The Cooperativist Manifesto

CHAPTER 2: THE SPECIAL ROLE OF LABOUR IN THE PRODUCTION OF WEALTH

Economic justice is concerned with the production and distribution of wealth within our society. Each person that participates in the production of wealth should receive a share of the wealth produced by the collective in proportion to the value of his or her contribution to the production of that wealth.

Diverse thinkers, such as Aristotle, Locke, Marx and Keynes, have all espoused the belief that every person has the natural right to work and to enjoy the fruits of their own labour. The views of these thinkers as to the just distribution of the wealth of production are not as uniform. Marxists, for instance, claim that wealth should be distributed "from each according to his ability, to each according to his needs." The Marxian view of the distribution of productive wealth failed to account for market elements. Whenever reward is bestowed on a discretionary or charitable basis, the distribution process is subject to perverse influences. An economic system predicated on charity more so than justice will not endure as long as self-interest remains a prevalent human trait.

Capitalist theory recognizes that the production and distribution of wealth involves considerations of ability and need. However, capitalism is predicated on several incorrect assumptions. One of the most important flaws of conventional capitalist theory is its reliance on market mechanisms to allocate "fair" values to the factors of production.

The traditional notion that the value of labour may be measured in wages alone ignores the residual contributions of labour within the production process. The market value of the final product derived from the performance of labour services involves an element of "profit" that properly belongs to labour.

Cooperativism recognizes that labour is more than simply another factor of production. Human beings are not factors of production in the same manner as things such as capital and land. Labour services can be used in the production process together with capital instruments, but labour has unique characteristics that make it responsible for added value. Only labour can claim responsibility for production. This truism prevails even for basic labour services.

The special role of labour in the production of wealth is embodied in sophisticated forms of labour, such as innovation and entrepreneurship. Entrepreneurial work is often described as the most valuable form of labour in a commercial enterprise. Business profits are determined by entrepreneurship, which includes services in the nature of innovation, commercial organization and management services. The entrepreneur- like other labourers- clearly uses capital instruments for the purpose of producing wealth.

Once we recognize that labour has a special role in the creation of wealth, we will be more amenable to the notion of cooperative sharing of the residuals profits of commercial activities. A co-operative enterprise generally refers to a business or society that is owned and operated by its members. Work responsibilities, residual profits and economic gains arising from the common enterprise would typically be apportioned among the members of the cooperative. Laws and state practices should promote cooperative arrangements across all sectors of society. Each person that participates in the production of wealth should receive a share of the wealth produced by the collective in proportion to the value of his or her contribution to the production of that wealth.