The Workers' Paradise

June 28, 2010

The Democracy at Work Conference

Filed under: Movement — Tags: , , , — John McNamara @ 2:18 pm

I took last week off due to a couple of things. The most important of which involved my wife and I becoming “Domestic Partners” in Dane County. Five years ago, we married ourselves in a handfasting ceremony at one of the area’s First Nations* “mounds”. We decided to seek legal status for some personal reason, but it was also a fun experience. This week, I was going to continue the discussion about how co-operatives should treat their workers. However, three events have caused me to delay it. The first involves my co-operative, Union Cab, which will be having two informal membership meetings this week. The first involves dealing with frustrations about bureaucracy and “management’s punitive practices”** among other angst driven issues. The second involves my co-operative’s attempt at creating solutions for dealing with our current “smokey hut” where people currently enjoy their smokey treats but which will likely be illegal when Wisconsin’s smoking ban goes into effect on July 5th. The former has been called by a couple of stewards, the latter by the General Manager.

The last reason is that a couple of key deadlines will be upon us. As President of the US Federation of Worker Co-operatives, I find it necessary, even obligatory, to push our annual conference. The Apex organization of worker co-operatives in the United States will be holding its annual meeting and biannual conference in Berkeley, CA from August 6-8.

The deadline for a discounted registration is June 30, 2010.

The deadline for registration is July 5, 2010–you can still attend after this date, but we may not be able to count you in on the dinner and meals. REGISTER TODAY!

With the theme, “The Work We Do Is The Solution” hundreds of worker cooperative members and cooperative developers will meet at the University of California—Berkeley from August 6-8, 2010 to share information, strategies and tactics to make their cooperatives stronger as well as to help create new worker cooperatives. The US Federation of Worker Cooperatives sponsors the conference and holds its annual meeting.

Texas Populist Jim Hightower will be the keynote speaker. Other featured speakers include the Evergreen Cooperative project from Cleveland (featured in TIME and The Economist as an innovative economic development strategy), the Toxic Soil Busters youth cooperative from Worcester, MA which has city contracts to do lead remediation, and representatives from EdVisions, which is changing the face of public education by developing teacher-run small charter schools across the country.

USFWC Executive Director Melissa Hoover emphasized the theme of the conference, noting that, “Worker cooperatives can be economic engines that generate the surplus we need to tackle the big problems. They can create jobs that offer opportunities for meaningful personal and professional growth.   They can build community power and shared wealth.  They can choose to conduct business in a restorative and sustainable way. They can create a powerful values-based and principled framework for making decisions about work, industry, and the economy.”

The conference will be held at the Clark Kerr Conference Center. The 2010 Conference may be one of the most important meetings of the decade for those interested in creating a more sustainable economy.

The USFWC has created a nation-wide Peer Advisor Network to assist member cooperatives and start-ups with guidance from people working in worker cooperatives. Along with new capitalization efforts underway, there has never been a better time in the United States to start a worker cooperative. We have created a strong support structure for fledging cooperatives as well as existing cooperatives who may need a hand up.

We have worked hard over the last four years (since the NYC conference) to create a vibrant national movement. We currently sit on the edge of success. This is our moment to surge forward. If you read this blog with any regularity, we need you in Berkeley. We need you in the movement. The time for worker co-operaters and those that believe that our economy should mirror our values need to act today.

See you in Berkeley!

February 18, 2010

The Cleveland Model–Take One

Filed under: Movement,The Cleveland Model — Tags: , , , — John McNamara @ 7:00 am

Recently, The Nation sent out a broadcast with an article about the emerging worker cooperatives of Cleveland asking those of us in the bog-o-sphere to comment. As someone who has been an active member of a worker co-operative for over 20 years and involvement in the national and international movement for the last 4 years, I definitely have some ideas.

The folks are really doing this right. I spoke with one of the organizers of Evergreen Laundry a few years ago. They lined up the customers as part of the planning stage. The idea wasn’t to struggle as so many worker co-ops do in the beginning, but to start-up with a strong source of work (this was touch and go, but it appears that Case Western and other institutions will be sending their laundry to Evergreen). Second, the Mondragon style commitment to return 10% of surplus (the article calls it ‘pre-tax profits’) to a development fund. Third, I like the commitment expected from the workers that may require a long-term buy-in—I think that low-cost buy-ins have a tendency to devalue the membership or ownership aspect of the experience.

I’m a bit stunned at the amount of capital amassed. One of the well identified stumbling blocks for worker co-operative development in the United States has been the lack of access to capital. I realize that there are a number of groups, involved, I would like to know where  the $5 million came from and what strings are attached to it. I’m not casting aspertions, but I just have to assume that these organizations that ponied up the start-up cash expect to getting something out of the project and won’t want it to fail. A look at their website suggests that all three of the start-up co-operatives have the same group of customers (Cleveland Clinic, University Hospitals, Case Western Reserve, City of Cleveland, and Housing Network). This project is a great example of what can happen when different organizations working around economic justice, worker rights and sustainable communities break down the “silos”. I do hope that other communities learn from the Cleveland model especially Milwaukee and Madison (sadly, Madison’s current Economic Director doesn’t really seem to know much about that subject other than the standard refrain that government should get out of the way).

This does turn the traditional model on its head in that this was a top-down organizing effort. This likely helped with fund-raising as established rain-makers were able to tap into professional relationships where a gaggle of workers would likely be turned away with a shrug. I’m not so sure how I feel about that. I’m happy to see the effort up and running, but I wonder how much of the paternalism associated with a  top-down organizing effort will interfere with the transition to a true worker democracy in which the workers may make decisions that the founders fundamentally disagree with. I can see a dynamic where there could be a difficult (even fatal) transition in generational succession. This may be exacerbated by the management being chosen from a management class that may not really have anything in common with the workers. Will future managers be developed within the organization or sought within the existing worker co-operative movement?

Another issue with the top-down model involves labor relations during the start-up phase. Who will decide who gets off of probation and becomes a member before there are members? Will there be an appeal process? How will disputes get resolved without ownership or a labor union? They are creating good paying jobs (although the article didn’t really mention expected pay and benefits) in a very depressed area. I imagine a lot of people are looking forward to the work and see the ownership part as an abstraction. Working is a worker co-operative is not for everybody (at least not without a lot of therapy and training). We don’t refer to the Yellow Family at Union Cab for nothing, the relationships are very personal and very difficult to walk away from when times get tough. The intimacy of the work relationships due to ownership can make the disputes powerful and difficult to manage. Not everybody is ready for that or can deal with it.

This brings up my other concern: how will these co-operatives interact with the co-operative movement? A similar co-operative is Co-operative Home Care Associates of New York that generally doesn’t interact with the larger movement despite being the largest worker co-operative in the country. Will the Cleveland Model co-operatives join the US Federation of Worker Co-operatives? Will they subscribe to the CICOPA World Declaration of Worker Co-operatives? Will they subscribe to the Statement on Co-operative Identity?

I raise the last question because it seems that there is a trend to see co-operatives and worker co-operatives as an extension of the not-for-profit model of community development. We’re not. The growth of social workers creating co-ops is, I think, a danger for US co-operatives as they become more identified with a movement that tends to enable the worst aspects of capitalism. The rise of Policy Governance Model among consumer co-operatives is, in my opinion, a travesty that has allowed small cabals of managers and directors to create fiefdoms and barriers to expressing the user principles as well as the values of co-operatives. I would hate to see that cancer emerge into the worker co-operative world.

Finally, I have a small bone to pick. The authors make this comment, “These are not your traditional small-scale co-ops.” <COUGH, COUGH!> Union Cab with 230 members, Rainbow Grocery approaching 250 members, CHCA with over 1,000 members have been “traditional “ co-operatives for over 25 years. Granted the common stereotype is 5-10 member organizations, but the Cheeseboard and Arizmendi co-operatives all have over 30 members. The Cleveland co-ops are only looking at around 50 jobs per co-operative (according to The Economist). What makes these co-ops Mondragonish is the funding and mutual support mechanism, not the size of the organization.

I think that the Cleveland Model is an exciting development in the worker co-operative movement. However, it is one aspect. Our movement has been active for decades if not centuries. I am glad to see journals such as The Nation finally discover the co-operative model, although they probably could have covered the Democracy at Work Conferences (2006 in New York City and 2008 in New Orleans, and the 2010 conference in San Francisco). Perhaps they could ask their colleagues over as Dollars and Sense for tips on covering worker co-operatives.

To me, the best thing about the Cleveland Model is that it promises to open up some serious capital for worker co-operative development. It will still need to be determined how the strings attached to that capital work. It will also need to be seen if a top-down organizing model works to create a truly democratic work place and governance model or becomes another version of ESOP. Finally, after all the news of 2009, it is nice to be in a movement that isn’t entirely invisible any more.

We can, however, definitely agree that CLEVELAND ROCKS!

February 15, 2010

#23 Co-operation Among Co-operatives

Filed under: Identity Statement Series — Tags: , , — John McNamara @ 8:57 am

I usually make the snarky comment that the only time that I hear about this principle is when some slacker co-op wants a discount or donation. . . that is horribly unfair, of course. Also, we should discount each other—we need to do what we can to keep the money inside the co-operative community!

This principle, however, brings the value of solidarity, caring for others and social responsibility into the principles. Co-operation provides the basic form of human survival. The Folks at Sesame Street get it right: Co-operation Makes It Happen!

The Statement on Co-operative Identity uses the following definition: “Co-operatives serve their members most effectively and strengthen the co-operative movement by working together through local, national, regional and international structures.”

This, of course, means that those of us in the North America should all join either the National Co-operative Business Association or the Canadian Co-operative Association as well as our sector. In the US, that would be the US Federation of Worker Co-operatives and in Canada, the Canadian Federation of Worker Co-operatives. We shouldn’t just join, but should actively engage these organizations. We also should put aside some biases.

One of the moments in my life that proved (to me) that I would never be a tele-marketer was when I fulfilled my duty as a USFWC director by calling members and checking in. This one high-tech co-operative contact told me that he wasn’t going to renew because he attended the New York Conference and thought that the workshop that he attended was allowed to be taken over by Industrial Workers of the World (IWW) ideologues. It didn’t matter to him that this was a third party organization or that other attendees should have the right to express their views. He wanted a workshop that talked about business, not this political crap.

Well, I couldn’t help but notice that he seemed to be speaking for the entire co-op even though I doubt that he actually presented a fair view of the federation to the other six members. I wonder if he even mentioned it. My interaction made me think that it was a “co-op” but that this guy was really the boss—which then makes sense that he didn’t want to hear from the IWW lest his fellow members catch on that co-ops should be a democracy.

In any event, the point of building the movement isn’t to bring immediate gain to one’s co-operative. It is to build the co-operative image as a valuable community asset. Arizmendiaretta noted, “It is a mistake to each a co-operative a closed world. We must consider inter-cooperative solidarity the only resource to be used to forestall other problems of growth and maturity: we must consider a growing development adapted to circumstance.” The reality is that we (worker co-operatives) have a lot to teach each other. Mondragon speaks of the concept of Inter-cooperation. They define this principle as a specific application of solidarity and a requirement for business efficiency. While it is great to be able to do business with each other, it is even better to support each other by trading concepts, trainings, and skills.

When I was younger (pushing 30) and president of Union Cab. I remember proclaiming that worker co-operatives in the US co-operative world and a blue-collar cab co-op was unique among worker co-ops. The upshot is that there was nothing to learn from the other co-ops. We were alone in the world and had to find our won way. I was young (and arrogant)—and there weren’t a lot of other worker co-ops known to us in the early 90’s. I hear our young leaders say that today and make a mental note to take them aside and have a talk. I also hear people lament our membership dues to NCBA and USFWC and The Co-operative Network wondering what our co-op gets out of our membership.

Well, we (individually and through our co-operatives) help build the movement. We help government officials understand what a co-operative is. We help each other learn how to co-operate better. We help other co-op sectors understand the importance of treating their workers well. We get back what we put into these organizations, but even if all we do is write a check, we help build the movement. This doesn’t have to mean just giving each other discounts. We should share our policy manuals, help each other find new ways of working together. In the US, we need to find a way to pool resources to provide some of the things that our individual co-ops cannot achieve on their own: affordable health care, pensions, retirement plans, etc.

I think that this principle needs to be expanded. Yes, the apex organizations can do a lot. However, we need to create local networks, marketing campaigns and even our own banking system. Even the casual observer of Mondragon recognizes that the Caja Popular had a significant (if not vital) role to play in the rise of Mondragon. The Cooperative Warehouse Society and the Co-operative Bank clearly played the same role in making The Co-operative* the largest consumer co-operative society in the world.

We all need each other to make the co-operative model succeed. I don’t want to limit this to just the co-ops either but to the other legs of the stool as it were. We need the academics who study and propose new concepts in management, who help educate as developers, or teachers, or professors. We need the politicians who help protect the co-operative model.

Co-operation among co-operatives starts with the individual but quickly moves on to the entire world. Our co-operatives need to educate the membership and help them to realize that they, but joining their co-operative, have joined an international movement of 800 million people. We aren’t in this alone, but together. If we can’t see the commonality between our worker co-operatives and the consumer co-ops or large Agriculture co-ops such as Land o’ Lakes, then we aren’t really seeing the co-op movement in its entirety.

When we take the time to understand the dynamics of a water co-operative in rural India, we make our individual co-operatives stronger. When we support the efforts of defending the co-operative movement in Bolivia and Argentina, we make the co-ops in the United States and Canada stronger. This isn’t a zero sum game where we take resources from our co-ops to give to other co-ops. Social capital, like fiscal capital, gains velocity as it travels. Both forms of capital, in the famous quip, are like manure, they only create something worthwhile if they get spread around.

*Normally, I hate it when organizations use a definite article in front of their name. I refuse to call Ohio State University, “The Ohio State University” and not because I’m a Badger through and through. However, if any organization deserves to use the definite article it is The Co-operative.

Next Week: #24 Concern for Community

October 17, 2006

Sometimes It Doesn’t Always Work

Filed under: Management — Tags: , , — John McNamara @ 6:49 pm

During 2006, The US Worker Cooperative movement suffered a couple of losses! Interestingly, both were subjects of a 2003 documentary on US Worker Co-ops called “Beyond the Bottom Line: American Worker Cooperatives” by Headlamp Pictures. It is always disappointing to see co-ops fail, however, such failures are rarities. Paul Hazen of the National Cooperative Business Association noted in his introductory comments to the USFWC that the average capitalist business last about 5 years while the average cooperative business lasts 60 years. Each co-op has its own unique structure and culture. In the worker co-operative world, each co-op tends to operate in a different industry as well. Co-ops, despite their difference in control, must still exist within the industry and cannot get too far away from it. Instead of seeing these two changes as failures, each must be seen in its own situation. Melissa Hoover, staff member of the USFWC detailed the demise of Good Vibrations in the Fall, 2006 issue of NO BOSS . She reports that Good Vibrations released an official statement stating “to stay profitable in an increasingly crowded niche market, the company need to reach more customers.” One need in a competitive field (and for any business) is access to capital. Unfortunately, even pro-cooperative financial institutions were hesitant to risk capital on a sex toys, books and DVDs. As Good Vibrations moves forward to the world of ESOP, they vow to keep many of the values of the cooperative world which they had long ago dubbed “Good Vibration Values.” It appears that a major change in the culture of Good Vibrations was a change in management. It seems clear that the membership came to see little if any connection between cooperative values and those espoused by their company. Management became staffed with people who did not have the same history or knowledge of the cooperative movement. In a co-op with a strong hierarchy, the cooperative process became the scapegoat for slow progress. To be fair, the move to switch corporate structure was met with no opposition. In the end, the workers saw the coop as the problem and voted to end. Burley had a different situation. They ended 28 years of worker ownership. They have lost money the last three years with a 1.5 million dollar loss in 2005. While most famous for the blue and yellow bike trailers, Burley also had a line of recumbent, tandems and road bikes. Despite the mass popularity of the trailers, the bikes were for the higher end of the scale. In the documentary, they argue for keep production in house instead of following every other bike manufacterer by going overseas. They cited the need to keep their jobs in house and the quality that only their personal attention can create. True enough, but the forces of globalization were against them. I can only speculate for the cause of their demise. They never promoted themselves as a cooperative (at least as far as I can tell). They didn’t produce a mass appeal (affordable) road bike or seek the popular mountain bike or hybrid markets. They might have, but my guess is that they did not market their bikes through cooperative bike stores. I have know idea how good their racing bikes were, but I know that I never heard about them during the Tour de France or among the local bikies. It seems to me that to market a racing bike, one needs a racing team to win with them (i.e. Trek). Maybe the cheap labor and materials of the Asian Tigers would have brought them down anyway, but they clearly sought the wrong market. In the end, the economy of their industry caught up with them. 39 of the 97 members lost their jobs. The new owner promises to keep production in Eugene, Oregon, but it will likely mean wage and benefit cuts. On the plus side, after the books are balanced, the former members will divide the roughly $2 million left in retained dividends and property sales. My co-op went through a similar struggle in 2000. Union was a payroll away from failing for several months. A member of Union Cab’s Board, at this low point in the co-op’s history, commented that we can always overcome our external struggles, but it is our ability to handle our internal struggles that is the true risk. When members become disillusioned and quit caring about the cooperative, or when they fail to make the decisions necessary to survive in their industry, they create more peril for their cooperative than either the lack of capital or competition could ever do.

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