3DN Self-Help Corporation

From P2P Foundation
Jump to: navigation, search


Description

"The self-help corporation is a simple, practical and economical way to alleviate poverty. It does not require public consensus, expensive government programs or massive charitable fund raising. One can be started now, by anyone, anywhere in the world. The business plan uses the proven techniques of asset pooling and diversified ownership for capital acquisition.


From one point of view, it is no different than the pooling of resources often required of entrepreneurs bootstrapping a new business. From another point of view, it is no different than a public offering of shares to raise captial. Perhaps the only innovation is applying those concepts together in a different context. The participants own the organization that owns the assets that allow the participants to produce goods and services for their own consumption.


Poor people are poor because they do not have skills that can be marketed in the “market economy” or their labor is valued by the market economy at a level that does not provide them adequate resources for a decent standard of living. They are not, however, without skills and resources. In particular, they possess the skills and available labor to produce basic necessities.


Pooling Resources


Take an arbitrary 100 people who have inadequate resources. These circumstances exist for billions of people on earth because there are no jobs available and because they do not own land. However, to demonstrate how a self-help corporation might work, just imagine any 100 of those people any place in the world.


If these 100 people agreed to cooperate in acquiring basic necessities, they could form a self-help corporation. When they start, all 100 have varying opportunities to earn small amounts of cash working odd jobs. Rather than each individual or family struggling to find food every day, they would pool their resources and buy food in bulk. They could also pool their housing resources. 4 people could prepare the food for all the participants. Another 4 people would keep the facilities clean. Another 4 people are assigned to mending and laundering clothing and another 4 people are assigned to look after the young children and see that the older children get to school.


In the resulting organization, 16 people are supplying support services to 100. 84 of the participants can still seek odd jobs. The quality of life is better because all 100 have regular meals, a clean safe place to live, and a lower cost of living. There may even be cash to buy better clothing, and make arrangements for education and health care. Because of the stability provided by the corporation, the participants seeking odd jobs are better employees and, therefore, will have an easier time finding work.


Bypassing the Money Limitation


For conceptual purposes you can compare a self-help corporation to the immigrant family that starts a restaurant as a family business. Father takes odd jobs to supplement the income, mother works in the kitchen and the kids wait tables. Everyone involved gets fed and a place to sleep but most of the cash goes back into the business. In this way, and with other kinds of businesses, many immigrant families in the US have bootstrapped their way to financial security. A self-help corporation has the same goal. Further, to the extent that cash proceeds can be reinvested in the business, and not disbursed to pay for labor, a self-help corporation has the same economic advantage.


Unlike the immigrant family, a self-help corporation will not have the family ties to hold the organization together and ensure that each member is treated fairly. Some other mechanism must be employed to motivate the participants to work on a regular basis. That will require assurance that those whose labor provides the most value also receive commensurate rewards. Since a self-help corporation does not pay salaries, it will need a substitute measure of worth.


I have called this substitute measure "shares" but they can also be thought of as an internal currency. Like other currencies, they will only have value to the extent that they are redeemable for goods and services. The corporation would start with basic services that are 1) marketable to the general public and 2) useful to the participants. These services include preparation of food, laundry services and child care services. See Economics of Integrated Production.


The shares also carry the traditional function of stock in a company. To the extent a worker does not redeem all of their shares, they have voting rights. At a minimum, the worker/shareholders would be able to elect members of a Board of Directors. The corporation could, however, be structured to be much more democratic than a typical business corporation. In addition, the shares will carry rights in the assets in the event of liquidation that will give assurances to workers that they can safely save shares they have earned for later use.


How the Corporation Would Work in a US city


The initial target customer is anyone working long hours for low pay.


The initial target work force is anyone who cannot currently find full time employment.


The initial facility would be a commercial kitchen, a laundry facility and space for caring for young children.


The corporation will offer the customer three meals a day and laundry services. The cost to the customer will be lower than they would pay to feed themselves and launder their own clothes because the corporation can buy food wholesale and because the corporation will not pay its labor in cash.


The corporation pays its worker/owners in shares and shares are redeemable in goods and services provided by the corporation. Therefore, initially, the cost to the corporation for labor is the cost of providing food, cleaning, child care and laundry services to the kitchen, laundry, cleaning and child care workers.


The cash received from the operation, over the cost of food, supplies, rent and utilities will then be invested in the purchase of equipment and facilities that will allow the corporation to expand services.


The corporation would provide a place where a customer drops by on the way to work, eats an inexpensive, nutritious, good tasting breakfast; picks up a lunch pail of equal quality and posts a note on the bulletin board when his/her employer is hiring. After work, the customer can go home, shower, and go to the corporation's facility for an inexpensive, nutritious and good tasting supper. The customer might also drop off laundry for next day pick up.


The corporation will offer shares to workers to cook the meals, run the laundry, care for the children of fellow workers and thoroughly clean the facility every evening.


The first expansion for the corporation would be to provide two choices for each meal. One would be a daily special which will change from day to day, will be made in bulk and which will be offered as inexpensively as possible. The other would be a regular menu of items that can be prepared to order and that are priced in line with other "family" restaurants in the area. That will allow the corporation to expand its customer base.


The corporation would locate its facility in the area where people who may be described as "working poor" live. The corporation provides a source of food, laundry, child care and cleaning services that the worker would otherwise do without or pay for with cash. The corporation would solicit assistance from commercial restaurants, laundries, day care and cleaning companies to develop training programs for the corporation's workers that could lead to regular employment in those industries.


The second expansion for the corporation would be a program of purchasing residential properties in the area of the corporation's facility that can be rented to either customers or workers. The properties purchased would be rented, initially, to people working in the construction and landscaping businesses. Shares would be offered for specific upgrades to the properties. Upgrades would be accomplished by the renters with help from the corporation's workers interested in learning those trades. The corporation would solicit construction and landscape companies to develop training programs for the corporation's workers that could lead to regular employment in those industries.


The third expansion for the corporation would be to acquire access to land where food can be produced both for internal consumption and for sale through the restaurant. The corporation would concentrate on labor intensive, high value crops rather than staples that can be purchased cheaply in bulk.


The corporation would seek to arrange other services for its workers through share transactions or a combination of shares and cash. These might include preventive medical care and dental services. The corporation itself would seek to arrange accounting and legal services through share transactions. A professional entering such a transaction would be able to redeem their shares by having their lawn mowed, their house cleaned, meals delivered, etc.


The ultimate goal of the corporation is to make it possible for a worker to obtain all the necessities of life from working for the corporation. The only necessity not discussed above is clothing. There would probably also be some demand for modern conveniences such as home furnishings, electonics, music and videos. For these other items, I see four possibilities: 1)The worker takes part time or temporary jobs when necessary, 2)the corporation purchases these types of items wholesale and trades them to workers for shares, 3)the corporation offers a program of redeeming a certain number of shares for cash, or 4)the worker is able to sell shares for cash to others interested in purchasing goods or services from the corporation. Some combination of two or more of the above seems reasonable.


There is one final item of expense that I do not think can be reduced. That is the issue of insurance. At a minimum, the corporation will require workmen's compensation and premises liability insurance. The corporation would also want to provide group hospitalization coverage, at least for its regular workers. Government assistance may be available in some circumstances.


Processes and Goals


As the corporation acquires cash, it purchases assets that can be used to put more people to work. The more people working for the corporation, the more cash it can generate. The optimum size of the corporation, in any given market, is that point where anyone who needs additional income can find work at the corporation and no one is turned away for lack of work. (The corporation may have to turn away workers for other reasons such as drugs or abusive behavior). At that point, all employers in the market would have to offer wages at least equivalent to the value a worker can obtain working for the corporation and the corporation operates as a safety net that is not an expense of the larger economy." (http://www.aboutus.org/3DN_Self-help_Corporation)


More Information