Capitalism Co-opts Co-ops

A sign of insanity they say is doing the same thing over and over again and expecting different results so why is it that many progressives ignore the informed opinion from over 150 years ago of the Chartist leader, Ernest Jones who back then observed:

 “I contend that co-operation as now developed, must result in failure to the majority of those concerned, and that it is merely perpetuating the evils which it professes to remove…That the co-operative-system, as at present practised, carries within it the germs of dissolution, would inflict a renewed evil on the masses of the people, and is essentially destructive of the real principles of co-operation. Instead of abrogating profitmongering, it re-creates it. Instead of counteracting competition, it re-establishes it. Instead of preventing centralisation, it renews it – merely transferring the role from one set of actors to another…your co-operative ranks are thinned, your firms find, one by one, they can no longer in make the returns equal the expenses, they cannot sell as cheap as the capitalist, they can therefore no more command the market, their co-operative fires die out in quick succession, stores and mills close over their deluded votaries – and the great ruin will stand bald, naked, and despairing in the streets.”

Just exactly what has changed since these words were written? Not only have events proved Ernest Jones right, but many others have also agreed with his view. Karl Marx, Jules Guesde, Rosa Luxemburg, Murray Bookchin, Bertell Ollman, Andrew Kliman, to name just some. So why are the likes of Richard Wolff still assuring people that cooperatives are the pathway to a new society?

Surely we should have learned by now that it is far easier and less painful to learn facts by knowledge and reasoning than by the experience of failure which only brings despondency and despair. Genuine worker self-management is only possible in a socialist society. Worker self-management models being currently adopted and promoted by many cooperatives are a local and defensive tactic. These coops exist and are part of a capitalist economy that they do not control. Consequently, the workers’ self-directed activity remains fundamentally constrained by capitalist competition and the market. There have been many examples of workers’ cooperatives that went wrong, there have even been some that have “succeeded” – in capitalist terms that is.  All that they have accomplished, however, has been to transform themselves into profitable capitalist enterprises, operating in a similar way to other capitalist firms. Any impartial inquiry into the development of the Mondragon model clearly demonstrates this fact and they freely admit it.

 “We are private companies that work in the same market as everybody else. We are exposed to the same conditions as our competitors, explained a one-time Mondragón human-resources worker. 

Noam Chomsky also understands the limitations:

“Worker ownership within a state capitalist, semi-market system is better than private ownership but it has inherent problems…Take the most advanced case: Mondragon. It’s worker owned, it’s not worker managed, although the management does come from the workforce often, but it’s in a market system and they still exploit workers in South America, and they do things that are harmful to the society as a whole and they have no choice. If you’re in a system where you must make profit in order to survive. You are compelled to ignore negative externalities, effects on others.”

Applying a Marxian approach and see that all the fundamental categories that define capitalism – generalised wage labour, commodity production (means of production were bought and sold between enterprises as well as final goods), money, profits, capital accumulation, class monopoly of the mean of production etc – were also to be found. Within this model wage labour would still function and it follows that so too would capital. Capital accumulation out of surplus-value would be the overriding imperative of his system.

The Co-operative movement has to some extent lost sight of the great aim which Robert Owen had in view, which was to raise the whole of the members of the community by reorganising the forces and circumstances which governed their lives.  — Co-operative Annual, 1902.

The human community cannot be attained by forming partial and separated communities that never pose an obstacle to capital

Since the beginning of the labour movement, groups of workers have tried to escape from their condition as wage earners by setting up production or consumption cooperatives. If some of them viewed cooperatives as an aim in and of itself, others considered it a means of self-defence against management repression. Sometimes, cooperatives have been interesting places for social experimentation but, in most cases, their evolution has been negative.

In certain areas, for example in Euskadi [Basque Country], paternalistic reformers compensated for the backward economy under the Franco dictatorship by setting up the famous Mondragon Cooperative, which today has become a large and well-known holding company. There are other cooperatives all throughout Europe, where the exploitation of the workers does not differ from the exploitation in any other company. The fact that cooperatives are entering the “free” market implies that they accept the rules of competition set by the other companies in their sector of the globalised economy. This situation forces them to adopt capitalist forms of exploitation of the workforce and an iron leadership, in contradiction with the initial postulates of cooperation and workplace “democracy”. Even if we consider that the development of cooperatives can, at a given moment, be a method for self-defence or for short-term survival, at no point should we allow them to sidetrack us from our main activity, which is the anarcho-syndicalist struggle in the workplace in order to transform society and the economy as a whole. Above all, we do not think that the capitalist system can be gradually changed by the multiplication of cooperatives.


The self-management concept inspired by the anarchist collectives in Spain (1936-39) – but also used in Tito’s Yugoslavia or in Algeria – seems very ambiguous to us nowadays. It was always necessary to add adjectives, e.g. “generalised self-management”, in order to avoid confusion, since many reformists spoke about self-management as a synonym for workers co-management in capitalist companies – in short, the cooperation of the workers in their own exploitation.

The desertion of employers from companies, for example in Argentina, permitted workers to take over and begin production without bosses. This seems to us more coherent with a form of direct management of the enterprise. Self-management is often the result of a confrontation between workers and employers who are unable to keep their business viable. The phenomenon of self-management must be generalised if we do not want it to perish. If they don’t take part in a wide dynamic of social struggles, experiences in self-management will be a minority and will be progressively reduced or recovered by the system. Our egalitarian ideal implies that we continue struggling until absolutely no one suffers from exploitation. The tools of self-management and of cooperatives can only be, in the best of cases, tools to struggle towards libertarian communism, which implies generalised socialisation of the means of production and distribution, in a federation of free municipalities.

Many radicals propose cooperatives, which they hope could constitute an alternative to large corporations and ultimately replace them. Murray Bookchin welcomed this development, but as time passed, he noticed that more and more those once-radical economic units were absorbed into the capitalist economy.

 While cooperatives’ internal structures remained admirable, he thought that in the marketplace they could become simply another kind of small enterprise with their own particularistic interests, competing with other enterprises, even with other cooperatives.

Indeed, for two centuries, cooperatives have too often been obliged to conform to marketplace dictates, regardless of the intentions of their advocates and founders. First, a cooperative becomes entangled in the web of exchanges and contracts typical. Then it finds that its strictly commercial rivals are offering the same goods it offers, but at lower prices. Like any enterprise, it finds that if it is to stay in business, it must compete by lowering its prices in order to win customers. One way to lower prices is to grow in size, in order to benefit from economies of scale. Thus growth becomes necessary for the cooperative—that is, it too must “grow or die.” Even the most idealistically motivated cooperative will have to absorb or undersell its competitors or close down. That is, it will have to seek profits at the expense of humane values. The imperatives of competition gradually refashion the cooperative into a capitalistic enterprise, albeit a collectively owned and managed one. Although cooperation is a necessary part of an alternative economy, cooperatives by themselves are insufficient to challenge the capitalist system.

Indeed, Bookchin argued, any privately owned economic unit, whether it is managed cooperatively or by executives, whether it is owned by workers or by shareholders, is susceptible to assimilation, whether its members like it or not. As long as capitalism exists, competition will always require the enterprises within it to look for lower costs (including the cost of labor), greater markets, and advantages over their rivals, in order to maximize their profits. They will tend ever more to value human beings by their levels of productivity and consumption rather than by any other criteria.” Janet Biehl,a student of Bookchin, explained.

Bookchin and Biehl were confirming what Marx had said:

 As long as capitalism exists, the world market will exist, and thus the law of value will exist.  In other words, what will exist is the need to compete effectively, to produce as much as possible as cheaply as possible. There cannot be socialism in one country, much less in a single cooperative or network of cooperatives.  Even if the members of a cooperative or network of cooperatives are nominally their own bosses, it follows from the continued existence of the value relation that, as Marx put it in his discussion of the fetishism of the commodity, “the process of production has mastery over [human beings], instead of the opposite.” (Capital, Vol. I) 

A cooperative must still buy its inputs and sell its outputs on the world market, competing with every other producer of the same product.  The economic laws of the larger system will not allow it. If you buy from the capitalist world “outside,” you also have to sell to it in order to get the money you need to buy from it, and you will not sell anything if your prices are high because your costs of production are high. And if you have debts, you have to repay them.  It cannot decide to pay much more nor to greatly change conditions of work to implement more humane ones, without putting itself out of business.  Society remains under the despotic direction of capital – even if it is the workers’ rather than CEOs who serve as the new personifications of capital.  Enlarging the space of the commons or whatever, unfortunately, cannot be done. If you are in a capitalist system, you cannot just issue a mission statement to produce for need, or a policy promise to refrain from laying off workers. Cutting costs and maximizing output are the keys to enterprise survival. Cooperatives cannot break the laws of capitalist production. The most important law compels an enterprise, whoever owns or “controls” it, to minimise costs in order to remain competitive, and therefore to lay off inefficient or unnecessary workers, speed up production, have unsafe working conditions, produce for profit instead of producing for need, etc.

 Progressives cooperative proponents are looking backwards to the supposed idealised Golden Age of handicraft capitalism and not forward to a socialist society. Many forget that the Bank of America actually started out as a community bank in San Jose, California—then a small agricultural town—providing banking services to poor, mostly Italian immigrants, who in those days experienced racist discrimination and were denied banking services by other commercial banks of the time. Others forget that Walmart began as a mom and pop store.  The evolution of those into the corrupt corporate monsters that they are today was no accident, nor did it simply reflect ill will on the part of its owners. Rather, it reflects the objective laws of capitalist production that Marx analysed in “Capital”  Marx hailed workers’ cooperatives as harbingers of the new society, but he was also acutely aware of this problem. So in volume 3 of Capital, he cautioned that, as long as they exist within capitalism, the cooperatives “naturally reproduce in all cases…all the defects of the existing system, and must reproduce them…the opposition between capital and labour is abolished here…only in the form that the workers in association become their own capitalist.”

In other words, the workers end up exploiting themselves.

Microfinance is built on a false belief that credit is the most vital need of the marginalised. One of those who has thoroughly studied the phenomenon, Thomas Dichter, says the idea that microfinance allows its recipients to graduate from poverty to entrepreneurship is inflated.

He sketches out the dynamics of microcredit: “It emerges that the clients with the most experience started using their own resources, and though they have not progressed very far—they cannot because the market is just too limited, they have enough turnover to keep buying and selling, and probably would have it with or without the microcredit. For them, the loans are often diverted to consumption since they can use the relatively large lump sum of the loan, a luxury they do not come by in their daily turnover.” He concludes that “Definitely, microfinance has not done what the majority of microfinance enthusiasts claim it can do—function as capital aimed at increasing the returns to a business activity.”

The biggest problem is that people who get these small loans usually start or expand a very simple business. The most common business for microfinance is simple to retail—selling groceries, where there are often too many people, fierce competition, and where they don’t really earn enough money to get out of poverty.

Our job in the World Socialist Movement is not to tell fellow workers the way to live their lives under capitalism, but to demonstrate that a non-capitalist society is actually possible to achieve. Many on the Left engage in a lot of loose talk about “transitional societies” and “workers’ states”.  Capitalism cannot “become” a socialist society; it cannot gradually cease to exist as the socialist society gradually comes into being. When Marx turns to the first phase of communist society, he envisions a sweeping revolutionary transformation of the relations of production, from the very start.

Democratic political action by a majority that wants and understands socialism is the way we see socialism coming about, not by “socialistic” communes or cooperatives gradually becoming more and more self-sufficient and eventually squeezing out entirely capitalist production for profit. This argument amongst those who want a class-free money-free society of common ownership and democratic control goes back a long time, right back to the origins of the modern socialist movement in the first part of the last century. On the one side was Robert Owen, who spent (and lost) the fortune he had made as a textile capitalist on founding communistic colonies in Britain and America. On the other were the Chartists, whose position was later supported by Marx and Engels, who argued that political action for social change was the most effective way to achieve a cooperative commonwealth.

It might be more pleasant to live in a communistic community but the trouble is they never last. Not because communism is against human nature as opponents claim, but because they can’t escape from the surrounding capitalist environment. Far from them overwhelming capitalism it’s been the other way round. Either they isolate themselves as much as they can from capitalism, in which case they are only able to offer a very frugal existence, or they engage with the surrounding capitalist economy, for instance by selling their products, in which case they get more and more sucked into capitalist ways of doing things. The kibbutzim in Israel are a good example of this. Some of them did start out as communities that didn’t use money internally and in which affairs were run democratically with everyone having an equal say. But over the years they have not only competed successfully on the capitalist market as sellers; they have also taken to employing non-members as wage workers, i.e. become capitalist enterprises.

We are not saying that people shouldn’t live in communistic communities if they wish to and are able to, only reminding that it’s not the way socialism is going to come about. We can imagine that, when socialists are measured in millions rather than thousands so that it has become clear that sooner or later socialism will be established in the near future, people will be making all sorts of plans and experiments in anticipation of the coming of socialism and that this will include communal living in the countryside as well as in towns, but we are not there yet since this presupposes the existence of a mass socialist movement which must come first. So at the moment, we need to concentrate on spreading socialist ideas rather than promoting experiments in “socialist” living.

The cooperative movement is a form of activity that is of use to some members of the working class, but not all and its popular proponents such as Richard Wolff are a hindrance to the campaign for socialism. At most co-ops serve as a means of surviving the rigours of the capitalist economy. Genuine cooperative societies (in which the members themselves carry on the work and own and share in common) have invariably failed to make headway against the forces of capitalism. The so-called consumers’ cooperatives that have made headway possess no real element of cooperation. They are merely joint-stock capitalist trading concerns owned by small investors and exploiting their employees like capitalist concerns in general. The outlook engendered by the cooperatives is no more favourable to socialist propaganda than is the outlook of non-cooperators. Support of such blind-alley activities confuses the minds of the workers by making them think that the social problem can be solved within capitalism and without socialism.

Capitalism is a mode of production not a method of management. Proponents of the cooperative vision aspire towards enterprises that are small, democratically managed by their workforces and/or local communities and ecologically balanced with a need to be “non-enterprises such as consumer cooperatives, credit unions and municipal banks, ownership of industry by towns and cities and the state  (municipalisation and nationalisation), and NGOs, along with the many proposed worker-run enterprises (producer cooperatives).  At the same time, these approaches do not call for the abolition of the market, accepting competition among enterprises, production for profit rather than use, and the use of money. They project workers’ enterprises competing with each other to sell their goods in the most profitable way. Some propose a workers’ enterprise sector side-by-side with a corporate capitalist sector. Most imagine the continuation of a national state to regulate the overall market. Since the market and the state are accepted, the result must be a reformist, non-revolutionary, program. This is a belief that such an improved society could be reached by using the existing market (starting up new, worker-managed, industries, etc.) and without challenging the existing state.

One of the consequences of believing that big is bad is that certain key aspects of capitalism such as markets, money, and buying and selling come to be seen as acceptable provided they only exist locally on a small scale. “Market socialists”  envisage their model as the alternative to existing society of one where there might be no profits, exploitation or a centralised state but there would be local cooperatives and small businesses producing for local markets, local currencies, and small-scale trading between local communities.

In other words, a small-scale, decentralised market economy where goods and services would be bought and sold for use, not profit. We can’t go back to this which Marx called “petty commodity production” and if we did, it would develop again into the large-scale commodity production that is capitalism.

But so far as co-op leaders hold out hopes to the workers that their support will help towards a new order of society, or will even provide an escalator to reach it, they are practising deceit. The only way out for the workers is to organise politically for that purpose. A special objective requires a special organisation for its achievement. However, the objective must not be obscured by lesser things of little or no importance.

 We stand a society based on the abolition of remuneration in the form of wages and an economy based on the destruction of the wage system, and a de-linking of the value of labour in production from the distribution of society’s wealth to its members. It is not possible anyway to measure an individual’s contribution to production.  Production is largely social. The contribution of an individual is very difficult to isolate from the contributions of countless others that make work possible”. Any such attribution can only be arbitrary, as in the Parecon blueprint, of having co-workers judge each other’s work would turn gossip and infighting at work presently from an annoyance into a contest over wages.

 The assets of a co-op do not cease being capital when votes are taken on how they are used within a society of generalised commodity production and wage labour. That is to say, there remains an imperative to accumulate with all the drive to minimise the labour time taken to do a task this requires, even in a co-op.

Since the 1940s or 50s, the consumer cooperatives, like all businesses under capitalism, were increasingly forced to centralise and concentrate capital, due to improved transportation facilities and new retail forms. This trend manifested itself partly in the declining number of cooperatives, and in the increasing membership strength per cooperative unit. Often the average age of members rose, as elderly members remained loyal to their cooperatives, and younger ones failed to materialise.

Generally, consumer cooperatives were doomed by inhibitions arising from their pioneering role. Established in an era when small shop-owners controlled retailing, they were initially at an advantage. Their larger operations were more economically rational and offered advantages of scale. As a response shopkeepers joined forces in chain stores, central purchasing organisations, etc. However, new sales systems – including self-service stores, supermarkets, shopping centres and the like – were invented. These new types of businesses featured brand names, systems of accumulated redeemable credits, low prices, and enticing advertisements. As a result, the competitive advantage of the consumer cooperatives deteriorated visibly. The surplus base (surplus divided by sales) decreased, along with the dividends for members and the opportunities for innovation and investment.

Many consumer cooperatives encountered financial difficulties and faced a serious dilemma in their effort to avoid bankruptcy: either they could merge with a regular capitalist business, become a limited liability company, or borrow substantial amounts from banks – in each case, they ceased to be autonomous cooperatives; or they could counter the rising competition through modernisation and operational expansion – thereby increasing the considerable social distance between members and administrators, as well as further reducing involvement among the members and thereby undermining the organisation’s cooperative nature. On a world scale, consumer cooperatives have either not been doing well or they have morphed into retail industries without members democratically controlling the business. 

Cooperatives are usually portrayed by their proponents as more satisfying business arrangements than those found in the hierarchical power structures of corporate or state capitalism. Some have even argued that, if allowed to develop, they would fundamentally alter capitalism in favour of the working class and simultaneously facilitate the instigation of new forms of social ownership and economic democracy. Proponents claim that cooperatives are owned and controlled by their workers allowing no outside shareholders’ and no “bosses” While a more politically motivated supporter argue that the co-op demonstrates that ordinary working people can evolve democratic enterprise structures which have a fair chance of success; they can come to recognise that professional management is just as necessary in a co-op as it is in a capitalist operation: they can come to behave with unusual forbearance and responsibility in the matter of wage rates and to identify quite closely with the longer-term enterprise goals.

What both of these two claims conveniently hide from workers is the uncomfortable fact that capitalist notions of profit-making and commodity production are intrinsic features of cooperatives, which have to function within a world capitalist market. If, for whatever reason, they are prepared to misrepresent their character and function — and it is noticeable that they support the wage system and therefore the exploitation of the working class.

It is because cooperatives raise capital from financial institutions, pay rent to landlords, produce commodities for profit, and pay wages to workers — as well as face all the problems inherent in a market economy — that socialists reject the claim that they either represent the Utopian idealism of Robert Owen or are organisational forms approximating to socialism. Cooperatives are in practice no different from any other form of capitalist venture: if profits cannot be secured, if interest or rent cannot be paid on time, then bankruptcy and unemployment are the end result. A high failure rate throughout the twentieth century has shown quite clearly that their lifespan as profit-making businesses is often very short.

But underlying all the rhetoric in support of cooperatives is an unquestioned assumption that capitalism, in which co-operatives have to market their commodities, is crisis-free. Cooperatives are not “productive islands” distinct from other forms of capitalism but part of a chain of production and distribution, buying and selling commodities with no other reason but to make a profit. So when an unpredictable crisis erupts — and they are unpredictable precisely because of the anarchy inherent in the commodity production itself — it can hit cooperatives as hard as any other form of business.

But what of the apologists themselves? Most support for co-operatives emanates from academic economists and sociologists, journalists and politicians, all of whom see in the cooperative movement a means to mitigate or play down the class struggle. It is not an oversight that these writers fail to urge workers first to abolish capitalism and then to set up cooperatives. The truth is that for the academic or politician the wages system is taken as an article of faith; a perennial economic arrangement never to be questioned. All their pronouncements about cooperatives are couched in the language of commodity production and exchange.

The class struggle exists because the interests of wage and salary earners, on the one hand, and the imperatives of profit and accumulation dictated by capitalism on the other, are antagonistic and diametrically opposed. Cooperatives do not give workers security of employment; do not free them from exploitation, and do not allow the luxury of producing goods outside the parameters of commodity production. Cooperatives under capitalism cannot be organised in any other way. The products they make are available only to those who can afford them — what workers can pay for and what they want are two completely different things. Only the capitalist class get all the services they want. The profit system, whether unquestioned or defended by apologists for worker cooperatives, acts as a restraint on production.

Given the sordid and competitive environment in which the working class are exploited, it is quite understandable that some are seduced by the idea of cooperatives. Why, after all, should we not produce socially useful products to the best of our ability and be involved fully in the production process? But it is a mistake to believe that workers can achieve this by retaining the wages system and commodity production. Cooperatives have to produce for markets and are therefore dictated to by them. If workers really wish to work cooperatively, freed from the constraints and pressures of the market, then the only way to do so is within a social system conducive to cooperation. Capitalism plainly cannot provide this framework and workers should realise this fact and organise politically for its abolition.

 The only difference is that the cooperative company will always be at a disadvantage when compared to the capitalist business enterprise, even when the former has as much capital as the latter. The cooperative undertaking, because it is cooperative, cannot press any surplus value out of its members, and therefore its capital will not grow. On the other hand, it has to spend its main strength fighting strong capitalist concerns, while it is just that fight of competition that fixes the prices of the products

The miseries of laissez-faire capitalism not only produced a socialist movement but also various attempts on the part of workers to ease their conditions by non-political means. Apart from trade unionism, a cooperative movement came into being as a medium of escape from wage labour and as a vain opposition to the ruling principle of general competition. The precursors of this movement were the early communist communities in France, England and America, which derived their ideas from such utopian socialists as Owen and Fourier.

Producers’ cooperatives were voluntary groupings for self-employment and self-government with respect to their own activities. Some of these cooperatives developed independently, others in conjunction with the working-class movements. By pooling their resources, workers were able to establish their own workshops and produce without the intervention of capitalists. But their opportunities were from the very beginning circumscribed by the general conditions of capitalist society and its developmental tendencies, which granted them a mere marginal existence. Capitalist development implies the competitive concentration and centralisation of capital. The larger capital destroys the smaller. The cooperative workshops were restricted to special small-scale industries requiring little capital. Soon, the capitalist extension into all industries destroyed their competitive ability and drove them out of business.

Consumers’ cooperatives proved to be more successful and some of them absorbed producers’ cooperatives as sources of supply. But consumers’ cooperatives can hardly be considered as attempts at working-class control, even where they were the creation of working-class aspirations. At best, they may secure a measure of control in the disposal of wages, for labourers can be robbed twice – at the point of production and at the marketplace. The costs of commodity circulation are an unavoidable incidental expense of capital production, dividing the capitalists into merchants and entrepreneurs. Since each tries for the profit maximum in its own sphere of operation, their economic interests are not identical. Entrepreneurs thus have no reason to object to consumers’ cooperatives. Currently, they are themselves engaged in dissolving the division of productive and merchant capital by combining the functions of both in the single production and marketing corporation.

The cooperative movement was easily integrated into the capitalist system and, in fact, was to a large extent an element of capitalist development. Even in bourgeois economic theory, it was considered an instrument of social conservatism by fostering the savings propensities of the lower layers of society, by increasing economic activities through credit unions, by improving agriculture through cooperative production and marketing organisations, and by shifting working-class attention from the sphere of production to that of consumption. As a capitalistically-oriented institution, the cooperative movement flourished, finally to become one form of capitalist enterprise among others, bent on the exploitation of the workers in its employ, and facing the latter as their opponents in strikes for higher wages and better working conditions. The general support of consumers’ cooperatives by the official labour movement – in sharp distinction to an earlier scepticism and even outright rejection – was merely an additional sign of the increasing ‘capitalisation’ of the reformist labour movement. The widespread network of consumers’ cooperatives in Russia, however, provided the Bolsheviks with a ready-made distributive system which was soon turned into an agency of the state.

The division of ‘collectivism’ into producers’ and consumers cooperatives reflected, in a sense, the opposition of the syndicalist to the socialist movement. Consumers’ cooperatives incorporated members of all classes and were seeking access to all markets. They were not opposed to centralisation on a national and even international scale. The market of producers’ cooperatives, however, was as limited as to their production and they could not combine into larger units without losing the self-control which was the rationale for their existence

The general practice of economic cooperation today is of a joint-stock enterprise, on the part of a number of petty shareholders. Modern industrial cooperation is, therefore, little more than playing at capitalism. Under existing conditions, no business enterprise can succeed except on competitive lines, and so the cooperative societies of today simply represent cooperation to compete, with capitalist concerns, on capitalist conditions. They must successfully compete or go under. Thus, while conferring some slight advantage on their members, cooperative societies have little connection with the present working-class movement, except where they are subsidiary to that movement and serve to help supply it with funds; as in the case of the co-operative societies of Belgium.

A society is not transformed by the force of words alone,

If factories anywhere fell into the hands of workers’ committees tomorrow what would happen? Since workers at the moment all over the world are committed to capitalism because they have not yet grasped any alternative method of organising society, these factories under ‘workers’ control’ would continue to produce commodities for sale. It would simply be a question of the workers driving themselves, holding their own whips, managing their own exploitation. The factories will be run on socialist lines only when the goods they turn out are no longer for selling on the internal and world markets and when the people working in them have no need for wages.