Senter wrote:No, you're right. Though we speak of greed, the mechanics of capitalism are sufficient for producing maximum profit. Imagine 3 companies each manufacturing PVC pipe. Each company must keep their stock prices up or they suffer financial difficulties and ultimately could fail. So they must keep stock prices high by keeping earnings high. They must increase the value of the company in various ways or one of the other 2 will out-do them and put them out of business. Competition requires increasing earnings and profits. And the Supreme Court has said that the first obligation of a corporation is to maximize profits. And that also translates into bigger compensation packages for the top executives and Board members.
Since they are run by the workers, the workers watch out for the workers and profits are not held as primary. People are. Example: in 60 years of operation, Mondragon has never laid off any members due to economic declines, recession, or other financial hardships. The member-workers have always voted to take cuts in pay so as to keep everyone employed once retained earnings ran out. When Fagor, the original "subsidiary" of Mondragon, failed due to market pressures, Mondragon found alternate employment for every worker at other branches.
Profits are not primary because they are not private "owner" profits. They belong to all the members and distributed according to the Articles of Incorporation based on a worker's earnings. And the members vote on how much of the retained earnings to keep as company assets for expansion, maintenance, and future needs, and how much to put aside for workers' "rainy day fund", and how much to distribute as "bonuses".
And BTW, employee-owned businesses have higher productivity, morale, sales and wages, according to analysts. Rutgers University, which has studied the topic extensively, has found that employee ownership boosted company productivity by an average of 4 percent, while profits went up 14 percent.
Ah, so your emphasis on not being driven by profit primarily isn't so much about the dissolution of the law of value but the way in which company decisions are managed in regards to maintaining profit and other interests unlike the distant shareholder whose concern is purely their stock.
I think the positive part is that it helps to give legitimacy that workers largely run a company, a point against the specialty anyone might place on administration/managerial peeps.
The co-operative factories of the labourers themselves represent within the old form the first sprouts of the new, although they naturally reproduce, and must reproduce, everywhere in their actual organisation all the shortcomings of the prevailing system. But the antithesis between capital and labour is overcome within them, if at first only by way of making the associated labourers into their own capitalist, i.e., by enabling them to use the means of production for the employment of their own labour. They show how a new mode of production naturally grows out of an old one, when the development of the material forces of production and of the corresponding forms of social production have reached a particular stage. Without the factory system arising out of the capitalist mode of production there could have been no co-operative factories. Nor could these have developed without the credit system arising out of the same mode of production. The credit system is not only the principal basis for the gradual transformation of capitalist private enterprises into capitalist stock companies, but equally offers the means for the gradual extension of co-operative enterprises on a more or less national scale. The capitalist stock companies, as much as the co-operative factories, should be considered as transitional forms from the capitalist mode of production to the associated one, with the only distinction that the antagonism is resolved negatively in the one and positively in the other.
Though might qualify that they in themselves may not lead to socialism but may play an important precipitating part in it, more a supporting factor than a determining one.
From president of the corporation in 2001
Our clients cannot guarantee us steady workloads, so we have to have a number of people on temporary contracts. We live in a market economy. That we cannot change.
It's originator seems in the realm of evolutionary socialists in the extent that they don't really accept class struggle and seek to alleviate it in the manner that reformists aim to.
In his commencement address for the Professional School’s graduating class of 1948, Arizmendiarrieta announced that the time had come to unite the efforts of all these social actors into one institutionalized co-operative initiative. ‘It is not enough for the bosses to do good works; the workers need to participate in them also. It is not enough for the workers to dream great reforms, the bosses need to concur. It is not enough for the authorities to make great efforts and sacriﬁces, the people need to associate themselves with these authorities.’Some sort of corporative entity was needed to facilitate co-operation between two classes for a common good, and to provide a Catholic social alternative to Marxist class conﬂict.29
But there was in store a still greater victory of the political economy of labor over the political economy of property. We speak of the co-operative movement, especially the co-operative factories raised by the unassisted efforts of a few bold “hands”. The value of these great social experiments cannot be overrated. By deed instead of by argument, they have shown that production on a large scale, and in accord with the behests of modern science, may be carried on without the existence of a class of masters employing a class of hands; that to bear fruit, the means of labor need not be monopolized as a means of dominion over, and of extortion against, the laboring man himself; and that, like slave labor, like serf labor, hired labor is but a transitory and inferior form, destined to disappear before associated labor plying its toil with a willing hand, a ready mind, and a joyous heart. In England, the seeds of the co-operative system were sown by Robert Owen; the workingmen’s experiments tried on the Continent were, in fact, the practical upshot of the theories, not invented, but loudly proclaimed, in 1848.
At the same time the experience of the period from 1848 to 1864 has proved beyond doubt that, however excellent in principle and however useful in practice, co-operative labour, if kept within the narrow circle of the casual efforts of private workmen, will never be able to arrest the growth in geometrical progression of monopoly, to free the masses, nor even to perceptibly lighten the burden of their miseries. It is perhaps for this very reason that plausible noblemen, philanthropic middle-class spouters, and even keep political economists have all at once turned nauseously complimentary to the very co-operative labor system they had vainly tried to nip in the bud by deriding it as the utopia of the dreamer, or stigmatizing it as the sacrilege of the socialist. To save the industrious masses, co-operative labour ought to be developed to national dimensions, and, consequently, to be fostered by national means. Yet the lords of the land and the lords of capital will always use their political privileges for the defense and perpetuation of their economic monopolies. So far from promoting, they will continue to lay every possible impediment in the way of the emancipation of labor. Remember the sneer with which, last session, Lord Palmerston put down the advocated of the Irish Tenants’ Right Bill. The House of Commons, cried he, is a house of landed proprietors. To conquer political power has, therefore, become the great duty of the working classes. They seem to have comprehended this, for in England, Germany, Italy, and France, there have taken place simultaneous revivals, and simultaneous efforts are being made at the political organization of the workingmen’s party.
One element of success they possess — numbers; but numbers weigh in the balance only if united by combination and led by knowledge. Past experience has shown how disregard of that bond of brotherhood which ought to exist between the workmen of different countries, and incite them to stand firmly by each other in all their struggles for emancipation, will be chastised by the common discomfiture of their incoherent efforts.
An extra piece on co-ops for the heck of it.
So I think co-ops are good but it certainly has its critics.
Rosa Luxemburg has good thoughts on co-ops in her critique of Bernstein, the original evolutionary socialist.
But they perhaps only stick to the extent that one shares in the same sentiments as Bernstein as an evolutionary.
Though I still worry that people may lack the theoretical clarity in which it won't be socialism even if there are a bunch of workers co-ops, because a socialist revolution isn't of the Proudhon sense of just changing ownership of property, but as I assert earlier, addressing the 'estranged' labor that exists with capitalism.
In France Proudhon, in What is Property? (1840), had identified private property as the contradictory foundation of political economy. For Proudhon, political economy took private property for granted and tried to establish the rationality of a society based on private property. However at every stage political economy itself shows that private property undermines economic rationality by introducing inequality and monopoly. Thus private property undermines the equality of the wage bargain and, indeed, of all exchange relations. Proudhon argued that there is no moral or practical justification for this inequality and concluded that a rational and just society could only be based on the establishment of equality by the equalisation of property.
The limitations of Proudhon’s approach for Marx were that he isolated only one element of political economy for criticism, failing to recognise the connection between private property and the categories of wage-labour, exchange, value, price, money, etc. Therefore Proudhon wanted to abolish private property without abolishing the society which was based on it. The equalisation of property remains a form of property, a form, moreover, which is inconsistent with the continued existence of such phenomena as wage-labour and exchange. Thus, as Marx wrote in The Holy Family (1844), ‘Proudhon makes a critical investigation — the first resolute, pitiless, and at the same time scientific investigation — of the foundation of political economy, private property’, but it is still ‘under the influence of the premises of the science it is fighting against’. Thus ‘Proudhon’s treatise . . . is the criticism of political economy from the standpoint of political economy’ (Marx, 1956, pp. 46, 45).
In that it seems to be that for Marx (based on Simon Clarke's reading) that it's not that private property causes alienated form of labor with exchange value and so on, but that it's alienation causes private property.
It is at this point in his analysis, at the very end of the first manuscript, that Marx takes the decisive step, one which has bewildered most of those commentators who have not simply passed it by. Thus far Marx has described the forms of alienated labour characteristic of the capitalist mode of production. He now seems to be moving smoothly to an explanation of alienated labour as the consequence of private property. In alienated labour a social relation between people appears in the form of the subordination of a person to a thing. This social relation is the relation of private property, in which the capitalist appropriates the means of production as his private property, so permitting him to subordinate the labourer to his own will (Bell, 1959, pp. 933–952; Schacht, 1971, p. 107; Oakley, 1984, pp. 63, 66). Thus we find again the ‘hidden premise’ of political economy, already identified by Proudhon and by Engels.
This explanation would be entirely in accord with the orthodox interpretation of Marx’s ‘historical materialism’, for which capitalist social relations are de- fined by the private ownership of the means of production, which implies that property relations are prior to production relations (and which also has the very embarrassing implication that ‘juridical relations’ are prior to ‘economic relations’ (Plamenatz, 1954, Chap. 2; Cohen, 1970)) However this is not the step that Marx takes. He is quite clear that alienated labour is the cause and not the consequence of private property. Before labour can be appropriated in the form of property it must first take the form of alienated labour. Thus the proprietorial relation between a person and a thing expresses a more fundamental social relation between people. The legal form of private property presupposes the social relation of alienated labour:
Thus through estranged labour man . . . creates the domination of the person who does not produce over production and over the product . . . The relationship of the worker to labour creates the relation to it of the capitalist . . . Private property is thus the product, the result, the necessary consequence, of alienated labour (CW, 3, p. 279).
Marx recognised that this argument may seem paradoxical, but he was unequivocal:
True, it is as a result of the movement of private property that we have obtained the concept of alienated labour (of alienated life) in political economy. But analysis of this concept shows that though private property appears to be the reason, the cause of alienated labour, it is rather its consequence . . . Later this relationship becomes reciprocal (CW, 3, pp. 279–80).
Although Marx’s theory of alienated labour has been wilfully or unwilfully misinterpreted by almost all the commentators, it is the very foundation not only of his critique of political economy and of Hegel’s philosophy, but also of his critique of the presuppositions of liberal social thought in general. It was this insight which, Marx later acknowledged, ‘served as a guiding thread for my studies’ (Marx, 1968, p. 181). Private property is the hidden presupposition of liberal social thought because it is private property that constitutes the abstract individuality of the bourgeois subject, the individual having been isolated from society through her private appropriation of the conditions and products of her social existence.
If Marx’s critique had remained a critique on the basis of private property, as the orthodox interpretations would have it, it would have remained, like that of Proudhon, a critique on the basis of political economy and, more generally, within the limits of bourgeois social thought. But if the relation of private property between a person and a thing is only the juridical expression of a social relation between people, the abstract individual subject of bourgeois social theory is found to be only a philosophical abstraction, expressing particular social relations of production. The starting point of philosophy and of social theory has to be not the abstract individual, whose social qualities are concealed behind a property relation between the individual and a thing, but the historically developed social relations which characterise a particular form of society. Marx’s apparently innocent argument that private property is the result of alienated labour has devastating implications, for it undermines the apparently a priori character of the fundamental categories of bourgeois thought.