Labor in capitalism system Essay


There have been many economic systems in history of the world, all formed out of various ideologies but the most prevalent one has been capitalism. It is a system whereby the means of production are in the hand of private owners and its main aim is profits and more profits. Supply, demand, price, distribution, and investments decisions are determined by made a liberated market governments have little or no authority over the market.

The revenues from the entities are mainly for the owners and little is used to pay wages to workers. “In this system therefore production is done by the employees who use their employer, producing commodities which belong to the employer. Labor is a commodity of production (just like equipment and materials) belonging to the employer” (Daniel 1986, p. 156).

Other economic systems that have been in existence earlier are: feudalism, socialism and communism, all these systems are a little similar but all are completely different from the ideology of capitalism.

Both communism and socialism advocate for equality on ownership of property; property should be under the control of the government and all forms of means of production including labor are to be owned by the state to ensure fairness. These systems have been advocated for by many economic theorists for; example Adam Smith, David Ricardo, Karl Marx, among others.

One of the crucial issues in this system is labour; as said earlier everything in capitalism is determined by the market including labour. People who believe to have unique talents are paid very highly and once they stop being good at the particular job. The rewarding system of capitalism is very mean because some people earn more than they should for example CEO’s will earn more than anyone else in an organization yet he does perform as many tasks as those below him.

Karl max is one of the greatest and most controversial sociologists and economic theorist who existed in the 19th century but his woks have lived on up to date. He is one of the major proponents for the communist system and a radical political philosopher who some considered to be very dangerous. He criticized capitalism in his various works and said that one day socialism will take over from it.

Another major theorist is Adam smith who is considered to be the founder of economics as a science. He integrated social theory with economics and stipulated the way man should live .They both have similar ideologies but politically they are completely different each trying to advocate for the best economic system. Both of them agreed that there would be no consumption without production but their differences were on how production should happen.

Smith believed in division of labour which would involve specialized tasks allocated to people who are good at the tasks. The division of tasks would ensure maximum productivity due to specialization.

“He saw in the division of labor and in expanding markets virtually limitless possibilities for the expansion of wealth through manufacture and trade” (Shaikh 1998, p. 65); and this would only happen if the government did not involve itself with the system instead it should let it free so as to allow the most efficient operations for both private and commercial businesses.

This system was named “laissez-faire” meaning “leave alone” and was sustained by his book “Wealth of Nations”. Smith said that people operating freely for their own benefit would be more productive by creating economic incentives that would contribute to the well being of the society.

He agreed that the system will not satisfy everyone’s needs individually but according to him it will be for the good of the state and that is the most important thing. This kind of labour therefore pointed on specialization of labour and then breaking down of responsibilities into smaller parts .Individuals will be expected to specialize on one task to increase efficiency because workers will not change from one job to the next therefore ensuring efficiency.

This ideology was the sole reason as to why factories, especially the English Victorian industries developed very fast. He said that “the government’s core functions are maintaining defense, keeping order, building infrastructure and promoting education. The government should keep the market economy open and free, and not act in ways that distort it” (as cited by Heilbroner 2000, p. 82). Smith therefore believed in a collective interest of the people not personal interests.

He also said that the price of labour can no longer be measured with the value of the good because the owner of the means to produce the good must also be rewarded the labour must produce to tangible goods and also in surplus for reinvestment. “Smith decided to settle on labor as the source of value: The number of hour’s labor that a good can be exchanged for constitutes its inherent worth” (Heilbroner 2000, p. 103).

Smith also believed labor into productive and unproductive labour and it is worth to note that he believed that agricultural activities were the only form of production. He therefore believed any service related activities were not productive and that they should not be allowed since they were not contributing to the nation‘s prosperity. Some have critiqued him as being greedy and obsessed with production and investment at the cost of human life.

Karl Marx on the other hand was for the system that would ensure equality and that was the responsibility of the state according to him. Marx said that the workers did not like not work under the conditions that the owners of capital provided and hence one day that would have to change hence calling for a socio economic transformation Marx argued that the system alienated people from their work, and they became subject of their products therefore losing their human dignity.

They would view themselves as objects because the commodities they produced were valuable than them. The wages that people would earn are very little too and to avoid starvation then worker has no other option but to accept the payment.

The working conditions are not also good because they toil all day without rest, this leads to both physical and psychological pain and hence the worker dies early living the family in the same position. As technology advances more machines are invented and are even valued more than people and that is humiliating for the worker .People cannot leave the system yet because there is a lot of labour available to be bought at this demeaning price.

Karl Marx was therefore not pleased with such kind of a system and hence he developed a labour theory too that he demeaned fair. He said that for production to take place the worker must be in a position or capacity to produce. “This means that this means that he or she must be clothed, sheltered, fed, rested, among others before he or she will be able to properly complete the job.

Marx stated that the hours it would take society to feed, clothe, and shelter, the worker needs so that he or she is fit to produce” Nicolaevsky & Maenchen 1986, p. 98). Marx also noted that the where we are born matters a lot because some people are born workers while others are born employers and it is not in the human power to change that. Marx therefore put people into two groups bourgeoisie and the proletariat; the bourgeoisie are the owners of capital while the while the proletariat are the workers.

The first class therefore controls production while the other works for them; this gives them the power to control the economy, the authorities which are the government, and also the education system because the intellectuals are paid to qualify the capitalist system. This will therefore keep the working class in their position and the rulers remain in control of every sector. Marx said that in order to change such a system then there is need for the whole system to cooperate.

He said the media, the education system, the ideologists and the governments are the most important players here. He advocated for a system that would take over from capitalism which is communism. “Communism is a classless, stateless society in which the means of production are held in common. In this system, competition is eliminated and everyone has equal access to everything” (Iggers 2005, p. 87).

In conclusion capitalism is a dehumanizing system because the workers are made to believe that they can benefit from the system while in fact it deprives them. They may sometimes save little money but under the system the business collapse any time hence leaving them jobless which leaves them with minimal savings.

The system has been advocated by many even in the current generation and mostly has been deemed as fair but is not. Iggers (2005, p. 54) argues that “Capitalism may use the language of human rights, but it only really respects the right of the weak to starve in the gutter, and the right of the strong to keep them there.

Socialism understands rights more widely and fully, and provides for the right to work, the right to an education, and to health care free at the point of use. It cannot be right for a few individuals to block the progress of all towards these great goals.” The two theorist’s works have been highly recognized by the sociological and economic fields although they both held different views they were all valuable.

Reference List

Daniel L. 1986. The Scientific Marx. Minnesota: University of Minnesota Press.

Heilbroner, R. & Milberg, W. 2002. The Making of Economic Society 11th edition. Upper Saddle River: Prentice Hall.

Heilbroner, R. 2000. The Wordly Philosophers. London: Penguin books.

Iggers, G. 2005. Historiography: From Scientific Objectivity to the Postmodern Challenge. Minneapolis: Wesleyan University Press.

Nicolaevsky, B. & Maenchen, O. 1986. Karl Marx: Man and Fighter. London: Penguin Books.

Shaikh, A. 1998. The Empirical Strength of the Labour Theory of Value” in Conference Proceedings of Marxian Economics: A Centenary Appraisal. London: Macmillan.

Labor in capitalism system

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