Co-ops in Spain’s Basque Region Soften Capitalism’s Rough Edges ( The New Yoork Times, Jan 3 2021)

 

https://www.nytimes.com/2020/12/29/business/cooperatives-basque-spain-economy.html

By Peter S. Goodman

"If the Erreka Group operated like most businesses, the pandemic would have delivered a traumatic blow to its workers.

Based in the rugged Basque region of Spain, the company produces a variety of goods, including sliding doors, plastic parts used in cars and medical devices sold around the world. As the coronavirus ravaged Europe in late March, the Spanish government ordered the company to shut two of its three local factories, threatening the livelihoods of the 210 workers there.

But the Erreka Group averted layoffs by temporarily trimming wages by 5 percent. It continued to pay workers stuck at home in exchange for the promise that they would make up some of their hours when better days returned."

"The concept of the cooperative may conjure notions of hippie socialism, limiting its value as a model for the global economy, but Mondragón stands out as a genuinely large enterprise. Its cooperatives employ more than 70,000 people in Spain, making it one of the nation’s largest sources of paychecks. They have annual revenues of more than 12 billion euros ($14.5 billion). The group includes one of the country’s largest grocery chains, Eroski, along with a credit union and manufacturers that export their wares around the planet."

In the United States, the chief executives of the largest 350 companies are paid about 320 times as much as the typical worker, according to the Economic Policy Institute in Washington. At Mondragón, salaries for executives are capped at six times the lowest wage. The lowest tier is now €16,000 a year (about $19,400), which is higher than Spain’s minimum wage. Most people earn at least double that, plus they receive private health care benefits, annual profit-sharing and pensions."