China on Monday criticised European Union plans to shield key industries from Chinese competition, warning it would take countermeasures if the measures are adopted. The EU’s proposed “Made in Europe”…
Your idea that profit is simply the extraction of value from those doing the work ignores the role of risk. The factory owner provides the initial capital, buys the machines, secures supply chains, finds the right workers, organizes everything and takes the risk of bankruptcy. If the company fails, the workers lose their jobs, but the owner loses their investment. Therefore profit is the reward for taking on that financial risk and organizing the resources efficiently. Also, some of that profit will need to be reinvested into the factory or new factories.
The factory owner supplies the capital, and hires a factory manager to hire all of the people to buy machines, secure supply chains, find the right workers, organize everything, etc.
They do very little of the work, except in cases of owner-operated businesses which I’d just consider self-employment. In return for this small amount of effort and however much capital investment, they usually take a large salary, dividends, and take advantage of a range of benefits.
There is some degree of risk, of course, but the risk (liability) is limited by the LLC (limited liability company), so the owner cannot lose more than they invest.
Many risks can be hedged against using a number of strategies, such as insurance and diversification.
The rewards, on the other hand, are unlimited and infinite, and if the business isn’t performing as well as is liked, it can be liquidated to reclaim much of the original capital expenditure. Many industries - especially industries such as mentioned in the OP - will be bailed out by the State if they do fail, completely insulating the capital owner from risk.
Meanwhile, the employees have significantly higher risks, for example, being killed or injured as part of an workplace accident, which happens far more often than bankruptcy.
Capitalism is a system of exploitation, where the wealthy get wealthier over time, at the expense of everyone else. It inevitably leads to fascism. It must be dismantled.
Your idea that profit is simply the extraction of value from those doing the work ignores the role of risk. The factory owner provides the initial capital, buys the machines, secures supply chains, finds the right workers, organizes everything and takes the risk of bankruptcy. If the company fails, the workers lose their jobs, but the owner loses their investment. Therefore profit is the reward for taking on that financial risk and organizing the resources efficiently. Also, some of that profit will need to be reinvested into the factory or new factories.
The factory owner supplies the capital, and hires a factory manager to hire all of the people to buy machines, secure supply chains, find the right workers, organize everything, etc.
They do very little of the work, except in cases of owner-operated businesses which I’d just consider self-employment. In return for this small amount of effort and however much capital investment, they usually take a large salary, dividends, and take advantage of a range of benefits.
There is some degree of risk, of course, but the risk (liability) is limited by the LLC (limited liability company), so the owner cannot lose more than they invest.
Many risks can be hedged against using a number of strategies, such as insurance and diversification.
The rewards, on the other hand, are unlimited and infinite, and if the business isn’t performing as well as is liked, it can be liquidated to reclaim much of the original capital expenditure. Many industries - especially industries such as mentioned in the OP - will be bailed out by the State if they do fail, completely insulating the capital owner from risk.
Meanwhile, the employees have significantly higher risks, for example, being killed or injured as part of an workplace accident, which happens far more often than bankruptcy.
Capitalism is a system of exploitation, where the wealthy get wealthier over time, at the expense of everyone else. It inevitably leads to fascism. It must be dismantled.