Rothbard suggests the cadre, "however numerous they may be, they are not known to one another; under the tyrant they have lost freedom of action, of speech, and almost of thought; they are alone in their aspiration". But Rothbard's essay is dated 1975, La Boetie wrote his in the 16th Century, and neither had access to a modern wonder called the "Worldwide Web". Whether or not the Internet will eventually prove to be a means of organization amongst the cadre remains to be seen. Meanwhile the Internet seems bloated with an endless critique of "errors committed by the government", summarily dismissed by Rothbard because:
"... much of what the State does is not an error at all from its own point of view, but a means of maximizing its power, influence, and income. We have to realize that we are facing a mighty engine of power and economic exploitation, and therefore that, at the very least, libertarian education of the public must include an exposé of this exploitation, and of the economic interests and intellectual apologists who benefit from State rule. By confining themselves to analysis of alleged intellectual “errors,” opponents of government intervention have rendered themselves ineffective".
I would take Rothbard's observation a step further to argue such confinement also maintains divisions amongst very intelligent people whose energies might be extremely effective in developing an alternative system if they weren't routinely squandered in the incessant critique of externalities that are entirely intractable under Capitalism. In my view, this arrogant and pitiful waste of human resources gives "the left" (whatever that is) a hard-earned and well-deserved bad name -- "ineffective" at best.
So let's turn now to the biggest challenge confronting the cadre in developing a program of attraction rather than promotion. First, let's clarify that any mention of the "cadre" in this discussion refers specifically to 1) people who are already members of worker cooperatives or who are otherwise involved in the cooperative movement, and 2) those who would like to become involved.
While existing worker cooperatives are surprisingly numerous, and they consistently perform at least as well as their capitalist counterparts (often better), worker cooperatives do not tend to expand. [9] This dynamic might seem extremely favorable from an ecological perspective, but it's not at all useful in developing a cooperative movement. The problem is not that worker cooperatives don't exist or that they aren't viable. The problem is that outsiders who enthusiastically want to get involved, don't have ready access to the cooperative movement.
But if democratic firms don't expand, then the alternative is to form more democratic firms. While the nonexpansionary character of worker cooperatives seems desirable for many important reasons, the overall movement must deliberately expand to eventually dominate Capitalism. Otherwise, the "movement" is pointless.
So moving from the abstract toward the concrete, lets assume that conversion of established workplaces from wage-labor to Worker Cooperatives will not be cost-free. Let's further assume the establishment of new worker cooperatives is even more difficult and costly.
Where will the funding come from?
Can we expect the existing financial system (privately-owned banks) to support such a radical idea? Perhaps some will, and some cooperative organizations might have already secured such traditional funding. But lets reasonably assume a complete lack of cooperation from traditional finance. Where can funding be derived for the conversion of existing enterprise to Worker Cooperatives or for the founding of new Worker Cooperatives?
David Schweickart's outline for "Economic Democracy" suggests democratizing investment. In other words, "generate investment funds by taxing enterprises (a flat-rate capital-assets tax is optimal), then return the proceeds to regions on a per-capita basis to be reinvested in the local economy". [9] One attraction to this scenario is it eliminates the whims ("animal spirits"?) of wealthy tyrants ("private investors"?) from the economic system altogether, resulting in far greater economic stability, overall. Another attraction to this approach is that we stop taxing people and start taxing capital, thus bringing capital subordinate to people in a more natural hierarchy of sovereignty, where Nature begets People begets Capital. The latter is my interpretation, not necessarily Schweickart's intent.
But despite the exciting potential in David Schweickart's proposal, this sort of financial system is not yet in place. While his vision for a far more balanced economic system seems infinitely intriguing, what is the best course of transition between "here" and "there"? What is the most viable transition between Capitalism and Economic Democracy?
New organizations like the Grameen Bank and the Common Good Bank promise noble aims in terms of public ownership, democratic approach, community cooperation and regional focus. But the business models of these "banks" are still rooted in fractional reserve and interest with the ultimate aim of making a profit. Considered usury by some critics, this raises at least one objection: Why does any bank need to make a profit? Since banks traditionally don't produce anything but debt, this seems a valid question.
The most important distinction between traditional banks and the Common Good Bank model is shareholder value versus the common good. The ultimate goal of traditional banks is to generate income for a passive group of owners called shareholders. But since Common Good Banks are owned by local depositors, not a small group of corporate shareholders, all proceeds go to the community, hence "the common good". While the Common Good Bank must avoid losing money, the bank itself does not need to make a profit. So, much like worker cooperatives, growth is not an imperative as it is with traditional banks.
Still in the planning stages, however, the Common Good Bank is not yet open for business. All this in mind, a friend of mine offered another suggestion recently, and it's worth serious consideration:
"I think worker cooperatives are a really excellent idea. Of course the currency and exchange problem would still be there; i.e., there would have to be a monetary system, which should properly be controlled by the cooperatives themselves rather than some outside authority. And the availability of money should be backed by production, not financial, values." [10]
From this perspective, we can envisage a truly parallel system of business -- one that deliberately competes with the existing system, growing daily from the inside out, even as the "shell" of the old system crumbles all around us. As Mahatma Ghandi and others have suggested, let's "build a new society in the shell of the old".
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