AskProfWolff: How Worker Co-ops Differ from Capitalist Enterprises 

Professor, you are a true warrior of the working class. Thanks, once agian. We are making history.

Thanks for sharing. This is a great idea. Systemic thinking is the way to go. I love your work and videos Dr Wolff.

Adding to my undergraduate degree in Wolffist economics.

I am insanely honored to have had a video made about my question by Richard Wolff, who was literally my introduction to Marxism. I am a little confused as to how a worker co-op economy addresses the abolishment of the commodity form, and creating a classless, stateless, moneyless society. At one point in the video, Wolff described that markets may not even be used, at which point I thought of council communism which is a system I think has a lot of merit. But Wolff also said that he envisioned a mixed system which involved markets and public ownership, and as long as markets exist, commodities are still being produced, capital can accumulate, and distribution will probably still be unequal. If Marxism seeks to create a classless, stateless, moneyless society, I just wonder how a market based worker co-op system addresses this.

Where I live, we get much better service and prices from our rural co-op electric company than we do from the corporate cable company, which has a monopoly.

I just discovered your work through cooperative research I’ve been involved in within the Cooperative Agricultural Network based out of Northern California. I’d like to take the opportunity with this comment to say thank you sir. Thank you for your continued advocacy for democratically run collective organizations versus the status quo. Thank you for all your explanations and the diligence you provide with these thorough explanations. You are a champion of these ideals and have provided the Avenue to making these ideals a reality. Thank you again.

Algorythm ain't gonna feed itself you know :)

Gracias from Tecate, Mexico

Thank you for sharing Prof. Wolff

You are a genuine person. I like your ideas because they are outside of the "box", the box being, capitalism, socialism, communism. Most people in America immediately say "we don't want communism" and what you are proposing is something different than that. I believe that people need a 'sense of accomplishment' in a society, a way to better themselves if possible.

I have the greatest respect for Richard Wolff and he really opened my eyes to a whole lot of ideas, but this is precisely the topic on which I disagree with him. Worker cooperatives will have every incentive to compete against each other. Competition is a very negative thing, and it goes against the cooperative spirit. Two worker co-ops competing in the the same industry will have workers wasting their labor everyday making something that is already being made elsewhere, just for the sake of undercutting the other cooperative. This is the duplication of labor. It's part of the reason why we have invented countless labor saving technologies yet the 4-day work week has never been realized, or the 8-hour workday hasn't been shortened. Under a profit-driven system, (which Prof Wolf's proposed system still is, because as he says even in this video, while the profit is made in the factory it is *realized* on the market. Workers will want to realize the maximum amount of profit for their labor, naturally) It is almost impossible to lighten the workload on the working class because if one enterprise decides to shorten the workday they will be out competed by the one who elected not to. The profit motive must be abolished to see any gains for the working class and, to my reasoning, the only way to do so is for the formation of a cooperative of all the workers. If the workers were part of one united democratic enterprise their interest would finally be aligned and they may be able to achieve something great. Separate cooperatives will only entrench the divisions between the working class. As it stands the workers do not have any motivation to fight against one another, yet they still do. I can't imagine that under a divided cooperative system where they have legitimately opposing material interests how they could possibly unite. The capitalist system has ingrained itself so far into our heads that we can't seem to understand that competition is not a virtue. Competition is only good under capitalism because it keeps the capitalist weak, it prevents them from uniting and forcing their class interest upon the rest of us. And by the same token competition will be what prevents the working class from uniting and establishing the "dictatorship of the proletariat" (rule by the working class). Cooperation is the only way forward for socialism. All we need to do is accept that maybe we don't need 97 brands of toothpaste made in 96 different factories, and to trust that we the working class can run society.

Except in Monopolies, or Oligarchies. Then, they can extort profits from customers, suppliers, and extra from the workers, too. Walmart, and Amazon, has perfected this model.

Easy answer One is a shared creative venture and the other is an organized criminal venture. One is representative democracy and the other is authoritarian fascism. One is built on freedom and the other on slavery. One is freely accepted and the other needs indoctrination of selfishness to motivate people.

I envision a horrifying scenario within our co-op. Half of us want to continue our co-op structure, the other half want to sell it off for millions of dollars to a venture capitalist. The workers were living very comfortably under the current co-op system but now there's a potential for them to be millionaires for the first time in their lives. It's a nightmare scenario that I keep playing over and over again in my head because it seems that everyone has a price. And if the co-op decides not to sell, then the capitalists will just create their own version of what we were doing - and not just that, they'll sell their version for less until they run us out of existence.

RichardDWolff please run for president

Richard has done an excellent job manufacturing consent for the World Economic Forum's Great Reset. We Billionaires thank you for helping us to increase profits. 😀

To much Greetings Mr Wollf!!!

It sounds like there needs to be more development in this model. Not everyone is called to the different roles in the business. That's why we have a CEO, VP, and this system of growth. How do you work around this issue?

The fact remains that, even if the surplus is theoretically generated inside the enterprise, if worker coops participate in markets, the surplus is realized in those markets. To "distribute" coops' products for free would require the rest of society to subsidize them; that could happen, of course, as it does in the professor's example of the parks. But a society based on coops would have to evolve some very sophisticated methods of distinguishing between which products will be subsidized and which will rely on the market to realize their surplus value. That decision-making process is where I fear the society is at greatest danger of becoming top-down, bureaucratic, and riddled with power games.

Take the cooperative principle and "scale" it upward and outwardly.

Wollf is the only person I can comfortably put on x2 speed lol

I love Wolff's conceptual powers. "Profit occurs in the enterprise during, and by virtue of, production." I wish he would practice his delivery, which seems to focus most on enunciation.

Да, заблуждение многих людей, очень много людей, которые думают, что прибавочная стоимость происходит на рынке, к сожалению

So its power. Who has power to make choices and who doesn't.

To go a step further, a worker co-op shouldn't be owned just by the workers, but also the customers. This way, everybody who is affected by the choices and actions of the co-op will be able to hold that co-op accountable.

Capitalists always want to have more control over the decision process. They are obsessed with a birds-eye view and planning ahead. Although it is relatively easy for them to predict trends when they have consistent data, it can be challenging for them to plan when things go south. In that scenario, their best bet is to be very conservative and cut costs to survive. It seems very narrow-minded.

Hi Richard, can you help us understand the difference between a cooperative and a 100% employee-owned company with an ESOP (employee stock ownership plan)? I've come across a few companies that claim to be 100% employee-owned via an ESOP, and I'm curious about your take on the pros and cons and how they differ from a coop.

Professor, could you tell us more about the combination of worker co-op systems and customer co-op systems? I really want your take on this, because market socialism, without customer co-op systems, in my opinion, still has a chance of benefitting the minority, worker-owners over the majority, customer and local communities, and therefore could potentially bring some of the same issues that come with other laissez-faire market systems. This brings into the limelight the concept of DECENTRALIZED planning, by customer-worker co-op systems that tackle both production AND distribution.

I wonder if many "Worker Owned and Operated Businesses" would develop a separate "Free Market", that is not the same one as the Capitalist Free Market"?

What about startup costs for new businesses? In a start-up business, that is not yet profitable, capital puts up all the initial risk, and labor is more-or-less guaranteed an initial salary, even during the time when the business does not make enough revenue to pay them. How would you recommend starting a worker coop from nothing? (assuming capital is available, but requires a return on its investment in order to fund the business through its unprofitable early stages)

Prof, Is Huawei what a worker coperative is or should be? I mean it seems to have that kind of ownership stucture?

Always have to put the playback speed to at least X 1.5

Democracy in work place will face same problems as democracy in politics. We are in this sh*** today because majority voted for it. Why I should believe that Democracy in workplace will have better results?

8:00 I take issue with this video because I haven't seen ducks in the north east in years.

I think this type of system is ideal for humanity,major population but the capitalists or businessman or entrepreneurs will not agree with this because then they will say what's the point of doing business then,thats the thing.

Worker co-ops need a lobby so that they can get congress to incentivize worker co-ops.

What prevents a worker co-op from trying to become a monopoly?

a co-op can only grow very slowly, over generations. a hired labor company can grow rapidly, with injected capital. and that's why co-ops are few. they will usually be smothered by liquid money. co-ops are not democratic. they are not a political organization. democracy can happen in a hired labor society, the swiss do it. co-ops can do business in an elective aristocracy, such as the usa, and many other nations. capitalism 'fails to save you' because it is an economic feature of elective aristocracy. neither capitalist nor aristocrat cares about you, because you have no power. you are not a citizen of democracy, just a consumer.

How did society get to own the means of production? So, if " the point at which it realizes the profit that was created by surplus labor value. " then if a production system is entirely automated, from whence comes the "surplus value."? For this example, the system created is due to the labor and intellect of a single person. Is there no profit? Or is the man guilty of exploiting himself? The only labor here is that of the owner, who built the production line whose production he sells to society, which he does at a profit. If there is no surplus labor ( and there is because the machines are doing it ) then there would be no profit. ( which there is. ) So it seems you have invested a great deal of effort in avoiding the question because the labor still exists, it is just being done by the machinery, whose costs are met ( according to their need ) and produce a profit. ( according to their ability. ) And this is both precise and accountable for all aspects of need and ability as they apply to the machines. The production which is the end result still has value, so where did the value come from? There is no surplus labor, for the needs of labor in this instance are precisely met...so the labor is not being exploited. This would suggest rather starkly that what profit is, it is not due to the surplus value of labor but rather from the transformation of the materials used from a less useful form to a more useful one. ( and none of the labor here contributed anything to the intellectual process of devising that transformation, ) It also challenges directly the idea that when machines replace humans, any increase in productivity is due to the human, when it is clearly due to the machine. It might even be argued, and rather strongly that the contribution of human labor to the end result has actually decreased since the energy expended by what humans remain is empirically less. ( as determined by the empirical calculation of work )

I love co ops but not all enterprises can be structured the same. In the world of entrepreneurs, you don’t necessarily need a college education. You need a proper education.

Isn't this still capitalism? My understanding is that capitalism is "the voluntary exchange of goods and services" so a worker co-op is just a better way of organizing a still capitalist enterprise?

I thought this was a comedy video at first. This is only a theory that could only work if you are talking about a group of people making mudpies. The reason you will never see worker coops is because they don't work. Of course, you could establish one, it's been done before in America. Plymouth colony tried to do it, and when it quickly failed they moved to a don't work don't eat system. It worked. Then there was the Oneida Community, and several other utopian startups that tried it, but failed. It was tried again in the late 50s through the early 70s with the hippy communes, and they all failed. Why? Because in every case some people wanted to work harder and get ahead, and others wanted to ride on the coattails of the others. In each case, it was impossible to say whose work had what value. Plymouth community had people cooking, sewing, farming, hunting, a doctor, and community management. So, how do you value the doctor's work when he may only see a few people in a day, and the woodcutters swing an axe all day? I own an engineering manufacturing company. I have around 320 people who work there. I'm retired military and we service government contracts to produce several pieces of equipment. In his example, you would have all 320 people trying to make decisions about the functions of the business, and how to distribute profits. My business would fold in a month if we did that. Here's how it really works. I put my company in the small town I grew up in and retired to. It's a beautiful town of 13,000 people wrapped around a mostly undeveloped lake. There are two larger towns located 30 miles away in opposite directions. Because we are not a large town I have to recruit engineers and computer guys away from bigger towns. So, I offer better than average pay and compensation packages. I don't have trouble recruiting line workers, custodians and admin people, but I pay them better than average. For example, my custodial team makes about 25% more than they would working for anyone else in town. Each year we make a distribution of the annual profits to all employees equally. Last year employees received a 7K check just for being part of the team. Employees hired during the year receive a prorated amount My business makes a lot of money, and as the owner, I receive the bulk of the profits and here's why; I am the one who earned three college degrees enabling me to put the ideas in place that started the business. I am the one who dug into his retirement to get seed money, I am the one who worked with banks, industrial machining companies, and developed government contracts. I am the one that worked 70 hours a week getting it started and still work at least 50 hr a week. And if it fails, I am the one who takes the biggest loss. My highest paid person makes a fifth of what I made last year. Every employee is in a great job, well-compensated, and is thereby their own choice. Where Dr Wolf's understanding of business falls apart is that employees agree to exchange their work for a salary. My lead in the custodial staff is a friend from high school and retired as a school teacher. He comes to me once a month and makes an offer of how to show them how much we value them. I have bought T-shirts, Pizzas, sent them to a local steakhouse for lunch, they are not docked time for going to a school function with their kids. Will I ever pay them 100K salary even though I could? No, and neither would you if you had a company. I think it's doubtful Dr Wolf has ever run or owned a successful business. I'm fact I have never met a professor who has. I wouldn't take business advice from someone who has never been in good and bad businesses. And contrary to popular belief - business owners and managers don't take advantage of their workers - those that do go out of business quickly.

It should be obvious, to anyone, how a cooperative enterprise differs from a hierarchical capitalist enterprise. First of all, a capitalist enterprise puts "profits in command" as Mao described it, and profit triumphs any and all considerations. A cooperative enterprise would be less likely to overproduce and have to thus stall production or lay off employees, as a result of their constant push to produce. A cooperative could forego such need for profits, and produce commodities on a more rational scale. Cooperative enterprises would also not diminish the purchasing power of consumers, but would rather increase the ability of its workers/consumers to purchase the products that these businesses produce. This would, obviously, by far diminish the tendency of capitalist enterprises to entangle themselves in what Marx called "the crisis of overproduction." I don't believe that transitioning capitalist enterprises to cooperatives is the final answer, but this would be a very useful step in making the jump to a socialist society. Workers are still going to need to capture the power of the state and use state power to bring about the transformation of society. They would not, however, simply use the ready-made state apparatus, but instead would streamline the state and all of its huge, bloated bureaucracies into a more economical and better-functioning administrative body. There would no longer be any need for a large number of different departments, with all of their private for-profit contractors that are gouging the taxpayers and looting obscene amounts of money from the federal budget. No, a proletarian state would look much different than the current bourgeois state that we all live under. And the debts, the huge debts that the People of America have lingering over their heads, would all be expunged, eradicated, done away with, once the proletariat came to power. The wealthy bourgeois class has sucked off of the tit of the government for far too long, while transferring the tax burden onto the workers. A proletarian state would put an end to that arrangement almost immediately. So, those workers who are doubtful that a worker state would work, or pan out, in any kind of way, need to take this into consideration. The debts would be absolved, forgotten. And we could all start afresh, with a clean slate. But eventually, the final goal of a communist society is to do away with the institution of money and banks, once such wide material abundance is created, by the working people of the world, there would be no need for purchase, lending, debt, or any of these other false creations. Individual transactions, between private citizens, could be done through a barter system - you exchange what you have, if you want some of what I have. But generally, the basic necessities of life would be in such abundance that there would be only a small need for exchange, on the side. This would take many decades, if not centuries to develop, but I think making all enterprises cooperative might be a very useful first step in that direction.

So much of the co-op alternative isn't, or rather it's an alternative of but not to capitalism. Many co-ops are simply extensions of philanthropic colonialism through the nonprofit industrial complex/NGOs. They often are little more than slick advertising campaigns to capitalize on informal sectors of the economy, especially those exploitable on the basis of identity politics, to integrate them into the same old unfree market relations. In short, co-ops are a means of co-optation. They fall far short of the revolutionary alternative Marx and others envisaged, especially circumventing and preventing the necessary political movements to serve as the base for working class people to move beyond economic alternatives, no matter how genuine, which will prove powerless by themselves to change the playing field's power relations. This entrepreneurial professor is all the more suspect as an alternative pusher of bizzness as usual in that he shamelessly promotes the corrupt and criminal plandemic currently rolling out to reset the global economy under techno-totalitalitarian control by the "masters of mankind" (Adam Smith).

We know you like to go to the beach to lurk at the ladies Professor Wolff lol

Where I agree with the Prof. Is that enterprise doesn’t hire labour paying wages for the good of the community, they exists to make profit but competition drives down the price of the product. How would big state ‘coops’ that naturally employ human labour for the sake of employment compete against capitalist enterprise who displace humans at the first opportunity? Reminds me of Chairman Moa and his workers in the fields. Capitalism uses machines that are more efficient and cost less to run. I still laugh at the idea where ‘coop’ enterprise have votes on how to run the business, asking the cleaning lady what her opinion’s are as to how to compete against ruthless profit oriented companies. The truth of it as it appears to me is that these notions may have worked before innovation, or in a world where everything was socialism. As soon as capitalism exists anywhere it becomes the fox in the henhouse.

Wow, this opportunistic Anarcho-Libertarian-Capitalist has no shame.

Most of your ideas are wrong. The only co-ops that work are a wife and husband team. Workers cannot manage themselves. Have you ever had a business?