Posts Tagged ‘cooperatives’


One of the themes of the conference this past weekend was a university mired in a crisis that has, at least in part, been created by the top-down management of boards of governors and academic administrators. So, there was a great deal of discussion of “unsettling the university” by forming unions and instituting more faculty governance.

However, otherwise dedicated and creative scholars had some difficulty imagining another alternative: the self-governing university. A university without bosses or, if you prefer, a university in which the workers are their own bosses.

As it turns out, that’s the topic of an essay by Shaila Dawan that was published while I was at the conference. She explains that, in the face of massive inequality (as analyzed by, among others, Thomas Piketty),

The oft-proposed remedy for this state of affairs is redistribution — namely, taxing the rich to benefit the poor. Piketty, in fact, proposes a global tax, one that can’t be avoided by private jet. 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.”

Exactly. The same, of course, might be true in universities. Perhaps even more so, because our colleges and universities both include profound inequalities (e.g., among campuses, academic units, and individual faculty members and staff) and reflect the growing inequalities in the wider society (e.g., in terms of unequal access to different kinds of higher education).

Creating colleges and universities that are owned and run by their workers (both faculty and staff, mind you) can—just like the bakeries and other enterprises mentioned by Dawan—change the way education is produced and, particularly important, the way the surplus is appropriated and distributed. In both private and public universities, the faculty and staff produce a surplus that is appropriated not by themselves, as a group, but by their “bosses,” the small number of individuals who sit on boards of trustees or regents (who, in turn, hire the growing number of administrators who run the institutions on a daily basis).

What if, instead, the university workers made up their own board (or, in larger institutions, elected representatives to a board) and hired the university administrators? Such a board would directly involve the workers in appropriating and distributing the surplus they produce and mean that they—not a board filled with representatives of large business and political cronies from outside the university—would decide on the general parameters of how the university functions. The worker-board would then hire administrators to carry out those decisions on a daily basis.

I understand, there are no guarantees. But it’s certainly likely the worker-owned university (with new roles for both students, who have to work with professors to get a good education, and members of the larger community, who want their children to get a good education) would both include and create much less inequality than is the case right now. And, at the same time, they would work with others to improve the quality of higher education.

Now, that would be real unsettling of the university. And the people who work in our institutions of higher education know they don’t need bosses to accomplish that.


Readers will remember that, in Evangelii Gaudium, Pope Francis developed a scathing critique of trickle-down economics and of the existing economy of inequality and exclusion.

How can it be that it is not a news item when an elderly homeless person dies of exposure, but it is news when the stock market loses two points? This is a case of exclusion. Can we continue to stand by when food is thrown away while people are starving? This is a case of inequality. Today everything comes under the laws of competition and the survival of the fittest, where the powerful feed upon the powerless. As a consequence, masses of people find themselves excluded and marginalized: without work, without possibilities, without any means of escape.

But, in that exhortation, the pope didn’t really address the issue of alternatives to contemporary capitalism. Now, he has—in the form of cooperatives.

In a recent audience [ht: db] with members of the Confederazione Cooperative Italiane,* Francis offered a practical alternative to the “throw-away culture created by the powers that control the economic and financial policies of the globalized world”: to establish new cooperatives and to strengthen existing cooperatives.

he spoke of the economy and its relationship with social justice and human dignity. Speaking of the need to “globalize solidarity,” he urged the confederation to bring co-operatives to the “existential peripheries” and to continue to be “prophetic” by “inventing new forms of co-operation.”

The Pope spoke of “a certain liberalism,” which “believes it is first necessary to produce wealth—and it does not matter how—to then promote some state redistribution policy.”

Others think it is up to a company to “bestow the crumbs of accumulated wealth” to those in need to then, in turn, “absolve themselves” of “their so-called ‘social responsibility’,” the Pope said.

“You run the risk of deluding yourself that you are doing good while, unfortunately, you continue only to do marketing,” without ever escaping the “fatal loop” of egoism, “which has the god of money at the centre,” he said.

Instead, the co-operative creates a “new type of economy” that allows “people to grow in all their potential,” socially and professionally, as well as in responsibility, hope and co-operation, he said. The Pope clarified that while he was not saying income growth is not important, it certainly “is not enough.”


*The Confederation of Italian Cooperatives is one of three cooperative organizations in Italy (the other two being the Associazione Generale Cooperative Italiane and the Federazione Nazionale delle Cooperative). Catholic-inspired cooperatives were originally part of the Federazione, which was founded in 1886, but then then they left to form a separate organization in 1919. In the 1920s, the fascist government disposed of all cooperatives and unions and the various cooperative organizations at the time were disbanded. After World War II, the cooperative organizations were formed once again.


This is a short, practical guide for those considering worker-owned cooperatives, made by GRITtv & TESA, the Toolbox for Education and Social Action. It features conversations with worker-owners fromNew Era Windows, Union Cab, Ginger Moon, Arizmendi Bakery, Anti-Oppression Resource and Training Alliance (AORTA), and more.

The quote in the title is from Ricky Macklin, of New Era Windows (at 7:11):

All of our lives we had been told that we was only this and we was only that. And New Era Cooperative allowed us to see that we was much more than that.

Wall Quotes - Abraham Lincoln - Labor is prior to, and independent of, capital. Capital is only the fruit of labor, and could never have existed if labor had not first existed

It is a glaring omission in his otherwise remarkable discussion of the relationship between Karl Marx and Abraham Lincoln, An Unfinished Revolution, that Robin Blackburn neither discusses nor does he include the text of Lincoln’s First Annual Message to Congress (the equivalent of what we refer to today as the president’s State of the Union), of 3 December 1861.

Composed at least in part as an answer to Jefferson Davis’s President’s Message of 18 November, in which Davis decries the actions of a president turned despot and celebrates the slave South’s “unconquerable will to be free,” Lincoln responds as follows:

It continues to develop that the insurrection is largely, if not exclusively, a war upon the first principle of popular government–the rights of the people. Conclusive evidence of this is found in the most grave and maturely considered public documents, as well as in the general tone of the insurgents. In those documents we find the abridgment of the existing right of suffrage and the denial to the people of all right to participate in the selection of public officers except the legislative boldly advocated, with labored arguments to prove that large control of the people in government is the source of all political evil. Monarchy itself is sometimes hinted at as a possible refuge from the power of the people.

In my present position I could scarcely be justified were I to omit raising a warning voice against this approach of returning despotism.

It is not needed nor fitting here that a general argument should be made in favor of popular institutions, but there is one point, with its connections, not so hackneyed as most others, to which I ask a brief attention. It is the effort to place capital on an equal footing with, if not above, labor in the structure of government. It is assumed that labor is available only in connection with capital; that nobody labors unless somebody else, owning capital, somehow by the use of it induces him to labor. This assumed, it is next considered whether it is best that capital shall hire laborers, and thus induce them to work by their own consent, or buy them and drive them to it without their consent. Having proceeded so far, it is naturally concluded that all laborers are either hired laborers or what we call slaves. And further, it is assumed that whoever is once a hired laborer is fixed in that condition for life.

Now there is no such relation between capital and labor as assumed, nor is there any such thing as a free man being fixed for life in the condition of a hired laborer. Both these assumptions are false, and all inferences from them are groundless.

Labor is prior to and independent of capital. Capital is only the fruit of labor, and could never have existed if labor had not first existed. Labor is the superior of capital, and deserves much the higher consideration. Capital has its rights, which are as worthy of protection as any other rights. Nor is it denied that there is, and probably always will be, a relation between labor and capital producing mutual benefits. The error is in assuming that the whole labor of community exists within that relation. A few men own capital, and that few avoid labor themselves, and with their capital hire or buy another few to labor for them. A large majority belong to neither class–neither work for others nor have others working for them. In most of the Southern States a majority of the whole people of all colors are neither slaves nor masters, while in the Northern a large majority are neither hirers nor hired. Men, with their families–wives, sons, and daughters–work for themselves on their farms, in their houses, and in their shops, taking the whole product to themselves, and asking no favors of capital on the one hand nor of hired laborers or slaves on the other. It is not forgotten that a considerable number of persons mingle their own labor with capital; that is, they labor with their own hands and also buy or hire others to labor for them; but this is only a mixed and not a distinct class. No principle stated is disturbed by the existence of this mixed class.

Again, as has already been said, there is not of necessity any such thing as the free hired laborer being fixed to that condition for life. Many independent men everywhere in these States a few years back in their lives were hired laborers. The prudent, penniless beginner in the world labors for wages awhile, saves a surplus with which to buy tools or land for himself, then labors on his own account another while, and at length hires another new beginner to help him. This is the just and generous and prosperous system which opens the way to all, gives hope to all, and consequent energy and progress and improvement of condition to all. No men living are more worthy to be trusted than those who toil up from poverty; none less inclined to take or touch aught which they have not honestly earned. Let them beware of surrendering a political power which they already possess, and which if surrendered will surely be used to close the door of advancement against such as they and to fix new disabilities and burdens upon them till all of liberty shall be lost.

Lincoln was, of course, no socialist—although Marx did believe the victory over slavery in the United States would help create the conditions for the general emancipation of the working-class. Thus, Marx composed a message from the International Working Men’s Association to Abraham Lincoln to congratulate him on his reelection in 1864.

For Stephen T. Ziliak, the fact that “capital despotism is on the rise again,” requires a fresh look at Lincoln’s idea that “labor is prior to and independent of capital.” For Ziliak,

The biggest problem of democracy is not the failure to fully extend political rights, however important. The promise of political and human rights is not perfectly fulfilled, true, though many gains have been made.

The bigger problem is economic in nature. The threat today is from a lack of economic democracy—a lack of ownership, of self-reliance, of autonomy, and of justice in the distribution of rewards and punishments at work—from the appropriation of company revenue to the lack of protection against pension raids and unfair taxes, capital despotism is rife.

The answer, Ziliak suggests, is the formation of worker-cooperatives and the expansion of the National Cooperative Bank so that it can supply funds to build and grown cooperative enterprises.

capital efficiency is not the definition of economic justice. Capital is a subtraction from labor, not the reverse. We mustn’t ever forget again what Lincoln told Congress not long after the start of the Civil War, when the capital relation was on many people’s minds: “The error,” Lincoln warned, the corruption, “is in assuming that the whole labor of community exists within that relation.”


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.