# An alternative way of looking at industry



## Pesky Wesky (May 10, 2009)

On this thread I posted about The Mondragon Corporation which is the tenth largest corporation in Spain and is run as a cooperative
http://www.expatforum.com/expats/sp...17-promote-spanish-products-2.html#post757364
Well, it seems that all is going well there 



> ...given the performance of Spanish capitalism these days – 25% unemployment, a broken banking system, and government-imposed austerity (as if there were no alternative to that either) – MC seems a welcome oasis in a capitalist desert.


Read the latest article here
Yes, there is an alternative to capitalism: Mondragon shows the way | Richard Wolff | Comment is free | guardian.co.uk


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## 90199 (Mar 21, 2010)

Something like East Germany? remember Wartburg motor cars and Kleber tyres?

However the Orbea cycles are rather special.


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## Alcalaina (Aug 6, 2010)

And before someone dismisses the article because it appears in The Guardian, here is one from The Economist.

Co-operatives: All in this together | The Economist


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## Alcalaina (Aug 6, 2010)

Hepa said:


> Something like East Germany? remember Wartburg motor cars and Kleber tyres?
> 
> However the Orbea cycles are rather special.


Not at all. It includes the supermarket chain Eroski, and white goods manufacturer Fagor.


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## 90199 (Mar 21, 2010)

Alcalaina said:


> Not at all. It includes the supermarket chain Eroski, and white goods manufacturer Fagor.


Never heard of them, cannot be famous like Wartburg.


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## Pesky Wesky (May 10, 2009)

Hepa said:


> Never heard of them, cannot be famous like Wartburg.


Who???


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## 90199 (Mar 21, 2010)

We have agricultural Co-operatives here, mainly for the production and export of cheese, wine, bananas and pineapples.

The cheese factory has an incredible aroma of unwashed feet. 

They also have a store were one can purchase tools, working clothes, fertilizers, potting composts and chemicals etc.


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## mrypg9 (Apr 26, 2008)

Whether a co-operative works well or not is not a matter of ideology but management.
Given good management with clear direction, fair remuneration and employee involvement there is absolutely no reason why a co-operative should not work.

It is of course a capitalist institution....it has to make a profit but its shareholders aren't faceless investors. But then capitalism comes in many varieties from PYMEs to global corporations to the corner shop.

There is a world of difference between a co-operative and a collective. I can't think of a single collective that succeeded. Commercial decisions have to be taken in a business-like manner and collectives were too amorphous and ideologically motivated to be efficient in the competitive modern economy.

The idea of a workers' ownership within a mixed economy is a very old one. The Co-operative Party was until the late 1970s an influential voice in the Labour Party - I was a member.
My ex-husband was very involved in setting up co-operative housing schemes. 

Successful co-ops can be found in most countries and as I said their success or failure will depend entirely on the quality of management, just like any other business.

Wartburg and other such Soviet-era institutions weren't co-operatives. Their workers had no stake in their success or failure and very little say over their pay, conditions and other management issues.
They failed because they existed in a centrally-planned command economy and were doomed to fail as without market pricing to ensure resource allocation there was no information to enable co-ordination of supply and demand.


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## mrypg9 (Apr 26, 2008)

Pesky Wesky said:


> Who???



You've never heard of Wartburg?? It was an East German -made car that resembled any western-produced car of its time like a Spitfire resembles an F1-11. 
It usually came in three or four sludge-like colours and emitted toxic exhaust fumes. It was extremely unreliable and compared to workers' incomes expensive but there was a long waiting list for them.

A friend in Prague had one, very ancient but still crawling along, the 'Isabella' model.

Not sure but I think the same factory produced the famous Trabant.


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## 90199 (Mar 21, 2010)

You forgot to mention, it was a two stroke and could only be likened to driving a wet sponge.


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## Pesky Wesky (May 10, 2009)

mrypg9 said:


> Whether a co-operative works well or not is not a matter of ideology but management.
> Given good management with clear direction, fair remuneration and employee involvement there is absolutely no reason why a co-operative should not work.


Of course, and it could be said that one of the main reasons businesses are not successful is because of bad management. The idea is that as the co op mangement is elected, is not allowed absolute control, and as there is a salary limit in the rules preventing the fat cats getting fatter that a coop is perhaps a "more equal" environment and maybe, in these times more likely to survive.


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## mrypg9 (Apr 26, 2008)

Pesky Wesky said:


> Of course, and it could be said that one of the main reasons businesses are not successful is because of bad management. The idea is that as the co op mangement is elected, is not allowed absolute control, and as there is a salary limit in the rules preventing the fat cats getting fatter that a coop is perhaps a "more equal" environment and maybe, in these times more likely to survive.


Totally agree. I think all industry should have more worker participation. 

The way the co-ops I've been involved with in the UK is that the managers are professionals but the Annual Meeting has more powers than a 'normal' shareholders meeting.

We offered our workers shares in our business but they weren't interested. So we gave our General Manager and his son the Workshop Manager 12.5% each and made them Directors.

They didn't run the company well after we left, though.


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## jimenato (Nov 21, 2009)

Is this anything like John Lewis/Waitrose?


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## dunmovin (Dec 19, 2008)

Hepa said:


> Never heard of them, cannot be famous like Wartburg.


Wartburg Knight... three cylinder, two stroke engine,which polluted more than 5 citreon 2cv s and one trabansk combined, made a Lada riva look good (and that was a car you didn't drive but fought with) and was about as reliable as the claim the Titanic was unsinkable?

That Wartburg?


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## 90199 (Mar 21, 2010)

dunmovin said:


> Wartburg Knight... three cylinder, two stroke engine,which polluted more than 5 citreon 2cv s and one trabansk combined, made a Lada riva look good (and that was a car you didn't drive but fought with) and was about as reliable as the claim the Titanic was unsinkable?
> 
> That Wartburg?


That is the one!!


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## mrypg9 (Apr 26, 2008)

Hepa said:


> That is the one!!


And very much sought-after in the German Democratic Republic and Czechoslovakia.

There was also a Romanian car...Oldcit, inevitably known as old s**t. Made by Dacia?? 

Equally dire.


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## Alcalaina (Aug 6, 2010)

Pesky Wesky said:


> Of course, and it could be said that one of the main reasons businesses are not successful is because of bad management. The idea is that as the co op mangement is elected, is not allowed absolute control, and as there is a salary limit in the rules preventing the fat cats getting fatter that a coop is perhaps a "more equal" environment and maybe, in these times more likely to survive.


Here's a nice short video on how it works:

SHIFT CHANGE - Putting Democracy to Work - preview on Vimeo

I like Mondragón's policy that the highest paid executives can't earn more than eight times what the lowest-paid staff earn. (This ratio varies, in some companies it's even lower.)

They are not confined to Spain:



> Mondragon has struck a deal with the United Steelworkers and the Ohio Employee Ownership Center. Together, they will build yet another variation, a “union-cooperative,” merging the tenets of worker-owned cooperatives, such as democratized workplaces, with collective bargaining."


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## juanillo (Nov 2, 2012)

Can you give any more specific information as to the difference between co-operatives and collectives? I'm studying this concept so I can make an informed decision to migrate to a co-operative in the Mondragon community.


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## juanillo (Nov 2, 2012)

can you point to a website that may give me more information about joining a mondragon cooperative? I would be moving from Fort Worth Tx


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