Cooperatives and Sustainability: A radical alternative?

Words by Himath Siriniwasa

This article is part of PULPCLIMATE week. CLICK HERE to join the facebook group. University of Sydney Students will be marching from Fischer Library at 10:00 AM on the 20th of September.

There are plenty of good reasons to be skeptical of market-based solutions to climate change. Firstly, they work uncomfortably too well with the hegemonic narrative of neoliberal social justice. This tells us to centre our struggles in changing the voices and makeup of big corporations, so that they change their marketing strategies to appear ‘woke’.  Secondly, production for profit appears to be at the centre of this mess. With 100 corporations responsible for 71% of global emissions, this concern seems far from justified. Lastly, questions of urgency are at the forefront of environmental justice. We are undoubtedly in the face of a climate emergency – small fines for big polluters aren’t going to cut it.  

I’m not going to deny the full force of this criticism. We have to do what we can to offset the climate crisis immediately. State-intervention, national planning and public ownership may be a worthwhile strategy to look into. What next? In a pluralist, democratic approach to dealing with the issue at hand, I believe that worker cooperatives can play a large role in both mitigating the damage done and providing a long-term green alternative. 

Worker cooperatives are worker-owned, self-managed enterprises in which workers participate in democratic decision-making. As a firm, it participates in a market economy on basic market principles – exchange, money and price formation. What makes cooperatives differ from other ‘market-based’ solutions to the climate catastrophe is the structure of the firm and production. While production is still geared for profit, they are useful only in as much as they benefit the worker-owners. As such, this mitigates the caustic impact of exponential growth we see in capitalist economies. This is as cooperatives face more barriers for expansion than traditional firms. Importantly, they can’t purchase wage labour at low-costs indiscriminately – each new worker divides earnings by a larger number. Furthermore, large-scale expansion in the style of capitalist firms requires top-down hierarchical management, e.g. when Starbucks opens a new store on the orders of  higher management. In a cooperative, any new operation will be necessarily self-governing, which could itself be its own cooperative, making expansion non-profitable and unnecessary. 

Cooperatives are firmly rooted in communities – business does not exist where the workers are not. While a conventional firm’s management team may decide to dump toxic waste in the factories near where the worker’s reside, it’s in the self interest of cooperative worker-owners to not do so. Thereby, even for the first-year Microeconomics student interested in small scale firms and perfect competition, cooperatives are an attractive alternative for environmentally friendly, Pareto-optimal economic outcomes. For the anti-capitalist, the absence of employers and bosses, egalitarian distribution of wealth and the democratic control of the enterprise are similarly exciting prospects in fostering worker control over the means of production. 

Currently, cooperatives are already playing an essential role in the transition to alternative energy consumption. Given that new businesses are required to provide this, it’s neither necessary nor desirable that we recreate the hallmarks of corporate capitalism in a thinly green veneer. Protection of worker’s rights, self-management, economic democracy and equitable distribution of wealth are not to be overlooked when we envision a green future. To do so, as mentioned earlier, reeks of neoliberal social justice. Moreover, as a study in the journal Sustainability notes, there is large-scale statistical evidence for the importance of cooperatives in energy transition schemes world-wide. In envisaging an alternate future, it is important that there are tried and tested methods of democratic, egalitarian firms that are already on the ground implementing a zero carbon economy. 

In the transportation industry, co-operatives worldwide are implementing measures to reduce consumption of fossil fuels. In Vancouver, car-sharing cooperative Modo allows members to access cars when they need them, avoiding the high costs and environmental damage of individual car ownership. More impressive is the Union Cab worker co-op in Wisconsin, which offers car services running on hybrid vehicles that avoids the mass exploitation of workers we see in counterparts such as Uber. Mondragon, an iconoclast large cooperative enterprise in the Basque region of Spain makes important contributions to the cooperative energy industry by designing and manufacturing systems for the extensive automated production of photovoltaic cells for solar technology. 

In Australia, the Earthworker Cooperative is manufacturing solar hot-water technology in completely worker-run factories. Their aims realise the core values of Climate strike, in their mission statement committing themselves to a just transition away from fossil fuels, democratic job creation and affordable renewable energy options for households. Moreover, they assign a set proportion of their surplus to go to social justice projections. This includes working with First Nations communities to support Indigienous economic empowerment in the creation of community based worker-cooperatives. 

Some anti-capitalists may object that inasmuch as worker cooperatives are a market institution, they do not provide long term economic and environmental justice. After all, the market is held by socialist and capitalists alike to be the central feature of the capitalist economic system, for better or for worse. To this response, I point out that capitalism is more than a market-economy, rather one dominated by the private, inegalitarian ownership of capital by a select few. In her recent book Code of Capital, Katherina Pistor characterises capitalism as “a market economy in which some assets [namely land and debt] are placed on legal steroids” for the private accumulation of wealth. Cooperatives provide a third way in the tired private vs public control debates by focusing on what matters – worker ownership. Instead of relegating such tasks to government intervention, firms like the Earthworker Cooperative and Mondragon provide quality child-care, health services, education facilities and family support themselves. Worker-owned enterprises will by nature, or by democratic decree, tend to support community and family welfare.

From classical liberal thinker John Stuart Mill, to arch-Communist Vladimir Lenin, cooperatives were envisaged in being central to a future free from worker exploitation. As people from broad political backgrounds unite to fight anthropogenic climate catastrophe, perhaps the cross-spectrum support for cooperatives can provide ideas for an egalitarian, solidaristic future.