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Disruptive Cooperation

Many animal species cooperate with each other in mutual symbiosis. One example is the Ocellaris clownfish, which dwells among the tentacles of Ritteri sea anemones. The anemones provide the clownfish with protection from their predators (which cannot tolerate the stings of the anemone's tentacles), while the fish defend the anemones against butterflyfish (which eat anemones)

Photo of Steve Kube
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Disruptive Cooperation

An innovation that creates a new market by applying a different set of values, which ultimately (and unexpectedly) overtakes an existing market. (E.g., the lower priced Ford Model T)  

Cooperation is the process of groups of organisms working or acting together for their common/mutual benefit, as opposed to working in competition for selfish benefit. 

Exclusionary systems that promulgate extremes of inequality can, and should be disrupted to aid in the shift toward a sustainable economy on the planet that allows everyone to participate.

Adoption and implementation of the systems that led to the tyranny of unbridled capitalism dominant in the world today was a choice made by a well organized few to the detriment of the unorganized many, long, long ago.  We didn’t get here by accident and it didn’t happen overnight.

A funny thing about competition for selfish benefit is it sets the stage for inequality, for a 1% to emerge on top of an ever steepening pyramid. 

The best way to disrupt that pattern is with cooperation, with cooperatives.  Instead of having CEO’s making obscene salaries, perks, and bonuses, amounting to hundreds of times the median workers pay, the top paid people in an organization would make maybe 3 to 9 times what the LOWEST paid people would get.  Lowest, not median.

Yes, it can and does work. See the Mondragon Cooperative Corporation in Spain: At the end of 2012 it employed 80,321 people in 289 companies and organizations in four areas of activity; finance, industry, retail and knowledge.  

At Mondragon, there are agreed-upon wage ratios between executive work and field or factory work which earns a minimum wage. These ratios range from 3:1 to 9:1 in different cooperatives and average 5:1. That is, the general manager of an average Mondragon cooperative earns no more than 5 times as much as the theoretical minimum wage paid in his/her cooperative. In reality, this ratio is smaller because there are few Mondragon worker-owners that earn minimum wages, because most jobs are somewhat specialized and are classified at higher wage levels. The wage ratio of a cooperative is decided periodically by its worker-owners through a democratic vote.[

This framework of business culture has been structured based on a common culture derived from the 10 Basic Co-operative Principles, in which Mondragon is rooted: Open Admission, Democratic Organisation, the Sovereignty of Labour, Instrumental and Subordinate Nature of Capital, Participatory Management, Payment Solidarity, Inter-cooperation, Social Transformation, Universality and Education.[16]

This philosophy is complemented by four corporate values: Co-operation, acting as owners and protagonists; Participation, which takes shape as a commitment to management; Social Responsibility, by means of the distribution of wealth based on solidarity; and Innovation, focusing on constant renewal in all areas.[17]

Check it out:ón_Cooperative_Corporation

A very big question is this: Can the cultures around the world adopt the Mondragon model?  I think it would be a giant leap forward. I also think we need to embrace the collaborative consumption model, as well as reforming our monetary system. 

~ S


Join the conversation:

Photo of David

Steve, I love the cooperative nature of Mondragon and how that connects to salary ratios.

Building on your ideas, I've proposed enacting salary ratios across all corporations, not just cooperatives:

Photo of Steve Kube

Thanks, David. I appreciate your input. How about starting with the banking industry? Pay those guys like civil servants!

I believe salary caps are in place in other parts of the world. I wonder if a wealth tax could help not only level the playing field, but to help conserve our limited resources here on the planet.

Another point to consider on sustainability is the idea of banning "bulk purchase discounts" like getting lower prices if you use more electricity, or gas, oil, water, etc. Much more effort would be put into reducing use. I suppose that is a bit off topic so I'll not go on further with this idea.

Something more on topic would be the idea of finding ways to promote doing business with companies that have reasonable income differences from top to bottom. Maybe apps for smart phones could be created to rate companies so we can be aware of those that are in harmony with these ideas. Which ones are best? Which are worst? Maybe things like this could spur some competition among companies for our informed dollar?

Maybe the apps could remind us of how we are spending our money on a weekly basis. We could get low grades for shopping at "bad companies" and high marks for shopping at "good companies". Just an idea.

~ S

Photo of David

Re: Banking industry: It would be amazing if Wall Street bankers were paid more in line with the rest of America.

Re: Bulk purchase: A carbon tax that accounts for greenhouse gas pollution could help discourage people and corporations from buying more than needed.

Re: Spurring competition: The key to competition is consumer choice — which, thanks to deregulation and consolidation, we don't have much of in many sectors, including banking, airlines, cable, Internet and telephone service. What we have are oligopolistic markets — so even with well-informed consumers, as long as there are few consumer choices then the consumer doesn't have much of a choice and companies can collude to keep quality low and profits high. The solution is the breakup of the big companies like the government did with AT&T in 1984. Unfortunately, with deregulation, the government allowed all the pieces, one by one — like a liquid-metal Terminator after being blown apart — to reform back into a giant corporation. Except that the government went further, allowing (and, in the case of banking, encouraging) more and more companies that are now deemed "too big to fail."

Photo of Steve Kube

How about an app for monitoring banks and their alternatives, like credit unions and such.

Would there be a carbon tax on farmers using more water than necessary?

An app that highlights the differences between choices could help us make wiser decisions on who we do business with. If one criteria is income gap between top and bottom pay scales then companies could compete to close that gap to increase consumer confidence, cooperation, etc.

The suggestion is to increase awareness, transparency of critical issues. For example, if you have a choice between Sam's Club and Costco it may make a difference to know that as President and CEO at Sam's Club, Rosalind G. Brewer made $11,656,257 in total compensation.

The Seattle Times had reported that Costco's CEO, Craig Jelinek, would be paid an annual salary of $650,000 plus a bonus of up to $200,000 starting on January 1, 2012 (with stock awards based on company performance).

That's not very much considering what other CEOs on the Fortune 500 list earn. Today most CEOs take home an average of 380 times more that their employees. In 1973 the average CEO received 20 times their average worker’s pay. In 1980, when the middle-class had peaked, the average CEO received 42 times their average worker’s pay. Today Costco's CEO only earns about 28 times his average employee.

If more people were aware of this I expect they would prefer to do business with Costco. If enough people shifted, then Sam's would likely change their practices, to compete on this issue. At least that's my hope.

We could make similar choices regularly, if we were only more aware of these issues. Car buying, appliances, etc. This is the idea of cooperation among buyers to support a more egalitarian way of life. It could be disruptive if it happened quickly, disruptive cooperation. How can we spark it?

~ S

Photo of David

Re: Farmers' water usage:
A carbon tax likely wouldn't affect water usage; to do that, we would not to phase out historical water rights and phase in pay-per-volume water fees that charge large-volume consumers more per unit than low-volume consumers.

Re: Costco/Walmart(Sam's Club):
I question the degree to which knowledge of CEO salaries would motivate consumer choice on a scale that would make it worthwhile for companies to consider on those merits. (There are, of course, many other good reasons for companies to adopt more equitable pay models.)

I think I addressed your other questions here: