This is Richard Wolff from Democracy at Work responding to another Ask Prof Wolff question
from our Patreon community. This one comes from 'Phillipe Lavrotti' and 'Phillipe' asks 'how
would inflation, depression, and the other harmful capitalistic economic behaviors we know so well...
how would they be avoided if we had an economy instead based on worker co-ops?' In other words,
how would worker co-ops either fix or avoid these kinds of problems?
There's a wonderful question. And it's in the minds of many people. And for many of them it
blocks getting further into the whole worker co-op idea, because they don't have a ready answer for
it. So I'm going to try, in a very short time, to give the basic answer, with some examples.
The basic answer is that a worker co-op is not driven by profit. A capitalist enterprise has
to be. It is constantly afraid of competition. If there isn't competition happening, they're afraid
it will happen. They have to be prepared for it, they have to fight it because - and this is
crucial - their survival is at stake. If they don't make a good profit they don't have that
money out of the profit to buy a new technology to be able to compete with a competitor, to do well,
to survive. The jump will be gotten by another competitor. And then you will disintegrate, your
business will go out of business. Every capitalist knows it, sees it all around themselves.
So what would happen in a worker co-op? Well, the whole idea is you don't maximize one particular
variable in your business. You have no reason to, for example, do everything to
make the profit higher. In fact, you have a reason not to. Profits go to the owners,
the shareholders, a tiny group of people. The vast majority of you don't get profit.
You get something else. Let's call it wages, let's call it salaries. So to maximize profit,
which is what capitalist enterprises do, disguises a little ugly reality. It's maximizing what is of
interest to a very small number of people: those who get, those who depend on, profit.
But a worker co-op wouldn't work like that. We need some profit to grow and all that. But we're
just as interested in the wages people have to live, in the quality of the work experience
five days a week, eight hours of the day, in the ecological impact of what we do in this workplace,
what it does to nature that we live on and depend on and so on. So the very first basic answer is
you're free of the chains of profit as the ultimate bottom line. And you're open now to
running a business, every business, for lots of benefits going to all the different people
that share in... or our stakeholders, if you like, in the enterprise.
And now some examples, very quick. Guarantee people a job, that's part of now what we're
interested in. It's not the most profitable thing, but that's fine. We could do some
things for profit. And other things to meet another need, namely the need of working
people to have a secure job, working people to have a secure, or at least minimally secure,
income, people to have a say in the job, because that's part of what being a human being is.
All of those things would become objectives of each firm. There would never be a question
of laying off 50 people. That becomes a social problem. If you don't need people
in your workplace then the larger society has to find alternative employment for them, meanwhile
guaranteeing their income. Because that's part of what each firm contributes some money to be able
to do for itself as a community. So I think worker co-ops will show very quickly how vastly superior
they are to slavery or feudalism or capitalism. Because all of those systems were owned, operated,
and run to benefit a minority; in capitalism's case the profit winners, the profit gainers.
But we're not going to do that in a worker co-op. We're going to take care of all the participants.
All of them have a claim. And a democratic procedure to meet those claims is why we
won't have the cycles, the depressions, the inflations, that the other systems suffered from.
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