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Until 1971 then, Italian co-operatives, though numerous, were, for Restakis, of a limited size. But the 1970s marked a turning point for the movement. The model began to take off, accelerating rapidly during the 1990s when cooperatives seem to have capitalized on an accumulation of experience, managerial and strategic skill, the formation of co-operative networks and the skilful deployment of co-operative capital to fuel growth. In 1971 co-operatives with more than 500 employees represented 2.3 per cent of all Italian companies of this size. By 2001 this figure had risen to 8.1 per cent. This growth amongst the largest co-operatives is the opposite of prevailing trends amongst capitalist firms.

During the 1990s, the number of people employed by co-operatives in Italy grew by 60 per cent against an average of 9 per cent for capitalist firms. In particular, the 1991 census gave the numbers of workers employed by social co-ops as 27,510; this figure had risen more than fivefold, to 149,147, by 2001. Overall then, Italy's co-operative movement has become larger, more concentrated, more complex and far more powerful within key sectors of the national economy. How has this happened? The answer seems to lie within the ethical and social capital relations among co-operatives themselves once a critical mass of enterprise has been reached. In addition, the presence of coordinating umbrella institutions capable of creating new partnerships, discerning long-term strategic opportunities at industry levels and mediating the establishment of sector-wide resources has been a key factor in the Italian case. One instance that illustrates this networking capacity is the integration and scaling up of the co-op construction sector. The CCC (Consorzio Cooperative Construzione) now has 230 member co-operatives employing 20,000 workers. This co-operative networking strategy has also been applied in the co-operative retailing sector, in the service sectors, in co-op financial services, in the growing social care sector and more recently in agriculture and food production.


Initially then, for Restakis, the region's agricultural economy gave rise to the specialized industries that emerged as an extension of its needs. The processing and packaging of food products gave rise to the design of specialized machinery that is still the singular expertise of the area. As early as the first decades of the 19th century, Emilia Romagna led Italy in the application of machine production for agriculture that evolved to respond to the unique requirements of a whole host of industries, from ceramics and textiles to surgical equipment and high performance cars.

Eventually, over 100 industrial districts bloomed in Emilia Romagna, each one composed of highly specialized firms clustered around a town or region and producing a characteristic product for export to the rest of Italy and abroad. This is Italy's largest exporting region, accounting for 13 per cent of the country's total. The production model of the industrial districts depended on the willingness of local entrepreneurs to co-operate while remaining competitors. It rested also on the involvement of the regional government in understanding the strengths and weaknesses of this system and devising strategies, in partnership with stakeholders, to allow the system to adapt to internal and external threats. A key to this approach was in understanding that the industrial districts are organic economic forms. They are not static and they evolve. How this comes about is a combination of political vision, the skilful management of competing interests, and the possibilities that are latent in the social relations fostered by a culture of co-operation – the region's social capital.

The 1919 elections, for Restakis, were a watershed for Emilia Romagna as it has been ruled by a Communist administration or some combination of Social Democratic and Communist coalition since that time. What ensued provides a blueprint for how governments can play a catalytic role in analysing, mediating and mobilizing strategic interests in the building of a regional small firm economy. ERVET Emilia Romagna Valorizzazione Economica del Territorio, as a regional economic development agency, is funded and directed by a partnership between the regional government and its key allies amongst business, labour and academic institutions. It has undertaken a careful analysis of the region's key economic sectors, diagnosed the strengths and weaknesses of the firms comprising these sectors and established a series of service centres to provide strategic assistance to the firms and the industrial districts of which they are a part. Some of these centres are engaged exclusively in research, training and technology transfer, and structured along cooperative lines.

The pre-existence of political alliances between the co-operative movement, the small artisan firms and the trade unions, along with the extensive co-operative economy already operating on the ground, meant that an entirely new form of co-operative economy could be fostered. It was a system that seemed to draw on the best attributes of co-operation on the one hand and co-operation on the other. Co-operation enabled small firms to take on large contracts and through networking achieve economies of scale and scope that were ordinarily only available to large corporations. In many cases satellite firms were spin-offs established by former employees of a lead firm. The co-operative element embodied in the cluster model was a natural extension of pre-existing social relations in the existing community.

Unlike the positional competition of Anglo-Saxon capitalism where the object of competition is to drive one's opponent out of the market or to ruin them, competition in the industrial districts focuses on product and performance excellence. The logic of this competition is to raise the standard of economic performance not only at the level of the firm, but of the industrial district as a production system and of the region as a whole. We now turn to social co-ops.


Social care, in the wake of privatization, for Restakis, is being commodified. The de-socializing dynamics of the Industrial Revolution that were, at least in theory, contained within the market economy, have now reached deep into the public systems that were once the preserve of the state. The colonization of the public domain by commercial interests in the late 20th century is in some ways analogous to the enclosure of the commons in the 18th century. Will civil society then find the means to reclaim the social and collective foundations of the public systems that are being abandoned by government and annexed by capital? Can social care be humanized?

Programmes like basic social security, health care and worker compensation were originally designed to provide a basic standard of care for large classes of people. It was an era marked by a mechanistic industrial paradigm, an age of assembly line automation that paved the way for the service-based consumer society that has since come to replace it. With society awash in material goods, people now expect that social goods and services will also recognize and respond to them as individuals. What has eventually arisen is a twin movement. A push for more pluralistic and private models of care on the one hand – a continuation of free market logic – and a contrary movement toward non-commercial, social economy solutions on the other. The rise of the social co-ops, and other forms of social enterprise, has gained considerable attention since the glow of privatized care lost some of its original lustre. The rise of social enterprise as a new, hybrid form of social care has been met with growing interest. In the co-operative sector, the emergence of social co-ops has been the most significant change to occur in the movement for 30 years.



The term "civil society", as we saw in the previous three chapters, has now entered, or more accurately re-entered, the vocabulary of common political discourse. It is a very ancient idea with roots in the political and moral philosophy of the ancient Greeks and the democratic society in which it was first conceived. The stress on the moral life which was a central part of Greek philosophy was always bound up in the concept of civic duty and the pursuit of the just society. Aristotle, in turn, held out that the "polis" from which our integral polity has borrowed – the city state – was an "association of associations" and the social reality that made political life possible.

In its broadest and most accepted sense, then, civil society is the social impulse to engage in free and democratic association, to create community and engage in the operations of social life, which include politics. This is the sense of civil society used by those like Vaclav Havel and Manuel Castells. Unlike in ancient times, however, civil society is now distinct from the workings of the state as well as from the operations of the private sector. For Havel and a long line of writers extending back to Aristotle, civil society remains the elementary fact of human existence. Alexis de Tocqueville, visiting America in the 1830s, famously attributed the vitality of the young democracy to the richness and diversity of its associational life.

Within civil society, a huge proportion of civic activities are carried out by organizations created to provide goods and services through collaboration, by people acting together to realize mutual interests. This economic aspect within civil society has been described as the third sector or the social economy. For both civil society and the social economy, the notion of reciprocity is fundamental. It is also essential for understanding the means by which a new view of social care, a civil view, might be developed as a more humane alternative to current systems.


The concept of social economy (8), like the term "civil society", has only recently come back into prominence after a long period of neglect. Originally social economy referred to the theoretical approach first adopted by the utopian socialists, especially the early founders of the co-operative tradition – Owen, Fourier, Saint Simon and Proudhon. Their primary purpose was the promotion of collective benefit. Their social product was not just the particular goods or services that they produce, but human solidarity – the predisposition of people in a society to work together around mutual goals.

We now turn, finally in our Northern integral case, to the very Slovenia that lay at the heart of the self-management movement in Yugoslavia.

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