I sometimes get onto these threads with a few comments, and end up writing a screed. This was with this person, Ras Lyon, who I suppose is a rasta-capitalist.
@Mr. Ras Lyon Here’s what you said: “Investors and owners don’t live off of the employees, they live off of the return on the investment they made.”
How is that return created? It’s by the work of the employees. Workers produced the goods or services, the company sold it at a price higher than what it costs to produce, and that profit margin increases the wealth of the company’s owners. That is then turned into the “return on investment”, either as dividends, or as an increase in the company’s assets, and thus, an increase in the equity they own.
Can this profit be created without employees? No. The only exceptions are if it’s a one-person business, and the owner is also the worker, or if the business is owned collectively by all the workers. In the latter case, there’s still some imbalances about which workers contribute to the profit, so some may live off other workers.
If the work is outsourced to another company, then the profit is created by these other employees. Look at what’s happened with the coronavirus – it’s knocked out the workers in a part of China, and production stopped; the stock market has responded by declining.
Also, you say: “This is very simple. Investors want to create (invest) in a business based on a product/idea/service. They may not have the know how to perform or create it, so they front the money to those who can make it.”
How is that not employing workers?
Also, you are describing an entrepreneur or venture capitalist. “Investors” are a larger class of owner, who generally do not invest in newly formed companies, but invest in existing companies that already have a track record for profitability.
When workers “invest”, it’s generally via retirement funds that are controlled by banks or insurance companies, and they invest in larger profitable companies. The amount they make from this investment is modest – getting an annualized 10% return would be remarkable, and people are happy to make 5%.
Many workers also do “own a business”, but it’s a “side hustle” or “hobby” that turns a small profit.
Those who are successful often end up hiring someone to work for them, even before the owner goes full-time into the business, because hiring someone at a lower wage is more profitable than quitting their high-paid job.
The small worker-owner can extract a small profit from a minimum wage worker (or they can hire people online and pay less than minimum wage), while the worker-owner is having a larger profit extracted off their labor, by the bigger company.
The worker-owner probably sacrifices some profit by doing this – still making a profit – but frees up time to scale up the business and produce more goods and services, or hire more employees.
According to bankrate, nearly 40% of workers do other work aside from their primary waged work. They are either working for someone else as an “independent contractor”, or own a small business. Someone is performing work, and the owner is getting a profit.
Also, at no point did I mention slavery, much less conflate it with wage labor. Re-read the comments. YOU were the only one using that argument. YOU claimed I said that, twice. You’re not only not seeing reality, you are constantly fabricating your own illusions, in a constant cycle or rhetorical self-delusion.
In that last part, he accused me of equating slavery and wage labor, when, in fact, he merely wrote, two times, that I was equating slavery and labor. He said that I said it, so many times, he believed himself.
Leave a Reply