I’m almost embarrassed to write this post, but I hear this argument made so often that I feel it has to be addressed.  Among the most fundamental pillars of popular American support for capitalism is the belief that people should be rewarded for their labor (which, of course, is true).  The idea usually goes something like this:  the wealthy are wealthy because of their hard work.  They have the massive wealth they have because of their strong worth ethic, their ingenuity, their intelligence, and all the rest.  Therefore it would be an injustice and unfair punishment to tax them at a higher rate or place caps on what people earn.  This is a core ideological argument for popular American support for unbridled capitalism.  You will hear it at Thanksgiving dinner tables across the country, and ordinary Joe’s and Jackie’s will sagely state variations of this argument as they lean across the diner counter to refresh your coffee as you grumble about the latest Wall Street outrage.

Perhaps the first question to ask is the Nietzschean question of who sees the world this way.  As Nietzsche taught us, every enunciation presupposes a point of view, a standpoint of seeing the world the world in a certain way.  So who is it that sees massive accumulations of wealth as the result of hard work?  The answer is that only the worker– the person who must sell their labor as a commodity to live –can see the world in this way.  Us workers– and we should not assume that “worker” is a synonym for blue collar labor; it’s anyone who sells their labor to live –live in a universe where the only way we can live is by working for a wage.  As a consequence, the vast majority cannot even begin to imagine a universe where money is made in some way other than through labor or work.  As a result, we assume that this must be how capitalists make their money and that, if they have so much more money than we do, it is because they work harder, are more intelligent, have more ingenuity, and all the rest.  They must deserve what they have.  This is a fundamental illusion.

read on!

There is a certain sublime genius to Marx’s little equations C-M-C and M-C-M because they distill the difference between workers and capitalists to their most basic essence, revealing just how disparate these two worlds are.  Us workers follow this basic logic:

C – M – C

Commodity – Money – Commodity

Commodity – Money / Money – Commodity

Us workers sell our labor as a commodity in return for money.  We then use that money to buy the commodities that we need to live (shelter, food, clothing, transportation, etc).  Ironically and unjustly, must of the commodities we buy are necessities we must have in order to work.  This is the world of the worker.

The world of the capitalist is entirely different, and is the inverse of the world of the worker:

M – C – M

Money – Commodity – Money

Money – Commodity / Commodity – Money

The capitalist uses his money to buy a commodity, and then sells that commodity to make a profit on his investment.  The commodities that the capitalist buys can be any number of things:  labor, hotels, debt, stocks, etc.  It matters little what the commodity is, so long as one can get a return on his investment.  In other words, in the case of the capitalist, it is not his labor that makes his money, but rather his money that makes his money.  In other words, it is not hard work that makes a capitalist money– which isn’t to say there aren’t hard working capitalists –but money that makes their money.

Let’s put this into perspective.  Suppose you were a complete and utter moron, but were fortunate and won the lottery to the the tune of $480 million.  Now as a moron and a working stiff that knows nothing about money beyond spending it to buy the commodities you need to live on a day to day basis, you decided to place your new found millions in a bank account, rather than spend it.  You’re looking at about a 1.25% interest rate on your average savings account; a stupid way of investing money.  However, concretely what will that stupid way of investing money yield annually?  $6 million a year!  Let me repeat.  $6 million a year.  That is, of course, before taxes.

Now no one, even the most grotesquely stupid person, would ever put such sums of money in a savings account.  The point is that the person who has this sort of money doesn’t have to do anything to make more money.  The money does all of the work for them.  This is even more the case with various investment plans that get a far greater return on their investments.  The capitalist is able to go about his business, doing nothing at all, thinking nothing at all, worrying about nothing at all, while their money makes money for them.  Far from being the result of some special genius or hard work or ingenuity, it’s the money that does all the work.  This is a fundamentally different world than the worker lives in and is certainly not the world of the Randian, entrepreneurial super-hero.  It is a world that the worker can scarcely imagine, because the worker has only ever known the sale of his labor to buy the goods he needs to live.  There is nothing deserved in such a world, and certainly not at the obscene levels of wealth we see in modern society.