“If you don’t like state socialism and you don’t like corporate capitalism, what is the answer to the theoretical problem of the next system?” This is the question, says US political economist Gar Alperovitz, “that’s driven me since the 1960s.”
I recently caught up with Gar to discuss this question, his support for alternative forms of community-worker ownership, and what it will take — politically — to make them a reality.
Gar’s thinking on these issues has proved influential in recent years, championed through the organisation he co-founded, the Democracy Collaborative, and trialled at a local level in cities from Cleveland, Ohio to Preston, Lancashire. Aspects of an alternative ownership model also entered the policy platforms of the Bernie Sanders’ campaign in the US and Corbyn’s Labour Party in the UK.
These mainstream electoral projects have now been defeated. But amidst the Covid-19 pandemic and looming climate crisis, the left urgently needs alternative economic models and new, more effective strategies for pursuing them.
With over 50 years of theorising and campaigning behind him—stretching from the War on Poverty and civil rights movement in the US through to collective Ujamaa villages in Tanzania and community take-overs of steel mills in the American Midwest—Gar has a wealth of insights to share.
The next system and of the politics of transition
Our conversation began with Gar outlining his understanding of a next system “design” and of “systemic transformation” or transition, which involve “two quite separate questions.”
On the design question, he emphasises the value of community ownership structures, which is a model that begins with geography. The value of these structures is in their inclusivity, incorporating everyone in a given place. “Only about 55 to 60 percent of those who live in a community are workers in the paid salary or wage sense,” meaning that focusing on workers alone leaves out women in non-waged care work, the young, the elderly, the disabled, the ill.
What form community structures should assume is “a question that Rosa Luxemburg posed”, Gar notes. “You find it in the Israeli Kibbutz movement, you find it in some theories of commune-ism rather than communism. Marx was interested in the question of the Russian mir, which was the original peasant formulation, which is a collective community structure. The Paris Commune [is another example].”
More recent, practical examples of community structures include, as Gar writes elsewhere, “cooperatives, neighbourhood corporations, land trusts, municipally owned energy and broadband systems, hybrid forms of community and worker ownership, and many more.” He adds in conversation that, to manage big companies and industries, you must also build up national and regional level public structures, but to ensure democratic accountability, there needs to be “a sub-structure that can control that”.
A community model does “have problems”; it can be “repressive”. It nevertheless remains, Gar argues, “one of the foundational elements” of a new, more democratic and egalitarian economic system.
Community ownership structures also contain within them part of the answer to Gar’s second question, how do we achieve the desired systemic transformation? Labour unions served as “the institutional base of social democracy as it was constructed in the 20th century”. Now, though, they are “literally disintegrating” along with the social democratic politics they previously upheld. “Labour union membership in the private sector in the US”, Gar notes, “is now a mere 6 percent of employed workers.” Amidst this decline in labour power, though, he argues that community structures might “become a power base for the next politics”, the next economic system.
Union organising and community ownership structures are not, of course, mutually exclusive. Indeed, some of the staunchest advocates of reviving the labour movement are adamant that radical, democratic unions must be rooted in the wider community beyond the workplace.
Gar nevertheless maintains that we cannot rely on unions alone nor can we overlook the often-neglected question of ownership. In the US, black, white and Hispanic communities “are all facing degradation”. We must build, right there in those communities, the local ownership structures that can serve as the “power bases for what becomes the next system”.
From theory to practice
Gar’s understanding of community ownership is rooted in practical experience, which offers its own insights into what can work and how.
His engagement began while serving as an aide to a liberal Senator in the late 1960s. It was at this time that he helped develop the Community Self-Determination Act, a piece of legislation that would have provided funding for locally controlled community development corporations in low-income urban and rural areas. The idea was that these corporations would invest in local business, local residents would buy shares, and credit would come from a network of community development banks.
The legislation, sponsored by the Congress of Racial Equality (CORE), attracted an unlikely coalition of backers. “I was working with a 17th century conservative Republican staff guy who believed in Vermont villages,” Gar recalls, adding, “He was attracted to a certain aspect of the community idea and was very sophisticated economically.” The two staffers, from opposite ends of the political spectrum, drafted the legislation and then “wrapped 34 Senators around it, half Democrats and half Republicans.”
One reason why the Act garnered this bi-partisan support was because, at that time, the idea of community ownership was “in the air.” The “pre-history” of the legislation went back to the community development corporation of the late 1950s, which was “interesting because it owned businesses and industry as a community structure.” “Experiments in community development” during that period gave rise to the “accidental innovations” that were then incorporated into the Johnson era War on Poverty.
Spurred in part by the Johnson administration’s promise of federal funding, in part by a new wave of activist organising, the community ownership model was, by the late 1960s, spreading across the United States. Examples ranged from the New Community Corporation in New Jersey to The East Los Angeles Community Union, which emerged out of the Chicano movement and received crucial early backing from the United Autoworkers Union.
Gar and his colleague, meanwhile, worked closely with CORE as well as with other black civil rights organisations. In that sense, the Act reflected the growing emphasis within the civil rights movement on community ownership. “I had just begun working with Martin Luther King Jr. and his staff to develop these concepts as a major piece of something he was beginning to explore for serious activity”, Gar notes. “It was really tragic because we were getting to a place where this could have been a part of his developmental project”, but “it was cut short by his assassination.”
MLK’s death was one of several damaging blows to a community ownership agenda. Another was the election of Richard Nixon, which was the beginning of a major reorientation in US politics. Among other casualties of the shifting tide, the Community Self-Determination Act was “taken over and destroyed”.
Gar moved on from the Senate in 1968, taking up a range of academic positions, first at Harvard and later at the University of Maryland. He did not, however, lose his practical focus. He soon set up the National Center for Economic and Security Alternatives, which was “a vehicle for experimenting primarily on community ownership.” It would later become the Democracy Collaborative, on which more later.
While developing his new organisation, Gar continued to cast around for real world examples of community ownership to draw on. This search led him beyond the US, including in the mid-1970s on a visit to Tanzania. “One of the reasons I went to Tanzania”, he explains, “was because of the Ujamaa idea, [then President] Nyerere’s conception of where he thought democratic or African socialism might go.” This interest also echoed what was then a more general appreciation on the American left for the politics of newly independent African states, particularly Tanzania.
Gar’s focus was nevertheless somewhat more specific. Leading up to his trip, he was exploring “variations on design”, and particularly how to scale from smaller cooperative structures to “larger structures,” which is how he became interested in Ujamaa and its apparently inclusive village structures. Nyerere’s theory of Ujamaa centred on the “geographic unit”, and “the notion was inherently everyone counts.”
Gar was, nevertheless, discouraged by what he saw in Tanzania. He accompanied a water engineer on a tour of villages, many of which appeared to be struggling economically, lacking in necessary technological equipment, and fundamentally, unsustainable. He left Tanzania thinking that Ujamaa in practice was “utopian in the not good sense of the term”, but even so, “the theory was still worth pursuing in different forms.”
Deindustrialisation and its alternatives
Back in the US, he was soon drawn into a new struggle, the fight against factory closures across the American Midwest, today’s Rust Belt. In 1977, he was called to Youngstown, Ohio, to advise on a joint community-worker ownership structure for recently shuttered and soon to close steel mills. “The workers and the community were working together”, Gar emphasises, “and oddly, the churches were involved too, giving them political cover.”
The closures in Youngstown was the start of a decades long collapse in the US steel industry. While steel executives complained of foreign competition, people in Youngstown countered that the main problem was deliberate disinvestment; rather than modernizing existing facilities, companies were investing outside the steel industry—notably in oil—to maximise shareholder profits.
The proposed take-over of the mills through a community-wide corporation — owned by thousands of community shareholders — was a way to both prioritize new investment while also securing the future of Youngstown. And, as Gar emphasises, this effort was about the Youngstown community in the widest sense. The city’s population included “the steel workers, in this case mostly men” but also of “their families, their wives, their children, their extended family and many others in the community”. All were mobilising so that “this community as a whole [could] flourish. It wasn’t just the workers and their fight for their salaries and conditions and pensions but also the schools and the churches and housing…”
This community focus also gave the Youngstown demand its “apple pie” quality. “It wasn’t dressed up in radical language,” Gar stresses, “It was a popular kind of idea.” “The group we were working with organised the state of Ohio so that even the Republican governor was forced to support the plan.” National television also “got very excited” about the idea, and the Carter administration pledged its support, financing a “sophisticated study of how to put together a steel mill” and promising $200 million in grants and loan guarantees. Part of the reason for this support was that “Carter needed that part of Ohio to win the  presidential election.”
Not for the first time, though, the vagaries of national politics ultimately undermined the community effort. The Carter administration was under pressure from steel companies and likely some higher-level union structures, at odds with their activist union members in Youngstown. The administration “in the end backed down”, which Gar argues, “was a mistake on their part politically” as they went on to lose Ohio and the election to Ronald Reagan.
Starting anew, from Cleveland to Preston
Sounding a more optimistic note, Gar observes, “The Youngstown experiment generated a whole rash of experimentation throughout the state of Ohio because it got so much attention. So, there’s a lot of worker ownership and community development in different parts of the state.”
Gar and the Democracy Collaborative also continued to design models of community ownership, searching around the United States for people to realise them with. A breakthrough came in the mid-2000s not far from Youngstown, in Cleveland, Ohio.
The proximity of the two cities was no coincidence. “Cleveland occurred and stands on the shoulders of what was built from Youngstown and the culture of Ohio,” Gar emphasises. He references, for instance, John Logue, a Professor at nearby Kent State University, who had worked since the 1980s on developing employee ownership strategies to avoid viable firms shutting down.
Gar narrates, “We happened upon a situation where there was a group of people, including the Cleveland Foundation—the oldest community foundation in the world—and the Cleveland Clinic—a very large health organisation—in the midst of a very poor black neighbourhood, who wanted to do something.”
Out of this confluence of people and interest came the “Cleveland model”. This model combines a community ownership structure with a new element, the strategic redirection of the procurement budgets of large local institutions, principally the Clinic, the municipal government and a local university and university hospital.
In 2008, with additional starter capital from the Cleveland Foundation, Cleveland’s Evergreen Cooperatives came into being. Using a community-worker ownership structure, Evergreen builds local business to create living-wage jobs in low-income neighbourhoods. The first business was a laundry, which served a local hospital, and the cooperative network has grown from there.
In 2011, the Cleveland Model travelled to the UK when Democracy Collaborative co-founder and the key Cleveland organiser, Ted Howard, visited Preston and captured the attention of left-leaning local councillor, Matthew Brown. From 2013, the Manchester-based Centre for Local Economic Strategies, a close collaborator with the Democracy Collaborative, partnered with the Preston City Council to start building what has become the “Preston model.” That, in turn, has inspired other local authorities across the UK to work with local “anchor” institutions, organisations with large procurement budgets, to support local investment, cooperative expansion, living wage employment, the creation of community banks and the like.
It is tempting to see an element of serendipity in Cleveland and perhaps in Preston too; “it was totally the right players at the right time at the right place.” But, Gar insists, what this apparent good fortune conceals is the “very serious intentional work” that lay behind it, the constant “looking for an opportunity… be it in Congress or Youngstown or elsewhere.” And the ideas generated in these places are spreading, the question being, how far will they go?
“You need to throw 30 years on the table”
Even as he emphasises the “promise” of Cleveland and Preston, Gar does not romanticize. He is especially quick to note that, while the two experiments offer important lessons, they also have their weaknesses. Two major problems, especially in Cleveland, are the “lack of political participation” and an “essentially top-down structure.”
To drive structural change, though, “You need to build a social movement that has content and ideas and vision”, the kind of movement present in the civil rights organising of the 1960s and in the Midwest industrial towns of the 1970s and 1980s.
There are no shortcuts, in Gar’s view, electoral or otherwise. The electoral question came back into focus recently with the Sanders campaign and Corbyn’s Labour Party, which put “alternative models of ownership” at the heart of its political agenda. Given previous electoral reversals, from Johnson to Nixon and Carter to Reagan, it seems crucial to retain representatives who are at least amenable to community ownership ideas.
But these representatives are “steppingstones,” Gar says. “I’m not opposed to that, but it’s much deeper… If you don’t also build from the bottom-up, you haven’t got anything.”
Reflecting on what opportunity the current crisis may offer, Gar notes that “it’s a learning experience,” adding, “Money comes out of spouts everywhere. The banks create the money, and you can just do it.”
But again, he cautions, “unless you have built the institutional base at the grassroots level and a political movement, they win. They will take over all these instrumentalities.”
At this point in the conversation, Gar begins, in his own words, “preaching”.
“I’m very interested in the question of how we, over time, rebuild the power base around institutions that include community structure. I think that’s possible. I think that was primitively there in Youngstown. It could be part of Cleveland. I think there are lots of prospects in the Hispanic community here. White working class as well; that’s what Youngstown was. The question is whether we can build a new politics with a new institutional base that begins with these community ownership structures…
"That’s a 30-year question. Don’t play this game if you’re not willing to throw 30 years on the table. Those are the chips. 30 years minimum. And that is really like the building of the labour unions originally to allow for the establishment of some kind of social democracy.”
This may seem like a very long odds game and thirty years like a long time, particularly given the urgency of the climate crisis. But as Gar comments, at least “in the ideas sphere, the old ideas are collapsing, so we’re beginning to have the advantage of offering a new vision.”
“Ideas don’t matter in history much,” he adds, “except sometimes.” It is a matter of continuing the “very serious intentional work”, building gradually from the bottom-up, looking for opportunities, and above all, “sticking with the 30-year hike.”