Labor is a commodity, just as wood and paper are, and that, in essence, is the workingman’s or poor man’s dilemma.

“You’ll never get rich working for someone else,” goes the saying and true r and to many, crueler words have never been spoken.

Labor is a commodity, just as wood and paper are, and that, in essence, is the workingman’s or poor man’s dilemma. Business responds to consumer demand and that is all. It doesn’t matter that most consumers are also workers, because the consumer demands quality goods at affordable prices and that puts pressure on the businessman to reduce the costs of production by seeking always and everywhere to reduce the price he pays for the commodities he needs to produce and distribute his products.

Most commodities, like wood, paper and plastic have rather fixed prices – labor is required to mine or grow the compounds needed to produce them, to manufacture them and finally to market and distribute them. Labor is the primary commodity in which business must always turn to for “productivity gains” – that is, getting more work per worker for the same or even less pay via automation which allows the business to shrink the workforce and maintain productivity.

There is no relief for the workingman from his dilemma because it’s self-inflicted. The worker wants to believe that his predicament is the result of avaricious businesspeople, but it’s the result of both his demands as a consumer and the culture he’s a part of’s demand for ever increasing efficiency.

Real poverty is not merely the lack of funds to live well. True poverty lies in the lack of skills or the inability to create or innovate, for that is what separates those who have from those who have not. A common fallacy among those who believe there is a fixed economic pie and that one person’s gain is everyone else’s loss, is mistakenly believing the bulk of the accumulated wealth in the world is received through inheritance. That is simply not true . The vast majority of millionaires today are first generation millionaires. Most have made their money through investing or running their own businesses.

Selling labor, especially unskilled labor is a losing proposition and nothing can be done about that. In America, both large corporations and well-off individuals have always pressed for more immigration, as immigration puts a downward pressure on wages, especially for low or unskilled labor.

What’s more, everyone’s guilty of the same crime they chastise business for – “getting the most bang for your buck.” When working people buy goods or pay for services from car repair to landscaping, they always seek out the best/lowest price and that puts the same downward pressure on wages that “the bottom line” puts on businesses.

How can we expect business to act any differently than we act ourselves? Business is under the same economic constraints as individuals are. Higher costs of production and higher taxes equate into higher wholesale and retail prices.

So that is the workingman’s dilemma in a nutshell. Higher wages always result in an upward pressure on retail prices, taxes (to pay civil servants more) and inflation, as government increases the money supply in response to this new demand for currency. What’s worse, labor cannot really consider the possible detrimental effects of their own wage increases in an environment in which all other labor organizations are seeking the maximum benefit for themselves and their workers.

With higher wages being inseparably linked to higher prices and higher taxes, the workingman is stuck between the proverbial rock and a hard place.

What can be done?

How about freezing local taxes while raising municipal salaries? No, not possible, as that would force local government into deficit spending (many local municipalities have mandated balanced budgets) and even if they didn’t that kind of debt eventually gobbles up a disproportionate amount of the tax base just to pay the interest payments.

How about freezing retail and wholesale prices while forcing business to raise salaries? Now that’s even more impossible than the first (above) option. Businesses can’t go into deficit spending and the more debt a business takes on, the less stable that business becomes. Raising the salaries of labor while freezing the prices that business can charge for the goods and services that labor produces would ultimately bankrupt business.

So, what can be done?

At this point, nothing.

The reason we sometimes think that something can be done is that we mistake money for wealth and its lack for poverty. Wealth is not merely the state of having considerable money, but the creative ability to generate large sums of money through your own ideas and the leverage of salaried labor.

Likewise, poverty is not merely the lack of money, but the lack of the requisite skills to generate money by creating either businesses or creative endeavors that produce streams of income.

Working or selling labor is the most difficult way to make money because it depends on the creativity of others. The only protection that workers have been able to avail themselves of is Unionization – creating labor organizations that deal with businesses to hammer out workable wage deals. But the way that Unionization really helps its membership is by crating an artificial shortage of labor – a shortage of “Union labor,” by limiting access to the Union. Members have to either purchase a Union book (for a considerable sum) or in the case of Municipal Unions, take various Civil Service Exams designed to limit access to these positions.

So even these organizations don’t really protect ALL workers, merely those who are fortunate enough to enjoy Union membership. In fact, these organizations hurt the rest of the workers, except in the “Right to Work” states of the South.

Even the advent and ascendancy of the Labor Union, which reached its zenith in the 1960’s, hasn’t been able to raise the relative wealth of workers, though it has succeeded in improving safety and working conditions, raised worker salaries and improved some worker benefits with a concomitant rise in prices, taxes and inflation (increased currency placed in circulation).

There remains no way to increase the cost of labor (raising salaries) without placing an upward pressure on the costs of all goods and services, as well as taxes. The upward pressure created by increased wages is always balanced off by the upward pressure it puts on prices, taxes and the money supply.

So what does all this prove? Only that the old saying quoted at the start is inescapably true – “You can’t get rich working for someone else.”