In my previous post, I wrote about Argentina’s financial collapse and the subsequent recovered factory movement that followed. This post will focus more on the nonprofit organization The Working World: La Base which has played a tremendous role in the movement by providing funding to these recovered businesses, and which I will also be working with during my upcoming trip to Buenos Aires.
*All information about The Working World was obtained from their website unless otherwise specified.
The Working World: http://www.theworkingworld.org/
History of the Organization
The Working World was the brain child of Brendan Martin, a resident of New York who had studied economics and cooperativism, and Avi Lewis, the director of a documentary about Argentina’s recovered factory movement titled ‘The Take.’ Upon seeing the very moving film, Martin approached Lewis with his financial network project and the two began to collaborate on the creation of a nonprofit organization (The Working World.org). The organization, which they called The Working World, was officially registered as a nonprofit in the U.S. in 2004 and serves as the overhead entity that manages and receives donations for the La Base Fund, which is the microfinance arm of the organization (The Working World.org). In 2008, La Base was also legally established as a Foundation in Argentina, which enabled the organization to apply for microcredit funds from the Argentine Microcredit Commission (The Working World.org).
Complete history of the organization can be found here: http://www.theworkingworld.org/index.php?action=About&subsection=1
The Working World is based on the idea that cooperatively-run businesses are highly efficient and beneficial to individuals and communities alike. According to the U.S. Federation of Worker Cooperatives, worker cooperatives are business entities that are owned and controlled by their members, or the people who work in them. The two general characteristics of worker coopratives are that workers invest in and own the business and that decision-making is democratic, generally adhering to the principle of one worker-one vote. Cooperatively-ran businesses follow a broader set of values in that although profitability is still desired, this need for profit is balanced with the needs of members and the wider interests of the community as well (International Co-Operative Alliance.org). The Working World believes that with access to capital, cooperatives are able to measure up to, and often surpass, traditional businesses in terms of efficiency and profit.
How La Base Works
The notion of microcredit is highly innovative and has been incredibly successful in allowing the poor to create self-sustainability in developing countries. According to the Working World, the microcredit revolution is based on the shattering of two of the most accepted conventional wisdoms about our economic system: that our current financial markets ensure the optimal allocation of resources, and that the best hope for the poor is for the wealthy to give them jobs. Microcredit ignores these ideals and offers loans to the uncollateralized poor with no enforcement of repayment, yet still maintains a higher rate of repayment than more traditional loans by credit lenders (The Working World.org).
The founders of the Working World believed that as successful as the idea of microcredit was, it had limitations in that it focused primarily on those at the very bottom of the pyramid, or essentially individuals who were poor and had not collateral (The Working World.org). The idea of loaning to a factory or business would then be moved beyond the realm of microcredit and into the realm of small-business loans by traditional lending sources such as banks and investment firms, because to loan to a company would be to loan to its owner, thereby not benefitting the employees at the bottom (The Working World). Microcredit is therefore limited almost exclusively to individuals and to the small-scale or cottage industry (The Working World.org).
However, The Working World sought to change this idea of only providing microcredit to poor individuals. Because most of the employees who work in the factories also have little or no collateral, they too do not have access to business loans from traditional institutions. Therefore, The Working World provides small loans to employee cooperatives so that just like with traditional microcredit, small loans without collateral are given to those with no options — the workers of sweatshop industries (The Working World). The benefits of microcredit are then spread to a much larger group of the worlds impoverished, and a working alternative to the sweatshop emerges (The Working World.org).
The Working World: La Base not only provides microcredit to factory cooperatives, but also works with them to develop a comprehensive project and business plan from idea to maturation in an industrial setting. A loan project typically consists of three cycles: a consultation period in which a loan agent meets with a cooperative to outline a project and submits the plan to La Base for analysis and approval, a creation period during with a detailed business plan and progress calendar are created, and a monitoring period in which progress is evaluated and solutions are created for any problems that the cooperative may have (The Working World.org).
Further information about the cycle of a loan project can be found here: http://www.theworkingworld.org/index.php?action=theory&subsection=2
Since 2004, The Working World has provided 558 loans to cooperatives in Argentina worth a total of AR$7,736,937. The repayment rate on these loans has been an astounding AR$7,512,602, or 97.1% of money lent (The Working World.org). Additionally, as a result of internal productivity gains, all this has been achieved without an increase in operating expenses (which average at about $65,000 per month) as a mature loan team and an active volunteer program ensures that a large amount of loans can be covered with the same overhead costs (The Working World.org).
A complete list of past and current loan projects can be found here: http://www.theworkingworld.org/index.php?action=labase&subsection=1
Open Movements and My Visit to Buenos Aires
The organization that will be facilitating my visit to Buenos Aires and visits to the recovered factories is Open Movements. Open Movements is a nonprofit, educational organization dedicated to developing the social economy and fighting economic exploitation through innovative educational, exchange, and developmental programs that functions in coordination with The Working World: La Base (Open Movements.org). Open Movements works to facilitate global exchanges of knowledge and leverages social networks by connecting professionals, students and organizations who are interested in worker-led initiatives with the recovered business movement in Argentina.
Open Movements offers three different options for those interested in the movement. The first of these is a Student Worker Project in which they have collaborated with the University of Buenos Aires’ Facultad Abierta program called the Centro de Documentación de Empresas Recuperadas (Center of Documentation of Recovered Businesses). Students who enroll in this program take classes at the University of Buenos Aires and receive credits that are most often transferable to their home universities, and are able to participate hands on by visiting recovered factories and learning about them. Another option that Open Movements facilitates is the Internship and Development Program which I will be participating in. As part of the internship, individuals are taught nonprofit fundamentals such as grant-writing and are given the opportunity to present the project to members of their team. If the project is accepted, Open Movements can provide a small grant to actually help the intern develop the project collaboratively with a recovered business (Open Movements.org). Moreover, Open Movements offers various tours throughout Argentina which incorporate visits to recovered businesses and offer learning opportunities about the social economy of the country.
When I came across this organization, I was very interested in the internship program that they offered. Although the typical internship duration is anywhere from 4-52 weeks, I contacted the director Steve Wong to inquire whether they would be able to coordinate something for me given that I was only planning on traveling for approximately two weeks. Steve and the Open Movements team were very helpful and came up with a two-week proposal that would give me the opportunity to visit and examine different recovered businesses to study workplace recovery as a solution to unemployment/under-employment and workplace democracy as an alternative economic model that builds real wealth in local communities and empowers workers to take control of their own lives. My trip will be facilitated by Open Movements’ team in Argentina, and will include site visits with some of the investment officers of The Working World: La Base. I will also have the opportunity to accompany The Working World’s investment officers and learn about the investment techniques used by WW and access their impact on cooperative La Toma, a recycling cooperative. Since I had also explained to Steve my initial interest in feminist issues, he also included the opportunity of visiting Brukman, a textile cooperative owned and managed by women to explore my interest in women’s mobilization and collective action.
More information about Open Movements: http://www.openmovements.org/
I am anxious and excited to work with Open Movements and The Working World learn more about this incredible movement and have the opportunity to visit some of these revolutionary businesses. Please follow along with me on this incredible journey!