All wealth begins with labor. Gold, silver, and even diamonds are accepted from the earth, but the acquisition begins with a shovel. All wealth begins with labor! Power comes from wealth, but even power requires labor to set it in motion. Labor starts it all. If you think wealth is something you can inherit without working; you'll lose it even if you get it. It takes labor to keep wealth.
If you think wealth can be borrowed to purchase the labor of others, then you may miss the labor required to learn all the things the capitalist needs to know in order to employ labor in a profitable manner. If you skip this requirement, long term debt and poverty will likely be yours before licenses.
Just like real estate, the value of labor is all about location, location, location. The same labor of a fisherman may catch a boatload or nothing at all, depending upon the waters being fished. A shovel load of dirt from one spot on the beach might produce nothing but sand, while the next shovel might exceed a rare sea shell. On the beaches of Alaska, one man found a gold nugget weighing in at 186 Troy ounces, but without weight of his foot upon the shovel, that gold would never have been found.
The skill of labor is knowing where, when, and how to apply it. The one thing Adam Smith and Karl Marx would both agree on is that labor is the source of all wealth. All wealth springs from labor.
The labor theory of value probably first appeared in the writings of John Locke, the English philosopher during the 1600's. Locke acknowledged that resources occurring in nature, provided by God (placed by the labor of God) as common property for all. He argued that when a man took things from nature and reshaped them into products useful to humans, the mixture of labor with raw materials produces a product. Locke believed the products become an extension of the worker. He believed this extension to the person justifies the right to personal ownership of property. This became the cornerstone of capitalism.
Locke hinted that human labor is the unique factor that creates value in commodities, and that the value of any product is approximately equal to the amount of labor necessary to produce it. Labor today is more efficient than it was in Locke's day, and raw materials are more or less redundant depending upon the resource and the technology needed to unearth it. Today, the value of a commodity would have related to the labor required to replicate the commodity.
So a commodity more rare today would be worth what labor it takes to produce it under today's circumstance while less rare items would be relative to today's labor required.
Some modern economists deny the labor element to value, but they do it out of a desire to disagree with Karl Marx more than a clear understanding of labor. Some like to distinguish between labor and capital, but without labor capital is idle. Labor moves capital from a place where it can not be used to a place where it can be use. Labor pulls the trigger that sets capital in motion. Capital is, more times than not, the unconsumed savings of labor.
I've heard people say it was impossible to make a fortune working, but the people that talk this way never achieve the wealth they covet. Wealth can not be removed from the labor it takes to get it. Some labor is more productive than other labor. Everyone who ever earned a blister from hard work knows this. Labor can be intelligent or mindless. Everyone who ever put on a glove to prevent a blister knows this.
Adam Smith explained how labor is divided. He used a group of hunters as an example. A band of men can hunt large food animals more efficiently than a single person. It must have been obvious to these bands that some were better at making bows than using them, and some better at making points than shooting them. So it was that labor was divided, with those who make good points spending more time making the points while those better at shooting used the bows.
Smith explains that a single man might fashion two or three nails per day, but a small team of skilled men whose labor is divided properly may make thousands of nails per day. A person set on acquiring wealth today would do well to understand the nature of labor and its importance in the production of wealth. He should at once embrace the labor needed to acquire wealth and at the same time begin a study on how best to apply labor. The capitalist needs to know when, how and where to apply labor for the best results.
Additionally, the capitalist needs to know how to divide labor in the manner in which it returns the greatest reward.
The would-be capitalist without capital will need to expend whatever labor is necessary to accumulate savings sufficient to hire the labor of others more efficient than himself in such a way as to produce the wealth he desires. While spending his own labor, care should be taken that he observes efficiency and inefficiency. When he has savings enough to hire others, he might then purchase and apply the others labor more efficiently that the laborer would have done by him.
The application of another's labor is just another division of labor. It is still labor, even if it comes with the promise to gain more. It also comes with the risk of losing more. Once the inevitability of labor is recognized and appreciated in the process of wealth production, the next lesson to consider is how to transform labor into wealth.