NCBA - National Cooperative Business Association

01/16/2020 | Press release | Distributed by Public on 01/17/2020 09:22

Trust busting: Can tech giants be limited to give co-ops room to grow?

Delegates at the 2019 Platform Cooperativism Conference explored ways platform co-ops can compete in a landscape dominated by tech giants. [photo: Trebor Scholz]For co-ops and small- to medium-sized businesses in general, competing in a world dominated by corporate giants-with their huge lobbying power, ability to bid for contracts at scale and resources to develop new products-is a difficult task.

Among sectors affected by this unequal playing field is the emerging platform co-op movement. At the annual Platform Cooperativism Conference, held in New York at the end of last year, delegates discussed problems such as poor access to capital, the dominance of the landscape by firms by Uber and Amazon, and the threat that any innovation by a platform co-op opens up the threat of competition from the conventional business sector.

Anti-trust measures against tech giants like Facebook and Google could go some way toward opening up space for a more pluralist, people-centered tech economy to develop, it was argued.

In a plenary session, Nathan Schneider, assistant professor of Media Studies at the University of Colorado Boulder, and Sandeep Vaheesan, legal director of the Open Markets Institute, a 'progressive, anti-trust organization,' discussed the issue.

Vaheesan said there is now 'a real and broad public and political interest in anti trust,' with an 'almost trans-ideological consensus' on limiting the power of organizations like Facebook.

But he warned that anti-trust measures have also been used against 'the co-operation and collective activity of workers and small firms,' especially in the ride-hailing sector.

Instead, he advocated a return to anti-trust ideas developed in the late 19th century, when the Sherman Act was introduced to rein in the power of plutocrats like John D. Rockefeller, with the aim to 'decentralize markets and democratize the firm' and promote co-operative organizing among farmers and urban workers.

Schneider said this led to the populist movement of the 1890s; and, just as now, there were anxieties 'about the problem of demagogues, about creating a populism that would turn power over to those who would misuse it.' The antidote was co-operation: 'a way that people would find their power, recognize their power and create an empowered populism, grounded in the experience of collective enterprise.'

However, Vaheesan warned, the Sherman Act was a two-edged sword and was used to bust worker solidarity in the 1890s-prompting further legislation to prevent such abuses, such as the 1922 Capper Volstead Act, which allowed collective bargaining and co-operative action.

A modern version of this act could give collective bargaining rights to Uber drivers, McDonalds' franchisees and so on, Schneider said, helping to build democratic alternatives to the gig economy.

He said anti-trust legislation is 'a charter of economic liberty for ordinary people' and could be the basis of a 'popular mass movement,' adding that it was important to tell legislators that it should not be 'a tool for the Chamber of Commerce and Jeff Bezos to crush the workers and small suppliers on whom their businesses depend.'

Schneider added: 'When we build power through these kinds of structures, through our co-operatives, through our so-called new economy… these forces have shaped our world in ways we don't appreciate, and can shape the social contract of the future.'

Meanwhile, Trebor Scholz, director of the Platform Co-operative Consortium, said other regulatory measures are needed, citing the work of sociologist Karl Polanyi, whose 1944 book The Great Transformation critiques the market economy. In the book, Polanyi suggests slowing the implementation of technology to give alternatives the time needed to experiment and develop.

But Scholz says he is 'deeply pessimistic about the chances for sweeping regulation on the federal level in the United States-no matter who wins the next election. The system is so deeply dysfunctional. Both Democrats and Republicans have contributed to systemic economic inequality.

'I'm very hopeful about a new municipalism. But on a federal level, I very much doubt that anti-trust policies will actually be implemented,' Scholz said.

His other favored alternative is for the co-op movement to throw its weight behind the development global tech solutions.

'The International Cooperative Alliance is the only institution that has the global leverage among co-ops to coordinate an international transportation platform,' he said. 'I think in that sector, we really need a global tech solution. Thousands and thousands of co-op drivers will be unemployed in two to three years. Action is urgently needed.'

Watch the full session.