Capitalism Is Unfair and Unethical from a Material Perspective
I’ve had a fairly substantial shift in perspective and political philosophy in the recent weeks thanks to the influence of left-wing friends, the writings of Karl Marx, and mostly my own independent stream of thought.
I came to the realization that profit and the perpetual return on capital is inherently unjust. If we change our lens from that of money, property, and mutually agreed upon contracts to material production and consumption, we find that there are gross and unjust inequities in the distribution of consumption and wealth. A quarter of produce is rewarded on the basis of capital ownership as opposed to labor.
Over 160 million Americans work a combined 300 billion hours each year for the maintenance of their material subsistence. More than half work overtime, and millions do not have the opportunity to work at all.
In the first quarter of 2019, the net operating surplus of all business in the United States (or profit) reached nearly $5.1 trillion. The Bureau of Economic Analysis defines net operating surplus as the following:
A profits-like measure that shows business income after subtracting the costs of compensation of employees (received), taxes on production and imports less subsidies, and consumption of fixed capital (CFC) from value added, but before subtracting financing costs and business transfer payments. Consists of the net operating surplus of private enterprises and the current surplus of government enterprises.
Since gross domestic income reached nearly $21 trillion in the first quarter, this means that nearly one-fourth of all value created in the United States belongs to shareholders, landlords, partners, and proprietors in the form of profit. Nearly all of this profit while be taxed at lower rates from regular wage and salaried income earned by the overwhelming majority of Americans, who must make a living by selling their labor.
This net operating surplus is larger than the economies of Canada and Mexico put together, accounting for roughly an entire $30,000 for every member of the American labor force. Net operating surplus as a percentage of gross domestic income only fell below 20% once in the past 60 years, in the second quarter of 1980, when it fell to 19.5%. This stream of profit, in proportion to all income, has not been declining over the long-run.
In effect, there are people who by no virtue of their own, may consume in plenty and excess, the fruits of the labor of people who do not have the good fortune of possessing capital. It is true that most capital is owned by the upper middle class, and that most capital is accumulated via saving and then investing; however, the average investor can compound the value of their wealth beyond what they would ever be able to save.
Let’s say for example that an investor who earns $90,000 a year saves and invests $12,000 after taxes. If they do that each year and average a 7% return after inflation, they will have just over $1.1 million in 30 years. Over these years, they will average nearly $40,000 in unearned income annually. A capitalist with $1 million can reliably make $60,000-90,000 a year with little or no labor, depending on how they are investing.
Capital carries through the generations in families like mine, allowing them to accumulate unreasonable wealth which perpetually grows, providing for the few a lifestyle incommensurate with their merit or material productivity, all whilst millions live without material security, tertiary education opportunities, or full health insurance.
The Declaration of Independence reads the following, “We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.” It is clear to me that the American revolution is not over, and that it must continue until all the men and women of the nation are equal and have realized the their all of their rights.
No longer should the people of of our society be made to labor unhappily and without meaning for the benefit and excess consumption of those who do not earn in proportion to their living. —Do not mistake my words; I do not call for the abolition of productive labor, but for the just end to the alienation of workers to their work, as well as their exploitation by the capital class.
We must be tolerant of all people, rich or poor, profiting or waging, renting or land-lording. It is the duty of a just and democratic society to forgive and renew, and to avoid devolving towards the reactionary and misguided pursuit of retribution and revanchism. We must not alienate anyone, and should seek to establish equality among all people.
Thank you for reading if you got this far, and I hope you come back to this site another time for new content. I write and post every once in a while, and I hope to be writing more often, and with a diverse set of subjects.
Much appreciation. -Cade