--- title: Mondragon Corporation – a federation of co-operatives description: Mondragon Corporation is a federation of worker cooperatives based in the Basque region of Spain, founded in 1956 by Father José María Arizmendiarrieta. It... canonical: https://daily.dev/posts/mondragon-corporation-a-federation-of-co-operatives-zw6tjqs5q twitter:card: summary_large_image twitter:site: @dailydotdev og:type: website og:site_name: daily.dev og:title: Mondragon Corporation – a federation of co-operatives | daily.dev og:description: Mondragon Corporation is a federation of worker cooperatives based in the Basque region of Spain, founded in 1956 by Father José María Arizmendiarrieta. It... og:url: https://daily.dev/posts/mondragon-corporation-a-federation-of-co-operatives-zw6tjqs5q og:image: https://api.daily.dev/og/posts/zW6tjQS5Q.png og:image:alt: Mondragon Corporation – a federation of co-operatives og:image:width: 1200 og:image:height: 630 og:locale: en --- > ## Documentation Index > Fetch the complete documentation index at: https://daily.dev/llms.txt > Use this file to discover all available pages before exploring further. # Mondragon Corporation – a federation of co-operatives **[Hacker News](https://daily.dev/sources/hn)** · 24 min read · 0 upvotes · 0 comments ## Summary Mondragon Corporation is a federation of worker cooperatives based in the Basque region of Spain, founded in 1956 by Father José María Arizmendiarrieta. It operates across four sectors: finance, industry, retail, and knowledge, employing over 70,000 workers as of 2024. The corporation is guided by 10 cooperative principles including democratic organization, participatory management, and wage solidarity — with executive-to-minimum-wage ratios capped between 3:1 and 9:1. Key historical milestones include the 1969 founding of Eroski, international expansion to 122 subsidiaries by 2013, the 2013 bankruptcy of Fagor Electrodomésticos, and the 2022 departure of ULMA and Orona cooperatives. Critics note a growing two-tier system between worker-owners and non-owner employees, while supporters cite it as a viable alternative to traditional capitalist enterprise structures. ## Full article daily.dev links to this article rather than hosting it. Read it at the original source: ## Community take How the wider developer community reacted, aggregated from 7 discussions and 589 comments across hackernews (as of 2026-07-28). **TL;DR:** The community is broadly engaged with the merits and limits of worker cooperatives like Mondragon, debating whether market pressures inevitably force co-ops to behave like capitalist firms, and what realistic alternatives to profit-driven systems might look like. Discussion is substantive but inconclusive, with no consensus on solutions. **Sentiment:** 30% positive · 50% mixed · 20% skeptical **The case for** - Worker cooperatives like Mondragon demonstrate that compressed wage ratios (e.g., 5:1 exec-to-worker) and democratic governance are practically achievable at scale. - Commenters note that co-ops can attract talent and reduce Peter Principle-style dysfunction by not financially punishing workers for staying in roles they excel at. - Some argue that incremental steps—making it easier to start worker co-ops, redirecting corporate welfare subsidies—represent realistic improvements over the status quo. - Open-source and decentralized technology are cited as practical tools for redistributing economic power without requiring top-down central management. **The pushback** - Commenters argue that market competition forces co-ops to adopt exploitative practices to survive, regardless of their internal governance ideals. - Free markets tend toward consolidation and economies of scale, making small worker-owned co-ops structurally unstable over time. - Libertarian socialist and anarchist alternatives are criticized as untested at scale and likely to devolve into top-down collectivism in practice. - The profit motive embedded in capital markets means even well-intentioned co-ops face pressure to externalize costs onto workers or communities abroad. **By community** - hackernews (mixed): Hacker News commenters engage seriously with Mondragon and worker co-op economics, debating Chomsky's critique of market systems, the inevitability of profit motives, and the feasibility of alternatives, with no clear consensus but genuine intellectual depth. **Hottest debate:** Whether market systems inherently compel even worker-owned cooperatives to exploit labor and externalize costs, or whether the profit motive (distinct from markets per se) is the real culprit. **Open questions** - Is there a stable, scalable alternative to profit-driven market systems that doesn't require top-down central management? - What wage ratio optimally attracts top management talent while remaining perceived as fair by lower-paid workers? - Can decentralized technology (crypto, mesh networks, open source) realistically shift economic power without replicating existing hierarchies? - How would a society of worker co-ops prevent consolidation and the emergence of dominant firms over time? **Highlights** > Profit is what's left over after all costs are taken out from the price, including labour costs. Profit, by definition, is what the capitalist gets to keep for having done nothing but owning the capital that was used to generate the profit. So like when Bezos makes $4M+ per hour, it's not a wage because he is not working for it, he could be sleeping or shitting and he would make the same money. He gets that just because it's his name on all of the capital that generates this profit. The actual work is being done by the many people working for amazon, peeing in bottles in fulfillment centres because of lack of breaks and whatnot. They get paid very little, so there are low costs, so there is great profit to line Bezos' pockets. Since co-ops like Mondragon need to compete with companies that are run like Bezos' in order to survive, they are under pressure to do similar things in their management structure, even though they want to share all "profit" with all workers, since all workers are owners (which is why it's not really "profit" for co-ops, since there are no non-working capitalists that earn it). Therefore, it is the profit motive, rather than the market system, which forces co-ops to act in ways that are inconsistent with their mission statements (worker control, fair pay, etc.) > — [kiliantics on hackernews · 2 comments](https://news.ycombinator.com/item?id=22290689) > The interesting thing about this wage ratio is they had to increase it in the beginning of the cooperative because very few people were willing to take more responsibility for little more pay. So maybe there is a study to be done about what could be the optimum wage ratio that allows a company to attract top talent for management positions and at the same time is not perceived as injust and exploitative by the lower workers. > — [bprieto on hackernews · 2 comments](https://news.ycombinator.com/item?id=22288147) > This quote without context might give impression that Chomsky is critical of Mondragon. A bit of context around it helps to understand his point. From [1]: “LF: So it sounds as if you might support something like the Cleveland model where the ownership of the company is actually held by members of the community as well as the workers… NC: That’s a step forward but you also have to get beyond that to dismantle the system of production for profit rather than production for use. That means dismantling at least large parts of market systems. <> Markets also have a very bad psychological effect. They drive people to a conception of themselves and society in which you’re only after your own good, not the good of others and that’s extremely harmful. LF: Have you ever had a taste of a non market system — had a flash of optimism –– oh this is how we could live? NC: A functioning family for example, and there are bigger groups, cooperatives are a case in point. It certainly can be done. The biggest I know is Mondragon but there are many in between and a lot more could be done.” 1 - https://www.counterpunch.org/2012/04/30/talking-with-chomsky... > — [mcprwklzpq on hackernews](https://news.ycombinator.com/item?id=22291861) > I know Chomsky. I went to meet him in MIT several years ago, when I was looking for advisors to Qbix. (Also met Tim Berners-Lee and his team at what was then known as Solid - a similar project to Qbix). The guy responds to email at 2am btw, quite cool for an 85 year old. As I see it, open source technology IS the great decentralized of power. We just need people to build Good open source software. My personal passion (which I poured a lot of money into) was qbix.com and intercoin.org . That’s also why I reached out to Andrew Yang back in early 2018 when he announced running and met him in May 2018. We agreed my company would build https://yang2020.app to support his campaign, and he would help introduce us to mayors of cities that want UBI locally (he knew a few dozen, like Michael Tubbs of Stockton, although since then Michael has not been a fan of Yang’s approach for various reasons). I believe in UBI + Gift Economies / Collaboration as the best system, better than socialism or capitalism. But we have a while to get there. Yang is trying to boil the ocean by going for UBI on a national level. I believe the future is in decentralization, and I talk about it extensively. I think UBI can be done via cryptocurrency on a local level. We can also do voting this way. I’m writing a piece about this at the moment, very apropos of the recent fiascos. Printers, Email, Blogs, the Internet have replaced large corporate and state gatekeepers we used to have (newspapers, cable channels, telephone companies, printing presses etc) and costs went down to near zero. Technology decentralizes power. We can have towns and cities run decentralized: Solar power networks (resilient to EMPs and carrington events) Mesh networks (better than cellphone networks) Social networks (chat, events, appointments, everything that fb does but w local servers) I’m trying to build the software to run on these networks (https://m.youtube.com/watch?v=pZ1O_gmPneI) PS: sorry for all the links but honestly I am passionate about this stuff and need to illustrate it instead of talking. A video is worth a thousand words. To mitigate the shilling I will say that TimBL’s solid and MaidSAFE * IPFS and others are also working on decentralizing power > — [EGreg on hackernews · 1 comments](https://news.ycombinator.com/item?id=22290813) > Chomsky is anti-centralization, he is an anarchist (anarcho-syndicalist). In general, his ideal end-goal world would include smaller states with more direct control by the populace, with worker-owned and worker-managed corporations, with free markets of goods and services between different corporations and different states, and of course freedom of movement. Strong environmental control would be almost implied if the people doing an economic activity were in charge of decisions and were also directly impacted by the effects of those decisions. Localizing and letting corporations be small would also put a natural cap on inequality, though democratically run states could impose additional safeguards where needed (minimum wages, estate taxes, non-discrimination clauses etc.) > — [tsimionescu on hackernews · 5 comments](https://news.ycombinator.com/item?id=22289782) **Source threads** - [hackernews](https://news.ycombinator.com/item?id=49082695) · 61 points · 23 comments - [hackernews](https://news.ycombinator.com/item?id=22287794) · 442 points · 566 comments - [hackernews](https://news.ycombinator.com/item?id=46445272) · 4 points · 0 comments - [hackernews](https://news.ycombinator.com/item?id=20754858) · 4 points · 0 comments - [hackernews](https://news.ycombinator.com/item?id=27446504) · 3 points · 0 comments - [hackernews](https://news.ycombinator.com/item?id=31170798) · 2 points · 0 comments - [hackernews](https://news.ycombinator.com/item?id=27066150) · 2 points · 0 comments ## Similar posts on daily.dev - [Union claims Nacon's decision to shutter Spiders was a "premeditated and deliberate choice"](https://daily.dev/posts/union-claims-nacon-s-decision-to-shutter-spiders-was-a-premeditated-and-deliberate-choice--gymdaia4u) · GamesIndustry.biz · 0 upvotes · 0 comments - [Google DeepMind alumni are building tools to accelerate fusion power for the grid](https://daily.dev/posts/google-deepmind-alumni-are-building-tools-to-accelerate-fusion-power-for-the-grid-0l4m2unju) · TechCrunch · 0 upvotes · 0 comments - [Documenting the tech worker movement](https://daily.dev/posts/documenting-the-tech-worker-movement-uyp7ykxvy) · MIT News · 0 upvotes · 0 comments - [Alva Industries raises €16M to scale its ultra-compact electric motors](https://daily.dev/posts/alva-industries-raises-16m-to-scale-its-ultra-compact-electric-motors-trgrml0ca) · The Next Web · 0 upvotes · 0 comments --- [View this post on daily.dev](https://daily.dev/posts/mondragon-corporation-a-federation-of-co-operatives-zw6tjqs5q) ```json {"@context":"https://schema.org","@graph":[{"@type":"Organization","@id":"https://daily.dev/#organization","name":"daily.dev","url":"https://daily.dev","logo":{"@type":"ImageObject","url":"https://daily.dev/apple-touch-icon.png","width":180,"height":180},"sameAs":["https://twitter.com/dailydotdev","https://github.com/dailydotdev","https://www.linkedin.com/company/daily-dev-ltd"]},{"@type":"WebSite","@id":"https://daily.dev/#website","url":"https://daily.dev","name":"daily.dev","publisher":{"@id":"https://daily.dev/#organization"},"potentialAction":{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https://daily.dev/search?q={search_term_string}"},"query-input":"required name=search_term_string"}}]} {"@context":"https://schema.org","@type":"TechArticle","headline":"Mondragon Corporation – a federation of co-operatives","url":"https://daily.dev/posts/mondragon-corporation-a-federation-of-co-operatives-zw6tjqs5q","mainEntityOfPage":{"@type":"WebPage","@id":"https://daily.dev/posts/mondragon-corporation-a-federation-of-co-operatives-zw6tjqs5q"},"datePublished":"2026-07-28T13:32:52.456Z","dateModified":"2026-07-28T15:53:33.184Z","description":"Mondragon Corporation is a federation of worker cooperatives based in the Basque region of Spain, founded in 1956 by Father José María Arizmendiarrieta. 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