Editorial

share this segment by right‑clicking icon to copy linkFour Ways to Look at The Industrial Commons

Elias Crim

I’ve not yet been to Mondragon, nor have I visited the dense co-op scene in Italy’s Emilia Romagna region. But I’ve come about as close as you can get without leaving the continental U.S.

Earlier this week I joined a group from the Francesco Collaborative visiting textile country in western North Carolina. We spent two days in Morganton (“the gateway to Appalachia”) at the site of The Industrial Commons (TIC), where cooperativism, the green economy, and inclusion have been taken to a remarkable level.

What we saw at TIC could be described in several different ways. Here are four:

1. As an emerging regional economic ecosystem and supply chain

The Industrial Commons’ list of sponsored projects includes the Carolina Textile District, a resource hub and a community of manufacturers. Within a 75-mile radius, the CTD comprises 25 participating textile mills, employing 2,500 workers. Its services include industrial sewing programs, help with product development, testing / certification, and design. The vision here is to help recover and renew one of western North Carolina’s legacy industries.

With a staff of 25 and a $3 million annual budget, TIC is also the funder and incubator of worker co-ops and social enterprises employing over 100 workers: Opportunity Threads, Material Return, Good Books, Collection, TOSS Studio, with more in development.

2. As an experiment in the green and circular economy

With textile manufacturing accounting for 12% of global carbon emissions, that’s a lot of textile waste headed for landfills. One powerful response is the model of “custom circularity” offered by Material Return, a TIC member co-op founded in 2017. The circular process involves collecting and custom sorting of textile waste, processing it, spinning it into yarn, and turning it into fabric with which their partners in the Carolina Textile District create finished products.

3. As a connected group of liberatory and humanizing workplaces

Through a mix of open book management, worker committees, and a coaching supervision program, TIC’s enterprises achieve a high degree of transparency and participation. With a large Guatemalan Mayan population in Morganton, a high proportion of worker-owners are from that community, as well as other communities of color. The workers’ sense of being part of something unusual in their town comes through. (When asked by a member of our group why he felt loyal to his co-op, one worker responded, “It’s just my FOMO — these businesses are going places and I don’t want to miss out!”)

4. As a vision of a future social economy

In their quest to root local prosperity and for the long-term, TIC’s plans include developing both land and housing owned by workers, social co-ops, a dedicated worker training space, and a community makerspace, to offer only a partial list.

Ultimately, the TIC vision is to become “the gold standard for our work on defining, promoting and living out environmental and human rights standards for the U.S. textile industry.” 

share this segment by right‑clicking icon to copy linkUnpacking the “Partner State”

A Conversation with John Restakis about Civilizing the State (Part One)

Júlia Martins Rodrigues

After almost two decades as the executive director of the BC Co-op Association and a stint as executive director of Community Evolution Foundation, John Restakis currently dedicates his time as a lecturer in Alternative Economies for Social Transformation at the University of Victoria, and to community economic development in Vancouver. He is the author of Humanizing the Economy: Co-operatives in the Age of Capital (2010) and a co-founder of the Synergia Institute.

In our previous issue, Ownership Matters published a review of John Restakis’ Civilizing the State: Reclaiming Politics for the Common Good (2021). Here, we have invited the author to join us and asked him to expand on some of the critical aspects of his conception of the Partner State concept.

Commentary

share this segment by right‑clicking icon to copy linkEquity Funds Needed to Further Worker-to-Owner Buyouts

Bruce Dobb and Tomás Durán

The silver tsunami has begun. More and more business owners from the Baby Boom generation are looking to sell their businesses and retire. Among America’s small manufacturers, for example, 125,000 business owners are on the cusp of retirement. Those businesses represent millions of family-wage jobs that could be lost forever.

With so many business owners looking to sell, it’s an opportune moment for employee buyouts. However, when employees are competing with corporate or private equity buyers, they often lose the deal because they don’t have ready cash for a down payment. That cash is essential for accessing the Small Business Administration (SBA)-backed loans that are used for about 75 percent of small business ownership transitions.

In a typical example, our organization, Concerned Capital, recently worked with a family-owned medical supplies packing and shipping company in the metropolitan DC area. The couple who owned the business, which had about $5 million in revenue, wanted to sell it to the employees. Multiple social investors — a CDFI, a nonprofit, and a social impact fund — were prepared to loan the employees the money to buy the business, but the employees needed to raise $150,000 in equity in order to access the loans. While the employees searched for the cash, a rival company bought the firm and closed in two weeks.

We run into this challenge over and over again. The worker-to-owner financing ecosystem has a significant credit gap: equity financing. What’s needed is an equity vehicle that fits snuggly with existing SBA regulations, providing the 10 percent cash down payment on a deal otherwise financed through debt. We believe, along with our partners at the Democracy at Work Institute, that states can create equity funds to satisfy this need using the State Small Business Credit Initiative.

In the last several years, an explosion of debt offerings have moderately increased transitions to employee ownership. Some of this growth is a direct result of the Main Street Employee Ownership Act of 2018, which resulted in the SBA adopting programs and rules designed to assist with Employee Stock Ownership Plans (ESOPs) and worker-owned cooperative transitions. Impact investment groups, community development finance institutions (CDFIs), and a range of “social benefit” lenders offer a wide range of debt instruments for worker-to-owner deals, including subordinate debt and very low interest rate loans. With greater access to equity, these debt offerings could be leveraged more effectively and the pace of employee-ownership transitions significantly increased.

Books

share this segment by right‑clicking icon to copy linkThe Cosmovision We Need

Political Solidarity Economy (2021) by Jorge Santiago

An importance voice from the global majority, Jorge Santiago is a native of a key landscape in the birth of the solidarity economy movement in the 1990s — the state of Chiapas, Mexico. This Mayan region contains 4.2 million inhabitants from many different ethnic groups, including the Afrodescendants.

Born in 1943, Santiago first set out to be a priest, spending four years in Rome studying theology before the impact of neoliberal forces on his home region pulled him out of the church and into movement building.

He joined DESMI (Desarollo Económico y Social de los Mexicanos Indígenas) in 1974 and spent the next 34 years helping develop alternative economic strategies in over 200 indigenous communities in Chiapas.

His new book has the feel of a first-hand report on the intertwined stories of the rise of the solidarity economy and the movement for indigenous rights, perhaps most famously championed by the Zapatista Army of National Liberation.

The economy Santiago describes is not only an alternative to neoliberal capitalism but something closer to a cosmovision, i.e., the conception that indigenous peoples have of the physical and spiritual world and the environment in which they conduct their lives. It is also a global vision of mutual support, land, knowledge, and an understanding of the power of orality.

Thus we’re speaking here of the defense and care of the earth and indigenous territories within the framework of food sovereignty and solidarity economics. As the author puts it, there is no agroecology without a political solidarity economy.

The book’s themes are: seven ways of understanding solidarity; the solidarity economy in Chiapas; economy and currency; Zapatista autonomy as an example; and the work of DESMI.

The foundation of the solidarity economy, the author argues, is in networks and their collective strength through participation in the whole. We aim to unite all our experiences in order to build through practice and collective learning.

The movement, Santiago, says, is not about putting the government on trial but about taking ownership over governance and with a transnational approach.