Posted 5 months ago on July 5, 2013, 9:34 a.m. EST by LeoYo
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Can Union Co-ops Help Save Democracy?
Thursday, 04 July 2013 09:17 By John Clay, Democratic Promise | News Analysis
A new wave of cooperatives is emerging in the US, and a big part of the inspiration is coming from what might seem an unlikely source: the United Steelworkers International Union (USW), which describes itself as North America's largest industrial union, with 1.2 million active and retired members.
In 2009 the USW joined with Mondragon Inc. of Spain and Kent State University's Ohio Employee-Ownership Center (OEOC) to start a discussion on bringing the successful Mondragon model of employee-owned cooperatives to the US. Mondragon was founded in 1956 and today includes some 260 enterprises, many of them cooperatives, in more than forty countries, with annual sales of 24 billion dollars. OEOC brings to the effort 25 years of institutional expertise in the development of employee-owned businesses. The collaboration with the USW was announced in the national media in 2009, and in 2012 the three organizations followed up with the release of a how-to guide called "Sustainable Jobs, Sustainable Communities: The Union Co-op Model."
The core goal of any employee-owned cooperative, a model dating back to the 18th century, is to organize business democratically. The people who do the work jointly run the business, all have a say, one-person one-vote, and all share in the profits. Mondragon has spent decades perfecting the model in Europe, and the addition of collective bargaining through a union committee is a new twist that can bolster democracy and garner additional resources for launching and sustaining cooperatives.
Union partnership with employee-owned co-ops is part of a philosophical ebb and flow within the US labor movement, as the tide turns alternately toward negotiating the status quo of the corporate economy or toward reforming it.
In the 1860s, National Labor Union leader William Sylvis boldly declared "The time has come when we should abandon the whole system of strikes and make cooperation the foundation of our organization and the prime object of all our efforts."
The Knights of Labor made employee-owned co-ops a priority in the 1870s, and union leader Terrence Powderly later wrote "My belief that cooperation shall one day take the place of the wage system remains unshaken."
Proponents of today's union co-ops may not be seeking to overthrow the wage system, but they do believe the model will help people to create more employee-owned co-ops, and more profoundly democratic ones. And they promote union co-ops as a solution to several deficiencies of the US workplace at the micro level of the single company: lack of democracy, wage disparity between highest- and lowest-paid employees, and job insecurity.
Some also hope these micro-level solutions might someday transform the US political economy at the macro level, helping solve problems like the growing wealth disparity between the 1 percent and the 99 percent and its strain on democracy, stagnant for the US workforce, and the community instability and drag on net job growth caused by downsizing and by off-shoring of jobs.
The prospects for these micro and macro goals are worth examining more closely. But first, just what is the Union-Co-op initiative?
The union co-op initiative
The first thing to understand is that the initiative is not a centrally-directed program one just plugs into. There is no central hub. The initiative is better understood as an agreement among the USW, Mondragon, and OEOC to develop and share out a model which strengthens the traditional employee-owned cooperative through a new partnership with labor unions. And, in equal share, the initiative consists in the response of interested workers, business owners, unions, non-profits, and local communities who have heard of the model and are now talking with each other, and with the USW, Mondragon, and OEOC, about starting new co-ops.
"The response to the initial press release in 2009 was overwhelming," says Rob Witherell of the USW, "and people keep coming to us to learn more."
The "Union Co-op Model" how-to guide (available at www.usw.org/our_union/co-ops) explains the Mondragon model and how the union co-op improves on it. It lays out the vision and principles that are the moral foundation for the model and also describes the mechanics of governance, ownership, financing, compensation, and collective bargaining. There are even a couple of short case studies. Even as thorough as the document is, it is a guide, not an instruction manual, and there are many specifics which, as Chris Cooper of OEOC explains, "employee-owners will have to decide for themselves."
And employee-owners are doing just that. The Cincinnati Union Cooperative Initiative (CUCI) and local partners are already putting the union co-op model into practice. A local food growing, distribution, and retail cooperative called Our Harvest, whose workers are organized by the United Food and Commercial Workers Union, was launched in 2012 and is preparing to expand. CUCI is now helping lay the groundwork for another union co-op, organized by the Greater Cincinnati Building and Construction Trade Council, to improve the energy-efficiency of aging commercial buildings. There is also a project to recruit a Mondragon cooperative, the Danobat Group, to open a union co-op railway manufacturing plant in Cincinnati organized by the USW.
"Today there are projects underway in Cleveland, Cincinnati, Pittsburgh, New York, Seattle, Denver, and new ones starting all the time," says Michael Peck of Mondragon USA.
Some employee-owned cooperatives which developed independently of the union co-op model have nonetheless helped inform the new model. A few recent examples:
The Evergreen Cooperatives in Cleveland, Ohio are not organized as union co-ops but are demonstrating the viability of the Mondragon model in the US. Evergreen currently operates three employee-owned enterprises: Evergreen Energy Solutions, started in 2008, installs solar panels and provides energy efficiency services; Evergreen Cooperative Laundry, started in 2009, is an industrial laundry serving institutional customers; and Green City Growers Cooperative, started in 2013, is an urban organic farm.
In New York City, Cooperative Home Care Associates evolved gradually into a union-organized cooperative. Launched as an employee-owned cooperative in 1986, CHCA invited the Service Employees International Union to organize its worker-owners in 2003, and finally established a labor-management council in 2007 which, though not identical to the union committee of the union co-op model, can be seen as a precursor.