Labor exchange

“ The value of any commodity, therefore, to the person who possesses it, and who means not to use or consume it himself, but to exchange it for other commodities, is equal to the quantity of labor which it enables him to purchase or command. Labor, therefore, is the real measure of the exchangeable value of all commodities.
The real price of everything, what everything really costs to the man who wants to acquire it, is the toil and trouble of acquiring it. ”

“ There is a phase of this matter which is both interesting and serious. The farmer has always produced the foodstuffs to exchange with the city dweller for the other necessities of life. This division of labor is the basis of modern civilization. At the present time it is threatened with breakdown. The town and city industries are not producing adequate goods to exchange with the food-producing farmer. Raw materials and fuel are in short supply. Machinery, as I have said, is lacking or worn out. The farmer or the peasant cannot find the goods for sale which he desires to purchase. ”

“ It was at this time that the trades-union movement began to take definite form. Unorganized, the workers were not only in open competition with each other for the sale of their labor power in the labor market, but their wages could be reduced, and their hours of labor lengthened at will, and they were left practically at the mercy of their employers. ”

“ Among these is the influence of customary wage relationships upon the course of wage movements within an industry, and to a lesser extent throughout industry. Because of the existence of vague customary relationships, wage movements affecting some groups or classes of labor are likely to 83 stimulate similar movements among other groups; though it is plain that the efforts of different groups may not meet with equal success. ”

“ Let us, therefore, deduct from the preceding four millions the persons engaged in retail trade, and all skilled laborers in the various trades which we formerly included because we conceived that they might be connected with some form of labor organization, and might also obtain some benefit through the profits of their employers. ”

“ While capital invested in manufactures is yielding adequate and fair profits under the new system, the wages of labor, whether employed in manufactures, agriculture, commerce, or navigation, have been augmented. The toiling millions whose daily labor furnishes the supply of food and raiment and all the necessaries and comforts of life are receiving higher wages and more steady and permanent employment than in any other country or at any previous period of our own history. ”

“ In addition to this personal, human relationship, capital might and should, in all justice and humanity, identify the pecuniary interests of labor with its own interests. What is known as industrial partnership is simply a solution of this branch of the problem. The principle is simply that of giving labor a pecuniary interest in the profits of the establishment pro rata with his own wages. A bonus is set on frugality and industry and conscientiousness of work by making the hands small partners in the concern. ”

“ Did they demand more, the competition of others would prevent them from getting employment. Did he offer less, none would accept the terms, as they could obtain greater results by working for themselves. Thus, although the employer wishes to pay as little as possible, and the employee to receive as much as possible, wages will be fixed by the value or produce of such labor to the laborers themselves. If wages are temporarily carried either above or below this line, a tendency to carry them back at once arises. ”

“ The demand of the community for the product of labor in general will ultimately keep pace with the supply of the product. Economies 50 in production throughout the whole industrial field mean that there will be more commodities to be shared out.
Thus, in spite of the fact that there may be, and often are, serious breaches of interest between particular groups of wage earners and society as a whole on the matter of increased production, there can be but one sound policy for labor as a whole. ”

“ The 144 motives and sentiments of the various organized groups will govern the action of the wage earners, and produce almost the same result under any system of wage payment. The state of industrial relations, the satisfaction the workers feel in their position, the reasonableness shown by the different groups, the intelligence or ignorance of labor leadership—these and similar other factors will, at bottom, govern the effort put forth by the wage earners. These are the matters to which all who realize the need for steady and willing effort in production will have to attend. ”

“ But there is a far more complete remedy than piece-work for the disadvantages of hired labor, viz., what is now called industrial partnership—the admission of the whole body of laborers to a participation in the profits, by distributing among [110] all who share in the work, in the form of a percentage on their earnings, the whole or a fixed portion of the gains after a certain remuneration has been allowed to the capitalist. ”

“ It is in this process of competition for employment, and competition to employ, that the return to labor—wages—is decided, simultaneously with the return to each and every group or agent. The return to labor will be high if the employment of the ordinary worker, as part of a productive organization, adds considerably to the total of market values produced. For if the ordinary wage earner, by his work, makes possible a considerable addition to the market values produced, competition among employers for men will lead to the payment of high wages, and vice versa. ”

“ Employers and employed make contracts on the best terms which they can agree upon, like buyers and sellers, renters and hirers, borrowers and lenders. Their relations are, therefore, controlled by the universal law of supply and demand. The employer assumes the direction of the business, and takes all the risk, for the capital must be consumed in the industrial process, and whether it will be found again in the product or not depends upon the good judgment and foresight with which the capital and labor have been applied. Under the wages system the employer and the employé contract for time. ”

“ But it was the wage-workers who suffered the most from the great oligarchy of wealth which had been established in the name of the people for the express purpose of exacting profits from the industrial classes. They organized Trade Unions which ultimately federated into one great national organization with a view to securing higher wages and fewer hours of labor without any regard to the interests of the consumers of their products. The number of workmen in these Trade Unions were at all times but a small fraction of the multitude which depended upon wages. ”

“ Instead of laborers competing with each other for employment, and in their competition cutting down wages to the point of bare subsistence, employers would everywhere be competing for laborers, and wages would rise to the fair earnings of labor. For into the labor market would have entered the greatest of all competitors for the employment of labor, a competitor whose demand cannot be satisfied until want is satisfied—the demand of labor itself. ”

“ With the extension of trade and the wider use of machinery the number and power of the adult employed workmen increased, and with their increase of power came a jealousy, on the one hand, toward the masters; on the other, toward the apprentices, who were regarded as cheapening labor when employed in too great numbers. The conflict which arose between employer and employed gradually merged into one between capital and labor. ”

“ It was also seen that what determined the plane of thought and action at any one time was the state of business measured by movements of wholesale and retail prices and employment and unemployment. When prices rose and margins of employers' profits were on the increase, the demand for labor increased and accordingly also labor's strength as a bargainer; at the same time, labor was compelled to organize to meet a rising cost of living. ”

“ What happens when there are ten men competing to sell their labor-power? Who gets the job?
What happens when there are several jobs and only one worker? Will he receive higher or lower wages? Will he get a good price for his labor-power?
When workingmen are scarce and manufacturers are forced to pay a high price for labor-power (high wages) in a certain locality, does the scarcity of workers last long? ”

“ The employment of men, the fixing of their wages, hours of labor, and working conditions, the bargaining in respect of these things-whether carried on separately or collectively-each and all constitute intercourse for the purposes of production, not of trade. ”

“ And just as the value of other commodities is determined by the amount of social labor necessary on an average for their reproduction, so the value of labor-power is likewise determined. Wages tend to a point at which they will cover the average cost of the necessary means of subsistence for the workers and their families, in any given time and place, under the conditions and according to the standards of living generally prevailing. Trade union action, for example, may force wages above that point, or undue stress in the competitive labor market may force wages below it. ”

“ The Rise of Trade Unions.—One of the most manifest effects of the introduction of the factory system was the intensification of the distinction between employers and employees. When a large number of laborers were gathered together in one establishment, all in a similar position one to the other and with common interests as to wages, hours of labor, and other conditions of their work, the fact that they were one homogeneous class could hardly escape their recognition. ”

“ Is it true that the wages of manufacturing labor are lower in foreign countries than in England, in any sense in which low wages are an advantage to the capitalist? The artisan of Ghent or Lyons may earn less wages in a day, but does he not do less work? Degrees of efficiency considered, does his labor cost less to his employer? ”

“ The minutest system of subdivided labor now rules here as in all trades. When a coat is in question, it is no longer the master-tailor, journeyman and apprentices who prepare it, but a legion of cutters, basters, machinists, pressers, fellers, button-hole, and [Pg 36] general workers, who find the learning of any one alone of the branches an easy matter, and so rush into the trade, the fiercest and most incessant competition being the instant result. ”

“ The objections of employers to any regulation of wages is partly economic, as they fear injury to trade, a fear not sustained by Australian experience, or by the experience of employers in trades in this country, in which wages have been raised and are largely controlled by strong labor organizations. ”

“ Trades-unions ought, among us, to emulate the wisdom of European workingmen, and use their mechanism to organize forms of association which should look not alone to winning higher wages but to making the most of existing wages, and ultimately to leading the wage-system into a higher development. ”

“ The reward of any one agent of production, for example, labor, depends not only on its own part in production, but upon the contribution of all other factors. A craftsman in the United States may be no abler than his fellow workman in France, but may receive twice his wage.
41 This line of reasoning must be qualified in one respect. There is some competition for employment between the several agents of production. Their relative efficiency will affect the demand for them, and so will also affect the share of the product each receives most directly. ”

“ Some of the greatest economic restrictions are not legislative but are what have grown out of customs and practices, especially of labor unions. I shall not here discuss the effect of labor unions upon wages, except in a general way. Wages spring from production and represent the division thereof among capital, management and labor. The aggregate of their shares of the three parties can exceed 100 per cent by no possibility. The conditions of modern civilization are too complex to permit a division of produce in kind. ”

“ Many labor leaders are again asking for an effectual control of the labor contract, not by the action of trade unions, but by the direct legislation of the state. What shall be our attitude to this demand? Before we can fairly answer this question we must consider somewhat more fully the character of the bargain that takes place between an employer and an individual workman, and the nature of the commodity that the laborer has to sell. ”

“ The rapidly changing processes and widening markets of English industry seemed to demand the sweeping away of all restrictions on the supply and employment of labour, a process which involved the levelling of all classes of wage-earners to their " natural wages." ”

“ These acts, and others of similar nature, were intended for the subjugation of laborers and the benefit of the employers of labor. It is only since the era of popular government that legislation for an opposite purpose has come in vogue. Gradually the right of the workingman to have the price of his labor fixed as is the price of other commodities, by the law of supply and demand, came to be recognized, although the progress was pitifully slow. ”

“ The working people have been called upon to make enormous sacrifices during the period of depressed trade, and have been unable to withstand all the encroachments of the employers upon Trade Union standards of wages and working conditions. ”