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Separating Utopian Goals from Working Models.

In Part 1 (DailyKos, AMC, Is a Non-exploitive Economy Based on Worker-Owned Cooperatives Possible, http://www.dailykos.com/..., Sun Jul 24, 2011) we analyzed the dynamics of developing a cooperative economy as an alternative to a competitive capitalist economy. Under Capitalism, economic growth is based on competition and the accumulation of monetary profit. This is increasingly proving to be an unsustainable form as money is accumulated in the hands of a few at the expense of the general well-being of global society.

Currently 100 million people are members of 47,000 cooperatives in the United States. Globally cooperatives employ more than 100 million people and have over 800 million members. While still part of the private ownership capitalist model, a cooperative economy is rooted in the democratic wishes of the workers (people power vs. money power) and might eventually provide a transition toward an economy based on societal cooperation to maximize the use of material goods for all. In other words, creating goods and services people want (fixing the bridges, cleaning up the air, providing good schools) for society in general instead of amassing individual monetary wealth for a few.

Since cooperatives are still subject to the dictates of the capitalist society under which they operate, most worker-owned and managed cooperatives vary to a greater or lesser degree from the “pure” cooperative model.  While some of these variations can be explained by the particular situation of a particular cooperative –the type of enterprise, the needs and wishes of the worker-owners, etc. and do not threaten the democratic or equitable nature of the cooperative, most of the deviations are determined by regulations/laws of the particular state or country and the competitive capitalist environment in which the cooperative has to operate.  

Two different models of cooperative networks:

This post (part II of the article) will compare: 1) The state sponsored model in Venezuela where funding and regulations that define cooperatives originate in the political process and 2) the Evergreen Initiative private sector model in Cleveland, Ohio which uses a network of existing industries and community nonprofits to drive cooperative development.

Because of its importance as a model to the overall development of cooperative networks, we will also refer back to the Mondragon Model in Spain which was discussed generally in Part 1 and in detail in an excellent diary by T Pau in the AMC (Mondragon Miracle, sun Jul 3l, 2011,http://www.dailykos.com/...).

This piece analyzes how each model deals with the major problems that are barriers to the development of a cooperative economy within a capitalist economy. The point is not to judge, at this juncture, the superiority of one model over the other, but to see how different models are affected by and operate in practice given the economic and ideological environment in which they have developed.

1) How do the different models raise capital for economies of scale?

To have a fully developed cooperative economy, the major industries must be worker-owned and managed. Worker/producer coops breakdown into those that produce commodities which are capital intensive, and those that produce services, which are generally labor intensive. Obtaining the capital and economies of scale necessary for capital intensive projects is one of the major problems the cooperative movement has faced.  Original accumulation of capital that financed the industrial revolution was a combination of primitive accumulation through exploitation of the transatlantic slave  trade, and of imperialist exploitation of cheap raw materials and resources in third world countries, first in Latin America, then in Africa and finally, in the Middle East.  

Since the current global economy is controlled by the Multinationals and banks through financial institutions such as the World Bank, the International Monetary Fund and the World Trade organization, new models of economic development must develop new sources of financing if they don’t want to be absorbed into the existing capitalist model.

2) How much control do workers have over their workplace?

While the cooperative movement is innately oriented toward democracy and principles of social cooperation, many people confuse the movement for worker-owned enterprises with worker-managed enterprises (cooperatives). Many conservative capitalists are eager to encourage worker-ownership (Employee Stock Ownership Plan) as a way to bust unions, provide incentives to increase production and worker and capital retention (workers-ownership profits are tied up in their retirement plan and cannot be accessed until they retire). In most cases, the workers do not own a majority of the stock and share stock ownership with outside (non-worker) shareholders for whom profit is still the primary motive.  Even as owners, they generally do not manage their plants and have no control over policy decisions (to move a plant to another country) or the hiring and firing of workers.

Cooperatives, on the other hand,  are defined by the International Cooperative Alliance’s Statement on Cooperative Identity as “autonomous associations of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through jointly owned and democratically controlled enterprises.” Anarcho-syndicalists suggest that, unlike profit oriented enterprises, cooperatives which are worker-owned and managed enterprises, where each worker owners one share and has one vote, will create a transformative economic form that could replace a capitalist system based on profit accumulation.  Based on the ideas of economic democracy and voluntary cooperation without class conflict or labor exploitation, anarchists focused on organizing from the ground up, establishing locally managed cooperatives, further linked through confederations of unions, cooperatives and communities.

3) How can a cooperative model compete with global capital in a free market economy?

As capitalist corporations have grown into multinationals, creation of maximum profit is based on financial aspects only.  Buying and trading of corporations and stock become further and further removed from the production of actual commodities. Profit becomes abstracted from the underlying real economy. Management increasingly ties wealth and profit to “money wealth” at expense of the wealth creation based on producing products and services people want made under humane, democratic conditions.  Considerations for a safe commodity of value, for retaining an experienced workforce do not apply. With the increased domination of financial capital, CEOs go for immediate, short-term maximization of profit by cutting workers at plants to increase the cost benefit ratio and moving plants and outsourcing jobs in pursuit of cheap labor. profits.

Cooperatives offer a much more grounded way of encouraging democratization in the work place, stabilizing the workforce by emphasizing the group ethos over the individual.  Since the “stakeholders” are the workers, it is in their interests to make the actual product they produce successful.  This stabilizes the economy from the productive end.  Instead of maximizing money profit, it maximizes the use value of the goods produced—that is, the workers are rewarded by improving goods, keeping the enterprise solvent. In worker-owned cooperatives the orientation is toward building profitability by emphasizing the  use value for the workers as a whole rather than monetary value for an individual.   Instead of chasing around the globe looking for bigger monetary profits, cooperatives tend to focus on their local economy, where their life is. The workers’ goals often include a sense of how their work fits into the community.  They buy from other local producers, they are concerned about the education their kids will get in local schools, they are concerned about how their workplace effects the environment and the health of their neighbors. The shift in direction from financial profit for a few to the value of the enterprise to all the workers helps locally developed cooperative communities resist the pull of profit driven capitalism.

VENEZUELA: THE STATE MODEL

There were 181,000 cooperatives officially registered in Venezuela as of the end of last year—an astonishing figure that puts the South American nation at the top of the list of countries in the world with the most cooperatives. Over 99 percent of Venezuela's cooperatives have registered since President Hugo Chávez Frias took office in 1999.

The cooperative boom is key to the shift by the Venezuelan government towards an economy based on the inclusion of traditionally excluded sectors of society and the promotion of alternative business models as part of its drive towards what Chávez calls “socialism of the 21st century.”

The Venezuelan model most closely follows the Marxist model which says that any new economy must get political control of the State if it is to succeed.  While the Bolivarian revolution was not a complete revolution in the Marxist sense, Chavez’s democratically elected government controls a majority of the National Assembly, has the authority to govern based on a new constitution which was written and passed by a majority of the citizens of Venezuela and which contains a number of socialist principles of equity and  citizen participation.  The Chavez government also has control of the major productive industries (oil, cement, etc.) as well as the support of the military (as was seen when the United States attempted to overthrow Chavez in a military coup).

Because of this unique situation, the Bolivarian government has the ability to institute and fund, through the public sector, a large scale cooperative movement which was first addressed extensively in the AMC by Justina (Sun Apr 17, 2011 at 05:31 PM EDT, http://www.dailykos.com/...).

History:

At the time that Chavez was elected in 1998, poverty had been on a slow but constant rise since the middle half of the century. Its capital, Caracas, is surrounded by poor barrios that house almost half of its population of nearly 5 million in substandard conditions. Under externally imposed neo-liberal policies, Venezuela's poor were left with few options in a society that former vice-minister of popular economy (MINEP) Juan Carlos Loyo, described last year as “profoundly individualistic ... profoundly unequal, and discriminatory.”

The cooperatives created under the Bolivarian cooperative law did not come about in isolation.  Venezuela already had a strong cooperative movement which developed under the influence of liberation theology (part of the impetus of the Mondragon cooperative movement in spain). One example is  CECOSESOLA which started as a funeral co-op in the late 1960s and now has over 300 associated workers, 20,000 associated members, and is composed of over 80 cooperatives (savings, agricultural, production, civil associations, organizations, and a puppet crew).

“The goal is transformation,” says long-time CECOSESOLA organizer, Gustavo Salas Romer, “The economy is secondary.” Unlike the Bolivarian government cooperatives, however, the early cooperatives were self-financed without help from government or charities.

During the pre-Bolivarian 1970s, co-op members were labeled subversives, the cooperative was infiltrated by agents from the Venezuelan secret service. The struggle destroyed many co-ops.  When Chávez was elected, members of CECOSESOLA along with dozens of Venezuela's nearly 800 cooperatives began to push hard to get co-op norms established in the new Constitution.

Special Law of Cooperative Associations in 2001.

This law made it easier to form cooperatives, and, in the words of former Cooperative Superintendent (SUNACOOP) Carlos Molina, “transformed cooperatives into a fundamental tool of social inclusion,” targeting the poorest and least educated members of society.  

Why cooperativism? “Because cooperativism goes further than purely economic activity, and is based on productive relations which are collective, in solidarity, and above all else inclusive,” says Molina.

The broader support network.Not only does the government fund and regulate cooperatives directly, but the drive toward a cooperative economy is evident throughout Venezuela’s social programs. The government has set up a number of social “Missions” to help citizens with their educational, health, housing and employment needs.

The Venezuelan government began promoting the creation of co-ops by prioritizing them for government contracts, offering grants and loans with little or no interest, and eliminating income tax requirements for co-ops. Cooperative numbers immediately began to grow.

The same year, the Venezuelan government began to promote what it called “Endogenous Development” (economic development from within), directly in contrast to the neoliberal model imposed during the 1990s, which promoted privatization and corporate ownership. 130 Nuclei of Endogenous Development (NUDEs)are located across the country as centers of local development.

At the pilot Venezuelan NUDE in western Caracas, Fabricio Ojeda, more than 40 worker-collectives intermingle with the government health mission, Barrio Adentro, and the low-priced government-sponsored food store, Mercal. Many of the programs target special groups that have been excluded due to social discrimination (i.e., there is a special Afro-Venezuelan Mission).

Banco Mujer is a lesson in grassroots organizing  and reflects the bottom up goal of the Bolivarian project. Banco Mujer was established to help women get micro-loans.  At the request of  a group of women, the bank sends a representative to discuss establishing a cooperative. The women have the choice to register as cooperative or become an associative economic unit, a slightly less collective form.  The discussion takes place in the women’s homes. The representative goes to the women in their local community., the women do not have to go to the bank.

The most important aspect of Banco Mujer’s approach is that all decisions are left up to the women. The representatives raises the issues relevant to how the cooperative will operate. Are we single mothers? How do our husbands feel about us working (issues of domestic violence frequently come up when husbands do not want their wives to work and support networks for these problems must be established)? How many children do we have?  How does our being black or indigenous impact our goals? How does our being a rural group differ from an urban collective?  The representatives, who come from all different classes, races and backgrounds,  are carefully chosen so that issues of class and race rarely become problems. Only after a number of meetings, the establishment of an investment plan and meetings to teach basic economic and planning skills is the loan awarded.  Monitoring and follow up are provided.

Vuelvan Caras

A cooperative job-training program which began in 2004, it is the largest effort to intensify cooperative development in Venezuela in recent years and resulted in the formation of 8,000 cooperatives, or worker-collectives, formed by the nearly 300,000 graduates.  

Estrella Ramirez, a disabled unemployed single mother signed up for a free literacy program through Mission Robinson.  Three months later, her teacher encouraged her to enroll her in the government's new cooperative job-training program, Vuelvan Caras (About Face). Ramirez with her fellow Vuelvan Caras graduates received an $80,000 zero-interest loan from the Venezuelan National Institute for Small and Medium Industry to buy 20 sewing machines and purchase their first materials for their new cooperative, Manos Amigas. The government provided a prime location—free of charge—from which to run their cooperative, in a rundown building in downtown Caracas. They invested part of their loan in fixing up their space on the fourth floor. Meanwhile, many cooperative members continue to study in the government education missions, Ribas and Sucre.

In contrast to most factories in Latin America, the atmosphere is relaxed. There is no punch-card. When someone is suspected of abusing the system, the matter is taken up in a general assembly before all Manos Amigas members.

As is the norm under the 2001 Venezuelan Cooperative Law, a president, secretary, and treasurer are elected yearly. The co-op holds a general assembly once a month, and decisions are made by consensus or by majority. “No one is boss, everyone is part of the team,” said one member.  Other textile cooperatives have voted to work less, to allow more time for continued study and time with families. Larger co-ops have set up daycare centers to care for the children of the cooperative workers.

The Ideal vs. the Real.

Unfortunately, the reality of the cooperative boom is not without its problems. According to last fall's first Venezuelan Cooperative Census, less than 40 percent of the cooperatives registered at the time were actually functioning.

Many of the discrepancies come from businesses that registered and either never got off the ground or failed to comply with the cooperative law. In rare cases, so-called “ghost cooperatives” registered and received loans from the government before disappearing with the cash. Venezuelan cooperative totals are growing at hundreds per week, and former SUNACOOP director Molina verified last year that they have no hope of being able to audit them all.

Another reason for the low rate of success is inherent in the Bolivarian philosophy.  Unlike other loans, the Bolivarian approach of funding is more like an entitlement program – groups are often given loans to develop coops based on their neediness, instead of their viability or ability to pay back the loan.  They are often given with little or no collateral and at no interest.  If one wanted to, one could say that the Bolivarian approach has had a 40% success rate, substantially reducing poverty – more than most traditional poverty entitlement programs.

Another challenge is the resistance of the capitalist sector in Venezuela which still controls much of the state and local government apparatus. In spite of the legal support for cooperatives at the National level,  bureaucratic state and local authorities can hold up various licenses that cooperatives need to survive and grow, sometimes due to political differences with the Bolivarian government, sometimes as part of a residual culture which will not provide the required license unless a bribe (unaffordable to the poorest coops) is offered.

Part of the solution to the bureaucratic stonewalling of cooperatives was The Law of Communal Councils (consejos comunales) passed by the National government in April 2006 and reaffirmed and updated, after  two elections widely contested by the Capitalist class in Venezuela, in November of 2009.  The Communal councils empower local citizens to form neighborhood-based elected councils that initiate and oversee local policies and projects towards community development.

Communal councils convene and coordinate existing community organizations as well as promote the creation of new work committees, cooperatives and projects as needed in defense of collective interests and the integral development of the community.

The jurisdiction of each council is limited only by size to a self-defined geography housing under 400 families, All key council decisions are made via discussion and majority vote within a citizens' assembly with at least 30% of the adult community present.

Councils are highly autonomous and, although they are often required to coordinate with municipal administrations and receive funds from various levels of government, can frequently side-step these bodies and gain funding directly from the National Government. Over 19,500 councils have already been registered throughout the country and billions of dollars have been distributed to support their efforts.

Individualism vs. Collective Consciousness.

Some of the cooperative movement’s problems are internal. In Esmeralda Ramirez’s coop, only half of the nearly 30 founders remain. The greatest challenge is individualism, say numerous cooperative members. It's difficult to change overnight. Venezuelan cooperatives’ economic exchange largely takes place through a somewhat regulated capitalist market, a situation that undermines both the implementation of genuine workplace democracy and the development of members’ collective consciousness. Indeed, traditional cooperatives in this study are only partial cooperatives, often run by families, operating only a few days a week or corrupted by permanently hiring labor. The more traditional cooperatives also carry-over patriarchal attitudes and the women members are frequently not involved in the actual cooperative work.

A study of 14 cooperatives both state sponsored and private social enterprises in operation for at least one year, found that members’ interest in participation is strongly tied to the extent that formal and substantive workplace participation has been established in their cooperatives. The two oldest cooperatives benefit from the highest levels of members’ motivation because they have the most consolidated mechanisms for workplace democracy.

Levels of workplace democracy are also strongly tied to levels of members’ participation in political and social organizations in their communities. Such workers feel more prepared to participate and are more willing to assume initiative and responsibility. However, in both traditional and new cooperatives, it is common to find members who have become active organizers in their communities after joining their cooperatives.

The study also showed that cooperatives with the largest membership have been less successful in achieving genuine workplace democracy. Equality in access to information, work roles, and control over the decision-making process, as well as collective monitoring, become more difficult to implement as the size of the cooperative increases.

One study observed that when large previously existing enterprises are taken over and turned into cooperatives by liberal or socialist leaning states (Venezuela, Argentina, Nicaragua), unless the state actively works to change the previous capitalist culture, the new “cooperative” will continue to operate under traditional autocratic boss/worker relations even if the financial structures are publicly owned.  In one case, some of the workers did not even know they were members of a cooperative.

The most significant factor limiting the emergence of collective consciousness in the cooperatives is the level of internal conflict, which also coincides with the size of the cooperatives, the lack of cohesion among cooperative members and the lack of “collective” training. Indeed, the cooperatives with the most intense internal conflict were indeed those from the Vuelvan Caras program. Many of the problems in the Vuelvan Caras cooperatives are directly linked to its quick development and lack of adherence to the proposed model in its efforts to increase cooperative participation on a large scale, especially for the disadvantaged.

Coops are supposed to be formed by persons who have spent at least six months together in a classroom environment that promoted solidarity and egalitarianism. But the reality is that, given that significant numbers of participants who left the program before the training period ended, many Vuelvan Caras graduates entering cooperatives had never spent time together.

Another source of conflict in Vuelvan Caras cooperatives is that some government instructors crossed the fine line between providing support and imposing their views, thus delegitimizing the cooperatives’ coordinators. In one case, it was the instructors who nominated the first group of coordinators, leaving the assembly only the power to approve the decision. Further, in cooperatives where income distribution was egalitarian some members felt that other members did not do their share. In cooperatives where there are systems of collective monitoring, egalitarian distribution did not result in free riding.

Government officials acknowledge that the design and implementation of the first cycle of Vuelvan Caras was highly improvised. Instructors were hired without a selective process to ensure that they were technically and ideologically prepared to teach students from the most marginalized sectors of the Venezuelan society. Also, all Vuelvan Caras cooperatives in the study cited had received their sociopolitical education either in a hurry at the end of the program, afterwards, or not at all.

THE EVERGREEN INITIATIVE: THE PRIVATE SECTOR/ANCHOR INSTITUTION MODEL

What is an appropriate path to economic development for de-industrialized cities where the loss of a manufacturing economy has left many people adrift? How can people who live and work in cities build robust local economies that are based upon democratic principles? It was in Cleveland, Ohio, a region that is the fifth poorest in the United States with a combined median household income of  $18,500 and a poverty rate of 30% , that the idea of the Evergreen Initiative was born.  The victim of the flight of the manufacturing industry combined with white flight to the suburbs, The Evergreen Initiative is a consciously designed network of worker cooperatives in Cleveland Ohio.
The Evergreen Initiative, begun in 2009, is funded and designed by local private sector businesses and nonprofit institutions. The concept, according to the Evergreen Initiative, is that shared ownership of the local economy not only helps root wealth in communities, keeping resources from “leaking out” of the area, but can be an engine for creating new endogenous wealth. Cooperative businesses are one of the more natural firm types that fit within the model of economic democracy. According to a white paper produced by the Cleveland foundation,

“Rather than a trickle down strategy, Evergreen focuses on economic inclusion and  building a local economy from the ground up; rather than offering public subsidy to induce corporations to bring what are often low-wage jobs into the city, the Evergreen strategy is catalyzing new businesses that are owned by their employees; rather than concentrate on workforce training for employment opportunities that are largely unavailable to low-skill and low-income workers, the Evergreen Initiative first creates the jobs, and then recruits and trains local residents to take them.”

Of the truly democratically governed cooperatives, few in the U.S. have reached significant scale in terms of number of firms created, people employed, or revenue generated or were not able to stay viable over the long-term. “The history of worker coops is a mixed bag,” says Gar Alperovitz, co-founder of the Democracy Collaborative. “[Individual] coops have often tended to break down… or they get taken over if they are successful.”

The Evergreen Initiative consciously based it’s model on the Mondragon cooperative network in Spain (see DK).  Through the development of economically integrated networks of cooperatives rather than a single cooperative, Mondragon has been able to reach significant scale and demonstrate long-term sustainability, without losing it’s democratic principles. A single worker owned and managed cooperative on its own is most likely doomed to fail in a highly competitive global economy. However, an ecosystem of several worker cooperatives and support organizations can create an infrastructure that leads to sustained growth and expansion (4)

Based on principles of community wealth building and sustainability, the Evergreen Initiative is launching  ten 50-person worker cooperatives in a variety of sectors over the next five years. Within the cooperative movement such a community wide effort is called a cooperative “incubator.”

Unlike the Venezuelan model, however, where funding and planning for such a network comes primarily from the State, the Evergreen model utilizes a network of private, for profit and nonprofit institutions, along with (but not primarily reliant on),  state funding sources to provide the capital for a network of cooperatives.

The Consortium believes that business interests and social goals not only can co-exist, but, by working together, increase the success of the project in a way that State run efforts to eliminate poverty cannot.  To this end, their mission includes environmental goals to “green” the neighborhood and reduce crime rates,  as well as providing good, living wage jobs and democratically controlled workplaces. According to the consortium, economic democracy does not reject the role of markets, but rather de-emphasizes the primacy of the profit maximizing motive among economic decision makers.

Anchor Institutions.

The Evergreen initiative is designed to meet not only its goal of job creation in a depressed area, but to also meet the needs of the few remaining affluent institutions local to the area from its heyday as a manufacturing center. These industries (hospitals, universities, nursing homes, cultural institutions)are  known as “anchor” institutions because they  “anchor” the community’s economy by providing a consumer base for the new cooperatives and the job growth they will generate. Basically an import substitution model,  the effort is unique in that Evergreen is building on the purchasing power of the area’s large hospital, university and other anchor institutions, which buy some $3 billion of goods and services a year—virtually none of which, until recently, had come from local business.

The Evergreen Cooperatives and their anchor institutions are linked through the Cleveland Foundation, a nonprofit corporation, and the Evergreen Cooperative Development Fund, a revolving loan fund established for the express purpose of creating a second generation of  new cooperatives from the profits of the early cooperatives.
The Evergreen Cooperative's geographic reach is, at first glance, relatively small, it’s specificity is critical to the model. In the case of Cleveland, it encompasses what is known as "Greater University Circle," a collection of the six impoverished neighborhoods surrounding the anchor institutions. By focusing on a small area the benefits of employment are more concentrated in neighborhoods and therefore more readily apparent, for one, and businesses that participate in the model tend to be uniquely suited to their environment.

Progress.

Although the Evergreen Initiative started only recently, it has already experienced some growth and anticipates more. As of August 2010, not one year since opening, the Evergreen Laundry (a mid sized capital intensive commercial laundry) and Solar (which installs solar panels and sells solar energy to the large commercial establishments in the area as well as weatherizing homes) employ more than twenty residents and anticipated increasing the number of local employees to 50 per cooperative.  Based on first year growth, Ohio Solar is already expected employ more than 100 people in the next 3-4 years, doubling the original projection. The Greater University Circle Neighborhood Voice, a bi-weekly print and online news source focusing on the University Circle-area neighborhoods, has just started printing. Later this year the plan calls for the opening of  another co-op advancing large-scale urban agriculture—something missing in an area that spends $7 billion on food shipped in from California, Arizona, and even Hawai‘i. Evergreen City Growers will build and operate a year-round hydroponic greenhouse located in the heart of Cleveland capable of producing more than 3 million heads of fresh lettuce and nearly 1 million pounds of basil per year. The company will employ about 50 local low-income residents If Evergreen reaches its five-year goal of launching ten firms with 50 employees each, then 1% of all GUC residents will be an Evergreen worker-owner. However, Evergreen’s long-term goal is to build at least 100 firms, so that the scale of impact is tenfold. To date it has raised $15 million dollars from nonprofit foundations and anchor institutions. Based on it’s initial four year record, Evergreen has clearly demonstrated it’s ability to raised sufficient capital to create economies of scale and capital intensive projects.

The Evergreen Initiative has also held true to its goal of creating good local jobs for low income and minority members of the community, many with little education and previous incarceration records. Initially, each worker is hired for a six-month probationary period at $8.00 per hour. After a successful performance review, the employee is offered the opportunity to become a part-owner of the firm. The cost to “buy in” to the firm is $3,000 and is paid through a 50-cent per hour levy in their upgraded $10.50 an hour salary once they become a worker-owner. As a worker-owner they receive full health insurance, a vote in governance, and a share of the profits. After eight years, employees are expected to own about $65,000 in assets.

Evergreen vs. Mondragon – Similarities and Differences in Private Sector Models.

While the Evergreen Initiative has several key similarities to the Mondragon model on which it is based --originally developed in a locally homogeneous minority community, designed to create jobs in a depressed economic area, based on the development of a network of worker owned and managed cooperatives  --  it differs from the Mondragon model in several key ways:

1)  Mondragon based its plan on the development of human capitol. It educated and trained  the workers first. It then established a credit union (Caja Laboral Popular) made up of workers and built upon member savings and social security. The workers determined the nature of the projects and slowly built, with some initial state funding, the capital to support their cooperatives.

Evergreen Fund managed by Shorebank, an existing private nonprofit enterprise, capital
from the City of Cleveland, foundation grants and “anchor institutions (private hospitals, universities, etc.). In the Evergreen Initiative, the leading force is the consortium of Anchor institutions and nonprofits who designed the program. Thus the type of cooperatives, who is hired and the working conditions will be initially determined by the needs of the consumers and the social goals of the philanthropic foundations instead of the workers.

2) While Mondragon cooperatives are organized in primary and secondary cooperative groups, establishing horizontal networks with the workers as the primary focus. Evergreen cooperatives are established as individual cooperatives selling unrelated
products that are networked with anchor institutions, non-profits, and city agencies, establishing a vertically integrated network with the Consortium institutions at the top.

3) Mondragon was started in the Basque country of Spain The Basque’s had a nationalist orientation with their own language and a tradition of political radicalism and were  homogeneous in terms of ethnicity & culture. While the Evergreen Cooperatives are based primarily in an African American low-income community, which provides some ethnic homogeneity, it is significantly more racially, culturally, and economically diverse and situated in an economic tradition of capitalism and big industry.

4) While Mondragon has, over the past 60 years been effected by the pressures of developing in a capitalist economy to the extent that, as it has grown, it has become somewhat more hierarchical and somewhat less worker controlled, it still remains a strong example of how a strong network of cooperatives can establish social, egalitarian and democratic cooperative values within the capitalist system.

Problems Associated with External Leadership.

The Evergreen model is inherently more hierarchical. While the cooperatives are 100% worker-owned and eventually designed to be worker-controlled, they are embedded a larger structure where other stakeholders function in primary positions. Through the Department of Community Development, and a host of non-profits, Evergreen has been able to quickly erect a network of “support” entities. One foundation leads, another agency funds, one non-profit builds governance, and another handles finances. A set of formerly independent local organizations has re-oriented their individual activities to the common goal of launching cooperatives. Thus, presently, Evergreen is led by outsiders—leaders of organizations that are not based in the Greater University Circle neighborhoods. As a result, the local community was excluded from taking early positions of leadership. This contrasts with the Mondragon experience, which was driven by internal community leaders.

Though Evergreen’s worker-owners are predominantly low-income African-Americans,
current managers and the core leaders are predominantly middle- to upper-class whites.
The leadership team admit they need to address the challenge of recruiting skilled managers of color and creating clear promotional pathways for worker-owners into leadership positions.

The consortium recognizes that the network must create a governance structure that
creating a representative board with a clear jurisdiction that defines how the leadership team and other support organizations will participate in decision making over time.
At some point, developers who drive the start-up phase of a network must eventually either join the cooperative or devolve their decision making power to the members and worker-owners. One solution that has been suggested is to allow non-cooperative network leaders to run for positions on the member-elected board.

Originally, the Consortium was supposed to turn over management to the individual cooperatives within three years.  They have, not however, at this point done so.  The cooperative developers feel that the workers do not yet have sufficient expertise and commitment and that more time is required.  Some members of the consortium, however, feel that the problem stems from the fact that the workers have not been given a real sense of ownership and decision making.

Because the network dictates norms, practices and policies for individual firms, it is
critical that the network is strongly democratic for worker-owners. Otherwise the effort will create a false sense that individual workers have real control of their firms when they do not. This would undermine the creation of a culture of collective ownership.

CONCLUSION

It is clear from the above discussion that both the State sponsored and privately  sponsored cooperative models still have some problems with hierarchical structuring which can limit workers’ role in decision making and corrupt the very essential nature of participatory democracy. The bureaucratic dangers in the State model are evident. However, the capitalist environment in which the Evergreen Initiative has to operate makes it much more vulnerable to a long term loss of cooperative values.  While it might be a good progressive model for providing stability and good jobs in at the local level in a floundering economy, it’s long term projection as a transformative model is greatly compromised.

Recommendations for State sponsored models.

While the State sponsored models have often had problems of insufficiently developed educational components and oversight, especially in the large cooperatives, these can be corrected through an adequate desire by a socially oriented state, if the people pressure the government.

In order to consolidate themselves, Venezuelan cooperatives (and all democratic workplaces in general) also ought to institute mechanisms of coordination among themselves and with communities.In order to consolidate themselves, Venezuelan cooperatives (and all democratic workplaces in general) ought to institute mechanisms of coordination among themselves and with communities. One recommendation is that all enterprises give part of their profits to help the community which is currently not part of the cooperative law. There is the danger, however, that this would stress fledgling cooperatives, especially those with minimal resources.

In spite of the fact of the low success rate, the mere size of the cooperative movement and financial commitment to it from the government has resulted is a definite lessening of poverty and a stronger social orientation by the people.  This is clear from the fact that the Communal Council plan was defeated in 2008, but, through education and with the support of the people, was reaffirmed in 2009.
The biggest danger to the cooperative model in Venezuela or any socialist leaning state is the constant pressure from global capitalist forces to over-throw  the entire State apparatus, to which those of us who support socially oriented societies must be constantly vigilant.

Recommendations for privately funded models.

There are also some efforts to overcome these limits of the privately funded models such as the evergreen Initiative.  Several states have enacted laws which are being proposed nationally which would create Corporation B type socially responsible for profit entities which would legally be entitled to withhold part of the profit to provide social benefits and could not be sued by other shareholders if they failed to make profit their primary consideration.
Decentralization and grouping cooperatives in accordance to their similarities, as is done in the Mondragon cooperative network to insure some homogeneity among cooperative members also increases horizontal networking and can limit excessive vertical networking leading to lack of workplace democracy.

A third choice.

At this time, unions have not been involved in either the Mondragon or Evergreen model and due to CIA involvement in the AFL-CIO internationally, there is some question as to the role unions have played in cooperative development.  In the past 25 years, the United Steelworkers have already experimented with transforming several closed union shops into cooperatives. Recently, however, the United Steelworkers signed an agreement to set up cooperatives in conjunction with Mondragon in the United States and a recent spin-off of the Evergreen Model is being established in Pittsburgh to rehire workers from a closed textile shop with the help of SEIU. The influence and possible development of a hybrid cooperative/union model will be discussed in Part 3.

(An Informal Partial Bibliography)

The State Model:

1) http://www.yesmagazine.org/.... Michael Fox, Venezuela’s Co-op Boom, May 11,2011.

2) Personal Interviews with Cooperative Members and representatives of Banco Mujer, Venezuela (Caracas & Lora, 2008). Rapp, Margaret. rap8643@aol.com

3) http://monthlyreview.org/.... Camila Piñeiro Harnecker.Workplace Democracy and Collective Consciousness: An Empirical Study of Venezuelan Cooperatives. 2007, Volume 59, Issue 06 (November)

4) The Lavaca Collective, Sin Patron: /stories from Argentina’s Worker-Run Factories,  Buenes Aires, Argentina @2004 lavaca Collective. Transl. @ 2007 Haymarket Books, www.haymarketbooks.org.

5) Castenada, Nora and the Women’s Development Bank of Venezuela, Creating a Caring Economy. Crossroads Books @ 2006 Global Wolmen’s Strike.

6) Personal Interviews with cooperative members from Nicaragua (Managua, Grenada, 1999).  Rapp, Margaret. rap8643@aol.com.

Private Sector Models:

1) Personal Interview with Evergreen Initiative cooperative developers. Eastern Conference for Workplace Democracy (http://east.usworker.coop). Margaret Rapp, July 10, 2011. rap8643@aol.com .

2) SteelValley.Org Green Coop Industrial Laundry Wins $250,000 from Heinz in Pittsburgh. 6/10/2011

3) The Rise Of Shared Ownership And The Fall Of Business As Usual
Jeffrey Hollender, Mon Jun 27, 2011

4) Ted Howard, Lillian Kuri and India Pierce Lee, The Evergreen Cooperative Initiative of Cleveland, Ohio:Writing the Next Chapter for Anchor-Based Redevelopment Initiatives. The Cleveland Foundation

White Paper Prepared for The Neighborhood Funders Group Annual Conference, Minneapolis, MN. September 29 – October 1, 2010

5) www.Community-Wealth.org.Howard, Ted  and Steve Dubb, and Gar Alperowitz,  The New Economy, the Summer 2009 issue of YES! Magazine.

NEXT MONTH: Part 3 -  The historic and current relationship between trade unions and cooperatives.

Originally posted to Anti-Capitalist Meetup on Sun Sep 18, 2011 at 03:06 PM PDT.

Also republished by Anti-Capitalist Chat.

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Comment Preferences

  •  Wow... (7+ / 0-)
    Currently 100 million people are members of 47,000 cooperatives in the United States.

    I had no idea there were that many.

    Oh...and thank you for your kind mention.

    De air is de air. What can be done?

    by TPau on Sun Sep 18, 2011 at 03:14:59 PM PDT

    •  You deserved it. Would apprciate some of your (4+ / 0-)
      Recommended by:
      NY brit expat, TPau, elwior, mint julep

      substantive comments since we are working in the same area.  Thanks in advance.

    •  100 m (0+ / 0-)

      that is probably a mistake. 100m is 1/3 of the u.s. population. must be for the entire world.

      •  good point, can we get a check on this number (2+ / 0-)
        Recommended by:
        Geminijen, elwior

        geminijen? unless it may also include members of various consumer cooperatives as well; since people often join many, that may make sense, but I think you have a point ...

        "Hegel noticed somewhere that all great world history facts and people so to speak twice occur. He forgot to add: the one time as tragedy, the other time as farce" Karl Marx, The Eighteenth Brumaire of Louis Bonaparte .

        by NY brit expat on Sun Sep 18, 2011 at 03:51:44 PM PDT

        [ Parent ]

        •  Yes, it is true! But, as I said below, this (2+ / 0-)
          Recommended by:
          NY brit expat, elwior

          includes all kinds of coops -- conservative as well as progressive (see my comment)

        •  NYB... (4+ / 0-)
          Recommended by:
          NY brit expat, elwior, mint julep, Justina

          I've been trying to get to get thru to you or Justina. I have some articles I would offer for the sight, but they are a little on the fringe of the subject. I sent them to you in an email twice and mentioned them in a comment on last week's diary. If you're not interested, that's fine...just say so and I will stop bugging you. The dead silence makes me think we just keep missing the connection somehow, so I keep trying.

          De air is de air. What can be done?

          by TPau on Sun Sep 18, 2011 at 04:05:05 PM PDT

          [ Parent ]

          •  Hey love, have been buried both due to a (2+ / 0-)
            Recommended by:
            mint julep, BlueDragon

            friend's visit and not being well. We definitely are interested, but I have not had a chance to take a breath. Last week I was in Wales and was not well, my friend leaves on Wednesday. We need to sit down and figure out dates. I am sorry and apologise profusely, the fault is mine, I have been buried and that is why I haven't gotten back to you, but life has messed me up a bit. Can we set up dates for the two pieces tonight or in a private email? I assure you that nothing untoward or rude was intended.

            "Hegel noticed somewhere that all great world history facts and people so to speak twice occur. He forgot to add: the one time as tragedy, the other time as farce" Karl Marx, The Eighteenth Brumaire of Louis Bonaparte .

            by NY brit expat on Sun Sep 18, 2011 at 04:14:47 PM PDT

            [ Parent ]

          •  TPau, Your Proposed Articles Are Incendiary.... (3+ / 0-)
            Recommended by:
            NY brit expat, TPau, Geminijen

            Just read one and part of the second, but both are likely to lead to great discussions.  Please, please post them so we can publish.  (Not sure just when, as have to confer with NY brit epat about dates and then check back with you to confirm your availability.)

            Thank you so much for two delicious reads!

            Convict Bush, Cheney and their torture cabal. Support single-payer health care,unions, and WikiLeaks.

            by Justina on Sun Sep 18, 2011 at 05:38:21 PM PDT

            [ Parent ]

      •  Actually, that is true though they are using the (3+ / 0-)
        Recommended by:
        NY brit expat, elwior, mint julep

        broadest definition of coops -- this includes all consumer coops, insurance coops, housing coops, investing coops, probably ESOP type worker-owned as well, though I'm not sure if they are included.  I've seen this figure in several places -- usually as 1/3 of the U.S. population (the way you expressed it). Bet if you really think about your life, you'll find you are in a coop somewhere.

    •  Not that unusual. (5+ / 0-)

      Credit unions are cooperative enterprises, which boast 87 million members in the United States.

      To this, add rural electrification cooperatives.  Indiana's network of them serves half a million homes, farms and businesses.  It's interesting to drive through reddest Indiana and go through town after town that greets travellers with a sign provided by the locality's electric cooperative.  

      "Politics should be the part-time profession of every citizen who would protect the rights and privileges of free people and who would preserve what is good and fruitful in our national heritage." -- Lucille Ball

      by Yamaneko2 on Sun Sep 18, 2011 at 05:21:19 PM PDT

      [ Parent ]

  •  Wow, thanks for this excellent diary (11+ / 0-)

    with such an amount of research geminijen, this is an incredibly informative piece on so many levels. I will come back and make a substantive comment, but I wanted to thank you for your hard work.

    "Hegel noticed somewhere that all great world history facts and people so to speak twice occur. He forgot to add: the one time as tragedy, the other time as farce" Karl Marx, The Eighteenth Brumaire of Louis Bonaparte .

    by NY brit expat on Sun Sep 18, 2011 at 03:26:36 PM PDT

    •  It's so long, I hope folks can take the time to (7+ / 0-)

      get through it.  Just couldn't leave anything out.  It all seemed to important.

    •  Second! NY brit expat. (7+ / 0-)

      Again, my thanks for all your work, Geminijen.  The section on Venezuela was especially good.

      Convict Bush, Cheney and their torture cabal. Support single-payer health care,unions, and WikiLeaks.

      by Justina on Sun Sep 18, 2011 at 04:04:23 PM PDT

      [ Parent ]

      •  thanks Justina. I hope to spend a year in (3+ / 0-)
        Recommended by:
        NY brit expat, mint julep, Justina

        Venezuela next year.  am going to try and hook up with banco Mujer or a similar project.  Got any contacts?  Also for cheap housing as I'll be living on my pension.

        •  I am so jealous of all you adventurous sorts... (3+ / 0-)
          Recommended by:
          NY brit expat, Geminijen, Justina

          I can't seem to disentangle myself from the capitalist pursuits (making enough money to survive) to do something so interesting. Enjoy it while you can!!!

          De air is de air. What can be done?

          by TPau on Sun Sep 18, 2011 at 04:20:51 PM PDT

          [ Parent ]

          •  I think that being retired has freed up (2+ / 0-)
            Recommended by:
            mint julep, Justina

            people a bit from ensuring basic needs; honestly, making enough to survive is not a capitalistic pursuit, it is a desperate need of all those that need to survive in a system based upon wealth and income inequality and private ownership of the means of production and distribution.

            "Hegel noticed somewhere that all great world history facts and people so to speak twice occur. He forgot to add: the one time as tragedy, the other time as farce" Karl Marx, The Eighteenth Brumaire of Louis Bonaparte .

            by NY brit expat on Sun Sep 18, 2011 at 04:24:12 PM PDT

            [ Parent ]

            •  Retirement....What's that??? I live in the States. (5+ / 0-)

              De air is de air. What can be done?

              by TPau on Sun Sep 18, 2011 at 04:30:37 PM PDT

              [ Parent ]

              •  I would laugh, but it is so true and it is not (4+ / 0-)
                Recommended by:
                TPau, Geminijen, mint julep, DawnN

                only a problem in the US, the same thing happens in the UK as well. People simply cannot afford to retire due to insufficient savings, break-downs of pension agreement, insufficient state pensions. I do not know when my husband will be able to retire and we are desperately trying to put money away for the future.

                "Hegel noticed somewhere that all great world history facts and people so to speak twice occur. He forgot to add: the one time as tragedy, the other time as farce" Karl Marx, The Eighteenth Brumaire of Louis Bonaparte .

                by NY brit expat on Sun Sep 18, 2011 at 04:41:24 PM PDT

                [ Parent ]

                •  Or you just decide you'll never have enough (4+ / 0-)
                  Recommended by:
                  TPau, NY brit expat, mint julep, DawnN

                  and lead your life "skating on thin ice," as the saying goes.  My pension helps, but since I started late and had to retire early (major medical problem), it's relatively small.  Still, it is something many many people no longer get at all, especially my son's generation.
                  One way I save money on the high rent in NYC is to live collectively -- seems like lots more young people are doing it these days.  NYC also has some older buildings that have rent restrictions (cheap).  You either have to get one of those or move to Podunk, Kansas and then you can't find work.

                  •  been trying to convince him of this, but I think (2+ / 0-)
                    Recommended by:
                    mint julep, Geminijen

                    that this is a class difference between us perhaps. I can cope with genteel poverty (I've spent a large part of my life living in it), but he is middle class (the child of doctors) and he cannot get past his fear of poverty.

                    "Hegel noticed somewhere that all great world history facts and people so to speak twice occur. He forgot to add: the one time as tragedy, the other time as farce" Karl Marx, The Eighteenth Brumaire of Louis Bonaparte .

                    by NY brit expat on Sun Sep 18, 2011 at 05:16:57 PM PDT

                    [ Parent ]

          •  Who says we make enough money to survive? (1+ / 0-)
            Recommended by:
            NY brit expat

            Seems like it's always a trade off.  Now that my son is out of the house I can take a break from my straight teaching job -- the glories of a pension!  we should only get it when we are young!

        •  Be Warned, Life in Caracas is Expensive. (2+ / 0-)
          Recommended by:
          Geminijen, tardis10

          Here in Mérida, a city in the Andes, it is much less so and, from my view, much nicer.  It is also much more temperate, as it is about 5000 feet high and surrounded by mountains that are 5000 to 10,000 feet higher.  I actually saw snow on top of the mountains last week, although it never snows here in the city.

          That said, there are lots more jobs available in the Caracas area, so....

          Here in Mérida, you should be able to live fairly well on social security, especially if you shop in the government markets (Mercals) or the large open air market.  The one good thing about reaching 65 is, at least here, I now have free local bus transport and, I am told, those of us of the "tercera edad"(third age) get one/half off on air transportation.  That makes a difference, as air fares here are not cheap relative to salaries.  

          Most people from Mérida take the 12 hour bus trip to Caracas when they go.  Twelve hours sounds awful, but the buses are cheap, fairly luxurious and have films and air conditioning.  (Too much air conditioning, so bring a warm coat or blanket if you come by bus!)

          It is well worth a long time visit (or moving here, if you can.)  The countryside is varied and gorgeous.  The social welfare programs are excellent and, miracle of miracle, you don't need to worry about insurance as medical, dental, optical and hospitalization are free.  (Now, if they could only tame the bureaucracy and the high cost of transnational drugs....)

          Oh, and I almost forgot The Major Social Problem -- street crime is bad, especially in Caracas, but the government's new national police force, created because of locally controlled police corruption, is making a real dent on the crime problems.  If Chavez is able to cure that illness here, even the oppositionist Catholic Church will have him beatified rather than, as they would now like, crucified.

          But, since most of the crime arises from drugs, the cure for that actually lies in the United States, where the problems have their origin.  The U.S. is the biggest illegal drug consumer in the world. If the U.S. would only end it stupid "War on Drugs" and legalize them, crime around the world would be cut in half, if not by three-quarters.  It is the high cost of drugs which feeds the drug cartels (which in turn feeds the corruption) and causes addicts to commit street crimes.

          Given Obama's past record, however, we can expect that to happen on the same day we get universal health care in the U.S.  Don't hold your breath.  

          Convict Bush, Cheney and their torture cabal. Support single-payer health care,unions, and WikiLeaks.

          by Justina on Sun Sep 18, 2011 at 08:49:11 PM PDT

          [ Parent ]

          •  Thanks. I had considered Merida, but I need to go (0+ / 0-)

            to one of the spanish schools to improve my Spanish if I'm going to do anything constructive at all and I had heard that the Spanish school in Merida was no longer.  Do you know?  also, I'd like to go to a school that supports the Bolivarian cause (I think the one in Merida did).  

            Got any suggestions?  (I was there in 2008). I can live with a family as a boarder so I tend to live pretty cheap.

  •  Great Info! Geminijen (6+ / 0-)

    Thank you for your excellent research.  

    I was involved in starting-up a cooperative here in Venezuela, which ran into some of the problems you mentioned.

    The one that did us in was that we all worked extremely hard to prepare a grant application to several government agencies.  

    For each one, we had to wait months for a response, and in each case, the folks in charge who originally were very enthusiastic about the project, were replaced by new people.  As it was considered an "old" project, it was not met with the same enthusiasm and there were more delays.  One agency actually approved it, and funding was approved at a high level, but then, due to the world economic crash, there was a budget-tightening move and we didn't actually get the money we needed.  

    In the interim, our cooperative folks got new job offers and went off on their separate ways.  At the very beginning of the cooperative, when enthusiasm was at its highest, it took several months to even get all the paperwork approves to be legally recognized as a cooperative. Bureaucracy!  

    We were confronted by more bureaucracy when we took the class from SUNACOOP on running the cooperative.  We learned we had to maintain 6 separate account books, by hand -- with no erasures -- which would be audited.  The account books were positively Dickensonian, as is much of the government bureaucracies here.  Many of their procedures seem to date from the 16th century.  

    I don't know how many other cooperatives faced similar problems, but it is not restricted to those dealing with cooperatives.  It seems that, throughout, the existing government bureaucracy is unable (or un-willing) to change their procedures so that ordinary people can comply with them.

    The government has passed some wonderful laws for social welfare and labor, but the long-encrusted bureaucracy stands in the way of  implementing them efficiently.

    The revolution certainly hasn't taken down the old forms of bureaucracy yet, and that is very much needed.

    Convict Bush, Cheney and their torture cabal. Support single-payer health care,unions, and WikiLeaks.

    by Justina on Sun Sep 18, 2011 at 03:54:43 PM PDT

    •  As I noted Justina, many of the procedural (6+ / 0-)

      regulations (forms)were required by state and local government agencies -- in fact, I have a sneaking suspicion that the complexity was intentional --you have to bribe someone to get past the paperwork! (Kind of like when they had the poll tax in the South -- they made it complex to prevent people from voting.
      Anyway, I know that just passing a law does not get rid of all the old bureaucratic rules.  The pasing of the communal councils was one effort to get around that bureacracy -- let's just hope that we don't get a new kind of bureaucracy to add to the old (like some of the problems caused by not carefully vetting the Vuelvan Caras training program before it started.  With the best of intentions to get a program out fast to serve more people, come mistakes....

    •  Capitalism is one ill we must overcome... (6+ / 0-)

      but bureaucracy is a whole other dragon that we also have to slay. Bureaucracy is almost always implemented as a method to control large groups of people and inhibit self-governance. I would like to see some posts on ways to subvert bureaucracy.

      De air is de air. What can be done?

      by TPau on Sun Sep 18, 2011 at 04:14:38 PM PDT

      [ Parent ]

      •  Tried to subtely suggest it in the article -- it (5+ / 0-)
        Recommended by:
        NY brit expat, TPau, mint julep, DawnN, Justina

        is always best to organize from the ground up -- problem is that it is usually slower so people get impatient and go for the big fix (Vuelvan Caras). Also, even when things get bigger, you can usually break them up into decentralized parts (like Mondragon's sub-categories of coops) so you have a solid base.

        course, you're right -- until we get rid of capitalism, these are only efforts toward a solution and will eventually get absorbed under the current system -- but just trying them helps people see "another world is possible" and, I think, is part of the transformative struggle.

  •  Just finished... (7+ / 0-)

    I know, I read so slowly.

    Originally, the Consortium was supposed to turn over management to the individual cooperatives within three years.  They have, not however, at this point done so.  The cooperative developers feel that the workers do not yet have sufficient expertise and commitment and that more time is required.  Some members of the consortium, however, feel that the problem stems from the fact that the workers have not been given a real sense of ownership and decision making.

    Good Lord, Americans can screw up the simplest things.

    I am concerned about this system. It reminds me of beginnings of the America compulsory school system. That system was also largely philanthropically funded. The backing for the system turned out to be major capitalist organizations using schools to train a future passive and complaint workforce. What seemed like a good idea to improve society turned out to be a very destructive institution.

    The fact that power has not been turned over to the coops on the weak excuse that they need more time to get education seems suspicious to me. Anyone else find that a little hard to swallow?

    De air is de air. What can be done?

    by TPau on Sun Sep 18, 2011 at 04:00:43 PM PDT

    •  Did you read the part where the External (6+ / 0-)

      white middle class leadership wants to keep control.  Of course, they have to blame it on the low income minority people they are "teaching."  "they just can't learn, so we can't turn it over to them.  In that respect, the State model, at least in Venezuela, has been somewhat better in trying to stay grassroots and serve the people they were designed to serve.

      BTW, I agree with you on the reason for compulsory education.  However, education is not a constitutional requirement, so the old compulsory system did end up providing basic education for a whole nation which many immigrants without money who came from countries where education was privatized have been very greatful for the compulsory education. Now, of course, you have a choice of home schooling or other choice alternatives (charter schools).  As a teacher, I detest the despicable way public education is run, but I am worried that eventually the charter schools as a whole (except for a few good ones for the rich), will not be any better (and as research grows, that is proving to be true). I'm afraid the right wing is just trying to use charter schools to end public education altogether by privatizing it. Hope not.

      •  I don't think they want to end public education... (5+ / 0-)

        It's been so useful to them. It is a person's first submission to authority. But teachers like you have made it hard for them to control education and make it do what they planned--provide docile workers. You d--n teachers keep actually teaching and making students think for themselves. That's what they want to destroy.

        The teachers who actually teach should go to the rich kids charter school and the burned out, underpaid barely capable teacher stays with the poor teaching submission to authority only. That is what it is really about.

        De air is de air. What can be done?

        by TPau on Sun Sep 18, 2011 at 04:28:42 PM PDT

        [ Parent ]

        •  I am not sure as what it seems that they (4+ / 0-)
          Recommended by:
          TPau, Geminijen, DawnN, tardis10

          want to do is to shift responsibility for education to corps and religious groups rather than the state; the result would be similar, but would remove the middle man and would save them direct money. That seems to have been the motive for the so-called foundation schools and academies that were introduced under Blair over here.

          When I was doing research for the thesis many years ago, I ran smack into the debate on education for the working class (adults and children) and what that education should consist. One position that seems to be making a resurgence was that working class people should be educated such that their education met the needs of their employers (and that they should be ideologically conditioned, see the society for the diffusion of useful knowledge for example). While people like Thomas Hodgskin supported the idea that working people should run their schools and learn what they wanted from a perspective that they chose (he established the london mechanics institute), this was deemed a serious threat and they were taken over by liberals that insisted on a rather different idea (see the above) of what the working class and their children needed from education. This has always been the predominant mainstream idea of the role of education, however they chose to disguise it; what is happening is that they are openly discussing this again and this was apparent in discussions of continuing education and what working class universities taught to students as subjects.

          "Hegel noticed somewhere that all great world history facts and people so to speak twice occur. He forgot to add: the one time as tragedy, the other time as farce" Karl Marx, The Eighteenth Brumaire of Louis Bonaparte .

          by NY brit expat on Sun Sep 18, 2011 at 04:38:05 PM PDT

          [ Parent ]

          •  But think how much easier it would be to... (5+ / 0-)

            control corps and religious groups than elected school boards.

            We should have a post on this subject as well. Perhaps even a guest post from someone doing for education what Mondragon does for business. Maybe someone from a Democratic Free School.

            De air is de air. What can be done?

            by TPau on Sun Sep 18, 2011 at 04:48:51 PM PDT

            [ Parent ]

            •  agree, that would be a great diary (1+ / 0-)
              Recommended by:
              Justina

              perhaps we can get a volunteer that would be willing to write on this subject?

              "Hegel noticed somewhere that all great world history facts and people so to speak twice occur. He forgot to add: the one time as tragedy, the other time as farce" Karl Marx, The Eighteenth Brumaire of Louis Bonaparte .

              by NY brit expat on Sun Sep 18, 2011 at 05:09:44 PM PDT

              [ Parent ]

              •  I'd take a stab at it but I have at least 4 (3+ / 0-)
                Recommended by:
                NY brit expat, Geminijen, Justina

                diaries on the boiler plate right now and STILL trying to finish the cursed manuscript.

                De air is de air. What can be done?

                by TPau on Sun Sep 18, 2011 at 05:26:31 PM PDT

                [ Parent ]

                •  let's see if we can get some new people (1+ / 0-)
                  Recommended by:
                  TPau

                  writing, at this point, it is primarily you, justina, geminijen and me with some support from a few others like geomoo and justjennifer and shanty sue. We have a great group of people that are members from a variety of perspectives, I am certain that there are those that have knowledge and information about this and it would take them far less effort to pull something together as they are starting from a base of knowledge.

                  "Hegel noticed somewhere that all great world history facts and people so to speak twice occur. He forgot to add: the one time as tragedy, the other time as farce" Karl Marx, The Eighteenth Brumaire of Louis Bonaparte .

                  by NY brit expat on Sun Sep 18, 2011 at 05:32:28 PM PDT

                  [ Parent ]

          •  Even some of the new charter schools -- those that (5+ / 0-)
            Recommended by:
            NY brit expat, TPau, mint julep, DawnN, Justina

            are geared for the underclass -- seem to want to educate children for a specific job.  On the other hand, I don't think everyone wants to be a doctor or lawyer (what the young Ivy league yuppies who come to teach in the ghetto cause they can no longer get a job in management believe).  There has to be respect for all types of honest and necessary work in society -- and that is definitely missing.  Everyone should get the education they want and need.  We have to stop stereotyping.  I'm all for education -- I was the first in my family to go to college -- but many of the jobs that now require a college at great expense would be better taught through an apprenticeship program -- education has just become another capitalist commodity -- especially now that they are trying to privatize it.

            •  back when we were young (I cannot believe (4+ / 0-)
              Recommended by:
              TPau, mint julep, Geminijen, DawnN

              that I wrote that) there were high schools dedicated to teaching trades and not only those geared towards pushing kids into university. I think that these type of schools served an important and useful purpose; I am wondering why they were abandoned by the powers that be. Many kids do not want to go (or are lacking the skills for) university and their needs are not being met. Schools need to provide for the interests and skills of students and not the interests solely of employers; those would be schools that serve the needs of those attending them. I agree with T'pau that an examination of the discussion of education should be undertaken and would be a great diary. Now we need to get a volunteer for the diary.

              "Hegel noticed somewhere that all great world history facts and people so to speak twice occur. He forgot to add: the one time as tragedy, the other time as farce" Karl Marx, The Eighteenth Brumaire of Louis Bonaparte .

              by NY brit expat on Sun Sep 18, 2011 at 05:13:24 PM PDT

              [ Parent ]

            •  Why is it education is limited only to the young?- (3+ / 0-)
              Recommended by:
              NY brit expat, DawnN, Justina

              If education was truly important to our society, we would offer it all the time to anyone who wanted it. If you did not force people to go to school, we could probably even financially achieve this.

              You can lead a horse to water, but you can't make it drink. If a teenager doesn't want to sit in school and learn Algebra, fine. Let them go out a dig ditches for a while. When they are ready and attentive it will take a lot less time to teach them.

              With remote education and peer to peer teaching we could have a much more useful education system for the same cost as this one.

              De air is de air. What can be done?

              by TPau on Sun Sep 18, 2011 at 05:34:50 PM PDT

              [ Parent ]

            •  My Theory: Everyone Should Have Manual Skills and (2+ / 0-)
              Recommended by:
              Geminijen, tardis10

              Intellectual Training

              My 9 weeks of a typing class in 9th grade earned my living through college and law school.  This was coupled with the benefit of having excellent public school teachers from kindergarten up.  But the typing class actually still feeds me fifty years later.

              An auto mechanics or electrician/plumbing course would probably have fed me more opulently as I wended my way through college and law school, but those courses didn't exist in my high school, especially for girls.  Boys who wanted to learn those trade skills were shunted off into the local technical school which offered them, not girls, those programs, leaving the girls to beautician and culinary courses and  leaving the college bound kids with the good academic teachers.

              I'd vote for mandating the 12th grade of high school as a "Manual and Computer Skills" year, in which all kids would learn a trade and how to navigate electronic communications, repair hardware and write computer programs.

              One of the things I think our new, socialist economic system needs is citizens who are fully educated as whole persons, with minds and bodies.  

              Capitalism truncates human beings, allocating the vast majority to be mindless workers, cogs in a martially-run chain of production, while the chosen few get to use only their minds and not dirty their hands.

               We need to smash the notion that the vast majority are dumb and incapable of creative thinking, while the chosen, academically educated few make all the decisions about production and distribution, while the even fewer get to enjoy the majority of the profits..

              Workers cooperatives, at least those operating on the ideal Venezuelan model, do the thinking,  the labor and the owning and administering their cooperatives.   The worker as doer and thinker reunites the human qualites we all share, working and thinking together as a community, jointly determining what and how things are produced as well as where and how they are distributed, and how the profits are shared.

              Capitalism is an awful system, not only because it impoverishes the majority monetarily, but because in the very act of production it alienates man from himself, refuses to respect a worker's mind and creativity, while subjecting him to absolute external controls, be that of a human boss or a mechanical one that controls his every action.  

              We have to end this alienating, capitalist labor process. That is why it is not sufficient merely to re-distribute the profits of capitalism more equitably, we have to abolish a system whose end goal is making profits, not serving the needs and aspirations of live, breathing, thinking human beings.

              To create a new, human economic system, everyone must be educated to think and to do.

              Convict Bush, Cheney and their torture cabal. Support single-payer health care,unions, and WikiLeaks.

              by Justina on Sun Sep 18, 2011 at 09:45:54 PM PDT

              [ Parent ]

              •  I have always found it an interesting class (2+ / 0-)
                Recommended by:
                Justina, tardis10

                distinction that people think there is no intellectual effort in manual work -- have they ever tried trouble shooting car repairs?  Do they know that those of us who come from craft families are sometimes amused as people who cannot fix anything themselves unless they can do it with a delete key?
                I totally agree with you, Justina.  I have personally found my favorite people are "cross class" who tend to value both types of labor.

        •  One of the most fun things I was able to do (5+ / 0-)
          Recommended by:
          TPau, NY brit expat, mint julep, DawnN, Justina

          teaching was expose the capitalist system (I taught history and economics to both k-12 and union workers.  I frequently got away with it because I was a nice white middle-aged lady by the time I went into the system, so I just closed the door and did my thing.  Sometimes, I would get caught and chastised -- pleaded innocense and naivete as long as I could. You should have seen it when I had the Dead Presidents in my class. Eventually, they figured it out.  but in the meantime, my students and I had some fun.   Nothing is more satisfying than getting past the propaganda and waking young people up to the realities of life.

        •  Or we should use public school choice schools (5+ / 0-)
          Recommended by:
          NY brit expat, mint julep, TPau, DawnN, Justina

          that are publicly funded and run by the unions (they exist) and set them up as cooperatives (with all the teachers, parents  and students being coop member - one vote each).

          •  When my daughter was young and we had just... (4+ / 0-)
            Recommended by:
            NY brit expat, Geminijen, DawnN, Justina

            moved to Oregon, we had a choice of two schools. The traditional public school or the community supported "hippie" school. I got her to try the hippie school. The class consisted of three grades taught in a single room. The room was furnished with cast off bean bag chairs and couches and had a paper mache tree growing out of the floor to cover the ceiling with painted leaves. The teacher brought her dog to class every day.

            Every day started with circle where the students past a talking stick. History, math and English were taught by the students digging up an archeological site the teacher had planted the summer before with archeological finds. The students dug them up, researched what they were, categorized them and wrote scientific articles on their finds. They then created a museum for the parents.

            When the school board finally destroyed the school, by daughter went to the public school. She told me before she went she was glad because the hippie school had been just a bunch of games and she didn't think she had learned anything.

            A week later she was board to tears. We bumped her up a class and she was still board. Of the 12 kids in her hippie school class, we have kept in touch with 5. All of them were at the top of their public school class and are now in college. My daughter is on the Dean's roll and is doing Grad work on microbial DNA in her 3rd yr of Undergrad.

            We could have a different system.

            De air is de air. What can be done?

            by TPau on Sun Sep 18, 2011 at 05:45:15 PM PDT

            [ Parent ]

            •  I went to a similar school for the first three (1+ / 0-)
              Recommended by:
              Justina

              grades -- my parents, along with our other neighbors, fought for the school because the "big" school was too far away for young children to walk to alone (this was in Chicago). Interestingly, it was Public School and paid for by the Public Education system.  What they don't tell you it that their are a number of innovative "choice" schools (at least in new York) which are alternative, but fully public (teachers paid union wages, open to all children for free).  

  •  Thanks for this piece, Geminijen (6+ / 0-)
    As capitalist corporations have grown into multinationals, creation of maximum profit is based on financial aspects only.  Buying and trading of corporations and stock become further and further removed from the production of actual commodities. Profit becomes abstracted from the underlying real economy. Management increasingly ties wealth and profit to “money wealth” at expense of the wealth creation based on producing products and services people want made under humane, democratic conditions.  Considerations for a safe commodity of value, for retaining an experienced workforce do not apply. With the increased domination of financial capital, CEOs go for immediate, short-term maximization of profit by cutting workers at plants to increase the cost benefit ratio and moving plants and outsourcing jobs in pursuit of cheap labor. profits.

    Cooperatives offer a much more grounded way of encouraging democratization in the work place, stabilizing the workforce by emphasizing the group ethos over the individual.  Since the “stakeholders” are the workers, it is in their interests to make the actual product they produce successful.  This stabilizes the economy from the productive end.  Instead of maximizing money profit, it maximizes the use value of the goods produced—that is, the workers are rewarded by improving goods, keeping the enterprise solvent. In worker-owned cooperatives the orientation is toward building profitability by emphasizing the  use value for the workers as a whole rather than monetary value for an individual.   Instead of chasing around the globe looking for bigger monetary profits, cooperatives tend to focus on their local economy, where their life is. The workers’ goals often include a sense of how their work fits into the community.  They buy from other local producers, they are concerned about the education their kids will get in local schools, they are concerned about how their workplace effects the environment and the health of their neighbors. The shift in direction from financial profit for a few to the value of the enterprise to all the workers helps locally developed cooperative communities resist the pull of profit driven capitalism.

    I think with the long term unemployed being considered "unhirable" there exists a real vacuum, the same kind that led to the Evergreen cooperative. I'm hoping the one in Pittsburgh also gets up and running based on the Mondragon Model in Spain.

    It has its problems of course, but given that most Americans are not accessible to any kind of socialist leanings directly like Venezuelans so I find it inspiring, and even Venezuelan models have their problems. However, these transitions are going to happen with problems.

    I think it's imperative that all unions get involved in this, especially the Evergreen initiative because unions are part and got their start when Capitalism although exploitative, it wasn't really this predator models we have in the same sense today. When John Kenneth Galbraith wrote the New Industrial State, banks were not the major players when it came to capital accumulation like they are today, it was mainly the corporation and not that that's great, but the owners had stake in the company; the phenomenon for CEOs to loot the company for personal gain based on perceptions of rising equity prices circa Enron and Tyco(which was endemic of this phenomenon that is full scale now) and fraud was not as prevalent as it is today.

    In a way this has created the opening for the coop model in Ohio along with the free trade/WTO model that has shipped most of manufacturing and work overseas. Though it's hindering that this model(as opposed to others) wasn't pursued when labor had more leverage during the Great Depression for this to systematically have fewer bumps in the road, if the army of the unemployed, many who like it or not still believe in some tenements of the capitalist system demand more Evergreen type initiatives(or Spain's model) and coops, there is a viable future that is at least better than being controlled by what Thorstein Veblen called the leisure class which is an accurate portrayal of what Capitalism amounts to today and it's predatory nature.  There are going to have to probably be some labor law reform that takes some of what the Venezuelan government has done and workers must have a civil right to a union and to be part of a coop if they should choose along the lines you laid out.

    I personally find there is some hope here and i personally find this appealing though I'm not entirely anti-Capitalist, I believe this is something that can appeal to the masses and overcome the anti-socialist propaganda prevalent in our society because of the first bolded sentence above and what makes a real economy rather than what Hyman Minksi(where normally most of my economic views come from via his followers and others) correctly identified as the Ponzi economy we have now in the 60s.

    Thanks for the informing diary. This will be a complicated development with some problems, but it can't be worse than  a country of unemployed service center hosts to the parasites of capital and wall Street.

    Pro Life??? Conservatives want live babies so they can raise them to be dead soldiers!- George Carlin - 48forEastAfrica - Donate to Oxfam

    by priceman on Sun Sep 18, 2011 at 04:18:51 PM PDT

    •  Coming from the working class, I have always (6+ / 0-)

      respected those who were able to make a good product, even my old boss in the furniture making plant where I worked. Sure, he was a capitalist owner, but he was a first generation craftsman who came up with a good way to make Swedish furniture.

      Personally, I want to keep the pride in craft of a good business -- just get rid of capitalism's proft motive.  who says we can't make things cooperatively? I've worked in coops in the States ( a Bread company) and it was a lot more fun without a boss.

      As far as the role of unions, stay tuned for next month's article (part 3) which deals specifically with that issue.

      BTW, there was a large upsurge in cooperatives as well as unions in the thirties -- the same AHoles that rid the unions of their progressive character (Bozo Reagan springs to mind), also undermined the cooperative movement from that time.

      (P.S.  I'm optimistic too -- though we might have to go through some rough times before we get there. )

  •  I just wanted to say that after my second pass, (4+ / 0-)
    Recommended by:
    Geminijen, NY brit expat, DawnN, Justina

    I've learned so much. This was really a superb diary and thank you for the obvious work you put into it.

    De air is de air. What can be done?

    by TPau on Sun Sep 18, 2011 at 04:54:45 PM PDT

  •  Posting this on Facebook/Google+/Twitter (7+ / 0-)

    it's such a great educational piece.

    Please remember to Witness Revolution. It means so much to them that we pay attention.

    by UnaSpenser on Sun Sep 18, 2011 at 05:31:45 PM PDT

  •  Thanks, extremely informative. (4+ / 0-)
    Recommended by:
    NY brit expat, DawnN, Geminijen, Justina
  •  100 million? (1+ / 0-)
    Recommended by:
    Geminijen

    Can you tell me where you got that figure for the number of people who belong to cooperatives? According to the U.S. Federation of Worker Coops http://www.usworker.coop/... there are about 300 coops and 3,500 workers producing about 400 million in annual revenues.

    •  Actually, this figure is what surprises people (1+ / 0-)
      Recommended by:
      tardis10

      most.  I saw these stats in several places (though it is usually cited as about 1/3 of the U.S. population). dopn't remember where I got this exact figure, but this includes all types of coops such as credit union coops which serve 87 million  and electrical coops (which serve half a million just in Indiana).  See TexDem and  Yameneko2 in comments above.  True this does include many that are not really worker managed and don't necessarily have the kind of structure we want to see, but they are officially cooperatives.

    •  www.cemc.org/general/electric%20cooperatives.asp , (1+ / 0-)
      Recommended by:
      tardis10

      www.coopfcu.org/about-us/what-is-a-cooperative.html - Similarto What is a Cooperative? | Cooperative Center FCU | Berkeley ...

      These are two of the sites that quote that figure -- the first is from electric cooperatives.  

      Couse, since it comes from the web this doesn't mean it's accurate -- they already have my article up there as one of the sources for the same figures!

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