LAST WEEK I wrote that working-class citizens need to fight back in today's environment of class war. "How can they?" is a question that necessarily follows, and it is a challenging one when there are few apparent opportunities for economic transformation and the two dominant national political parties appear uninterested in economic reform. Fortunately, with the cooperation of local government bodies, who can be more responsive to local communities than national representatives, we can begin to transform our economy ourselves, by opening worker-owned and -managed cooperatives.
Worker cooperatives function democratically, with a general assembly of all workers voting on major company decisions and electing a smaller workers' council to make daily business decisions. All members of the cooperative receive the same hourly pay.
In June, the U.S. Supreme Court ruled in Kelo v. New London that the government can use eminent domain, which is compensated government seizure of private property, to transfer ownership to another private party so long as the expropriation serves the public good. In Kelo, the Court stated that economic development can serve the public good. Justice John Paul Stevens wrote for the majority that the government has a tradition of engaging in economic development, and that expropriating property in New London, CT for redevelopment was constitutional local government activity.
Critics of Kelo vs. New London have focused on the possibility that large corporations will use their political leverage to wield the tools of the government against working class citizens. Given the current political environment, this is a distinct possibility. However, working class citizens can use Kelo as well.
Many of our local communities suffering from the "free" trade dogma need economic redevelopment as well. Martinsville, located on Virginia's southern border, has suffered conspicuously from deindustrialization, with nearly all its clothing factories closed and unemployment over 13 percent. I asked several Law professors if it would be possible for the Martinsville City Council, for instance, to seize one of these shuttered factories from its owner and transfer it to a worker cooperative of unemployed textile workers. Prof. Richard Schragger said yes, since "the whole idea in the New London case is that economic development of a struggling community will help the wider community, including poor and working-class people." Prof. Edmund Kitch concurred, saying it would be possible to use Kelo in this sort of circumstance. Prof. Brandon Garrett said that, depending on "whether the taking proposed is simply a private benefit or a public-benefiting development," invoking eminent domain could be used to expropriate factories for workers.
Transferring closed factories to worker cooperatives for reopening serves the public good for several reasons. First, it provides employment for individuals who would otherwise have few choices but to work for poverty wages at Wal-Mart style businesses or remain unemployed. When these folks are working, they need less government assistance, freeing public resources to be invested in more productive ventures like public education, higher education and functional transportation systems. Second, eminent domain can create sources of new tax revenue. In contrast, abandoned factories require police monitoring but contribute nothing to support public coffers. Third, and most importantly, invoking eminentdomain to benefit worker cooperatives serves the public good because it fosters an economy predicated on human needs rather than capital exigencies.
Ample historical precedents illustrate the potential viability of worker-owned and -managed cooperatives. From a single manufacturing facility in Mondragón, workers in the Basque region of Spain have constructed a network of cooperative industries and service enterprises, according to research by Davydd Greenwood of Cornell, detailed in "Industrial Democracy as Process." Over 8,000 Argentine workers responded to neoliberal economic crisis in the past five years by continuing production themselves in over 170 worker-owned and managed cooperatives. In some cases, provincial governments have expropriated the factories or other facilities and transferred them to the cooperatives.
Unemployment in the Charlottesville area is less than four percent. Median incomes are sky high in comparison to many parts of the country. Yet the folks who work at the Wal-Mart and most of the other chain stores up Route 29 in Virginia receive poverty wages with few benefits for long hours of work. Citizens around here need to buy underwear and sweatpants, and sweatshops in China and Central America are not the only possible venues for that production. Nor is Wal-Mart necessary to sell those goods. As the Argentine workers demonstrate, working people can manage their own affairs without seventeen layers of management and corpulent CEOs.
Kelo vs. New London opens possibilities for economic transformation by peaceful and legal means. By working with local governments, we can transform our economy from one in which peonage is the norm to one that honors our social human rights by prioritizing our welfare over the obscene profits of a privileged few.
Zack Fields' column appears Wednesdays in The Cavalier Daily. He can be reached at zfields@cavalierdaily.com.
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