Even when I was living in a very liberal area, there were only a small handful of stores that advertised as worker co-ops. It’s funny too because those co-op stores were all incredibly popular and successful, so I don’t understand why they are so comparatively rare? The organizational structure seems simple to maintain, and has a high incentive for regular workers to go above and beyond since they directly benefit from the business being successful, so what’s the deal? I am speaking from a US centric view, so maybe things are different in Europe, but even with my limited knowledge I feel like they are relatively unpopular there too, but maybe not? I dunno.
It’s easier to get loans or investment if you can offer ownership of the business or its assets as collateral or equity. That’s easier to do with concentrated private ownership than with a business that starts as a cooperative with shared ownership. So there is a structural¹ bias in favor of concentrated ownership and away from cooperative ownership when starting a new business.
In some successful worker-owned businesses, the business started as a traditional private endeavor and then converted to worker-owned through the deliberate choice of the founders & workers. For instance, the Cheese Board Collective here in Berkeley started as a privately owned cheese shop which was then sold to its workers a few years later. It’s been a cooperative since 1971.
¹ That is, the system can have this bias, regardless of whether the individuals making up the economy have this preference.
The loan part makes a lot of sense, much easier for a bank to deal with a single person rather than a whole cooperative. Funnily enough, the Cheeseboard and Arizmendi were the two co-ops I was thinking of when I made this post. I was just musing about how in the Bay Area practically every small business has all the trappings of progressive politics (the signs, inclusivity, supporting various causes) but so few actually put their money where there mouth is and organize into co-ops.
Perhaps it’s worth pointing out that progressive liberalism and worker cooperatives are not as aligned as you might believe, but that’s probably too off topic. Worth doing some reading about though.
The Mondragon Corporation is a federation of worker-owned coops in Basque, Spain that involves 81,000 people and has been running since the 1950s. They have coops for manufacturing, banking, retail and education and they all work together to support each other.
https://en.m.wikipedia.org/wiki/Mondragon_Corporation
The book “From Mondragon to America” (available on Kindle and elsewhere) goes into extensive detail about how it works.
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You need a lot of capital to start a business, which is usually held by people who don’t have an incentive to start a business for others benefit.
Also, entrepreneurs are usually individualistic (not talking shit, that’s just the nature of it).
They’re tricky. While they can be extremely healthy and successful, with extremely high employee morale, they can also be cumbersome and bureaucratic, as that’s the power structure that replaces the traditional hierarchy. So, very much a pros and cons thing, they’re not just exclusively more fun and amazing to work at.
When it works its great though.
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Any given co-op into the hundreds of people or more is going to have noticeably more. There is just literally a greater number of people involved in almost every phase of decision-making. This cannot be made quickly.
Just because corporations are cumbersome does not mean they are going to be just as bad as co-ops in this regard. And just because we like co-ops does not mean we should not try to be somewhat objective about them. They are certainly not simply across-the-board superior in every way, that’s just fantasy. Except at small scales, then the cumbersomeness doesn’t really come into play.
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Curiously, the internal economy of a typical “capitalist” corporation is strictly dictatorial, even to the point of Führerprinzip: every sub-unit of the corporation has a manager in charge of it, who has dictatorial control of that part of the company, and is only responsible to their own manager.
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I spent a lot of my twenties trying to get a publishing group off the ground using a worker co-op model. It became clear pretty quickly that a hierarchy of responsibility was needed simply to keep the workflow moving, as relying on the self-motivation of contributors was a recipe for disaster, especially for those doing editorial or production work.
In my estimation, it can work, but only if the workers take on the attitude that they truly own the business and are responsible for it. This requires a higher level of scrutiny on incoming members than in a traditional business structure, as bad actors can have an outsized affect on a organization with loose hierarchical controls.
Sadly, my experience led me to believe that most people are more willing to work for someone telling them what to do than they are for themselves. The ability to muster effort and energy behind effective self-motivation is a rarer trait than most of us would like to admit. For a co-op to be successful against corporate competitors, every worker has to take responsibility for the organization and its success. In a corporation, only the boss has to - the workers only have to be responsible for what their boss thinks of them, not the direction of the company.
Co ops can have traditional chains of command, the only defining characteristic of a co op is ownership. There’s no reason why a leadership hierarchy and leader ownership must go hand in hand.
A well-functioning co op can take in any worker irrespective of work ethic and provide them with the structure and support to develop into a valuable team member. The problem is that co ops, like anything aren’t guaranteed to function well.
So no, a co op does not require all workers within in be fundamentally minded towards the business. A co op simply means that the ownership of the company and the labour force are one in the same. There are plenty of co op workers all over the world who just show up and do their job, they just also have a voice and must be considered differently as a result.
I agree with your first paragraph, and once we instituted a traditional hierarchy of responsibility in the form of editors and publishers with defined timetables and expectations, things ran more smoothly - the effort lasted 12 years in all before closing.
However, the amount of management and moderation involved from those placed at the top was far greater than in a comparable corporate structure, in large part due to the human behavior factors I addressed above. This led to burnout, and which had a cascading effect on those with less responsibility. While I don’t regret what we accomplished, I’ve come to the conclusion it would have been undoubtedly easier to succeed in the publishing space with a corporate structure.
As such, I disagree with your assumption in the latter half of your comment that a co-op can take in any worker irrespective of ethic. A co-op thrives because it’s a community that relies on each other. When you introduce bad actors into the mix, who are benefiting without contribution, it breeds resentment and similar behavior if not corrected quickly - especially if you’re working on a profit-share basis. My experience in both the non-profit and corporate worlds has shown that the latter can absorb a much higher ratio of these bad actors than a co-op or non-profit can, as these latter organizations rely on an equitable social contract to motivate their workforce. Corporations just rely on a paycheck.
I appreciate your practical perspective vs the armchair philosophy on the matter. My company is private for-profit, but with a very loose heirarchy and a small team. None of us except the founders even own any of the company, but we are well paid and well taken care of with generous insurance and bonuses, and regular raises. Most of us appreciate that and work hard so the company can succeed - and we all get to keep working here. However we’ve had a few people who really didn’t pull their weight, and it does indeed breed resentment and detachment which only gets worse if nothing is done to correct it. If they hadn’t been let go, the damage to our culture could have sunk us.
It’s expensive to start a business. You’d need some seed money to start the thing for rent, products, salary and more. If a bunch of people go together, pool their money, sure they might get it to work, but they also share all the risk of failure. Also, who decides if there is conflict? Who has the final say? Not everything can be solved by compromise.
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From my limited experience usually it’s because they implode from internal drama. To be human is to be lazy, and most people can’t get past that.
