23 ms·

Mondragon as the new city-state

249 points by jinjin2 2y ago

intalentive 2y ago
>If the model is a good one, detractors say it can’t be replicated outside of the Basque Country, and there’s some truth to that. The author doesn't speculate why, but I'd guess it's partly due to Basque ethnic solidarity. Mondragon sounds a lot like the kind of late 1800s / early 1900s syndicalism that later evolved into Italian fascism and German National Socialism. Of course, another big "collectivist capitalism" success story is China, which is also fiercely nationalist. I don't see either of those models working in the West on a large scale any time soon.
- prmoustache 2y ago
  Now Basque country is not considered "the West"?
  - intalentive 2y ago
    >"on a large scale"
- kmeisthax 2y ago
  I've heard this story ever since I was a shit-eating Ron Paul voting right-libertarian. The whole "collectivist success requires ethnic purity" argument. I don't buy it. It is, inevitably, either an excuse to destroy functional collective institutions, an excuse to advocate for ethnic cleansing, or both.
  - intalentive 2y ago
    To elaborate on my previous comment: if you want people to be less individualistic and more community-minded, and especially if you want economic organization to be more cooperative, decentralized and bottom-up, then people are going to need to feel a deep sense of buy-in and belonging, and you don't really see that in an undifferentiated mass of atomized "consuming and producing units". But you do see it among the Amish, and the Basques, and the Boers, and in the kibbutzim, and in families generally, because kin relations are meaningful among humans and elsewhere in the animal world. And I'm not arguing that "collectivist success requires ethnic purity", just noticing a correlation. Where you see apparent altruism in economics -- including nepotism in hiring -- you tend to find kin relations. Probably the game theorists and evolutionary psychologists have it figured out.
    - harwoodjp 2y ago
      It's true that, in those groups, a shared ethnic identity enables economic cooperation. But the lack of solidarity you observe is the result of a regime of coercion. The official policy: leave your neighborhood, family, friends, and passions for 40+ hours a week to build a capitalist's business. You have to do it to survive. And the police are there to make sure revolts don't break out.
      - ertian 2y ago
        The claim that work is inherently coercive is crazy to me. In order to live, we need food, clothing, shelter, comforts. Those take labor to produce. We've abstracted labor using money, allowing for specialization, so you can perform some specialized labor to provide for all your needs. The needs aren't forced upon you. They're inherent. Labor is required to meet the needs you must meet in order to live (and live in comfort). They'd be needed even if no board of directors had ever sat in a meeting room. So who's coercing you? It's like a farmer hating his field: you're mad that companies 'make' you work to survive; a farmer might hate his field for 'making' him plant seeds to produce food. I don't get it. It seems delusional.
        harwoodjp 2y ago
        Automation makes jobs unnecessary. We should build social infrastructure that allows people to pursue their passions with basic necessities guaranteed. This has been possible for awhile now.
        chongli 2y ago
        Nonsense. You can’t feed people with machines. You need raw materials and you need land to produce those materials from. That productive land is already owned by a bunch of people who currently use it to grow food and sell at market for profit. Are you proposing we seize their land? That’s what the Soviets did. Millions died. With the weaponry we have today it could be hundreds of millions or billions. All for what? So people don’t have to work? Now suppose we do collectivize all the farms, this time miraculously without killing everyone, and we successfully set up the automation to feed everyone (despite the fact that a lot of crops still need to be picked by hand due to a lack of robot technology). We still don’t eliminate the need for work. There’s tons of other stuff to be done. Building houses, computers, trains, planes, automobiles, and new factory robots. There’s still tons of research going into all this stuff, maintenance and repair. People still need to do all this work. Who is going to pay them? Who is going to own what they produce? If I build a robot in my garage to automate harvesting the peppers I grow in my backyard, do I own it?
- mikojan 2y ago
  The importance of "leftist" fascism is overplayed. "Socialism" back then, much like "Human Rights" today, was generally associated with what is morally right. It was not an ideology of extremist groups. Fascism "evolved" from socialism same as everybody and their mother evolved from it. And because of its dominance, everybody tried to exploit it, too. So you called your organisation "National Socialist Party" and your heads of propaganda copied the rhetoric. Also, libertarian socialism was nowhere as developed as in Spanish society at that time. This is not the most surprising society to generate Mondragon.
  - deleted 2y ago
    [deleted]
- mikrl 2y ago
  >Of course, another big "collectivist capitalism" success story is China, which is also fiercely nationalist. Yugoslavia had a dynamic market socialist economy and was powerful enough to align against the USSR for decades, yet was multi ethnic. It suffered from the typical authoritarian weak succession and was ultimately destroyed by its resurgent ethnic nationalism.
- cholantesh 2y ago
  >Mondragon sounds a lot like the kind of late 1800s / early 1900s syndicalism that later evolved into Italian fascism and German National Socialism. Sure, if you dishonestly use their slogans rather than policy decisions as your barometer. What actually happened is that fascists co-opted the language of the left and deployed it in service of entirely different ends.
abeppu 2y ago
A thing that is kind of glossed over is: what is "ownership" when we talk about worker-owners at cooperatives? > The profits generated by each cooperative are put to work for the benefit of the greater whole. Each cooperative gives 14-40% of their gross profits to their division (depending on the division), and another 14% to their parent company. The rest are invested back in the cooperative (60% of net profits), distributed among their employees (30% of net profits), and donated to social organizations in their communities (10% of net profits). > Workers buy into their cooperative when they become employees, investing up to €16,000 into a personal equity account. They pay 30% of that investment upfront, with the remainder taken out of their paychecks over following 2 to 7 years. After two years with the organization, workers become “members” and start earning interest on their investment at a rate of at least 7.5% annually. If the cooperative does well, they might earn much more than that. Workers can pull this money out of their accounts when they leave the cooperative or retire. ... so it's not ownership, right? It's profit-sharing while you're an employee (the "interest" the worker gets is out of that 30% of net profits discussed previously), but you don't own shares in the company that you can then sell, like an employee who receives an RSU or receives and exercises an option. In some sense, corporate employees that get some form of equity as part of their compensation are more literally worker-owners. I think the problem with American companies that have an employee stock plan is that the employee stock pool is a small slice of the total ownership, and employees don't participate in any real democratic governance. Despite being shareholders, they get far less information about the financial health or strategic position of the company than investors with board seats. Real partial ownership doesn't lead to real power or access to information. And the aim of the company is still to serve the larger investors, not the workers.
- metabagel 2y ago
  I think that more important than ownership is the purpose of the company. Most companies have the purpose of making money. Few have a purpose which includes contributing to quality of life, unless that’s something which can be sold for a profit.
  - devman0 2y ago
    Not just making money, but making more money than they did last year, forever. Like a company can't just be cool with the fact that they serve a profitable market niche and gainfully employ people. Investors need capital gains and won't just be satisfied with getting reliable dividends! Stock buy backs ruined corporate governance...
samatman 2y ago
The difference between Mondragon, the kibbutzim, and other successful examples of collective labor, and the Soviet system, is precisely that the former are not governments, and operate in a capitalist system of property rights and free markets (in a practical rather than spherical cow sense of that term). I'm all for more cooperatives, it's a good model. Operating in a system which doesn't compel that form of organization is what keeps them honest. Mondragon is a profitable company, emphasis on profitable. The article talks a bit about how, while Mondragon is a pretty good deal for basic labor, they have trouble attracting high-demand talent like engineers, which they also need. In a free-market system, a worker's collective can solve a problem like that, by offering more perks, raising the 'level' for new engineering hires, waiving some amount of the up-front investment, or just getting by through, in effect, paying some of the salary in a nonmaterial reward of belonging to something which better meets some people's sense of ethics and fairness. That's not how it works when the company you work for is also the police and the military. It's also not how it works when every company is compelled to organize itself this way. That compulsion leads to dysfunction, corruption, cheating, and at the extreme end, gulags. So let's pass on all that. If you believe that worker cooperatives are a social good, as I do, buy stuff from them. Work for one, found one. It's working so far.
- hn_throwaway_99 2y ago
  > The difference between Mondragon, the kibbutzim, and other successful examples of collective labor, and the Soviet system, is precisely that the former are not governments... I've heard it put as "Socialism works great, as long as the socialist community gets to decide who is included."
- cies 2y ago
  The "soviet system" as you call, started (yes the revolution) with a slogan "power to the soviets". In the slogan the word "soviet" meant "worker coop". This slogan was abolished when more central planning took over, and the word soviet become more associated with the central govt/ the state.
  - samatman 2y ago
m_ke 2y ago
It's a shame there's not a YC like incubator for tech worker coops, cut out the VCs and have milestone based funding in exchange for a percentage of future profits that would be reinvested in future projects.
- cies 2y ago
  It's inherent to the way a coop works that it's not possible to follow the same path. There is no 7% equity to be given, only the repayment of a loan. The coop model does not promote taking risk and hence have many fail, yet a few grow very quick. Another problem is law. At this point it favors the common ownership forms of business. Starting a coop is hence much harder than it should be. This is what i think where the "it's a shame" make most sense. We should make w-coops easier to start and give them tax benefits as they are on the long run much more beneficial/ less detrimental to society.
  - jszymborski 2y ago
    I'm not a finance person, but my understanding is that co-ops more often raise capital with traditional loans. While I believe you are correct that co-ops are not a great fit for the growth business strategy that VCs make their bread and butter on, I believe that on many metrics co-ops tend to be more sustainable than the corporate alternatives[0]. This means they are more likely to be around tomorrow to pay off a loan. All this to say, it would be great to see more capital for co-ops in the form of traditional loans with favourable interest rates. [0] https://www.theguardian.com/social-enterprise-network/2014/mar/11/co-op-business-sustainability https://www.theguardian.com/social-enterprise-network/2014/m...
    - cies 2y ago
      > All this to say, it would be great to see more capital for co-ops in the form of traditional loans with favourable interest rates. Sure, that would be great. But what can govt do today to incentivize that? I'd say just relax (tax) law on w-coops to incentivize them compared to the less favorable forms of incorporation.
mempko 2y ago
For those astute, workers owning the means of production should sound familiar. Mondragon demonstrates that it can scale.
YossarianFrPrez 2y ago
It's interesting to read about Mondragon in more detail. I just came across the term in Kim Stanley Robinson's solar-system sci-fi epic "2312." The book (highly recommended) heavily references Mondragon; that's the name for the alliance / co-op of all of the planets and settlements that aren't Earth or Mars.
- keyle 2y ago
  Thanks for the book idea '2312', will check it out.
conaclos 2y ago
The anarchist culture of the 1800s and 1900s in Spain, especially the emergence of anarcho-syndicalist structures [0], is certainly one of the reasons for Mondagon's existence. [0] https://en.wikipedia.org/wiki/Anarcho-syndicalism https://en.wikipedia.org/wiki/Anarcho-syndicalism
- api 2y ago
  Why aren’t there more of these if they work well?
  - harwoodjp 2y ago
    Why don't workers unite to democratically manage production? The police, propaganda, wage slavery.
    - deleted 2y ago
      [deleted]
    - nyokodo 2y ago
      > Why don't workers unite to democratically manage production? Because the majority of workers are doing the minimum amount of work to get by, because ~50% of workers are below average intelligence, because those with the entrepreneurial skill and/or business management competence necessary to make this happen benefit more from the current system and have less motivation to mess with it.
      - harwoodjp 2y ago
        [flagged]
        K0balt 2y ago
        I can’t speak to op’s emotional well being, but he is spot on with his reasoning. In the rarified air that most of us here inhabit, it’s easy to forget that for every college professor there is someone for whom tying their shoes is a significant cognitive challenge. For every really smart person, there is someone who lacks the cognition to participate meaningfully in society. For every brilliant individual, there is someone whose mental capacity puts them in need of lifelong care. The bell curve is a bitch. The average person just gets by and doesn’t think all that much about anything outside of their immediate surroundings. For most, politics and such is a team sport, not an intellectual pursuit. It’s an uncomfortable fact of life, and those that have talents and gifts above the norm are by default responsible for guiding and advancing society. We ignore that burden at the peril of all.
qrush 2y ago
Just wanted to flag that there are areas in the US that co-operative enterprises do flourish and have knock-on effects. This is biased by my food co-operative experience but just to show that there is an alternative to unfettered capitalism where businesses help each other thrive. - The Minneapolis/St. Paul region has so many food co-ops that there's a co-operative warehouse dedicated to serving them (and other businesses too) https://www.cpw.coop/ https://www.cpw.coop/ - New England has a multitude of 30-40 year old food co-ops (along with startups like mine) and has its own association of food co-ops to help advocate for better state policy/governance http://nfca.coop/ http://nfca.coop/ - National Co-op Grocers is a US-wide group that helps co-ops buy food at cheaper rates and provides a ton of great branding food co-ops who are members get to use https://www.grocery.coop/ https://www.grocery.coop/ I'd love to see more tech co-operatives sprout up someday... there is an alternative to VC that keeps ownership equal, and it's been all around us this whole time!
- disqard 2y ago
  Are there any resources for learning about tech co-operatives in the USA? Do you happen to know any (specifically in tech), that you would recommend? Thanks!
  - qrush 2y ago
    I still need to finish reading it, but this was published last year on the topic: https://www.versobooks.com/products/2839-own-this https://www.versobooks.com/products/2839-own-this
- Optimal_Persona 2y ago
  I also have a background in food co-ops (member owned), I was in the bakery of one for 7 years, then served on its board. Food co-ops are really interesting orgs because food is one of the things people can control in their lives so their feelings, neuroses, fears etc. come out. When we expanded about 17 years ago we managed to drive a new Whole Foods that had sprouted across town out of business within a year. Haven't heard of that happening elsewhere. They had a terrible location which didn't help but I think it was more due to the loyalty of our customers who had buy-in (literally).
jszymborski 2y ago
If: 1 - Cooperatives excite you and 2 - You use social media you might want to look at the social.coop Mastodon instance (or cosocial.ca if you're Canadian). Not only has the community on both those sites been a breath of total fresh air for me, I am not worried about the server I'm on having decide between disappearing and selling ads, and I feel like I'm partaking in a social enterprise. Just recently social.coop had an open vote on how to donate some of our surplus to the open software we use and organizations that promote cooperation. It's been so nice to see and be apart of.
- fragmede 2y ago
  That's neat! How is it funded?
  - SamWhited 2y ago
    By the members; we all pay a tiny bit into the co-op each month. Most people pay 1 USD or GBP per month, if you use some of the other services we offer through organizational memberships in other co-ops (ie. we're a member of meet.coop for video calls, May First Co-op for Nextcloud and email and what not, etc.) then some people pay a bit more (normally no more than 3 to 5 USD or GBP).
- rglullis 2y ago
  Beware of social washing to justify higher costs. cosocial.ca charges CA$50 for its annual membership. Omg.lol charges $20/year for Mastodon and a bunch of services and for $29/year, I can offer Mastodon, Lemmy, Matrix and Funkwhale, with 250GB of storage.
  - jszymborski 2y ago
    It's not "social washing" if it's actually a working co-operative. We all collectively own the funds, and if we ever want to lower yearly rates or pay our members dividends from surpluses, members are free to put it to a vote. Part of the reason we run a surplus is to deal with any unexpected costs (they don't just scale with users, but also the popularity of users on our server), but FWIW I think we should open up a pay-what-you-can tier much like social.coop has. Thanks for reminding me, I'll send it to the coop for consideration.
debo_ 2y ago
I love how this article about a co-op that values workers opens with a clearly AI-generated image that is indirectly derived from the effort of many unpaid artists.
- Viliam1234 2y ago
  Just like those artists have benefited from the unpaid effort of their ancestors who invented fire. Please let's stop acting as if contributing to civilization is some kind of horrible injustice. If you make a picture and someone steals it, okay that's not fair. If you make a picture and someone makes a copy, also not fair. But if you and million others make pictures, and someone else looks at them and learns how to make their own pictures... that's basically how people were doing it since ever. Except now this process can also be automated. Every artist who never studied the art of others, and invented their own style from scratch, has a right to complain, of course.
teruakohatu 2y ago
> Mondragon provides us with a successful, working model. It’s not throwing out capitalism, it’s creating a better form of it. Can any people from this region tell us what the downsides of working for Mondragon are? The article only touched on lower pay. Also how much does the President of the parent Mondragon Corp get paid? The often cited 6:1 or 9:1 lowest paid worker to CEO seems to be applied to CEOs of the various corporations not the president of the parent company.
- jonnybgood 2y ago
  In the OP: “Lorenzo estimates that the president of Mondragon is the highest-paid position (level 6) with a salary of around €200,000. Managers and directors earn between €80,000 and €120,000.”
  - ericd 2y ago
    So the president makes less than a middle manager in a Fortune 500 company. I hope there are some other benefits…
    - SamWhited 2y ago
      The article talks about this extensively; both the benefits, and the difficulty hiring American workers because of our (I'm assuming "our", but I suppose I don't know, there are plenty of other countries with similar cultural norms) more individual, selfish, culture.
      - ericd 2y ago
        Well I said that because being an exec tends to be much more stressful, and I saw the discussion about the difficulty in hiring engineers abroad, but not about the execs. But maybe it’s less stressful in a democratically run company where employees vote on plans.
    - bigbacaloa 2y ago
      [dead]
Aloisius 2y ago
The vast majority of Mondragon's revenue comes from foreign subsidiaries which, notably, are not worker-owned nor run democratically.
aussieguy1234 2y ago
Its interesting that Rojava wasn't mentioned here. After driving out Islamic State, they founded their own country in north east Syria, not widely internationally recognised yet but functioning much better than the rest of Syria. They are still a developing country and by no means wealthy, but the average income in this area is double what it is in the rest of the country. Their economy is built almost entirely on cooperatives. The government provides land and seed funding to get the cooperatives going https://www.hamptonthink.org/read/the-social-economy-of-rojava-a-primer-on-the-coop-model https://www.hamptonthink.org/read/the-social-economy-of-roja...
- cholantesh 2y ago
  Might be because since 2019 and the withdrawal of the US military presence in NE Syria, the relative prosperity of Rojava has plummeted. This draws into question exactly how 'autonomous' said autonomous zone was.
  - EasyMark 2y ago
    Yeah that's on of the things that get hand-wavity when you bring up these city-state type plans as well as anarcho-whatevers. They generally wouldn't be big enough to defend themselves from religious extremists or nation states acting against them--many of them not even figuring in defense against other entities and saying "we're pacifists". That kind of stuff only works when external factors like aggressive neighbors don't figure in.
    - jamil7 2y ago
      This is downvoted maybe due to its tone but I understand the general point here to be a valid and known issue with anarchist communities?
    - Apocryphon 2y ago
      I mean, if you're going to make that kind of political argument you can claim that Western Europe's postwar prosperity and relatively strong welfare states are a by-product of America footing the bill for defense (plus the seed investment of the Marshall Plan).
ofrzeta 2y ago
Seems to be not only a Spanish but a predominantly Basque enterprise. Cooperatives are relatively huge in Italy, too https://coops4dev.coop/en/4deveurope/italy https://coops4dev.coop/en/4deveurope/italy Although the structure is a bit less monolithic than Mondragon.
nickpinkston 2y ago
I've studied and visited Mondragon before, and hosted their students at my company. It's very cool, but I'm unsure how replicable the model really is. My conclusion is that it emerged out of the unique environment of already high Basque solidarity, but even more so under Franco's oppression. After a few generations, they admit that the hardcore spirit is gone and made initiatives to try to restore it, but still some of the biggest co-ops have died or been sold off (ie Fagor). My friends from there told me: "It's where your dumb cousin works", as it's very political with a lot of patronage kinds of networks that democratic elections at that scale tend to produce. They made a startup community there, but it seemed like most of the kids were trying to get out, not stay to reform the coop. I think the Italian Emilia Romagna region cooperatives [1] may be a less centralized model that could be better, as it does away with the big organization that eventually rots, like any big old org. [1] https://www.yesmagazine.org/economy/2016/07/05/the-italian-place-where-co-ops-drive-the-economy-and-most-people-are-members https://www.yesmagazine.org/economy/2016/07/05/the-italian-p...
- jrochkind1 2y ago
  thank you for these comments, makes sense to me.
- deleted 2y ago
  [deleted]
- calf 2y ago
  Based on what I've heard I'd love to visit there and even have a chance to intern there. I'd like to see for myself firsthand what life would be like. Would it be boring? Would it be bureaucratic or unmeritocratic? Would that bother me personally? I don't speak Spanish, unfortunately. Obviously this article gives a rosy picture. However, the renewed interest in alternatives is precisely due to the new forms of arbitrary oppression that 21st century capitalism inflicts on many people, so maybe that would be one pathway for Mondragon and other meta-coops to flourish. Who knows. Moreover, it's not like actually-existing capitalism doesn't tend to produce its own forms of inequality. Maybe a sociologist or economist could show that the "patronage networks" in something like Mondragon are an effect of their structure but the overall negative outcomes are lessened/mitigated compared to the negative social outcomes of Western capitalism. A proper comparison would be an open research question. That's too bad about Fagor, 10 years ago I ordered a pressure cooker from them but had it returned immediately due to an improper lid fit. That would've been around the time of its decline and eventual closing off. I ended up buying a 2x more expensive pot from a Swiss company, it's lasted me 10 years so far.
mharig 2y ago
[dead]
derelicta 2y ago
"Could we eventually create a capitalist paradise where democratically run companies use their profits for the good of their worker citizens? Could that even replace our existing governments?" Dude reinvented the socialist mode of production but renamed it "capitalism" instead lmao
svieira 2y ago
Another take on this kind of subsidiarity approach is Joel Salatin's "Memorandum of Understanding" which he talks about in detail in "Stacking Fiefdoms": https://www.youtube.com/watch?v=EbJc8i5B9RU https://www.youtube.com/watch?v=EbJc8i5B9RU
sturmbraut 2y ago
I read about Mondragon in Pickety's works. That's why I went to Mondragon. I was deeply disappointed, the city and the surroundings look very sad. It reminded me a lot of the former DDR (german "democratic" republic which was under russian control).
- ladyanita22 2y ago
  It's located in Spain, a country not known for its vast wealth. Plus, it's in a special administrative region in Spain, the Basque Country. They enjoy subsidies and favorable treatment from the regional government.
  - user-one1 2y ago
    Basque country is one of the richest regions in Spain, which is already a highly developed country. Not sure what you are talking about.
    - ladyanita22 2y ago
      I'm from Spain, so I'm quite sure of what I'm talking about. Spain might be a highly developed country, but its gdp per capita is not too high compared to the likes of Germany, UK, France, Denmark, US, et al. Basque country is, again, rich because it has an special tax treatment and could be considered a tax heaven to some extent.
      - nextos 2y ago
        The Basque Country has a GDP (PPP) of 108 [1]. Higher than France (101), as an average, or Italy (97). I'd say its a well developed region comparable to Northern Italy. Both were badly hit by the Euro. Had they kept their own currencies, they'd be closer to Sweden or Southern Germany. [1] https://www.eustat.eus/elementos/tbl0012365_i.html https://www.eustat.eus/elementos/tbl0012365_i.html
        ladyanita22 2y ago
jmyeet 2y ago
There is no value without labor. This was recognized by everyone from Karl Marx to Abraham Lincoln to Adam Smith. Smith even conceded that profit was impossible if workers retain their surplus value, which is exactly the point. I bring this up because that's what capitalism is: draining the surplus labor value from workers to the capital-owning class. In feudalism, the artistocracy and th emonarchy extracted that value. Jeff Bezos is the new king. Why do I mention this? Because it wasn't that long ago that this view was universally accepted. The Red Scare post-WW2 spread a lot of damaging propaganda that has led ordinary people to fight for the ultra-rich to have even more money, to their own detriment. Walmart killing all your local businesses then leaving, leaving you in a food desert with a Family Dollar store maybe. That's capitalism. Locally-owned businesses. That's socialism. Monsanto agribusiness? Capitalism. Family-owned farms? Socialism. Something like Mondragon shows that large-scale cooperatives can work. And the reason why these sorts of things aren't more prevalent is that laws are passed to make them difficult to set up or outright illegal. Many US states outlaw municipal broadband, for example. And any country in the last 70 years that even thinks about nationalizing resource extraction finds itself having a coup that nearly always has the CIA's fingerprints over it. Or we simply starve them to death under the sanitized euphemism of "economic sanctions" (eg Cuba, Iraq, Venezuela). I really want people to understand that we're not doing this for any moral reason. We're doing it at the behest of Western companies who would prefer to steal the riches of these countries. Co-operatives can go a lot further than manufacturing too. It can be a solution for housing. Housing cooperatives cut out landlords, who are rent-seeking both literally and figuratively.
- cholantesh 2y ago
  Most likely a message that's lost on anyone offering oblations while facing Cupertino everyday.
  - dontlaugh 2y ago
    More importantly, a message lost on an audience who largely is dreaming of being one of the exploiters.
    - 2y ago

249 points by jinjin2 2y ago

>If the model is a good one, detractors say it can’t be replicated outside of the Basque Country, and there’s some truth to that. The author doesn't speculate why, but I'd guess it's partly due to Basque ethnic solidarity. Mondragon sounds a lot like the kind of late 1800s / early 1900s syndicalism that later evolved into Italian fascism and German National Socialism. Of course, another big "collectivist capitalism" success story is China, which is also fiercely nationalist. I don't see either of those models working in the West on a large scale any time soon.

prmoustache 2y ago
Now Basque country is not considered "the West"?
- intalentive 2y ago
  >"on a large scale"
kmeisthax 2y ago
I've heard this story ever since I was a shit-eating Ron Paul voting right-libertarian. The whole "collectivist success requires ethnic purity" argument. I don't buy it. It is, inevitably, either an excuse to destroy functional collective institutions, an excuse to advocate for ethnic cleansing, or both.
- intalentive 2y ago
  To elaborate on my previous comment: if you want people to be less individualistic and more community-minded, and especially if you want economic organization to be more cooperative, decentralized and bottom-up, then people are going to need to feel a deep sense of buy-in and belonging, and you don't really see that in an undifferentiated mass of atomized "consuming and producing units". But you do see it among the Amish, and the Basques, and the Boers, and in the kibbutzim, and in families generally, because kin relations are meaningful among humans and elsewhere in the animal world. And I'm not arguing that "collectivist success requires ethnic purity", just noticing a correlation. Where you see apparent altruism in economics -- including nepotism in hiring -- you tend to find kin relations. Probably the game theorists and evolutionary psychologists have it figured out.
  - harwoodjp 2y ago
    It's true that, in those groups, a shared ethnic identity enables economic cooperation. But the lack of solidarity you observe is the result of a regime of coercion. The official policy: leave your neighborhood, family, friends, and passions for 40+ hours a week to build a capitalist's business. You have to do it to survive. And the police are there to make sure revolts don't break out.
    - ertian 2y ago
      The claim that work is inherently coercive is crazy to me. In order to live, we need food, clothing, shelter, comforts. Those take labor to produce. We've abstracted labor using money, allowing for specialization, so you can perform some specialized labor to provide for all your needs. The needs aren't forced upon you. They're inherent. Labor is required to meet the needs you must meet in order to live (and live in comfort). They'd be needed even if no board of directors had ever sat in a meeting room. So who's coercing you? It's like a farmer hating his field: you're mad that companies 'make' you work to survive; a farmer might hate his field for 'making' him plant seeds to produce food. I don't get it. It seems delusional.
      - harwoodjp 2y ago
        Automation makes jobs unnecessary. We should build social infrastructure that allows people to pursue their passions with basic necessities guaranteed. This has been possible for awhile now.
        chongli 2y ago
        Nonsense. You can’t feed people with machines. You need raw materials and you need land to produce those materials from. That productive land is already owned by a bunch of people who currently use it to grow food and sell at market for profit. Are you proposing we seize their land? That’s what the Soviets did. Millions died. With the weaponry we have today it could be hundreds of millions or billions. All for what? So people don’t have to work? Now suppose we do collectivize all the farms, this time miraculously without killing everyone, and we successfully set up the automation to feed everyone (despite the fact that a lot of crops still need to be picked by hand due to a lack of robot technology). We still don’t eliminate the need for work. There’s tons of other stuff to be done. Building houses, computers, trains, planes, automobiles, and new factory robots. There’s still tons of research going into all this stuff, maintenance and repair. People still need to do all this work. Who is going to pay them? Who is going to own what they produce? If I build a robot in my garage to automate harvesting the peppers I grow in my backyard, do I own it?
mikojan 2y ago
The importance of "leftist" fascism is overplayed. "Socialism" back then, much like "Human Rights" today, was generally associated with what is morally right. It was not an ideology of extremist groups. Fascism "evolved" from socialism same as everybody and their mother evolved from it. And because of its dominance, everybody tried to exploit it, too. So you called your organisation "National Socialist Party" and your heads of propaganda copied the rhetoric. Also, libertarian socialism was nowhere as developed as in Spanish society at that time. This is not the most surprising society to generate Mondragon.
- deleted 2y ago
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mikrl 2y ago
>Of course, another big "collectivist capitalism" success story is China, which is also fiercely nationalist. Yugoslavia had a dynamic market socialist economy and was powerful enough to align against the USSR for decades, yet was multi ethnic. It suffered from the typical authoritarian weak succession and was ultimately destroyed by its resurgent ethnic nationalism.
cholantesh 2y ago
>Mondragon sounds a lot like the kind of late 1800s / early 1900s syndicalism that later evolved into Italian fascism and German National Socialism. Sure, if you dishonestly use their slogans rather than policy decisions as your barometer. What actually happened is that fascists co-opted the language of the left and deployed it in service of entirely different ends.

abeppu 2y ago

A thing that is kind of glossed over is: what is "ownership" when we talk about worker-owners at cooperatives? > The profits generated by each cooperative are put to work for the benefit of the greater whole. Each cooperative gives 14-40% of their gross profits to their division (depending on the division), and another 14% to their parent company. The rest are invested back in the cooperative (60% of net profits), distributed among their employees (30% of net profits), and donated to social organizations in their communities (10% of net profits). > Workers buy into their cooperative when they become employees, investing up to €16,000 into a personal equity account. They pay 30% of that investment upfront, with the remainder taken out of their paychecks over following 2 to 7 years. After two years with the organization, workers become “members” and start earning interest on their investment at a rate of at least 7.5% annually. If the cooperative does well, they might earn much more than that. Workers can pull this money out of their accounts when they leave the cooperative or retire. ... so it's not ownership, right? It's profit-sharing while you're an employee (the "interest" the worker gets is out of that 30% of net profits discussed previously), but you don't own shares in the company that you can then sell, like an employee who receives an RSU or receives and exercises an option. In some sense, corporate employees that get some form of equity as part of their compensation are more literally worker-owners. I think the problem with American companies that have an employee stock plan is that the employee stock pool is a small slice of the total ownership, and employees don't participate in any real democratic governance. Despite being shareholders, they get far less information about the financial health or strategic position of the company than investors with board seats. Real partial ownership doesn't lead to real power or access to information. And the aim of the company is still to serve the larger investors, not the workers.

metabagel 2y ago
I think that more important than ownership is the purpose of the company. Most companies have the purpose of making money. Few have a purpose which includes contributing to quality of life, unless that’s something which can be sold for a profit.
- devman0 2y ago
  Not just making money, but making more money than they did last year, forever. Like a company can't just be cool with the fact that they serve a profitable market niche and gainfully employ people. Investors need capital gains and won't just be satisfied with getting reliable dividends! Stock buy backs ruined corporate governance...

samatman 2y ago

The difference between Mondragon, the kibbutzim, and other successful examples of collective labor, and the Soviet system, is precisely that the former are not governments, and operate in a capitalist system of property rights and free markets (in a practical rather than spherical cow sense of that term). I'm all for more cooperatives, it's a good model. Operating in a system which doesn't compel that form of organization is what keeps them honest. Mondragon is a profitable company, emphasis on profitable. The article talks a bit about how, while Mondragon is a pretty good deal for basic labor, they have trouble attracting high-demand talent like engineers, which they also need. In a free-market system, a worker's collective can solve a problem like that, by offering more perks, raising the 'level' for new engineering hires, waiving some amount of the up-front investment, or just getting by through, in effect, paying some of the salary in a nonmaterial reward of belonging to something which better meets some people's sense of ethics and fairness. That's not how it works when the company you work for is also the police and the military. It's also not how it works when every company is compelled to organize itself this way. That compulsion leads to dysfunction, corruption, cheating, and at the extreme end, gulags. So let's pass on all that. If you believe that worker cooperatives are a social good, as I do, buy stuff from them. Work for one, found one. It's working so far.

hn_throwaway_99 2y ago
> The difference between Mondragon, the kibbutzim, and other successful examples of collective labor, and the Soviet system, is precisely that the former are not governments... I've heard it put as "Socialism works great, as long as the socialist community gets to decide who is included."
cies 2y ago
The "soviet system" as you call, started (yes the revolution) with a slogan "power to the soviets". In the slogan the word "soviet" meant "worker coop". This slogan was abolished when more central planning took over, and the word soviet become more associated with the central govt/ the state.
- samatman 2y ago

m_ke 2y ago

It's a shame there's not a YC like incubator for tech worker coops, cut out the VCs and have milestone based funding in exchange for a percentage of future profits that would be reinvested in future projects.

cies 2y ago
It's inherent to the way a coop works that it's not possible to follow the same path. There is no 7% equity to be given, only the repayment of a loan. The coop model does not promote taking risk and hence have many fail, yet a few grow very quick. Another problem is law. At this point it favors the common ownership forms of business. Starting a coop is hence much harder than it should be. This is what i think where the "it's a shame" make most sense. We should make w-coops easier to start and give them tax benefits as they are on the long run much more beneficial/ less detrimental to society.
- jszymborski 2y ago
  I'm not a finance person, but my understanding is that co-ops more often raise capital with traditional loans. While I believe you are correct that co-ops are not a great fit for the growth business strategy that VCs make their bread and butter on, I believe that on many metrics co-ops tend to be more sustainable than the corporate alternatives[0]. This means they are more likely to be around tomorrow to pay off a loan. All this to say, it would be great to see more capital for co-ops in the form of traditional loans with favourable interest rates. [0] https://www.theguardian.com/social-enterprise-network/2014/mar/11/co-op-business-sustainability https://www.theguardian.com/social-enterprise-network/2014/m...
  - cies 2y ago
    > All this to say, it would be great to see more capital for co-ops in the form of traditional loans with favourable interest rates. Sure, that would be great. But what can govt do today to incentivize that? I'd say just relax (tax) law on w-coops to incentivize them compared to the less favorable forms of incorporation.

mempko 2y ago

For those astute, workers owning the means of production should sound familiar. Mondragon demonstrates that it can scale.

YossarianFrPrez 2y ago

It's interesting to read about Mondragon in more detail. I just came across the term in Kim Stanley Robinson's solar-system sci-fi epic "2312." The book (highly recommended) heavily references Mondragon; that's the name for the alliance / co-op of all of the planets and settlements that aren't Earth or Mars.

keyle 2y ago
Thanks for the book idea '2312', will check it out.

conaclos 2y ago

The anarchist culture of the 1800s and 1900s in Spain, especially the emergence of anarcho-syndicalist structures [0], is certainly one of the reasons for Mondagon's existence. [0] https://en.wikipedia.org/wiki/Anarcho-syndicalism https://en.wikipedia.org/wiki/Anarcho-syndicalism

api 2y ago
Why aren’t there more of these if they work well?
- harwoodjp 2y ago
  Why don't workers unite to democratically manage production? The police, propaganda, wage slavery.
  - deleted 2y ago
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  - nyokodo 2y ago
    > Why don't workers unite to democratically manage production? Because the majority of workers are doing the minimum amount of work to get by, because ~50% of workers are below average intelligence, because those with the entrepreneurial skill and/or business management competence necessary to make this happen benefit more from the current system and have less motivation to mess with it.
    - harwoodjp 2y ago
      [flagged]
      - K0balt 2y ago
        I can’t speak to op’s emotional well being, but he is spot on with his reasoning. In the rarified air that most of us here inhabit, it’s easy to forget that for every college professor there is someone for whom tying their shoes is a significant cognitive challenge. For every really smart person, there is someone who lacks the cognition to participate meaningfully in society. For every brilliant individual, there is someone whose mental capacity puts them in need of lifelong care. The bell curve is a bitch. The average person just gets by and doesn’t think all that much about anything outside of their immediate surroundings. For most, politics and such is a team sport, not an intellectual pursuit. It’s an uncomfortable fact of life, and those that have talents and gifts above the norm are by default responsible for guiding and advancing society. We ignore that burden at the peril of all.

qrush 2y ago

Just wanted to flag that there are areas in the US that co-operative enterprises do flourish and have knock-on effects. This is biased by my food co-operative experience but just to show that there is an alternative to unfettered capitalism where businesses help each other thrive. - The Minneapolis/St. Paul region has so many food co-ops that there's a co-operative warehouse dedicated to serving them (and other businesses too) https://www.cpw.coop/ https://www.cpw.coop/ - New England has a multitude of 30-40 year old food co-ops (along with startups like mine) and has its own association of food co-ops to help advocate for better state policy/governance http://nfca.coop/ http://nfca.coop/ - National Co-op Grocers is a US-wide group that helps co-ops buy food at cheaper rates and provides a ton of great branding food co-ops who are members get to use https://www.grocery.coop/ https://www.grocery.coop/ I'd love to see more tech co-operatives sprout up someday... there is an alternative to VC that keeps ownership equal, and it's been all around us this whole time!

disqard 2y ago
Are there any resources for learning about tech co-operatives in the USA? Do you happen to know any (specifically in tech), that you would recommend? Thanks!
- qrush 2y ago
  I still need to finish reading it, but this was published last year on the topic: https://www.versobooks.com/products/2839-own-this https://www.versobooks.com/products/2839-own-this
Optimal_Persona 2y ago
I also have a background in food co-ops (member owned), I was in the bakery of one for 7 years, then served on its board. Food co-ops are really interesting orgs because food is one of the things people can control in their lives so their feelings, neuroses, fears etc. come out. When we expanded about 17 years ago we managed to drive a new Whole Foods that had sprouted across town out of business within a year. Haven't heard of that happening elsewhere. They had a terrible location which didn't help but I think it was more due to the loyalty of our customers who had buy-in (literally).

jszymborski 2y ago

If: 1 - Cooperatives excite you and 2 - You use social media you might want to look at the social.coop Mastodon instance (or cosocial.ca if you're Canadian). Not only has the community on both those sites been a breath of total fresh air for me, I am not worried about the server I'm on having decide between disappearing and selling ads, and I feel like I'm partaking in a social enterprise. Just recently social.coop had an open vote on how to donate some of our surplus to the open software we use and organizations that promote cooperation. It's been so nice to see and be apart of.

fragmede 2y ago
That's neat! How is it funded?
- SamWhited 2y ago
  By the members; we all pay a tiny bit into the co-op each month. Most people pay 1 USD or GBP per month, if you use some of the other services we offer through organizational memberships in other co-ops (ie. we're a member of meet.coop for video calls, May First Co-op for Nextcloud and email and what not, etc.) then some people pay a bit more (normally no more than 3 to 5 USD or GBP).
rglullis 2y ago
Beware of social washing to justify higher costs. cosocial.ca charges CA$50 for its annual membership. Omg.lol charges $20/year for Mastodon and a bunch of services and for $29/year, I can offer Mastodon, Lemmy, Matrix and Funkwhale, with 250GB of storage.
- jszymborski 2y ago
  It's not "social washing" if it's actually a working co-operative. We all collectively own the funds, and if we ever want to lower yearly rates or pay our members dividends from surpluses, members are free to put it to a vote. Part of the reason we run a surplus is to deal with any unexpected costs (they don't just scale with users, but also the popularity of users on our server), but FWIW I think we should open up a pay-what-you-can tier much like social.coop has. Thanks for reminding me, I'll send it to the coop for consideration.

debo_ 2y ago

I love how this article about a co-op that values workers opens with a clearly AI-generated image that is indirectly derived from the effort of many unpaid artists.

Viliam1234 2y ago
Just like those artists have benefited from the unpaid effort of their ancestors who invented fire. Please let's stop acting as if contributing to civilization is some kind of horrible injustice. If you make a picture and someone steals it, okay that's not fair. If you make a picture and someone makes a copy, also not fair. But if you and million others make pictures, and someone else looks at them and learns how to make their own pictures... that's basically how people were doing it since ever. Except now this process can also be automated. Every artist who never studied the art of others, and invented their own style from scratch, has a right to complain, of course.

teruakohatu 2y ago

> Mondragon provides us with a successful, working model. It’s not throwing out capitalism, it’s creating a better form of it. Can any people from this region tell us what the downsides of working for Mondragon are? The article only touched on lower pay. Also how much does the President of the parent Mondragon Corp get paid? The often cited 6:1 or 9:1 lowest paid worker to CEO seems to be applied to CEOs of the various corporations not the president of the parent company.

jonnybgood 2y ago
In the OP: “Lorenzo estimates that the president of Mondragon is the highest-paid position (level 6) with a salary of around €200,000. Managers and directors earn between €80,000 and €120,000.”
- ericd 2y ago
  So the president makes less than a middle manager in a Fortune 500 company. I hope there are some other benefits…
  - SamWhited 2y ago
    The article talks about this extensively; both the benefits, and the difficulty hiring American workers because of our (I'm assuming "our", but I suppose I don't know, there are plenty of other countries with similar cultural norms) more individual, selfish, culture.
    - ericd 2y ago
      Well I said that because being an exec tends to be much more stressful, and I saw the discussion about the difficulty in hiring engineers abroad, but not about the execs. But maybe it’s less stressful in a democratically run company where employees vote on plans.
  - bigbacaloa 2y ago
    [dead]

Aloisius 2y ago

The vast majority of Mondragon's revenue comes from foreign subsidiaries which, notably, are not worker-owned nor run democratically.

aussieguy1234 2y ago

Its interesting that Rojava wasn't mentioned here. After driving out Islamic State, they founded their own country in north east Syria, not widely internationally recognised yet but functioning much better than the rest of Syria. They are still a developing country and by no means wealthy, but the average income in this area is double what it is in the rest of the country. Their economy is built almost entirely on cooperatives. The government provides land and seed funding to get the cooperatives going https://www.hamptonthink.org/read/the-social-economy-of-rojava-a-primer-on-the-coop-model https://www.hamptonthink.org/read/the-social-economy-of-roja...

cholantesh 2y ago
Might be because since 2019 and the withdrawal of the US military presence in NE Syria, the relative prosperity of Rojava has plummeted. This draws into question exactly how 'autonomous' said autonomous zone was.
- EasyMark 2y ago
  Yeah that's on of the things that get hand-wavity when you bring up these city-state type plans as well as anarcho-whatevers. They generally wouldn't be big enough to defend themselves from religious extremists or nation states acting against them--many of them not even figuring in defense against other entities and saying "we're pacifists". That kind of stuff only works when external factors like aggressive neighbors don't figure in.
  - jamil7 2y ago
    This is downvoted maybe due to its tone but I understand the general point here to be a valid and known issue with anarchist communities?
  - Apocryphon 2y ago
    I mean, if you're going to make that kind of political argument you can claim that Western Europe's postwar prosperity and relatively strong welfare states are a by-product of America footing the bill for defense (plus the seed investment of the Marshall Plan).

ofrzeta 2y ago

Seems to be not only a Spanish but a predominantly Basque enterprise. Cooperatives are relatively huge in Italy, too https://coops4dev.coop/en/4deveurope/italy https://coops4dev.coop/en/4deveurope/italy Although the structure is a bit less monolithic than Mondragon.

nickpinkston 2y ago

I've studied and visited Mondragon before, and hosted their students at my company. It's very cool, but I'm unsure how replicable the model really is. My conclusion is that it emerged out of the unique environment of already high Basque solidarity, but even more so under Franco's oppression. After a few generations, they admit that the hardcore spirit is gone and made initiatives to try to restore it, but still some of the biggest co-ops have died or been sold off (ie Fagor). My friends from there told me: "It's where your dumb cousin works", as it's very political with a lot of patronage kinds of networks that democratic elections at that scale tend to produce. They made a startup community there, but it seemed like most of the kids were trying to get out, not stay to reform the coop. I think the Italian Emilia Romagna region cooperatives [1] may be a less centralized model that could be better, as it does away with the big organization that eventually rots, like any big old org. [1] https://www.yesmagazine.org/economy/2016/07/05/the-italian-place-where-co-ops-drive-the-economy-and-most-people-are-members https://www.yesmagazine.org/economy/2016/07/05/the-italian-p...

jrochkind1 2y ago
thank you for these comments, makes sense to me.
deleted 2y ago
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calf 2y ago
Based on what I've heard I'd love to visit there and even have a chance to intern there. I'd like to see for myself firsthand what life would be like. Would it be boring? Would it be bureaucratic or unmeritocratic? Would that bother me personally? I don't speak Spanish, unfortunately. Obviously this article gives a rosy picture. However, the renewed interest in alternatives is precisely due to the new forms of arbitrary oppression that 21st century capitalism inflicts on many people, so maybe that would be one pathway for Mondragon and other meta-coops to flourish. Who knows. Moreover, it's not like actually-existing capitalism doesn't tend to produce its own forms of inequality. Maybe a sociologist or economist could show that the "patronage networks" in something like Mondragon are an effect of their structure but the overall negative outcomes are lessened/mitigated compared to the negative social outcomes of Western capitalism. A proper comparison would be an open research question. That's too bad about Fagor, 10 years ago I ordered a pressure cooker from them but had it returned immediately due to an improper lid fit. That would've been around the time of its decline and eventual closing off. I ended up buying a 2x more expensive pot from a Swiss company, it's lasted me 10 years so far.

mharig 2y ago

[dead]

derelicta 2y ago

"Could we eventually create a capitalist paradise where democratically run companies use their profits for the good of their worker citizens? Could that even replace our existing governments?" Dude reinvented the socialist mode of production but renamed it "capitalism" instead lmao

svieira 2y ago

Another take on this kind of subsidiarity approach is Joel Salatin's "Memorandum of Understanding" which he talks about in detail in "Stacking Fiefdoms": https://www.youtube.com/watch?v=EbJc8i5B9RU https://www.youtube.com/watch?v=EbJc8i5B9RU

sturmbraut 2y ago

I read about Mondragon in Pickety's works. That's why I went to Mondragon. I was deeply disappointed, the city and the surroundings look very sad. It reminded me a lot of the former DDR (german "democratic" republic which was under russian control).

ladyanita22 2y ago
It's located in Spain, a country not known for its vast wealth. Plus, it's in a special administrative region in Spain, the Basque Country. They enjoy subsidies and favorable treatment from the regional government.
- user-one1 2y ago
  Basque country is one of the richest regions in Spain, which is already a highly developed country. Not sure what you are talking about.
  - ladyanita22 2y ago
    I'm from Spain, so I'm quite sure of what I'm talking about. Spain might be a highly developed country, but its gdp per capita is not too high compared to the likes of Germany, UK, France, Denmark, US, et al. Basque country is, again, rich because it has an special tax treatment and could be considered a tax heaven to some extent.
    - nextos 2y ago
      The Basque Country has a GDP (PPP) of 108 [1]. Higher than France (101), as an average, or Italy (97). I'd say its a well developed region comparable to Northern Italy. Both were badly hit by the Euro. Had they kept their own currencies, they'd be closer to Sweden or Southern Germany. [1] https://www.eustat.eus/elementos/tbl0012365_i.html https://www.eustat.eus/elementos/tbl0012365_i.html
      - ladyanita22 2y ago

jmyeet 2y ago

There is no value without labor. This was recognized by everyone from Karl Marx to Abraham Lincoln to Adam Smith. Smith even conceded that profit was impossible if workers retain their surplus value, which is exactly the point. I bring this up because that's what capitalism is: draining the surplus labor value from workers to the capital-owning class. In feudalism, the artistocracy and th emonarchy extracted that value. Jeff Bezos is the new king. Why do I mention this? Because it wasn't that long ago that this view was universally accepted. The Red Scare post-WW2 spread a lot of damaging propaganda that has led ordinary people to fight for the ultra-rich to have even more money, to their own detriment. Walmart killing all your local businesses then leaving, leaving you in a food desert with a Family Dollar store maybe. That's capitalism. Locally-owned businesses. That's socialism. Monsanto agribusiness? Capitalism. Family-owned farms? Socialism. Something like Mondragon shows that large-scale cooperatives can work. And the reason why these sorts of things aren't more prevalent is that laws are passed to make them difficult to set up or outright illegal. Many US states outlaw municipal broadband, for example. And any country in the last 70 years that even thinks about nationalizing resource extraction finds itself having a coup that nearly always has the CIA's fingerprints over it. Or we simply starve them to death under the sanitized euphemism of "economic sanctions" (eg Cuba, Iraq, Venezuela). I really want people to understand that we're not doing this for any moral reason. We're doing it at the behest of Western companies who would prefer to steal the riches of these countries. Co-operatives can go a lot further than manufacturing too. It can be a solution for housing. Housing cooperatives cut out landlords, who are rent-seeking both literally and figuratively.

cholantesh 2y ago
Most likely a message that's lost on anyone offering oblations while facing Cupertino everyday.
- dontlaugh 2y ago
  More importantly, a message lost on an audience who largely is dreaming of being one of the exploiters.
  - 2y ago