International Developments

Many examples of community wealth building can also be found in other countries, including the well-known worker cooperative movement in Argentina, which has seen hundreds of worker co-ops open their doors over the past two decades. Many of the co-ops, known as empresas recuperadas de trabajo (worker-recovered businesses), emerged out of the economic collapse in 2001, in which workers occupied abandoned factories and put them back into operation under worker self-management. (See Box 18–1.)

Another prominent non-U.S. example is provided by the Mondragón cooperatives. In 1943, a Spanish priest, Father José María de Arizmendiarrieta (1915–1976), founded a technical school in the small city of Mondragón, in the Basque region of Spain. In 1956, five graduates of that school helped found a worker cooperative called Ulgor, which initially employed 24 people and produced kerosene stoves. In 1959, a cooperative bank, Caja Laboral, was founded, which proved to be a critical vehicle for financing ongoing expansion. United today by a worker-controlled holding company, the Mondragón Cooperative Corporation has grown to consist of 257 businesses, including the Eroski retail chain with over 200 hypermarkets, super-

Box 18–1. Ten Years On: Argentina's “Recuperated” Worker-Owned Factories

In the late 1990s, Argentina entered an economic depression that led to shattering unemployment, inflation, default on foreign debt, and ultimately the fall of the government. One response to the economic upheaval was the empresas recuperadas, or “worker-recovered businesses.” This movement gained enormous momentum after the collapse, when foreign investors saw their businesses in Argentina's industrial sector crumble, and consequently closed up shop.

Workers at some of these factories, who already knew how to run the businesses and operate the machines, refused to let their former workplaces lie cold and vacant while they were out of work. One by one, they began to occupy their factories and demand the right to work (protected under Argentina's constitution) and to resume production as worker-owned cooperatives.

Their logic was simple: since their labor produced all the added value for the products and because their employers had walked away from their businesses, it was their only option and also their right to run the factories themselves, under horizontal direct democracy. Once a group of workers decided to take over a factory, a long and often complicated judicial process awaited them. They camped out, sometimes for months, in or near their workplaces to ensure that the former bosses didn't gut the factory and sell the machines in the middle of the night. Early in the process, many occupations were repressed and police turned violent as they tried repeatedly to evict the entrenched co-op members. But the process has now become more streamlined and normalized.

Some 300 businesses now operate under worker control as cooperatives in Argentina. Not all are “recuperated,” but each has been motivated and inspired by the promise of direct democracy in the workplace and the struggle of their fellow workers. Times remain difficult for everyone, and prosperity is still an intangible goal for many small business owners. Many of the co-ops keep daily operations running smoothly, but they have few savings and no access to bank loans or the pension programs that are available to traditional businesses. As a result, in addition to the difficult economic conditions, these businesses cannot use many standard tools of the financial system because banks do not recognize their management structure. Worker-owners are often fiercely proud of how far they have come and are both undaunted and realistic about the challenges in the future.

The economy remains shaky in Argentina, with an annual inflation rate of around 30 percent. Investing with Argentinean pesos is unwise. The frustrating lack of transparency surrounding most monetary transactions complicates efforts to conduct business at all—making it all the more remarkable that a small cadre of workerowned businesses has begun to flourish in the economic rubble. Worker ownership means banding together with a few other workers and operating a business without a formal boss, making decisions about production and hiring with a one-worker, one-vote direct democracy. In Argentina, worker ownership demands trust against all odds, requiring faith in neighbors and communities when the general economy and the job market cannot be relied upon to provide a living.

This movement has inspired immense hope for many around the world who saw factory occupation and recuperation as the beginning of a paradigm shift—a chance to build a new system within the broken shell of globalized capitalism. In the United States, this flood of energy and idealism was captured in The Take, a film by Naomi Klein and Avi Lewis, which outlines the struggle of one cooperative to gain control of production in their former workplace. For many, the Argentine cooperative movement offers lessons and inspiration for building a production system that embodies some fairly radical principles while remaining connected to mainstream markets. Whether those lessons will survive translation to other venues remains to be seen.

—Nora Leccese Senior economics major, University of Colorado Boulder Source: See endnote 26.

markets, and convenience stores, and Mondragón University, which offers training in management and business skills. With a workforce of more than 80,000, Mondragón, according its website, had revenues in 2012 exceeding

€14 billion ($19 billion).

Consumer cooperatives are used widely internationally as well. The

United Kingdom, the birthplace of the modern cooperative movement, is home to the world's largest single co-op, The Co-operative Group, which runs a broad range of member-owned enterprises, employs more than 90,000 people, and is co-owned by 7.6 million members. The Co-operative Group operates more than 2,800 food stores, 750 pharmacies, and 300 bank branches, as well as the U.K.'s largest funeral home company.

Some countries have both strong consumer and worker co-op movements. In the Emilia Romagna region of Italy, roughly 60 percent of the region's 4.4 million inhabitants belong to at least one co-op. In the region, around 80,000 people work for a worker-owned cooperative. This is around 6 percent of the total workforce and 1.8 percent of the total population. In Bologna, 10 percent of the population works for a co-op.

In Japan, the Seikatsu Club network includes both consumer co-ops and worker collectives, with a total membership of 307,000. The Seikatsu Club began in 1965, when several young activists organized 200 women (mostly homemakers) in Tokyo to form a buying club for the daily purchase of 300 bottles of milk. Over time, the cooperative extended the collective buying system to a range of other products, such as rice, fruit, frozen fish, household appliances, clothing, toys, and travel tickets, and developed its own product line of over 60 items.

The Seikatsu Club now owns several dairies, a beef ranch, and a soap factory. It also has helped its membership, mainly middle-aged, middle-class Japanese women, to re-enter the workforce through worker collectives, the first of which was launched in 1992. Today, 582 such collectives employing more than 17,000 people engage in such activities as food distribution, food preparation, catering, recycling, childcare, and education.

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