Posts Tagged ‘cooperatives’


One way of dealing with the problem of growing inequality is to establish a maximum wage. That’s what Franklin Delano Roosevelt proposed back in the early 1940s—a 100 percent marginal tax rate on incomes over$25,000 a year (roughly $350,000 in today’s dollars)—in order to “provide for greater equality in contributing to the war effort.”

Infuriated conservatives saw red, literally. The “only logical stopping place for this movement,” fumed Princeton economist Harley Lutz, would be “a completely communistic equalization of incomes.”

Simon Wren-Lewis reports his own recent suggestion for a maximum wage was greeted in much the same manner.

Well, if mainstream economists are going to howl about tinkering with tax rates, why not make them howl about a real change in the system whereby incomes are distributed? Like Filip Spagnoli’s suggestion to get rid of wage-labor entirely.

Spagnoli’s proposal is to combine a universal basic income (“to cover the costs of the necessities of life”) with an outright prohibition on wage-labor (in order to promote more cooperative, democratic forms of economic organization).

Would a UBI not be sufficient to allow people to pursue their goals? Why also prohibit wage labor? A UBI indeed loosens us from the system of wage labor – it provides a financial cushion that removes the risks inherent in abandoning a job and pursuing our “true destiny” – but it doesn’t go far enough. It gives us the freedom to turn down unattractive work but the pursuit of life’s goals often requires cooperation. Only the prohibition on wage labor makes cooperative ventures more common. A UBI by itself only pushes us towards more satisfying jobs and leaves some of the drawbacks of wage labor intact.

Makes sense to me. Guarantee a basic income for everyone and then, on top of that, encourage the formation of new kinds of enterprises, based on the idea that those who work in the enterprises decide how they should be organized (including, of course, how much they should be paid, what should be done with the surplus, and so on).

One of Spagnoli’s concerns is, “If people can’t work for a wage, many of the ‘dirty jobs’ may not get done anymore.” The fact is, we already have Cooperative Home Care Associates in New York City, which is the largest worker-owned cooperative in the country. It’s relatively easy then to imagine a system of such cooperatives, in which democratically organized workers do everything from toilet cleaning, waste disposal, and mining to teaching, healthcare, and software design.

The time is ripe to open up the debate about proposals like establishing a maximum wage, guaranteeing a basic income, and prohibiting any and all forms of wage-labor. The only price of admission is to listen to the howling of mainstream economists.


[ht: ijsi]

Back in 2011, I suggested that “a creative way of getting out of the current crises created by capitalism” would be for cities, regions, and states to establish something like an Office of the Creative Economy, whose task would be to “grow a diversity of noncapitalist enterprises.”

I just learned that, in June, New York City approved a city budget that contains a $1.2-million program—the New York City Worker Cooperative Business Development Initiative—to fund a community of nonprofit providers to facilitate the development of cooperatives. The idea is to build on the experience of Cooperative Home Care Associates—the largest worker-owned cooperative in the country—and start new businesses, support existing businesses, and expand the promise of workplace democracy to hundreds of low-income residents throughout the five boroughs. From what I’ve heard, the funding will also support the transition of existing businesses to democratic employee ownership.

Now, that’s a creative way of creating a new economy.


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,, 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.


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.