← Economic Update with Richard D. Wolff
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A
One of these days I ain't gonna change. Welcome, friends, to another edition of Economic Update, a weekly program about the economic dimensions of our lives, our jobs, our incomes, our debts, those of our children, our prospects for the time ahead. This is a program that draws upon a wide range of materials to try to bring condensed understanding of what's going on. A little later in the program, I'll talk about the websites we maintain where you can pursue anything that you find of interest. I'm your host, Richard Wolff. I've been a professor of economics all my adult life and I currently teach at the New School University in New York City. So let's get right to it and talk about what's been happening over the last short period of time since we last spoke. Well, this last week we had an announcement by the Bureau of Labor Statistics in Washington of a very disappointing increase in the number of jobs in the United States. I bring this up not because I take any satisfaction in this sad news, but and by the way, not only was the number of jobs created much lower than in recent months, but they also adjusted their statistics for the last two months, lowering them in terms of how many jobs were created. I bring it up mainly because it's another sign that the so called recovery we've been hearing about isn't really there or another way of saying it is very weak, or another way of saying it is that recovery really applies to the top 5%, the American people and the biggest corporations and pretty much has bypassed everybody else. Here's a piece of good news. It has to do with the state of Massachusetts. Last summer, the state of Massachusetts became the fourth state in the union, four out of 50 to enact a bill of rights for domestic workers. That's right, for all the people who help elderly folks, who help sick people, who work in the homes of other people, as nannies for the children, as cleaners and so on. It has been a scandal for generations, decades and generations how such people are treated. They are often given way too little wages because the laws of minimum wage haven't applied to them. They they are often treated in a disrespectful way. They suffer physical, mental, sexual and other kinds of abuses in the quote, unquote, privacy of the home. A coalition of concerned citizens in Massachusetts called the Massachusetts Coalition of Domestic Workers went to work on behalf of these folks. They are estimated to number 65,000 in the state of Massachusetts. So if you multiply that across our 50 states, you're talking about millions and millions of fellow citizens, a good number of whom are immigrants, some documented and some not. Here is what happened, and I want to call out the states besides Massachusetts that have laws on the books to protect domestic workers. California, New York and Hawaii are the other three. Here's what it does. It mandates that you have to pay in Massachusetts the minimum wage. By the way, the minimum wage in Massachusetts is $9 an hour as compared to the federal minimum wage of $7.25. Domestic workers are now entitled to get the minimum wage. They are also entitled to get a break during the day, to have vacations, to get the same rights basically as are accorded to any other kind of worker. It is a hats off to the state of Massachusetts for passing that bill last summer. It went into effect on April 1, 2015. And that's not an April Fool's story at all. The next update refers to a Texas state senator by the name of Ted Cruz. I don't talk about him much since I'm limited to using polite language, and that prohibits me from talking much about what the man says. He was very proud a few days ago to announce that his super PACs, those are the committees he's allowed by law to use, as are all politicians these days, to raise huge amounts of money in ways that are typically hard to trace in terms of who provided them. He announced that he has already raised $31 million, and it's very clear why he announced that. These days, everything for a candidate depends on how much money he or she can raise. Other candidates drop out if they can't raise enough money because they know that, that if they don't have a war chest to buy ads, they're done. The people who do will buy the ads that make them look great and that make everybody else look evil, stupid, or both. It's not a pretty picture, but it is what passes for politics here in the United States. So he announced that he has oodles of money, with more coming in, most of it apparently from his native Texas. But as you know, it doesn't matter where the money comes from or from whom or how they got it. It just matters how much you have. What's the problem here? Well, I'm not going to bore you, but another lecture about money controlling politics. We've talked about that more than enough, and my listeners for sure know all about it. I want to give you another angle on understanding it. The richer the rich become, the bigger the big corporations become. And in case you haven't noticed, we have had one big merger after another. Comcast is buying Time, Warner, Dutch Shell, the big oil company, is buying Britain's biggest gas company, bg. It's on and on and on, coming together, producing monster companies. Those monster companies have enormous amounts of wealth in the hands of the tiny number of people on the board of directors of these companies, usually 15 or so folks who gather into their hands tens of billions of dollars. They are therefore in an easy position to throw a few million at any politician they want to support any politician saying the things they want the American people to hear. And so they do. And you know the names because they've become famous of the biggest of them, the Koch brothers, who give huge amounts that come from their energy business. Adelson, the king of gambling in Las Vegas and the millions he gives. But I want to stress the most of the money flowing into politics comes from big business and the richest top executives and owners of shares in those big businesses. If you're a small business, you don't have that kind of money. Plus you have to get lots of small businesses together to put the kind of money together that could make any politician pay attention to you. So there's a natural way in which the biggest businesses have the easiest time tapping into the largest amounts of money to shape a politics that is money dependent. Whereas small businesses have a much, much harder time and really can't compete. And when you go to the majority of people, working people, neither big businesses nor small business, but average labor people, well, they of course have the least amount of money to give to politics. So in order to make an impression on a politics dependent on money, masses of working people would have to get together, each one giving a little to produce the amount of money that could make anybody pay attention. And that's of course an enormously difficult organizational problem, just like it's a medium level difficult organization problem to get large groups of small businesses together. The easiest time is held by the biggest businesses generating the highest paid executives. So you notice our political system is tilted. It's tilted in favor of those who have the most money and the least organizational difficulty because to put it to work in the political sphere, but that doesn't mean that the mass of people couldn't play the game. What it does mean is that you've got a system that discriminates against the average person politically because you've already discriminated against him or her economically, because we have an unequal economic system, grotesquely unequal, and because it's undemocratic, since a tiny group of people at the top of our biggest corporations are in the best position to play the game. The only way masses of people would ever be brought together to share the job of coming up with some money, each with a little bit, and to put it together in an organized way is if you had a powerful organization that really advocated for working people so that they would have a clear understanding and a clear interest in doing this. What would such a organization have to be committed to? Raising everybody's wages. That would get your attention. Guaranteeing everybody job security. So if you lose your job in one place, the system is set up to find you another one and to take care of you and your family while you're in transition from one to another. That might make working people sit up and say, hey, that's something I would support. Here's another one. Suppose a political party that was committed to those working people who want to to stop being somebody's employee and open a cooperative workplace. We're going to learn more about that in the interview part of today's program so that workers could become their own bosses and stop being dependent on and oppressed by the bosses they now face. If you had an organization that did all that, you it might be able to compete on what we could call a level playing field. If we don't do that, we're going to be hearing these stories for a long time to come. My last story. I wish I had more time. As usual, my last short update has to do with a bill that's in front of the General assembly in the state of Missouri. It's House bill number 813 being debated in Missouri right now. This bill was put forward by a member of the legislature in that state who is upset about how people getting food stamp support these days. It's called the Supplemental Nutrition Assistance Program, or SNAP for short, but we used to call those food stamps. This legislator is upset and he has a law on the books that says, well, what it is that recipients of food stamps, by the way, they number around 50 million in the United States. We're talking a huge part of our population that is paid so poorly. For example, greeters at Walmart were a famous example that their income is so low that they qualify to get help with food to suffice for their families and themselves. Here's what the law proposes. I will read it to you. Paragraph two of this law. A recipient of Supplemental Nutrition Assistance Program benefits shall not use such benefits. In other words, people getting help will not be allowed to use their benefits to purchase. Here we go. Here's the list. Cookies, chips, energy drinks, soft drinks, seafood or steak Words fail me. People who are getting supplemental food stamps are not going to be allowed when they come home from their job and get their food stamps to buy cookies for their children. We are portraying these people now not as the victims of a system that fails to provide them with adequate jobs, that fails to pay a decent living wage, but we're saying that the system isn't at fault. It's them. And they're bad people and they waste their money and we mustn't let them buy cookies or steaks. That's your typical scene, people getting their food stamps and running to the store to buy $25 a pound steaks for for the evening. This is not just a bad joke. This is not just a sign of a mentally challenged Missouri legislator. This is a sign in which a society that is failing large numbers of its people cannot face that fact because it cannot figure out a way to fix this disaster. So it chooses instead to blame the victim, to demonize the victim. That is a very nasty, unhealthy development. It's a sign of a society breaking down and losing whatever glue held it together. These are very serious problems. I don't mean to pick on the state of Missouri. There are many other states doing similar things. I want to turn now to to the questions that you have sent in that I have selected. I want to thank you, as always, for sending in your questions and comments for us to consider. We read them all. I want to explain, of course, that we cannot answer all of them. We get way too many. But please send them in because it's how we shape our programs. The two websites again, rdwolf with two f's.com and the other one, democracyatwork.info both of those websites will allow you easily to send us all comments, criticisms and questions, likewise by clicking on an icon to follow us on Twitter, on Facebook, and so on. And likewise enable you, if the spirit moves you, to provide us with some financial support. So let's go now to the questions that we've selected. The first one has to do with a question that comes from a listener in California. It goes like this. We have a serious drought in California in the last few days. Our governor has told us we all have to conserve something on the order of one quarter of the amount of water that we were using because the state is in a crisis. We also have a spectacle, says this questioner. We have a woman, Carla Fiorino, fresh from her failure to improve the fortunes of Hewlett Packard Corporation and fresh from her failure to get Elected, trying to get elected again. Who issued a statement this last week that the reason California has a drought because of environmentalists who are to blame. Could you please comment? Well, I'm not going to comment on Carla Fiorino for the same reason that I don't comment on Ted Cruz. I'm trying to remain a family program to be polite and to not say what probably doesn't need to be said about characters like this. I want to talk instead about the drought first. Water has been a problem in California, as in other parts of the United States, for a long time. It is well known that certain kinds of production, for example agriculture, are very water dependent. In order to grow things, you have to have a ready supply of water, you have to have it all the time in the growing season, etc. Etc. Any rational understanding of California's intention, which is very old, of being a major agricultural state growing lots of things that require lots of water on the one hand, and having limited supplies of water that California has to share with other states on the other. That requires a careful rational plan. You have to plan how much economic development you have to because that will put demands on water. And you have to plan that in relationship with your supply of water. That would be the rational way to go about this. California doesn't do that. Why not? Because California is committed to the private enterprise capitalist economic system, as are most states in the United States. Well, let me change that. All states in the United States. And that means the private enterprises insist on being able to make their own decisions on what's profitable for them. If they think they can make more money by growing more artichokes or kiwis or whatever else is in question, they will do that because it's profitable. If they're going to develop a subdivision of an area that once collected water and make it into fancy mansion homes. If that's profitable to the home builder, you he does it. We allow private enterprises to make decisions based on what's privately profitable for them. And then we make believe that that doesn't have social consequences. But of course it does. If you allow these private enterprises to keep proliferating, which is exactly what California has done without regard to the social consequences, a day will come, the day has now arrived when these private decisions run way ahead of what's available in a natural resource like water. And then we have what a catastrophe. It's not a natural catastrophe. It is a man made catastrophe. It's not a man made catastrophe either. It's an economic system catastrophe. The lesson to be learned here is you cannot allow private profit to be the decision determinant of what happens in an economic system because it's too dangerous for all of us. California's drought is simply another example. Last point on it. Sometimes the defenders of capitalism try to enlist working people to support them by saying, we couldn't do otherwise because it would have damaged jobs, it would have led us to stop growing, and then there wouldn't have been as many jobs. That's a false argument. Here's why. It is perfectly possible to plan the development of California taking into account the limits on water, the limits of preserving nature, and the perfectly reasonable demand of people to have safe, secure, decent paying jobs. The same planning that could have helped us deal with a limited water situation in California could also make sure that we never have the irrationality of unemployment. Unemployment makes no sense. It makes no sense to have people who want to work without a job. We all know there's more than enough to get done, more than enough that needs to get done. We can plan that. Everybody has a job who wants one. And it's the job of the government if private enterprise can't do it to get that job done. Just like it's possible to plan on water use, the insistence of private capitalists that they make the decisions themselves without regard to the social consequences, neither for the water nor for the families. They unemploy whenever they choose. That's the problem. And until we deal with that problem, we are going to not solve all those quote unquote, other problems which, when you look at them closely, turn out to be associated with this peculiar economic system that we are now beginning to recognize as the number one problem in this country that we face. The next story is horrible. I admit it's horrible, but sometimes you have to talk about horrible things. I have talked on this program about what we call the medical industrial complex. This peculiar alliance we have among four industries. Hospitals, medical insurance company, drug and medical device makers, and doctors. Four industries. And they work very closely together. They have their fights amongst themselves, but they work very closely together. And they have been successful in making the medical care in the United States more expensive than it is in any other advanced country. Even though the medical results we have child death before age of 1, longevity, number of days in a hospital per person, all of that, our results are mediocre, nowhere near the best, not the worst. But in the middle. Well, any other industry, if your, if your results were in the middle, but you cost way more than everybody else, it would have been a sign, uh, oh, something's wrong. But it's the job of the medical industrial complex to make sure nobody says that. So even in the last year or two, struggling over our medical system in this country, reining in the costs of this has not been a high priority and has not been achieved at least. However, Americans say to themselves, we have an honorable medical system. Doctors do try. The various institutions that we have of medical are at least aiming at improving human health. Well then, what do you do with the following story, a story so awful that it calls to mind a famous Nazi doctor who did medical experiments on prisoners and in Nazi death camps. His name was Josef Mengele and he became synonymous with a kind of medical practice that violates not just the Hippocratic oath, but all moral commitments. This is a story I take from the Guardian, a very respected British newspaper, dated April 2, written by Oliver Laughlin. Here's what the story tells and I will be very brief because it's really too horrible. Between 1945 and 1956, the United States government, according to this story, in conjunction with the Johns Hopkins School of Medicine in Baltimore and the Rockefeller foundation in New York and a predecessor company to what is now known as the Bristol Myers Squibb Pharmaceutical Company, did experiments on a group of people in Guatemala. Orphans, prisoners and mental health patients. Get ready now. Were deliberately infected with syphilis and gonorrhea, two sexually transmitted diseases of extreme danger, in order to test whether certain drugs, penicillins and so on, would be effective in treating these. These people were not told what was being done to them. They were not provided with follow up medical care. They were simply used as human guinea pigs. In 2010, then Secretary of State Hillary Clinton apologized for this program after a commission reported to her on the truth of this. So the victims and their descendants and have sued the United States government, Bristol Myers Squibb, if I understand correctly, the Rockefeller foundation and Johns Hopkins University to begin to provide some compensation for people who were so outrageously treated. The United States government has been exonerated by a court which says you can't sue the government for something that happened outside the United States. Johns Hopkins and and Rockefeller are busy denying that they have any responsibility. What a display of a responsible medical establishment. We've come to the end of our first half of our program. I want to thank you very much for staying with us and for, I hope, finding something of interest. Please stay with us. We will be back in a very short time to interview my guest, Yochai Gal, who will talk about worker cooperative in a concrete way. Based on his own experience. Welcome back, friends, to the second half of today's economic update. Once again, I'm your host, Richard Wolff. At the end of today's program, as usual, I will have some further information about ways you can participate, partner with, and get more from this program by using our websites and so on. But now I want to introduce my guest that I'm going to be interviewing in this second half of the program. His name is Yochai Gal, and I want to give you a brief introduction before welcoming him to the program. He was born in Israel, but has been raised and lived most of his life here in the United States. Yohai was a founding member of both the San Francisco and Boston branches of Tech Collective. As you will see, it is a worker co op, but I will let him describe to you the details. He currently provides business support services at the Boston unit of the Tech Collective. He believes that democracy is an essential right, not only as a citizen, but as a worker, a consumer, a student, basically, in all aspects of our lives. He also loves open source software, traditional Irish music, and science fiction. He lives in Cambridge, Massachusetts with his wife and two cats. Yochai, welcome to the program.
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B
Thanks for having me.
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A
Okay, let's start by asking you to give us a thumbnail sketch of your relationship to worker co ops in terms of your own life.
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B
Sure. So I longed to work at a worker co op when I was a teen and early in my twenties, after fruitlessly searching for co ops within a field that I could actually work in, namely it, I decided to set out on my own and start one from scratch. So I founded the San Francisco branch of Tech Collective In, I think 2007. Started the process in 2005, 2006, but we didn't open doors until April of 2007.
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A
So you didn't convert an existing business into a co op. You started a co op from the beginning?
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B
Yes, that's correct. Actually, it would have been nice to have converted an existing one because then you would have had existing client base and processes and employees. We had to start from nothing. Basically. I found people online and at jobs that I had held who were willing to come on this adventure with me. And that has since worked out pretty well. After moving to the Boston area in 2011, I decided to start another one based on the original San Francisco branch that's almost identical in its processes. We share resources and share email systems and information and all these things, but we actually are financially independent but tightly integrated. We have a very strict relationship with the San Francisco branch at this Moment. There are four full time worker owners at the Boston Tech Collective where I work. Of the original members who started the San Francisco branch, I think there's actually only one original member because the rest all moved elsewhere. I moved to Greece, Finland. Actually no one still is in San Francisco, but pretty much all of us left on good terms. We just had other things to do with our lives.
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A
So who works at the San Francisco branch now?
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B
So the San Francisco branch we have one of the original founding members, his name is Jason, he's been there since 2007. And another guy we found pretty much I think after a year. So he's been there since almost the beginning. His name is Taryn. He's somewhat my counterpart in terms of administrative co op promotion, that sort of stuff. And then they have I think four other full time members.
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A
Okay, so six in San Francisco and four in Boston. So tell me a little bit. So everybody understands what is it exactly that you do? What, what do these co ops? What are the services that they provide?
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B
Sure, I, we're basically like Geek Squad. We're somewhat better than they are, but we are basically, we provide very similar services. So we have a storefront, I'm referring to the Boston branch here, but that's where I'm currently at. We have a storefront where individuals can drop off computers and have their viruses removed or their screens replaced or their hard drives replaced. I mean there's a million things. We do almost anything you can think of except for web design. We don't really do very much web design, but we do a lot of consumer oriented computer repair. And then on the flip side, we also have a data recovery system that we basically built from scratch where we provide low cost data recovery services. And for those who don't know, most data recovery costs upwards of $1,000. It usually starts at around $950 and goes up from there. We start at $250, which is way less than most people. So we try to provide excellent service for what we consider a reasonable rate. And then I and another guy provide business support. So we businesses and provide IT services and monitoring and pretty much anything that a business between five and 40 people might need. Like if you're small enough that you don't need to hire someone to manage all your IT or if you don't have the infrastructure to support an in house IT person, we would provide those services. Normally that's called a managed service provider. So we are an MSP and a repair shop. And that's true for the San Francisco branch as well, they offer identical services. There's little differences here and there, but almost exactly the same.
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A
Would you say, based on your own experience, that both in San Francisco and in Boston you have succeeded in the sense that this is a viable business and has become a viable business in a relatively short number of years? Given that in San Francisco it's a little bit longer. But these are short stories. Are you a viable. How would you respond to that question?
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So I can only speak now of the Boston Tech Collective. San Francisco Tech relative is definitely a viable business. I mean, they don't have debt. I mean, they have a lot of credit. They don't have debt. They pay themselves very well. They give themselves excellent benefits. I mean, they don't pay for anything. They don't pay co pay. They don't Pay. They get 100% paid by the company. They get, I think, $10 more an hour than I do. So they're actually doing very well. They're also extremely popular. They're the highest rated IT company on Yelp in the Bay Area. If you actually go on Yelp, they have about 235 star reviews, which is kind of unheard of in our industry because most people have negative experiences with their IT companies. And so they are overwhelmingly successful. In Boston, we've also been somewhat successful. We still are paying off our initial debt. We actually received a loan from the Cooperative Fund of New England, which is a fantastic organization. It's been running for 30 years. They've never defaulted on a loan. They've never had a client default on a loan. They're really great and flexible and they're also clients of ours. So we're still paying that loan off. It's only been two years. It'll be two years May 1 this year. I consider ourselves successful. We're also very highly rated on Yelp. We're able to pay ourselves full time, decent wages. Not our goal wages, but pretty close to where.
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A
What are the wages, if I can ask in San Francisco?
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B
So it depends what you do. So that's actually one thing that our co op does differently than a lot of other co ops is we don't have equal wages for everybody. Not everyone provides the same services and brings in the same amount of money. Also, it's pretty impossible to. I would say it's very difficult to get someone to do a certain job when everyone else in their industry does that job for a lot more money. So if you have a person in the shop that's making, let's say, $15 to $20 an hour, you can train someone to do that in a relatively short time and they can be good at it and it's a good paying job for what it is. But for someone who's doing business support where out in the field, we're making $80 to $100 a year. It's very hard to not at least come close to that. Between $60 and $80, I would say. So it just depends on what you do. But upwards of $30 an hour, basically. And while I make $20 an hour at this moment, our goal.
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A
But your target is.
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I'd say I would be conservatively happy with 30 an hour within the next three years. I mean, don't forget these guys have a pretty big head start on us and they're the ones in San Francisco. San Francisco, yeah. I mean, comparing us to them is a little difficult for two reasons. One, they've been around a lot longer and they have. They are just known there. They're very well respected, especially in startup circles who need IT support. And then two, the industries are very different. Boston is a lot more conservative in terms of spending money. I would say there's a lot less venture capital. There is still like a mini Silicon Valley going on there, but nothing compared to San Francisco where there's so many new businesses and so much venture capital that people can afford to pay you to install very expensive equipment and. And basically employ people. Like not employ us necessarily, but like hire us for our services, which.
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A
So the basic reality is in San Francisco you've been able to generate a worker co op that really pays its people very well, gives them a medical program with no co pays that covers them from top to bottom. So the answer to the question, can a worker co op be formed in the United States in industries such that it can provide a good living wage and good working conditions? You basically answered that question in the affirmative in San Francisco and it sounds like you're on your way to doing it in Boston as well.
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B
Definitely. I mean, we were very. We had a rough winter because a lot of the businesses were closed for weeks at a time. I mean, there was. We had to close our shop I think four or five times because of the snow this year. And that meant all the clients that I was supposed to go and do work at also were closed. There was a situation where I couldn't drive and I had to do this huge job and I ended up taking the bus, which in the snow took almost three hours and everything got slowed down and we actually did. I think February was one of our best ones we've ever done. And that was in that situation, that was in that context. So I'm pretty optimistic. You know, we still have to talk about finances on a regular basis, and once in a while we have to wait a few days to cash our checks because we don't have the money in yet. A big issue for us is that the work we do doesn't get paid right away. If I go to a job that costs the client $3,000, they're going to pay within 30 days, which means I have to somehow be able to survive before they're able to pay. And that's true for everybody. I mean, we're always chasing in San Francisco, we were always chasing as well. The numbers just got bigger and bigger there. But I would also say that we're not the only example of this in the San Francisco Bay area, which is four full of worker co ops. One in particular stands out, and that's the Rsmendi Bakery.
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A
They're basically a chain program.
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B
You've mentioned before. They pay their workers well above what someone in a similar position would be making elsewhere. So they do really good business. They're extraordinarily popular, bringing in millions per branch. I'm not going to speak for all of them, but I've heard from people who work there, they're doing very well and they keep opening new branches, so it's pretty obvious that they are. But they also pay all the insurance, all the health insurance. I think the Cheese Board Cooperative, which is the sort of font of where all these co ops came from, they actually, I think, bought a cabin in Lake Tahoe that the employees can use. You just sign up for it. There's a lot of other perks that people don't really realize. Some of the perks, for example, in my business aren't even financial. I'm not scared. If I call and tell one of my coworkers, guys, I don't feel good today. I just don't want to come in. I'm not worried about whether I'm going to get paid for that day. First off, you have to now pay for sick days in Massachusetts, so it's not a problem. But second, actually, in my business of my size, you don't actually have to pay for it. So that's not totally true. And then second, I know that this is my business too. And realistically, people need time. And so there's. There's situations where I don't feel like at my previous jobs, I worked in the corporate world or I worked for nonprofits. Where I would feel bad about calling in, saying I couldn't come. I don't feel that way. I feel like bad in that I might be letting some clients down. But you know, my co workers have my back generally. So it's not, it's definitely a lot better than what a lot of independent contractors who do what I do experience. There's plenty of it. People who work by themselves, they do all the books themselves, they have to deal with the whole business themselves. And when they make a mistake or when they can't be there for someone, they're totally alone and it's really stressful. I know this because I did it myself before I did it as a full time worker owner and it's very difficult. So I think that's the benefits are not just financial and not just related to your work. They're related to how you feel as a human, that you feel as an individual.
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A
That's a very powerful argument and I think I've heard it from now dozens and dozens of worker co ops that many of the people will be willing to take a lower pay. Although you're indicating that in your example in San Francisco that's not even necessary. But even people are saying they're willing to take a lower pay because they find that the job is so much more positive. There's less stress, there's less anxiety, there's, there's less fear of your situation and.
- [40:04]
B
That that's worth any trade offs. Also more freedom in general. I mean, I have a co worker at the Boston Tech Collective who worked for 13 years doing the same job, basically most of that for one company. And this is a guy who is full of ideas and full of creativity and full of skills and he brought so many ideas to the table at his previous workplace that they just rejected, they just didn't listen to because they didn't have to. There's one owner there. It's not even a large, it's not a particularly large company, but they had one owner and he ignored most of this guy's ideas and after coming over to us where we basically give him free reign for the most part, a lot of our money making and I would say more business friendly decisions have come from this guy's skills and creativity. I mean if you look at our website for example, which looks fantastic in my opinion, he did that all by himself and he did it without us asking him to. He had the initiative to do that because he's a worker owner. So he knows it immediately affects him to help the business grow. But Also, he knows that he doesn't have to go through all these hoops in order to get a good idea to happen. He just talks to us about it and then we say yes or no. And we almost always say yes because, I mean, he's. Whatever he advocates for, it's not just for him, it's for us too. But we all benefit from it. And in some circumstances, there were times that I was actually wrong where I would tell him, I don't want you to do this. And the website's actually a great example of that, where I didn't feel like we should use a specific service for it. I felt like we should do it a different way because of yada, yada, yada. And I actually got outvoted on that, which happens. And he went ahead and did it. And I'm really glad that I lost that vote. I mean, that's sort of what you learn doing things democratically, is that you don't always win, but you at least have the chance to. And you also have a chance to learn and see why you were wrong and also to prove why you were right. That's once in a while. That's nice.
- [42:03]
A
I want to come at that by asking you two questions. First, an amazing number of people, when they start talking or thinking about worker co ops, come up with something which I consider to be very American because I don't hear it. When I go to Europe and talk to people in co ops, there it goes something like, how in the world could a worker co op work? Why wouldn't there be terrible problems with people who don't want to carry their fair share of the work and who just ride on everybody else? Won't that be a terrible problem? That'll blow it up. How do you respond to that kind of a question or that kind? What's your experience about whether that is or isn't a problem and how you deal with it if it is?
- [42:49]
B
First, I really agree with you. That's a specific American sentiment. I never have that when I speak to people in Mexico or Israel or places I've been to. They never ask that question. But, yeah, sure. So first off, let's say you do have someone at your existing job that's not a worker co op. What happens to someone if they're dragging the business down? Can people seriously say that there are people that they work with that drag the business down, that sit around? It's not like that doesn't happen in regular businesses, in traditional businesses. Second, at a worker co op, if that does happen, one of two things will happen. If, let's say 75% of the co op notices that this one individual is a drag on company resources or is a poor worker or whatever, one of two things will happen. Either they'll have a process to deal with that and I can talk about how we deal with that situation in depth, or they allow it to go by. The business hurts as a result and the business fails as it should. If individual workers aren't willing to democratically deal with things as business owners, and we all have to put business owner hats on once in a while, I feel like the business doesn't deserve to exist. I mean, if you aren't willing to cut out people that are harming your business and therefore harming everyone else's existence, then your business doesn't deserve to stick around. And if it does survive, then maybe it wasn't that big of a deal in the first place.
- [44:11]
A
Okay, but if you, if you are going to deal with it, how does a worker co op deal with such a situation if it arises?
- [44:18]
B
Sure. Well, I can only speak on the ones that I've worked for. I'm aware of how other people deal with it.
- [44:22]
A
But specifically that is really what is interesting, I think, to the people listening and watching.
- [44:28]
B
So we actually have a process for this. First off, we do quarterly reviews and I'm speaking specifically of Boston Tech Lift because SF does things a little differently. But we have quarterly reviews that we already have a system in place for dealing with problems that either the member has with the co op or the co op has with the member, or one member has it with another member. That's always already known because we've talked about it before. It's not like a problem will just happen out of nowhere. We've already been discussing problems someone may or may not have for a long time. And there's always an environment of open air for people to discuss issues like that. But let's say something just come up. Someone steals something or something that's kind of extreme. Let's say someone just consistently does poorly at their job performance. What we will do is first provide an outlet for them to rectify their behavior. That will usually happen with an impromptu, not impromptu, but a non scheduled, like a non standard quarterly, a review. We'll just have a regular review where the person will be talked to about their behavior. We'll give them pointers, we'll get feedback, and then we'll schedule an additional review after two weeks or a month or whatever we think is necessary to see whether that's improved a lot of times. What will happen is the person will give us a good reason for why things are happening and we'll come up with plan to sort of work around that. And I can be specific. I've had co workers in the past who had a difficult time scheduling themselves. And we found a system where we could help this person by scheduling for him without being too motherly, but scheduling for him to sort of offset the specific issues that caused him to make mistakes in the first place. So we worked around it and actually that took three or four reviews before that finally got ironed out. And now I'm happy to say it's almost completely gone as an issue. Now if there are real, real issues, like personality issues, the bylaws of our co op, which are available on our website and our Creative Commons license, so.
- [46:26]
A
Anyone can really take tell us again your website so people can look at it.
- [46:30]
B
So it's bostontechcollective.com bostontechcollective.com and our bylaws are actually at the bottom of the page in PDF form and they're again, Creative Commons licensed, which means just like Wikipedia, anybody can take them and use them how they want.
- [46:43]
A
So the bottom line, since I have other questions I'm burning to get to the bottom line is either this issue hasn't been a serious problem in most of your experience, and when it has, you found ways in a reasonable, humane manner to either work around it or solve it in a way that has, that has made you not worry about this issue.
- [47:09]
B
I mean, we used to worry about it a lot more. People aren't born ready to work at co ops. They're shaped by the American capitalist industry. Our economic system makes us into consumers, not thinkers, not democratic individuals. So a lot of us have to learn. We have to learn it. I have to learn it. And I was raised by very Democratic oriented people. Our bylaws were actually written to give individuals who were being fired a way out, basically. So the only reason I was going to mention that was that there actually is a humane process where they can appeal and there's a process for which we basically make it very hard to fire someone unless it absolutely is necessary and it requires a majority of the vote. And it's not, it's not something that can just happen willy nilly. People have protections. At the same time, we want to ensure that individuals can grow around each other and learn to work with each other. It's not like, it's not like some union stereotype where you'll never get rid of this person because they have tenure, some nonsense like that. You can get rid of people. And we have, we fired. I've actually fired a lot of people, but I've never had to fire someone that was hired as an employee and then became a member. By the time an employee becomes a member, which for us is six months, some places is longer. It takes six months until they can get voted into the co op. By the time someone's a member, they're never voted, only people who, you know, we founded and it didn't work out and we went different ways. But since we, since our inception, no actual member who gets voted in the membership at Boston Tech Collective has ever been fired.
- [48:34]
A
Tell me a little bit about how you make decisions. What does it mean, if you can, with a concrete example. Democratic workplace, democratic decision making. Give us a sense inside a co op, whether it's the San Francisco or the Boston. Either way, how does that work? Give people, if you can, in a short amount of time. Because we don't have a lot how that works.
- [48:59]
B
We have monthly meetings. Our Boston Tech Collective has a monthly general membership meeting. We also have individual shop and support meetings. So we meet amongst ourselves, but we also all have to meet together every month. One person is in charge of creating the agenda. That's our admin person creates the agenda and puts together all the items that we have previously put into a document that are going to be on the docket for that evening. So we are all already encouraged to say anything you want to talk about. Just put on the agenda before this hour and we'll print it out and then discuss it and then we just talk things over. And if a vote is necessary, we have a vote. We have what's called modified consensus. So basically we don't vote unless there's any disagreement. If there's a disagreement, we vote based on either majority or unanimous decision making processes, depending on what it is. Some changes require unanimous votes. So yeah, we just sit around just table, just like this one. We have a person who's facilitating, we have a person who's taking notes and we just talk it out. And if things need to be voted on, like hey, we're going to raise our wages by $5 an hour in this area, vote on it. Or like recently we voted to go, a few of us are going to go to salary instead of being hourly because it just makes more sense. We had to vote on that and it means we had to have one person do the research for the proposal to find out whether it was viable. To tell us the economic implications of it, to tell us what the legal implications of it were. And then we voted on it based on what we learned. I mean, a lot of people say, well, how can workers make decisions of things they aren't trained on? It's not that hard to run a business. It's really not. So many people do it, and there's so many resources out there. If you have one person or two people responsible for getting that information and basically training everyone else on how to make the decision, you can make good democratic decisions without having any background in business or finance or any of those things. Not that it doesn't help.
- [50:43]
A
All right, let's talk about finance. Another big issue that I get questions about. Every business needs money. It needs money usually to start, and it needs money along the way at key moments of its development. What are the problems and what are the solutions that worker co ops have found to getting the financing, the money they need both to start and to grow?
- [51:08]
B
So this is a pretty big topic. It is definitely a problem for all small businesses, but especially for worker cooperatives, because a lot of our legal. A lot of states don't have legal statutes that allow us to exist in the first place. Many of us have to incorporate as LLCs or not incorporate, but have to become LLCs. For example, Massachusetts and California both have specific statues for worker cooperatives. So we're actually at least recognized. It doesn't mean that banks or credit unions recognize us. One major issue is pretty much the same as what regular businesses encounter in that you have people's personal credit on the line, you have to put their credit, you have to give a personal guarantee. Even a wealthy owner of a business has to sign a personal guarantee when he gets a loan out. We have to do that amongst all of us, which means we all have to discuss it. We all have to have our credit approved. So there are issues like that. Fortunately, there are plenty of organizations, at least in my area, that help worker cooperatives get started. I mentioned the Cooperative Fund of New England earlier. They provided US with a $70,000 line of credit to get started based on our business plan that we wrote. And we still signed personal guarantees. We're still all liable for that loan together. But they, since they advocate for cooperatives, they understand that we might not come from places with good credit, and they kind of waive that for some people. So that sort of thing has happened.
- [52:25]
A
Are there other institutions?
- [52:26]
B
Yes, yes. There's the North Country Cooperative Fund, and that's California West Coast. There's a Couple others. You can find a lot of information about this off of the US Federation of Worker Cooperatives website, which is USWorker Co op.
- [52:39]
A
They're sort of USWorker Co op there. You can find lots of information about the financing supports and many other things. Too many other things.
- [52:48]
B
And another great resource chain is I'm one of the moderators of the cooperative subreddit on the Reddit.com website and that has a ton of resources on the sidebar there. But back to your question about finance. It's the same issue as it would be for anyone who isn't a worker co op. It's difficult to get finance, especially in these economic times. We have a few organizations around the country that are willing to work with us and the Small Business Administration. They are now providing SBA loans to worker cooperatives, which they have never done in the past. It's not like exclusive, but they wouldn't even give it to us before. So that's kind of a small victory.
- [53:22]
A
So there are things that are developing.
- [53:24]
B
Oh, and there's one more thing. Some regional worker cooperative groups provide funding for co ops, like in the Valley alliance of Worker Cooperatives in Western Massachusetts and Vermont. They have a sort of a fund. They pool money together to help start new co ops.
- [53:41]
A
Yochai, you've been very, very helpful. I hope the listeners get a feeling, not just from the specifics that you've said, but from your spirit, that this is an experience you relish, you enjoy and you advocate for others.
- [53:54]
B
I am very glad to have been invited here. Thank you very much and keep talking about worker co ops.
- [53:59]
A
It's great we've come to the end of another program, folks. I want to remind you that we are grateful to the truthout.org website every day providing analysis and commentary. Check them out@truthout.org please let others know through social media about this program and about what you found interesting. Make use of our free 24. 7 available websites, rdwolf.com and democracyatwork.info I am available, traveling around the United States to give talks. If you're interested, please get in touch with us and we'll add you to our schedule. And I want also to ask your help in getting interested radio stations that do not now carry this program to speak with us about carrying it. We're over 40 stations across the United States and now increasingly in other parts of the world. Please partner with us in each and all of these ways. I look forward to talking with you again next week. My time, my time, babe. They ain't gonna change. Things gonna change. Yes.
- [55:41]
B
Sam.