What is a fair wage?! Ruthless Criticism

Translated from a text by Freerk Huisken

What is a fair wage?!

“... I had a very bad discussion with a trade unionist about wage justice. I actually wanted to explain to him that there is no such thing as ‘fair wages.’ When I pointed out that there are so many different wages for work activities that always require the whole man or whole woman, he then said that the different achievements would be paid fairly with different wages. I didn’t really know what to say then...”

The first thing I would have asked him is how achievement is measured in amounts of money. It is true that wages are generally – even in economics – considered to be the price of work. But how is the price of work determined? For example, by the quantity of achievement included in the work? And how is this quantity to be measured? How do employers know whether, say, one hour of a specific work achievement is worth €10, €20, €50 or €100 in wages? There’s no shortage of suggestions for calculating the price of work. But they explain nothing:

On the one hand, one could estimate the length of time that the work is carried out. Clearly, if you work 10 hours at an hourly wage of 18€, you earn more than if you only work 6 hours at the same hourly wage. And it may also be considered fair when the wage for 10 hours work is four hours pay above that for 6 hours work. However, this presupposes what first must be explained: How is the hourly wage of 18€, which is the basis for the calculation, determined? And what sorts the different hourly wages into an entire wage hierarchy?

On the other hand, the work products are referred to: If the wage is the price of labor, that is, if all labor is considered to be paid, then – according to the explanation – the wage is measured by the price of the sold commodities, the products of work. However, this (milkmaid’s) bill would be a complete fail for the entrepreneurs. Because if they were to pay the value of the sold commodities as wages to their employees, they wouldn’t have a profit. And even if one deducts the costs for means of production, raw materials, etc., from the price of the sold goods, the result would be the same. Apart from the wages paid out, only the costs for the material elements of production would be recovered. But what the entrepreneur under capitalism lacks is a surplus over the advanced costs. With such wages, the capitalists would have given the working class a fine life – but at the price of their existential task. The real existing wage relations in real existing capitalism can’t be unraveled in this way.

In any case, one thing is certain: the wages paid are not based on the amount of work done. All statements made in this regard are useless. There is simply no objective relationship between wages paid and work done that can be determined or even calculated in any way. How could there be? One quantity is the quantity of money – in the units of a particular currency. The other quantity is the performance of work in time – the expenditure of working capital, of “human brain, muscle, nerve, hands, etc.” in various proportions. These two quantities have nothing in common that would allow them to be put into a relationship – even one to be determined quantitatively.

So you would have to approach the issue of wage justice differently. For example, you could confront the trade unionist with the question: what is his actual view of the collectively bargained wage? The collectively bargained wage is the result of a bargaining struggle in which two sides debate year after year about the wage level; this would hardly be necessary if there were such a thing as an objectively determined wage-performance ratio. The reason that wage determination takes this form is that the entrepreneurs and the workers have mutually exclusive interests in the wage: it is certainly no secret that wage workers want to earn as high a wage as possible for their work, but that, conversely, entrepreneurs want to pay as little as possible for the work they have done. The respective wage level is decided by nothing other than a power struggle between these oppositionally positioned interest groups’ organizations. As a result, the collectively bargained wage is in each case how this power struggle is fought out, i.e. with which concerns the two class organizations bring to this power struggle and which weapons they use in it. This, and not anything else, is responsible for the wage received by the worker. And once the wage has been negotiated, the entrepreneur secures for himself command over the work. The fact that he makes optimum use of it in accordance with his interests can be seen from the wage disputes that take place every year: he regularly gives the union reasons to re-enter the wage dispute by intensifying the work, rationalization, wage losses squeezed with threats of layoffs but also sometimes by ignoring collective bargain rules, etc. The employers take full advantage of the fact it is they who own the means to allow others to work for themselves, and these people must work for the employers as their means for making profits because they do not have their own sources of money.

So much for the refutation of the idea of fair wages.

At the same time, all this explains why the average wage is such that the life of the wage-earning class is determined by a wage that makes it necessary to endure poverty not just in the event of unemployment, illness or retirement. At the same time, this says a great deal about how this power struggle is played out and who benefits from it. If in wage disputes today the trade unions justify their wage demands to the employers with the calculation that the work has again become more productive, the profits have again risen higher, the last wage demands have only resulted in real wage losses due to inflation, and a little higher wages would strengthen the purchasing power which ultimately benefits the employers again, etc. – if trade unions in this way explicitly recognize the profit interest that is opposing their clients, then they take back the antagonism in the wage dispute which they opened up in the dispute over wages.

All in all: the wage workers’ interest in a wage that lets them sensibly organize their lives and the lives of their families into old age does not appear in today's wage struggles. It also plays no role in the demand for a fair wage, which the trade unions are constantly demanding against all the refutations they have come to know, taking its standard of measurement – as criticized above – in achievement or performance for capital which should be rewarded adequately. What the wage has to do for its recipients is entirely up to their efforts: They have to make do with the paid wage sum, whether they can get by on it or not. That wage labor is not a suitable livelihood for them, but that they have no other choice in capitalism, they learn in their own bodies. If they nevertheless hand over the question of wages to the trade union, then – one could easily say cynically – they get the wages they deserve quite fairly.


At the same time, it has become clear what the silly wage theory of the price of labor is good for: if all work is considered paid, then the exchange between money and work seems so fair that it couldn't be any fairer. And working humanity is allowed, first of all, to imagine that their work achievement gives them the means to earn fair money and, second, with this moral stance on wages, allows them to adopt it as the reason they actually shuffle off to the factory or office every day: for the sake of justice or for the sake of a livelihood. Wage earners may instead imagine that something like an exchange of equivalents is taking place between them, the “employers” and the “employees.” A nice give and take! In the payment of wages, no sum of money at all is exchanged for a performance of labor; the equivalent exchange is pure appearance. The wage pays for all the benefits that the labor has for capital! The money relation contained in the expression “fair price of labor” conceals the fact that a wage worker only receives wages at all to the extent that he produces a surplus for the company. If he doesn’t, he won’t have any income at all. So, before the dispute between trade unions, work councils and entrepreneurs about fair pay for work even begins, the entrepreneur has long since had a good laugh: his interest in profit has already been taken into account with every worker hired.