I think government should be promoting workers cooperatives by waiving business and salary taxes for them. Otherwise they can't compete with traditional businesses that can squeeze out additional value from workers at workers expense.
I love co-ops I think the government should do more to Foster them. I would start by waving corporate tax first. Basically the same as a pass-through chapter S Corporation.
Waving salary taxes is a different story though. I don't see why someone working for a regular company should have to pay for Medicare and Roads but someone working at a co-op should get these for free.
I've been on the board of directors for a co-op in the main challenge is Raising funding. If you want to start a housing Co-op or a auto repair Co-op, those both require capital. If folks want to see more co-ops, I would look for ways to make Capital more available.
> I don't see why someone working for a regular company should have to pay for Medicare and Roads but someone working at a co-op should get these for free.
Mostly to send a message that you shouldn't work at a regular company. Unless it pays so much that you are better off even after tax.
> If folks want to see more co-ops, I would look for ways to make Capital more available.
Capital goes to where one can get return on capital. To get more capital to coops you need to make them competitive first.
The capital question is more complex then returns. Co-ops can pay return on Capital Lending and be competitive. The challenge is finding people willing to take on a loan.
Housing is a really good example. If you have a down payment, most people would not want to use it and take on a mortgage to create a housing Co-op. They would prefer to simply buy a house.
A housing Co-op is attractive for people that can't buy a house by themselves. You can band together with other people to make a down payment, but again, this is unattractive for most people because there is no good exit strategy to cash out. This is the downside of co-ops. They still take investment and risk to create.
Regarding your first point, I assume you were talking about worker co-ops. I don't see why society would want to incentivize people to join them beyond the benefits that those people would naturally see from working at one. on the flip side, why punish workers are aren't part of co-ops?
If it is a good deal for the workers, they should do it. If it is a bad deal for the workers they shouldn't.
> You can band together with other people to make a down payment, but again, this is unattractive for most people because there is no good exit strategy to cash out.
Yea. It probably doesn't work if you are wanting to buy something as an investment that you are planning to cash out of. But if you buy to use (to live or to produce something) it is attractive to collectively buy to have larger bargaining power and better credit trustworthiness if the risk is shared.
> I don't see why society would want to incentivize people to join them beyond the benefits that those people would naturally see from working at one.
Another thing is that working conditions and salaries got really ridiculous and a whole class of employed poor rose that borderline can't sustain themselves with their work.
It's hard to regulate this stuff in current ownership model. So I think our best bet is to promote alternate ownership models so we may end up in less insane place than the one towards which we are heading.
> on the flip side, why punish workers are aren't part of co-ops?
It's never actually punishing workers. Ultimately it's the employer who pays for it all. And it makes sense because todays employer on average doesn't invest into the education of the workers, in their health and development, in their safety net. So it's only fair he should be paying for those costs that he externalizes to society.
In case of worker co-ops it's reasonable to assume that workers in them will be taken care of better. So less burden on society from externalized costs.
> If it is a good deal for the workers, they should do it. If it is a bad deal for the workers they shouldn't.
Currently the deck is stacked against coops because being able to fuel your company by burning people is a real advantage so a company that does that more will nearly always win with the one that does that less. And losing company will eventually have to dissolve so workers are pretty much left without a choice.
>Yea. It probably doesn't work if you are wanting to buy something as an investment that you are planning to cash out of. But if you buy to use (to live or to produce something) it is attractive to collectively buy to have larger bargaining power and better credit trustworthiness if the risk is shared.
I think you are missing the point. Im talking about real barriers that prefent people from cooperative agreements, even when they just want to use it.
In the real world, it is rarely attractive to collectively buy, because you are locked in. This is the challenge.
If you want to start a cooperative house, you basically need to be willing to live there forever or walk away from your down payment. The same is true for starting a coop business.
Im not interested in hearing the benefits of coops, Im already a fan of them. I was hoping for an intelegent conversation about how their major limitations can be overcome.
It is much harder to find someone to buy 25% of a house to live in or 25% of an auto shop to work in.
Joint ownership is hard and you need a high level of trust in your cooperative partners.
Imagine what it would take to convince you to buy 1/4 of 4 unit apartment with strangers. You might be putting your financial life's work in their hands.
As I point out in a sibling comment, the main challenge is that they have more difficulty raising capital for creation or growth. In my experience, co-ops can be pretty efficient otherwise.
First of you said the same thing twice because profit is revenue minus expenses so higher expenses with the same revenue mean less profit.
I said the same thing that workers cooperatives aren't competitive because they have lower profit because they can't get expenses (on salaries) get that low because they can't exploit workers like the usual business does.
can you please explain what you mean by this with some examples? there are worker-owned cooperatives that run as efficiently as businesses when considering expenses and profit.
What happens now is that things produced by workers cooperatives can't cost more because they wouldn't find customers so if the workers don't want to exploit workers they won't be competitive. Tax break would give them the edge that normal businesses get when they fuel themselves with never ending rotation of exploited workers.
The end goal is not to make lives more or less affordable. Just make the work more reasonable by putting working people in charge of how work is organized and rewarded, more often.
Yeah, no more business and work taxes. But also zero wealth captured by very few capital owners. Money stays in the hands of the workers/consumers so they have money to fund stuff bottom up or if necessary pay higher taxes. It's way easier to effectively tax the workers than tax the capital owners when it comes to it.
Banks can also be co-owned by the workers, perhaps some less risk averse depositors. Risky is a relative term... what are banks going to do with their money if that's one of the only few investments available?
Also some loans might be guaranteed by the government, like it happens with some today, if they are for companies in a inherently risky but promising industry.
Small businesses do. Business that dont have high capital costs do.
But any industry with high capital costs, hardware, electronics, automobiles, consumer appliances, pharmaceuticals all have massive start-up costs that bank loans wont work for.
You think Tesla would ever exist with just bank loans?
> You think Tesla would ever exist with just bank loans?
Who knows what would be possible in a world where GE was a company owned and managed by the workers. Maybe no one would cancel EV1. Relying on billionaires to chip in on a new ideas is really fickle.
yeah. also need less structural barriers for legally forming a cooperative. it's so confusing and obtuse if you want to form one, and a lot of states make it hard for some reason (we need something like stripe atlas for worker cooperatives).
plus a lot of folks don't even realize organizing a business like this is an option. and a lot of folks wrongly assume that cooperative == less money / less efficient. we've been brainwashed by the capitalist organization of enterprise.
The State should straight up take over regular businesses and make 'em into workers co-ops.
And make sure to have labour courts to keep 'em operating within the republican norm.
