Cheney, George, Values at Work: Employee Participation Meets Market Pressures at Mondragon

Abstract

One very important aspect signaling a pro-market ethic at [Mondragon] was an increase in the pay scales from the original 1 to 3 ratio (lowest to highest paid) to the current 70 per cent of market pay for its upper management. The author considers this an important departure from Mondragon's original principles. This may be a departure from original principles at Mondragon but the payment of market-competitive salaries to managers in co-operative enterprises of various kinds anywhere in the world is commonplace. Liberal democratic co-ops based on the Rochdale model, the most common co-op structure in the world, need to be competitive with the capitalist environment in which they operate. Paying market salaries does not undermine Rochdale principles. The radically democratic wage ratios in the early years of Mondragon reflected the communitarian values and Christian egalitarianism of reform Catholicism and not co-op principles. [George Cheney]'s research provides a valuable synopsis of the broad issues facing the Mondragon model, issues that Mondragonians have been debating for several decades. The quotes from interviews he conducted with key players are useful and insightful. His in-depth discussion of workplace democracy is recent and his knowledge of the extensive literature on Mondragon and general workplace democracy issues is excellent. In many ways he tries to be balanced in his assessment of the trends at Mondragon, pointing out both benefits and drawbacks. But his conclusion that management's emulation of trends in corporate capitalism is undermining Mondragon's democratic cooperative achievements is over-stated. He has an American-rooted evangelical interest in workplace democracy that is not translatable to Mondragon. His criticism that Mondragon currently lacks someone to provide a counterbalance to the culture of globalizing capitalism is correct but, again, that earlier commitment came from a founding visionary, working in a different business environment. The managerial elite that drive Mondragon today cannot be expected to be anything more than disciples, keepers of the grail. That they have remained true to the original vision to the flawed degree they have is to their credit. I believe that Mondragon workers would rather have a flawed system of workplace democracy and remain economically viable, than have a radical democratic structure that leads to collapse. What would be interesting and revolutionary is having Mondragon's elite develop a radical corporate model that the great majority of the world's co-ops could use for growth in a capitalist environment. If the impressive mixed-ownership model of second-tier co-ops at Mondragon (workers, consumers, and the community) were adopted by the thousands of co-ops in the world, Mondragon would have caused a revolution in co-operative principles. Likewise, the maintenance of first-tier worker co-ops as the focal point of the co-operative experiment remains radically innovative. The worker co-op element in the world co-operative movement is a small and unimportant element compared to consumer, agricultural, and credit union co-ops. There is nothing else like Mondragon in the world and it remains a radical model for co-operation, even after 50 years. In the last analysis Mondragon, even in its present form, is more democratic, more co-operative, and more egalitarian than anything else in the co-op universe. Cheney's concern that Mondragon may be turning into a capitalist wolf in co-operative clothing is unjustified. Only when Mondragon stops being a co-operative system, can we cry wolf. I doubt that will happen soon.