How Capitalism Steals From You – Labour Article
Jeff Bezos has every reason to feel rather chuffed. On 20 July, the richest man on the planet saddled up, put on his 10-gallon hat and reached the last place uncorrupted by capitalism: space. While I am a cynic and could think of a billion other, more useful uses of time and money, Jeff’s achievement is nothing to be scoffed at.
The founder and CEO of Amazon reached the edge of outer space in a ship in which he contributed $5.5 billion to finance. This ‘billionaire space race’ saw Bezos competing with similarly wallpaper paste personalities, Richard Branson and Elon Musk. While my colleagues debate what the ‘billionaire space race’ will mean for humanity, I want to focus on a quote from Bezos on returning that has garnered some controversy:
“I also want to thank every Amazon employee and every Amazon customer because you guys paid for all of this.”
This quote gives us a good opportunity to talk about Capitalism versus Marxism. What Jeff was referring to – inadvertently or not – is a common practice that happens to hundreds of companies, no matter the size.
Let’s say that I have a large kitchen and the ingredients to make dog biscuits. I don’t know how to make and pack dog biscuits so I hire you and a team of people to make the dough, press it into little bone shapes and package it up. Great! You and your team divide the labour up between you and you’re super productive making biscuits and I take you out for pizza parties and we’re all happy.
By the time payday comes around we’ve made £6000, £2000 of that is for the ingredients and the kitchen costs and I pay the team their socially accepted wages of £2000. I have £2000 to pocket and spend how I want, this is ‘surplus value’.
Now, I could pay you the remaining £2000 for your labour. After all, you spent your time turning my investment into three times its value. But, if I pay you fairly I’ll get competed out of the market by someone who would undercut me, so all that value is mine even though I couldn’t do it without you.
The truth is that this relationship plays out across cities, counties, countries and across the globe. Exploitation of labour-power means there is a class of people who own the means of producing goods and services and there is the class that exchanges their labour to survive. Our global market is more competitive than any other time in human history. It is a race to the bottom of extracting the most value for time at the lowest cost.
Exploitation is at the heart of capitalist systems everywhere. One only has to look at the total value in minimum wage violations in the United States, which is higher than all of the value of robbery, burglary, larceny, and auto theft in the country combined. Or the collective 2 billion unpaid hours put in by workers in the UK over a year.
A system motivated by the pursuit of profit cannot be a wholly good system because the encouragement of accumulation comes at the cost of human and environmental health. It is not a question of whether Jeff Bezos or anyone else in his position is evil. But our system results in the position of capitalists depending upon what new depths they are willing to reach in return for profit.
What is the solution? In a sentence: a world without private ownership of capital. A world where every working person is paid their fair share and no one is forced to either work or starve. A world that is, I hope, possible one day.
However, in the present, we can only spend our time educating people about the nature of the capitalist system we live in. You are not immune to this exploitation. The social contract in society is that you are employed at a workplace because you can produce more value than the employer will pay you. This is the case at every job you work at that will turn a profit.
In the system, no one is paid what they are worth. All profit is value extraction, meaning all profit is theft from you.
Written by Senior Labour Writer, Joseph McLaughlin
Point of Information
Capitalism and CEO Profit are Essential – A Conservative Response
As probably expected, I cannot get behind my colleague’s claim that “all profit is theft.” Yes, within capitalism, owners of particularly large businesses have the opportunity to exploit their workers in horrific ways. But the notion that all profit made is theft from workers baffles me.
CEOs deserve their salaries.
My colleague’s analogy of dog biscuits misses out on many aspects of running a business. Joseph fails to recognise the fact that the CEO in his analogy has come up with the business idea; has sourced the ingredients and kitchen; has created a brand; they have networked. This is just a tiny snippet of the CEO’s role in Joseph’s analogy. When we are looking at the CEOs of much larger companies, like Bezos, this does not even scratch the surface.
The CEO ultimately does a lot more than simply “running a business”. With the ever-changing market, CEOs have to be on top of the financial market. This itself is a skill. It is not simple. The CEO drives the growth of the company. People regularly underestimate just how much work goes into being a CEO. It is 24/7. To accuse CEO’s who profit from a company that is rightfully their own of stealing from workers is really quite ridiculous.
Of course, there are instances where workers are paid below minimum wage. This is illegal for a reason. As Joseph notes, employees are not always treated correctly. There is an increasing level of employee exploitation. I do not, however, see how “a world without private ownership of capital” equates to “every working person [being] paid their fair share”. I do not see how this fixes the problem.
It seems to me that the most logical solution would be for the government to tighten up on the way that they enforce workers rights. There should be no excuse for any company to not follow existing legislation. It should be made significantly more difficult, if not, impossible, to get away with any kind of exploitation.
Written by Senior Conservative Writer, Rebecca Selt
Jokers to the left of me, clowns to the right, here I am ‘stuck in the middle with you’ – A Liberal Response
Joseph’s articles are always my favourite to read. Their optimism and the drive behind their beliefs is what POI is all about. However, we once again differ over the solution while agreeing on the problem, and is, therefore, the joker to my left.
Firstly, Joseph’s article is incredibly simplistic. I know they are personally limited on what they can write with regards to word count, but it is the simple argument of ‘it’s unfair’. There are wealthy people, unfortunately. It is sad that money drives the world, but the scenario Joseph describes is not capitalism. What Joseph talks about is a feudal society. Wealthy person A has all the money; land and kitchens and the workers have no other option. Therefore, they have to work in person A’s kitchen.
Where it is supposed to be different is worker A knows what he is doing. They know they can run a company and make biscuits on their own, they know they can do it better than wealthy person A. So, they go to wealthy person B for a loan and investment and start their own business. As they know more, they make better biscuits and are driven to run their company, they beat the competition. Of course, wealthy person B does make some money, but there is still a risk they could lose it on that investment. Healthy competition with the best person and best investment coming out on top.
However, this no longer happens and this is the problem. Firstly, worker A cannot get an investment. It is too difficult a market to challenge today. The amount of money required to get off the ground is too much now and they have no option but to work for wealthy person A. The option of ‘going it alone’ is not there for them. The option for challengers to come to the marketplace doesn’t exist.
Also, the marketplace doesn’t exist anymore, as it is owned by companies. Amazon with its stupid amount of wealth makes it such an uneven competition that they can walk into any market and either buy their competition or just pump in an absurd amount of money on advertising. This makes it easy for them to win and own a monopoly over it.
To add to all that, they even own what you can see at the marketplace. Amazon will sell you their products first and better products are lost in the pages you have to scroll. It is the same with Netflix. Ever noticed how you will always see their shows first?
The problem is we are at the end of a game of monopoly. Jeff Bezos, or Apple, or Google, or Disney, own the whole board. There are no houses to be bought, no more £200 from the bank, and we just keep rolling waiting to land on that hotel. It is not the capitalist system that it should be.
Those who favour capitalism need to wake up and realise the problems that a long period of capitalism has caused. It is not to say capitalism is bad. I personally think it is far better than Joseph’s solution. But we need to wake up and actually regulate the market and make it healthy and fair again before it’s too late.
Finally, the clown to my right. CEO’s are not paid what they deserve. I do not have enough words to say why, all I can do is recommend reading ‘The Luck of the CEO’ which shows why CEO’s usually have no clue what they’re doing. Also, the fact CEO’s have seen an over 350% increase in recent years while workers wages stagnate shows that the wealth is just sticking at the top, not that they are better.
Written by Senior Liberal Writer, Max Anderson
I am a third year student studying English and Film Studies at the University of Exeter. After completing my degree, I will be converting to law to begin my journey of becoming a commercial lawyer. As an avid reader of the Financial Times, I have begun to understand how important the commercial market is in forming global politics.
I am currently in my second year of reading Politics at the University of Exeter. My first interaction with politics was at the tender age of four years old.