The Laborer in the Culture of Capitalism
/ have read in E. P. Thompson's ' The Making of the English Working Class ' that the first man who attempted to establish a labor union in England at the end of the 18th century was arrested, tried for sedition, found guilty, drawn and quartered in a public square by attaching draft horses to each of his arms and legs and pulling him apart. He was then disemboweled and his guts were burned. Then they hanged what was left of him. One gathers from this that the propertied classes were slow to accept the idea of organized labor.
The capitalist system makes it very much easier for people not to realize what they are doing, not to know about the danger and hardship, the despair and humiliation, that their way of life implies for others.
—Edmund Wilson, The Shores of Light
The consumer may drive the culture of capitalism, but without the laborer there would be no commodities to consume. Yet the emergence of the laborer—the person who survives by selling labor—is a recent historical phenomenon. In past centuries most people had access to land on which to grow their own food, selling whatever surplus they produced, or they owned tools—implements for weaving, metalworking, or producing other objects for sale or trade. Thus, to understand capitalism it is necessary to examine why people choose or are forced to sell their labor. Before beginning this examination, it is necessary to have a fundamental understanding of the workings of the capitalist economy.
Capitalism is not an easy term to define. Pierre Proudhon, who first used the term in 1861, called it 'an economic and social regime in which capital, the source of income, does not generally belong to those who make it work through their labor' (cited Braudel 1982:237). The term capitalism does not appear in the writings of Karl Marx and did not gain currency until 1902, when the German economist Werner Sombart used it to denote the opposite of socialism. But definitions alone won't help us to understand fully the dynamics of something as complex as a capitalist economy. We need to understand the major
characteristics of capitalism to appreciate how it has permeated our lives as an economic and a cultural system.
Few people will deny that the genius of capitalism lies in its ability to produce goods—commodities for people to buy and consume. Let's start our excursion into capitalism with a product, beginning with something nearly all of us buy at one point or another—sneakers—and examine, briefly, the largest manufacturer of sneakers, Nike, Inc. Today most of the sneakers—and clothes—we wear are assembled overseas because large corporations, such as Nike, have increasingly relocated assembly factories from their home countries to countries on the periphery. Consequently, the clothes we wear; the TVs, stereos, and compact discs (CDs) we listen to; and the computers we use are at least partly produced by a person in another part of the world. This situation creates a clash of cultures that can be illuminating for what they tell us about other cultures and what they may tell us about ourselves. The effects that these factories have on other countries highlight the distinctive features of the capitalist economy and perhaps approximate the impact of early capitalism on our own society. But first let us digress briefly to an understanding of the economic logic of capitalism and, particularly, the role of labor within this economic system.
Part of the genius of the culture of capitalism is its ability to produce vast quantities of goods, such as these Nike products, that consumers all over the world clamor to buy.
A Primer on the Economic Elements of Capitalism
Let's run through a quick primer on the economics of capitalism and its development. Briefly stated, the economics of capitalism grew out of the interactions of the following five items:
Commodities (C). There are basically two types of
commodities: capital goods and
consumer goods. Capital goods, such as land, raw materials, tools, machines, and
factories, are used to produce consumer goods (e.g., television sets, VCRs, comput
ers, houses) to be sold to others.
2. Money (M).
Money is simply a standardized means of exchange. It serves to reduce
all goods and commodities to a standard value. By putting a monetary value on
something (e.g., a forest), it can be compared with any other commodity (e.g., gov
ernment bonds). Money, thus, greatly facilitates the exchange of commodities.
3. Labor power (lp). Labor power is
the work that is needed to transform one type of
commodity into another (e.g., steel into an automobile).
4. Means of
production (mp). Another term for capital goods, that is, the machines,
land, and tools with which other commodities are produced.
5. Production (P). The combination of lp and mp to produce commodities.
In precapitalist societies or noncapitalist production, as in capitalist production, people either make or obtain commodities—food, clothing, shelter, and the like—to use. These commodities have what economists call use value. If someone needs a shirt, they make it; if they need food, they gather, hunt, or grow it. Occasionally, they may trade for what they need or even buy it. Thus, a farmer might barter some corn (C) in exchange for a shirt (C') or use money to purchase it, but the object is always to obtain something for use. We can diagram this type of exchange as follows:
C-> C’ or C -> M -> C’
In capitalism, people produce or obtain goods not for their use, but for the purpose of exchange. That is, their object is to produce or obtain commodities (C) not to obtain another commodity (C') but to get capital or money (M). The goods have what is called exchange value. Thus, in a business transaction, when a person buys a commodity at one price and sells it at a higher price, the commodity is said to have an exchange value.
M -> C -> M’
Some people might argue that this exchange is capitalism, although most would call it mercantile exchange, suggesting that the formula for capitalism is incomplete. You still need one more development: to combine labor and the means of production in a unique way. From this perspective, fully developed capitalism looks like this:
M -> C -> P -> C’ -> M’ OR
M -> C -> mp/lp -> C’ -> M’
Thus, a manufacturer or producer has money (M) to buy commodities (C; e.g., raw material, machines, and labor) that are then combined (mp/lp) to manufacture commodities that carry a value greater than C (C). The sale of these commodities permits the producer to receive a sum of money greater than M (M') that constitutes profit. Note that at this point, labor is considered a commodity to be purchased or rented, in the same ways that raw materials, machines, factories, or land are purchased or rented. Labor becomes a factor of production in the same way that raw materials, land, or machines are factors of production. In addition, at this point the accumulation of wealth comes to consist increasingly of productive capital (raw materials, machines, factories).
Let's apply the formula to our sample capitalist enterprise, the Nike Corporation. Nike invests money (M) to buy commodities (C), consisting of such things as leather, rubber, machines to make textile, and factories (mp), which they combine with labor (lp), the people who design, produce, and assemble the commodity—sneakers—(C) that they then sell for money (M')- The object of this entire process is to get M' to exceed M as much as possible. That constitutes the profit—the bottom line, so to speak.
Furthermore, Nike doesn't just keep M'—it reinvests it in commodities and recom-bines it with mp and lp in order to repeat the process and earn/accumulate still more money and profits. (Figure 2.1 is a diagram of the cyclical nature of capitalist production.)
However, in the real world of finance there are other factors to consider. For example, producers of commodities do not often have the money (or capital) to start the production cycle on their own; they have to borrow money from banks or sell stock to investors to raise money to obtain the means of production and pay the labor power to produce goods. Consequently, some of the profits take the form of principal and interest to repay investors' loans. The higher the rate of interest that the manufacturer offers investors, the easier it is to obtain loans. Moreover the producer, for example, Nike, doesn't have to put its profits back into producing more sneakers. It may invest that money elsewhere with the possibility of earning greater profits; in other words the manufacture and
C = Commodities (capital goods) C = Commodities (consumer goods) M = Money invested M' = Money invested plus money earned (profit)
sale of sneakers may produce a profit of 10 percent, but if those profits can be reinvested elsewhere at 12 percent, so much the better.
This reveals one dilemma that Nike and other producers of commodities face: making a profit is not enough. They must give their investors (the banks, stockholders, and so on) who supplied the money or capital to start the cycle of production enough of a return on their money so that they do not take it elsewhere. If they go elsewhere (and investors in today's world, as we shall see, have an enormous number of investment options), Nike may find it harder to locate investors and put together the money necessary to restart the cycle. Consequently, they may have to pay higher interest rates and charge more for their products. In that case, however, they might not sell as many units, especially if Adidas or Reebok can sell their sneakers for less.
In order to make a profit, it is imperative to keep the money spent on factories, machines (mp), and labor (lp) as low as possible. In fact, according to some economists, the ability to minimize the production costs of mp and lp will determine the success or failure of the company. (We will return to that in a moment.)
It soon becomes apparent that the capitalist production process is very much a money-making game: Investors and manufacturers put money in at one end of the production process and get more money out of the other end in the form of profits or interest. It is very much like a hypothetical device that engineers call a 'black box.' Engineers assume that the black box produces something, but for the purposes of design and planning they do not concern themselves with how things are produced, that is, with the internal functioning of the box. They simply assume that if they put something into it—fuel, electricity, and so on—they will get something out (e.g., power, movement).
For most capitalist producers or investors, capitalism or capitalist enterprises, such as corporations, banks, bonds, or stocks, are like black boxes: You put money in one end and get more money out the other (see Figure 2.2). It is, of course, a highly complex business to know where to put the money, how much to invest, and so forth. But it is the amount of the return rather than the way that it is generated that is uppermost in importance.
Nevertheless, it is in the black box that commodities are produced and consumed. It is also in the black box that we find the patterns of social, political, economic, ecological, and ideological life that either promote or inhibit the conversion of money into more money.
Thus capitalism is more than an economic system; its operation has far-reaching consequences for almost all aspects of our existence. Most of us order our lives in some way to produce and consume commodities that generate the profits and interest that make the capitalist system work. But although most people who invest money do not concern
Investments (Input) Profits (Output)
Money (M) -------------------------- ► I I----------------------------- ► More Money (M'
The Black Box FIGURE 2.2 The Black Box
themselves with how it is
produced, others who are affected by this almost magical transformation
often conceptualize the process in profound ways. For example, peasant farmers in
The Baptism of Money
After losing their land to large farmers and being
forced to supplement their farming activities with wage labor, peasants in the
The idea that money is animate, that it can magically bring back more money, may at first seem strange to us, but Michael Taussig (1977) argued that the Colombian view of money is very close to our own—the major difference having to do with their conception of the black box.
The major feature of capitalism is that money can be used to make more money. To do so, the money must be invested in goods that must be sold, or invested in factories in which people work to make goods to be sold, and so on. Yet, we often talk as if it is the money itself that makes the money, or as if money somehow has a life of its own. We speak of 'the sagging dollar,' 'cash flows,' or 'putting our money to work.' The news will report that 'earnings have surged ahead,' or that we have 'climbing interest rates.' Factories are even referred to as 'plants' where our 'money grows.'
In other words, our language conveys the notion that capital has an innate property of self-expansion. It is talked about as if it were a living being that reproduces itself (just as the Colombian peasant believes baptized money has a life of its own and can reproduce itself).
The belief that money has a life of
its own is beautifully illustrated in Benjamin Franklin's classic work, Advice to a Young Tradesman (1748).
Remember, that money is of the prolific, generating nature. Money can beget money, and its offspring can beget more, and so on. Five shillings turned is six, turned again it is seven and three pence and so on, till it becomes a hundred pounds. The more there is of it, the more it produces every turning, so that the profits rise quicker and quicker. He that kills a breeding-sow, destroys all her offspring to the thousandth generation, (cited Taussig 1977:140)
The attitude expressed by Benjamin Franklin and expressed daily in our own lives is one that Karl Marx called commodity fetishism. Fetishism attributes life, autonomy, and
power to inanimate objects—dolls, sticks, places, or, in capitalism, money or other commodities. But commodity fetishism also performs another function. By attributing animate life to money, by speaking of it as if the money itself produces money, we mask and hide the actual manner in which money begets money—the exploitation of labor, land, and people. In this magical way of thinking, we begin to think of money as being able to generate value and yield interest in the same way that pear trees bear fruit or pigs bear piglets. The whole process of capital investment, making a profit, finding the cheapest labor, and so on, comes to appear natural because the real source of profits and the non-economic consequences of capitalism are largely hidden from view.
Money, however, does not produce money by itself. It requires other things, and this is where the Colombian peasant belief about the baptism of money is quite profound. Colombian peasants' practice of baptizing money so that it brings back more money is a rational interpretation of our own view of money but with one addition: for the Colombian peasant the process is immoral. It is immoral because it is money rather than the child that is baptized; profit can come only at the cost of the child's soul. In this way, the Colombian peasant is offering a critique of the capitalism that has been imposed on his society in the past century by the expanding world system.
These peasants are also posing key questions: How does capitalism perform its magic, converting money into more money, and do we pay a price for that conversion?
The Construction and Anatomy of the Working Class
As noted in Chapter 1, capitalism
involves interactions among three sets of people: consumers,
laborers, and capitalists, each doing what it is supposed, indeed has, to do.
The construction of the consumer took place largely in the twentieth century.
The nineteenth century witnessed the development of the working class.
Although the flowering of the consumer occurred largely in the
Characteristics of the Working Class
The new working class was unlike any that had existed before. Four characteristics of this new category of persons stand out: (a) members of this class were by necessity mobile, free to move to wherever workers were needed, unhampered by property or family connections; (b) they were segmented or divided by race and ethnicity, age, and gender; (c) they were subject to new kinds of discipline and control; and (d) they were militant, often protesting the conditions in which they were placed. Let's examine each of these characteristics in turn.
Labor Mobility. First, the new laborers were remarkably geographically mobile, moving temporarily or permanently to sources of employment. Most were mobile because they had been forced off their land or because the products they produced were no longer in demand. Take the situation of the Italian worker, for example. Beginning in the
Geographic mobility is one
characteristic of the laborer in the culture of capitalism. Here Chinese boys
await medical examinations at
1870s, the sale of public domain and church lands created a situation that allowed large landholders to add to their land, whereas small landholders were squeezed out as prices for agricultural products declined, in part because of the importation of Russian wheat. A blight destroyed many vineyards, and cheap imported goods disrupted local handicrafts. In the 1860s, some 16,000 people emigrated permanently; in the 1870s, the number grew to 360,000; between 1881 and 1901, the number rose to 2 million, 80 percent of whom were agricultural laborers.
The countries to which these
Italian migrants scattered, including
In 1890, the
source of the new immigration shifted to southern and eastern Europe and
consisted largely of displaced peasants from
indentured Chinese laborers were sent to
Segmentation. A second characteristic of the working class was that they were divided, or segmented, by race, religion, ethnicity, age, and gender. The new working class split into two broader categories: a labor aristocracy better able to defend its prerequisites through union organization and political influence, and workers who had to accept lower wages and less secure jobs. These divisions were often reinforced by the use of racial or ethnic distinctions that relegated certain groups such as Blacks and, earlier in the century, the Irish to only the lowest paying jobs. Capitalism did not create these racial and ethnic distinctions, but it did help in defining and reinforcing them and their economic consequences (Wolf 1982:380).
the ethnic identities of new immigrants rarely coincided with their self-identification. They first thought
of themselves as Hanoverians or Bavarians rather than Germans; as members of a village parish (okolica) rather than
Poles; as Sicilians, Neapolitans, and Genoans rather than Italians; and
The ethnic or
racial groupings created or reinforced by capitalist culture often came into conflict with each other as
they competed for scarce jobs and resources. The case of the Irish in
Every industrial and commercial
of the English domination in
the English working class, despite their organization.
Noel Ignatiev (1995), in his book, How
the Irish Became White, maintained that during
the first half of the nineteenth century in
Gradually, by taking the menial jobs that had been done by Blacks, as they were encouraged to do by priests, the Irish began to dominate the ranks of the unskilled laborer— by 1855, the Irish made up 87 percent of New York City's 23,000 unskilled laborers. In 1851, The African Repository, a magazine devoted to African American concerns, wrote (cited Ignatiev 1995:111) that
'White men will not work with him,' became the rallying cry of labor in elbowing out Blacks from jobs that were then taken over by Irish; as Frederick Douglass said, 'In assuming our avocation [the Irishmen] has assumed our degradation.'
The key to the distinction between White and Black became work; White meant doing 'White man's work,' while Black meant doing 'Black man's work.' The distinction was arbitrary because many jobs that became White man's work when reserved for Irish had been performed by Blacks earlier. 'White,' Ignatiev pointed out, was not a physical description, but rather a term of social relations. This distinction resulted, then, in a situation in which to be 'White' the Irish had to work in the jobs from which Blacks were excluded (Ignatiev 1995:111). Thus, a division of labor was hardened into a distinction of race and ethnicity.
The workforce was segmented in other ways, most notably by gender and age, with women and children assigned to the lowest-paying and most menial jobs. (A discussion of that development in more detail follows later.)
Discipline. The new working class was mobile and divided by race, ethnicity, gender, and age. In addition, it had to be disciplined. Central to this process was the factory. The
factory is a relatively recent
historical phenomenon, having developed largely in the late eighteenth and
early nineteenth centuries in
setting, for example, necessitated workers being disciplined to accept a new conception
of time. Time, another of the things we take for granted, is subject to cultural
definition. Our time is dictated, by and large, by our means of measuring
it—clocks and watches. Time in other societies tends to be task oriented or
dictated by natural phenomena:
in Madagascar, it might be measured by rice cooking (about one-half hour); in seventeenth-century Chile, the time needed to
cook an egg was the time it took to say an Ave Maria aloud; in Burma, monks
rose when there was enough light to see the veins in their hands; in
oceanside communities, the social patterning of time depends on the ebb and
flow of tides. British anthropologist E. E. Evans-Pritchard (1940:103), in his
classic account of the life of the Nuer of the
the Nuer have no expression equivalent to 'time' in our language, and they cannot, therefore, as we can, speak of time as thought it were something actual, which passes, can be wasted, can be saved, and so forth. I don't think they ever experience the same feeling of fighting against time because their points of reference are mainly the activities themselves, which are generally of a leisurely character. Events follow a logical order, but they are not controlled by an abstract system, there being no autonomous points of reference to which activities have to conform with precision. Nuer are fortunate.
Historian E. P. Thompson (1967) noted that until the institution of modern notions of time, work patterns were characterized by alternating bouts of intense labor and idleness, at least whenever people were in control of their own working lives. He has even suggested that this pattern persists today but only among some self-employed professionals, such as artists, writers, small farmers, and college students.
This is not to say that preindustrial work was easy. Thompson (1967:8) described the typical day of a farm laborer in 1636: He rose at 4 a.m., and cared for the horses, ate breakfast at 6 a.m., plowed until 2 or 3 p.m., ate lunch, attended to the horses until 6 in the evening, ate supper, did other chores till 8 p.m., cared for the cattle, and then retired. However, this was during the height of the laboring year on the farm, and it was probably the laborer's wife, says Thompson, who labored the hardest.
difficult to say precisely when the Western concept of time and work began to change. Clocks were not widespread
Time was an entity that should not be wasted. 'Time,' as Benjamin Franklin wrote in Poor Richard's Almanac, 'is money.' At about the same period, the idea that idleness was wicked began to gain currency. As Youth's Monitor phrased it in 1689, time 'is too precious a commodity to be undervalued. This is the golden chain on which hangs a massy eternity; the loss of time is insufferable, because irrecoverable' (quoted Thompson 1967:8). Leisure time, in general, was attacked; in some religious circles seeking amusement was considered to be sinful. Anything that did not contribute to production was discouraged.
At about the same time the school was being used to teach a new time and work discipline. Social reformers in the late eighteenth century suggested that poor children be sent at the age of four to workhouses where they would work and be given two hours schooling each day. As one person said,
There is considerable use in their being somehow or other, constantly employed at least twelve hours a day, whether they can earn their living or not; for by these means, we hope that the rising generation will be so habituated to constant employment that it would at length prove agreeable and entertaining to them, (cited Thompson 1967:84)
Thus, by the middle of the nineteenth century, through the supervision of labor, fines, bells and clocks, money incentives, preaching, and schooling, a new time discipline was imposed on society at large and on the laborer in particular.
Resistance. Finally, in addition to its mobility, segmentation, and discipline, the new working class was characterized by a new militancy that would lead to the closest thing the world has seen to a 'world revolution.' Early in 1848, the French political thinker and chronicler of American democracy, Alexis de Tocqueville, addressed the French Chamber of Deputies, saying what many Europeans feared. 'We are sleeping,' he said, 'on a volcano. Do you not see that the earth trembles anew? A wind of revolution blows, the storm is on the horizon' (cited Hobsbawm 1975:9).
At about the
same time, the thirty-year-old Karl Marx and his twenty-eight-year-old friend Friedrich Engels were
drafting the Manifesto of the Communist Party, which appeared in
Although they had the support of moderates and liberals in the various countries, they were, nevertheless, 'social revolutions of the labouring poor,' as Hobsbaum (1975:15) put it. The revolutions were an expression of developing patterns of conflict between the rich and poor, each group developing its spokespersons. On the one side were
people such as Jean-Baptiste Say
it is not in the power of the rich to supply the poor with an occupation and with bread, and consequently, the poor, by the very nature of things have no right to demand these things
from the rich_ No possible contributions of sacrifices of the rich, particularly in money,
could for any time prevent the recurrence of distress among the lower members of society, (cited Beaud 1983:78)
It is a matter of morality, said Malthus, that those who are poor must not produce children until they can adequately provide for them. To those who violate this rule, there should be no pity.
To the punishment, therefore of nature he should be left, to the punishment of want. He has erred in the face of a most clear and precise warning, and can have no just reason to complain of any person but himself when he feels the consequences of his error. All parish assistance should be denied him; and he should be left to the uncertain support of private charity. He should be taught to know that the laws of nature, which are the laws of God,
had doomed him and his family to suffer for disobeying their repeated admonitions It
may appear to be hard that a mother and her children, who have been guilty of no particular crime themselves, should suffer for the ill conduct of the father; but this is one of the invariable laws of nature. (Malthus 1826:343)
One French industrialist could write matter-of-factly that 'the fate of the workers is
not that bad: their labor is not excessive since it does not go beyond thirteen hours_ The
manufacturer whose profits are poor is the one to be pitied' (cited in Beaud 1983:101).
For others, such as Karl Marx and Friedrich Engels, society was being divided up into two hostile camps and classes—the bourgeoisie and the proletariat.
Masses of laborers, crowded into the factory, are organized like soldiers. As privates of the industrial army, they are placed under the command of a perfect hierarchy of officers and sergeants. Not only are they the slaves of the bourgeoisie class, and of the bourgeoisie State, they are daily and hourly enslaved by the machine, by the overlooker, and above all, by the individual bourgeoisie manufacturer himself. The more openly this despotism proclaims gain to be its end and aim, the more petty, the more hateful and the more embittering it is. (Marx and Engels 1848/1941:14)
The proletariat must, said Marx and Engels, embody the suffering, rise against it, and produce a classless society free from the exploitation of one class by another. It must free itself but only by transcending the inhumane conditions of present-day society. Marx had attempted in his writings to create a scientific theory of the fall of capitalism, in the
same way that Adam Smith and David Ricardo had tried to create a scientific theory of the rise of capitalism. The results were not only a blueprint to be used by union organizers and revolutionaries but also the creation of two Utopian ideologies—that of capitalism and that of socialism—which would do battle into the twentieth century.
These, then, are some of the characteristics of the laborer and the relationship between labor and capital as established in the nineteenth century. There were other features as well, such as the increased vulnerability of the laborer to hardship and the greater likelihood of impoverishment. To understand better how the laborer was constructed, let's turn to the contemporary world. In countries all over the world, the nineteenth-century processes through which the laborer was constructed are being repeated. We can see this most clearly in the growth of overseas assembly plants.
The Growth of Overseas Assembly Plants
In capitalism, profits and interest depend on the difference between the cost of producing a product and the price at which it is sold. If someone has a monopoly on a product, and if people need it, producers can charge as much as they need to to maintain or increase profits. But if other companies produce the same merchandise, it is likely that the price a company can charge will be determined by what others charge. Thus, Nike can charge one hundred dollars for its sneakers, but if its competitors are charging only forty dollars for the same product, Nike had better lower its price or face bankruptcy. Consequently, profit must come not from increasing the price that people pay but from controlling the cost of producing the product. Cost increase can be contained by controlling the cost of raw materials and machines—the means of production—or by controlling the price of labor.
The activity of work is common to all societies. In gathering and hunting societies, women and men spend a portion of their time gathering wild foods and hunting game, in pastoral societies people spend time herding and caring for animals, and in agricultural societies they work at tending fields, harvesting and storing crops, and so on. But work in the black box of capitalism takes a different form. In fact, some economists believe the key to understanding the way money creates more money is understanding the way labor figures in the production process. For them, profit comes directly from what they call the surplus value of labor.
As we noted earlier, to produce commodities for sale, labor must be purchased and combined with the means of production. For example, I might buy cloth and make shirts to sell. I may pay two dollars for the cloth and sell the shirt for ten, thereby making a profit of eight dollars. Where does that profit come from? One obvious place is the labor that went to convert the cloth into a shirt. In this case we might say the labor was worth eight dollars. But what if, instead of making the shirt myself, I paid someone else to do it, but paid him or her only two dollars, and still sold the shirt for ten. The value of the labor that went into making the shirt is still eight dollars, but the worker I hired received only two; I get to keep the other six dollars. It is this money that constitutes the surplus value of labor.
Obviously, then, one way for a company to maximize profits is to maximize the surplus value of labor and pay workers as little as possible. Another way to increase profits
is to get the laborer to produce more in the same period of time. Thus, if I paid my shirtmak-ers an hourly or daily wage, I could double my profits by getting them to produce two shirts in the time that they used to produce one shirt. This I could do by getting them to work faster or by improving the technology or process of shirt-making to make it more efficient.
Companies that produce commodities such as textiles, electronic goods, and toys are labor-intensive; that is, they require human labor more than improved technology to manufacture their products and are, consequently, always trying to minimize what they pay workers. Given the economic logic of capitalism this makes perfectly good sense: The more they save on labor costs and the less they charge for their product, the more they will attract consumers. Furthermore, the more they sell, the greater their profits and greater the return for investors and stock owners. Thus, the role of labor in the black box is critical to our understanding of the amount of profit the box can generate.
There are various
ways that producers can keep labor costs down. For example, they can import labor from
peripheral areas, particularly for low-paying jobs. In 2000, there were 15.7 million immigrant workers in the
in core countries, such as the
Although importing laborers from overseas worked for a time, corporations soon found that they could more easily tap into pools of cheap labor by relocating their manufacturing processes when possible to countries on the periphery of the world system whose governments were committed to economic development through industrialization. For example, to facilitate the establishment of assembly plants, governments in Indonesia, Malaysia, Guatemala, and Mexico, among others, created in their countries free trade zones, areas in which large corporations were permitted to deliver goods to be assembled—cut cloth for wearing apparel, electronic components, and so on—and for which they were not required to pay tariffs, provided that the items were not then sold in the country in which they were assembled. In exchange, the multinational corporations, such as Nike, agreed to hire local
workers. The home countries,
such as the
As an economic arrangement, almost everyone seems to benefit from the growth of assembly plants.
and other companies are able to compete with other manufacturers by paying
Workers in the
■ Consumers pay less for their clothes, electronic devices, toys, and so on.
■ Investors get a higher return on their money.
It seems that the only ones who don't benefit are the American workers who lose their jobs (some half-million in the textile industry alone in the 1980s).
As a result,
the growth in assembly plants was dramatic. In 1970 there were an estimated 1,000 women working in
in 1995, American labor and children's rights groups called for a boycott of
all garments assembled in
The Creation of Free Labor
One defining feature of capitalism is the creation of a class of people who are willing to sell their labor. There must be a working class and, subsequently, a demand for jobs. A
key question then is, why do people, particularly the workers, play the game of capitalism? For example, if the pay is poor and working conditions harsh, why do people work in assembly plants? Although the United States is and has been largely a wage economy in which the vast majority of people, in effect, sell their labor to companies, we sometimes forget, as mentioned earlier, that the existence of a so-called working class is a recent development historically in the United States, and particularly in countries such as Malaysia and Mexico where, until recently, most people earned their living from the land or from what they themselves produced and sold. Thus, to turn landed peasants and artisans into wage laborers required that they lose their land or sources of livelihood.
of land dispossession has continued to the present time (as will be discussed
later), not only in
factories, however, involve a paradox. In countries such as
The Segmentation of the Workforce
One consequence of the establishment of offshore assembly growth was the entrance into the labor market of a new working population of young, single women between the ages of sixteen and twenty-four. Why do the assembly plants choose to employ young women, and why is it that women choose to work under sometimes unpleasant conditions? The answer to this question requires us to understand how and why labor is segmented into different levels.
example, the case of
The idea that
women are somehow more suited biologically for assembly plant work is
widespread in developing countries. For example, here is what a brochure designed to bring foreign investments
Her hands are small and she works fast with extreme care. Who, therefore, could be better qualified by nature and inheritance to contribute to the efficiency of a bench assembly production line than the oriental girl? [Ong 1987: 152, emphasis added]
In Mexican maquiladoras the situation is much the same. Maria Patricia Fernandez-Kelly (1983) was also interested in the effects of the assembly plants on women. To study these effects she found a job in a maquiladora to share the experiences of the workers and to meet the women and learn about their lives. She, too, found that companies preferred to hire young females because managers believed that women have higher skill levels, are more docile, and are more willing to comply to the monotonous, repetitive, and exhausting assignments. Men are described by managers as more restless or rebellious, less patient, more likely to unionize, and less tolerant of the working conditions. As one manager related to Fernandez-Kelly (1983:181),
We hire mostly women because they are more reliable than men, they have finer fingers, smaller muscles and unsurpassed manual dexterity. Also, women don't get tired of repeating the same operation nine hundred times a day.
plants in both
There is also
a large population of unemployed women that assembly factories can choose from. In
Young women, such as these uniformed workers at a Nike assembly in Indonesia, comprise the vast majority of workers at overseas assembly plants.
American Chamber of Commerce that
the 30 percent unemployment rate in
another reason, however, for the employment practices of assembly plants, one that tells
us even more about the black box of capitalism: You don't have to pay women and children as much as you
have to pay men. Nor do you have to pay foreign workers as much as domestic workers. By extension you do not have to pay
people of color as much as you pay Whites. That is, the contemporary
labor force in peripheral countries such as
Let's return to basic economics. Modern industries can be loosely divided into two types. There are primary industries whose markets are well defined, whose profits are relatively certain, whose capital investment is high, and who are able to pay good wages and ensure decent working conditions. These industries include automobile manufacturing, communications, and energy industries, to name a few. They require a well-paid, well-trained, and relatively content workforce.
Then there are secondary industries that include the fast-food industry, agriculture, electronics, and, most notably, the clothing, garment, and/or textile industries. There is intense competition, uncertain or changing demand, a lower profit margin, and a greater dependence on unskilled labor in these industries. They are the least desirable for workers, because to stay competitive companies must pay the lowest wages and yet maximize worker output. These are the industries most likely to expand operations to poorer countries. They are also the companies that are likely to hire the most vulnerable and the lowest-ranking members of a population. Traditionally these people have been women, children, or members of subjugated minorities. Thus, when corporations locate assembly factories abroad, they are, in effect, expanding the secondary labor market.
Of course the hiring of women for
low-paying, labor-intensive work has long been a feature of industrial
capitalism. Women and children formed the bulk of the factory workforce at the
beginnings of the industrial revolution in the late eighteenth and early nineteenth centuries. In 1851, 31 percent of the
labor force in
This expansion of the secondary labor market abroad, however, has had the following economic consequences for workers and corporations at home and abroad:
1. It has meant the transfer of jobs abroad and resulting unemployment at home.
2. It has widened the gap between
primary and secondary labor in the
3. From the
perspective of workers in peripheral countries of the world system, it
has meant the development of poorly paid, unstable jobs with little opportunity
The process of
targeting the most vulnerable segment of the population for low-wage jobs also
affects the meaning that societies give to specific tasks. For example, the
division between skilled and unskilled jobs is often not based on the nature of
the work, as one would suppose; instead, it is based on who is doing the work.
In other words, the work that women do in assembly factories is not necessarily less
skilled than other work; it is considered unskilled because it is performed
by women. Fernandez-Kelly discovered this when she tried to learn the
sewing techniques of women in Mexican garment maquiladoras. She could
barely keep up with them; it required a skill level equal to or greater than
many jobs that we call skilled. In
From the standpoint of the corporation, however, the transfer of secondary jobs to underdeveloped countries and the ensuing expansion of a cheap labor reserve pool affords corporate employers the greatest degree of political and economic control over workers. They are able to employ the most socially vulnerable sector of the working class, the people least
likely to organize, demand better wages, or press for better working conditions. As one Mexican maquiladora worker put it, men are unwilling to perform the monotonous labor; women are more shy and submissive and are more used to following orders. They are more easily intimidated and forced to obey. They are the easiest to discipline.
In sum, for corporations women represent a major source of inexpensive, transient labor; thus, women, although making up the vast majority of assembly plant workers throughout the world, occupy few skilled or managerial positions. And because they occupy the lowest positions, women can be hired and fired, depending on the overseas demand for such things as textiles, shoes, plastics, electrical appliances, and, increasingly, electronics.
In spite of the often poor pay and harsh working conditions that women working in assembly plants endure, some economists and public policymakers argue that such employment is necessary if women are ultimately to gain access to better positions and change their often subjugated positions in societies around the world. They argue that the money that women earn gives them control over resources that they would otherwise not have, that as families become dependent on the income that these women bring into their households, their positions in society will improve. Some also argue that the creation of this kind of work is a necessary stage of economic development and will eventually lead to better lives for all. We must remember, however, that if the labor market remains divided between primary and secondary industries, then someone must continue to do the low-paying work. Women may escape low-paying jobs, but only, as the Irish in the nineteenth century learned, if there is another group to take their places.
Control and Discipline
For example, in turn-of-the-twentieth-century New York City, thousands of young women found employment in factories and used their new-found freedom and the wages they earned for shopping, dating, dancing, or going on excursions to recreation areas, such as Coney Island. However, their behavior alarmed some people who saw it as immoral; consequently groups of social reformers organized and proposed ways to 'protect' working women from these 'temptations.' Some of their solutions to the problem resulted in the formation of social and religious clubs and associations for young women, organizations such as the Young Women's Christian Association (YWCA).
These organizations also served another function as well; they relieved the fears of the parents of these young workers who otherwise might have been reluctant to allow them to migrate to cities and factory towns.
nineteenth-century America and Great Britain, employment in the new assembly
plants of such countries as Malaysia and Mexico often requires young men and
women to leave their homes and move to cities, freeing them from the
traditional constraints imposed by family and church, and, thus, freeing them to
spend their leisure time in nontradi-tional activities. Take, for
example, the situation of the largely female workforce in the new assembly
Because working women are now expected to save money to contribute to their own wedding expenses—money that had been traditionally supplied by their families—they feel justified in choosing potential spouses. Sexual freedom may be increasing, as indicated by an increase in abortions, and women are beginning to cross social boundaries, having 'illicit' relationships and marrying men of other ethnic groups (e.g., Chinese), something traditional family and church authorities would never have allowed.
consequence of the growth of the number of working women in
All of this has resulted in a call for greater control of working women, in spite of the fact that similar behavior, such as dating and movie going, among upper-class college students has not received the same notice. Even the academic community and religious and state officials have claimed to recognize the problem of declining morals of young women and proposed measures to arrest the decline, such as counseling and recreational activities. There have also been public calls for control of working women's leisure time, despite the fact that they tend to work about three hours a day more than women engaged primarily in traditional household chores.
In some ways, the newfound freedom of factory workers is as welcome by businesspeople as it is by the young. Their new income—and their willingness to spend a portion of it on themselves—has turned young village men and women into consumers who buy many of the products they make. But the new freedoms create yet another problem. Capitalist enterprise requires a disciplined and reliable workforce; with old forms of discipline falling away new forms must be developed to replace them. The question is, how is that done?
and church are largely absent from the lives of working young men and
women, factory managers try to use these traditional institutions to control
obligated to care for their children up to age fifteen, and traditional customs decree that children must also care for their parents. Thus children, particularly women, are obligated to return to their parents the care that their parents gave them. One of the major appeals made to young women by factory owners and managers is that they use their wages to pay back part of what they owe their parents.
Factory managers also seek to maintain discipline by building relations with people in the women's home villages, thus enlisting their help in controlling workers. For example, managers make donations to community organizations in the villages that supply workers. They also devise regulations to help parents monitor the activities of their daughters. When workers commute from their villages to the factories, the managers deliver workers to their homes by bus, or they allow parents to see overtime forms so they know how much time their daughters were spending at work and at other activities. These efforts enhance the prestige of managers in the eyes of village elders whose moral support could then be obtained for the social control of working daughters.
Corporations also use traditional family values to encourage workers to comply with company goals (Ong 1987:169). Thus managers tell workers that they are part of 'one big family.' One factory had posters proclaiming the company philosophy:
■ To create one big family
■ To train workers
■ To increase loyalty to company, country, and fellow workers
Managers portray themselves as parent figures to the larger community from which women workers come, and, although workers complain of too much control, parents rarely tell their daughters to quit.
Religion is also used as a means of discipline (Ong 1987:185). Because it is an Islamic country, the Malaysian government includes special departments and agencies that have jurisdiction over the application of religious law. For example, under the current interpretation of religious law, Muslims may be arrested for khalwat, 'close proximity' between a man and a woman who are not immediate relatives or married to each other. Those caught in situations that just suggest sexual intimacy, but not necessarily in the sex act, are fined or sentenced to jail for a few months. Muslims arrested for zinah, that is, illicit sexual intercourse, may be more severely punished. As a result of the increase in the number of young women working in assembly factories, there have been more raids by the government's Religious Department on the poor lodgings and cheap hotels used by the workers.
Then there is the factory discipline itself. We mentioned earlier that eighteenth- and nineteenth-century factories were modeled after prisons. Modern assembly plants have much the same character. In Malaysian assembly plants, workers are sometimes watched through glass partitions. In one factory, for example, three supervisors and twelve foremen controlled 530 operators. Discipline was verbally enforced as women workers were scolded by over-vigilant foremen for wanting to go to the prayer room, the clinic, or the toilet. Some foremen would even question workers in a humiliating manner about their menstrual problems or nonwork activities. Others were reported to have forced women to
run laps around the assembly plant as a form of punishment for reporting late to work or not meeting their production quotas.
As in prisons, clothing can be used to instill discipline. Malaysian workers are required to wear factory overalls that they complain are too tight and which they are not allowed to unbutton. They are also required to wear heavy rubber boots. These clothes are very different from the loose-fitting clothes and sandals Malaysians traditionally wear while working.
plants also bring with them a Western, factory-oriented sense of the relationship between work and time to
which contemporary assembly workers must adapt. Traditionally in
Female workers in the factories, however, are clocked in daily for eight consecutive hours with two fifteen-minute breaks and a half-hour lunch break. Every month their work schedules are changed. Women begin to divide their lives into 'work time' and 'leisure time.' They were watched over by overzealous foremen, screened before they could leave their work benches to go to the toilet, and fined if they were late for work (in spite of the fact that pay was based on piecework). This is in vivid contrast to the traditional work routine where there was no distinction between work and life and no conflict between labor and 'passing the time of day.'
Resistance and Rebellion
Capitalism requires a disciplined working class—people willing to work for wages that allow enterprises to make their necessary profit. But herein lies a problem: in general, people do not readily accept discipline and control and will seek a way to resist, either directly or indirectly.
Resistance to capitalist discipline
can take direct forms, as in worker protests, formation of unions, and even revolution (subjects to be examined in later
chapters). Resistance may also take the form of a moral critique, such as that
of Colombian peasants who see capital accumulation represented in the baptism of
money as the loss of a child's soul. Such
indirect forms of resistance are not unique to the peoples of the periphery of
the world system. For example, one
of the stories that comes down to us from early industrial
about people's beliefs. Often they are morality tales
that dramatize the consequences of proper or
improper behavior. Jane Schneider (1989), for example, suggested that the meaning
of the Rumpelstilskin tale lies in the development of the linen industry in
In one version of the Rumpelstilskin story, a father brags that his daughter is able to spin straw into gold. The king, hearing of this boast, offers to take the girl as his wife if she is able to spin the straw in his castle into gold. The girl, tries, fails, then enters into a pact with a strange dwarf who promises to spin the straw into gold for her, but only if she promises to give him her firstborn child. The girl accepts, Rumpelstilskin spins the gold, and she marries the king and has a child. The dwarf comes to claim his fee but is distressed by her tears and grief and offers her a way out. If she can guess his name, he will free her from the contract.
We have forgotten much of what this tale meant to sixteenth- and seventeenth-century European peasants. For example, one of the main industries of the period was linen production. Linen was produced by spinning flax straw into linen thread that was woven into a fabric that was sold for gold coins. So straw, in effect, really was spun into gold. Moreover the spinning process was performed largely by young women. A woman's spinning skill was not only a source of money, it was a quality men sought in wives—as the king sought in his future wife. Furthermore the story contains a pact with a demon, and the price is the firstborn. Thus, as in the Colombian baptism of money, we find the symbolic statement that the generation of wealth comes only with social and personal sacrifice, often of children or their souls.
Malaysian assembly plant workers
have also found a subtle, generally symbolic means
of expressing their resistance to capitalist discipline. It takes the form of
spirit possession. Although
Another American microelectronics factory was closed down when fifteen women were possessed. According to factory personnel officers, possessed girls began to sob and scream hysterically. When it looked as though the possession would spread, the other workers were immediately ushered out. The women explained that the factory was 'dirty' and consequently haunted by a datuk.
universe is still full of spirits moving between the human and nonhuman domain. Spirit possession seemed to
express themes of filth, angry spirits, and fierce struggles. Particularly
prominent in the possession episodes were spirits, such as toyal, who help their masters gain wealth out of thin
air; and the
Aihwa Ong suggested that the women were not reacting to anything as abstract as industrial capitalism but against a sense of violation, of a dislocation in human relations,
in much the same way the Colombian peasants reacted to wage labor with the notion of the baptism of money and the sacrifice of children's souls.
Beliefs about the baptism of money
A major assumption of this book is that it is impossible to understand the modern world and its problems—population growth, hunger, poverty, environmental degradation, health, war, religious fundamentalism, and so on—without an understanding of the capitalist economy that, with its goal of accumulating more and more wealth, has in the past four to five centuries redefined and created new social and cultural forms and altered traditional cultural institutions to serve its own purposes. Capitalism has been characterized here as a black box whose purpose it is to convert money into more money, to take monetary investments and convert them into profits and interest. For most people, this process is as magical as is the behavior of baptized money among Colombian peasants. They place money in banks, stocks, or other investments and expect to get more money back without ever questioning the process through which this conversion occurs.
We began to examine how the black box performs its conversion by looking at the growth of overseas assembly plants and the creation, segmentation, and disciplining of the labor force necessary for the box to function at its greatest efficiency. Historically, free labor has been created by removing people from the land or destroying the small-scale industry that allowed them to support themselves. In different countries this was done in different ways, but the overall result has been the creation of populations whose sole means of support is in the sale of their labor. This is as true in industrialized countries as it is in developing or undeveloped countries. In fact, all of us who depend on wage employment—from nuclear physicists to garment workers—constitute the pool of 'free' labor. This labor pool is further divided along a continuum comprising at one end relatively well-paid, desirable jobs in industries or enterprises that require a well-trained workforce, and at the other end relatively low-paying, undesirable jobs in industries that are highly competitive and dependent on the existence of a cheap labor supply. Industries and enterprises that depend on a cheap labor supply are able to take advantage of social divisions and discrimination that generally follow lines of gender, race, age, and country of origin to minimize labor costs and control the labor force.
In creating or taking advantage of the increasing supply of cheap labor, the capitalist economy must also develop ways to maintain workforce discipline, which it does through the factory system, the redefinition of time, and the use of traditional institutions such as the family and the church. Yet in spite of the new forms of discipline, workers offer resistance in the indirect form of masked criticism—as in the baptism of money, spirit possession, or moral tales such as that of Rumpelstilskin—or in the direct forms, protest and the organization of unions.
The mobility, segmentation, and disciplining of the workforce is, of course, only one feature of modern capitalism, and an examination of labor is only the beginning of an understanding of how the black box is able to transform money into more money. It is necessary to examine other components. In order to do so, let us turn to other major questions: How did the entire system develop historically? How did the black box evolve to where it is today? Most specifically, how and why did the capitalist evolve from the merchant trader?
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