California Co-op Conference 2013

The California Co-op Conference on April 5 & 6 on Wilshire Blvd.  in Los Angeles will celebrate cooperatives by sharing successes and providing the most effective ways to help strengthen and expand the cooperative movement.

Workshops will reveal how cooperatives revitalize and fortify local economies by creating jobs, housing, and locally owned businesses.  Attendees will learn how to start a new cooperative and how to develop and to strengthen their own cooperatives.  The conference offers an opportunity to engage with other cooperators and discuss ideas, experiences, and strategies. More information about the workshops including schedules can be found here.

The cost is around $200, depending on how soon you register. Check it out.

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Part V: Notes on a visit to the Mondragon worker-owner cooperative, Sept. 2012

By David and Lila Tresemer (www.MountainSeas.com.au and http://www.DavidandLilaTresemer.com)

Now for some observations outside of the congratulations for their successful economic model. We would like to speak about spiritual forces. David asked one of the managers, “As your movement was begun by a Catholic priest (Arizmendiarriete), did the success of this movement bring people to the Church?” Answer: “Yes, though many belonged to the Church already. But that has ended. Now only the elderly attend Church, except for funerals, when other people come. Now half of the weddings are in the Church, and half are ‘social.’” “Social” meant outside the Church in a public setting, where the focus is on …#2 in our list at the beginning of these notes. Mondragon has changed the old Biblical polarity “you can’t serve two masters, and must choose between God (spirit) and Mammon (money).” That comes from Gospel of Matthew Chapter 6, verse 24. The polarity has become Labor (humanity) versus Money.

After this visit to Mondragon and this conversation, I view this now as a three-some:

1. LABOR – Humanity – what we do with our time, our energy, our work, and our attention. The highest value here is freedom of expression. Work is meant to benefit and enhance a sane world.

2.MONEY– as capital. If you watch money closely, you realize that it functions as an a-moral force. It simply seeks places to grow, no matter what the method – organic food and weapons are only differentiated by their ability to make more money. The characterization in the Bible of money as expressing a negative spirit – Mammon – becomes clearer when you spend time at gatherings of investors, as David occasionally does. The values there are on clearing away all regulations that have been put into place in order to protect Humanity, in order for Money to grow more freely. You can understand these conferences as servants of money. The hyper-rich think that they control money, and occasionally realize that they are the servants to money. Mondragon realizes this and insists that “money is not the master – it is the tool.” The way they do this is through cooperatives, that is, the Labor factor above.

3. SPIRIT. When you begin to understand that there is a spirit of humanity and that there is a spirit of money, you look for the greater spiritual force behind the context for all of this. Call it Gaia, or call it Mother Mary, or call it The Virgin, or call it Jesus, or call it any number of things – and then ask what are the values of that Greater Picture, that includes the earth (#4 in our original list). Don’t settle for claims of spiritual prominence by holy wars, which are demonic spirits working with money to suppress Humanity.

We realized the importance of spirit near the end of our visit when we suddenly “woke up,” so to speak, from participation in the tour – hearing speakers, taking tours of buildings and factories, talking with people, etc. – to seeing our surroundings. A key piece came from one of the translators, who said, “People from Mondragon can easily work in China or Brazil for three months or more, if they see it as temporary. However, if you ask them to move their home from one Basque valley across the hills into another Basque valley, it is quite difficult for them to do.” Aha – we looked around us and could easily sense what we had missed before – the power of an angelic presence, what some people recognize as Spirit of Place, or the archangel who acts as the Folk Soul – and especially powerful here. When you see that the cooperative movement arises to ensure the connection of people with their community and PLACE, and you realize that the angel (or archangel) or that PLACE assists in the cooperative initiatives, you get a very different sense of how exportable this idea might be. For creating a successful cooperative is not just about applying a step-wise installation manual. It requires great clarity about the support you’re getting from your community, your geographical place, and your archangel.

Even if you can’t “see” archangels, you can sense these presences. We tested the waters with our group for conversation about this sort of thing and found soon that this was not territory in which others had much experience. Or they were shy, an unfortunate by-product of the monopoly that extreme religion has created on talk about Spirit.

I also wondered about congruency. Here are people working for years, building up a good retirement fund, and then there’s that last day that they leave the factory. Several people mentioned that they don’t look back. But if they were building or creating something congruent to their culture that they’re protecting, then you would find the elders hanging around the centers of production, just because they had a passion for it. It seems that the elders don’t come back to visit the factories for washing machines. Then I wondered, “Are washing machines congruent with any culture? In fact, aren’t they actually congruent with every culture – in that everyone in a ‘developed country’ uses washing machines? Or… is there a way that they could become more congruent?” These are outstanding questions at the end of our journey.

Rudolf Steiner recommended a three-fold social organization that included:

THINKING – the sphere of culture and ideas, where the key word is freedom of expression, and the currency streams from ideas.

FEELING – the social or middle sphere of political rights, what Mondragon has cultivated in the ownership by workers of their production, and their rights in voting in their cooperatives. The key word here is equality, and the currency streams from the heart.

WILLING – the economic sphere where the key word is brotherhood/sisterhood, working together for the common good. The currency can be money, though more truthfully the currency is human energy employed in work towards a goal.

Mondragon has been very successful, though imperfectly as they admit, in realizing a balance of these three.

As we watch the imbalances in the several models that we presented, in the primacy of OWNERS in Part I and the primacy of MONEY in this Part V, we see that this experiment in human organization has much to recommend it, and we wish it great success – both in the valleys of the Basque country and the other places in the world where it’s being tried.

End of notes from our trip of September 2012

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Part IV. Notes on a visit to the Mondragon worker-owner cooperative, September 2012

by David and Lila Tresemer (www.MountainSeas.com.au and http://www.DavidandLilaTresemer.com)

We were a bit surprised when we attended the university to discover how little they understood about history, culture and context. Mondragon may face the challenge of being too isolated from world affairs and awareness of global concerns outside their own geography. One of the members of our visiting group said that the first response to this system in the United States would be, “Oh, that’s just Marxist,” with the subtext that it’s communist and will take away your rights and make your life more miserable. Actually, in Mondragon the high value on freedom underpins the whole system – freedom from the whims of overpaid executives at big companies. However, we understood how this knee-jerk reaction of “Marxist!” would occur.

So we asked a student, “How do you respond to criticism that this system of cooperatives is Marxist?”

The student looked puzzled, “Who?”

“Karl Marx,” we said, “social theorist of the 19th century?”

Blank look.

We asked further, “Do they teach about Karl Marx or the philosophy of the relation of labor and capital?” The student shook her head, “Sorry, I haven’t heard of him, and no they don’t.”

Unbelieving that these students hadn’t been prepared to respond to the criticism of “Marxist!,” we asked three more students. Same thing. They had never heard of him, or any of the other philosophers who have wrestled with these questions. They simply thought that the worker-owner cooperative ideology stood on its own.

We realize that one’s philosophy of work has to be governed by your sense of “where is this leading?” It seems that the western ideal pictures a rise to the high echelons of the corporate world, bonuses of stock options and baskets of money – then a private jet, a gated mansion in a gated community likely in the Caribbean, with staff who are not uppity because they come from a poor neighborhood and can easily be replaced. The ideal and goal of Mondragon is to ensure a vibrant and healthy community of human beings putting their efforts into work that provides their families with an adequate income while producing a product useful to other people in the world.

The question: “Is it possible to have a people-focused structure that can be competitive and resilient?” Mondragon answers, “Yes!”

Tours of interested people are now coming from all over the world. Because, no matter what the reactions are – “Marxist!” or “Hidden Capitalist!” – this system creates jobs, maintains jobs, and solidifies whole communities.

We may have gotten some of our facts incorrect, and there are plenty of other facts to learn about their systems. Several managers repeated, “This isn’t paradise, and we’re not perfect,” same words, which suggests that the central group devised this response to criticism. What they have is not paradise, but very hopeful.

More in the last part, Part V.

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Next Trip to Mondragon and a New One to Bologna, Italy

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By: Georgia Kelly, Director of the Praxis Peace Institute

Dear Praxis Friends

Many of you have asked about Mondragón and whether we are doing another trip this year. We are, and the dates have been set.
 
Mondragón Cooperatives Seminar & Tour
 
September 8 – 14, 2013 – Mondragón, Spain
This seminar and tour offers an in-depth experience of the most successful consortium of cooperatives in the world.  Praxis Peace Institute has organized 4 seminars in Mondragon and this one will be the fifth. Each one has been a little different because at Mondragón, they are always improving, always responding to the needs of worker-owners, always anticipating the moves needed to maintain the 0% unemployment level that is their commitment and achievement. If you have been thinking about participating in one of these seminars, hesitate no longer! This is an extraordinary opportunity to experience viable and inspiring alternatives to corporate capitalism.
Program ends in the afternoon of Sept. 13th.
Details of these seminar and tour are on the Praxis website: http://www.praxispeace.org
Click on the link in the Mondragón Project area.
 
Deposits are not required this early, but by March 1, 2013, you can secure your place by making a $500 deposit. If the euro/dollar exchange rate does  not change much, the prices should remain the same as last year.
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Just Added! – Bologna, Italy
 
Praxis Seminar & Tour of Cooperatives in the Emilia Romagna region
 
September 16 – 22, 2013
Program begins with a reception on the evening of Sept. 16th.
This year, for the first time, Praxis Peace Institute is organizing a seminar and tour of the cooperatives in the Emilia Romagna region of Italy. We will be headquartered in Bologna, Italy and stay at a hotel that is walking distance to the University of Bologna where our seminars will be held. Our seminars will be conducted by world renown Italian economists who specialize in cooperatives and socially-just economic practices and models.
The tours of worker-owned businesses in the region will include a ceramics factory, an industrial coop, a coop umbrella organization, a social coop, and other businesses. We will learn how the coops are organized, the unique economics of Emilia Romagna region, their banks, and the role of the coops in the time of recession.
Our hotel is located in the center of Bologna, about one-and-a-half blocks to the university where our seminars are held. It’s within easy walking distance of many excellent restaurants and cafes. Bologna is centrally located in Italy. Florence is a 35 minutes by train, and Venice is a little less than one-and-a-half hours by train. So, it is easy to add on these two cities to your trip.
Information will be posted on our website soon, but this is an early announcement to Praxis members and people who have participated in our previous Mondragón seminar/tour.
IMPORTANT! Both groups are limited to 24 people each. The price for this seminar will be slightly higher than the Mondragón seminar.
Prices for both seminars will be announced by February 1, 2013
A $500 deposit will hold your place in either seminar. And, we have an excellent travel agent that gets the best deals and coordinates our arrival times.
Georgia Kelly, Director
Praxis Peace Institute
P.O. Box 523, Sonoma, CA 95476
707-939-2973
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A Visit to the Women’s Prison in Chino with AVP, December 2012

As a co-facilitator of the Alternatives to Violence Project (AVP), I spent a weekend with a group of inmates at the CIW (California Institution for Women) in Chino. Chino has three levels of housing for 2500-2600 inmates (with almost 800 staff). Eleven women plus three of us “outside facilitators” and three “inside facilitators” spent two and a half days together experiencing the AVP basic program, which is the first of three levels before one may become a co-facilitator.

Upon entering the prison lobby, we presented our I.D. and went through a metal detector, having avoided wearing metal (no jeans or bras—except sports bras). Also forbidden were clothing of certain colors as well as carrying anything in with us besides lunch, an I.D., and basic items such as a comb and car key. The main facilitator wheeled in a couple of boxes of pens, paper, markers, posters, and other paraphernalia. Accompanied by a prison employee assigned to escort us, we crossed a large grassy area to a building where classes, activities, and workshops are held. So far the grounds were reminiscent of a campus, it seemed to me. Of course, I wasn’t able to see the dorms.

In another post I’ve described the AVP “curriculum,” so I’d like to focus on the women I met—anonymously and generally, of course, so as not to violate confidentiality. First, I was struck by their nationality. Six of the eleven were Anglo, three were black, and two or three were Latina. I hadn’t expected so many whites. Whether they represented the racial makeup of the prison or whether they had self-selected, I’m not sure.

Another surprise was how many seemed middle class in their looks, comportment, and diction. (A couple of women seemed less educated with rougher speech. But I want to avoid stereotypes.) I had expected a lower educational level. The years they were serving and the months or years that remained to be served varied but we did have at least one lifer, and two that were leaving within a few months.

Family was extremely important to the inmates as could be seen by how often they mentioned family members. Some of them had familial support and visits; some were cut off by their families. Most had children whom they missed and worried about.

Another surprise was the amount and quality of rehabilitative programs at the prison, which may help explain why the women seemed so mature, articulate, and even wise! The following programs and more take place there: Prison Puppy Program (training puppies to be assigned to veterans with PTSD), drug treatment (AA, etc.), forestry/camp training (to fight forest fires, etc.), computers, high school diploma/GED, literacy, basic education, clothing and textile manufacturing, construction. One of our inside facilitators even gave me handouts about their Restorative Justice group. (Restorative Justice consists of prisoners and victims meeting face to face to arrive at some common understanding and restitution by the inmate—or the accused, if it occurs before a trial.) We learned that the inmates were grateful for all the programs offered and took full advantage of them, even to the point of exhaustion at times. One woman said it was “better” than being outside and having to drive from one program to another, which point of view I took with a grain of salt.

On Saturday we ate dinner in the cafeteria—not a good experience for me. Inmates lined up outside in switchbacks as if in “stockades” (their word). Upon entering they received trays, one at a time, through a slot in the wall. Tables were metal circles with uncomfortable, semi-circular, metal “benches” bolted to them. By the time another inmate and I found a free spot in the huge and deafening room, our food had cooled. Dinner consisted of tacos with rice and beans. Not so bad if it had been hot. “Ice cream” cups for dessert, but it didn’t look or taste like ice cream. Dinner was to be eaten quickly. We AVP “outside” folks had been instructed to bring our own plastic spoons (but no forks or knives, of course). Except for this one meal, courtesy of the prison, we brought our own lunches and Friday-night dinner and drinks in plastic containers and ate them in the workshop room.

I found myself laughing and crying the whole weekend as all of us—the facilitators too, in conformity with the AVP process—shared our feelings and experiences. As the weekend progressed we bonded with one another (the women had been drawn from different dorms). As fascinating as it was, our weekend was emotionally and physically draining. We didn’t get back to our motel before 9 p.m. on Friday and Saturday nights, and had to rise at 5 a.m. to have breakfast at a café across the street before entering the prison and setting up. We didn’t leave until mid-Sunday afternoon. (I slept ten hours the first night after getting home.)

As we grew to feel more comfortable,  the inmates revealed other things about their prison experience. According to them there are many frustrations. They have trouble getting through the bureaucracy to receive and send mail and packages. They are susceptible to “drops” at any time if there is a crisis such as an attempted escape. During such times they have to immediately sit on the ground and stay in one spot whether sun or rain or cold or ants. Lights are turned out at set times, and “bunkees” are assigned with little regard for compatibility, sometimes leading to violence, especially since the rooms are tiny (according to an inmate), with just a bunk bed, toilet, and small metal desk welded into the wall. There’s no Internet access, although there is a library.

One woman told us that if an inmate is the victim of theft, the entire dormitory is subjected to a thorough search. Prison personnel rifle through every item of the women’s personal property in the search for an item which common sense would suggest to me had long since been smuggled out to a friend in another dorm.

It became clear that basic needs such as freedom to control your life and time, freedom of space and movement, dignity—all of these are lacking. Prison is not the place one wants to be, despite a plethora of programs, for which the prison management must be congratulated and respected.

With all these programs, I doubt that there is much recidivism of the inmates of this institution, although I have no statistics regarding this. The resilience of the inmates, their acceptance of responsibility, and their eagerness to take advantage of the many programs to improve and transform their lives—all this I found remarkable and moving.

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Part III: Notes on a visit to the Mondragon worker-owner cooperative

By David and Lila Tresemer (www.MountainSeas.com.au and http://www.DavidandLilaTresemer.com)

Management at Mondragon has the job of figuring out what the world marketplace is doing. Fagor, their big factory, makes clothes washing machines (and other things) in big factories with lots of moving parts and expensive equipment. Our guide said that, “In ten years, all of these kinds of things will be made in Africa and Asia. It’s our job to figure out what will be needed in the future, and begin retooling our factories now.” He said that it requires a 500,000 Euro investment to create one job in a foundry. That’s 50 million Euros for 100 jobs. It requires a 200,000 Euro investment to create one service job (without so much expensive equipment). When you look at how an investment might be made redundant in a short time period, you hesitate to make that investment!

To repeat, tensions exist in competition with other manufacturers.  The Mondragon cooperatives are islands of cooperation in a sea of world-wide competition.

The system of governance in the cooperative gives more power to the individual.  Thus there is an expectation that the individual is educated about the company, and motivated for best interests of the company rather than solely for their personal welfare.

As a result, during these times they have been known to vote to take salary cuts of up to 12%, keeping everyone employed, as that is the highest value.

Brief history of their founding: In the 1930’s the Basque valleys could not be reached easily as the roads were poor. The Basque language was unlike Spanish or French. The Spanish government cut them off from many services. Poverty was rampant. A Catholic priest assigned to them, Jose Maria Arizmendiarrieta – sometimes called Arizmendi (Ah-rees-MEN-dee) for short – determined to assist their development. He began with five people who shared his values, and began a school to train them in technical matters. Soon after they began constructing clothes washing machines and electrical heaters. It took years to form other cooperatives, start their own bank, etc. – the long slow growth curve that begins horizontal and now has gone near vertical.

Arizmendiarrieta means oak (ariz), mountain (mendi), place of stones (arrieta). He put in years of hard work to organize the people in the Basque country, beginning in Assarte (Mondragon), Spain. Some quips from him: “To democratize power, we must socialize knowledge.” Thus shows his emphasis on education that continues to this day. “The ideas you don’t put into practice are only reflections.” Thus his emphasis on actions. “Your savings or your suitcase.” – meaning either put your money into the new bank that they were starting, or leave town.

Values are generally different: They value the best interest of the Whole, rather than promote the supremacy of the individual. They take care of each other, and help find employment for another coop member if his or her job becomes redundant.

Cooperative of cooperatives (120 of them altogether): Once in that group, they consider their main task is to keep all employed. They move people around as market conditions change.

Some details:

  • In Spain you must employ handicapped people for 2.5% of your workforce or give 2.5% of your profits to funds that support the handicapped. Mondragon has chosen the first, and they are happy at how this has made their companies more diverse and interesting, and responsive to the communities in which they live.
  • Unemployment in Spain 40% (or higher). Unemployment in the cooperatives 0%.
  • Taxes on companies in Basque country: 28.6% of profit. However, if you are a coop and you have a 10% Education Fund and at least a 20% Reserve Fund (Mondragon averages 45% for the Reserve Fund) and at least 80% of your workers are members of the coop, your taxes to Spain are 10%.
  • The bank, Caja Laboral, spends 40.60 Euros to get 100 Euros in profit, compared to the usual expenditure of 50 Euros. Their delinquency rate is 5% (vs. other banks 9%). They have 1.2 million clients.
  • They have a rule for change: 25% of their products should be new every four years.

To become a member, it costs $15000 euros, plus 3-year (or is it one? – my notes are not clear on this point) trial period of provisional membership (the worker is paid during this time)—to be sure there is alignment all around. They currently have 84,000 members in the Basque region and 15,000 throughout other parts of Spain and the world.

Some problems in our view:

  • They don’t address their own food production for their area. Their businesses are primarily for export, such as clothes washing machines to go all over the world.
  • The factories are big, metallic and lonely (not really different from anywhere else).
  • They currently focus on manufacturing as their business (washing machines, solar panels, …) which puts them at the mercy of international markets where the rules are quite different, e.g., low wages in Asia.

In many places in the world, workers don’t want to share in the risk of the enterprise. Coops aren’t for everyone. But they do provide a model for cooperation at its best in regards to a community taking care of their own. The ideal of a group of people pooling their time, energy, money, and ideas to make something work is terrific. It contrasts with people who say, “Just give me a job. I don’t care what I do. If I don’t like it, I can drop out and get welfare.”

Coops aren’t the total answer, but they go a long way towards improving the situation for workers.

More in the next Part IV.

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Part II: Notes on a visit to the Mondragon Worker-Owner Coops

Guest blog by David and Lila Tresemer, September 2012 (www.MountainSeas.com.au and http://www.DavidandLilaTresemer.com)

A 600-person committee oversees the entirety of the 120 cooperatives. If business is failing in one sector of their businesses, instead of laying off workers from those cooperatives, they strive to find employment for those workers in cooperatives in other sectors that are doing all right. The entire 100,000-person workforce is looking after itself by ensuring employment for everyone. Imagine those meetings of 600 people trying to manage their 100,000 members effectively. Prior to the Global Financial Crisis and its second wave that is now very hard on Spain, it was much easier. Since 2008 and especially in recent years, it has been very challenging. Yet they’ve succeeded, and their unemployment is 0% whereas Spain’s is 40%+.

Here are some of the details. Of a company’s profits (gross income minus cost of materials of production, cost of labor, cost of overhead, and taxes), 10% goes to an Education Fund, 45% goes to a Reserve Fund (replacement and upgrade of buildings and equipment), and 45% goes to the workers. That last 45% doesn’t go directly to workers but to a Capitalization Fund (basically a large pool of money that the company then invests) that is held in trust by the company. The company pays the worker 7.5% annual interest on the worker’s accumulated share of the Capitalization Fund. When the worker retires or leaves, the worker’s share of the Capitalization Fund is paid out completely to the worker.

So how do you become a member of a cooperative? It takes three years’ probation, an investment entry fee of 15,000 Euros (as of today about $20,000 US), and an approval vote of all your coworkers. Once you’re in, you’re part of the system of cooperatives and are ensured employment until you retire. You can be voted out but that is very rare.

To realize this system, they had to create their own bank. You can go to a bank as a group of equal-worker-owners, and pull together collateral from everyone to satisfy the bank that it can risk loaning you money to buy equipment to realize your idea. But it’s easier if the bank was begun by the Mondragon system, as they understand more readily. The bank gives a special interest rate to cooperatives.

Furthermore, they have developed some amazing support systems for their efforts:

  • Finance – that bank, Caja Laboral, is the second largest bank in Spain
  • Education. They started a university (see below the story of how it began), and this gives them a steady stream of trained workers and inventors/designers, as well as research facilities for some of their inventions
  • R & D – Research and Development. Some cooperatives are dedicated to R & D. Companies on average pay more than the usual for R & D – typical for industry being 5%, and Mondragon’s average 9%.
  • Social Welfare. They have a very good pension plan and health care plan. The latter includes preventive health care, meaning attention to nutrition and exercise – so there is a nod in the direction that we were hoping to see, though not at the level we had hoped. In this should be put the social welfare of others, as there are various projects of technical assistance to other countries that the cooperatives fund. They are aware of the studies that show that trust is good for your health. Inequity and distrust are bad for your health.

Now for some observations so far. The cooperative system can be looked at as a means to preserve worker power in a region where the workers were severely repressed in the Franco years. Now they have fought back with a comprehensive system that supports their community. You have to see Mondragon from this point of view. It is a mountainous area where the valleys are filled with six-story apartment buildings that house the Basques, speaking their unusual language whose origins are not understood. This can be viewed as a mechanism to protect a community, in this case, several beautiful valleys linked by a common cultural heritage. Inside the system, it looks like a great invention to support the community. Outside the system, it looks like another set of companies who are competing in the global marketplace – against the low wages of Chinese workers, against the government subsidies here and there, against rip-offs and copiers of R&D’s good ideas, etc. The Mondragon cooperatives sub-contract to other companies that exploit their workers (low pay, no benefits, the throw-away-worker mentality) in China and South America. Thus from the outside they appear to play the capitalist game, which the apologists view as necessary to keep that cash flow from outside to inside, into the cooperative system.

More story in Part III.

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