Wages versus [Austrian Economics and] Wage Slavery

Wages versus Wage Slavery

One of the ongoing roadblocks to left and libertarian reconciliation, one which deserves more of our attention, is the matter of conflation of context with causality, an intellectual error committed by most on both sides.

Leftists typically blame markets for state-caused injustice that takes place in markets.

Free-market libertarians often apply a shallow analysis that causes them to defend state-caused injustice merely because its visible manifestation is in the marketplace.

Both fail to recognize that the market is the context, the cause is the state.

Let’s look at the topic of wage slavery, for example.

Every marginalized worker viscerally knows wage slavery to be a very real phenomenon — yet libertarians typically bury their heads in the sand and leftists typically fundamentally misunderstand the problem.

Most libertarians deny the existence of wage slavery, seeing only the voluntaristic nature of the concept of wages in principle rather than the real world of state-tainted injustice in practice.

Most radical leftists attack the voluntaristic nature of the concept of wages, assuming there is something inherently evil about wages for reasons that are mirror images of the intellectual errors commonly committed by libertarians.

They’re both right and both wrong.

deeper libertarian analysis, a left libertarian analysis, points to the role of the state in artificially concentrating capital in the hands of state-allied big business — giving statist plutocrats far more bargaining power in the labor market than is their natural due. Injustice happens to play out in the marketplace, but the cause is the state.

I urge, and challenge, free-market libertarians to show their solidarity with labor by supporting radical unions such as the Industrial Workers of the World (IWW), rather than establishment unions in league with big business and the state. Click here to join the IWW.

Austrian Economics and Wage Slavery

Since the post on wage slavery generated a bit of a stir, perhaps it’s time to introduce a $10 word for the fifty cent concept of “screw the workers“.

That word is oligopsony. Just as the word “oligopoly” is a more dispersed form of the concept of “monopoly”, so to oligopsony complements monopsonyMonopsony, in turn, is a mirror image of monopoly. Where a monopoly indicates only one seller, monopsony indicates one buyer.

The essence of what I had to say about the concept of wage slavery is that the government-induced cartelization of industry creates oligopsony conditions in the labor market. It does this by artificially reducing the number of buyers of labor (businesses), thereby granting the existing ones an unnatural degree of bargaining power.

Austrian economics is quite clear on the cartelizing effects in the business world of statism. By pointing to statism as the cause of resulting oligopsony conditions in the labor market, a compelling case can be made that the completely free market (i.e. anarchy) truly is the proletarian revolution.