Can a worker owned and managed economy work?

[Craig B]

No it isn't capitalism, it's a lemonade stand. People have been doing the equivalent of lemonade stands for ages, capitalism has only been around for a couple of centuries. Just because lemonade stands can exist under capitalism doesn't mean they have anything to do with capitalism as such, they can exist under many other economic systems as well.

That's like saying "planting a tree is capitalism" because people can plant trees under capitalism.

Do you not see that is the very point I am trying to make?

We have to distinguish between particular capitalist activity on one hand, and capitalist state economic systems on the other. Private ownership of means of production may be defined as capitalism, but it existed long before the economy of any country came to be dominated by capitalist relations. We know this, because old records tell us so. Money has existed for two and a half millennia, and privately owned roadside kiosks selling drinks for probably as long.

A single copper coin in mediaeval feudal Japan was the price of a cup of tea from a roadside vendor, I have read somewhere. Probably the vendor owned the stall, but the big feudal magnates owned the state.

Capitalism existed within societies long before the economies became predominantly capitalist. In the same way, as I have stated, mutualism and state owned enterprises exist within capitalist economies.

Small unobtrusive mammals were around in the days of the dinosaurs, but the "Age of Mammals" began only when a catastrophe removed these larger and previously more prominent species.

 

[caveman1917]

We have to distinguish between particular capitalist activity on one hand, and capitalist state economic systems on the other.

It isn't particular capitalist activity.

Private ownership of means of production may be defined as capitalism

It isn't. I just gave you the three requirements, private ownership of the means of production is only one of them. And even then the lemonade stand isn't an example exclusive to private ownership of the means of production - see the link I gave you on mutualism, as one example.

Capitalism existed within societies long before the economies became predominantly capitalist.

Yes, very true. However roadside stands ain't examples of it. An example would be something like this (ETA better article here).

 

[Craig B]

It isn't particular capitalist activity.



It isn't. I just gave you the three requirements, private ownership of the means of production is only one of them. And even then the lemonade stand isn't an example exclusive to private ownership of the means of production - see the link I gave you on mutualism, as one example.

Who said it had to be exclusive? In the USSR roadside stalls were common, but they were often owned by the state. In other countries they may well be owned by individuals.

Yes, very true. However roadside stands ain't examples of it. An example would be something like this (ETA better article here).

If you are saying that the building of pyramids (built on orders of the state, and intended for the non-commercial purpose of ceremonial disposal of the body of the deceased head of state) was a capitalist enterprise because it is recorded that on occasion workers employed on it went on strike; but a privately owned retail outlet isn't capitalist because its self employed owner doesn't go on strike, then you have a definition of capitalism and of the state that I have nothing in common with, and am therefore unable to discuss with you.

 

[caveman1917]

Who said it had to be exclusive?

What good is it if it doesn't have to be exclusive? Then you might as well just go "planting a tree is capitalism."

If you are saying that the building of pyramids (built on orders of the state, and intended for the non-commercial purpose of ceremonial disposal of the body of the deceased head of state) was a capitalist enterprise because it is recorded that on occasion workers employed on it went on strike; but a privately owned retail outlet isn't capitalist because its self employed owner doesn't go on strike, then you have a definition of capitalism and of the state that I have nothing in common with, and am therefore unable to discuss with you.

One of them having wage labour and the other not. You'd almost think that wage labour is a necessary condition...oh wait!

 

[Craig B]

What good is it if it doesn't have to be exclusive? Then you might as well just go "planting a tree is capitalism."



One of them having wage labour and the other not. You'd almost think that wage labour is a necessary condition...oh wait!

Is it a sufficient condition? If wages are paid by a priest to people to create a tomb, does that make the tomb a capitalist enterprise?

Planing a tree because you intend to sell the wood at a later date is capitalist. Planting it because it's pretty in your garden is an aesthetic non-economic enterprise. Planting trees, as was once done as a military undertaking for the future construction of warships, not to make a profit, is something else again. Planting a tree because the Goddess of the Forest visited you in a dream and commanded you to do it isn't capitalist either, in my book.

The tree planting is common to all these sorts of activity, but it has to be examined for its funding and motive before it can be defined as capitalist or not.

 

[caveman1917]

Is it a sufficient condition? If wages are paid by a priest to people to create a tomb, does that make the tomb a capitalist enterprise?

It's not a sufficient condition, but it is a necessary one.

Planing a tree because you intend to sell the wood at a later date is capitalist.

No it isn't, paying someone 500$ to plant a tree which you then sell for 1000$, and pocketing the difference, is capitalist. No wage labour, no capitalism. Capitalism is not the same as any generic market economy, again look at mutualism, or market socialism for that matter.

 

[Craig B]

It's not a sufficient condition, but it is a necessary one.



No it isn't, paying someone 500$ to plant a tree which you then sell for 1000$, and pocketing the difference, is capitalist. No wage labour, no capitalism. Capitalism is not the same as any generic market economy, again look at mutualism, or market socialism for that matter.

That's what I'm saying,

Planting a tree because you intend to sell the wood at a later date is capitalist.​

But suppose I buy a seedling for $500, intending to sell the wood for $1000 at a future date, but I don't employ any other person's labour - I do the work myself. Is the enterprise now not capitalist? I think it's still capitalism: investment for purposes of greater monetary return later. But if I plant the tree because I believe that a god has commanded me do it, and I employ paid labourers to do the work - does that make the enterprise a capitalist one? I think it doesn't.

I believe that you are mixing up two different concepts: the Labour Theory of Value, and Capitalism. They are not always the same thing. If Labour creates value, it does so in any kind of productive environment, whether capitalist or not.

 

[caveman1917]

That's what I'm saying,

Planting a tree because you intend to sell the wood at a later date is capitalist.​

No it is not.

But suppose I buy a seedling for $500, intending to sell the wood for $1000 at a future date, but I don't employ any other person's labour - I do the work myself. Is the enterprise now not capitalist? I think it's still capitalism: investment for purposes of greater monetary return later.

Is mutualism capitalism?

I believe that you are mixing up two different concepts: the Labour Theory of Value, and Capitalism. They are not always the same thing. If Labour creates value, it does so in any kind of productive environment, whether capitalist or not.

Of course it does, but that doesn't stop wage labour from being a necessary condition for capitalism.

 

[psionl0]

No it isn't capitalism, it's a lemonade stand. People have been doing the equivalent of lemonade stands for ages, capitalism has only been around for a couple of centuries. Just because lemonade stands can exist under capitalism doesn't mean they have anything to do with capitalism as such, they can exist under many other economic systems as well.

That's like saying "planting a tree is capitalism" because people can plant trees under capitalism.

Why is the "correct" definition of capitalism so important in this thread? The question is about whether worker owned and managed businesses can work.

There must be plenty of examples of business partners who each work in the business and subsequently incorporating so individual companies can be worker owned and managed. Whether a company with many unrelated employees can successfully be 100% worker owned and managed is a little more doubtful. Evidence of large worker co-ops seem to be a little thin on the ground.

None of this is to say that offering employees shares in a company to build up loyalty is a bad idea. But suggesting that a pizza shop owner would have to turn over their business to the staff is ridiculous.

 

[Craig B]

Why is the "correct" definition of capitalism so important in this thread? The question is about whether worker owned and managed businesses can work.

Your second sentence answers your first. Can a "worker owned" business be described as "capitalist" or not? If not, then what is the criterion of ownership of a worker owned business, and what rights does the individual worker-owner acquire by being taken on as an employee there? Your next sentence doesn't resolve the problem

There must be plenty of examples of business partners who each work in the business and subsequently incorporating so individual companies can be worker owned and managed. Whether a company with many unrelated employees can successfully be 100% worker owned and managed is a little more doubtful. Evidence of large worker co-ops seem to be a little thin on the ground.

But they become owners by individually incorporating, and it is in this capacity, whether they were ever workers or not, that they control the equity and activity of the enterprise.

None of this is to say that offering employees shares in a company to build up loyalty is a bad idea. But suggesting that a pizza shop owner would have to turn over their business to the staff is ridiculous.

I agree. That is the "lemonade stand" issue already discussed. But what if the pizza shop was part of a chain, as many are, with hundreds or thousands of employees. In what way would that affect the issue of worker ownership? To decide that, we need to have a definition of the form of capitalist ownership that currently applies to the individual pizza shop and its employees within the broader context.

The problem of deciding what is meant by worker ownership may in fact be insoluble. It was an issue in the first months of the Bolshevik Revolution, but it proved impossible to apply in practice and was soon abandoned in favour of centralised management and either state ownership or cooperative owners under one arrangement or another.

The long term Soviet solution was, in effect, universal state ownership, with an exception for market stalls where peasants sold the produce of the garden plots they were permitted to retain for their own use, as workers in collective farms.

 

[Dr. Keith]

My daughter works for a chain. I asked her if she thought the company was well run and something she should invest in. She said no. Therein she decided not to be a part of ownership. If she had said yes she could have bought stock int he company and become part of ownership.

Why shouldn't she have the choice?

 

[Craig B]

My daughter works for a chain. I asked her if she thought the company was well run and something she should invest in. She said no. Therein she decided not to be a part of ownership. If she had said yes she could have bought stock int he company and become part of ownership.

Why shouldn't she have the choice?

Of course, she does have the choice, if she has enough spare cash. As you rightly say, she can buy equity in the chain. That however isn't workers' ownership; it's shareholders' ownership, because she could buy the shares even if she had never been employed by that company, and her rights as an owner would derive from her shareholding, not her record of employment.

The only thing is, she may have more knowledge of the company because she worked there, but you can get knowledge of companies, or at least form opinions about them, by reading the reports in the financial pages of the newspapers.

 

[Dr. Keith]

Of course, she does have the choice, if she has enough spare cash. As you rightly say, she can buy equity in the chain. That however isn't workers' ownership; it's shareholders' ownership, because she could buy the shares even if she had never been employed by that company, and her rights as an owner would derive from her shareholding, not her record of employment.

And if the company had employee ownership her right to shareholder ownership would be diminished or removed?

 

[Craig B]

And if the company had employee ownership her right to shareholder ownership would be diminished or removed?

That's the sort of question that shows why it is so necessary to have a definition of what "worker-owned" means.

Here's another puzzle. Suppose she worked for a private partnership and not a publicly-quoted company. Then she wouldn't have the choice to buy shares, even if she had the money to spare, which many people don't.

 

[Dr. Keith]

That's the sort of question that shows why it is so necessary to have a definition of what "worker-owned" means.

Indeed.

Here's another puzzle. Suppose she worked for a private partnership and not a publicly-quoted company. Then she wouldn't have the choice to buy shares, even if she had the money to spare, which many people don't.

She could negotiate for ownership. But it would be up to the owners to decide if they would want her to an owner. She would also be leaving some salary or bonus on the table. I've done this in past jobs where the cash wasn't available for bonuses. (Hint: if there is no cash available for bonuses, options aren't likely to be worth much down the road.)

 

[Craig B]

... capitalism has only been around for a couple of centuries.

That is simply not true. It evolved as an economic relationship many centuries earlier, at a time when the dominant economies of the state were feudal. By common consent, some of its features appeared in Bruges as early as the twelfth or thirteenth century, and emerged also in Venice and other Italian mercantile republics a little later. This economic system finally acceded to political power and dominance in large states a couple of centuries ago, but it existed in several localities long before that. Wiki relates that

A common misbelief ... is that, in late 13th-century Bruges, commodity traders gathered inside the house of a man called Van der Beurze, and in 1409 they became the "Brugse Beurse", institutionalizing what had been, until then, an informal meeting, but actually, the family Van der Beurze had a building in Antwerp where those gatherings occurred; the Van der Beurze had Antwerp, as most of the merchants of that period, as their primary place for trading. The idea quickly spread around Flanders and neighboring countries and "Beurzen" soon opened in Ghent and Rotterdam.

In the middle of the 13th century, Venetian bankers began to trade in government securities. In 1351 the Venetian government outlawed spreading rumors intended to lower the price of government funds. Bankers in Pisa, Verona, Genoa and Florence also began trading in government securities during the 14th century. This was only possible because these were independent city-states not ruled by a duke but a council of influential citizens. Italian companies were also the first to issue shares. Companies in England and the Low Countries followed in the 16th century.​

These "influential citizens", the bourgeoisie or city dwellers, took over the big state machines "a couple of centuries" ago, and in some cases the "dukes" like Charles I and Louis XVI lost their heads as a consequence. And the councils of influential citizens, which had already become influential in the "Commons" or "Third Estate" of the mediaeval social and parliamentary structures, turned themselves into the ruling group and reduced the monarchy, the Church and the nobility to a lesser status, or abolished them altogether.

In the same way, if an economic system of worker owned enterprises is ever to be capable of becoming the main mode of ownership of the means of production in the state, perhaps it should first be able to prove itself as an effective economic format in individual enterprises and sectors of the economy before it achieves general dominance. Is this happening?

 

[Tippit]

@Tippit

1 Who, specifically, are "the elites that run the central bank scams"?

I gave you a name in my post. Then there is also Jacob Rothschild, and his family:

https://www.youtube.com/watch?v=sIA4EkvpLtc&t

https://www.youtube.com/watch?v=5rtRL0vvUBQ&t=12s

There is a lot of evidence that the so-called Richest men in the world (Warren Buffet, Jeff Bezos, Carlos Slim, et al) aren't even close. For instance, there was a Forbes article claiming that former Egyptian dictator Hosni Mubarak was worth $800 billion after looting his country for decades.

If you look at estimated valuations of Saudi Aramco, the world's largest and most highly valued petroleum company, they run from $2 trillion to much higher (if you compare their proven and probable reserves with publicaly traded oil companies). That company is ostensibly controlled by King Salman, who is himself just a puppet of whoever controls the petrodollar system and the US Military.

So if the so-called richest men in the world really aren't, then who are, and why is in their interests to maintain low profiles? Perhaps they have an agenda that they don't want public.

2 in the absence of central banks, I suppose money would have to consist of precious metals. Is that so? Or if not, what would it be?

That is what I would prefer, but that wouldn't work considering the same elites I mentioned have already bought up all of the precious metals and now suppress their price. They would first have to be brought to justice for their multi-generational crimes, and then the metals forfeited and made available for public use.

In lieu of that, any type of money that is strictly limited in supply, and thus, invulnerable to human nature, could theoretically work. Even abolishing the Federal Reserve and allowing the US Treasury to issue credit-based fiat money would essentially put an end to the current scam.

I suppose this is true, that Capitalism is "the right to open your own lemonade stand and sell lemonade, or employ others who may not want to take that risk" but a capitalist economic system is more than that. It is one in which private interests - not necessarily those of sole-trading lemonade vendors - dominate the politics of the state. Religion is no more than belief in the supernatural, but theocracy is something more. Every state employs officials, but the bureaucratic ruling group in the former USSR defined the political system in that country.

After a considerable amount of thought on the matter, I've come to the conclusion that fiat money supersedes all political and economic systems. The ability to issue fiat money ad infinitum entails the ability to set a floor on *any* price, and acquire *any* asset in perpetuity. It renders any fair or equitable notion of "ownership" or "equity" moot, and thus completely undermines capitalism (the private ownership of the means of production), or any other politico-economic system. In short, fiat money is antithetical and exclusive to any fair or just economic system at all, anywhere.

An "employment arrangement" may be voluntary without being fair, if it involves on one hand an employee who must work or starve on one side, and a multinational conglomerate (rather than a sole-trading lemonade vendor) on the other, with the message, take it or leave it. If you quit your job there's plenty more out there desperate to take your place.

I agree with this. An oligopsonistic labor market is neither voluntary nor fair, although it's hard to argue that these are the conditions everywhere in the world. Certainly capitalism is not without its flaws, the ability for capital to exploit political regimes which don't recognize basic human rights being perhaps the biggest. But once again I point most of the blame for the suppression of labor prices on the money system, not capitalism. Capitalism is just a popular scapegoat for the ignorant.

 

[The Central Scrutinizer]

The elites who run the central bank scams are the same ones sponsoring socialism and communism - they're ideological trojan horses. It was John D. Rockefeller who originally said "Competition is a sin." They would quickly abolish capitalism if they could get away with it, now that they're on top. What we need is a functioning justice system, and the abolition of specific institutions that are literally enabling the world to be stolen as described by the quote in my signature.

 

[The Central Scrutinizer]

@Tippit

1 Who, specifically, are "the elites that run the central bank scams"?

The Jews, of course. Who else would it be?

 

[Dr. Keith]

The Jews, of course. Who else would it be?

I hear the Asians are good with numbers.

Ah, who am I kidding, its the Jews.