When you start a co-op, just like any other bootstrapped business, you're staking your livelihood, but you're forgoing most of the upside. You also need several other people to agree with you. This screens out most of the risk, which is why they're perceived as working well. This works out great if you're lucky enough to be employed by one, but not great for people who need a job immediately.

Why don't workers unite to democratically manage production? The police, propaganda, wage slavery.

> Why don't workers unite to democratically manage production?

Because the majority of workers are doing the minimum amount of work to get by, because ~50% of workers are below average intelligence, because those with the entrepreneurial skill and/or business management competence necessary to make this happen benefit more from the current system and have less motivation to mess with it.

You must be miserable.

I can’t speak to op’s emotional well being, but he is spot on with his reasoning. In the rarified air that most of us here inhabit, it’s easy to forget that for every college professor there is someone for whom tying their shoes is a significant cognitive challenge. For every really smart person, there is someone who lacks the cognition to participate meaningfully in society. For every brilliant individual, there is someone whose mental capacity puts them in need of lifelong care.

The bell curve is a bitch.

The average person just gets by and doesn’t think all that much about anything outside of their immediate surroundings. For most, politics and such is a team sport, not an intellectual pursuit.

It’s an uncomfortable fact of life, and those that have talents and gifts above the norm are by default responsible for guiding and advancing society. We ignore that burden at the peril of all.

Your view is called Social Darwinism and it’s really dangerous/dystopian. Also collapses under scrutiny.

> Your view is called Social Darwinism

The only thing either response to your original reply have done is provide uncontroversial and non-conspiratorial reasons why Mondragons are extremely rare. Calling that Social Darwinism is like calling you a Stalinist, a slander based entirely on a superficial similarity of your rhetoric.

You guys are both discussing intelligence hierarchies (wtf?) without regard to actual history of popular labor movements being violently squashed.

You'll waste your time expecting materialist analysis from many folks around here.

I don’t think that asserting that intellectual capacity tends towards a bell curve distribution is an example of social Darwinism. I think that’s just called a testable hypothesis validated by a plethora of studies.

As for the idea that people that bother to think about things like their social responsibility to humanity are , by default, responsible for guiding humanity (because people that don’t think about such things will not take an active role in that effort , by definition) seems also uncontroversial.

In short, I have no idea what you’re on about.

That said, I’m with you on labor movements, and believe that unions and coops are generally extremely positive things most of the time.

I just don’t expect much from the average person anymore. Decades of observation has made me skeptical of the ability of the Everyman to act in his own best interests, on average.

It’s worth mentioning that it is apparent to me that this inability is fostered in no small part by people and entities that make it their business to subvert otherwise good faith actors that don’t exercise very much independent thought into pursuing goals and supporting policies that are explicitly or covertly not in their collective best interest. Gullible people are gullible, and they are exploited all up and down the political spectrum.

Maybe the ability and willingness to violently squash others is the highest form of "intelligence"?

If you're so smart, why are you beaten up by my thugs?

If everyone started at exactly the same point, there might be some validity to the idea that the ability to ensure one’s own security was a useful proxy for intelligence. But, clearly, that’s not the world we live in.

I can't tell if you're being sarcastic

The bell curve explains why most people can't do difficult things. It does not explain why most of those who can do the difficult things end up working for someone else (rather than e.g. start a co-op). If stupidity was the entire answer, the smart bosses would be unable to find employees smart enough to work in their companies.

Some businesses only require simple work, so you could argue that they have one smart boss and many stupid employees. But there are many businesses that require highly qualified professionals. And those professionals have mostly been taught that their proper place in life is working for someone else. This is practically what school trains you to do for decades -- there is the teacher who gives commands, and the students who obey. And then you transition to a job where it is the boss who gives commands, and the employees who obey. I wonder whether a different kind of education would result in a different kind of a society.

Yeah, we take a lot of things for granted. Intelligence is relative, and so we do find a normal distribution when defining IQ with a target median and mode of 100. However, we don't have to construct a society where thriving requires a median intelligence! That's a choice made by those who, as you say, benefit more from the system.

It's not so simple to measure intelligence, anyway. I marvel at some of the things a below-average person does every day such as drive a car at high speeds on the interstate, or navigating political bureaucracy. Meanwhile, I'm two standard deviations above the mean but have ADHD and sometimes struggle with basic tasks that even people of below-average intelligence have mastered.

The contrast is so much at times that I can see the confusion and concern in the faces of those around me whenever I have an ADHD moment. Yet, I'm an expert in multiple subjects, a quick learner and have a well-developed sense of intuition. People are multi-faceted, and we're not going to get very far with over-simplistic models of intelligence.

There have been over 20,000 communes set up in the US. They are not illegal. Pick one and join it. Or set your own up.

Socialism is seizing the workplace from the capitalist.

The problem with a system based on taking is that one runs out of things to take.

Better to have a system based on creating things.

Well actually socialism has been historically concerned with maximizing human creativity. Fourier’s utopian vision was “libidinal” work that aligns passions with labor. Marcuse has a similar view in Eros and Civilization. Chomsky views creativity as axiomatic for humans, and syndicalism the appropriate system for harnessing it.

> socialism has been historically concerned with maximizing human creativity

I beg to differ. Socialists are always concerned with distributing production equally. Anyone being creative gets it confiscated from them.

"From each according to his ability, to each according to his need."

Where does creativity come into play?

Where are all the creative products the Soviets made?

> Socialists are always concerned with distributing production equally.

Not really. Socialism (the project of the labor movement) is concerned with workers being in control of their own work, not vessels for capitalist exploitation. Syndicalism is a form of socialism that emphasizes decentralization and federation, as opposed to command control. How resources are allocated under conditions of such federated governance is up for debate.

> "From each according to his ability, to each according to his need."

Socialism is older than Marxism and shouldn't be conflated with it.

> Where are all the creative products the Soviets made?

The USSR was a state capitalist/authoritarian regime, nothing like socialism.

> nothing like socialism

That happens every time. Socialism gets implemented with high hopes, falls flat on its face, and gets declared to be not really socialism at all.

How many times does it need to fail before one realizes it is never going to work?

If you read the literature around the Bolshevik revolution, Lenin's coup was highly criticized as un-socialist: Luxemburg, Goldman, etc.

Simple litmus test for socialism: do workers manage production completely, through direct democratic processes?

The trouble with your definition is the violence necessary to steal the means of production so you can set it up for your workers. A totalitarian government is required to do that. The workers will be severely constrained in what they can do - like set up their own businesses.

You also conflation democracy with freedom. 49% gets subjugated by the other 51%.

Freedom means not being dictated to by the mob.

> violence necessary to steal the means of production

You could argue that private property is theft, necessarily enforced by a repressive state, and reappropriation is justice. The general strike is non-violent (until the police arrive).

> You also conflation democracy with freedom. 49% gets subjugated by the other 51%.

The interesting part about decentralization is that it somewhat relieves this problem. Federation allows for complex arrangements that coordinate towards consensus. So it might not be necessary to subject populations to laws they don't agree with with such broad strokes.

> You could argue that private property is theft [...]

You could, but it wouldn't be convincing. It's a bit hard to convince me that things I bought or made I actually stole. Are you going to argue that if I hire someone to build a patio, I actually stole it from him?

Personal property is distinct from private property.

> Socialists are always concerned with distributing production equally.

This doesn't reflect the most well-known socialist axiom on the distribution of production...

> "From each according to his ability, to each according to his need."

...which you appear to be aware of. The entire point of idealizing "to each according to his need" is that different people have different needs.

> Where are all the creative products the Soviets made?

Didn't they make Sputnik

Yes, they did. Anything else? Is your car a Soviet made car? How about your clothes? Computers? Furniture? Books? Anything in your dwelling?

Back in the heyday(!) of the USSR, tourists would routinely fill their luggage with blue jeans to sell on the black market there.

The Soviet Union was notoriously poor at prioritizing consumer goods, it’s probably one of the reasons for their downfall. One must admit though that both them and the PRC have achieved something in uplifting backwards feudal empires into something resembling modernity. I’m not sure that could’ve been achievable counterfactually, and as we saw with the sudden free market capture of post-Soviet Russia in the ‘90s, with a much smaller body count.

Anyway, you asked for Soviet creative products and I’ve named one. For what it’s worth, I’ve also heard good things about Soviet watches, I had a coworker who collected them and they’ve been discussed before on HN.

https://news.ycombinator.com/item?id=27164417

Digital watches of far greater accuracy are available in a blister pack on a peg in the supermarket for $5.

When the Red Army invaded Germany, the number 1 looted object was wristwatches. Soldiers would have a row of them affixed to their forearms. In multiple books I've read, they were always looking for wristwatches.

My father (B-17 crew) was issued a wristwatch, but I've been unable to find it among his stuff. Timekeeping was essential for coordinated military operations.

> have achieved something in uplifting backwards feudal empires towards something resembling modernity

The USSR was described as 3rd world country with a 1st world military. The PRC launched their economy by abandoning Marxism and embracing free markets. Cuba is a mess as it still tries to hang on to Marxism.

I did read the Soviet watch article when it was here - most interesting!

Cheap digital watches lack the aesthetic charm of mechanical, not to mention are dependent upon battery power.

> The USSR was described as 3rd world country with a 1st world military.

And yet, tsarist Russia was even poorer and had worse standards of living. Pointing out that a change in state led to a difference in quality is not a moral judgment, nor does it necessitate an endorsement of that change.

That’s why cooperatism is superior to socialism and capitalism. It’s a free market of worker-owned companies, creating things by running their businesses together.

It's not a free market if you do not allow capitalism to exist.

Note that capitalism does not exclude worker-owned companies at all. You're free to start one.

The free market is a set of principles between companies, not a principle for how companies need to be organized internally. Capitalism is based on single-owned companies. Cooperatism is based on worker-owned companies. Cooperatism is a better free market based economy. It’s capitalism 2.0.

> The problem with a system based on taking is that one runs out of things to take.

Pretty damning critique of capitalists there, comrade.

What was America like before capitalists? and after? Where did all that wealth come from, comrade?

Did you know there used to be people who lived on that land

I missed the railroads, steel industries, chip manufacturers, iphones, etc. that were looted from those people?

BTW, studies of the bones of pre-Columbian Indians shows they worked hard and suffered from periodic famines, as well as a lot of violence.

Therein lies the commonality between all economic systems: where there are people, there is the taking.

Industries tend to require raw materials, which many times are located in or around land.

Free markets are not built around taking. They are built around exchanging.

Ah, the starry-eyed utopianism. Marxists and Objectivists are truly funhouse mirror images; they may look completely different from one another, but both belong at the carnival.

Free markets are a ideal which has never been achieved, much like socialism. There is, and never has been, a market without regulation, and with only voluntary participation and without stolen goods being exchanged.

Those things weren't looted from the natives.

But the profits were looted from the workers who actually built all that stuff.

Capitalists aren't the ones hammering in steel spikes or wearing clean-room fab suits.

But White people brought diversity, and diversity is strength! They brought doctors, lawyers, and engineers! Food carts on every corner!

Or maybe the people that used to live there shouldn't have let so many migrants in.

Better for the natives and enslaved Africans, that's for sure.

That's a good question and it seems like it's difficult to separate from people's ideological ideas about whether they are good or bad.

My hometown in Oregon had a cooperative, Burley, that made bike stuff like trailers and tandems and some clothing. Word was that it was kind of dysfunctional because of how democratic it was even if all the people cared deeply. I think they finally ended up selling out to some outfit who scrapped everything but the trailers.

There are a few. There's a tech coop federation in the UK for instance. A big hurdle for efforts like this is access to finance meaning they often have to be bootstrapped.

I do not believe it is necessarily about that.

It might be a lack of education (not a value statement). Socialism in Spain was not established at once. It was an effort spanning many decades.

If we would suddenly find ourselves in a medieval kingdom we would certainly need time (and help) to adapt to that system. Likewise, people from that period would need time (and help) to adapt to ours. Regardless of whether it is better.

Note that Mondragon is not a socialist enterprise. It's not obvious to me whether you're saying it is, but I think one of the interesting things about Mondragon is that it's somewhere in between the socialist-capitalist dichotomy. If you came along and said "good news, the state is in charge of all your businesses now" they would not consider their mission accomplished.

Socialism traditionally meant workers control over production. To the degree that Mondragon is democratic it is socialist.

Socialism came to be commonly associated with "State-capitalist monopoly" (Lenin) later in the 20th century but that does not describe revolutionary Spain at all.

There companies were mostly worker owned, democratically managed and freely associated within democratic regional and industrial cartels representing consumers' and producers' interests respectively. Highly advanced democratic systems. Larger companies were expropriated compulsory. Yes. But they were transferred into the ownership of the workforce. While smaller companies generally were free to operate as "private" enterprises though at a certain size that rarely made sense because all of industry was structured to serve democratically managed industrial operations.

Socialism is about social control over production, not worker control. That's the big difference here, so it's relevant to point out. A co-op gives you worker control within the framework of a private ownership society.

Workers control over production was the objective of virtually every popular (socialist) movement well into the 20th century.

Even Lenin propagandized "All power to the soviets!" because his coup d'etat would have been impossible without popular support.

They don’t allow genuine innovation in any shape or form, and that in particular leads to highjacking by bureaucrats and degradation. So they may work in short term (work for some at the price of oppressing the ones who don’t fit well into the collective) - I’m from USSR for example - yet the result is predetermined.

That is flatly false. Worker cooperatives are every bit as innovative as any other form of private corporation. These are owned by workers not a centralized government. There are quite a few of them and you may well have purchased their products with it even realizing it. Two additional examples you may have encountered are Equal Exchange and King Arthur Flour.

There aren't more of them because they have a hell of a time securing financing when most businesses are financed through equity sales which they can't do.

Example of innovation please. I’ve seen first hand that no collective farm is able to produce nor SpaceX nor even EV nor even plant in time and harvest in time.

I'm not close enough to manufacturing to evaluate how innovative their approaches to factory automation are, but it's not like they're based solely on turnips:

https://www.mondragon-assembly.com/automotive/

The collective farm that produced SpaceX is the United States Government. It carried out all the research and development necessary to create and further the North American space program. And it is existential in furthering it to this day. Without this source of contracts, research projects and income SpaceX would not be able to produce its commercial spin-off products.

You obviously never been to a collective farm.

Despite government support to the extent much larger than that for SpaceX collective farms have nothing to show for it.

Maybe because they are farms and not rocket makers

Why they are farms and not rocket makers? Because collective.

But there are very successful rocketry collectives! They just typically aren't called "farms".

Things like Friends of Amateur Rocketry have all the characteristics of a collective (including legal status) https://friendsofamateurrocketry.org/

The constraining factor is typically budget (as mentioned up-thread).

By this logic capitalism is the thing holding back capitalist farms from being rocket makers too? Or do you only apply it when you get to use the word "collective"?

Of course it is the logic of collective. In capitalism you decide how you'd want to spend your resources, on a farm or on a rocket. In collective it is collective who decides.

Capitalist farms - why are they farms and not rocket makers? Is capitalism holding them back?

In capitalism it is your choice how to spend your resources - on the farm or on a rocket shop.

That's not an excuse. In socialist Czechoslovakia, a coop farm produced computers.

https://en.wikipedia.org/wiki/JZD_Slu%C5%A1ovice#TNS_Compute...

It looks like this system was created out of necessity; there was no viable product for what they needed. Necessity is the mother of innovation after all, and we find this sorts of innovation frequently in non-collectivized entrepreneurships as well. Still, very cool!

If it weren't for the Wright Brothers, NASA would never have existed.

Maybe so but I am not arguing with that. The original claim is much weaker: No "collective" produces innovation.

Open source software

There are multiple Kibbutz in Israel that plant and harvest on time and are the major source of innovation for Israel's AgTech sector (which is only behind the US in terms successful startups).

    > most businesses are financed through equity sales

Can you explain this more? As I understand, after equity IPO, most companies use debt capital markets to raise money to expand their business.

You've just changed my brand of flour, thanks.

It seems a bit premature to speak so generally about collectivism. It's quite possible that the USSR failed for reasons that do not apply to Mondragon.

Maybe once we've seen a few hundred of these come and go it'll be time for a general theory of their kind.

>It seems a bit premature to speak so generally about collectivism

2B people spent better part of 20th century doing the experiment, killing tens of millions of those who didn’t completely shared the ideas of the collective, and you think it is premature?

General theory is in the Das Kapital. So far the things have worked as described. People by mistake ascribed happiness to the outcomes calculated there while there is no such happiness was predicted by that theory. Ie communism isn’t a happy place like some naïve readers think, communism is prison and oppression.

Wasn't the USSR quite open about not being communist and at best working towards "socialism" as a pathway towards communism?

Surely the USSR is an example of the pigs pulling a bait and switch rather than communism.

The failure of the USSR to achieve communism is a side show to all the variations on worker | producer collectives that didn't fall to Stalinism.

Totally. The USSR had no worker-owned companies. They all belonged to the state. There was no economy which is based on cooperatives in a free market, yet.

I think we can also say that the former USSR has also failed to achieve capitalism despite having 30 years to do it. So maybe there's some other factors at play.

Compulsory participation is quite a separate thing. Everyone who works at Mondragon could just go work somewhere else if they wanted.

Mondragon has lasted 68 years and I believe the USSR had lasted 69 years. Why do you think they will fail in the next year? Also given the speed of advancement has increased in the past 30+ years, it seems like they have kept pace a lot better than the USSR (or it's successor Russia)

Or have you worked there and this is first hand?

I don't think the USSR is a great example. The region has been under the thumb of authoritarian dictators for a 1000 years and those who most strongly disagreed with this have for that millennium either left or died leaving behind a nation largely populated by the children of people willing to go along to get along under such a system. Cultures and circumstances leave a mark on a people not least by the process by which survivors are selected.

If anything the current situation stands to worsen that situation with smart young people who might contribute to a better future dying or fleeing.

The paradox of worker-coops is that workers capable of successfully running businesses together are also capable of running businesses independently, so there's no need to form a co-op. It's those incapable of running a business individually or collectively that then form co-ops. Mondragon is the exception, not the rule.

Put another way: Singers who aren't good enough to make it on their own form large idol groups (eg: AKB 48) to sell themselves, while those who are become stars on their own or form small bands with others of similar success.

Or to put it another way: Ground meat is great, but the components thereof by themselves are generally regarded as waste.

This whole train of metaphors is just bizarre and wrong. Singers who aren't good enough to make it on their own are never heard of or discussed. Ground meat made from poor quality meat is poor quality ground meat, and people do, in fact, grind the good stuff to make good stuff.

And I'm sure that plenty of people who could start a business on their own could start a business with the help and support of like-minded partners, and might even be better off for it. I'm not sure where we get the idea that founders must be lone-wolf savants.

>Singers who aren't good enough to make it on their own are never heard of or discussed.

Correct. I've definitely heard of AKB 48 and other idol groups; I have never heard anything concerning any specific member of one other than randomly showing up on a cheap variety show long after they retired ("graduated") from showbiz.

>Ground meat made from poor quality meat is poor quality ground meat

But it's generally preferable to the poor quality component meats, which was what I tried to allude to.

>people who could start a business on their own could start a business with the help and support of like-minded partners,

People with the chops to become founders on their own can also become co-founders joining with other similar people.

People without the chops can't become founders without joining others to become co-founders.

Basically: All apples are fruits, but not all fruits are apples.

Cooperation is difficult and does not scale well. One selfish person can act selfishly alone. But one cooperative person first needs to find someone else to cooperate with... and the other person also needs to have compatible skills and values... so it is often easier for the cooperative person to just give up, and work to make someone else rich.

And the more difficult project you have, the more extreme this gets. If it is something that most people could do, it is easy for the cooperative people to find each other. It if it something that only one person in a thousand can do, the one-in-a-thousand cooperative person will have a huge problem finding the rest of the team.

Considering that I just started one, the reason is, nobody will fund it

Why? Everybody with the money to start it, wants more money or special tax treatment via charity.

I’m actively funding ours myself for 0% return in order to bootstrap the infrastructure we need

There are more of them, but good design "just works" and so goes mostly unnoticed.

Actually, I wonder if there's a word for this effect?

A comment below suggests that they have a hard time recruiting engineers, but I believe also experts and talent in general..

There’s then also something deeper about making the trade-off between growth(rate) and stability..

OTOH photographer coops are quite common, here is a famous one https://en.wikipedia.com/wiki/Magnum_Photos

Does the Basque region produce more engineers than other areas? I'm guessing their issue is more tied to the demographics of the area they are in and less of the compensation side of things. It's far harder to commit to a coop where your contribution is valued thousands of miles away and you don't have the immediate stake in things (e.g. your bar, bakery, barber, etc)

You are probably right.

However, if your issues are tied to local characteristics, then (in maybe an abstract way) you still have another fundamental obstacle to scalability, not related to compensation..

(FWIW i think an interesting related question is whether YC might be able to scale outside SF if they werent so into the slogan “do things that dont scale” — which i sometimes interpret as the viridical paradox “scale by not scaling”)

Realistically Mondragon is rooted in Catholic social teaching (founded by a priest). Thus it requires someone to be motivated by something other than money. Religion is one of the few things that will be able to inspire such amounts of work while forgoing most economic upside.

Maybe nationalism can do that, but keep in mind that when this was combined with nationalism we got Nazism (Nazism took lots of inspiration from Austrian corporatism which was similarly influenced by Catholic social teaching here). I'm not sure it's either safe or advisable to do this aside from religion

> Why aren’t there more of these

By historical reasons the Basque country has an special tax regime and economical benefits from the Spanish government. This may have an influence on the outcome. Is easier to win when the other run handicapped, and not so easy to replicate it if we remove that context.

Most people also ignores that this system exists. Out of Euskadi, the name is more associated to the (in)famous band orchestre Mondragon, that was an appropriately anarchical mess, part circus, part rock band.

Be afraid, very afraid: https://www.youtube.com/watch?v=XWKHnjWMTNI