Chapter II: Money or Simple Circulation (7)

The indifference as to the particular kind of labor implies the existence of a highly developed aggregate of different species of concrete labor, none of which is any longer the predominant one. So do the most general abstractions commonly arise only where there is the highest concrete development, where one feature appears to be jointly possessed by many, and to be common to all. Then it can not be thought of any longer in one particular form. On the other hand, this abstraction of labor is but the result of a concrete aggregate of different kinds of labor. The indifference to the particular kind of labor corresponds to a form of society in which individuals pass with ease from one kind of work to another, which makes it immaterial to them what particular kind of work may fall to their share. Labor has become here, not only categorically but really, a means of creating wealth in general and is no longer grown together with the individual into one particular destination. This state of affairs has found its highest development in the most modern of bourgeois societies, the United States. It is only here that the abstraction of the category “labor,” “labor in general,” labor _sans phrase_, the starting point of modern political economy, becomes realized in practice. Thus, the simplest abstraction which modern political economy sets up as its starting point, and which expresses a relation dating back to antiquity and prevalent under all forms of society, appears in this abstraction truly realized only as a category of the most modern society. It might be said that what appears in the United States as an historical product,―viz. the indifference as to the particular kind of labor―appears among the Russians e. g. as a natural disposition. But it makes all the difference in the world whether barbarians have a natural predisposition which makes them applicable alike to everything, or whether civilized people apply themselves to everything. And, besides, this indifference of the Russians as to the kind of work they do, corresponds to their traditional practice of remaining in the rut of a quite definite occupation until they are thrown out of it by external influences.

This example of labor strikingly shows how even the most abstract categories, in spite of their applicability to all epochs―just because of their abstract character―are by the very definiteness of the abstraction a product of historical conditions as well, and are fully applicable only to and under those conditions.

The bourgeois society is the most highly developed and most highly differentiated historical organization of production. The categories which serve as the expression of its conditions and the comprehension of its own organization enable it at the same time to gain an insight into the organization and the conditions of production which had prevailed under all the past forms of society, on the ruins and constituent elements of which it has arisen, and of which it still drags along some unsurmounted remnants, while what had formerly been mere intimation has now developed to complete significance. The anatomy of the human being is the key to the anatomy of the ape. But the intimations of a higher animal in lower ones can be understood only if the animal of the higher order is already known. The bourgeois economy furnishes a key to ancient economy, etc. This is, however, by no means true of the method of those economists who blot out all historical differences and see the bourgeois form in all forms of society. One can understand the nature of tribute, tithes, etc., after one has learned the nature of rent. But they must not be considered identical.

Since, furthermore, bourgeois society is but a form resulting from the development of antagonistic elements, some relations belonging to earlier forms of society are frequently to be found in it but in a crippled state or as a travesty of their former self, as e. g. communal property. While it may be said, therefore, that the categories of bourgeois economy contain what is true of all other forms of society, the statement is to be taken _cum grano salis_. They may contain these in a developed, or crippled, or caricatured form, but always essentially different. The so-called historical development amounts in the last analysis to this, that the last form considers its predecessors as stages leading up to itself and perceives them always one-sidedly, since it is very seldom and only under certain conditions that it is capable of self-criticism; of course, we do not speak here of such historical periods which appear to their own contemporaries as periods of decay. The Christian religion became capable to assist us to an objective view of past mythologies as soon as it was ready for self-criticism to a certain extent, _dynamei_ so-to-say. In the same way bourgeois political economy first came to understand the feudal, the ancient, and the oriental societies as soon as the self-criticism of the bourgeois society had commenced. So far as bourgeois political economy has not gone into the mythology of purely (?) identifying the bourgeois system with the past, its criticism of the feudal system against which it still had to wage war resembled Christian criticism of the heathen religions or Protestant criticism of Catholicism.

In the study of economic categories, as in the case of every historical and social science, it must be borne in mind that as in reality so in our mind the subject, in this case modern bourgeois society, is given and that the categories are therefore but forms of expression, manifestations of existence, and frequently but one-sided aspects of this subject, this definite society; and that, therefore, the origin of [political economy] _as a science_ does not by any means date from the time to which it is referred _as such_. This is to be firmly held in mind because it has an immediate and important bearing on the matter of the subdivisions of the science.

For instance, nothing seems more natural than to start with rent, with landed property, since it is bound up with land, the source of all production and all existence, and with the first form of production in all more or less settled communities, viz. agriculture. But nothing would be more erroneous. Under all forms of society there is a certain industry which predominates over all the rest and whose condition therefore determines the rank and influence of all the rest.

It is the universal light with which all the other colors are tinged and are modified through its peculiarity. It is a special ether which determines the specific gravity of everything that appears in it.

Let us take for example pastoral nations (mere hunting and fishing tribes are not as yet at the point from which real development commences). They engage in a certain form of agriculture, sporadically. The nature of land-ownership is determined thereby. It is held in common and retains this form more or less according to the extent to which these nations hold on to traditions; such e. g. is land-ownership among the Slavs. Among nations whose agriculture is carried on by a settled population―the settled state constituting a great advance―where agriculture is the predominant industry, such as in ancient and feudal societies, even the manufacturing industry and its organization, as well as the forms of property which pertain to it, have more or less the characteristic features of the prevailing system of land ownership; [society] is then either entirely dependent upon agriculture, as in the case of ancient Rome, or, as in the middle ages, it imitates in its city relations the forms of organization prevailing in the country. Even capital, with the exception of pure money capital, has, in the form of the traditional working tool, the characteristics of land ownership in the Middle Ages.

The reverse is true of bourgeois society. Agriculture comes to be more and more merely a branch of industry and is completely dominated by capital. The same is true of rent. In all the forms of society in which land ownership is the prevalent form, the influence of the natural element is the predominant one. In those where capital predominates the prevailing element is the one historically created by society. Rent can not be understood without capital, nor can capital, without rent. Capital is the all dominating economic power of bourgeois society. It must form the starting point as well as the end and be developed before land-ownership is. After each has been considered separately, their mutual relation must be analyzed.

It would thus be impractical and wrong to arrange the economic categories in the order in which they were the determining factors in the course of history. Their order of sequence is rather determined by the relation which they bear to one another in modern bourgeois society, and which is the exact opposite of what seems to be their natural order or the order of their historical development. What we are interested in is not the place which economic relations occupy in the historical succession of different forms of society. Still less are we interested in the order of their succession “in idea” (_Proudhon_), which is but a hazy (?) conception of the course of history. We are interested in their organic connection within modern bourgeois society.

The sharp line of demarkation (abstract precision) which so clearly distinguished the trading nations of antiquity, such as the Phenicians and the Carthagenians, was due to that very predominance of agriculture. Capital as trading or money capital appears in that abstraction, where capital does not constitute as yet the predominating element of society. The Lombardians and the Jews occupied the same position among the agricultural nations of the middle ages.

As a further illustration of the fact that the same category plays different parts at different stages of society, we may mention the following: one of the latest forms of bourgeois society, viz. stock companies, appear also at its beginning in the form of the great chartered monopolistic trading companies. The conception of national wealth which is imperceptibly formed in the minds of the economists of the seventeenth century, and which partly continues to be entertained by those of the eighteenth century, is that wealth is produced solely for the state, but that the power of the latter is proportional to that wealth. It was as yet an unconsciously hypocritical way in which wealth announced itself and its own production as the aim of modern states considering the latter merely as a means to the production of wealth.

The order of treatment must manifestly be as follows: first, the general abstract definitions which are more or less applicable to all forms of society, but in the sense indicated above. Second, the categories which go to make up the inner organization of bourgeois society and constitute the foundations of the principal classes; capital, wage-labor, landed property; their mutual relations; city and country; the three great social classes, the exchange between them; circulation, credit (private). Third, the organization of bourgeois society in the form of a state, considered in relation to itself; the “unproductive” classes; taxes; public debts; public credit; population; colonies; emigration. Fourth, the international organization of production; international division of labor; international exchange; import and export; rate of exchange. Fifth, the world market and crises.

4. PRODUCTION, MEANS OF PRODUCTION, AND CONDITIONS OF PRODUCTION,
THE RELATIONS OF PRODUCTION AND DISTRIBUTION.[165] THE CONNECTION
BETWEEN FORM OF STATE AND PROPERTY ON THE ONE HAND AND RELATIONS
OF PRODUCTION AND DISTRIBUTION(1) ON THE OTHER. LEGAL RELATIONS.
FAMILY RELATIONS.

Notes on the points to be mentioned here and not to be omitted:[166]

1. _War_ attains complete development before peace; how certain economic phenomena, such as wage-labor, machinery, etc., are developed at an earlier date through war and in armies than within bourgeois society. The connection between productive force and the means of communication is made especially plain in the case of the army.

2. The relation between the idealistic and realistic methods of writing history; namely, the so-called history of civilization which is all a history of religion and states.

In this connection something may be said of the different methods hitherto employed in writing history. The so-called objective [method]. The subjective. (The moral and others). The philosophic.

3. _Secondary and tertiary._ Conditions of production which have been taken over or transplanted; in general, those that are not original. Here [is to be treated] the effect of international relations.

4. Objections to the materialistic character of this view. Its relation to naturalistic materialism.

5. The dialectics of the conceptions productive force (means of production) and relation of production, dialectics whose limits are to be determined and which does not do away with the concrete difference.

6. The unequal relation between the development of material production and art, for instance. In general, the conception of progress is not to be taken in the sense of the usual abstraction. In the case of art, etc., it is not so important and difficult to understand this disproportion as in that of practical social relations, e. g. the relation between education in the United States and Europe. The really difficult point, however, that is to be discussed here is that of the unequal (?) development of relations of production as legal relations. As, e. g., the connection between Roman civil law (this is less true of criminal and public law) and modern production.

7. This conception of development appears to imply necessity. On the other hand, justification of accident. Varia. (Freedom and other points). (The effect of means of communication). World history does not always appear in history as the result of world history.

8. The starting point [is to be found] in certain facts of nature embodied subjectively and objectively in clans, races, etc.

+4. Produktion, Produktions-mittel und Produktionsverhältnisse. Produktionsverhältnis und Verkehrsverhältnisse. Staats- und Eigenthumsformen im Verhältnis zu den Produktions- und Verkehrsverhältnissen. Rechtsverhältnisse. Familienverhältnisse.+

Notabene in bezug auf Punkte, die hier zu erwähnen und nicht vergessen werden dürfen:

‖1. Der =Krieg= ist früher ausgebildet, wie der Frieden: [Auszuführen wäre] die Art, wie durch den Krieg und in den Armeen etc. gewisse ökonomische Verhältnisse wie Lohnarbeit, Maschinerie etc. früher entwickelt [werden] als im Inneren der bürgerlichen Gesellschaft. Auch das Verhältnis von Produktivkraft und Verkehrsverhältnissen wird besonders anschaulich in der Armee.

2. Verhältnis der bisherigen idealen Geschichtsschreibung zur realen. Namentlich die sogenannte Kulturgeschichte, die alle Religions-und Staatengeschichte.

Bei der Gelegenheit kann auch etwas gesagt werden über die verschiedenen Arten der bisherigen Geschichtsschreibung. Sogenannte objektive. Subjektive. (Moralische und andere.) Philosophische.

3. =Sekundäres und Tertiäres.= Ueberhaupt =abgeleitete, übertragene,= nicht ursprüngliche Produktionsverhältnisse. Hier [ist das] Einspielen der internationalen Verhältnisse [zu behandeln].

4. Vorwürfe über Materialismus dieser Auffassung. Verhältnis zum naturalistischen Materialismus.

5. Dialektik der Begriffe Produktivkraft (Produktions-mittel) und Produktionsverhältnis, eine Dialektik, deren Grenzen zu bestimmen sind und den realen Unterschied nicht aufhebt.

6. Das unegale Verhältnis der Entwicklung der materiellen Produktion zum Beispiel zur künstlerischen. Ueberhaupt ist der Begriff des Fortschritts nicht in der gewöhnlichen Abstraktion zu fassen. Bei der Kunst etc. ist diese Disproportion noch nicht so wichtig und schwierig zu fassen als innerhalb praktisch-sozialer Verhältnisse selbst, zum Beispiel das Bildungsverhältnis der Vereinigten Staaten zu Europa. Der eigentlich schwierige Punkt, der hier zu erörtern ist aber der, wie die Produktionsverhältnisse als Rechtsverhältnisse in ungleiche (?) Entwicklung treten. Also zum Beispiel das Verhältnis des römischen Privatrechts (im Kriminalrecht und öffentlichen ist das wenige der Fall) zur modernen Produktion.

7. Diese Auffassung erscheint als nothwendige Entwicklung. Aber Berechtigung des Zufalls. Varia.[167] (Die Freiheit und anderes noch.) (Einwirkung der Kommunikationsmittel.) Weltgeschichte eigentlich[168] nicht immer in der Geschichte als weltgeschicht[liches] Resultat.

8. Der Ausgangspunkt [ist] natürlich von der Naturbestimmtheit [zu nehmen]; subjektiv und objektiv, Stämme, Rassen etc.‖

It is well known that certain periods of highest development of art stand in no direct connection with the general development of society, nor with the material basis and the skeleton structure of its organization. Witness the example of the Greeks as compared with the modern nations or even Shakespeare. As regards certain forms of art, as e. g. the epos, it is admitted that they can never be produced in the world-epoch making form as soon as art as such comes into existence; in other words, that in the domain of art certain important forms of it are possible only at a low stage of its development. If that be true of the mutual relations of different forms of art within the domain of art itself, it is far less surprising that the same is true of the relation of art as a whole to the general development of society. The difficulty lies only in the general formulation of these contradictions. No sooner are they specified than they are explained. Let us take for instance the relation of Greek art and of that of Shakespeare’s time to our own. It is a well known fact that Greek mythology was not only the arsenal of Greek art, but also the very ground from which it had sprung. Is the view of nature and of social relations which shaped Greek imagination and Greek [art] possible in the age of automatic machinery, and railways, and locomotives, and electric telegraphs? Where does Vulcan come in as against Roberts & Co.; Jupiter, as against the lightning rod; and Hermes, as against the Credit Mobilier? All mythology masters and dominates and shapes the forces of nature in and through the imagination; hence it disappears as soon as man gains mastery over the forces of nature. What becomes of the Goddess Fame side by side with Printing House Square?[169] Greek art presupposes the existence of Greek mythology, i. e. that nature and even the form of society are wrought up in popular fancy in an unconsciously artistic fashion. That is its material. Not, however, any mythology taken at random, nor any accidental unconsciously artistic elaboration of nature (including under the latter all objects, hence [also] society). Egyptian mythology could never be the soil or womb which would give birth to Greek art. But in any event [there had to be] _a_ mythology. In no event [could Greek art originate] in a society which excludes any mythological explanation of nature, any mythological attitude towards it and which requires from the artist an imagination free from mythology.

Looking at it from another side: is Achilles possible side by side with powder and lead? Or is the Iliad at all compatible with the printing press and steam press? Does not singing and reciting and the muses necessarily go out of existence with the appearance of the printer’s bar, and do not, therefore, disappear the prerequisites of epic poetry?

But the difficulty is not in grasping the idea that Greek art and epos are bound up with certain forms of social development. It rather lies in understanding why they still constitute with us a source of aesthetic enjoyment and in certain respects prevail as the standard and model beyond attainment.

A man can not become a child again unless he becomes childish. But does he not enjoy the artless ways of the child and must he not strive to reproduce its truth on a higher plane? Is not the character of every epoch revived perfectly true to nature in child nature? Why should the social childhood of mankind, where it had obtained its most beautiful development, not exert an eternal charm as an age that will never return? There are ill-bred children and precocious children. Many of the ancient nations belong to the latter class. The Greeks were normal children. The charm their art has for us does not conflict with the primitive character of the social order from which it had sprung. It is rather the product of the latter, and is rather due to the fact that the unripe social conditions under which the art arose and under which alone it could appear can never return.

(End of Manuscript.)

FOOTNOTES:

[1] Cf. Seligman, “The Economic Interpretation of History.” MacMillan. 1902.

[2] Aristotle, d. Rep. L. l, c. 9 (edit. I Bekkeri Oxonii, 1837)

“ἑκάστου γὰρ κτήματος διττὴ ἡ χρῆσίς ἐστιν ... ἡ μὲν οἰκεία, ἡ δ’ οὐκ οἰκεία τοῦ πράγματος, οἷον ὑποδήματος ἥ τε ὑπόδησις καὶ ἡ μεταβλητική. Ἀμφότεραι γὰρ ὑποδήματος χρήσεις· καὶ γὰρ ὁ ἀλλαττόμενος τῷ δεομένῳ ὑποδήματος ἀντὶ νομίσματος ἢ τροφῆς χρῆται τῷ ὑποδήματι ᾗ ὑπόδημα, ἀλλ’ οὐ τὴν οἰκείαν χρῆσιν· οὐ γὰρ ἀλλαγῆς ἕνεκεν γέγονεν. Τὸν αὐτὸν δὲ τρόπον ἔχει καὶ περὶ τῶν ἄλλων κτημάτων.”

(“Of everything which we possess there are two uses:―one is the proper, and the other the improper or secondary use of it. For example, a shoe is used for wear, and is used for exchange; both are uses of the shoe. He who gives a shoe in exchange for money or food to him who wants one, does indeed use the shoe as a shoe, but this is not its proper or primary purpose, for a shoe is not made to be an object of barter. The same may be said of all possessions.” The Politics of Aristotle, translated into English by B. Jowett, Oxford, 1885, v. I., p. 15.)

[3] That is the reason why German compilers are so fond of dwelling on use-value, calling it a “good.” See e. g. L. Stein, “System der Staatswissenschaften,” v. I., chapter on “goods” (Gütter). For intelligent information on “goods” one must turn to treatises on commodities.

[4] A ridiculous presumption has gained currency of late to the effect that common property in its primitive form is specifically a Slavonian, or even exclusively Russian form. It is the primitive form which we can prove to have existed among Romans, Teutons, and Celts; and of which numerous examples are still to be found in India, though in a partly ruined state. A closer study of the Asiatic, especially of Indian forms of communal ownership would show how from the different forms of primitive communism different forms of its dissolution have been developed. Thus e. g. the various original types of Roman and Teutonic private property can be traced back to various forms of Indian communism.

[5] “La Ricchezza è una ragione tra due persone.” (“Value is a relation between two persons”) Galiani, “Della Moneta,” p. 220 in vol. II. of Custodi’s collection of “Scrittori classici Italiani di Economia Politica. Parte Moderna,” Milano, 1803.

[6] “In its natural state, matter ... is always destitute of value.” McCulloch, “A Discourse on the Rise, Progress, Peculiar Objects, and Importance of Political Economy,” 2nd edition, Edinburgh, 1825, pg. 48. It is evident how even a McCulloch stands above the fetishism of German “thinkers”, who declare “matter” and half a dozen other foreign things to be elements of value. Cf. e. g. L. Stein, l. c. v. I., p. 110.

[7] Berkeley, _The Querist_, London, 1750.

[8] Thomas Cooper, Lectures on the Elements of Political Economy, London, 1831, p. 99.

[9] F. List could never grasp the difference between labor as a source of use-value and labor as the creator of certain social form of wealth or exchange value, because comprehension was altogether foreign to his practical mind; he therefore saw in the modern English economists mere plagiarists of Moses, the Egyptian.

[10] It can be readily understood what kind of “service” is rendered by the category “service” to economists of the type of J. B. Say and F. Bastiat, whose pondering sagacity, as Malthus has justly remarked, always abstracts from the specially definite forms of economic relations.

[11] “Egli è proprio ancora delle misure d’aver si fatta relazione colle cose misurate, che in certo modo la misurata divien misura della misurante.” Montanari, Della Moneta, p. 48 in v. III of Custodi’s “Scrittori classici Italiani di Economia Politica. Parte Antica.” (“It is the property of measure to be in such a relation to the things measured, that in a certain way the thing measured becomes the measure of the measuring thing.”)

[12] It is in that sense that Aristotle (see the passage quoted at the beginning of this chapter) conceives exchange value.

[13] This expression is used by Genovesi.

[14] Aristotle makes the same remark with reference to the private family as the primitive community. But the primitive form of family is the tribal family, from the historical dissolution of which the private family develops. ἐν μὲν οὔν τῃ πρώτο κοινωνίᾳ (τοῦτο δ’ ἐστὶν οἰκίἀ) φανερὸν ὅτι οὐδέν ἐστιν ἔργον αὐτῆς (namely της ἀλλαγῆς) “And in the first community, which is the family, this art is obviously of no use.” Jowett’s transl. l. c.

[15] “Money is, in fact, only the instrument for carrying on buying and selling (but, if you please, what do you understand by buying and selling?) and the consideration of it no more forms a part of the science of political economy, than the consideration of ships, or steam engines, or of any other instrument employed to facilitate the production and distribution of wealth.” Th. Hodgskin, Popular Political Economy, etc. London, 1827, p. 178, 179.

[16] A comparative study of the writings and characters of Petty and Boisguillebert, outside of the light which it would throw upon the difference of French and English society at the end of the seventeenth and the beginning of the eighteenth centuries, would disclose the origin of the national contrast between English and French Political Economy. The same contrast reasserts itself in Ricardo and Sismondi.

[17] Petty had illustrated the productive power inherent in the division of labor on a much grander scale than that was done later by Adam Smith. See his “Essay concerning the multiplication of mankind, etc.,” 3rd edition, 1686, p. 35-36. He not only brings out the advantages of the division of labor on the example of the manufacture of a watch, as Adam Smith did later on that of a needle, but considers also a city and an entire country from the point of view of a large manufacturing establishment. The Spectator, of November 26, 1711, refers to this “illustration of the admirable Sir William Petty.” McCulloch is, therefore, mistaken when he supposes that the Spectator confounded Petty with a writer forty years his junior. See McCulloch, “The Literature of Political Economy, a classified catalogue,” London, 1845, p. 105. Petty is conscious of being the founder of a new science. His method, he says, “is not yet very usual, for instead of using only comparative and superlative Words, and intellectual Arguments,” he has undertaken to speak “in Terms of Number, Weight or Measure; to use only Arguments of Sense, and to consider only such Causes, as have visible Foundations in Nature; leaving those that depend upon the mutable Minds, Opinions, Appetites, and Passions of particular Men, to the Consideration of others.” (Political Arithmetick, etc., London, 1699. Preface.) (A new edition of “The Economic Writings of Sir William Petty,” edited by Chas. Henry Hull, has been published by the University Press at Cambridge, 1899. The above passage will be found in vol. I., p. 244. The further references are given to this new, more accessible edition. Translator.) His wonderful keenness shows itself e. g. in the proposal to transport “all the moveables and people of Ireland, and of the Highlands of Scotland ... into the rest of Great Britain.” Thereby much labor-time would be saved, the productivity of labor increased, and “the King and his Subjects would thereby become more Rich and Strong.” (Political Arithmetick, ch. 4, p. 285.) Or in the chapter of his Political Arithmetic in which he proves that England’s mission is the conquest of the world’s market at a time when Holland still played the leading part as a trading nation and France seemed to be on the way of becoming the ruling trading Power: “That the King of England’s Subjects, have Stock competent and convenient, to drive the Trade of the whole Commercial World” (l. c., ch. 10, p. 311). “That the Impediments of England’s greatness are but contingent and removable” (l. c., ch. 5, p. 298). A singular humor pervades all his writings. Thus, he shows that it was by material means that Holland―at that time the model country with English economists, just as England is with continental economists to-day―conquered the world market “without such Angelical Wits and Judgments, as some attribute to the Hollanders” (l. c., p. 258). He advocates “Liberty of Conscience” as a condition of trade, because “Dissenters ... are ... patient Men, and such as believe that Labour and Industry is their Duty towards God,” and “They believe that ... for those who have less Wealth, to think they have the more Wit and Understanding, especially of the things of God which they think chiefly belong to the Poor.” “From whence it follows that Trade is not fixt to any species of Religion as such; but rather ... to the Heterodox part of the whole” (l. c., p. 262-264). He advocates an “allowance by Publick Tax” for those “who live by begging, cheating, stealing, gaming, borrowing without intention of restoring,” because “it were more for the publick profit” to tax the country for such persons “than to suffer them to spend extravagantly, at the only charge of careless, credulous, and good natured People” (p. 269-270). But he is opposed to taxes which transfer the wealth from industrious people “to such as do nothing at all, but eat and drink, sing, play, and dance; nay such as study the Metaphysicks” (ibid.). Petty’s writings are rarities of the bookseller’s trade and are to be found only in scattered poor old editions, which is the more surprising since William Petty was not only the father of English Political Economy, but also the ancestor of Henry Petty, alias Marquis of Lansdowne, the nestor of the English Whigs. However, the Lansdowne family could hardly bring out a complete edition of Petty’s works without prefacing it with his biography, and what can be said of most origins of the great Whig families holds good also in this case, viz., “the less said of them the better.” The keen-witted but cynical army surgeon who was as ready to plunder in Ireland under the shield of Cromwell as to crawl before Charles II. to get the title of baron which he needed for his plunderings, is a model hardly fit for public exhibition. Besides that, Petty seeks to prove in most of his writings which he published in his lifetime, that England’s prosperity reached its climax under Charles II., a heterodox view for the hereditary exploiters of the “glorious revolution.”

[18] In contrast with the “black art of finance” of his time, Boisguillebert says: “La science financière n’est que la connaissance approfondie des intérêts de l’agriculture et du commerce.” Le Détail de la France, 1697. Eugène Daire’s edition of Economistes financiers du XVIII. siècle, Paris, 1843, vol. I., p. 241.

[19] But not _Romance_ Political Economy, since the Italians reproduce the contrast between the English and French economists in the two respective schools of Naples and Milan, while the Spaniards of the earlier period are either pure Mercantilists; modified mercantilists like Ustariz; or, like Jovellanos (see his Obras, Barcelona, 1839-40), hold to the “golden mean” with Adam Smith.

[20] “La véritable richesse ... jouissance entière, non seulement des besoins de la vie, mais même de tous les superflus et de tout, ce qui peut fair plaisir à la sensualité,” Boisguillebert, “Dissertation sur la nature de la richesse,” etc., l. c., p. 403. But while Petty was a frivolous, rapacious and unprincipled adventurer, Boisguillebert, though an intendant under Louis XIV, championed the interests of the oppressed classes with a daring that was equal to his keenness of mind.

[21] The French Socialism of the Proudhon type suffers from the same national hereditary disease.

[22] “Benjamin Franklin, The Works of, etc.,” ed. by I. Sparks, vol. II., Boston, 1836. “A Modest Inquiry into the Nature and Necessity of a Paper Currency.”

[23] L. c., p. 265.

[24] L. c., p. 267.

[25] L. c., “Remarks and Facts relative to the American Paper Money,” 1764.

[26] See “Papers on American Politics; Remarks and Facts relative to the American Paper Money,” 1764, l. c.

[27] See e. g. Galiani, “Della Moneta,” in vol. 3 of Scrittori Classici italiani di Economia politica (Published by Custodi). Parte Moderna, Milano, 1803. “La fatica, he says, è l’unica che dà valore alla cosa” (“only effort can give value to any thing”). The designation of labor as “fatica,” strain, effort, is characteristic of the southerner.

[28] Steuart’s work, “An Inquiry into the Principles of Political Economy, being an Essay on the Science of Domestic Policy in Free Nations,” appeared first in London in two quarto volumes in the year 1767, ten years before Adam Smith’s “Wealth of Nations.” I quote from the Dublin edition of 1770. (The references to pages are the same for the standard London edition of 1767, except where otherwise stated. Translator.)

[29] Steuart, l. c., vol. I., p. 181-183.

[30] Steuart, l. c., vol. I., p. 361-362.

[31] See chapter I., book II., vol. I. “of the reciprocal connections between Trade and Industry” (Translator).

[32] He declares, therefore, the patriarchal form of agriculture which is devoted to the direct production of use-values for the owner of the land, to be an “abuse,” not in Sparta, or Rome, or even in Athens, but in the industrial countries of the eighteenth century. This “abusive agriculture” is not “trade,” but a “direct means of subsisting.” Just as capitalistic agriculture clears the country of superfluous mouths, so does the capitalistic mode of manufacture clear the factory of superfluous hands.

[33] Thus e. g., Adam Smith says: “Equal quantities of labour, at all times and places, may be said to be of equal value to the labourer. In his ordinary state of health, strength and spirits, in the ordinary degree of his skill and dexterity, he must always lay down the same portion of his ease, his liberty, and his happiness. The price which he pays must always be the same, whatever may be the quantity of goods which he receives in return for it. Of these, indeed, it may sometimes purchase a greater and sometimes a smaller quantity; but it is their value which varies, not that of the labour which purchases them.... Labour alone, therefore, never varying in its own value ... is their [commodities’] real price, etc. Adam Smith (Book I., ch. V., p. 34, Oxford, 1869. Translator.)

[34] David Ricardo, “On the Principles of Political Economy and Taxation,” 3rd edition, London, 1821, p. 3.

[35] Sismondi, “Etudes sur l’Economie Politique,” t. II., Bruxelles, 1837. “C’est l’opposition entre la valeur usuelle ... et la valeur échangeable à laquelle le commerce a reduit toute chose,” p. 161. [Paris edition, p. 229, Transl.]

[36] Sismondi l. c., p. 163-166 seq. [Paris edition, 230 etf. Transl.]

[37] Perhaps the silliest to be found are the annotations of J. B. Say to the French translation of Ricardo, made by Constancio, and the most pedantically arrogant are the remarks of Mr. MacLeod in his newly published “Theory of Exchange,” London, 1858.

[38] This objection raised against Ricardo by bourgeois economists was taken up later by the socialists. Having assumed the correctness of the formula, they charged the practice with contradiction to the theory and appealed to bourgeois society to realize in practice the conclusions which were supposed to follow from its theoretical principles. That was at least the way in which the English socialists turned Ricardo’s formula of exchange value against political economy. It remained for Mr. Proudhon not only to proclaim the fundamental principle of old society as the principle of the new, but also to declare himself the discoverer of the formula in which Ricardo summed up the combined results of classical English political economy. It has been proven that the utopian interpretation of the Ricardian formula was about forgotten in England when Mr. Proudhon “discovered” it on the other side of the Canal. (Cf. my work: “Misère de la Philosophie,” etc., Paris, 1847, paragraph on la valeur constituée.)

[39] True, Aristotle sees that the exchange value of commodities underlies their prices: “ὅτι ὴ ἀλλαγη ἥν πρὶν τὸ νόμισμα ἔιναι, ὁῆλον· διαφέρει γὰρ οὐδὲν ἡ εί κλίναι πέντε ἀντι οἰκίας, ἣ ὅσου αὶ πέντε κλῖναι.” (“It is clear that exchange existed before coin. For it does not make any difference whether you give five beds for a house, or as much money as five beds are worth”). On the other hand, since commodities acquire only in price the form of exchange value with respect to one another, he makes them commensurable through money. “Διὸ δεῖ πάντα τετιμῆσθαι· οὕτω γὰρ ἀεὶ ἔσται ἀλλαγὴ, εἰ δὲ τοῦτο, κοινωνία. Τὸ δὴ νόμισμα ὥσπερ μέτρον σύμμετρα ποιῆσαν ἰσάζει, οὔτε γὰρ ἃν μὴ οὔσης ἀλλαγῆς κοινωνία ἡν, ὄυτ’ ἀλλαγὴ ἰσότητος μὴ οὔτ’ἰσότης, μὴ οὔσης συμμετρίας.” (“Therefore all has to be appraised. In that way exchange may always take place, and, with it, society can exist. Coin, like measure, makes everything commensurable and equal, for without exchange there would be no society, without equality there would be no exchange, and without commensurability, no equality.”) He does not conceal from himself that these different objects measured by money are entirely incommensurable quantities. What he is after is the common unit of commodities as exchange values, which as an ancient Greek he was unable to find. He gets out of the difficulty by making commensurable through money what is in itself incommensurable, so far as it is necessary for practical purposes. “Τῇ μὲν οὔν ἀληθείᾳ ἀδύνατον τὰ τοσοῦτον διαφέροντα σύμμετρα γενέσθαι, πρὸς δὲ τὴν χρείαν ἐνδέχεται ἰκανῶς.” (“In truth it is impossible to make things that are so different, commensurable, but for practical purposes it is permissible.”) Aristotle, Ethica Nicomachea. l. 5, c. 8, edit. Bekkeri. Oxonii, 1837.

[40] The peculiar circumstance that, while the ounce of gold serves in England as the unit of the standard of money, it is not divided into aliquot parts has been explained as follows: “Our coinage was originally adapted to the employment of silver only―hence an ounce of silver can always be divided into a certain adequate number of pieces of coin; but as gold was introduced at a later period into a coinage adapted only to silver, an ounce of gold cannot be coined into an adequate number of pieces.” Maclaren: “A Sketch of the History of the Currency,” p. 16, London, 1858.

[41] “Money may continually vary in value and yet be as good a measure of value as if it remained perfectly stationary. Suppose, for instance, it is reduced in value.... Before the reduction, a guinea would purchase three bushels of wheat or 6 days’ labour; subsequently it would purchase only 2 bushels of wheat, or 4 days’ labour. In both cases, the relations of wheat and labour to money being given, their mutual relations can be inferred; in other words, we can ascertain that a bushel of wheat is worth 2 days’ labour. This, which is all that measuring value implies, is as readily done after the reduction as before. The excellence of a thing as a measure of value is altogether independent of its own variableness in value” (p. 11, Bailey, “Money and its Vicissitudes.” London, 1837).

[42] “Le monete lequali oggi sono ideali sono le piu antiche d’ogni nazione, e tutte furono un tempo reali (the latter assertion is too sweeping), e perchè erano reali con esse si contava.” Galiani, “Della Moneta,” l. c., p. 153 (“Coins which are ideal to-day [i. e., whose names no longer correspond to their value] are among the more ancient with every nation; at one time they were all real, and for that reason served for the purpose of counting.”)

[43] The romantic A. Müller says: “According to our idea every independent sovereign has the right to name the metal money, and to give it a nominal social value, rank, standing and title (p. 276, v. II., A. H. Müller, “Die Elemente der Staatskunst,” Berlin, 1809). As far as title is concerned the Hon. Hofrath is right; but he forgets the _substance_. How confused his “ideas” were, may be seen, e. g., from the following passage: “Everybody understands how much depends upon the right determination of the mint-price, especially in a country like England, where the government with _magnificent liberality_ coins money gratuitously (Herr Müller seems to think that the members of the English government defray the mint expenses out of their own pockets), where it does not charge any mintage, etc., and thus if the mint-price of gold were set considerably above its market price, if instead of paying as now £3 17s. 10-1/2d. per 1 oz. of gold, it would set the price of an ounce of gold at £3 19s., all money would flow into the mint and exchanging for the silver contained there bring it into the market to be exchanged there for the cheaper gold; the latter would in the same manner be brought again to the mint and the entire coinage system would be upset” (l. c., p. 280-281). To preserve order in English coinage, Müller falls back on “disorder.” While shilling and pence are mere names of certain parts of an ounce of gold represented by signs of silver and copper, he imagines that an ounce of gold is estimated in gold, silver and copper and thus confers upon the Englishmen the blessing of a triple standard of value. Silver as a measure of money, next to gold, was formally abolished only in 1816 by 56 George III., c. 68. As a matter of fact, it was legally abolished as early as 1734 by 14 George II., c. 42, and still earlier by actual practice. There were two circumstances that made A. Müller capable of a so-called higher conception of political economy: first, his wide ignorance of economic facts; second, his dilettanti-like visionary attitude toward philosophy.

[44] “Ἀνάχαρσις, πυνθανομένου τινὸς, πρὸς τί οί Ἕλληνες χρῶνται τῷ ἀργυρίῳ ἕιπε πρὸς τὸ ἀριθμεῖν.” (Athen. Deipn. l. IV. 49. v. 2, ed. Schweighäuser, 1802.) (When Anacharsis was asked for what purpose the Greeks used money, he replied, “For reckoning.―‘’“”)

[45] G. Garnier, one of the early French translators of Adam Smith, conceived the queer notion of fixing a proportion between the use of money of account and that of actual money. His proportion is 10 to 1. (G. Garnier, “Histoire de la Monnaie depuis les temps de la plus haute antiquité,” etc., t. 1, p. 78.)

[46] The act of Maryland in 1723 by which tobacco was made the legal standard, but its value reduced to terms of English gold money, namely one penny equal to one pound of tobacco, reminds of the “leges barbarorum,” in which, inversely, certain sums of money were expressed in terms of oxen, cows, etc. In that case neither gold nor silver, but the ox and the cow were the actual material of the money of account.

[47] Thus, we read, e. g., in the “Familiar Words” of Mr. David Urquhart: “The value of gold is to be measured by itself; how can any substance be the measure of its own worth in other things? The worth of gold is to be established by its own weight, under a false denomination of that weight―and an ounce is to be worth so many pounds and fractions of pounds. This is falsifying a measure, not establishing a standard.―‘’“”

[48] “Money is the measure of Commerce, and of the rate of everything, and therefore ought to be kept (as all other measures) as steady and invariable as may be. But this cannot be, if your money be made of two Metals, whose proportion ... constantly varies in respect of one another.” John Locke: Some Considerations on the Lowering of Interest, etc., 1691 (p. 166, p. 65 in his Works 7 ed., London, 1768, vol. III.)

[49] Locke says among other things: “ ... call that a Crown now, which before ... was but a part of a Crown.... An equal quantity of Silver is always the same Value with an equal quantity of Silver.... For if the abating 1-20 of the quantity of Silver of any Coin does not lessen its Value, the abating 19-20 of the quantity of the Silver of any Coin will not abate its Value. And so a single Penny, being called a Crown, will buy as much Spice, or Silk, or any other Commodity, as a Crown-Piece, which contains 20 times as much Silver.... Now [all that may be done] is giving a less quantity of Silver the Stamp and Denomination of a greater.... But ’tis Silver and not Names that pay Debts and purchase Commodities” (l. c., p. 135-145 passim). If to raise the value of money means nothing but to give any desired name to an aliquot part of a silver coin, e. g., to call an eighth part of an ounce of silver a penny, then money may really be rated as high as you please. At the same time, Locke answered Lowndes that the rise of the market price above the mint price was due not to the rise of the value of silver, but to the lighter silver coins. Seventy-seven clipped shillings do not weigh a particle more than 62 full-weighted ones. Finally he pointed out with perfect right that, aside from the loss of weight in the circulating coin, the market price of silver bullion in England could rise to some extent above its mint price, since the export of silver bullion was allowed while that of silver coin was prohibited (l. c., p. 54-116 passim). Locke was exceedingly careful not to touch upon the burning question of public debts, and no less carefully avoided the discussion of the delicate economic question, viz., the depreciation of the currency out of proportion to its real loss of silver, as was shown by the rate of exchange and the ratio of silver bullion to silver coin. We shall return to this question in its general form in the chapter on the Medium of Circulation. Nicholas Barbon in “A Discourse Concerning Coining the New Money Lighter, in Answer to Mr. Locke’s Considerations, etc.,” London, 1696, tried in vain to entice Locke to difficult ground.

[50] Steuart, l. c., v. II., p. 154.

[51] The Querist, l. c., (p. 5-6-7.) The “Queries on Money” are generally clever. Among other things Berkeley is perfectly right in saying that by their progress the North American colonies “make it plain as daylight, that gold and silver are not so necessary for the wealth of a nation, as the vulgar of all ranks imagine.―‘’“”

[52] Price means here real equivalent in the sense commonly employed by English economic writers in the seventeenth century.

[53] Steuart, l. c., v. II., p. 154, 299 [1st London edition, of 1767, v. I., p. 526-531. Transl.].

[54] On the occasion of the last commercial crisis the ideal African money received loud praise from certain English quarters, after its seat was this time moved from the coast to the heart of Barbary. The freedom of the Berbers from commercial and industrial crises was ascribed to the ideal unit of measure of their bars. Would it not have been simpler to say that trade and industry are the _conditio sine qua non_ of commercial and industrial crises?

[55] The Currency Question, The Gemini Letters, London, 1844, p. 260-272, passim.

[56] John Gray: “The Social System. A Treatise on the Principle of Exchange, Edinburgh, 1831.” Compare with “Lectures on the Nature and Use of Money, Edinburgh, 1848,” by the same author. After the February revolution Gray sent a memorial to the provisional French government, in which he instructs the latter that France is not in need of an “organization of labour,” but of an “organization of exchange” of which the plan is fully worked out in his money system. Honest John did not suspect that sixteen years after the appearance of his “Social System” a patent for the same discovery would be taken out by the ingenious Proudhon.

[57] Gray, “The Social System,” etc., p. 63: “Money should be merely a receipt, an evidence that the holder of it has either contributed certain value to the national stock of wealth or that he has acquired a right to the same value from some one who has contributed to it.―‘’“”

[58] An estimated value being previously put upon produce, let it be lodged in a bank, and drawn out again, whenever it is required, merely stipulating, by common consent, that he who lodges any kind of property in the proposed National Bank, may take out of it an equal value of whatever it may contain, instead of being obliged to draw out the self-same thing that he put in.” L. c., p. 68.

[59] L. c., p. 16.

[60] Gray: “Lectures on Money, etc.,” p. 182.

[61] L. c., p. 169.

[62] “The business of every country ought to be conducted on a national capital.” John Gray, “The Social System,” etc., p. 171.

[63] “The land to be transformed into national property.” L. c., p. 298.

[64] See e. g. W. Thompson: “An Inquiry into the Distribution of Wealth, etc.,” London, 1827. Bray, “Labour’s Wrongs and Labour’s Remedy,” Leeds, 1839.

[65] Alfred Darimont’s “De la Reforme des banques,” Paris, 1856, may be considered as a compendium of this melodramatic theory of money.

[66] “Di due sorte è la moneta, ideale e reale; e a dui diversi usi è adoperata, a valutare le cose e a comperarle. Per valutare è buona la moneta ideale, cosi come la reale e forse anche più. L’altro uso della moneta è di comperare quelle cose istesse, ch’ella apprezza ... i prezzi e i contratti si valutano in moneta ideale e si eseguiscono in moneta reale.” Galiani, l. c., p. 112 sq. (“Money is of two kinds, ideal and real; and is adapted to two different uses: to determine the value of things and to buy them. For the purpose of valuation ideal money is as good as real and perhaps even better. The other use of money is to buy the same things which it appraises ... prices and contracts are determined in ideal money and are executed in real money.”)

[67] This, of course, does not prevent the market price of commodities to be above or below their value. However, this consideration is foreign to simple circulation and belongs to quite another sphere to be considered later, when we shall investigate the relation between value and market price.

[68] How deeply some beautiful souls are wounded by the merely superficial aspect of the antagonism which asserts itself in buying and selling, may be seen from the following abstract from M. Isaac Pereire’s: “Leçons sur l’industrie et les finances,” Paris, 1832. The fact that the same Isaac in his capacity of inventor and dictator of the “Credit mobilier” has acquired the reputation of the wolf of the Paris Bourse shows what lurks behind the sentimental criticism of economics. Says Mr. Pereire at the time an apostle of St. Simons: “C’est parceque tous les individus sont isolés, séparés les uns des autres, soit dans leur travaux, soit pour la consommation, qu’il y a echange entre eux des produits de leur industrie respective. De la nécessité de l’échange est derivée la nécessité de determiner la valeur relative des objets. Les idées de la valeur et de l’échange sont donc intimement liées, et toutes deux dans leur forme actuelle exprime l’individualisme et l’antagonisme.... Il n’y a lieu a fixer la valeur des produits que parcequ’il y a vente at achat, en d’autres termes, antagonisme entre les divers membres de la societé. Il n’y a lieu à s’occuper du prix, de valeur que là où il y avait vente et echat, c’est à dire, où chaque individu était obligé de lutter, pour se procurer les object nécessaires a l’entretien de son existence” (l. c., p. 2, 3 passim). (“Since individuals are isolated and separated from one another both in their labors and in consumption, exchange takes place between them in the products of their respective industries. From the necessity of exchange arises the necessity of determining the relative value of things. The ideas of value and exchange are thus intimately connected and both express in their actual form individualism and antagonism.... The determination of values of products takes place only because there are sales and purchases, or, to put it differently, because there is an antagonism between different members of society. One has to occupy himself with price and value only where there is sale and purchase, that is to say, where every individual is obliged to struggle to procure for himself the objects necessary for the maintenance of his existence.”)

[69] “L’argent n’est que le moyen et l’acheminement, au lieu que les denrées utiles à la vie sont la fin et le but.” (“Money is but the ways and means, while the things useful in life are the end and object.”) Boisguillebert: “Le Détail de la France,” 1697, in Eugene Daires’ “Economistes financiers du XVIIIieme siècle, vol. I., Paris, 1843, p. 210.

[70] In November, 1807, William Spence published a pamphlet in England under the title: “Britain Independent of Commerce.” The principle set forth in this pamphlet was further elaborated by William Cobbet in his “Political Register” under the virulent title, “Perish Commerce.” To this James Mill replied in 1808 in his “Defence of Commerce” which contains the passage quoted above from his “Elements of Political Economy” (p. 190-193, Transl.). In his controversy with Sismondi and Malthus on commercial crises, J. B. Say appropriated this clever device, and as it would be difficult to point out with what new idea this comical “prince de la science” had enriched political economy, his continental admirers have trumpeted him as the man who had unearthed the treasure of the metaphysical balance of purchases and sales; as a matter of fact, his merits consisted rather of the impartiality with which he equally misunderstood his contemporaries, Malthus, Sismondi and Ricardo.