Re: Corporations/Side Issue
Mike B. writes: I'm wondering about these pressures to cut costs which Chomsky refers to. Don't they lead to the big, nice co:operative having to try to find cheaper sources of material via low wage, usually dictatorial political states? FWIW, David Schweikert's market socialist utopia of worker-managed co-operatives has two major institutions that are aimed at preventing the co-ops' profit-maximization from turning into this kind of thing: 1) a minimum wage, so that profit-max doesn't involve co-ops competing via a race to the bottom among themselves. [I think there must also be some rule about not hiring non-co-op members to do work. But I don't remember it.} 2) a special tariff on imports from countries that don't live up to labor standards. In this case, the revenues collected by making these imports more expensive to domestic consumers are supposed to be returned to the country whose imports are taxed as a lump sum (development aid). Jim Devine
Re: Corporations/Side Issue
Just to supplement Jim's comments, in Mondragon wages were set at comparable outside market wages and then profits at the end of the year were allocated to individual members savings funds which would be paid out on retirement. The purpose was to build up funds for investment in expanding the coops without having to rely on the commercial money market or banking system. All employees were required to become members except for specialists brought in for short term projects (e.g. an engineer hired to design a new product or process.) Wage differentials were regulated with a maximum differential of 3 to 1 although last I heard, they were considering raising this to 6 to 1 because of the difficulty they were having in attracting professionals as members as the co-ops moved more and more into high tech areas and into research and development. In the case of Yugoslavia, wages were set by the workers councils, usually at levels suggested by the managers. With the 1974 constitutional changes that introduced contractual self-management and the 1976 Law on Associated Labour, the financing of investment was abandoned by the state and the independent banks and was transfered to the enterprises from retained earnings and borrowings from their captive banks. This led to what became known as the 'Yugoslav disease' because the workers would distribute all the earnings in the form of wages leaving nothing for reinvestment. The enterprises would then borrow from their captive banks which basically printed the money with the resulting inflation that really was a major factor in the collapse of the system. This was, of course, illegal under Yugoslav law but by then the state authority was so dispersed and self-management so intrenched that little was done to curb it. Horvat claims, and I think he is right, that the real mistake was to abolish the state investment funds. It was during the time of the state investment funds (the period of market socialism) that the rate of economic growth and wage growth was at its highest. Nevertheless, the self-management system of setting wages did result in the most egalitarian distribution of wages in Europe, both in the capitalist and communist worlds. Paul P Devine, James wrote: Mike B. writes: I'm wondering about these pressures to cut costs which Chomsky refers to. Don't they lead to the big, nice co:operative having to try to find cheaper sources of material via low wage, usually dictatorial political states? FWIW, David Schweikert's "market socialist" utopia of worker-managed co-operatives has two major institutions that are aimed at preventing the co-ops' profit-maximization from turning into this kind of thing: 1) a minimum wage, so that profit-max doesn't involve co-ops competing via a race to the bottom among themselves. [I think there must also be some rule about not hiring non-co-op members to do work. But I don't remember it.} 2) a special tariff on imports from countries that don't live up to labor standards. In this case, the revenues collected by making these imports more expensive to domestic consumers are supposed to be returned to the country whose imports are taxed as a lump sum (development aid). Jim Devine Paul Phillips, Senior Scholar, Department of Economics, University of Manitoba
Re: Corporations/Side Issue
--- Devine, James [EMAIL PROTECTED] wrote: Mike B. writes: I'm wondering about these pressures to cut costs which Chomsky refers to. Don't they lead to the big, nice co:operative having to try to find cheaper sources of material via low wage, usually dictatorial political states? FWIW, David Schweikert's market socialist utopia of worker-managed co-operatives has two major institutions that are aimed at preventing the co-ops' profit-maximization from turning into this kind of thing: 1) a minimum wage, so that profit-max doesn't involve co-ops competing via a race to the bottom among themselves. [I think there must also be some rule about not hiring non-co-op members to do work. But I don't remember it.} 2) a special tariff on imports from countries that don't live up to labor standards. In this case, the revenues collected by making these imports more expensive to domestic consumers are supposed to be returned to the country whose imports are taxed as a lump sum (development aid). Jim Devine Thanks Jim. These reforms sound very nice and I'm sure that most people would be happier if they were put in force. Still, I remain sick to death of the poltical-economy of commodity production. Best, Mike B) = ...the safest course is to do nothing against one's conscience. With this secret, we can enjoy life and have no fear from death. Voltaire http://profiles.yahoo.com/swillsqueal __ Do you Yahoo!? Yahoo! Mail - More reliable, more storage, less spam http://mail.yahoo.com
Re: Corporations/Side Issue
Thanks for those insights, Paul. I really do appreciate them. They do confirm my suspicions about how the wages system and commodity production, no matter how nicely controlled, have historically tended in the direction of re-creating the social relation we know as Capital and the eventual domination of corporations and their States--totalitarian forms of economic and political rule. IMO, one needs to go in the opposite direction, away from commodity prodution and the wages system, in order to get to a classless association of producers who socially manage the means of production/consumption for use and need. Regards, Mike B) --- paul phillips [EMAIL PROTECTED] wrote: Just to supplement Jim's comments, in Mondragon wages were set at comparable outside market wages and then profits at the end of the year were allocated to individual members savings funds which would be paid out on retirement. The purpose was to build up funds for investment in expanding the coops without having to rely on the commercial money market or banking system. All employees were required to become members except for specialists brought in for short term projects (e.g. an engineer hired to design a new product or process.) Wage differentials were regulated with a maximum differential of 3 to 1 although last I heard, they were considering raising this to 6 to 1 because of the difficulty they were having in attracting professionals as members as the co-ops moved more and more into high tech areas and into research and development. In the case of Yugoslavia, wages were set by the workers councils, usually at levels suggested by the managers. With the 1974 constitutional changes that introduced contractual self-management and the 1976 Law on Associated Labour, the financing of investment was abandoned by the state and the independent banks and was transfered to the enterprises from retained earnings and borrowings from their captive banks. This led to what became known as the 'Yugoslav disease' because the workers would distribute all the earnings in the form of wages leaving nothing for reinvestment. The enterprises would then borrow from their captive banks which basically printed the money with the resulting inflation that really was a major factor in the collapse of the system. This was, of course, illegal under Yugoslav law but by then the state authority was so dispersed and self-management so intrenched that little was done to curb it. Horvat claims, and I think he is right, that the real mistake was to abolish the state investment funds. It was during the time of the state investment funds (the period of market socialism) that the rate of economic growth and wage growth was at its highest. Nevertheless, the self-management system of setting wages did result in the most egalitarian distribution of wages in Europe, both in the capitalist and communist worlds. Paul P Devine, James wrote: Mike B. writes: I'm wondering about these pressures to cut costs which Chomsky refers to. Don't they lead to the big, nice co:operative having to try to find cheaper sources of material via low wage, usually dictatorial political states? FWIW, David Schweikert's market socialist utopia of worker-managed co-operatives has two major institutions that are aimed at preventing the co-ops' profit-maximization from turning into this kind of thing: 1) a minimum wage, so that profit-max doesn't involve co-ops competing via a race to the bottom among themselves. [I think there must also be some rule about not hiring non-co-op members to do work. But I don't remember it.} 2) a special tariff on imports from countries that don't live up to labor standards. In this case, the revenues collected by making these imports more expensive to domestic consumers are supposed to be returned to the country whose imports are taxed as a lump sum (development aid). Jim Devine Paul Phillips, Senior Scholar, Department of Economics, University of Manitoba = ...the safest course is to do nothing against one's conscience. With this secret, we can enjoy life and have no fear from death. Voltaire http://profiles.yahoo.com/swillsqueal __ Do you Yahoo!? Yahoo! Mail - More reliable, more storage, less spam http://mail.yahoo.com
Re: Corporations/Side Issue
--- paul phillips [EMAIL PROTECTED] wrote: Mike B wrote I agree, it would be much better, if workers ran and managed the the firms in which they exploited themselves for surplus value. Honestly though, hasn't the history of creating such entities, like say Mondragon or the Amana Colony or the kibbutz movement and all the utopian socialist movements of the past-- co:operatives included--proven that they always morph into the undemocratic, totalitarian corporate structures which we see ruling us today? In other words, hasn't wage-labour always resulted in the developement of capitalist social relations? Sincerely, Mike B) What evidence is there that Mondragon has morphed into an undemocratic, totalitarian corporate structure? Last I heard it was still going strong and expanding without any change in its co-operative structure. Check out the Mondragon website. I'm wondering about these pressures to cut costs which Chomsky refers to. Don't they lead to the big, nice co:operative having to try to find cheaper sources of material via low wage, usually dictatorial political states? And apologies to all (especially to jks) for bringing this topic up again. I just don't see a way out of the tendency of the rate of exploitation to increase as the rate of democracy decreases in economies dominated by the politics of commodification. Regards, Mike B) *** Re Mondragon Reply from NC, to Jeremy Gibson, on Mondragon. You're right to take this very seriously, in my opinion. It is a very substantial experiment in participant-owned economy, including production, finance, commerce and retail; and in terms of standard economic measures, it's been quite successful. There have also been problems. To what extent these derive from implantation within a state capitalist economy of the standard kind (e.g., the pressure to shift production to low-wage high-repression areas where workers will not be owners, violating the original principle that kept this to below 10% of the workforce) or to inherent factors of institutional structure (such as separation of professional management from workforce) is not so easy to determine, and merits careful thought. There is a lot of literature on the topic. A couple of fairly recent books are David Ellerman, _The Democratic Worker-Owned Firm_, and William Kathleen Whyte, _Making Mondragon_. There was a review a year or two ago by Mike Long in Libertarian Labor Review that I thought was quite well-informed, perceptive, and interesting (it was, incidentally, critical of my own criticism of Mondragon for hierarchic managerial structures); my understanding is that he might be a little less optimistic about the prospects himself, right now. Whatever one's assessment, this is an extremely important endeavor, in my opinion, and should be carefully studied. Noam Chomsky http://www.zmag.org/forums/chomforumacrh.htm = ...the safest course is to do nothing against one's conscience. With this secret, we can enjoy life and have no fear from death. Voltaire http://profiles.yahoo.com/swillsqueal __ Do you Yahoo!? Yahoo! Mail - More reliable, more storage, less spam http://mail.yahoo.com
Re: Corporations/Side Issue
This threatens to lapse into the dreaded market socialism debate. I do not want to get into that, and Michael won't allow it anyway. I will just say here, very briefly, that we do not know, but (a) the case of Mondragon is not so bad, and is unlike the others, and (b) there may be a difference between attempts to create a worker-controlled island in a capitalist sea, and the operation of worker-controlled enterprisers (whether corporations or other enterprise forms) where there is no or little wage labor, and they are the dominant form. I should mention (c) that at least one possible form of a worker-controlled enterprise is one in which the workers are not wage laborers but cooperators whose remuneration takes the form of a profit share rather than a wage. In my opinion, if something like a socialist market economy won't be stable and better than capitalism, then capitalist social democracy on the Western European model is the best we can do. For reasons you can look up in the PEN-L archives where I and othersd have discussed the issues, or can read in books -- I won't discuss them here -- I don't think that a nonmarket econimy would be either stable or better. But leave the point be. We are not faced today in America with a choice of any of these alternatives. If we could get social democracy, we'd think the revolution was over and we'd won. But it as utopian from where we stand as Marx's communism. jks --- Mike Ballard [EMAIL PROTECTED] wrote: --- andie nachgeborenen [EMAIL PROTECTED] wrote: Moreover one could imagibe a market society where, for eaxmple, the corporations did not have undemocratic power and wealth, and where the workers managed them themselves. Such corporations would be far less problematic than the largest ones we have -- including some of my clients. jks I agree, it would be much better, if workers ran and managed the the firms in which they exploited themselves for surplus value. Honestly though, hasn't the history of creating such entities, like say Mondragon or the Amana Colony or the kibbutz movement and all the utopian socialist movements of the past-- co:operatives included--proven that they always morph into the undemocratic, totalitarian corporate structures which we see ruling us today? In other words, hasn't wage-labour always resulted in the developement of capitalist social relations? Sincerely, Mike B) = Beers fall into two broad categories: Those that are produced by top-fermenting yeasts (ales) and those that are made with bottom-fermenting yeasts (lagers). http://profiles.yahoo.com/swillsqueal __ Do you Yahoo!? Yahoo! Search - Find what youre looking for faster http://search.yahoo.com __ Do you Yahoo!? Yahoo! Search - Find what youre looking for faster http://search.yahoo.com
Corporations/Side Issue
Mike B wrote I agree, it would be much better, if workers ran and managed the the firms in which they exploited themselves for surplus value. Honestly though, hasn't the history of creating such entities, like say Mondragon or the Amana Colony or the kibbutz movement and all the utopian socialist movements of the past-- co:operatives included--proven that they always morph into the undemocratic, totalitarian corporate structures which we see ruling us today? In other words, hasn't wage-labour always resulted in the developement of capitalist social relations? Sincerely, Mike B) What evidence is there that Mondragon has morphed into an undemocratic, totalitarian corporate structure? Last I heard it was still going strong and expanding without any change in its co-operative structure. Check out the Mondragon website. On the theory of 'market socialism' more up to date than Vanek and the others mentioned is Bruno Jossa and Gaetano Cuomo, The Economic Theory of Socialism and the Labour-Managed Firm. (EdwardElgar, 1997). I also like Branko Horvat's The Political Economy of Socialism (Sharpe, 1982). On Mondragon, a recent book by Greg MacLeod, From Mondragon to America: Experiments in Community Economic Development (University College of Cape Breton Press, 1997) is an interesting interpretation written by an activist in co-operative community economic development in the Maritimes. (I met Greg in Mondragon where I was doing some research on worker co-ops and he was leading a group of Canadian students studying the Mondragon and its derivative, the Valencia, model.) For a depressing and entertaining history, origins and abuse of corporations which addresses most of the issues in the main thread see the new 3 hour documentary The Corporation that has won a number of awards at film festivals (including Sundance I believe). Mike Moore, Naomi Klein, Noam Chomsky and Elaine Barnard are featured in the film as well as Milton Friedman and Michael Walker of Canada's ultra-rightwing Fraser Institute. The film was made by a Canadian and has been in general release as a feature film for the past few months. It is particularly interesting in view of the discussion on this thread because it analyzes the corporation as an individual suffering from all the medical symptons of a psychotic personality. By the way, corporations are legally individuals in Canada and thereby their right to free speech is protected by the Charter of Rights in Canada's Constitution. This status was used by the big tobacco companies when they appealed against a law restricting what they could put on their tobacco packaging. If I remember correctly, the tobacco corporations won. So David Shemano is definitely wrong when he says that a corporation does not speak as an individual. Paul Phillips Senior Scholar, Economics, University of Manitoba
Re: Corporations/Side Issue
Paul, for some reason, your messages come to the list with the wrong date, throwing them down lower in my inbox. -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail michael at ecst.csuchico.edu
