Archive for the 'Economic Democracy' Category

Prosperity in Italy Spurred by One Region’s Coops

by Editors @ Monday, March 8th, 2010. Filed under Economic Democracy, Organizing, Socialism

Poster: Italy's Federation of Consumer Coops

The Emilia-Romagna Coops:

A Market Without Capitalists

 

By Frances Moore Lappe
Alternet.com
A market economy and capitalism are synonymous --- or at least joined at the hip. That's what most Americans grow up assuming. But it is not necessarily so. Capitalism -- control by those supplying the capital in order to return wealth to shareholders -- is only one way to drive a market.


Granted, it is hard to imagine another possibility for how an economy could work in the abstract. It helps to have a real-life example.


And now I do.

In May I spent five days in Emilia Romagna, a region of four million people in northern central Italy. There, over the last 150 years, a network of consumer, farmer and worker-driven cooperatives has come to generate 30 percent to 40 percent of the region's GDP. Two of every three people in Emilia Romagna are members of co-ops.


The region, whose hub city is Bologna, is home to 8,000 co-ops, producing everything from ceramics to fashion to specialty cheese. Their industriousness is woven into networks based on what cooperative leaders like to call "reciprocity." All co-ops return 3 percent of profits to a national fund for cooperative development, and the movement supports centers providing help in finance, marketing, research and technical expertise.
The presumption is that by aiding each other, all gain. And they have. Per person income is 50 percent higher in Emilia Romagna than the national average.

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Who Is To Be Master? What Happens When Workers Occupy Factories

by Editors @ Wednesday, March 3rd, 2010. Filed under Economic Democracy, Socialism, Trade Unions

Photo: Flasko workers in Brazil

[Note from CarlD: Following are two articles on what debates break out when workers occupy or take ownership of factories. The first is from a single case in Brazil, the second from an earlier regionwide meeting on the topic in Venezuela. I think these are examples of the unity and tension in what Gramsci called 'wars of position' and 'wars on maneuver'. The solidarity economy concept is both supported and contested.]

Workers from Occupied

'Flasko' Factory Repond

to Brazil's President Lula

 

On 12/01/2010 President Luis Inacio Lula da Silva said publicly in his weekly column "The President replies”, a question of journalism student (Camila Delmondes) on the struggle of the workers occupied the factory Flaskô.
The response given (which can be read http://imprensa.planalto.gov.br/download/Informe_da_Hora/PRR120110.doc) believe it is essential that the workers' management of Flaskô respond to Squid and the entire working class which was said the President. First of all, it is worth noting that since 12 June 2003 when we occupied the factory and resumed production to ensure our jobs, we await a response from the President. During these seven years almost non stop fighting for the maintenance of Flaskô open under the control of workers and always demanded that the federal government.

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Cooperative ‘Payment Solidarity’ Means a Prevailing Wage or Better

by Editors @ Sunday, February 28th, 2010. Filed under Economic Democracy, Socialism

Payment Solidarity:

Looking Deeper at the

Mondragon Principles

 

By John McNamara

The Mondragon Co-operatives maintain the concept of wage solidarity. From the beginning, the ratio of the highest paid position (manager) and the lowest paid (new worker) was locked at 3:1. In the 80’s this changed and today there are some positions that earn a 6:1 ratio and one (the CEO of the International MCC) who receives 9:1. Even with the tripling of the upper end of the ratio, it is still a far cry from the 150 or even 300:1 ratios that modern stock corporations tend to employ.

What interests me about this principle (and I think that it should be in the Identity Statement as well), is that Mondragon expresses the co-operative value of solidarity. It puts solidarity into the operations of the co-operative.

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Why the Mondragon Coops Started with a School for Youth

by Editors @ Tuesday, February 16th, 2010. Filed under Economic Democracy, Education

Photo: MCC's worker-owned university

Education, Training

and Information: Looking

Deeper at Mondragon

By John McNamara

Feb. 8, 2010

“It is said that co-operation is an economic movement that utilizes educational activities, but it can also be said that co-operation is an educational movement that utilizes economic activities.“–Don José María Arizmendiarreta, founder of the Mondragon Cooperatives.

Here's a fun exercise, well maybe interesting more than “fun”, at co-operative gathering centers around the principles. Ask the co-operators present, “Which is the most important principle.” If there are more than seven people in the room, you will likely get about eight different answers.

People often focus on the user principles and democracy as being the principles that separate co-operatives from other businesses. Of course, in my opinion, the best answer is that they are all equally important and feed into each other. Case in point: how strong can democracy be if the electorate isn’t educated or informed?

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Needed: Self-Management and Workplace Democracy

by Editors @ Tuesday, January 26th, 2010. Filed under Economic Democracy, Socialism

Participatory Management:

Looking Deeper at the

Mondragon Principles

 

By John McNamara

The next principle from Mondragon is that of Participatory Management. This seems like a no-brainer for worker co-operatives. What is the point of going through all the work of setting up a worker co-op if the workers don’t actually have a say in how the place is run? They would be better off in a unionized Employee Stock Ownership Program.

I’ll get more into this in a second. First, I want to share the language of the principle from Mondragon (translated, as they all are, of course):

“The Mondragon Cooperative Experience believes that the democratic character of the Cooperative is not limited to membership aspects, but that it also implies the progressive development of self-management and consequently of the participation of members in the sphere of business management which, in turn, requires:

a) The development of suitable mechanisms and channels for participation.

b) Freedom of information concerning the development of the basic management variables of the Cooperative.

c) The practice of methods of consultation and negotiation with worker-members and their social representatives in economic, organisational and labour decisions which concern or affect them.

d) The systematic application of social and professional training plans for members.

e) The establishment of internal promotion as the basic means of covering posts with greater professional responsibility.”

(source: The Mondragon Cooperative Experience, by José María Ormaechea, 2000)

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High-Speed Rail - Why We Need a Green Industrial Policy

by Editors @ Sunday, January 17th, 2010. Filed under Economic Democracy, Green Industry, High Road Economics

 

China's High-Speed-Rail Revolution:

Dedicated lines are the key

to record-breaking speeds.

By Peter Fairley
MIT Technology Review

Jan. 11, 2010 - China has begun operating what is, by several measures, the world's fastest rail line: a dedicated 968-kilometer line linking Wuhan, in the heart of central China, to Guangzhou, on the southeastern coast. In trials, the "WuGuang" line trains (locally built variants of Japan's Shinkansen and Germany's InterCity Express high-speed trains) clocked peak speeds of up to 394 kilometers per hour (or 245 miles per hour). They have also recorded an average speed of 312 kph in nonstop runs four times daily since the WuGuang's December 26 launch, slashing travel time from Wuhan to Guangzhou from 10.5 hours to less than three.

WuGuang's speed blows away the reigning champion: France's TGV, which runs from Lorraine to Champagne and averages 272 kph. It also bests China's first high-speed train, the Beijing-to-Tianjin trains that average 230 kph, as well as Shanghai's magnetically levitated airport shuttle trains that can hit 430 kph but average less than 251 kph.

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Worker Coops and Their Requirements for Capital Within Limits

by Editors @ Tuesday, January 12th, 2010. Filed under Economic Democracy, High Road Economics, Socialism
 
Photo: Punching machine at MCC factory

The Instrumental and

Subordinate Nature of Capital:

Looking Deeper at the

Mondragon Principles

A series on the core principles of
the Mondragon Cooperatives in Spain

 

By John McNamara

“We do not aspire to economic development as an end, but as a means.”

–Don José María Arizmendiarrieta, spiritual founder of Mondragon

This Mondragon principle, in practice, operates more closely to the Identity Statement principle of Member Economic Participation. I included it in this side road of the over all series because I believe that Mondragon presents a nuance all too often lost in the co-operative movement and, in the 'silo-ed' environment of the US worker co-operative movement, we often tend to forget the role of capital in our organizations is significantly different from that of our industry and capitalist competitors.

The role of capital in a worker co-operative should be two-fold:

1) ensure the on-going operations of the co-operative

2) allow the co-operative to maintain the highest level of safety and quality of work-life.

Thus, this principle presents the balancing act of worker co-operatives. As the opening quote suggests, if we are just in it for the money, what are we really trying to accomplish? However, DJMA has also said, “Cooperativism without the structural capacity to attract and assimilate capital at the level of the requirements of industrial productivity is but a temporary solution, an invalid formula.”

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Overcoming the Rift Between Worker Coops and the Labor Left

by Editors @ Monday, January 4th, 2010. Filed under Economic Democracy, Labor Movement

'Sovereignty of Labor:'

A Deeper Look at the

Mondragon Principles

A series on the core principles of

the Mondragon Cooperatives in Spain

By John McNamara

http://www.cooperativeconsult.com

The Mondragon principle “Sovereignty of Labor” created departure from the cooperative movement. While the Rochdale Pioneers had good intentions, they abandoned worker cooperation in the 1870’s. The Fabian Socialist moved even further from the ideals of Robert Owen declaring consumerism as the lowest common denominator for human relationships eschewing workers as merely another stakeholder group. Even the French cooperativist Charles Gide turned away from worker associations. Sadly, this act left the labor movement adrift from the cooperative world even as organizations such as the Industrial Workers of the World and the Congress of Industrial Organizations developed worldviews akin to the ideal of cooperation.

In the US, as in most of the Capitalist dominated world, the idea of labor being sovereign is almost non-existent. Business schools spend a lot of money teaching future managers how to manage workers—increase their productivity and the companies profits Except in the more enlightened firms, managers treat workers as errant children. Likewise, the dominant culture makes work something to be avoided and champions obstruction as “fighting the man”. People who do work hard tend to be treated as suck-ups and “upwardly mobile”. We mock the Ragged Dick stories in which “by luck and by pluck and good boy may succeed”. We have been conditioned to hate work and to distrust anyone who suggests that we work hard. The wobblies ran a cartoon called Blockhead who ridiculed the “company man”.

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Jobs Campaigns, New Deal History, National Service and Socialist Values

by Editors @ Tuesday, December 29th, 2009. Filed under Economic Democracy, Economy, Labor Movement, Organizing, Socialism

A Left Role, Renewed Identity,

and How-To, in Campaigns for

National Service Jobs Programs

 

By John Case

Socialist-Economics Group

 

Does the current crisis justify an expanded role for government as an employer of last result?

Consider the following facts from EPI research:

Number unemployed: 15.4 million (up from 7.5 million in December 2007) Portion of official unemployed considered structural: 3.9 million Portion of unemployed who have been jobless more than six months: 38.3% Total jobs lost during the recession: 8.0 million Jobs needed to return to pre-recession unemployment rate: 10.9 million Number of job-seekers per job opening: 6.1 Unemployment rate: 10.0% Underemployment rate: 17.2%; Share of workers un- or underemployed: more than 1 in 6 States with double-digit unemployment in October, 2009: 15 White unemployment: 9.3%; African-American unemployment: 15.6%; Hispanic unemployment:12.7% Manufacturing jobs lost since the start of the recession: 2.1 million (15.5% of sector's jobs) Construction jobs lost in the recession: 1.6 million (20.8%, nearly one in five construction jobs) Mass layoffs (50 or more people by a single employer) in October 2009: 2,127; jobs lost:217,182 Under- and unemployed, marginally attached and involuntary part-time workers: 26.9 million

Americans with no health insurance in 2008: 46.3 million Annual Social Security benefit for average retiree: $13,922; Share of older Americans receiving all their income from Social Security: more than 1 out of 4 Number of children in poverty in 2008: 14.1 million (over one-third) Drop in real median income from 2007 to 2008: 3.6% (largest one-year drop since 1967) Growth rate of nominal, hourly wages of production workers over the last three months:1.7% Additional people covered by Medicaid/SCHIP in 2008: 3 million

Not since the Great Depression has structural unemployment been so intense or sustained. Despite faster and smarter liquidity and fiscal efforts by government than occurred then, employment decline has merely decelerated 24 months into what is now dubbed 'The Great Recession'. It is not yet near enough to avert 5-10 years of unemployment rates above 6% (the level at which the 'Great Recession' started). The foundation of New Deal anti-depression actions, and one of the most successful and long lasting in its effects, was directly putting men to work in public works projects that became associated with several national service programs. The economist Hyman Minsky coined the term 'Employer of Last Resort' to describe government full employment efforts, which were part of his economic prescription, discussed more below, for countering capitalism's inherent vulnerability to financial instability.

This article explores the appropriateness, precedents and how-to's of national service programs (the chief US version of employer of last resort). in responding to the current crisis. The moral and social virtues of putting the unemployed to work in the creation of useful and meaningful public goods, instead of subjecting them to sustained idleness, should be self-evident.

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Mondragon, Solidarity Economy Get a Peek in Mainstream Media

by Editors @ Thursday, December 24th, 2009. Filed under Economic Democracy, Trade Unions

Photo: Coop Bakeries in California

In Cleveland,
Worker Co-Ops Look
to a Spanish Model

By Judith D. Schwartz
Time Magazine

Dec 22, 2009 - While officials, pundits and the everyday folks who have to pay bills lament unemployment rates that won't go down and wages that won't go up, some Rust Belt planners and union leaders are feeling optimistic: they're taking inspiration from the Basque region of Spain, where a network of worker-owned cooperatives launched amid the rubble of the Spanish Civil War has grown to become the country's seventh-largest corporation, and among its most profitable.

The Mondragon Corp. (MCC), based in northern Spain, is a multilayered business group with 256 independent companies (more than 100 of which are worker-owned cooperatives) that employs more than 100,000 people. It has long been legendary among scholars and activists seeking to bolster workers' rights. (See the top 10 everything of 2009.)

The Mondragon story began in 1941, when a Catholic priest, Jose Maria Arizmendiarrieta (often shortened to Arizmendi), found in the Basque town war-torn devastation where there had been a thriving manufacturing base. He opened a polytechnic school, which in 1956 spawned its first cooperative, a stove factory. Half a century later, the Mondragon enterprise encompasses firms making everything from machine tools to electronics to bicycles, along with a retail division, a university and a significant financial sector, with the large cooperative bank Caja Laboral at its core.

While many think of cooperatives as a small-scale hippie mainstay, the Mondragon Corp. is huge, hard-nosed business-wise and successful; in 2008, with Spain's economy in the doldrums, MCC's income rose 6%, to 16.8 billion euros. The Mondragon Corp. maintains its commitment to one-worker, one-vote democratic governance through a complex, carefully honed organizational structure in which the corporation serves as a kind of metacooperative for the individual companies. Through representatives and resources drawn from the larger network, it provides support for planning, research and generation funding for new businesses.

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Worker Co-ops: Green and Just Jobs You Can Own

by Editors @ Tuesday, December 22nd, 2009. Filed under Economic Democracy, Environment

 

A South Bronx Worker Co-op

Turns Trash into Treasure

 

By James Trimarco and Jill Bamburg

Yes! MagazineOmar Freilla wants to see worker co-ops, like ReBuilders Source, everywhere. ReBuilders Source, owned and operated by workers from the South Bronx, sells salvaged building materials that would otherwise be destined for a landfill. Photo by Erica McDonald for YES! Magazine


Photo: Omar Freilla wants to see worker co-ops, like ReBuilders Source, everywhere. ReBuilders Source, owned and operated by workers from the South Bronx, sells salvaged building materials that would otherwise be destined for a landfill. Photo by Erica McDonald for YES! Magazine

Difficult times call for creative strategies. Time and again during periods of economic hardship and market failure, cooperatively owned businesses have emerged as a democratic, grassroots, and DIY response. It happened during the economic upheavals of the 19th century and again during the Great Depression.

Today, as the current economic crisis deepens, co-ops are again coming to the fore as producers and consumers seek stable sources of employment, goods, and services. There are no easy numbers to quantify this growth, but signs of a new upsurge are becoming clearer. The farmer-owned agricultural cooperative Land O’Lakes, for instance, chalked up its strong performance in 2008 to its co-op status.

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Mondragon Staking Out a Foothold in the U.S.

by Editors @ Thursday, December 3rd, 2009. Filed under Economic Democracy, Organizing

Photo: Evergreen's Industrial Laundry Coop in Cleveland 

This Import

Might Preserve

American Jobs

By: Judith D. Schwartz

Miller-McCune Report

As the U.S. unemployment breaches the 10 percent mark — with manufacturing sector rates even higher — policymakers and industry representatives in the Midwest are seeking strategies to keep the Rust Belt from getting even rustier. In this war for economic survival, groups in cities like Cleveland, Detroit and Chicago, as well as the million-plus-members-strong United Steelworkers Union, have turned to a model borne of another war-torn region: the Mondragón Corporation in the Basque area of Spain.

The Mondragón Corporation (MCC) is a multilayered organization with worker-owned cooperatives and participatory governance at its core. The corporation is a group of cooperatives and cooperative members, a seat of governance as well as planning, researching and generating funding for new businesses — a kind of meta-cooperative.

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Steelworkers Aim at Job Creation with Worker-Owned Factories

by Editors @ Tuesday, November 3rd, 2009. Filed under Economic Democracy, Organizing, Socialism, Trade Unions

Photo: High-tech Machine Tools from MCC

‘One Worker, One Vote:'

US Steelworkers to Experiment

with Factory Ownership,

Mondragon Style


By Carl Davidson
SolidarityEconomy.net


Oct. 27, 2009--The United Steel Workers Union, North America's largest industrial trade union, announced a new collaboration with the world's largest worker-owned cooperative, Mondragon International, based in the Basque region of Spain.


News of the announcement spread rapidly throughout the communities of global justice activists, trade union militants, economic democracy and socialist organizers, green entrepreneurs and cooperative practitioners of all sorts. More than a few raised an eyebrow, but the overwhelming response was, "Terrific! How can we help?"
The vision behind the agreement is job creation, but with a new twist. Since government efforts were being stifled by the greed of financial speculators and private capital was more interested in cheap labor abroad, unions will take matters into their own hands, find willing partners, and create jobs themselves, but in sustainable businesses owned by the workers.

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Mondragon in the US: Background to the United Steel Workers Agreement

by Editors @ Sunday, November 1st, 2009. Filed under Economic Democracy, High Road Economics

Photo: High Tech Tools from

Mondragon headed for China

[Editor's Note: Written before the new collaboration between Mondragon and the United Steel Workers was announced, this article still gives some valuable background.]

Mondragon Cooperatives:

What Relevance for US

Cooperative Development?


By Bernard Marszalek

Oct.27, 2009 - A recent weeklong conference in Sonoma, California – The Economics of Peace – featured a day devoted to lectures and workshops on the cooperatives associated with the Mondragon Cooperative Corporation (MCC). This event marks the third occasion in the last six months where representatives from the MCC, located in the Basque region of Spain, appeared in the US. Previously both Cleveland and Detroit hosted discussions with the MCC. While US developers of worker cooperatives have toured the Mondragon complex since the 80’s, these recent visits are noteworthy as first for the MCC. 


In each case the MCC representatives were returning a visit from a US group, so we can’t presume that the frequency of visits will be maintained. Nonetheless the increased public exposure to the cooperative enterprises founded over 50 years ago in the city of Mondragon is significant. The raised profile of Mondragon in the US prompts some thoughts of MCC’s role within the worker community. I am hoping that the following comments, from someone with only a tangential relationship to co-op development (I consider myself an activist, not a “developer”) will generate a discussion about the future of worker cooperatives in a world that increasingly shows signs of complete collapse.

 
But let me begin noting the amazing success of an experiment (the term the MCC uses) begun by a poor parish priest over sixty years ago. Today, the MCC is a complex worth 24 billion dollars and employing 100,000 in 120 enterprises all over the globe. It comprises factories, banks, insurance agencies and a network of retail stores throughout Spain. Globally the MCC invests in industries located all over Europe, Latin America and Asia.

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Targeting the Main Enemy: Low-Road Finance Capital

by Editors @ Tuesday, October 13th, 2009. Filed under Economic Democracy, Economy, Financial Crisis

 The Dominance of the Financial

Sector has Become a Mortal Danger

to our Economic Security

 

 

By Robert Creamer
Huffington Post

Over the last several decades, the financial sector has grown relentlessly. It has doubled in size over the last 14 years. During the period 1973 to 1985 the financial sector never earned more than 16% of domestic profits. This decade, it has averaged 41% of all the profits earned by businesses in the U.S. In 1947 the financial sector represented only 2.5% of our gross domestic product. In 2006 it had risen to 8%. In other words, of every 12.5 dollars earned in the United States, one goes to the financial sector, much of which, let us recall, produces nothing.

That growth has not been among community or regional banks -- or credit unions. I'm talking about Wall Street.

Wall Street's growth is one big reason that most of America's economic growth during the last decade has flowed into the hands of investment bankers, stock traders and partners in firms like Goldman Sachs. The Center on Budget and Policy Priorities reports that fully two-thirds of all income gains during the last economic expansion (2002 to 2007) flowed to the top 1% of the population. And that, in turn, is one of the chief reasons why the median income for ordinary Americans actually dropped by $2,197 per year since 2000.

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