A negative judgment on worker cooperatives was first rendered early in this century by the prestigious social scientists Beatrice and Sidney Webb. Their verdict has been the conventional wisdom ever since:

All such associations of producers that start as alternatives to the capitalist system either fail or cease to be democracies of producers….

In the relatively few instances in which such enterprises have not succumbed as business concerns, they have ceased to be democracies of producers, managing their own work, and have become, in effect, associations of capitalists…making profit for themselves by the employment at wages of workers outside their association. (Coates and Topham 1968, 67)

The region developed autonomously until the political consolidation of the nation during the reign of Ferdinand and Isabella in the fifteenth century. The history of the region since then must be seen against a background of struggle by local leaders to preserve their autonomy and the efforts of the Crown first to accommodate that autonomy and then to suppress it.

The Basques took advantage of the political struggles of the kings of Navarre and Castile against the feudal lords in the thirteenth and fourteenth centuries. Up to this time, allied with the King of Aragon, the lords had controlled the countryside, and fighting among them had retarded the growth of commerce.

In their struggle against the King of Aragon and the feudal lords, the kings of Navarre, and later Castile, encouraged the growth of urban centers. To migrants to the towns and cities, the Castilian Crown offered freedom from the serfdom owed to feudal lords. The monarchs saw freeing the townspeople from the control of the feudal lords as a means of extending central control, whereas the Basques saw it as enhancing opportunities for local autonomy.

This struggle for autonomy was supported by the development of a distinctive Basque myth. By the fifteenth century, the Basques had persuaded the Spanish king to declare all inhabitants of Guipuzcoa hijosdalgos (people of known parentage or, literally, “sons of something”) and thus “noble” and “equal” in relation to each other. (Hidalgo, a shortened form of the word, was a title given in Spain to members of the minor nobility.) Ironically, the myth did not base egalitarian claims on the virtues of the common man but rather on the comforting fiction that, because they were all of noble blood, Basques were equal among themselves and superior to other peoples.

Democratic local governments expressed the egalitarian spirit. In the sixteenth and seventeenth centuries, every male head of a family was entitled to vote for members of the municipal government, and in Guipuzcoa and Vizcaya municipalities elected representatives to a provincial government. The general assemblies in these two provinces codified the common law into what were called fueros (laws to govern and administer the provinces as autonomous units). As the bases for local democracy, the fueros are looked on with nostalgia by many Basques. From the seventeenth century on, the Spanish Crown withdrew much of its support of local autonomy and restricted the right to vote in municipal elections to those who met a wealth requirement, thus halving the number of voters.