Building an Alternative to Amazon?

_{Photo Credit: Orbon Alija via Shutterstock}

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During a community town hall discussion last year, Congresswoman Alexandria Ocasio-Cortez commented that “If Jeff Bezos wants to be a good person, he’d turn Amazon  into a worker cooperative.” AOC’s refreshing call for a radical transformation of Amazon’s Everything Store rests on a well-established case of shocking violations of workers’ rights throughout its planetary-scale supply chain, an ecological footprint greater than most countries, record-shattering tax abuse, practices perpetuating racial injustice, the woes of countless small companies, and, most recently, unparalleled pandemic profiteering. Amazon just posted record first-quarter earnings, tripling what it had made a year ago but still, it insists that it cannot afford paid sick leave for its warehouse workers.

Unsurprisingly, the e-commerce giant has attracted the ire of many movements and politicians. Jeff Bezos’ corporation has provoked considerable labor action among its 1.3 million workers worldwide, a steady stream of lawsuits, antitrust policy proposals, and calls for nationalization. Ocasio-Cortez’ evocative suggestion to convert Amazon into a worker co-op, however, stands without parallel.  

As a point of departure, we share AOC’s belief in the cooperative model as a promising, imaginative strategy to shift an economic system marked by inequality and exploitation towards collective prosperity and economic democracy. But we don’t think that the conversion of this de facto monopoly into a single worker co-op would be a one-stop solution. Instead, we propose a diverse, transnational pluralist ecosystem; a synergistic global alternative to the Everything Store built and driven by suppliers and workers. 

The rise of the power of large tech companies has invited comparisons to the unfettered capitalist era of the late nineteenth and early twentieth centuries when a small number of business titans ruled over ever-expanding monopolies. Widely reviled as “robber barons,” magnates like Andrew Carnegie (Carnegie Steel Company) and John D. Rockefeller (Standard Oil) amassed vast fortunes. In the United States, mounting popular resistance against this injustice led to pioneering antitrust regulation that sought to end the robber barons’ domination by breaking up their private empires into a large number of smaller companies. Throughout the twentieth century, socialists from the United Kingdom to Cuba sought to dismantle similar structures of domination and control through nationalization

Drawing on these legacies, antitrust and nationalization are frequently touted as promising strategies to halt Amazon’s power grab. The antitrust agenda, in particular, is picking up steam. Columbia professor Lina Khan, who rose to prominence with an influential paper on Amazon’s monopoly power and ways to tackle it, is poised to take up a position in the Biden-Harris administration. In Argentina, the national postal service launched the state-owned online marketplace Correo Compras, which could become a template for the nationalization of Amazon. 

Their historical merits and future potential notwithstanding, however, both antitrust and nationalization have significant limitations. Breaking up Amazon will, as such, will do nothing to alter the exploitative business model underpinning the corporation’s various branches. Nationalization would cut Amazon’s global logistics network into disparate pieces that would eventually regain dominance. Beyond doubts about the likelihood of nationalization, it would also run the danger of replacing Amazon’s private stranglehold over local economies with U.S. government-led data colonialism.

Beyond Antitrust and Nationalization
In light of these limitations, cooperativism offers an appealing alternative strategy to challenge Amazon’s dominance. Cooperative schemes formed the backbone of early socialism as developed by thinkers like Henri de Saint-Simon, Charles Fourier, Robert Owen in the first decades of the early nineteenth century. Prescribing communal formulas that sometimes bordered on the bizarre, their designs sought to counter the individualist logic of emergent capitalism by returning control over both the labor process and its products to workers—a far more transformative vision than that of the antitrust agenda. In sharp contrast to the limited geographic focus of later socialist advocates of nationalization, Robert Owen envisioned that cooperatives would “increase in number [and] unions of them, federatively united, shall be formed […] until they shall extend all over Europe, and afterward to all other parts of the world, uniting all in one great republic, with one interest.”    

To this day, the cooperative model retains its advantages over antitrust and nationalization strategies. Worldwide, cooperatives embrace a shared set of principles first formulated by followers of Owen in 1844, including democratic control, autonomy, member participation, concern for community, and cooperation between cooperatives.

Based on what we wrote about co-ops here, would it not be desirable to replace monopolies like Amazon with cooperative monopolies everywhere? As the Labor Annals already suggested in 1898, it would certainly be better “for people to own the monopolies than for the monopolies to own the people.” There are certainly examples that suggest that this is possible. The Danish cooperative society ‘Leverandørselskabet Danish Crown AmbA’ is the world’s largest exporter of pork. The Indian agricultural cooperative of Amul Dairy, made up of millions of individual farmers, is one of the world’s largest producers of milk and milk products. In Finland, two dairy cooperatives own the largest shares in the country’s leading milk business Valio. In Japan, the consumer co-op called Co-op occupies more than 50% of the food delivery service market.

But other large cooperatives, such as the Canadian Mountain Equipment Co-op, have demutualized or faltered in recent years. And beyond such trends, the academic literature provides evidence suggesting that monopolistic cooperatives, at least in a capitalist economy, do not reliably act better than their corporate cousins. Once scaled, the cooperative character of these large businesses is often no longer felt by many of their members.

Mondragon as a Template for the Conversion of Large Tech Companies?
The case of the Mondragon network is often used as evidence that the worker co-op model is viable and competitive at the planetary level. Founded in 1956, Mondragon is a federation of cooperatives that employs 30,000 worker-owners—roughly half of whom are women. The 96 cooperatives and 141 subsidiaries in the federation include machine tool manufacturers that produce electromagnetic equipment, garden furniture, consoles, and gears for the world’s top carmakers, and much else. Workers and managers invest in Mondragon and have one vote in its general assembly. Each of Mondragon’s co-ops is represented at the Cooperative Congress where network-wide decisions and plans are adopted. The pay differential between the highest and lowest paid workers at Mondragon is 6:1, with the CEO of the entire Mondragon Corporation earning nine times as much as the lowest-paid worker. To put this into perspective, the average pay differential in large U.S. American corporations is 600:1. In his book 2312, the American sci-fi writer Kim Stanley Robinson referred to Mondragon as a paradigm of a new socio-economic model of collaboration and solidarity, a “living example of an alternative to standard capitalism.”

But is Mondragon the example of a global worker cooperative that so many people make it out to be? A closer look reveals that Mondragon is in fact a federation of consumer and worker co-ops. The network also includes a foundation that is jointly operated with the Basque government. Its foreign subsidiaries, primarily located in developing and post-socialist countries, are not cooperatives. The over 50,000 workers in these companies are often temporary workers on short-term contracts who are still paid up to 20 percent more than the average market rate in a given country. Critiques of Mondragon have shown these limitations. Mondragon impressively secures decent work conditions at home in the Basque Country but so far, it is not yet a practical template for the conversion of Apple (or other big technology companies) into worker co-ops.

And this is not merely about Mondragon. Converting Apple (or Amazon) into a single cooperative will inevitably bring about the positive results associated with cooperativism. Amazon’s commercial empire is vast and diverse; its worldwide labor force includes not only 1.3 million directly employed warehouse workers, software engineers, delivery drivers, office clerks, and lower-tier managers, but also vast groups of subcontracted workers in paper mills, garment plants, and electronics factories, predominantly in the Global South. Integrating such a great diversity of stakeholder groups into a single, monolithic cooperative body would quickly open the newly established worker co-op up to the risks of a move away from co-op principles outlined above. Trust, a crucial ingredient for cooperatives, for instance, would be hard to realize. Without typical cooperatives’ embeddedness in local communities, the vertically integrated global cooperative would likely be geared towards meeting firm-level competitive exigencies rather than benefiting society.  

A Network Rather Than a Bulwark: Toward a Planetary-Scale, Pluralist Commonwealth for the Digital Economy
In our view, therefore, an alternative to the Everything Store should be a network rather than a bulwark, building on the history of the cooperative commonwealth, an economy made up of connected but autonomous enterprises.

• A commonwealth of cooperatives all along the supply chain using shared digital infrastructure
  We envision an economy with, at its core, a commonwealth of cooperatives gone digital. Here, federated, small producers can act as one large entity, competing in the marketplace through shared digital infrastructure. Digital cooperative ownership builds on the promise of scaling operations and governance through shared digital infrastructure, potentially leading to lower operating costs than brick-and-mortar cooperatives. It is a vision of multi-stakeholder cooperatives that enfranchises all participants in the economic value chain (and other forms). This includes logistics workers, managers, tech workers, upstream supply chain workers, suppliers, and customers. 

• A bricolage of organizations
  Ours is a vision of a bricolage of organizations, a plurality of independent worker-and-user managed and owned enterprises up and down the supply chain, democratic employee-owned businesses (“esoperatives”), not-for-profits, unionized private companies, and hybrids among these. It is a vision that does not prioritize one model over the other as different sectors demand different structures and sizes. Let’s stop the circular firing squads among progressives who fetishize one organizational form over the other.
  
  
• Feminist economics
  Our proposal builds on Feminist Economics; aiming to address structural economic gender disparities, feminist economics not only examines gender roles within different co-ops and other organizational forms, but it also works toward radically re-imagining co-op culture, rendering women more visible and valuing practices of care within these organizations.
  
  
• Equal access to just platform work
  Platform companies depend on minoritized, low-wage workers. Our vision is based on a culture that provides equal access to just platform work for all.
  
  
• Design justice as part of a pluralist commonwealth
  Avoiding the tech-solutionism of Silicon Valley, our proposal builds on the commonalities between platform cooperativism and elements from Gar Alperovitz’ concept of a “pluralist commonwealth,” first proposed in 1972, and Sasha Constanza Schock’s Design Justice.
  
  
• Co-producing commons
  The proposed digital pluralist commonwealth will be rooted in shared-data agreements, cooperative data trusts, distributed ledgers, community-stewarded AI, and token systems that facilitate time banks, participatory budgeting, and distributed decision-making. Platforms for data sharing among cooperatives, based on a variety of cooperative reciprocity licenses, will turn the promise of big data into a cooperative advantage, while actively co-producing commons. The purpose of deploying such technologies is to emancipate users, workers, and the entire population. To succeed, it will require strengthening the way that cooperatives work together.
  
  
• Breaking capital’s spatial agenda
  Applicable throughout planetary-scale production networks, this proposal is a response to capital’s spatial agenda, which is based on low-cost production in the Global South for consumption in the Global North. While a globally structured network of cooperatives will break with such a north-south dynamic by enforcing fair wages, meaningful positive outcomes for the global poor will require a broader political vision.

_{Image Credit: Walter Crane on Flickr}

Our proposal builds on a rich history and cooperative commonwealths on the local, national, and transnational level. Already in the late nineteenth-century United States, the labor federation Knights of Labor (KOL) envisioned widespread adoption of economic democracy by developing what they termed a “cooperative commonwealth.” As one scholar relates, their vision grew into a network of at least five hundred cooperative workshops and factories in the quarter-century following the Civil War. Products made in the network all carried the KOL label. Like Amazon’s empire today, the network included a wide array of workplaces, ranging from industrial mines and mills to artisan printers and potters. With slavery only recently abolished, African American Knights of Labor members launched cooperatives for cotton and gin. They also built cooperative villages in different parts of Alabama. In the late 1880s, the Knights developed ties with the Farmers’ Alliance—a new, extensive network of agricultural cooperatives with three million members.

Today, modest examples of cooperative commonwealths exist on a planetary scale. At the transnational level, Cooperative Coffees links cooperative fair trade roasters and retailers in the United States and Canada to nineteen farmer co-ops in countries across Latin America, Asia, and Africa. In Finland, Italy, and India, national and regional cooperative commonwealths integrate worker and union co-ops in various sectors into mutually supportive networks. Within the Basque heartland, Mondragon is of course also an example of such ecosystem approach. In Mississippi, the Jackson Cooperative includes various enterprises and a sustainable housing project designed to fight the twin legacies of poverty and racial injustice.  In Cleveland, Ohio, Evergreen Cooperatives includes various enterprises ranging from eco-friendly laundry to urban farming, all co-owned by over 200 workers, many from disadvantaged backgrounds. Inspired by the Cleveland example, the city of Preston in the UK launched a group of 10 worker cooperatives. 

Solo initiatives like the platform co-op Fairmondo that aimed to compete with Amazon or eBay did not manage to—even for a moment—become an itch that Amazon could not scratch. There are numerous reasons for this: from insufficient funding to governance, platform co-ops experience many growing pains. The Amazon Everything Store is a global commercial empire linking almost 10 million individual sellers to hundreds of millions of customers, of whom over 200 million (!) are paying Amazon Prime members. Asking a single platform co-op to outcompete with such a meso-level corporation is like asking a 5-year-old child to go on an 11-hour hike with a 60-pound backpack. Demands for cooperatives and platform co-ops to scale to a size that will rival Amazon also follow the logic of venture capital. Platform cooperatives like Stocksy United, Eva, and Savvy that(inevitably) compete with large market players typically take secondary or tertiary roles in their respective markets. Cooperative alternatives that are shaped as ecosystems, by contrast, are more likely to succeed. They look beyond what a single cooperative does for its members.

In the US, Bookshop.org is an online marketplace for books. While not a cooperative, as a benefit corporation it is dedicated to the public good. All books are purchased from local independent bookstores and then packaged and shipped by Bookshop.org. Contrary to Amazon.com, which started out in the late 1990s selling mostly books, Bookshop.org’s goal is not to skim the profits of publishers and bookstores, but rather ensure and increase their commercial success in the digital era. Just as Amazon gradually expanded from books to other product markets, Bookshop.org and similar initiatives could gradually become a serious competitor to Amazon in a variety of sectors. 

A promising example that stays closer to cooperative ideals is La Zona. Situated in Catalonia, La Zona is an ethical, sustainable alternative to Amazon scheduled to be launched by the summer of 2021. The project is run by a consortium of Catalonian cooperative businesses led by the Opcions co-op and partly funded by the autonomous government of Catalonia and the city government of Barcelona. La Zona will bring together several thousands of cooperative businesses, all of which will be plugged into the shared system of order processing and delivery on which the project hinges. Delivery will be carried out by transport company Koiki, which across 17 Spanish provinces operates 50 distribution hubs, from where parcels are delivered by foot, bicycle or scooter to reduce CO2 emissions. Delivery workers receive a fixed wage rather than payment per parcel that has become common in the industry. Enterprises who wish to participate in La Zona must adhere to the project’s standards regarding sustainability, good working conditions, as well as democratic financial management, and respect for gender equality.

Scaling Wide and Deep 
In our view, La Zona’s approach, if scaled wide and deep, is the most promising way toward a digital cooperative commonwealth that in due course could rival Amazon. But it will only be able to succeed with government support. Billions worth of public subsidies, which have played a key role in facilitating Amazon’s rise, should be urgently redirected away from Amazon and towards the development of the social economy. Existing examples of alternative investments, from publicly-owned digital marketplaces to French and British programs stimulating conventional enterprises’ conversion to the cooperative model can lead the way.

As the neoliberal consensus appears to be on the verge of disintegrating, the historical moment seems ripe for this kind of transformative public investment. All across the globe, a shift toward popular and political support for more government intervention in the direction of economic development is visible – and increasingly palpable. Aided by the immediate urgency of the global COVID-crisis, ambitious programs to restructure the economy towards sustainability and, to a lesser extent, equality are being developed and implemented that until recently seemed unfathomable.

While cooperatives, as we see them today, do not systemically transform capitalism’s DNA, some forms of cooperatives are essential in the toolbox of political parties that could bring about system change. Together with unions, they can attract masses of people to join simply because they provide tangible benefits right now. They push for decent pay and dignified working conditions as well as lower prices and better quality of goods and services.

The vision of a planetary-scale, pluralist, digital commonwealth laid out in this essay is neither a silver bullet nor a quick fix. Joining idealism and pragmatism, our proposal promotes worker power and workplace democracy across the supply chain—using public investment to dismantle capital’s control over labor locally without sacrificing the global ubiquity at the root of Amazon’s success. We realize that building such a comonwealth will be a long and arduous process, and its results will not exist outside of capitalism. Yet, even small steps along this process will bring meaningful change to communities around the world currently facing the exploitation and destruction wrought by Amazon’s Everything Store. 

Our proposal promotes worker power and workplace democracy across the supply chain—using public investment to dismantle capital’s control over labor locally without sacrificing the global ubiquity at the root of Amazon’s success. Yet, even small steps along this process will bring meaningful change to communities around the world currently facing the exploitation and destruction wrought by Amazon’s Everything Store. This transformation, we believe, begins with imagination. It ends, we hope, with the delivery of products that benefit not a distant shareholder or investment management firm, but the hard-working people who made it, wrapped it, and brought it to your doorstep.