>I am advocating this as specifically a measure to back and broaden an armed insurgency though. As a resource base for the armed insurgency that will come,specifically tied in to the labour movement and a communist party.
>As well as this, I don't believe the contradictions between unions and the workers state are political
This is the way I understood it too, however it has the same fallacy as the stalinist plan for transition to communism: just like the state must relinquish its centralised control at the point of transition (something that is against its material interests), so here the transition to armed insurgency will mean going against the material interests of the co-ops and potentially even the less radicalised workers who are already benefiting from the redistributive policies that the co-ops will run on. Political situations, unlike material conditions, are realistically impossible to plan for in an abstract context, so any plan that will require a political escalation of the workers struggle (realistically the armed insurgency will only really happen if the workers absolutely support it/demand it by virtue of necessity, that's how it occurred every other time) will need to account for the acceleration of contradictions between the state and the party to a point where it can only be resolved by bringing down the state. I'm not really sure how this can be approached considering that the co-op stage by itself will no doubt help (and in fact must help, otherwise the project fails) the material circumstances of the workers employed in them in the first place. This is not acceleration of the contradictions of capital, this is comparable to Keynesian policies aimed at cushioning the contradictions. Unless we are relying on building a political consensus that the state must be brought down? This is not certain to happen at all, and workers will need to be convinced to rise up despite their material conditions being improved.
The only way this can work is if the state is expected to try to confront and shut down this entire operation first, but as I mentioned before capital will be perfectly fine with an "economically just company" that is still beholden to the rules of the market anyway. At that point the discussion within the party is likely to be of the sort: "is it possible to pressure other companies to adopt our policies and reform capitalism into socialism" which is counterproductive and overly reliant on the supposition that redistributive justice on a company scale will be possible to sustain within capitalism forever which, again drawing on the lessons of Keynesianism and the neoliberal reaction, it won't be.
So the question is how do we convince the workers to abandon their material interests at a certain point in the struggle to take up the immensely personally risky prospect of taking on the capitalist state directly, and how do we guard against the inevitable attempts at diluting that goal? The answer is only political development, which is the sticking point of all modern socialist movements really because the only really successful ones had their political development almost entirely driven by applying marxism to their at the time absolutely terrible material circumstances (think hunger, homelessness, banditism, death as opposed to today's kafkaesque bureaucratic exercises that give you just enough to keep you hooked without you going completely rogue).
The contradiction that I see here is that improving material circumstances do not necessarily drive political development informed by marxism, especially not in the long term. But maybe this is an overly accelerationist point of view, I dunno.