Recently, a meme from one of Twitter’s many socialist denizens got a lot of attention. The message it seemed to deliver was that workers are undervalued, because they are paid for far less than they produce:
The implication is clear, and is reflective of a popular talking point in socialist circles. The worker in this meme produces 3,000 of those plastic rings with each hour labor but is only paid enough per hour to buy 3 of them. That would imply he’s only being paid for one thousandth of the value of what he produces! Surely this is exploitation, right?
Well, no. There are two big points this meme misses that change the picture quite a bit. The first one is that the worker here can’t actually produce 3,000 of those plastic rings per hour. If he could do that, he’d just set up shop in his garage and make them himself, selling them directly and massively improving his income. He can only make 3,000 per hour because he works with machines built by others and paid for by others. His labor, by itself, isn’t sufficient to produce 3,000 per hour. It requires combining his labor with the massive capital investment the company put forth to make his labor more productive, taking place in the context of a business that also provides him with the work environment, raw materials, and tools, that handles the orders and sales, along with innumerable other aspects that are necessary to enable him to do what he does. In order for that worker to claim he specifically produces 3,000 per hour by his own labor, he has to massively discount and dismiss the labor and investment made by so many other people. His labor is important, sure, but it’s one small step in an incomprehensibly complex process involving the cooperation of countless workers that also go into producing those plastic rings.
As is often the case, the flaw in this kind of thinking was pointed out by Adam Smith, in his well-known (but apparently not well-known enough) description of what ultimately goes into the production of a simple wool coat:
The woolen-coat, for example, which covers the day-labourer, as coarse and rough as it may appear, is the produce of the joint labor of a great multitude of workmen. The shepherd, the sorter of the wool, the wool-comber or carder, the dyer, the scribbler, the spinner, the weaver, the fuller, the dresser, with many others, must all join their different arts in order to complete even this homely production. How many merchants and carriers, besides, must have been employed in transporting the materials from some of those workmen to others who often live in a very distant part of the country! How much commerce and navigation in particular, how many ship-builders, sailors, sail-makers, rope-makers, must have been employed in order to bring together the different drugs made use of by the dyer, which often come from the remotest corners of the world! What a variety of labor too is necessary in order to produce the tools of the meanest of those workmen! To say nothing of such complicated machines as the ship of the sailor, the mill of the fuller, or even the loom of the weaver, let us consider only what a variety of labor is requisite in order to form that very simple machine, the shears with which the shepherd clips the wool. The miner, the builder of the furnace for smelting the ore, the feller of the timber, the burner of the charcoal to be made use of in the smeltinghouse, the brick-maker, the brick-layer, the workmen who attend the furnace, the mill-wright, the forger, the smith, must all of them join their different arts in order to produce them…if we examine, I say, all these things, and consider what a variety of labour is employed about each of them, we shall be sensible that without the assistance and co-operation of many thousands, the very meanest person in a civilized country could not be provided.
In the modern world, the web of activities and labor leading up to the production of those plastic rings is, if anything, incomprehensibly more vast than what Adam Smith describes in the production of a wool coat in the eighteenth century. All of that work, effort, investment, and cooperation is erased from existence by the kind of “reasoning” employed in this meme. While socialists may claim to be the allies of labor, in putting forth claims of this sort, they are ironically devaluing and dismissing the importance of the cooperative efforts of a vast amount of laborers.
