Worker-Owned Co-ops: Bernie's Platform Plank No One is Talking About

[99th_Monkey]

Last edited Mon Sep 28, 2015, 09:40 PM - Edit history (1)

Bernie Sanders Has One Socialist Agenda Item On His Platform That No One Is Talking About
by JOE FLETCHER * Addicting Info * September 27, 2015

Bernie Sanders’ self-identification as a “Democratic Socialist” has been the subject of much discussion. People in the United States are not particularly fond of the word “Socialist.” In 2011, Pew released a survey that found that only 31% of people feel positive to the term. Millennials had the most favorable opinion of the term Socialism, with 49% reporting positive feelings towards the term.

Now, there is huge difference between Socialism and Democratic Socialism. A contemporary Democratic Socialist is very much still a Capitalist, though they favor strong social welfare programs that aim to reduce economic inequality and favor regulations that curb the worst behaviors of the private sector. A Democratic Socialist is essentially nothing more than a left of left-of-center Liberal.

Socialism encompasses many varying schools of thought on how to achieve Socialism. However, all Socialists share the same broad goal of creating an economy where the workers collectively own and run their workplace. No matter how many well-intentioned memes or viral videos you might have seen that attempt to de-mystify the word Socialist, by describing things such as public roads, food stamps, public housing, or the postal service as features of a Socialist society, they are ultimately false. Those things are still the trademarks of a Liberal Capitalist society.

Now that being said, there is one truly Socialist agenda item in Sanders economic platform, that no one is talking about – building worker co-ops. Sanders introduced legislation with the aim of helping to build worker owned businesses in 2014. In press release Sanders stated:

“At a time when corporate America is outsourcing millions of decent-paying jobs overseas and with the economy continuing to struggle to create jobs that pay a livable wage, we need to expand economic models that help the middle-class. I strongly believe that employee ownership is one of those models. ”

http://www.addictinginfo.org/2015/09/27/bernie-co-op/

[Armstead]

1. There is a whole and multifacetd movement aound variations of this

There are many peope and groups working to advance concepts like local economics, economic decentralization, "small is beaurful" co-operative, worker-owned enterprises, etc.

They take many forms but that have one thing in common. They are designed to diffuse the concentration of centralized corporate power and massive scale that the modern economy is based on.

We'll never be able to go completely backward, but the more power and wealth are diffused, and the more we return to human and community scales of activity, the better.

[99th_Monkey]

2. Abso-fucking-lutely! Democracy in the workplace baby.

I studied worker co-ops in grad school, and it was very eye-opening.

Worker ownership not only democratizes the workplace, empowering workers to hire their CEO's (and fire them)
at-will; it also anchors capital and jobs into local economies, such that plants & workplaces are not subject to
the whims of distant corporate board-rooms motivated only by maximizing profit margins (compared to other possible
investments). In addition, the profits earned by workers (not profit-hungry investors) stay in their host community to turn over (the multiplier effect), rather than being syphoned off to distant corporate headquarters.

Interestingly, the US labor movement during the 1800's was ALL about worker-owned cooperatives, rather than
collective bargaining, which didn't appear until after the turn of the century.

[Maedhros]

3. Employee ownership: a win-win for labor and management :) [n/t]

[kimbutgar]

4. We have a worked owned co-op grocery store in San Francisco called Rainbow grocery

The times I have gone, the place is crowded and long lines at the cash register. If you are looking for a particular item there is someone there to help you find it. There is little employee turnover and unlike going into Safeway or lucky the workers appear happy.

[brooklynite]

5. Um, who's stopping anyone from starting a worker-owned Company today?

[closeupready]

7. Agree. The tone of the question seems to imply this is a radical idea.

It's not. United Airlines, for example, is/was worker owned, and that was what, 10 years ago, during a Republican administration.

So, why is this plank a big deal?

[99th_Monkey]

11. It's only a 'big deal' if you care about job retention/security and anchoring capital into local communities.

where profits stay in local economy to turn-over and multiply, rather than being syphoned off to distant corporate headquarters.

These are important, yet under-appreciated features of worker-owned companies.

[rogerashton]

28. UA as 55% owned by an ESOP

but was not a worker cooperative, a different thing.

https://www.nceo.org/observations-employee-ownership/c/united-airlines-esops-employee-ownership

further,

Advocates of employee stock ownership plans, or ESOPs, point out that United’s plan was not typical of most employee-ownership situations and was probably doomed from the start. It was a strategy of convenience for United’s management and its various labor groups, each of which had a different idea about what “employee ownership” meant. Indeed, a majority of the company’s workers — its flight attendants and its nonunion employees — were never even part of the plan.

http://www.salon.com/2002/12/12/esop/

[Ron Green]

8. It's difficult, because conventional exploitive capitalism tends to drive out worker-directed

enterprises. This is where government can help with incentives and tax policies that allow more egalitarian companies to flourish until they're more conventionally competitive. It's a balancing act, but so is most good policy.

[99th_Monkey]

12. Exactly. Thank you. nt

[99th_Monkey]

9. It's called TAX (& other) INCENTIVES ... for worker-owned enterprises

Also, gov't programs would provide technical assistance for both worker buy-outs and start-ups.

Move away from big tax breaks for billionaire-owned corporations, shift those to focus worker-owned
companies.

BTW - Burlington Vermont already has one of the highest concentrations of worker-owned businesses
in the country. Bernie practices what he preaches, and he knows what he's taking about.

[Armstead]

14. No one -- But it's an example of economics for people that gets ignored too often

Not all of life has to be viewed through the screen of political hostility.

The fact that Sanders has long been an active supporter of alternative systems that have to potential to encourage economics that actually benefit workers is a good thing.

[Cheese Sandwich]

16. Um... ain't got no money

Sanders' plan would provide funding and guidance.

[MineralMan]

6. We just had a Hi-Vee supermarket open near me.

Those stores are employee-owned, at least to some degree. I haven't visited the store yet, since it's still crowded with lookie-lous trying to scope it out. I will be shopping there, though.

Employee-owned enterprises are perfectly legal in the US. There are quite a few of them, in fact. There could be more. Hi-Vee is a popular Midwestern chain, with heavy penetration in Iowa, and growing in other states.

There are no bars against employee-ownership of businesses.

[99th_Monkey]

10. Please see post # 9 up-string

Yes, they are legal, and more importantly they solidly anchor both capital and jobs into local economies, such that plants & workplaces are not subject to the whims of distant corporate board-rooms motivated only by maximizing profit margins (compared to other possible investments). In addition, the profits earned by workers (not profit-hungry investors) stay in their host community to turn over (the multiplier effect), rather than being syphoned off to distant corporate headquarters.

Post 9 talks about ways to encourage co-ops & other worker-owned enterprises.

[liberal_at_heart]

13. I love this idea. I have a feeling this will be yet another example of an idea that

opponents will call communist but that the majority of Americans would support just like they support a $15/hr minimum wage and Medicare for All.

[beam me up scottie]

15. K & R

[Motown_Johnny]

17. Are worker co-ops really Socialist?

Socialism usually describes the government owning and running businesses.

This seems like more of an expansion on a business partnership arrangement than Socialism to me. It is still private ownership, it is just owned by a larger number of people. Kind of like they all own stock in the company, but earn that stock with their own hard work.




http://www.merriam-webster.com/dictionary/socialism

^snip^

socialism noun so·cial·ism \ˈsō-shə-ˌli-zəm\

: a way of organizing a society in which major industries are owned and controlled by the government rather than by individual people and companies


Full Definition of SOCIALISM

1: any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods

2 a : a system of society or group living in which there is no private property
b : a system or condition of society in which the means of production are owned and controlled by the state

3: a stage of society in Marxist theory transitional between capitalism and communism and distinguished by unequal distribution of goods and pay according to work done

[99th_Monkey]

19. Good questions.

I think you are partially right, that the strictest definitions of socialism generally imply government ownership of means of production. But not necessarily. That definition in your post includes "collective .. ownership" as well, which would include worker-owned co-ops. But you are right, if you only say "socialist" the term generally connotates some form of state ownership.

Interestingly, the origins of the US labor movement during the 1800s was ALL about worker-owned co-ops, until near the turn of the century when collective bargaining was adopted labor's dominant motif.
http://www.truth-out.org/opinion/item/14076-cooperatives-and-community-work-are-part-of-american-dna

Also, there is a massive network of inter-related co-operatives in the Basque region of Spain, known as Mondragon, which serves as a global 'demonstration project' of sorts, showing how co-ops can be collaboratively formed across different sectors of the business community, from factories, to banks, to child care centers, and much more.
http://www.counterpunch.org/2014/04/30/the-case-of-mondragon/
https://en.wikipedia.org/wiki/Mondragon_Corporation

Of course, Bernie describes himself as a Democratic Socialist, not a socialist in the state-owned business sense of the word. And, so it's not too surprising that one of the largest concentrations of co-ops in the US is located in Burlington Vermont.

Bernie knows what he's talking about on this issue, like he usually does. There should be a much more prominent place for worker-owned business in the US economy, and Bernie is committed to helping that become a reality as POTUS.

[Motown_Johnny]

25. collective ownership is not necessarily Socialist

It can be argued that stockholders own the businesses that they own stock in. Isn't that a former of collective ownership?

What about family owned businesses? Doesn't a collective own it? Is that really Socialist? Or even a partnership with multiple partners? If so I think a lot of lawyers are in for a surprise.

Socialism most commonly refers to some forms of government owning the business. I don't think that the collective ownership mentioned in the OP fits that definition, but that is just my opinion.

[99th_Monkey]

27. I think that's why we have different words for this stuff

collective, cooperative, family-owned, employee stock ownership plan (ESOP), partnership, stock-holders, etc.

They all mean somewhat different things. The word collective is often used as a moniker for some
form of communal or shared ownership:

Collectives are sometimes characterised by attempts to share and exercise political and social power and to make decisions on a consensus-driven and egalitarian basis.

A commune or intentional community, which may also be known as a "collective household", is a group of people who live together in some kind of dwelling or residence, or in some other arrangement (e.g. sharing land). Collective households may be organized for a specific purpose (e.g. relating to business, parenting, or some other shared interest).

An artist collective is typically a collection of individuals with similar interests in producing and documenting art as a group. These groups are often composed of friends or friends of friends from all walks of life with different beliefs, careers, & religions, and can range in size from a few people to thousands of members.[citation needed] The style of art produced can have vast differences. Motivations can be for a common cause or individually motivated purposes. Some collectives are simply people who enjoy painting with someone else and have no other goals or motivations for forming their collective.[citation needed]

A work collective is a type of horizontal collectivism wherein a business functions as a partnership of individual professionals, recognizing them as equals and rewarding them for their expertise. The working collective aims to reduce costs to clients while maintaining healthy rewards for participating partners. This is accomplished by eliminating the operating costs that are needed to support levels of management.[1]

https://en.wikipedia.org/wiki/Collective

I'm not sure what point you are trying to make.

[Motown_Johnny]

31. My point being...

...that a portion of the OP was not accurate

Socialism encompasses many varying schools of thought on how to achieve Socialism. However, all Socialists share the same broad goal of creating an economy where the workers collectively own and run their workplace.


Unless I am simply misunderstanding it, this seems to imply that the collective ownership Sanders was trying to stimulate would be Socialist. I was just trying to clear up something that seemed inaccurate to me.

[PotatoChip]

29. Here is part of a Q&A interview of Economic Prof. Richard Wolff regarding Co-ops.

His website, 'Democracy at Work' (link below) has further information in case you are interested.

Mark Karlin: Refreshingly, you offer a key alternative to capitalism in decline. You promote Workers' Self-Directed Enterprises (WSDE) in Part III of your book. What would be a succinct description of a WSDE?

Richard Wolff: Quite simply, a WSDE entails the workers who make whatever a corporation sells also functioning - collectively and democratically - as their own board of directors. WSDEs thereby abolish the capitalist differentiation and opposition of surplus producers versus surplus appropriators. Instead, the workers themselves cooperatively run their own enterprise, thereby bringing democracy inside the enterprise where capitalism had long excluded it.

Mark Karlin: In your sixth chapter, you contrast WSDEs with worker-owned enterprises, worker-managed enterprises and cooperatives. What are the primary differences?

Richard Wolff: Workers have a long history of multiple kinds of cooperatives. That is, workers can cooperatively own (e.g. their pension fund holds shares in the company that employs them), buy (e.g. the many food coops around the country), sell (e.g. grape growers who combine to market their outputs), and manage (e.g. workers take turns supervising themselves). All such cooperatives can and often do co-exist with a capitalist organization of production in the precise sense of workers being excluded from the decisions of what, how and where to produce and what to do with the profits. What makes WSDEs unique is precisely that they are about cooperative production, about ending the capitalist division of producers from appropriators of the surplus, and replacing it with democratic cooperative decisions governing production and the social use of its fruits.

http://www.rdwolff.com/content/democracy-work-cure-capitalism

[ljm2002]

22. That's why Bernie is a Democratic Socialist...

...rather than just a Socialist. Pure socialism, as you describe it, where the government own all the businesses and means of production, is not a good idea, as has been demonstrated by those countries that practiced it. Pure centrally controlled economies are full of perverse incentives, encouraging the development of an elite who operate within the government to enrich themselves while preventing the population from being able to better their own lot through their own efforts. They stifle creative individual activity and ultimately impoverish the masses -- at least that is what history has shown to date.

However, that does not mean that government should not have a role in parts of the economy. Sometimes nationalizing an industry works to the advantage of the population and prevents private enterprise from taking a country's resources without compensating its people appropriately. Also, governments can and should set a minimum standard of living. Certainly in this day and age, when we are able to provide enough for the needs of all, it would be helpful to ensure that everyone has a roof over their heads and enough to eat -- and it would be less costly, both socially and monetarily, to do so than what we do now in this country, IMO.

We need to quit thinking in totally either-or terms. The reality of our collective existence must be recognized if we are to act appropriately on issues like climate change, for example. But there is also the reality of respecting individuals and their rights and abilities which we also must do if we are to have a just society and also to realize our creative potential.

We cannot trample on the rights of the individual, nor prevent individuals from private enterprise; but we also cannot promote the rights of the individual to the point that it overrides our collective well-being. There is a balance to be struck.

[Armstead]

34. Socialism has aquired a much broader and more multifaceted meaning

Just like "capitalism" is used to describe many ways of doing business, some of then contradictory. Socialism basically has come to also mean methods of ensuring that economic activity (capitalist or otherwise) is based on social benefits at least as much as on the profit motive.

[jwirr]

18. Nothing un-American about this idea. Keeps the business in

our own country.

[99th_Monkey]

20. Absolutely. Worker-owners aren't very likely to vote to outsource their own jobs.

and it keeps capital anchored into local economies, with the profit margin staying to turn over in local economy, rather than getting syphoned off to distant corporate hdqrs.

[jwirr]

21. Anyone say Glass-Steagall?

[Uncle Joe]

23. Kicked and recommended.

Thanks for the thread, 99th_Monkey.

[99th_Monkey]

24. Yur welcome Uncle Joe.. nt

[Hortensis]

26. What problem with free citizens building themselves some coops?

I don't care if anyone encourages that. Walmart's hardly going to run scared.

Now seizing businesses for conversion would be a different matter, but no one's suggesting that.

[99th_Monkey]

30. Far from being a "problem"

I think it's a great way to rebuild capitalism from the grass-roots up, to democratize the
workplace, and anchor capital and jobs permanently into local host communities.

Professor Richard D. Wolff has written and lectured extensively on the subject. I hope
he becomes Bernie's Sec. of Commerce, or some such.
http://www.rdwolff.com/content/democracy-work-cure-capitalism

You can google his name, and see many of his lectures on youtube.

[Hortensis]

32. Well, coops aren't new and haven't rebuilt capitalism yet; but they are a form

of business organization, and any of the assistances governments give to startups, especially small businesses, should be available to coops too, tailored as needed of course. Doesn't exactly seem revolutionary to me.

Hey, conservatives: Nothing to be afraid of here.

[99th_Monkey]

33. You are right, of course. Co-ops are nothing new.

In fact the US labor movement during the 1800s was ALL about worker-owned cooperatives,
until the turn of the century when labor opted for the collective bargaining motif.

And you right also that providing tax incentives and professional technical assistance for
worker buy-outs and start-ups, are the keys to effectively encouraging the grass-roots
democratization of workplaces and our economy.

I love that Bernie is onto this.

[Hortensis]

35. Me too.

[rogerashton]

37. cooperatives

"producer cooperatives" are eligible for Small Business Administration section 7(a) loan program participation, but other cooperatives are not. see https://www.sba.gov/content/7a-loan-program-eligibility
I think the eligibility of "producer cooperatives" is relatively recent.

[rogerashton]

36. Some ambiguity

Worker ownership can mean

1) A worker cooperative -- a company owned and run by an group of employees and governed by them on a basis of one member, one vote. While membership must be open to all employees (1), it is often the case that there are employees who are not members. Profits, if any, are distributed among the members in some proportion to work or wage earnings, as a "patronage dividend."

There are two important restraints to the formation of worker cooperatives. One, as noted in other posts, is lack of capital, and Bernie's proposal speaks to that. The other is ignorance. Truth is, it takes some very knowledgeable members to get a coop up and going. Nevertheless, there is a large and rapidly growing sector of worker coops in this country, though it is little known. (2) (3)

2) An Employee Stock Ownership Plan, ESOP. This is a case in which employees own shares through a trust that is usually financed by profit-sharing. (4) (5) As a rule the shares are not voted by the employees but by the trustees, who commonly are the managers. While ESOPs often include all full-time employees, there are exceptions, in which the ownership is limited to unionized, professional, or managerial employees. Some time back there were suggestions that Hillary would make increased support for ESOPS part of her platform (6) but nothing recently.

Both forms clearly have flaws. There are proposals to democratize ESOPS by allowing the employees to vote the shares. (7) An employee ownership bank such as Bernie has proposed might require worker coops, as a condition of the loan, to open participation in governance to all employees, whether or not "members" of the coop. But there could be complications in that, if there is a buy-in for membership, as there sometimes is. A sort of hybrid of ESOPS and coops might be found. Some nonprofits may provide yet another model for workplace democracy -- without actual worker ownership, nor indeed ownership in any meaningful sense. (8)

[99th_Monkey]

38. Right On!

I did my graduate thesis on worker ownership during the late 80s, so
am aware of ESOPS, and some of the trade-offs there, with only nominal
(if any) actual worker participation in company decision making, etc.

I absolutely LOVE your links. Thank you so much. It's great to see how
employee ownership has been proliferating, quietly, gradually, over the
past several decades.

And yes, absolutely the two main barriers are capital and good technical
assistance; both of which can be provided (along with tax incentives) to
really create a groundswell of grass-roots conversions, buy-outs and new
start-ups.

I hope Bernie appoints Richard Wolff as our next Secretary of Commerce:

Thanks so much for your post.

[moondust]

39. Catalonia has over 5000 coops,

in broad terms one in five of the total for Spain, and although they are predominantly small ventures (on average, employing about seven staff), they operate in many sectors, especially services and construction, but also in industry and agriculture.

http://www.theguardian.com/social-enterprise-network/2012/mar/12/cooperatives-spain-mondragon

Maybe you're familiar with Mondragon in Basque country. Probably some lessons to be learned from the ventures in Spain.

[Cheese Sandwich]

40. I love that Bernie Sanders talks about this.

I'm just going to drop a bunch of names.

WSDEs, Richard Wolff, Gar Alperovitz, Evergreen Co-ops Cleveland, Mondragon, Pluralist Commonwealth, Argentina recovered factory movement, The Take.


The biggest reason I support Bernie Sanders is because he opens the door for this movement to grow.

[99th_Monkey]

41. I love it too. It's so long overdue ... and ..

The time may be just ripe enough at long last, for a robust grass-roots uprising of workers eager
to engage in their work as co-owners of their enterprise. I've posted several times in the past on
DU about worker-owned enterprises, as a way to anchor both capital and jobs into local host
communities, but the response was very minimal, at best. This string got a lot more attention, so
maybe this being part of Bernie's platform for the Presidency is just the thing to kick-start a huge
shift in this direction, whether he ends up winning or not.

I'm very aware of Wolff and Mondragon, as I cite and link to both up-string .. less so of Alperovitz.
Not so much of Evergreen, Pluralist, or Argentina or Take. Employee ownership was the subject of
my graduate thesis during the 80s, and Mondragon was a huge inspiration to me, and informed my
research a lot.

This is such a HUGE bonus for me, in supporting Sanders. I totally would have supported him anyway,
in fact, I didn't even know about this until I'd already jumped on board; then I see it right there in print
when I go to his economic platform, KA-BOOM!

[Cheese Sandwich]

42. That's cool

I'm interested in that topic too. You can google for most of those terms. The Take is the Naomi Klein movie. It's in English and Spanish but supposedly you can turn on English subtitles.

I try to remember too that even if Sanders gets elected, that's when we really have to get to work, because that's like the opening shot of the thing, not the real goal. We still will have to fight and claw to get nice things. But at least we'll have an ally in the president, which should help a lot.

[Live and Learn]

43. No, problem here. nt