In 1985, the British rock band Dire Straits released the song “Money for Nothing.” It is an undeniable rock classic. It also is a superb entry point for—of all things—judging the morality of capitalism. It is worth a listen as well as a classroom lesson.
The lyrics relay the perspective of a laborer. As he sees a video of rock musicians on MTV, he expresses envy. He strains in the delivery of appliances while the musicians enjoy great wealth and adoration with little hardship:
We got to install microwave ovens, custom kitchen deliveries
We got to move these refrigerators, we gotta move these color TVs
Now that ain’t workin’, that’s the way you do it
You play the guitar on the MTV
That ain’t workin’, that’s the way you do it
Money for nothin’ and your chicks for free
As the song proceeds, the envy gives way to anger and resentment. There is injustice—even absurdity—in how wealth is distributed! An honest day’s work should be more valued!
This is the stuff of protest songs against capitalism. Nonetheless, “Money for Nothing” turns out to be no such thing.
A Familiar Premise
The laborer’s anger is based on an important premise, and the song helps us reflect on this premise’s merit. Economists have a name for it: the labor theory of value.
In the simplest terms, a laborer’s toil and time are, in this view, that which give a product or service its value. More of each means more value. The laborer in the song naturally wants his tiring inputs to be dignified and appropriately rewarded.
There is something compelling about this logic. It tells us in our guts that teachers, frontline workers, and military—those who give blood, sweat, and tears to the job—deserve more. It generates the instinctual suspicion of CEOs, athletes, and stars lounging on their yachts on a random workday.
Recently, toil and time have been more conspicuously calculated in moral discourse. Lead female actors—putting in the same hours furrowing their brow—would deserve the same pay as their male costars. Likewise, the US women’s national soccer team, spending the same hours kicking the same spherical object as the men, would deserve equal pay. (And…breaking news…they have been given it!)
Still, the primary songwriter, Mark Knopfler, had no sympathy for his protagonist’s sense of injustice. He had merely transcribed a colorful conversation he had overheard. And, upon closer inspection, the song reveals three excellent reasons to dismiss his protagonist and the labor theory of value.
The Market Discovers and Provides
The first reason can be elicited from Sting’s small but iconic lyrical contribution, “I want my MTV.” The video clarifies that this sole sentiment of appreciation comes from a second laborer. For him, value does not derive from toil and time. It derives perhaps from…expertise, quality, ingenuity, and a heavy dose of je ne sais quoi.
In the music scene since the 70s, Knopfler and Sting likely knew in their bones that value does not begin and end with toil and time. Value snakes its way like a pachinko ball through the countless excellent human qualities to find its end.
Economists know this too. The discipline abandoned the sterile labor theory during the marginal revolution in the 19th century. In recognition of the incalculable diversity of human preferences and human qualities, value may better be understood as simply subjective. The customer will value what the customer will value.
The subjective theory of value opens our eyes to the adjectives all around us, offering a credible explanation for unequal outcomes. Because of consumer proclivities, it is an expert worker who tends to earn more than a careless one, an innovative entrepreneur more than a feckless one. Similarly, it is an established and beloved male actor who tends to earn more than an untested and unknown female actor. (Seasoned female stars do just fine, on the other hand.)
And, yes, while the men’s soccer team may often be mediocre and the women’s regularly superb, the men play for a voracious foreign audience, and the women—despite their support at home—play for a dispassionate one. Que sera, sera.
These are intelligible outcomes. Importantly, they are also moral ones. Adam Smith helped society see this unintuitive kind of morality, but it is once again largely absent from our academic and spiritual teachings.
It is a morality which occurs in synchronous systems. Great things happen, it turns out, when prices may rise and fall in response to what customers value, need, desire, and hope for. Seemingly magically, the unmolested market attracts providers of such things! The invisible hand of the market predictably yields this new kind of alms.
The alternative is not nearly as beneficent. If we allow government to steer prices with subsidies, privileges, or tariffs, we put the chaff back into wheat. We get our neighbor’s hard-working-but-off-key garage band on tour instead of U2, British wine instead of French, and the Ford Edsel Way instead of the Toyota Way.
The Market Enriches
The market does not just provide things, it improves them. This second reason to support natural markets is apparent in what the laborer is delivering. Consider microwave ovens and color TVs.
Believe it or not, these were luxuries back then. Only a quarter of Americans had microwaves in 1985, and for good reason. In today’s dollars, a microwave cost $1,600. As for color TVs, most American households (and 60 percent of Brits) would have had one—but likely just one. And the cost? A small TV would have run $1,800 in today’s dollar; a weakly projected large screen, a whopping $3,600!
Today’s ubiquity, cheapness, and superior quality of these technologies are not an accident. People have a proclivity for better quality of life. While quality of life is an utterly mysterious and idiosyncratic thing for each of us, rising and falling prices reveal to producers these inner calculations of the soul. Prices beckon: Improve this great thing; dispense with that horrible one! Dreams and nightmares are writ large in market prices.
In the song, the laborer is literally weighed down delivering the luxuries the musicians enjoy. But the laborer’s own luxuries are already en route by way of someone else’s entrepreneurial spirit. The laborer’s desires call forth improvements like cleaving Athena from the head of Zeus. In time—and it does take time—this lowly laborer will enjoy more riches than even Rockefeller could have imagined.
The Market Improves Character
The most controversial attribute of the song—which led to its eventual banning in Canada three decades later—brings us to the final reason to reject the labor theory of value. The laborer turns ugly, engaging in a homophobic, misogynistic, and racist rant toward the musicians:
See the little f**got with the earing and the make up
Yeah, buddy, that’s his own hair
That little f**got got his own jet airplane
That little f**got is a millionaire
Look at that mama, she got it stickin’ in the camera man
We could have some
And he’s up there, what’s that?
Bangin’ on the bongos like a chimpanzee
This ugliness happens to be a feature of the labor theory of value. To hold onto toil and time as a moral guide is to reject the value of diversity—one which inevitably will contribute at times through levity and brevity. The labor theory of value is a monolithic value scheme, and it rouses when otherness is rewarded.
A market based on subjective valuation encourages remarkably different features. Montesquieu saw one in what he called “doux commerce.” People would temper their passions, biases, and enthusiasms to not be excluded from the opportunity of exchanging with others. People would accept diversity—perhaps pragmatically at first, but then as a function of a new moral sensibility.
Today, the evidence is compelling. We witness that countries with freer markets are more trusting, cooperative, accepting, and democratic. They are also more appreciative of women—even if their people have been slow to show interest in women excellently kicking a ball for entertainment.
The Choice We Face
“Money for Nothing” is the dream of every generation. For society as a whole, there are two ways to get it. The first way is theft on a national scale. That means the extraction of goods and services from neighboring lands through warfare (i.e., pillaging and enslavement). The second way is through a set of property rights which aids the exchange of values and which permits innovation to flourish.
For 99.9 percent of human existence, we have chosen extraction. More recently, the right liberal attitudes toward commerce and diversity have won favor enough to inform our institutions.
While we still remain uneasy about the free-wheeling quality of markets, I think we can all agree that exchange is better than the old way to get “money for nothing and your chicks for free.”
Content syndicated from Fee.org (FEE) under Creative Commons license.
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