A Refutation of the Incentivization Problem & Communism
This article was originally written by Evan J. Doerr for yipinstitute.com
Karl Marx, and the system he envisioned, have come under criticism since their conception. I will now be addressing the incentivization argument. The perpetrator of this argument will find communism to fall because of a lack of material incentive. Individuals will not act as Marx envisioned, but rather grow to be lazy creatures who will not continue to work to the same degree as they would under an economy dominated by the capitalist mode of production. How do Marx & Engels answer this apparent dilemma? And how would the process of labor appear different from a capitalist society?
To begin, we will look at a total explanation of the argument and where it stems from. There are essentially two categories of incentives. The first is intrinsic incentives. Intrinsic incentive is motivation that comes from one’s own will. I desire some event or object to exist or come to fruition, so I act in such a way as to attempt to secure its existence. It must be noted that this is for my own satisfaction, fulfillment, for example, I might want to study Marxian theory in my spare time, for a sense of satisfaction of understanding Marx (If only others took up this pursuit before attempting to critique his system!). Extrinsic incentive is motivation that is caused by material items. They offer an external reward for the successful completion of a task or threatening some punishment for a failure to adhere to said task or rules (Understanding Incentives in Economics: 5 Common Types of Economic Incentives). For example, in a free agreement, someone might agree to give another person $5.00 if she helps them with their homework. Likewise, a parent might punish a child by withholding a possession of theirs, if they have behaved poorly. It is important to note that individuals in both scenarios are not motivated by themselves, but rather material items they gain or lose by adhering to a certain behavior.
What is the primary motivator in the capitalist economy? The clear answer is money. Money is the basic unit by which the exchange value of commodities is estimated and able to be exchanged for. Man’s existence within the bounds of a capitalist economy is predicated upon the ability of himself to acquire money and exchange it for his necessities, good necessities that ensure his own survival, so that he may show up tomorrow to again sell his labor-power. They consist of products such as food, water, shelter, clothing, healthcare, etc. If there is any money left over after the exchange for necessaries, he then saves that value or spends it upon luxury items (Goods not necessary for survival). Please note that wages have only risen to support a large number of luxury items in our economy due to the creation of a minimum wage, as wages in a non-interventionist capitalist economy tend to decrease. We then understand that the capitalist economy functions primarily upon extrinsic incentivization through currency. Marx understands the lack of intrinsic incentivization to be caused by the functioning of the capitalist economy itself, alienation. Yet, that is a topic for another day.
Workers are structurally coerced to sell labor-power in order to fend off starvation, dehydration, etc. They are prevented from acquiring those items because of property law. They need the very goods that require their existence and the only process for them is to work within the capitalist economy, selling labor-power for less than the change in value it generates. So, they work long, hard hours. They build up the capitalist society, there is no room for laziness, lest one end up on the street, hungry, or unable to care for his family. As the amount of workers grows, so naturally does his work ethic. He must work harder and harder, competing with both machines and his fellow man for the means of subsistence.
Without private property, exchange values, and therefore money, proponents of capitalism (read wage-worker with Stockholm Syndrome) argue that universal laziness will overtake a communist society. Productive members of society will succumb to sloth. Humanity will become rats, fighting amongst one another for the few bits of bread that are produced. Dear reader, depict as you will what could happen to our society if profound laziness overtakes us. I assure whoever is reading this, it would not be a pleasant experience.
Individuals will act according to a principle I have coined as egotistical mutualism. You can read that article here. Essentially, an individual’s needs are best met through working for the needs of others. If said individual produces a good necessary for the livelihood of another, it allows other individuals to do the same for him. If I bake bread for the doctor, the doctor can then take the time to learn medicine and treat me or my family, if need be. This is the principle by which a common, internal distribution will follow. Please also note I am presupposing a functioning voluntary collective.
Communism has a common, internal distribution. There is a lack of commodity exchange. If an individual decides to enter into a collective community, producing something for the society, he will receive the full benefits of that community. This is a deal multiple times better than any offer of a capitalist economy. “From each according to his ability, to each according to his needs” (Marx, Critique of the Gotha Program). If you said to a man “If you work selflessly, working with your fellow man in place of against, for the betterment of all, you will receive the full benefits of your society whenever needed. Do you accept [it]?” any sane man would say “Yes!” It is clear that this arrangement of distribution would appear superior to any man.
The capitalist sympathizer now goes “Aha, I’ve got you now. Why won’t individuals simply lower their work ethic and not care as much if they know they’ll receive the full benefits of said society? Why would certain individuals study long to become doctors (substitute any high-skilled profession you like)?” Note that “higher-skilled” and “lower-skilled” labor are simply bourgeois terms. I will use them as they apply to the capitalist economy and their terminology. It will suffice to say that I simply reject distinctions in labor based upon skill.
Marx & Engels make somewhat light of the situation when they explain:
“It has been objected that upon the abolition of private property all work will cease, and universal laziness will overtake us. According to this, bourgeois society ought long ago to have gone to the dogs through sheer idleness; for those of its members who work, acquire nothing, and those who acquire anything do not work” (The Communist Manifesto).
They essentially argue that with the birth of bourgeois society comes the exploitation of the working class, with certain rates of their day not going to themselves, but rather to the capitalist (surplus value). They do nothing but own the means of production, yet leech off of the proletariat. Although this does not address the point that the arguer is attempting to make, I feel it is important to note that those who do little to no work at all rip away the work of the working class. The lazy ones become the rich and the hard-working ones are left behind to make their fortune for them!
Regardless, we will now address the idea that individuals will opt out of higher-skilled labor without a greater material incentive than those of their lower-skilled laborers. Also, the arguer, without realizing it, has conceded Marx’s theory of alienation. They have agreed that capitalist production forces individuals into fields that don’t suit them and leaves them dissatisfied, estranged from the product of their labor. Anyways, why would one become a doctor? A scientist? A
The answer is intrinsic incentives. Individuals overwhelmingly wish to learn, prosper, help others, to satisfy themselves. In 2017, the American Medical Association conducted a study that found the top reason that medical students pursued the physician profession was the desire to help others. The same is true with the science industry -- many individuals are moved by both concern for others and their own curiosity on those subjects. In place of many individuals being condemned to degrading, wage-labor for a majority of their life, individuals would have the ability to specialize. How many Einsteins were entrapped in wage-labor in place of studying? In place of laziness, I have little doubt that when people are given the opportunity to reach higher levels of jobs, they will enjoy them. Yet, what of those who don’t aspire to do 'high-skilled' labor? What of the 'low-skilled' laborers? Why will they work, if their work is truly as alienating and terrible as Marx and I say?
It is rather simple; if an individual has no aspirations to do the 'high-skilled' labor of his comrades, he can simply opt to do those menial tasks in exchange for the common, internal distribution of products he may need. Take a stay-at-home parent whose role in the nuclear family is to care for children and complete domestic chores. As I have elaborated before in my article on egotistical mutualism, if an individual wishes to not participate in this commune, he may live on his own self-sufficiently. Communist society must be voluntary in nature, and I have no doubt it will need to be such. Also, communist society requires a high level of automation of production processes, so I don’t imagine many individuals needing to do menial tasks.
To sum up, individuals in communist society will have the ability to do ‘high-skilled’ labor if it suits them, their own intrinsic incentives. If they do wish to not take on this path, they can simply opt to do ‘lower-skilled’ labor. If the demand for either of these professions is too high, individuals will either change paths selflessly in order for the benefit of all or there will have to be a time-share labor agreement made, were a let us say an individual works a few hours in a community kitchen and as a scientist in the laboratory. Also, if we can decide if a time-share is valid based on the utility expression: (utility gained by all through consuming a new product or service of a ‘higher-skilled’ type - utility lost by asking workers to time-share into uninteresting jobs) is < or > (utility gained from workers fully enjoying their jobs within a society - potential gains in utility from the alienated creation of a new good or service).
Another potential objection a capitalist-sympathizer may make is that socially necessary labor time may rise if individuals are solely bound by the clock in certain areas of the economy that provide goods. Here’s a hypothetical to illustrate this point: a man assembles 5 chairs per hour at a wooden chair factory. He keeps up at this rate because if he were to slack off, he would be promptly fired, replaced, and no longer have the means of subsistence to care for his family and himself. Yet, let us imagine that a communist society has been ushered in successfully overnight. Now, he is only asked for 4 hours of work in order to keep membership with the commune and have the full benefits of society. Yet, since the man has membership based solely on 4 hours of work, let us say that now, he produces 4 chairs per hour, rather than 5. If this phenomenon is reproduced widely, there will be a decrease in supply of chairs. Substitute any produced good, it does not matter. The solution is to offer a quota based upon socially necessary labor time. In place of requiring someone to simply work a certain amount of hours without a small expectation of the quantity/quality of goods, we say to the individual making chairs that he is free to leave when a certain quantity of goods. If the commune calculates socially necessary labor time to be 5 chairs per hour and there is a need for say 20, the individual will be given leeway as to how to produce the chairs, with a maximum of 4 hours to produce those 20 chairs. He will be incentivized to do his work faster to leave the workplace and enjoy the rest of his society while also decreasing socially necessary labor time. Yet, since some of his free time will create more demand for other goods and services, (he will likely be asked to move industries, if necessary based upon the utility calculation done above), he will then be asked to do a base # of hours based on the discounted rate (the amount of hours distributed equally) or a quota calculated based upon the increased amount of socially necessary labor time. This process will perpetually further drive down socially necessary labor time. The process I described cannot occur through a capitalist economy. Individuals are discouraged from innovating basic production at a small level (excluding jobs geared for raw research, obviously) but rather sit out much of their day staring at the bane of their own existence: the clock.
In short, I have fully addressed the incentivization argument. This was a simple defense of Marxian systems. Incentivization in no way is a struggle for a communist society to grapple with.
Marx, Karl, and Friedrich Engels. Manifesto of the Communist Party. International Publishers, 2017.
Marx, Karl. Critique of the Gotha Program. Wildside Press, 2008.
MasterClass. “Understanding Incentives in Economics: 5 Common Types of Economic Incentives.” MasterClass, 8 Nov. 2020, www.masterclass.com/articles/understanding-incentives-in-economics#what-is-the-definition-of-incentives.
“Survey: U.S. Physicians Overwhelmingly Satisfied with Career Choice.” American Medical Association, 30 Mar. 2017, www.ama-assn.org/press-center/press-releases/survey-us-physicians-overwhelmingly-satisfied-career-choice.