6 ms·

Or worker co-ops.

• valuearb 9y ago
  Problem with worker co-ops is access to capital. In a world where dividends and buybacks were banned, where would they get capital? Not from investors, because few sole proprietors would be wealthy enough to invest. Not from banks, because they would be hugely capital starved without investors to fund them. I'd like to imagine Ford Motor company could have been a worker co-op, but truth is it couldn't until later in life. Henry Ford raised $28,000 to start it in 1902, nominally that's around $1M today, but it's actually far more than that. Average income was around $450 a year, so he raised about 60 times the average worker's annual salary. Without wealthy investors, there was no shot at starting Ford. Once it was churning out Model Ts by the millions the workers co-op could have succeeded, but they could never get there.