Sunday, March 01, 2009

A question about profit

In a society where there is perfect justice (and virtue), would it be possible for producers to make a true profit?

1 comment:

Anonymous said...

It depends what you mean by 'profit'. In its conventional use, I would think so. The work of the worker adds to the value of the thing produced. So if it were sold at "what it is worth", including the worth of the work, a profit could be made. If profit means charging more than it is worth, then I would say it is not just.

Saint Thomas nods in this direction (II-II q. 71, art. 4, reply 2) when he says, for instance: "Though knowledge of law is something spiritual, the use of that knowledge is accomplished by the work of the body: hence it is lawful to take money in payment of that use, else no craftsman would be allowed to make profit by his art."

There are other ways, besides the human work, that increase the value of something, like exchange. A mere change of place can do this; that is, selling something to people "over there" who don't have an abundance of whatever it is you make renders it more valuable than it would be to people "over here". Aquinas admits this as well.

You also might be able to formulate a general argument like this:

Human living requires a certain standard of subsistence, but capital is necessary to obtain this. But profit is needed to have capital. Ergo....

(Capital being defined as Belloc defines it: "an accumulation of wealth made in the past used up in future production.")