For many people nowadays, their own brain is their means of production, often assisted by computers and their software, but those are cheap compared what what can be earned by using them. Marx did not know of such things, of course, but how do modern Marxists view this type of private ownership of means of production? For that matter, how did Marx view a village cobbler who owned his workshop and all his tools? Hated exploiter of his neighbours? How narrow was his motte here?
I once talked about this with a guy who identified as a Marxist, though I can’t say how much his opinions are representative for the rest of his tribe. Anyway… he told me that in the trichotomy of Capital / Land / Labor, human talent is economically most similar to the Land category. This is counter-intuitive if you take the three labels literally, but if you consider their supposed properties… well, it’s been a few decades since I studied economics, but roughly:
The defining property of Capital is fungibility. You can use money to buy a tech company, or an airplane factory, or a farm with cows. You can use it to start a company in USA, or in India. There is nothing that locks money to a specific industry or a specific place. Therefore, in a hypothetical perfectly free global market, the risk-adjusted profit rates would become the same globally. (Because if investing the money in cows gives you 5% per annum, but investing money in airplanes gives you 10%, people will start selling cow farms and buying airplane factories. This will reduce the number of cow farms, thus increasing their profit, and increase the competition in the airplane market, thus reducing their profit, until the numbers become equal.) If anything is fungible in the same way, you can classify it as Capital.
The archetypal example of Labor is a low-qualified worker, replaceable at any moment by a random member of the population. Which also means that in a free market, all workers would get the same wage; otherwise the employers would simply fire the more expensive ones and replace them with the cheaper ones. However, unlike money, workers are typically not free to move across borders, so you get different wages in different countries. (You can’t build a new factory in the middle of USA, and move ten thousand Indian workers there to work for you. You could do it the other way round: move the money, and build the factory in India instead. But if there are reasons to keep the factory in USA, you are stuck with American workers.) But within country it means that as long as a fraction of population is literally starving, you can hire them for the smallest amount of money they can survive with, which sets the equilibrium wage on that level. Because those starving ones won’t say no, and anyone who wants to be paid more will be replaced by those who accept the lower wage. Hypothetically, if you had more available job positions than workers, the wages would go up… but according to Malthus, this lucky generation of workers would simply have many kids, which would fix this exception in the next generation. -- Unless the number of job positions for low-qualified workers can keep growing faster than the population. But even in that case, the capitalists would probably successfully lobby the government to fix the problem by letting many immigrants in. Somewhere on the planet, there are enough starving people. Also, if the working people are paid just as much as they need to survive, they can hardly save money, so they can’t get out of this trap.
Now the category of Land contains everything that is scarce, so it usually goes to the highest bidder. But no matter how much rent you get for the land, you cannot use the rent to generate more of it. So, in long term the land will get even more expensive, and a lot of increased productivity will be captured by the land owners.
From this perspective, being born with a IQ 200 brain is like having inherited a gold mine, which would belong to the Land category. Some people need your for their business, and they can’t replace you with a random guy on the street. The number of potential jobs for IQ 200 people exceeds the number of IQ 200 people, so the employers must bid for your brain. But it is different from the land in the sense that it’s you who has to work using your brain; you can’t simply rent your brain to a factory and let some cheap worker operate it. Perhaps this would be equivalent to a magical gold mine, where only the owner can enter, so if he wants to profit from owning the gold mine, he has to also do all the work. Nonetheless, he gets extra profit from the fact that he owns the gold mine. So it’s like he offers the employer a package consisting of his time + his brain. And his salary could be interpreted as consisting of two parts: the wage, for the time he spends using his brain (which is numerically equivalent to how much money a worker would get for working the same amount of time); and the rent for the brain, that is the extra money compared to the worker. (For example, suppose that workers in your country are paid $500 monthly, and software developers are paid $2000 monthly. That would mean that for an individual software developer, the $500 is the wage for his work, and $1500 is the rent for using his brain.) That means that extraordinarily smart employees are (smaller) part working class, and (greater) part rentier class. They should be reminded that if, one day, enough people become equally smart (whether through eugenics, genetic engineering, selective immigration, etc.), their income will also drop to the smallest amount of money they can survive with.
As I said, no idea whether this is an orthodox or a heretical opinion within Marxism.
IANAM[1], but intuitively it seems to me that an exception ought to be made (given the basic idea of Marxist theory) for individuals who own means of production the use of which, however, does not involve any labor but their own.
So in the case of the village cobbler, sure, he owns the means of production, but he’s the only one mixing his labor with the use of those tools. Clearly, he can’t be exploiting anyone. Should the cobbler take on an assistant (continuing my intuitive take on the theory), said assistant would presumably have to now receive some suitable share in the ownership of the workshop/tools/etc., and in the profits from the business (rather than merely being paid a wage), as any other arrangement would constitute alienation from the fruits of his (the assistant’s) labor.
On this interpretation, there does not here seem to be any contradiction or inconsistency in the theory. (I make no comment, of course, on the theory’s overall plausibility, which is a different matter entirely.)
For many people nowadays, their own brain is their means of production, often assisted by computers and their software, but those are cheap compared what what can be earned by using them. Marx did not know of such things, of course, but how do modern Marxists view this type of private ownership of means of production? For that matter, how did Marx view a village cobbler who owned his workshop and all his tools? Hated exploiter of his neighbours? How narrow was his motte here?
I once talked about this with a guy who identified as a Marxist, though I can’t say how much his opinions are representative for the rest of his tribe. Anyway… he told me that in the trichotomy of Capital / Land / Labor, human talent is economically most similar to the Land category. This is counter-intuitive if you take the three labels literally, but if you consider their supposed properties… well, it’s been a few decades since I studied economics, but roughly:
The defining property of Capital is fungibility. You can use money to buy a tech company, or an airplane factory, or a farm with cows. You can use it to start a company in USA, or in India. There is nothing that locks money to a specific industry or a specific place. Therefore, in a hypothetical perfectly free global market, the risk-adjusted profit rates would become the same globally. (Because if investing the money in cows gives you 5% per annum, but investing money in airplanes gives you 10%, people will start selling cow farms and buying airplane factories. This will reduce the number of cow farms, thus increasing their profit, and increase the competition in the airplane market, thus reducing their profit, until the numbers become equal.) If anything is fungible in the same way, you can classify it as Capital.
The archetypal example of Labor is a low-qualified worker, replaceable at any moment by a random member of the population. Which also means that in a free market, all workers would get the same wage; otherwise the employers would simply fire the more expensive ones and replace them with the cheaper ones. However, unlike money, workers are typically not free to move across borders, so you get different wages in different countries. (You can’t build a new factory in the middle of USA, and move ten thousand Indian workers there to work for you. You could do it the other way round: move the money, and build the factory in India instead. But if there are reasons to keep the factory in USA, you are stuck with American workers.) But within country it means that as long as a fraction of population is literally starving, you can hire them for the smallest amount of money they can survive with, which sets the equilibrium wage on that level. Because those starving ones won’t say no, and anyone who wants to be paid more will be replaced by those who accept the lower wage. Hypothetically, if you had more available job positions than workers, the wages would go up… but according to Malthus, this lucky generation of workers would simply have many kids, which would fix this exception in the next generation. -- Unless the number of job positions for low-qualified workers can keep growing faster than the population. But even in that case, the capitalists would probably successfully lobby the government to fix the problem by letting many immigrants in. Somewhere on the planet, there are enough starving people. Also, if the working people are paid just as much as they need to survive, they can hardly save money, so they can’t get out of this trap.
Now the category of Land contains everything that is scarce, so it usually goes to the highest bidder. But no matter how much rent you get for the land, you cannot use the rent to generate more of it. So, in long term the land will get even more expensive, and a lot of increased productivity will be captured by the land owners.
From this perspective, being born with a IQ 200 brain is like having inherited a gold mine, which would belong to the Land category. Some people need your for their business, and they can’t replace you with a random guy on the street. The number of potential jobs for IQ 200 people exceeds the number of IQ 200 people, so the employers must bid for your brain. But it is different from the land in the sense that it’s you who has to work using your brain; you can’t simply rent your brain to a factory and let some cheap worker operate it. Perhaps this would be equivalent to a magical gold mine, where only the owner can enter, so if he wants to profit from owning the gold mine, he has to also do all the work. Nonetheless, he gets extra profit from the fact that he owns the gold mine. So it’s like he offers the employer a package consisting of his time + his brain. And his salary could be interpreted as consisting of two parts: the wage, for the time he spends using his brain (which is numerically equivalent to how much money a worker would get for working the same amount of time); and the rent for the brain, that is the extra money compared to the worker. (For example, suppose that workers in your country are paid $500 monthly, and software developers are paid $2000 monthly. That would mean that for an individual software developer, the $500 is the wage for his work, and $1500 is the rent for using his brain.) That means that extraordinarily smart employees are (smaller) part working class, and (greater) part rentier class. They should be reminded that if, one day, enough people become equally smart (whether through eugenics, genetic engineering, selective immigration, etc.), their income will also drop to the smallest amount of money they can survive with.
As I said, no idea whether this is an orthodox or a heretical opinion within Marxism.
IANAM[1], but intuitively it seems to me that an exception ought to be made (given the basic idea of Marxist theory) for individuals who own means of production the use of which, however, does not involve any labor but their own.
So in the case of the village cobbler, sure, he owns the means of production, but he’s the only one mixing his labor with the use of those tools. Clearly, he can’t be exploiting anyone. Should the cobbler take on an assistant (continuing my intuitive take on the theory), said assistant would presumably have to now receive some suitable share in the ownership of the workshop/tools/etc., and in the profits from the business (rather than merely being paid a wage), as any other arrangement would constitute alienation from the fruits of his (the assistant’s) labor.
On this interpretation, there does not here seem to be any contradiction or inconsistency in the theory. (I make no comment, of course, on the theory’s overall plausibility, which is a different matter entirely.)
I Am Not A Marxist.
https://www.marxists.org/archive/marx/works/1847/communist-league/1850-ad1.htm