Thanks, PW, what encouraging news.
The dairy coops here are the best place for ice cream, but the supermarkets are undercutting them on price of milk, sadly.

Once upon a time, cooperatives helped build the prosperity of the heartland. Now, see American Crystal Sugar, which has empowered its management to lock out workers right as they made record profits.

Today a former CFO finally speaks out; 10 months after the lockout began. A lockout that was clearly instigated to break the union and the workers.

In the process, they have broken faith with the social compact that they themselves look to the federal government to provide them.

Pigs at the trough.

Shame on them.

[edit: read CFO’s letter to editor here: http://www.inforum.com/event/article/id/364408/group/Opinion/

UP with Chris Hayes panel discussed institutional ethics this morning. How corruption becomes the default operating principle of institutions of all sorts. ACS is a microcosm of Wall Street, Penn State/Sandusky, Enron, megaphoning media forwarding the lies that led us into Iraq—all of a piece.

Why’d they do it? Because they could.

Conversation worth hearing.

Wouldn’t hurt to make Eyal Press’ Beautiful Souls required reading in all business schools. And by the Four Horseman of the end of democracy: Rove, Adelson, and 2 Koch brothers….

Thanks for bring out this information.

The Mondragon story is quite inspiring.

And even the United Steel Workers working with them was inspiring, somewhat.

But I don’t consider the United Steel Workers a legitimate union:

In March, USW endorsed the candidate supporting Slavery in Bahrain, Barack Obama:

Legitimate labor unions don’t support Slavery. Ever.

I wonder what the fascist dictator Franco thought of this. He was the leader of Spain in 1956.

Sounds fair. An individual is more likely to have a successful life in that kind of economic system. I can see where professors fit in at Mondragon’s university. I wonder how they integrate artists. Open Admissions policy sounds pretty good.

this is remarkably similar to the point I have been making concerning how we need to phrase the union movement;

a union is a company that provides a product, when a company needs to purchase a product they don’t set the price the seller sets the price, the purchaser can negotiate with that price but in the end it’s the seller providing the service or product who sets/ agrees with the price

this post demonstrates that point very nicely

Hey PW – as Ann Landers used to say, thanks for the upper!

Oh my!
Whatever is a vulture capitalist to do?

Nice job PW, long time no see.

We could all use a bit of good news these days.

If you recall the worker-run bakery in San Francisco on which Michael Moore had a brief segment in Capitalism, A Love Story, that bakery is a Mondragon enterprise.

In his monthly update for June Richard Wolff talks about Mondragon. His weekly update program on WBAI last week had a segment on Mondragon as will the show this week, where Wolff discusses some of the problems the corporation has had getting where it is. They are very forthcoming with information on themselves. Quite refreshing.

I’m all for importing ideas from Spain about economic recovery. Zimbabwe has some interesting ideas about land reform, too.

The future (?)

with the problems in spain and with the troika on the constant search to force neolib political change in euroland i wonder if mondragon will be, somehow, despite their successes, forced to change.

that this company was founded in the 50s is interesting, i wonder what generalísimo franco thought about this at the time…

According to an economist, David Ellerman, who worked in international development for the World Bank, it is much more important how a nation organizes its enterprises than how it organizes its markets. According to him, the problem with the Wall-Street model is that nobody has a long-term commitment to the success of the firm:

And the so-called “owners” (the far-flung shareholders) have been so atomized by the wide distribution of shares by Wall Street that the usual difficulty of organizing collective action across the widespread shareholders prevents any effective use their voting power. The aptly-termed “Wall Street Rule” prevails; if you are dissatisfied with the company, then exit by selling the shares. No one buys shares on Wall Street thinking they will have any real influence on management; the shareholders are in fact only passive investors like bondholders. As was pointed out by John Maynard Keynes:

The divorce between ownership and the real responsibility of management is serious within a country when, as a result of joint-stock enterprise, ownership is broken up between innumerable individuals who buy their interest today and sell it tomorrow and lack altogether both knowledge and responsibility towards what they momentarily own. [Keynes 1933, 235-6]

Albert Hirschman [1970] has made the well-known distinction between two logics: the logic of exit exemplified by markets, and the logic of commitment, loyalty, and voice which might be exemplified by organizations. The point is that we now have a whole “science of economics” that just assumes without second thought that the logic of exit is the only logic.

The economist tends naturally to think that his mechanism [exit] is far more efficient and is in fact the only one to be taken seriously. [Hirschman 1970, 16]

For instance, under the exit-oriented logic all labor questions are “labor market” questions while under the alternative commitment-oriented logic (e.g., in a Japanese-style firm), a labor question is a “human relations” or “human resources” question.[2]

Per the Wikipedia, Germany and the Netherlands have a lot of employee participation in corporate governance:

Corporate governance is “the system by which companies are directed and controlled” (Cadbury Committee, 1992).[1] It involves regulatory and market mechanisms, and the roles and relationships between a company’s management, its board, its shareholders and other stakeholders, and the goals for which the corporation is governed.[2][3] In contemporary business corporations, the main external stakeholder groups are shareholders, debtholders, trade creditors, suppliers, customers and communities affected by the corporation’s activities[4] . Internal stakeholders are the board of directors, executives, and other employees.

[...]

Some continental European countries, including Germany and the Netherlands, require a two-tiered Board of Directors as a means of improving corporate governance.[22] In the two-tiered board, the Executive Board, made up of company executives, generally runs day-to-day operations while the supervisory board, made up entirely of non-executive directors who represent shareholders and employees, hires and fires the members of the executive board, determines their compensation, and reviews major business decisions.[23]

Not coincidentally, Germany and the Natherlands are the two economies that are best surviving the euro crisis.

Trailer of a film to be released in the near future. Cooperative enterprise.

PW, great stuff.

Jane has talked in the past about how the once noble “protestant work ethic,” has been contorted into the the worship of “conspicuous consumption.”

Tweeted. Recommended.

The American Crystal Sugar lockout is one of the biggest news stories that most folks haven’t heard bupkis about. Thanks for mentioning it.

Yes!

I saw Gar Alperovitz speak about his book “America Beyond Capitalism” in Glendale a couple of years ago. He spoke quite a bit about coops and if I remember correctly Cleveland seemed to have more coops being developed than some other places.

At the time it was started, Mondragon was too small to be noticed, in an unfavorable way, by Franco; even when he died in 1975, it was not quite the size it is today. It also helped that Mondragon was the brainchild of a Catholic priest, and Franco, even had he been aware of Mondragon, would not have wanted to risk angering the Vatican, which was a key ally of his. Furthermore, any attempts to squash Mondragon would have risked drawing attention to it and to its growing successes — and the very fact that most Americans have no idea it exists should tell you how determined the PTBs are that we not know that there are working and viable alternatives to modern-day capitalism.

As I just mentioned to jimbowski, Mondragon survived Franco in large part because at the time he was alive (he died in 1975) it was still too small for him to notice, and because even if he had noticed it, it was the creation of a Catholic priest, and as the Vatican was Franco’s biggest ally, he wasn’t going to risk ticking them off by attacking one of their priests. (I suspect, when the histories of the post-capitalist future are written, Fr. José María Arizmendiarreta will be ranked alongside Gandhi and Marx and Lincoln.)

As for whether they will be forced to drop their economic democracy because of the current global crisis: Not a chance. Their economic democracy makes them stronger and better able to weather the sorts of crises that plague capitalist economies. Watch or just listen to this video (the pertinent stuff starts about forty minutes into it) and you’ll see/hear why. (The biggest problem they’ve been having lately has occurred when training various persons from other countries who have come to study the Mondragon model, particularly those persons from authoritarian cultures — such as, ironically, China, which while it’s nominally ‘Communist’ is still set up along the same authoritarian-feudalist lines that have existed for millenia. These persons often don’t feel they have the right to partake in the sort of wide-open debates that are Mondragon’s lifeblood.)

Exactly. Long-term commitment beats short-term vulturism any day of the week.

For example: The Mondragon folks have had to deal with the effects of the global crisis, just as we all have. But since they aren’t a capitalist corporation, they don’t have to worry about pumping up stock prices by moves that provide short-term gains at the expense of long-term viability. Also, their highest-paid workers make at most just six times what the lowest-paid ones do — the average disparity between an American CEO and his/her lowest-paid worker is more like 300 times — so there isn’t a small group of bigwigs sucking up most of the enterprise’s profits.

This means that when the part of Mondragon that makes washing machines (and in an ultramodern high-tech facility, mind you) notices a slackening of demand for such items, they don’t just tell 2,000 workers “here’s your last paycheck, get out of here”. The workers themselves figured out who would want to take a (very well funded) retirement, and who would want to be retrained to work elsewhere in the Mondragon enterprise. Not a single person was laid off or let go; anyone who wanted to keep working was able to keep working.

Naomi Klein, Avi Lewis:

“In the wake of Argentina’s dramatic economic collapse in 2001, Latin America’s most prosperous middle class finds itself in a ghost town of abandoned factories and mass unemployment. The Forja auto plant lies dormant until its former employees take action. They’re part of a daring new movement of workers who are occupying bankrupt businesses and creating jobs in the ruins of the failed system.”

“With The Take, director Avi Lewis, one of Canada’s most outspoken journalists, and writer Naomi Klein, author of the international bestseller No Logo, champion a radical economic manifesto for the 21st century. But what shines through in the film is the simple drama of workers’ lives and their struggle: the demand for dignity and the searing injustice of dignity denied”

http://www.thetake.org/index.cfm?page_name=synopsis

The Take is a very interesting and well produced film. Well worth watching.

particularly in the light of the massive rerun of what happened in Argentina.

Oh, yeah. The subject of Argentina post-2001 has been studiously ignored by the American establishment media, and for the same reasons as they ignore Mondragon: It shows that there is another way, and that one doesn’t have to kowtow to the IMF or to any other enforcer of neoliberalist “Washington Consensus” capitalism to thrive.