If someone sold you a car for much more than they paid for it, wouldn’t you feel something wrong had happened? Even if you had gotten the market rate? Was that fair? Because I, as I mull and overboil this question, think not. I find it much more akin to the act of the cutpurse, the pickpocket or the thief… a huckster in a beautiful expensive suit.
“Profit is theft” So I misquote Proudhon, but I do not miss his point. Value is a zero-sum game and profit comes only from some unfairness.
“Profit” is the shaving down, the conniving whittling away of costs, product quality, services and wages to create a difference between what is owed and what is paid. Then the wood-curls of undelivered value are swept up, pulped, and stuck into ever-widening bank accounts. For the economists in the back, it is the creation of a surplus from the difference between costs and incomes. But in a world where everything is paid for fairly—where every addition of value is compensated fairly—, where could that difference ever come from? Only from underpayment, under-fulfilment, unfair markets and the exploitation of under-protected resources.
Expenses = recompense for all the value added to product by materials and labor
Income = payment for the value of the product
Profit = income – expenses; 0 in a fair system.
In a truly fair and free and fair market, where everyone gets what they’re owed, profit is dead. That is the truth of a perfectly competitive market.
The love child of greed and competition, profit relies on unfairness and exploitation; on taking value from some source without giving equal value in return. It curls itself only out of the imbalance, unfairness, exploitation of some system. For every profit, where does it come from? And where does it go…? Those are the essential questions of fair economics.
Progenitor of invention, bringer of mighty changes, hopes, improvements and great things—blessings upon profit! But all this for whom? And on what terms? If for no one else, always for the profiteer! Whose terms assume a small theft will never be noticed, if it is cloaked in enough arcane documents and meetings. They will take what they can get away with, anything to slip their neck out from under the boot of an actual fair market. And not just out—that would be completely understandable—but clear down the street with bags of cash in each hand! Slipping their mask off like bank-robbers as the getaway-car rounds the corner.
But if not the profiteer, who will undertake new things? Take risks or improve things! Those are the terms of the game, are they not? You make more money for undertaking calculated risk; that is why you take the risks necessary to make life better!
Yet invention also has a mother: necessity, and her other suitor, hope. And they are more than capable of bringing invention into the world without the outsized clutching, the accounting of straws from the bale, that is the smiling endeavor of profit. We can do things because they should be done for the world in which we want to live. Not just for the dream of stacking unlikely quantities of money in bank accounts to get as far from the world as we can. Even if this couple is not sufficient…profit can at least be slimmed down a few sizes; if we keep its origin in mind and do not treat it as some holy right. Because fair economics supports human life. Our supposedly fair—or at least organized—system of taking has other ideas. Which is more legitimate?
Profit is a hulking tangled mass of unfairness that hides its selfish purpose under a legal and ideological veil. But to peek beneath, to remember that things do not always have to be the way they are and that some things could be very different, that is to see something true. And to see it, after all, with the same eyes of inevitable economic analysis that profiteers and economists have. So we bring forth the illusory nature of what appears fixed; of the legitimacy of profit at scale. Profit at scale has similarities to theft in that it comes from taking without recompense what rightly belongs elsewhere. A radical statement out of a simple Keynesian conclusion about what profits look like in fair and monopolistic markets.
What is is not all there is, and we need not assume the legitimacy of what already is without vetting it. If we can bring out the same analytical axe from which all this is hewn and split it in two, then we know it has not been as true as has been proclaimed.
