0 Responses to Why Aren't There More Worker Co-Ops?

  • j. christian says:

    The principles of neoclassical economics are a flashpoint in some Catholic circles, where the mainstream economist is derided for his “science” and unwavering belief that economic phenomena are defined by something akin to scientific laws. But what are we to make of this:

    An increasing percentage of Mondragon employees, for example, do not have an ownership stake in the company, but work for it much as they would for an ordinary business. But while this may be a solution for a particular co-operative business, it is not really a solution for the co-operative business model so much as a gradual abandonment of it.

    The Catholic criticism of mainstream economics is fair enough — get the anthropology in the correct order before positing homo economicus, we’re told. I sympathize, but if there’s an incentive against expansion because of share dilution even at Mondragon, how do we square this apparent inevitability with the insistence that politcal economy and economic institutions are not deterministic?

    (This is a bit off topic and might make a good topic for a separate post.)

  • Deacon Chip says:

    I don’t know that it’s necessarily that far off-topic. My issue with most discussions of economic “justice” is that they inevitably drift over toward equality of outcome at the expense of equality of opportunity. That is precisely the issue, it seems to me, with Mondragon and other worker co-ops.

    SOmeone has to set a relative value for the stuff being co-op’d. Whoever does that will be required to make value judgments as to the relative worth if various inputs to the system, and then to relate those values to outcomes. If we’re all OK with me being paid less than Blackadder because I only input potatoes while he inputs truffles (does anyone not-French really eat those things?), then we’re good. But when Blackadder becomes richer than me because his inputs are more valuable than mine, many Catholic sociologists will cry foul and seek to level the playing field. THAT’S when we get into trouble.

    Concentration of wealth, or resources, or whatever, into the hands of less than the entire society is inevitable, unless we desire to take everyone to the lowest comoon denominator. And remember: when everyone is at a subsistence level…the poor will STILL be with us, except that none of us will be able to afford largesse to aid them!

  • Joe Hargrave says:

    “If employers and employees find, for the reasons given above, that worker co-ops are less preferable than other forms in many circumstances, there is nothing wrong with that.”

    I really hope the assumption here isn’t that anyone ever said there WAS something wrong with it.

  • Joe Hargrave says:

    Deacon Chip,

    ” But when Blackadder becomes richer than me because his inputs are more valuable than mine, many Catholic sociologists will cry foul and seek to level the playing field. THAT’S when we get into trouble.”

    I agree. And Catholic social teaching is clear – men have a right to make a profit from their labor, to enrich themselves. They also have a MORAL obligation to use their wealth charitably (which is NOT the same as saying that the state should force them to; unfortunately we live in a world in which people can ONLY imagine obligations coming from the state, since they no longer believe in God).

    “Concentration of wealth, or resources, or whatever, into the hands of less than the entire society is inevitable, unless we desire to take everyone to the lowest comoon denominator.”

    I completely agree. But “less than the entire society” is very broad. It could mean almost everyone, or it could mean almost no one. What Catholic social teaching makes clear is this: in so far as POSSIBLE (the exact words of Pius XI and a paraphrase of JP II), we should look for ways to make more people full participants in the economic process – through degrees of ownership and control of the means of production.

    This doesn’t mean “do it, even if it will ruin the company or the economy.” It means, “examine each situation to discover how far this general principle can be applied, if it all.” And even BA is forced to admit that in some sectors of the economy it DOES work.

    In any case, we also have to remember that the aim of CST is to prevent or mitigate class warfare. The Church has always recognized a polarizing tendency in what we call “capitalism” and has suggested Distributism as ONE way of addressing it.

    The other ways – labor unions, and state assistance, have mutated into corrupt bureaucratic enterprises. In fact I would argue that it is because of a false hope that men in all classes put in these institutions that the real solution, Distributism, was never really tried on a mass scale.

    Now that the bankruptcy of organized labor and welfare-statism is evident, I believe the already empirically demonstrated upward trend in employee ownership (which I pointed out in this post:

    http://the-american-catholic.com/2009/06/25/worker-ownership-%E2%80%93-the-untold-stories/)

    will continue. Though some people make a career out of denying it, the dog-eat-dog individualism of the unfettered market does not and will not serve as the foundation of a stable or a just or a moral society. We are social beings, we are meant to live, to work, and to worship as a community (without negating our individual dignity or rights, of course).

    As a final thought, even Ronald Reagan supported employee ownership.

  • Micha Elyi says:

    Though some people make a career out of denying it, the dog-eat-dog individualism of the unfettered market does not and will not serve as the foundation of a stable or a just or a moral society.,-Joe Hargrave

    Dogs don’t eat dogs – despite the claims of those who make a career asserting it. However the 20th century experience with unfettered collectivism demonstrates that socialists do eat other socialists.

    I am pleased to see Blackadder’s article explaining that worker co-ops are rare not because they are wilfully suppressed by Secret Masters of Political Economy (SMOPEs) but because they are naturally selected against by people’s own individual choices. I am amused by advocates of distributism who use mass-produced computers and a ubiquitous Internet to stump for distributism without regard to the fact that such tools subsist in an economy where large capital formations are commonplace. As Blackadder put it, “worker co-ops tend to be disproportionately concentrated in labor intensive, capital light industries.” These haven’t been the commanding heights of a Western economy since the Industrial Revolution, maybe not even since the days medieval Benedictine monks built water wheels, windmills, and forges adjacent to their monasteries.

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