In E.P. Thompson’s phrase, workers have “warrened capitalism from end to end” since the industrial revolution with co-operatives and self-help societies. It is not our intention to undermine any initiatives by those who, like ourselves, must often out of necessity search for a way to survive in the least painful way possible. We have no objection to the fact that some workers try to live the way they want and try to make the best of the circumstances in which they find themselves. In certain and appropriate situations, in many (but not all ) cases, workers might be temporarily better off by forming some kind of co-operative where that is feasible. Many compromises have to be accepted and there is no need in condemning them if that was their choice in these circumstances.
But what we want to point out is that these escapes are not really escapes at all, but ways of existing within capitalism. They can only be little more than adaptations to the current system and should not seek to present themselves as a form of socialism, or, worse still, as a means to transform society. The idea that it is possible to escape from our wage-slave condition and transform ourselves into people who are free from capitalist relations once we have set up our co-operative business and are working for ourselves is false. The fact that some are trying to do what they think is necessary and what they think is advisable, does not stop us arguing that the class struggle can be conducted in no other way than one that puts an end to capitalism.
Some defenders of co-operatives continue to assume that getting rid of capitalism and capitalist social relationships is primarily a matter of gradually changing peoples 'values' and that this can be achieved by the growth of practical examples such as are embodied in the likes of radical workers and consumer co-operatives. This idealist approach both overestimates the strengths of the co-operative movement and underestimates the power of the capitalist economy (in which co-operatives operate.) It ignores workers resistance ie class war against capitalism in creating the material conditions that might achieve a mass change in social consciousness and peoples values. When capital makes demands of bosses via market forces, they have to impose them on workers, and workers can resist. Workers’ needs are in direct contradiction to the needs of capital accumulation. However, if we become our own boss, the needs of capital appear as the natural imperative of market forces. Class struggle – and with it the potential for revolutionary change – is short-circuited. Ends are made of means, some means get us closer to what we want, others make it more remote and finally destroy its possibility.
It may seem rather obvious: we cannot live without capitalism as long as we have not put an end to it. Co-op members are not capitalists in the sense that they are profit-seekers, but nevertheless they are still tightly bound within the relations of private property. There is nothing fundamentally radical or progressive about co-operatives. They are not inherently antagonistic toward capital, and do not intend to be so, but in fact all are strategies for the immediate or long term alleviation of some of the problems that arise throughout our lives. Socialists should stress the need for workers struggles to extend and deepen rather than become inward looking to backward solutions like co-operatives. which in most cases stand little chance of survival in the crisis conditions of capitalism.
Over centuries idealists dreamed of the possibility of living on communist islands amidst the ocean of society. Whatever may be their value in ameliorating the present conditions of the working class — cooperatives or communes will not accomplish the social revolution. Many people may speak of alternative economics on the premise that the basis of capitalism is money. However, exchange is the basis upon which the market stands and its foundation is not the creation of a relation between persons, but between persons and things: what do you possess?; what do you have to offer? What do you want instead of what do you need? To set up any business and expect it to profitable requires it to be competitive. This applies whether you set up your business by yourself as self-employed or if you create a cooperative. If a business is not competitive, it dies. Co-operatives sometimes emerge when capitalism falters. The experience of the factory occupations in the Argentinan economic melt-down (and elsewhere) shows us that these factories were able to become profitable for the market again by becoming competitive at the price of self-exploitation and operating within the very same business practices that prevailed before the factories were occupied. A firm possesses a logic of its own - expand or die. This is the reality of running a business, and it exists independently of how that business is run (as a one-man owner, a joint stock PLC or a co-operative). An enterprise under the control of the workers actually means the workers are under the control of the enterprise. The need to take decisions quickly, to search for new clients, to decide about strategic investments, and, in short, to fully engage with other enterprises in the sphere of circulation, has immediate consequences on both the decision-making process and the organisation of work. Self-management meant self-exploitation. With the disappearance of supervisors, the personification of capitalist authority also disappears. Yet, it is the authority of market competition the one that now directly, without any intermediaries, imposes on workers the respect of delivery times, product quality, and competitive prices. Thus the market itself may be seen as the fundamental regulator of workers’ discipline, and this in the forms of both collective sanctions, like with rules books and peer reviewed quality standards, and individual rewards.
Co-ops are companies whose ownership is shared equally among its members. Nonetheless, co-ops are usually hierarchical organisations. Democratic perhaps, but hierarchical nonetheless. Managers may be selected through some democratic or consultative process involving members but, once selected, they delegate and command their ‘underlings’ in a manner not at all dissimilar to a standard corporation. Members of worker co-operatives necessarily live schizophrenic lives. On one hand, they function as owners of small businesses and contend with all the insidious forces of capitalism – the anti-ethic of profits before people. At the same time they are members of an aspiring egalitarian corporate entity.
As good as employers' intentions may be at the start of their respective enterprises, they're eventually forced to seek greater profits while at the same time suppressing wages as much as possible, which is more often than not the only way they can survive in a field full of competitors compelled to do the same. In many cases, employers as individuals are found to be good people and may want to provide decent wages and benefits for their employees, etc. Nevertheless, the logic of the system forces the hand of employers to exploit labour as much as they can; and at the same time, labour is coerced into the position of working for a wage and fighting for gains that employers quickly counter in an endless battle punctuated by regular economic crises.
And it's not simply that these types of businesses are inherently less efficient, competitive, profitable, etc., but that the logic of the system is overtly hostile to their fundamentally pro-worker design. Nevertheless, they can certainly be successful, especially in more supportive economic environments (e.g., the MONDRAGON ).
Co-operatives, barter networks, time banks or credit unions, so long as they are confined to a few groups they can function adequately. But to suggest that capitalism will provide capital for the absorption of the unemployed in this way, when capitalism needs an army of unemployed, or that co-operative economy must remain on a primitive basis and separate from the economics of society as a whole is just nonsense. Such schemes may make things a bit easy for some poor devils thrown on the scrap heap of capitalism, but the problem of deviling with unemployment is inseparable from the socialist task of abolishing capitalism altogether and founding the economy of socialism. Endeavours to strive to establish its separation, self-sufficiency and independence from the private property system continues a tradition of Utopian socialism and petty-bourgeois escapism that spans working class history. It calls to mind the experiments of Owen and his followers and the cooperative ventures of the trade unions. Like them, they aim to solve the economic and social problems – abject poverty, degradation and starvation resulting from unemployment – born of the profit system.
Marx underlined the limits that workers’ cooperatives within the capitalist system since these “naturally reproduce, and must reproduce everywhere in their actual organisation all the shortcomings of the prevailing system” Luxemburg insisted in Reform or Revolution htmcooperatives were “totally incapable of transforming the capitalist mode of production” Bakunin wrote:
“The various forms of cooperation are incontestably one of the most equitable and rational ways of organizing the future system of production. But before it can realize its aim of emancipating the laboring masses so that they will receive the full product of their labor, the land and all forms of capital must he converted into collective property. As long as this is not accomplished, the cooperatives will be overwhelmed by the all-powerful competition of monopoly capital and vast landed property; ... and even in the unlikely event that a small group of cooperatives should somehow surmount the competition, their success would only beget a new class of prosperous cooperators in the midst of a poverty-stricken mass of proletarians...”
Creating or supporting co-operatives is not enough in itself to overcome capitalism as they adjust in order to survive within capitalism. Those involved in the co-operative movement must define their limits, so as to contain, if not prevent, disappointments dashed expectations and false hopes. Many start-up worker cooperatives are founded on “venture capital” of its members’ sweat. Worker co-operatives are not free from the pressures of competition with “conventional” capital, in fact, contra Proudhon and his followers, worker co-operatives are even more vulnerable to the vicissitudes of competition, often due to their lack of access to resources with which to build competitive advantages to capitalist enterprises. Co-operatives sponsored by the state, as was the case in the former Yugoslavia and Algeria, while offering the possibility of startup capital and relative protection from the market, engender dependency on the state, and subject the co-operative’s autonomy to the whims of state managers.
The Socialist Party has a plan of action that is in harmony with the philosophy of socialism. As socialists we want people to control all aspects of their lives, of which the production of goods is but a small part. As long as the profit motive rules, workers will be exploited and have little say or control in what they produce. Co-operatives will still be wage slavery. Co-operatives (and nationalisation) cannot be seen as any kind of stepping stone or useful reform on the way to the revolutionary overthrow of capitalism and the state in today's modern globalised world, whether promoted as being achieved through reformist agitation or 'direct action'. They don't work.
Sources
1. Self-management of misery or the miseries of self-management - Terra Cremada
2. Labour process and decision-making in factories under
workers’ self-management: empirical evidence from
Argentina
3. And various contributors to various threads on Libcom
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