[PredatorOC]

I'd be interested in hearing arguments on why collective/participatory/whatnot enterprises can't compete with capitalist enterprises. If capitalists just exploit workers, wouldn't a worker-owned enterprise have a clear advantage in the market?

[Noelnada]

I'd be interested in hearing arguments on why collective/participatory/whatnot enterprises can't compete with capitalist enterprises. If capitalists just exploit workers, wouldn't a worker-owned enterprise have a clear advantage in the market?

I know that some collectively owned enterprises competing with capitalist enterprises exist. But the reasons why some cannot is probably due to contingent elements. I'd also be interest to hear more about the subject actually

[SpiderMonkey]

Its harder to organise collectively than hierarchically. Enterprises that manage it are quite competitive though.

Also bear in mind the rules of capital ownership are specifically designed for privately owned enterprises, not cooperatively owned ones.

[sploop!]

It depends on what you are asking.

If you mean non-hierarchical, then I guess there may be many businesses out there that run flatter than most. Some Estate Agencies run a collectivist model.

If you are talking about the shareholder model, the Nationwide Building Society in the UK is mutually owned, but follows the same sort of hierarchical structure as any other business. By the way, it is extremely successful, and is weathering the current financial crisis extremely well thanks to the business model it employs being less short-term in its attitudes. There is talk in the UK of re-mutualising the banks that were privatised last year. Also the Co-Op is a very successful business, as is the John Lewis Partnership, both of which are based on a co-operative model with a traditional hierarchical structure.

It'll be interesting to see how these companies weather the storm overall. The argument might go along the lines that the capitalist model, being so short-termist, has put a lot of companies at risk because they have needed over the past few decades to concentrate on keeping the shareholders happy instead of managing their resources for the long-term good of the business, which leaves them a bit short right now. The mutuals though have been busy looking to the future and taken a more cautious approach, which arguably is exactly what you want from a business holding your mortgage and savings.

An article in a British paper the other day pointed out that the banks that went bust in the UK recently for the most part started out as mutuals, and the reserves they had built up as part of their longer-term financial strategies were plundered during their privatisation, which has lead directly to their inability to cope with what is happening now.

[canadiancapitalist]

My apologies Red Star, you are of course right. Noam Chomsky says whenever you hear something stated in a very matter of fact manner you should question whether or not it is true. Many companies are in fact owned by their workers. Maybe not the majority, but a very large plurality. Ever heard of stock options? A lot of small businesses have a lot of principles who are also agents, and this is effective because of the reduction in agency costs present by such an arrangement. These companies are amongst the most competitive.

The real question is, why do some who believe in collective ownership of the means of production seek to deny or challenge private ownership of the means of production? Why can't we all just get along

[Red Star]

Red Star Note: CC, I've told you before about one-line posts like that. Please?

[Dr House]

the rules of capital ownership are specifically designed for privately owned enterprises, not cooperatively owned ones.

An enterprise can be privately and cooperatively owned simultaneously. That's the way the stock market operates.

[Abood]

There's a difference between a bunch of workers owning a few shares in a company and the workers of the company itself owning it.

As for the original question, I don't see why not. There's cooperative capitalism. There are many worker-owned and -managed companies that exist today.

[canadiancapitalist]

There's a difference between a bunch of workers owning a few shares in a company and the workers of the company itself owning it.

Well if worker ownership is like 1 or 2% obviously it doesn't count. Many small businesses are 100% worker owned but not equally.

[PredatorOC]

As for the original question, I don't see why not. There's cooperative capitalism. There are many worker-owned and -managed companies that exist today.

True, but they are a small minority. They simply are not as competitive as capitalist-owned companies. Why?

[FallenRaptor]

Worker's cooperatives are not as flexible as regular enterprises. They can not hire or fire workers at will, and because of this they limit incentive for investing in new technologies. There are examples of successful workers' coops though, like the Mondragon Cooperative Corporation.

[sploop!]

True, but they are a small minority. They simply are not as competitive as capitalist-owned companies.

You haven't done much more than state this. Where is the evidence? Clearly they are not as numerous as share-holder/owner model companies, but that's not the same thing, is it...

[PredatorOC]

In hindsight, my original question was slightly misguided. I'm not very familiar with how enterprises are formed in socialist/communist economies. Could someone explain how a worker's cooperative is formed and how the capital goods for it are acquired?

Worker's cooperatives are not as flexible as regular enterprises. They can not hire or fire workers at will, and because of this they limit incentive for investing in new technologies. There are examples of successful workers' coops though, like the Mondragon Cooperative Corporation.

How would this change if capitalist enterprises were abolished? Or would it change?

You haven't done much more than state this. Where is the evidence? Clearly they are not as numerous as share-holder/owner model companies, but that's not the same thing, is it...

Well, if a company has even a single employee, then it is by definition a capitalist enterprise, correct? To be a worker's cooperative, it has to be wholly owned by the workers. Otherwise the owners would just be capitalists, even if they work in the enterprise as well. And such enterprises are in very short supply, unless you count single-person enterprises where the single owner is also the single worker.

[sploop!]

Well, if a company has even a single employee, then it is by definition a capitalist enterprise, correct?

I don't think so, but if that is your definition, go for it. Arguably, for many reasons, all workers working in a collective are more likely to be considered as equally-valued employees of a legal entity. They are (in this case) employees without a 'boss', but the company still employs them.

But that isn't the point you seemed to be making. You said:

They simply are not as competitive as capitalist-owned companies.

There has been no evidence put forward to support this claim, no matter how such businesses are defined.

[PredatorOC]

I don't think so, but if that is your definition, go for it. Arguably, for many reasons, all workers working in a collective are more likely to be considered as equally-valued employees of a legal entity. They are (in this case) employees without a 'boss', but the company still employs them.

I'm confused. So property isn't collectively owned in socialism and you'd still have workers, but the workers would get an extra pat on the back?

There has been no evidence put forward to support this claim, no matter how such businesses are defined.

Well, we could see how many collectively owned enterprises or worker's cooperatives you can name. Meanwhile I'll name as many capitalist enterprises as I can and we'll see who comes up with more names.

But anyway, like I said in my earlier post, my original post was slightly misguided. Which is why I was asking for clarification on how enterprises are formed in socialism and how capital goods are acquired for it, so I can gain a better understanding if it is even right to compare socialist and capitalist enterprises.

[sploop!]

You are right. You need to sort your question out, because it is slipping all over the place...

Well, we could see how many collectively owned enterprises or worker's cooperatives you can name. Meanwhile I'll name as many capitalist enterprises as I can and we'll see who comes up with more names.

We could. but it wouldn't prove your original point, which was:

They simply are not as competitive as capitalist-owned companies.

Making lists would only prove what we already know - that collectives and mutuals are less numerous than shareholder/owner model businesses. You can see, can't you, that there might be any number of reasons for that which have nothing at all to do with competitiveness?

[FallenRaptor]

How would this change if capitalist enterprises were abolished? Or would it change?

Under socialism the unemployed can be directed to work on public projects and technology can be introduced at a more gradual pace to avoid drastic increases in structural unemployment. Unemployment might still exist under socialism(as it did in the Soviet Union), but as society becomes capable of providing "to each according to his needs", wage labor ceases to be necessary and the concept of unemployment becomes irrelevant.

[ingliz]

I would say cooperativism is an ersatz socialism, merely an improved capitalism, as it still retains the modes of production and distribution of the market economy - producer capitalism is still capitalism, group individualism, in danger of becoming "a peculiarly interested oligarchy at odds with the community".

[PredatorOC]

You need to sort your question out, because it is slipping all over the place...

How so? My original question is still quite valid.

Making lists would only prove what we already know - that collectives and mutuals are less numerous than shareholder/owner model businesses. You can see, can't you, that there might be any number of reasons for that which have nothing at all to do with competitiveness)?

Sure, but you haven't actually argued for any alternatives, now have you? All you've done is argue over definitions (even though I thought I was using the definition that socialists themselves use) and hinted that "The mutuals though have been busy looking to the future and taken a more cautious approach, which arguably is exactly what you want from a business holding your mortgage and savings."

So if mutuals and other cooperatives are more long-term enterprises, why aren't they more numerous?

Under socialism the unemployed can be directed to work on public projects and technology can be introduced at a more gradual pace to avoid drastic increases in structural unemployment. Unemployment might still exist under socialism(as it did in the Soviet Union), but as society becomes capable of providing "to each according to his needs", wage labor ceases to be necessary and the concept of unemployment becomes irrelevant.

This didn't quite address the question, or I misunderstood your original post.

But anyway, I'll sidetrack this a bit: from what I gather, socialist enterprises (I'm not sure if that is at all an appropriate word, since the terminology is a bit foreign to me) seem to need a certain social structure, correct? So how large does that societal structure need to be for socialism to work?

[FallenRaptor]

But anyway, I'll sidetrack this a bit: from what I gather, socialist enterprises (I'm not sure if that is at all an appropriate word, since the terminology is a bit foreign to me) seem to need a certain social structure, correct? So how large does that societal structure need to be for socialism to work?

There are two basic requirements for a society to have a socialist economy. One is advanced productive forces. The other is advanced socialization of labor. These two requirements have only been met within the past two centuries due to the development of capitalism.

Given the fact that capitalism is now a global economic system, socialism will also have to be international. It is possible for a single country to have socialism for at least a while if it meets the two requirements and has enough resources to be relatively self-sufficient, though.