this post was submitted on 14 Sep 2023
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A worker cooperative is just another business, albeit one where ownership is distributed among the workers. It still functions within the capitalist system and must follow its dictates. They start with capital, employ wage laborers, and must create profit to survive.
I mention this because really your question might as well be, "well why don't people just start more businesses to make more people employed?" The answer applies to co-ops as well: because unemployment is controlled by making it more costly to do business, forcing a need to cut costs (usually starting with labor) and often simply failed businesses. Co-ops are not free from this, they need capital to survive just like a capitalist-owned business.
The only way to free ourselves from this system is to expropriate control of the businesses and put it into workers' hands, which necessarily happens under the same conditions under which we could eliminate artificial unemployment (control of the state).
Put another way, we need to control the means of production, not be minor players still at the whims of capital.
Edit: I should probably mention that there's more to it than this but it requires getting into the weeds of Marxist theory.
Thanks for your detailed answer.
I wouldn't call it capitalism but markets. How can you escape markets, even if you control a state? Some people argue that the soviet union broke due to low oil prices.
Have you considered that coops need less capital to survive? When doing business becomes costly, coops could be the only businesses that survive. They could then keep unemployment rates ar zero while making profits.
Markets don't really mean anything nowadays outside the context of capitalism. It's a place you sell commodities and where there is a presumption of competition. Where does competition come from when production is not capital-driven (and then profit-driven)? The capital valorization process is still there and therefore the slew of horrors forcing humans to destroy each other so there can be 7 brands of blood diamonds.
Socialists have different perspectives on markets after there has been a socialist-won revolution. All of us know they are imbued with capitalist relations, the question is about how they might be used transitionally.
You can skip markets through nationalization, for example. A nationalized power grid operates better and more cheaply than those that operate as markets, for example. Or running a transit system. Maybe nobody needs 7 brands of bland diced tomatoes. That kind of thing.
The Soviet Union broke due to constant and merciless capitalist violence. Everything else is just responses in that constellation, like failing to sufficiently oppose that violence. A simple example is the decimation of the Soviet population by the invading fascists - the genocidal capitalists that were gladly supported by other capitalist nations so long as they thought they would destroy the Soviet Union. This hollowed out the conveyer belt of competent political actors and is why Kryschev came to power and was able to maintain it for his wing of revisionists (possibly the only time you'll hear me use that term unironically).
Co-ops would likely need more capital to survive, as they'll be less preemptively brutal towards their workers (themselves). This means lower rates of profit, requiring a larger scale of operation. Co-ops are often driven out of business by capitalist competition, where the organization of production is forcefully focused onto increasing profits by reducing what is paid for inputs: tools, materials, and labor. Co-ops are forced to operate in the same market and therefore risk going out of business when a competitor undercuts them in prices by 50%. This is one of the reasons that China forces the creation and maintenance of several worker co-ops and is careful about unions. They want those businesses to succeed and export, as China's strategy is to accept most forms of capitalist exploitation in order to draw productive capacity into its borders. They know that co-ops generally need help to survive.
Competition is inherent to our existence. Not everybody can have a house of gold or even live on the coast. How do you allocate scarce resources? Competition is everywhere.
Nationalizing supplies only hides the true prices and will create a grey market for undervalued goods. Problem is that most goods will be overvalued because, as you write, only capitalists are incentiviced to reduce costs.
No leadership can overcome the misalignment of incentives. The sovjet union could have had better leaders but which resources can they use if managers don't dare to cut costs?
Coops can be more competitive when workers understand that they are not only compensated with money to consume but also influence. At least the unemployed should be willing to participate.
If workers cannot be motivated to support coops, how can socialism be sustained?
Competition is far from the only way to allocate scarce resources. If you make one box of mac and cheese, do you make your kids fight over who gets what share?
Fuck off tankie
How do you create close bonds between strangers that other ways become possible?
...what? I don't know what you're getting at.
There is a bond within family that makes sharing food possible. There is distrust between strangers so that sharing is not usual. Generally people don't share food at work.
What is needed to establish sharing as the primary way to resolve conflicts?
People share food all the time at work -- if there's a cake at an office party, you don't fight over who gets what. People share more important things at work, too, like a saw at a construction site or a printer in an office. Competion has its uses, but it's often destructive and wasteful.
Can those examples be generalized on how to handle resource conflicts?
Why not just say what you mean?
Cake is a present where everybody gets a slice because the cake was selected accordingly.
If only one person can get promoted, or an increased budget for wages is available, could that be resolved without managers, not just in theory but all over the world?
We're talking about allocting scarce resources via cooperation, not competition. Whether you could make every organization completely flat (no managers) is tangential.
I see what you're getting at, though, and yes, of course we can allocate scarce resources by cooperation at a global scale. It already happens even in capitalist countries on issues of tremendous importance, see the negotiations around how water from the Colorado River is allocated.
Education. Same way we all learned not to kinfe fight people at the mall.
Right, but it's not personal relations that prevent the fighting but the threat of being expelled.
You are essentially arguing that it takes capitalistic ownership to enforce social behavior.
How do you prevent knife-fights outside the mall?
Nah, I don't knife fight people in the mall because that shit sucks and I have been educated about it. It isn't because society will deny me a Cinnabon if I do.
This is capitalist propaganda talking. We are discussing a recent economic system with a very specific manifestation of "competition", something that drives little petty fiefdom holders (business owners) to preemptively degrade working conditions and pay for workers and to gradually shift more and more to fixed costs. We live in the world of real things, not little phrases passed on from our oppressors. The divine right of kings was also supported as "the natural state of things". How convenient for our oppressors!
Is your argument that only competition can resolve scarcity?
A house of gold: need not exist at all. This kind of thing is reserved for the dragons sitting atop their treasures as a way to show off.
Living on the coast: this is a so-called natural monopoly, something that cannot be reproduced and scaled up. There is an actual scarcity of livable coastline. Let's talk about how "competition" currently addresses this.
A tiny minority, mostly those in the exploiter class, use their ill-gotten gains to purchase these desirable properties, often only living in them for a few weeks out of the year. They buy them with the expectation that values will increase, as they are dependent on the financialized housing system that increases housing prices far faster than the rest of inflation, than population increase, etc. The decision of who gets to live there is made implicitly, as so many things are in this system, by whether you have joined the exploiter class.
The idea that this is the only way to organize a scarcity is capitalism stealing a person's basic imagination. Humans have invented many systems for doing this and humans can do so again. That's democracy, isn't it? Here's two examples: (1) there could be a lottery or (2) they could be held in common and used by all for vacations. The two options could be combined. And in both cases, addressing the poverty induced by capitalism should come first: who gives a shit about how we decide to redistribute fancy housing until we actually house everyone? The system you're defending forces a good percentage of the population to have no housing at all.
There are also natural monopolies that are already state-run and normalized, as they align with the capitalist system. Individual capitalists don't own the roads, they are held (and paid for) in common. Same for all kinds of utilities. You cannot build 10 totally separate road systems to get from A to B, so they are owned by government agencies. Somehow, they do this without competing with one another.
Hides what prices? To what concept are you referring? Capitalism and markets already hide the true costs, as society pays for so much that isn't on the sticker price. Even putting common infrastructure aside (capitalism requires a state), the capitalist isn't including the environmental degradation or public health impacts of their productive process on their sticker. They're not paying for the cancer they inflicted on your relstive, nor did they ask permission to inflict it. They are, instead, constantly trying to minimize their costs regardless of how much it hurts everyone else. Climate change is another example. A civilization-ending apocalypse is looming due to the failure of capitalism to do anything other than seek profit at the cost of all else.
A nationalized productive process also has the same ability to do accounting on its costs, so who knows what you're talking about. There are entire industries that have been nationalized and work quite well, even in capitalist countries where there're constantly undermined by privatization.
Finally, let's not have any illusions about the actual existence of competition. Capitalism creates a psychology among the exploiter class to cut costs or die. Often this is true. But another way to increase profits and survive is to become a monopoly, which are now ubiquitous. Monopolies end up running their own little planned economies largely free of competition and are about as efficient as anything else under capitalism. They just charge far more than they need to. Imagine if they weren't hellbent on taking as much from you as they could.
I never said anything like that, lol. I'd feel silly if I did.
Leadership inherently uses incentives so this means nothing. Every decision by leadership must be backed by an incentive or it won't happen. But don't limit your concept of incentives to be merely the mechanisms of capitalism, of course.
As I mentioned, Soviet political leadership was cut off at the feet by a genocidal campaign by capitalists. Capitalists are incredibly violent - violence is what sustains their system and attempts to prevent other systems from taking hold. This implicitly suggests a viability to the alternatives.
Soviets did all kinds of things, they took a non-industrialized, largely feudal country and turned it into an industrialized superpower within 10-15 years. This involved cutting costs all the time, so I have no idea what you're talking about.
Similarly, compare blockaded Cuba to Haiti. We haven't even touched on imperialism, a form of capitalism between states, but Haiti is what an imperialized country gets under global capitalism and Cuba is what you get despite the violence and extreme hardship forced on them by capitalist countries. The imperialists have literally and figuratively never forgiven Haiti for their self-emancipation from slavery, rewarding them with massive debt and regular coups.
Under the capitalist system, competition is defined very simply: your business lives or dies. Your business lives because it is profitable or is playing some game to become profitable that is underwritten by finance. Your business dies because it is not profitable or similarly underwritten. Workers being compensated with workplace power does not inherently make a business more profitable and will definitely lead to a higher floor on what costs get cut (labor).
A simpler way to put it might be that if co-ops were simply more viable under capitalism than capitalist businesses, they'd be dominant. Instead, they are usually kept to small-scale outfits. There are exceptions, but they are rare.
This does not mean that co-ops are bad or disorganized. It means the capitalist system barely permits them to exist by its fundamental nature.
Workers do support co-ops. Every worker would rather have a say in their own workplace conditions than get fucked over by some small business tyrant.
But we live under a capitalist system that does not support co-ops and it isn't exactly democratic. We do not control capital, petty tyrants do. We can't just wish for more co-ops, or just want them, we need the capital, the means of production. Socialists know this.
Again, you don't just get access to capital and profit because you want it or even because you're particularly good at organising production. You have to be able to undercut or eliminate the competition. You have to worship the gods of CMC' or delve into the dark arts of bullshit (finance).
Thank you for that analysis.
Right, you didn't write that. You wrote that a coop could struggle when a competitor undercuts costs.
Right now, in this channel: Consequential Efficiency https://reddthat.com/post/3221538
Coops could reduce costs easier with a lower floor than regular companies if workers participate in a long-term reward.
I believe that most people don't want socialism. But the people who do could create a network of coops and share their resources however they like.
There are many markets where businesses can be bootstrapped without capital. Why not enter those markets and have the best margins by offering the best products? There is only a limited need to cut costs if a product doesn't compete on price.
A co-op has a certain harder floor on how much it will cut labor value costs, yep. A private corporation will cut labor costs to below basic needs, eventually. Workers will not do that to themselves, generally speaking, and will push back long before that. Regimes in which wages are maintained due to things like promising better in the future are generally predicated on imperialism, i.e. the worst tendencies have been temporarily foisted onto the imperiakized peoples of the world. But that is temporary: eventually it comes home. We see that happening now through neoliberalism. Wages don't keep up with inflation, social programs are cut, and a resurgent labor (and social) movement is combated with bureaucracy, police, and jail while poverty is criminalized. Left to its own devices, capitalism is constantly in crisis.
Most people have absolutely no idea what socialism is and are only familiar with flimsy capitalist propaganda against it. For example, the arguments you've made against competition are addressed in the basic foundational texts of socialism and have been known to be false for at least two centuries.
Capitalism constantly teaches the basic need for socialist responses. The only question is whether we can organize more effectively and faster than capitalism's solition: naked fascism. Liberals that adopt the pretense of opposing it adopt obviously milquetoast strategies that end up empowering fascists and murdering the left.
No such thing. Even pure knowledge workers require basic materials to support their work like computers and a space to work in. The exceptions are where the employer has offloaded even those costs, which is an effective wage reduction, not a change to how production requires capital.
The point I already raised addresses this. Your scenario is, "what if fixed costs were negligible?" The answer is that this leaves variable costs, i.e. labor, and capitalists will cut labor costs below what co-ops will bear, eventually. And again, if co-ops were more viable under capitalism this would already have happened.
Every product competes on price when it becomes a commodity, i.e. the vast, vast majority of things and services sold. At least, until monopoly takes over. Exceptions are just minor exceptions that eventually disappear due to commoditization.
most people have no idea what capitalism is, much less what socialism is.
Somehow you see all the reasons why coops are hard but you beleave sharing could easily resolve the conflicts about scarce resources.
Establishing successful coops would allow socialists to show that their values are rooted in reality, especially because it is difficult.
That's funny, I don't remember saying that.
I invite you to respond to the content of my critiques of co-ops
OK, I exaggerated. You wrote that beach houses could be shared or distributed in a lottery.
You have clear arguments why coops are not an option. My point is that you can transfer them onto socialism. In socialism, there is a higher floor on worker compensation because workers don't accept being exploited. But then how do workers deal with their country having less goods available?
If you can handle it as a country you can handle it as a coop.
I listed two examples in response to you suggesting that competition is the only option for scarce resource distribution, so... you're obviously wrong on that, which might be why you didn't reply at the time - and still haven't actually responded to the points made in-context.
I listed two examples that took five seconds to think of because they're how some actual human societies have distributed resources (and duties) historically. There are more ways, of course. Nice thing about having power is we would get to experiment with things like what to do with luxury properties.
They're an option in edge cases but they cannot be dominant under the capitalist system. I'm responding to the idea you've been suggesting - that just wanting to do more co-ops will address the fundamental oppressions of capitalism.
I'm not really sure what that means and am surprised there's any point here aside from "I don't like socialism, a thing I know almost nothing about".
It's always weird to get to the "parroting language" portion of a disagreement.
Socialism doesn't really have a single definition, as it's relative to the socialists that win the revolution and what they can implement while under constant violent threat by capital. It is always about expropriation of the means of production and attempting to run the economy in response to human need rather than the petty chaos of capital, but the way in which that happens is a matter of material context.
For example, some people wouldn't say you have socialism so long as there are differences in compensation, which would require a long path to arrive at - many steps with socialists in power and the bourgeoisie suppressed before the society would be deemed socialist. I don't think having that detailed of boundaries really matters - the important thing is that the bourgeoisie are suppressed and there is a winning struggle to depose capitalism entirely.
I have no idea where this scenario came from. It sounds like you have some false suppositions about capitalism and socialism and are assuming everyone else has them too.
You may find it more rewarding to read up on both topics. Our societies are full of propaganda and bullshit about both but it takes a lot of reading to recognize the patterns and tropes.
???
People value things. In capitalism, the ones who value them the most, and who are able to pay, get them.
If you disrupt this mechanism by allocating resources differently, you risk that resources are wasted. Of course you can use other allocations but is that a good idea?
Capitalism has many flaws, e. g. monopolies disrupt this mechanism, but it just has to be better than its competitors to survive.
You imagine taking over capitalism and allocating luxeries differently. I doubt that those luxeries will exist. If workers only want to work e.g. 8 hours per week, because socialism, the surplus will be gone.
If you can make those workers work more under socialism without a gun to their head, then you should be able to do so right now within the legal framework of a coop.
It should be easier because you only have to manage production processes without fighting a war.
Sidequestion: how does a member of the bourgeoisie without capital look like?
That's not limited to capitalism, lol.
What mechanism? You haven't described a mechanism.
Do you not think capitalism itself wastes vast amounts of resources? Have you seen a landfill? How about the humans, including children, that subsist on that waste? The absurdity of so many things that are produced?
You should really read more on this topic. You seem to be stuck in simplistic all-or-nothing thinking. The idea that waste could exist is not itself something anyone should be concerned about. There is no reason to think it won't always exist. The question is what are the material impacts.
Yes.
Still haven't described a mechanism. Maybe you're attempting to understand Baby's First Utility and Pricing argument? I assure you nothing you've said is new to me.
What has to be better than its competitors to survive? Define better.
This is because you don't understand the basic mechanisms of production nor economic systems nor history. Your doubts mean nothing because you have never investigated this topic.
While understanding the origins of surplus requires that you go read, I'll give two examples of how absurd this is that are easy to understand.
The first is that capitalism is extremely inefficient and destructive. Duplicating bureaucracy across businesses, overproduction problems, regular recessions, deliberately inflated unemployment, ripping people's lives apart for short term profit (if you don't care about people's lives, which you should, you can at least understand that destroying someone's ability to work for 40 years because of some 2-year minimum wage stint is bad), chaos in productive direction, blowing resources on fundamentally pointless exercises (the vast majority of marketing and insurance activities), the list goes on. But that's just inefficiencies. Capitalism also requires destruction. The Grapes of Wrath tells a visceral - and common - story of this at human scale (the destruction of stock to address a profitability crisis), but the greatest destruction is through war and financial domination between countries, i.e. imperialism. Capitalism creates crisis and incentives that resolve through the killing of millions by direct murder and by deprivation. Looking at only the British Raj is sufficient to understand this, but it is actually worldwide and constant.
The second is that capitalism has become dominated by finance and speculation, which are drags on production. Humans overpaying for goods and services because debt cost has been thrust upon them, and not merely personsl debt like a credit card, but the actual inflated cost of things likes housing, healthcare, insurance. And, more, because it is dominant, it controls policy, feeding human lives into its maw to shit out dollars.
We are in Fisher-Price pretend land, now. This is beginning to feel like talking to a child that thinks their pretend play is just as valid as your knowledge.
You're gonna have trouble understanding this topic if you can't get past that kind of behavior. It keeps you from seeking knowledge. A kind of self-coddling, producing a false sense of certainty and unearned smugness.
They're either not bourgeois or we need to split a hair to talk about control and ownership being a dual character of one thing: dominant power over the means of production. The bourgeoisie are slaves to the capitalist system as well, they adopt its psychology and carry out its dictates. They are just in the oppressor role and benefit accordingly.
Housing, healthcare, insurance - it is expensive because there is not enough competition - or socialism.
Mark Cuban's pharmacy changes the market. In the same way, somebody could organize resources and create broad competition for all housing and healthcare markets.
You are sure that I don't know enough. How do you know that your knowledge about economy is enough or whom to trust to run socialism?
More playing pretend at knowing even basic economics. "competition" is a little false god that you worship because you're afraid of learning something that challenges the rest of your religion. How sad.
Real estate and housing prices balloon wherever finance and speculation are allowed to operate on them. Feel free to go learn about this at your leisure, as it's pretty clear you are actively avoiding learning anything from me.
At what rate are healthcare costs, including insurance, increasing under your oligarch's new regime? What about the median cost of pharmaceuticals per person?
Yeah duh. It's not like these patterns of deflection are subtle and you're just repeating words lazily absorbed from your masters. The idea of applying thought to them is clearly not on the table.
An incoherent, non-grammatical question that actively ignores everything I've told you about socialism. Sounds about right.
In which housing market without limited supply do prices balloon?
Do you expect me to believe that competition doesn't work at all? We started this discussion with reduced wages due to increased competition among workers.
Do you want to introduce socialism to prevent competition entirely?
Imagine thinking I'm going to answer any of your questions while you've ignored all of mine and most of what I've said.
You're on your own now, lib. Let's see if you can be honest with yourself.
You have two rhetorical questions. You must know that competition ceases within an oligarchy and that my point was to argue for competition and not oligarchy.
Thanks for the exchange.
If coops are more capital efficient and the proletariat definitionally doesn't own capital that means...
There is no amount of efficiency that is more important than momentum. Consider the robber barons. I could make a perfectly effective business but they could just bribe a senator to get a tax cut and beat me. The market can only evaluate one data set and lying cheating and stealing all fall outside the scope of that.
What does that mean? That managing a successful revolution is easier than managing coops?
Why is it important that the proletariat owns capital? Deconstruct your requirements and find a way to achieve your goals. If you try to achieve something that people want then there is a way to get it.
Some people argue that. Also we did industraial and agricultural sabotage to them. Threatened to annihilate the world and and did several wars with them. So not exactly a fair test
How was agriculture sabotaged?
I can find a article fomer cia agents talking about how they did it. They would det fields on fire, break important farm equipment stuff like thst.
Was that enough to turn the country into a net importer? I thought the general mismanagement was the bigger problem.
General mismanagement? They went from a feudal dirt based monarchy to the first spacefairing civilization in a lifetime. Their management was far better than ours. We just had a head start and the power to do more evil.
And yet China managed to survive. Of course there are external factors but it's important to know which internal decisions could have led to success.
Processors, internet, renewable energy, etc. Maybe winning the space race prevented success in other areas?
Stalin should not have stopped till the sea. China is willing to do what it takes to win. They have cut deals with evil countries to get resources to allow them to become the next hegemony. The US might never have stayed on top for quite some time if China had not seized the means of production
The atomic bomb, Stalin had to stop.
But that suggests that capitalistic meddling brought the sovjet union down. The primary question should be how the sovjet union could have kept the lead.