The labor theory of value (LTV) is commonly associated with Marxism, though versions of it go back to at least Thomas Aquinas in the 13th century. Marx actually never used the phrase “labor theory of value,” writing only of a “law of value” and socially necessary labor time. The Marxist LTV can be summarized as: Economic value is (or perhaps, should be) defined as the fraction of society's output of socially necessary labor time (as in the proportion of all labor produced by whatever you consider to be your economy). To contrast, liberals typically believe in subjective value, that economic value is defined in terms of utility to the buyer.
Labor theory of value is a far more progressive and humanistic conception of value: Rather than the hedonistic subjective theory, which treats pleasure as inherently valuable, the labor theory treats human effort as inherently valuable. We use money to mobilize people into laboring; we should base price on the amount of labor that went into the item, not based on the willingness of the buyer to pay for their hedonic pleasure. The latter allows the capitalist to thrive. It turns an equal exchange of labor into an unequal exchange of hedonic pleasure.
However, the labor theory of value also has some major problems. First, “labor” is very hard to define and even harder to quantify:
Marx split labor into the categories of productive and unproductive in order to make a number of other arguments in Kapital. I won't get into how it relates to other parts of Marxism, because I'm not a Marxist, and there are plenty of works by other people who understand and can explain it a lot better than me. It's enough for us to understand that there is no rigorous definition of productive and unproductive labor; it's essentially a judgement call on the part of the observer to differentiate productive from unproductive labor.
We can't observe or measure “labor”, not only because “labor” is now split into two categories, but because it simply is not quantitatively measurable. What unit corresponds to labor? How much exactly is one labor? How much of labor is it? We not only have to measure how many labors each person is engaging in, but also the total number of labors that all of society puts out in order to determine the fraction of total labor each person is contributing.
Marxist economists use prices as a proxy for labor. However, there are many ways that a price makes for a poor tool to measure labor:
- Economic activity takes place within a bureaucratic state formed by a national government and other capitalist organizations. Industry therefore has increased costs in order to comply with arbitrary and often unreasonable demands by the state.
- There are also direct costs to the capitalist state, such as taxes, fees, fines, and so forth, that contribute to costs above simply labor.
- Workers are paid wages that vary conflictually, according to the political power of the workers against the employer. The cost of labor, therefore, doesn't vary only according to productivity.
- The capitalist takes a profit over the cost of whatever activity they derive revenue from. The margin of profit again varies conflictually according to the political power of the buyers versus the capitalist.
- Human activity nearly always has some material cost as well as having a labor cost.
- Wages do not distinguish between productive and unproductive labor, and wages are the basis of labor cost.
- We could treat these additional costs as really being labor costs embodied in a commodity to erase the differences in costs. However, these embodiments of labor also have all of the above problems.
Price as a measure of labor makes for a very poor tool. Broadly, many of the criticisms I've listed here belong to a known critique called the “transformation problem”. While it's usually treated as a problem of transforming labor quantities into prices and back, the real problem is attempting to use a theory of value to explain a price. Prices are not measures of value, they are measures of all of those things I listed above. Attempting to explain a price with a theory of value is as nonsensical as attempting to explain an IQ with a theory of mind.
While the idea of a quantity called “labor” is untenable, I don't think we should throw out LTV entirely. In it lies an excellent progressive ideal: Human effort is valuable. Some Marxists flip the term to become “value theory of labor” in order to emphasize this. I prefer to generalize this: Human agency should come above hedonic pleasure in determining how we shape our world.
Time banking is a related concept to LTV. Rather than trying to quantify “labor”, time banks simply use hours. Under the LTV, one worker's hour may represent a different amount of labor than another worker's hour. Time banking is even more egalitarian: One hour is equal to another hour. Whereas exchange in dollars or labor vouchers privileges some over others, in timebanking everyone is equal. This also means that time banking does not have any of the peculiarities of labor units, and has an actual unit of measure.
TimeRepublik is currently the largest international time bank. It is built as a website which allows users to exchange services for timecoins, and one timecoin is one hour of someone else's time. Since it's just a single website, TimeRepublik is a very centralized system, and all users must operate within this system. Timecoins cannot be used outside of the web application (contrast with Bitcoin which is designed more like a distributed protocol). While the service itself is highly centralized, TimeRepublik's economy is decentralized to the highest degree possible: There are currently no functional businesses in TimeRepublik, exchange is between individual users only. It also only allows the exchange of services: Goods cannot be exchanged, and materials required to perform a service need to be paid for outside of TimeRepublik.
Time banking is very simple to understand, very egalitarian, and difficult to exploit. However, it is still based on exchange, entitlements over others' time, and is not easily compatible with goods production. Like other alternative economies, it has the task of building whole supply chains and achieving a sufficient ecosystem of goods and services to separate from the capitalist economy. If time banking became sufficiently important without being sufficiently closed off from the capitalist economy, it's likely that it would be capitalized on and thus exploited for benefit and/or sabotaged.
I think we should follow time banking to its logical conclusion, and embrace the philosophy of temporalism. Temporalism begins with the time theory of value—not as an explanation for prices, but as an explanation for why & how time is valuable.
The most uncontroversial part of this time theory of value (TTV) is that time has value. It's self-evident that time has value. Time, for us, is the scarcest resource. We all need and want as much time as we can get. We can't create or discover more time (not yet, anyway). Time passes invariably and irreversibly, so we either use it or lose it. We can also observe that time is important to us from our actions: We expend immense quantities of resources in order to save time; We will often place our value of time over other ethical values, for example by opting for convenience over environmental safety; We very reasonably choose to spend most or all of our money to enjoy our time now, rather than soberly saving it for an unlikely way to achieve more time and enjoyment in the far future.
Time can be free or unfree. Unfree time can be better referred to as obligatory time. The difference is simple: free time is time we are free to spend any way we like, while obligatory time is time we spend on necessities, duties, or under coercion. Free time is self-evidently preferable to obligatory time.
Time can be personal or social. These are not necessarily exclusive categories; we can work to achieve personal and social goals simultaneously. Social time is, broadly, the category of time spent on social activity or towards social goals. This includes the much narrower (and highly criticized) Marxist category of “production”, social time spent on producing goods or services. Personal time, on the other hand, is the category of time spent on personal interests or towards personal goals or fulfillment.
Any activity that a human society wishes to partake in requires some sort of human effort, and therefore time. This time must come from the portion not reserved for personal obligations. Reducing the time needed to fulfill personal obligations increases the time available for all other activity. The remaining time is divided into free time and social obligatory time. Most, if not all, other activities require materials and energy, as well. Both require time to be made available for use. We can use this fact to analyze any human activity completely in terms of time.
There is a pretty rigid limit on the amount of effort that may be put forth by humans in a given week, and therefore on what we can accomplish and how fast. We can roughly calculate it with relatively few facts:
On a weekly basis, each person has 168 hours of time to allocate. Realistically, we need at least 77 hours per week (8 hours for sleeping, 3 hours for miscellaneous) to fulfill physiological obligations. We could probably imagine a more Spartan lifestyle that takes up less personal time, but 11 hours a day of personal time seems a fairly reasonable figure to achieve basic comfort. Taking this figure and multiplying by the entire human population, that means about 600 billion hours per week is available for social activity.
It's pretty doubtful that we will achieve anywhere near 100% utilization of that time, of course. Even in the modern workplace, a really good utilization rate is about 80%, and that's for the conscripted time of able-bodied, working adults. First, the labor force (working-age adults) is only about 60% of the population. That brings the total hours down to about 360 billion. Not all working-age adults actually work, so given a labor force participation rate of 60%, we can cut the available hours down to about 215Bn. A realistic, decent utilization rate would be under 60%, giving us around 130Bn hours.
This is the (fairly optimistic) absolute limit on what we can accomplish in a given week, if all time not spent on personal obligation were spent on social goals. To compare this to a distinctive project we are all familiar with, the Apollo space program is estimated to have cost about 131Bn man-hours. In other words, every week we have the power to change the world as much as one Apollo program. Today we use this power to build a megamachine of wealth accumulation for a handful of blue bloods.
We may consider the possibility of increasing this figure through automation. Automated equipment is not as infinitely variable as humans, requiring programming and physical design for a certain task. Automation can essentially transform a small amount of time performing a single design task into a much larger amount of time performing a repeated physical or intellectual task. Mechanization fulfills a similar role but generally requires a greater degree of additional human management compared to a computerized solution. Automation can add an indefinite number of hours to human social time, but it does require some amount of active commitment, however small.
The Value of Time
We can begin asking more interesting questions about time. First of all, does all time have equal value? It's pretty intuitive that free time is more valuable to us than time spent on obligations. We would like to spend our scarce time on what we like, rather than what we must. We would like to have the most free time possible, and the least obligatory time possible. However, by merely doing whatever we want, without intentionally cooperating with others and without organizing that cooperation, we are not achieving the highest possible free time. A solitary person is nearly helpless compared to the natural world, and that is even more true in the human world. Humans work together to achieve results greater than the sum of their parts.
Economists have written favorably about “the division of labor,” but they generally treat it as universally liberatory. Division of labor is simply the way that time is freed for other activities. The economists cannot conceive of a division of labor that results in less free time overall. However, were we to honestly examine the division of labor, it would be hard to conclude that it has increased free time. Today we have less leisure time than we did in the mid-20th century. While automation is happening, the division of labor has simply changed to put more people into bureaucratic roles. Our free time is being eroded by the forces of inflation, stagnation, and debt. While we have numerous technologies that can liberate us from toil, they are used for exactly the opposite purpose, for the wealthy to further colonize our time and force us into other forms of toil.
It's not only technology that colonizes our time; capitalism has numerous “spooks,” as Stirner would put it—ideas that restrict our freedom—such as debt, the nation-state, and so on. These things are mere constructions of human thought, yet they are treated as real and allowed to oppress us, materially, psychologically, and temporally. The ability to think temporally and value our own time is at the root of freeing our time. When we think of the division of labor temporally, we can understand where the liberatory potential of dividing up labor lies.
We can divide labor in ways that have more or fewer desirable roles and more or fewer undesirable roles. If there are more desirable roles, then there is a greater likelihood that a person will consider time spent in that role to be free. If there are more undesirable roles, then there is a greater likelihood that a person will consider time spent in that role to be obligatory. Therefore, by dividing up labor in a way that has as many desirable roles as possible and as few undesirable roles as possible, we increase overall free time.
We can divide labor into roles that oblige more or less time from the performer, and free more or less time for others. We want our roles to oblige as little as possible while freeing as much as possible. By creating roles that are highly effective at liberating time, each of us has more free time to spend.
Our obligatory time can be personal or social. Preparing food and sleeping is personal obligatory time. Making products or raising children is social obligatory time. Wage labor is, in one sense, obligatory, in that you are performing some service for another person; but in another sense, it is personal, since it is done simply so that the laborer can acquire the means to survive. The need to earn income causes personal obligatory time to be somewhat social. However, reductions in the need for wage laborers' time, such as through mechanization and automation, are perverse under capitalism: Rather than leading to an increase in free time, they undermine the power of labor, leading to falling wages and therefore a decrease in free time.
This does not need to be the case. With a liberatory social order, a reduction in the need for laborers' obligatory time would lead to an actual reduction in laborers' obligatory time. What we need is a system of social obligation that is focused intensely on creating free time for all, rather than giving control over the obligatory time of the many to the few. If we make a social agreement to spend some of our time on social obligations, we can free time for others far in excess of the obligatory time each of us has to spend. We would benefit as well, by our personal obligations being taken care of by others' social obligations.
Time can be more or less free. If we have many possible ways to spend our time, then our free time is more free; if we have few possible ways to spend it, it is less free. The “many worlds” theory of time is one expression of this fact. On one end, there is the single possible timeline possibility, where everything is essentially predetermined. On the opposite end, there is the infinite diverging timelines possibility, where everything that can possibly happen does. Each of us is following a path through time which can be closer to one end or the other on the spectrum.
Our modern society is quite stratified in terms of the amount of free time we have, but this is really, at most, about a hundredfold difference (in weekly terms). What is by far more stratified is the degree of freedom that people have in their free time. People who are especially poor have access to little or nothing to do during their free time; people who are poor in rich countries might have TV and alcohol; people who are wealthier might have a few toys; people who are truly wealthy have everything those below them have and more. Most people are closer to the single possible timeline, while a small handful are closer to the infinite diverging timelines, following their preferred path through it.
Technology, when it is available to us, adds degrees of freedom to our free time. However, poor use of technology can also destroy degrees of freedom. It can destroy forests that people hike in or beaches that people relax on. Social organization can add free time as well as adding degrees of freedom to it. Likewise, poor social organization can remove free time or degrees of freedom. We live in a highly authoritarian, stratified, scarcity-based society. The amount and degree of free time we have is aggressively restricted for most of us. However, we consciously accept this, because it has been normalized and legitimized to us.
Let's examine one of the basic assumptions of our modern society: A doctor is worth more than a clothes cleaner. Is a doctor inherently more worthwhile than a clothes cleaner? Using a temporalist analysis, we would say, “is a doctor's time inherently more valuable than a clothes cleaner's?” To anyone raised capitalist, the answer is so obvious it seems like a silly question; of course a doctor is more valuable than a cleaner, doctors save lives while clothes cleaners just clean clothes. However, it's not always true that doctors save lives, many just generally keep us healthy, eating well, prevent dental or genital problems, or make us look aesthetically-pleasing. On the other hand, EMTs also save lives, but no one seems to be advocating they be placed in equal regard to doctors of any sort.
Either way, let's step away from an emotionally-loaded term like “saving lives” and look at it temporally: Doctors increase the time we have available. Whether it's by actually saving our lives, curing our illnesses, or by just making us healthier in general, the actual effect is that doctors give us more time. When it's put this way, doctors seem less uniquely vital and worthy of exalted status. And, to be perfectly fair, clothes cleaners do exactly the same thing: They give us more free time, by taking on a social obligation to free us from personal obligations. Does a clothes cleaner give us as much free time as a doctor does? Probably not, but who has ever even tried to make that calculation? The higher value of doctors is simply assumed to be true, because it's not easy to become a doctor and because we look at the situation with emotionally-loaded ideas.
Let's concede that a doctor will probably free more time than a clothes cleaner will. Does that mean doctors must be exalted to a superior social status, being paid vastly more than the clothes cleaner? Let's rephrase that: Is every moment of a doctor's time more valuable than every moment of a clothes cleaner's time? Is the time a doctor spends eating lunch more valuable than the time a clothes cleaner spends eating lunch? If, through the use of technology, a doctor is able to free even more time for others, does that mean that the doctor's time has become more valuable? It seems to me that the answer to both is no. Time spent eating lunch is personal obligatory time and not particularly valuable, whether it's a doctor or a clothes cleaner doing it. A doctor's time does not become more valuable when a new machine increases the doctor's efficacy.
What problems have we uncovered, here? First is the problem with considering individuals in terms of their role in society: A person can be a doctor, but that person is not always a doctor. We can define “doctor” only in social terms, because it's a social role. When we speak of the value of doctors, we are not speaking of the value of individuals who are doctors, but of the role of doctor. A doctor who doesn't really help anyone is not inherently more valuable than a clothes cleaner who helps a lot of people. It is the action of practicing medicine, of fulfilling the role of doctor, that is valuable. Likewise, if a clothes cleaner is not valuable, then it's the role of clothes cleaner that is unvaluable, not the person who is the clothes cleaner.
What do we really mean when we ask if a doctor is more valuable than a clothes cleaner? Today, what we really mean is, “should a doctor be given more freedom than a clothes cleaner?” We are looking for a legitimization of the doctor's higher status in society. First of all, note that the way we do this is through force: Doctors use the leverage of their important role to charge more money, and with that additional money they can use economic force to mobilize people in their service. If it's truly self-evident that doctors are more important and it's natural that we give more important people a permanently high social status, then what need is there to formally enforce such a status? If it needs to be enforced, then it's not a fact, but a norm. Norms can change, and this one should.
Until we live in the fully automated luxury communist utopia, we will have some social obligations. Communities inevitably have to make membership and inclusion in the community contingent on some social obligations. Today we need to earn money to pay our way through society; a post-capitalist community will need to have some sort of social obligations, as well. Whereas today our obligations are extremely hierarchical, it's possible to make them non-hierarchical. One conception of this is mutualism, which has a long tradition in anarchist thought.
Temporal obligation is a different way to conceive of non-hierarchical community obligation. A community would decide what social activities it considers necessary. It would take the work needed to perform those activities, as well as the work needed to fulfill the personal needs of the community. The number of hours needed to complete these activities would be estimated and divided evenly amongst the working population. Each person would then have a duty to spend that many hours contributing to those necessary social activities.
This is distinct from time banking in that it is not an exchange program. Working X hours does not entitle you to X hours of someone else's time. It is simply a condition of membership to a community. If the estimate is off, or if technology or process changes reduce the number of hours needed to perform the same activities, the required hours of service can be adjusted. Thus, rather than automation limiting the power to earn a wage (as in capitalism) or reducing the time earned for exchange (as in time banking), it reduces obligatory time and gives us more free time. If work can be made more enjoyable, then more people will spend their free time working, and thus reduce the obligatory time required of everyone.
Dividualism and Utopian Temporalism: Practical and Idealistic
Systems of privilege have brought ruin time and again throughout history. For every enlightened person of high status, there is a thousand ignorant & unscrupulous ones, and a million people of low status. In our system, this means billions live in destitute poverty, while thousands live in unimaginable wealth and privilege beyond the wildest dreams of any ordinary person. In human societies, it means resistance from those who are low status, much of which is today called “crime” and “terrorism”. While we normally think of these activities when we think “violence,” they are almost always reactions to violence or coercion. We waste incredible amounts of time on attacking these reactionary forms of resistance, when, really, it would be far less of a loss to change the institutions that are being so heavily resisted.
If eliminating most violent crime and terrorism is not worth the cost of having equal status to a clothes cleaner, then it's clear that those who claim to be interested in eliminating crime would rather maintain a system of superiors and inferiors than to actually eliminate crime. There are other stated concerns which some have than simply the direct loss of status. For example, the idea that we need some people to receive additional privileges to “incentivize” them to work; here it is presumed that the reward of privilege is what guides human behavior, and that those who are in high-status positions are there because they are needed for some higher purpose.
The amount and degree of temporal freedom we have should not be distributed according to systems of privilege. We should not structure society as a Skinner box, handing out rewards of privilege for performing certain tasks. Post-scarcity has been possible for half a century, and in today's world, most scarcity is artificial. Incentivization in such a state is particularly authoritarian. Whereas long ago, scarcity was to a large degree natural and there was a forceful distribution of luxuries to the upper class, today we use rationing to enforce destitution in the lower class. This is so we can “incentivize” people using rewards that are (in reality) plentiful for all, in order to coerce them into fulfilling certain roles.
We should instead structure society so that the process or intrinsic result of performing tasks is the reward, so we don't need to incentivize anyone into performing them. When the near-inevitability is on the horizon of full technological unemployment, we shouldn't need to incentivize people into doing anything. If no one wants to clean clothes, then we should automate clothes cleaning. If it's not possible to automate clothes cleaning, then we can try to make it a socially obligatory role, or eliminate the role of clothes cleaner and absorb the task of cleaning clothes into our personal obligatory time.
We should see doctors as dividual (see “On Dividualism,” Vol. 1), relational roles that some people choose to play for a portion of their time, rather than individual, permanent identities. Medical care is important, but so is cleaning, so is farming, so is construction, yet we scarcely ever question why these roles fit into our system of privilege the way they do, and whether we should do this in the first place.
A utopian social system must learn to differentiate between a person and a role. Dr. Maheswaran is a person, while doctor is a role. If we were to really run the numbers on the amount of time freed by a doctor compared to a clothes-cleaner, we very well might find that a doctor frees more time than a clothes cleaner. However, this doesn't mean that Dr. Maheswaran is more valuable, but rather that a doctor is a more valuable role. Thus, we would want to encourage more people to take on that role: not by giving doctors command over the social obligatory time of society's peons; instead, by making the role of doctor more accessible to anyone who wants to partake in it, by making it more enjoyable, more fulfilling, more of an activity that people would want to do in their free time.
While time banking could eventually be used to price goods based on the number of hours it took to realize them, this figure will not account for the non-human processes that went into them. Because it's based in exchange, only the time of humans and human organizations can be meaningfully and effectively considered. While this is a great idea for egalitarian exchange, it doesn't bode well for sustainability. A complete lack of accounting for ecology is very unlikely to magically turn out okay. The only way we could be sure to fix it would be, in classic tactic, to add a second system on top which establishes a different, conflictual logic to add the goal of sustainability.
Temporalism, by contrast, can be used to establish a system of accounting that both treats all human time as equal while also including sustainability and non-human labor as integral parts. This is done by taking the concept of replenishment rate, the rate at which resources regenerate themselves or are otherwise made available for human use, and inverting it. Rather than budgeting based primarily on money stocks, material stocks, or energy stocks, we budget based on temporal flows.
If sustainability is defined as not spending more than you earn, then a sustainable budget is simply one where the limit to spending is earnings. During the period of a budget, there will be a certain amount of available energy, materials, and human time generated or made available. For that given period, an amount of energy, materials, or human time can be considered in proportion to the total time the period spans. Each joule of energy, liter of water, and kilogram of material, therefore, has some cost in time, representing the duration of time needed to make it available.
There are a lot of important details that can be discussed about this system, but this may be too large a topic to get deep into here. I will note that an important characteristic of this is its ability to serve as a common basis of comparison between heterogeneous, complex products: Both their inputs and outputs can be compared in terms of time. Since all of us want time, this is not only an empirical and realistic basis of comparison, but also one that analyzes a quantity that is inherently valuable to us all. It's also one that's very intuitive and simple for anyone to understand without any special education. Everyone is familiar with how long a day is, and that cost is meaningfully comparable to the human experience.
In recent decades, we have lost sight of genuine human ambition. With the defeat of the labor movement, the fall of the USSR, and the gradual destruction of Western science by neoliberalism & anti-intellectualism, our dreams have fallen from the stars and landed in a shopping mall. Space exploration is a traditional human ideal stretching back millennia, yet today the only reason our new private space programs have for existing is to exploit space for private wealth. Utopianism is dismissed as naïve idealism, rather than a long-term ambition for humanity to reach for. The height of human ambition is navel-gazing individualist tech such as virtual reality and transhumanism.
Temporalism should be at the heart of a resurgent utopianism. A temporalist society would seek to make space travel one of the degrees of freedom available to every human who wants to partake in it. A temporalist society would seek to free all human time, to make space and other human horizons freely-available to all, and to make the infinitely-diverging timelines state of freedom a reality for all people. A temporalist society would seek to eliminate aging, and therefore to make time a completely abundant resource, for all people. We should not only not give in to despair, we should set our expectations even higher: The world of tomorrow will not be a fascist whitelash, or a liberal compromise, or a primitivist genocide, it will be fully-automated immortal libertine temporalist playtime.