Cooperative Capitalism

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Chris Cook explains the emergent phenomena of 'cooperative capitalism' based on an innovative use of the new UK-based legal partnership model.


URL = http://www.cooperativeintelligence.org/2004/07/cooperative_capitalism.html

Background

From the conclusion of the above essay, which distinguish closed and open corporate models and how the latter can be used to develop cooperative capitalism models:

Towards a Co-operative Society?

"It is possible to envisage a Society within which individuals are members of a portfolio of Enterprises constituted as LLP’s. Some will be charitable, or voluntary, to which individuals give their time, Money or other value freely. Others will be ‘social’ where individual citizens will invest in and subscribe to (say) health, education, transport and other utilities through functionally decentralised partnerships operating at the neighbourhood, community, area, regional or national levels. These will essentially be partnerships between co-operatives of service providers and cooperatives of service consumers ie the public. Finally, individuals will be Members of ‘Commercial’ enterprises of all kinds aimed at co-operatively working together to maximise value for the Members.

A pipe-dream? In fact, the process has already begun. The current form of competitive Capitalism was not planned: it is what is known as an ‘emergent’ phenomenon which continues to exist because it has demonstrated itself to be superior – despite its manifest and documented flaws – to all other models, such as Socialism.

It can only be replaced by another ‘emergent’ phenomenon, which is adopted ‘virally’ because any Enterprise which does not utilise it will be at a disadvantage to an Enterprise which does. By way of example of ‘emergent’ phenomena, we have seen how a 19 year old US programmer has single-handedly destroyed the entire business model of the global music industry through inventing on-line sharing of music in a network which grew to 60 million users within 18 months. In the same way, the small but powerful community of traders in physical oil moved their negotiations from the telephone into Yahoo instant messaging “chat rooms" without their management even being aware of the fact. They did so because it was free, because they could, and because it worked

The ‘Open’ Corporate Partnership is: capable of linking any individuals anywhere in respect of collective ownership of assets anywhere; extremely cheap and simple to operate; and because one LLP may be a Member of another it is organically flexible and ‘scaleable’. The phenomenon of ‘Temporary Equity’ – which is already visible in the form of significant commercial transactions - enables an extremely simple and continuous relationship between those who wish to participate indefinitely in an Enterprise and those who wish to participate for a defined period of time.

Moreover, the infinitely divisible proportionate shares which constitute ‘Open’ Capital allow stakeholder interests to grow flexibly and organically with the growth of the Enterprise. In legal terms, the LLP agreement is essentially consensual and ‘predistributive’: it is demonstrably superior to prescriptive complex contractual relationships negotiated adversarially and subject to subsequent re-distributive legal action. Above all, the ‘Open’ Corporate Partnership is a Co-operative phenomenon which is capable, the author believes, of unleashing the power for good which the founding fathers of the Co-operative movement strove for in the 19th Century, only to become bogged down in the 20th.

So perhaps in the Co-operative Corporate Partnership – the unintended consequence of a 21st Century UK legislative initiative arguably implemented for the wrong reasons in the wrong way - we now have the means to create a truly Cooperative Society." (http://www.cooperativeintelligence.org/2004/07/cooperative_capitalism.html)