Could worker-owned co-ops help jumpstart the economy?

The recession dealt a particularly hard blow to California--one of the worst victims of the housing crisis and the poster child for state budget dysfunction. But tough times have also forced some California
A foreclosure sign hung in front of a home in Richmond, Calif., last spring. (Justin Sullivan - GETTY IMAGES) towns to find creative ways to get back on their feet. In Richmond, for example, unemployment reached 19 percent at the height of the recession. It’s only dropped three points since then, as businesses everywhere are still nervous about hiring. So, Richmond’s Green Party mayor, Gayle McLaughlin, is trying out a new employment strategy: worker-owned co-ops. Fast Company explains:

As of January, the first co-op born from this campaign, the aptly named Liberty Ship Café, is up and running, with plans for new bike shop, bakery, urban agriculture, and solar installation co-ops on the way...The people who work in and own them still want to turn a profit. In this model, however, there is no gulf between the lowly employee and the business partner. All decisions are made communally. And by starting their own businesses, people who might not be employable in the traditional economy gain access to both jobs and control over their own labor...

In January, the Liberty Ship Café launched in a booth at the local farmer’s market, with the help of the California Center for Cooperative Development, which is also working with the city to fulfill McLaughlin’s vision. The café today has just three worker-owners, immigrants from Guatemala and Mexico, and it does not yet provide a full-time job for any of them. Every Friday, they sell healthy sandwiches, salads, and empanadas at the farmer’s market, and the business is expanding into lunchtime catering around town.

My Washington Post colleague Ariana Cha recently profiled another California town, Vallejo, that’s using new technology, volunteer help from residents and participatory budgeting to get its fiscal house in order after declaring bankruptcy.
After the city of Vallejo, Calif., declared bankruptcy in 2008, it used creative ways to get back on its feet. (David Paul Morris - BLOOMBERG)