Written by Dana Brown, Director, The Next System Project. Article reposted from The Next System Project

They are our collective heritage as a species—both those resources which we inherit from previous generations and those which we create—managed in such a way as to preserve shared values and community identity. The commons are the collective resources themselves, and the practice of collective economic production and social cooperation used to steward those resources—as well as the values of equity and fairness that underpin them—is often referred to as commoning. Many resources can be managed as commons (though often there are attempts to privatize or “enclose” many of those same resources). These can include knowledge, urban space, land, blood banks, seed banks, the internet, open source software and much more.

Potential Impact

The commons are pervasive and as such, often go unnoticed. However, their thriving existence alongside forms of private and public ownership provides a framework for understanding and creating social value beyond the confines of conventional economics.

The rich traditions and successes of commoning provide models for how to push back against privatization and enclosure, ensuring common resources are protected for future generations. Meanwhile, political economist Elinor Ostrom’s Nobel Prize-winning work has disproved the enduring “tragedy of the commons” hypothesis that collectively managed natural resources would necessarily be overexploited and destroyed over the long term.

Taxing the private use of common resources, combined with
redistribution or other efforts to formalize “commons trusts” to ensure their sustainable stewardship, could help stem the tide of privatization and extraction. The tax proceeds could be used as a form of reparation to communities that have traditionally borne the brunt of extraction of their common resources, and to restore those resources when depleted.

Transformative Characteristics

Commoning is a generative and “value-making” process that can decommodify land and other resources, and demonstrate that communities can manage them effectively without private control or state governance. It asserts a different “universe of value” and worldview from capitalism and unfettered consumerism, and helps communities break free from the scarcity mindset of capital. “The commons does not compete on p rice or quality, but on cooperation,” says commons activist and author David Bollier. It “‘out-cooperates’ the market … by itself eliciting personal commitment and creativity and encouraging collective responsibility and sustainable practices.”

The commons, and related peer-to-peer production models, offer concrete, replicable, and dynamic frameworks for sustainably managing existing resources and creating new ones. They also offer a model for deciding what not to produce in order to most effectively protect our global common resources.

Examples

WIKIPEDIA

Wikipedia is a form of online knowledge commons, “a multilingual, web-based, free-content encyclopedia project supported by the Wikimedia Foundation and based on a model of openly editable content.” It contains more than 5 million encyclopedia entries (a shared resource), created and edited by its authors and editors (a community) with a set of community-determined content and editing guidelines (rules). Wikipedia displaced once-expensive bound encyclopedias to become one of the world’s largest reference websites, attracting hundreds of millions of unique users per month and engaging over 140,000 active users—a group that anyone with an internet connection can join—in creating and editing content in almost 300 languages.

EL PARQUE DE LA PAPA

Peru’s “potato park” is a community-led conservation project that preserves traditional customs and indigenous rights to the “living library” of genetic information contained in the over 900 varieties of potato found in the Inca Valley region. The native Quechua peoples bred and cultivated these potato varieties for centuries, but biotech and agricultural corporations moved to appropriate the genetic information in the seeds and take commercial control without the consent of the Quechua people. They then forced the Quechua to pay for the seeds their ancestors had worked so hard to breed and protect. Indigenous representatives organized and successfully negotiated the repatriation of the potato varieties and the rights to conserve them in a 32,000-acre potato park. More than 8,000 community members now collectively manage the park  to “promote the cultivation, use and maintenance of diversity of traditional agricultural resources” and to ensure their traditional agricultural resources do not become subject to private intellectual property rights.

Challenges

Most people are not aware of the pervasiveness and enduring nature of the commons and don’t understand commoning as a viable alternative to consumption-driven and competitive economics. The increasing enclosure and privatization of the commons is erasing our collective memory of many enduring commoning practices. For example, control of the majority of the global seed market (a resource once managed as a commons in many communities) is now concentrated in a handful of multinational corporations. Furthermore, scarcity of some common resources may intensify competition for control in the coming years, while others lack adequate infrastructure support and are therefore vulnerable to privatization.  

More Resources

• The Commons Transition Primer:  https://primer.commonstransition.org

• News, analysis and resources on the commons: www.bollier.org

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Executive Summary

Age-old questions of ownership, control, and distribution in our economy remain as important as ever. In fostering the creation of communities and workplaces driven by values of solidarity, cooperation, and justice, workplace democracy and worker ownership are crucial, powerful tools, and they can and should play an important role in the next economic system.

There is already a long-standing policy agenda for worker ownership that has become a powerful and effective consensus in many countries. This agenda is behind the Employee Share Ownership Plan in the 1974 Employee Retirement Income Security Act, which made available additional tax privileges throughout the next decade and allowed Ronald Reagan to join John Lewis and Karl Marx on the list of those who made public statements in favor of worker ownership.1 It is also the agenda behind both the recent tax incentives for employee ownership trusts passed in the United Kingdom,2 and United States Sen. Kirsten Gillibrand’s recently passed 2018 legislation extending Small Business Administration assistance for worker cooperatives and ESOPs.3

These have produced real improvements for countless workers, but they can only take us so far. We need a policy agenda for worker ownership compatible with the systemic change we know we need on a global scale. If we want to transition to an economy that does not drive catastrophic climate change; dispossession and violence against people of color and the developing world; and gross inequalities of power, income, and wealth, then we need to develop a vision of worker ownership that can contribute to that transition, rather than one that aligns the interests of worker-owners with the shareholders of extractive private corporations that are the problem in our society.4

The initial section of this paper is a review of relevant policy models, including Italy’s decades-old Marcora framework, Washington, D.C.’s Tenant Opportunity to Purchase Act, and the legislative history of existing worker ownership models in the United Kingdom and United States. These will lead us on to a discussion about the principles that should underlie a progressive policy agenda for worker ownership.

The second section of this paper—the policy proposal itself—describes a set of institutions and laws that could enable a substantial share of the economy to transition to democratic worker ownership with “sheltering institutions” that provide a countervailing force against the rigid demands of the market. We aim to offer a path forward for worker ownership for those of us who believe that system change is necessary.

We provide a generalized technical model of a pluralistic “institutional ecosystem” to surround worker-owned businesses; a legal framework that provides an effective right of first refusal to workers to purchase sites and companies that are being closed or sold; and a discussion of the limits of our proposal and an outline of an interlocking mechanism that could fill the most significant of these gaps—especially capital-intensive, publicly traded, and large employers—with an “inclusive ownership fund” that would gradually increase democratic ownership over these key institutions in our economy.

The ultimate goal is twofold: to massively broaden the pool of candidate companies and sites that can be legally transitioned to democratic worker ownership if given the resources (through the right of first refusal) and to substantially deepen the financial and technical resources available to workers at companies and sites within that “candidate pool” to transition their workplace to democratic ownership.

This paper offers tools to activists and lawmakers to promote economic transformation in their own jurisdictions. The appendices offer additional suggestions and implementation details to expand our general model in the United States, where we are based, and in the United Kingdom, where similar ideas are advocated by Labour Party policy as the “right to own”—a term that we also use to describe the full proposal in this paper.5

With these policies in place, societies will be far better positioned to prevent mass layoffs as a result of the so-called “silver tsunami” of retiring baby-boomer owners of small-to-medium business enterprises, many of whom currently close their companies at retirement or sell them to extractive vulture capitalists who asset-strip the firms with little protection for workers. In many localities, extensive legal, financial and technical supports for worker ownership is the best option for maintaining community stability in the face of an inevitable and significant economic transition—one that can be reprogrammed to serve the interests of the many in order to prevent it being exploited by the few.

What the public thinks

A poll commissioned by The Democracy Collaborative with YouGov Blue found overwhelming support for a policy that would give workers the right of first refusal when their workplaces were slated for sale or closure, with 69% of respondents in support and only 10% opposed:

Unlike many proposals that aim at a more egalitarian distribution of wealth, our polling shows that a workers’ right of first refusal is wildly popular across party lines, with 66% of Republicans in support.

Our polling also tested support for a workers’ right of first refusal against support for the existing federal tax subsidies established to reward owners who transfer their businesses to employees by allowing them to defer taxation on such sales. This “1042 Rollover” is very familiar to the employee ownership sector, of course, but not widely known outside of it. Due to its origins under the Reagan administration, this subsidy to owners is often held up as an example of the bipartisan appeal of employee ownership. To our surprise, we found a workers’ right of first refusal outpolls the 1042 rollover subsidy by a 14-point margin, with only 55% of respondents in support of tax subsidies for owners who sell to their employees. Moreover, only 49% of surveyed Republicans supported the 1042 rollover, compared to the 66% of Republican respondents who expressed support for a right of first refusal.

Our polling also found that support for a workers’ right of first refusal increases and solidifies with age—while a solid 59% of 18-29 year old respondents are in support, 15% responded they were not sure. But 81% of respondents over 65 were in support, with only 4% unsure.

Finally, while support was strong across racial and ethnic groups, we found that particularly strong support with respondents identifying as Hispanic, with 78% in favor of a workers’ right of first refusal.

Download and share

originally posted on The Next System

• 1. Marx, Karl, 1894. Capital, Vol. 3. Web: https://www.marxists.org/archive/marx/ works/1894-c3/ch27.htm; Reagan, Ronald, 1987. ‘President Reagan’s Speech on Project Economic Justice’, Transcript: http://www.cesj.org/about-cesj-in-brief/. history-accomplishments/pres-reagans-speech-on-project-economic-justice/.
• 2. Michael, Christopher, 2017. ‘The Employee Ownership Trust: An ESOP Alternative’ in Probate and Property 31(1): p. 46
• 3. US Federation of Worker Cooperatives, 2018. ‘The US Federation of Worker Cooperatives Celebrates the Passing of the First National Legislation That Focuses on Worker Cooperatives’. Web: https://usworker.coop/blog/usfwc-main-street-employee-ownership-act/
• 4. Alperovitz, Gar, 2016. ‘A response to Sam Gindin’, Web: http://www.garalperovitz. com/2016/03/response-sam-gindin/
• 5. The Labour Party, 2017. For The Many, Not The Few. Web: http://labour.org.uk/manifesto

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This isn’t about one or two good projects, or a small corner of a procurement budget getting earmarked for local vendors while everything else remains business as usual. It’s about taking the first steps towards truly transforming our economy so that it works for the many, not the few.

Great graphical resources from The Next System Project (featuring the Preston Model) and Democracy Collaborative (with Community Wealth Building).

The Next System: The “Preston Model” is helping inspire a new conversation about the role of local government in catalyzing locally-driven economic revitalization and transforming patterns of ownership towards democratic alternatives.  (We first featured a story about the Preston Model here in 2016.)

Today, the work in Preston to redefine how—and for whom—local economic development works is at the forefront of the agenda for local Labour councillors in the UK —and front and center at the  “Alternative Models of Ownership” conference in London on 2/10, featuring, among many others, The Democracy Collaborative’s Ted Howard. Major coverage for the model has recently appeared in The Guardian in the inaugural story in Aditya Chakrabortty’s new series “The Alternatives” (and an associated podcast which explores the role that The Democracy Collaborative and the Evergreen Cooperatives played in inspiring Matthew Brown, the leading advocate behind the Preston Model.)

Because the Preston Model isn’t a simple one-element strategy, but a holistic framework for integrating community, cooperative, and public assets into a mutually supporting system of local economic prosperity, we thought it would be helpful to provide a visual representation of how the pieces of the model fit together to build community wealth:

Click to enlarge

Community Wealth Building: Eight Basic Principles

Based on Ted Howard’s remarks to the recent Alternative Models of Ownership conference, we’ve distilled the eight basic principles behind community wealth building—a transformative approach to local economic development—into this handy one page guide.

Click to enlage

The post The Preston Model and the Eight Basic Principles of Community Wealth Building appeared first on P2P Foundation.