What Did Marx Mean When He Talked About Exploitation and Surplus Value?

Marx argued that the expropriation of surplus value by capitalists is the main source of the oppression and exploitation of the members of the working class. What is surplus value, how is it expropriated, and why is this expropriation exploitative? Capitalists are the owners of the forces of production (machines, soil, buildings, infrastructure, etc.). This exclusive ownership implies the monopolization of the means of labor, and this implies the monopolization of the sources of life.

A monopoly like this doesn’t merely create dependence and therefore precarity for workers; it also means exploitation. Workers are exploited because the surplus value — a worker creates more value in a day than he gets paid — is taken by the capitalist. Or, in other words: the wages of the laborer have a smaller exchange value than the exchange value of the object he or she produces. The object is sold by the capitalist, who buys labor and pockets the difference. A typical worker produces values that exceeds the reimbursement of their labor. A worker works more than the hours necessary to embody in his product the value of his labor power.

For example, if the value of labor power, i.e., the wage, is $50 a day, and a worker produces a good (or goods) which is worth $100 during a full day of work, then the second half of the day would yield surplus value, in this case another $50.

The expropriation of this surplus value is theft, because the capitalist takes something which he has not produced. He or she takes the unpaid labor and products of someone else and lives on the back of someone else, simply because of the privilege of owning the means of production. The workers have to accept this because they depend on the capitalist. They have to sell their labor power in order to survive because they do not own means of production and hence can’t produce and live without the consent of the capitalists. As the workers’ energy is not depleted after their own reproduction is guaranteed — through the payment of a wage — one can use it to produce more.

Moreover, the capitalist continuously tries to maximize this surplus value. There are two means to achieve this maximization. First, technology and science increase productivity and diminish the necessary labor time per unit of production. Machines make it possible to produce more with less labor. If wages stay constant and productivity goes up, then surplus value goes up.

But wages, of course, do not stay constant. The capitalist also tries to make labor as cheap as possible and the working day as long as possible. This is another kind of oppression, different from but inextricably linked to the expropriation of surplus value. This is achieved by way of the so-called “industrial reserve army”. This is a relatively large group, constantly available but not necessarily made up of the same people. They are perhaps unemployed, or working for peanuts in the developing world, or perhaps they are children. And they are desperate for (better paid) work, ready to replace the (elsewhere) employed and ready to accept a lower wage and a longer working day. This reserve army is a millstone round the neck of the proletariat, a regulator keeping wages at a low level.

The capitalist accumulates surplus value and wealth, and the worker accumulates misery. This “immiserization” (“Verelendung”) of the proletariat is something relative: it’s the gap in resources between those who own the means of production and those who don’t that will widen.

This maximization of surplus value deepens social divisions, brings despair to the workers, and hence will ultimately contribute to the collapse of capitalism, or so Marx believed.

When Rights Become Wrongs

Some presumptive rights are in fact making things worse for people. A “right not to be exploited” can condemn the potential victims of exploitation to other kinds of victimhood that are even harder to bear than exploitation. Take for example some kinds of sweatshop laborers and child laborers. Mutually beneficial exploitation is real, and, while it’s definitely immoral it may still be better than the status quo ante. If children aren’t allowed to work or sweatshops are closed under pressure then people’s lives may well turn for the worse. More poverty or worse labor conditions – e.g. prostitution or slavery – can be their lot.

Something similar is the case for the so-called right to cultural identity. This right may very well force some members of cultural communities to endure cultural practices that are harmful to their individual rights, all in the name of preserving the cultural identity of the group. Another example: the “right to land” is often invoked in certain developing countries and is supposed to be a means to undo the unjust distribution of land ownings following a history of white colonialism. Here as well we see that a right may become a wrong: while it may undo one injustice of distribution it creates other injustices (e.g. poverty resulting from ineffective production due to losses of economies of scale and of knowhow).

One last example: immigration restrictions are sometimes justified by the claim that would-be immigrants have a right to flourish in their countries of origin. People don’t want to migrate unless they’re forced by circumstances, it is said. Relaxation of immigration laws is then supposedly a second best option compared to solving the problems in origin countries that create the push for immigration in the first place. So instead of allowing people to migrate we should try to protect their rights where they now live. Needless to say that this approach makes those would-be migrants worse off, and probably not only in the short run. Looser immigration laws have immediate benefits for the migrants, but they can also improve the rights situation in their home countries, for example through remittances and cultural exchange.

Human Rights Promotion (18): To What Extent Can We Count on the Free Market?

Why not use the free market to promote human rights? The free market – or the market for short – is the name of the institution, protected by government rules, which allows individual or collective agents such as firms to freely exchange goods and services. Agents exchange things in the market for self-interested reasons and they tend to use money as the medium of exchange, but that doesn’t mean we’ll only see greed and accumulation of wealth resulting from the operation of the market. I’ll show that we can, to some extent, count on the market to further the cause of human rights.

But let’s start by complicating things a bit:

• The market can either benefit or harm human rights.
• And human rights can either benefit or harm the operations of the market.

Hence, the relationship between market and rights is difficult, to say the least. Here are a few examples:

Some human rights are a direct benefit to the market. Take for example the right to private property. This is a human right and it’s one that is generally conceived to be essential for the efficient operation of a market (some even argue that this right justifies free markets, but I want to sidestep issues of justification here and focus on consequences). You can construct a similar argument in the case of other rights such as the right to free movement, to assembly etc. At other times, however, human rights can hinder the market: privacy is a human right but privacy can cause asymmetrical information which in turn causes market dysfunctions.

Markets can have a similar two-sided effect on human rights. Conventional wisdom says that the market is the institution that delivers the highest possible level of prosperity, compared to other ways of organizing the economy. Higher prosperity may benefit certain specific human rights such as the right not to suffer poverty, the right to work etc. This benefit may occur because additional wealth “trickles down” or because additional wealth means additional redistribution. In general, it’s the case that rights cost money, so increased prosperity should, all else being equal, lead to increased rights protection across the board.

A more indirect way in which the market benefits rights is through it’s focus on individualism: the market – as opposed to a centrally planned economy – allows individuals to choose when and what to trade. Individual freedom is also at the heart of human rights. Some have also argued that the rational self-interest that is typical of people engaging in market transactions counters some dangerous and often violent passions such as xenophobia, nationalism and racism. If people trade with one another, they may become more tolerant of one another, if only because trade requires contact, respect, trust and peace. Tolerance and peace are of course also beneficial to human rights. And, finally, both the market and human rights requires the rule of law. If markets foster the rule of law, then that will benefit rights as well.

However, other aspects of markets can harm human rights. A strict interpretation of property rights – something we often hear from defenders of the market – may make redistribution difficult if not impossible, and some rights depend sometimes on redistribution. Think again of the right not to suffer poverty. More generally, markets can have two types of effects that may harm human rights indirectly:

• Markets tend to “colonize” areas of life where an exchange of things for money is perhaps not the best way to proceed. Some goods can only be valued when they are shared rather than exchanged (e.g. art). In other cases, exchanging goods can destroy their value (e.g. political votes), just as pricing goods can destroy their value (e.g. gifts). I can also mention some types of commodification of the body such as prostitution or organ trade. While commodification of the body is not necessarily a rights violation in itself, it does devalue the dignity of human life. People are treated as means rather than ends, and a devaluation of human beings makes human rights violations more likely.
• In some sense, this instrumentalization of the other is inherent in all market transactions, not just those in which bodies or body parts are traded. Market transactions are by definition self-interested and impersonal. We only buy or sell when that makes us better off and we don’t need to get to know our buyers or sellers. We use them simply to satisfy our needs. While self-interest and lack of personal relationships in one area of life do not necessarily harm relationships, communities, caring and common deliberation on the public interest in other areas, they can do so when markets “colonize” those other areas.

And, finally, there’s the risk of exploitation in market transactions, which I have discussed here.

I’m more interested in the effects of the market on human rights than in the effects of human rights on the market. Human rights are the ultimate good, and markets are generally a means (at best, markets are one form of exercise of certain human rights). Since the effects of the market on rights can go either way, the question becomes one of limits. If the market harms human rights, or if it expands into areas where market-transactions can indirectly harm human rights, then we have good reasons to limit the operations of the market. However, when doing so we must take care not to go too far and undo the positive effects of markets.

These limitations don’t always have to be of a legal nature. A good public education system can create a culture that helps to keep markets in their place. Governments can acquire art collections and thus remove them from the market. Or they can promote organ donation in various ways (e.g. reciprocity and presumed consent) so that organ shortages don’t force people into markets (legal or illegal markets). Welfare can help poor people avoid exploitative market transactions. And so on. However, legislation is often unavoidable if we want to protect rights against the market.

More posts in this series are here.

What is Surplus-Value?

It’s a concept from Marxist theory that may still have some relevance today. According to Marxism, a worker creates more value in a day than he gets paid. This extra or surplus-value is taken by the capitalist. Or, in other words: “the wages of the laborer had a smaller exchange-value than the exchange value of the object he produced” (D. McLellan, “Marx”). The object is sold by the capitalist, who buys labor and pockets the difference. “[T]he workers would produce values that exceeded the reimbursement of their labor” (ibidem).

The capitalist forces the worker to work more than the hours necessary to embody in his product the value of his labor power. For example, if the value of labor power, i.e. the wage, is $50 a day, and a worker produces a good (or goods) which is worth $100 during a full day of work, then the second half of the day would yield surplus-value, in this case another $50.

This is theft, according to Marx, because the capitalist takes something which he hasn’t produced or bought. He takes the unpaid labor and products of someone else and lives on the back of someone else, simply because he has the privilege of owning the means of production. The workers have to accept this because they depend on the capitalist. They have to sell their labor power in order to survive because they do not own means of production and hence cannot produce without the consent of the capitalists. As the workers’ energy is not depleted after their own reproduction is guaranteed – through the payment of a wage – capitalists can use it to produce more.

Moreover, the capitalist continuously tries to maximize his surplus-value. He uses technology and science to increase productivity and diminish the necessary labor time per unit of production. Machines allow him to produce more with less labor. If wages stay constant and productivity goes up, then surplus-value goes up.

But wages, says Marx, do not stay constant. The capitalist also tries to make labor as cheap as possible and the working day as long as possible, at least within the boundaries set by labor law. 

If labor law does not permit extensions of the working day and wage reductions, then the capitalist uses the so-called “industrial reserve army“. This is a relatively large group, constantly available but not necessarily made up of the same people. They are unemployed, desperate to work (especially when the social safety net is absent or insufficient), ready to replace the employed and ready to accept a lower wage and a longer working day. This reserve army is a millstone around the neck of the workers, a regulator keeping wages at a low level.

Why do capitalists try to maximize surplus-value? In order to survive the competition with other capitalists.

[T]he wage-worker has permission to work for his own subsistence, that is, to live, only in so far as he works for a certain time gratis for the capitalist (and hence also for the latter’s co-consumers of surplus-value); … the whole capitalist system of production turns on the increase of this gratis labor by extending the working day or by developing the productivity, that is, increasing the intensity of labor power, etc. (K. Marx, “Critique of the Gotha Program”)

The capitalist accumulates surplus-value and wealth, and the worker accumulates misery, Marx predicts. “[P]overty and destitution develop among the workers, and wealth and culture among the non-workers. This is the law of all history hitherto” (ibidem). The “immiserization” (“Verelendung”) of the proletariat is something relative:

Marx was usually wary of claiming that the proletariat would become immiserized in any absolute sense. Such an idea would not have harmonized well with his view of all human needs as mediated through society. What he did claim was that the gap in resources between those who owned the means of production and those who did not would widen. (D. McLellan, “Marx”)

Everywhere the great mass of the working classes were sinking down to a lower depth, at the same rate at least, that those above them were rising in the social scale. In all countries of Europe it has now become a truth demonstrable to every unprejudiced mind, and only denied by those, whose interest it is to hedge other people in a fool’s paradise, that no improvement of machinery, no appliance of science to production, no contrivances of communication, no new colonies, no emigration, no opening of markets, no free trade, nor all these things put together, will do away with the miseries of the industrious masses; but that, on the present false base, every fresh development of the productive powers of labor must tend to deepen social contrasts and point social antagonisms. (K. Marx, “Inaugural Address of the Working Men’s International Association”)

The maximization of surplus-value deepens social divisions, brings despair to the workers, and hence will contribute to the collapse of capitalism, at least that’s how Marx saw it.

What use is the concept of surplus-value for us today? Wage aren’t going down, although they are stagnating; and social divisions caused by competition and the maximization of surplus value haven’t brought down capitalism. However, inequality has increased, in part because of wage stagnation, deunionization, and tax policy favoring the “productive” and local companies facing international competition. Competitiveness and productivity have become a fetish in policy circles. Labor laws, as a result, have been somewhat eroded. Blaming all this on surplus-value maximization driven by competitiveness is surely simplistic, but not completely wrong.

The Ethics of Human Rights (68): The Case Against the Sale of Human Organs

Or, better, a case against it. I believe that trade in human organs is morally wrong, at least if this trade is free and unregulated (but perhaps also when it’s regulated in some way). I don’t think the same case can be made against the sale of body products such as blood, hair etc., although some of the arguments against the sale of organs may also apply to the sale in body products. I will bracket this problem for now and concentrate on organs.

I make the argument against organ sales knowing full well that there’s a huge problem of organ shortages and that some people will benefit from free organ trade, and may even lose their lives if free trade is not allowed. Hence, if I claim that free organ trade is morally wrong, then I’m not necessarily making the claim that it should be forbidden in all circumstances. If there are other wrongs, such as people avoidably losing their lives, that overwhelm the wrongs resulting from organ trade, then the former wrongs may be preferable all things considered. However, I believe that the latter wrongs are commonly underestimated by those defending the legality of organ sales. I also believe that there’s a blind spot common among those who claim that the wrongs resulting from a ban on sales typically outweigh the wrongs resulting from a free organ market: it’s not as if the only choice is the one between the status quo – which is in most cases a ban on sales resulting in organ shortages – and a free organ market. There are other and perhaps better solutions to the shortage problem, even in the short term.

Here are some of the reasons why I believe a free organ markets causes serious wrongs:

1. Coercion by poverty

Not a single wealthy person will ever need or want to sell his or her organs. In a system of free organ trade, it’s the poor who will sell their organs to the rich. Maybe a legalized market will reduce the wealth disparity between buyers and sellers to some extent, given the fact that the number of potential sellers will be higher in a free market and that the number of potential buyers will not. This increase in supply compared to demand, following legalization, will reduce prices somewhat, making it feasible for more people to buy organs. Still, it will almost always be the relatively rich buying from the relatively poor, especially if the market is a global one (and I find it hard to understand arguments in favor of a free market limited to national borders).

Many of these poor will be desperately poor, particularly if the market is globally free. A decision to sell an organ isn’t made lightly, and requires some level of financial desperation. The extraction of an organ still carries a substantial risk (e.g. 1 in 3000 die from a kidney extraction even in the best medical circumstances), and few will be willing to take this risk from a baseline situation of wellbeing or happiness that is moderately high and that can not or need not be substantially improved by financial means.

Hence, if organ trade is allowed, many sellers will be desperately poor people, and there will be more of those in a legalized market than in a black market. Now it’s clear that desperation can be coercive: it forces people to do things that they would not otherwise do, that entail risks that they would avoid at higher levels of wellbeing, that may be harmful for them, and that go against their better judgment. If coercion is wrong, then free organ trade is wrong because free organ trade multiplies the number of desperately poor people that feel coerced to sell their organs.

2. Trade instead of justice

It’s reasonable to assume that rich people are responsible for the poverty that exists in the world, if not directly through their actions (trade policy, colonization etc.) then through their failure to prevent or remedy poverty. It will almost invariably be the same rich people who will want to buy organs from poor people. Now, if you first create poverty (or fail to do something about it, which in my mind is equivalent) and then tell poor people that you’ll give them money but only if they give you their organs in return, then you add insult to injury: you have a moral duty to give them your money unconditionally. Insisting on the possibility of trade while neglecting the necessity of justice is wrong.

3. Objectification and instrumentalization

There are some other good reasons why it’s wrong to buy an organ from someone, even if this person willingly agrees to the sale on the basis of informed consent, and even if he or she isn’t coerced into the sale by his or her poverty and isn’t someone who has a moral and unconditional right to the money he or she would get from a sale. For instance, buying an organ from someone means treating this person as an object and a means. It’s a failure to respect the person’s dignity as a being that should be treated as an end in itself rather than as a shop or an organ factory. It’s not outrageous to view organ trade as a new form of cannibalism.

4. Unjust distribution

The previous 3 arguments against organ trade focused on the wrongs it imposes on the sellers. But even the buyers are treated unjustly in a system of free organ sales. If the distribution of organs is regulated solely by way of free trade, then the patients who are most in need of an organ are not the ones who will get the organs. It will instead be those patients able to pay most who will get them.

5. Crowding out altruism

There’s even an argument that points to possible harm to society as a whole. If more and more human relationships are brought within the cash nexus, then giving and altruism will be crowded out. It’s obviously the case that when people can get money for something, they will stop giving it for free. Human nature is what it is. But given what it is, we shouldn’t encourage its darker sides. It’s reasonable to assume that free donation of organs will all but disappear when people can get cash for them. And it’s also reasonable to assume that this reduction in altruism can have a ripple effect throughout society and in many other fields of life, especially when we take account of the fact that more and more activities have already been brought within the cash nexus: sex, reproduction, politics …

No one assumes that everything should be tradable. Even the most outspoken proponents of organ trade draw the line somewhere: they won’t allow people to sell parts of their brains, I guess, or their children and wives, or the parts of aborted fetuses (perhaps fetuses specially conceived and harvested for their parts). So we have to stop somewhere and disallow the trade of some things. Why should it be evident that organs are not one step too far?

Alternatives

If organ sales do have harmful consequences, then what are the alternatives? If we don’t want to allow those willing to sell to go about and legally sell their organs to those capable of buying them, then how do we solve the shortage problem and save the lives of those in need of organs? We can do several things:

• We can try to increase the number of free cadaveric donations, by improving the way we approach bereaved relatives, by introducing a system of presumed consent, by promoting explicit consent (for example through the introduction of regulations that allay fears that doctors will stop life support when they need organs, or through some sort of priority system in which those who have pledged cadaveric donation can jump the queue when they themselves need organs) etc.
• We can try to increase living donation, by way of awareness campaigns.
• We can hope for scientific breakthroughs that make cadaveric recovery of organs easier or live donations less risky, or that make it possible to grow organ in vitro.

Organ sale is certainly not the only solution to the shortage problem.

A final remark: given the fact that proponents of organ trade often rely on the right to self-ownership – the right to do with your body as you please – we may have to tone down the importance of that right. Which is something we’ll have to do anyway: for instance, there’s no welfare state if the right to self-ownership is absolute.

The Compatibility of Freedom and Equality (14): Equal Relationships as Prerequisites for Freedom

One way to solve the traditional conflict between freedom and equality is offered by Elizabeth Anderson. If you want to live a free life, you have to stand in relations of equality with others. Oppressive or exploitative relationships are both unequal and unfree. Historically, unequal relationships such as “natural” hierarchies between social groups (sexes, races, classes etc.) and exploitative economic structures (slavery, early capitalism, colonialism etc.) have often if not always caused a lack of freedom among those on the wrong side of the unequal relationships.

The inequality inherent in those relationships implies the right of the superior to inflict violence on the inferior, to segregate them, to force them to obey, to exclude them from politics and public life, or to conquer and colonize them. These rights claimed by the superior over the inferior result in diminished freedom for the inferior. If you’re subjected to violence, force, segregation, conquest or exclusion then you’re unfree in any sense of the word: you can’t do what you want, your choices and opportunities are restricted, you lack autonomy and the power to govern yourself etc. Conversely, if you are equal then by definition you’re not subjected to those harms and you are free. Hence, if we want to be free we need to be equals.

This argument also sheds some light on the longstanding controversy about the nature of equality. “Equality of what?” is an important battleground in philosophy (see here and here for instance) but the terms of the argument are usually restricted to resources, opportunities, welfare, preference satisfaction, capabilities, rights etc. Equality of social position and equality as the absence of domination or exploitation are often sidelined by less relational forms of equality. Anderson is right to be unhappy with the focus on equality of resources, capabilities or preference satisfaction. People can have equal resources, equal capabilities and equal preference satisfaction and still live under the domination of groups that consider themselves superior.

Perhaps the capabilities approach can handle this problem, assuming that one of the required capabilities is the capability to escape domination. Maybe the same is true for preference based theories assuming that a preference for non-domination counts just as much as or more than other preferences. Still, let’s not forget that preferences can be adaptive, that people can enjoy a wide range of capabilities in very authoritarian systems, that people’s expectations of capabilities are socially framed by the most powerful voices in society, and that non-relational notions of equality in general can cement relationships of superiority and inferiority by giving too much attention to people’s lack of resources, capabilities and preference satisfaction. Anderson has famously argued that non-relational notions of equality make

the basis for citizens’ claims on one another the fact that some are inferior to others in the worth of their lives, talents, and personal qualities. Thus, its principles express contemptuous pity for those the state stamps as sadly inferior and uphold envy as a basis for distributing goods from the lucky to the unfortunate. Such principles stigmatize the unfortunate. (source)

The difference between notions of equality focused on resources, capabilities and preferences on the one hand, and more relational notions on the other can’t be found in their different approach to freedom; both notions of equality are concerned about freedom. Those who argue that equality is primarily a matter of resources, capabilities and preferences do so because they believe – correctly – that people need resources, capabilities and preference satisfaction for their freedom. And those, like Anderson but also Philip Pettit, who argue that equality should be viewed through the lens of relationships, also do so because they believe that freedom depends on equal relationships.

The difference therefore between the two groups is a different assumption about the requirements of freedom. One argues that freedom requires an equal level of resources, welfare or capabilities, while the other argues that it requires equal, non-oppressive, non-exploitative and non-dominating forms of relationships. Both arguments are persuasive, but it’s the former that runs away with most of the attention. The latter is therefore a useful reminder that equal relationships count for freedom. Both arguments, however, give the lie to the contention that there’s a very deep and unsolvable conflict between freedom and equality.

More posts in this series are here.

Discrimination (12): Is Price Discrimination Immoral?

Price discrimination – or price differentiation – is a commercial policy. A seller may want to sell identical goods at different prices to different classes of customers in order to increase market shares, reach otherwise unreachable groups of customers or profit from customers’ willingness to pay.

The question is whether we should treat this type of discrimination like we treat other types. In other words, should we label price discrimination as something that is morally reprehensible, and should we also make it illegal (which are two different things – lying is often reprehensible but only rarely illegal)?

The answer is: it depends. Some forms of price discrimination are morally neutral or even praiseworthy. Offering students or poor people discounts for museum tickets or public transport has some moral benefits. Other forms, however, are clearly reprehensible:

[O]ne field experiment examined discrimination against disabled people in the context of car repairs, finding that disabled customers received higher quotes than the non-disabled customers. To get at the nature of this discrimination, the authors first conducted a survey, which revealed that “mechanics believe the disabled approach 1.85 body shops for price quotes while the non-disabled approach 2.85.”  In a second field experiment, the authors instructed participants to say the phrase, “I’m getting a few price quotes.”  This significantly changed outcomes — disabled participants received much lower offers: “Importantly, the lower offers received by disabled testers after signaling a willingness to search are not statistically different from those received by the abled,” write the authors. (source)

This is an example of so-called third degree price discrimination, which is in fact a form of statistical discrimination because the price is differentiated on the basis of an attribute of a customer segment (in this case disability), and this attribute is taken as a proxy of the customers’ ability or willingness to pay (in this case, the disabled are willing – or believed to be willing – to pay more because they can’t or won’t be troubled with shopping around).

Clearly, not all third degree price discrimination or statistical discrimination is wrong (student or senior discounts are cases of third degree price discrimination), but in this example it is wrong. Offering the disabled higher prices simply because they are disabled and hence less likely to shop around, is clearly immoral, even if it’s not based on animus against the disabled. It aggravates the disadvantage that nature has imposed on the disabled, and it’s a typical case of exploitation.

Exploitation occurs when one party in a voluntary exchange between two (or more) partners gets an unfair price for the goods or services exchanged, and when this party enters the exchange from a disadvantaged position. A price is unfair when it is below what it would have been in a fair auction. It is beyond doubt that a fair auction would have allowed the disabled, who enter the exchange from a disadvantaged position, to pay less.

More posts in this series are here.

The Ethics of Human Rights (56): What’s Wrong With Exploitation?

There is no human right to be free from exploitation, but some rights prohibit practices that we normally call exploitative: child labor, unfair wages etc. However, what exactly is exploitation and what is it that makes it wrong? According to Hillel Steiner, exploitation occurs when one party in a voluntary exchange between two (or more) partners gets an unfair price for the goods or services exchanged. Or, in other words, exploitation is the voluntary exchange of two things of unequal value.

Now, what exactly is this unfair price that causes the values of the exchanged things to be unequal? Again according to Steiner, the party transferring the good or service gets a an unfair price when that price is below what she could have had in a fair auction. That’s a convincing argument since you can hardly claim that a fair price is the intrinsic price of something. Nothing has an intrinsic price or value. It’s also convincing because it avoids the extreme and implausible free market position that all voluntarily agreed prices are fair.

I think that this model does indeed cover part of what we usually call exploitation. The voluntary exchange of two things of unequal value is a case of exploitation, but in my view the Steiner model doesn’t really capture the essence of exploitation. But let’s first examine what’s convincing about Steiner’s position:

• It focuses on voluntary transfers. An involuntary exchange would be theft or slavery rather than exploitation. And we want to keep these concepts separate. Hence we limit exploitation to voluntary exchanges. Involuntary exchanges like theft or slavery are not exploitation. They are different from exploitation even if, like exploitation, an unfair price is involved. (Leaving a $10 dollar bill after having stolen an expensive car is still theft; paying my slave with meals and housing still makes her a slave). And they are, a fortiori, different from exploitation if the price is fair. (Paying my slave a fair wage still makes her a slave. If I employ someone against her will, I’m enslaving her, even if I pay her a wage, fair or unfair. Leaving a check for $50,000 after having stolen a car still makes it theft. But neither slavery nor theft are exploitation).
• It focuses on relationships where exchanges of goods or services occur. If we’re dealing with relationships where no such exchanges are involved, it’s counterintuitive to talk about exploitation. Take a relationship where no goods or services are exchanged, but where nevertheless some harm is done. The harm done is then better labeled as oppression, abuse, discrimination, rights violations etc., depending on what actually happens. It’s not because there is harm that there is necessarily also exploitation.
• It focuses on unfairness, specifically unfairness of the price of the goods or services exchanged. That’s coherent with the way we usually talk about exploitation, namely as a case of unfairness or injustice.

In Steiner’s model, these are the three necessary conditions that have to be jointly fulfilled in order to have a case of exploitation. And indeed, the model covers many cases which we normally call exploitative, such as unfair wages, some commodity markets where poor farmers sell their goods at very low prices compared to what they fetch later in the supply chain, child labor etc. However, there’s something missing from the model. It doesn’t describe exploitation in a sufficiently precise way. I’ll argue that there’s a fourth necessary condition missing.

What if someone gets a price that’s merely 20% below the fair price? We wouldn’t necessarily call that exploitation. What about a billionaire not getting a fair price for one of his goods? We don’t call that exploitation either (yet Steiner does; he has to, given his limited model). What about someone not very interested in getting a fair price? Is she exploited?

These questions suggest that the following condition is missing: exploitation only occurs when the party in the exchange that doesn’t get a fair price is already, before the exchange takes place, in a disadvantaged position. Take the example of a family selling its house for an unfair price. Maybe the price is just a tiny bit below the fair price. Maybe the family is very wealthy (the house being just one of many in their possession). Or maybe the family doesn’t care about a fair price (and has decided to go and live in the African jungle and doesn’t need the money). In none of these cases is the sale exploitative.

But maybe the motive for the sale of the house is debt coverage. The urgent need to repay some debts has convinced the family that the best thing to do is to sell the house, even if the price they can get under the circumstances is less than fair. The three elements of Steiner’s model are still present: it’s a voluntary exchange for an unfair price. It’s voluntary since no one is forcing the family to sell and there are some other options left (e.g. sending the kids to public school). Still, the family has decided that selling at an unfair price is better than doing nothing or than any of the other available options. But the exchange is only exploitative if the family comes into the exchange from a disadvantaged position and if someone else takes advantage of – or exploits – their disadvantaged position. And it’s because of this disadvantage that they can’t manage to get a fair price: their disadvantage convinces buyers that they can make a “good deal” since the sellers are in no position to insist on a fair price.

The exploitative sale does make the family better off, and it’s likely that exploitation always makes both parties better off. That could be a fifth necessary condition. Indeed, it’s difficult to conceptualize exploitation where one party is worse off after the exchange; such cases are more likely to be similar to theft, slavery, abuse, oppression etc. and therefore different from exploitation.

A similar example is the case of workers in poor countries accepting to sell their goods or labor power at very low prices (for example to a multinational company). These prices are unfair because the people happen to live in a poor country, which means that they are not able to sell their goods or labor power in a fair auction with different companies bidding. It’s an exchange, and a voluntary one. However, it’s only exploitation because the sellers are in a disadvantaged position, similar to the people selling their house at an unfair price in order to cover their debts, and because this position makes the price unfair and makes the fair auction impossible.

Let’s take a third example that features regularly in writings about exploitation: there’s a sudden blizzard and people scramble to the only hardware shop in town to buy shovels. The owner of the shop reacts in a typical way and decides to charge three times the normal price for the shovels. Is he exploiting his fellow townspeople? No. The price is not even unfair because in an auction, that’s probably the price that people would accept to pay. And in reality as well they do probably accept to pay it. If you want to call this exploitation, all supply and demand pricing is exploitation.

Once you accept all this, you will agree that some of the common definitions of exploitation are incomplete at best and misleading at worst. Exploitation can’t simply be the unfair use of others for your own benefit. That would cover slavery, theft and other relationships that are morally wrong but not exploitative. And exploitation can’t simply mean taking unfair advantage of someone, because we don’t want to call taking advantage of a millionaire a case of exploitation.

Are there some types of voluntary exchange that are inherently exploitative, whatever the price, fair or unfair? For example organ sales, or sex work? No, such transactions are exploitative only when the price is unfair and when the further condition of disadvantaged starting positions is also met (people who decide to sell their organs or their sexual services will often be in disadvantaged starting positions, but the price is often not unfair). Of course, it’s not because these exchanges are not exploitative that they can’t be immoral for other reasons (e.g instrumentalization).

This account of exploitation is different from the well-known Marxist account. According to Marxism, workers are exploited because they are forced into employment status (given that they themselves don’t have any means of production and that the capitalists have monopolized those means). Hence, the Marxist notion of exploitation collapses into the notion of slavery, something which I want to avoid.

More on exploitation is here and here.

Human Rights Promotion (3): When Human Rights Leave a Bad Taste in Your Mouth

Take for instance capital punishment. Human rights defenders normally reject it. And indeed, if you use your head and look at the data, and if you refine your moral compass, you can’t possibly reach any other conclusion. And yet, most of us, even the most ardent rights defenders, know cases in which they would like to see people die – perhaps even administer the lethal drug themselves. Emotions are hard to reason with. We swallow the logic of human rights, the data and the moral precepts, and yet in doing so they leave a bad taste in our mouths.

There are other cases. Take child labor. We know that it’s detrimental to a child’s education and hence her future prosperity, intellectual development and flourishing. It’s probably also harmful to her health. And yet, we accept it in certain cases because the alternative is even worse. In some place, there may be no education provision worthy of the name, and forcing a child away from work may aggravate the poverty of her family without doing much for the child’s education. Acquiescing in a child’s rights violations is better for her rights than doing nothing.

The same is true with sweatshop labor or the exploitation of poor migrants:

In Lant Pritchett’s view, countries like the UAE, Saudi Arabia and Kuwait – which employ armies of guest workers, house them in labour camps, forbid them from organising unions, often deny them equal protection under the law and pay them the wages of an underclass – are actually doing more to redress the inequities of the world than western nations that maintain high labour standards but keep migrants out. (source)

In all these cases we’re faced with awful situations, but the alternatives are even worse; or, better, the realistic alternatives. If we could eliminate poverty overnight, open our borders, provide decent education and labor standards to all, and inject a conscience in all employers, we wouldn’t need to swallow dirt and leave a bad taste. But we can’t, not now at least.

Another example is the veil. We should allow Muslim women to dress modestly because we want to respect freedom of religion and because we don’t want to treat those women as lesser human beings who don’t have the agency to stand up against patriarchy and who need to be liberated by us enlightened folk. And yet, at the same time we know that we may be endorsing and promoting a symbol of oppression and thereby oppression itself. We also know that there are women who are forced to hide themselves, but we don’t know which. And finally, we know that dressing modestly renders some activities difficult, and that women as a result may not be able to fully develop themselves. And yet we swallow, because the alternative – forcing all veiled women to uncover – would be worse.

The Ethics of Human Rights (11): Organ Trade

The shortage of organs for transplantation is a universal problem. The supply of organs is way below the demand. And demand is increasing due to progress in medical science and increasing average age. The demand comes mainly from developed countries. The reason is that life expectancy is higher in these countries, and therefore also the demand for organs. Also, the health care system is more developed and hence more likely to engage in transplants.

There are two ways to harvest organs: deceased organ donation, and live organ donation.

Deceased organ donation

In some countries, deceased organ donation is hampered by social, cultural, religious, legal and other factors. In some cases, donors have to state their intent while living. They have to opt in. In other cases, they have to opt out and hence they are donors by default, which tends to produce higher rates of donation.
In other cases still, family members of the deceased have to consent, which brings down rates.

Live organ donation

The use of live donors for non-vital organs such as kidneys and parts of liver, for example, is also practiced, but the purchase and sale of transplant organs from live donors are prohibited in many countries.

Transplant tourism and international organ trade

The shortage of a local supply of organs – due to some of the reasons given above, or a combination – has led to the development of transplant tourism and international organ trade. Poor people in developing countries are often forced to donate a non-vital organ; forced by poverty or forced by outright violence. People are kidnapped and operated under duress, and often don’t even get paid. Sometimes they simply get killed because this bypasses the requirement of consent. Corpses are also harvested, not rarely without the consent of the deceased or his or her relatives. The legality of live organ donations in some countries encourages poor people to sell some of their non-vital organs such as kidneys. However, the circumstances in which they are operated can turn a non-vital organ donation into a fatal one.

Rich people travel to countries where these different kinds of harvesting are possible, legally or illegally, and where hospitals are willing to cooperate in such a scheme and are relatively capable so as not to scare away patients. China is a well-known destination because there’s the enormous supply of thousands of people executed every year.

Although those who can afford to buy organs are obviously exploiting those who are desperate enough to sell their organs, the recipients may also suffer from the trade. They may receive substandard or even sick organs.

Some contend that the poor should be allowed to sell their organs, because we merely contribute to their poverty. Exploitation may be morally preferable to death, but given the risk of forced donation and of complications during surgery, this is a slippery slope.

Someone has aptly called the whole business New Cannibalism.

Other issues

One can also see a trend to declare a person dead at an earlier stage than in the past, for example some seconds after cessation of brain activity or heart activity, rather than minutes. Some organs become useless after a certain waiting period. This means shifting the definition of life and death, and perhaps less reanimation enthusiasm. Another, and opposite form of abuse is keeping brain-dead people artificially “alive” as an “organ warehouse” for future donations.

Also, the use of cloning and designer babies for the purpose of organ production is controversial, as is the use of animal organs.

The Ethics of Human Rights (8): Mutually Advantageous Exploitation

exploitation: utilization of another person or group for selfish purposes. American Heritage Dictionary

To exploit someone means to take unfair advantage of that person. Usually, we define “unfair advantage” as somehow resulting in harm or coercion for the person who is taken advantage of. If A takes unfair advantage of B, we assume that B is harmed in some way, is forced to deliver the advantage, or is otherwise involuntary involved.

For example: A rapes B. The advantage gained by A is sex. This advantage is gained unfairly by A because the rape harms and coerces B. Otherwise it would not be rape. Rape is therefore charaterized as sexual exploitation.

However, it is possible to speak about exploitation and the taking of unfair advantage by A if A takes an action that benefits B. We can call this mutually advantageous exploitation, or mutually beneficial exploitation. A benefits, obviously, but B as well. B gains an advantage and is better off had the action not taken place, yet still is exploited.

Here’s an example to make this counter-intuitive statement more acceptable. Take the case where A and B have unequal bargaining power. A sells bread in an isolated village where the people don’t have the means to produce their own bread. A overcharges for the bread because B and friends don’t have the strength to find another seller or to wait. The sale of bread makes B etc. better off, because without bread they would be worse off. Yet A takes unfair advantage of the buyers’ condition. A exploits but doesn’t cause harm. However, A does coerce B. The transaction isn’t completely voluntary. B doesn’t have a choice.

It seems that the old maxim, volenti non fit iniuria – no injustice can be done to the willing – is still valid. Injustice implies coercion. But the other maxim, that injustice implies harm, can sometimes be wrong, unless the simple act of coercion by itself means harm.

A similar and politically more salient example would be if A were a transnational company offering to buy cacao from local cacao producers (B).