Today’s online Der Spiegel offers Mikhail Gorbachev’s views on the future of what he calls "unfettered capitalism." His view is that it’s kaput.
We need to find a new model of capitalism, taking the best of the old model and the best of socialism.
But the new model already exists. Like the tree shrews that scampered underfoot during the dinosaur age then after the asteroid hit became the lineage of all mammals, this new species of corporation has been growing and thriving in the mountains of the Basque Country of Spain for half a century. And it’s name is Mondragon.
Mondragon is one of Spain’s largest corporations, a multinational with factories in many countries. It is also the world’s most revolutionary business corporation because it is equally owned by tens of thousands of its workers.
Mondragon was founded in the nineteen-fifties by the students of a priest-educator named Father Arizmendi-Arrieta. Arizmendi had almost been executed by Franco. He escaped by a fluke, and after the war returned to his beloved Basque country and founded a school in the village of Mondragon, not far from the Guernica made famous by Picasso’s great painting.
During the previous decades Arizmendi had acquired a profound loathing for both capitalism and socialism, viewing both as elitist systems suffused with violence and domination. For over a decade Arizmendi and his students spent many hours discussing the question of what a just economy would be like They explored papal encyclicals on the just treatment of labor. They studied the English cooperative movement and many other similar movements. And finally they came up with a ridiculously simple idea.
The idea was this: that the proper solution to the endless conflict between workers and owners was for the workers to become the owners. But here’s the crucial difference between Mondragon and standard model socialism: Arizmendia hated bureaucracy and national power, and he wanted what you might call socialism in a single company. And this "socialist" company–in which all the workers were equal owners of the "means of production"–nonetheless would behave strictly as a capitalist entity competing in the larger economy. (By the way though all workers were equal owners, not all were paid the same--though even here the difference between the highest and lowest salaries was much narrower than in typical businesses).
Where did these poor Basque students get the money to capitalize a modern business corporation? They started small with a bankrupt company that they bought, and they either put up their own savings or paid for their stock by deferred wages. And this is the real genius of Mondragon, and the reason why it may indeed be the tree shrew that contains the future in its remarkable genome. The Mondragon formula emerged as humanity itself was emerging from its long addiction to agriculture (thanks to the industrial revolution). Mondragon emerged as the industrializing world was becoming more "financialized," a world in which workers though still comparatively poor were no longer dirt poor as they were in Marx’s day, a new world in which even the poor and middle class had modest surpluses. And these surpluses could be pooled and become the capital for equal ownership.
How has it worked out? Any reader can go to the Mondragon website and discover for themselves. You will find no bragging there. They seem, if anything, publicity shy. But when you begin exploring their actual history, their financing, their benefits (which include things like housing, full medical, and amazing pensions) and their ability to weather hard times (like the present), when you see how they perform compared to standard model corporations during both good times and bad, you will necessarily gain respect for the genius of this idea.
So could this be the answer to Gorbachev, and the answer for us, too, a " new capitalism" that combines the best of socialism and capitalism, the best of socialism by keeping the collectivity local instead of nationwide, the best of capitalism in that these collectives compete in the world market against every other corporation, private or collective? Is that the future we would really want, where we own our own companies equally with the other workers and thereby control our own destiny (vis-a-vis offshoring, globalization, downsizing, etc)?