Economic inequality is a growing concern in our society, and is spurred by corporate consolidation. Large corporations use their market influence and vast resources to crush or acquire competitors, and manipulate politics and culture to fit their ends. A large amount of consumer surplus is hoarded by these corporations, as they increasingly discover and leverage weaknesses in human psychology to trick their customers into paying higher prices or buying harmful or unnecessary products. Our society must address these imbalances, but it is difficult and often impractical to do so with government.
Member cooperatives are a powerful model of economic organization that combines all the best aspects of for-profit companies, non-profit charities, and democratic institutions. In a member cooperative, members democratically own and control a private organization that exists solely to meet the common goals of the group. They grant groups the ability to organize to solve their own economic problems, without relying on the inherently adversarial profit motive. And in the form of Credit Unions, the viability of the model has already been proven.
However, since member cooperatives have traditionally relied on the same slow and inefficient methods of democratic control used by governments, they haven't reached anything close to their full potential. By using Persistent Democracy, member cooperatives can be controlled in an extremely nimble and fair manner, allowing them to inspire confidence and compete with profit-seeking companies.
Member cooperatives need some way to distinguish voting members from everyone else, and must require that members contribute in some way to the cooperative. This means they work best when the customer relationship is ongoing and predictable. Any business model based on subscriptions or membership fees can be trivially made into a cooperative, and as the recent direct-to-consumer subscription service trend demonstrates, many more products and services can be delivered as subscriptions or memberships than was previously appreciated.
The industries we should most prefer to start cooperatives in are those where risk is well quantified and market value is obvious, as is the case in any commodity industry. Almost all industries that currently form the bedrock of our economy could be operated as member cooperatives:
Activists seeking to address economic inequality, poor public health, environmental degradation, or cultural manipulation have been frequently frustrated in trying to institute legal solutions to these problems. Many will of course still require legal changes, and we shouldn't tolerate our political systems being so inefficient and unresponsive. But even if the structural reforms discussed in this book were implemented and used to agitate for other reforms, democracy still requires something resembling consensus. An efficient and fair democracy won't be enough to solve all these issues, and we'll still meet resistance and frustration when pursuing goals that seem obvious to us. To deal with this reality, I propose a new kind of activism, Economic Activism.
Member cooperatives can be started by anyone at anytime, with no need for special permission or legal reforms. They simply must follow the law and remain solvent. Anyone with passion for some change that would require businesses to act differently can immediately begin working to make that change by creating a cooperative. Cooperatives don't in any way extract profits to an owner class and can instead reinvest profits to lower prices or improve service, and they can quickly hold managers accountable through democratic control. These qualities mean cooperatives always have the potential to maximize consumer surplus and increase members' prosperity more than a for-profit company. If a cooperative can create more prosperity for members, then it will inevitably overtake and destroy any abusive for-profit competitors, taking away the economic capability that forms the foundation of plutocratic power.
It has been relatively easy for the wealthy to prevent social change by hampering politics. But in order to stop cooperatives from overtaking their companies they would have to hamper the very markets they themselves operate in, a more delicate task.
We don't have to wait for the goverment's permission to attack economic inequality and consumerism. Through cooperative Economic Activism, we can attack the source of those problems directly and immediately. We can seize the economic power that has for so long been used against us.