The economic crisis has provoked a number of "non-capitalist" schemes to ameliorate the reductions in workers' living standards. Co-operatives and "peoples banks" [credit unions] are being hailed as alternatives to capitalist businesses. These attempts, however, do not significantly challenge the status quo. Creating a "non-capitalist" sector is like reinventing the wheel. We have had the experience of the 19th century thrift movement of savings banks and building societies and the local Co-op yet some still have not learn the lessons of the past.
Some advocate that workers should create a "non-capitalist" economic sector that could compete with the big capitalist enterprises and gradually overturn the existing order. If workers co-ops function efficiently under self-management, surely all other industries could be run in this manner goes the argument. Theorists of the co-operative movement see it as a movement that will eventually outcompete and replace ordinary capitalist businesses, leading to the coming of “the Co-operative Commonwealth” (which is often used as an alternative name for socialism). They would constitute, as it were, little oases in the desert of capitalism. The movement would grown until finally the workers would have achieved their emancipation.
The creation of cooperatives may very well offer an example of self-management but they simply cannot compete with the economic might of modern capitalism. We cannot self-manage capitalism in our own interests and the only way we can really live without exploitation is by abolishing capitalism. The state can be counted on to represent and protect the interests of the privileged minority. A "non-capitalist" sector just do not have the same resources at its disposal and therefore cannot beat the capitalist sector at its own game. In any endeavour to challenge their capitalist rivals, co-operatives would require to hire wage labour, resulting in exploitation. History is littered with the experience of failed co-operatives or corrupted co-operatives. Either the cooperatives "sell-out" or they are "put-out" by market-forces. We know what happened. This was because they had to compete with ordinary capitalist businesses on the same terms as them and so were subject to the same competitive pressures, to keep costs down and to to maximise the difference between sales revenue and costs (called “profits” in ordinary businesses, but “surplus” by the co-op). The co-operative movement was outcompeted. Cooperatives in a capitalist economy are still capitalist enterprises. Co-ops facing competition have one option other than cutting wages which is to go for the niche market: make the co-op part of their brand and market themselves to people for whom that would be a selling point, aim for "ethical consumer" market.
As with our position on reforms, we do not oppose reforms per se if they are to the workers' advantage, but we do not support reformism, a political policy of proposing palliatives as half-way measures towards socialism and similarly we do not view setting up co-ops as a revolutionary strategy or one which advances the interests of the working class as a whole. It isn't something to be promoted as anything more than a mere coping mechanism to survive a bit better under capitalism. The Socialist Party have nothing against working in a 'workers' cooperative if it means better conditions at work under capitalism and not being treated like a piece of trash every single day. We'd all rather work for a boss who at least treats us like human beings. But we emphasise that co-operatives can only ever involve a minority of workers, and the more they are integrated into the capitalist economy and its profit- seeking, the more their members will have to discipline and pressurise themselves in the way the old bosses did - what is known as "self-managed exploitation". The fact is that there is no way out for workers within the capitalist system. At most, co-operatives can only make our situation a little less unbearable.
