Economic Update with Richard D. Wolff

Episode: Success of New York Worker Coops

Date: October 19, 2017
Host: Richard D. Wolff
Guest: Emma Yorra (Cooperative Development Specialist)

Episode Overview

In this episode, Professor Richard D. Wolff offers a critical analysis of recent economic developments, focusing on widespread corporate misconduct and systemic failures typical of for-profit capitalist enterprises. The centerpiece of the episode is an in-depth interview with Emma Yorra, a cooperative development specialist at the Center for Family Life in Brooklyn, New York. Yorra discusses the remarkable growth and success of worker cooperatives—especially among immigrant and women workers—in New York City, examining both their transformative potential and the obstacles they face. The episode highlights worker co-ops as a practical alternative that can democratize workplaces, build personal empowerment, and foster a more equitable economy.

Key Discussion Points & Insights

I. Recent Corporate Misconduct and the Crisis of Capitalism (00:10–29:46)

A. California’s Push for Political Advertising Transparency (00:10–03:05)

• New Law: California’s AB249 mandates full disclosure of funders for political adverts.
• Significance: A step toward limiting money’s hidden influence in politics. Other states lag behind.

B. Series of High-Profile Corporate Failures

• Monarch Airlines (UK) Bankruptcy:
  • Abrupt shutdown stranded 100,000 travelers, left 300,000 with worthless tickets (03:05–05:40).
  • Executives concealed financial trouble for months to retain profits.
  • Quote:

    "Where's the capitalist efficiency in this story? There isn't any." — Richard D. Wolff (05:32)

• Equifax Data Breach:
  • Company failed to quickly fix a known security flaw, compromising the data of 153 million Americans (06:00–08:00).
• Yahoo Data Breach:
  • Underreported breach size (1 billion escalated to 3 billion accounts) due to lack of investment in cybersecurity (08:10–08:40).
• Johnson & Johnson’s Vaginal Mesh Scandal:
  • Released a riskier, less effective product for profit, resulting in $57 million court judgment (08:45–11:10).
• Two Sisters Food Group (UK Chicken Supplier):
  • Exposed for hygiene and fraud (altering kill dates on labels, reusing dropped chicken) to maximize profit (11:20–13:05).
• Opioid Crisis & Big Pharma:
  • Major pharmaceutical firms knowingly fuel crisis by underreporting addictive properties and ignoring suspicious sales spikes (13:05–17:00).
  • Multiple states file lawsuits against Purdue Pharma and others.
  • Quote:

    "It may have killed a lot of people, but it was profit." — Richard D. Wolff (16:17)

C. Further Cases Illustrating Private Profit over Public Good

• Kobe Steel & Nissan Data Falsification:
  • Admitted to falsifying quality data sold to major transportation companies (17:08–19:20).
• Sears/Kmart Collapse:
  • Corporate leadership prioritized personal profit over jobs and community stability (20:08–22:12).
• University Endowment Inequality:
  • Universities grow wealth rapidly (14%+ annual returns), far outpacing wage and salary increases for workers—worsening inequality (22:40–25:45).
  • Quote:

    "The people who were the richest ... became much richer than the rest of us. The gap between rich and poor is getting much larger." — Richard D. Wolff (25:23)

Summary Insight:
Wolff uses these examples to underscore how the profit motive often leads to systemic neglect, exploitation, public harm, and deepening inequality. He questions whether leaving key institutions in the hands of profit-seeking corporations is sustainable or moral.

II. Main Interview: Emma Yorra on Worker Cooperatives (29:46–56:21)

A. What is a Worker Cooperative? (31:10–33:36)

• Definition:
  • A business owned and democratically run by its workers (one worker/one vote).
  • Contrasts with top-down, shareholder-driven capitalist business models.
• Quote:

  "Worker cooperatives ... are an entity where the people who are doing the work of a business ... are also the people making decisions about how the company is governed ... and setting everything about that business." — Emma Yorra (32:08)

B. The “Cooperative Advantage”: Performance and Impact (34:36–36:53)

• Examples:
  • Si Si Puede! Women’s Cleaning Cooperative: Grown from 13 to 80+ members; outranks major corporations on quality.
  • Other Sectors: Childcare, pet care, handyman services.
• Why They Outperform:
  • Personal stake (“skin in the game”) increases motivation.
  • Ownership motivates workers to provide higher-quality service and ensure business efficiency.
• Quote:

  "If you invest in people and make them owners, the whole enterprise can succeed." — Emma Yorra (36:37)

C. Personal and Social Transformation (36:54–41:58)

• Worker Empowerment:
  • Women often triple their wages, gain job flexibility, and access supportive networks.
  • Leadership skills and confidence flourish, especially for those lacking prior formal education or facing exploitation.
• Quote:

  "We see people ... coming into the cooperative, [who] ... are able to provide them jobs where they are oftentimes tripling their wages ... It's transformational." — Emma Yorra (37:27)

• Example:
  • Cooperative Home Care Associates: Largest U.S. worker co-op (2,300 workers, 90% women of color), with double industry pay and real leadership roles.

D. Barriers to Widespread Adoption (41:58–45:46)

• Underinvestment:
  • Lack of financing for start-ups and expansion.
  • Worker co-ops rarely taught in U.S. business schools.
• Hostility from Incumbent Powers:
  • Historical suppression by large corporations and banks (e.g., Canada, Black co-op history).
• Policy Opportunity:
  • New York City’s City Council invested $5 million in co-op development over 3 years, tripling number of co-ops in the city.
  • Need for legal, educational, and financial infrastructure.
• Quote:

  "When people go … to get an MBA, they don't learn about cooperative economics ... I'm doing a Master's in Spain ... because there's nowhere to study this topic in the United States." — Emma Yorra (44:18)

E. Connection to Larger Justice Movements (47:06–48:43)

• Integration with Social Causes:
  • Examples: Black Lives Matter and New Economy Coalition explicitly endorse worker co-ops for racial, economic, and climate justice.
• Building Alliances:
  • Broader movements can strengthen co-ops’ resilience against suppression.
• Quote:

  "If cooperatives can be part of a larger movement to create a better society, that will give them more power when those kinds of attacks come." — Emma Yorra (48:18)

F. Personal Inspiration & The Broader Vision (48:57–51:35)

• Yorra’s Journey:
  • Inspired by poverty in Nicaragua and a worker-owned factory in Argentina.
  • Found cooperatives blend efficiency and fairness—refuting the "can't have both" lesson of classical economics.
• Quote:

  "You can have your cake and eat it, too. This is productive and just, this is efficient and democratic..." — Emma Yorra (50:07)

G. Momentum and the “Silver Tsunami” (52:10–54:41)

• Business Conversions:
  • As baby-boomer business owners retire, converting to co-ops can maintain jobs/community.
  • Owners often prefer to sell to workers to protect legacy.
• Co-op Networks:
  • U.S. Federation of Worker Cooperatives offers resources for those interested in getting involved.

H. The Future: Is It Co-ops’ Time? (54:41–56:21)

• Need for Paradigm Shift:

  • Worsening inequality and repeated crises point to the failures of neoliberal capitalism.
  • Worker co-ops offer a scalable, humane alternative.
  • Evidence of growing interest and success provide real hope for systemic change.

• Quote:

  "Oxfam ... said that eight men own as much wealth as half the world. ... It's going to be one person or less than one person pretty soon." — Emma Yorra (55:09)
  "The economic system that we have is not working … And I think the work that we're doing now really is a seed and really is an example that can then be taken in many directions." — Emma Yorra (56:08)

Notable Quotes & Memorable Moments

• On Corporate Betrayal:

  "We take for granted that the things we need and depend on are going to be managed in an honorable, safe and useful way by the entity we call the capitalist corporation. And in recent weeks and months, we have been given evidence after evidence that putting trust in those institutions is a mistake." — Richard D. Wolff (03:08)

• On The Cooperative Advantage:

  "If the business does well, [the worker-owners] profit. If the business does badly, they lose ... They have skin in the game." — Emma Yorra (36:10)

• Personal Transformation:

  "We see people ... tripling their wages. ... The potential for leadership development is immense ... It's absolutely like you say, because they have to. ... It really makes me believe in the capacity of the human spirit to just rise to the occasion." — Emma Yorra (41:34)

• The Power of Worker Co-ops & Movements:

  "If cooperatives can be part of a larger movement to create a better society, that will give them more power when those kinds of attacks come." — Emma Yorra (48:18)

Timestamps for Key Segments

• 00:10–19:20: Wolff’s corporate news round-up; failures and harm caused by profit-driven corporations
• 20:08–25:45: Inequality illustrated by university endowment windfalls vs. stagnant worker wages
• 29:46: Interview with Emma Yorra begins
• 31:10–33:36: Definition and structure of worker co-ops
• 34:46–36:53: “Cooperative advantage” in practice: case studies and performance
• 36:54–41:58: How co-ops transform workers’ lives
• 42:50–45:46: Obstacles to co-op sector growth and the importance of public support
• 47:06–48:43: Co-ops’ role in wider justice movements
• 48:57–51:35: Yorra’s personal journey and inspiration
• 52:10–54:41: Converting businesses to co-ops—a coming opportunity
• 54:41–56:21: Co-ops as the next economic paradigm

Further Resources & Getting Involved

• U.S. Federation of Worker Cooperatives: https://www.usworker.coop/
• New York City Network of Worker Cooperatives
• Center for Family Life (Brooklyn): https://sco.org/programs/family-support-services/center-for-family-life-cooperative-development/

Takeaway

This episode powerfully contrasts the failings of profit-driven corporations with the successes and human-centered outcomes of worker co-ops. Emma Yorra demonstrates that democratically run enterprises can outperform traditional businesses in quality, fairness, and empowerment—pointing the way toward a more just and sustainable economy. Worker co-ops, while still a small sector, show growing momentum, especially with targeted investment and support from city governments, and as older business owners retire. The ongoing challenge is building awareness, infrastructure, and political alliances to scale up this promising alternative.