Lesson In Economics From Hawkers Rebellion

 Imagine a kopitiam with famous hawker food. But the boss keeps raising stall rent.
One day, the hawkers decided - enough is enough. Most of them moved out to a nearby kopitiam charging lower rent.
This “hawkers rebellion” happened on April 18 with a mass exodus of stalls from the famous Genting Cafe in Island Glades, Penang to a nearby kopitiam, renamed First Genting. Business is booming.
The original owner learned a costly lesson - that his true asset was not his shop but the hard-working hawkers.
This is an example of the working class taking control of their situation from exploitative owners. The only thing missing were Che Guevara T-shirts.
It’s happening elsewhere. Young people who want to break free from the corporate grind pool their money and energy to establish cafes. Or tech start-ups.
Diners at the First Genting kopitiamMechanics, hairdressers, engineers, and lawyers set up their own shop after gaining some experience. Or at least, become partners with profit sharing.
Worker-owners who control their businesses are now even more relevant as artificial intelligence (AI) threatens to destroy many jobs.
For example, if AI makes workers doubly productive, two things can happen, explains Richard D Wolff, an American emeritus professor of economics, who runs the Democracy At Work show on YouTube.
The boss may think, “Hey, I can now afford to fire half the workers and still make the same profits.” But what if workers share decision-making in the company?
Then they can say nobody gets fired. Instead, the same workers now need to work only half a day and still maintain their pay, says Wolff.
The point is workers can control their fate, not an uncaring boss who only wants a new yacht and mistress.
Here’s the basic question: are businesses meant only to maximise investors’ profits? What about workers’ well-being?
Take the shutting down of the Goodyear tyre factory in Shah Alam after 52 years, which resulted in the loss of 550 jobs. Rather than giving excuses, can’t the Madani government instead loan money to the workers to buy over the factory?
After all, they already know how to run the place. So why not create a cooperative where workers are also part-owners?
This is not as strange as it sounds. The original Felda farmers were the prime example of owner-workers. To buy land, they were given government loans, which were paid off gradually from harvest profits.
In the end, they became owners of their land. It was a successful socialist model of giving “land to the landless”. And because of this, Felda settlers became a “fixed deposit” of support for Umno.
Felda Gunung Besout housing schemeSadly, several dodgy deals when Umno politician Mohd Isa Abdul Samad was in charge led to huge losses. Yet more Umno politicians took Isa’s place.
Felda continued to bleed with losses of RM1 billion in 2022. Is that why Malay Felda settlers are shifting support towards PAS and Bersatu?
Workers sharing decisions
As for the Goodyear factory, we need to learn from what happened in the United States where capitalism has run amok. When bosses decided to relocate factories wholesale to China or Mexico, many American towns were devastated.
Businesses closed down, and tax revenues and public services declined. Despair rose amid joblessness.
But if workers had a say, they could reject offshoring of jobs with alternatives, such as pay cuts for all, including top managers.
American chief executives make well over 300 times what the typical worker brings home in pay. Yet in 1965, corporate managers earned only 20 times what the typical worker did.
This huge pay gap amid job losses led many voters to support Donald Trump, who declared, “The system is rigged.”
In 2018, two US Senators proposed that workers get a minimum number of corporate board seats. Senator Elizabeth Warren said companies should not be accountable only to shareholders. They should also answer to employees and the communities where they operate. She calls this “accountable capitalism”.
This follows the German model of co-determination where workers at large companies elect up to half of the supervisory boards making high-level decisions, like how to invest profits and hire senior managers.
Arguably, managers and workers themselves often know best how to solve company problems. That sure beats bosses bringing in clueless external “consultants” whose main job is often to provide an excuse to fire more staff.
Worker co-ops
Spain has the best-known worker-owned co-ops called Mondragon. Members themselves, be they senior management or blue-collar, have equal votes on strategy, salaries, and policy.
The highest-paid executive makes at most six times more than its lowest-paid employee.
Mondragon co-op’s Eroski supermarket chainWhen the co-ops do well, members share in the profits. But during the Covid-19 pandemic, Mondragon co-op workers voted to temporarily reduce their own salaries or hours until markets recovered.
This is not about some hippies selling handicrafts. Some 95 co-ops in the Mondragon network run factories, schools, the large Eroski supermarket chain, a bank, and its own pension scheme.
In 2021, the network employed around 80,000 people and garnered over €11 billion in revenue.
Their purpose is not to create rich people but rich societies. The priority is on worker-owners rather than external investors.
Another successful model of worker-owner co-ops is in the region around Italy’s Bologna city, the home of spaghetti bolognese. Here, 4,000 co-ops employ 250,000 people.
There are three million co-op members (from a population of five million). People typically shop at co-ops, bank with co-ops, and receive health and social care from co-ops too.
Madani economy?
In Malaysia, the government claimed in 2023 that we have almost 15,000 co-ops with a combined income of RM22.4 billion and assets of RM156 billion.
But why have our co-ops done poorly compared to those in Spain and Italy? The Consumers’ Association of Penang pointed out that our co-ops have had a “scandalous history” of mismanagement and fraud. Many are dormant.
Nevertheless, workplace democracy and worker co-ownership should be re-examined seriously in Malaysia, especially with the challenge from lower-wage countries. Can motivated worker-owners give us an edge in quality?
Such reforms will be far more useful to ordinary workers (especially Malays) than insisting on a 30 percent bumiputera quota which benefits mainly well-connected elites.
Perhaps the most successful social business group we have had was linked to the outlawed Al-Arqam sect, since renamed Global Ikhwan Holdings. In 2022, it had 38 shopping marts, 63 bakeries, and 120 restaurants in 17 countries.
The company’s chief executive Lokman Hakim Pfordten told FMT that Malays should be self-reliant and ”not think about what the government should do for them”.
Arguably, democracy should mean more than voting once every five years to choose “the lesser of two evils”. Real democracy should happen in the workplace where people spend most of their lives!
After all, Prime Minister Anwar Ibrahim declared that Islam and Madani values are all about a “humane economy”.
“An economy that places the people at its centre that contributes to developing a caring, compassionate society, supporting comprehensive social safety nets, investing in community development, and abolishing poverty and inequality,” said Anwar in February.
I hope this was not just another fancy speech from our premier. I hope he has some solid plans to achieve his vision.
Perhaps he can learn from the hawkers’ rebellion at Penang’s Genting Cafe. - Mkini
ANDREW SIA is a veteran journalist who likes teh tarik khau kurang manis. You are welcome to give him ideas to brew at [email protected].
The views expressed here are those of the author/contributor and do not necessarily represent the views of MMKtT.

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