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Magazine Issue 7 - Spring 1998
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| So what's the alternative? - Co-operative Models of Economic Development It's called the TINA phenomenon: 'There Is No Alternative'. Roger Hallam of Upstart workers Co-op begs to differ... It's all very well you lot criticising us but I there's no alternative!" You can almost hear the triumphant tone in the businessman's voice as he unleashes his unanswerable battle- cry. Everyone remembers Mrs Thatcher's phrase "there's no alternative" and the same phrase seems to apply in today's world dominated by capitalist big business. With the "defeat" of communism and socialism as models of economic organisation it really does seem as if the question is settled. Certainly nasty things go on, but there's no other way of doing them. This is the ideological justification that sustains millions of people's sense of morality whilst they systematically organise the destruction of the environment and the uprooting of communities and their vulnerable local economies. And well, what have we to say in response? Nothing very impressive it seems. Maybe that's why for every ten people campaigning against the system there are only one or two looking at alternatives. Over 30 years after the emergence of a new radicalism in the 1960s, this record is not too good. No doubt this has shaken the confidence of new movements, limiting their ability to actually challenge capitialism as a system, rather than particular abuses. However it may come as a surprise that there are now more tried and tested alternative economic models in Europe and America than ever before. Many of these have been beavering away for a good few decades, ignoring the comings and goings of political fashions. As such they are, I believe, beginning to emerge from relative obscurity to challenge the mainstream - both as economic competitors and as unavoidable examples of alternative ways of doing things. This article presents a brief outline of three examples of living models of alternatives to mainstream business. All three are fully sustainable models of how social and economic lives can be organised. Although coming from differing cultural and economic backgrounds they display a number of basic similarities. They reveal the necessary foundations for a viable challenge to private enterprise and the possessive individualistic ethic that sustains it. Mondragon, which is the largest, was founded in the 1950s in the Basque area of Spain and is unique in many ways. It has grown in to a coniplex of interlocking co operatives, employing over 20,000 people in around 170 projects. It is perhaps the most subversive proof that a modern large scale economy can be run by workers themselves. The second example is the Media Group in Germany, which grew out of the radicalism of the late 1960s, and the movement to find a "Third Way" between private capitalism and state socialism. The group now has nine connected companies/charities involving around 500 people. Lastly we come to the UK, which since the demise of the co-operative wholesale movement earlier in the century, has fallen behind continental developments - despite a rapid increase in the growth of co-ops in the 1970s and 80s. However since the late 1980s a group called Radical Routes has been working at recreating the vision of a society of interconnected co-operative institutions. Radical routes facilitates the establishment of independent housing co-ops and workers' co-ops with an ethical/ecological focus. It is immediately obvious from these examples, and many others from around the world that the basic institutional alternative to the private company is the co-operative. This is the basic building block and reflects one of the fundamental criticisms of capitalism - that workers are treated as just another "factor of production" along with raw materials and machinery, to be used in such a way as to maximise return on capital. Any alternative to capitalism has to deal with the absurdity of this model. Workers are first of all human beings, and in a fundamental way are involved in the making of the product. Therefore workers must have the right to participate in the decision making process. All three models: Mondragon, the Media group and Radical Routes, have this characteristic of worker-control in common. This far exceeds 'nice capitalist' consultation exercises because there is real legal power. In one of the Media group's companies a manager was recently sacked by his workers - not the sort of thing you hear about at British Airways! In Mondragon the companies are owned by the workers. Managers are answerable to them, and while the managers have operational control it is the workers who decide the direction and set the limits. In Radical Routes co-ops the legal situation is the same. Houses are controlled by the tenants because they are members of the co-operative which owns the house. In workers co-ops the business is owned by the employees who are members of the company. In all three examples all the workers have equal power, usually by having one vote each in any decision-making process. However this does not mean that everyone does the same things, earns the same or mechanically rotates jQbs according to some simplistic egalitarianism. Such arrangements have not only failed but also shown themselves to be just as alienating to the human spirit of freedom and creativity as the capitalist model. For example, it is recognised in the Media group that there is nothing intrinsically wrong with '~enterprising capabilities". Drawing upon the ideas of Rudolf Steiner, the group sees these entrepeneurial drives as no different than the impulse for creativity and art. However, the crucial point is made that such talents and the need for their expression are in no way necessarily connected to the ownership of capital. The challenge that these examples present to the capitalist world will no doubt increase with time as the ecological and social contradictions of unconstrained capitalist growth continue. Just because I love making computers doesn't mean I should be paid on the arbitrary basis of what the market will pay for my labour. While enterprise is in the 'sphere of freedom", pay is in the "legal sphere" which should be determined by democracy - by your needs relative to those of others. While the Media group uses a particular languge, the basic ideas are also reflected in Mondragon where there is profit sharing across co-ops, and Radical Routes, where there is a limit on personal income. So how are the profits distributed? In a normal modern capitalist company the money is largely distributed to institutional shareholders who will buy more shares only on the reductionist criteria of yearly (and, increasingly, quarterly) profit figures. There is enormous violence in trying to squash such a complex social phenomenon as a business, intimately interconnected with other environmental and human systems, into the straight-jacket of maximuin monetary gain. Even the more enlightened capitalist thinkers of New Labour are aware of how "short termism" in the economy can undermine future prosperity - even conventionally defined. Managers of companies are tied to getting large and quick profits rather that opting for long-term investment which will ensure sustainability in the years to come. But beyond the superficial tinkering of New Labour is the fundamental political issue of how the profits are used in relation to three important groups - the workers in the companies, the local and regional communities in which the company operates, and last but not least the wider natural environment on whose long-term health all economic activity depends. Given the crucial importance of this question, the three groups give a great deal of time and energy to working out the allocation of collectively produced resources. This is a democratic process. The Media group have yearly jamborees. Radical Routes' co-ops meet up once a quarter and representatives from each member co-op are instructed by their co-ops to inform the gatherings of their views. No decision-making happens at the gatherings as proposals must be agreed at local co-op level. Mondragon has been known to hire football stadiums for its general meetings! In other words there is a genuine level of participatory democracy in all these groups. This not only ensures that there is a lot of input into decisions - so that once they are made they are likely to be good - but also that through actually being involved in the decision making process, people feel more as if they own the results. So where do the profits go? Not to shareholders, that's for sure. All three groups are autonomous not just of shareholders but also of other private companies and of interfering government agencies. In the Media group, there is what is called the "neutral administration of capital", which means that the profits no longer belong to any particular group/business, and are therefore not biased. The group redistributes the money it makes (where ever it is) to the companies where necessary and as the particular need for sustainability requires. The rest is used for non-profit making projects of a political or cultural nature. For example the group has a charity which is involved in a number of communities in Romania, enabling them to take control of their economic affairs by settirig up new shops and businesses. In Mondragon, funds are put aside for the workers' pensions, and over the years money has been used to create an impressive number of supporting institutions. These include housing co-ops for workers, a co-operative training college and a social security system. Being located in a small geographical environment around the town of Mondragon, the group has effectively created a viable co-operative community. independent from the state and from multinational penetration. As such it serves as an amazing model of how local communities can start to regain their power and autonomy from the arbitrary swings and roundabouts of international capital movements. In Radical Routes there is an explicit commitment on the part of the co-ops to an ecological consciousness and socially useful activity. Only co-ops putting such principles into practice are able to join the group. All co ops give payments to the "secondary co-op as it is called and this money is used in part to publicise how more people can set up co ops. Within the co-ops themselves personal income is limited so that money made over and above the individual's needs can be used to buy collective resources, thus providing housing and jobs for others. In this way Radical Routes is reclaiming the old nineteenth century notion of mutual aid: the principle that people shoult help others on the assurance that once helped these people will help others in turn. This is not just an expectation in Radical Routes - is built into the structure and made explici in the rules of membership. The three groups then have two realms ir which they fundamentally contrast witl conventional capitalist companies. Internall~ they are democratic, the involvement of th( workers is real and they have formal power Externally they are socially aware. They ar~ not merely making money for the short tern greed of shareholders. Money is madt available for helping others in their own an~ other communities. The business is seen a'. much as a social entity as an economic ont and therefore it has social responsibilities. As constituted these groups form a ve~ real challenge to the assertion at the heginnin~ of this article that there is no alternative The alternative is real, it exists here and now and it's growing! Some from the extreme lefi will of course criticise the entities from r utopian perspective. We are not dealing hert with total communism anarchism. Experiments in both have beer found to be highly contradictory ir their outcomes and have collapsed as a result. The examples here do in fact show how close we can come to these ideals by not pushing them to abstract limits. There is here a real sense of social solidarity and political participation. These are the values a post-capitalist society needs to build upon. That said, as with any actually existing social phenomenon, there are problems. Mondragon for instance seems to have little ecological consciousness and in all the groups there are perennial conflicts about the balance of powers between different priorities and groups. But these are not utopian models and do not aim to have the "final answer". They are all products of historical and cultural contexts, and other forms will no doubt need to be created in time to challenge then, and to respond more effectively to new environmental and technological developments - the most obvious presently being the ecological consequences of unlimited economic "growth". However they also challenge the new social and political movements which have grown up in the last thirty years. Most fundamentally they show what can and must be achieved through a willingness to co operate - if we put aside our egos, short term interests and particular values, in order to build social networks and groupings which in time can provide the institutional forms for a sane society. Co-operation is not just another option. All these groups significantly bring co-ups together, and use this synergy to create their own banking functions - thereby raising their own capital this allows them not only to survive, but also to fight back in a hostile capitalist environment. Like the old socialists in the nineteenth century used to say: 'Unity is strength". |