The capitalist parasitism of billionaires

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Recently, we saw an article regarding how the collective net worth of the richest Malaysians increased by 14% in 2021. This is with the background of a global pandemic which has hit Malaysia with 3 lockdown events and over 3000 deaths. The Malaysian GDP even contracted by 5.6% in 2020, with many Malaysians losing their income through job losses. It is abundantly clear that between the billionaires and common Malaysians, we live in very different worlds, one where next to nothing affects the rich and they contribute very little to alleviate the suffering of everyone else.

Increased taxing of the rich is a proposed solution. Of course, a wealth tax, say 5% per annum, on just one of these billionaires, say Robert Kuok whose wealth is about RM 50 billion, would free up RM 2.5 billion per year. This can allow for a financial aid scheme of RM 2000 per month for 104,000 families each year. However, with capital flight in mind, the extent of legal control can be limited. We must realise that the existence of billionaires itself is proof of an inherently exploitative system, otherwise known as capitalism, which we must overhaul towards a socialist mode of production.

Consider the following. Say one makes RM 10,000 a day and they saved every sen, it would take 274 years to save RM 1 billion. Does it make sense then that billionaires’ wealth is earned legitimately? In actuality, their wealth comes from the extraction of profit from the labour of others. Just as barons in the 19th century profited off of land they “owned” through exploiting the labour of peasants that worked the land, billionaires use their ownership of the means of production to utilise workers to turn raw materials into useful products, thus creating profit.

This is a perversion due to the fact that those who own the means of production are not the ones expending labour to create extra capital. Some would say that this labour was freely bought through the distribution of wages. However, the wage paid for the labour is markedly lower than the amount of profit generated. This is how businesses make money, of course, their revenue must be larger than their expenditure which includes labour costs. However, taking out wages, maintenance and other overheads, there are still excess profits (or surplus value) that is taken by owners of businesses.

This is illegitimate as the only reason capitalists obtain these profits are due to the fact that they had capital in the beginning. A person without this capital is forever locked out the extra income that is obtained. This becomes a vicious cycle where those with capital keep growing their wealth whilst locking others out of ownership of the means of production to forever depend upon the capitalists for income. The system is conducive towards the rich getting richer whilst the poor stay poor.

Moreover, those who create the profit, i.e the workers, do not decide how this profit is utilised. In a business, it is understood that not all profits can go to paying wages. Other than maintenance, bills etc., some need to go into expanding the business and other ventures. However, how fair is it that all decisions on how this profit is spent are made by a select group of business owners divorced from the opinions of those who generate that profit? How fair is it that workers do not get a say in determining their wages, which direction their company grows towards or other such decisions?

The same can be said for those who tout they deserve their high returns on investment as investing itself carries a huge risk. However, taking this very risk is only possible when one has access to capital. When that capital itself is illegitimately stolen from workers, how legitimate is that argument? These workers did not assess the risk, they do not decide to invest the profits they made and they do not reap the rewards. Moreover, investment in a capitalist system is parasitic. It assumes infinite growth from a finite number of resources. There is no thought going to preserve these resources for future generations. It is inbuilt into capitalism that a dearth of resources will be reached and capital will cannibalise workers through suppression of wages, as is happening now.

The fetishization of millionaires and billionaires is the commercialisation of oppression. The system sells the end product of robbing value created by the labour of others as if it is something to be longed for. Striving to produce more billionaires does not in fact increase wealth for all, it freezes more common wealth in the hands of a few, taking away capital from the control of the masses, forcing them to sell their labour ad infinitum and furthering exploitation of labour. In this sense, capital commercialises suffering and exploitation. We are reducing survival and comfort to commodities to be lost and gained, depriving them from those who are too poor to live.

What, then, is to be done? We must realise that we must move from private capital hoarding to an economic system built upon common ownership, with the people directly owning the means of production. This means two things: first, they must have a say in how the profit is spent and second, they must reap the full benefits of the value they created. At the micro level, this can be worker-led companies where all business decisions are made by a council of workers, not boards of directors filled with private owners. At the macro level, enacting a state-controlled collectivisation of the means of production where the state makes decisions on larger economic movements.

However, when we talk about government control, it must be understood that the way the government works should change dramatically. Now, government is just voted in every 5 years and the power of the masses to enact change is frozen until the next election. Between elections, elected officials essentially behave as they want to, which is why many do not fulfill their election promises or can easily be bought over by their political opponents. This was readily demonstrated during the 2020 Malaysian parliamentary crisis, otherwise known as the Sheraton Move.

Government reforms that need to be done have to prioritise the flow of the people’s will from the grassroots to the top. In an area, say each district, mass meetings must be held regularly to debate local and national issues to synthesize the needs of the masses at that time. This should then flow up to a greater governance level, say at the state level, and so on until the national level. This will accurately capture the needs of the masses at all times enabling elected officials to act upon them.

Augmenting this model with greater power given to the masses directly, say if they had the power to enact recall elections to call back an elected official for their area if they are disappointed with their output, would enable the common man to express their power at every level. Even more so if the very candidates for their local, state and federal seats need to be approved by these mass meetings.

What this means economically is that the common man gets access to the power to decide how the governance of large, state-controlled enterprises operate. Even more so if specific voices from workers in all economic sectors can be obtained as well, through the aforementioned micro model. Hence, elected officials have to obtain the approval of the masses regularly for overall economic decisions. At a macro level, the access to the will of the people can give insight of what the people need at that time. This can inform how government plans can be formed and be more relevant.

Conclusively, we can say that billionaires are borne of capitalism, a system that emphasizes exploitation. Capital held by billionaires deprives the common man of much of his needs even when this capital has been created by the common man and is stolen from him by the rich simply because they own more capital. To move away from this exploitation, taxation of billionaires is not enough. We must move towards seizing the means of production through a common-ownership model. In the end, private capital has caused much of the inequality we see today. We must destroy the system that prioritises it and move towards a socialist mode of production.

Arveent Kathirtchelvan
Committee Member
Pemuda Sosialis
Parti Sosialis Malaysia

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