Business ownership: legalized theft?

A question from Yahoo! Answers:

Is this point rocksolid? [profits minus ownerfairpay = legal theft or beggary]?

if we understand or define costs as including fairpay for the workinput of owners, as well as employee costs, overheads, advertising, accounting, costs of materials [which are ultimately labour costs] etc, then profits BY DEFINITION have to be money for no work = injustice [legal theft or beggary] = overpay, causing wealth concentration, causing tyranny, ie, the destruction of democracy?
is it rocksolid that there is nothing to limit profits to fair return to owners? – ie, that, after they have been paid fair returns for their labour, there is nothing stopping returns to go in excess of this, which by definition are money for no work?
profits can be for reasons of scarcity, monopoly, etc which are clearly not money for work, & therefore must cause work for no money [= underpay, wageslavery, slavery, evergrowing injustice, causing evergrowing violence [= misery], necessarily escalative to extinction [selfmurder of 6-7 billion]
it is IMPOSSIBLE for there to be doubt of this – yes?

There is nothing about this point that is rock-solid. What exactly is the “owner’s fair pay”? Who is to decide if the pay is fair? Using which valuation method: valuation by multiples, valuation by discounted cash flows, real-option valuation, something else?

What you seem to be ignoring is the concept of risk; business owners are compensated primarily for risks they take by investing their time and money into their business rather than having a job and investing in mutual funds held in tax-shielded retirement plans.

As to the causes of “evergrowing” violence, you are repeating political scientisis’ claims that have no basis in reality (if for no other reason, then because violence has greatly subsided since the end of the Cold War). Read “Economic Causes of Civil War and Their Implications for Policy” by Paul Collier:…

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