3. There is some advantages of a free labor
market benefit not only the worker but also the
economy. Since pay is usually based on
productivity and workers tend to seek higher-
paying jobs, this whole process tends to place
people where they can contribute the most to
the production of goods and serves that other
people want.
5. Most people in modern industrial societies are called
workers or labor. However, people represent not only labor
but also capital investment. Apprenticeship, with and
without pay, has been a centuries-old institution in many
parts of the world, and unpaid labor was not common in the
United States as late as the Great Depression of the 1930s,
when people desperate for work took jobs without pay for
the sake of gaining work experience that would improve
their chances of getting paying jobs later, either with the
same employer or with other employers who were hiring
only experienced worker.
7. Most people of course work for the sake of earning an
income – and while the earning of income might seem to
be something simple and easy to understand, income
statistics are full of pitfalls and fallacies. Underlying most
fallacies about income are three key confusions:
Confusing income with wealth Confusing statistical
categories with human beings Confusing the transient
position of individuals in the current income stream with
an enduring class. The distinction between income and
wealth is that income is a flow of money during a given
year, while wealth is an accumulation of money–or of
assets valued in money over a number of years.
9. One of the largest and longest lasting systems of
involuntary labor in the 20th century was that of the forced
labor camps-The Gulags-in the Soviet Union. Both
inhumanity and inefficiency were hallmarks of these camps.
Deaths averaged more than 50,000 prisoners per month,
particularly in the year 1942. During the war years as a
whole more than 2million people died in Soviet Union
camps. Shortly, after Stalin's, the head of the Soviet secret
police- hardly a humanitarian began closing down the
camps for economic reasons. Because of the sheer size and
scope of the Gulag system, it made huge contributions to
various parts of Soviet economy, but usually at far higher
cost than those on comparable enterprises in the general
economy.
10. In its heyday, forced labor in Soviet Union produced one-fourth of
all country's timber, 40% of its cobalt, 60% of its gold and 76% of its
tin. But just the purely economic cost- quite aside from staggering
human cost- were typically higher than the cost of doing the same
thing outside the Gulags. With the opening of the government's
secret archive in the last year's of Soviet Union, the extent of
inefficiencies of forced labor were more fully revealed. The building
of railroads was an example: "By 1928 the length of railroads on
which construction had started but had been suspended was
approaching 5,000km( not counting railroads that have been
completed but were unused or partly used because they were
unneeded). Meanwhile the total increase in USSR's railroad system
in 1933 and 1939 amounted to a mere 4,500 KM. A considerable
portion of the dead railroads was built at the cost of many prisoner's
lives.
12. Slavery has inhabited continent among people of every race
for thousands of years. The very word Slave derives from the
word "Slav", not only English but also in but also in some other
European languages and in Arabic. That is because so many
slave were enslaved for centuries before the first African was
brought to the Western Hemisphere in bondage. More than a
million Europeans from various countries were enslaved and
taken to North Africa's Barbary Coast alone from 1500 and
1800. That is more than the number of African bought in
bondage to the United States and to the 13 American colonies
from which it was formed. The roles played by slaves have
covered an enormous spectrum. Some were used a a human
sacrifices by the Aztecs of central America or in Indonesia or in
part of Africa among other places.
13. As a general pattern, the more highly skilled, the more
intellectually demanding and more responsible the roles filled
by the slaves, the less they were treats with brutality and
contempt inflicted on slaves doing arduous manual labor.
Those in higher level occupations tended to be less and less
treated as slaves, while for some point at the highest level
their bondage was nominal. Urban slaves were also treated
less harshly for some reasons, and Frederick Douglas described
the typical urban slave in the Antebellum South as almost free
citizen. Where slaves population were large enough to have
serious potential for scouak disruption and danger to the lives
of free population, the need to minimize such dangers limited
the extend to which the slave population could be educated
for higher roles. From an economic standpoint, this meant that
in addition to inefficiencies in using people of a give capability,
slavery also limited the capabilities that could be developed
among people of a given potential.
15. The wasteful use of un owned involuntary labor can be
contrasted with the more careful allocation of involuntary labor
that is owned and sold, since both buyer and seller in the free
market economics have financial incentives to weigh the
productivity of the labor in the alternative use. Slaves are not only
involuntary labor that is bought and sold. The services of German
Mercenaries, such as those who were used by British in their
attempt to suppress the American Revolution, were sold and
rented collectively by heads of various German principalities of
the time who treated these soldiers as if they were property.
Much of the white population of 17th century colonial America,
more than half in colonies in South of New England, arrived as
indentured servants. Indentured labor was common in Caribbean
as well as in the American colonies and continued to be an
important source of labor from India and China to various parts of
the world, well into the 19th centuries.
16. Indentured laborers and other forms of contract
labors were usually a result of initially free choices.
Most of the elements of choice open to most
indentured workers were lacking in the markets of
slaves, where the choices were entirely in the hands
of buyers and sellers. This did not mean that the
choice made by slave traders and slave owners were
unconstrained expression or personal whims.
18. It is more costly to try to enslave people who
have the army and navy of a major nation
around them. From the demand side, there
must also be a sufficiently valued use for slaves
to cover the costs of enslavement. In ancient
times, especially, captured enemy soldiers could
be killed, sold back to their country for ransom
or sold in slave markets elsewhere.
20. In the Ottoman Empire, eunuchs were in
great demand to work in the harems of the
wealthy and, because most of the slaves who
were castrated died as a result, the price of the
survivors had to cover all the costs incurred
capturing and transporting those who did not
survive. Slave prices also varied with the
distance from the source, so that slaves in the
United States had higher prices than those in
Brazil.
22. In the West Indies, overseers had little
incentive to think beyond stage one. Special
care for pregnant women or the raising of
children was not part of their remit. Overseers
in the American South were paid by immediate
results, such as the output of a plantation.
24. Slaves were bought for their ability to produce wealth that
could be appropriated by the slave-owners. In some parts
of the world, slaves were used as personal servants,
concubines, entertainers, or providers of other amenities.
Just how much wealth was produced by slavery as an
economic system has been a matter of controversy among
scholars. In Brazil and the United States, which had the two
largest slave populations in the hemisphere, the regions of
these countries where slavery was concentrated remained
noticeably poorer during the era of slavery and afterward.
The side effects of slavery were not negligible, especially in
the U.S., where the staggering economic and human Civil
War seemed to fit Abraham Lincoln's premonition that the
war might continue.
26. This limited the kind and quality of work that could be
performed by slaves, and ultimately led to their eventual ban
from being considered human beings. An ideal free market would
lead to slaves buying their own freedom, since they would have
an incentive to outbid others on economic grounds alone, even
aside from their desire for freedom. It is a common principle in
economics that assets tend to move through the market to their
highest valued uses, since that is where the bidding for me will be
highest. In ancient Rome, slaves might earn and save enough over
years to purchase their freedom for cash. Even where slaves have
had no money, or inadequate amounts, ways have been found to
arrange self-payment on credit. In other times and places, various
individuals or organizations might advance the money to purchase
freedom. In the Western Hemisphere, brotherhoods of ex-slaves
would sometimes redeem captives in exchange for their freedom.
27. The Catholic Church used its own money to redeem
captives and maintained emissaries in the countries
where they were held. In other times and places,
various individuals or organizations might advance the
money to purchase freedom. In the Western
Hemisphere, brotherhoods of ex-slaves would
sometimes advance the money required to purchase
the freedom of someone who would later pay them
back. North African pirates who raided the
Mediterranean coasts of Europe would sometimes sell
these captives back to their families. Some Southern
whites who did not believe in slavery often owned
slaves as a legal formality, while it was an open secret
that those slaves lived the lives of free people.
