My stance on the concept. by Van Bryant, II
(libertarian)
Friday, November 25, 2011
This article is a response to the following youtube video, Marx - Surplus Value "Explained in 1 Minute by user "Sociology in Brief." The video is just over a minute long, so with small edits for clarity, the majority of the user's words are quoted below:
"The concept is based on an employee not being paid the correct, fair amount for their work.
For example: A "sweat-shop" worker may be paid $1 an hour. In this hour they (the worker) may create clothing which is sold for the profit of $100.
The point is, that $100 are made from that worker's hour, although they only see $1 of this. This is taking into account the raw materials to create the product in the first place. Thus, the employer extracts maximum profit from the worker and extracts the worker's value per hour.
Some may argue that this is 'natural' in Capitalism, however $1 an hour is barely viable to live on - and systematically creates a huge gap in wealth from employer to employee."
First, this theory assumes that the product created by the employee is bought before it is even created. In reality, the employer is creating product to compete on a free market. Hundreds, thousands, millions of individuals decide whether or not they want the product. There is no guarantee the product will be sold. If the product isn't purchased, the employer has lost money in the deal: costs for acquiring the materials and labor to create the product. What once sounded like $100 profit is now a loss. When you consider things this way, it is easy to recognize an advantage the employee has over his or her employer. The only person who is guaranteed any profit in the employer-employee relationship is the employee.
Not only is the employer at the mercy of a fickle market, but the employer has to consider competition. If the original employer's product does sell at $100 profit per product, others will take notice and compete to make similar profit. These new employers may be able to locate materials for cheaper, offering a product at lower prices while still making $100 profit. Perhaps competitiors would offer the clothing at lower price, gaining less profit but attracting more customers ("we make it up in volume!"). Maybe the new employers would offer higher wages to attract the better quality laborers, or to advertise their product as "not made in sweatshops" or "guilt free!" The original employer would find himself forced to lower his prices and raise his wages if he hopes to sell product and keep his shop running.
The surplus value as presented above is a strawman, presenting an impossible enviornment of static markets and no competition. Only in this unrealistic scenario can the employer truly be considered a villain: in the real world he is risking his livelihood while enriching others. The "large gap" between successful employers and employees is well-deserved: employees do not risk their wealth in the manner the employer is doing or has done. An employee can find new work at any time, accepting better wages and conditions. The employer is guranteed nothing, and has to compete to earn his or her profits.
There is no "correct" or "fair" wage, only what competition and market conditions create. To consider otherwise is foolish. Human beings, no matter the classification or situation, have no guarantee to prosperity. Only through mutual cooperation and exploitation of our environment can we rise above our natural state of starvation. Statism is the enemy of human progress, the champion of man's natural state. The Marxian statism of inferior, jealous, unprincipled people is no different.
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