Risk as Profit
Two assumptions are made by the capitalist in justifying retaining surplus value for himself: (1) that he took the labor in setting up the paperwork for the business, getting permits from the government, conducting feasibility studies, etc., and (2) that due to the inherent risk of the business' failure, where in the meantime he would have to pay wages, maintain machinery, and settle his electric bills. These factors, according to him, come at a loss in the first case, and a possible loss in the second case. So, the fruits of surplus labor should be expended to (1) compensate him for realized losses, and (2) maintain a reserve fund (controlled by himself) to pay for possible losses. This fallacy has already been attacked by Marx in his manuscript "Theories of Surplus Value," where he addresses the "Bourgeois Conception of Profit as Reward for Risk." Here, he presents a dialogue between a capitalist (A) and his employee, a worker (B). A starts off by making t...