Wednesday, February 22, 2012

Cooperative Success Confounds Liberals, Analysts Alike

From: Portside Moderator [mailto:moderator@PORTSIDE.ORG]
Sent: Tuesday, February 21, 2012 12:43 PM

Cooperative Success Confounds Liberals, Analysts Alike

By Matthew Martin Staff Reporter
The Exponent (Purdue - West Lafayette,Ind) February 17, 2012

Analysts said it couldn't happen and liberals said it was too early to come,
but the Spanish cooperative of Mondragon has grown into a global powerhouse.

The Mondragon cooperative of 120 different companies was the focus of Carl
Davidson, a writer and the national co-chair of the Committees of
Correspondence for Democracy and Socialism, who talked on Thursday to a
sparse audience in Lawson Hall. The speech was sponsored by the Committee on
Peace Studies and the Latin American and Latino Studies Program.

Mondragon is the largest cooperative in the world. The cooperative has been
successful in a wide array of businesses including industry, research, and

"Think about a platypus. When they discovered them (Mondragon), it wasn't
supposed to exist," Davidson said.

An unusual aspect of the cooperative is all the workers are owners of the
company. Every worker gets one vote and a paycheck based on the company's
profits rather than a wage.

"The workers in Mondragon are not normal workers. They are not wage
laborers," Davidson said.

Davidson spoke of how the cooperative has become the seventh-largest
business group in Spain because of the core principles made by the founder,
José María Arizmendiarrieta Madariaga. Arizmendiarrierta was a priest who
first founded a small credit union that grew into Mondragon.

Davidson said Mondragon operates on several principles including
application, pay solidarity, and the soverignty of labor. Davidson said
Mondragon has its own bank to keep money within the cooperative.

"Capital is subservient to labor. That's why the bank is owned by the
cooperative," Davidson said.

Davidson said the workers of Mondragon are paid well and the differences in
pay between an executive and a janitor are not very broad.

"In Mondragon the average spread is one to nine from the guy who sweeps the
floor to the head honcho. In the U.S. it would be one to 9,000," Davidson

One of the main principles of the cooperative is to take a three-in-one
approach to business said Davidson.
Davidson said the cooperative prides itself on its factory, school and
credit unit aspects. He said it's possible for companies to become a
cooperative but that they need to accomplish a few goals.

"First, the workers have to want to do it. Second, the workers have to trust
each other. Third, you need a decent business plan," Davidson said.

Mondragon is working in other countries than Spain.
Mondragon recently made an agreement to work with the United Steel Workers
of the United States but things are moving slowly. Davidson said several
other cooperatives, such as the Cleveland Evergreen Cooperatives, were
influenced by Mondragon.

"The U.S. is a very easy place to start a co-op and a very easy place to
fail," Davidson said.

Audience members seemed very interested in the idea of a cooperative. Elena
Benedicto, an associate professor in the College of Liberal Arts, said she
thought it was an interesting idea for workers to own their positions and

"Those companies are household names and you would never expect that they
are cooperatives," Benedicto said.


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