Mastodawn

Some ESOPs are also majority worker-owned and some of those are democratic.

Particular #taxes that can be implemented in private democratic federations of worker #cooperatives are

- Harberger taxes
- Transfer taxes
- the most important tax is a exit tax to prevent people from taking capital accumulated in one community and using it to fuel the #capitalist sector.

See: E. Glen Weyl’s work

#coops #TaxPolicy

I belong to two co-ops. They are customer based co-ops.

I have had some association with other co-ops, but they too were customer based.

I have heard of worker-based co-ops, but I don't have any first-hand experience with any. I have not heard of any in southern Alberta. I suspect this business model is not that viable.

https://www.nceo.org/research/employee-ownership-100-largest-employee-owned-companies

@davevolek

Consumer co-ops involve the same violation of workers’ property rights and inalienable rights as traditional corporations.

In the US, majority employee-owned companies are more popular than worker co-ops. Theoretically, there’s no fundamental economic reason why they shouldn’t be viable. Their rarity is better explained by inherent collective action problems in a system where voting rights in firms are alienable.

I plan to start my own worker co-op.

The Employee Ownership 100: America's Largest Employee-Owned Companies

A list of the 100 largest U.S. companies that are employee-owned through an employee stock ownership plan (ESOP) or other means, ranked by the number of employees.

Having been in business and around many businesses, I recognize the challenges of staying in business, let alone earn a profit in that business. Successful businesses need to have a "killer instinct."

I am hoping the spolu helps workers find their killer instinct AND consumers prefer to shop there. Not one or the other, but both have a stake.

@davevolek

I just don’t see another path for my generation other than changing the system, so we have to try something different.

My hope with the structure I’ve been thinking about is consumer membership at the level of the federation can help with consumers wanting to shop at these companies. Additionally, the consumer federation benefits will be paid out in the federation’s currency, so exit taxes will incentivize more transactions and commitment to the federation and exercising voice.

I buy all my gasoline and about half my groceries at South Country Co-op. I believe the gasoline prices are competitive. But it's not hard to see that prices at the Co-op are 10% to 15% more than my Walmart.

But if more people shopped at the Co-op, it could afford to lower prices. We need more civic empathy for where we shop.

@davevolek The exit fee helps with this by making it so that those that accumulate within the federation are obligated to the federation at an incentive level. This allows some degree of mutual aid in the form of below market rates among federation members because they can be assured that counterparties to internal transactions are committed to the same federation. Customers might receive their slice of the federation membership benefits in the internal currency.

Democranomic Oct 11, 2025

I had not heard of Glen Weyl or "quadratic voting" before. It seems like a very useful social technology.

Gemini's summary was helpful in understanding it as, quote:

- a novel voting system designed to better reflect the intensity of voters' preferences rather than just their direction of choice.

- Voters are given a fixed budget of "vote credits". ... To cast N votes on an issue, it costs N^2 credits. For example, 1 vote costs 1 credit, 2 votes cost 4 credits, 3 votes cost 9 credits, and so on.

- mitigate the "tyranny of the majority" that can occur in "one-person-one-vote" systems. In traditional majority rule, a large group that only slightly prefers an outcome can overrule a smaller group that cares intensely about the opposite outcome. QV addresses this by allowing the intense minority to buy more votes and increase their influence on the issues that matter most to them.

So each person is given the same number of credits. A person can express the intensity of their preference by putting more votes on a single issue, but each additional vote on that single issue costs more credits. Meaning they have less vote credits to spend placing votes on other issues. Or they can put just a few votes on many issues. They can choose their balance of intensity vs. breadth.

Seems like some gaming could happen by whoever gets to choose the group of votable issues given to voters (i.e. putting many issues known to be important to the minority to force them to dilute their ability to register their intensity on any one issue). But still seems like a net positive compared to majority rule.

Thanks for sharing this.

https://assets.press.princeton.edu/chapters/s11222.pdf

J Lou Oct 11, 2025

@cobber2005

Quadratic voting is definitely an interesting idea, but I had in mind more so his other ideas. For example, the first chapter of a book he co-wrote called Radical Markets, which can be found here:

https://tiereddemocraticgovernance.org/blog_details.php?blog_cat_id=19&id=387

You might be interested in my advanced co-operative, where profits are distributed between investors, employees, customers, suppliers, and philanthropy.

Each spolus would consider it an honor to pay taxes, for that means it can distribute profits to stakeholders.

In this document is also an obligation for each spolu to invest in other spolus.

With spolus paying fair business taxes, we won't need a complex tax code.

@davevolek I saw that part in the article. I was interested by it. In the model I advocate, profits go to workers. Investors should hold non-voting preferred shares. Allowing some control rights for investors and consumers should happen at the level of federations of worker co-ops. I’ll read more about your model when I get the chance and see where your thinking and mine differ.

My thoughts on corporate income taxes are mixed. The sentiments that usually motivate them are good though.

Sounds good. The spolu document is available on my TDG blog and my Inventions website---for a free read.

It will be easier for spolus to start or expand, as compared to regular co-ops. Finding capital is a big problem for the co-op movement.

It is a work in progress. It needs editing and a few more concepts to be put in. Any comments from you might cause me to write a few more paragraphs later.

@davevolek The democratic federation aims to address this practical issue. It offers companies startup capital in exchange for non-voting preferred shares in the co-op and pay a percentage fee the value of the firm’s capital assets to the federation in a manner similar to a Harberger tax. I’d also collectivize land across the federation in a #Georgist style. Leases and land fees would be paid in the federation’s currency, which would have exit and transfer taxes. What are your thoughts on this?

I think the co-op would have a difficult time raising capital with preferred shares. If I had venture money to invest, I certainly would not buy preferred shares.

The spolu gives investors a minority say on the board. That would be one feature to attract capital.

I did a Wiki-check on Harberger's tax. Details are scant. I cannot comment wisely.

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@davevolek The democratic federation is the one investing in individual worker co-ops. The democratic federation would be a social purpose corporation that would be required to only invest in worker co-ops and convert any corporation it buys into a worker co-op. The democratic federation would be a larger entity and non-voting preferred shares could even be publicly traded. Yeah the Harberger tax is essential to increasing return on investment.

I read some of what you wrote.

@davevolek I like the reinvestment requirement idea. It serves a similar purpose to the exit tax idea I mentioned from E. Glen Weyl’s work. Also, the exit tax ensures that there will be further returns to the network besides direct monetary since it will be cheaper for members holding this currency to invest in the federation and avoid the exit tax.

When I say spolus must pay taxes, i mean taxes based on profit. No profit means no tax.

Spolus that have several years of no profits would lose credibility in the spolu network. Kind of a self-enforcing motivation to find that profit-----and report it----and pay taxes on it---- and distribute the rest to the stakeholders.

As for property taxes, I have not thought of that aspect of taxation very much. I suspect it needs reform as well.

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@davevolek The idea here is the federation could require these tax-like fees from its members in its internal currency.