This is a linkpost for https://bobjacobs.substack.com/p/isnt-it-harmful-if-worker-co-ops
I have dealt with both greedy founders/execs and excessively cooperative decision-making. I think the cooperative model is slightly better overall for almost everyone inside and outside the organization. It is less fit though; co-ops can't as easily merge or raise money etc. There is also a ratchet issue, where it is harder to cooperatize what is private than to privatize what is coopt. Curious if you have any ideas how coop-like stuff could be more stable / low-energy.
Secondly, even if employees do buy stock, employers have an army of lawyers and much more bargaining power than the employees, so they often pull contract shenanigans.
See also: Startup Stock Options: the Shortest Complete Guide for Employees
There's an important question of scale here. One size almost certainly does not fit all, and the best governance for a multinational many-billion-dollar enterprise is different from that of a local consumer-service organization.
Also, there's a large group of people who seem to prefer to have a "pure employment" model, without having to think about investment strategy or influencing corporate decisions.
The literal, narrow interpretation of what you say is true, but what is implied is not. Coops do work well as many-billion-dollar enterprises, not just as a local consumer-service organization. E.g. Mondragon had a total revenue of 11 billion euros in 2023, while maintaining growth, since that was a 5% increase from the year before.
Also, you don't necessarily need to think about investment strategy or influencing corporate decisions in a coop, since you can grant someone a proxy.
Also also, why are socialist-vibe blogposts so often relegated to "personal blogpost" while capitalist-vibe blogposts aren't? I mean, I get the automatic barrage of downvotes, but you'd think the mods would at least try to appear impartial.
Also, you don't necessarily need to think about investment strategy or influencing corporate decisions in a coop, since you can grant someone a proxy.
You definitely need to think about these things to value working in a coop (or a corporation in which part of your compensation is voting stock) vs "just a job". If you are going to just grant a proxy, you'd prefer to be paid more in money and less in control.
Also also, why are socialist-vibe blogposts so often relegated to "personal blogpost" while capitalist-vibe blogposts aren't? I mean, I get the automatic barrage of downvotes, but you'd think the mods would at least try to appear impartial.
I upvoted, but I don't expect it to be particularly popular or front-page-worthy. It may be partly about the vibe, but I suspect it's mostly about the content - it's a little less rigorous in causality of impact than the more common front-page topics, and it comes across as an attempt to influence rather than to explore or analyze from a rational(ist) standpoint.
You definitely need to think about these things to value working in a coop (or a corporation in which part of your compensation is voting stock) vs "just a job". If you are going to just grant a proxy, you'd prefer to be paid more in money and less in control.
This is a false dilemma. By granting a proxy you can keep the money while relinquishing control. But even if it was true that you'd be sacrificing money there are still people who don't want to think about corporate governance but do want to fight the evils of capitalism and thus would be happy to give a fellow co-op member a proxy rather than earning a bit more (e.g. me).
I upvoted, but I don't expect it to be particularly popular or front-page-worthy. It may be partly about the vibe, but I suspect it's mostly about the content - it's a little less rigorous in causality of impact than the more common front-page topics, and it comes across as an attempt to influence rather than to explore or analyze from a rational(ist) standpoint.
No it's the vibe, I ran a natural experiment to test it and it's clearly just the vibe. I posted the same measured even-handed post on co-ops to the EA forum and LW, but in the former they were called co-ops in the latter socialst firms. The former was upvoted, the latter was downvoted. Also, the most venerated posts on LW (e.g. the sequences) often don't even cite their sources, while that post cited dozens of scientific studies. Also also, my other recent post on co-ops was also data-heavy and it also got downvoted. Rationalists just have an anti-socialist bias.
Also also, why are socialist-vibe blogposts so often relegated to "personal blogpost" while capitalist-vibe blogposts aren't? I mean, I get the automatic barrage of downvotes, but you'd think the mods would at least try to appear impartial.
Posts are categorized as frontpage / personal once or twice per day, and start out as personal by default. Your post hasn't been looked at yet. (The specific details of what object-level political takes a post has aren't an input to that decision. Whether a post is frontpaged or not is a function of its "timelessness" - i.e. whether we expect people will still find value in reading the post years later - and general interest to the LW userbase.)
In my last post, I argued that worker co-ops can help restore declining social trust. But a common objection I keep hearing goes something like this:
Worker co-ops seem basically equivalent to a firm that gives its employees stock—but then permanently blocks them from selling it. Isn't that harmful? The ability to sell your shares is valuable. You might want to diversify your investments, liquidate shares to make a big purchase (like buying a house), or avoid having all your financial eggs in one basket. Why force workers to hold their shares indefinitely? If they really wanted to keep them, they could just choose not to sell.
At first glance, this objection feels logical. After all, publicly traded companies usually let people buy and sell their stock freely, giving investors plenty of flexibility. So, wouldn’t preventing workers from selling their shares in a co-op be bad for them?
But there are a few important details missing from this framing — let's unpack them step by step.
So first of all, this objection doesn’t work for companies that are not publicly traded.
Secondly, even if employees do buy stock, employers have an army of lawyers and much more bargaining power than the employees, so they often pull contract shenanigans.
Lastly, while, in theory, nothing stops a regular employee at a publicly traded company from buying stock, in practice, most stock ownership is heavily concentrated among wealthy individuals. Workers usually don't own a significant percentage of the stocks. But worker co-ops fundamentally change this dynamic by giving employees shares directly, making stock ownership accessible and widespread, not just limited to wealthy investors.
There are two kinds of shares:
Compare this to traditional firms, which rarely offer meaningful control to employees. Employees might receive shares as part of their compensation, but these shares are usually non-voting. This means employees have no real say in company decisions, including crucial financial decisions like issuing new stock.
A common issue in traditional companies is something called ‘dilution’. Dilution happens when a company issues more shares, reducing the ownership percentage of existing shareholders. Think of it like owning a pizza: if someone suddenly cuts your pizza into smaller slices and gives some slices to someone else, your share of pizza is now worth less—even though you didn't do anything. Companies often dilute shares to raise money or grant new stock to executives or investors, and employees typically have no control over this process. Dilution can dramatically reduce the value of shares held by regular employees.
In a worker co-op, dilution can't happen without employee approval, because the employees hold voting shares and therefore control any decision about issuing more shares. This structure protects worker-owners from suddenly finding their shares becoming worthless or diluted without their consent.