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Hawaii_Jake's avatar

What ideas have you seen to address the economic crisis of our times?

Asked by Hawaii_Jake (25608 points ) October 22nd, 2012

This fine editorial in The Economist raises some very good ideas for ending our seemingly intractable worldwide economic stalemate. The two responses that were there when I read it are also worth perusing. (I don’t know if the responses change, but the editorial will no doubt remain.)

Have you read anything noteworthy lately you’d like to share with the collective addressing our economic woes?

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LostInParadise's avatar

The best economic idea I have seen is worker coops. They are a very ingenious hybrid of capitalism and socialism. There are a few relatively small worker coops in the U.S. The world’s biggest coop is Mondragon in Spain, with about 90,000 employees.

Worker coops compete for profit, just like under capitalism. The difference is that the companies are owned by the workers. There are no doubt variations among different coops, but this is how it works at Mondragon. To become employed it is necessary to buy shares in the company. If you can’t afford it, the company will allow you to pay over time through paycheck deductions. Every employee has an equal number of shares and has an equal vote. In addition to salary, workers receive equal portions of profits from the stocks they are given.

Workers at Mondragon do not vote directly. They elect a commission. One of the things that the commission at each Mondragon outlet does is to determine the range of salaries. Overall, the ratio of top to least salary is about 10 to 1. This places a restraint on the company’s ability to attract top executives, but it has been doing rather well. Part of the reason is the increased productivity of workers when they are given a share of the profits.

I have seen criticisms of Mondragon from the right and from the left. Those on the right call it socialist and those on the left say it does not go far enough and maintain that it is still embodies all the evils of capitalism. I take it as a good sign when you get opposite arguments from the extremes.

There is a book on worker coops by a university professor that I hope to get around to reading.

Although worker coops do not need an act of government to get started, I can envision passing laws that would favor or at least encourage them. They may eventually emerge on their own out of the ruins of capitalism, but it would be wise not to wait for that to happen.

Qingu's avatar

The federal government should give aid to the states, so that states can avoid firing public-sector workers.

If you look at the stats, public sector job losses have been the major drag on the economic recovery. If public sector jobs held steady, unemployment would be much lower. If those people had jobs, they would spend their income on goods and services, and the increased demand would cause businesses to hire more workers in response.

This would temporarily increase the deficit. But that’s okay. Dealing with the deficit is lower priority than dealing with the unemployment crisis. You need to solve unemployment before you can meaningfully deal with the deficit anyway.

janbb's avatar

Paul Krugman, the economist believes that more stimulus is needed and that not enought was done.

ETpro's avatar

The article strikes me as a repackaging of the right-wing agenda in terms meant to sound “progressive” but preserve the regressiveness the “Wealth Creators” love. Lock the world’s wealthiest man in a room, feed him and provide for his needs and comfort, but deny him any contact with the outside world, and see how much wealth he creates. The notion that letting the wealthiest among us keep all their money because they magically create more is pure propaganda from the wealthiest among us, and this article falls victim to that fantasy, or more likely was commissioned by those who will profit from the falsehood being perpetuated.

Skaggfacemutt's avatar

Maybe the planet’s population has just reached the point where there are too many people competing for too little resources. There might not be a solution at this point. Going back to basics would help. Stop fighting foreign wars, giving aide to other countries, importing goods and services from other countries. Individually, we can plant a garden, learn to can and freeze the yield, keep chickens. Also stop buying into all the stuff that society thinks we should have – electronic devices up the wazoo that cost a fortune every month just so that you can tweet what you ate for lunch, or send your friend a picture of your foot.

And on the top of my list would be to cut our top-heavy government in half!

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