In terms of innovation, my friend Pat Conaty is usually years ahead, so when he has been talking about something for a while, there is a fair bet, it will soon land somewhere in the UK in practice.
Pat is fascinated by new models of co-operative banking, ranging from loan funds such as the Aston Reinvestment Trust he set up years ago through to Nordic ‘free’ banking – the JAK movement – which has yet to arrive here but ought to be popular. The latest source of inspiration, he tells me, is from Cleveland, USA, where there are some remarkable examples of economic democracy and innovation. And one of the blueprints for a potential new bank in Cleveland, in turn, is the Mondragon Co-operative.
Started in 1956 with five workers in a small shop in the Basque country making kerosene stoves, Mondragon now has over 100,000 worker-owners in some 260 enterprises across 40 countries. It has annual sales of more than 16 billion Euros with a wide range of products–high tech machine tools, motor buses, household appliances and a chain of supermarkets. Its new model supermarkets, Eroski, are spreading well across France, for example. Mondragon also runs its own banks, health clinics, welfare system, schools and the 4,000 student Mondragon University- all worker-owned coops.
‘This is not heaven and we are not angels’ is a common saying in Mondragon, but it remains nonetheless a source of energy and enduring inspiration.
A recent initiative has been to tie up with the United Steelworkers (USW) union in the USA to turn businesses facing closure in the recession into worker-owned cooperatives.
“We have lots of experience with Employee Share Ownership,” explains the USW International President Leo W. Gerard, “but we have found that it doesn’t take long for the Wall Street types to push workers aside and take back control. We see Mondragon’s cooperative model with ‘one worker, one vote’ ownership as a means to re-empower workers and make business accountable to Main Street instead of Wall Street.”
I sense that we Brits tend to cling on to our hierarchies. Pat is a Californian, so he is different. But a little bit of Basque could do us good.