What are the origins of Community Wealth Building?
This is part 1 of a series about Community Wealth Building in Amsterdam. Read the other parts here.
In the United Kingdom and the United States, Community Wealth Building is widely used in cities and regions where economic activity has declined. Towns that used to boast a lively industry, now frequently experience high unemployment, gloom, and anger. These kinds of places have often been in the news in recent years when ‘Brexit voters’ or ‘Trump supporters’ had to be portrayed. We recently wrote an extensive piece on The Value of the City (De Waarde Van de Stad)
When the big companies move away, there’s hope the government will step in. But in America and England, because of the politics of Thatcher and Reagan, there was very little left in terms of government involvement. This is why, in the 1990s. activists began building the local economy in other ways. They had to do it themselves, collectively.
In the USA, there was the Democracy Collaborative, a foundation established by Ted Howard (who attended our conference last year), who became famous with this. They are fighting for a ‘moral and political transformation of the economy, towards a new system that is inclusive, just and ecologically sustainable.’ Because, they say, the current system is ‘immoral and extractive, landing people in the isolation and despair that prevents us from recognising ourselves as agents of fundamental historical change.’
To move towards this new system, Democracy Collaborative ‘ eeks to 'reinvent the idea of ownership and reform the institutions (such as municipalities).' They call for a reassessment of the community ‘in which wealth is democratized, ecological resilience is regenerated, and the marginalized become the core of concern.’ Only then can society become truly democratic again.’
In the UK
A movement also emerged in England at the time, led by the National Organisation for Local Economies (CLES). They, too, are working on 'resilient cities, rather than precarious cities'. Their goal, in their own words, is to counteract the negative effects of 'austerity, financialisation and automation'.
Inspired by Democracy Collaborative, they have 5 key points: in the economy, a few large companies cannot be allowed to own everything: communities and local authorities must also be co-owners; there needs to be substantial investment in neighbourhoods and cities; working conditions must be improved; social policy can be reinforced by government procurement; land and property must serve society. Read more about the National Organisation for Local Economies (CLES)
Mondragon as inspiration
Both the British and American pioneers of Community Wealth Building were inspired by the Basque Mondragon Cooperatives. This new form of enterprise originated in the Basque Country in the 1950s, comprising all sorts of companies in which the workers themselves co-owned the company. Labour has always been more important than capital, and this principle has inspired worker co-ops worldwide.
Mondragon still exists, and remains one of the largest companies in Spain. The founder, Josemaria Arizmendiarietta, wrote a book about his experiences, of which a new English version was recently published (send us an email if you would like to receive a copy as a free PDF).
Mondragon's tens of thousands of workers were not made redundant during the severe economic crisis of 2007-2008, unlike the rest of the people in Spain. Over the years, it has often been demonstrated that the solidarity of the Mondragon members is in fact economically sustainable. For example, employees of an industry sometimes give up part of their wages if this can help to sustain another industry in trouble. And the managers can only earn up to 9 times as much as the lowest salaries. Members invest their wages in their own cooperative bank, the Caja Laboral, which often invests in the co-operation itself.
People can be heard to say about the Mondragon Cooperatives: 'if you are looking for real alternatives to capitalism, you should start at Mondragon'.
Read more: 'Part 2: What is Community Wealth Building today'