A few years back, I wrote a paper called “What’s Socialism Got To Do With It?” I had high hopes for it as pointing out a way to revitalize and economically develop areas without massive influxes of money from outside (which tends to lead to massive outfluxes of money on down the line).
It is one of the most unpopular papers I’ve ever written.
When one talks to economists – or even the general public – they tend to divide everything up into straight capitalism or socialism. Or worse, a misrepresentational mashup of socialism/communism/fascism. And then they align themselves with one side and stop listening to the other.
Mention co-operatives, and the self-styled capitalists stop listening. Mention using co-ops as a natural part of capitalism, and the self-styled socialists stop listening. The thing is, both capitalism and socialism have shown that they don’t particularly work well, at least on large scales. Hell, they don’t even work all that well on small scales.
But they work better together.
“Cooperatives” can simply mean that the employees are also the shareholders. There are benefits to this:
- Business profits stay local
- Increased sense of ownership among employees
- Increased sense of loyalty from the community
- Harness more of the creative energy of all workers by flattening the heirarchy
I think this kind of model could be extremely useful in urban redevelopment. Currently, cities spend huge amounts of money (in tax breaks, etc) to bring in outside business. Instead, they could use that same money to support and start local businesses that keep profits local. The recession has made some things more difficult, but most kinds of knowledge work can still be done remotely. As long as transportation costs stay lower, cities can export – but by creating local small businesses they can retool when transportation costs inevitably rise again.
These businesses may not end up being a blockbuster leviathan of the financial world – but they will do far more good for their employees and their cities. The Ten Living Cities conference is this weekend in Dayton, OH. I hope that as these cities consider their options in the economic world that they can think far enough outside the box to do what’s best for their citizens, not what’s best for an economic ideology.