Contribution to forum on cooperative theory

By Ken Freeland

The following is a slightly condensed response to the comments by Betsy Bowman and Bob Stone, and also to Jacques Kaswan.

Jacques Kaswan has done us all a favor by stimulating debate on the question of cooperative theory with his original, provocative essay. The ensuing response from Betsy Bowman and Bob Stone open up the field even farther for discussion of some badly neglected but vital areas and I find myself more anxious than ever to contribute to this dialogue.

On the whole, I found “Let’s make cooperative theory by talking—to one another!” a very inspiring piece…I believe that Jacques’ critical reply to Betsy and Bob is pretty much on target: “[T]he current market economy is far too powerful to be simply wished away. It makes more sense, to me, to discover how co-ops can best operate within a market economy, while at the same time increasing their capacity to offer genuine and increasingly democratic workplace alternatives

Before examining the strengths of Betsy and Bob’s offering, I think it is useful to devote considerable attention to what I consider this weakness of it: confuting the decommodification of labor—the mission of all producer- cooperation, and the decommodification of commodities themselves which fall under quite different aegis. Virtually all the examples offered by B& B are consumer cooperatives. Not one of them is involved in the provision of products or services outside of an immediate and closed area.

There are two relevant points to be explored: First is the age-old and never completely resolved tension between the producer co-op and consumer co-op approaches… Anyone who studies the history of cooperation sees this problem rearing its head again and again, and no one ever seems to discover the “unified field theory” that will allow both interests to dovetail seamlessly in a new synthesis.

Secondly returning to B & B’s examples: Certainly if you have a kind of community autarky, in which everything is produced locally for local consumption, then the prospect of decommodification of commodities becomes more plausible… But the “free market” system and the principle of comparative advantage” (that every area should produce those products or services for which it is naturally best suited) has shown itself to be a potent economic force that even further enhances aggregate productivity by any standards. Small is beautiful, yes, but how much of a price should we be willing to pay to decommodify commodities? If we have to double our labor time in order to produce all the decommodified products our community needs, and certainly do without whatever we cannot produce for ourselves in the bargain, what have we gained?

Is it a choice between the relative dynamism (and security) of mass production premised on comparative advantage, vs. the decommodification of all items of consumption, with labor-intensive production? (Before you answer, reflect in passing on the myriad tiny neighborhood steel foundries set up by Mao Zedong in China, and ask, where are they today?)

Back to Mondragon

Mondragon continues to attract the attention of cooperators worldwide precisely because, whatever its shortcoming, it represents a useful compromise: it ably promotes the essential cooperative principle of decommodification of labor, while fully embracing modern technology and mass production and other classical principles of economy. It is willing to beat the capitalists at their own game: to compete with them on equal terms. Precisely because it does so, it can thrive in the hostile environment created by capitalism.

B & B have make these two criticisms of the Mondragon model:

  1. Because it is engages in producing commodities, this makes it (a) vulnerable to the money system and (b) accounts for its hierarchical management…”

The first part of this question has already been dealt with, and very handily, I might add, by our authors, when they espoused a large-scale “Caja Laboral Popular” with the strict mission of empowering new producer coops and seeing to their ongoing need for financial services. I agree entirely that coops should avoid credit resources outside of those supplied by cooperative sources. There is no need to further discuss this problem which has already been theoretically solved.

The second part of this first criticism is trickier: is it a given that producing for a market in any way assures a more hierarchical management structure (in a coop) than producing for personal consumption? I don’t see the connection. It seems to me that the one is as susceptible to either democratic or dictatorial control as the other. I would like to challenge Betsy and Bob to elaborate on their thesis, and to offer some documentation to support it…

It is the very money/market system (which seems to bear the brunt of their attack) that enables cooperation to compete head on with capitalism and ultimately to supplant it in ways that are far more effective and enduring than other approaches. Money and market, when used properly, are an extremely efficient way to communicate need and satisfaction, counterbalanced nicely (in a just system like cooperation) by the recognition of the personal labor cost which any commodity entails (because the purchaser must produce to consume equivalent exchange values). Now, to vilify this elegant process because capitalists abuse it to amass great personal wealth by exploiting labor is tantamount to attacking free speech because some use it for slander. I will return to this point shortly.

  1. “(C)ommodity production…leads only to competition for markets between co-ops.” Well, if true, this is a very damning indictment. But why is it necessarily the case? It has always been my understanding that co-ops which find themselves in the same market tend to federate. Where in the world do we see coops in ruthless competition with each other for markets? Of course, if the co-ops, like their capitalist counterparts, posit “profits” as their highest priority, then such internecine strife is, alas, quite conceivable. But isn’t it just in the nature, in the very definition of co-ops, that they de-prioritize “profit” in favor of other values: decommodification of labor, workplace democracy, quality and social utility of product, ecological integrity, and so on? These values are not well served by competition with other co-ops for market share, providing that, following Bob and Betsy, they never cease to regard themselves as part of a “movement,” and not of some profit-thirsty monolith like its capitalist forerunners.

This brings us to the strong suit of Bob and Betsy’s treatment: the importance of the ethical or, as they boldly term it, the “spiritual” dimension. I want to thank them for bringing this aspect of cooperation to the fore, because without it this movement is a bit like a well-designed sailing ship with no wind (to give credit where it is due, this analogy is borrowed from classic American socialist thinker Daniel DeLeon). There is only so far that cooperative theory can go on the abstract plane of raw economics and material “success,” but we have hardly begun to scratch the surface of how much potential it may have once we begin addressing and focusing on the inextricable moral and spiritual dimensions of cooperation:

Cooperation: the moral alternative

Capitalism consists of an essential swindle by which a good part of the worker’s product is systematically appropriated by a dwindling class of owners. Its premise, “to each according to his ownership of the means of production,” leaves for labor only what it can command through collective bargaining, or, failing that, what the market will bear. Cooperation precludes this problem by advancing the moral equation of production to: “to each according to his work.” (It goes without saying that cooperation, properly presented, should logically/morally appeal to all the world’s progressive religions. It was, after all, the economic expression of the Christian socialist movement in the 19th century, and contemporary Muslims show a positive penchant cooperative economic forms.) As cooperators seek such opportunities not only for themselves, but actively for all other working people as well, the slew of social problems wrought by capitalist-imposed disparity between productive effort and reward, from cyclical unemployment, social dislocation, homelessness, inability of working people to afford medical coverage, etc., diminish accordingly. So does the worst scourge of capitalism—war:

Cooperation: the peaceful alternative

War has long been understood to be endemic to developed capitalism. It stems from this same disparity between productive labor and income, that leaves so much available for sale on the consumer market that the “surplus product” must go abroad in search of both markets to consume it, and capital itself has to wend its way abroad in an increasingly desperate quest for cheaper labor and raw materials so that its products can be produced more cheaply (and therefore consumer more freely) domestically without detracting from profit margins. This friction of many countries seeking the same limited resources and markets often takes on a military expression, and most wars of the last century are easily reducible to such underlying dynamics. Cooperation, because it resolves this internal antagonism between capital and labor, securing both in the interdependence between nations, each anxious to take advantage of its own comparative advantage once freed from the exploitive grip of independent capital.

Cooperation: the environmentally safe alternative

There is no reason for cooperators to rape the environment. They do not seek megaprofits, and do not intend to live in any other environment than that community they work in. Capital ceases to be mobile once it is in the hands of working people. There is no profit in environmental despoliation for those who have to live personally with the results.

Cooperation: the classless, democratic alternative

Let’s face it: every time we buy a product produced by a capitalist factory, we are literally buying into a class-divided future. These factories not only produce commodities, they reproduce social relations of domination and exploitation by one class over another. To buy a product made by a cooperative alternative means to buy into a future of democratic control by working people over their own workplaces, and productive relations between “freely associated producers” who regard one another as social equals, and who seek to maintain this relative equity.

Suppose now that this cooperative movement could attract a significant number or people who are sufficiently morally committed to its success as to agree to condition all of their consumer purchases by this understanding. Given such a captive market (made even more secure by the formation of consumer cooperative retail establishment s), given the development of an efficient and accessible Caja to finance similar cooperative ventures (and to help galvanize existing ones), and given a burgeoning network of cooperative industries each which tithed itself in order to help finance similar opportunities for others until no worker is without them – given all this “spirit,” could such a movement fail? It was Henry Davis Thoreau who said that building your castles in the air is fine, but you have to build your stairway from the ground up. Let’s start with what is do-able: the decommodification of labor in our generation. The rest we shall talk about later.

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