Small and medium sized businesses used to be the backbone of regional economies. Once upon a time, most everyone worked in one. In San Miguel de Allende, most businesses are small ones. Successful historic preservation of the town center has kept the chains of multinationals at bay. But neoliberal government policies have privatized state owned assets around the world, raised interest rates world-wide pushing small businesses into bankuptcy, and lifted restraints on foreign ownership. The resulting purchase of state owned assets and locally owned businesses by multinational firms is not surprising. In fact, it is the goal of government policies. And where once large businesses bought up small businesses – often selling off their assets and laying off the workers – now huge multinational firms simply drive small businesses out of business. Many communities resist the establishment of a Walmart, Home Depot or a Costco in their neighborhood because all the local businesses sooner or later close down.
Worker-owned businesses, or coops, have three primary characteristics: collective ownership of the business including the land, internal democracy based on one-member one-vote, and sharing profits and losses. Collective ownership insures that larger businesses cannot buy out the smaller business – or at least not without a majority vote of all members of the coop. Internal democracy keeps up morale. Sharing profits and losses keeps everyone doing their best to keep the business competitive, productive and successful.
Chains of multinational corporations can force small businesses into bankruptcy. Yet, cooperatives have shown that they can resist even the competition of the huge chains. For example, in Amherst MA , a cooperative photocopy shop (Collective Copy) drove a Kinko’s out of town. Customer loyalty is important, as is the personal service provided by a non-alienated workforce. But because there is no single owner or class of owners absorbing huge amounts of surplus, coops can successfully compete with larger firms. Many studies have shown that cooperatives that combine all three characteristics of coops are more competitive and productive than any other business model. It’s simply not true that huge multinationals are more productive and competitive. This means that we can successfully challenge Walmart.
This is very important. We can chose between genetically modified, highly processed food with little nutritional value or we can organize a food coop and get the food we want. We can buy clothes made in a cooperative like Mujeres Productoras here in San Miguel. We can buy books from a cooperatively owned and run bookstore (for example Food for Thought in Amherst MA). With our purchases, we can support businesses in which workers learn democratic skills, are treated well, and make enough money to survive. Imagine a world where people wake-up and are happy to go to work instead of dreading the drudgery of an exploitative workplace!
Sometimes the huge chains do have lower sticker prices. But when we turn the label over, we see that the product was made in China or Indonesia, most likely in a sweat shop. Do we really want to save a dime if it means the producer is working in slave-like conditions? When we shop at Walmart, we know that the owners are some of the wealthiest people in the world. We know that the employees are very badly paid and have few or no benefits such as health care and retirement pensions. Do we want to save a dime at the expense of the person ringing-up our purchase? ( The average full-time Wal-Mart employee is paid only about $17,000 a year. The company’s health care plan covers fewer than half of its workers. Last year Scott Lee Jr., Wal-Mart’s chief executive, was paid $17.5 million. “That is, every two weeks Mr. Lee was paid about as much as his average employee will earn in a lifetime.” Paul Krugman, New York Times, 5/13/05. http://www.nytimes.com/2005/05/13/opinion/13krugman.html)
It’s our choice. There are alternatives. And where they are lacking, we can create them.