These are mostly situations with a customer interfacing with a biz. How those bizs are organized is going to play a role in what made you choose them in the first place though imo. In those situations they're getting their 'cut' upfront--maybe if they did it at no-cost-contingent/some other deal they could expect a % of the equity?

So how did you select what biz/painter to use? The guy paying hs kids 10/hr to slap it on or a crew of pros being paid properly to do it right? The slap on might be cheaper but you only realize half that 20k the pros cost more but you do. The second option will be guys being paid well/benefits etc(hell it could even be a group of equals that decided to team up because it allows them to take on better jobs) and the first will be the ghetto/CL option In selecting the higher cost/better return guys some of those things are already built into the decision going in.

Coops can't get loans ?

You keep acting like there's a question of IF this can be done.
It's been done. It works. lol

If you have the capital, are you going to give your workers an equal say, a wage, and equal equity stake in the company you start? If your goal is to help workers, sure, but if your goal is to generate income on your capital, you are not going to give up upside when you don't have to, unless you want to burn money. Again, the people who have the capital tend to want to a return on that capital.

Being employee owned doesn't preclude a company being started by capital or giving capital to others, it just means the capital is owned by employees rather than a discrete class called capitalists.

Read the question:

A co-op will almost never have the upfront capital funded by a single person. It normally takes the form of many small individual contributions, either by direct members of the co-op itself or by way of many small loans from individuals. If your only goal is to make money then there are probably better ways to do that, but if you are part of an industry and want to continue working in it while having more direct control of the direction of the business you work for then setting up a cooperative is often a very good way to do that.

In which IHIV accidentally lays bare the fundamental problem with capitalism.

In any case, worker coops are only one variation on socialism like tame alluded to with co-ops being an interpretation of socialism that envisions direct ownership of capital via intra-firm ownership of capital by employees.

It's been pointed out that co-opts don't help alleviate inter-industry differences, so workers in firms that are in capital intensive industries are going to have a higher return on capital and therefor income than firms in labor intensive industries all things being equal.

Also a critique of co-opts is that while they maybe employee owned someone still needs to decide how to allocate capital and that group becomes a quasi capitalist managerial class coming right back to the problem they were trying to solve

The counter that is that it is.... on and on...

Hopefully you're getting the point by now that it's not that socialists are ignorant of capitalism or are dumb about it, but actually a lot of socialists have thought long and hard about how capitalism works, the relationships between groups, firms, stakeholders, etc in capitalism.

Now whether you think the solution is correct or not, it's not for lack of attempts at understanding by the theorists.

It doesn't necessarily need to be equal--let's not get crazy jk. But I do think in an otherwise similar scenario the worker getting some piece of the profits will be more worthwhile/motivated than someone with no real stake in the outcome on a fixed hourly/salary going in.

Actually, what socialist tend to ignore or don't give enough credence to is the redistributive effects of capitalism. Which is highlighted by Wookies criticism:

A successful capitalist investor will create more jobs than a successful coop.

What is your logic behind this claim? Because I see no reason why this is necessarily true.

A smart capitalist investor is going to be diversified. They are putting their money to work in many different industries. I should say a successful venture capitalist, which is what coop founders are trying to be, but a worker is not diversified, and is not able to generate the return a successful venture capitalist does, consequently likely won't invest in anything outside the company and will likely use returns on personal consumption. A venture capitalist invest in many business, consequently creating more jobs than the coop worker/owner, and that continues until the venture capitalist retires.

But this is just comparing a scenario involving multiple businesses to a scenario involving a single business and then saying that the former is better because it creates more jobs. It is specifically the fact that multiple businesses are being funded, not the manner in which they are being funded, that is causing there to be more jobs created. If x businesses were financed by a venture capitalist and x businesses were created and financed as cooperatives I still see no reason why the former would create more jobs.

I'm not so interested in whether this claim is true in the narrow sense, but to point out that, yea, people have thought of it by the evidence of socialists pointing out the problems of distribution aka intra-firm, inter-firm, inter industry and inter national re-distributive effects to get you to acknowledge that socialism is much more varied and nuanced than you seemed to imply with your "no that's not socialism" stance. You may think they haven't put enough emphasis on it, but it's not for a lack of making studied observations.

You've got all kinds of flavors of socialism from co-opts, unionization, social wealth funds, wage boards, co-determination, all policies that are used by people who identity as socialist

Also likes to eliminate competition as it relates to them. Competition may be a good thing for the market and something capital is subject to--but the tendency is to want to get rid of it.

If we wanted to truly spread the joys of capitalism--wouldn't it make more sense to have everyone be participating in the good aspects? Yes that may technically mean giving up some potential equity--but isn't it worth it? Right now a giant chunk of the country has no real skin in the game. Is it not smarter to head off repeating the inevitable cycles of the past--revolutions etc??

I don't think this is the right way to look at it. Say the ROI is the same, but with a coop a majority of the ROI is likely going to a wide swath of workers who will put it towards consumption rather than reinvestment. The standard venture capitalist will constantly putting that money back into other startups, and consequently creating more capital, and more investment than the coop worker in a successful coop.

Probably worth pointing out that socialism is over one third of the USA economy.

Government spending was 34% of GDP in 2019.

In many other developed "capitalist" nations its much higher.

Worker co-ops can expand if they want to.


https://www.uk.coop/newsroom/new-report-highlights-lessons-worlds-largest-worker-co-op#:~:text=Founded%2060%20years%20ago%20in,that%20 of%20Kellogg's%20or%20Visa.

So the real observation might be that pure socialism does not work, but neither does pure capitalism.

Are you now or have you ever been a member of the communist party?

I'd like to think pretty much everyone realizes this. But there's an element to talking with conservatives where they operate from the standpoint of basically anarcho-capitalism as if it's like a totally normal state of affairs and the discussion is based on it being kinda the fixed point everything relates to--which is just kinda crazy imo.

This, much more than wealth hoarding, is how we get a booming economy. Money doesn't create businesses or jobs without customers. More consumption is more customers.

That was directed at wetwork's question regarding the primacy of capital in the equation.

Well the largest class of investors and the deepest investment pool is the public or quasi-public one we're all part of consisting of research universities and the like. And while I'm sure there are plenty of exceptions, I'd say the bulk of all innovation has either come directly from or indirectly through that public investment pool. It's just not monetized so our returns come from the applied side through increases in productivity and new and better goods or lower prices.

But to your point, there's nothing stopping some construction workers from pooling their skills to build and sell homes... except for their lack of capital which is required to set-up the business, purchase the land and building materials along with the personal consumption income they'd need to sustain themselves throughout the investment cycle. Of course they could seek equity investors or a loan, but that's kind of defeating your stated goal but maybe not so much with a loan. Leaving those latter options aside, the workers will need to come up with the necessary start-up capital on their own. People typically do that through savings, i.e., not consuming everything they produce. So those construction workers will need to ~exploit themselves for a while by directing a portion of the fruits of their labor away from personal consumption and towards acquiring the capital goods needed to get their initial production cycle started. And they'll need to keep ~exploiting themselves to some extent if they want to grow their business, just as society at large will need to keep allowing it's workers to be ~exploited if it wants to keep growing.

Sure. But as to why capital gets its returns, like RF alluded to: it was my capital that underwent the capital improvement.

They're painting a house down the street.

A. Why is that ?

B. So what ?

Yeah, I wasn't asking how a start up uses capital. I was interested if you had
an opinion on if a wider array of capital holders would improve the economy.

For instance, right now Wall St doesn't really reflect the economic condition of the average citizen. That gap may narrow considerably. More people may participate in the economy.