The revolt that shook the world

History does not travel in a straight line. I won’t argue against that sentence being a cliché. Yet it is still true. If it weren’t, we wouldn’t be still debating the meaning of the October Revolution on its centenary, and more than a quarter-century after its demise.

Neither the Bolsheviks or any other party had played a direct role in the February revolution that toppled the tsar, for leaders of those organizations were in exile abroad or in Siberia, or in jail. Nonetheless the tireless work of activists laid the groundwork. The Bolsheviks were a minority even among the active workers of Russia’s cities then, but later in the year, their candidates steadily gained majorities in all the working class organizations — factory committees, unions and soviets. The slogan of “peace, bread, land” resonated powerfully.

The time had come for the working class to take power. Should they really do it? How could backward Russia with a vast rural population still largely illiterate possibly leap all the way to a socialist revolution? The answer was in the West — the Bolsheviks were convinced that socialist revolutions would soon sweep Europe, after which advanced industrial countries would lend ample helping hands. The October Revolution was staked on European revolution, particularly in Germany.

The beginning of the October Revolution in Nizhny Novgorod on the Annunciation Square

We can’t replay the past and counterfactuals are generally sterile exercises. History is what it is. It would be easy, and overly simplistic, to see European revolution as romantic dreaming, as many historians would like us to believe. Germany came close to a successful revolution, and likely would have done so with better leadership and without the treachery of the Social Democrats who suppressed their own rank and file in alliance with the profoundly undemocratic Germany army. That alone would have profoundly changed the 20th century. And provided impetus to the uprisings sparking off across the continent.

Consider the words of British prime minister David Lloyd George in 1919 as he discussed his fears with Georges Clemenceau, the French prime minister: “The whole of Europe is filled with the spirit of revolution. There is a deep sense not only of discontent, but of anger and revolt among the workmen against prewar conditions. The whole existing order, in its political, social and economic aspects is questioned by the masses of the population from one end of Europe to the other.”

What country goes first?

Russia was the weak link in European capitalism and the stresses of World War I added to the conditions for a revolution. Not an inevitability. Leon Trotsky’s analogy of a steam engine comes to life here: “Without a guiding organisation, the energy of the masses would dissipate like steam not enclosed in a piston-box. But nevertheless what moves things is not the piston or the box, but the steam.”

The October Revolution wouldn’t have happened without a lot of steam; without masses of people in motion working toward a goal. The revolution faced enormous problems, assuming it could withstand the counter-assault of a capitalist world determined to destroy it. The revolution was a beacon for millions around the world as strikes and uprisings, inspired by the example of Russians, touched off across Europe and North America. Dock and rail workers in Britain, France, Italy and the United States showed solidarity through refusing to load ships intended to be sent to support the counterrevolutionary White Armies that massacred without pity. Armies, assisted by 14 invading countries, that sought to drown the revolution in blood.

The revolution survived. But the revolutionaries inherited a country in ruins, subjected to embargoes that allowed famines and epidemics to rage. The cities emptied of the new government’s working class base, the country surrounded by hostile capitalist governments. There was one thing the Bolshevik leaders had agreed on: Revolutionary Russia could not survive without revolutions in at least some countries of Europe, both to lend helping hands and to create a socialist bloc sufficiently large enough to survive. The October Revolution would go under if European revolution failed.

Meeting at the Putilov Factory (1917)

Yet here they were. What to do? With no road map, shattered industry, depopulated cities and infrastructure systematically destroyed by all armies hostile to the revolution — having endured seven years of world war and civil war — the Bolsheviks had no alternative to falling back on Russia’s own resources. Those resources included workers and peasants. For it was from them that the capital needed to rebuild the country and then begin to build an infrastructure that could put Russia on a path toward actual socialism, as opposed to an aspirational goal well into the future, would come.

The debates on this, centering on tempo and how much living standards could be short-changed to develop industry, raged through the 1920s. Russia’s isolation, the dispersal of the working class, the inability of a new working class assembled from the peasantry to assert its interests and the centralization necessary to survive a hostile world — all compounded by ever tightening grasps on political power by ever narrowing groups that flowed from the country’s isolation — would culminate in the dictatorship of Stalin.

Privatization ends chance of democratic control

Stalin would one day be gone and the terror he used to maintain power gone with him. But the political superstructure remained — the single party controlling economic, political and cultural life, and the overcentralized economic system that steadily became a more significant fetter on development. The Soviet system was overdue for large-scale reforms, including giving the workers in whose name the party ruled much more say in how the factories (and the country itself) were run. Once the Soviet Union collapsed, and the country’s enterprises were put in private hands at minuscule fractions of the value of those enterprises, the chance to build a real democracy vanished.

A real democracy? Yes. For without economic democracy, there can be no political democracy. The capitalist world we currently inhabit testifies to that. What if the people of the Soviet Union had rallied to their own cause? What if the enterprises of that vast country had become democratized — some combination of cooperatives and state property with democratic control? That could have happened because the economy was already in state hands. That could have happened because a large majority of the Soviet people wanted just that. Not capitalism.

They were unable to intervene during perestroika. Nor did they realize what was in store for them once the Soviet Union was disbanded, and Boris Yeltsin could impose shock therapy that threw tens of millions into poverty and would eventually cause a 45 percent reduction in gross domestic product — much deeper than the U.S. contraction during the Great Depression.

A revolution that began with three words — peace, bread, land — and a struggle to fulfill that program ended with imposed “shock therapy” — a term denoting the forced privatization and destruction of social safety nets coined by neoliberal godfather Milton Friedman as he provided guidance to Chilean dictator Augusto Pinochet. Millions brought that revolution to life; three people (the leaders of Russia, Ukraine and Belarus) put an end to it in a private meeting. With the financial weapons of the capitalist powers looming in the background, ready to pounce.

The Soviet model won’t be recreated. That does not mean we have nothing to learn from it. One important lesson from revolutions that promised socialism (such as the October Revolution) and revolutions that promised a better life through a mixed economy (such as the Sandinista Revolution) is that a democratic economy and thus a stable political democracy has to rest on popular control of the economy — or, to use the old-fashioned term, the means of production.

Leaving most of the economy in the hands of capitalists gives them the power to destroy the economy, as Nicaragua found out in the 1980s and Venezuela is finding out today. Putting all of the enterprises in the hands of a centralized state and its bureaucracy reproduces alienation on the part of those whose work makes it run. It also puts into motion distortions and inefficiencies because no small group of people, no matter how dedicated, can master all the knowledge necessary to make the vast array of decisions that make it work smoothly.

The world of 2017 is different from the world of 1917; for one, the looming environmental and global-warming crisis of today gives us additional impetus to transcend the capitalist system. We need to produce and consume less, not more, unlike those of a century ago. We need the participation of everyone, not bureaucracy. Planning from below with flexibility, not rigid planning imposed from above. But we need also learn from the many advancements of the 20th century’s revolutions — the ideals of full employment, culture available for everyone, affordable housing and health care as human rights, dignified retirements, and that human beings exploiting and stunting the development of other human beings for personal gain is an affront.

The march forward of human history is not a gift from gods above nor presents handed us from benevolent rulers, governments, institutions or markets — it is the product of collective human struggle on the ground. If revolutions fall short, or fail, that simply means the time has come again to try again and do it better next time.

This article originally ran in the Indypendent newspaper of New York.

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Creating a participatory system of economic democracy in Rojava

Out of repression has emerged one of the world’s most interesting experiments in democracy. And by democracy, what is meant is not the formal capitalist variety of elections every few years in which consumption of consumer products is substituted for participation in societal decisions.

Surrounded on all sides by hostile forces intent on destroying them, in a part of the world that Western pundits claim can only be ruled by dictators, the Kurds of Syria are intent on creating a society more democratic than any found in North America or Europe. This is not simply a matter of creating institutions of direct and communal, as opposed to representative, democracy but, most importantly, democratizing the economy. In the words of the imprisoned Kurdish leader Abdullah Öcalan, “In self-government, an alternative economic system is necessary, one that augments the resources of society rather than exploiting them, and in that way satisfies the society’s multitude of needs.”

The many sides of that equation are explored in detail in Revolution in Rojava: Democratic Autonomy and Women’s Liberation in Syrian Kurdistan,* a study of Rojava’s experiment in radical democracy by three activists who spent months in Rojava studying the society being constructed, and who themselves have been involved in Rojava in various capacities. One of the authors, Anja Flach, spent two years in the Kurdish women’s guerrilla army. Her co-authors are Ercan Ayboga, an environmental engineer, and Michael Knapp, a historian. Although the three authors make clear their sympathies for the Rojava revolution, their book is not hagiographic, but rather a serious analysis of a developing process.

The Kurdish people are split among four countries — Iran, Iraq, Syria and Turkey — and have long suffered persecution in each of them. Their persecution in Turkey is well known; successive Turkish governments have attempted to disrupt organizing, obliterate Kurdish culture and ban the Kurdish language through waves of lethal military crackdowns. Mr. Öcalan escaped Turkey after a military coup that led to hundreds of thousands of Kurds thrown into jail; he and the Kurdistan Workers Party (PKK) he leads were granted asylum in Syria. In the late 1990s, under Turkish pressure, Syria expelled the PKK, and a year later, Mr. Öcalan was abducted from a Greek consulate (a kidnapping believed to be a CIA operation) and has been imprisoned in Turkey since.

But that the Syrian régime found the PKK a useful lever against Turkey for a time did nothing to ameliorate ruthless repression against the Kurds of northern Syria. The Ba’ath Party of the Assad family implemented a policy of “Arabization” against Kurds and the other minority groups of the areas now comprising Rojava. Kurds were routinely forcibly removed from their farm lands and other properties, with Arabs settled in their place. Bashar al-Assad, in contrast to the misplaced hopes that he might institute a thaw upon succeeding his father in 2000, instituted a harsh neoliberalism. Mass privatization, suppression of unions, the shredding of the social safety net and a channeling of investment capital into tourism and away from production had a particularly devastating impact on Rojava.

After the uprisings in Syria against the Ba’ath régime began in 2011, the struggle quickly became militarized. The Kurds avoided being overrun by the Syrian army or the various Islamist forces because of their own organization. Grassroots organizing had been done steadily since the 1990s, and when local government collapsed following the 2011 uprisings, that organizing, a nascent council system and the formation of militias enabled the carving out of an autonomous territory. People surrounded government buildings, demanding the surrender of all arms while guaranteeing the safe passage of all Syrian government officials. This tactic worked, quickly sweeping through all three “cantons” of Rojava. (A canton is a portion of a province, perhaps bigger than a U.S. county or French department but smaller than a U.S. state or a French region.)

The aim here was to create a democratic territory through peaceful means. This takeover was accomplished nearly without bloodshed, although Rojava’s militias have had to repeatedly repulse attacks from Islamic State, al-Qaeda and other hostile forces, as well as fend off the sometimes active hostility of the Turkish government, which has allowed Islamic State terrorists to freely cross the border and re-arm themselves. Sadly, Rojava has also been subjected to periodic blockades and political harassment from the two corrupt parties that control Iraqi Kurdistan, which borders Rojava to the east.

The system of democratic autonomy

The basic units of Rojava’s organization are councils and commissions. These constitute the building blocks of Rojava’s system of “democratic confederalism.” The authors of Revolution in Rojava explain this concept in this way:

“Democratic Confederalism aims at achieving the autonomy of society, that is, a society that administers itself through small, self-governing decentralized units. It entails a permanent social revolution, reflected in every aspect of social structure. All institutions are self-organized and self-administered.” [page 44]

Concurrent with that concept is “democratic autonomy,” which is defined as “the autonomy of the commune” in an “anti-centrist, bottom-up approach.” The commune is the basic unit of self-government, the base of the council system. A commune comprises the households of a few streets within a city or village, usually 30 to 400 households. Above the commune level are community people’s councils comprising a city neighborhood or a village. The next level up are the district councils, consisting of a city and surrounding villages. The top of the four levels is the People’s Council of West Kurdistan, which elects an executive body on which about three dozen people sit. (“West Kurdistan” is the portion of Kurdistan that lies within Syria.)

Integrated within the four-level council system are eight commissions — women, defense, economics, politics, civil society, free society, justice and ideology — that work with councils at all four levels; in turn commissions at local levels coordinate their work with commissions in adjacent areas. There is also a ninth commission, health, responsible for coordinating access to health care (regardless of ability to pay) and maintaining hospitals, in which medical professionals fully participate. Except for the women’s commission, all bodies have male and female co-leaders.

Taking with upmost seriousness the full liberation of women (also expressed in the all-women’s militias that fight on the front lines the same as men’s units), the women’s commissions are tasked, inter alia, with adjudicating cases of patriarchal violence and forced marriage. An umbrella women’s movement organizes women across Rojava, taking on activities including educational work, publishing a newspaper, pushing for legislation, and investigating and documenting domestic violence. This work has roots in the 1990s, when PKK women organized door to door. When organizing by men was heavily suppressed after 2004, women organized clandestinely, giving them experience.

Making women’s participation central is of course a glaring contrast with the Islamist groups and the so-called moderate groups of the Free Syrian Army. Every organization in Rojava must include at least 40 percent women. Asya Abdullah, co-chair of the Democratic Party of Kurdistan, Rojava’s largest party, said the revolution is conscious of not repeating the mistakes of the past, in which women’s liberation was often put on the back-burner. She said:

“We’re a still long way from achieving our goals. … But we’ve learned from the failed revolutions in the past. They always said, ‘Let’s carry the revolution to success, and then we’ll give women our rights.’ But after the revolution, of course, it didn’t happen. We’re not repeating that old story in our revolution.” [page 70]

Creating a new justice system

As with many governmental functions, the judicial system has had to be rebuilt from scratch. Peace committees seek consensus through dialogue at the commune and neighborhood levels. The goal is rehabilitation rather than punishment. Most cases are settled in peace committees, but felonies and those cases not adjudicated in the peace committees are assigned to district-level people’s courts. There are separate women’s peace committees that handle cases of male violence against women in which all-women panels hand down decisions.

Parallel to these systems of democratic self-activity is the Democratic-Autonomous Administration. This is essentially a dual government, created primarily for foreign governments. Because Rojava’s councils have been ignored elsewhere, the DAA was created so that world’s governments would have a government they could recognize. Each of three Rojava cantons has a DAA, which includes an elected parliament and ministries that are distributed among the various political parties so that each has at least one minister. These, however, rely on the earlier-established council system and work with the councils. The division of labor between the councils and the DAA has yet to be worked out, nor how to reconcile a dual-government structure.

Civil society associations also play large roles in Rojava. These groups perform educational work, organize grassroots activity and place representatives on the councils. Many of these associations are occupation groups. In contrast to what the Kurdish movement sees as the state existing as a means of extracting profits for favored social groups or classes and inculcating a fixation on authority, civil society is substituted for a state. The authors write:

“The Kurdish movement, in its anti-statism, thus draws on [Antonio] Gramsci’s concept of civil society in proposing to strengthen civil society for the purpose of overthrowing the state. In contrast to the abortive Bolshevist strategy of seizing state power, Öcalan posits, like Gramsci on the ideological, political struggle for civil society, a ‘war of position’ beyond military confrontation. Through empowerment, a civil society tries to free itself from the hands of the state and its religious, economic and administrative structures and so to build a counter-hegemony and to activate individual parts of the society to represent civil society in councils and communes.” [pages 122-123]

Economic development on a democratic basis

This democratic concept extends to the economy. Food and fuel prices are controlled, working conditions are negotiated among several interest groups, workers’ rights are defended and the pursuit of profit maximization is blocked to avoid the destructive tendencies of capitalism. The principals of the “communal economy” are described in this way by the Union of Civil Society Associations:

“The state system exploited the society’s labor power and trampled the rights of workers. Under Democratic Autonomy, civil society associations solve problems according to principles of moral politics and an ecological society. The unity of society is the foundation. These associations hold society together. They ensure the unity that is needed to satisfy everyday social needs. Of course, they do this as part of democratic, communal life. They are how society organizes itself.” [page 124]

Rojava, the authors write, was a “quasi-colony” under the Ba’ath régime. There was an enforced agricultural monoculture with no local production allowed. Oil, gas and agricultural products were shipped out, and canned food and finished products from elsewhere shipped in. Not even trees were allowed to be planted. So although there is much productive farmland, Rojava could not come close to self-sufficiency in food as all farmers were forced to raise wheat or cotton. Farming is now being re-oriented toward local needs so that a much higher percentage of food can be produced locally; this is partly a necessity as the area is often blockaded by neighbors.

The city of Qamishli in Syrian Kurdistan

The councils, already in existence, organized the economy to prevent a collapse after Rojava’s liberation. Price controls, measures against hoarding food and medicine, agricultural diversification, planting fruit trees, and building grain mills and industry were implemented and are ongoing projects. Rojava’s economic underdevelopment is seen locally as a disadvantage and an opportunity. It is the latter because, the authors write, it “allows the traditional social collectivism of the Kurdish people to be channeled positively to build a new, alternative economy.” [page 197]

Much of this new economy rests on cooperative enterprises. Cooperatives are required to be connected to the council system; independence is not allowed. Cooperatives work through the economics commissions to meet social needs. Much of this cooperative production is in agriculture or small shops but there are plans to create more industry to meet local needs. Thirty percent of all coop proceeds must be given to local self-government administrations. And this is seen as a route to eliminating unemployment. The authors write:

“The cooperative system is solving the problem of unemployment. ‘Through the communes and cooperatives and the needs-based economy,’ explains [Afrin University chair] Dr. [Ahmad] Yousef, ‘each person can participate in production in his own way, and there will be no unemployment. Where communes are established, it will become clear that unemployment is a result of the capitalist system itself.’ ” [page 206]

Such a system can’t work without an educated population:

“To ensure that society is able to make decisions about the use of water, soil, and energy, information about the society’s needs are taken out of the hands of the experts and socialized. Education is critical for this purpose. ‘We school the people in how cooperatives can form a social economy,’ says [Union of Kurdish Communities leader Cemil] Bayık. ‘We are establishing economics academies to advance this.’ ” [page 207]

Surrounded by a hostile world

All this is at odds not only with the existing institutions and state organizations surrounding them, but with the capitalist powers as well. How can Rojava’s experiment possibly survive in a such a hostile world? The authors of Revolution in Rojava strongly urge the building of Left support sufficiently strong to influence North American and European governments. The people of Rojava, the authors stress, are in need of material support from the West at the same time they are acutely aware of the dangers of a U.S. embrace.

The idea that Rojava’s acceptance of Western aid is a “betrayal” is called “naïve” by the authors, drawing parallels with Republican Spain of the 1930s. Describing Rojava as an “anti-fascist project,” they note that the capitalist West turned its back on the Spanish Revolution, allowing fascism to triumph.

The danger of U.S. material support, of course, can’t be underestimated, given that a communal economy oriented toward people’s needs rather than private profit is anathema to U.S. corporate and government power, which have teamed up to throttle many a revolution attempting to transcend capitalism or simply assert independent development. Moreover, the U.S. wrongly classifies the PKK, which seeks to implement the same system as their fellow Kurds in Syria, as “terrorists” and has long supported Ankara’s scorched-earth repression of Kurds.

In the short term, material support from the West is needed if Rojava is to successfully defend itself from Islamic militants and the Turkish government. Syrian (and Turkish) Kurds, who see their model as one that can be expanded across Syria and the entire Middle East, have their eyes open to the narrowness of the path that must be thread through these contradictions. Nor are their eyes closed to their unsolved problems of pollution, water, waste management, and the stop-gap use of diesel generators that is causing serious environmental problems.

The book ends on an optimistic note, readapting Rosa Luxemburg’s famous phrase to declare the future is “communalism or barbarism.” Although brief discussions of Thomas Jefferson, Luxemburg and Gramsci (who was no opponent of the Bolsheviks) are poorly argued and their views misstated, this is at most a minor irritant in a work ably presenting the first comprehensive study of Rojava’s inspiring experiment in mass-participation democracy. Revolution in Rojava is an excellent introduction to a revolution that is not yet well known but should be.

* Ercan Ayboga. Anja Flach and Michael Knapp (translated by Janet Biehl), Revolution in Rojava: Democratic Autonomy and Women’s Liberation in Syrian Kurdistan [Pluto Books, London 2016]

Building a better movement

All of us who struggle for a better world are disheartened that so many advances of the 20th century have been lost. The mounting crises of the environment, the global economy and ever more constricted political systems are unmistakably moving humanity toward a cliff. And yet social movements, for all the victories here and there, again and again fail to sustain momentum.

Why are we in this predicament? No single person or organization can fully answer such a question, of course, but we do need to seriously reconsider what has been done and how. In this spirit, Marta Harnecker’s “Ideas for the Struggle” is a document that merits wide discussion. Originally written in 2004 and updated this year, the paper consists of 12 short, closely linked sections. And although written with Latin America in mind, the ideas are borderless.

Argentines demonstrate against banks in February 2002 (photo by Usuario:Barcex)

Argentines demonstrate against banks in February 2002 (photo by Usuario:Barcex)

Taking on the idea of spontaneity head on, Ms. Harnecker, a sociologist and activist since the 1960s, opens her paper by declaring that popular uprisings are insufficient in themselves. She writes:

“The recent and not so recent popular uprisings that rocked numerous countries across the world have clearly demonstrated that the initiative of the people, in and of itself, is not enough to defeat ruling regimes. Impoverished urban and rural sectors, lacking a well-defined plan, have risen up, seized highways, towns and neighborhoods, ransacked stores and stormed parliaments, but despite being able to mobilize hundreds of thousands of people, neither their size nor their combativeness have been enough to move from mass uprisings to revolution. They have overthrown presidents, but they have not been able to conquer power and initiate a process of deep social transformations.”

The example of successful revolutions, she argues, demonstrates that a “political instrument” capable of a national struggle is essential. To be effective,

“to convert mass uprisings into revolutions, a political instrument capable of overcoming the dispersion and fragmentation of the exploited and the oppressed is required: one that can create spaces to bring together those who, in spite of their differences, have a common enemy; that is able to strengthen existing struggles and promote others by orientating their actions according to a thorough analysis of the political situation; that can act as an instrument for cohering the many expressions of resistance and struggle.”

The past doesn’t have to be the future

That “political instrument” has to be welded anew and based on current, concrete conditions; people who believe that strong organizations are something to be avoided because many parties of the past engaged in authoritarian or manipulative political practices should not be trapped in the past. She writes:

“I believe it is fundamental for us to overcome this subjective barrier and understand that when we refer to a political instrument, we are not thinking about any political instrument; we are dealing with a political instrument adjusted to the new times, an instrument that we must build together. … We are talking about understanding politics as the art of constructing a social and political force capable of changing the correlation of force in favor of the popular movement, to make possible in the future what today appears impossible. We have to think of politics as the art of constructing forces. We have to overcome the old and deeply-rooted mistake of trying to build a political force without building a social force.”

By “social force,” Ms. Harnecker refers to the multitude of grassroots organizing that takes on particular struggles, including at local levels, and whose autonomy must be respected. A larger organization working on the broader project of building a revolutionary movement can only do so by working with these multitudes of grassroots movements. There can’t be a movement toward a better society without organic movements seeking to transcend the current society. This “construction of forces,” as the author defines this process, has to be conscious work. She writes:

“[T]his construction of forces cannot occur spontaneously; only popular uprisings happen spontaneously. It requires a political instrument that is capable of consciously building the required forces. … I envisage this political instrument as an organization capable of raising a national project that can unify and act as a compass for all those sectors that oppose neoliberalism. As an organization that is orientated towards the rest of society, that respects the autonomy of the social movements instead of manipulating them. And one whose militants and leaders are true popular pedagogues, capable of stimulating the knowledge that exists within the people — derived from their cultural traditions, as well as acquired in their daily struggles for survival — through the fusion of this knowledge with the most all-encompassing knowledge that the political organization can offer.”

Balancing debate with the necessity of action

How should such an organization develop its ideas? In what some readers would likely see as more controversial, Ms. Harnecker argues for democratic centralism. Although a term that is looked on with disfavor due to how the concept was badly distorted in 20th century communist parties, she argues that only through thorough democratic discussion can activists be prepared to carry out work, but that there also has to be strategic action rather than simply debate. She argues:

“This combination of a) a democratic debate at different levels of the organization and b) a single centralized leadership based on whatever agreements are arrived at by consensus or by majority vote is called ‘democratic centralism.’ I do not see how one can conceive of successful political action if unified action is not achieved around key issues. I do not see any other alternative to democratic centralism for achieving this, if consensus cannot [be] reached.

Only a correct combination of centralism and democracy can ensure that agreements are effective, because having engaged in the discussion and the decision-making process, one feels more committed to carry out the decisions.”

That a decision must be made and actions taken based on that decision does not mean an issue is closed in this conception. The minority must be allowed to continue to argue its case because that minority might be right, and if the majority is convinced it is right it should have no fear of further debate, the author writes.

Popular Unity supporters rally in Chile in 1972 (photo via Revista Argentina Siete Días Ilustrados)

Popular Unity supporters rally in Chile in 1972 (photo via Revista Argentina Siete Días Ilustrados)

This is a crucial point. The road to one-person dictatorship began with the stifling of minority viewpoints. As the spaces for debate steadily constricted in the 1920s Soviet Union, it is impossible not to think of Leon Trotsky’s warning that the party would substitute itself for the working class, that a faction of the party would substitute itself for the party and finally a single leader would substitute itself for the faction.

We should never under-estimate the isolation that the Bolshevik Revolution faced, nor the enormous challenges of modernizing a backward country while defending itself against a hostile capitalist world. Nor ignore the huge advances made in a country that went from a 20 percent literacy rate to producing more engineers than any other country in the span of two generations. Nonetheless, the political distortions imposed by first a single-person dictatorship and then a bureaucratic monopoly of power by a single party placed fatal fetters on Soviet development.

People can only solve their problems by freely discussing them, without coercion or manipulation, and then freely acting through coordinated activity based on the results of their discussion. In turn, there must be larger organizations that connect the many particular struggles into a broad movement, one that enables activists to see the links and commonalities between these struggles and the often common enemies that they face.

Confronting capitalist hegemony

None of us possess a blueprint on how to build an effective mass movement. But one thing that ought to be clear, yet often isn’t, is that simply replicating the models of the past is a dead end. To return to Ms. Harnecker’s paper, she argues that no movement can be effective without consideration of capitalist hegemony in opinion manufacturing and the broad acceptance of capitalist rule that hegemony engenders. She writes:

“I am talking about a strategy that takes into consideration the important social, political, economic and cultural transformations that have occurred across the world in the last period. One that understands that the new forms of capitalist domination go far beyond the economic and state sphere, have infiltrated into all the interstices of society — fundamentally through the mass media which has indiscriminately invaded the homes of all social sectors, and in doing so changed the conditions of struggle. … The capitalist elites tend to achieve a significant hegemony over important popular sectors, a real cultural leadership over society; they have the capacity to ideologically subordinate the popular sectors, even those who are exploited by them. As [Noam] Chomsky says, propaganda is to bourgeois democracy what the truncheon is to the totalitarian state.”

Discussion of alternatives to capitalism must become more serious. Not only do social movements need to free themselves of forms of thinking imposed by capitalist hegemony, alternative spaces must be opened and successfully defended:

“[W]e must develop a process of popular construction opposed to capitalism in the territories and spaces won by the left, that seeks to break with the profit logic and the relations this imposes and tries to instill solidarity-based humanist logics. We must promote struggles that are not limited to simple economic demands — although these need to be included — but that advance the development of a more global, social project that encourages authentic levels of power from the grassroots.”

As I noted earlier, the author has written “Ideas for the Struggle” with the experiences of Latin America in mind, and some of the examples she provides are specific to that region. Nonetheless the ideas expressed (of which I have quoted only a very small sample) provides much material for discussion that is pertinent to any country or region. We do need to stop lamenting that we don’t know how to build an effective movement and start seriously discussing how we are going to build an effective movement.

If we don’t, barbarism will be the future. As the world’s resources are depleted, the environment is polluted beyond near-term remediation and ever more people are thrown into desperation — if we go on with capitalism, this is the path humanity will continue to walk — the industrialists and financiers who rule the world will surely have more intensive repression in store for us. If that is not the future we want, we’ll have to change it ourselves.

Cooperatives becoming bigger part of Cuba’s reforms

The continuing debates over cooperatives, including whether they represent a promising form of socialism or a reinforcement of capitalism, will likely have fresh evidence in coming years from Cuba.

The nascent cooperative movement in Cuba is genuine and growing, but many questions about its future direction are yet to be answered. That the Cuban cooperative movement is largely a top-down process, and subject to still opaque decision-making by party and government officials, adds more uncertainty. And inevitably intertwined with these debates are long-standing tensions between traditional state-owned models of property and emerging de-centralized models of cooperative property.

Perhaps the safest observation that can be made today is that nobody knows where Cuba’s experiment will lead.

Sunrise in Havana (photo by Jvlio)

Sunrise in Havana (photo by Jvlio)

The beginning stages of Cuban cooperatives were handled with considerable input. Thousands of meetings were held throughout the country in advance of the Communist Party of Cuba’s Sixth Congress, held in April 2011, to discuss the document Lineamientos de la política económica y social en Cuba (Guidelines on Economic and Social Policy in Cuba), which listed more than 300 goals intended as significant reforms to the Cuban economy. The guidelines approved at the Sixth Congress included autonomy for the state enterprises, an expansion of cooperatives, new taxing laws and changes in the system of subsidies.

Changes came swiftly. Almost 200 occupations previously limited to state enterprises were opened, and within three months of the Sixth Congress, more than 100,000 new small-business licenses were granted. The Cuban government estimated that about 489,000 people, representing nearly a tenth of the workforce, were self-employed in the first half of 2015.

The cooperative sector has not grown as fast, but by October 2013, 270 urban cooperatives had been approved. By late 2014, that number had reached nearly 500. But cooperatives are not new to Cuba — agricultural cooperatives have existed since the early years of the revolution and they produce about 80 percent of the food grown in Cuba. What is new is that cooperatives are now encouraged outside of agriculture, although they are primarily in services rather than manufacturing.

Reversal of previous openness to discussion

The Communist Party had intended to “update” the Guidelines at its Seventh Congress, held in April 2016. But no final documents have been released, nor had the documents to be discussed at the Congress been made available for discussion. This lack of transparency, said to be due to a continuing inability to complete the work, resulted in considerable public disapproval. A commentary in Green Left Weekly, contrasting this lack of transparency with the public input that helped shape the Guidelines approved by the Sixth Congress, noted the party faced a choice of either abandoning public consultation or postponing the congress.

The congress was not postponed. But the party did acknowledge the criticism directed at it. In a March 28 article (shortly before the Congress convened) in Granma, the official party newspaper, the paper wrote:

“The editorial office of this newspaper has received, by various means, expressions of concern from Party members (and non-members, as well) inquiring about the reasons for which, on this occasion, plans were not made for a popular discussion process, similar to that held five years ago regarding the proposed Economic and Social Policy Guidelines of the Party and Revolution.

The fact that such opinions and doubts were expressed is in no way reproachable, much less when they come from people who are genuinely concerned about the work of the Party and the country’s destiny.”

The Granma article argued that the discussions scheduled for the Seventh Congress would be a “continuation” of the work of the Sixth Congress, and that most of the Guidelines were still in the process of being implemented. Therefore, “what is more appropriate is finishing what has begun” rather than opening new discussions. The article argued that:

“[T]he guidelines approved by the 6th Congress serv[e] as the tactical approach to reach our aspirations, reflecting their continuity and development. These documents do not, therefore, represent anything different in terms of the road taken, but rather a higher level expression based on what has been discussed and submitted for consultation to all Party members and the people.”

Responding to criticisms of this line, President Raúl Castro later proposed that the Seventh Congress would adopt any documents “in principal” rather than definitively, promising further public consultation. The Congress did agree, but the documents still have not been released. This delay appears to be due to the drafts still being in progress; one of the documents is reported to have been drafted eight times.

Differing ideas as to direction of reforms

There is a consensus among informed observers that a primary reason for the Communist Party’s slowness in promulgating clear rules for the formation of cooperatives is that the party leadership has yet to reach a consensus itself. The Green Left Weekly commentary mentioned above suggests this division of opinion is behind the delays in producing the updated documents promised for the Seventh Congress. The author, Marce Cameron, wrote:

“The Central Committee’s glacial progress in drafting the two key documents suggests that it has tried to reconcile, behind closed doors, divergent conceptions of the new Cuban socialist model that is aspired to. They had to be reconciled if the leadership were to present a more or less coherent programmatic vision to the party as a whole—rather than strive to involve the party as a whole in developing that vision from the outset over the five years since the 6th Congress.”

In a thoughtful NACLA article, Roger Burbach, basing his analysis on the work of Camila Piñeiro Harnecker, summarized three visions of socialist economic development in Cuba. They are:

  • A statist position, largely reflecting the old guard. Advocates of this position call for more discipline and greater efficiency among state industries and enterprises, and argue that Cuba’s economic problems can be corrected through a more efficient state, not through a dismantling of the state.
  • A market socialist perspective, advanced by many economists. Advocates of a “socialist market economy” argue for privatization, even at the price of increased inequality, the exploitation of wage workers and environmental degradation, as the route to increased productivity and efficiency. These advocates assert the state can always step in to correct excesses.
  • An “autogestionario,” or self-management, stance that calls for democratic and sustainable development primarily through the promotion of cooperatives. Participation, association and solidarity should be at the heart of the new economy, advocates say. In this view, control should not come from the top down but from the bottom up, as workers engage in self-management to further their social and economic concerns.

The so far strong push for cooperatives from the party, and the assistance provided to them, is a good indication that cooperatives will be a part of Cuba’s future. To what degree remains an open question, but however that question is ultimately answered, the intention is that a significant portion of the economy will remain in state hands for the foreseeable future.

No return to capitalism

In a presentation on Cuba cooperatives at the Left Forum in New York last May, Isaac Saney noted that, despite the top-down manner of cooperative creation and the ongoing debate on whether the state should drive the development of cooperatives, popular support remains firm. He gave the example of U.S. President Barack Obama, on his trip to Cuba, saying the U.S. would buy coffee directly from Cuban coops, but the coops condemned that as intended to undermine the socialist state, which they would not go along with.

In the same Left Forum presentation, Al Campbell offered five considerations:

  • Cooperatives tend to build a sense of responsibility for the participants.
  • Coops build collective consciousness.
  • A negative is that coops can develop competition and rivalry with others; structures and practices are necessary to connect coops with the rest of society.
  • The danger of leaving economic coordination to the market; planning is an essential aspect of socialism.
  • Self-determination is a collective process; different decisions must be made by different people.

Parallel to these factors, in a part a reflection of the complex nature of the reforms, is that many cooperative enterprises did not become so on their own initiative. The Left Forum presenters, and others, have interviewed members of cooperatives who, when asked why they became a cooperative, did not know, saying they were told their state enterprise would now be a cooperative. Of 124 non-agricultural cooperatives created by mid-2013, 112 were former state enterprises, according to the Inter Press Service.

Complimentary to the creation of cooperatives, enterprises remaining in state hands are to be given more autonomy. The Inter Press Service reports:

“The authorities have defended ‘social ownership of the basic means of production’ as an essential aspect of the new economic model being built on the basis of reforms outlined by the ‘economic and social policy guidelines’ of the governing Communist Party of Cuba, considered a roadmap for ‘updating’ the socialist system promoted by President Raúl Castro.

In recent legislative debates that touched on this issue, the vice president of the Council of Ministers, Marino Murillo, said the changes underway were aimed at building ‘prosperous and sustainable socialism, in which the main protagonist is the public enterprise, strengthened with greater autonomy in its management and the distribution of its results.’ ”

Cooperatives not necessarily a path to socialism

There is some fear that cooperatives could lead Cuba back to capitalism. Although cooperatives represent a socialized form of production, and potentially can form the basis of a socialist economy based on democratic principles, coops are also completely compatible with capitalism. The formation of cooperatives in itself does not eliminate competition, not even capitalist competition. Locating the cause of greed, injustice, inequality and other social ills in the authoritarian, hierarchical structure of the capitalist enterprise is an overly simplistic analysis.

Co-op symbolAlthough that structure certainly is a factor, the cut-throat nature of unfettered, market-driven competition is central. The relentless pressure to increase profits, maximize market shares and eliminate competition — on pain of enterprise death for those who don’t do this sufficiently — makes unethical or anti-social business decisions inevitable. Putting social decisions in the hands of the capitalist “market” means putting those decisions in the hands of the biggest industrialists and financiers.

What if an economy was dominated by cooperative enterprises, but those coops competed ruthlessly with one another in unfettered market competition? Cooperative members would wind up reducing their own wages (which would be a commodity in such a scenario) and cutting whatever corners they could to survive the competition, just as capitalist enterprises do today. Smaller coops would go under or sell themselves to larger coops — an oligarchy would inevitably arise in most industries.

Working for a cooperative has its advantages, even under capitalism, but even a hugely successful cooperative such as Mondragon faces limits due to the relentless nature of capitalist competition, as the 2013 closing of its household-appliances company, Fagor Electrodomésticos, demonstrates.

An economy based on cooperatives would have to have cooperation between its cooperatives, rather than competition. Prices would have to be negotiated up and down the supply chain (with all enterprises’ financial information available to prevent unfair price-gouging) with perhaps an arbitration board to step in when parties could not agree. Community input would also be desirable, in the industries in which a given community is directly involved and for retail prices of consumer goods.

Cooperative enterprises can be responsible for investment, production and financial decisions — subject to democratic oversight — but might be required to demonstrate full compliance with a range of standards on issues such as equal opportunity, workers’ rights, health and safety, environmental protection and consumer protection. Enterprises could be required to be certified on all relevant issues before conducting business, and perhaps be re-certified at specified intervals.

And of course an economy based on cooperatives does not preclude that certain key industries remain in state hands (with democratic control). Banking, energy and basic utilities such as water come to mind as too important to allow any private control.

Old patterns of hierarchy not eliminated

The foregoing are theoretical constructs for a more developed system. In present-day Cuba, as would any society moving toward a cooperative model, there are many practical questions still to be worked out. There are also growing problems that need to be tackled. Writing in Daily Kos after a trip to Cuba, “Geminijen” observed that hierarchy seemed to stubbornly survive in some coops. She wrote:

“Although the coops are managed by the workers and the workers share the profits, many of the criteria of a coop seemed to be missing or in progress — i.e., there was usually one spokesperson who appeared to be the manager or ‘boss’ or a husband and wife heading up the business (coops are not supposed to be family businesses) and there did not always seem to be a clear path as to how the people who worked there could elect a different manager or board members (they all had elected boards) if they wanted to do so. In some cases, the members were encouraged to participate in the decision-making process, in others not so much.”

Although the writer noted that workers mostly seemed to not mind these conditions because they were making more money and had a say in pay scales, nonetheless inequality is a potential problem. In examining why “self-organized” forms of private enterprise approved by the state seemed more successful than state-run coops,

“[W]e didn’t consider that the state coops were hampered by their lack of access to raw materials necessary to create the coops. As a visiting Puerto Rican educational scholar pointed out to me, the privately organized coops have come in and taken over the failed state coops because they have the money (capital) to develop the business that the state run coops do not. When I asked self-organized coops where they got their capital, they were often evasive. My source suggested that many of these businesses were started with money from remittances from wealthy relatives in the United States. She also noted that since most of the wealthy people living in the States are white, this ability of one group of Cubans to obtain and invest capital not only was reintroducing class divisions, but increasing the divisions again between the races since most Afro Cubans did not have access to remittances.”

The Cuban government is making efforts to assist the coops created from state enterprises. Earlier this year, the government announced that restaurants and some other ex-state enterprises would be able to buy products at reduced prices from wholesale operations to be established for them, along with a tax cut, in exchange for price controls. Construction cooperatives are also hampered by inconsistent access to supplies and the sometimes poor condition of equipment inherited from state companies.

Cubans not looking north for answers

Forming a cooperative from scratch can still be difficult. There are heavy barriers, a Cuban anarchist visiting New York earlier this year reported in a presentation — approval is needed from the government, and there is no time period in which a response must be made. Political resistance remains; the presenter reported that his group was told to take down a banner saying “socialism is democracy” while participating in a parade, although they refused to do so. He is also fearful that Cuba is headed toward the model of China and Vietnam — a capitalist direction that he disapproved of.

Concomitantly, his biggest fear was of genetically modified organisms and other ills pouring into Cuba from the United States. Although there is a widespread desire among Cubans to be rid of the U.S. blockade that has done so much damage to their country, there is little desire for Cuba to revert to capitalism.

Daniel Hellinger, writing of the increased incomes but widening class divisions resulting from the reforms, reports that Cubans are firm in seeking to defend their gains. In a report written after a two-month stay in Havana, he wrote:

“They unfailingly welcome change — so long as three major accomplishments of the revolution are left untouched. No one wants a future without free, quality universal health care; free, quality education; and the peace of mind that comes with streets that are virtually free of crime or violence at any hour of the day or night. Moreover, while Cubans clearly welcome the thaw in relations, they are not looking to the U.S. to save them. Virtually everyone who talked to me seemed to agree with the government’s approach to rectifying problems; where they disagreed was over the pace of change, with most hoping to see it speed up, but more than a few anxious about their jobs, rations, pensions, etc.”

The Cuban government has consistently said it intends its reforms as a renewal of socialism, not a retreat. An objective accounting of the old Soviet model of centralized control with state ownership of all means of production has to acknowledge the disadvantages that come with it, along with the accompanying political constrictions. Change came too late, too haltingly and too much on the backs of working people in the Soviet Union, factors that can’t be ignored in assessing why the Soviet Union crumbled.

Cuba is a different country, but does face the problems of centralization. To the leadership’s credit, it is making a bonafide effort to effect necessary change, even if that change is yet to be agreed upon. It is much too early to say where Cuba’s experiment in cooperatives will lead, but the surest guarantee that it will prove to be an advance and not a retreat is the Cuban people themselves, who have stood up to unceasing U.S. attacks for more than a half-century.

Working collectively beats working for a boss

Cooperative enterprises are more stable than conventional capitalist enterprises, are more productive and create jobs that are more sustainable. And although the temptation to see coops as a magical solution to the ills of capitalism should be resisted, that they are better for workers than top-down enterprises shouldn’t be any surprise.

The better performance of cooperative enterprises, and the better results for workers, than that of traditionally run capitalist enterprises was recently summarized by the organization Co-operatives UK in its report, “What do we really know about worker co-operatives?” Written by Virginie Pérotin, the report analyzed international data on worker-owned and -run businesses in Europe, the U.S. and Latin America and compared the results with conventional businesses.

Moreover, the report said, conventional enterprises have something to learn from cooperatives: “in several industries, conventional companies would produce more with their current levels of employment and capital if they behaved like employee-owned firms.” Setting aside the unlikelihood of capitalists suddenly deciding to cede control and/or share profits, the preceding quote only makes sense. Why wouldn’t we be more productive if we were working for ourselves and had a say in the running of the business rather than toiling within the traditional concept of having to accept orders from above by people who have no interest other than squeezing as much out of you as possible?

Les Mees Cereal Food Cooperative PAD in France (photo by JPS68)

Les Mees Cereal Food Cooperative PAD in France (photo by JPS68)

The Co-operatives UK report defined a worker co-operative as an enterprise in which all or most of the capital is owned by employees (members) whether individually and/or collectively; all categories of employees can become members; most employees are members; in accordance with international co-operative principles, members each have one vote, regardless of the amount of capital they have invested in the business; and members vote on strategic issues in annual general meetings and elect the chief executive officer. Law firms were excluded because only some lawyers can be partners nor can any support staff.

The main findings of the report are:

  • Worker co-operatives are larger than conventional businesses and not necessarily less capital-intensive.
  • Worker co-operatives survive at least as long as other businesses and have more stable employment.
  • Worker cooperatives are more productive than conventional businesses, with staff working “better and smarter” and production organized more efficiently.
  • Worker co-operatives retain a larger share of their profits than other business models.
  • Executive and non-executive pay differentials are much narrower in worker co-operatives than in other firms.

More productive and more stable

There are benefits not only for the workers of the cooperative, but also for the local community:

“Labour-managed firms are probably more productive and may preserve jobs better in recessions than conventional firms, creating more sustainable jobs. Promoting worker co-operatives could therefore improve local communities’ employment, and therefore health and social expenditure and tax revenue. …

Employee control is thought to increase productivity, and in a labour-managed firm adjusting pay to preserve jobs makes sense for the employee-owners. Worker-members make the decision to adjust pay and they get the future profits (whereas it is more difficult for a conventional firm to elicit employees’ agreement for pay cuts in exchange for job preservation, since the firm’s owners have an incentive not to increase pay when business recovers).”

And certainly no cooperative is going to vote to ship itself thousands of miles away to a low-wage haven!

Interestingly, perhaps because the example of the factory takeovers in Argentina come readily to mind, cooperatives are more commonly formed from scratch, rather than as rescues of failing enterprises. In France, for example, 84 percent of worker cooperatives started from scratch with only seven percent a rescue of a failing conventional firm during the years 1997 to 2001, whereas in the same period, 64 percent of all firms started from scratch and 20 percent as a rescue of a failing conventional firm.

A significant reason for that is undoubtedly government support. The French and Italian governments provide support for cooperatives and this accounts for the relatively higher number of coops in those two countries. The Co-operatives UK report estimates Italy has at least 25,000 coops, France has 2,600 and Spain has 17,000, compared to only 500 to 600 in Britain.

Government support for coops in France and Italy

During the last years of the 2000s, about 200 new enterprises joined France’s national federation of cooperatives (Société coopérative et participative, or SCOP) annually, and the numbers continue to grow. According to Co-operative News, three-quarters of French coops remain in business after three years, while only two-thirds of French businesses overall last that long. The French government directly provides assistance:

“[W]orker co-operatives receive tax benefits from the French government. SCOPs do not have to pay the professional tax, which is 1.5% to 2.5% of revenues and income on worker shares is exempt from income taxes. There are also financial mechanisms for workers to use redundancy payments as part of wider financing package to buy-out and provide cash-flow for the business once they take it over.”

The federation also provides financing for capital needs through its own financial institution. Financing is also available for cooperatives in Italy.

The taken-over Zanón ceramics factory, now known as FaSinPat, or Factory Without a Boss (photo by Guglielmo Celata)

The taken-over Zanón ceramics factory, now known as FaSinPat, or Factory Without a Boss (photo by Guglielmo Celata)

The formation and sustainability of cooperatives in Italy are facilitated by the country’s Marcora Law. One aspect of this law is that laid-off workers can elect to have their unemployment paid in a lump sum to be used toward the formation of a cooperative, in conjunction with a minimum number of similarly situated workers. Cooperative members have technical assistance and financing available to them through a mutual fund run by cooperatives, to which all coops in turn contribute 3 percent of their net income. There are also banks that specialize in servicing cooperatives on advantageous terms.

The stability of coops in turn provides stability to the communities in which they operate, notes Co-operative News in a report on Italy’s Marcora Law:

“But beyond the economic and employment policies, the social dimension should not be underestimated: co-operation, by nature, is inextricably linked to geographical territory and, therefore, the re-launch of a business is almost always the re-launch of an important contribution to the economic regeneration of the area in which the enterprise operates; the assets of the business continues to be indivisible and inter-generational, which helps link the co-operative with its social reality.”

Continued survival in Uruguay

In Uruguay, mutual aid cooperatives have a long history — housing cooperatives began to be formed in 1966, with a rapid increase in them after the passage of the National Housing Act in 1968. These were suppressed during the years of military dictatorship in the 1970s and 1980s.

Worker-run cooperative enterprises constitute a tiny percentage of the economy in Uruguay. There was, however, a significant expansion in their numbers following a deep economic downturn there in 2002 and they have since gained some government support from the Frente Amplio government. These are often successful. A study finds that cooperatives have survival rates one-third above other enterprises. The study’s author, Gabriel Burdín, writes:

“[S]urvey evidence … in Uruguay indicates that [worker-managed firms] employ less supervisors compared with [conventional firms], rely more on mutual monitoring among co-workers and are more likely to introduce organizational innovations such as team work, quality groups, job rotation and consultation mechanisms.”

In Argentina, workers’ cooperatives were formed as acts of survival.

An organizer at the Zanón factory that is often seen as an exemplary model, Raúl Godoy, speaking at a Left Forum panel organized by Left Voice, told the audience of the long years of organizing necessary to have made the takeover possible. Even after the fall of Argentina’s military dictatorship, blacklists were maintained by employers during the era of formal democracy, and the Zanón factory had a “very harsh regime” for workers. Mr. Godoy reported that organizing had to be done “in almost conspiratorial fashion” outside the factory.

The Zanón activists built relationships with workers fighting in other places; sought to defend the rights of workers; built relationships with “picateros” (organized unemployed people who frequently use direct-action tactics), Mapuches, women and other workers; and did “important militant work that involved building confidence.” Thus when the factory was to be closed and the workers had to occupy it, and physically defend themselves from expulsion, they were able to be cohesive and to count on the assistance of the surrounding community.

The limits of the possible in Argentina

Although forming a cooperative was not necessarily their desired outcome, it represented what was possible at the time. Mr. Godoy told the Left Voice panel:

“There is no individual escape from the capitalist situation. We did not have the power to go beyond the cooperative form. It was the way we could maintain what we had accomplished.”

Argentine authorities have never been supportive of the recovered factories, and the new neoliberal government of Mauricio Macri has quickly slowed itself openly hostile to them. Thus Argentina’s cooperatives face a challenging future. “There is no solution within the capitalist system,” Mr. Godoy said.

Co-op symbolNonetheless, Argentine cooperatives have provided a demonstration of worker-run enterprises forging strong links with their communities, with mutual benefit to the enterprise and the community that supports the enterprise. The employees doing so first had to overcome their own doubts about themselves, but were able to draw on the experience of those who went first and created national organizations to represent the cooperatives and enable coordination among them.

It is no so simple matter for working people to acquire the confidence to run businesses themselves; pervasive capitalist ideology insists the businesses can only be run by a small elite, who are therefore entitled to collect hundreds or even thousands of times more in compensation than their employees. Yet how could any business function without the know-how and cooperation of its workforce?

That the working conditions within cooperatives are superior to traditional top-down enterprises is simply common sense. But cooperatives are small islands in a vast sea of capitalism, and can’t escape the pull of capitalist markets, no matter how humane an internal culture might be. Cooperatives in themselves don’t necessarily herald a coming socialist dawn; they are quite compatible with capitalism.

Cooperating with cooperatives

Even if cooperatives were to become the dominant enterprise model, that by itself would not eliminate competition. To create a truly new, better system, in an economy based on cooperatives, the cooperatives would have to cooperate with each other in a system with democratic accountability. (This does not preclude that certain key industries, such as banking, would be in state hands under democratic control.)

An alternative to capitalist markets would have to be devised — such an alternative would have to be based on local input with all interested parties involved. Such an alternative would have to be able to determine demand, ensure sufficient supply, allow for fair pricing throughout the supply chain, and be flexible enough to enable changes in the conditions of any factor, or multiple factors, to be accounted for in a reasonably timely and appropriate fashion.

For now, however, cooperatives must compete with capitalist enterprises with all the rigors of capitalist markets. Not even the world’s most successful cooperative, Mondragon, is exempt from this. That cooperatives tend to cut wages rather or dip into reserves rather than lay off workers, with an eye toward future better times in which pay cuts can be made up, may be more humane, but it also reflects that a cooperative enterprise that must compete is eventually forced to treat its own wages as a commodity.

If an economy is based on cooperatives, but those cooperatives compete against each other, the cooperative members will become their own capitalists and be forced to cut their wages to survive competition.

The intention here isn’t to pour cold water on the idea of cooperatives — they have tremendous value in demonstrating that working people don’t need bosses and that it is not necessary to work long hours for little pay so that a few people at the top can amass fortunes. The profits divided between industrialists and financiers derive from the difference in the value of what you produce from what you are paid.

Shouldn’t the people who do the work earn the benefits? Shouldn’t communities have stability instead of being subjected to the whims of far-off corporate bosses? In a better world, they would be.

The forgotten workers’ control movement of Prague Spring

At the time of the [August 1968] Soviet invasion [of Czechoslovakia], two months after the first workers’ councils were formed, there were perhaps fewer than two dozen of them, although these were concentrated in the largest enterprises and therefore represented a large number of employees. But the movement took off, and by January 1969 there were councils in about 120 enterprises, representing more than 800,000 employees, or about one-sixth of the country’s workers. This occurred despite a new mood of discouragement from the government from October 1968.

From the beginning, this was a grassroots movement from below that forced party, government, and enterprise managements to react. The councils designed their own statutes and implemented them from the start. The draft statutes for the Wilhelm Pieck Factory in Prague (one of the first, created in June 1968) provide a good example. “The workers of the W. Pieck factory (CKD Prague) wish to fulfill one of the fundamental rights of socialist democracy, namely the right of the workers to manage their own factory,” the introduction to the statutes stated. “They also desire a closer bond between the interests of the whole society and the interests of each individual. To this end, they have decided to establish workers’ self-management.”

Prague (photo by Beentree)

Prague (photo by Beentree)

All employees working for at least three months, except the director, were eligible to participate, and the employees as a whole, called the “workers’ assembly,” was the highest body and would make all fundamental decisions. In turn, the assembly would elect the workers’ council to carry out the decisions of the whole, manage the plant and hire the director. Council members would serve in staggered terms, be elected in secret balloting and be recallable. The director was to be chosen after an examination of each candidate conducted by a body composed of a majority of employees and a minority from outside organizations.

A director is the top manager, equivalent to the chief executive officer of a capitalist corporation. The workers’ council would be the equivalent of a board of directors in a capitalist corporation that has shares traded on a stock market. This supervisory role, however, would be radically different: The workers’ council would be made up of workers acting in the interest of their fellow workers and, in theory, with the greater good of society in mind as well.

By contrast, in a capitalist corporation listed on a stock market, the board of directors is made up of top executives of the company, the chief executive officer’s cronies, executives from other corporations in which there is an alignment of interests, and perhaps a celebrity or two, and the board of directors has a duty only to the holders of the corporation’s stock. Although this duty to stockholders is strong enough in some countries to be written into legal statutes, the ownership of the stock is spread among so many that the board will often act in the interest of that top management, which translates to the least possible unencumbered transfer of wealth upward. But in cases where the board of directors does uphold its legal duty and governs in the interest of the holders of the stock, this duty simply means maximizing the price of the stock by any means necessary, not excepting mass layoffs, wage reductions and the taking away of employee benefits. Either way, the capitalist company is governed against the interests of its workforce (whose collective efforts are the source of the profits), and by law must be.

National meeting sought to codify statutes

The Wilhelm Pieck Factory statutes were similar to statutes produced in other enterprises that were creating workers’ councils. It was only logical for a national federation of councils to be formed to coordinate their work and for economic activity to have a relation to the larger societal interest. Ahead of a government deadline to produce national legislation codifying the councils, a general meeting of workers’ councils took place on 9 and 10 January 1969 in Plzeň, one of the most important industrial cities in Czechoslovakia (perhaps best known internationally for its famous beers). A 104-page report left behind a good record of the meeting (it was also tape-recorded); representatives from across the Czech Lands and Slovakia convened to provide the views of the councils to assist in the preparation of the national law.

Trade union leaders were among the participants in the meeting, and backed the complementary roles of the unions and the councils. (Trade unions, as noted earlier, convened two-thirds of the councils.) One of the first speakers, an engineer who was the chair of his trade union local in Plzeň, said a division of tasks was a natural development: “For us, the establishment of workers’ councils implies that we will be able to achieve a status of relative independence for the enterprise, that the decision-making power will be separated from executive powers, that the trade unions will have a free hand to carry out their own specific policies, that progress is made towards a solution of the problem of the producers’ relationship to their production, i.e., we are beginning to solve the problem of alienation.”

Some 190 enterprises were represented at this meeting, including 101 workers’ councils and 61 preparatory committees for the creation of councils; the remainder were trade union or other types of committees. The meeting concluded with the unanimous passage of a six-point resolution, including “the right to self-management as an inalienable right of the socialist producer.”

The resolution declared,

“We are convinced that workers’ councils can help to humanize both the work and relationships within the enterprise, and give to each producer a proper feeling that he is not just an employee, a mere working element in the production process, but also the organizer and joint creator of this process. This is why we wish to re-emphasize here and now that the councils must always preserve their democratic character and their vital links with their electors, thus preventing a special caste of ‘professional self-management executives’ from forming.”

That democratic character, and the popularity of the concept, is demonstrated in the mass participation—a survey of 95 councils found that 83 percent of employees had participated in council elections. A considerable study was undertaken of these 95 councils, representing manufacturing and other sectors, and an interesting trend emerged from the data in the high level of experience embodied in elected council members. About three-quarters of those elected to councils had been in their workplaces for more than ten years, and mostly more than 15 years. More than 70 percent of council members were technicians or engineers, about one-quarter were manual workers and only 5 percent were from administrative staffs. These results represent a strong degree of voting for the perceived best candidates rather than employees simply voting for their friends or for candidates like themselves—because the council movement was particularly strong in manufacturing sectors, most of those voting for council members were manual workers.

These results demonstrated a high level of political maturity on the part of Czechoslovak workers. Another clue to this seriousness is that 29 percent of those elected to councils had a university education, possibly a higher average level of education than was then possessed by directors. Many directors in the past had been put into their positions through political connections, and a desire to revolt against sometimes amateurish management played a part in the council movement. Interesting, too, is that about half the council members were also Communist Party members. Czechoslovak workers continued to believe in socialism while rejecting the imposed Soviet-style system.

Government sought to water down workers’ control

The government did write a legislative bill, copies of which circulated in January 1969, but the bill was never introduced as Soviet pressure on the Czechoslovak party leadership intensified and hard-liners began to assert themselves. The bill would have changed the name of workers’ councils to enterprise councils and watered down some of the statutes that had been codified by the councils themselves. These pullbacks included a proposed state veto on the selection of enterprise directors, that one-fifth of enterprise councils be made up of unelected outside specialists, and that the councils of what the bill refers to as “state enterprises” (banks, railroads and other entities that would remain directly controlled by the government) could have only a minority of members elected by employees and allow a government veto of council decisions.

This proposed backtracking was met with opposition. The trade union daily newspaper, Práce, in a February commentary, and a federal trade union congress, in March, both called the government bill “the minimum acceptable.” In a Práce commentary, an engineer and council activist, Rudolf Slánský Jr. (son of the executed party leader), put the council movement in the context of the question of enterprise ownership.

“The management of our nation’s economy is one of the crucial problems,” Slánský wrote.

“The basic economic principle on which the bureaucratic-centralist management mechanism rests is the direct exercise of the ownership functions of nationalized industry. The state, or more precisely various central organs of the state, assume this task. It is almost unnecessary to remind the reader of one of the principal lessons of Marxism, namely he who has property has power…The only possible method of transforming the bureaucratic-administrative model of our socialist society into a democratic model is to abolish the monopoly of the state administration over the exercise of ownership functions, and to decentralize it towards those whose interest lies in the functioning of the socialist enterprise, i.e. the collectives of enterprise workers.”

Addressing bureaucrats who objected to a lessening of central control, Slánský wrote,

“[T]hese people like to confuse certain concepts. They say, for example, that this law would mean transforming social property as a whole into group property, even though it is clearly not a question of property, but rather one of knowing who is exercising property rights in the name of the whole society, whether it is the state apparatus or the socialist producers directly, i.e. the enterprise collectives.”

Nonetheless, there is tension between the tasks of oversight and of day-to-day management. A different commentator, a law professor, declared,

“We must not…set up democracy and technical competence as opposites, but search for a harmonious balance between these two components…It would perhaps be better not to talk of a transfer of functions but rather a transfer of tasks. It will then be necessary for the appropriate transfer to be dictated by needs, rather than by reasons of dogma or prestige.”

These discussions had no opportunity to develop. In April 1969, Alexander Dubček was forced out as party first secretary, replaced by Gustáv Husák, who wasted little time before inaugurating repression. The legislative bill was shelved in May, and government and party officials began a campaign against councils. The government formally banned workers’ councils in July 1970, but by then they were already disappearing.

This is an excerpt from It’s Not Over: Learning From the Socialist Experiment, published by Zero Books. Citations omitted. The omitted sources cited in this excerpt are: Robert Vitak, “Workers Control: The Czechoslovak Experience,” Socialist Register, 1971; Oldřich Kyn, “The Rise and Fall of the Economic Reform in Czechoslovakia,” American Economic Review, May 1970; and several articles anthologized in Vladimir Fišera, Workers’ Councils in Czechoslovakia: Documents and Essays 1968-69 [St. Martin’s Press, 1978]

What might a cooperative economy look like?

In any country in which a model of worker cooperation or self-management (in which enterprises are run collectively and with an eye on benefiting the community) is the predominant model, there would need to be regulations to augment good will. Constitutional guarantees would be necessary as well. Some industries are simply much larger than others. In a complex, industrialized society, some enterprises are going to be much larger than others. Minimizing the problems that would derive from size imbalances would be a constant concern.

Furthermore, if enterprises are run on a cooperative basis, then it is only logical that relations among enterprises should also be run on a cooperative basis. An alternative to capitalist markets would have to be devised—such an alternative would have to be based on local input with all interested parties involved. Such an alternative would have to be able to determine demand, ensure sufficient supply, allow for fair pricing throughout the supply chain, and be flexible enough to enable changes in the conditions of any factor, or multiple factors, to be accounted for in a reasonably timely and appropriate fashion.

Central planning in a hierarchal command structure with little or no local input proved to not be a long-term viable alternative system. What of tight regulation? That is not a solution, either. Regulators, similar to central planners, can never possess sufficient knowledge to adequately perform their job and local enterprises can use their special knowledge to give themselves an advantage rather than share that knowledge with regulators.

Responsibility, then, would have to be tied to overall society. Negotiations among suppliers and buyers to determine prices, to determine distribution and a host of other issues would be necessary. Such negotiations are already common in certain industries; for example in the chemical industry, where companies negotiate commodity prices on a monthly or quarterly basis. Those are competitive negotiations in which the dominant position oscillates between buyer and supplier, resulting in dramatic price changes.

In a cooperative economy, negotiations would be done in a far more cooperative manner, with a wider group participating in the discussions. In this model, prices of raw materials, component parts, semi-finished goods, finished goods, consumer products and producer products such as machinery would be negotiated up and down the supply chain, leading to a rationalization of prices—markups to create artificially high profits or pricing below cost to undercut competitors would be unsustainable in a system where prices are negotiated and pricing information is widely available.

These would have to be fair negotiations—prices throughout the supply chain would have to be set with an eye on rational economics. Industry facilitators to assist negotiations and/or a government arbitration board to make decisions when parties are unable to agree to terms might be necessary. Community input would also be desirable, in the industries in which a given community is directly involved and for retail prices of consumer goods. It may be desirable to include these community interests in pricing negotiations directly. As more people take on more responsibility, more will gain the experience of fair negotiations, enabling more to peer over the shoulders of those involved in these decisions. In turn, more experience means more people within the community who can shoulder responsibility.

Regulating social standards

Although regulation, as noted above, is not in itself a solution, that is not a suggestion that regulation should be done away with. One method of using regulation to ensure socially positive economic activity might be a system of certification. Enterprises would be responsible for investment, production and financial decisions, but might be required to demonstrate full compliance with a range of standards on issues such as equal opportunity, workers’ rights, health and safety, environmental protection and consumer protection. Enterprises could be required to be certified on all relevant issues before conducting business, and perhaps be re-certified at specified intervals.

The allusion to “workers’ rights” in the preceding paragraph might seem a bit odd. These are enterprises under workers’ control already, so what rights are contemplated? That is a more specific question than can reasonably be answered in all situations ahead of time, but in large enterprises workers might still need protections codified in the laws covering the governance of enterprises. In the Czechoslovakia of Prague Spring, as we saw in Chapter 3, this issue was directly confronted. There, the enterprises were under state ownership, and no change was contemplated to that status—enterprises were to be managed directly by their employees on behalf of the country and its people. Activists had begun to set up (until the Soviet occupation stopped it) a system of workers’ councils as the instruments through which enterprises would be directed by all the employees.

Although these have a similar name, they should not be confused with the councils and soviets set up in 1917 and 1918 across Europe; these councils were enterprise-management bodies, not alternative government bodies. The Czechoslovak workers’ councils were designed to give the entire workforce of an enterprise a say in management and would also send representatives to national conventions that would coordinate production at the national level. These councils were to exist simultaneously with trade unions, which would represent the same workers as employees. The activists, mostly trade unionists and grassroots Communist Party members who worked in these factories, believed that separate organizations were necessary to represent workers properly in both their roles because there are potential conflicts between being a member of an organization and an individual worker.

Socialist triangleIn a country where capitalism has been transcended, and a new system of social control and democracy is being established, employees in those large enterprises that are to be formally owned by the state will have the same dual role of managing the enterprise collectively at the same time they remain workers. It is not impossible that biases or favoritism could slowly arise in such enterprises; a union would provide another source of protection that could defend a worker as an individual when necessary. Trade union membership, then, would remain a social value to be respected.

Workers in enterprises that are collectively owned, since they would be owners and not simply managers, might find less ambiguity between their two roles, as long as strategic decisions are made collectively. Still, it may be that there remains a place for trade unions even in these types of enterprises, or it could be that unionization is simply a social value and all members of the enterprise join or form a union for reasons of social solidarity or to provide another check against any centralizing tendencies emerging within the enterprise or within government.

Open information for social accountability

A system of democratic control and social accountability would require open information. Records and accounts of all enterprises and major production units of enterprises would have to be made available to all other parties to negotiations in order for the fairest deals to be reached and to prevent attempts to unfairly benefit at the expense of suppliers or customers. Social-justice organizations—such as those upholding civil rights, consumer rights or the environment—should also have a role, perhaps in enterprise negotiations when appropriate, but more likely in helping to set social goals, in monitoring compliance with standards and possibly being the bodies that issue certifications to enterprises that achieve the standards.

Some amount of planning and coordination would be necessary as part of the process of determining raw materials needs and ensuring that those needs are met. Any planning committee would have to be democratically controlled and have wide social representation to oversee production and to assist in the determination of investment needs.

Co-op symbolInvestment would need to go to where it is needed, a determination made with as many inputs as possible, but because of its importance banking is one area that would have to be in state hands and not in collectives. Financial speculation must be definitively ended, with banking reduced to a public utility. Enterprises seeking loans to finance expansions or other projects will have to prove their case, but should have access to investment funds if a body of decision-makers, which like all other bodies would be as inclusive as possible, agrees that the project is socially useful or necessary.

Government infrastructure projects should be subject to the same parameters as enterprises, with the added proviso that the people in the affected area have the right to make their voices heard in meaningful ways on local political bodies and on any other appropriate public boards. No private developer wielding power through vast accumulations of money will be able to destroy forests or neighborhoods to build a project designed for the developer to reap profits while the community is degraded. Development would be controlled through democratic processes at local levels, and regional or national infrastructure projects should require input from local bodies representing all affected areas.

Capitalist ideology holds that the single-person management that goes with private ownership produces the most efficient system, and soon after the October Revolution communist leadership agreed that single-person management is best. But in contrast to these “givens,” is it not true that a content workforce able to have control over its working life will produce better than a workforce that is alienated by a lack of control? Studies consistently conclude that measures of workers’ control increase satisfaction in work, productivity and solidarity. But workers’ control threatens the domination of elites.

An unprecedented level of democracy would be possible in a cooperative economy because the power of capital would be broken. Social constraints ensuring responsibility to the larger community would be required to prevent the accumulation of capital that translates into power, although such tendencies would be countered by a system that rewards cooperation rather than greed. The society that has been sketched out in these very broad strokes is a society with no classes. Working people—the overwhelming majority of society—have taken control. The (ex-)capitalists are just as free to go to work as everybody else. When the power of capital is abolished, capitalists are converted into ordinary people. Surely some, those with expertise and an ability to work well with others, would be among those cooperative members elected into administrative positions; regardless, they would have to become regular cooperative workers, contributing to the production of a quality product or service and having their say equal to all others who do the work.

This is an excerpt from It’s Not Over: Learning From the Socialist Experiment, published by Zero Books. Citations omitted. Sources cited in this excerpt are: Pat Devine, “Self-Governing Socialism,” anthologized in William K. Tabb (ed.), The Future of Socialism: Perspectives from the Left [Monthly Review Press, 1990]; Diane Elson, “Socializing Markets, Not Market Socialism,” The Socialist Register, 2000; and Herbert Gintis, “The Nature of Labor Exchange and the Theory of Capitalist Production,” anthologized in Randy Albelda, Christopher Gunn and William Waller (eds.), Alternatives to Economic Orthodoxy, [M.E. Sharpe, 1987]