Rethinking Cooperatives in the 21st Century (1)

In the middle of a grand village feast, one man had quietly taken charge of the serving spoons. Every time a dish was passed around, he made sure his own plate overflowed, leaving everyone else with a spoonful of air and disappointment. When people protested, he shrugged and said, “That’s just how the market works—first come, first served.” The villagers grumbled but went along, until a group of them decided to set up a new table at the other end of the hall. This table was run cooperatively: everyone contributed food, and everyone received a fair portion. Soon, laughter and full bellies filled that side of the room, while the greedy man sat sulking with his mountain of cold leftovers. An old farmer patted him on the shoulder and said, “You see, friend, sometimes the best way to fix a broken market is simply to throw a better party.”

Michael Goodwin answers the question of “How Our Economy Works (and Doesn’t Work)” in his book Economix (2012, Abrams ComicArts). He frames the book explicitly as a story of economics for ordinary people, written in the style of a graphic novel, precisely so readers can see not only the theories but also the messy realities of how they play out. Goodwin guides readers through the origins of economic thought, from Adam Smith’s concept of the invisible hand to Marx’s critiques, Keynes’s policies, and the emergence of neoliberalism. Along the way, he contrasts what economic theory claims to deliver with what actually happens in society—boom and bust cycles, inequality, monopolies, and environmental costs.

By doing this, Goodwin essentially argues that while economic theories often promise efficiency, prosperity, and balance, the real-world economy doesn’t always live up to these ideals because of politics, greed, and systemic flaws. The subtitle of the book—“How Our Economy Works (and Doesn’t Work), in Words and Pictures”—is not just marketing but also a methodological commitment: he shows both the functional aspects of capitalism (its ability to generate wealth, innovation, and productivity) and its dysfunctions (its tendency toward exploitation, instability, and crisis).

Goodwin’s answer shows that the economy “works” in the sense that it organises production and trade in ways that sustain human life and drive progress, but it “doesn’t work” in the sense that it often fails to deliver fairness, stability, or sustainability without conscious intervention.

How the economy works, according to Goodwin, is that it begins with a simple truth: people have needs, and by working together through systems of trade, money, and production, those needs can be met more efficiently than if everyone tried to survive alone. Classical thinkers like Adam Smith believed that self-interest, channelled through markets, creates an “invisible hand” that guides resources to where they are most needed. Over time, this system generates growth, innovation, and prosperity that can lift entire societies. When governments act wisely—regulating excess, investing in infrastructure, and redistributing wealth fairly—the economic machine works as a stabiliser, helping ordinary people share in the benefits of collective progress.

How the economy does not work, in Goodwin’s telling, is when theory collides with messy reality. Smith’s invisible hand does not always deliver fairness; instead, it often magnifies greed, creating monopolies, inequality, and recurring crises. Capitalism, left unchecked, tends to concentrate wealth and power, leaving the majority with shrinking slices of the pie. Goodwin shows how depressions, recessions, and bubbles reveal that markets alone cannot guarantee stability or justice. Moreover, governments frequently side with elites, propping up financial interests while neglecting the working majority. Thus, the economy fails not because people stop needing things, but because the system serving those needs bends toward privilege rather than the common good.

In Goodwin’s spirit, the economy can be compared to a communal feast. When it works, everyone brings something to the table, and the dishes are shared in a way that leaves most people satisfied. Farmers provide the rice, workers cook the dishes, and merchants make sure the flavours reach faraway guests. Money acts like the plate and cutlery, giving shape and order to the sharing. If the host—symbolising the government—organises things fairly, making sure no one hoards all the meat or steals from the stew, the feast becomes a celebration of abundance. In this way, the economy works when it distributes the fruits of human effort widely, balancing self-interest with collective well-being.

But when it does not work, the feast turns sour. A few greedy guests seize the best dishes, piling their plates high while others are left with scraps. The host might look the other way—or worse, secretly serve the richest guests extra portions from the kitchen. Soon the table no longer feels like a feast but like a contest of survival. Arguments break out, trust evaporates, and some leave the table hungry despite there being enough food in the room. This is Goodwin’s point: the economy fails not because it cannot produce plenty, but because the systems of sharing bend toward privilege and undermine fairness.

In Goodwin’s account, the Great Depression of 1929 was like the moment when the grand communal feast suddenly plunged into darkness. For years before, the party had been getting louder, with music swelling and plates piled high. Speculators—those reckless guests—had been grabbing food on credit, filling their plates with more than they could ever eat, betting that more dishes would keep arriving. But when the lights went out, it became clear that much of the food had been promised but never cooked. Panic spread, guests scrambled, and even those who had been careful found their plates empty. The feast, which had seemed endless, revealed itself as fragile and unfair, and millions went hungry in the literal sense as economies collapsed worldwide.

What made the feast recover, at least for a time, was the host’s intervention. In the United States, Franklin D. Roosevelt stepped in with the New Deal, taking on the role of a stricter but fairer organiser. He made sure some of the hoarded food was redistributed, he ordered new dishes to be prepared through public works, and he demanded that greedy guests play by new rules. For a while, the feast regained its rhythm—proof that the economy can be saved from collapse when governments remember their role is to serve the whole table, not just the richest diners.

In Goodwin’s telling, the financial crisis of 2008 was like a feast where the table itself collapsed. For years, guests had been stacking plates higher and higher with dishes they didn’t fully understand—exotic meals with fancy names like “mortgage-backed securities.” These were like food that looked delicious but was cooked from spoiled ingredients. Bankers and financiers, the most confident guests, kept passing these dishes around, assuring everyone that they were safe to eat. But when the first few guests began to fall ill, panic erupted. Suddenly, the whole table gave way, revealing that much of the apparent abundance was nothing but fragile scaffolding propped up by debt and illusion. The feast didn’t just go dark, as in 1929—it physically broke apart, leaving everyone scrambling for survival.

What followed was a rescue that felt less like fairness and more like triage for the richest diners. Governments rushed in, but instead of redistributing food or building new kitchens for the hungry, they bailed out the very guests who had collapsed the table in the first place. The bankers got fresh plates and a second chance, while millions of ordinary people lost jobs, homes, and security. For Goodwin, this was a sign that the economy, left in the hands of elites, can repeat its failures—because when the table breaks, the ones who need help most are often the last to be served.

In Goodwin’s lens, cooperatives can be seen as a conscious correction to the failures of the market economy. If capitalism often channels wealth upward, rewarding speculation and monopoly, cooperatives redirect the flow by placing ownership and decision-making directly in the hands of workers or consumers. They embody the idea that the feast of the economy should not be controlled by a few greedy diners, but rather shared fairly among all who contributed. In Economix, Goodwin repeatedly stresses that markets alone cannot guarantee justice; institutions like cooperatives represent a structural way to build fairness into the system itself, ensuring that value created collectively is also enjoyed. Instead of profit maximisation at any cost, cooperatives prioritise stability, community benefit, and the dignity of participation.

At the same time, Goodwin would likely note that cooperatives struggle within the larger capitalist table. They are often pressured by competition, undercut by giant corporations, or absorbed into the very system they were meant to challenge. In this way, cooperatives illustrate both a hope and a limitation: they prove that economies can work differently when ownership is democratised, but they also reveal how hard it is to sustain fairness when the surrounding rules are tilted toward privilege. In short, for Goodwin, cooperatives represent glimpses of how the economy can work for people, but they also show why systemic reform is needed for such models to thrive.

Michael Goodwin’s Economix offers readers a lively and visual journey through the evolution of economic thought, showing not only how economies are supposed to function in theory but also how they often collapse under the weight of greed, inequality, and political manipulation. Yet, while Goodwin introduces these complexities in a cartoonish but deeply insightful way, the conversation inevitably shifts towards deeper philosophical debates: what should society do when the market’s promises fail? It is at this point that Scott R. Sehon’s Socialism: A Logical Introduction becomes a natural companion, for it does not merely critique capitalism’s shortcomings but also lays out the moral and rational case for socialism as a viable alternative. Where Economix draws the map of the economic landscape, Sehon’s work asks whether the road we are travelling is the right one at all.

Scott R. Sehon’s Socialism: A Logical Introduction is a work of political philosophy that attempts to bring clarity to one of the most contested ideas in modern history. Rather than treating socialism as a mere slogan or a relic of the twentieth century, Sehon examines it as a serious moral and logical proposal, asking whether it can genuinely promote human well-being while respecting individual rights. He argues that many common criticisms of socialism—such as claims that it stifles innovation, undermines freedom, or inevitably leads to authoritarianism—often rest on shaky assumptions or incomplete reasoning. At the same time, he acknowledges the strengths of capitalism, particularly its ability to generate growth, but he insists that growth without justice is ultimately hollow. His central claim is that a democratic form of socialism, grounded in equality and collective participation, offers a more compelling vision for the future than the unchecked forces of global capitalism. In doing so, Sehon does not romanticise the failures of past socialist experiments, but instead invites readers to imagine how socialism might be reinvented as a fairer and more humane alternative in the twenty-first century.

When Scott R. Sehon argues that socialism should be reimagined as a democratic and humane alternative, his perspective resonates strongly with Mohammad Hatta’s vision of cooperatives in Indonesia. Hatta never sought to impose a rigid or authoritarian form of socialism, nor did he embrace the ruthless competitiveness of capitalism. Instead, he envisaged cooperatives as a practical embodiment of democratic socialism, where people could collectively own and manage resources while retaining their individual dignity and freedom. Sehon’s insistence that growth without justice is meaningless echoes Hatta’s conviction that economic progress must serve the people rather than a narrow elite. In this sense, cooperatives can be read as Indonesia’s own experiment in grounding socialist ideals within a cultural and communal framework, offering a path where solidarity and equality are balanced with initiative and responsibility. By revisiting Sehon’s arguments today, Indonesians might rediscover in Hatta’s cooperative model not merely a nostalgic legacy, but a viable structure for resisting the excesses of global capitalism while remaining true to democratic values.

Socialism and cooperatives share a natural affinity, as both are grounded in the idea that wealth and resources should be organised in a manner that benefits the collective rather than being concentrated in the hands of a few. While socialism as a political and economic system often seeks to restructure society through state intervention or public ownership, cooperatives represent a more grassroots and voluntary manifestation of the same ideals. In a cooperative, members jointly own and democratically manage enterprises, ensuring that profits are not extracted solely for private gain but are reinvested for the mutual benefit of all. This creates a balance between economic participation and social responsibility, echoing socialism’s concern with equality and justice, yet often achieved without the heavy hand of centralised authority.

The historical link between socialism and cooperatives can be traced back to nineteenth-century Europe, when industrial capitalism created deep inequalities and left working-class communities vulnerable to exploitation. Early socialist thinkers and activists saw cooperatives as a practical way to empower workers without necessarily waiting for full-scale political revolution. The Rochdale Pioneers in England, often regarded as the founders of the modern cooperative movement, embodied this spirit by establishing a shop in 1844 that sold affordable goods while being owned and managed by its members. Their model quickly spread across Europe and beyond, influencing socialist movements that admired the democratic and egalitarian principles at its core. While not all socialists agreed—some preferring state control to voluntary associations—cooperatives remained an enduring example of socialism in action at the community level, providing both economic relief and a vision of a fairer society.

Scott R. Sehon’s Socialism: A Logical Introduction arrives at a moment when the world is struggling with inequality, environmental crises, and the overreach of global capitalism. His central argument—that socialism must be reimagined not as a dogmatic ideology but as a democratic, humane alternative—offers an intellectual framework for societies searching for a balance between growth and justice. By dissecting the logical strengths and weaknesses of both socialism and capitalism, Sehon reminds us that economic systems cannot be judged merely by their capacity to generate wealth; they must also be assessed by their ability to distribute it fairly and to respect human dignity.

This insistence on justice as a measure of economic success resonates profoundly with Indonesia’s own intellectual history, particularly with the vision of Mohammad Hatta. Known as the “Father of Cooperatives,” Hatta sought to steer the Indonesian economy away from the exploitative tendencies of capitalism without falling into the authoritarian pitfalls of communism. For him, cooperatives represented not merely economic institutions but moral and cultural expressions of solidarity, mutual aid, and democratic participation. In essence, Hatta was attempting, decades earlier, what Sehon now articulates in philosophical form: to anchor socialism in democracy and human freedom rather than in compulsion and rigidity.

Sehon’s claim that growth without justice is hollow finds a direct echo in Hatta’s belief that economic progress must uplift the people rather than enrich the elite. In the Indonesian cooperative model, profits are not siphoned away to shareholders but are reinvested for the common good of members. This stands as a living example of what Sehon describes as the democratic potential of socialism, grounded not in utopian abstraction but in daily practice. Cooperatives thus embody a uniquely Indonesian experiment in making socialism tangible, where ideals of equality and solidarity coexist with initiative and responsibility.

The tragedy, of course, is that this vision has too often been diluted by bureaucratic interference and political manipulation. Under the New Order, cooperatives were frequently reduced to instruments of state control, stripped of their democratic vitality and turned into vehicles for distributing subsidies or legitimising authority. In this way, the socialist ideals that Hatta envisioned became entangled with authoritarian practices, illustrating Sehon’s warning that socialism loses its soul when it abandons freedom. Yet, despite these distortions, the cooperative idea remains deeply embedded in Indonesian society, waiting to be revitalised in more authentic forms.

 Indonesia’s founding parents, while influenced by socialist and democratic ideals, did not formally declare the nation as adopting Democratic Socialism in the strict sense. Instead, they articulated Pancasila as the state’s philosophical foundation, which contains elements that echo socialism and democracy but are moulded into a uniquely Indonesian form. Thus, it would be more precise to say that Indonesia’s ideology is Pancasila, not Democratic Socialism, even though Pancasila borrows heavily from both traditions.

Indonesian socialism, as envisaged by figures like Sukarno, was not Marxist or Leninist in its pure sense. It rejected class struggle as a destructive force and instead emphasised gotong royong—mutual cooperation—as the essence of economic and social life. The idea was that wealth and resources should not be monopolised by the few, but equally shared and managed for the welfare of all, while still respecting the cultural and religious fabric of society. It was a socialism of harmony rather than revolution, designed to suit a diverse archipelago rather than to mirror the industrial class conflicts of Europe.

Indonesian democracy, on the other hand, was shaped not as liberal democracy in the Western sense but as demokrasi musyawarah. The founding leaders stressed that decisions should emerge from deliberation and consensus, rather than from simple majority rule that could divide society. This form of democracy gave primacy to community values over individualism, and it placed strong emphasis on social justice and inclusivity. In short, Indonesian democracy was intended to avoid the tyranny of the majority while still upholding popular sovereignty through collective decision-making.

The blend of socialism and democracy within Pancasila was never meant to be dogmatic or rigid. Instead, it was pragmatic, allowing the Indonesian state to adapt to changing times without abandoning its cultural roots. It was an ideology of flexibility, grounded in unity, justice, and humanity.

So, Indonesian socialism and democracy cannot be neatly mapped onto Western categories. They are hybrid systems that carry echoes of international thought but are fundamentally rooted in local wisdom. They represent an attempt to craft a path of modernity that does not betray tradition, ensuring that Indonesia’s political and economic life reflects the values of cooperation, justice, and deliberation.

Today, as Indonesia faces the pressures of globalisation, digital capitalism, and widening inequality, Sehon’s philosophical defence of socialism provides a valuable lens through which to reconsider Hatta’s cooperative dream. The digital age, with its capacity for transparency, connectivity, and decentralised decision-making, could breathe new life into cooperatives, enabling them to compete with corporate giants while remaining true to their ethical foundation. If Indonesians embrace innovation while holding fast to the principles of solidarity and equality, cooperatives could re-emerge as a viable alternative to unrestrained capitalism, offering not nostalgia but a blueprint for the future.

The dialogue between Sehon and Hatta—one a contemporary philosopher from the West, the other a founding father of Indonesia—reveals that socialism’s fate need not be confined to failed revolutions or rigid dogmas. Instead, it can be reframed as a living project of democracy and justice, grounded in institutions like cooperatives that grow from the people themselves. Such a synthesis may not only revitalise Indonesia’s economic imagination but also contribute to the global search for a fairer, more humane way of organising society.

[Part 2]

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