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The co-operative is a successful, mutually beneficial system of production which has been systematically suppressed from business schools, economics classes, and Marxist theory throughout the world.
In a corporation, workers have no say in the company's goals, which are determined by a board of elites and a group of outsiders whose only aim is to make money (shareholders). In a co-operative, the organization is controlled by the workers, who make decisions that will benefit themselves.
Some of the obvious problems solved by co-operatives:
- Worker exploitation. No worker would use an organization to exploit himself.
- Outsourcing. No worker would use an organization to fire himself!!
- CEO pay. No worker would use an organization to vote to take an unreasonable money from himself and give it to an upper manager.
Main problem of a co-operative:
- Horizontal and vertical integration, which can streamline production, distract a co-operative from its motives (to support its workers) by including different kinds of workers in the voting process. But competition, the main tool of economics, is still quite in force; the economy would still run smoothly if all our corporations became co-operatives, we'd just have more businesses, and smaller ones.
Co-operatives succeed in a free market
Co-operatives are not only successful, they have demonstrated success in a free market to the extent that you already recognize their brands, and most people don't even realize the brands represent "non-profit". Here are some examples of co-operatives today:
- Ocean Spray - cranberry growers
- Best Western - hotels
- Land'O'Lakes - farmers
- FTD - florists
- R.E.I. - outdoors equipment
- Sunkist - orange growers
- Cabot - cheese
These organizations function like normal corporations. They invest in R&D and clean up after themselves. They advertise, operate efficiently, and lobby Congress. But they do all of this in a way that is satisfying to the owners of the company-- its employees.
Co-operatives are systematically suppressed
In the business world, neoclassical economists starting with Nobel Prize winner Paul Samelson have aimed to suppress the existence of the co-op from economics-- by omitting it from textbooks and classes. They replaced it with a fairy tale that runs like this: "When a group of people wish to work together to produce something, they can sell it all under an individual's name, work in a partnership and share culpability like lawyers, or create a corporation run by shareholders, creating a profit motive."
This is one of the biggest lies you will be taught in economics class. A corporation need not have transferable shares. In fact, it is against the interest of the community, society, and the planet to make shares transferable. But this goes unexamined. The haphazard way the corporation was set up in the 19th century, which you can learn about by watching the movie The Corporation, is obviously not the only way it could have worked. The alternative-- the co-operative-- is the way it should have happened.
Some papers noting this:
- Chamard, John (2004). "Co-operatives and credit unions in economics and business texts: changing the paradigm" The International Journal of Co-operative Management Vol. 1, No.2, 34 – 40.
- Hill, Roderick (2000). "The Case of the Missing Organizations: Co-operatives and the Textbooks" Journal of Economic Education (Summer)
- Kalmi, Panu (2007). "The disappearance of cooperatives from economics textbooks." Cambridge Journal of Economics vol. 31, No. 4.
- Lynch, Lori, Marilee Urban and Robert Sommer (1989). "De-emphasis on Cooperatives in Introductory Economics Textbooks" Journal of Agricultural Cooperation Vol. 4.
(These papers are summarized in Daniel Schugurensky's talk, "What knowledge is of least worth?”)
The theory that has been invented as an alternative to the damaging and inherently unequal corporation is Marxism. Marxism has never worked in practice; co-operatives have. Yet Marxists ignore the co-operative as a system of production.
- Bruno Jossa, "Marx, Marxism and the cooperative movement". Cambridge Journal of Economics, Vol. 29, No. 1
Movements that used the co-operative method
- Some forms of socialism [e.g. Robert Owen]
- Unions, which provide a parallel, co-operative power structure to corporations (which is unnecessary!)