Book Excerpt: 'The Separation of Church and Estate' by Tylor Standley

 
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The following is an excerpt from Tylor Standley's book The Separation of Church and Estate: Capitalism and the Christian Conscience.

Magic

Milton Friedman was an American economist and a champion of capitalism. He wrote and spoke extensively on the virtues of the “free market.” He liked to pull a no. 2 pencil out of the breast pocket of his blazer and look at it admiringly. “There’s not a single person in the world that could make this pencil,” he’d say. He would talk about the materials that composed the pencil and speculate on their origins. The wood may have come from Washington. But to get wood you need a tree, and to get the tree, you need a saw. To get a saw, you need a steel mill and ore. He’d talk about the graphite “lead.” He heard that graphite comes from somewhere in South America. The rubber that composed the eraser was harvested in Malaysia, a friend once told him. Then, there is the aluminum ringlet that holds the eraser to the wood. The yellow paint that coats it, and the black paint used to stamp “no. 2” on its side could have come from anywhere. It takes countless people all across the globe just to make a pencil.

What brought them together to produce such a simple yet complex object? “There was no commissar sending out orders from some central office,” he said. “It was the magic of the price system, the impersonal operation of prices that brought them together and got them to cooperate to make this pencil so that you could have it for a trifling sum.” He goes on to tell how this free market system fosters “harmony and peace among the peoples of the world.”

Marx also spoke of the magic of the price system. He talked about how capitalism turns people into mystics. Somehow, magically, money can accumulate more money based on the way you produce and price an object. Somehow, you can sell pencils for a quarter and everyone is happy and rich. Marx called this magic the “fetishization” of money. Rather than marvel at the mystery, Marx pulled back the curtain to show what actually happens in this process. He wrote, “The whole mystery of commodities, all the magic and necromancy that surrounds the products of labour on the basis of commodity production, vanishes therefore as soon as we come to other forms of production.”[1] In other words, the lumberjack knows the work he put into harvesting wood. The woman in Malaysia knows what it took to harvest rubber. The chemist knows what he needs to make paint with the right color, consistency, and dry-time. More importantly, they all know that their work makes their bosses rich.

Friedman almost gets there, but he stops short—as if it takes some sort of leap of faith to believe in the magic of capital accumulation, as if the world will never understand what the workers already know. When you buy a pencil in the store, all you know is the finished product. You are confronted not by the sweat of the graphite miner but by the cashier who dryly mumbles your total. You are left hanging in the mystery, wondering in awe at the twenty-five cent pencil, at how all of this could have come together and still only cost you a quarter.

I’ve already spent some time talking about surplus value and wage theft elsewhere. To review, value is created by the labor of workers. The division of labor makes it possible to make the pencil for a penny and sell it for a quarter. The worker might see a penny of that. The capitalist sees the remaining twenty-three cents. The more pencils the workers make, the more money the capitalist makes. Magic. While the capitalist pockets the value created by the workers, those workers remain unskilled, undereducated, and lifeless, just as Adam Smith predicted. But let’s just think for a moment about Milton’s pencil. Let’s explore further up, further into this mysterious process.

Friedman mentions the graphite mines in South America. Actually, most graphite comes from China. Seventy-five percent of the world’s graphite supply is harvested by a single company: BTR New Energy Materials, Inc. You might think, “Well, that can’t be too much graphite. Who uses pencils anymore?” You may not use pencils to write, but you still use graphite to write. I’m using it now, as I type this book. You used it last night when you wrote a text to your mom. Graphite is an important component to batteries— phones, computers, cars, everything with a battery uses the stuff. That’s a lot of graphite. Let me say it again: seventy-five percent of that graphite is harvested by a single company.

In a 2016 exposé “In Your Phone, In Their Air,” the Washington Post revealed the living conditions in the graphite towns of China. Earlier, we discussed externalities, the costs of the capitalist mode of production that the capitalists don’t have to pay—the environmental and health impacts of production. The people who live in graphite mining communities know about externalities. They are the externalities. Graphite dust perpetually hangs in the air, leaving their walls a grimy gray. Cleaning anything is a futile effort. Worse, it coats and kills their crops. Most families rely on home-grown vegetables, but the pollution makes it difficult to sustain. The few crops that survive leave the locals wondering whether the polluted fruits are safe to eat. That’s not the half of it. Even the water is toxic. The once-clear well water is now gray with cloudy residue. Villagers pinch their noses to avoid the smell of nearby polluted ponds. The Post reporter recorded a conversation he had with one of the locals, Yu Yuan:

“Of course I would move if I had money!” Yu added, a trace of anger straining his face. “Who would want to live in this mai tai [dirty] place? Here the dust is everywhere.”

People in mining towns don’t willingly sell their labor for less than its worth, destroy their environment, fill their children’s lungs with black clouds of dust, and kill their crops. That capitalists call this a “voluntary exchange” would be laughable if it weren’t so morbidly sad.

Friedman was right about the source of rubber. Rubber is still a crucial part of the Malaysian economy. Plantation workers are among the most exploited of the nation’s working population. When Friedman told the story of his pencil and the happy Malaysian workers harvesting rubber for his pencil eraser, Malaysian unions were fighting against the capitalists to get the Malaysian government to enforce a minimum wage (note: not higher minimum wages, a minimum wage, period!). The unions wanted to get plantation workers at least to the poverty line of $25 per month. That was in 1990. Their efforts failed and the market remained free to exploit them. After a few years of fighting, a few small moves were made to pay workers marginally more. That’s when the plantation owners began hiring contract or “casual” workers who have fewer rights and were ineligible to join unions.[2] Casual workers have no job security and are paid up to 75% less than the district’s minimum wage.[3] Why pay more when you can pay less?

Rubber plantations exist all over the world. One of the largest consumers of rubber is the world’s largest tire producer: Firestone. In 2011, a US court ruled in favor of Firestone’s use of child labor in Liberia. The rubber tappers could not meet the quotas set by the bosses, so they had their children help lest they lose their jobs. The US court essentially said, “At least these kids have some money now, unlike other Liberian families without jobs.” Think about that. Plantation owners force their workers to produce more than they are physically capable of producing on the threat of losing the ability to feed their children. And the US courts have the audacity to say that these six-year old children should be thankful for their jobs.[4]

Rubber has been replaced by palm oil as Malaysia’s primary export. Malaysia is the second largest producer of palm oil in the world, just after Indonesia. Palm oil is much more important to the local economy than rubber. In recent years, the palm oil industry has come under heavy criticism from human rights groups. Palm oil plantation owners place the same oppressive standards on their workers as those from rubber plantations—impossibly high quotas that force the recruitment of children or “casual” (contract) workers. Beyond the exploitation, the environmental impacts of palm oil and rubber expansion are devastating. Indonesia’s tropical forests are home to a vast and diverse biosphere. Thanks to expansion, the forests are quickly being cut down for plantations, causing destabilization of the habitat. Forest fires have also become a major problem, due to the methods for clearing forests. They call it “slash and burn.” As the name implies, they cut down the trees and burn the timber. It’s a quick, cheap way to clear the land. It has also resulted in dozens of direct deaths, hundreds of thousands of respiratory infections, and upwards of 100,000 indirect deaths in 2015 alone. Indonesian people, animals, and climate are expendable. They are externalities. Without regulation, these companies have no intention of stopping the practice. Capital doesn’t stop for dead children.

[1] Marx, Capital, 169.
[2] Marvin J. Levine, Worker Rights and Labor Standards in Asia’s Four New Tigers: A Comparative Perspective (New York: Plenum Press, 1997), 393ff.
[3] Rainforest Action Network, “The Human Cost of Conflict Palm Oil” (June 8, 2016).
[4] Reuters, “Firestone wins Liberian child labor case in US” (July 12, 2011).

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Tylor Standley

is a writer and co-host of Podcastica Patristica. He is co-author of Divine Providence: A Conversation and and Arius in His Own Words, the first ever stand-alone translation of the works of the fourth century heretic Arius. His book The Separation of Church and State: Capitalism and the Christian Conscience is now available.