We Have Labor Day; Why Not A Capital Day?

nogaWe Have Labor Day; Why Not A Capital Day?

By George Noga
More Liberty, Less Government

I have absolutely nothing against a national holiday honoring labor. My grandfather labored for 60 plus years until he was well into his seventies. My father and I both labored for over 50 years. Our spouses shared equally in the toil. All honest labor is noble, deserving of respect and yes – even a holiday.

The Origin of Labor Day

The earliest roots of the labor movement trace back to the first part of the nineteenth century when Robert Owen in 1817 began agitating for an eight-hour workday. Owen’s mantle was taken over by The Noble and Holy Order of the Knights of Labor, a secret society formed in 1869. They organized a parade in New York City on September 5, 1882 which turned into an annual event; this was the first de facto Labor Day in the USA.

Following the Chicago Haymarket riots in May 1886, President Grover Cleveland moved in 1887 to support the position of the Knights of Labor and to adopt their date of the first Monday in September to honor labor; it has remained unchanged since. Labor Day still was not a legal holiday however. That changed in the aftermath of the deadly 1894 Pullman Strike in which many workers and police died. Legislation making Labor Day a national holiday sped through congress and was signed by Cleveland six days after the end of the Pullman Strike. It since has become a state holiday in all 50 states.

Nexus Between Labor Day and May Day

Internationally, the holiday is celebrated on May 1 and it has a clear unionist, communist and socialist tenor. The International Workingmen’s Association, consisting mostly of anarchists and socialists, therefore pressed for Labor Day to be on the first of May. President Cleveland, fearing a May Day holiday would strengthen the socialist movement, raced to adopt the September date advanced by the Knights of Labor.

As conceived by Cleveland and congress, Labor Day was not about labor unions, parades or leisure but about celebrating the Puritanical work ethic. It was intended to serve as a reminder that work was an ennobling experience. Part of the reason it was placed at the end of summer was to symbolize the end of seasonal indulgence and a return to work. Its purpose was to be a clarion call for more, not less, work.

Labor Day and Labor Unions

Unions long have sought to co-opt the Labor Day holiday which was established to honor all labor and not just the small portion that is unionized. There once may have been a constructive role for labor unions in America. If so, that day long since has passed. The percentage of the private sector that is unionized today is at an historic low of 7% and shrinking every year. Only in the fetid, parallel universe of government is the union movement growing; it extracts politically what it cannot win via secret ballots of workers.

“In purely economic terms, labor unions are rent seekers. They extort uncompensated value from others.”

In economic terms unions are “rent seekers”, i.e. they acquire economic benefit via manipulation and/or exploitation of the political environment rather than through the production of added value. In short, they extort uncompensated value from others.Why Not Capital Day?

I do not wish to challenge the shibboleth that America was built by the sweat of the working man’s brow. What I do wish is gently to remind everyone that it was capital that made labor more productive through investment in plant, equipment and tools. It was capitalists who trained and organized labor to make it more fruitful. It was free markets that provided the incentives and rewards for success.

It was capital markets that provided the access to financing. It was capital that freed workers from 12-hour days and mind-numbing drudgery. It was capital that unleashed the greatest era of productivity the world has witnessed. In the ultimate irony, most workers have been transformed into capitalists via their IRA and 401(k) plans.

“Capitalism and capitalists are responsible for the cornucopia of blessings most Americans take for granted.  Let’s set aside a day to remind us of the virtues of capital.”

Labor, particularly unskilled labor, is a commodity. It has been present throughout human history. Raw labor is not scalable; it can be leveraged only through organization and capital investment. The entire history of the United States is about replacing raw labor with more productive alternatives – oxen, horses, steam engines and tractors. Indeed, our progress is inexorably linked to finding substitutes for raw muscle.

Let’s keep Labor Day; but let’s add a Capital Day. America is the quintessential capitalist country for which we should be proud. Capitalism is responsible for the cornucopia of blessings and material benefits that many of us take for granted. A mind boggling array of products is available everyday at ridiculously low prices at places like Wal-Mart and Costco. Medical miracles and wonder drugs routinely increase health and longevity. The fastest growing population cohort in America is from age 85 to 95.

Capitalism has proven so utterly successful that many Americans have forgotten the vital link between capital and our prosperity. Some Americans even have become apostates from capitalism. Capital and capitalists are indispensable to the success of America – past, present and future. Why not set aside one day each year to remind Americans of the virtues of capital? In keeping with the spirit of capitalism it need not be a day off from work!

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