An alternate economy

by Letters Editor · June 21, 2012

From Finbarr Flanagan OFM, Pretoria

Father Bonaventure Hinwood (May 30) asks for suggestions for ending poverty and hunger, but only good economics can do this. In April 2012 there was a seminar on Alternative Economics Models at UCD Dublin. The guest speaker was David Erdal who has written a best-selling book, Beyond the Corporation, which discusses the idea that when employees own the business, productivity improves.

It is a book for our times, offering inspiration and vision in the wake of financial meltdown. It is essential reading at a time when the orthodox corporate economy has been badly shaken. Erdal provides lots of stories of success models not will o� the wisp theories, including the Mondragon Co-op in Spain�s� Basque country��a convincing example of what can be done if Catholic Social teaching is taken seriously� (The Month, May 1977).

It was a cause of fascination in the 1970s, before the globalisation juggernaut came along which mesmerised people�s critical faculties with its promises of instant gratification.

Mondragon was set up over 50 years ago by a young Basque priest, Fr Arizmendi, in a region devastated by war. The Guardian newspaper called it an �unparalleled social and economic experiment which has transformed the region. It provides one of the most exciting examples in the contemporary world of what can be done when the classic conflict of capitalist society, between capital and labour, has been superseded.�

Erdal states that Europe�s second- largest coach manufacturer and fifth largest manufacturer of electrical appliances belong to Mondragon.

The workers are keen and happy, and so no one has ever been sacked and there has been only one strike when a co-op grew too large and personal relationships had broken down. As the economist EF Schumacher put it: �Small is beautiful!�

I believe that co-ops like Mondragon can play a significant role in what Pope John Paul II called �the indispensable transformation of the structures of economic life�.