A Film About Economic Democracy

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Can We Do It Ourselves? A Film About Economic Democracy

Patrick Witkowsky, Jesper Lundgren, Andre Nystrom and Nils Safstrom (2015)

Swedish with English subtitles

Film Review

“Economy democracy” describes a system in which workers control the workplace and determine the policies under which it runs. The workers cooperative is the best known model of economic democracy.

The filmmakers begin by differentiating capitalism from a free market economy and economic democracy from socialism – as many people confuse these terms. Under capitalism private capitalists own the capital to run a business and enter into a rental contract with workers to perform the labor. Under this system the capitalists own and control the business and keep all the profits.

With a worker cooperative, workers own and control the business and enter into a rental contract with labor to provide capital. They pay the capitalists for using their money but maintain ownership of the business and control of production. They also decide how profits will be distributed.

Under socialism, the capital is “socialized.” Theoretically this means workers own an equal share of the entire economy. In practice, this has generally translated into state control of the workplace, as opposed to worker control.

This film focuses on the day-to-day operation of two 30-year-old American cooperatives. The first is Massachusetts-based Equal Exchange, founded in 1986. The second is New York-based Cooperative Home Care Associates. The latter was founded in 1985 and has 2,300 member-employees.

The filmmakers also interview various academics, activists, business leaders and trade unions officials regarding their research and experience with cooperatives.

The part of the film I found most interesting was an analysis of how monopoly capitalism distorts the free market. Our present economic system actually consists of three markets: the consumer (goods and services) market, the labor market and the capital market. Only the consumer market operates democratically, in being driven by consumer choice. The goal of economy democracy is to democratize the labor and capital markets, which are controlled at present controlled by a tiny capitalist elite.

Because workers have virtually no say into their work and receive minimal direct benefit from it, capitalists must use the fear of being fired to force them to work. This is only possible in economies with high levels of unemployment and poverty. Historically the corporate elites have deliberately manipulated monetary and fiscal policy to keep unemployment rates high.

Once workers own and run their own companies, unemployment and poverty are no longer necessary to motivate them. Thus full employment is one of the most important benefits of economic democracy.

14 thoughts on “A Film About Economic Democracy”

  1. It is a great idea this “economic democracy”, but I don’t think it will solve the unemployment problem. The worker-owned cooperatives are still subject to consumer market. If they produce something few people want they will go broke.

    I have not seen the film yet, but intent do so, but one question arises, do new worker when joining a company buy a share in that company?

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    • From what I’ve read, different cooperatives deal with share ownership in different ways. The method described in the Grit TV film about co-ops (http://stuartjeannebramhall.com/2015/03/03/unemployed-broke-how-to-start-a-coop/) refers to share purchases occurring through gradual payroll deductions.

      Obviously the idea in starting a co-op is to produce goods or services that people want. This is why I think Cooperative Home Care Associates is such an excellent example. With the loss of good manufacturing jobs in the developed world, we are mainly talking about minimum wage service sector jobs like home health care, in which the big problem is massive turnover because workers are so brutally exploited.

      I think the film explains quite nicely why “unemployment” and “poverty” are essential under capitalism to force people to accept wage labor. When workers have a say in their own work and directly benefit from it, they don’t need to be forced to work. Thus there’s no need to artificially maintain high unemployment rates. Workers can also be more creative in deciding whether or not to accept automation (and put people out of work) and opting for part time work (thus helping to create more jobs). In Enough is Enough (http://stuartjeannebramhall.com/2015/05/25/the-steady-state-economy-movement/), they talk about using Universal Basic Income to help people to adjust to working part time.

      I also see more and more analysts challenging the concept of wage labor and everyone going out to work for someone else as the natural state of things. Historically people have always hated wage labor and preferred the independence of growing their own food and providing for themselves. Under early capitalism, it was extremely difficult to persuade people to agree to wage labor, and it was only by stripping them of their land (through the Enclosure Acts) and prohibiting them from hunting (poaching) that they were forced to work in the early factories. I have just finished a fascinating book about primitive accumulation, which describes this process. I’m working on a review, which I hope to post in a few days.

      Now that capitalism is starting to break down, I see the cycle reversing itself, as more and more people opt to reduce their work hours to start veggie gardens, collect their own rainwater, raise chickens, preserve and cook their own food and make homemade cleaning and beauty products.

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    • Fascinating. In a way co-ops are a form of “self-provisioning,” I guess – providing for your own needs directly rather than relying on wage labor. As I mention above, I’ve just finished a great book called The Invention of Capitalism which describes how peasants had to be stripped of their ability to self-provision to force them to work in factories. Historically during every recession and depression, working people return to self-provisioning owing to the inability of capitalism and wage labor to provide for their needs.

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  3. David Schweickart, philosopher from Loyola University Chicago, I thought he explained things very well. for instance why capitalists do not like full employment, and why it should be possible for workers to have more leisure time, and why we cannot have unlimited increase in consumption.
    I have one question:
    Is it fair to say that successful small business owners as for instance tradesman who establish their own business, if they employ a small number of people who do their work satisfactorily, these employees are usually being treated decently, getting a just reward for their work and adequate time off so they do not feel constantly overworked.
    I reckon in the business world there should be the motto: Live and let live, meaning it is wrong for a company to be out to destroy the competition as sadly this seems to be very much the aim in the big capitalist world.

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    • I think it’s part of basic human psychology that people prefer to work for themselves and provide for their own needs rather than having someone else control their work – no matter nice they are. As a doctor with a private practice, I have employed a number of office managers. I always made a point of allowing them to work independently, in addition to paying them extremely well and looking after their welfare. They all saw the job as a transition to something better, ie having their own business where they performed bookkeeping and medical billing as an independent contractor.

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  6. Economic democracy on a large scale would have come about by now if – the huge if – tax rates had become much more progressive decades ago. If, say, decades ago there were no taxes on income up to 40-50 dollars, people would have saved substantial amounts, joined up and started businesses. It seems economically democratic businesses will not become a large phenomenon until radical, very progressive tax systems come on line.

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