Photo: Courtesy International Labour Organization

Several places around the world have begun to use cooperative business development as a strategy to serve incarcerated and returning citizens. Major examples come from Puerto Rico, Ethiopia, Italy, Sweden, and Canada, and can be seen in many different industries, including craft production, catering, construction, bicycle manufacturing, and more.1 In these situations, prisoners not only earn more money in prison, they build skills that help keep themselves out of prison after release. Could a similar approach in the US mainland similarly help reduce what are currently sky-high recidivism rates?

Benefits and Impacts of Cooperatives

I have written widely about the benefits of co-ops to communities.2 We know that co-ops have longer survival rates than traditional small businesses; they anchor and recirculate resources in the local economy; and they provide education and training, including general business skills, industry specific skills, and social capital skills—such as team work and leadership development.3

Co-ops address market failures: they create jobs and meaningful work; provide affordable, quality goods and services; and are economically and environmentally sustainable. They build wealth by pooling resources, sharing risks and profits, and enabling the accumulation of assets. Co-ops promote democratic economic participation and democratic governance; transparency; and civic engagement.

In addition, cooperatives foster reciprocal and trust relationships4 that generate more efficient economic exchanges, values-based exchanges that prioritize community, and positive externalities, such as social benefits to members, their families, and communities.5 Co-ops are good neighbors and community assets. Moreover, cooperatives both successfully address the effects of crises and survive crises better than other types of enterprises.6

In worker cooperatives, the relationship between the worker and the firm is of membership,7 rather than the employment contract. Workers participate in decisions about their working conditions and are motivated to succeed.8 Many worker-owned cooperatives, in particular, increase industry standards in wages and benefits, as well as provide opportunities for skill development, capacity building, and job security.9

Student-owners of cooperative businesses learn math, research, communication, and business skills on-the-job. Cooperative ownership and democratic governance also train them to apply problem solving, teamwork, and facilitation skills for the rest of their lives.10

These benefits are especially significant and helpful to marginalized people and their communities. All of these benefits do and could aid incarcerated and returning citizens to develop new expertise and capacities—industry-specific skills, as well as social capital and trust— and help them successfully transition back into society. Below I present some preliminary data on two cases—Cooperativa ARIGOS in Puerto Rico, and a system of 31 co-ops at Mekelle Prison in Ethiopia.

Cooperativa ARIGOS, Puerto Rico

My initial research of the prison co-ops in Puerto Rico uncovered a bottom-up approach and transformative growth among the co-op members.11 It was the incarcerated citizens themselves who demanded co-op business education and the right to own their own co-ops. They petitioned for a change in commonwealth law and then founded Cooperativa ARIGOS. Creating their own dignified work, controlling their own businesses together with other inmates, and earning enough money to help support their families, made a huge difference in every aspect of their lives—including commuted sentences and very low recidivism.

The Puerto Rican League of Cooperatives (Liga de Cooperativas de Puerto Rico) works with the Corrections Department to establish worker/producer cooperatives among incarcerated people in their facilities. They supported incarcerated people in changing Puerto Rico’s co-op law to allow incarcerated people to own their own co-ops and provide co-op education to incarcerated worker-owners. Four worker co-ops currently exist in Puerto Rican prisons—art, solar, and technology co-ops in men’s prisons, and a sewing co-op in a women’s prison—and a fifth is in development.

Cooperativa de Servicios ARIGOS in Guayama Penitentiary began with art therapy. As the incarcerated men became more focused on their art and began thinking about a business model for selling their art, they learned about the co-op business ownership model and demanded co-op education. They found that Puerto Rican co-op law did not allow incarcerated people to be members or directors of a co-op. They started talking to people about how to change the law. This led to a meeting with the then-governor of Puerto Rico, Sila María Calderón, and lobbying the State Assembly to change the law. They succeeded, and the law was changed. They incorporated as a cooperative owned entirely by incarcerated men.

The co-op soon signed a memorandum of understanding with the Department of Corrections for the use of office space, electricity, computers, etc., in exchange for a 15-percent share of their profits, and to pay extra for security, especially when traveling to events to sell their wares. They retain 10 percent of profits to use to sustain the business, and 75 percent of profits go to the incarcerated worker-owners.

Over time, the co-op established strict standards for who could represent the co-op when out at sales events. They also rephrased the international co-op principles to better reflect the experiences of incarcerated people. Over the first 10 years, there have been only two cases of recidivism among the over 50 co-op members who were released (and one of them is already back out on parole).

Mekelle Prison, Ethiopia

The prison