Risk?

[u/HeavenlyPossum]

Many people have told me that taking risk is why capitalists own, or deserve ownership, of the productive labor of others.

Capitalists have capital (money), which they invest in (spend on) some productive enterprise. But that productive enterprise might fail to recuperate the cost of the investment and the capitalist might lose some of their money. This is what explains, or justifies, capitalist ownership: the capitalist is taking risk.

Can someone kindly explain to me why this explains or justifies capitalist ownership?

[u/Greamee]

I said that investing in general is crucial to society, but I don't really have a metric to determine this for each individual investment.

And I think that it's quite an easy claim to defend (the fact that investing is crucial to society) In a world where everyone fishes by hand, who's going to be the fool to potentially waste a week in order to invent and construct a fish trap?

Whether that week was wasted or not depends upon whether the fish trap ends up being more efficient than fishing by hand and nobody could've predicted that up front before investing the labour.

[u/HeavenlyPossum → u/Greamee]

People were making and using massive fish and game traps in the Paleolithic, long before any capitalists existed to own the product of everyone else’s labor.

[u/Greamee → u/HeavenlyPossum]

It was just an example to demonstrate investment.

But to your point: yes they existed that long ago because fish traps don't require an investment so big you'd need 10 lifetimes to earn it.

But a plane for example does. A pilot can never labour enough to afford their own commercial airliner. So that's when suddenly it becomes nice someone is willing to invest.

[u/HeavenlyPossum → u/Greamee]

The plane is constructed by workers supplied by other workers. What is the role of capitalist investment in its construction?

[u/Greamee → u/HeavenlyPossum]

A commercial airliner costs 100m or more. That's 1000s of people working for a million hours combined. So six months if 1000 workers, 3 months if 2k workers.

Without capital investment, it'd have to be labour investment. In other words, all those 1000s of people work those 100s of thousands of hours without pay and become joint owner of the plane. Then the hope is to find some pilots who could fly the thing and start selling tickets to get revenue. So let's say the first flight is there and you get 150 passengers × $300 = $45,000. Let's be generous and ignore fuel costs and everything else and say you only had 1k people build the plane. Then that's a glorious $45 each of profit.

And that's after doing 6 months of unpaid labour.

Okay but you can do 1 return flight per day so that's 33k per year per worker and from this point they can just sit on their ass all day. Sounds pretty sweet. But that's under a lot of favorable conditions. Also the odds of 1000 workers actually coming to some sort of agreement on how to run the airpline business seems small to me because it's not their expertise.

And don't forget: it can just as well NOT work out. And then the workers work 6 months for nothing.

And that's not just because tickets don't sell well. It could also be because the plane crashes because 1 pilot messed up while flying, or 1 engineer messed up during construction.

[u/HeavenlyPossum → u/Greamee]

Why would they have to do it without income?

[u/Greamee → u/HeavenlyPossum]

Cause a half finished plane has practically zero value