Please read the short essay, or just click the answers to these simple questions. You may need to *enable popups.
1. Why do engineers almost always make higher salaries than factory workers?
a. They socialize with the bosses
b. Engineers are just superior people
c. The value of their labor power is increased by the value of their training
d. They do more important work
2. How could you compute the value of a workforce?
a. Figure out how much they could produce
b. Subtract their wages from their production
c. Average the value of all workers, then multiply by the number in your workforce
e. Figure out what it would cost to replace them
3. Are wages generally commensurate with the value of the labor power being bought?
a. Yes, because competition tends to force wages (prices) in line with value
b. No, because every individual is different
c. No, because workers who speak up will always get more than submissive workers
d. No, because the bosses cannot afford to pay well during hard times
e. Yes, because both the boss and the worker always know what the worker is actually worth
f. No, because people are NOT commodities!
4. When can workers win stable and enduring gains under capitalism?
a. When they join a union and stick together
c. When they realize that politics is everything
d. When they train hard, work hard, and stay out of trouble
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An even more special commodity: Labor Power |
Labor power is the potential for humans to do work. Capitalists buy it from us, usually a week at a time, for what they call a week’s wage. As something that is produced for sale or trade, labor power clearly falls under our definition of a commodity.
All commodities get their value from the average amount of socially necessary labor time needed to produce them. Labor power, then, is valued by the labor that went into its making. That is, the accumulated values of birthing, rearing, transporting, training, and otherwise preparing the workers. Take a moment to absorb that.
Of course, workers aren't created like machines, but the value of their time on the job can be computed in a similar way. If a boss could build a robot to exactly replace a worker, he would base his decision on cost!
Just for an incidental thought, consider that medical doctors get paid a lot more for their labor power than schoolteachers, and schoolteachers get more than janitors, even though none is intrinsically better than the other. Medical doctors, it turns out, have to be trained longer and thus their labor power has more value. Schoolteachers are trained longer than janitors, and thus produce more valuable labor power.
Remember again that we are talking about macro-economics, not specific people or events. The average value of labor power is equal to the amount of socially necessary labor time needed to produce it, or to produce the worker who sells the labor power.
If the value of a worker is his or her replacement value, does their wage tend to equal their worth? In economics, all commodities (don’t forget we’re talking averages) are sold at their value. Consequently, the answer is yes, in a very general sense, the capitalist pays workers their replacement value, or their value.
Capitalists might temporarily pay more or less than value according to market conditions for labor, or for certain kinds of labor. The rules work the same as for other commodities. The ups and downs vary the price of labor power, but always around its value.
Capitalism would not work if capitalists consistently paid workers less than their replacement value, because the workers would die out for lack of subsistence. Marx remarked wryly, “However, they always try!”
Capitalists can and do pay more than replacement value when workers unite and start winning the perpetual class struggle within capitalism. But capitalist competition forces each employer to try to lower labor costs, consequently they must always maintain pressure to cut wages. The workers’ gains, under capitalism, are always temporary and must be won over and over again. Workers will never make stable and permanent gains as long as capitalism is the reigning system of production. Take a minute to absorb that. The word was “never!”
To summarize: labor power is a commodity and obeys the rules of other commodities. Capitalists purchase labor power, on average, at its value. Under capitalism, workers must fight constantly, over and over again, to get anything more than subsistence and training.
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