I honestly want to understand your reasoning. — Fusilli Al Dente
FAD, I'm not trying to sell you on socialism or capitalism here. I'm just trying to explain the basic theory.
Where does "profit" come from under capitalism?
Mr. Candyland owns the 'means of production': the stores, the counters, the popcorn poppers, the big copper kettles where caramel corn is made, the candy making machines, tons of popcorn, tons of sugar, tons of butter and oil, and so on. Mr. Candyland doesn't actually do any work. He hires people (his employees) to do all the work. All the stuff sitting in storage (popcorn, sugar...) has some, but not great value. What workers do is change cheap kernels, sugar, butter, salt, and oil into fairly expensive caramel corn. The raw materials become much more valuable after workers have transformed them into the delicious snack. Same goes for candy or salted popcorn. The value of the stuff in the popcorn box is worth maybe 10 times as much as the unpopped kernels in a barrel.
Profit is the difference between the raw material and finished goods, less the cost of materials, wages, and overhead.
Mr. Candyland puts the profit in a bank and enjoys his leisure time. The popcorn workers, on the other hand, barely make enough to scrape by. (Karl Marx:
Value, Price and Profit)
What socialists propose is eliminating the owning class (because they are, basically, parasites). A basic idea of socialism is that the people who produce caramel corn with their blood, sweat, and tears should be the primary beneficiaries of their own labor.
Let's say Candyland existed in a socialist economy. What would be the same and different? The popcorn would still be delicious, if the recipes were followed. The workers would still have to buy raw materials -- popcorn, sugar, butter, oil, salt, and so on from other socialist suppliers. They would still make the popcorn products and sell it.
The difference is this: the workers would keep all the profit left over after all the bills were paid.
The same would go for steel mills, auto plants, clothing factories, and grocery stores. Nothing would be operated to generate profit for people who did not do any work. Those who did the work would benefit.
Labor creates all wealth, and the wealth it creates is really quite an enormous pile.
True, it is difficult to sue the State. For one thing, the State can decide that it would prefer not to be sued and the Court (part of the State) can dismiss your suit. Secondly, sovereign states are indeed very powerful.
While the states do protect individual citizens to some degree, they are especially anxious to protect the interests of large corporations (like Microsoft, Exxon, Apple, Boeing, ATT...). As Karl Marx put it, "The state is a committee to organize the affairs of large corporations (and their owners)." (paraphrase)
So, if you are a worker trying to organize a union, you will find that the state has passed laws making it quite difficult for you to complete the process of union organization. Law, in the United States, as very unfriendly to workers who want to organize for better conditions.
Corporations want to keep the cost of workers as low as possible, and the rate of profit for the owners (stockholders) as high as possible. That's why the richest 5% of people in the US have more wealth than the poorer 95%..
Huge gaps in income are not sustainable. They tend to undermine the health of society on which all depends.