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AOC Knows Exactly What the Problem Is With Billionaires Like Jeff Bezos

Jeff Bezos is donating billions of dollars through his new foundation. But as Alexandria Ocasio-Cortez argues, we need to redistribute his power, not just his wealth.

Amazon CEO Jeff Bezos announces the cofounding of The Climate Pledge at the National Press Club on September 19, 2019 in Washington, DC. Paul Morigi / Getty for Amazon

On Monday morning, Jeff Bezos announced the creation of a new $10 billion environmental foundation, the Bezos Earth Fund. This is on top of the $2 billion he already committed to the Bezos Family Foundation to build preschools and fight homelessness.

The combined sum might be a fraction of his net worth, and Bezos might have a history of standing in the way of political efforts to address some of the same problems he seeks to address with his charity. Even so, many would argue that his efforts are still praiseworthy.

In a Martin Luther King Jr Day discussion with Ta-Nehisi Coates, Alexandria Ocasio-Cortez  argued for a very different perspective. If Jeff Bezos “wants to be a good person,” she said, he should “turn Amazon into a worker cooperative.” She argued that our primary message to billionaires shouldn’t be that we want to redistribute their money. Instead, it should be that “we want their power.”

In making this distinction, Congresswoman Ocasio-Cortez was giving voice to an idea with deep roots in socialist thought — that the unequal distribution of wealth is just a symptom of the deeper problem of the unequal distribution of economic power.

To see her point, take one of the most often cited indications of wealth inequality — that the average American CEO makes 265 times the salary of the average American worker. (This is actually one of the more conservative estimates. An analysis released by former Minnesota congressman Keith Ellison puts the differential at a staggering 339 to 1.) Where nonsocialist progressives typically think that the proper solution to excessive inequality is redistributive taxation, socialists think the underlying issue is a matter of who gets to set pay scales in the first place.

An interesting piece of real-world evidence comes from the example of the Mondragon Corporation in the Basque region of Spain. With eighty-five thousand worker-owners, it’s the largest worker cooperative in the world today. The average Spanish CEO makes 143 times the salary of the average Spanish worker. Even in a business environment where Mondragon has to compete with traditional hierarchical businesses that can lure skilled managers away with higher salaries, the maximum pay differential between the highest-paid executive and the lowest-paid worker allowed by Mondragon policy — set by the General Assembly, where all eighty-five thousand workers get a vote — is capped at a paltry six to one.

I’ve been a socialist for long enough that I can remember a time when hearing one of the highest-profile congresswomen in the country advocate the transformation of big businesses into worker cooperatives would have been unthinkable. I find the change refreshing. Unsurprisingly, not everyone shares this reaction.

The Libertarian Critique

Michael S. Rozeff argues that since Amazon workers who “made wage bargains with Amazon and didn’t form a cooperative” were freely choosing the first course over the second one, if Bezos is a bad person for not restructuring Amazon as a worker cooperative, his employees share the blame.

Liz Wolfe at Reason claims in her response to Ocasio-Cortez that a cooperative form of organization “is unlikely to work for a company of Amazon’s size.” She backs up this point by quoting an older article by John McLaughry that claims life in “[a]n unstructured participatory workplace” can lead to “problems of severe emotional intensity.” He mentions “rage, tears, splitting headaches, and other real stress afflictions.” McLaughry concedes that such experiments might work despite these problems in cases where “everyone involved comes from a common cultural, ethnic, racial, or political background,” but he says that “success can be close to impossible” when this is not the case.

Putting Rozeff, Wolfe, and McLaughry’s points together, we get the following objections to converting Amazon into a worker cooperative:

  1. Despite the unviability of cooperatives, if Amazon’s workforce preferred a cooperative form, they would have formed a cooperative to compete with Amazon.
  2. Even if cooperatives are generally viable, Amazon is too big to function as one.
  3. Amazon workers are too diverse to handle democratic decision-making together.
  4. The transition to democracy in the workplace would be too stressful and upsetting for Amazon workers to handle.

An obvious problem with the first point is that it ignores considerable barriers to entry. Research on worker cooperatives shows that they’re at least as efficient as other firms. Once they get going, they do about as well and last about as long as regular capitalist businesses. The problem isn’t a higher death rate — it’s a considerably lower birth rate.

There are many reasons for this, but an obvious one is that it’s easier to attract investors for a new business if you can offer them ongoing ownership shares. That’s why Karl Marx praised worker cooperatives as “great social experiments” that provided a valuable proof of concept that it was possible for “modern industrial production” to take place without a division between “a class of masters” and “a class of hands,” but he said that actually transitioning to an economy based on workplace democracy would require political struggle.

The second objection makes sense — if we assume, as Wolfe and McLaughry seem to, that turning Amazon into a worker cooperative would mean “unstructured” participatory workplaces — endless mass meetings striving for consensus on every issue. But there’s no reason to assume this. Workers (at individual fulfillment centers and throughout the company) could elect a management structure in the way that they do at Mondragon.

To be sure, this isn’t a panacea. There are serious critiques of the Mondragon model that advocates of worker cooperatives would do well to grapple with — but the question isn’t whether working at Amazon would be a workplace utopia blissfully free of worker alienation and other problems if it were converted into a cooperative. The question is whether it would be better.

The best counter to the third objection is the real-world history of the labor movement, which has proven over and over again around the world that workers from diverse ethnic, cultural, and political backgrounds can work together in democratic organizations to decide what they want to be paid, how they want their workplaces to function, and so on. The only difference is that in a unionized workplace, the workers have to negotiate with a boss (who has more bargaining power) about how many of these plans come to fruition. In a cooperative workplace, the democratic decision of the workers or their elected representatives is the final say.

As to the fourth objection, it’s true that getting to make decisions for yourself can be stressful and upsetting. The question is whether this would be more or less stressful, upsetting, exhausting, and demoralizing than working in the rigidly hierarchical structure Jeff Bezos currently imposes on his workforce.

Rozeff might think that Amazon workers “chose” to work at the company rather than going into business for themselves, but the severe inequality in bargaining power between an ultra-wealthy corporation and its atomized “associates” means very few of their preferences are reflected in the company’s policies. A full 91 percent “wouldn’t recommend working there,” 89 percent described themselves as “exploited,” 71 percent “reported walking more than 10 miles per day” during their shifts at fulfillment centers, and 78 percent “felt their breaks were too short.”

Former Amazon “associate” Candice Dixon reported having to scan a new item once every eleven seconds to meet her quota. “Amazon always knew” if she didn’t. This nightmare of “cutting-edge technology, unrelenting surveillance, and constant disciplinary write-ups” led to Dixon destroying her back.

Today, not only can she not work at the company, she can “barely climb stairs.” This experience isn’t unusual. The rate of serious injuries at Amazon fulfillment centers is more than twice the national average for the warehousing industry — “9.6 injuries per 100 full-time workers in 2018, compared to an industry average that year of 4.”

Congresswoman Ocasio-Cortez’s proposal to convert Amazon into a cooperative might not solve all the problems of its workers in one fell swoop. Democracy in any sphere can be complicated and messy — and it might indeed be stressful. It would, however, probably be a lot less stressful than working for a company that cares so little about your preferences that, in its constant drive to fill orders a little bit faster, it’s willing to literally maim you.