There is a worldwide yearning for human dignity. The majority of people are disillusioned and have deep questions about the prospects of life under capitalism. It’s easy to play on people’s fears and prejudices and to point fingers at certain groups. In the past, it has been ‘the Jews’, ‘the Irish’, ‘the blacks’, ‘the Poles’ or some other easily identifiable target that was blamed for society’s ills. Imagine what life would be like if capitalism was no more and had been replaced by a genuinely socialist society. Imagine a society in a sustainable ecological balance, with material abundance and social equality, a society where social relations were premised on human solidarity, not capitalist exploitation and competition where people are set against each other, but a world where production for profit, driven by accumulation of capital, has given way to production for use. With the establishment of socialism, for the very first time in history, the greater our knowledge, the greater will be the direct benefits to the majority of society. Our aim in the Socialist Party is to reach out to the majority to create an independent, mass workers movement for socialism. We put forth the socialist case that revolution is the only alternative to more suffering and misery. The working class must emancipate itself. No one can do it for them. We in the Socialist Party cannot function as “social workers” who, instead of advocating that the workers themselves fight for their interests, try to patch up the problems of capitalism and make life a little “better” for the workers. To avoid social, environmental and economic collapse, the world needs to move beyond capitalism. Socialism is where we all put all our resources together and work for the common good of us all and not just for the benefit of the few. We are sharing the wealth within society. We need to stop robbery. We need to free ourselves from this system based upon wage slavery. Capitalism cloaked itself in a libertarian guise by proclaiming that the freedom of the market is the only realistic way to achieve this more general liberty. What we need is economic democracy or we will never be free.
You hear union members and their leaders demand fair pay for work. If you walk into a store and buy something for ten dollars you would expect to get back something worth that ten dollars. You wouldn’t expect to buy a single stick of bubble gum; it would have to be something of the same value. At the same time, you cannot expect to get a brand new iPhone for that money. The labour market works in a similar fashion. Those who are there to make the purchase are the employers, the bourgeoisie, who have capital and are in need of workers to manufacture their products and provide service. Those who seek to be hired, who seek an opportunity to sell their “commodity,” are the workers. This “commodity” that they sell to the capitalist is their labour power. This seems like it could be a fair trade, yet workers continue to demand fairer wages, and the capitalists continue to make higher and higher profits while they refuse these demands. How can this be?
Profits cannot be made from the increasing prices of goods alone, the “free market” rules this option out. After all, if a single capitalist increases his prices, he will soon discover that others sell the same goods of the same quality but for less money. Naturally the majority will go for the cheaper offer and the one selling at a more expensive price will have serious trouble getting rid of his goods and making money. If all the others decide to or are forced to increase their prices, this will affect the single capitalist as well, being that he can’t live off his money alone but has to buy commodities like everybody else. We can conclude that increasing prices can be a temporary means to gain profits for a short time in certain sectors of the economy, but they can never be the sole source of capital.
Let us again consider the labor market. The capitalist invests a certain amount of money to hire the worker $56 for 8 hours of work, a wage of $7 dollars an hour. However, the value of the product of this labor will net his boss $200. So is this extra $144 the work of magic? Of course not. The Marxist Labor Theory of Value explains that value is created by labor power. The amount of spent labor power is measured in time, therefore the value of a commodity is determined by the time necessary to produce it. This means that the value of the worker’s labor power can be measured in the amount of goods and, thus, money he needs to keep himself alive and going, to maintain and restore his ability to work after a long day on the job. Therefore the capitalist is compelled to pay him the bare minimum wage needed for survival (sometimes more, sometimes less), $56 in this example, yet the ratio of the amount needed for the basic maintenance of the worker to the hours needed to earn this much is unlimited. Essentially, the capitalist is able to extract more hours from workers while only compensating them to a minimum and reaping the larger part of the value created by the worker.
In our example, the worker would only need to work for approximately 2 hours and 14 minutes to produce a value of $56, but the capitalist hired the worker for a certain period of time, 8 hours here, and during this time all value produced belongs to the capitalist. The workers are paid not for their labour, but for using their labour power to perform work for the capitalist, and they do so with his means of production. The moment they start working, the product of their labor belongs to their employer, no matter if less (which would most likely get the worker fired) value or more value is produced in that period of time than is embodied in the money the workers have received.
This additional, unpaid labour, is called surplus labour and the value it produces without the worker being compensated for it is called surplus value. The extraction of surplus value from the working class is the basis of the capitalist system. Every capitalist’s goal is to extract as much surplus value as possible as it is the basis of their profit. The only way to press more and more surplus labour from a worker is to either reduce the time he works, to gain capital through investment and/or to increase the time the worker works “for free,” without receiving any payment. To put it bluntly: the higher the wages are for workers, the lesser the profit for the capitalists, and vice versa.
Now the question raised at the beginning can easily be answered: are fair wages possible under capitalism? Can a worker receive the full equivalent of the work he performs in a capitalist society? The answer is no; it is entirely impossible as it would leave no surplus value and thus no profits for the capitalist class, and thus render their existence impossible. It would become obvious that they are superfluous parasites, feeding off of the blood and sweat of the working people and living on the unpaid labor of others. The wealth of a selected minority is based on the exploitation of the majority’s hard work. To expect fair wages under this system is like expecting the abolition of slavery in a slaveholder society, as Marx points out. The moment the slaves are freed, we can no longer speak of a slaveholder society; the moment the working class receives the full value it produced, our society has ceased to be capitalist.