surplus labor value

Labor is a commodity that is bought and sold. I'll buy somebody's time for a salary. Then I try to sell it for more. When this "surplus labor value" no longer exists the labor is no longer employed.

 

... you have loyalty for your plumber? Business is business, you want loyalty — make a friend.



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Couldn't agree more. Every boss I worked for I did a good job, even if I hated him. My brother worked for a fortune 500 company. They decided to liquidate the employee pension plan, returning the employees their contributions. They made over a billion profit on the value of the stock.

I laughed my ass off.

 

Labor is only cost what it does based on it's demand. If a "capitalist" can invest in efficiency with it's capital, then it doesn't need as much labor but can still increase it's product sales world wide. So where did the money go?

 

That's what Marx called it anyway, but he slowly starved to death 120 million humans with his pure surplus value ignorance. The pure beauty of capitalism is that if a boss makes too much surplus value or profit it encourages competition until the profit is reduced to $0. This is why 10,000 bosses go bankrupt each month.

 

The surplus labor value concept was disproven a long time ago. Why people are still kicking this around baffles me. The proof is quite easy: if profits come from extracting the surplus labor value, then why do non-labor intensive industries make similar amounts of profit as high-labor intensive industries? If profits came from extracting surplus labor value, then why would any industry ever utilize labor-saving devices like robots? You'd think they would want more workers instead of more machines because they are supposedly profiting off the workers.

It's all nonsense. Profits do not come from surplus labor value. Profits are actually tied to interest rates. If the profit level is below the market interest rate, then the incentive is to save the money at interest instead of investing in new business. If the profit level is above the market interest rate, then the incentive is to invest it instead of save it. Thus profits tend to follow the market interest rate.

 

I think its because liberal people are not very intelligent and because capitalism seems harsh to them.A system that promises to make life easy tricks their simply minds.

 

well now add the value of the land the factory was built on, the value and depreciation of the equipment, the power cost, the administrative cost and taxes and how much of the 7 is left? then give 35% of that to the government. plus 7.5% of the 3 dollars for social security.

alternatively lets get rid of the factory and now what does the worker do for money?

 

seems wrong since profits com from inventions, and so don't follow interest rates. Great new inventions create huge new profits and have little to do with the interest rates. When interest rates were 20% most businesses didn't fold up and invest at market interest rates and now that interest rates are 0% people are not rushing into business.

 

New inventions can create new opportunities for profits, sure, and they can be quite large--at first. But in a free and open market, competition will come in at lower prices and bring those profit levels down to the market rate.

Regarding interest rates, they are manipulated by the Federal Reserve instead of being set by the free market. We don't know what the prevailing market interest rate would have actually been had the market been allowed to operate. Even so, let's say in a free market interest rates had gone up to 20%. What conditions would cause that to happen? Well, that would mean that people are spending money instead of saving it. A short supply of savings means banks have less to lend out, and as such they can charge higher interest rates due to the law of supply and demand. With consumers spending more money, prices and profits will go up, but there won't be many new competitors entering the field because interest rates are so high. So under the conditions that would create high interest rates, it would also create higher rates of profit. The two go hand in hand.

 

yes but it has little to do with interest rates so you were mistaken when you said profits follow interest, whatever that means..

 

Hand in hand?? You mean they are related? In fact, profits come from new inventions. We got from the stone age to here with new inventions, and interest rates had little to do with it. An inventor would raise money primarily by selling stock thus promising stockholders part of the profit.

 

I'm afraid that is quite likely that we will have to slide into a third world country status for the working class to wake up and really give the power of collective bargaining a real hard look. Only then, can workers improve their earning capabilities and regain rights in the workplace.

 

Shoot! And here I thought we would be discussing the value to the employer to have a large pool of unemployed!

On the other hand in your scenario the worker is less valuable the more you pay him. The more you pay the less you get in profit.

Normally wages get better when there is very low unemployment. With high unemployment even high skilled workers with great work ethic are cheap to come by.

 

of course thats 100% insane and perfectly liberal since we are getting clobbered now with jobs going to lower wage countries. Collective bargaining would cost us 10 million more jobs!! It figures that liberals would propose it!!

 

How so? Why would unionizing cost 10 million jobs? How'd you come to that conclusion?

 

First of all, profits do not come from inventions. People start all kinds of successful businesses that are completely unoriginal. How many pizza places are out there making money that all just do the same thing? This notion that profits come from new inventions is rather bizarre and has no basis in sound economics.

OK. And what amount of profit would be promised? If he promised more than the prevailing rate of interest, he would be giving them extra money for nothing. If he promised them less, they could just lend their money out at the prevailing rate of interest. Once again, I've proven that profits and interest rates go hand in hand. You keep coming up with examples that prove my point.

 

1) We got from the stone age to here thanks to new inventions. Simple enough?

2) the biggest profits come from new inventions since they are most responsible for advancing our standard of living

3) Republican supply side libertarian conservative economics is all about encouraging new inventions or efficiencies.

 

A corporation does not promise an amount of profit to an owners. The owners are legally entitled to 100% of the profits. 1+1=2

 

In a private corporation the owners/shareholders may or may not have rights to the profits.

In a public corporation the shareholders own a value of stock and have no rights to profits.

In a public corporation when they pay dividends this is a promise to share some profits with shareholders...

 

and your point is???

 

Yes but without the Boss, the employee can wipe his ass with the useless widget. Because you see the Boss has made arrangements to sell it to someone, or perhaps invested in marketing that product, or paid for placement in stores... thus without the planning and investing that is required the semi skilled employee has just wasted his time, and wont get paid squat for his labor.

 

of course, the pure and amazing beauty of capitalism is that if the boss extracts too much, competitors will be encouraged to get on board the gravy train until profits are reduced to $0. This is why 10,000 companies go bankrupt every month.

 

You're talking about technology advancing, which is not the same thing as making a profit. By your logic, it would be impossible to make a profit in industries where there has been little to no technological innovation. How do restaurants make a profit? By inventing a new oven? Inventing a new pancake? How do theater's make a profit? Inventing a new spotlight to light the actors? Your assertion leads to silly conclusions and has no basis in sound economics.

My statements are based on well-tested economic knowledge about the role of the capitalist and the connection to the interest rate in society.

Also, you are wrong to say that the biggest profits come from new technology. That is just plain false. Accounting, a very old industry, has some of the highest profits. Real estate businesses have very high profits, yet land is just land. Legal services have very high profits, and I haven't seen too many robot lawyers. Your assertions just don't hold up to any scrutiny.

 

by better food, better location, better service, better ambiance. But restaurants are trivial. We did not get from the stone age to here because of restaurants. we got here because of new inventions. If we want to progress today we need new inventions not new restaurants. Do you understand?