Date: Fri, 29 Oct 1999 01:32:54 -0700 (PDT)
From: Jamal Hannah <jah-AT-iww.org>
Subject: Exploitation and How it Affects You - An Anarchist Perspective


Here is an article on exploitation and surplus value, from an anarchist.
You can constact him at bakunin-AT-anarcho.zzn.com  ... if you want to
use this text in a published article or a pamphlet, that would be great.
Please repost this message widely and/or place it on your web site.

--------------------

Exploitation and How it Affects You
By Brian Oliver Sheppard

The exploitation of working men and women is one of the basic features of
the American economy. It is also one of the features inherent to any
economy that is "free market" - a term I'll use loosely to refer to
economies characterized by profit-driven firms that employ workers and pay
them wages or salaries in exchange for labor. That exploitation is an
economic fact is not as dramatic a proposition as it may seem at surface
level. Indeed, most workers intuit or suspect they are being used but there
are a host of theories and explanations that right thinkers offer that
insure potential subversives are agreeably placated. The media treat wage
and salary work as simple facts of day to day existence, so it doesn't seem
reasonable, much less productive, to challenge these pervasive institutions.
So what kind of "exploitation" am I referring to, and why is it bad?

First I will mention one type of exploitation that I will call
"exploitation by moral standards." This is not the type of exploitation I
am most concerned with here, but understanding it will show how a more
pervasive form of capitalist exploitation acts to deceive and rob workers.
Exploitation by moral standards occurs when a relatively privileged or
powerful individual uses relatively powerless people to further his or her
own interests, which are usually the interests of wealth and thus of more
power. Those who are powerless are driven by necessity to place themselves
in the service of more powerful persons so that they might receive a wage
with which they can live. The less powerful person may be reassured, by
those eager to attain the good favors of the powerful, that he or she is
freely choosing servitude and employment, and thus is party to a
transaction that is representative of liberty, equality, and all sorts of
other wonderful things. However, the relatively powerless person who must
rent himself out to the more powerful person will rightly regard his choice
between 1) toiling for another, and 2) starvation, as a bitterly insulting
notion of "liberty." It is not hard for even the most rabid defender of the
status quo to see that an employer who sends children to work at
less-than-legal wages is exploiting them, even if the children "freely
chose" to work at such wages. Employers who enrich themselves off the labor
of children, the indigent, the elderly, and/or the mentally challenged may
indulge in self-congratulation and say they are "providing jobs" for those
otherwise unemployable. But our social morality by and large is such that
we also detest bosses whose bread is earned off the backs of those who are
more in need of nurturing and protection than they are in need of making
others wealthier.

Exploitation by moral standards can be found in child labor, sweatshop
labor, and in modern indentured servitude (companies who employ people -
usually immigrants or other legally vulnerable people - with the intent of
making their workers all the more indebted to the company and thus bound to
it for ever longer terms). We see such things as morally wrong. They are
wrong because our beliefs in human dignity and freedom are such that we
find it detestable for people to take advantage of the poverty or innocence
of others. People that see in others merely an economic use, a means to
their own material enrichment, are rightly held to be vultures or
parasites, unworthy of our respect. We don't want friends who value us only
inasmuch as we might help them get ahead socially or in their careers, and
we don't put a high moral value on those who see in other humans only a
means to make their business more profitable.

This type of exploitation is easier to perceive and protest than is a
second and more insidious type of exploitation, which I will refer to as
"technical exploitation." Exploitation by moral standards stands out most
noticeably against a backdrop of poverty and human misery. On the other
hand, a white collar professional may be employed in the service of a
company that sees him or her also as merely a means to a financial end, but
it is harder to find this unacceptable if the professional is making a high
salary and is apparently content with his or her job. Although the number
of people satisfied with their jobs is spiraling downwards, let us assume
all middle class (and above) workers are happy to be working where they
are. They do not "feel exploited" and might regard it as ridiculous if
anyone were to suggest so. Fine - for the sake of argument, we will agree
that they are not being exploited by moral standards, and can forget trying
to prove that they are. There is, however, an exploitation occurring in a
more technical sense. It can be shown with simple logic. This type of
exploitation occurs in all jobs - no matter the pay - wherein one is
working to produce a profit for another. It is up to workers everywhere to
decide, once given information about technical exploitation, whether they
think the sleight of hand they are subjected to is worthy of their further
participation.

Quite simply, workers are tricked into working a portion of their time for
free. They are tricked into doing this by their employer and by the
government, whose logic will not admit to this. All we have to do to see
the nature of this type of exploitation is ask this: If every employee were
reimbursed the exact monetary value of his contribution to the firm s/he
worked for, would there be any profit left over for the company? The answer
is no. Remember, a profit is the money left over after everyone has been
paid and after all other company expenses have been covered. Revenue and
wealth are generated by workers for the company - that is why they are
employed - and the money "left over" after they are compensated is the
profit. But, if the workers generate the wealth - as they do - and then are
reimbursed wealth equal to their value - as bosses say they are - how could
there be anything "left over"? If I work ten hours and generate $10 of
wealth for a company, shouldn't I be paid $10? That amount of pay would be
equal to the value of my labor. But if I were paid the full $10 there would
be nothing left over to count as profit. The entire value of my
contribution would return to my pocket, after the product of my labor had
been sold on the market. Therefore, I must be tricked into being paid less
than what my labor is worth if there is to be a profit left over for my
employer.

Here is another example. Let's say I work at a chocolate factory. I produce
50 candy bars per day. On the market these candy bars fetch a total of $100
per day. This means, in effect, that I generate $100 a day in wealth for
the company. If I were paid a wage that was equal to my contribution, I
would get $100 a day. But if I were paid this much, there would be nothing
left over for my bosses to keep for themselves. What they keep is the
"profit" - and if they cannot generate this they will downsize the company
or go out of business. What my bosses do, then, is pay me less than what my
labor is actually worth to them. If it is expected that I will generate
$100 a day in wealth, I will get paid, say, $70 per day, depending on how
much profit they are looking to generate. The goal is to pay me as little
as possible in proportion to how much wealth I can generate for them. If I
get paid $70 per day while generating $100 for the company, then what this
means is that the time I spent generating the $30 I never see is unpaid
labor time. This unpaid labor is the source of profit. And since it is the
source of profit, it is the source of the capitalist system.

We can also look at it another way. If I get paid a wage of $9 an hour,
what this means is that I am generating at least $9.01 per hour for the
company, if the company wants to turn a profit of at least one cent per
hour. Most, of course, want a profit that is much greater than this. So,
while I get paid $9 an hour, I may be generating revenue of $16 per hour.
In an even exchange, I would get paid $16 an hour if that is how much
revenue I generated; but since I "freely contracted" to work at the company
in question for $9 an hour, that $7 an hour is taken from me without any
mention. Of course, when I am hired, I am not told how much wealth it is
expected I will generate. If I were told this, would I be so eager to be
paid less than what I was worth? And if profits aren't up to forecast,
company restructuring is in order, which may include firings and other
things. Employees who aren't profitable to the company aren't hired, or are
fired or shifted elsewhere the minute their job becomes a liability instead
of an asset. Jobs aren't handed out to people unless it is expected that
the performing of such jobs will generate wealth for company owners.
This extraction of surplus value is not recognized by the government or
even by corporations who practice it. This is because, according to law and
corporate policy, any amount of pay you agree upon when hired is considered
a "fair exchange," because you have agreed to it. You wouldn't agree to it
unless you deem it fair - at least, that's the logic of the law. Therefore,
corporations are doing no wrong because all they have done is put an offer
on the table that you have accepted - and if we live in a free market, one
doesn't have to accept such offers, do they? You are free to take your
skills elsewhere. You are free to negotiate with employers until you reach
a settlement that satisfies you. Of course, if profit-driven firms don't
reach agreements that aren't profitable for them, they will cease to be
profitable and thus will fold, and they are not in the business to
self-destruct or to go out of business in the name of fairness. Since the
source of profit is unpaid labor, none will offer to give back to their
workers what is expropriated from them. They can't, or they would go out of
business.

Of course, it seems elementary logic that, if workers at a chocolate
factory are paid a wage that represents an even exchange to the wealth they
generate for the company, then these workers should be able to buy back all
that they produce with their wages. But workers cannot buy back what they
produce because they are paid less than the value of what they produce.
Even service industry jobs are staffed because staffing them means
profitability - the person employed is generating some form of profitable
revenue or else s/he wouldn't be employed. It's just basic business sense
that positions won't be created, much less staffed, that don't lead to
increased profitability for the firm.

The way that right thinkers rationalize the expropriation of value from
their workers is this: workers alone cannot generate wealth for themselves.
They need the tools, machinery, structure, and entrepreneurial leadership
that business owners possess, and because business owners possess these
things, they are justified in demanding such a huge percentage of revenue
for themselves. If the chocolate factory worker has any qualms with not
getting his full $100 per day, he is free to quit his job and make that
$100 per day on his own. But he can't, can he? He needs the equipment - the
capital - that the chocolate company owns. And because the chocolate
company owners own these things, they can rightfully expropriate value from
their employees. The owners of capital - capitalists - realize that workers
need to work with capital in order to realize a wage, so they exploit this
predicament to keep wealth for themselves. The capitalists do no real labor
other than providing lifeless tools or workplaces to workers, but this is
enough to demand that they control the company and all its revenues. The
capital that capitalists provide is naught but the fruit of workers of past
generations; the capitalist has expropriated this to himself and legally
owns it. And since he legally owns it, he will see what line of business he
can apply his capital to that might make him money, and then proceed to
hire workers in the pursuit of that interest.

Is the private ownership of the means of production (i.e. capital)
justification enough to withhold from workers a portion of the value they
generate? To this, anarchist and mutualist Pierre Proudhon stated:
"Capital, tools, and machinery are ... unproductive [without human labor].
The proprietor who asks to be rewarded for the use of a tool or for the
productive power of his land [by keeping and distributing profits made from
the labor generated with them], takes for granted, then, that which is
radically false; namely, that capital produces by its own effort -- and, in
taking pay for this imaginary product, he literally receives something for
nothing." The anarchist Mikhail Bakunin likewise asked: "What is property,
what is capital in their present form? For the capitalist and the property
owner they mean the power and the right, guaranteed by the State, to live
without working [and thus] the power and right to live by exploiting the
work of someone else [namely,] those who are forced to sell their
productive power to the lucky owners of both."

I wish I could say that exploitation costs us so many billions of dollars
per year. One of the quickest routes to curing social ills is to
demonstrate how such ills are a drain on the economy. It is never assumed
that social ills could generate wealth or strengthen economies, though
indeed they often do. Profit, the very source and indicator, supposedly, of
how healthy an economy is, is the result of the deception and exploitation
of workers. Profit is labor for which workers are not reimbursed. Yet the
more that workers are not reimbursed, the more profitable firms become, and
the "healthier" our economy becomes. Workers are not told all they need to
know about how the capitalist system operates, but are instead dazed into a
stupor with flowery rhetoric of free trade, free markets, free this or free
that. Exploitation is at the root of our current economy, and we cannot
speak seriously of living in freedom until it is eliminated.