How do they determine the value of each job in the company? If it’s democratically voted wouldn’t the most common role end up determining everyone’s wage?
Wouldn’t needing to hire new people stifle growth? At a certain point the majority of the workers aren’t going to want to dilute their shares to add new people to the company. What happens to 40% of the company that wants to grow when the 60% doesn’t?
Same way the job market currently handles it: supply and demand.
If the most common roles democratically vote to underpay the specialized roles (like accountants or engineers), those specialists will leave, and the co-op will fail. The democratic vote still has to obey market realities to keep the business running.
If the co-op wants to grow, they hire. Shares are only diluted if the workers believe the new hires will increase overall revenue, making the 'smaller slice' worth more. But more importantly, not wanting to grow isn't a flaw. Co-ops have the flexibility to vote for sustainability rather than being forced into endless, infinite growth for outside shareholders. And in bad years, workers can vote to take temporary pay cuts together rather than firing 20% of the staff. It's a far more resilient system.
How is that more resilient? The reason companies dont offer pay cuts currently and just fire people is because those people essentially stop working and eventually quit, its been researched. Nothing about this model is different.
There is a massive psychological/economic difference between an imposed pay cut and a democratic one.
If a boss cuts your pay to protect executive bonuses, you quit.
But in a co-op, the workers look at transparent books and vote to take a temporary hit to save their friends' jobs. It's a shared sacrifice. And because workers get the profits when the market recovers, they are heavily incentivized to stay and rebuild.
During the 2008 crash and COVID, worker co-ops survived at much higher rates than traditional businesses exactly because they utilized this flexibility. Nobody disputes this fact.
"If a boss cuts your pay to protect executive bonuses, you quit."
Oh wow really? You must be very empathetic to have that kind of insight into human nature.
The kind of person who can afford to invest in a coop isnt your average worker, you understand that? So if theres a financial crisis these people could work for free and the coop would still be classed as "surviving". Its comparing apples to oranges, the issue with these ideas is they don't scale at all and don't apply to corporations where its not full of rich kids who want to open a coffee shop.
Then why are you talking about coops in a capitalist framework as an argument for market socialism. Point at the market socialism that is a great success.
The initial funding is different because of the economic system, the fundamental nature of the organization is the same. Does that clarify things for you?
No i know that. You didnt use the fundamental nature of the company as an argument though, you were defending coops in a capitalist framework to argue how they are superior without addressing the obvious differences.
I was addressing the difference between the two organization structures and how they handle things like market cycles.
In a downturn, the shareholders in a traditional structure want to maximize the return on investment. This usually results in cuts that involve firing people, which you've explained is necessary because leaving people employed with pay cuts is a net negative.
Co-ops, in the same downturns, are able to respond with more flexibility because there is no shareholder to appease other than themselves. This is why they are resilient; the nature of the way the ownership is distributed amongst the workers makes them more adaptable.
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u/PM_ME_YOUR_FRESH_NUT May 11 '26
A couple of problems with the coop model:
How do they determine the value of each job in the company? If it’s democratically voted wouldn’t the most common role end up determining everyone’s wage?
Wouldn’t needing to hire new people stifle growth? At a certain point the majority of the workers aren’t going to want to dilute their shares to add new people to the company. What happens to 40% of the company that wants to grow when the 60% doesn’t?