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Forum Post: Has collective ownership EVER worked?

Posted 2 years ago on Dec. 28, 2014, 4:30 p.m. EST by TechJunkie (3029) from Miami Beach, FL
This content is user submitted and not an official statement

There are a lot of people here proposing radical economic reforms, like eliminating private business ownership and mandating that companies must be owned by their workers, and the government centrally managing the pay scale of all workers.

Simple question: Has that ever worked in history? Can anybody point to examples of successful, sustained economies based on collective ownership of the means of production?

Counter examples include tragic failures like North Korea's poverty-stricken masses dying of hunger, Cuba's deterioration, the millions who died during China's failed Great Leap Forward, the Cambodians who died during their failed attempt at collectivism, the failure of the Soviet Union, and even the collapse of Argentina and Venezuela's economies that is in progress right now.

30 Comments

30 Comments


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[-] 4 points by flip (7101) 2 years ago

your ignorance is showing once again. compare cuba to honduras or haiti or maybe jamaica and tell me how it looks for average people. i am sure you know that cuba has been under attack by the worlds super power for 60 years while the other countries have had our help and blessing. as for venezeula check out their poverty stats and tell me again how badly they are doing. the other countries you mention have nothing to do with economic systems. and while you are at it how about stacking up the bodies killed under your beloved capitalist system - i will give you a hint - check out india first

[-] 0 points by conservatroll (187) 2 years ago

I am sure YOU jnow that Cuba was the leading country(economically) in the Caribbean and S America before Castro. To say it is better than Haiti or Honduras(countries exporting their poor to our shores) is hardly a ringing endorsement of Castro's Cuba.

[-] 1 points by flip (7101) 2 years ago

no i do not know how cuba did economically under batista. is that really your argument? that it was doing well in the 40's and 50's with the mafia and batista in charge? can't be? should we keep this going - remember the attack by the world's super power - bombing attacks not just the economic embargo. and how about all those other capitalist paradises. those countries benefiting from alliance with the world's super power like salvador and guatamala? just because you are conservative doesn't mean you have to be stupid does it?

[-] 3 points by ShadzSixtySix (1936) 2 years ago

''Cuba in the American Imagination'', by Margaret Kimberley :

Consider : ''Cuba is a nation which has suffered and struggled to be free from domination. It doesn’t matter if it is a psychological after thought for Americans. They may try to pretend that the last fifty years never happened but there is no turning back. People in the United States may have selective amnesia, but surely Cubans do not.''

I did initially reply with this to the 'CON-troll' above - but then realised what an utter waste it would be. A very HNY to you & yours flip & may 2015 bring peace, joy and contentment to you & all .. Cubans et al.

multum in parvo ...

[-] 1 points by flip (7101) 2 years ago

good article - as usual and thanks. hny to you and yours also. we don't cross paths too much here but i always enjoy reading what you put up. thanks again and keep it going!

[-] 2 points by ShadzSixtySix (1936) 2 years ago

"Clinical Psychologist Explains - How Ayn Rand Helped Turn The US Into A Selfish And Greedy Nation", by Bruce E. Levine :

I think that you'll find that interesting. I'm always on your wing or 'watching your six' comrade. Solidarity.

semper fidelis ...

[-] 2 points by flip (7101) 2 years ago

i read that just after i wrote to you. another good one - as for russian jewish women i prefer emma goldman to that wanna be white russian ayn. the whole crew of capitalist "intellectuals" would be a sick joke if they did not do so much damage to the world and those living in it.

[-] 2 points by ShadzSixtySix (1936) 2 years ago

D'you know Ayn Rand's real name ?! And ditto re. Emma Goldman !! Of course !!!

multum in parvo ...

[-] 4 points by flip (7101) 2 years ago

you read too much! you must have too much time on your hands - want to come and take care of my two grandchildren for a few weeks so i can catch up on my reading. they are lots of fun - 7 and 5 - very easy duty - very relaxing! good one on emma and i did look up ayn's real name - crazy world

[-] 5 points by ShadzSixtySix (1936) 2 years ago

"Cooperatives and Community Work Are Part of American DNA", by K. Zeese and M.Flowers :

I've got nephews & nieces aged 2 - 9, so am a well trained 'unc' & you and I do what we do because of the generations to come to our "crazy world" - ergo this article by Zeese & Flowers + per the OP, see :

respice, adspice, prospice ...

[-] 4 points by elf3 (3721) 2 years ago

Collective ownership of government worked before corpirations stole it...we called it democracy.

Also I think we are talking about taking focus off of a work based lifestyle and creating a life sustained by work not work sustained by giving our lives up...there is a great difference there and in general having a work system that values this certainly would not align with our system of feeding ceos and an ownership caste that demands our very existence to sustain a very small percent who get the experience of living outside the demands of a financial system tipped against the majority who toil against themselves in vain. We clean the gears that keep the machine puffing out black smoke that we endlessly scrub...it makes no sense when we don't see the benefits of our labor...only the ownership caste sees the benefits. It is so strange we keep on doing it...it is the definition of insanity to keep doing this over and over and expecting a different result. We can toil for the machine...but the more we do, the less rewards we will see as we help build their power into ever greater heights and functioning that increases their control over our government and us. We are fine tuning and toiling for our demise...or rather more toiling with fewer and fewer benefits. Cost vs pay...pay vs cost. They control both cost and pay and have us chasing our own tails spinning our tires...we aren't ever going to catch the rabbit.

[-] 3 points by ShadzSixtySix (1936) 2 years ago

"We clean the gears that keep the machine puffing out black smoke that we endlessly scrub...it makes no sense when we don't see the benefits of our labor...only the ownership caste sees the benefits. It is so strange we keep on doing it...it is the definition of insanity to keep doing this over and over and expecting a different result. We can toil for the machine...but the more we do, the less rewards we will see as we help build their power into ever greater heights and functioning that increases their control over our government and us. We are fine tuning and toiling for our demise...or rather more toiling with fewer and fewer benefits." = Brilliant & fyi ...

From which .. "The alternative that Thatcher, Reagan and neoliberals could neither imagine nor understand - nor banish - is to move beyond all forms of capitalism. That requires transforming the internal organization of all forms of enterprise so that the workers become the democratic collective that directs the enterprise. On that basis, we can finally and genuinely democratize the economy and society.'' HNY elf to you and yours. May 2015 bring us all joy and prospects for real pro-99% change.

per aspera ad astra ...

[-] 4 points by Shule (2638) 2 years ago

I'm not so sure about that. If one looks at Cuba for example in terms of quality of life and human development, if one looks at the indexes put out by international organizations who track those kinds of things, Cuba is respectably high on the list, actaully highest of all Latin American countries, and considering all the !@#$ the U.S. dishes out against it that is quite an achievement. Cuba did institute a few small reforms, but pretty much remains a dominantly (about 80%) state controlled economy, and is by no means about to collapse in any kind of way. Interestingly enough Cuba's economic system is based on the structure of U.S. based corporations, i.e. Cuba Inc., only that instead of profit, their operating goals are human development and quality of life.

Then there is Libya that had a really good socialist system until the U.S.A. cartel trashed it.

Then we have those Scandinavian countries that everybody always says are about to collapse with all their "socialism" but never do.....

Im no commie, I'm not ready to give my piece of the American pie away to anybody, but we must look at all this honestly.

[-] 3 points by johannus (386) from Newburgh, NY 2 years ago

We may not agree on everything, but it is easy to tell that you understand the gravity of it all, and know that we have to be to open to radical thinking to find the best solutions...

[-] 4 points by agkaiser (1817) from Fredericksburg, TX 2 years ago

The straw man is your own invention:

"There are a lot of people here proposing radical economic reforms, like eliminating private business ownership and mandating that companies must be owned by their workers, and the government centrally managing the pay scale of all workers."

I, for one, don't imagine any such thing. My vision is a world of people who agree that the community is more important than the individuals who wish to control it and the rest of us in order to further self interest. We'll rule by consensus.

In order to achieve the constructive consensus of ideology necessary in such a world, people like you must be convinced to abandon the dark side and join us or . . .

"One way or the other, goodbye brother . . ."

[-] 1 points by TechJunkie (3029) from Miami Beach, FL 2 years ago

You're one of the specific people who I was referring to. On another page, you said this:

What's not needed is aristocrat owned businesses or for profit privately owned finance, energy, medicine, communications or mass transportation. Large enterprizes (that require non family member help) must be employee owned and democratically operated - of, by and for the people.

That idea has been tried a few times in history, so we can look back to see how well it worked. In Communist China, Mao attempted to transform the economy by creating worker collectives. They seized property owned by wealthy people and redistributed it to poor people. The result was that millions of people died when agricultural production plummeted. Mao called it the "Great Leap Forward", but it actually turned out to be a Giant Step Backward.

[-] 3 points by donOld (134) 2 years ago

None of the countries mentioned above ever broke free from the global DEBT-based monetary system. You can't BORROW independence or freedom. Failure is inevitable if you remain dependent upon the existing structures (and ideologies) of capitalism.

China & Russia have never even had "collective ownership". The state owns and controls everything of value and the people have no independent, direct access to any of it. A wealthy elite rule the country there, just as they do here. True collective ownership (or more correctly, non-ownership), built upon equality, with minimal state intervention, has never been tried anywhere on Earth... yet.

[-] -1 points by TechJunkie (3029) from Miami Beach, FL 2 years ago

Your proposals for state intervention have been intrusive. Mandating pay scales through central planning, for example. It's impossible to mandate equality without a lot of state intervention.

The tens of millions of people who died because of state intervention during the Giant Leap Forward in China and in Cambodia and in the famines in North Korea didn't die because of debt or the global money system. They died because of inefficiency in central planning.

[-] 3 points by donOld (134) 2 years ago

@ TJ "It's impossible to mandate equality without a lot of state intervention."... that's simply not true. True equality does not require pay scales of any kind. Equal is the highest value possible. As I said before, I only mentioned the idea of pay scales to see what people here thought of them.

[-] 0 points by TechJunkie (3029) from Miami Beach, FL 2 years ago

How do you plan to impose and maintain equality? By eliminating money entirely?

[-] 2 points by Shule (2638) 2 years ago

Eliminating money? Now that is an idea! And we can start instituting that on a daily basis in our daily lives....and not pay taxes on the things we do.

[-] 2 points by turbocharger (1756) 2 years ago

Personally I hate partnerships in business, not sure how a larger operation would turn out with that many heads involved and decision making power.

Good chance it would resemble Occupy- a lot of discussion, a lot of great ideas, but very little follow through or agreement on it all.

Needless to say that is fine in political organizing (theres no real deadlines, etc) but in biz you are done.

I prefer to just do things myself.

[-] 2 points by flip (7101) 2 years ago

do you know of mondragon in spain

[-] 1 points by turbocharger (1756) 2 years ago

Ya, Ive heard of them. Personally I think they are too large to be effective, but it is a good example of how it can be done.

[-] 2 points by BradB (2693) from Washington, DC 2 years ago

the problem with most people is that they focus on BIG & Single solutions... the world is not built that way....

Meet the Low-Key, Low-Cost Grocery Chain Being Called ‘Walmart’s Worst Nightmare’

Retail analysts say the world’s biggest retailer has reason to fear a small grocery chain that’s based in Idaho and boasts a business model that allows it to undercut Walmart on prices.

So about that eye-catching Walmart quote. Those are the words of Burt Flickinger III, a widely respected supermarket-retailing-industry expert who works for the Strategic Resource Group. Flickinger was quoted in a recent Idaho Statesman story about WinCo, a chain of roughly 100 supermarkets in the western U.S., based in Boise, Idaho.

“WinCo arguably may be the best retailer in the western U.S.,” Flickinger says while touring a WinCo store. “WinCo is really unstoppable at this point,” he goes on. “They’re Walmart’s worst nightmare.”

Flickinger isn’t the only industry insider discussing WinCo and Walmart in the same breath. “While many supermarkets strive to keep within a few percentage points of Walmart stores’ prices, WinCo Foods often undersells the massive discount chain,” the industry publication Supermarket News explained last spring.

http://business.time.com/2013/08/07/meet-the-low-key-low-cost-grocery-chain-being-called-wal-marts-worst-nightmare/

~~~~~~~

WinCo Foods is proud to be employee owned…

We believe our employees should share in the success of our company in a tangible way. That’s why we created an Employee Stock Ownership Plan (“ESOP”) more than 25 years ago. Participating in the ESOP program means employees are part owners of the company and benefit financially from a job well done. In this way, there is direct incentive for employees to work hard and take pride in what they do; that is why our stores are cleaner, our prices lower and our smiles are bigger. Additionally, being employee owned means WinCo Foods is owned by members of the local community.

How our program works:

Each employee owner becomes a participant in this program after:

  1. Working at least 500 hours in the first 6 months of employment
  2. Reaching 19 years of age
  3. Accumulating 1000 hours a year

WinCo’s ESOP never involves contributions from the employees; all contributions are entirely made by the company.

Our ESOP’s Solid Financial Performance:

Unlike a publicly traded stock valued on the open market, the per share value of WinCo’s stock is appraised annually by an independent valuation firm selected by the ESOP trustee. ESOP stock values have averaged increases of 20% compounded annually since 1985. That means an employee who received a company contribution of $5,000 worth of stock in 1985 now has stock worth almost $480,000 from that one year alone!

At WinCo Foods, being an employee owner means having a stable present while building your future. Our employees enjoy industry competitive wages and the long term investment that comes from company ownership.

http://wincofoods.com/about/an-employee-owned-company/

[-] 2 points by TechJunkie (3029) from Miami Beach, FL 2 years ago

That's pretty cool. Thanks, I had never heard of WinCo. But this isn't an example of an economy based on social ownership of the means of production. It's an example of a company with a management layer and a CEO and a founding family that reaps a profit on the backs of the labor of its workers. It might be an example of workers plugging themselves directly into the economy without the help of a company except that it's not -- the founders built the company and then started an employee stock purchase plan.

WinCo is interesting but it's interesting as an alternative business model, not as an alternative structure for an entire economy. There are people here who would like to outlaw WinCo because it's not a collective owned entirely by the workers. It's an anti-union company with a CEO and executives who exploit their labor pool by making six or seven figures per year while the workers make an average of $11 per hour.

[-] 1 points by JPB950 (2254) 2 years ago

There are examples of cooperatives working, workers running their own business. There are no convincing examples of socialism working on a national scale. At least not convincing enough to get support for the changes in law that would be required to take the means of production out of private hands.

[-] 1 points by TechJunkie (3029) from Miami Beach, FL 2 years ago

The founder of this web site recently posted an interesting explanation of why collective ownership of a software company is infeasible:

If your utility function is physical strength, then some people will be able to run a mile in five minutes, others in twenty minutes. If your utility function is IQ, then some will have an IQ of 70, some will have an IQ of 130. So in order to make egalitarianism work for a software company—where intelligence is the only metric we care about—we’ll need to exclude people who fall outside one standard deviation of the software engineer IQ bell curve. We shall define this as 115 <= IQ <= 145, which assumes the mean SWE IQ is 130 and σ=15.

Therefore we’ll need to fire all the janitors and customer service representatives, since they don’t meet the SWE intelligence bar. Now we could technically change our definition of “equality” to simply mean “equal pay”. But then the software engineers would be pissed off that they’re getting paid the same as the janitors. Writing code requires far more training and intelligence than scrubbing toilets. So why should the janitor, who’s unable to write code, be paid the same as the software engineers who can?

Therefore we must force the software engineers to scrub toilets and answer phone calls. There really isn’t any other solution. But this introduces another problem, because software engineers tend to avoid that sort of work like the plague. But thankfully, there’s another really good egalitarian antidote to this problem: distribute the toil equally amongst everyone.

Each engineer would be issued a chore schedule at the beginning of the month. It would regiment their lives by itemising all the things they need to do. Things like: one hour on Thursdays and Fridays cleaning bathrooms; Mondays answering phone calls from customers; Tuesdays and Wednesdays writing code; etc.

Hard labour such as this will also help cleanse them of their bourgeois mindset. The first rule of revolution is to purge all counter-revolutionary tendencies. We can’t have the engineers thinking that such menial chores are beneath them. We must also ensure that, under no circumstances, will our engineers be inclined to delegate their chore duties to the poorer oppressed classes of society (that we fired earlier).

So now we’ve got a hippie egalitarian software company, consisting solely of engineers of roughly equal intelligence, who share the toil of grunt work equally. The unequals have been loosed to a secluded slum so they’ll be of no use to society. The cops will keep the unemployed lumpenproles at bay, for their very sight will engender in us feelings of cognitive dissonance that’d threaten our new reality of mythical equality.

Except now it turns out that our decision to go egalitarian was very bad for business. Getting rid of the janitors and CSRs making $50k/year saved us a lot of money, and software engineers only cost $100k/year which isn’t that much more… Oh but wait, it turns out that if we look at this balance sheet thing, each engineer’s labour created $1,200k/year in profits for the company. [This figure is not an exaggeration. I calculated it using the public financial statements of a large reputable tech company.] Now that they’re spending half their time doing grunt work, profits per engineer has declined to $600k/year. That’s a big dip. So we need to double our engineering staff if we want to sustain our growth trajectory and monetise our assets. We might also need to make compromises on the quality of engineers we recruit in order to fill this void quickly.

But wait, it turns out we’re actually exploiting our engineers because that $500k/year in surplus value extracted from their labour is going to the owners of the company. That’s not very equal, especially since the owners aren’t actually producing software. So to maintain the egalitarian myth, we must become a cooperative and pay each engineer a salary of $600k/year.

Thus, we have communism.

She posted a link to that on Twitter and somebody responded:

I am exploring the opportunity to help create a developer coop

She replied:

I strongly urge you to reconsider. Your biggest obstacle is that geeks don't care about money and organizational politics. Coders tend to be the sorts of people who just want to write code, and have someone else take care of everything else.

She understands that some people just want to work, and not worry about business development. But the idea of eliminating private business ownership and requiring every business to be a co-op owned by its workers would require every worker to care about business development, management, HR, property leases, IT, legal liability, and a lot of other things that workers don't want to worry about.

The inescapable conclusion here is that business owners and management don't simply exploit workers. Both provide a necessary service to the worker. People around here look at a business and conclude that the business is oppressing its workers and stealing the product of their labor, but how many grocery store cashiers want to negotiate leases or compile cost accounting reports?

[-] 3 points by Shule (2638) 2 years ago

I believe most people recognize the role and value of good owners and wise management in business. I personally don't believe that is the problem our society is facing right now; the basic infrastructure is ok. The problem I see is when owners and management conspire to exploit workers not only at the expense of workers, but also at the expense of the company itself and society in general. And then with the existence of Wall Street "shareholders" who demand ever higher revenues taken out of companies like so many parasites, it is only a matter of time before the whole infrastructure collapses. The matter becomes how do we as a society control unscrupulous owners, management, and shareholders?

[-] 0 points by WSmith (2696) from Cornelius, OR 2 years ago

Has monopoly ever worked?