Essays on Wealth and Poverty

Essay Number 1.

What Is Wealth?

By: Alan L. Maki

In a democratic country defining wealth should be a relatively easy task; this is not the case in the United States. It is important that we define the term wealth very precisely because what we understand wealth to be is fundamental to any discussion that takes place concerning government budgets, globalization, and whether or not we have the resources, the wealth, to:

1. Implement the United Nations’ Universal Declaration of Human Rights signed by most nations in 1948;

2. Right the wrongs of slavery; and,

3. Eliminate poverty.

None of these topics can be discussed unless we share a common definition of wealth.

The Oxford Dictionary defines wealth as having a great quantity of assets. The only thing most of us comprehend from this definition is that, personally, we are not wealthy.

Wealth has been defined in various ways. There are those who prefer not to attach a hard and fast definition to wealth. Having a definition of wealth is central to an understanding of economics. Economics- Theory and Practice, the book used by economics classes at Tidewater Community College, states that Marxian theory has provided the most persistent and powerful critique of capitalism. Defining wealth is central to Marxist thought. This ability to define wealth is what contributes towards making Marxist theory the most persistent and powerful critic of capitalism. The instructor of the economics class I am in stated, “Investors create wealth”. A student asked the instructor, “Could you provide us with a hard and fast definition of wealth?” The instructor replied, “No. Don’t try to pin me down on that.”

A good example of why we need to define wealth involves the complex and controversial subject of slavery. Slavery, the epitome of the most inhumane, savage, barbaric, and brutal method of creating wealth in the history of the United States, has left a legacy of racism, poverty, and despair. As Paul Robeson so eloquently pointed out in his speech during his Peace Arch Concert in 1952, slavery was a system that created vast and great wealth. Controversy centers on this wealth today.

Why is there no hint in the dictionary definition that it takes labor (slave labor or free labor) to create wealth? The definition of the term wealth has been sanitized in order to “free” it from its association with labor. Wealth cannot be defined in isolation from how it is primarily created--- by labor.

What is the definition of wealth? Karl Marx, writing in Volume 1 of Capital, agreed with William Petty who said of wealth, “Labor is its father and the earth its mother”. Thus, in defining wealth, we can paraphrase what Karl Marx wrote in three volumes of Capital: That which is the result of what is created by workers using tools and machines to turn raw materials into things that people want, need, and use--- is wealth. Contrary to popular belief, Wall Street “coupon clippers” and investors create no wealth. They steal the wealth created by labor.

The real controversy is not so much in the definition of wealth, as when we begin asking questions: Who has the right to own, control, and distribute the wealth created by labor? One way to redistribute the wealth would be for the United States Congress to enact federal legislation to make the minimum wage a living wage. In this class struggle over the minimum wage we see the battle lines very clearly drawn between those who create wealth and those who steal the wealth.

Works Consulted/Works Cited

Daniels, Ron. “Declaring the Slave Trade a Crime Against Humanity: The Moral and
Legal Basis for Reparations.” Black Radical Congress. June 20, 2001.

Lincoln, Craig. “Steel’s Struggles Could Transform Iron Range.” Duluth News Tribune.
Duluth, Minnesota. May 13, 2001: 1A.

Marx, Karl. Capital, Volume 1, 2, 3. International Publishers. New York 1967: 43. http://www.intpubnyc.com

Oxford Dictionary. The Oxford Color Dictionary and Thesaurus. Oxford. 1996: 580.

Robeson, Paul. “Concert At Peace Arch Park.” Speech 1952. Folk Art Records.
New York.

United Nations. “United Nations’ Universal Declaration of Human Rights.”
1948 United Nations. http://www.un.org/Overview/rights.html

United Nations. http://www.un.org

Wheeler, Tim. “Progressive Groups Meet To Map Strategy.” People’s Weekly World.
New York. March 10, 2001: 5. http://www.cpusa.org/

Welch, Patrick J. and Gerry F. Welch. Economics: Theory and Practice. Dryden Press,
1998: 13.


Essay Number 2

The Consequences of Working in Sweatshops

By: Alan L. Maki

The accumulation of wealth by corporations through capitalist globalization is having a disastrous impact on the lives of working people in the United States and across the globe. This impact is being felt in workplaces and in homes.

People toil in a rapidly proliferating network of modern day sweatshops without any job security, at low pay, and under extreme duress as “temp” and “seasonal” workers at companies like the Lillian Vernon Corporation (LVC). They are deprived of basic human rights articulated in the United Nations’ Universal Declaration of Human Rights (UNUDHR) (UN 1948).

Workers are strictly forbidden from using the “U” (union) word while employed at LVC. Democracy ends with the first footstep on the Pinkerton protected LVC property. Here, the company handbook becomes the “law of the land”. Workers who talk about organizing a union in order to achieve something more than $6.05 an hour--- like a living wage--- are summarily fired under terms of the “at will hiring contract” that has replaced the “Run Away Slave Act” in this right-to-work-for-less “Commonwealth” of Virginia.

Lillian Vernon, “Miss Lilly” as her employees “affectionately” call her, has boasted in newspaper articles and in her autobiography of her great wealth. “Miss Lilly” explains her wealth as being the result of having an “eye for a deal”. In reality, she has an “eye” for cheap labor, pushed to the maximum, which has been the source of her wealth and the source of misery for thousands of workers.

The labor-intensive part of LVC’s operations was moved from New York to Virginia Beach where labor is cheaper and labor laws more lax. Workers are frequently injured when using unsafe machines and equipment. Worker fatigue is due to ten-hour days, seven-day weeks that the company forces on employees. The company considers the workers expendable as supervisors continually threaten, “If you don’t like the way we do things, there are plenty of people looking for work!”

When workers are pushed beyond human limits all kinds of problems are created on the shop floor including animosity between workers resulting in threats, fights, name calling, and racial slurs. Households are disrupted as workers drag themselves out of bed to go to work and drag themselves back home. Also, fatigue causes tempers to flare at home, resulting in verbal and physical spousal and child abuse. Under these circumstances, children cannot be properly cared for in single parent households. It’s impossible to maintain a family on $6.05 an hour. (Try to imagine how a worker in India must be living when Lillian Vernon, with her “eye for a deal”, purchases beach towels for six cents per piece over there that sell for twenty dollars here?)

An elderly African-American woman, one of my co-workers at LVC, summed up the impact of working in a modern-day sweatshop when, referring to the behavior of management, she remarked, “Why don’t they just bring back the chains?”

The International Labor Organization has launched a campaign “For Fairness In the Workplace” which is supported by the Canadian Labor Congress and the AFL-CIO who have jointly called upon workers to aggressively assert their rights in the workplace and in the communities where they live. The United Steelworkers’ of America has launched an educational campaign, “Workers’ Rights Are Human Rights.”

Only a concerted, well organized, and militant working-class campaign creatively and consistently utilizing the four cornerstones of a proven method of organizing resistance and struggle to the corporate agenda will be successful in helping working people overcome the disastrous consequences of capitalist globalization.


The four cornerstones are:

1. Education
2. Organization
3. Unity
4. Action

These four cornerstones are the key to working-class empowerment. Working people will have to be careful not to fall victim to the “dead-end alley” posed by the anarchists who don’t understand what it takes for workers to win in the struggle against capital; nor do the anarchists understand that the only logical alternative to capitalist globalization is socialism--- a topic, along with the “four cornerstones” that will be explored in other essays in this continuing series.




Essay 3

Raise the Minimum Wage to a Living Wage

By: Alan L. Maki

World leaders pledged to eliminate poverty with-in the first quarter of this new century in their United Nations’ “Millennium Summit Declaration.” They reiterated their support for the 1948 United Nations’ Universal Declaration of Human Rights (UNUDHR), which states in Article 23,

“Everyone who works has the right to just and favourable remuneration ensuring for himself and his family an existence worthy of human dignity, and supplemented, if necessary, by other means of social protection.”

Article 25 (1) declares,

“Everyone has the right to a standard of living adequate for the health and well-being of himself and his family, including food, clothing, housing and medical care and necessary social services, and the right to security in the event of unemployment, sickness, disability, widowhood, old age or other lack of livelihood in circumstances beyond his control.”

These leaders did not say how they would eliminate poverty nor did they say what, if anything, they would do to make the UNUDHR a living reality for everyone. The first meaningful step towards eliminating poverty in the United States is raising the federal minimum wage to a living wage. This will provide for the redistribution of wealth to those who created it and “prime the pump” of economic activity. Which, in turn, will create new jobs--- thus alleviating the bane of unemployment.

The minimum wage should be a living wage. What is a living wage? A living wage is whatever it will take in order for every worker to attain a standard-of-living and a lifestyle commensurate with what is called for in the UNUDHR--- a combination of government social programs and the minimum wage.

One argument against raising the minimum wage that comes from “classical economists” is that the market, if left alone, will solve wage problems through its own self-correcting measures. This hasn’t happened. There are no self-correcting measures because the natural tendencies of a capitalist economy tend to push wages down, unless there is a widespread movement among workers for unionization.

Another similar argument against raising the minimum wage--- ironically, put forth by many politicians--- is that government shouldn’t be involved in regulating economic activity. This argument “holds no water” because government intervention in the economy is already frequent and routine. Government intervention has been a widely used method of correcting economic problems for over one hundred years.

Keynesian economists, who have been the dominant players in every administration since Franklin D. Roosevelt, have long used the minimum wage and unemployment as tools--- or levers--- to control (ratchet down) wages in an effort to manipulate the capitalist economy in an attempt to prevent inflation and recession in spite of the adverse and cruel effects this has on the lives of working people. The opponents of raising the minimum wage argue that keeping the minimum wage low helps to keep wages down generally, thereby keeping inflation (price increases) under control.

But, prices do not chase wages. Wage increases are needed to catch up to prices.

One very important argument that is never stated in public, but well understood by the business community, is that keeping the minimum wage low prevents those who create the wealth from having access to the wealth. One sure way for working people to gain access to this wealth would be to increase the minimum wage.

In addition to the arguments against raising the minimum wage cited above, there are several other arguments against raising the minimum wage that come directly from the business community and their political hacks. Perry Springer, the editor of the West Michigan Worker, reported this exchange between Joseph Mancey (a trade union leader from Michigan) and Congressman Gerald R. Ford in the spring of 1972:

“…Joseph Mancey challenged the big-business way of thinking when he rebutted Ford’s claim that raising the minimum wage would drive prices and the cost of doing business up. Mancey responded, “I don’t give a damn about your friends in the business community! Businessmen don’t care about the working people they employ who I represent… These bosses need us more than we need them… All businessmen care about is their bottom line. This is what I say, ‘If a job needs to be done- if society, if government, or a if business requires that job to get done- then by God the working man and working woman performing that task is entitled to a minimum wage that is a living wage…” (Bold/Italic-ALM).

As a concrete example of why the minimum wage needs to be increased let us look at Wal-Mart Stores in Virginia Beach. Wal-Mart Stores pays its employees around $6.00 per hour, slightly more than the current minimum wage. However, a worker with four mouths to feed can’t even buy one week’s groceries to feed his/her family with the weekly paycheck, let alone pay rent/mortgage, healthcare, transportation, utility bills, purchase clothing, and provide everything else that it takes to live a decent life. Imagine that, working forty hours per week at Wal-Mart Stores and not being able to buy a week’s groceries from the same store with your paycheck? Wal-Mart Stores is the largest corporate employer in the United States with almost 675,000 employees--- more than General Motors (Welch).

Unfortunately, the minimum wage has never been the equivalent of a “living wage.” To the contrary, the minimum wage has barely improved living conditions for the working class over the last forty years. A grassroots movement made up of workers and students has begun to take root in community after community across this nation for an increase in the minimum wage that would make it a “living wage.”

Students are often the victims of employers who refuse to pay a “living wage.” I would urge students in this class to join with their counterparts around the country in writing letters to elected officials, circulating petitions, and participating in demonstrations until Congress approves a federal “Living Wage-Minimum Wage Act.” A “Living Wage-Minimum Wage Act” would be the single most important step we could take towards eradicating poverty and making the United Nations’ Universal Declaration of Human Rights a living reality for all working people in the United States.


Works Consulted/Works Cited

Manitoba Federation of Labour. “Statement on the Minimum Wage”. 2001. Manitoba, Canada.
< http://www.mfl.mb.ca/minwage.html >.

Springer, Perry. “The Minimum Wage Debate.” West Michigan Worker. Spring Issue 1972.
Grand Rapids, Michigan: 2.

Thareer, Shashi. “Are Human Rights Universal.” The New Internationalist. March (2001): 34-35.

United Nations General Assembly. “United Nations’ Universal Declaration of Human Rights.”
New York. 1948. < http://www.un.org/Overview/rights.html >.

United Nations Millennium Summit. “Millennium Summit Declaration.” New York.
September 6-8, 2000. < http://www.rcgg.ufrgs.br/msd_ing.htm >

Welch, Patrick J. and Gerry F. Welch. Economics: Theory and Practice. Dryden Press.
New York. 1998: 376.