Cooperatives and Workers-Owned Enterprises as Transformative Strategies

Immanuel Ness

Report on the Rosa Luxemburg Foundation Conference, Berlin Germany, November 3-5, 2011

 

Is the time right for worker-owned enterprises to socialize or nationalize traditional businesses to create a more humane economic system?

That and other questions were debated at an international conference on cooperatives and advocates of worker self-management and control.

Walter Vogt, IG Mettal; Immanuel Ness, Brooklyn College-CUNY; Dario Azzellini, Johannes Kepler University in Linz, Austria

The Rosa Luxemburg Foundation Rosa-Luxemburg-Stiftung) hosted a historic international conference on cooperatives and worker owned enterprises in Berlin in early November, bringing together leading activists, labor officials, and academics from throughout the world. The conference was of singular importance as the Foundation regards North America and the Global North as a region of significant political and economic struggle for the working class. RLS organized the conference to support its educational mission to provide political education to advance working class democracy and socialism in Germany and throughout the world. A common theme unifying the participants of the conference was the belief that worker owned cooperatives are a viable alternative to private businesses and will grow in significance as private businesses fail and workers lose their jobs in the private sector.

The global economic crisis of capitalism believed to have begun in 2007 has provided expanded prospects for new forms of worker organizations in businesses and enterprises. The resurgence of interest in cooperatives is motivated by a belief by more and more workers to transform the capitalist logic and philosophy that dominates the workplace throughout the world. Cooperatives and worker’s councils were examined as a viable replacement to traditional models of privately-owned businesses that only benefit the capitalist class and negate the aspirations of workers and communities.

The conference, which took place November 3 to 5, 2011, was organized to challenge the principle that private ownership and domination over workers is the only form of organization within enterprises.

The conference included a vibrant discussion of worker cooperatives as a viable and necessary alternative to current capitalist control. Each examined the challenges and significance of forming cooperatives to achieve economic democracy:

  • Rick Wolff, professor of economics at the University of Massachusetts and the New School;
  • Alex Demirovic of the Berlin Technical University;
  • Sonia Buglione of James Cook University, Cairns, Australia; and
  • Ulla Plener, a German historian and editor of Jarbuch, a socialist working-class journal, examined the conceptual challenges in achieving economic democracy.

Rick Wolff argued that in the current capitalist crisis social transformation through the formation of cooperatives is inevitable: “The idea of workers self-directed enterprises is that the workers displace and replace the capitalists with themselves. This has to be the next step in the process of transformation.” As capitalist enterprises consistently fail and do not provide workers with economic security, new forms of cooperative worker ownership are an inevitable outcome.

Union representatives were among the presenters, including Walter Vogt of IG Metall (Germany’s largest manufacturing union) and Carl Davidson of the United Steelworkers. I commented on questions of the relationship between unions and cooperatives.

Conference participants examined and debated an array of forms of worker-ownership that can and do viably operate independently of private business. The conference participants were motivated by the necessity to describe and analyze forms of ownership that reflect the interests of workers and communities. Cooperatives were viewed as a feasible and practical alternative to private enterprises that have thus far proven ineffective if not destructive to protecting the economic stability of the working class and environmental sustainability.

In addition, the Yugoslav and Cuban models were discussed by Jörg Roesler of the University of Arts in Berlin, Birgit Daiber of the Rosa Luxemburg Foundation, Goran Music of the European University Institute, Camila Piñiero Harnecker of the University of Havana, and Boris Kanzleiter of the Rosa Luxemburg Foundation. Questions as to the actuality of cooperatives were examined by Tim Hunt of the English magazine Red Pepper, Bernd Röttger of the Research Institute for Workers' Education at the Ruhr-University Bochum., Dario Azzellini of Johann Keppler University of Linz, and Marina Sitrin of the City University of New York Graduate Center. The efforts toward building a solidarity economy were examined by Rainer Schlüter, a leading expert and advocate of European enterprise cooperatives and Jessica Gordon Nembhard. Schulter and Gordon Nembard, also joined Piñero Harnecker and Hanz Bierbaum, vice chair of Germany’s leftist Die Linke Party on the closing plenary on transforming property relations.

 

Transformative Potential of Worker Control

Jessica Gordon Nembhard of GEO, at the Luxemburg conference

The conference panels explored the transformative potential of worker-owned businesses and cooperatives by investigating a range of practices around the world. Panelists presented on historical and contemporary experiences of recuperated factories and the development of cooperative enterprises in the Global South: chiefly Argentina and Venezuela, as well as efforts in the capitalist strongholds such as the United States, Germany or Spain.

The contemporary crisis of capitalism, rooted in the shift from the production and goods and services to the financialization of the economy of the world through speculation was the point of departure for the conference. A key question that was debated is how recent efforts to create cooperative economies may trigger a transformation of many enterprises dominated by employers.

The point of departure was the premise that ownership of the means of production is a central axis of social power to transform society in the process. Under contemporary neoliberal capitalism, employer ownership is failing to sustain the stability of workers. As such, efforts to create cooperative economies are engaged within capitalism with an effort to look beyond the system at a new democratic social economy. Examples were provided from a series of cooperatives throughout the world where cooperatives are formed or in cases where abandoned enterprises were expropriated by workers who have engaged in democratic efforts to resuscitate industries that have been destroyed by their employers. For example, the growth in worker cooperatives in Argentina since the economic crisis in 2001 has demonstrated that they present a viable alternative to private ownership of industry. Over the past decade worker cooperatives have grown in importance and are replacing corporate owned industries that are failing. The speakers noted the importance of changing capitalist power relationships through reshaping capitalist enterprises into cooperatives that reduce inequalities and develop the talents, expertise, and skills of all workers.

 

Current Crisis of Capitalism, Cooperatives and Labor Unions

A guiding theme was that the current crisis has inspired the speakers to rigorously question the present configuration of capitalist relationships in society. Speaker after speaker raised the possibilities for socializing and nationalizing businesses through employee ownership and self-administration. Moreover, the presenters also recognized the challenges cooperatives face in providing the funding to develop and maintain competitiveness within a capitalist economy. Opposition from the capitalist dominated nation states, and minimal (or the actual absence of) funding poses a serious risk to the maintenance of cooperative and worker self-managed enterprises. Given that workers have already formed successful cooperatives, and in some cases workers’ councils, the practical questions of democratic administration of democratic workers organizations in a global capitalist economy was discussed and debated among the panelists and participants.

Conference participants also addressed the relationship between worker cooperatives and labor unions. Examples drawn from the US and elsewhere demonstrate that democratic labor unions can provide an important means of representation, defend cooperatives from external threats, and help small worker-owned organizations provide health and retirement benefits. However, the role of the relationship between worker cooperatives and labor unions remains a challenge due to the need for unions to establish new institutional relationships with workers. While established trade unions do not have a tradition of democratic representation, they are potentially amenable to the formation of worker-owned cooperatives. A point of contention is the capacity of democratic left political forces in society to facilitate the transformation of capitalist dominated enterprises to self-managed worker cooperatives. Given the complex forces arrayed against worker-controlled enterprises, the question of social transformation remains a serious point of contention among workers, activists, labor unions, academics, and left parties.

Christina Kaindl, of the Rosa Luxemburg Foundation, was facilitator of the international conference on worker cooperatives and economic democracy. Catharina Schmalstieg was instrumental in the organization of the event.

The sentiment among most at the conference is that worker cooperatives will form an important part of the economy in the years to come. As capitalist businesses fail and workers are threatened by unemployment, cooperatives are a compelling alternative to the system to more workers who are vulnerable to the vicissitudes of the capitalist market. The conference provided incontrovertible evidence of the growing demand for democratic governance in the workplace. The examination and debate on worker ownership raised by the conference unquestionably expands the debate on the experiences, concepts and challenges of employee ownership and economic democracy.


 

About the author: 

Immanuel Ness teaches political science at Brooklyn College of the City University of New York. He is the director of the Labor Policy Institute and Deputy Director of the Graduate Center for Worker Education. He has been a labor organizer and has authored several books on labor, migration and social transformation. He is also the editor of Working USA: The Journal of Labor and Society.

Citations: 
When citing this article, please use the following format: Immanuel Ness (2012). Cooperatives and Workers-Owned Enterprises as Transformative Strategies. Grassroots Economic Organizing (GEO) Newsletter, Volume 2, Issue 12. http://geo.coop/...
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