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"Economic Democracy" means Capital is subservient to Labor.

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JanMichael Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Aug-31-03 10:26 PM
Original message
"Economic Democracy" means Capital is subservient to Labor.
Edited on Sun Aug-31-03 10:28 PM by JanMichael
As in the idea that commerce exists to help the Human condition improve and not to dominate the People (I was asked what this meant in another thread.). Well my working example is the Mondragon Cooperative, that's what I mean by "Economic Democracy".

http://www.mondragon.mcc.es/ingles/mcc.html

Go ahead, look up "Mondragon Collective" and there are dozens of articles on the net.

IMO this is what large corporations should look like.

I was asked what "fairness and equality" have to do with economics.

The above example shows how it can be done.
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JanMichael Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Aug-31-03 10:58 PM
Response to Original message
1. Kick you sleppy (typo but it sounds nice) Workers!
:kick:
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Misinformed01 Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Aug-31-03 11:27 PM
Response to Original message
2. Don't bother to click on that link: Anne Coulter
did not comment on it, therefore DUers do not give a shit.
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camero Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 12:38 AM
Response to Original message
3. It's a good site
Edited on Mon Sep-01-03 12:39 AM by camero
Or it could mean that labor creates capital and therefore should be below labor.

One question, I couldn't find out though. Do people also live on the cooperative?

Here's another good site that talks about economic democracy.
www.prout.org

edit: for typo
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kodi Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 01:24 AM
Response to Original message
4.  it's just another name for socialism.
we have to do better than that in coining catchy phrases for the "cause," or the rhetorical war is already lost.

The normal and proper aim of the corporate community is to make money for its managers and for the owners of business, all the better if its members also contribute to the general prosperity. However, business acts on the prevailing business philosophy, which claims that corporate self-interest eventually produces the general interest.

you will have to show that this way is not only wrong for some, but wrong for most.

Classical political thought says that the purpose of government is to do justice for its citizens. Part of this obligation is to foster conditions in which wealth is produced. The obligation is not met by substituting the wealth-producer for the government.

but until a real delineation of this "obligation" gap and its negative effect on the country can be expressed so most people can understand it at this level, all they will hear is "socialism."

perhaps focusing on what government does right in comparison to what capitalism does wrong would be a place to start, perhaps not.
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camero Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 01:28 AM
Response to Reply #4
5. one difference
In the co-op, the boss or "owner" is ELECTED. So tell me how this gets in the way of the "proper" function of business.
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kodi Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 01:47 AM
Response to Reply #5
6. in the $10 trillion US economy how much is generated by co-ops?
you are using as an example, viz., US based co-ops that generate just what? probably less than that generated by macdonalds when selling french fries, (excuse me, freedom fries.)

you might as well demand that the american business community convert over to wind power as use co-ops as bona fide examples for proper corporate structure.

i dont want to insult you, because you obviously have a good heart, but using a co-op structure as model for most businesses is like using the physiology of a gnat as a model for the structure of an elephant.

and just to let you know, i consider myself a liberarian socialist, but not before i consider myself a realist and pragmatist.
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camero Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 01:56 AM
Response to Reply #6
7. it's ok. I'm not insulted
Edited on Mon Sep-01-03 01:58 AM by camero
But it is one way to get to economic democracy. They are still in thier infancy.

The point I was trying to make was when people hear the fact that a boss is elected, it would not sound so "socialist". It would appear more democratic.

The hard part is the change, but co-ops could compete with regular businesses if more people knew about them.

Myself, I think that very generous tax breaks for employee-owned corporations is the way to go.

Edit: another idea. Set aside a certain percentage of Small Business loans for employee-owned corporations.
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htuttle Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:03 AM
Response to Reply #7
9. Coops can compete with other businesses right now
Coops DON'T need any help from the government.

They are already out there, proving themselves to be a more efficient model for a business -- Unless, that is, unless your idea of a business is something that will funnel the money to a sharp point at the top.

But as far as providing good jobs, and essential goods and services, they can't be beat. All it takes is a group of motivated workers who are willing to pool their resources and get things going.

Honest to God, regular banks will even lend you money to do so. Really, I've done it myself -- it's the same with getting any other business loan.

Coops are not some pie in the sky idea. They just don't teach much about it in business school (but they DO often teach about them in Ag school -- go figure...).



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camero Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:08 AM
Response to Reply #9
10. Sorry
The last co-op I saw was a grocery store in the 70s in Baltimore.
I know they can work but the government could help workplace democracy by helping to get people started just as they help some minorities to get started.

As a matter of fact, that site was the first time I saw a co-op as a factory.
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htuttle Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 01:56 AM
Response to Reply #6
8. Millions of people work at cooperative businesses
Edited on Mon Sep-01-03 02:07 AM by htuttle
Myself included.

There are coops running everything from transportation companies to janitorial companies, to engineering firms, to bicycle and textile factories, to food wholesalers and grocery stores. And that doesn't even scratch the surface of producer and consumer coops in agriculture.

Your comments indicate to me that you come from a position of deep ignorance on the subject.

"Realistically", the coop I work at grossed over $4 million last year. "Pragmatically", we all made good money and we didn't have to deal with any pointy-headed assholes as bosses (no offense).
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kodi Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 09:36 AM
Response to Reply #8
13. please dont infer that i am ignorant. its not fair of you to claim that.
i do understand the value of co-ops to their workers. i volunteer at a food bank and while they are not actually co-ops, i know their value to people.

but the issue is using the co-op model of "economic democracy" for a transformation of current business philosophies, and i asked quite clearly if someone could put a number on the actual amount of commerce they do in dollars so it would be possible to access the effectiveness of such a model in a $10 Tillion economy.

instead of any legitimate response to this question, i have been accused of being ignorant, which IS ripe, since my own small business IS run like a co-op, vis a vis profit sharing where my two buddies who work with me each receive one quarter of our profits, with 25% of it reinvested in the company so we can garner even more business. since i had the original ideas, invested personally the capital necessary for the business, and have the contacts at the point of sales, i have final say so to make the business decisions. my friends recognize that i have greater ability to make these decisions, but even if they did not, it would not change the reality of the situation where i know how to sell the stuff and they don't, and that they, not i are more easily replacable by other workers.

one should perhaps recognize that in the US about 65% of workers are employed in companies that have 200 or more workers. with this, and the fact that the workplace is increasingly specialized, how can such beasts be tamed simply by the employees voting for the managers when the workers can rarely make informed decisions based upon the economic realities of the marketplace. all one gets from this is an employee popularity contest, which is not the most effective way to generate profits, promote long-term corporate stability, and employment opportunities for the employees.

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MMT Donating Member (135 posts) Send PM | Profile | Ignore Mon Sep-01-03 09:40 AM
Response to Reply #6
15. About $130 billion by 100 of the largest co-ops (2001 data)
Edited on Mon Sep-01-03 09:43 AM by MMT
(http://www.co-op100.com/homepage/coop100.nsf/index2002.htm?openpage&link=docname/welcomedoc.htm)

And there are thousands of co-ops.

McDonalds should gross about $40 billion world-wide in 2003, for everything. (http://www.mcdonalds.com/corporate/press/financial/2003/07292003/index.html)

Does that help?

=Meg
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Merlin Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 10:33 AM
Response to Reply #15
19. This is bogus. See my post below.
These companies are not employee cooperatives.
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MMT Donating Member (135 posts) Send PM | Profile | Ignore Mon Sep-01-03 01:24 PM
Response to Reply #19
35. Who says they have to be?
Co-operatives take many forms. The key factor is that they share out the ownership and the profit.
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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 10:13 AM
Response to Reply #5
16. Easy
The fact that the boss is elected inhibits the expansion of a business.
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WhoCountsTheVotes Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 12:59 PM
Response to Reply #16
33. how so? Directors are elected now, and they elect the CEO
Directors to a corporate board are usually elected by the shareholders, in a one-share one-vote election (as opposed to a democratic one-person one-vote election). The directors elect the CEO and sometimes other officers.

"The fact that the boss is elected inhibits the expansion of a business."

How so?

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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 01:34 PM
Response to Reply #33
36. Example
Let's say that my wife an I open up a business. We work hard for five years and do very well. Now its time to expand our business, but we are reluctant to do so because of the rules of your ideal world say that every worker in a company has one vote. Why in the world would my wife and I risk expanding our business by hiring three more employees when that action effectively means that we no longer control the company?
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MMT Donating Member (135 posts) Send PM | Profile | Ignore Mon Sep-01-03 01:40 PM
Response to Reply #36
37. Why indeed?
If you want to own it all, then why shouldn't you have to also do it all?
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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 01:46 PM
Response to Reply #37
38. Here's Why
The value of a business is the sum total of everything that went into its creation over time. In the example I gave, the value of the business was created by the efforts of my wife an I over a five year time frame. Why would it be fair to suddenly cede control of all that accumulated value over to people that did not create it?
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MMT Donating Member (135 posts) Send PM | Profile | Ignore Mon Sep-01-03 01:54 PM
Response to Reply #38
39. So if you don't want to give up control, don't expand!
That seems easy enough to me. If you want to keep complete control, completely do the work. What's unfair about that?
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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 01:57 PM
Response to Reply #39
41. So you agree?
My original point (post #16) was that the concept of economic democracy inhibits the expansion of a business. Do you agree?
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MMT Donating Member (135 posts) Send PM | Profile | Ignore Mon Sep-01-03 02:01 PM
Response to Reply #41
43. No
That's like saying the inability to get slave labor inhibits the expansion of a business.
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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:06 PM
Response to Reply #43
45. Strawman
Nice try, but nobody is advocating slavery. In my ideal world people are free to work where they choose and free to start whatever type of business they want, provided that no-one is forced to do anything against their will. If you think private business is bad, don't take a job at one. If no non-private businesses are availible, you should be free to start your own that works in a manner that you approve.

You bring up slavery, but it appears that you "economic democracy only" advocates are the ones that are opposed to freedom, not me.
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MMT Donating Member (135 posts) Send PM | Profile | Ignore Mon Sep-01-03 02:19 PM
Response to Reply #45
48. No, it's not.
There are lots of public policies that "inhibit the expansion" of business, and the inability to get slave labor is one of them. So is the inability to get free money, the inability to get excused from liability, the inability to have competitors declared illegal, and a lot of other rules. The inability to involve other people without selling them a share would be just another such policy. It would be a very clear choice: take a smaller piece of a bigger pie, or keep the whole small pie to yourself.

Of course, most of these rules are under constant attack by owners who think they *should* be able to get slave labor, free money, no liability, and no competition. How are you different?
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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:23 PM
Response to Reply #48
51. Yawn. Another Strawman
Of course, most of these rules are under constant attack by owners who think they *should* be able to get slave labor, free money, no liability, and no competition. How are you different?

I'm different in that I don't think people should be able to get slave labor, free money, no liability, and no competition. What post of mine indicted otherwise?
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MMT Donating Member (135 posts) Send PM | Profile | Ignore Mon Sep-01-03 02:27 PM
Response to Reply #51
54. No, not "another strawman". But you're right,
I worded my question poorly.
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htuttle Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:10 PM
Response to Reply #41
46. I don't agree
Cooperatives often expand if desired. Or not. Depends on who's involved, and what their collective goals are.

Another option is to close membership. Yellow Cab of San Francisco is a good example of this. They started as a regular Coop, with all workers as members. Over the course of years, the membership decided that they didn't want to dilute ownership and equity any further, so any future employees would be just that: employees. The existing members were still full voting members (with a provision for filling membership 'slots' emptied by attrition over time with new members).

Just because a business is a coop, does not have to mean that all employees are members. Many use a mixture. Others state that ALL employees must be members. None of these options limits you as to things like hiring outside contractors, services, etc.. either (although there may be guidelines set up, like preferring union shops, etc...).

I've been in coops that have voted to expand membership. It was not really any easier or harder than expanding a regular business. People can be motivated by a lot of things other than sheer monetary greed. The membership (via the elected board) may decide to invest in expansion to ensure the long-term health and operation of the coop, for example. Or they may decide to diversify (either directly or via a subsidiary coop). Or maybe they want a better deal on health insurance. Or they might like things the way they are, and stay the same size.

Again, all in all, if the people involved are mature and want the coop to succeed (and that goes back to the point I made elsewhere about coop education of the membership), the decisions to be made are the same decisions that any other business has to make.



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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:20 PM
Response to Reply #46
49. No problems here
I have no problem with any of the ideas in your post. I think that people should be free to set up corporations in any manor that they choose, provided no person is forced to work there (e.g. slavery is not allowed). What I am opposed to is the idea pushed by many on this thread that all corporations should be controlled by democratic rule. I'm opposed to it because it limits what people can do, and limits creativity and change. For example, your post mentions a Cab company that decided to do what looks like a merger of the co-op model and private business model. This type of innovation and flexiblilty should always be availible to people.
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MMT Donating Member (135 posts) Send PM | Profile | Ignore Mon Sep-01-03 02:23 PM
Response to Reply #46
50. Doesn't closing membership violate the Rochedale Principles? n/t
Edited on Mon Sep-01-03 02:23 PM by MMT
n/t
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htuttle Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:26 PM
Response to Reply #50
53. Yes, it does
Personally, I'd never want to do that (and have never been associated with a coop that did), but there's no law against it.

The Rochedale principles are more guidelines than rules (but they should really be followed, IMO). Half a coop is better than none.
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Yupster Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 05:09 PM
Response to Reply #46
67. But if you close membership?
then where are you? You have employees working for large companies again. It seems the point of the original post was to get rid of that.
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Yupster Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 05:07 PM
Response to Reply #41
66. If I can answer your question Nederland?
Edited on Mon Sep-01-03 05:17 PM by Yupster
Yes, it would inhibit expansion of businesses, but some would find that an acceptable trade-off.

My own opinion is let 1000 flowers bloom. The models which wok best will become dominant.
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htuttle Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 01:54 PM
Response to Reply #38
40. What you are describing is not how coops start
VERY rarely have I ever heard of a coop that started as a privately-owned business. Those that have that I'm aware of, bought out the original owners. What you are describing is some sort of 'cooperization'-eminent-domain-situation that has never happened (outside of Communist revolutions).

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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:02 PM
Response to Reply #40
44. True
Edited on Mon Sep-01-03 02:06 PM by Nederland
I was simply pointing out that if you pass some sort of legislation that outlawed private business you would have a chilling effect on small business growth. I'm not sure if the poster had this in mind, but I'm pretty sure that such leglislation would be tremendously stupid. I like diversity. I like a system that allows private and public business to both exist and would hate to see laws to restrict the existence of either one. If you want a private business, start one. If you want a co-op, start one. Why shouldn't people be free to start whatever form of business they want?
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htuttle Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:12 PM
Response to Reply #44
47. Legislation?!?!?!
I must have missed that point somehow.

See my reply #9 re: legislation.

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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:28 PM
Response to Reply #47
56. Response
The person that appears to be pushing the idea that only one type of business model should exist is MMT. S/he never said so explicitly, but I gathered that from these posts:

ost #37 - If you want to own it all, then why shouldn't you have to also do it all?

Post #39 - So if you don't want to give up control, don't expand! That seems easy enough to me. If you want to keep complete control, completely do the work. What's unfair about that?

Post #50 - Doesn't closing membership violate the Rochedale Principles? n/t







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MMT Donating Member (135 posts) Send PM | Profile | Ignore Mon Sep-01-03 02:32 PM
Response to Reply #56
58. No, I was responding to your "your ideal world" assumption in #36 n/t
Edited on Mon Sep-01-03 02:40 PM by MMT
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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 03:06 PM
Response to Reply #58
64. Perhaps
I should turn this around. What's wrong with starting a business with a charter that says: "I'm the boss and if you don't like it you don't have to work here"? What's wrong with a system that allows all types of businesses (public, private, co-op, whatever) to exist?
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WhoCountsTheVotes Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:32 PM
Response to Reply #36
57. the anecdoates are always "small family business" never large corporations
Edited on Mon Sep-01-03 02:35 PM by WhoCountsTheVotes
Notice how every argument is met with a story about a small hard working family business, never a large multinational?

Now how does your point relate to a typical multinational corporation? Can you provide these kinds of hypotheticals for large businesses, or just small family businesses?


"The fact that the boss is elected inhibits the expansion of a business."

Yet bosses are elected all the time, and it hasn't prevented expansion of a business. I assume your rules for an ideal world are different than mine, I can accept that.

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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 03:03 PM
Response to Reply #57
63. That's how they all start
Businesses almost always start as a small group of people. Microsoft was started by Bill Gates and his college roommate. HP was started by classmates Bill Hewlett and Dave Packard in a garage. In fact, I'm not sure you could find a transnational that didn't have humble beginnings--they were all "family" businesses to begin with.

The most important thing here is that I have no problem with your business model--what I have a problem with is people that want to outlaw mine. I see nothing wrong with a person starting a corporation whose charter basically says: "I'm the boss and if you don't like it you don't have to work here." So long as no-one is compelled to work there, no one can complain that they were taken advantage of.
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Terwilliger Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 12:22 PM
Response to Reply #4
31. focusing on what it does right brings out what its doing wrong
Edited on Mon Sep-01-03 12:24 PM by Terwilliger
or, don't you see that?

Roosevelt had to enact socialism to save this country from a ruin that resulted from the unforseen concentrations of wealth and power brought about by American industrialization.

Is that what you want to "fix"? Socialism is the only way.
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kodi Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 04:34 PM
Response to Reply #31
65. are you sure you read my remarks correctly?
if the purpose of government is to do justice for its citizens and if only a part of this is to foster conditions in which wealth is produced, then anything done by the wealth-producer that is less than satisfactory for the welfare of the citizens IS prima facia evidence that the free market alone can not do for the citizens what government has to do.

your example of fdr and his use of the socialism of the new deal to combat the vagaries of capitalism is exactly the point i was making.

by increasingly ceding the obligations towards the citizens of popular goverment to the free market is where we are today.

its why i called it an "obligation gap."

its crucial to the debate to understand just what the free market can and can't do, so one can point to government to fill the "obligation gap."

unfortunately many on the right use subtle rhetoric to cast ALL government as merely a protections racket, and dismiss out of hand any differentiation between legitimate democratic forms of government with those less democratic. by lumping them all together, they can dismiss all forms of government as a protections racket and we are left with no more than a Hobbseian world and the law of the jungle. that they want this is obvious, because they think that they are the strong and will benefit from such a world.
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WhoCountsTheVotes Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 12:56 PM
Response to Reply #4
32. Not socialism
At least not as socialism is practiced in Europe and the United States. Having the state, the government, or a government institution owning businesses is one thing, and having business owned by the people that work there and the customers of that business is another.

The government can sometimes just get in the way. It wouldn't make sense to get rid of outside owners if you just add another organization that acts like outside owners.


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sweetheart Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 03:02 AM
Response to Original message
11. do you think the US economy is not planned?
It seems we have economic feudalism to contrast to mondragon's survival... as surely it would be attacked by american companies that would cut all overheads and discount the social contract... that such a company would be brutally crushed in american life.

Fairness comes from tarriffs levied on a market by a democratic government to represent the public-goods costs of commerce. How can a sustainable economic system develop when the gasoline-transport business is subsidized. How can we get people in to long term economic stability when boom-bust tech sector subsidies shift the "perfectly flexible" labour force forever in search of grub.

How can it be developed given the monopoly of the opaque and undemocratic federal reserve system... that will not support the financial basis of a plural system... opening up open markets committee credit issuance to schools and more than energy and military industrial subsidies.

Yet does it not always come down to poperty rights. Do you have the right to own the intellectual property of another person? Does my property right to capital supercede my contract to the state to be a good employer? The neo-lockean view on property would say that my capital is a right soooo absolute it supercedes the state. This fundamental bias towards misunderstanding of the social obligations of property, and the reality that the land is not "owned" rather inhabited for a short while... parcelled out by favours in the bankrupt caste system of american life.
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opihimoimoi Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 08:01 AM
Response to Reply #11
12. Seems like coops are in it for the long haul.
nough said
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LWolf Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 09:37 AM
Response to Original message
14. It can be done.
Getting from here to there is a big job.

Where do you think the most effective place to start would be?
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Touchdown Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 11:23 AM
Response to Reply #14
21. We can start by reading this...
http://www.amazon.com/exec/obidos/tg/detail/-/1576751252/qid=1062433177/sr=8-1/ref=sr_8_1/104-6530715-6861555?v=glance&s=books&n=507846

I'm thinking that a new stock market should be set up, with rules in place that the member companies must be answerable to all "Stakeholders" like employees, and the communities they do business in to membership.

...and this new stock market should be NOWHERE NEAR Wall Street, and preferably not even in New York, to keep it from being corrupted by the NY, American, Nasdaq exchanges.
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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 10:21 AM
Response to Original message
17. Question
Ultimately do you see this model as being the only model in an economic system, of merely one of many? If it is to be the only model, is it your position that other models akin to today's corporate structures be made illegal?
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JanMichael Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 11:16 AM
Response to Reply #17
20. Good question. Ultimately? For certain industries yes.
Through laws ("illegal" is such a caustic word, what about saying that they'd be Evolved by legislation?) encouraging their development.

I suppose the system of corporate structures would have to be modified. Even Mondragon changed their "President" wages over time in order to function within the world economy. If this were to be enacted over the World's economic engine that may not have had to happen.

Either way the Mondragon approach works.

It's a real world example of business that exists to improve the Human condition without "enslaving" it simultaniously.
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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 12:14 PM
Response to Reply #20
27. I'm all for diversity
If this model is truly a better way of doing things, then it shouldn't need any help from government to thrive. The only thing I have a problem with is people that believe in restricting choice. If people want to start a cooperative business, they should be free to do so. If a person wants to start a private business, they should also be free to do so.
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Merlin Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 10:32 AM
Response to Original message
18. The "NCB Coop 100" list is bogus. These are NOT employee cooperatives
Nearly all of these companies are agricultural or electrical cooperatives. That means they are owned by their buyers (who are businesses) not by their employees.

With all due respect to those who espouse employee cooperatives, they have been tried before--especially in the 60s and 70s--and failed miserably.

There are three essential problems:
--------------------------------

1) Capital has to come from somewhere. Lower and middle income employees rarely have the investible capital or borrowing power needed to fund the start-up and operating capital required for a successful business.

2) Everybody thinks they deserve more money. Obviously there is only so much money. So when employees begin to make management decisions, things generally degenerate into My job's more important than your job arguments.

3) Nor do employees generally want to defer income and have profits reinvested in the business as any business needs to do in order to grow.

Even Ben & Jerry's--probably the most liberal big business in America--is run on a top-down basis. Management is not elected. Management makes the decisions.
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htuttle Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 01:02 PM
Response to Reply #18
34. I call those 'lessons', not problems
The cooperative I'm in has had to confront each of those points you mention as problems. Yes, they are problems, and each coop (as a social organism) needs to confront and learn new behaviors to deal with them.

Yes, many coops don't make it past that point -- it's something of a rite of passage (and it really hits when the coop reaches about 200 members). The 'coop education' point of the Rochedale principles should not be neglected, or the coop will NOT make it past those lessons. Many people need to be (re)trained to cooperate (though we all did learn this in kindergarten...right?).

And you are correct that most of the coops listed by the NCB are consumer or producer coops. Starting and operating a worker coop is hard, but well worth it, in my experience (over the course of a decade or so).

Finally, regarding Capital -- we just go to a bank. Many, many banks are aware of how coops operate, and if you have a decent business plan, they'll lend you the money -- just like any other business. We've borrowed hundreds of thousands of dollars from banks (and paid it all back) for capital improvements over the last 25 years. When my coop started, there were about 10-12 lower-middle income people with less than $20,000 between them (in the late 70's).

I don't want to minimize the problems you bring up. They can be VERY difficult to deal with. However, once a cooperative culture is developed that continually educates new members, and a democratic structure is created that is both responsive and stable (this is where the by-laws come in), the coop should be able to thrive in perpetuity.



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redeye Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 11:38 AM
Response to Original message
22. Enterprise
There are four categories of resources: land, i.e. natural resources such as flat land, lumber, and oil; labor, i.e. working hands; capital, i.e. investment money and machinery such as tractors, computers, and factory buildings; and enterprise, i.e. those businessmen and entrepreneurs willing to venture into the market. A command economy has no trouble with the first three, but runs into serious problems with often-neglected enterprise. Unions don't invent things; the lower- and middle-classes don't start new businesses; and coops don't create anything. The lower- and middle-classes are invaluable when it comes to labor, and unions are invaluable in ensuring that enterprise doesn't exploit labor, but only the market can give you enterprise.
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WhoCountsTheVotes Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 11:49 AM
Response to Reply #22
23. your categories are bogus
Edited on Mon Sep-01-03 12:16 PM by WhoCountsTheVotes
"capital, i.e. investment money and machinery such as tractors, computers, and factory buildings"

There is an obvious distinction between "investment money" and "machinery" and "factory buildings" - the money used in American and world business, is mostly intangible fiat-created credit, not a natural resource. The amount of "investment money" can be expanded or contracted without regard to the physical economy of goods and services.

And the real funny one:

"enterprise, i.e. those businessmen and entrepreneurs willing to venture into the market"

The only thing that differentiates these "businessmen and entrepreneurs" is the fact they command the "investment money" - their management functions are just another form of labor. When a business is started, everyone from the CEO to the entry level worker takes risks.



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WhoCountsTheVotes Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 11:54 AM
Response to Original message
24. Credit Unions are a very successful form of economic democracy
Edited on Mon Sep-01-03 12:24 PM by WhoCountsTheVotes
In fact, if it wasn't for the unfair regulations that have been paid for by banks, credit unions would probably be even more popular than they are now - even though they are already quite successful.

In a credit union, the owners and the workers and the customers are the same people. The profits from the customers go back to themselves, the owners. In fact, many credit unions still follow the principle of one-person, one vote, where each member of the credit union has an equal say in choosing management and business decisions.

Credit unions aren't perfect, but they are an example of economic democracy in the United States that is both highly efficient and works well for the people they are supposed to serve.


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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 12:09 PM
Response to Reply #24
25. What Regulations?
I'm a member of a credit union and I've never heard any complaints...
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WhoCountsTheVotes Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 12:14 PM
Response to Reply #25
26. there are severe restrictions on membership
Edited on Mon Sep-01-03 12:14 PM by WhoCountsTheVotes
that were bought and paid for by the banking industry, both at the federal level and the state level. Check out www.ncua.org, they usually post info when the banks are trying to push another set of restrictions.

"I'm a member of a credit union and I've never heard any complaints..."

Who were you expecting to hear a complaint about federal and state regulation from, the teller?




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Nederland Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 12:15 PM
Response to Reply #26
28. Nope
Who were you expecting to hear a complaint about federal and state regulation from, the teller?

I figured I read about it in one of the mailings...
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WhoCountsTheVotes Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 12:18 PM
Response to Reply #28
30. my credit union sent a mailing about it the last time they started some
I believe it was in 1999-2000, before the elections. I'm sure a quick search will reveal more.
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Terwilliger Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 12:17 PM
Response to Original message
29. YES!
If one man (or, a few men) can corner the money in a capitalist system, they will do so as a result of their capitalist training

if democracy is true in matters of capital, then no one should have power over the common wealth
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Clete Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:01 PM
Response to Original message
42. How does one finance one of these cooperatives?
I love the idea. Also, it seems some of the posters have socialism confused with Soviet Marxism, the latter being a form of fascism.
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htuttle Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:24 PM
Response to Reply #42
52. Step 1: Gather together the initial membership
Step 2: Count what you have between you. You'll be buying the fledgling coops 'preferred stock', or 'investment stock' (or whatever you want to call it). These shares don't vote, but they get paid back first in case of liquidation.

Step 3 (concurrent with step 1 & 2): Develop your business plan. At the same time, draw up your cooperative papers: Articles of Incorporation and By Laws. Philosophically, these are analogous to the Declaration of Independence, and the Constitution. This is an excellent time to consult with an attorney versed in cooperative law.

Step 4: File your paperwork to incorporate as a coop. Most states require at least 3 members (who may also be officers).

Step 5: Go to your bank. Some banks are more familiar with cooperatives than others. If you're in farm country, you're in luck. Wow 'em with your business plan, and the memberships' own investment (which may be more 'token' than useful...bank is looking for a commitment from the members here, not necessarily enough money to start with). With any luck, you'll walk out of the bank with a check, and you're good to go.

Step 6: Run the business. Don't neglect your governance structures (board, committees, meetings) -- they are all that stand between the membership and a yawning chaos. Without Robert's Rules of Order, all is lost. ;)

We live in a representative democracy (of sorts). Many organizations that people are already involved in operate democratically (associations, clubs, etc...not to mention local government and the PTA). As citizens of a democracy, any of us should be familiar enough with how democracy 'works', to understand the 'tools' of democracy, to be able to help create a democratic structure for any task.




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Clete Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:27 PM
Response to Reply #52
55. Thanks.
It sounds workable. I didn't know that the banks would be open to something like this and I do live in farm country.
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JanMichael Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:32 PM
Response to Reply #55
59. Here's an idea: Let's get the interested DU'ers involved.
In there own localities if need be but spin off our more Economically Left members under a working structure gleened off of the Mondragon model.

The basis of an Economic Revolution is here so why not "Capitalize" off it?
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Nlighten1 Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:41 PM
Response to Reply #59
61. indeed
This is a message we should be getting out.
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htuttle Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:33 PM
Response to Reply #55
60. Probably the most common type of coop is the ag-producer coop
Goes back to the time where a group of farmers would pool their resources to purchase a mill or grain depot. They'd get paid back patronage (ie ., the profits) in proportion to what they contributed in production that year.

Often, these same farmers would set up another consumer coop to collectively purchase things like fuel (which is definitely cheaper in bulk).

The additional advantage for them was that these coops could also deal with the general public (who weren't members) and generate additional business (which results in profits -> patronage for the members).

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JanMichael Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Sep-02-03 07:38 AM
Response to Reply #60
68. Unfortunately they never expanded to all the people in production.
Just the owners.

Game effort though I suppose when large banks and graneries had them by the balls for so many years.
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htuttle Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Sep-02-03 10:44 AM
Response to Reply #68
69. For most of them, that's true
I do know of one fuel consumer coop that is also run as a worker's coop, however, but most of them operate as traditional businesses. There's certainly no inherent conflict however -- both consumer grocery coops here in town are also worker's coops.

Generally, people who start worker's coops do so for the jobs. The farmers who start ag-producer and consumer coops already had jobs (ie., they were farmers) but needed the service provided by the coop. Most took the path of least resistance when setting up the operation of their cooperative mill/depot/etc... (least resistance meaning 'least amount of effort needed to get it going').

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WhoCountsTheVotes Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Sep-01-03 02:42 PM
Response to Reply #52
62. Use a credit union whever possible
Edited on Mon Sep-01-03 02:42 PM by WhoCountsTheVotes
That way your banking fees and interest go back to your coop, since you are now a member of a financial coop, the credit union. It's usually very easy for a business to join a credit union, in all states.

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