Talk for Article "Will worker cooperatives help stabilize wealth inequality?"

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    The notion that workers owning a business is somehow Marxist rather than capitalist is not an accurate view of this issue.

    Contract law (people agreeing to exchange things on certain voluntarily agreed upon terms) is the basis of capitalism, not who is the owner, so workers getting together to run a business is an entirely “capitalist” or market-oriented effort because it is a voluntary association. References: https://en.wikipedia.org/wiki/Freedom_of_contract

    Framing this article in terms of wealth inequality is another Marxist assumption that does not make for an objective news story. Inequality is not inherently unjust or important. I don’t expect to run as fast as Usain Bolt. Is that unjust? What matters is how our wealth is obtained, not how it compares to others.

    My alternate framing would be to emphasize not economic class wars, but the simple fact that those who work at a business may have more knowledge of it, and more at stake in its success or failure, than potentially remote management. If this arrangement is more successful, employee wealth will be increased. References: https://en.wikipedia.org/wiki/Recreational_Equipment,_Inc, https://en.wikipedia.org/wiki/New_Belgium_Brewing_Company

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    Worker cooperatives are probably 200 years old. No way is this a new development. And the fact it hasn’t solved all the economic problems is evidenced by the failure to date.

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    Have you thought about interviewing economist Richard Wolff on this topic? You can contact him through his website: https://www.democracyatwork.info/about#contact

    1. [ This comment is from a user you have muted ] (show)

      I just sent out a request for an interview and possible Q&A. I’ll post his reply if I get one.

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    To couch the debate about worker cooperatives in Marxist terms or to talk about them as an alternative to trade unions is patent nonsense. Worker cooperatives will stand and fall on their own merits.

    One of the biggest challenges facing them is the banking and financial system that is inflexible to the funding of such enterprises. It may take a change in laws to make them accept cooperatives on a business basis.

    Another issue that would be worth exploring is the use of what is called “Islamic finance.” Islam does not tolerate the payment of financial interest that is the foundation of “Christian” capitalism. There is also the moral objection that anyone, non-Muslims too, should appreciate that interest must continue to be paid whether or not the business is doing well or whether or not economic conditions are favourable or unfavourable.

    Instead someone financing a business where Islamic finance prevails will effectively take a stake in the business and benefit from a share of the profits – and take a share of any losses. It is difficult to see Western banks doing that – when they made losses in 2008 the taxpayers picked up the losses. Islamic banking, whether one is Muslim or not, seems to have a much higher moral threshold than Western finance.

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      Hi Henry- Can you elaborate when you say “One of the biggest challenges facing them is the banking and financial system that is inflexible to the funding of such enterprises.”

      Do you mean banks are hesitant to finance a coop?

      The moral dimension of banking in the Islamic world does not seem about coops, but its interesting. Should WikiTribune pursue a story on this? Would you like to start something?

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        Yes, because banks (that at the best of times lack vision and imagination) don’t think they can get their heads around cooperatives.

        Secondly, most cooperatives are small businesses and small businesses are avoided by or bullied by banks.

        The solution should be cooperative banks. But the one in the UK (The Cooperative Bank) was run with such incompetence that it was taken over by hedge funds. Most of the “Friendly Societies” and mutually-owned building societies have been taken over by big, commercial institutions when the members opted to cash in the value and flog them off.

        And small, cooperative credit unions that could grow into cooperative banks are poorly run, under financed and over regulated.

        Governments have mouthed support for cooperatives businesses but not lent them real support or real money to get off the ground.

        There seems to be a ground swell of “social enterprises” with which I am not familiar and not sure the extent they are cooperatives but worth researching.

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          Would you be interested in helping with a section on cooperative banks? A few lines on what happened to the UK’s version would be very helpful. (You could do this when you have time).

          Also, do you know anyone directly involved in the cooperative moment? It would be great to gear their experience.

          “Social enterprise” generally means a business with conscientious focus. It’s a bit of a catchall. That’s not to disparage them, there are many social enterprises that do incredibly altruistic work. The complex of this arena would certainly make for a good story. WikiTribune should explore this, especially when there’s a news story on this.

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            I went ahead and added your ideas to the list. Change them as you see fit.

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