Are Co Ops a form of Capitalism?

[Petrol Bomb]

So I was just browsing the 'Define Capitalism' thread yesterday, when a question arose into my head. Are Cooperatives a form of Capitalism?

I'll start out by sharing what the definitions for Capitalism were given on that page. They generally went along the lines of:

- Bourgeois class privately owns means of production.
- Proletarians who do not own means of production sell their labour to the bourgeoisie, in the form of wage-labour, a fixed salary.
- Bourgeois class makes a profit by exploiting the proletarians, by selling the labour in the form of a commodity and not paying them the full value of their labour.

So here is the difference I see between the above and Cooperatives:

- Workers collectively own the means of production.
- Workers put in labour, and the amount of labour directly affects their earnings, because the money made is divided up equally among the workers who own the means of production collectively.
- Workers make a profit by selling their commodities or service.

So from here I have two questions:

1. The original, is the latter also a form of Capitalism?

2. In the second situation, would the term, 'profit' even apply? Because in the first situation, the profit is the surplus after paying production costs, and the worker's salary, which would go to the bourgeois, who put in no labour. I think in the second situation you would be earning your labour's worth.

[G4b3n]

1. It depends the socioeconomic system in which the cooperatives exists, the cooperatives are institutions and do not independently constitute an economic system. If the cooperatives produce and distribute in a free access economy within voluntary autonomous communities then this is probably a form of Anarchist communism in which no 'profit' is being made. Use value is essentially being produced from use value.

2. If the cooperative is distributing goods in a market context and is claiming ownership of the means of production independently of the community in which it exists then they very well could produce profit, it doesn't necessarily mean they are going to though. However, most leftists who advocate for the establishment of cooperatives also advocate for free access systems or a transitional period which will end in a free access system.

[hatzel]

There are actually many issues here. If we were to take your summary of the definition of capitalism (and it's a historically accepted definition, even if this does not necessarily imply that it is adequate), we rightly notice that coops cannot simply be called capitalistic. That is to say, if capitalism is defined exclusively by the class relationships at the moment of production and the extraction of surplus value (that is to say exploitation in the traditional Marxist sense), coops must be seen as something different, to a lesser or greater degree. This does not mean that they are radically outside of capitalism, however; they operate in the same sphere of distribution as unambiguously capitalist firms (that is to say the market), and as such could well be accused of participating in the reproduction of the capitalist order.

There are two options, then (though these options are by no means mutually exclusive). The first is to redefine capitalism itself. If we look at those who float around value-form theory and the anti-work milieu, we may well find that capitalism is not so much to do with class relations at the moment of production, but is the generalisation of proletarian labour, which (believe it or not) does not necessarily even need a bourgeoisie to perpetuate itself. In such a situation, one could (justifiably?) argue that coops are as capitalistic as any other firm, as their employees/members/workers are as proletarian as anybody else, though even this could be questioned - perhaps they are in fact petit-bourgeois? Even if this is the case, however, their labour could still be called proletarian, or 'mediated by the value-form' or however else you want to express that idea.

The second option is a 'queering' of the economy. I hope you will understand why I choose to refer to it in this way. In such case, it becomes difficult to call the economy unambiguously capitalist, and this distinguishing between capitalistic businesses and non-capitalistic coops (or capitalism and non-capitalism full stop) becomes somewhat less pressing an issue (as, coincidentally, does the question of whether coop members are proletarian or petit-bourgeois). There is certainly much in favour of this kind of understanding; the various steps between a farmer's sheep and the ball of yarn I may have just bought from the shop almost certainly take place within a capitalist sphere, though my knitting it into a scarf - a form of production - and (if we pretend for a moment that I am so kind) giving it to you as a birthday present - a form of distribution - are arguably economic (though even this depends on how we understand the word economic. Interestingly enough, both capitalist and anticapitalist positions tend to equate 'economic' with 'capitalistic,' thereby excluding these kinds of processes, though coming from more of an anthropological background that an economic one, I am by no means inclined to do so), though hardly mediated by capital/ism at all, and taking place outside of the reaches of the market, profit, exploitation, proletarian labour etc. This does not necessarily mean that my knitting a scarf or a cooperative scarf factory producing them industrially are non-capitalistic endeavours, only that the line of division between capitalistic and anti-capitalistic economies isn't a line at all, but more of a continuum, whereby the claim that we live in a capitalistic monolith of a socio-economy becomes one which is open to debate.

Perhaps the point I am trying to communicate here is that the existence of the coop and its relationship to a broader capitalist order could perhaps prompt us to either redefine capitalism or reconsider the nature of the economy itself...

[tuwix]

Are Cooperatives a form of Capitalism?


It depends on form of cooperative and environment in which it works. Cooperative can be egalitarian or structural. Many states care to obstruct creating egalitarian cooperatives enforcing a creation of structure (director, board, etc.) And if there is a CEO who has the power to fire anyone he wants, the cooperative has nothing to do with socialism. But when cooperative make in voting every decision, it has very much to do with socialism. From other side when cooperative works in capitalist environment, capitalist system enforces it to make actions as other capitalist enterprise

[Dave B]

We could ask Karl and answer is as below; but within that are some 19th century conjectures and partially unfulfilled speculation that needs elaboration I think .


Capital Vol. III Part V Division of Profit into Interest and Profit of Enterprise. Interest-Bearing Capital Chapter 27. The Role of Credit in Capitalist Production




The co-operative factories of the labourers themselves represent within the old form the first sprouts of the new, although they naturally reproduce, and must reproduce, everywhere in their actual organisation all the shortcomings of the prevailing system. But the antithesis between capital and labour is overcome within them, if at first only by way of making the associated labourers into their own capitalist, i.e., by enabling them to use the means of production for the employment of their own labour. They show how a new mode of production naturally grows out of an old one, when the development of the material forces of production and of the corresponding forms of social production have reached a particular stage.

Without the factory system arising out of the capitalist mode of production there could have been no co-operative factories. Nor could these have developed without the credit system arising out of the same mode of production. The credit system is not only the principal basis for the gradual transformation of capitalist private enterprises into capitalist stock companies, but equally offers the means for the gradual extension of co-operative enterprises on a more or less national scale. The capitalist stock companies, as much as the co-operative factories, should be considered as transitional forms from the capitalist mode of production to the associated one, with the only distinction that the antagonism is resolved negatively in the one and positively in the other.

http://www.marxists.org/archive/marx/works/1894-c3/ch27.htm

There was speculation or anticipation that the co-operative system might/could/would become more prevalent within capitalism as workers ‘would’ borrow money to purchase manufacturing capital to be run as co-operatives. The surplus value would still go the money capitalists as interest to be paid on the borrowed money

This was based on the expectation of the concentration of ownership of capital into fewer and fewer hands and that the capitalist class would tend to become even more parasitical, lazy and socially useless in opting out of even the supervision of production itself by becoming pure interest bearing money capitalists.

A tendency that they saw paralleled in the joint stock company system where the capitalists, the shareholders, played no part in the production process which was or would be organised only by salaried workers.

Leading to a situation where paid workers would run the whole system from top to bottom and the capitalist class would become so alienated from their own productive capital that they wouldn’t even know where it was let alone what it did.




And as elsewhere in volume III this ‘commercial labour’ that the capitalist class formerly unfortunately had to perform themselves would be done by paid labour ‘mass produced’ by the ‘public education system’ eg the universities.

So that the capitalist class then have absolutely nothing to do even for themselves.

Following in the well trodden path of the feudal aristocracy who at least originally had a social function.


And by extension the same analysis applied to nationalisation and state capitalism, where the recipients of surplus value from the collectivised capital of the national capitalist class would go to them.

Eg, taken to the extreme, the nomenclatura of Bolshevik state capitalism.

If developed to its full extent and all production was then run and organised by workers be it co-operatives running on loaned money capital, state capitalist enterprises or joint stock companies run by workers. Then the ‘technical’ conditions would be in place for the working class to merely ‘politically’ decide to stop handing over surplus value to the capitalist class.

And capitalism would be at an end on the stroke of a democratic pen.

Ironically it is probably not easy to comprehend the 19th century view as to some extent the prediction has been validated.

In the 19th century a lot of capitalist still ran their own capitalist enterprises eg Bradley Hardacre.

http://en.wikipedia.org/wiki/Brass_(TV_series)

It is best put by Fred I think thus;

Anti-Dühring by Frederick Engels 1877 Part III: Socialism II. Theoretical




…..the transformation of the great establishments for production and distribution into joint-stock companies and state property shows how unnecessary the bourgeoisie are for that purpose. All the social functions of the capitalist are now performed by salaried employees. The capitalist has no further social function than that of pocketing dividends, tearing off coupons, and gambling on the Stock Exchange, where the different capitalists despoil one another of their capital. At first the capitalist mode of production forces out the workers. Now it forces out the capitalists, and reduces them, just as it reduced the workers, to the ranks of the surplus population, although not immediately into those of the industrial reserve army.

But the transformation, either into joint-stock companies, or into state ownership, does not do away with the capitalistic nature of the productive forces. In the joint-stock companies this is obvious. And the modern state, again, is only the organisation that bourgeois society takes on in order to support the general external conditions of the capitalist mode of production against the encroachments as well of the workers as of individual capitalists. The modern state, no matter what its form, is essentially a capitalist machine, the state of the capitalists, the ideal personification of the total national capital. The more it proceeds to the taking over of productive forces, the more does it actually become the national capitalist, the more citizens does it exploit. The workers remain wage-workers — proletarians. The capitalist relation is not done away with. It is rather brought to a head. But, brought to a head, it topples over. State ownership of the productive forces is not the solution of the conflict, but concealed within it are the technical conditions that form the elements of that solution.


http://www.marxists.org/archive/marx/works/1877/anti-duhring/ch24.htm

Actually Duhring was into the idea of federation of co-operatives and much of the 2nd half of anti-duhring is an attack on that, little appreciated I think.

Burnham/ Milovan Đilas took the idea forward with the notion that those salaried workers who ran the ‘capitalist’ system would displace the orthodox capitalist class as a new (ruling) class.

[Sotionov]

Are Cooperatives a form of Capitalism?
If slaveless plantations are forms of slaveownership, then sure, they are.

[Rafiq]

If slaveless plantations are forms of slaveownership, then sure, they are.

Except capitalism isn't exclusively defined by the administrative provisions of the workplace. Co ops are petite bourgeois, it is very simple to understand.

[jookyle]

Co-ops are capitalist. A co-op still functions with in a capitalist system and still uses the profit incentive for producing/providing a service. Co-ops simply create consumerism with conditions.

[MarxArchist]

If they produce commodities for sale to profit on the market yes. If worker run "fields facories and workshops" are in competition with capitalist owned companies than yes. Much of the exploitative conditions workers experience are created via competition in the market. Commodity production in general is a capitalist relation. People can't just create a bunch of co-ops and make "communism" within the framework of capitalism.

[Sotionov]

Except capitalism isn't exclusively defined by the administrative provisions of the workplace.
Capitalism is defined primarily by the employer-employee relation, just like slavery was by slave-slaveowner and feudalism by feudalist-serf relation. One can also be a capitalist without having employees (by renting money or other property) but neither type of capitalist is present in workers' cooperatives.


Co ops are petite bourgeois, it is very simple to understand.It is very simple to understand that there is no such thing. There are two classes- the laborer class and the rulling class that oppress and exploit them. If laborers own their means of production (like some peasants and artisans) but don't oppress or exploit anyone- they're laborers just like all the other laborers.


Co-ops are capitalist. A co-op still functions with in a capitalist system and still uses the profit incentive for producing/providing a service.
So, if I were to live in a slave society and work a plantation without any slaves in the picture- I'm still a slaveowner because I function within a slave system. Note that is saying that I am a slaveowner, even though I don't own or use any slaves. It is obviously nonsensical. Likewise, it is equally nonsensical to call worker coops capitalist, being that no one in those firms is a capitalist.


If they produce commodities for sale to profit on the market yes.
Sorry, commodity production doesn't constitute capitalism, even Marx knew that.