Productive vs Unproductive Labour

Production vs Services

¹ Productive labour adds value while unproductive labour does not. The labour of a manufacturer adds to:

• the value of the materials which he works on,
• the value of his own maintenance, and
• the value of his master’s profit.

On the contrary, the labour of a menial servant adds to the value of nothing.

The manufacturing worker costs nothing to his employer even though the employer pays his wages.

• This is because the value of his wages is restored with a profit in the improved value of his manufactured products.

But the maintenance of a menial servant never is restored.

A man grows rich by employing many manufacturers.

• He grows poor by maintaining many menial servants.

However, the labour of servants has its value.

• It deserves its reward as well as the manufacturers.

But the manufacturer’s labour realizes itself in some vendible commodity which lasts for some time after that labour is past.

• The vendible commodity stores his labour for future use.
• The price of that vendible commodity can afterwards mobilize labour equal to the labour which originally produced it*.

On the contrary, the labour of the menial servant, does not realize itself in any vendible commodity.

His services generally perish after their performance. It seldom leaves any value behind for which an equal quantity of service could afterwards be procured.

² The labour of some of the most respectable orders in the society is like the labour of menial servants.

• It is unproductive of any value.
• It does not fix or realize itself in any permanent subject or vendible commodity.
• It does not endure after that labour is past to command an equal quantity of labour afterwards.

Examples of unproductive labourers are=

• the sovereign and all his officers,
• the whole army and navy, and
• public servants.

They are maintained by a part of the produce of other people’s industry.

• Their honourable, useful, or necessary service produces nothing for which an equal amount of service can afterwards be procured.
• The protection, security, and defence of the nation which they bring this year will not buy its protection, security, and defence next year.

The gravest, most important, and some of the most frivolous professions are unproductive=

• Churchmen, Lawyers, Physicians, all Men of letters
• Players, buffoons, musicians, opera-singers, opera-dancers, etc.

Their labour has a certain value regulated by the same principles which regulate other kinds of labour.

The noblest and most useful professions produces nothing which could afterwards buy an equal amount of labour. Their work perishes in the very instant of its production* similar to:

• the actor’s declamation,
• the orator’s harangue, or
• the musician’s tune.

*Superhysics Note: We call this as Material and Immaterial Work instead

³ Productive and unproductive labourers*, and those who do not labour at all, are all equally maintained by the national produce.

This national produce has certain limits. It rises or falls depending on how much of it is employed to maintain productive or unproductive hands [material and immaterial workers].

• The whole annual produce, except for the spontaneous productions of the earth, is the effect of productive labour [material work].

⁴ The whole annual produce of the land and labour of every country is ultimately destined:

• for supplying the consumption of its inhabitants, and
• for procuring a revenue to them.

But when the produce first comes either from the ground or from productive labourers, it naturally divides itself into 2:

1. The produce that resupplies a capital

• This is frequently the larger part of the two and is used for renewing the provisions, materials, and finished work used to make that produce.

2. The produce that serves as profits or rent

• Thus, in agricultural produce:
  • one part resupplies the farmer’s capital,
  • the other part pays his profit and the rent of the landlord.

In a manufactured product:

• the largest part resupplies the entrepreneur’s capital,
• the other part pays his profit.

⁵ The part of the national produce which resupplies capitals immediately, onlymaintains productive labour.

It pays the wages of productive labour only. The part of the national produce which immediately pays for profit or rent, may maintain productive or unproductive hands indifferently.

⁶ A man who employs his stock as capital always expects it to be replaced with a profit.

Therefore, he employs it in maintaining productive hands only. After serving as a capital to him, it becomes a revenue to them. Whenever he employs his stock to maintain unproductive hands, it is immediately withdrawn from his capital and placed in his stock for consumption.

⁷ Unproductive labourers and those who do not labour at all, are all maintained by revenue.

Part of this revenue is from:

• the profits or rent of some other persons, or
• the produce which:
  • resupplies capital, and
  • maintains productive labourers only.

After they receive their wages, they spend the excess to maintain either productive or unproductive labour.

Thus, even the common worker who has high wages may maintain a menial servant.

• He might go to a play or a puppet show and contribute to maintain unproductive workers.
• He may pay some taxes and help maintain a more honourable and useful set of equally unproductive workers.

However, the produce which resupplies a capital does not maintain unproductive labour until it has mobilized all the productive labour it could employ.

The worker must have earned his wages before he can use his spare revenue to maintain unproductive labour.

• This spare revenue is generally small.
• In the payment of taxes, their great numbers may compensate their smallness.

Therefore, the rent of land and the profits of stock are everywhere the principal sources from which unproductive hands get their subsistence.

Owners generally have rent and profits to spare.

• They might maintain productive or unproductive hands indifferently.
• They seem to have some predilection for unproductive hands.

A great lord’s expence generally feeds more idle than industrious people.

The rich merchant only maintains industrious people with his capital. But he commonly spends to feed unproductive hands, similar to the great lord.

⁸ The proportion between the productive and unproductive labour depends very much on the proportion between:

• the produce destined for replacing a capital, and
• the annual produce destined for rent or profit.

This proportion is very different in rich countries from that in poor countries.

Feudalism Creates Poverty by Reducing Productivity

⁹ In opulent European countries, the largest portion of the produce of the land resupplied the capital of the rich and independent farmer. The other portion paid for:

• his profits and
• the landlord’s rent.

But in feudalism, a very small portion of the produce was enough to replace the capital employed in cultivation. It commonly consisted in a few wretched cattle maintained by the spontaneous produce of uncultivated land. That spontaneous produce might not even be considered part of the country’s produce.

All the produce of the land generally belonged to the landlord, who advanced it to the occupiers of the land who were generally bondmen owned by the landlord.

Those who were not bondmen were tenants-at-will.

• The tenants-at-will paid a rent which was nominally a little more than a quit-rent.
  • The quit-rent really amounted to the land’s whole produce.
• Their lord could always command their labour, in peace or war.
• They were equally dependent on him as the retainers who lived in the landlord’s house.

All of the land’s produce belongs to a single person if he can do 100% of the labour himself.

Rent Increases in Value, But Decreases Its Share in the Economy as a Nation Develops

Presently in Europe, the landlord’s share sometimes does not exceed 25% of the produce of the land.

• The rent of land in all the improved parts of the country has quadrupled since those ancient times.
• This 25% of the produce is 4x greater than the whole produce before.

In the progress of improvement, rent:

• increases in proportion to the productivity of the land, but
• decreases its share in proportion to that productivity.

¹¹ In the opulent European countries, great capitals are presently employed in trade and manufactures.

The present interest rate in the improved parts of Europe is never higher than 6%.

In the ancient state, very small capitals were needed for the little trade and the few homely and coarse manufactures. However, these must have yielded very large profits.

• The interest rate was never less than 10%
• Their profits must have been sufficient to afford this great interest.
• In some of the most improved parts, it is as low as 2-4%

The profits of stock is always much greater in rich than in poor countries because the stock is much greater. In proportion to the stock, the profits are generally much less.

¹¹ The part of the annual produce for resupplying a capital and maintaining productive labour is much greater in rich than in poor countries.

• It takes a much bigger proportion than the part which becomes rent or profit which maintains unproductive labour.

¹² The proportion between those different funds determines the industry or idleness of a country’s inhabitants.

The inferior ranks such as the elderly, are maintained by the expence of=

• the courts of justice, and
• those who plead before them.

They are generally idle and poor. In towns principally supported by the residence of a court, the poor are chiefly maintained by the spending of revenue.

• The inferior ranks are generally idle, dissolute, and poor as in Rome, Versailles, Compiegne, and Fontainebleu.
• There is little trade or industry in any of the French parliament towns, except for Rouen and Bordeaux.

In contrast, in commercial and manufacturing towns, the poor are chiefly maintained by the employment.

• They are generally industrious, sober, and thriving as in many English and in most Dutch towns.

Our ancestors were idle for the lack of encouragement to industry. The proverb says=

We are more industrious than our forefathers because the funds presently maintaining industry are much greater than the funds maintaining idleness, compared with the funds 200-300 years ago*.

The great trade of Rouen and Bordeaux is due to its location.

• Rouen is the entrepôt of almost all the goods destined for Paris. These are brought from=
  • foreign countries, or
  • the French maritime provinces.
• Bordeaux is also the entrepôt of the wines from the Garonne river.
  • It is one of the richest wine countries in the world.
  • It produces the wine fittest for exportation.

Such advantageous locations attract a great capital by the great employment they afford. The employment of this capital is the cause of the industry of those two cities.

In the other French parliament towns, a little more than the smallest capital is employed above what is needed for their own consumption.

The same thing may be said of Paris, Madrid, and Vienna. Paris is by far the most industrious of those three cities

• It is the principal market of all the manufactures of Paris.
• Its own consumption is the principal object of all its trade.

London, Lisbon, and Copenhagen, are perhaps the only three European cities which are both trading cities and the constant residence of a court.

Trading cities trade for the consumption of other countries and their own. The location of those three cities is extremely advantageous.

• It naturally fits them to be the entrepôts of the goods destined for distant places.
• It is probably more difficult to employ a capital in a city where a great revenue is spent for consumption, than in a city where poor people must find their own ways to employ their capitals to maintain themselves.

The idleness of people maintained by the expence of revenue probably corrupts the industry of productive people. It probably makes it less advantageous to employ a capital there. There was little trade or industry in Edinburgh before the union.

When the Scotch Parliament was no longer to be assembled in it, it ceased to be the residence of the principal nobility of Scotland.

• It became a city of some trade and industry.
• It is still the residence of the principal courts of justice in Scotland, of the Boards of Customs and Excise, etc.
• A big revenue is still spent in it.
• It is much inferior to Glasgow in trade and industry.

Glasgow’s inhabitants are chiefly maintained by the employment of capital. A large village, which has progressed in its manufactures, becomes idle and poor after a great lord takes up his residence in it.