"Here, We Slay Our Own Dragons"

Other towns pleaded for St. George to save them. In Mondragón, the people did it themselves.

I don’t usually get nervous before meetings, but this was an exception. For one thing, I had been planning for it for nearly three and a half years. 

The secretary announced my arrival, and out of the office came a tall, silver-haired man with sharp, pointed features and a navy business suit. We shook hands. 

“Good to meet you, Dean Beloki,” I said.

Within the world of Cooperatives, Dean Lander Beloki Mendizabal is something of a legend. He is the Dean of the Business School at Mondragon University and has been a leading voice in the global cooperative movement for the last 25 years. 

The University of Mondragon is a part of the Mondragon Corporation, the largest Cooperative business in the world. Located in the Basque Country – a semi-autonomous region in Northern Spain –  it employs over 85,000 people and is Spain’s 10th largest business. Between its four sectors: industry, retail, finance, and education, Mondragon has an annual revenue of more than 11 billion euros. 

Because it’s a co-op, each of the 85,000 employees is a partial owner of the company, meaning that they all collectively vote on decisions and elect corporate leadership. In 2008, when Mondragon was hit by the fallout of the economic crisis, the workers voted to take a collective pay cut rather than laying off a single peer. 

It was this impressive track record that made Mondragon one of the first places I incorporated into my Watson Fellowship proposal in the Fall of 2019. 

Mondragon selected by Forbes as one of the top ten companies to work for in the world.

Mondragon University itself is seen as a world class education in cooperative management and development. Dean Beloki has been there since the beginning, helping build the program from the ground up starting in 1997. 

Prior to my visit, he had just returned from a four-day trip to New York, where he had been meeting and advising on cooperative initiatives at CUNY and the United Nations. 

Today, I had traveled to him. The topic of discussion: How can we build better collaboration between cooperatives and community organizing? 

Over the course of our 90 minute conversation, it didn't take long for Dean Beloki and I to find a mutual interest. As he shared his observations about the future of the cooperative movement in the United States and abroad, I wanted to understand how that story could be told not just from an economic lens, but as a parable of people coming together to build power for their community. I wanted a story that could show co-ops as a viable tool for organizers. 

Likewise, as I shared stories about IAF victories around workforce development, taking on corporate tax-breaks, and solving local issues, he became curious to see how the story of Mondragon could be told from an organizing perspective. He wanted a story that could be used to teach why Mondragon has, and must always be, a vehicle for empowering people, not just a new form of making profit. 

So I asked if he would do something a little out of the ordinary at the end of our time together: would he work with me to craft a narrative that could be used to tell both of these stories? 

Dean Beloki paused in reflection, seated across the table from me in the large, clear-walled conference room. The best story to tell, he said, “is simply the creation of Mondragon instelf. And the first line of the story is very simple: People had nothing.” 

The Basque Country had fought General Franco’s takeover with everything it had, making it one of the last regions to fall to regime forces. As retribution when he won, Fanco turned the region into a police state, leaving the people “deeply impoverished, with virtually no middle class… and fractured by war.” 

Speaking Euskara (the Basque language) instead of Spanish was banned, jobs were moved elsewhere in Spain, and food became scarce. 

It was in this context that a young Catholic Priest arrived, Father José María Arizmendiarrieta


In listening to his new parishioners, he heard two things: people felt powerless to change the situation, and lacked an imagination for what any alternative could look like under Franco.  

So the priest focused his ministry on two priorities: action and education

Encouraging and cajoling, he organized community members to launch civic and cultural initiatives, including a soccer field, a medical clinic, and a housing complex for workers.

Their biggest achievement was the creation of a technical training school that aimed to move talented young people out of factory work and into better jobs. 

When the first five students graduated from this school, however, there were no better jobs for them to move to. Rather than give up, Fr. Arizmendiarrieta challenged them to create some. 

Together, the five graduates raised money from the local community and gave rise to the first cooperative in the valley: a small company producing kerosine heaters. Since the main motivation was less about the kerosine heaters than it was about giving people good work, they decided that everyone who worked there should have a say in deciding what good work looked like.

When these worker-owners later filed for social-security insurance with the government, they were denied. Franco’s regime argued that the new employees were not eligible for workers’ benefits because they were also part-owners. 

So the community organized again and Mondragon’s second cooperative was born: a cooperatively owned insurance agency that everyone paid into and anyone could withdraw from incase of an emergency. This organization proved so effective that 70 years later it still supplies worker-owners at Mondragon with sick leave, parental leave, a generous pension, unemployment benefits, and medical insurance - even though Spain long ago changed their policy on covering cooperatives.

Little by little, these cooperatives kept growing and a pattern emerged: when an obstacle confronted the community, people came together to identify individuals with the skills and capacity to take it on, and together they would create a new co-op to overcome it. 

When, for example, existing cooperatives wanted to expand the businesses but state-run banks wouldn’t lend to them, the community and Fr. Arizmendiarrieta founded La Caja Laboral Popular (literally, The Popular Labor Fund). This cooperative bank is also still alive and well, providing affordable financing to new cooperatives and community members alike; supporting businesses while also investing in the community. 

Today, the Mondragon Corporation is a federation of 95 distinct cooperatives. When some businesses do well, their members share in the profits. When times are hard, they collectively support one another, sharing funds and reallocating workers to preserve jobs. 

Mondragon is not a story about a white knight. There is no “savior.” Nor is it a story about individual accomplishment where hard work allowed a talented underdog to overcome social obstacles. This story is about A People. A people who move from feeling impotent and on the brink of despair, to building a world where they have power. 

The shift in the story occurs when the individuals figure out how to do together what could never have been done on their own. 

In this case, the vehicle of that collective action is cooperatives. But Dean Beloki and I agreed that it doesn’t have to be. 

Cooperatives are not a magic bullet, they are a business like any other. As the Dean put it at the end of our conversation: it is all about “why” you have a co-op in the first place: Is it to make your community’s life better, or is it to make money (knowing that a successful co-op has to do both)? Knowing which comes first will determine if you are more concerned about making profit for the community, or using the community to make a profit. 

Father José María Arizmendiarrieta

The first branch of Caja Laboral Popular 

The Basque National Orchestra celebrating the 50th aniversary of Mondragon in 2006

There is an old legend in the region about a dragon that once terrorized the people in the valley of Mondragon. Every year the dragon demanded the villages sacrifice one of their own to satiate its appetite. 

The villagers, unwilling to pay this costly tribute, deceived the dragon. When it arrived to carry away the first victim, it was instead given a life-like wax-statue disguised as a young woman. 

When it began to eat the figure, the wax melted in the dragon’s mouth. Now unafraid of the dragon’s fire, the villagers fell upon the monster and together and killed it with their tools. 

The lesson is unmistakable: other towns pleaded for St. George to slay their dragons. Here they did it by relying on one another. 

What is that if not community organizing?