The problem with cooperative ownership is it puts local interests over global interests, and gives rise to class distinctions. Local councils can play a part in a broader system, but local coops forming the basis of organization works directly against collectivized planning and production. The Soviet Union, early on, experienced directly the consequences of having too much local control, resulting in some local factories "gaming the system."

Not all forms of managament and administration are coercive or bad. Trying to solve the issues of management under capitalism and replicating the competitive class structure in a horizontalist fashion misanalyzes the problem and thus provides a faulty conclusion.