Posts Tagged ‘cooperatives’

boss

A good question, no?

One way of escaping the current American nightmare and of redefining the American Dream is to get rid of the bosses—such that workers can become their own bosses. And one way of doing that is, as Shaila Dewan argues, is to promote the formation of worker cooperatives.

The oft-proposed remedy for this state of affairs is redistribution — namely, taxing the rich to benefit the poor. . .Others want to raise the minimum wage. In contrast to those Band-Aids, worker co-ops require no politically unpalatable dictates. And by placing workers’ needs ahead of profits, they address the root cause of economic disparity. “If you don’t want inequality,” says Richard Wolff, the author of “Democracy at Work: A Cure for Capitalism,” “don’t distribute income unequally in the first place.”

Of course, a workplace doesn’t have to be managed by committee in order to channel more of the capital share to labor. Workers can just be given stock. Thousands of companies, including blue-chip firms like Procter & Gamble, already use stock as part of compensation, with the employee share of the company ranging from the single digits to 100 percent. But even this can be just another management strategy to harness the increased productivity that, studies have shown, accompany employee ownership and profit-sharing.

Support for full-fledged co-ops has inched into the mainstream as communities have grown weary of waiting for private investors to create good jobs — or sick of watching them take jobs away. In Cleveland in 2009, hospitals and a university gave seed money to a new group of businesses, the Evergreen Cooperatives, and now contract with them for laundry, energy retrofits and fresh produce. Last month, a government commission in Wales announced that “conventional approaches to economic development” were insufficient; it needed cooperatives. That same month, the New York City Council held a hearing called “Worker Cooperatives — Is This a Model That Can Lift Families Out of Poverty?”

Think about it: instead of workers blaming themselves (or being blamed by others) for being without a job, and jobless workers desperately attempting to sell themselves to bosses (or what we euphemistically refer to as “job creators,” who after all get to decide if and when they’ll decide to hire more workers, which these days generally excludes the long-term unemployed), why not create the conditions in which workers can band together and become their own bosses?

And, of course, we don’t have to limit the model to the underemployed and unemployed. Surely, millions of workers who currently have bosses in the existing—now turned nightmarish—business structure would benefit from the coop model.

As one reader of the article commented:

I’ve been working at a cooperative for 10 years and can never go back to working somewhere that I don’t have a voice.

The biggest barrier for worker cooperatives is educating and then empowering people to join or make their own cooperatives. It’s just too easy to keep doing the easy thing: working for someone else in an already established business. Once people are educated and see the benefits of cooperatives, I think they will also become spoiled for “normal” business structures, but I’m certain that’s not a bad thing.

That, to me, sounds like the beginning of a new American Dream.

 

From Edward Lambert, who writes:

Richard Wolff is on fire here. He is explaining the cooperative model and why it will save the US. I have never seen a better video on the subject. This video should be required listening for all economists. The ideas presented should be reflected upon and understood.

 

Gar Alperovitz puts forward a vision of economic and political change that embraces both uncertainty (mistakes will be made and new ideas will emerge) and radical transformation (new forms of economic and political democracy will be created in the process).

Lambert Strether offers some background to the cooperative institutions Alperovitz mentions in his talk.

 

Workers at the New Era Windows Cooperative [ht: ke]—which, as I reported, was formed one year ago—are celebrating the grand opening of their new unionized, worker-owned and -operated business.

AMY GOODMAN: What are you making at the New Era Windows Cooperative? I mean, how do people get involved? What are the products you’re making?

ARMANDO ROBLES: We’re going to start making replacement windows, vinyl windows and commercial windows—it’s our goal—and for affordable price and a good-quality product for the workers. At the beginning of this, I think we, us, know how to make windows. But after all work done we have at this point, I learned so much in this year. We put a factory in place in all the right spots. Yesterday, we have our check from the city. They checked—the inspector, they inspect the whole building, and they approve us our job. So, not even do just windows, but we would like to make a New Era for the United States, helping people creating cooperatives and create our good-quality and affordable windows for the region and for the United States.

JUAN GONZÁLEZ: And, Brendan Martin, I would have to assume that the labor unions alone and labor union members could provide a steady demand for the products of the factory. Have you gotten any—any bites or orders yet from—pressed by other unions or other—or unionized workers?

BRENDAN MARTIN: We have actually gotten early interest in the windows from people in unions, from housing cooperatives, and just from people across the United States and in the Chicago area who support jobs being saved by their workers rather than destroyed by their owners. But without a doubt, we still need more support to come in. So, anybody out there—these are residential windows. Anyone who’s listening can buy them. They fit in anyone’s home. They’ll save you money on your energy bill and pay for themselves in a few years. So, please come to our website, newerawindows.com, participate in this project by buying some windows, and then go out and start your own cooperative. We do have a lot of interest from the community, but we need more of the community to pile in and make this happen.

325568-bangladesh-factory-collapse

The death toll from beneath a collapsed garment factory in Dhaka, Bangladesh was pushed beyond 500 people on Friday, with the number expected to grow as more rubble is slowly removed.

The Associated Press is reporting that the rising number makes the 24 April disaster the worst of its kind in “world history.” It certainly is the deadliest garment-factory accident in world history—surpassing the 1911 Triangle Shirtwaist Factory fire in New York City (which caused the death of more than 100 garment workers) and the 2012 Dhaka Tasreen Fashions fire (which killed at least 112 workers).

But it’s certainly not the worst industrial accident, if we take into consideration such events as the 1906 Courrières, France mine disaster (in which 1,099 workers died) or the 1947 Texas City Disaster (in which a series of explosions and fires that started onboard a docked ship named the Grandcamp killed a minimum of 578 people).

The only way to make this time truly different is to follow the advice of Ananya Mukherjee and Darryl Reed, who argue we need to go beyond standard market paradigms, including the creation of “better” or more ethical consumers:

Huge struggles need to be waged to secure basic rights, which should have been guaranteed without a quibble. A more radical solution — that gets closer to the root problem of the lack of control — involves the development of co-operatives and worker-owned firms. Many countries have rich co-operative traditions, which need to be supported. For workers, they can mean the difference between life and death. Obviously, if the Bangladeshi workers were unionized, they could not have been forced back into a structurally unsound building. But if they could own their workplace, such a building would never have been built.

Exciting new experiments in co-operative ownership are being spawned in many countries. While the most well known of these are associated with food-related movements, others are also emerging in the manufacturing sector.

Building on co-operative principles, these initiatives involve brilliant organizational and legal innovations to adapt to local conditions. They are also trying to give voice to marginalized groups, such as women and indigenous communities. If we hope to contribute to their struggles for justice, we must support such initiatives by workers (and producers) that provide them greater decision-making power over the conditions of their work.

coops10

The next time someone suggests that workers shouldn’t run their own enterprises, you can give them ten reasons why worker-owned cooperatives rock.

Or you can simply suggest it would be hard for workers to do a worse a job than the boards of directors of capitalist enterprises—like the board of computer giant Hewlett-Packard.

¶ After ousting Mark Hurd as chief executive in 2010 amid messy allegations of sexual harassment, the board hired Léo Apotheker to replace him, even though Mr. Apotheker had been fired as chief executive of the European software giant SAP after just seven rocky months. Most of the board didn’t bother to meet Mr. Apotheker, let alone ask him any probing questions about his tenure at SAP, before rubber-stamping the choice of the board’s four-member search committee.

¶ In 2011, H.P.’s directors unanimously approved the acquisition of the British software maker Autonomy for $11.1 billion, a deal that was considered wildly overpriced even at the time. Less than a year later, H.P. wrote off $8.8 billion of that and claimed it had been defrauded. (Autonomy officials have denied the allegations, which are being investigated by authorities in both the United States and Britain.) Some consider Autonomy to be the worst corporate acquisition in business history. In fiscal year 2012, H.P. wrote off a total of $18 billion related to failed acquisitions and other missteps.

¶ With Mr. Apotheker at the helm and the board backing his strategic initiatives, H.P. announced that it was considering abandoning its giant personal computer business, then changed its mind. After Mr. Apotheker had been on the job a disastrous 11 months, the board demanded his resignation, and then paid him more than $13 million in termination benefits.

Shareholders might have forgiven what Fortune magazine called a “tawdry reality show” if the stock had performed well. But from the time Mr. Apotheker was hired in September 2010 until he left in 2011, the stock went from more than $45 a share to a little more than $22. Despite a recent rally, shares are still below $24, even as the Dow Jones and Standard & Poor’s 500-stock indexes are hitting new highs.

“You really couldn’t have a stronger case for removing directors,” Michael Garland, executive director for corporate governance in the New York City comptroller’s office, told me this week. “There’s been a long series of boardroom failures that have harmed the reputation of the company and repeatedly destroyed shareholder value over an extended period of time.”

 

Democracy Now! has been investigating democratic economics in the last couple of days.

Here’s a link to the transcript for the interview with Richard Wolff [ht: ja] above.

AMY GOODMAN: So what do you think needs to be done?

RICHARD WOLFF: A radical change in the policies. And I think it has to go far beyond simply reversing this austerity program, which, again, just for a word about history, back in the 1930s, the last time we had a breakdown of our capitalist system like this, we didn’t have austerity, we didn’t have cutbacks. We had the opposite. Roosevelt, in the middle of the ’30s, created the Social Security system, went to everybody over 65 and said, “I’m going to give you a check for the rest of your life.” He created the unemployment compensation system, giving all the unemployed for the first time checks every week for a year or two. And he created a public employment program and hired millions of workers. It’s the opposite of austerity. So any politician who says, “We must do this, because there’s no option,” has forgotten even the American history of not that long ago.

So, the first thing I would do is go in that direction—not austerity, but its opposite. But I want to go further, because I think our problem is deeper. This crisis wasn’t supposed to happen. When it happened, it wasn’t supposed to last a long time. All of that has been proven false. The problems run deep. And I think what we have to do, and what that book tries to do, is to talk about reorganizing our economy so that for the first time we can say we’re not only going to get out of this crisis, we’re taking the kinds of steps that can prevent us from having them over and over again as our unstable business-cycle-ridden economy keeps imposing on us. So, for me, it’s the more profound change that we finally have to face, painful as it is. After 50 years of a country unwilling to face these questions, I think we need basic change. And that’s what I spend most of my time stressing.

And here’s a link to a web-only interview with Wolff about his life and how Marxism influences his work.

AMY GOODMAN: The New York Times has called you “probably America’s most prominent Marxist economist.” Can you talk about Marx’s influence on you?

RICHARD WOLFF: Sure. I’m a product of the elite top of the American university system. I went to Harvard as an undergraduate. Then I went to Stanford in California to get my master’s degree. And then I went to Yale to get my Ph.D. So, by the normal standards of this profession, I’m the elite product of these institutions.

I was always struck that as I went through these schools, studying history, politics, economics, sociology—the things that intrigued me—I was never required to read one word of Karl Marx. And I remember telling that to my father, who looked in stunned disbelief at the very possibility that an educated person going to such august universities would not be required to at least read people who are critical of the society, simply as a notion of proper education. So with a father like that, it wasn’t so surprising that I went and found ways that individuals who were on the faculty sometime could, out of the classroom, teach me, take me through the great classics of critical literature, whether it was Marx and Engels themselves or Antonio Gramsci or George Lukács or all of the other—Rosa Luxemburg, the great thinkers of the critical perspective. So, I got excited about learning that on my own.

Then I discovered that these people are full of interesting insights about our society, and I should have been asked to read them. And the more I read it, the more I realized that I wanted to be an economist, but one who had a toolbox not only with the conventional stuff that I was learning in my university classes, but also with the nonconventional stuff. And, you know, over the last 40 years in America, it’s a sort of a sad comment, but if you’re interested in Marxism, then people look at you as if you either are a Marxist, or worse, some sort of caricature of a Marxist. So I always have said I use Marxist theory, I find it very insightful, I think it’s a shame that other people don’t have it, and I think it’s made me a better economist when it comes to writing and teaching than I would have been without that. And I think that would be the same for my colleagues, and that it’s a deficiency of theirs that the education didn’t do it.

I use a metaphor to get it across. If you wanted to understand the family down the street that had mommy and poppy and two children, and you wanted to really understand that family, and you knew that one child thought it was the greatest family the world had ever seen and the other child thought it was a psychologically dysfunctional group of people, what would you do? Would you talk to only one child, or would you talk to two? Clearly, you’d make up your own mind. You’d draw your own conclusions. But why in the world wouldn’t you speak to both of them, if you wanted to understand the family? Capitalism, our system, is the same. It has the people who celebrate and love it—and I, by all means, think you ought to read what they have to say. But you also have a large group of people who are very critical, and it is self-destructive of your own understanding not to expose yourself to what they have to say.

I would even go so far as to say one of the reasons this crisis we’re in now is as bad as it is and is lasting as long as it does, despite everyone’s prediction we wouldn’t have this again, is precisely because the people in charge of doing something about it, Republicans and Democrats alike, have no clue about the long, critical literature. Had they studied it, they would have been aware of the flaws and the faults in the system, would have been thinking about how to fix and improve upon them. We’d be in better shape to manage the crisis of capitalism if we hadn’t blinded ourself to the whole critical tradition, the chief of which is Marxian theory.

And, finally, here’s a link to a 2012 interview [ht: ra] Democracy Now! host Amy Goodman did with Mikel Lezamiz, director of Cooperative Dissemination at the Mondragón Cooperative Corporation in Spain’s Basque Country.

Evergreen

This is by far the best piece I’ve seen by Mark Thoma.

Building on a recent speech by Federal Reserve Governor Sarah Raskin, Thoma takes a clear stand against the idea that the national debt is our most important problem. We need to focus, instead, on “reversing the polarization of the labor market – the hollowing out of the middle class and the associated rise in inequality over the last thirty years or so.”

As everyone surely knows by now, the last few decades have not been kind to workers in the middle and lower parts of the income distribution. Technological change, globalization, and the decline of unions that gave workers political clout and countervailing power in negotiations over wages, benefits, and working conditions have eroded the economic opportunity and security that the post World War II era brought to working class households.

During that time it was possible, with little formal education, to get a relatively secure job offering decent pay and benefits. But those days are mostly gone, and changes in labor market conditions during the recent recession highlight the longer-term trends. Consider, for example, four facts from a recent speech by Federal Reserve Governor Sarah Raskin.

First, around two-thirds of the jobs lost during the recession were in moderate-wage occupations, but more than one-half of subsequent job gains have been in low wage jobs. As she says, recent job gains have been largely concentrated in lower-wage occupations. Second, since 2010 the average wage for new hires has actually declined. Third, about one-quarter of all workers are “low wage” (just over $23,005 per year in 2011 dollars). Finally, involuntary part-time work is increasing, and more than a quarter of the net employment gains since the end of the reces-sion involve part-time work.

But then Thoma misses what is probably the most important—and certainly most surprising—part of Raskin’s speech: her support for alternatives to capitalism.

Yes, that’s right: after acknowledging the limits to Federal Reserve policy (“while monetary policy can help, it does not address all of the challenges that low- and moderate-income workers are confronting”), Raskin looks beyond capitalism for a solution:

The Evergreen Cooperative in Cleveland, Ohio, is an example of a network of worker-owned businesses, launched in low-income neighborhoods, to support local anchor institutions. The cooperatives were initially established to provide services to local hospitals and universities that had agreed to make their purchases locally. This model is effective because it capitalizes on local production, and because it forges a local business development strategy that effectively meets many of the anchor institutions’ own needs.

It’s also effective because, in the midst of the Second Great Depression, the model of worker-owned businesses represents an alternative to the economic and social system that has failed us so badly in recent years.

Chart of the day

Posted: 21 February 2013 in Uncategorized
Tags: ,

copy_of_65JTFVERTICAL

source [ht: sn]

BIOME+3

Workers’ control, that is.

Today was the official first day of production under democratic workers’ control in the Viomichaniki Metalleutiki (Vio.Me) factory [ht: hk] in Thessaloniki.

With unemployment climbing to 30%, workers’ income reaching zero, sick and tired of big words, promises and more taxes, unpaid since May 2011 and currently withholding their labour, with the factory abandoned by the employers, the workers of Vio.Me. by decision of the general assembly of the union declare their determination not to fall prey to a condition of perpetual unemployment, but instead to  struggle to take the factory in their own hands and to operate it themselves. Through a formal proposal dating from October 2012 they have been claiming the establishment of a workers’ cooperative under full workers’ control, demanding legal recognition for their own workers’ cooperative, as well as for all the others to follow. At the same time they have been demanding the money required to put the factory in operation, money that in any case belongs to them, as they are the ones who produce the wealth of society. The plan that was drawn up met with the indifference of the state and the various trade union bureaucracies. But it was received with great enthusiasm by the world of the movements, which, through the creation of the Open Initiative of Solidarity in Thessaloniki and afterwards with similar initiatives in many other cities, have been struggling for the past 6 months to spread the message of Vio.Me across society.