For the sake of our communities and our environment, our economy will need to transform. But how? The language of “economic democracy” points us in a direction, but in order to make concrete advances and replicate successes, we need to be clear about just what a democratic economy consists of. A new resource from The Next System Project can help guide the way:
Traditional policies and approaches are demonstrably failing to alter deteriorating long-run trends on income inequality, concentrated wealth, community divestment and displacement, persistent place- and race-based poverty, and environmental destruction. As a consequence, we have witnessed in recent years an explosion of interest in and practical experimentation with a variety of alternative economic institutions and models of ownership—from worker cooperatives and community land trusts to public banking and community development financial institutions—that are capable of fundamentally altering patterns of ownership and producing dramatically better distributional and other outcomes as a matter of course. New hybrid forms are emerging, as well as ideas as to how innovative combinations might produce still more powerful results. Taken as a whole, these institutions and approaches form the mosaic of a new democratic economy in the making, suggesting the contours of a next system beyond corporate capitalism and some pathways for getting there.
Elements of the democratic economy distills this landscape of theoretical exploration and real-world practice into concise summaries describing each of the institutions involved, assessing their transformative characteristics and potential impact, and providing on-the-ground examples and a sense of the challenges yet to be overcome. The series is intended as an entry point for all those looking to understand the various building blocks of the democratic economy currently being constructed from the ground up in communities across our nation and around the world.
Explore sections on community land trusts, democratic energy utilities, resident-owned communities, limited equity housing cooperatives, and green banks. Check it out here.
On August 12th, historic legislation was passed in the form of the Main Street Employee Ownership Act — legislation which promises to “support small businesses that save jobs and invest in their workers and communities by transitioning to an employee-owned business form such as a cooperative (co-op) or an Employee Stock Ownership Plan (ESOP).”
“We applaud this commitment to provide education, microloans, and training through the Small Business Administration, which will cultivate healthy business successions to employee ownership, saving critical business assets and keeping our communities strong and prosperous,” said Melissa Hoover, Executive Director of the Democracy at Work Institute (DAWI). More from DAWI:
Thousands of worker cooperatives and ESOPs in the US have demonstrated that employee ownership is good for businesses, workers, and the local economy. Companies that transition to employee ownership see an increase in productivity by 4 to 5 percent, tend to survive longer than conventional firms, and have fewer layoffs. With a more equitable pay ratio and demonstrated impacts for workers across the wage spectrum, “employee ownership has great potential to stabilize employment, to root productive capital in communities, and to increase the assets and incomes of working families,” according to the National Center for Employee Ownership.
This legislation, which improves access to capital and technical assistance for employee-owned businesses, will greatly help worker co-ops, includes directives to SBA to:
Finance the sale of businesses to their employees
Work with Small Business Development Centers across the country to provide training and education on employee ownership options
Report on SBA’s lending and outreach to employee-owned businesses
On Friday, May 11th, in collaboration with Democracy @ Work New York, the Murphy Institute hosted a fascinating panel exploring how progressive local innovations stand to solve long-standing, seemingly intractable issues around poverty and inequality. Panelists included:
Michael Menser, Assistant Professor of Philosophy at Brooklyn College, Earth and Environmental Science and Environmental Psychology at the CUNY Graduate Center, Chair of the Board of The Participatory Budgeting Project, and author of We Decide! Theories and Cases in Participatory Democracy
Gabriela Alvarez, Chef and founder of Liberation Cuisine, a catering company dedicated to preparing meals collectively with sustainable ingredients and practices. Alvarez recently took her passion for healing and organizing with food to Puerto Rico to help with relief and rebuilding efforts
Kali Akuno, co-founder and co-director of Cooperation Jackson, a network of cooperatives and worker-owned enterprises and the author of Jackson Rising: The Struggle for Economic Democracy and Black Self-Determination in Jackson, Mississippi
Yorman Nunez, Program Manager at Community Innovators Lab MIT and coordinator of Bronx Cooperative Development Initiative
Miss the panel or want to experience it again? Watch it here:
In New York City worker cooperatives, participatory budgeting, and community land trusts are on the policy platform of the City Council’s progressive caucus and elected officials in the democratic party are pushing legislation for employee and worker ownership at the state and federal levels. With greater visibility and support from the public sector some believe that these pilots and experiments for neighborhoods to drive wealth creation and capture and create equitable economic opportunities can reach into broad-based and mainstream policy.
There is an opening here to expand the horizon of what is seen as possible for genuine equitable urban economic development, and its relationship to labor, communities and the political economy. In short, we can change the conversation from mostly pushing for greater accountability and transparency in the existing economic development order, to a conversation about what should come next and what policies and institutions would be a part of getting us there.
In honor of the birthday of W.E.B. Du Bois, who amidst other great accomplishments authored Economic Co-operation Among Negro Americansin 1907, the Murphy Institute hosted a forum on Friday, February 28th to explore the stories, struggles and successes of workers who have taken control and bettered their lives through the cooperative history of African-American communities, and ask how we can apply those lessons to contemporary struggles locally and around the globe.
Missed the forum, or want to re-watch it? Check out video coverage from the event below:
On the Laura Flanders Show this week, Damayan Cleaning Cooperative, the first Filipina migrant worker-cooperative in the United States had a chance to tell their story. Comprised primarily of survivors of labor trafficking, these cooperative members have created dignified, democratic livelihoods for themselves by starting a cleaning cooperative.
Want more on worker cooperatives, solidarity economies, and the role of organized labor? Join us at the Murphy Institute on December 4th for our upcoming Labor Breakfast Forum, Solidarity Economies: Worker Coops.
In the 1980s, the British government supported a comprehensive system of local worker cooperative support organizations (CSOs). The first CSO was formed in Scotland in 1976. By 1986, approximately 100 CSOs spotted the country — with higher concentrations in urban areas. About 80 of these CSOs were funded — mostly by local municipalities — with full-time staff at an average of three employees. In tandem, Parliament chartered a national “Co-operative Development Agency” with a 1978 bill — which aided the growth of local CSOs, served as a “safety net” for regions without CSOs, collected statistics, and acted as government liaison with regard to new legislation.
These government-funded support organizations engaged primarily with low-income, ethnic minority, and female entrepreneurs. CSO staff members provided training courses on worker cooperatives, direct technical assistance, and also loan financing at an average of $50,000 (current U.S. dollars) per worker cooperative. This ten-year experiment produced approximately 2,000 new worker cooperatives — and almost none exist today.Continue reading What is Worker Cooperative Development?→
A conversation about workers, communities and social justice