Ask a Red, Second Edition

[civver_764]

The company has other costs. Variable costs of the iron. Fixed costs of administration. Interest cost for debt-holders.

Which is why socialism argues for public ownership of that stuff. And even with all the costs together a profit still has to be made, and it doesn't go to the people that produced that profit.

Return on investment for shareholders. The company needs to make a profit for its shareholders that is in line with its riskiness. Nobody will invest in it if there isn't a fair return on value.

You act like this is something that should concern me.

 

[Defiant47]

Cost of capital/money (interest and say dividends) is no less real than cost of material and administration.

 

[civver_764]

I recognize that, but it's completely besides the point. I'm not saying that this exploitation isn't necessary, in fact I recognize that it is, which is why we advocate for a complete change of the system.

 

[aelf]

A business also has other costs. In general, a business's aim is not just to "make a profit", but to make a specific amount of return on investment based on the riskiness of the firm. Naturally, doing better is really good, but on average, this is what businesses will achieve.

That is, business will sell a product at a price above marginal cost of labour in order to make a profit despite all the other costs, and will set the price to make sufficient profit in order to properly compensate stockholders. It's little different from having to pay interest on your debts, but in this case it's generating sufficient return for your stockholders.

Is it fair that these stockholders receive such a (usually) higher return? Yes, because they engage in a riskier venture than simple debt-holding.

You asked about the Marxist notion of exploitation. I don't see how this in any way leads from that discussion, except maybe with respect to the idea that profit is fair. That's not a direction I'd take the discussion because it will simply end in a normative quagmire, where the best I could hope for is that nobody pretends that he's being 'objective' or to be championing some kind of Popperian scientific perspective à la Alassius.

My point is that measuring the value of labour by the income it generates is precisely the wrong way to go about trying to understand what Marxists mean by the exploitation of labour. If you are unsatisfied with my explanation because you see no other way of measuring it, then I can't help you here. I will note, however, that insofar as wage rates are considered the measure of the value of labour on the market (i.e. the exchange value or price of labour), they don't exactly relate directly to the potential income that labour generates (i.e. the marginal revenue product of a worker). If firms don't think they can make a profit if they hire more labour, they simply won't hire. If many firms don't think so, then they might influence wage rates by not hiring, but clearly the price of labour on the market is exogenous and is therefore not determined by the marginal revenue product of a worker.

Perhaps buyers have a considerable capacity to set prices, but that's still not an issue. If I'm selling oranges, maybe I'm at a very disadvantaged position and can't set any prices. Their real worth is $1 per orange. A buyer may come by and offer me 50 cents an orange, and I'd be inclined to accept.

But if the oranges were truly worth $1 each, then someone else could then come in and offer me 75 cents per orange instead, and take all of the extra profit for themselves. And why wouldn't they? Why would they let 50 cents of profit go to someone else, when they could get 25 cents of profit for themselves.

The same works with wages and the market. Unless you posit a monopoly or cartel situation, which is not legal due to anti-trust laws, the market will find a fair and equitable wage for each person, or at least close to. The market may be "inhuman", but I daresay it's more effective at determining fair wages than any human that may try.

I don't understand this at all. This seems to bear no relation to the economic knowledge I have of labour markets or of any market. Nor do I have any idea how this follows from the discussion of the Marxist conception of exploitation. I suggest, first of all, defining what 'true worth' is. You would also need to explain your model for the orange transactions because it makes no sense at all. Additionally, I suspect the notion of "equitable" or "fair" at the end is rather vacuous.

 

[GenMarshall]

Why do communists have an apprehension to workers moving up the socioeconomic ladder?

 

[Traitorfish]

Why should one prefer a "Red" system over a capitalist system with strong social programs?

Because only fools trust capitalist states.

Why was red chosen as the official color of communism?

It's taken from the red flag, which emerged as the symbol of communism in the mid-19th century. The red flag was originally the symbol of Jacobinism, an ideology whose adherents were by the post-1848 period overwhelmingly lower class workers and artisans. French socialism and communism emerged out of this milieu (in the 1871 Paris Commune, for example, there was no clear distinction between socialists and left-Jacobins), so they continued to use the red flag, from where it spread to other countries.

I haven't read the entire thread so i apologize if this has been covered. At what point do you feel the Soviet Union betrayed its communist ideals? Basically at what point (if there is a point) did the USSR become a nation you couldn't support?

It's hard to say, exactly, because there are varying levels of support. As I said before, the Bolsheviks could be seen to have departed from a "conventionally" revolutionary road as early as late 1918, and from there we see the gradual collapse of working class power and the emergence of a de facto capitalist class in the form of the state bureaucracy, something which finally cements itself when Stalin ousts the Bolshevik old guard in the late 1920s. A line can probably be drawn under the 1924 Constitution, which formalised the usurpation of soviet power by the state,

Also why do you feel Communism or even Socialism never became as influential or important in the US as in other parts of the world? It had some influence to be sure, but not what it did in Europe for example.

Well, that's a question that they're quite literally been writing books on since the 1890s, but I think that there are two main points. The first is that America never saw the emergence of class politics on a large scale, as emerged in Europe. Even when left-leaning populism did emerge, it was usually expressed in terms of "big business" against the "little guy", which meant that the American working class tended to end up tailing parties organised primarily by and for small businessmen and professionals, rather than the themselves. (This also intersects with the prominence of racial politics in the US, which lead a lot of workers to disdain class politics which would set them alongside black, Hispanic and Asian workers- or even Jewish, Irish and Slavic ones, if they were that way inclined- and to take refuge in the "respectability" of the small independent citizen, an identity removed from objective class relations.) The second is the ruthless efficiency with which the American capitalist class cracked down on union organisation and activity in the late 19th and early 20th century, and on union militancy in particular (not least the casual use of extra-legal, frequently lethal force in those areas outside the easy reach of law) leaving a labour movement that was weak, narrow, and dominated by bureaucrats desperate for compromise. (Even at the height of American union power in the post-war era, we were looking at successful compromises between corporate and union bureaucracies, rather than hard-won victories like in Europe.) The effects of this can be seen even today, with a small and beaten labour movement that trails the Democratic Party, until very recently without complaint.

I despise and distrust dictators on principle. I am not a fan.

Lenin really can't be considered a dictator. He had a lot of influence within the Bolshevik party, sure, but did not sit above it or its structures, as Stalin did (de facto, if not de jure). If you're going to discuss dictatorship in the early Soviet Union, its better to speak in collective terms, i.e. of a Bolshevik party-dictatorship along roughly Jacobin lines, rather than in terms of personal despots.

He seems to me more an opportunity angry at the aristocracy than an actual idealist who wanted to create a better world.

The aristocracy were already an irrelevance by October 1917. They'd lost most of their institutionalised power the Tsar was overthrown, and collapsed as a class when the peasants seized their land after the Second Revolution. Lenin's real beef was with the international bourgeoisie, Russia just happened to be the part of the world he was operating in.

a Reds opinion on Tito.

What is there to say? Tinpot nationalist dictator, more benign than most, but ultimately nothing to admire.

Can a dictator express the will of the working class, and thus, be productive, and possibly, even necessary, during the transistory stages to Communism?

Nope. The radically democratic self-organisation of the working class is the necessary precondition of revolutionary. The working class is the sole revolutionary subject, and no bourgeois dictator, however benign, can substitute himself for them.

Let me posit the question in a more reasonable manner:

Why is the exchange of labour for wages an inherently inequitable and exploitative one?

I wouldn't say that it is. It just so happens that in practice this exchange will overwhelmingly take an inequitable and exploitative form, and the nature of capitalism means that without massive and quite probably unsustainable intervention, such exchanges will emerge as predominant.

You do realize that workers can also extract profit from corporations. When the corporation is making profit, then it is considered that this profit has been extracted from workers' labour, and then distributed to the capitalists (owners). But then why is it not considered that a corporation making a loss, would have profit extracted from its workers? That is, the workers are extracting more money out of the corporation (via salary and wages) than it is truly worth.

I know the latter doesn't happen too frequently, and misses a few points when taken in context, but I wish to build the idea that workers aren't necessarily exploited or enslaved, because they are given equitable wages. Equitable because that's how the free market works (or close to).

This is a fair point, which is why it's important to stress that the problem with capitalism isn't exploitation as such, but the conditions of exploitation, which is to say, the separation of labour from capital and, in Marx's terms, the subsumption of labour under capital. I don't think that you'd even have to find an unsuccessful private company to find such employer-employee relations, but at any enterprise which is not operated for profit, whether a state-controlled public service (the education system, say) or an independent non-profit. Exploitation, for Marx, is not so much significant because of the ethical concerns it may produce, but as the economic mechanism which explains the production of profits under capitalism.

I want to ask a personal question here. How do friends and family react when you explain your political views? All the communists/socialists I know are hardly taken seriously (by either Democrats or Republicans) in real life political discussion since they are such a small minority.

Well, most of the people I know would probably fall under the category of "social democrat", so they generally agree on the existence of certain problems, but disagree about how one would go about addressing those problems. (My dad is probably the most sympathetic, being a bit of an Old Labour type who is even willing to accept Marx as a reasonable authority on the faults of capitalism.) Some would simply say that I'm too pessimistic about liberal democracy and capitalism, while others would say that I'm naive or idealistic. The more theory you pack into your head, though, the more they tend to say the former and not the latter.

Why do communists have an apprehension to workers moving up the socioeconomic ladder?

We don't, we just don't think that individual advancement can be relied upon as an effective remedy to problems which effect the working class as a whole, or society as a whole. We would prefer that a dozen workers got a 10% raise than one worker got a 50% raise and the rest nothing.

 

[aelf]

This is a fair point

Nah, it isn't because exploitation is a matter concerning the value of labour in general and not the value of labour to a particular firm, to put it simply.

 

[Perfection]

1) The capitalist system is unjust at the core, adding social programs to it doesn't change the core. It doesn't change the unjust power relations, it doesn't change the nature of the state as a tool of the bourgeoisie, and it doesn't change the fact that workers are exploited and alienated from the means of production.

2) Social democracy will never reach its intended goals. We'll get a few reforms every few decades or so to pacify the population but beyond that you have to remember who is in charge of the reforms in the first place - the state. And the state has really no interest in making society more equitable or "more fair"(why would it?), it only exists to serve the interests of those who prop it up -- ie. the bourgeoisie.

So how would a red system rectify these problems?

3) It isn't even a consistent ideology. You believe in property rights but also believe in violating those rights for some arbitrary feelings of "fairness" and "social justice"?

I don't think believing in strong property rights is essential to support capitalism. You appear to, why is that?

4) Social democracy involves some hefty taxation of some sort which can't really be justified all that well.

What is so unjustifiable about it?

5) And why go half way when you could go all the way?

Why go all the way, when you can just go half the way?

 

[Cheezy the Wiz]

Let me posit the question in a more reasonable manner:

Why is the exchange of labour for wages an inherently inequitable and exploitative one?

It's not. It's the manner in which it happens in the capitalist system that makes it exploitative. The capitalist, who supplies the capital, takes advantage of the fact that the worker has nothing to bring to the bargaining table except his ability to work said capital, in order to offer him as little wage as possible in return for producing products of wealth and value with his machines. He then keeps the profits from those products and distributes them as he wishes, which is why he gets the lion's share himself and the workers get the bone he throws to them. That is, by definition, exploitation.

In a socialist system, a worker would presumably still have to exchange his ability to work for wages. But the fact that he has a democratic say in the structure of those wages renders the exploitation naught, since it, by definition, could not exist. Unless you think democracy is oppression. I'm sure a minority member may think so. But in the context of issues such as these, the opinion of the minority is really irrelevant, since it is almost certainly self-interest at the expense of the majority.

I want to ask a personal question here. How do friends and family react when you explain your political views? All the communists/socialists I know are hardly taken seriously (by either Democrats or Republicans) in real life political discussion since they are such a small minority.

My mom votes Republican, but that's because she hates the democrats for some pathological reason. She's a very live and let-live person, though, and she proudly stated the other day at lunch the irony that her two children have become a communist and a hippie. Not sure if my dad knows, but he's a Reaganite libertarian (aka completely politically confused) and probably disapproves. My sister agrees with most of what I say, but isn't intellectual enough to care about the finer points of stuff.

I've made it a point in my predominantly conservative family not to directly discuss the core of my politics. I'll talk about things that are happening in politics, the characters and goings on, but not political theory itself.

My friends are all either supportive or understanding. My best friends are either libertarians or centrists for the most part, and we enjoy political sparring and respect each for our prowess.

Can a dictator express the will of the working class, and thus, be productive, and possibly, even necessary, during the transistory stages to Communism?

Yes. But it is holding a tiger by the tail.

 

[Perfection]

Why should we have to wait for handouts from Master, and thank him for his infinitely warm heart for finding the mercy to provide us with them, in order to survive?

I'm not sure that's an accurate representation of a capitalist society with strong social programs, we have the avenue of democracy to force the state to (roughly) behave. Am I missing something here?

Because only fools trust capitalist states.

Why is it more foolish then trusting a red state?

 

[Defiant47]

I recognize that, but it's completely besides the point. I'm not saying that this exploitation isn't necessary, in fact I recognize that it is, which is why we advocate for a complete change of the system.

You do not believe it fair that people should have to pay for the use of money received from loans and contributions?

Bear in mind that there isn't any real inequity or lack of freedom here - the worker can take full part in the capitalist's share of the profit by purchasing shares of the company, but he would be exposing himself to risk. Instead of just making set wages that will see him through to food on his plate, he risks his money (just like the capitalist) in order to obtain the greater profits.

You asked about the Marxist notion of exploitation. I don't see how this in any way leads from that discussion, except maybe with respect to the idea that profit is fair. That's not a direction I'd take the discussion because it will simply end in a normative quagmire, where the best I could hope for is that nobody pretends that he's being 'objective' or to be championing some kind of Popperian scientific perspective à la Alassius.

My point is that measuring the value of labour by the income it generates is precisely the wrong way to go about trying to understand what Marxists mean by the exploitation of labour. If you are unsatisfied with my explanation because you see no other way of measuring it, then I can't help you here. I will note, however, that insofar as wage rates are considered the measure of the value of labour on the market (i.e. the exchange value or price of labour), they don't exactly relate directly to the potential income that labour generates (i.e. the marginal revenue product of a worker). If firms don't think they can make a profit if they hire more labour, they simply won't hire. If many firms don't think so, then they might influence wage rates by not hiring, but clearly the price of labour on the market is exogenous and is therefore not determined by the marginal revenue product of a worker.

I don't think it's so "clearly" as you put it. Though I do find it odd to measure the value of labour by something other than the income it generates. Currency is just a shortcut to goods and services, made to make our economy easier. If we lived in a barter economy, then surely a worker who makes 3 tables would have 3 tables worth of items (money) or whatever he could exchange those for (other goods).

So the "income" generated by a worker directly relates to the value of that worker's work. If a worker's education, initiative, and ability only brings $20/hour worth to the company in income, then why should he be paid more? Of course, he will get paid a bit less usually, which I attribute to "administrative" costs and slight inefficiencies in the market. But in the end, he will receive equitable wages.

In a Marxist system, it should be no different. Should a worker receive more than he inputs into the system? Perhaps out of charity and social programs, but at the core, there needs to be some sort of merit and achievement.

I don't understand this at all. This seems to bear no relation to the economic knowledge I have of labour markets or of any market. Nor do I have any idea how this follows from the discussion of the Marxist conception of exploitation. I suggest, first of all, defining what 'true worth' is. You would also need to explain your model for the orange transactions because it makes no sense at all. Additionally, I suspect the notion of "equitable" or "fair" at the end is rather vacuous.

Really? You don't understand this?? It is one of the simplest examples of how a market works, and will find the true price of a product. In my example, do you think, given free market principles (free flow of information, equal competition, etc), that Oranges will be sold at a price far less than $1.00? Definitely not. The same is true for labour.

If the wages of a person should be X, because that's how much value they bring to any firm, then they will get wages close to X, because of how the free market works.

It follows the discussion because you can't have exploitation when workers are being given an equitable price for their labour. It would be exploitation if it were far less, but it is not.

As for "true worth", I'd rather not get into that discussion, but it's more of an idea that I brought up in order to bypass semantics and irrelevant other minor things. Something can have a worth, and that's all we need to know.

I wouldn't say that it is. It just so happens that in practice this exchange will overwhelmingly take an inequitable and exploitative form, and the nature of capitalism means that without massive and quite probably unsustainable intervention, such exchanges will emerge as predominant.

A fair point, given how we've noticed in the earlier industrial era mass-exploitation necessitating government intervention. Do you believe it is still at an "exploitative" stage currently?

This is a fair point, which is why it's important to stress that the problem with capitalism isn't exploitation as such, but the conditions of exploitation, which is to say, the separation of labour from capital and, in Marx's terms, the subsumption of labour under capital. I don't think that you'd even have to find an unsuccessful private company to find such employer-employee relations, but at any enterprise which is not operated for profit, whether a state-controlled public service (the education system, say) or an independent non-profit. Exploitation, for Marx, is not so much significant because of the ethical concerns it may produce, but as the economic mechanism which explains the production of profits under capitalism.

Perhaps so. But if it works for the economy, and creates a (more or less) equitable system, then there shouldn't be a problem.

I get what you're saying, but I want to present the idea that the separation of labour from capital is a good thing. Workers receive set wages that assure them a standard of living. They are not exposed to firm risks, other than possibly losing their job and having to find another.

The crux of the idea is that workers don't have to be separated from capital. They can invest their earnings in the shares of the company. In fact, it is easier to do this today than it ever has been, given how publicly traded most stocks are. Certainly in the past, this wasn't an option, but now that it is workers can easily join in.

A worker doesn't have to simply accept the money that his company gives him and take no part in the profits. The worker has the option (in publicly-traded companies) to take full part in the profits if he so chooses. The caveat is that he will be exposed to the same risk as the capitalists - that he might lose all his money.

Does the worker want safe and secure wages, or risky profits similar to the capitalist? It's up to him.

Nah, it isn't because exploitation is a matter concerning the value of labour in general and not the value of labour to a particular firm, to put it simply.

Certainly if I'm an excellent accountant and would bring a lot of benefits to whatever firm hires me (whether in a capitalist or communist society), then I shouldn't get the same wages/benefits if I were an orange peeler, creating significantly less value. Naturally, in a free market system, I will go for the job that pays me most, which will be where I can contribute the most.

It's not. It's the manner in which it happens in the capitalist system that makes it exploitative. The capitalist, who supplies the capital, takes advantage of the fact that the worker has nothing to bring to the bargaining table except his ability to work said capital, in order to offer him as little wage as possible in return for producing products of wealth and value with his machines. He then keeps the profits from those products and distributes them as he wishes, which is why he gets the lion's share himself and the workers get the bone he throws to them. That is, by definition, exploitation.

First of all, "nothing to bring to the table except..." puts down the ability and value of the worker too easily. The worker's ability to work said capital gives him all the bargaining power he needs. I could likewise say that the capitalist has nothing to bring to the bargaining table except salary and benefits. The two need to coexist, and need each other, one no less than the other.

Secondly, the "as little wage as possible" part is a non-issue. Yes, technically the capitalist wants to provide as little wage as possible... but due to the nature of the free market and competition, this wage will end up being a fair and equitable wage for the value of the worker. If it isn't, then a different capitalist could swoop up the worker with a better wage that still retains profits. Naturally, it wouldn't happen immediately and directly, but this is the long-run effect.

Thirdly, the capitalist needn't be the only one who "keeps the profits". The worker can take the profits as well, if he wishes, but then he has to incur the same risks as the capitalist. I've addressed this issue in my other responses. Basically the worker can buy shares of the company, and never again have to complain "but my capitalist boss gets to take all of the profit".

It's a simple choice. Would you like me to pay you $30K/year, or would you like to receive a randomly fluctuating sum of money, which on average will usually be better than that $30K, but much more volatile? It's always your choice.

In a socialist system, a worker would presumably still have to exchange his ability to work for wages. But the fact that he has a democratic say in the structure of those wages renders the exploitation naught, since it, by definition, could not exist. Unless you think democracy is oppression. I'm sure a minority member may think so. But in the context of issues such as these, the opinion of the minority is really irrelevant, since it is almost certainly self-interest at the expense of the majority.

Well then we get into the issue of, does the worker have the ability to properly decide wages? Would the capitalist not be better suited to this task, seeing as the capitalist has to deal with all of the company in context?

Most workers don't want to involve themselves in managerial decisions or anything like that. Those who do can take additional post-secondary courses and degrees, and pursue higher-ranking positions. But for those who don't, you think they have any capacity to properly set wages for everyone, democratically?

It would be like asking coal mine workers to vote on an accounting-based school curriculum. It just doesn't work.

 

[civver_764]

So how would a red system rectify these problems?

Primarily through the socialization of labor. Private property as we know it today would be essentially abolished, and all land would be owned in common(as it was for the majority of human history), the rights of it given to whoever was using it at a particular time. This would result in workers no longer having to rely on producing for other people, using other people's resources in order to secure their livelihoods. This would also eliminate the hierarchical nature of the workplace.

I don't think believing in strong property rights is essential to support capitalism. You appear to, why is that?

Oh I dunno, probably has something to do with the fact that capitalism is completely based on property rights?

What is so unjustifiable about it?

The government is literally stealing money from people. They then use this money to support all sorts of atrocious things, the mass slaughter of foreigners for the benefit of the military-industrial complex, billion dollar subsidies to multi-national corporations, the incarceration of millions of its own citizens, the propping up of dictatorial regimes around the globe. What's justifiable about it? I suppose you'll say welfare, and I'd be inclined to agree that's its a necessary evil for the time being for that reason, but that's exactly what it is - a necessary evil.

Why go all the way, when you can just go half the way?

Mediocrity sucks.

You do not believe it fair that people should have to pay for the use of money received from loans and contributions?

No as I disagree with the entire idea of private property. I find it abhorrent that one can simply make money by exhibiting no effort at all but spending money they already have. I find it absurd that people can own vast tracts of land that they don't even use. Not to mention all private property originated with the use of force and coercion and "might makes right".

Bear in mind that there isn't any real inequity or lack of freedom here - the worker can take full part in the capitalist's share of the profit by purchasing shares of the company, but he would be exposing himself to risk. Instead of just making set wages that will see him through to food on his plate, he risks his money (just like the capitalist) in order to obtain the greater profits.

So because workers have a (heavily diminished) chance of doing the same thing makes it ok? The fact is the entire system is wasteful and exploitative, and ought to be changed. It might look fair on a quick glance, but that's just because its the society we're all used to.

 

[Cheezy the Wiz]

You do not believe it fair that people should have to pay for the use of money received from loans and contributions?

No. Ask St. Thomas why.

First of all, "nothing to bring to the table except..." puts down the ability and value of the worker too easily.

It puts it in very real terms. I do not apologize is if that bothers you.

The worker's ability to work said capital gives him all the bargaining power he needs.

Collectively, yes. Individually, no. No one cares if I quit my job cooking. But a lot of people care if a hundred or a thousand cooks walk out in protest.

The point is that the worker has no alternative for supporting himself except his ability to perform labor. Thus it is the only thing he can bargain with. Which further explains why the relationship that develops between him and Mssrs. Capitalist is exploitative.

I could likewise say that the capitalist has nothing to bring to the bargaining table except salary and benefits. The two need to coexist, and need each other, one no less than the other.

Yes you could say that, in a capitalist system. But it has been proven that we don't need capitalists to run things, we can do it ourselves just fine.

Secondly, the "as little wage as possible" part is a non-issue.

It is essentially the issue.

Yes, technically the capitalist wants to provide as little wage as possible... but due to the nature of the free market and competition, this wage will end up being a fair and equitable wage for the value of the worker.

Missing the point! Even if the capitalist provided him with a wage precisely equal to his own, it's not his place to decide that in dictat.

Besides, what exactly is a "fair and equitable wage?" I should think that fair and equitable would be somewhat reflective of the value of the objects he has created. After all, it is because he has created them that they have value at all, not because the capitalist owns the machines that were used to create them.

If it isn't, then a different capitalist could swoop up the worker with a better wage that still retains profits. Naturally, it wouldn't happen immediately and directly, but this is the long-run effect.

These work in reverse, you know. You can fix wage prices too, it's not very hard and it needn't be so formal as a cartel. Most employers do it. Why pay someone more when I can get away with paying them less? If everyone else is paying cooks $10/h, then why bother to pay them $11/h? Paying them more doesn't guarantee that the cream of the crop will come to your restaurant, I can directly attest to that.

Thirdly, the capitalist needn't be the only one who "keeps the profits". The worker can take the profits as well, if he wishes, but then he has to incur the same risks as the capitalist. I've addressed this issue in my other responses. Basically the worker can buy shares of the company, and never again have to complain "but my capitalist boss gets to take all of the profit".

This is horribly insulting to working people. With what capital would they start this "business of equal risk?" With what knowledge? With what money would they buy this competitive amount of shares? Not that boards of directors listen to shareholders anyway!

It's a simple choice. Would you like me to pay you $30K/year, or would you like to receive a randomly fluctuating sum of money, which on average will usually be better than that $30K, but much more volatile? It's always your choice.

As I tire of explaining, no, it is not. It is no more a choice than a slave has the choice to run away from the plantation and go start a farm next door. I suggest you increase your contact with working people - the true working class, not college kids forced to get a job by mummy and daddy.

Well then we get into the issue of, does the worker have the ability to properly decide wages? Would the capitalist not be better suited to this task, seeing as the capitalist has to deal with all of the company in context?

The workers are the company. And no, he isn't best suited to it, because he does not behave in a manner conductive to the well-being of the people in the company. Capital is a tool to enrich the private property owners, and they don't care who they hurt in obtaining that money. The capitalist will always keep the largest share for himself, and throw his employees, his company, and even his country to the wind if it means a huge gain for himself. The recent bailouts and corresponding golden parachutes should be proof enough for you of that. It's just good business, as the saying goes.

Most workers don't want to involve themselves in managerial decisions or anything like that.

Of course they do. Ask any employee, they have a hundred ideas about how to improve things. Little things here and there, a better way to do this or that, or even big ideas about structure, pay, and the path of the company.

This is essentially like saying that most peasants don't want to involve themselves in decisions of state or anything like that. And I don't think you're an anti-democrat. The argument for democracy in politics and democracy in the workplace are identical. Because people ought to have a say in the affairs that govern their lives.

Those who do can take additional post-secondary courses and degrees, and pursue higher-ranking positions.

With. What. Money.

But for those who don't, you think they have any capacity to properly set wages for everyone, democratically?

Yes. And if they can't, they can at least pick someone who does. I can't understand the finer points of diplomacy, but that doesn't mean I shouldn't be able to vote for the president.

It would be like asking coal mine workers to vote on an accounting-based school curriculum. It just doesn't work.

That's funny, because it works right now.

Do yourself a favor and read The New Industrial State. The vast majority of the economy doesn't work the way you think it does. Corporations are committee-driven enterprises, where groups of experts in various fields present their ideas and proposals are voted on democratically in order to be implemented. Socialism in the broadest sense would be an expansion of this practice to the factory floor, whereas now it consists only of corporate level white-collars.

 

[Traitorfish]

A fair point, given how we've noticed in the earlier industrial era mass-exploitation necessitating government intervention. Do you believe it is still at an "exploitative" stage currently?

Profits are being made, so, by definition, yes, it is.

Perhaps so. But if it works for the economy, and creates a (more or less) equitable system, then there shouldn't be a problem.

I get what you're saying, but I want to present the idea that the separation of labour from capital is a good thing. Workers receive set wages that assure them a standard of living. They are not exposed to firm risks, other than possibly losing their job and having to find another.

The crux of the idea is that workers don't have to be separated from capital. They can invest their earnings in the shares of the company. In fact, it is easier to do this today than it ever has been, given how publicly traded most stocks are. Certainly in the past, this wasn't an option, but now that it is workers can easily join in.

A worker doesn't have to simply accept the money that his company gives him and take no part in the profits. The worker has the option (in publicly-traded companies) to take full part in the profits if he so chooses. The caveat is that he will be exposed to the same risk as the capitalists - that he might lose all his money.

Does the worker want safe and secure wages, or risky profits similar to the capitalist? It's up to him.

Is that actually a meaningful choice, open to the majority of workers? You talk as if workers could all become bourgeois overnight, if only they wanted to, as if they had anywhere near the ability to invest on bourgeois levels. And, even if they do invest what little they have, the separation of labour from capital and the subsumption of labour under capital both continue. A little bit of pocket money does not fundamentally change a persons relationship to society, nor does it allow him to reshape the conditions in which he redeems his labour power in the form of wages, which he is still entirely reliant on. The "little guy" who can invest enough to supply them a potentially living wage is marginal enough as to be irrelevant, on a society-wide level, just another lumpenbourgoisie, an individual with as much bearing on the course of society as any tramp, just with a bit more money in his pocket.

 

[Defiant47]

Excellent replies, everyone!

This is exactly what I was looking for.

 

[Cheezy the Wiz]

You talk as if workers could all become bourgeois overnight, if only they wanted to, as if they had anywhere near the ability to invest on bourgeois levels. And, even if they do invest what little they have, the separation of labour from capital and the subsumption of labour under capital both continue. A little bit of pocket money does not fundamentally change a persons relationship to society, nor does it allow him to reshape the conditions in which he redeems his labour power in the form of wages, which he is still entirely reliant on. The "little guy" who can invest enough to supply them a potentially living wage is marginal enough as to be irrelevant, on a society-wide level, just another lumpenbourgoisie, an individual with as much bearing on the course of society as any tramp, just with a bit more money in his pocket.

Besides, as the saying goes: when everyone is a capitalist, no one is a capitalist. Capitalism is dependent upon the hierarchical structure of exploitation and the corresponding division of wealth and power. The expansion of private property demands the expansion of wealth, which demands an expansion of power. And so integument is burst asunder, and the knell of capitalism sounds.

 

[aelf]

I don't think it's so "clearly" as you put it. Though I do find it odd to measure the value of labour by something other than the income it generates. Currency is just a shortcut to goods and services, made to make our economy easier. If we lived in a barter economy, then surely a worker who makes 3 tables would have 3 tables worth of items (money) or whatever he could exchange those for (other goods).

So the "income" generated by a worker directly relates to the value of that worker's work. If a worker's education, initiative, and ability only brings $20/hour worth to the company in income, then why should he be paid more? Of course, he will get paid a bit less usually, which I attribute to "administrative" costs and slight inefficiencies in the market. But in the end, he will receive equitable wages.

In a Marxist system, it should be no different. Should a worker receive more than he inputs into the system? Perhaps out of charity and social programs, but at the core, there needs to be some sort of merit and achievement.

Really? You don't understand this?? It is one of the simplest examples of how a market works, and will find the true price of a product. In my example, do you think, given free market principles (free flow of information, equal competition, etc), that Oranges will be sold at a price far less than $1.00? Definitely not. The same is true for labour.

If the wages of a person should be X, because that's how much value they bring to any firm, then they will get wages close to X, because of how the free market works.

It follows the discussion because you can't have exploitation when workers are being given an equitable price for their labour. It would be exploitation if it were far less, but it is not.

As for "true worth", I'd rather not get into that discussion, but it's more of an idea that I brought up in order to bypass semantics and irrelevant other minor things. Something can have a worth, and that's all we need to know.

The way you look at the valuation of labour is certainly strange. And so is the idea of 'true worth' you are positing, which seems to be something quite apart from both demand and supply and the labour theory of value. But let's focus on labour because that's what we're discussing. The value of labour on the market is measured by the wage rate, not by how much a particular worker makes for a particular firm. I just want to make that clear. Changes to the wage rate can be caused be a general change in productivity or the price of the product made, but only through the market mechanism in the labour market - i.e. firms want to hire fewer or more workers at the going rate, causing the price of labour or wage rate to decrease or increase in response to the change in demand. Of course this is just a model, but I think the lower in the social hierarchy we go the more this is true.

That's conventional economics. Now to talk about the Marxist idea of exploitation, which is based on the labour theory of value. Let's go back a bit and look at the post I'm addressing:

You do realize that workers can also extract profit from corporations. When the corporation is making profit, then it is considered that this profit has been extracted from workers' labour, and then distributed to the capitalists (owners). But then why is it not considered that a corporation making a loss, would have profit extracted from its workers? That is, the workers are extracting more money out of the corporation (via salary and wages) than it is truly worth.

Exploitation (which is what "extracting profit" entails) comes about through surplus value, which is the source of profit, though it does not follow that firms will always make profits where there is surplus value. Marx held that the true value of labour is how much labour produces in a given amount of time. So assuming the price of a product is $10 and a worker can make 5 of those in 1 hour, the true value of the worker's labour is $50 per hour. Marx holds productivity constant here as 5 is a number derived from the idea of socially necessary labour time, which means that it takes on average 12 minutes to make 1 of that product and hence 60 minutes to make 5. So, presumably, even if a particular worker makes 6 or 4 in an hour, it's not going to make his value of labour more or less than $50 an hour. This seems to match the idea of the wage rate being affected by general changes in productivity and not by variations in productivity between individual workers. But the capitalist would not pay the worker $50 an hour because he wants to make profit. So he pays the worker, say, $10 an hour, which is the rate for 1 product and hour. This clearly sounds like a raw deal if the $40 is simply docked from the worker's real hourly pay, so how it's done is while the worker needs to make, say, $100 a day, which originally meant that he only needs to work 2 hours a day, the capitalist pays the worker $100 a day for 10 hours of work or $2000 for a month's work at 5 days a week and 10 hours a day.

This is really just a rough illustration of surplus value, off the top of my head, as Marx explains it in Capital. But I think it's enough to illustrate that surplus value and therefore exploitation is inherently built into the wage rate under capitalist relations of production, as follows:

W = APP x p - s

where W is wage rate per hour, APP is average physical product in the industry (at a value of 5), p is price of product (at a value of $10) and s is surplus value (at an arbitrary value of $40). If p or APP (i.e. general productivity) changes, W changes, but s is still there.

A firm's profit is calculated by:

π = TR - TC

where TR is total revenue and TC is total cost. W is a component of TC. π can become negative if TR falls or TC increases or both. TC can increase because of an increase in W. But these changes would not necessarily eliminate s. The only way for s to disappear is if p falls so low that for W to remain at a tenable level, s has to be eliminated.

Assuming the minimum that a worker can live on is W = $5 and if p = $1,

W = APP x p - s
$5 = 5 x $1 - s
s = $5 - $5
s = 0

If p = $0.50

$5 = 5 x $ 0.50 - s
s = $2.50 - $5
s = -$2.50

Only under such a condition is exploitation reversed.

Do you see what I mean now?

 

[Lone Wolf]

and all land would be owned in common(as it was for the majority of human history), the rights of it given to whoever was using it at a particular time. This would result in workers no longer having to rely on producing for other people, using other people's resources in order to secure their livelihoods.

I don't see the relation between communal ownership of land and workers no longer having to use other people's resources in order to secure their livehoods.

Anyway,

Are Capitalistic Social Democrats more dangerous to the Red cause then Libertarians?

Are there any pseudo-leftist or ultra-leftist groups that are sponsored by the CIA is order to divide the Leftist movement?

 

[civver_764]

I don't see the relation between communal ownership of land and workers no longer having to use other people's resources in order to secure their livehoods.

Uhm because then the resources and factories wouldn't be owned by anyone in particular.

Are Capitalistic Social Democrats more dangerous to the Red cause then Libertarians?

Clearly. But I'd still rather have the social democracy.

 

[ParkCungHee]

Besides, as the saying goes: when everyone is a capitalist, no one is a capitalist.

I invented a saying?