CO-OPS ON THE RISE
I’m still excited about the budding alliance between the United Steelworkers (USW) and the Mondragon Cooperatives – and the general awakening consciousness about worker co-operatives and co-operative business in general that I wrote about last month.
And there’s more.
Rodney North of Equal Exchange (the Massachusetts-based worker owned co op fair trade coffee company) 
made me aware of an article on the New York Times Economix blog by Nancy Folbre, an economics professor at University of Massachusetts. In “The Case for Worker Co-ops” she says, “Since many of our most prestigious economic institutions have embarrassed themselves at our expense over the last year, maybe it’s time to look around. Worker-owned and -managed businesses combine the romance of entrepreneurship with solid family values and commitment to community. What’s not to like?”
In addition to the Mondragon/US Steelworkers agreement and the worker co-ops featured in Michael Moore’s new movie, she says, “Rousing examples abound. CNN Money recently profiled six worker-run businesses including Pelham Auto, whose mechanics have cheerfully fixed every car I’ve owned for the past 20 years.” One of the companies CNN profiled, by the way, is South Mountain.
But all this attention being paid to worker co-ops makes Folbre, the economist, wonder what the economic research says. Not much, according to her. Worker owned and managed companies are “largely ignored in economics textbooks.”
I have found that even the socially responsible business movement, to my ongoing surprise, pays little attention to true workplace democracy.
But she does, at least, find a little research – or maybe it’s just opinion. Mostly it’s about the troubles – or potential troubles – with employee ownership. One of these is that worker-owned and managed companies, with more complex goals than maximizing profit, tend to be less growth-oriented than other companies.
“Don’t tell Wall Street,” says Folbre, “but that could be a good thing.”
I want to say more about the USW/ Mondragon agreement.
The Mondragon initiative is not the first innovative Steelworkers alliance. In the 1990s, the USW helped found the Blue-Green Alliance together with the Sierra Club and other environmentalists and they have been involved with Van Jones’ Green For All.
And now, if this new alliance works, it might make a system of worker-owned enterprises assembled with the purpose of a green restructuring of the U.S. economy. That could be a powerful force.
The USW-Mondragon collaboration grew out of a ‘green industrial revolution’ project that created a partnership with Gamesa, 
a Spanish wind turbine firm, to retrofit abandoned steel plants in the U.S. (40,000 U.S. manufacturing facilities have closed since the beginning of the current economic crisis) and produce wind turbines (there are 200 tons of steel and 8000 moving parts in every large wind turbine). Gamesa’s connection to nearby Mondragon brought the USW and the co-operative giant together.
While this historic business alliance gives hope to the possibility of reviving manufacturing (and the communities that have been devastated by the losses), there is also congressional activity coming along to support employee ownership. According to the Vermont Employee Ownership Center, Senator Bernie Sanders of Vermont
will introduce two new bills that would seek to expand employee ownership in the United States.
The first, the Worker Ownership, Readiness and Knowledge (WORK) Act would create an Office of Employee Ownership and Participation within the Department of Labor to promote employee ownership and employee participation in company decision making. The second bill, the U.S. Employee Ownership Bank Act, would provide loans and loan guarantees to employees to purchase a business through an ESOP or a worker-owned cooperative.
On the eve of the Copenhagen meetings, this collection of related activity is heartening. Perhaps the most important thing about the expanding co-operative business movement, in the long run, may be as an avenue to the large-scale collaborative alterations to the architecture of the economy that will be necessary if we are to successfully tackle the challenges of climate change and the post peak oil transition to come.
Orr & Brand: To Save Our Civilization
Awhile ago I gave up on doom and gloom. I’ve learned enough to know the problems, and I tired of reading 250 pages of meticulously researched how-bad-it-is-and-how-bad-it’s-gonna-get followed by 25 pages of generalities about the solutions. But I broke my rule when I saw David Orr’s new book, Down to the Wire. The subtitle is Confronting Climate Collapse. He does just that.
He says that “The global crisis ahead is a direct result of the largest political failure in history.”
Orr, a professor of environmental studies and politics at Oberlin, goes on to say that “No national leader has yet done what Lincoln did for slavery and placed the issue of sustainability in its larger moral context, . . . and cast it as the linchpin that connects all other issues. Adoption of a robust energy policy is the fastest and cheapest way to improve the economy, environment, health, and equity, and increase security. It is the keystone issue, not just another stone in the arch.”
The book is stark, blunt, and powerful.
“None of us,” says Orr, “asked for these challenges. But it has been given to us to lay the foundation for a durable and just global civilization, to secure the gift of life and pass it on undiminished to unnumbered generations, No previous generation could have said that, and none had greater work to do.”
In his view, it’s all about politics.
And he’s hard on pathological optimists like me. When I was done I needed a lift.
I thought maybe I would find it in Stewart Brand’s new book, Whole Earth Discipline: An Ecopragmatist Manifesto.
In 1969 Stewart Brand released The Whole Earth Catalog, a “book” that probably had as much influence on my life as any other. On the frontispiece of the original classic there is a statement of purpose that begins with the now-famous sentence, “We are as gods and might as well get good at it.” Whole Earth Discipline begins with this, “We are as gods and HAVE to get good at it.” That sums up what’s happened during the 40 year interval.
In this book Stewart closes the loop. In his inimitable way (expository writing doesn’t really get any better than his, in my view) and with the same deeply thoughtful, fearless, always-wry, story-filled and at-the-same-time analytically and argumentatively complex way that he has for four decades, Stewart shakes it up again.
He comes at the issue very differently from Orr. In Brand’s view it’s all about science and technology. But the two books share a fundamental underlying principle: There’s no time to lose and the work ahead is daunting.
But this all goes back a long way, too. In his classic 1973 economics text, Small is Beautiful, Britain’s EF Schumacher’s argued that a linked system of small-scale local economies would be more effective, resilient, and people-centered than a large multi-national economy.
In the Next Whole Earth Catalog, published in 1980, Stewart Brand said about Schumacher’s book, “Few books have exerted such leverage on an Age as this one . . The wonder of Schumacher’s work is his eminent practicality. . . with good sense and a mature spirituality [he] comes on like John Henry against the mega-machine, sure that he will win. . .”
Now Brand is promoting the mega-machine. But Schumacher himself, according to Susan Witt of the Schumacher Institute, said that if everyone were for small, he’d be for big, and it wasn’t just being contrarian. “It was a question of balance,” she says. “Even in the 1960’s and 70’s when he was writing and speaking, he understood that the balance was tipping too much toward large scale economic institutions and there needed to be a correction towards the local and regional.”
Orr argues for the same, but also for massive international political change. Brand does too, but he believes that “at this whiplash moment” we need more than political change and re-localization. “If the transition to a less livable Earth is already under way, we’re ants on a burning log. We can rush around all we want; there’s nothing in our ant repertoire that can fix the problem.”
Brand adds four elements to the usual environmental repertoire: embracing urbanization and greening the cities (where, he says, 80% of the world’s population will live by mid-century), stepping up the use of next-generation nuclear power, bio-engineering to feed a changing world, and geoengineering, if necessary, to “change the climate back.” It’s bold, it’s futuristic, it’s risky, the last three are anathema to many environmentalists, and it’s Brand, through and through.
Underpinning both books is the understanding that the key to our future is the rapid phase-out of coal. Even environmental activist Bill McKibben makes the point, in Stewart’s book, that “Nuclear power is a potential safety threat, if something goes wrong. Coal-fired power is guaranteed destruction, filling the atmosphere with planet-heating carbon when it operates the way it’s supposed to” [my underlining].
One thing Brand is not concerned about is over-population – he demonstrates clearly that we are headed toward planetary population stabilization (and probably reduction). It’s those of us already here that he worries about. “Five out of six people live in the developing world – about 5.7 billion in 2010. One way or another, the world’s poor will get grid electricity. Where that electricity comes from will determine what happens with the climate.”
Throughout his career, Brand has been a prognosticator – his predictions are legendary. Some of them, as he is quick to relate, have been way off the mark. Some, however, have not. He says now that “The shift from dread to action is under way. The outcome is wholly uncertain.”
At the end, he summarizes the book with a few pithy sentences: “Ecological balance is too important for sentiment. It requires science.”
“The health of natural infrastructure is too compromised for passivity. It requires engineering.”
“What we call natural and what we call human are inseparable. We live one life.”
And it’s one world. Tomorrow is the big day of the worldwide demonstration to cut global carbon dioxide levels to 350 parts per million, the upper limit of safety.
McKibben, the chief organizer, says that the 4000 demonstrations and gatherings that take place in 170 countries will be the most widespread day of political action the world has ever seen. I’m sure Orr will be there, in his town, and Brand in his.
I’ll be over at the East Chop Light in Oak Bluffs. See you there.
Cool Biz
I have about half a dozen posts half done and about half as much time as I wish, so for the moment I’m just going to tell a short story paraphrased from Tim Brown’s new book Design Thinking. But coming soon there will be more about that book (and IDEO, the amazing company of which Brown is the CEO), a piece about pirates (as democratic role models!!), a review of two remarkable new books about our future (one by Stewart Brand and one by David Orr), a discussion of how little I understand about the economy (after reading The New Yorker’s ” Money Issue”) and more. . .
In 2005 the Japanese Ministry of the Environment approached an advertising agency called Hakuhodo. They wanted help getting the Japanese people involved in meeting Japan’s Kyoto commitment. Hakuhodo suggested creating a campaign to mobilize the collectivist ethos of Japanese society toward the goal of reducing emissions 6 percent.
They called the campaign Cool Biz. Within one year a staggering 95.8% of the Japanese population recognized the slogan.
It was about air conditioning. Generally the setpoint was 79 degrees F so businessmen in suits and ties could work comfortably in their offices in the hot summer. The Cool Biz program recommended that everyone wear casual clothing June 1 to October 1 so the setpoint could be raised to 82 degrees F. Huge energy savings, but how could they overcome deeply ingrained cultural practice in this traditional and hierarchical society?
Rather than an advertising campaign, the Hakhoto team set up a Cool Biz fashion show at the 2005 World Exposition in Aichi. Dozens of CEOs strutted around wearing casual lightweight clothes with open necks. Even the Prime Minister was featured in newspaper and TV stories tieless and wearing a short-sleeved shirt.
The event caused a sensation. The message was clear: it’s okay to depart from convention to protect the environment. Within 3 years 25,000 businesses signed on and millions of individuals made commitments on the Cool Biz website. The program saved over 1 million tons of carbon emissions in 2006, and it has spread to China, Korea, and other parts of Asia.
It’s the power of effective storytelling coupled with imaginative leadership.
The people are probably happier too, don’t you think? Pretty soon they’ll all be going barefoot.
Living Local & The Next Generation
The third annual Martha’s Vineyard Living Local and Harvest Festival just ended. It began with a Friday night forum called Opportunities and Challenges – a Panel Discussion with Next Generation Island Leaders.
It was about youth. 
Having just turned 60, I am acutely aware of the role of young people (in their 20’s and 30’s) in my work life and civic life. At work they are a constant theme and a growing force. There is a great transition in process at South Mountain Company – from first generation leadership to the next. It’s a long, gradual journey, sometimes a bit frightening but mostly thrilling, and it’s gathering steam.
In Vineyard politics and civic affairs the young are quieter. Those of us in our fifties and sixties have been active, but we’re graying. Sometimes, in the rooms where policies are being shaped that will shape our future, there’s very little representation from the next generation. What does that mean? I know they’re here – it’s not like some places where the young have jumped ship – and I know they’re active and vital, but where are they? What are they doing? What are they thinking?
The forum was an attempt to find out by putting four of them up on the stage in a public setting and asking the following questions:
• How could your age group be more engaged in next generation leadership and governance of the Island?
• In considering our Island’s future, what do you care about the most that’s not being done now, or could be done better?
• What’s your one or two sentence dream for the island in 25 years?
And one other, a beauty that came from one of the panelists, Jeanette Vanderhoop, a member of the Wampanoag Tribe of Aquinnah:
• How do we keep the young and idealistic still idealistic when they’re no longer young?
And, of course, how do we keep them here? My friend Tom Chase, who grew up here, says that his father once told him that the Vineyard has two exports: fish and brains. As he tells it, his dad told him that just after Tom told him he’d decided to stay on the Vineyard (hmmm). Re-localization is about keeping our fish AND our brains right here where we’ve raised them. And doing more to do what we can within our local economy.
It was a lively evening. Besides the diverse panelists, we had two born-and-raised “elder” questioners and an engaged audience. I was the moderator. The panel consisted of a farmer, a boatbuilder, a Wampanoag environmentalist, and a mother of two with many civic responsibilities. Three of them were born and raised here; the fourth summered here and then married into an old island family. They all seemed a bit nervous, but they spoke beautifully, from the heart.
Each of the four individuals is so different that I hesitate to lump them together, but themes developed quickly: the appreciation each has for their many mentors and the community that has nurtured them; their love for the island and the delicate mix of their attachment to the “way it was” and their pragmatic sense that change must come; their understanding that sufficient affordable housing, meaningful work, and limits to growth are all keys to the future; their shared certainty that the time has come for them to take the ball and run with it.
It became a celebration of a way of life that they want to preserve, renew, and re-make. But not only a celebration. They also stirred the pot, and were clear that when we talk about the wonders of this place we also have to talk about the painful parts – the homelessness, the alcoholism, the fractiousness. Jeanette said “I always read the court report in the paper to remind me.” And they subscribed to the belief that you “can’t complain unless you’re willing to change it.”
The most poignant moment for me was when one of the panelists, Myles Thurlow, who described himself as “more interested in boats than school” when he was growing up, fielded a question. The question, from an audience member, was “How do you feel about Wind?”
Big question. There’s no hotter topic on the Vineyard right now. I will say more in a future post about this, but this piece isn’t about the topic, or the content of the response (although I will mention that all basically responded that “we gotta get real; this is an important, necessary, and desirable part of our future”).
It’s about what happened when Myles answered. As I listened to him, speaking off the cuff, I heard a compelling, coherent, elegantly worded statement. And I saw something in his face. It appeared to me that he was saying to himself “I said that? Wow.” And I sensed that he was feeling the stirring empowerment that comes from expressing yourself well, in public, about a controversial topic that you feel deeply about.
I was glad for him, and glad for us. In these perilous times, when these young men and women will be facing and contending with global climate destabilization and its monumental effects, they gave us Hope.
Thank you Chris Fischer, and Katie Carroll, and Myles Thurlow, and Jeanette Vanderhoop. We’ll have to do this again. You guys want to organize the next one? I’ll be glad to help.
Out of the Minefield
After reading my last post, Values and Principles, Ross Chapin (www.rosschapin.com.) wrote to me. Ross is an architect in the Northwest who has pioneered in the design and development of small “Pocket Neighborhoods” and is currently writing a book on the subject. 
Ross wrote, “On my end, we’ve somehow managed to get to this day without laying off or furloughing anyone (gratefulness is a daily practice), though the inquiries for custom homes are pretty shy these days. However, we are, and have been, getting calls from developers all over the country — as many as 4 a week … Mostly mainstream developers, who often say, “Thank goodness for this recession — it brought us to our senses! We were focused on profit, but it was in no way sustainable or good for the community. Can you help us look at a better plan?” … So we’re planning neighborhoods all over – from clusters of 8 cottages, to mixed-use communities of 150 dwellings. Some infill, some brown and greenfield. You may have heard of our work with Dan Gainsboro in Concord? He’s working with us and your friend and colleague Marc Rosenbaum. We’re in the process of submitting a 12-house plan for a site in West Concord. And work in and with our island community unfolds, perhaps similar to MV. These hard times are good for thinking deeply about what’s most important.”
Isn’t that the truth? And isn’t it heartening that mainstream developers are doing just that?
But what about our political leaders? Shouldn’t these hard times be good for thinking deeply about what’s important for them too? The health care battles rage on, economic reform is a distant dream, and climate change – the one that matters most – languishes.
A friend of mine who is going through a major life transition recently said “I feel like a man who has woken up in the middle of a minefield and refuses to move until he knows where it’s safe to step.” The U.S. congress seems to be perpetually standing in the middle of a minefield, paralyzed with fear.
According to the New York Times, (July 29, 2009), a study by the McKinsey consulting group says that a $520 billion investment in energy efficiency improvements to U.S. buildings over the next 10 years could save $1.2 trillion and cut total U.S. energy use by 23%, a reduction greater than the entire energy consumption of Canada.
That’s all well and good, but where does the money come from?
Denmark has a $5/gallon tax on gas and diesel and nobody’s suffering. If we had just a $1 tax it would yield $140 billion/year.
But why stop there? The more you tax the more you have – to reduce the deficit, pay for health care reform, and help low and middle income people pay for more expensive fuel (by cranking up energy efficiency and renewable energy incentives, expanding cash for clunkers, and doing a host of sensible things like that to reduce our oil addiction and create an economy that works). Nobody has to suffer.
If the recession can bring mainstream developers to their senses, maybe it can bring senators and representatives to their senses too. If they were to start to think deeply about what’s most important they might find that it’s not a minefield; it’s a vast virgin forest of new possibilities.
Are We Different Enough??
At the recent conference of the Vermont Employee Ownership Center (VEOC) in Burlington, VEOC board president Paul Millman asked an important question to the attendees, who represented some of the many remarkably progressive companies in the Green Mountain State. “Are we different enough?” he wondered.
Good question. I wonder about that often when I think about South Mountain. Are we promoting a system that would, if widespread, create fundamental change in our broken economic system? Or are we just avoiding one avalanche chute by traversing to another with a slightly more gradual incline?
Hard to say.
In 1987 I re-structured my company from a sole proprietorship under my ownership to an employee owned co-operative corporation. It was a dramatic hinge point in the history of the company. Ownership became available to all employees, enabling people to own and guide their workplace. The responsibility, the power, and the profits all belong to the group of owners. There are no outside investors and no non-employee owners.
That’s different.
Profits are essential , but our cooperative ownership structure assigns the wealth we make to those who make it. Our democratic system of decision making offers everyone a voice. Our employees, who live in the community, and are raising their children here, and are part of the civic landscape, are making the decisions; therefore, community accountability is woven into the fabric of our system.
That’s different too.
Low environmental impact and principled corporate behavior share the same status as profits.
That’s different too.
But principles aren’t really principles until they cost something. And this year some of our principles began to cost something. Last fall, as we considered the re-building of our decimated work backlog, we re-considered some of those principles. Many of them. Here’s just one.
We have had a long-standing policy of only doing work on the Vineyard, the place that we know. That one flew the coop when we had the opportunity to do an extraordinary project across the water, for the Woods Hole Research Center, at a time when our future workload was less secure than usual. It wasn’t the first time we had such an opportunity, but this was the first time we forced ourselves – due to circumstances – to confront the logistical hurdles and internal complications we are faced with. I’ll talk more about this project – and its implications – in future posts.
As a company, we express many ideals. One that we express less often might be the most important of all – to assure that at all times the 30 families (and other associated individuals and companies) that rely on us for their incomes are secure in the knowledge that the work – and the income – will be there. Not so lofty. But this is the real deal, the rubber on the road, and other principles must work in service to that one.
That may be less different, but our democratic structure ensures that we will struggle, at least, to uphold our principles while we keep our business healthy. And struggle to be different enough, even when there is genuine conflict between our principles and the practical matters of doing business successfully.
The beginning of the Obama era is frustratingly slow; it’s not different enough. Each of us can have only a minor impact on the political process. Meanwhile, however, our democracy offers other choices. We have the liberty to invent the corporation of the future right now. We can make whatever kinds of companies we want.
Nothing stands in our way, except us. But we are a significant obstacle. It’s easy to say that we knew all the things the economic crisis, climate change, and the approach of peak oil are teaching us. We did, in a way, but it’s not different enough just to know these things. We have to act, to make fundamental change in the way we work, to learn these things in our hearts and in our guts.
The patterns that we had established over three decades no longer work, and the challenge is to do the work that we must – better service, tighter finances, deeper energy makeovers, higher performance buildings, new forms of old crafts – in this new economic climate. Maybe, eventually, we can be different enough to actually make a difference. Different enough to uphold our principles, even when it costs something.
It shouldn’t be so hard, I sometimes say. But it is. And we have only begun to scratch the surface of change. That’s scary.
But there’s an old Chinese saying that “Man stands for long time with mouth open before roast duck flies in.” We have to roast the duck.
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JOHN ABRAMS is co-founder and CEO
of South Mountain Company and the author
of COMPANIES WE KEEP read more
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COMPANIES WE KEEP is published by Chelsea Green Publishing
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