A Co-operative Response to the Greek Crisis

Three years have now passed since the Greek debt crisis exploded in Europe.

By now, the "rescue" imposed by the International Monetary Fund was supposed to have triggered a growth in the economy of 2.8 per cent. Greece was to be basking in a "heightened sense of confidence," new access to markets, and a declining ratio of debt to GDP.

It was this kind of false optimism, and adherence to the easy moralism of their austerity policies, that has enabled the pundits of the IMF, The European Central Bank, and of course the German Bundessbank, (the so-called Troika) to transform farce into genuine Greek tragedy as the nation's economy continues to spiral downward.

Unemployment rates hit 27 per cent this year and suicide rates have quadrupled since 2009. Among youth, unemployment stands at an eye-watering 70 per cent. On the once busy shopping avenues 40 per cent of the stores have closed. No one has any sense of where this will end.

All of this gave me a sense of foreboding about the upcoming trip to visit my family in Athens.

The memories of the street riots from a few years before and the plumes of tear gas rising up from the graffiti scrawled streets were very fresh in my mind. It was then that I had first noticed the worrying publications of a new fascist political movement -- Golden Dawn -- that was gaining strength and making itself felt publicly for the first time.

Instead, Athens turned my expectations on their head. Alongside the gloom there was an unmistakable sense of forward movement, of optimism, of people finding new ways of coping where the old patterns had been played out. New models of enterprise were being tried out in which sharing and mutual benefit replaced the established models that many feel have betrayed them. Everywhere it seemed, people -- especially youth -- were experimenting with new forms of economy.

Groups of friends are pooling money, and resulting profits, to run coffee houses. Employees have purchased a popular radio station and are now running it as a co-operative. There are impromptu farmers' markets. All over, people are being forced by circumstance (and disgust at a failed system) to venture into what is, for Greece, unchartered territory.

Among the most inspiring of these efforts is the worker takeover of Bio Me in the northern city of Thessaloniki; the first worker-run factory in Greece.

Story of a takeover

Bio Me is situated at the outer reaches of the city where the urban centre bleeds into the industrial suburbs that have the typical look of nowhere. Just next to the factory is the vast expanse of a parking lot that surrounds the familiar blue and yellow bulk that is IKEA. I arrived here with Makis Anagnostou on a blistering Monday afternoon to meet the workers that had taken over the factory after it had been bankrupted and abandoned by its owner. That was in July, 2011.

Makis is a bear of a man. He sports a thick moustache reminiscent of Nietzsche, and intense brown eyes that give life and force to the passion with which he speaks, easily and at length, about his ideas and his mission at Bio Me. He is a workingman's philosopher. And although he has no formal title, he has emerged as a spokesman for the group.

On my arrival in Thessaloniki, Makis picked me up on a monstrous Kawasaki that carried us off growling through the streets of the city in search of food and a quiet place to talk. He was warm and hospitable and open in that way that only Greeks can be as he related to me the remarkable story of Bio Me.

Bio Me produced industrial adhesives and glues for the ceramics industry. It was profitable. Between 2000 and 2006 sales doubled and European revenues held steady despite the recession. Bio Me was at this time one of the top twenty firms of Northern Greece.

But the factory was also part of a company group whose owner had taken on a debt of nearly three million euros to finance expenditures at Filkera & Johnson, the mother company. This debt was being financed wholly from the revenues of Bio Me. In addition, the holding company was carrying an existing debt of 35 million euros that became impossible to pay when the crisis hit. By April 2009, the revenues of the company were no longer sufficient to carry both the debt and operating costs. Bio Me was unable to pay its workers.

The workers at the factory feared for their jobs. They had seen what was happening and alerted the owner that not only was the factory being put at risk, but that it was unethical to imperil in this way the livelihoods of its employees. During this period, through cost-cutting measures initiated by the workers, Bio Me was able to slowly close the gap owed to workers.

But on July 27, their worst fears were realized when the owner abandoned the factory and disappeared with the debt still unpaid. The board of directors disappeared shortly after. It was a factory without a head.

Despite this, the Bio Me employees continued to work to try and save the company. To raise revenue, they started a recycling program that netted them over 36 tons in waste paper alone. By selling this and other recyclable waste the factory earned enough money to help pay for the essential living costs of workers who were in most desperate need of help. There were fears that some might take their lives, as had been happening with frightening frequency throughout Greece.

A new, ancient approach

The idea to form a co-operative took root soon after a small group of workers, Makis among them, began meeting to discuss how to save their jobs. They understood that a factory operating under direct worker control had to be run along entirely different lines.

Co-operatives have a long, and largely forgotten, history in Greece. During the Ottoman era co-ops played a crucial role in the Greek war of independence by using their capital to provide arms and supplies for the guerrilla bands that led the revolt against Turkish rule. Nearly a century before Rochdale in the UK, the residents of the small mountain village of Ambelakia just south of Thessaloniki, organized what is now regarded as the world's first modern co-operative.

The Common Company of Ambelakia managed the production and shared the profits from the sale of the scarlet red yarn that was famous in that region. In 1780 more than 6,000 residents of this village -- men, women, and children -- owned shares in a community co-op that had 24 workshops, warehouses, laundries, dyeing facilities, as well as trading agents and co-op branches in Vienna, Trieste, Dresden, Hamburg, Amsterdam and London where the yarn was brought to market by the co-op's own ship, the "Calypso."

What Makis and his friends found as they sought a solution to their employment problem was that, in this time of crisis, the co-op was being rediscovered.

They were inspired by the example of the coffee house where they regularly met -- it was owned and operated by the young employees who worked there. If they can do it, they reasoned, why can't we? They took the proposal to a Bio Me workers' meeting.

"Everyone was there," Makis said. "Forty-two workers. When a vote was taken to form a co-operative to save the plant, 98 per cent voted in favour."

Today there are between 25 and 30 workers who work for the co-op. Everyone receives the same pay regardless of what they do or how long they have been there. All decisions are made in a general assembly by those who are present. And everyday brings with it a host of difficulties and obstacles to overcome. When I was there, the issue of the hour was how to prevent the electricity from being shut off.

Working against the system

Here's the irony: Despite the fact that there are willing customers for the company's products, bankruptcy laws in Greece severely limit the rights of workers to benefit from the assets of a bankrupt firm, even if those workers are owed wages.

The factory warehouse is filled with unsold product because its sale would generate a government clawback which, when added to the cost of marketing and transport, would result in a net loss. To complicate matters, Greek corporate law has no provision for a worker-owned company.

Most co-ops in Greece are incorporated under legislation that limits co-ops to agricultural or community purposes. Nothing has been done to explore co-operatives as a possible strategy for economic revival. And so, with austerity on full throttle, the government is also ignoring the one solution that could actually salvage jobs and help restart the economy. But that would mean challenging the primacy of capital.

Bio Me's first demand is for legislation that would allow it, and the thousands of other firms that have been abandoned by their owners, to legally incorporate as worker-owned firms if the workers so choose.

They are also demanding that workers be entitled to use the value of owed wages and their unemployment insurance to buy and operate their factories. The changes have been promised by Alexis Tsipras, the young leader of Syriza, the new left-wing party that has emerged as a major force from the turmoil of the crisis. The workers of Bio Me meanwhile have said to the government, "...we're here to stay, we're not going to stop working, and when you're ready with legislation, we'll talk."

Meanwhile survival is a major struggle. A number of banks are prepared to help, but only when the co-op is legally incorporated. Until then, the co-op can't raise the capital it needs to fully run the plant. And so Bio Me has had to re-invent its business with the resources that are available.

Today the co-op is out of the glue business and survives by producing small batches of organic household cleaning products that it sells exclusively through the informal networks of the new solidarity economy.

At demonstrations and meetings, at the countless political events and solidarity concerts, Bio Me has become a familiar sight. Support for the co-op is growing. Sales of its organic cleansers are set to triple. The fight for the factory also attracted its share of limelight when Naomi Klein and Avi Lewis came to bear witness to the importance of Bio Me at a time when real solutions to the crisis have been so lacking.

It is not only as a symbol of resistance and survival that Bio Me has won such broad appeal. The co-op has also committed itself to support community efforts to rebuild the shattered remains of health and welfare services in local neighborhoods and to provide solidarity and advice to other fledgling co-ops and factory workers. Makis is constantly on the road responding to invitations to speak -- and his message is resonating.

'What alternative is there?'

The solidarity that Bio Me is building is in a very real sense the passing of a torch that it received from the recovered factory co-ops of Argentina, which came to offer help early in the struggle.

More than 250 bankrupted factories in Argentina, abandoned by their owners, were turned into worker co-ops and are still operating.

Bio Me is pointing to a radically new direction about how the workers of Greece and other failing economies might rethink the strategies of resistance they need to pursue if they are to achieve substantive, systemic change. Protest strikes and street demonstrations are one thing. Factory occupation and production under worker control is a new ball game altogether.

The Bio Me model questions the very idea of the sovereignty of capital. Equally transformative is Bio Me's vision of a solidarity economy network that operates outside the conventional market system to support models that rely on a wholly different set of values for serving people's real needs.

Makis and his fellow co-operators are fully aware of the role they are playing in the effort to re-imagine what an economics of equity and justice might look like. And they are under no illusions as to the enormity of the task ahead. But as he said with a characteristic shrug of his shoulders, "What alternative is there? What else can workers do?"

On the streets of Athens, amidst the graffiti and the shuttered storefronts, the countless posters cry out their messages of rage, of resistance, of the imperative of change, of bitterness and of hope together. Solidarity concerts seem to take place every other night. Young people fill the plazas every night. And in the quiet back streets of Monastiraki, the old flea market of Athens, the crowded cafés exhale the warm, fragrant aromas from the hookas that are once again in fashion. What was old is new again.

And just so, the old and half-forgotten idea of the co-operative is rising once more from the mountain mists of Ambelakia to give a sense of direction and form and purpose to a desperate and searching populace. For seasoned workers like Makis and his friends struggling to rebuild what they once had, and most of all for the youth who see no future in the failed policies and politics of the past, the co-operative ethic of Bio Me serves as a slender thread that promises a way out of the dim labyrinth that is Greece today.