Mainstream economists spend their time discussing and debating the relative merits of stimulus and austerity but there’s one thing they agree on: there is no alternative to capitalism.
But, of course, there are plenty of alternatives to the existing economic and social arrangements, which don’t limit our options to attempting to boost corporate profits via more government spending or imposing Draconian austerity measures.
One of those alternatives, as Richard Wolff points out, is the worker-owned cooperative, such as the Mongragón Corporation.
In capitalism, private owners establish enterprises and select their directors who decide what, how and where to produce and what to do with the net revenues from selling the output. This small handful of people makes all those economic decisions for the majority of people – who do most of the actual productive work. The majority must accept and live with the results of all the directorial decisions made by the major shareholders and the boards of directors they select. This latter also select their own replacements. . .
In May 2012, I had occasion to visit the city of Arrasate-Mondragon, in the Basque region of Spain. It is the headquarters of the Mondragon Corporation (MC), a stunningly successful alternative to the capitalist organization of production.
MC is composed of many co-operative enterprises grouped into four areas: industry, finance, retail and knowledge. In each enterprise, the co-op members (averaging 80-85% of all workers per enterprise) collectively own and direct the enterprise. Through an annual general assembly the workers choose and employ a managing director and retain the power to make all the basic decisions of the enterprise (what, how and where to produce and what to do with the profits).
As each enterprise is a constituent of the MC as a whole, its members must confer and decide with all other enterprise members what general rules will govern MC and all its constituent enterprises. In short, MC worker-members collectively choose, hire and fire the directors, whereas in capitalist enterprises the reverse occurs. One of the co-operatively and democratically adopted rules governing the MC limits top-paid worker/members to earning 6.5 times the lowest-paid workers. Nothing more dramatically demonstrates the differences distinguishing this from the capitalist alternative organization of enterprises. . .
Given that MC has 85,000 members (from its 2010 annual report), its pay equity rules can and do contribute to a larger society with far greater income and wealth equality than is typical in societies that have chosen capitalist organizations of enterprises. Over 43% of MC members are women, whose equal powers with male members likewise influence gender relations in society different from capitalist enterprises.
MC displays a commitment to job security I have rarely encountered in capitalist enterprises: it operates across, as well as within, particular cooperative enterprises. MC members created a system to move workers from enterprises needing fewer to those needing more workers – in a remarkably open, transparent, rule-governed way and with associated travel and other subsidies to minimize hardship. This security-focused system has transformed the lives of workers, their families, and communities, also in unique ways.
Enterprises owned by their workers and run in a cooperative—one worker, one vote—fashion thus have much more equal and secure patterns of pay and job allocation. (They’re not perfect, of course—and, over the years, the Mondragón Corporation has struggled with various issues, including levels of pay inequality and incorporating workers who are not members of the cooperative.)
The interest in worker-owned enterprises has, of course, a long history. I remember attending an international conference on worker self-management in Washington, D.C back in 1976 (if memory serves me, it was organized by the Association for Self-Management), when the Left was exploring alternatives both to capitalist enterprises and to Soviet-style socialism. I seem to remember (but it was a long time ago) a great deal of interest at the time in worker self-managed enterprises in Yugoslavia. Not to mention the long history of communal experiments in the United States, especially in the mid-nineteenth century, what with New Harmony, Oneida, Amana, and, the most important of all, the Shakers. Recently, the United Steel Workers have become interested in the success of Mondragón.
For those who are interested, there has been a resurgence of interest in making sense of Mondragón and of worker-owned cooperatives more generally in relation to Marxian conceptions of class.
I referred just about a year ago to a special symposium on “Worker Cooperatives: A Class Analysis,” which was first rehearsed as a panel at the 2010 Left Forum in New York City and then published in the July 2011 issue of Rethinking Marxism.
And then there’s an article by J. K. Gibson-Graham, “Enabling Ethical Economies: Cooperativism and Class,” published in 2003 in Critical Sociology. Here’s the abstract:
This paper situates contemporary evaluations of the ‘success’ of Spain’s Mondragon cooperative complex within a tradition of debate about the politics of economic transformation. It traces the long-standing suspicion of worker cooperatives among political and social analysts on the left, revisiting both the revolutionary and gradualist socialist critiques of cooperativism. Taking the set of problems identified by Beatrice and Sidney Webb as leading to the inevitable failure of producer cooperatives, the paper examines Mondragon for evidence of ‘degeneration.’ The ethical decisions made by Mondragon co-operators with respect to product, pay, profit, innovation, management, disputes and membership are discussed with a particular focus on the management of surplus production, appropriation and distribution. The paper calls for more sophisticated analyses of the economics of surplus distribution and the centrality of ethical debate to the construction of diverse economies and non-capitalist economic subjects.
In the midst of the Second Great Depression, we need to move beyond the tired mainstream debates about alternative ways of fixing capitalism and extend our thinking about Mondragón and other alternatives to capitalism.