This story is at least six months old, but Betsy Bowman and Bob Stone had an article
in Dollars & Sense
last year about the growth of "cooperatives"—worker-owned businesses—in Venezuela. So far, over 108,000 co-ops representing 1.5 million members have registered with the state. Most of them are small, set up through government loans, but here's how the larger ones are set up:
Since January 2005... MINEP has stood ready to help workers take control of some large factories facing bankruptcy. ... In one instance, owners of a shuttered Heinz tomato processing plant in Monagas state offered to sell it to the government for $600,000. After factoring in back wages, taxes, and an outstanding mortgage, the two sides reached an amicable agreement to sell the plant to the workers for $260,000, with preferential loans provided by the government.
In a more typically confrontational example, displaced workers first occupied a sugar refinery in Cumanacoa and restarted it on their own. The federal government then expropriated the property and turned it over to cooperatives of the plant's workers. The owners' property rights were respected inasmuch as the government loaned the workers the money for the purchase, though the price was well below what the owners had claimed. Such expropriated factories are then often run by elected representatives of workers alongside of government appointees.
So it doesn't seem
like the government is just seizing existing factories willy-nilly and handing them over to workers—mostly just the ones about to close or go bankrupt, which amounts to a mere 700 so far. (Of course, if workers in healthy firms ever decided to lobby to "cooperatize" their
employers, that would certainly create controversy.) Some co-ops, meanwhile, are required to set aside a part of their profits to fund health, education, and housing for the local population, although this bit is unclear.
Anyway, it's an interesting sidenote to James Surowiecki's New Yorker column
this week about how Chavez's government isn't really all that radical. There are a few lefty ideas being put into practice. I was curious, though, as to how many worker-owned firms there were in the United States. Back in May, the New York Times ran a story
on Reflexite, which is owned by its 500 employees and seems to do well. "Employees who own a big share of their company," the Times
reports, "are more likely to innovate, stay focused on quality and hold management accountable."
More common are ESOP firms, described by Gar Alperovitz in America Beyond Capitalism
. Various bits of legislation since 1974 gave tax incentives to companies that contribute stock to an employee trust, known as an Employee Stock Ownership Plan. In some companies, workers own virtually all of the stock, and hence, the whole company—as with Gore-Tex, which has 6,000 employees and generally wins plaudits
as being a great place to work. All told, about 3,000
of the 11,000 ESOP firms in the country are majority-owned by workers.
Now only about 40 percent
of these companies give full voting rights to their worker shareholders, but even so, one 1998 survey
found that median hourly pay at ESOP firms was 4 to 18 percent higher than pay for comparable work at other firms. Early studies suggest that combining worker ownership with employee participation actually boosts productivity. And the concept has been backed by everyone from William Greider to William F. Buckley. Several state programs, such as the Ohio Employee Ownership Center
, already do what the Ministry of Popular Economy in Venezuela does—provide support for worker ownership—on a smaller scale.
Anyway, this is a sort of rambling post with no real point. I'd be interested in a more direct comparison between worker-owned firms and cooperatives in, say, Venezuela. For one, I imagine ESOP firms aren't nearly as democratic, seeing as how higher-salaried workers will likely earn more stock and hence, have more voting power (it's not clear how power is split in Venezuelan co-ops). And I'd be interested to know more about Bowman and Stone's claim that cooperatives have helped lower the unemployment rate in Venezuela. To what extent? And yes, before it comes up, I know Chavez's human rights record is less than sterling
, but that seems rather irrelevant to this issue, at least.