by
Sasha Lilley
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[...] You're creating a global capitalism within which the American state and American capital have structural power.
The structural power comes from the fact that that the U.S. is still the dominant country in terms of technology. It's increasingly playing a crucial role in terms of what I raised before--business services, accounting, legal, consulting, engineering, and of course finance. There's more concentration of American power in finance than there is in other sectors. So it's very important not to see imperialism as being only about territorial intervention. And it's very important to understand that this kind of empire grows through actually spreading production, in a sense sharing production globally in a particular way.
Difficulties quickly emerge in proposals to introduce worker self-management within capitalism, particularly when it comes to ownership. Albert and Hahnel were always careful to insist workers did not own their particular workplace, even if they controlled it — the workplace belonged to society as a whole.
They argued that workers should “direct” their workplaces because they are the ones “most affected” by what happens there, but in order for socialist democracy to work, everyone affected by workplace decisions — other workers as well as consumers and the community — must have a say in how to spend the surpluses generated by production.
However, thorny questions about ownership — and the mediation between means and ends more broadly — arise when worker control is implemented within capitalism, a system in which the institutionalization of property requires that ownership legally and substantively reside somewhere.
If state ownership is rejected as a proxy for the commons and if ownership in worker-controlled enterprises is in the hands of the workers, then these groups of workers essentially become their own capitalists. They have ownership rights, mobilize their own finances, and control and reinvest “their” surplus for their own advantage.
to think about in the context of silicon valley in particular
Without an alternative institutional mechanism for coordinating productive activities, competitive markets — which Hahnel described as “the cancer of socialism” — transform differences in assets, skills, locational advantages, and product valuation into stark inequalities between workers and communities.
The Meidner Plan, designed by the LO (Sweden’s labor central) in the 1970s, proposed an annual levy on profits that would then be converted into shares and placed in a central fund controlled by unions (which at the time represented over 80 percent of workers).
The funds could be democratically allocated to regional and sectoral development and, over time, majority ownership of the nation’s productive assets would shift from private owners to the Swedish working class.
But the issue of time turned out to be a major problem: throughout the transition, the Swedish economy would remain dependent on the same private corporations the plan sought to expropriate.
Warning that they would instinctively hold back long-term investment if their property rights were threatened, and arguing that efficiency, stability, and even living standards would suffer irreparable damage if the transfer of ownership took place, corporations mobilized aggressively against the Meidner Plan.
Countering business’s threat demanded a broad, aggressive response, including blocking corporations from running down their assets or leaving the country. But such a dramatic rupture with capitalism was not on the agenda, and the LO’s proposal — elegant in theory but contradictory economically and politically — went down in defeat and was never revived.
good summary of what went wrong with the Meidner plan. there's another jacobin article that goes deeper into what happened with the leader of the socdem party, who essentially capitulated t capital
The tragedy of Republic Windows highlights the limits of sporadic, more or less arbitrary takeovers, especially when — as is the norm — the factory in question has been spurned by capital but remains subject to the same competitive relations between enterprises.
Though admirable as defensive measures, factory takeovers are not inherently threatening to the status quo, nor do they necessarily lead to the deeper understandings, commitments, and strategic capacities that could provide the basis for a future challenge to capitalism.
Another popular micro-alternative is the co-op, a form of business based on the egalitarian principle of one member, one vote. There’s no disputing the achievements of co-ops, but it’s important not to exaggerate their significance.
While Marx famously praised worker cooperatives as “represent[ing] within the old form the first sprouts of the new,” he also insisted that “they naturally reproduce, and must reproduce, everywhere in their actual organization all the shortcomings of the prevailing system.”
Formal equality in co-ops doesn’t necessarily mean that everyone participates equally; as in electoral democracy, bureaucracies and elites (and indifference) readily thwart the promise of equal voting rights. Additionally, over 90 percent of co-ops are consumer co-ops, meaning the main owners aren’t the people who work there.
Even in worker–owned cooperatives, membership and employment don’t always coincide: at Cooperative Home Care Associates, America’s largest worker-owned cooperative, only half the workers are co-op members. This isn’t unusual: many co-ops are co-ops in name only, and some large ones even openly encourage special stock ownership that weakens membership control.
Co-ops are also not nearly as autonomous from capitalism’s dictates as advocates imply. Credit unions — the most prevalent kind of co-op — have had to enter financial markets to raise the funds to service their base, and are therefore effectively integrated with Wall Street. Some were even implicated in the 2008 financial crisis.
[...] Under ESOPs, workers are partially compensated through company shares that are held in trust until they retire or leave. A notable proponent, Alperovitz concedes that ESOPs are far from perfect but still cites them as evidence of “evolutionary reconstruction” in the advance of democracy.
Yet ESOPs were introduced to undermine workplace democracy and worker power, not enhance it. Corporations like Proctor and Gamble, IBM, Coca-Cola, and UPS chose employee stock-ownership plans for the tax breaks and to help keep unions out (or at least limit their mobilization against wage or benefit concessions by offering a partial “offset”).
As a Federal Reserve paper examining the relationship between union bargaining and ESOPs concluded, “ESOPs create incentives for unions to become weaker bargainers.” From the perspective of challenging capitalism, ESOPs aren’t prefigurative, but integrative. The stock holdings offered to workers involve no redistribution of power, and what workers generally “share” in terms of corporate revenue is merely a slice of what they recently gave up.
For all its purportedly radical goals, the movement for worker control within capitalism offers up curiously apolitical strategies to get there. They prioritize challenging property relations, but pay scant attention to the need to enter and transform the state, and seem to have little appreciation for how inter-firm competition helps reproduce capitalism’s social relations and priorities.
Linked to these shortcomings is the short shrift given to political agency and the kinds of class political capacities — as opposed to economic capacities — that “getting there” demands. This relative disinterest in power and agency is the movement’s most fundamental weakness.
How would workers actually take over workplaces not abandoned by capital? Is it right to expect workers to even want to do so given the uncertainties and lack of institutional support? What preparations are being made for the inevitable counter-attack from the state if this movement actually begins to threaten the economy’s dominant corporations and limit private capital accumulation? And beyond any threats from the state, how will these fragments of a new social order be coordinated and sheltered from the destructive pressures of domestic and international competition?
Organizing outside the state is undoubtedly important. Yet at some point, anticapitalist movements can’t avoid taking the struggle into the state. Historically, when workers have gone to the brink in terms of militancy but refused or lacked the strength to engage with the state, their rebellions faded or were brutally crushed. To ignore or downplay the need to build a movement that can take on state power is to lose by default.
A systematic consideration of the state isn’t just an issue for “later,” after the movement has become an actual threat. Rather, it is an immediate challenge — even when viewed in strictly economic terms.
Though worker-owned enterprises and co-ops have proven they can survive in particular niches or in economic spaces largely abandoned by corporations, confronting capitalism’s major banks and corporations is a completely different matter.
It strains credulity to expect worker-led enterprises to march out of capitalism’s shadows and replace corporate capital without the kind of support that can only come from states. The problem is not only that WSDEs and co-ops are disadvantaged from the beginning in terms of the workplaces and sub-sectors they have inherited, nor that they confront such a massive gap in financial, managerial, and technical resources as well as established connections to inputs and markets.
Above all, it is that competition trumps everything. Despite isolated exceptions, competing on capital’s terms while trying to hang on to values that don’t enhance competitiveness means repeatedly facing a choice between jettisoning those values and accepting defeat in competitive terms.
One common response to this dilemma is lobbying for special provisions for WSDEs and co-ops to partially correct the competitive disadvantage. These range from the easily agreed-upon policy of more “training,” to favorable start-up and financial subsidies and substantive technical and research support. Yet while survival may make such responses necessary, they also further legitimate the destructive impact of the competitive game.
The day-to-day realities of competition tend to fragment solidarities, pushing worker collectives to look out for themselves — making winners feel little need to foster broader solidarities and losers feel cynical about worker control.
The vortex of competitive pressures also spins its way into the inner workings of the collectives, giving greater weight to skills that markets deem more valuable and reproducing in-plant hierarchies that boost profitability.
The divisions can also be self-inflicted, as when Wolff insists on categorizing workers along the axis of productivity, determined on the basis of whether they make a direct contribution to the creation of a surplus. Whatever purpose this might serve in analyzing capitalism (dubious at best), the distinction is especially counterproductive in building class-based solidarity.
Giving some workers a higher status than others reinforces the lower status often accorded to laborers like office workers and cleaners (generally more precarious workers, often women and immigrants). The verbal gymnastics of describing so-called non-productive workers as nevertheless important or labeling them “enablers” does little to equalize their status. (Similarly, telling lower-paid fast-food workers they are less exploited than autoworkers because they don’t produce as much surplus value does little to build bonds of solidarity across the working class.)
There are reasons to hope worker-controlled enterprises flourish economically. But their success does not, by itself, produce a working class with the capacities to win the coming political battles.
really good critique!!
In grappling with the dilemma of competitive success versus class formation, one point must be made: trying to enact policies that “level the playing field” is the wrong approach. What’s needed is to change the rules of the game, so that the measure of success is not a “competitiveness” that undermines solidaristic and egalitarian values.
Changing the rules of the game means constraining the disciplining power of competition — limiting rather than extending freer trade, and constricting the ability of capital to remove productive enterprises from the communities that enriched them. This also implies giving greater weight to inward-oriented development and introducing a significant degree of economic planning.
Moving in this direction, rather than working within the existing rules of capitalism, requires taking the struggle to the state — not just against the state, but inside the state and with the goal of transforming the state.
This brings us back to the question of agency. If the key to achieving a participatory economy lies in the capacity to change the rules of the game and transform the state, then the evaluation of WSDEs and co-ops can’t rest on whether this or that enterprise is economically successful but whether they contribute to building a working class with the vision, confidence, class sensibility, smarts, and institutional strength to democratize the economy.
this piece is SO GOOD
Re-politicizing co-ops would mean rejoining the socialist movement: becoming active again in socialist-oriented campaigns, integrating socialist education into their contacts with members and the community, extending their facilities to serve as cultural and political spaces (coffee shops, bookstores, pubs, places for public forums).
Especially intriguing is the suggestion, which has roots in some past practices, that co-ops set aside a portion of sales to fund union, community, and socialist organizing. Buying co-op would then amount to more than just the expression of a consumer preference. It would signal a commitment to a larger political project.
In the case of worker-owned enterprises, politicization represents a more radical challenge. As emphasized above, a strategy based on taking over plants abandoned by capital while accepting the competitive straitjacket of capitalist markets may make a certain practical sense. But it simply cannot be a base for social transformation. Politicizing worker self-management demands a focus on the context within which they operate.
To accomplish this politicization, WSDEs must be integrated into larger complexes — whether organized on a regional or sectoral basis — that directly meet social needs, and they need to be at least partially sheltered, through a significant degree of planning, from the destructive pressures of competition. The scale required for such planning can only happen at the level of the state.