If you want to have a non-semantical conversation, the onus is on you.
But best of luck!
If you can explain to me how a co-op, which is a privately owned, and for-profit business structure, is not capitalist, I am all ears.
P.s. Definitions are important. Hand waving them away as "semantics" is a common trick of the ignorant.
After seeing time and time again the success of workers of bankrupted companies pulling up their compensations and unemployment benefits to rebuild the company in a co-op model, I wonder if it's not the opposite.
"Money attracts money", and I don't think it's too crazy to think that if everybody had access to low-interest credit under the same conditions as the big players, this model would be the norm, rather than the exception.
I'm not talking about letting people borrow at 0% to spend in food and utilities. What I'm thinking of is a system where the path from business plan to business isn't determined as much by the amount of capital one already has, which is what causes the usual corporate structures to be formed in the first place: those who assume "all" the risk in turn receive "all" the benefits.
That often doesn't reflect the real stakes at play. Investors can have a diversified portfolio (and often plenty of spare capital for more tries), while workers invest 100% of their work on the same company for years or decades. The co-op model is more natural but the dynamics of money make it more rare than it should be.
It’s because non-competitive markets are a market failure [1]. Not amelioration.
Source? Because unless America, much less Wyoming [1], are not “shaped by regular capitalist rules,” this statement is false.
There's a Tiktoker who is having the Amish build a barn on the land she bought in upstate New York and she keeps calling them "capitalist". The Amish in question are entrepreneurial for sure but that's not capitalism. The Amish keep their surplus labor value. It saddens me to see how fundamentally people misunderstand what capitalism actually is.
All we've done is replace the divine right of kings and landed aristocracy with the capital-owning class of the likes of Jeff Bezos. It's sad to see how many people champion their own serfdom when examples like Mondragon show it doesn't have to be that way.
You could just be an Amazon or a Walmart shareholder by logging into your Robinhood account, unlike the feudal regime where to become an aristocrat you would need to be some sort of famous knight, which seems much harder.
Second, owning 10 shares of Amazon doesn’t make you a capital owner. If you still need your paycheck to survive, you’re a worker, subject to the whims of your employer.
The really damaging thing about retirement accounts, for example, is that it has convinced people that they are current or future capital owners. It makes workers advocate against their own best interests.
The definition of capital owner being someone who doesn't need a paycheck to survive is weird. Your average startup founder needs a paycheck and he is clearly not a simple worker. As soon as you own shares in a company(or a bond) you are a capital owner. The question is then how much that capital is worth and what you can do to make this capital worth more.
Many Walmart and Amazon employees could not, due to lack of capital.
Even if they did buy stock in their company, I think it's pretty clear that is very different from being in a co-op as described in the article.
Dividends (can be) just writing cheques to yourself with your own money.
>Dividends (can be) just writing cheques to yourself with your own money.
Well, yes, since as a shareholder you technically "are" the company.
If employees have no say in how the company is run, CEO & board could easily run it into the ground (but jump ship with a gold parachute), then: yeah, most people will prefer a fixed paycheck.
But if regular employees are at the helm, company is more likely to do what's in the (long-term!) interest of employees.
Surely that'll make employees more willing to share in financial risks (+rewards!) of the organization. They're more personally invested in it - literally.
Let's hope this model gains more traction.
As you point out, the challenge is always around revenue sharing. From what I have seen, they last maybe 5 years and then break up when people feel like they are putting in more than they are getting out.
The productive difference between the top and bottom half of the N needs to be less than the extra efficiency the coop provides the top half of N. This isn't easy.
Eg top performer brings in 150k revenue, receives 100k salary, but can only make <100k without the coop.
I'm sure commission works well in companies where individual basically Works in isolation, but it is notoriously difficult to quantify productivity in teams and larger organizations. How much value does a engineer at Google create? Does a janitor at Google create? Of course you can divide the company profit by headcount, but that number is largely meaningless. Some people will be far higher some people will provide negative value.
For a co-ops, I think the game theory solution quickly converges on something that looks like a traditional company. You pay employees a market salary, and then split the corporate dividend proportional to salary. To account for differences in performance, the employees hire management too fire workers and give out raises. This works well for large co-ops, but obviously can lead to a lot of drama for a 10-person company
You don't get the offer in the first place if it is certain.
That it's not so common is an interesting question: does it get outcompeted by your standard corporation? Would people rather generally work as employees than take on risk as owners? Something else? I think in a co-op like this, employees would still be eligible for food stamps, and there's nothing preventing them from "decimating" a local economy, either.
I think this is "socialist", and it seems to be working, and everyone is happy, so more power to them. But my understanding is since there's nothing preventing people from setting this up, the "Red Scare" was not a bunch of people going, "hey, change the laws so me and my buddies can set up a co-op". Like, what's the actual policy change desired? "Let folks who want to run corporations and work for them do so, and let folks who want to operate in a co-op do so?" No, because that's our current situation.
Probably difficult at this point for enough lowly workers to pull their money and form a company, open stores, and compete with a Whole Foods.
The mega corps already dominate and can undercut anything that is starting up.
Amazon is kind of like a fiefdom where if they see someone building a castle in the distance, they can send some knights out to attack before it gets too big.
A developing nation even thinks about nationalizing their resource extraction? Suddenly there’s a coup with the CIA’s fingerprints all over it.
NATO is a foreign policy arm of the United States dedicated to crushing any leftist momentum. Hell, we recruited Nazis to run it.
We constantly back totalitarian regimes to crush leftists.
At a more local level we do things like make municipal broadband illegal.
Our government uses eminent domain to seize property for corporate interests.
The only non-terrorist domestic law enforcement the FBI does seems to be union busting.
We’ve started wars over communism.
We had private organizations like the Pinkertons crush collective action. Look up Homestead.
It was rumored that when the UK wanted a post-Brexit trade deal, one of our conditions was privatizing the NHS.
Every level of our society is devoted to crushing collective action.
In the Cold War, yes, because then it was assumed (rightly in some cases, wrongly in others) that any country who would nationalize their stuff was simply a Soviet puppet state following orders from Moscow. After the Soviet collapse, that isn't what the CIA (or American policy in general) cares about.
> NATO is a foreign policy arm of the United States dedicated to crushing any leftist momentum. Hell, we recruited Nazis to run it.
Everybody used Nazis after the war. Both the US and USSR snatched up every competent Nazi scientist, engineer, and intelligence officer they could and cut deals with them not to charge them with war crimes if they'd work for them. (Operation Paperclip for the US, Operation Osoaviakhim for the USSR). And of course NATO today isn't focused on containing Communism but rather the right-wing dictator who rules Russia today, and unlike in the Cold War, the current critics of NATO are almost entirely right-wing.
It is also human nature that most of us want someone that tells us what to do. Humans consistently organize into social structures where there is a leader in charge, whether it is a patriarchal or matriarchal extended family structure, a tribe, a club, a company, or a government entity a leader always emerges.
Capitalism is very much like Democracy. It's the worst system other than all the others that have been tried.
Undesirable jobs are done either way if people are paid, there's no difference if it's run by capitalists, the government or a co-op, you need to hire people and pay them. A co-op would work the same way.
Capitalism is definitely not like Democracy, democracy has been proven since ancient Greece to be a decent system to organise power, and it has evolved over time to be more inclusive. Capitalism has only shown that if left untamed and to grow on its own it will only consume more, exploit more, and remove freedoms of being a human being in the world if you don't pay up.
Capitalism is useful but every decade it seems to be reaching the limits of what it can be, no better version of capitalism has emerged, every evolution of capitalism has only magnified its destructive power. Democracy has done the exact opposite.
Competition between humans can turn ugly wheter on economic or political fields and "common folks" do ends up as collateral victims. Thats unchecked human nature
But there are other forms of socialism that do just fine and are alive today, like syndicalism. They work because they don't rely on a government to exist, correctly recognizing their power in industry.
The best years of America for the middle class were when there was a good balance between decent paying, unionized manufacturing jobs and the customers who chose to pay higher prices and get American products.
As offshore manufacturing got better, buying American became much higher percentage “feel good” and much lower percentage “get better product”. Right now, there are some product categories where the highest-quality product in the world is not capable of being produced in the US.
> Capitalism is very much like Democracy. It's the worst system other than all the others that have been tried.
Hunter gatherer bands in the Amazon live the way they have for 50,000 years - even prior to crossing the Bering Straits. Whereas societies where the capitalist mode of production predominant were barely even formed less than 500 years ago. Also from the time of the Paris Commune to the Cold War until now, it has been racked with threatening crises. Even in the US we see self-described socialist politicians being elected nowadays.
It's hard to make capitalism sound permanent when it has been so impermanent.
As much as “noble savage” is a comforting story, the truth is likely more complicated.
https://www.bbc.com/news/science-environment-67940671
https://www.npr.org/2011/01/12/132853997/Amazon-Once-Was-Hom...
https://davidgraeber.org/books/the-dawn-of-everything-a-new-...
Do Kibbutz have highly paid CEO's that earn much more than the members, and subject them to pay cuts?
As pointed out in this thread, a Co-op is socialist internally by sharing wealth across more of the labor. But capitalist externally since it sells to a capitalist world.
Eh, not a problem unique to socialism, or devoid from capitalism.
The history of labor in the United States is rife with both socialist (well, maybe anarchist) bomb-throwers and rich capitalists hiring private armies to gun down striking workers.
There are other systems that we've tried which work much better than the corporate Capitalism that we have in the United States. Most notably democratic socialism/social democracy/mixed economies (with the exact dividing lines between those three depending a lot on who you ask).
Socialism is alive and well and working.
Every major capitalist society today (including US) has a percentage of Socialism sprinkled in to keep it functioning. Pure capitalism leads to a brutish tragic world, so some socialism is added to at least keep people from outright starving and rising up in revolution.
> Julius Nyerere's leadership of Tanzania commanded international attention and attracted worldwide respect for his consistent emphasis upon ethical principles as the basis of practical policies. Tanzania under Nyerere made great strides in vital areas of social development: infant mortality was reduced from 138 per 1000 live births in 1965 to 110 in 1985; life expectancy at birth rose from 37 in 1960 to 52 in 1984; primary school enrollment was raised from 25% of age group (only 16% of females) in 1960 to 72% (85% of females) in 1985 (despite the rapidly increasing population); the adult literacy rate rose from 17% in 1960 to 63% by 1975 (much higher than in other African countries) and continued to rise.[4] However, Ujamaa decreased production, casting doubt on the project's ability to offer economic growth.
> The most prominent ecological consequence during this time in Tanzania was due to the forced settlements by the TANU government and President Nyerere. During the time of forced settlement, TANU provided more artificial means of agricultural aid while cracking down on yield results and as a result, production yield began to decrease and land became underdeveloped. Land was not being utilized to its full potential and therefore, not only were crop yields subpar, but the biodiversity also became inferior.
> There were also internal factors that led to the implosion of the Ujamaa program. The first was resistance from the public. During the 1970s there was a resistance from the peasantry to leave their individual farms and move to communal living due to the lack of personal capital that came out of the communal farms. This led President Nyerere to order forced movement to Ujamaa villages.
Above quotes were taken from https://en.wikipedia.org/wiki/Ujamaa
https://distributistreview.com/archive/mondragon-revisited?f...
The semantic challenge is that unlike the claimed differences between communism and socialism, Capitalism and capitalism share the same word, similar to Liberalism and liberalism.
So while the shelf-stocker might be earning $24/hr, their actual hard economic output is much less than this - $19/hr. The difference is made up by the salesperson making $26/hr, instead of $31/hr.
Many sales people might be fine with this sacrifice, but even more likely will not, and will tire of being the ones who need to sacrifice.
What is "fair pay" for labor in your eyes? Is it the entire surplus being generated? Why is that considered fair?
Yes.
> Why is that considered fair?
Because there is no value without labor.
The Amish tend to reject social ownership of land so they are not socialist or communist by any means. Distributist would probably be the best description with any mention in the literature.
However, there still is a fundamental difference between centralized corporate planning and centralized planning by the monetary authority. Corporations have to deal with market supply/demand, and we've seen enough examples of large companies simply going bankrupt to rest assured that large corporations are not invincible.
> The Amish keep their surplus labor value.
People don't want to live like the Amish.
> It saddens me to see how fundamentally people misunderstand what capitalism actually is.
The right to private property + market economy.
To the OP's point, do you think living like the Amish is necessary to keeping surplus labor value?
As I just explained, that's not what capitalism is. Capitalism is a relatively new invention (~500 years) that arose from the ashes of feudalism. Exact same economic structure. Different exploiters.
Consider this: markets exist in supposedly non-capitalist countries. They existed in the Communist bloc. We've got cuneiform tablets describing markets going back 5000+ years. Capitalism didn't create markets or a market economy.
This is what I mean when I say that not only do people not know what scoaialism is, they don't know what capitalism is either. Yet the instinct to defend it is so strong, particularly in Americans. That too is relatively new. Abraham Lincoln was a Marxist, for example.
> People don't want to live like the Amish.
Who says they have to? We can point to an example of people living co-operatively in, oh I don't know, the article of this submission?
> The right to private property + market economy.
Then why did market economies exist before and outside capitalism? Private property is a core tenet of liberalism (which really means "neoliberalism" today). Private property in capitalism can be more accurately traced back to enclosures, which are really an evolution of land grants under feudalism.
Earlier partial market economies were in practice more like command economies with relatively small free markets in certain sectors.
Is this widely accepted by historians or is this a fringe theory? Marx's Capital wasn't published until after Lincoln's death, so I'm a bit skeptical.
> supposedly non-capitalist countries.
They are State Capitalist. There's no supposition about it. That the governing body is captured by Communist ideologues has no bearing. Hence there are now billionaires operating in China and Russia.
> They existed in the Communist bloc.
They were re-introduced so fast it would make your head spin when Lenin's reforms were shown to be a disaster.
> Capitalism didn't create markets or a market economy.
I did not say so, and this is perhaps where your confusion lies. I said Capitalism is the right to private property and a market economy. I did not say markets are strictly endemic to Capitalism. Although you'll find no scalable one in a liberal democracy devoid of Capitalism.
> We can point to an example of people living co-operatively in, oh I don't know, the article of this submission?
A co-op is not tantamount to a society, it's an employer. The existence of a co-op in itself does not jeopardize the right to private property, or by extension Capitalism.
This is why the quiet part the zealots eventually meander to is "see, we just have to force people to..."
A market economy is one where resources (commodities, labour, services) are distributed primarily via the pricing mechanism, prices can be set freely by market participants and the market is generally open. It isn't merely an economy where markets exist.
Your examples were not market economies. They heavily restricted market access through guilds, hereditary jobs, serfdom, feudal law and trading licenses. They fixed prices through price edicts and decrees. On top of that, the majority of the population were subsistence farmers who also made most of their tools themselves. This means that the vast majority of resources were not traded in a market.
> That too is relatively new. Abraham Lincoln was a Marxist, for example.
Really? You're just going to state this as a fact without any backing at all?
wish more people understood the historical roots of the word "entrepreneur". americans conflate business/enterprise/entrepreneurship with capitalism. i think most people would be more open to these ideas if it weren't from the misinformation dating back to the red scare.
http://www.weisenbacher.de/mondragon/Mondragon_von_Hans_Nerg...
But after 45 pages or so Nerge drifts to communist Blabla.
Workers are better off.
As with any system, there are tradeoffs.
> That sentiment is echoed by Mondragón’s 70,000 other workers.
According to SCMP [1], Huawei has over 130,000 shareholding employees 3 years ago. So the "globe's largest" claim seems factually incorrect.
[1] - https://www.scmp.com/business/article/3173121/huawei-pays-ou...