Transcription
You know the problem. What industry wants, industry gets. We don’t even exist in their minds. They’s not creating jobs. Now it’s getting to the point where people are beginning to demand answers. (Faiz)
If you're anything like me, you want to know: What can we do about it? What are some solutions that could fundamentally transform our political and economic systems? So many political ideas today seem stale and recycled. (Sen. Schumer) Democrats are trying to extend the credits for three years. (Rep. Jeffries) We want to focus on combating corruption. (Sen. Kelly) Mr. President, let's cut the red tape. (Faiz)
We're going across the country to meet people who are injecting fresh, bold ideas into the realm of what's possible. (Cassie) If we do it the way we've always done it, we're never going to progress. When things get as bad as they've gotten, people start taking their destiny in their own hands. (Faiz)
To start a much-needed conversation about the kinds of ideas that our political candidates should be talking about if they actually want to improve the lives of working-class Americans. This is Big Ideas, a new series from More Perfect Union. First Big Idea: Break up the multinational corporate model that has a stranglehold over America, and replace it with something that gives us more power over the wealth that we create.
Consider two rideshare apps, from the perspective of a driver. For the same route, one pays you $17. The other? $42. How is that possible? Well, it comes back to a big idea that drivers here in Colorado have been coming together to fight for. Ahmed used to make a decent living driving for Uber. But in the last few years he, like most other drivers, had a big problem. You figure out these things is a trap, you know what I mean? (Faiz)
More Perfect Union has investigated this — how Uber transformed a once-decent job into low-paid gig work managed by an algorithm. Ahmed's experience was no different. (Ahmed) I always talk to myself. I said, what's the alternative? What's the solution for this? (Faiz)
Ahmed and a group of other drivers came together with a big idea. Last year, they founded Drivers Coop Colorado, a rideshare company to compete with Uber and Lyft. (Ad) Looking for a better way to move around Colorado? Welcome to Driver's Coop Colorado, the fair, local alternative to traditional rideshare. (Faiz)
Unlike those companies, the co-op is not owned by Wall Street investors. It's owned by the drivers themselves. Now the drivers control what they are paid — 80% of every fair, actually — and collectively, they govern each aspect of their business. That’s the big idea we want to discuss with you — how it could transform our lives if more of our companies were organized as co-ops. A co-op is a kind of corporate form where a group of participants in the business come together to own the business collectively. (Faiz)
Hans Taparia is a writer and business analyst who studies how companies are structured. He told me there are many kinds of co-ops. They can be worker-owned, like the Drivers Coop. Producer-owned, like some food companies. Depositor-owned, like a mutual savings bank. Or consumer-owned like a co-op grocery store. (Co-op member) Welcome, everyone, to our monthly town hall. My name is Isaac. (Faiz)
Since launching in 2024, about 1,400 drivers have joined the Drivers Coop. They handle about 2,000 rides a month, for about 20,000 people in Colorado who've downloaded the app so far. We move to the next, um — item, which is Ride Statistics Update. (Faiz)
Some co-op drivers still use Uber and Lyft as well. But on average, a Coop ride makes them 2 to 3 times more money. And for customers, the Coop's prices are usually the same or better. (Coop Driver) The other guys can run big promotions and stuff like that. That's not our lane. But on average we are cheaper and our drivers make 50% to 100% more on some rides. I took one from Lakewood to the airport, and that ride was — paid me $42 on the Coop. It would’ve paid me $18 on the other guys. This is why I drive Coop. You see that? Passenger pay $51. (Producer) This is Uber. The rider paid $51. Look at what I got. $17. That's why you drive Coop right there. If this was a Coop ride, I probably would’ve got like $45 of this $51. (Faiz)
But the Drivers Coop faces a set of challenges shared by most co-ops: Can these grassroots experiments really compete with massive multinationals like Uber and Lyft? Co-ops have a long history in the United States. They crop up at times when industries have become concentrated and the market has failed. In the early 1900s, farmers formed co-ops to fight back against wholesalers who controlled their trade. In the 1960s and 70s, people formed grocery co-ops in reaction to corporate food conglomerates. But if the co-op model has never truly flourished, a big part of the reason why is the difficulty of securing capital in a financial system that's more oriented towards maximizing shareholder returns. (Bruce) It's a lot easier to get investors together. (Faiz)
Bruce Buchanan is co-author with Hans on a book about alternative business models. You promise them a certain return, you show them the term sheet, and they sign on. (Faiz)
Our economy, of course, is dominated by that kind of company: the investor-owned firm. As those firms have grown into huge multinationals, they have accumulated more political and lobbying power over our system. And they've had less incentive to compete — both to improve their products or services, and to provide the best workplace for their employees. Instead, they have faced pressure, above all, to return money to one group: wealthy investors. The American corporation, really, in the late 70s, early 80s, kind of did a turn towards maximizing earnings per share. Roughly half of the financial wealth in the country is the top 1%, and the top 10% have close to 90% of all the financial wealth in the country. So we're talking about the top few percent are the owners. Much of that wealth is overseen by huge asset managers, like BlackRock, State Street, and Vanguard. Institutional investors are infiltrating communities in a way that never happened before. Today our car washes, our bowling alleys, our medical practices, our plumbing contractors, our physical therapists, our nursing homes are increasingly institutionally-owned. And these are institutions that are not connected to that community in any particular way. (Faiz)
We saw this recently in Nebraska, where Tyson Foods, the investor-owned agribusiness giant, closed an important meatpacking facility. (Rancher) During COVID, the fact that we need to have more regional plants was very evident. Cassie Lapaseotes raises cattle on her family-owned ranch. There was a major, major bottleneck during that timeframe. And it was really scary as a producer, because it's out of your control. (Faiz)
The bottleneck was at Tyson. As COVID spread throughout its facility, Tyson slowed down operations, bringing Nebraska's livestock industry — the second-largest in the country — nearly to a halt. For farmers, there was pretty much nowhere else to go. (Cassie) When that animal is ready to go, there's a — there's a short timeline when that animal needs to be harvested. (Rancher) There is a timeliness to getting these cattle processed. (Faiz)
Trey Wasserburger raises cattle in North Platte. He told us Tyson’s slowdown was an existential crisis. (Trey) We put five years into our model of raising the bull that goes out and sires the calf, and then bringing the calf back and feeding them — takes five years to get there. And then we were not having any kind of control of our destiny in the last 24 to 36 hours. (Faiz)
So Trey and his father-in-law hit the road to meet with dozens of ranchers in the region, including Cassie. They showed up with an idea: Why don't they create their own meatpacking facility, which they would own? (Trey) You're getting together cattle feeders that are very independent and individually-minded. It's funny, you get to know ‘em, like how much their problems you’re experiencing as well. I think every small feeder has had that vision in their mind like, I should do that. That instead of feeding cattle for a year and then taking a price in the last 24 hours, maybe I should have some control over that. (Faiz)
Within a few months, enough cattle ranchers had signed on to purchase a building site. (Hans) They got together and they started one of the most state-of-the-art meatpacking facilities in America today. (Faiz)
To raise the enormous amount of capital needed to build the plant, the founding group of farmers got help from local and state government, as well as from an unlikely partner: Walmart. (Trey) They were on the opposite side of packer consolidation. They weren't getting the beef. We couldn't get the cattle in and they couldn't get it on their shelves. (Faiz)
Walmart agreed to finance construction, in exchange for a stake in the business. The ranchers preserved majority control of the company's board, creating a unique partnership between a small group of farmers and the country's largest retailer. (Cassie) We're able to have conversations with Sustainable Beef that you're not able to have with the other packers. I can pick up the phone and say, guys, I don't understand these numbers. Where are we coming from? (Trey) There's a trust there now that yes, I will have a spot to take my cattle. Yes, I will be treated fairly. And so now it's just a sense of purpose and not just being a soldier for the machine. Washing your hands of it, pay me what you pay me. (Faiz)
So many parts of our economy are plagued with high costs and corporate control. What if we tried more co-ops in all of them? What if instead of investors standing between you and your doctor, your community owned the local hospital? What if you and your neighbors could easily pool funds to create your own insurance company? There's really no need to have investors or shareholders in an insurance business. This is about a community coming together, pooling their money together in return for getting paid out during a rainy day. So we need to take shareholders out of that system. (Faiz)
We think of technology as driven by Silicon Valley's venture capital model. But digital platforms, cooperatively-owned, could operate differently. (Hans) Wikipedia is governed entirely by its content creators and its community of users. It has 16 board seats that come from its community. And if you look at Wikipedia over the past 15 years, it's largely gotten better. Meta, meanwhile, is governed by one person and is owned largely by institutional investors. And from a societal point of view, it's largely gotten worse. Can we see a world where social media is user-governed or user-owned? Would we see a different outcome? (Faiz)
In the United States today, people are losing more and more economic freedom because investor-owned companies set the rules of the marketplace in ways that entrench their power. We need more economic democracy — less power in the hands of monopolists, and more in the hands of workers, consumers, and producers. To accomplish that, political leaders at all levels should look at what they can do to make it easier for people to create co-ops. The clearest way to do that? Help co-ops get the capital they need to launch and compete. (Hans)
Employee-owned businesses have tremendous track records of success. Banks don't like to finance them, though, because there's no one individual to do a personal guarantee. The government could say, we’ll back that bank loan. That's a powerful catalyst. The government could launch a fund that supported the financing of worker buyouts of companies. (Faiz)
Governments should choose to do business with co-ops instead of the usual investor-owned firms. If you look at the amount of government money spent in building major real estate projects, if you look at the CHIPS act or the so-called Inflation Reduction Act, all sorts of government money going into high-tech industries. All investor-owned. That money is going to the investors, ultimately. Government supports business. I think government should support small business just as they support large business. (Faiz)
This year in New York City, Mayor Zohran Mamdani launched the first free childcare program for city workers, and he hired a 100% employee-owned company to run it. Entrenched business lobbying groups like the U.S. Chamber of Commerce will undoubtedly object to using government in this way, saying we shouldn't pick winners and losers. But the truth is, we already do that. As billionaire investor Warren Buffett once said, “There’s been class warfare going on the last 20 years, an my class has won.” It's long past time for the working class to win the class war. We need companies more beholden to their communities, and not just Wall Street.