Reason.com

Free Minds & Free Markets

Can Laundry and Lettuce Save Cleveland?

A worker-owned co-op that even a capitalist could love is washing linens for the Cleveland Clinic and growing vegetables for the city.

About 40,000 pounds of laundry from hospitals and nursing homes—bed sheets, towels, surgical scrubs, bibs, and lab coats—arrive by truck daily at a massive building just east of Cleveland. Literal blood, sweat, and tears must be removed, and the items must be sent back, fresh and clean and folded, by the next day.

The interior of the laundry facility is about the size of a football field. Laundry is processed in 220-pound bags. The dirty clothes and linens spend 90 seconds in one washer, then 90 seconds in another; bleach and purifying chemicals are added in a third. Items go through two drying machines before they're pressed and folded, sealed in plastic, and shipped out.

This same process happens every night in every city in the world. Human fluids and other unmentionables that come with hospital life need to be dealt with so patients don't get sicker. The work doesn't pay a lot, and it definitely is not glamorous—but it's both necessary and necessarily local, given the fast turnaround that's needed.

Such facilities tend for obvious reasons to employ low-skilled individuals. Yet here, the economic arrangement differs from the norm. This laundry is being cleaned by Evergreen Cooperatives, a company owned in part by the people who work there. When stuff gets done more efficiently and profits go up, those with an ownership stake get bonuses at the end of the year.

Co-ops can get a bad rap, with a lot of people picturing the small money-losing food co-ops that exist mostly to subsidize brown rice for old hippies. But in its 10 years of existence, Evergreen has become one of the more successful, ambitious, and inspiring examples of the species—and rather than trying to upend the capitalist system, it is using economics as its operational foundation. The business has found a market it can thrive in, provides services at competitive prices, and then passes the profits along to employees who will spend their earnings in the local economy, hopefully creating a "fiscal multiplier." The idea is that average workers being able to afford groceries and cars and houses is a more important form of economic growth than a company's stock price going up.

Besides providing laundry services for Cleveland Clinic, one of the top health-care systems in the country, the co-op grows hydroponic lettuce and herbs in a 3.5-acre greenhouse. It also recently ventured into solar installations for existing buildings whose owners want to decrease their energy footprints.

Evergreen's annual revenues are now over $6 million. The laundry operations are profitable and the lettuce growing will most likely enter the black this year. Currently the co-op has 225 employees, about 45 of whom are worker-owners. (People must stay for about a year before they qualify for the ownership bonus.) Expansion plans are in the works.

America is at a crossroads in how to approach urban poverty issues and the wealth gap—especially in older Midwestern cities such as Cleveland. The left generally wants more welfare funding and public spending, while some on the right think the solution is to preach hard work and personal responsibility. Co-ops like Evergreen think they've found a third way: nonstate market institutions that chase profits while also giving a boost to people who could use a little help.

Workers here start at between $10 and $13 an hour. Many have been incarcerated, but at Evergreen, that is not held against them. About 20 employees so far have bought homes through a company-sponsored buying program that aims to get their purchase paid off in just five years, and the end-of-year bonus for those who qualify is likely to be more than $3,000 per person for 2018.

John McMicken, who has been the CEO of Evergreen Cooperatives since 2013, acknowledges that the dual mandate—economic sustainability and social service—can be a difficult balancing act. "Our mission has always been to benefit a lower-income inner-city workforce, and to do that with a co-op ownership to help fund that benefit," he says. "But we learned early on that if we were going to base any aspect of this business on federal or state assistance, we were in trouble.…In the end, in order to achieve our mission, we have to be profitable, because you can't share money with your workers unless you make money."

There is some irony that this is happening in Cleveland. In the late 1800s and early 1990s, the city was the boomtown of the industrial economy, a sort of Silicon Valley of a hundred years ago. This was where the steel was made and the oil processed into gasoline, where big metal machines stamped out little metal parts for everything manufacturers could think of. Cleveland-based Sherwin-Williams even made the paint to keep the cars from rusting. In 1910, it was the sixth largest city in the country. Cleveland Street, where the Gilded Age industrialists built their mansions, was known as "Millionaire's Row."

Cleveland was also the center of Progressive politics of the era—a movement that wanted to enact policies to balance the profitability of the industrial titans with the basic needs of their workers, many of whom lived in substandard tenements. John D. Rockefeller, who is thought to have been the richest person in modern history (at his peak, he was worth $400 billion in today's dollars), founded his Standard Oil conglomerate in Cleveland. He fought the government's antitrust allegations against him, which sought to break up his oil empire for "restraint of trade or commerce." (It did so in 1911.) He is also famous for saying, "Charity is injurious unless it helps the recipient to become independent of it."

Rockefeller is buried about four miles from Evergreen's laundry facility. In the neighborhoods around the cemetery where he lies, 47 percent of residents are below the poverty level, including 67 percent of children under 17. The average household income is about $18,000.

That is what Cleveland is dealing with. The city has just half the population it did in 1970. The overall poverty rate is twice the national average, household income is less than half of the national average, and home prices still haven't recovered from the Great Recession. Amid all this, Evergreen workers are grateful for a job, any job—and onlookers are starting to wonder if the key to a more equitable economic recovery might lie in how a hospital system's sheets and scrubs get cleaned.

The historic impetus for Evergreen's odd business structure has to do with Cleveland's wealthiest institutions and its most pervasive poverty being so close to each other.

"We have to be profitable, because you can't share money with your workers unless you make money."

The city's orchestra and museums, colleges such as Case Western Reserve University, the Cleveland Clinic, and several other hospitals are all located in a neighborhood five miles east of downtown called University Circle. Though the area is isolated a bit by geography and a lack of freeway access, it's right in the middle of Cleveland's East Side. Many of the city's highest-poverty neighborhoods, which are mostly black, can be found here.

Over time, the area's big health care and educational interests noticed a huge problem with the quality of life of those who lived nearby. One Case Western Reserve University study found that the infant mortality rate in the neighborhoods around University Circle was worse than in Sudan, Zimbabwe, and Bangladesh. "Within the three miles surrounding the University Circle area, infant mortality exceeds some Third World countries," said Michele Walsh, division chief of neonatology at Rainbow Babies & Children's Hospital in Cleveland, in a 2013 radio interview, "and that is an embarrassment and cannot be allowed to continue."

In 2005, University Hospitals Chief Administrative Officer Steve Standley put it succinctly: "Like a lot of major urban college hospital campuses, we're sitting in this one square mile of these beautiful institutions, and then there's this wall. And then you go into some of the poorest neighborhoods in Cleveland. Those are our constituencies and a lot of the stakeholders for our organization. And we were really struggling with a way to connect with them."

With a push from the Cleveland Foundation—a nonprofit founded in 1914 and a powerful force in the city—these moneyed "anchor institutions" tried to find ways to use their financial and social influence to "connect" with the poor areas around them. Part of this was good civic engagement, the rich caring about the poor and all that entails. But part of it was also the big institutions' own interests: Having unstable neighborhoods next door meant higher crime rates, made expansion more difficult, and rendered it almost impossible for their employees to find livable residential options close to work.

Ideas were thrown around on what to do to drive economic change in a positive direction. At first, they mostly relied on what Standley calls "the classic, old-fashioned diversity methodology and tactics." But eventually it was noticed that the "eds and meds" orgs in University Circle spent about $3 billion annually on goods and services. The Cleveland Foundation study group's thinking was that these big nonprofits could focus a percentage of those normal expenditures on nearby businesses, putting some of the money into the pockets of local workers and hopefully driving more economic activity in these high-poverty locales.

PeterHermesFurian/iStockPeterHermesFurian/iStockThe effort started in 2005 but took years to get straightened out. The Democracy Collaborative, a nonprofit associated with the University of Maryland, was brought in to oversee the development of a cooperative that could get some of that spending on goods and services. After seeing what co-ops had done in Europe—the prime example being the Mondragon Corporation in Spain, which was founded in the 1940s and now has 80,000 co-op workers in finance, manufacturing, and retail—it was determined that a worker-owned model would be the best way to go.

But their initial approach had a problem: It was overly political. Many people working for Evergreen believed the goal was primarily about pushing a liberal alternative to traditional corporate capitalism as opposed to helping Cleveland residents get steady jobs that would allow them to buy homes. "Evergreen seemed to be more concerned early on with ideology and less concerned with how to be competitive in the market," says a former Ohio elected official who asked not to be named.

So the first five years were a mixed bag. The city secured assistance from the federal Department of Housing and Urban Development and offered local tax breaks to help Evergreen acquire 11 acres (including 40 abandoned homes) on which to build greenhouses. The Cleveland Foundation and the anchor institutions also helped get the co-op more than $10 million in low-interest startup loans and grants. But when McMicken, who had run his own data organizing firm, was brought on to oversee things in 2013, he found some fundamental business rules weren't being followed.

"It was a tricky path to negotiate," he says, "We had large organizations who were going to spend on services from smaller companies like ours, and we sometimes got lost in the paperwork. And at the same time, they were part of the group that helped start the company and were active in the organization."

He realized that if a business was seen as a charity instead of a viable company that sold a product, it hurt the prospects for growth and made it more difficult to fulfill the goal of providing jobs for those who needed them. So McMicken decided to get back to basics. Lower costs by improving worker efficiencies. Go out and get clients who were not associated with the big anchors. Help the employees understand how the market rewards and punishes. "And we had to learn as a group that getting a CEO for a big company to buy a product or service from you, to get on to their page for consideration, well, everything moves slowly," he says. "But what you have to learn—and this has nothing to do with being a co-op—is that you keep having to pound on doors until you make the sale. That was a big learning curve for many."

Eventually the sales started coming in, which helped move the co-op to the next level. It now does laundry for a number of nursing homes and other health care systems besides the Cleveland Clinic and University Hospitals. Food maker Nestlé USA has contracted with Evergreen for basil grown in the co-op's hydronic greenhouses for making pesto sauce. An Ohio grocer with 60 stores in the state is buying a salad mix marketed by the co-op as "Cleveland Crisp." Local is on trend these days, especially in the food market, and Evergreen is capitalizing on it.

The latest Cleveland Clinic laundry deal was finalized in May, and new equipment installed before the end of the year should double the amount of laundry that can be processed daily. According to McMicken, that will likely lead to about 125 more hires, pushing the total number of Evergreen employees to more than 300.

"We aren't looking for any handouts, and I think what we do represents a whole new way of thinking," says Claudia Oates, a manager and one of the employee-owners at the laundry facility. "We have numbers and metrics we have to hit, and all of the employees know that if we hit those goals, we make more money. It gives people a sense of pride and stability."

Just defining what a co-op is has always been difficult, yet the idea has a history that goes back hundreds of years. Their popularity seems to rise after economic recessions, while they become less popular during times of prosperity. Hence, co-ops grew quite a bit during the 1890s and 1930s but declined slightly during the 1980s and 1990s. Tax laws that took away some deductions used by co-ops in the past have lessened their influence in recent years as well. And some say the traditional business community has never been a fan of the co-op way of thinking, accusing it of setting up hurdles so that cooperatives can never become more than a niche sector in the economy. That has created a de facto cap on the number of worker co-ops at about 300–400 in the U.S. at any given time.

Most co-ops these days are less urban than Evergreen—rural electricity cooperatives formed during the 1930s, for example, and agricultural collectives that sell the dairy products of multiple farmers together are still big players in the rural economy. But there are a few that, like Evergreen, sell seemingly unrelated services and products in a city environment. There's also Cooperative Health Care Associates. Based in the Bronx and staffed by 2,000 home health care workers who also have employee ownership, it does about $60 million in business each year.

Conservatives sometimes see co-ops as a hippy-dippy idea, while some progressives worry the co-op movement is merely an excuse to take the heat off capitalism's alleged failures.

A parade of representatives from different cities have come to see what Evergreen does, how it does it, and if something similar might work in Richmond or Milwaukee or Rochester or Denver. They're wondering whether what has now been named "the Cleveland Model" can be replicated. The answer seems to be "maybe, maybe not."

"One difference is that the institutions that decided to back this in Cleveland are very close together geographically and have shared interests because of that," says Ned Hill, a professor of economic development policy, public policy, and public finance at Ohio State University. "And having the backing of such a powerful philanthropic foundation opens doors for them."

Still, what Evergreen "has done in the past few years is impressive," Hill continues. "They are selling their products based on free market economics, with competitive pricing and good service. We all know that is not an easy formula to follow. It works because of hard work."

One question is how worker-owned businesses will be received politically. Conservatives sometimes see co-ops as a hippy-dippy idea that manages to go against both Main Street and Wall Street. At the same time, progressives could decide the co-op movement is merely an excuse to take the heat off capitalism's alleged failures and to reduce entitlement spending.

But Joseph Blasi, a professor at the School of Management and Labor Relations at Rutgers University, thinks the timing might be right for the Cleveland Model to take off. "It emphasizes the personal responsibility and ownership ideology of the Republican Party and the economic democracy and social justice ideas" of Democrats like Bernie Sanders and Alexandria Ocasio-Cortez, he observes.

In the end, it may be that co-ops can meld two partisan perspectives that are usually thought of as opposites.

"I think it is clear that what they are doing in Cleveland is taking capitalism and collectivism and pulling out and combining the best of parts of both," says Jessica Gordon-Nembhard, a professor of community justice and social economic development at John Jay College in New York. "Studies have shown that employee ownership increases productivity, results in better job satisfaction, decreases job turnover, and helps the company to be more profitable. Not every company would benefit from co-op ownership, but some will, and they could have a positive effect in many cities when done right."

How much of a difference co-ops can make on the ground is difficult to assess. A company with 300 employees largely earning less than $13 an hour will obviously never have the same impact as a behemoth like Amazon bringing 50,000 high-income jobs to a place. But it can move the needle of neighborhood stability in a positive direction.

Tim Tramble is director of a community development group near where Evergreen is growing its greens indoors. About half the residents of his Kinsman neighborhood live below the poverty line, and the average household income is just $16,500. But lately the area has seen some new home construction, and people are working hard at tearing down abandoned structures that have been empty for years.

"What people who come and do work in low-income areas don't realize is that the crime and social problems like drug abuse don't cause the poverty—the poverty causes them," Tramble says. "Having a job and a purpose and the nice things that come from those can stabilize a community much more than having police officers on every corner.…So increasing the number of people who work steadily and can buy homes in the community can have no negative effect. If the co-op model is a way to do that, then I don't know why we don't [pursue it]. Because I firmly believe that hard-working people living in a low-income neighborhood can have a greater effect on the community than the community will have on them."

Photo Credit: dja65/iStock

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  • AlmightyJB||

    "The idea is that average workers being able to afford groceries and cars and houses is a more important form of economic growth than a company's stock price going up."

    No it's not.

  • Rev. Arthur L. Kirkland||

    Still wondering why you lost the culture war?

  • Rockabilly||

    What's this 'culture war?'

    I'm not a deep thinker like the Rev. Arthur L. Kirkland, who have a huge brain and all the answers.

  • loveconstitution1789||

    I am glad Lefties lost the culture war.

  • 0x1000||

    I love how you're essentially a right-wing version of the Reverend, depth and all.

  • Eddy||

    "The left generally wants more welfare funding and public spending, while some on the right think the solution is to preach hard work and personal responsibility. Co-ops like Evergreen think they've found a third way: nonstate market institutions that chase profits while also giving a boost to people who could use a little help."

    Wait, this company's "third way" is an *alternative* to hard work and personal responsibility? I doubt they see it that way.

  • Sevo||

    "Wait, this company's "third way" is an *alternative* to hard work and personal responsibility? I doubt they see it that way."

    Kinda like Uber and Airbnb are the "sharing" economy rather than businesses arranged to make money.

  • Robert||

    I think what's meant is an alternative to preaching hard work & personal responsibility.

  • C. S. P. Schofield||

    "Wait, this company's "third way" is an *alternative* to hard work and personal responsibility? I doubt they see it that way."

    I had that reaction, too. This isn't a third way between Charity and Capitalism, this is making Capitalism the engine of (much more to the point) Charity. Rather than play Lady Bountiful, handing out money that will be gone in a month, this puts people who need the help on the ladder out of the hole.

  • BestUsedCarSales||

    This is a very "preaching to non-believers" type post, I think. Maybe share it with you non-libertarian friends.

    Because I agree that it is not really making any radical statements to those who already understand that non coercive interaction can take many forms.

  • Sevo||

    OT:
    I know my Superbowl experience will be diminished:

    "Amy Schumer supports Colin Kaepernick, will sit out Super Bowl ads"
    https://www.sfgate.com/sports/article/
    Amy-Schumer-supports-Colin-
    Kaepernick-will-sit-13323625.php

    But then, maybe no one asked her.

  • Eddy||

    What kind of Superbowl ad would involve Amy Schumer?

  • AlmightyJB||

    Lane Bryant and Jenny Craig?

  • loveconstitution1789||

    Its not about salad, that's for sure!

  • AlmightyJB||

    Rihanna turned down doing half-time show.

  • Don't look at me!||

    I have decided I won't make any appearances either. Even if they ask me to, I won't.

  • Sevo||

    Me, too!
    #Standwithfatso

  • Eddy||

    I, too, will refuse to be the spokesmodel for L'Oreal beauty products, no matter how much they flatter me and how much they offer me.

  • JWatts||

    "The left generally wants more welfare funding and public spending, while some on the right think the solution is to preach hard work and personal responsibility. Co-ops like Evergreen think they've found a third way"

    Woosh! This coop seems to be about hard work and personal responsibility. This isn't a third way. It's capitalism.

  • Robert||

    But not about preaching it.

  • Rev. Arthur L. Kirkland||

    Why would a libertarian care about conservative objections?

  • Rockabilly||

    Rev. Arthur L. Kirkland, how do you define, libertarian' and 'conservative?'

    I'm not a deep thinker like thou, or however you like your lessers to address his most holiness.

  • C. S. P. Schofield||

    The lesson here is one that the Left has ignored desperately for more than a hundred years; that communalism (as opposed to Communism) works, IF it is voluntary and focuses on working with the market economy rather then fighting it. The Left doesn't want this to be the case. It wants such enterprises to be dependent on the Political Class for handouts, because the Left's motivation is not charitable, but a corrupting drive to RULE.

    The bad reputation Cooperatives have stems from the idea that they should succeed more than other businesses. So when one fails, the reaction isn't 'well, businesses do that' but 'see, Cooperatives don't work'.

  • sarcasmic||

    The left doesn't support anything unless it is forced. They oppose communalism because it isn't forced. They would support the exact same thing if it was mandated by government. All they care about is force.

  • C. S. P. Schofield||

    While I completely understand what you feel that way, my experience is that that is only true for the Political Class Left, and to be strictly fair the Political Class Right has some of the same tendency. One does not become a member of the Political Class unless one wants to push people around. The principle merit of representative government is that it makes the process so inefficient that the population can usually frustrate the urge, if it annoys them enough.

    What ails the Left regarding Communalism is that they have a childlike attachment to 'should'. They think Communes SHOULD work, and so they tend to lose it when one doesn't. Cooperatives and Commnes are like any other enterprise; more of them will fail than will succeed, and very few will continue to succeed for any real length of time. SEARS is going tits-up, which I consider stunning, as they were fixture of the landscape when I was growing up. No Cooperative enterprise is likely to be longer lived than Sears.

  • sarcasmic||

    In my experience anyway, most leftists I've met won't do much of anything unless everyone else is forced to do it too.

  • Agammamon||

    This isn't even communism. Only a handful of those people get to make meaningful decisions for the company - that's even in the article. Its mainly just one dude - their CEO.

    They're certainly not all paid 'according to their needs' - I'm willing to bet their managers get paid more than '10-13 dollars an hour'. I bet their end of the year 'bonus' (actually share payout) is larger too.

  • C. S. P. Schofield||

    Only a handful (comparatively) of people make meaningful decisions in any Commune....or any manifestation of Communism to date.

    And no Communist government has EVER managed to give its subjects all they needed, without defining 'need' WAY down. While the Big Men, somehow, got lots more.

  • macsnafu||

    A co-op that focuses on business fundamentals and sustainable profit? Good for them?
    The real issue, though, is still the legal regulatory obstacles that make it harder to create and expand businesses. Licensing, minimum wage laws, excessive regulation, etc.

  • C. S. P. Schofield||

    Oh, my, yes. And the biggest flaw of the Left is that they believe otherwise.

  • Remember to keep it all polit||

    One annoying nit: the infant mortality stats are suspect. Many countries don't record births as "live" until several days after; if the infant dies before then, it is in the stillborn category rather than an infant death. The US tries to save more premature births than most countries, and those are the most likely to die. If you don't even try, they aren't infant deaths, just another stillborn.

    I don't know how much that affects these particular stats, but it would be more realistic to compare them against other US cities, not third world countries.

  • vek||

    I have heard most of that before, and it seems to be accurate.

    One thing I can think of though that might back up the case: People in third world countries are poor... They're not hopped up on crack climbing up the walls, or passed out for half the day on heroin or whatever. So it may be possible that more babies do die in the worst parts of the USA because even our poor can afford to be fucked up on drugs, popping out drug babies. Not to mention being too high to care about caring for them properly after they go home...

    Just a theory for IF their numbers aren't BS.

  • Vernon Depner||

    popping out drug babies

    You misspelled "pooping".

  • C. S. P. Schofield||

    Probably true, but the poor areas of Cleveland were pretty damn bad. I lived in the Cleveland Hights suburb until I was 18, and had mymfirst job in them city. Fortunately we got out just as Dennis (the Menace) Kucinich started his administration, which I gather was just as bad as one might expect.

  • Echospinner||

    Yeah. When driving from the Cleveland Clinic. Late at night.

    If you were going south on Carnegie Ave. into Cleveland Heights you were OK. Once it became Cedar Rd.

    The rules were that you never stopped for any reason going toward downtown. Go right through the stoplight. If a car hits you from behind GO. Your best bet.

  • vek||

    One thing that occurred to me awhile ago when all the stories about major European cities having "no go" zones popping up, was that America has basically ALWAYS (at least 100+ years at this point) had no go zones. There are entire portions of many major cities in the USA where you're a lunatic if you decide to drive through them, especially if you're a honky. I guess the Europeans just never quite had to deal with the concept of massive ethnic ghettos, and now that they do it freaks them out... As it should. It's not really an acceptable thing.

  • loveconstitution1789||

    That woudl also coincide with mitigating responsibility for hospitals since most American babies are likely born in hospitals. If the hospital cannot 'save' a baby and it dies, wording might be everything. Stillborn implies that the baby would never survive and the hospital is not at fault.

    Im guessing but lawyers get paid big bucks to invent shit like that.

  • Echospinner||

    A small word of advice

    Do not go into something as complicated as obstetrics and the medical legal implications unless you have something to say.

    Tell me more about corn farming. I am actually interested in that.

  • sharmota4zeb||

    This is a valid point. Many countries do not document the deaths of newborns as well as Americans do, according to what I've read.

  • drugwarisevil||

    Really? 90 seconds? Not 90 minutes?

  • Remember to keep it all polit||

    Saw that too, but those sound like quick pre-wash cycles just to get rid of the most obvious dirt that doesn't need soaking. Doesn't make sense that you'd spend two 90-minute cycles before adding bleach and detergent.

  • AlmightyJB||

    They wash the lettuce along with the Laundry in the prewash to save water.

  • Don't look at me!||

    Anything to boost profits.

  • vek||

    That caught me off guard too...

    I imagine they're throwing this stuff in some HEAVY DUTY ass machines that are agitating the shit out of stuff, probably in water that is boiling or near boiling. So 90 seconds may in fact be legit for industrial operations like this.

  • Vernon Depner||

    Yes. Large tunnel washers work fast.

  • Remember to keep it all polit||

    Never forget Reason saves Cleveland with Drew Carey. Some editor should have known the link. Oldie but goodie.

  • Remember to keep it all polit||

    Interesting read, but once again, it boils down to top-down central-planning does not work, that government disrupts everything, and that Progressives in particular and Statists in general are just thrashing around for ways to remain in power and don't give a rat's ass about actual people.

  • Fairbanks||

    I stopped reading when the "fiscal multiplier" was mentioned.

  • vek||

    Why? It's a real thing... If money is spent in a community, it usually gets spent around the community again, as opposed to somewhere else.

    If you have the choice of doing business with 2 companies who can offer identical pricing for a product, and one of them is in your city... Your city will have more economic activity going on if you send your business to the one in your city. Pretty obvious.

    NOW I think where you're objecting is probably that sending money outside the city can sometimes be "worth it" if the SAVINGS are worth it? Which is true. Division of labor, absolute/comparative advantage and all that jazz come into play.

    That said, if you're focused on community income, versus the income of any single party, sometimes spending even small amounts more to keep the cash in the community can also be beneficial FOR THAT COMMUNITY, if not the economy overall.

    It's, uhhh, basic math and stuff...

  • vek||

    Meh. Most co-ops are hippy crap. Not all of them though. The general idea isn't horrible.

    Honestly, I don't know why more companies that operate in a more "normal" way don't just co-opt a few of the good points, leaving aside the bad. Letting workers vote on company goals, pay structure, etc and the like is a HORRIBLE idea that some co-ops have. No need for that. However, giving stock grants/options as part of compensation packages for even low level employees would probably boost morale/productivity. Likewise with cash bonuses for hitting targets. There's not reason a normal company can't do this kind of stuff without going full on co-op in their mentality.

  • Sevo||

    "However, giving stock grants/options as part of compensation packages for even low level employees would probably boost morale/productivity."

    Agreed, but if, for instance, the company is stuck with a M/W ordinance, it might well not have the flexibility to do so while paying that M/W.
    Or, as Bezos did, you might raise the lowest wages for PR purposes and cut the bonuses so you keep the bottom line.

  • Longtobefree||

    If Bezos gave a damn, he would take $100,000/yr and split the rest of his outrageous salary with the workers on a fully equal basis.
    Sort of like if Bernie gave a damn, he would take a couple dozen homeless into his many homes; and share all of his earning (at least the part over $15.00/hr) with them.
    Right, Rev?

  • vek||

    True. minimum wage might be sucking up all the fluff room they may have otherwise. In my reading, I have come to the conclusion there is almost nowhere in the entire country that pays the actual federal minimum wage, including places that use the federal minimum. Market wages tend to be above this even in very low cost of living areas now. I'm sure there are SOME people in SOME really cheap places working for it, but not many.

    That said, when you're dealing with outright MW employees, a lot of them literally just won't care about stock options... They want cash. And when you're making that little, one can hardly blame them. But cash bonuses, perhaps quarterly... That would still be a perk most low wage workers would appreciate I think.

  • Fuck you, Shikha (Nunya)||

    Given where I am there was a huge clamor of folks that berated the company over such dispersals. They weren't upset that they didn't get anything. Rather, they were upset that the extra dollars went directly to a tax deferred retirement account that was immediately drawing another 7% per year. They only cared about cash. And they were vehement that they didn't care about the 30% they would immediately lose if such a request were granted.

    So SOME people might be happy with qualified stock grants, but my guess is that those at the bottom will largely be unmoved by any transactions.

  • AlmightyJB||

    Most large corporations do use performance based incentives.

  • vek||

    A lot do, but not all. And not to the extent that they might be able to in order to boost productivity and worker retention. Pretty sure Wal-mart employees don't have anything major in this department, yet it might make them give more fucks if they were. And so on.

    Also, these are ideas worthy of pretty much any size business too. Lots of medium sized businesses do this type of stuff, but probably a majority do not. It of course depends on the type of business too. Sometimes there's just not much point in dolling out cash if it's a pretty fixed amount of business being done no matter what employees do.

  • Old Mexican - Mostly Harmless||

    What people who come and do work in low-income areas don't realize is that the crime and social problems like drug abuse don't cause the poverty—the poverty causes them," Tramble says.


    Yes, those poor, poor crackhead celebrities...

  • vek||

    Yeah, it works both ways. Sometimes poverty/lack of opportunity will push people to crime/drugs, but MUCH of the time it's just fucked up people being fucked up people. There's no lack of work for people in Seattle right now, yet we have hordes of drugged out zombies invading the city right now.

    People who don't realize that some people are just lost causes are delusional...

  • Robert||

    "What people who come and do work in low-income areas don't realize is that the crime and social problems like drug abuse don't cause the poverty—the poverty causes them,"

    I'm not convinced the causality flows in only 1 direction.

  • AlmightyJB||

    As with many downward spirals, it's no doubt a vicious cycle.

  • AlmightyJB||

    So what you're saying is that we need to embrace National Socialism.

  • Remember to keep it all polit||

    Local Socialism, please. Lozis, if you will.

  • Agammamon||

    Workers here start at between $10 and $13 an hour.

    You don't mention the buy-in price. Or how profits are distributed. Does the guy who cleans the bathrooms get the same $3k bonus as the guys out hustiling for new business?

    Co-ops can get a bad rap

    Are these actually co-ops? The workers don't seem to own them.

    Co-ops like Evergreen think they've found a third way: nonstate market institutions that chase profits while also giving a boost to people who could use a little help.

    OK, this is weird. They haven't found a third way. This is a privately-owned company. Its sole distinction is that its owned by more than one person - and so are tons of small businesses and pretty much all large ones - and its worker owned - a couple lawyers or doctors working together? Ring a bell?

    And what is a 'non-state market institution'? Is this like the 'sharing economy' - someone coming up with a new word to describe something that people have been doing for thousands of years (like, you know, *renting*) because they either think the old word is icky or they're so clueless they think its something new?

    "I think it is clear that what they are doing in Cleveland is taking capitalism and collectivism and pulling out and combining the best of parts of both," says Jessica Gordon-Nembhard,

    Jesus, you're getting quotes from complete idiots who don't know what capitalism is.

  • Agammamon||

    "Studies have shown that employee ownership increases productivity, results in better job satisfaction, decreases job turnover, and helps the company to be more profitable. Not every company would benefit from co-op ownership, but some will,

    OH COME ONE! She is, literally, right here saying that 'studies show - except for those studies that don't show'. And she doesn't even realize it.

  • sharmota4zeb||

    Agammanon, it is called variance. Do I have to teach you everything? I'm not getting paid to explain things to Americans one by one, because I was too stubborn to be a zonah in my younger days. (See the comment below for more information.)

  • Agammamon||

    Yeah. And it shows, contra to her statement, that employee ownership is not a blanket panacea for what ails business.

    Some businesses it works well in - this we already know and those businesses are normally organized that way - and other it doesn't - that vast majority - and so they aren't.

  • Echospinner||

    Yup. It is a group partnership not a radical idea. Like most large group partnerships there is a CEO and likely a board that makes all of the decisions.

    Pitching themselves as a community organization is a good sales point.

    Smart to locate in an area where the city is basically giving away property. There is also a good supply of people who will work for $10 an hour where they would otherwise have to bus or commute to the suburbs to find work.

  • IceTrey||

    "I'm from the government and your waste water is polluting the Cuyahoga River, I'm shutting you down."

  • Echospinner||

    I have to admit that the only thing that could save cleveland would be to get LeBron back and bring in Durant and Westbrook.

    I remember reading about the greenhouse a few years back. They were not doing so well. The idea was to sell to local restaurants. Now they found a chef with experience doing this and with the Nestle arrangement they should make a nice profit.

    The solar panel project, in Cleveland? Now all they need is some sun.

  • sharmota4zeb||

    Over time, the area's big health care and educational interests noticed a huge problem with the quality of life of those who lived nearby. One Case Western Reserve University study found that the infant mortality rate in the neighborhoods around University Circle was worse than in Sudan, Zimbabwe, and Bangladesh. "Within the three miles surrounding the University Circle area, infant mortality exceeds some Third World countries," said Michele Walsh, division chief of neonatology at Rainbow Babies & Children's Hospital in Cleveland, in a 2013 radio interview, "and that is an embarrassment and cannot be allowed to continue."

    I hate to say this, but this might be the fact that gets progs to start improving life for inner city residents. If word gets out that immigrating to America's inner cities is a downgrade, they won't be able to find people willing to carry their sandwiches from the kitchen of their sit-down restaurant to the table of their sit-down restaurant.

  • sharmota4zeb||

    There is some irony that this is happening in Cleveland. In the late 1800s and early 1990s, the city was the boomtown of the industrial economy, a sort of Silicon Valley of a hundred years ago. This was where the steel was made and the oil processed into gasoline, where big metal machines stamped out little metal parts for everything manufacturers could think of. Cleveland-based Sherwin-Williams even made the paint to keep the cars from rusting. In 1910, it was the sixth largest city in the country. Cleveland Street, where the Gilded Age industrialists built their mansions, was known as "Millionaire's Row."

    Now I can better understand a sentence I read in a history book back in graduate school. The book said that the stock market crashed when London investors started asking if Cleveland or Ohio was larger.

  • BigT||

    There is no Cleveland Street, it is Euclid Avenue.

    Poorly researched articles are not convincing.

  • Echospinner||

    Yup and the main arteries coming in or out of the Clinic are Euclid, Chester, or Carnegie.

    The clinic has bought up every surrounding property it can.

  • sharmota4zeb||

    About 40,000 pounds of laundry from hospitals and nursing homes—bed sheets, towels, surgical scrubs, bibs, and lab coats—arrive by truck daily at a massive building just east of Cleveland. Literal blood, sweat, and tears must be removed, and the items must be sent back, fresh and clean and folded, by the next day.

    Fun fact, a zonah is a woman who gets paid to do the difficult work that a wife traditionally did for free, such as nursing the sick. Mary of Magdalene poured the oil on Jesus's head to cure him of the lice and whatnot that one picks up when one makes a point of hanging out with homeless people. The next time a clergyman says that Mary of Magdalene was a prostitute, look him in the eye and ask, "What does 'zonah' mean, and how is your wife feeling today?"

  • Echospinner||

    Zonah is the Hebrew word for prostitute.

    In biblical reference it may also refer to a female innkeeper or woman paid for tasks who is not a wife.

    Mary (Miriam) the magdoline reference is to a fishing town on the shore of lake kinneret.

    They still fish there but when you get that nice whole fish cooked up in Tiberius is is farm raised tilapia from the kibbutz nearby.

    That is all I know so I leave it to Christian scholars to figure out.