Explain in detail Marx’s idea that capitalism is unjust because it involves the expropriation of surplus labor, as we have discussed this idea in class. Explain exactly why one might think this is a serious objection. How could a defender of capitalism best reply? Do you think the defender’s reply is convincing? Explain why or why not.
According to Karl Marx, capitalism is apparently the worst form of market system. He notes that capitalism splits people into two distinct social classes. The first class belongs to the proletariats or servants who are charged with the role of production.
These are workers who have been hired to work as per their job specifications. On the other hand, capitalists are owners of the final products. They primarily own the products that have been produced by proletariats or workers. It is also vital to mention that capitalists do not merely own the end products; they also control the entire process of production.
Nonetheless, it is vital to recall the labor theory of value, and also link the theory with the concept of market surplus as argued out by Karl Marx. David Ricardo and Adam Smith originally proposed the labor theory of value in relation to the free market economy. They noted that the amount of labor and the final market value of a product are directly proportional to each other.
In other words, labor creates the value of the product available in the market. Secondly, the value of the labor used to produce the market product is usually lower than the market price of the same product. Karl Marx refers to the difference between the two parameters as the “surplus value”. As a matter of fact, this scenario is typical in cases where there is excess supply of labor and limited job vacancies.
While the above case scenario is common in most economies, a capitalist system usually takes advantage of the surplus labor force. Capitalists usually expropriate or steal the surplus labor due to the support obtained from the contract law. Any surplus value is usually reserved by the capitalist. Workers are only entitled to the terms of service as stipulated in the working contract.
Therefore, workers are compelled to abide by the contract. Therefore, they give away their surplus labor at the benefit of the capitalists. Worse still, the capitalist and the worker do not have equal bargaining power when making such agreements. The worker is usually the loser in such contracts.
A defender of capitalism would obviously cite the power of the law as the legal basis for taking the surplus value from workers. For instance, workers are supposed to abide by the contract terms according to the law of the contracts. This must be taken with serious objection bearing in mind that reaping the surplus value from servants is tantamount to theft. Workers have weaker bargaining powers than their employers (capitalists).
Therefore, such contracts should not morally bind the two parties due to lack of fairness. It is unjust to exploit free labor from workers on the basis of excess supply of the same. Such a capitalist system supports theft and exploitation of those who are already poor while enriching the wealthy individuals. Therefore, arguments that defend capitalism on the basis of law and contracts are not convincing at all as discussed above.