The Encyclopaedia of Work of the Human Race would be an electronic book where the average amounts of human time required for creating products and services are stated.
Have you ever wondered while drinking a bottle of beer how much human labour was necessary for it to arrive in your hands? How much time did the miners and the glassworkers have to spend to produce the bottle, how much time did it take the farmers to grow all the ingredients and how long did logistical and other workers have to devote to it in order for this beer in its finished form to reach your table?
The labour theory of value (LTV) concerns itself with these kind of questions. Sadly this theory, that would help solve some of the pertinent problems with which we are faced, was never really applied. The realisation of this theory - the labour praxis of value (LPV) - is the main topic of this article.
The beginnings of the labour theory of value can be traced to antiquity and through history many thinkers have worked on it or thought about it. These include, for instance, Adam Smith, David Ricardo and Karl Marx. If we similarly ask ourselves how many hours of human labour are necessary to obtain a certain product, it might result in the following way of thinking.
For now I want to look at the a textbook example: what amount of human time is required to obtain a kilogram of bread?
Because bread is traditionally made from wheat, I then focused on the production of wheat and the question of how much human time is needed to produce it. After some searching for who could have such data, I discovered that in Slovenia, besides farmers themselves, the best source of such information is the Agricultural Institute of Slovenia.
If we calculate from their data, we find out that for one kilogram of wheat, on average 11.1 seconds of farmer's work is necessary (for comparison - for one kilogram of tomatoes 104.2 seconds of farmer's work are needed). But in this data only the farmer's work is included, all the other necessary work is not. A large part of growing wheat involves the use of a tractor and building a tractor also requires human time.
Therefore, we have to figure out from what materials and what amounts an average tractor is made and how does a tractor amortise itself per a kilogram of wheat produced. When we establish that a tractor is predominantly made of steel, ductile iron, rubber, etc., then we have to work out how many person-hours are needed to get the said raw materials, the time it takes to make machines to extract them, the time that is needed for all of the logistics, and so on.
The above-mentioned case is presented as an example to make it clearer what has to be done before we gather the desired information. However, all this knowledge already exists in our vicinity - it is part of our economy. It is true that this knowledge is fragmented and sometimes not explicitly formulated, but this is mainly because it is not gathered in one place.
First Encyclopaedia of Work (of the Human Race)
I believe we need to establish the The Encyclopaedia of Work of the Human Race, an electronic book where the average amounts of human time required for creating products and services are stated. This openly accessible dynamic database will become more accurate and precise with time as it will contain data for an ever-growing number of products and different ways of making these.
Of course, the beginnings of such a database will be modest as the data therein will be fairly imprecise and limited, but we have to start somewhere.
Therefore, we should not be afraid of dealing with approximations or with missing data for segments of production in this elementary phase, when we don't even know if something requires five or 5,000 minutes. With time and more data these errors and gaps of knowledge would become smaller and less frequent.
As mentioned before, these fragmented values are measurable and production managers know them well unless they are operating spontaneously or by intuition. For instance, one of the key data and indicators in the automotive industry is how much human time is needed to produce one car - the hours-per-vehicle factor (HPV).
Basically, we have two complementary approaches of how we can gather the required data:
Top-down (macro) methodology, where the values of human time necessary to complete a certain product are calculated from the aggregate data of companies, tax, and statistical offices (input/output analysis).
Bottom-up (micro) methodology, where segment by segment we follow the production process for a certain product and calculate and add up the time values required for its completion. To visualise this process better we can imagine the excellent Canadian documentary television series How It's Made, where at every step of production we add up the amount of human time required for a certain phase. Otherwise, the measuring and studying of how much time do workers need to complete a certain phase of production has a rich legacy in capitalism. The invention of the assembly line and Ford's mass application of it in 1913 to produce automobiles caused a real revolution in studying and experimenting with workers’ actions to complete products as fast as possible.
Both of the above-mentioned methods can of course be merged and the data can be compared and must be similar if the analysis were to be properly executed. It would probably be best if we start to gather our data for staple goods and later add more specific products and subtypes of these, different ways of making them, and so on.
Adequately defined methodology is crucial for a project like this; still, what is the most appropriate praxis clearly only time will tell. It is only natural that errors will happen, but, if we paraphrase the X-Files - the truth is out there. Our task is to write it down. But we can also label it clearly.
The Second Price
After our first question - how much human time do we need to produce something - we can quickly figure out that from this question stems another. Why aren't these time values publicly known? There can be many answers to this, yet the solution to this question is apparent.
We have to start labelling these values of the necessary human time for production. We already have a thriving practice of labelling more and more information on our products as we continue to develop our economy further. In this manner we can find information about ingredients, the nutritional and energetic value of the products, and the price labelled on them or on the shelves.
The idea is that from now on we would add to the classic capitalistic price another price of production, expressed in time, that would denote how much human time had to be spent to produce and transport a certain product so that it arrived on the market’s shelves. Or, to put it another way, this price tells us how many hours of human time society had to pay so that this product or service could be manufactured or completed.
We could also arrange this, for instance at the level of the European Union, which could pass a law that would mandate such labelling of the other price - the second price (e.g. an EU directive already requires that the energy efficiency of appliances is labelled and rated in classes from A to G).
At the beginning of this process standard values from the Encyclopaedia of Work could be used, but later, at least larger companies should be required to compute their specific data themselves. Furthermore, the Encyclopaedia of Work could be managed by the Statistical Office of the European Union - Eurostat or some other newly-formed statistical office dedicated to this task.
The UN level also comes to mind but sadly the UN is impotent, in a similar way to its predecessor - the League of Nations - for the same reason. Either way we have a long way to go before that. To begin with it would probably be best to form a social movement that would advocate and work on implementing the labour praxis of value. However, here we come to this question. Why should we do that?
There are three main reasons why it is good that we consider this endeavour of measuring human labour more objectively:
The ideal of the current capitalistic ideology is the state of perfect competition. One of the key features of it is that consumers and producers have perfect information.
The Encyclopaedia of Work and the second price offers consumers more information about the price they have to pay for a certain product and to producers they offer information about the costs they will have if they enter a certain production sector or they obtain another set of data to compare how competitive they are in their sector to others.
Therefore, with the application of the labour praxis of value we get closer to the ideal of perfect competition and to the concept of righteousness that is imagined by the proponents of free-market capitalism.
Another key feature of the state of perfect competition is the absence of externalities, which means that there are no costs or benefits that are imposed on a third party who did not agree to incur those costs or benefits. The labour praxis of value can help estimate these externalities better and include them in the prices of products, thus making the prices more just.
The inclusion of externalities is also one of the main questions concerning the pollution of the environment.
The Encyclopaedia of Work and the project of the second price are based on the principle that prices must include not only the work that is needed for the creation and transport of products, but that they must also include the work that is needed after the said production and transport to return the environment to as original or natural a state as possible (sanitation after production).
If, for particular products with the existing technology, this cannot be done, it must be clearly labelled that creating such products causes lasting environmental damage.
According to this principle products from China are not so cheap anymore as we have to factor in the human labour necessary to clean the air and water polluted by maritime and air transport from there.
Consequently, locally-produced products become cheaper in general than those transported across half the globe. Nonetheless, we could standardise these costs to some degree so that they are not calculated for every kilometre travelled by a specific type of transport but for every 10, 50, or 100 km of moving required by the production and transport of a particular product.
In addition, by the criteria of the labour praxis of value, the Chinese labour force is not cheaper anymore as it requires a similar amount of human time spent for production as the European or American labour force.
It may even be more expensive if, for instance, Chinese products are made in the concentration camps for Uyghurs or others as we have to include the time spent by the concentration camp guards and the time costs required for maintaining the infrastructure of the concentration camps. By this methodology forced and slave labour is not as “free” as it is now.
Human time is a key element of organising a human society. To see that this is true we just need to observe our capitalistic system and its ubiquitous fetish of punching in time clocks as we arrive or leave work as this forms the normal basis of our wage and pension systems.
Therefore, reflections about alternative or supplemental economic systems based on human time do not represent a revolutionary way of thinking, but they do represent possibilities for development where our current economic system is lacking. For example, it is tragicomical that we still utilise an economic system that has built-in cyclical crises as a fundamental and unavoidable feature.
The reason for this is because we live in a time of a subjective economy. We have given primacy to an economic system that is based on emotions and faith and the chaos caused by both of them.
For example, when a CEO of a large company got high in a studio during an interview, the value of the company's shares dropped considerably. Was this an objective reason for the fall in value? Did the products of the company become of lower quality overnight or were they instantly selling lower amounts? No, only the perception has changed, objective factors did not.
We have neglected the objective economy. The economy, where prices are not profit-driven and which serves to fulfil needs before wishes. The economy, where it is more important to objectively and normally survive than to subjectively and infinitely want.
But how would such an economy look like? Primarily this would be an economy of mass products and not an economy of capricious products. The labour praxis of value could constitute its firm basis.
This would be a system where cooperation is paramount and not the tyranny of competition or with everybody fighting against everybody. In the current capitalistic system the price of products serves as a signal for the market to increase or decrease supply or demand for these products.
This represents one of the main ways in which information for organising the economy is communicated. Yet there is no need to still coordinate our economy in such an indirect fashion as the invention of the Internet has enabled a democratic revolution of data input.
Nowadays it is possible that producers and consumers cooperate directly and communicate their needs and expectations in real time, develop products together, order them, and vote for the creation of new products. Existing online shops can give us some idea of how a democratic economic network of all the products and potential products for the whole economy would look like. All of this is now achievable.
But where can such an economy begin? If there is no political will for it, the most suitable place for such a parallel economy to grow is probably in the field of private property, which in capitalism is sacred and untouchable and as such it represents a place of freedom. The rich heritage of cooperatives around the world can serve as an example.
With these three reasons we will conclude the outline of our topic. And when speaking of utopias, the biggest existing utopia by far is that we can have the economy as we have now for an unlimited amount of time. Because of this it would be good that we become open to solutions.
The labour praxis of value can thus represent a good beginning on our path to a more secure future for us and for our environment.
Sašo Miklič is a political scientist from Slovenia and took part in protests from 2011-2013. During this time he wrote several articles about democratic reforms, direct democracy and liquid democracy published in the leading Slovenian newspaper, Delo. Miklič also supports and work with Ecologists Without Borders, a Slovenian NGO. He is currently helping a friend build a bear observation post.