Belle of Liberty

Letting Freedom Ring

Wednesday, July 28, 2010

The Working Class

In the classic work The Wealth of Nations, published ironically in 1776, Scotsman Adam Smith noted that in the natural state, the wages of labor belonged entirely to the laborer, the worker. The worker answered to neither boss nor landlord.

This natural state ended with the appropriation of land, the accumulation of stock, and the division of labor. Wealth could be accumulated in one of three ways: wages for labor, rent for land, and profit from stock (using money to make money).

The Communists want to return us to that original state, eliminating property ownership and ownership of stock, as well usury, earning interest on one’s money. That is what they mean by the “Workers Paradise.”

All property and stock ownership would revert to the state, to be distributed “equally” among the people. Workers would no longer have a choice in employment; they would be set to work for whatever the common good required and their skills could bring about.

The doctor who spent years on his education would receive the same wages as the factory worker who learned his simple trade in a week. Heads of families would no longer provide for the security of their families through savings and investments, leaving an estate after their death; the state would provide for future generations.

We would have ideal security and complete stagnation. There would be no incentive to be more productive or more inventive. No one would invent the machine that could do a job faster or more efficiently. No inventor would want to be bothered, because they’d receive no recompense or credit.

The division of labor and the liberty of the free market has allowed great advances in the world. The natural increase in population has diminished wages in some respects, but also provided more producers and more consumers. With the introduction of money, workers were freed from the restrictions of barter and could purchase what they wanted or needed.

Competition insured that prices would (barring accidents and other disasters) maintain a consistent level, taking into account the price of labor, rent, and profits. Where governments have intervened excessively, crises have followed and tyranny resulted.

The titular head of Government Motors sitting in his first production “green” car, returning us symbolically to that “natural state” is a dismaying portent for the future of America and free enterprise.

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