There are some serious problems with Ingraham and Hohmann’s comments. The obvious one is that a giant multinational corporation yielding to the demands of American consumers is certainly “good for America” (including American workers, who tend to consume) vis‐à‐vis the days when corporations sniffed that “consumers will buy what we give ‘em.” Even in the narrow context of automaking labor, it is certainly better for workers that GM is refocusing on products with growing demand rather than products with softening demand.
But there’s a deeper problem with what Ingraham and Hohmann write: they seem to embrace a value judgment that labor is virtuous while capital is amoral (if not immoral). I believe this judgment is balderdash.
Think of those Socialist Realism paintings of a world without capitalists — a world of happy workers laboring in fields and factories, often with a smiling, wise Marxist leader looking on. Notice that the workers are always hale and healthy (if not outright buff); the fields lush and extensive, the factories roaring with industry. Yet, despite the artwork, attempts at real Marxism have yielded plenty of broken and impoverished workers.
That’s why I think capital is more virtuous than labor.
Specifically, laborers — socialist or otherwise — typically have to be healthy and strong to be productive when capital is limited. Many of us will never be that, and none of us will be healthy and strong at some points in our lives. Also, to be productive, laborers have to live and work in economically booming areas, relocating as fortunes shift, whereas many of us find ourselves in economically struggling areas and face hardships if we leave. And productive laborers have to work for firms with talented and fair managers, operating in industries that don’t experience business cycles, and have up‐to‐date job skills, or else they risk loss of employment.
In contrast, capitalists can prosper despite being infirm, economically isolated, and having limited or outdated job skills. They can overcome business cycles and bad managers. They don’t even need to be particularly savvy investors. The elderly person with an investment in mutual funds can prosper even as her physical strength fades, industry moves away, and managers make ruthless business decisions. And she can continue to prosper despite shifts in demand for different types of labor and the expansion of automation.
So while labor only benefits those with ephemeral physical talents and skills who are fortunate enough to be situated such that they can employ them, capital can benefit everyone everywhere. If there is a “crisis” in American capitalism, it’s that too many people are invested only in labor and not enough in capital.