The Economic Basis Of The Third Universal Theory

Part 2: The Solution of the Economic Problem: Socialism

Important historical developments contributing to the solution of the problem of work and wages – the relationship between producers and owners, workers and employers – have occurred in recent history. These developments include the determination of fixed working hours, overtime pay, leaves, minimal wages, profit sharing, the participation of workers in administration, the banning of arbitrary dismissal, social security, the right to strike, and other provisions contained in labour codes of almost all contemporary legislation. Of no less significance are changes in the realm of ownership, such as the enactment of laws transferring private ownership to the state, and also those limiting income. Despite these not inconsiderable developments in the history of economics, the problem still fundamentally exists, even though it has been made less severe than in past centuries through improvements, refinements and developments that have brought many benefits to the workers.

However, the economic problem still persists unsolved in the world. Attempts aimed at ownership have failed to solve the problems of producers. They are still wage-earners, despite the state ownership which may vary from the extreme right to the extreme left to the centre of the political spectrum. Attempts to improve wages were equally significant to those that were aimed at the transferral of ownership. In the wake of the Industrial Revolution, benefits from wage negotiations secured for workers certain privileges that were guaranteed by legislation and protected by trade unions, thus improving the lot of the workers. As time passed, workers, technicians, and administrators have acquired certain rights which were previously unattainable. However, in reality, the economic problem still exists.

Attempts that were aimed at wages were contrived and reformative, and have failed to provide a solution. They were more of a charity than a recognition of the rights of the workers. Why do workers receive wages? Because they carry out a production process for the benefit of others who hire them to produce a certain product. In this case, they do not consume what they produce; rather, they are compelled to concede their product for wages. Hence, the sound rule: those who produce consume. Wage-earners, however improved their wages may be, are a type of slave.

Wage-earners are but slaves to the masters who hire them.

They are temporary slaves, and their slavery lasts as long as they work for wages from employers, be they individuals or the state. The workers’ relationship to the owner or the productive establishment, and to their own interests, is similar under all prevailing conditions in the world today, regardless of whether ownership is right or left. Even publicly-owned establishments give workers wages as well as other social benefits, similar to the charity endowed by the rich owners of economic establishments upon those who work for them.

Unlike the privately-owned establishment where income benefits the owner, the claim that the income from the public-owned establishment benefits all of the society, including the workers, is true only if we take into consideration the general welfare of the society and not the private well-being of the workers. Further, we would have to assume that the political authority controlling ownership is that of all the people, practised through the Popular Conferences and People’s Committees, and not the authority of one class, one party, several parties, one sect, tribe, family, individual, or any form of representative authority. Failing this, what is received directly by the workers with respect to their own interests, in the form of wages, percentage of profits or social benefits, is the same as that received by workers in a private corporation. In both instances, the producers are wageearners, despite the difference in ownership. Thus, this change in ownership has not solved the problem of the producer’s right to benefit directly from what he produces, and not through the society nor through wages. The proof thereof is the fact that producers are still wage-earners despite the change in this state of ownership.

The ultimate solution lies in abolishing the wage-system, emancipating people from its bondage and reverting to the natural laws which defined relationships before the emergence of classes, forms of governments and man-made laws. These natural rules are the only measures that ought to govern human relations.

These natural rules have produced natural socialism based on equality among the components of economic production, and have maintained public consumption almost equal to natural production among individuals. The exploitation of man by man and the possession by some individuals of more of the general wealth than their needs required is a manifest departure from the natural rule and the beginning of distortion and corruption in the life of the human community. It heralds the start of the exploitative society.

If we analyse the factors of economic production from ancient times to the present, we always find that they essentially consist of certain basic production components, i.e., raw materials, means of production, and a producer. The natural rule of equality requires that each of these components receives a share of this production. Because production cannot be achieved without the essential role of each of these components, it has to be equally divided amongst them.

The preponderance of one of them contravenes the natural rule of equality and becomes an encroachment upon the others’ rights. Thus, each must be awarded an equal share, regardless of the number of components in the process of production. If the components are two, each receives half of the production; if three, then one-third. Applying this natural rule to both ancient and modern situations, we arrive at the following. At the stage of manual production, the process of production resulted from raw material and a producer. Later, new means of production were added to the process. Animals, utilized as power units, constitute a good example. Gradually, machines replaced animals, types and amounts of raw materials evolved from the simple and inexpensive to the valuable and complex. Likewise, the unskilled workers became skilled workers and engineers; their former huge numbers dwindling to a few specialized technicians.

Despite the fact that components have qualitatively and quantitatively changed, their essential role in production has remained basically unaltered. For example, iron ore, a component of both past and present production, was manufactured primitively by iron smiths into knives, axes, spears, etc. The same iron ore is now manufactured by engineers and technicians by means of smelting furnaces into all kinds of machines, engines and vehicles. The animal - horse, mule, camel, or the like – which was a component of production, has been replaced by factories and huge machines. Production, based upon primitive tools, is now founded upon sophisticated technical instruments. Despite these tremendous changes, the components of natural production remain basically the same. This consistency inevitably necessitates returning to sound natural rules to solve the economic problems that are the result of all previous historical attempts to formulate solutions that ignore these rules.

All previous historical theories tackled the economic problem either from the angle of ownership of any of the components of production, or from that of wages for production. They failed to solve the real problem; the problem of production itself. Thus, the most important characteristic of economic order prevailing in the world today is a wage system that deprives the workers of any right to the products being produced, be it for the society or for a private establishment.

An industrial establishment is composed of material for production, machines and workers. Production is achieved by workers manufacturing materials and using machines. Thus, manufactured goods would not have been ready for use and consumption had they not gone through a production process requiring raw materials, factories, and workers. Clearly, without basic raw materials, the factory cannot operate and without the factory, raw materials will not be manufactured. Likewise, without producers, the factory comes to a halt. Thus, the three factors are equally essential to the process of production, and without them there can be no production. The absence of any one of these components cannot be replaced by the others. Therefore, the natural rule necessitates each component receiving an equal share of the benefits of production. It is not only the factory that is important, but those who consume its production as well. The same is applicable to agricultural production processes resulting from only two components: man and land. The product must be divided equally into two shares congruent with the number of production components. Furthermore, if any additional mode, mechanical or otherwise is utilized in the process, production must be equally divided into three shares: the land, the farmer, and the means of production. Consequently, a socialist system emerges under which all production processes are governed by this natural rule.

The producers are the workers; they are called producers because the terms “worker,” “labourer,” and “toiler” have become invalid. The traditional definition is revised because workers are undergoing qualitative and quantitative changes. The working class is declining proportionately to the advancement of science and technology.

Tasks once performed by a number of workers are now being carried out by a single machine. Operating a machine requires fewer workers; this has brought about a quantitative change in the labour force, while the replacement of physical force by technical skill has resulted in a qualitative change in the labour force.

The labour force has become a component of the production process. As a result of technical advancement, multitudes of unskilled toilers have been transformed into limited numbers of technicians, engineers and scientists. Consequently, trade unions will subsequently disappear and be replaced by syndicates of engineers and technicians. Scientific advancement is an irreversible gain for humankind. Thanks to this process, illiteracy will be eliminated and unskilled workers will become a temporary phenomenon destined to gradual disappearance. However, even in this new environment, persons will always remain the basic component in the production process.