Wednesday 3 October 2012

Mondragón: There is an alternative

“There is no alternative.” That is the motto that seems to currently dominate the political discourse in Europe. The other day I read a story on the Guardian that got me thinking… Ed Miliband, head of the British Labour Party, said that “capitalism is the least worst system we’ve got.” The goal of his party is not the abolition of capitalism, but the taming of the creativity towards a “decent” and “humane capitalism.” As opposed to the Cold War era, nowadays it is rare that financial capitalism as a whole is question, even within parties where one may expect it.

Nevertheless there are alternatives, albeit not state-centred ones. Kim Stanley Robinson, one of my favourite science-fiction authors, used his Mars Trilogy to portray the colonisation of Mars, and its transformation into a more hospitable world. He describes very realistically how a new society might develop outside the Earth’s biosphere, freed from the archaic and deeply-rooted value-systems and dogmas. Robinson’s books may have been written in the 1990s, but he recognised in an almost prophetic manner the enormous potential of cooperatives. He refers particularly to the Mondragon Corporation, the world’s largest cooperative, and one of the ten biggest Spanish companies. This post is meant to describe this very feasible alternative to the capitalist mode of production, which can be implemented without revolutions of paradigm shifts, and that very successfully.

Mondragon focuses on social justice and not profit
The Mondragon Corporation was founded by the Catholic priest José Maria Arizmendiarrieta in the 1950s, in the fact of Spanish mass unemployment. In 2011 83,560 people worked at Mondragon. Mondragon consists of over 100 enterprises, and produces fridges, escalators, machine parts, and other specialised equipment. Eroski, one of the largest Spanish supermarket chains is equally part of Mondragon. A new employee can buy herself a share of the company after six months for €12,000. That money will be used for investment and innovation, as well as for social purposes. In return an employee will become an integral part of the cooperative. The managers of Mondragon are elected once a year by a general assembly of all employees, and the business structure of the company is completely democratic; on all levels the employees themselves decide about the future of Mondragon. Every worker feels personally responsible for the cooperative, and employees display the kind of knowledge about their company that is usually only seen among managers. But that is not the only area where Mondragon sets revolutionary standards: the executives may only earn up to 8 times as much as the minimum salary of a simple worker. Nearly every employee ears more though, which is why this gap is really far smaller. One needs to take into consideration that we are talking about a company will an annual turn-over of €15 billion. Josef Ackermann, former CEO of Deutsche Bank, used to earn 400 times as much as the average employee, and in many companies of a similar size those kinds of proportions are no rarity. In the city of Mondragon, where the Mondragon Corporation was founded, unemployment is only 8%, compared with a nation-wide unemployment of 25%. In spite of the crisis no jobs were destroyed; due to the large number of enterprises that are part of Mondragon, workers could be allocated according to demand. Mondragon thus provides us with a role model of a successful cooperative. Between 1990 and 2011 the number of employees has quadrupled.

Mondragon is a role model in many ways. One the hand, it shows the advantages of a coordinated labour market which could allow “redundancies” to become unnecessary. As the employees themselves manage the company, motivation is much higher. On the other hand, a democratic enterprise structure is simply more just! Gramsci writes that a hegemonic structure can only brought down by the establishment of a counter-hegemony. The transformation of purely profit-oriented companies into cooperatives could form the substance of such a counter-hegemony.

I’m going to end this post with a quote by Kim Stanley Robinson: “The system called capitalist democracy was not really democratic at all. […] So. We must change. If self-rule is a fundamental value, if simple justice is a value, then they are valuable everywhere, including the workplaces where we spend so much of our lives.” So that’s that.

Harald Köpping

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