What are you worth?
This comes from an argument Ive had a few times on myspace.com, about the "worth" of a persons job.
To begin with, I subscribe to the theory of labor value. That is, a good or service is basically worth the components that produce it. There are a couple components to the equation
1. Sale price
2. All fixed and variable costs outside of labor associated with producing a good or service
3. Labor Value
1-2=3 Very simple.
Now, for a capitalist to "profit" they must pay an employee at some value lower then 3. Every capitalist has SOME excuse for the amount they take. Usually, its simply the cut they take for their "monetary investment", occasionally its for their intellectual contribution, that is, they have some sort of patent or invention, that is generating demand, and therefore they believe they should be compensated for that.
On to the dilema.
It seems to be a general right wing argument, that a person is paid, for the value of the job they are doing, because the "free market" determines this rate.
I contend that, a person is NEVER paid what their job is worth as in so much a company is profiting, and a labor contract is simply that, a contract which stipulates a rate at which a person accepts to do a certain job, and in return has accepted a certain wage, and or benefits.
So who is right?
Let us examine a scenario.
Two guys are hired at the same fast food joint. Each have the same responsibility, and same hours. Niether has any prior experience.
Person A, accepts to sell his labor for 5.15 an hour.
Person B, gives the employer a line about his starving kid at home, and gets an extra dime an hour for sympathy.
What is the job worth then? 5.15? 5.25?
Is the value of Person B's job, worth more to the company, then person A, dispite them having the same job description, and same prior experience?
Furthermore, the capitalist is scraping many times more value from their job, then they are being compensated for, simply in compensation for his "investment".
So, I again pose the question, how could one possibly say that the wage you receive is what you're "worth"?
To begin with, I subscribe to the theory of labor value. That is, a good or service is basically worth the components that produce it. There are a couple components to the equation
1. Sale price
2. All fixed and variable costs outside of labor associated with producing a good or service
3. Labor Value
1-2=3 Very simple.
Now, for a capitalist to "profit" they must pay an employee at some value lower then 3. Every capitalist has SOME excuse for the amount they take. Usually, its simply the cut they take for their "monetary investment", occasionally its for their intellectual contribution, that is, they have some sort of patent or invention, that is generating demand, and therefore they believe they should be compensated for that.
On to the dilema.
It seems to be a general right wing argument, that a person is paid, for the value of the job they are doing, because the "free market" determines this rate.
I contend that, a person is NEVER paid what their job is worth as in so much a company is profiting, and a labor contract is simply that, a contract which stipulates a rate at which a person accepts to do a certain job, and in return has accepted a certain wage, and or benefits.
So who is right?
Let us examine a scenario.
Two guys are hired at the same fast food joint. Each have the same responsibility, and same hours. Niether has any prior experience.
Person A, accepts to sell his labor for 5.15 an hour.
Person B, gives the employer a line about his starving kid at home, and gets an extra dime an hour for sympathy.
What is the job worth then? 5.15? 5.25?
Is the value of Person B's job, worth more to the company, then person A, dispite them having the same job description, and same prior experience?
Furthermore, the capitalist is scraping many times more value from their job, then they are being compensated for, simply in compensation for his "investment".
So, I again pose the question, how could one possibly say that the wage you receive is what you're "worth"?
posted by Lethal_Poison at 8:00 AM
6 Comments:
Let's explore this a little further. Should an employer be forced to pay a prospective worker more then they are willing to work for?
Let's say you decide to open up a sub shop. You do all the research into regulatory requirements, get all the permits, invest in all the equipment etc etc. As a result of your efforts, you are able to offer employment to perhaps a dozen people. Must you pay your employees, according to your "1-2=3" labor value formula so that you make no profit on their labor? After all, you took on all the risk. If you made a bad business decision and lose your butt because no one will buy your subs, your employees are not going to chip in and help you with your loses.
Exploring a step even further. Let's take your two hamburger joint employees. Let's say they both are single and are both paid the same. One spends every paycheck on a fast car, a new plasma TV, cable for the TV, fine wines etc. The other guy lives frugally and invests half of every paycheck into stock in the hamburger joint chain. Should employee two not at some time or other hope to profit from his investments?
1. Capitalism is the REASON for the need of investment. One would not have to assume that risk, if capitalism was not in the equation. The labor value of production does not take into consideration economic system, because it is a moot point.
2. If capitalism is considered, what is an accurate assessment for the "value" of "risk". Is it correct that this is just an arbitrary number, determined by the level of greed the capital stakeholders reside at? Is it fair that, this "value" which is assessed simply for investment risk, and is of no relation to the physical process or sale of the good, should come off the backs of those who ARE responsible for those processes?
3. The argument of "who spends X amount on what items" has no bearing whatsoever on the argument at hand.
4. No, employee two, if he ever happens to become a shareholder, should not hope to "profit" off someone elses back. That is cruel and unique only to capitalism. A man should be rewarded only for what his brain and body can accomplish, not what his daddys trust fund can buy him.
But employee two did not benefit from his Daddy's trust fund. He benefited from saving and investing part of his earnings.
I agree with your condemnation of those who are born with a silver spoon in their mouth. However, is it wrong for a man to expect to be able to pass on some of what he earned to his children if he elects to not waste it all during his lifetime? This is why I love the "death tax". A rich man gets to pass on half his wealth, when he dies, to his heirs (or her heirs, I am not trying to be sexist) while "we", as represented by our government, get the other half.
Capitalism is part of the solution, not part of the problem. Nothing short of capitalism has been found to work within any large scale society. The Soviet Union and Red China proved communism does not work. Plenty of demand but unable to meet the needs of this demand with supply.
Now I am not in favor of raw capitalism, there needs to be some protections for the workers. However this is a delicate balance. Let us examine General Motors and Ford for example. The workers unionized and seized power. Once they had the power they became inebriated with the power. Their bloated wages for substandard results might drive these once proud companies out of existance.
1. But employee two did not benefit from his Daddy's trust fund. He benefited from saving and investing part of his earnings.
Response- It matters not how a person went about capturing capital, its the fact that he possesses it in the first place. Capital ownership is only the means of economically enslaving those who do not own capital.
At one point in time, even the silver spoon feds ancestors came up from nothing (assuming they arent some royal dynasty). So its wrong to assume that just because someone captured capital ownership today, that its any better then someone inheriting something that their daddy, or great grand daddy captured generations ago.
Although, its slightly more meritous that one directly worked for capital ownership, the result is no different, and its dispicable.
2. Capitalism is part of the solution, not part of the problem. Nothing short of capitalism has been found to work within any large scale society.
Response- Thats an unfortunate symptom of human condition, rather then the pitfalls of alternative systems. As long as there is a segment of society that wants more then they have, even at the expense of anothers well being, a socioeconomic system embracing equality will not succeed.
Furthermore, at all points in history, unfettered capitalism has capitulated due to its own pitfalls. The British Empire, France, Russia, China, Spain much of central and South America....its all fallen as those who are economically imprisoned rise up. This is the end for all capitalism which does not create a large enough safety net for its slave labor to maintain an acceptable safety net.
Hence why all of the biggest capitalist bastions in history, Spain, Italy, France, Portugal, Netherlands, Britain....are all heavily socialized now.
3. However, is it wrong for a man to expect to be able to pass on some of what he earned to his children if he elects to not waste it all during his lifetime?
Response- The key word is EARNED. I dont believe money generated off somebodies back by capital investment is "earned", it actually most closely resembles the definition of "stolen". If a man wants to work hard all his life, and creates a huge nest egg of cash, I think it should be passed along, all of it in its entirety.
I dont think that capital resources should be passed a long, or owned at all.
This would allow people to live comfortably off of their parents, or their parents labor value, but not off of others labor value, as investments allow for. Essentially, this would be simply transfering labor value to another generation.
4. The workers unionized and seized power. Once they had the power they became inebriated with the power. Their bloated wages for substandard results might drive these once proud companies out of existance.
Response- How much of this battle was waged on the premise of "us vs them"? The division between "ownership" and "employee" created that mess, and is the whole reason for "unionization" in the first place. IF one were to combine "ownership" and employee into one entity, would not those individuals create that balance themselves?
First off, I am not in favor of unfettered capitalism. I am in favor of a safety net for all. Even Ronald Reagan was in favor of a safety net.
In fact, I particularly love the Social Security system (and will note it is called Social Security as in "socialism" - grin). However I will note that even the Social Security system is open to fraud when it comes to the definition of who qualifies for "disability" payments.
Your last comment confuses me somewhat. You think it is OK for an individual to pass on saved cash to his descendants but seem to think this saved cash is not "capital"? Capital as in capitalism? Let's see, the individual saves his money in a bank account. The bank invests the money in the economy in the form of direct investment and through charging interest on loans to individuals. They pay part of the returns as interest on the bank account and keep the rest as profits. This is OK but for the individual to skip the bank and invest directly should somehow be prohibited? Either I am confused by your logic or if I understand your logic, I think it is rather illogical.
Why should it be wrong for an individual who works at a sub shop to save his money for a few years, then invest his savings in his own sub shop. He is risking his savings by investing in a long term lease, equipment and start up supplies and then provides employment for others who might be willing to work at a subshop. He should not receive any return for his investment? Why then bother with investing in the first place. He is risking everything in starting up his business because he might lose all of his savings and trash his personal credit rating for years to come. This individual should not be able to receive a return on his investment due to his investment of his savings and the risk he has taken on because it involves a capital investment?
Perhaps you think the government should be willing to open a sub shop for every sub shop employee who wants to run his own sub shop?
But I am not against employee ownership of corporations. Their is a pipe manufacturing plant (I think it is American Cast Iron Pipe) in Birmingham, AL where the man who started up the plant did not have any family and willed the plant over to his employees in the form of a trust. This plant has remained profitable at a time that much of heavy industry within the US is going bankrupt and has done so with an amazing safety record. However it took one man with the vision and the ability to put this enterprise together. Without the one man who put the whole thing together and at one point owned the whole company, the enterprise would never have gotten off the ground. Without capitalism, American Cast Iron Pipe would not exist.
1. First off, I am not in favor of unfettered capitalism. I am in favor of a safety net for all. Even Ronald Reagan was in favor of a safety net.
Response- I disagree completely with social safety nets outside of those provided for the sick, elderly, or severely mentally challenged. I believe any system that requires additional ones, such as welfare, section 8, food stamps, etc, has failed their society.
2. Your last comment confuses me somewhat. You think it is OK for an individual to pass on saved cash to his descendants but seem to think this saved cash is not "capital"?
Response- The definition of "capital" is an input required to produce a desired output, usually resulting in profit, measured by return on capital, return on investment, or return on equity. Current assets do not become "capital" until it is used in this manner. A person who actually WORKED for money, hid it under the mattress, and passed it to his kids is simply voluntarily transfering his labor value to his descendents.
3. Let's see, the individual saves his money in a bank account. The bank invests the money in the economy in the form of direct investment and through charging interest on loans to individuals. They pay part of the returns as interest on the bank account and keep the rest as profits.
Response- Whoa whoa whoa...at what point in time did I insinuate I thought that a bank investing money is cool? I am against ALL PRIVATELEY OWNED CAPITAL. This includes banks. Why would you assume that I thought a BANK using capital was ok, but a PRIVATE CITIZEN doing the same thing was wrong? Logical fallacies are the worst pitfalls.
4. He is risking his savings by investing in a long term lease, equipment and start up supplies and then provides employment for others who might be willing to work at a subshop
Response-
A. Rarely does a capitalist risk ANYTHING of his own. Those who do are complete fools. Furthermore, the modern capitalist is not "mom and pop grocery", he is Bill Gates, or Bill Ford, or the Waltons, insanely rich asswipes, sitting on top of faceless entities.
Do you think, even if Ford or Microsoft went bankrupt, that Gates or Ford would be on the hook for anything at all? Outside of the loss of share value, theyd be just fine.
B. I do not believe one should be "compensated" for simply assuming risk. The only reason why one assumes that risk is because of capitalistic systems of the unpredictable free market, and the ability to actually possess capital in itself.
5. He should not receive any return for his investment? Why then bother with investing in the first place.
Response- He should not be allowed to own capital resources in the first place. In other words, there should be no option for him to "invest".
6. He is risking everything in starting up his business because he might lose all of his savings and trash his personal credit rating for years to come.
Response- If only the Supreme Court didnt rule that corporations were an entity in themselves separate from their owners.
7. This individual should not be able to receive a return on his investment due to his investment of his savings and the risk he has taken on because it involves a capital investment?
Response- I think I addressed this.
8. Perhaps you think the government should be willing to open a sub shop for every sub shop employee who wants to run his own sub shop?
Response- Entrepreneurism is not a quality of communism or planned economies. The wants of such individuals would be ignored. I have no concern about the benefits of one individual at the expense of many.
9. However it took one man with the vision and the ability to put this enterprise together. Without the one man who put the whole thing together and at one point owned the whole company, the enterprise would never have gotten off the ground. Without capitalism, American Cast Iron Pipe would not exist.
Response- Thats bull, point blank. The man started the company IN capitalism, not BECAUSE of capitalism. The government could have constructed that corporation just as well as that man under the guise of communism. There wasnt anything extraordinary about what that man did, which was unique to capitalism.
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