The "risk" argument.

[A Revolutionary Tool]

I bet all of you had heard this argument before. It usually comes after you've explained to the capitalist sympathizer that capitalism is exploitative in nature and as a system and they have nowhere else to go. It's always the hardest one for me to counter too. It goes like this:

"But the capitalist risked his money, the laborer doesn't put in any risk at all".

Anybody have any good arguments against this line of defense to use.

[BIG BROTHER]

Well for one all capital is exploited labor. Either this entrepenuer was exploited himself and in the process made a fellow capitalist more powerful and likely to crush him or he entrepenuer is exploting other workers already.

Its stupid for the capitalist to take risk and is nothing to be rewarded, in a planned society not only would people live better off and not be exploited but we can actually know what is needed and what is not, without wasting precios labor and resources in risk.

ALSO I'm to lazy to explain better but figure this if a capitalist risks and starts creating profit soon enough he gets what he invested back and then more as profits increases. At the same time the worker who made his adventure possible will not get richer as time goes by no matter what!

[Savage]

That only really applies to small business, and anyway the capitalist has money to begin with, his/her economic motive is further accumulation, the laborer's motive is survival, risking profit is a much smaller risk than your life.

[NecroCommie]

The society does not live on risks. It lives on labor. Why should we reward risks?

[Niccolò Rossi]

"But the capitalist risked his money, the laborer doesn't put in any risk at all".

Anybody have any good arguments against this line of defense to use.

How about this one: I don't give a fuck. Workers' revolution doesn't need to justify itself according to bourgeois moral values.

Nic.

[graymouser]

Profit on capital investment does not come from risk, it comes from the mechanisms described by Marx in Capital: that is, absolute surplus-value (getting more hours of work for the same amount of pay) and relative surplus-value (getting more product per hour worked). The difference between capital layout C and its return C' is not proportional to how much risk the capitalist is taking. If it takes 1 day of socially necessary labor for a factory to make 500 shirts, it's no different if the owner has an order in hand where he will sell the 500 shirts as soon as they are finished (no risk) or if he has no such order and must go out and find a buyer (100% risk). So from the objective standpoint there is no factor for risk in the generation of profit.

Therefore this argument is a moral argument, on which point capitalism cannot expect to win. In the real world of capitalists, there is no socially abstract capital which comes clean and free. Marx went to extensive lengths to prove this in Capital, where he showed that capitalism arose "dripping from head to foot, from every pore, with blood and dirt." The capitalist system is predicated on the systematic dispossession of the European peasantry, the enslavement of Africans, the genocide of Native Americans, and the colonization of the world. Contrary to "libertarian" capitalist fantasies, the continuation of the system requires systematic repression both in the imperialist countries and in the third world, although the forms are different.

Finally, this argument could only apply to a small bourgeois - an owner of a company of some relatively small size. In reality, capitalism is not run by the "small businesses" that are fetishized by American politicians but by the tremendous financial banks, the houses of institutional capital. At this scale there is no moral right that accrues; the "capitalist" is a humongous joint-stock company whose "risks" are all hedged through the byzantine channels by which it involves itself in the actual production of commodities. The argument is referring not to actual capitalism but to a utopian picture of a capitalism dominated by human beings rather than corporations, which only barely existed in Marx's time and was quickly subsumed by the corporate/financial system because of that system's innate advantages under capitalism.

[Khalid]

The only “risk” is that the capitalist might have to start working for a living. Like everyone else.

[Niccolò Rossi]

Profit on capital investment does not come from risk

This is true. But to make a profit the capitalist must first sell his goods on the market (in other words, the value embodied in the commodities must be realised). This without a doubt anarchic and involves risk, this is the nature of the market itself.

Nic.

[ZeroNowhere]

Let's say that the price of a door is $5. 1 door can be produced per hour. The capitalist pays wages of $10 in order for production to commence.

In that case, if they had the labourers produce for 1 hour, the capitalist would make a loss of $5. If another capitalist had the labourers produce for 2 hours, they would make nothing. However, they would be taking a very significant risk, as a small price fluctuation, or even failing to sell 1 door, would mean that they make a loss. If another had the labourers produce for 3 hours, then they would have $15, and hence could make a profit, although if they fail to sell one door, they make no money, and, if accompanied with a fall in prices, even a rather tiny one, or if they fail to sell 2 doors, they make a loss.

If, on the other hand, another capitalist happened to also be producing, and had his labourers produce for 8 hours, then this would mean $40. On the other hand, they could afford to not sell 1 or 2 doors and still make a larger profit than the other two. Larger profit, lesser risk.

Perhaps be cheeky and point out that Adam Smith had pointed out the exact same thing as regards 'management duties', which in fact are more or less completely divorced from capitalist nowadays.

[manic expression]

Slave traders put in tons of risk. So what?

Capitalists these days barely risk anything. The big bankers sank the entire economy through their own greed in 2008 and got fat state-funded bonuses right after. Their only "risk" is that if they screw up completely, they might be forced to be merely filthy rich. You want to talk about risk, look at a miner. Look at a long-distance truck driver. Look at a worker going back to work even though his/her health is at risk. That's risk.

The only issue for workers is that when you're oppressed and deprived, you have so very little to "risk" anyway.

[NewSocialist]

Everything you need to know - http://anarchism.pageabode.com/afaq/secC2.html#secc29

[Bombay]

Slave traders put in tons of risk. So what?

This is good IMO. Capitalists say the risk factor justifies the exploitation. Does it justify slavery? The funny thing is that when they bring up the "risk argument" they actually admit the exploitation of the workers.

It's just sad the workers are in a different position. When they take risks it doesn't justify anything. When the workers get greedy, it's a bad thing. It's not that hard to show the hypocrisy we face everyday.

[JazzRemington]

well, these people tend to operate on a very narrow sense of "risk." Generally, bourgeois economists only look at purely economic factors of peoples' lives and society (or at least they say they do). So, it is true that the bourgeoisie are taking risks by fronting the money to buy, say, labor power, machinery, and the like. The risk comes in the form of the chance of going out of business, basically. So, by this logic the proletariat doesn't risk anything because they don't generally do this. They simply go to work for the boss and don't really front anything or lose anything aside from future wages (usually they are fronted their wages before any commodities are sold happen).

One way of dealing with this is to point out that it's biased in favor of the bourgeoisie. Because of the very idiosyncratic and narrow use of "risk" (which is deliberate), it would seem logical that the bourgeoisie would be the only ones risking anything. In other words, the evidence is custom made to support a specific conclusion.

[mikelepore]

If it were true that someone becomes the rightful owner of something as a result of taking a risk while acquiring it, it would be contradictory that the capitalist condemns the bank robber, since the bank robber becomes the rightful owner of the money as a result of taking on the risks associated with being a robber.

[mikelepore]

They simply go to work for the boss and don't really front anything or lose anything aside from future wages

There are many sides to that aspect of having nothing to lose but future wages.

Workers take on mortgages (and car loans, etc.) based on assumptions about the magnitudes of their future wages, but then they may be deprived of those expected wages at any time, due to a one-sided decision by the employer. Surely there are more negative factors if the sheriff removes your family from that house than there would be if you had never purchased that house in the first place.

Many workers uproot their famiies and move across the country, or move to other countries, because they were offered jobs there -- not knowing whether they will get laid off soon after they move there.

In a company where I used to work, some people who were already employed were told that their jobs were being moved to the company's other plant in a distant city, so they prepared to relocate their families. Those who were home owners sold their houses, and apartment renters forfeited deposits to break their leases. On the morning that they were scheduled to move -- the moving trucks were already loaded with their furniture -- they were told that the company's plan to relocate the department had just been cancelled, and their transfers were cancelled. Now they were expected to report to work that morning in the usual place, everything exactly the same as before, except for the little inconvenience that they were now homeless.

The risk for the working class is growing. There are now students who take out 30 year loans to pay for college so they can be trained for specialized jobs, not knowing whether there will be any jobs available in those fields after their education is completed. If you do end up with that degree in automotive engineering and a job at McDonald's, you will still have to make those education loan payments for the next 30 years.

But this one is my favorite: You may end up working for a company that says you can retire with a pension of a specific amount if you have worked there for 30 consecutive years, but then suppose you get laid off after you have been there for 29 years an 11 months. In the U.S. the law says you must be "vested" in the retirement plan if you have been there for at least 5 years, so you are guaranteed to get "something". But that something may be, for example, a pension for working 29 years and 11 months that is only one-quarter or one-fifth or some other small fraction of the pension for working 30 years.

No risk, huh?

***

By the way, although my comments above are money-related, we must challenge the capitalist pretense that a risk is something that is purely related to money, and that risk doesn't take other and more personal forms.

I have heard of workers being crushed or electrocuted or poisoned or falling to their deaths on the job. I have never heard of any capitalist dying from a sore index finger as a result of picking up the telephone and placing an order with a stock broker.

[Amphictyonis]

The small capitalist has risk. If his business succeeds the large capitalist buys him out. If the business fails then back to wage slavery she goes. In reality large capitalists exist so that argument doesn't hold any water. If some petty bourgeois puts her/his life savings into a small business then yes, there is a risk factor. Even so, the entire nation cannot be small business owners so no matter what there will always be millions of people who have no choice but to be wage slaves.


This "risk" they speak of can be compared to chattel slaves having the ability to buy their freedom. If a wage slave saves up money to start a business he's risking not freeing himself from wage slavery. Thats the only risk and the large capitalist has monopolies on all the major services so how do you "compete" with such entities? That's when the idiot supporter of capitalism will blame monopolies on the state. A never ending circle of empty arguments.

[ckaihatsu]

"But the capitalist risked his money, the laborer doesn't put in any risk at all".


Besides the excellent points already made about massive corporate financialization (diversification), government-backed public-money bailouts (public underwriting of risk), and real-life hazards at the workplace for those workers doing the actual grunt work ("personal-health capital")(my wording), here's another take on the term 'risk':

Taking the term 'risk' at face value, the term has an edgy, sexy kind of feel to it -- I take the connotation to be that of a masculine quality, suggesting the male head of the household being the leader with the rest of the family in tow, against the uncertain forces of the outside world in an ever-shifting landscape, while carving a smart, decisive path into the future through well-informed, robust decision-making.

I think it's this feel -- an uninformed consumerist assumption -- that plays right into the libertarian political marketing of "risk" as being a real-world integral component of a hardy challenge for a mom-and-pop small-business enterprise -- a lifelong dream of manageable, profitable ownership and attainable improved quality of life for the average American. "Risk" is thus extended as a solemn responsibility to only those who are truly serious and mature, and may even be the culminating definition of adulthood itself.

With this kind of attitude fully internalized, people will willingly make that final turn away from anything "collective" or "commonizing", instead going the road of individualizing onto themselves whatever it is they deem to be worthy of risking. The payoff, besides anticipated future rewards, is the testing of their individuality and the increasing construction of their self-definition through such adversities of judgment.

I'm pretty sure it's this mindset that leads to the base, snobby attitude that people who *don't* take on external material ownership are merely workers and aren't risking anything by just punching a clock every day.

[Thirsty Crow]

Taking the term 'risk' at face value, the term has an edgy, sexy kind of feel to it -- I take the connotation to be that of a masculine quality, suggesting the male head of the household being the leader with the rest of the family in tow, against the uncertain forces of the outside world in an ever-shifting landscape, while carving a smart, decisive path into the future through well-informed, robust decision-making.Absolutely.
As such, this whole story of risk seems like an ideological attempt at reviving the old notions of "heroic bourgeoisie", quasi-promethean, transforming the world and placing themselves at the fore of any kind of development. Of course, this ideological story still favours certain subjects over others as you correctly notice how it conveys a subtle favouring of rugged male individuals,k thereby perpetuating forms of oppression which cannot be readily understood as economic).
Needless to say, that time has passed, and we can safely conclude that our historical epoch has nothing to do with such notions.


I think it's this feel -- an uninformed consumerist assumption -- that plays right into the libertarian political marketing of "risk" as being a real-world integral component of a hardy challenge for a mom-and-pop small-business enterprise -- a lifelong dream of manageable, profitable ownership and attainable improved quality of life for the average American. "Risk" is thus extended as a solemn responsibility to only those who are truly serious and mature, and may even be the culminating definition of adulthood itself.Spot on.
It seems to me that this story in fact reinforces the notion of individuality which asserts that only those willing to risk something for a profit are capable of exerting control over themselves ("self-management", "self-reliance") and therby they become "free" - the only ones bearing responsibility of decision making.
Again, this can be connected to the specific acoounts of "childish people" who are not capable for self-management and shoudl therefore be under the supervision and control of those who are (one of the rationalizations of the Enlightenment of the fact of colonialism and "national" exploitation).



With this kind of attitude fully internalized, people will willingly make that final turn away from anything "collective" or "commonizing", instead going the road of individualizing onto themselves whatever it is they deem to be worthy of risking. The payoff, besides anticipated future rewards, is the testing of their individuality and the increasing construction of their self-definition through such adversities of judgment.Again, spot on.
it cannot be emphasized enough how identity construction has been tied in to the pursuit of market advantage and creation of wealth which then takes on a specific form of "risk".
What this pracitcally means forcommunists is that more attention should be paid to measures, manners and modes of identity/individuality construction which could operate against the drive to assert oneself through accumulation (either of commodities or capital). Basically, I think that this insight testifies to te needof organs of alternaive culture, directly linked to more traditionally conceived class struggle.
Another question provoked by this argument is also a tricky one...did Marxists and other revolutionaries make a mistake of shying away from the issue of individual personality and its making? From my experience, I can say that too many revolutionaries are satisfied with the simplification of "people are the products of their social environment".


I'm pretty sure it's this mindset that leads to the base, snobby attitude that people who *don't* take on external material ownership are merely workers and aren't risking anything by just punching a clock every day.I'd add that this attitude rests on the notion of improvement, and since workers do not, generally speaking, exhibit the tendency towards hoarding up abillities and commodities, attaining capital and more opportunities - they are in effect lesser beings who do not deserve to have a say over matters that affect their lives (since they do not show, or possess the ability to show, initiative).
The basic standard is that of a possessive individual, profiting from the competition with others of his kind.

[ckaihatsu]

What this pracitcally means forcommunists is that more attention should be paid to measures, manners and modes of identity/individuality construction which could operate against the drive to assert oneself through accumulation (either of commodities or capital).




Basically, I think that this insight testifies to te needof organs of alternaive culture, directly linked to more traditionally conceived class struggle.


Agreed. I'll venture to say that -- in my experience -- there's been a lack of a comprehensive *materialist* critique at all scales of social existence, down through to individuality itself. Usually psychology tends to fill the void at the small-scale but it's based on an overly individualistic Cartesian dualism that puts the individual under a microscope, conveniently detached from the overall socio-political environment. This is both the result of Western reductionism *and* is politically beneficial to those exercising power since it plays into the common divide-and-conquer strategy.





I'd add that this attitude rests on the notion of improvement, and since workers do not, generally speaking, exhibit the tendency towards hoarding up abillities and commodities, attaining capital and more opportunities - they are in effect lesser beings who do not deserve to have a say over matters that affect their lives (since they do not show, or possess the ability to show, initiative).
The basic standard is that of a possessive individual, profiting from the competition with others of his kind.


This is a tricky issue to tackle since it resonates with -- conversely -- the *macroscopic* aspects of society and civilization, and its forward, future progress, whatever that may be.

Society has been on the default, prevailing trajectory of that provided by the hoarding, capital-expansion, opportunistic, initiative-taking, possessive, competitive, profiting mode of social existence -- to cover a variety of scales in description here, from micro to macro.

In attempting to address 'risk' in a *generic*, future-oriented, pathfinding, trailblazing way, we need to be able to conceptualize an *alternative* to how it's *currently* done by the default mechanisms / behaviors you've listed. Just as in attempting to describe what kind of society we as revolutionaries want to usher in, we have to likewise be able to describe how we would "push the envelope" of future societal / civilizational *and* individualistic development, going forward -- the alternative to *not* providing an alternative is to be stuck with blank faces, merely criticizing the status quo while forfeiting a political opening to suggest a worker-based human mode of living and societal improvement, post-capitalism.

We can't just pretend that, after the revolution, the workers' mass judgment would default to no decision at all over the state of society, putting it on a kind of "autopilot" state of stasis similar to that of today's zombie inertia provided by the non-conscious market mechanism.

It would be helpful to wrest away this term of 'risk', and to re-define it in a revolutionarily progressive way....

[Misanthrope]

Social mobility is extremely low all over the world, these lower class people don't even have the chance to take this risk. Also, completely agree with NecroCommie. An economy cannot exist without labor but can exist without capitalists.

Oh and not to mention the annual work related deaths. Capitalists taking risks? Please.

[JazzRemington]

[...]No risk, huh?

Not by bourgeois logic, no. Like I said, it's a very deliberate and idiosyncratic definition of "risk" that capitalists use. It's only a "risk" when capital is invested into a business by the bourgeoisie.