by Joe Siano
Who works hard? Bees and beavers work hard.
Busy bees.
Busy beavers.
Who is a more tireless worker than the
mighty ant? Hour after hour these little
guys lug heavy loads into their labyrinth colonies without stop.
But what do bees, beavers and ants
have to show for millennia of unceasing effort?
Nothing. Their kind has made zero
progress in millions of years. Their lives have not changed a bit. The Galapagos Tortoise is as well off
but does absolutely nothing.
Humans themselves labor unceasingly in
slave and command economies for little more than the bare necessities needed to
work another day.
Why dedicate a major holiday to
“Labor” when it appears to be ineffective in improving the lives of laborers?
Labor is but one of the four economic
factors in the production of “goods”.
Goods are those products, tangible or intangible, that make human life
more enjoyable. The factors are Land,
Labor, Capital and Entrepreneurship.
Land is what God or nature has bequeathed
us. It was once the most important source
of wealth. That is why the warrior class
– kings and nobility – held the land and became wealthy while their workers – slaves, serfs,
peasants – labored for little material gain. As technology and industry surpassed land as key
economic engines, the power, prestige and wealth of the landed aristocracy diminished.
Labor, Capital and Entrepreneurship are
the human factors of production.
Undoubtedly Labor combined with Land produced
the most rudimentary consumption items – basic foodstuffs, shelter from the
elements and clothing.
“Capital” represents the tools that save labor and make labor more productive. Capital
is created by sacrifice and savings, refraining from immediate consumption. These savings are invested to create new tools which further multiply the fruits of
labor. Early examples include the wheel,
oxcarts, plows, fishing nets, millstones and wine presses.
Capital accumulation, that is more
sacrifice, savings
and investment make for better tools and technologies which make for a
materially richer society.
Capital creation also involves risk. What if the new technology does not work as
hoped? What if someone builds a better
mousetrap while you are building yours?
What if the market moves on – consumer tastes change – and you are stuck
with a device that efficiently produces something that no one wants?
This element of risk opens the door
for entrepreneurs and capitalists.
Entrepreneurs are the visionaries who see
a societal or human need that is not adequately met and envision a profitable solution
to meet that need.
Capitalists assume the risk of
underwriting entrepreneurial visions by investing their savings (deferred
consumption) to transform dreams into real goods and viable businesses. Sometimes they succeed. More often, they fail. To
compensate for the many failures that he may endure, the professional capitalist
looks to win big with his successes.
The material progress of society is
not so much driven by Labor as it is by:
·
Sacrifice – deferred consumption
– to accumulate resources for investment
·
Capital accumulation –
a sufficient pool of “surplus” wealth to invest in risky but potentially useful
new ideas
·
Entrepreneurs – people
with the insight, imagination and inventiveness to propose new tools to improve
lives
·
Capitalists – risk-takers
with the resources and stomach to make big bets on speculative endeavors
These entrepreneurs and capitalists create the companies, build the plants and the infrastructure to employ
legions of workers ranging from highly paid executives and techno-wizards all the way through to clerks, janitors and laborers.
Each of these people contribute value to the enterprise and are rewarded accordingly. However, the
enterprise in which they work would never exist without Capital Accumulation,
Entrepreneurial visionaries, and Capitalist investors.
The idea of Labor
Day is a socialist contrivance, based upon the erroneous Labor Theory of
Value. The Labor Theory of Value holds
that the value of a product is determined by the time and energy invested to make
a product. This is absurd. If I were to
invest a year of my life building a house that falls down or a car that does
not run – they are worthless despite my earnest efforts.
Value exists only in the buyer's eyes. Value creation consists of solving consumer problems or meeting their needs. A successful business is one that can do so profitably.
Socialism has nothing to say about how
goods are produced or consumer needs met. Its sole concern is
with the distribution of proceeds. Thus,
it is unsustainable. Without an eye on
producing consumer value, there will soon be no proceeds to distribute.
Only a decentralized
and free market society can create the conditions that have produced
near-universal access to automobiles, air-travel, cell phones, indoor plumbing,
TVs, computers, refrigerators, washers, dryers – you name it. Only under the regime of private property and
privatized reward and loss will humanity thrive.
The condition of having decentralized governance
and free markets is called Liberty.
It is Liberty, not Labor that that is
the kernel of human advancement.
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"Half
the people are stoned and the other half are waiting for the next election.
Half the people are drowned and the other half are swimming in the wrong
direction."
- Paul Simon
