Distribution - Economics and Ecology: United for a Sustainable World - page 93

subject to depletion only) was accompanied by the ascendancy of a new,
important actor in the economic drama—the capitalist .
The existence of capital , as the machines came to be called, naturally gave
birth to the capitalist—the person owning the machines—and, of course, to
capitalism . The latter term simply put an appropriate label on a system of pro-
duction in which the components were in private ownership. Now, due to the
harnessing of these seemingly wondrous new technologies, it was possible
to create surplus at a pace that was historically unimaginable.
As might be expected, this increased tensions surrounding questions
of how the surplus was to be distributed—questions that would not have
surfaced if virtually everyone had been at the level of subsistence. But the
capitalist was clearly above that level. For better or worse, conventional eco-
nomic doctrine concluded that the capitalist should get to keep and use most
of the surplus. After all, he (and it was virtually always a “he”) owned the
machines responsible for the dramatic increases in both production and the
ever-widening gap between the requirements of subsistence and the avail-
ability of actual excess.
The story does not end here, however. Tracing the parallel development
of this newly dominant economic system and the intellectual thought sup-
porting it, we observe the capitalist keeping most of the surplus by the 19th
century. This circumstance lands us squarely in the middle of the classical
economics of Adam Smith, David Ricardo, Thomas Malthus, and Karl Marx.
Most of these thinkers celebrated the wonders of industrialization, spe-
cialization, and trade. However, the pollution and squalor of the working
conditions in the early European factories were apparent to Karl Marx, the
most heretical member of the classical economic school. Marx, as did all his
less radical compatriots, accepted the labor theory of value, which contends
that human labor is the basic, underlying source of all productive capability.
Nevertheless, because he observed and reacted to the exploitation of workers,
his view of the distribution of surplus differed from the other, more main-
stream thinkers—most of whom are not only revered but also still quoted
when it serves the particular vested interests.
Marx, however, is studiously ignored due to his unpopular politics, even
though his economic analysis is clearly more accurate than that of his Classical
School colleagues. The globalized corporate world of today, for instance, was
predicted almost exactly by Marx, and bears little resemblance to the per-
fectly competitive and benign market economy of Smith and Ricardo. On the
other hand, Malthus, with his gloomy premonitions of impending scarcity,
may turn out to be the real oracle.
According to Marx, workers were customarily paid just enough to meet
the required standard of subsistence, despite the fact that they (in conjunc-
tion with the emergent machines) were fundamentally responsible for the
dramatic increases in the output of commodities. To Marx, therefore, the
capitalists were unfairly expropriating the surplus, and the resultant pattern
of distribution was unfair.