Worker Cooperatives and the Right to Own

Worker cooperatives uphold democratic values, increase worker happiness, and worker productivity - so why hasn't the United States encouraged them?

As anyone who grew up under the U.S. public education system would know, Americans love to talk about the importance of democracy. The State Department’s website even states that “supporting democracy… promotes fundamental American values such as religious freedom and worker rights.

But the United States, up to this point, has demonstratively failed in both supporting democracy and promoting worker rights because, as Professor Noam Chomsky says, “You cannot have meaningful political democracy without functioning economic democracy.”

One of the key tenements of democracy, both political and economic, is that of choice. Without a free, uncontrolled choice, there can be no democratic will. This is a concept that is easily understood when you’re talking about politics. For example, imagine if in the 2020 Presidential Election, you went to the voting booth to cast your ballot but there were only two candidates listed: Joe Biden and someone you had hardly heard of prior to election day. Sure, you might be able to say that you had the free choice to pick between Biden and this mysterious candidate, but without knowing the policies or positions of him/her, would you really accept that Biden won a free, fair, and competitive election and say that he was a legitimate ruler? Under our current economic system, both the consumers and the laborers do not have a substantive choice between traditional firms and worker-run firms. Looking around Utah, and even throughout the U.S., there aren’t many worker co-operatives. One of the biggest, and only, employee-owned, worker co-op in the state is WinCo, but even that isn’t a major player in the local economy, compared to larger grocers like Walmart, Smiths, or Harmons. There is no choice when a laborer or consumer has the choice between one majority employee-owned company out of hundreds of thousands of businesses in the state of Utah.

The lack of economic democracy becomes apparent when you look at the structure of the traditional company. These structures are nothing short of tyrannical institutions: Bosses can do whatever they want, whenever they want, for whatever reason they see fit, and they can completely disregard any input by their own employees. The U.S. may have been the first politically democratic country in the modern world, but we have yet to “Democratize the Enterprise.”

Worker co-operatives differ from traditional firms by doing away with the typical employer-employee dynamic as the workers themselves own and run the business. In a co-op, the workers may be able to vote on a great number of issues that affect them. They would get to vote for their managers, so that the managers are more accountable to the workers and create policies that will help the average member of a firm - instead of just the pockets of the board of directors - and they could even vote directly on some of those policies. In a society that claims to love democracy, it makes no sense that the place adults spend most of their lives is also among the most authoritarian institution that we have to deal with.

This may be an idealistic argument, but there are many other benefits in support of worker co-operatives. For example, co-ops are economically better than traditional firms, ignoring profits and returns on investments, in a number of key areas. Why should we ignore profits and R.O.I.s when evaluating two different types of businesses? Profit is not the goal of these firms as they value worker autonomy and bolstering the local community more than making a quick buck. Democracy at Work writes, “The more participatory cooperatives are, the more productive they tend to be,” this is because these companies can work better when maximizing profits isn’t the only goal. These sentiments are backed up by a slew of economic studies that have proven that co-ops tend to be more productive and efficient than traditionally organized businesses.

On top of the increased productivity, they are more resilient than capitalist businesses. The executive director of the US Federation of Worker Cooperatives told, “Instead of mass layoffs, the workers, who are the equal owners, strive to find collective solutions. Worker-owners might vote to take voluntary pay cuts so no one person loses their job, and worker committees might try to find new markets the cooperative can expand into.” One study from 2012 found that worker co-ops in France and Spain were more able to survive and withstand the global 2008 financial crisis.

Additionally, workers are much happier when they get to vote on how their businesses run and they feel less alienated from themselves and from society. As Chomsky once said, “…as long as individuals are compelled to rent themselves on the market to those who are willing to hire them, as long as their role in production is simply that of ancillary tools, then there are striking elements of coercion and oppression that make talk of democracy very limited, if even meaningful.”

Currently in the U.S., and especially in deep-red Utah, the working class has not developed enough class consciousness that would allow us to start building dual-power. For the time-being, until we have built that level of awareness, we need politicians, like Bernie Sanders, to push for legislation that would establish the ‘Right To Own’ for all employees, similar to what was proposed by the Labour Party under Jeremy Corbyn’s leadership. The Labour Party’s proposal sought to make “employees the buyer of first refusal when the company they work for is up for sale” (Labour Party Manifesto 2017, Pg. 19) to form a co-operative with a loan from the government. In the US, the Department of Labor would oversee this policy along with the Department of Treasury as they would work together to give out the grants to the various firms who request them.

This type of government action will not only help build the cooperative sector of our economy, but it will also help make the working class of our country become more aware of their power as laborers and showcase how a better world is possible without having a tyrant run the workplace.

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