Rush! Make the Complex Understandable!

Yesterday a listener called Rush Limbaugh and riffed on the Elizabeth Warren flap.  The hypothetical business owner she cited, benefiting from the taxes and police and fire and roads, wasn't just benefiting from the government.  He was benefiting from the labor of the workers he hired.  Said Jeff the caller:

He didn't get rich because he dug more ditches than anyone else. He got rich and most people in the country get rich because they've got other people working for them, which means they're selling the labor of these other people for more than they're paying for it. They're paying a guy $8 to dig a ditch, and they're charging somebody else $20 for that ditch. Abraham Lincoln said that "before there's capital there's labor, and all capital comes from work that real human beings do."

This line, Rush was quick to tell his listeners, comes from the Daily Kos, in a January 29, 2009 article, "Abe Lincoln: Pro Labor. Send THIS to your R friends.", boosting the famous stimulus of that winter.  The "THIS" in question is an image and a quote from President Lincoln, here, made in his first message to Congress in 1861:

"Labor is prior to, and independent of, capital. Capital is only the fruit of labor, and could never have existed if labor had not first existed. Labor is the superior of capital, and deserves much the higher consideration."

Rush responded, in due course, that this goes back to the idea that labor is paid less than it is worth.

This guy believes (I'll use myself here as an example) that I am getting rich -- and I'm not admitting that, by the way -- by paying the people who work for me less than what they are worth (not what they deserve, less than what they're worth) and getting rich off of it. Therefore, I am screwing the people who work for me.

Of course, the idea that it is scandalous that a contractor bills his client $20 for a employee that costs him $8 comes from Marx.  To justify the intervention of politics into the relation between worker and employer, Marx needs to find an injustice.  He finds it in the fact that the worker does not obtain the full value of his labor.  The employer gets more than he does by appropriating the surplus value of the worker's product over and above the value of the wages paid to the worker.

Help us out here Rush!  Let's come up with a rejoinder to these lefties and Marxists!  Let's make the complex understandable!

Here's my take.  It is true that "labor is prior to capital."  Of course it is.  That is why the capitalist must pay the  the worker his wages before he pays the bank. Before he pays his taxes. Before he gets paid by his client. Before he pays the bond-holders.  And before the chaps that come last of all, the shareholders, the risk-takers.  That is the principle of capitalism; it agrees with Abraham Lincoln.  The worker gets paid first.  The stockholders, accepting the risk proposition, come last; they live off the remainder left after all other stakeholders have been paid.  They make profits, or they suffer losses.

The welfare state is different.  In the welfare state the non-workers, from Social Security recipients to Medicare beneficiaries to welfare recipients to politicians to government workers, they all get paid first. And if there is enough money left over after all this government beneficiaries have been paid, then the workers can get paid.

In socialism, things are different.  There the workers do not come first.  They do not come last.  In socialism, the only thing that matters is the state.  So the workers do not really exist.  That is why they often just starve.