System of Economical Contradictions; or, the Philosophy of Misery Part 8

Now, the point that no one has noticed is that, of all the various articles of merchandise, gold and silver were the first whose value was determined. In the patriarchal period, gold and silver still were bought and sold in ingots, but already with a visible tendency to superiority and with a marked preference.

Gradually sovereigns took possession of them and stamped them with their seal; and from this royal consecration was born money,--that is, the commodity par excellence; that which, notwithstanding all commercial shocks, maintains a determined proportional value, and is accepted in payment for all things.

That which distinguishes specie, in fact, is not the durability of the metal, which is less than that of steel, nor its utility, which is much below that of wheat, iron, coal, and numerous other substances, regarded as almost vile when compared with gold; neither is it its scarcity or density, for in both these respects it might be replaced, either by labor spent upon other materials, or, as at present, by bank notes representing vast amounts of iron or copper. The distinctive feature of gold and silver, I repeat, is the fact that, owing to their metallic properties, the difficulties of their production, and, above all, the intervention of public authority, their value as merchandise was fixed and authenticated at an early date.

I say then that the value of gold and silver, especially of the part that is made into money, although perhaps it has not yet been calculated accurately, is no longer arbitrary; I add that it is no longer susceptible of depreciation, like other values, although it may vary continually nevertheless. All the logic and erudition that has been expended to prove, by the example of gold and silver, that value is essentially indeterminable, is a ma.s.s of paralogisms, arising from a false idea of the question, ab ignorantia elenchi.

Philip I., King of France, mixed with the livre tournois of Charlemagne one-third alloy, imagining that, since he held the monopoly of the power of coining money, he could do what every merchant does who holds the monopoly of a product. What was, in fact, this adulteration of money, for which Philip and his successors are so severely blamed? A very sound argument from the standpoint of commercial routine, but wholly false in the view of economic science,--namely, that, supply and demand being the regulators of value, we may, either by causing an artificial scarcity or by monopolizing the manufacture, raise the estimation, and consequently the value, of things, and that this is as true of gold and silver as of wheat, wine, oil, tobacco.

Nevertheless, Philip's fraud was no sooner suspected than his money was reduced to its true value, and he lost himself all that he had expected to gain from his subjects. The same thing happened after all similar attempts. What was the reason of this disappointment?

Because, say the economists, the quant.i.ty of gold and silver in reality being neither diminished nor increased by the false coinage, the proportion of these metals to other merchandise was not changed, and consequently it was not in the power of the sovereign to make that which was worth but two worth four. For the same reason, if, instead of debasing the coin, it had been in the king's power to double its ma.s.s, the exchangeable value of gold and silver would have decreased one-half immediately, always on account of this proportionality and equilibrium. The adulteration of the coin was, then, on the part of the king, a forced loan, or rather, a bankruptcy, a swindle.

Marvelous! the economists explain very clearly, when they choose, the theory of the measure of value; that they may do so, it is necessary only to start them on the subject of money. Why, then, do they not see that money is the written law of commerce, the type of exchange, the first link in that long chain of creations all of which, as merchandise, must receive the sanction of society, and become, if not in fact, at least in right, acceptable as money in settlement of all kinds of transactions?

"Money," M. Augier very truly says, "can serve, either as a means of authenticating contracts already made, or as a good medium of exchange, only so far as its value approaches the ideal of permanence; for in all cases it exchanges or buys only the value which it possesses."[8]

[8] "History of Public Credit."

Let us turn this eminently judicious observation into a general formula.

Labor becomes a guarantee of well-being and equality only so far as the product of each individual is in proportion with the ma.s.s; for in all cases it exchanges or buys a value equal only to its own.

Is it not strange that the defence of speculative and fraudulent commerce is undertaken boldly, while at the same time the attempt of a royal counterfeiter, who, after all, did but apply to gold and silver the fundamental principle of political economy, the arbitrary instability of values, is frowned down? If the administration should presume to give twelve ounces of tobacco for a pound,[9] the economists would cry robbery; but, if the same administration, using its privilege, should increase the price a few cents a pound, they would regard it as dear, but would discover no violation of principles. What an imbroglio is political economy!

[9] In France, the sale of tobacco is a government monopoly.-- Translator.

There is, then, in the monetization of gold and silver something that the economists have given no account of; namely, the consecration of the law of proportionality, the first act in the const.i.tution of values. Humanity does all things by infinitely small degrees: after comprehending the fact that all products of labor must be submitted to a proportional measure which makes all of them equally exchangeable, it begins by giving this attribute of absolute exchangeability to a special product, which shall become the type and model of all others. In the same way, to lift its members to liberty and equality, it begins by creating kings. The people have a confused idea of this providential progress when, in their dreams of fortune and in their legends, they speak continually of gold and royalty; and the philosophers only do homage to universal reason when, in their so-called moral homilies and their socialistic utopias, they thunder with equal violence against gold and tyranny. Auri sacra fames! Cursed gold! ludicrously shouts some communist. As well say cursed wheat, cursed vines, cursed sheep; for, like gold and silver, every commercial value must reach an exact and accurate determination. The work was begun long since; today it is making visible progress.

Let us pa.s.s to other considerations.

It is an axiom generally admitted by the economists that ALL LABOR SHOULD LEAVE AN EXCESS.

I regard this proposition as universally and absolutely true; it is a corollary of the law of proportionality, which may be regarded as an epitome of the whole science of economy. But--I beg pardon of the economists--the principle that ALL LABOR SHOULD LEAVE AN EXCESS has no meaning in their theory, and is not susceptible of demonstration. If supply and demand alone determine value, how can we tell what is an excess and what is a SUFFICIENCY? If neither cost, nor market price, nor wages can be mathematically determined, how is it possible to conceive of a surplus, a profit? Commercial routine has given us the idea of profit as well as the word; and, since we are equal politically, we infer that every citizen has an equal right to realize profits in his personal industry. But commercial operations are essentially irregular, and it has been proved beyond question that the profits of commerce are but an arbitrary discount forced from the consumer by the producer,--in short, a displacement, to say the least. This we should soon see, if it was possible to compare the total amount of annual losses with the amount of profits. In the thought of political economy, the principle that ALL LABOR SHOULD LEAVE AN EXCESS is simply the consecration of the const.i.tutional right which all of us gained by the revolution,-- the right of robbing one's neighbor.

The law of proportionality of values alone can solve this problem. I will approach the question a little farther back: its gravity warrants me in treating it with the consideration that it merits.

Most philosophers, like most philologists, see in society only a creature of the mind, or rather, an abstract name serving to designate a collection of men. It is a prepossession which all of us received in our infancy with our first lessons in grammar, that collective nouns, the names of genera and species, do not designate realities. There is much to say under this head, but I confine myself to my subject. To the true economist, society is a living being, endowed with an intelligence and an activity of its own, governed by special laws discoverable by observation alone, and whose existence is manifested, not under a material aspect, but by the close concert and mutual interdependence of all its members. Therefore, when a few pages back, adopting the allegorical method, we used a fabulous G.o.d as a symbol of society, our language in reality was not in the least metaphorical: we only gave a name to the social being, an organic and synthetic unit. In the eyes of any one who has reflected upon the laws of labor and exchange (I disregard every other consideration), the reality, I had almost said the personality, of the collective man is as certain as the reality and the personality of the individual man. The only difference is that the latter appears to the senses as an organism whose parts are in a state of material coherence, which is not true of society.

But intelligence, spontaneity, development, life, all that const.i.tutes in the highest degree the reality of being, is as essential to society as to man: and hence it is that the government of societies is a SCIENCE,-- that is, a study of natural relations,--and not an ART,-- that is, good pleasure and absolutism. Hence it is, finally, that every society declines the moment it falls into the hands of the ideologists.

The principle that ALL LABOR SHOULD LEAVE AN EXCESS, undemonstrable by political economy,--that is, by proprietary routine,--is one of those which bear strongest testimony to the reality of the collective person: for, as we shall see, this principle is true of individuals only because it emanates from society, which thus confers upon them the benefit of its own laws.

Let us turn to facts. It has been observed that railroad enterprises are a source of wealth to those who control them in a much less degree than to the State. The observation is a true one; and it might have been added that it applies, not only to railroads, but to every industry. But this phenomenon, which is essentially the result of the law of proportionality of values and of the absolute ident.i.ty of production and consumption, is at variance with the ordinary notion of useful value and exchangeable value.

The average price charged for the transportation of merchandise by the old method is eighteen centimes per ton and kilometer, the merchandise taken and delivered at the warehouses. It has been calculated that, at this price, an ordinary railroad corporation would net a profit of not quite ten per cent., nearly the same as the profit made by the old method. But let us admit that the rapidity of transportation by rail is to that by wheels, all allowances made, as four to one: in society time itself being value, at the same price the railroad would have an advantage over the stage-wagon of four hundred per cent. 'Nevertheless, this enormous advantage, a very real one so far as society is concerned, is by no means realized in a like proportion by the carrier, who, while he adds four hundred per cent. to the social value, makes personally less than ten per cent. Suppose, in fact, to make the thing still clearer, that the railroad should raise its price to twenty- five centimes, the rate by the old method remaining at eighteen; it would lose immediately all its consignments; shippers, consignees, everybody would return to the stage-wagon, if necessary. The locomotive would be abandoned; a social advantage of four hundred per cent. would be sacrificed to a private loss of thirty-three per cent.

The reason of this is easily seen. The advantage which results from the rapidity of the railroad is wholly social, and each individual partic.i.p.ates in it only in a very slight degree (do not forget that we are speaking now only of the transportation of merchandise); while the loss falls directly and personally on the consumer. A special profit of four hundred per cent. in a society composed of say a million of men represents four ten-thousandths for each individual; while a loss to the consumer of thirty-three per cent. means a social deficit of thirty- three millions. Private interest and collective interest, seemingly so divergent at first blush, are therefore perfectly identical and equal: and this example may serve to show already how economic science reconciles all interests.

Consequently, in order that society may realize the profit above supposed, it is absolutely necessary that the railroad's prices shall not exceed, or shall exceed but very little, those of the stage-wagon.

But, that this condition may be fulfilled,--in other words, that the railroad may be commercially possible,--the amount of matter transported must be sufficiently great to cover at least the interest on the capital invested and the running expenses of the road. Then a railroad's first condition of existence is a large circulation, which implies a still larger production and a vast amount of exchanges.

But production, circulation, and exchange are not self-creative things; again, the various kinds of labor are not developed in isolation and independently of each other: their progress is necessarily connected, solidary, proportional. There may be antagonism among manufacturers; but, in spite of them, social action is one, convergent, harmonious,--in a word, personal.

Further, there is a day appointed for the creation of great instruments of labor: it is the day when general consumption shall be able to maintain their employment,--that is, for all these propositions are interconvertible, the day when ambient labor can feed new machinery. To antic.i.p.ate the hour appointed by the progress of labor would be to imitate the fool who, going from Lyons to Ma.r.s.eilles, chartered a steamer for himself alone.

These points cleared up, nothing is easier than to explain why labor must leave an excess for each producer.

And first, as regards society: Prometheus, emerging from the womb of Nature, awakens to life in a state of inertia which is very charming, but which would soon become misery and torture if he did not make haste to abandon it for labor. In this original idleness, the product of Prometheus being nothing, his well-being is the same as that of the brute, and may be represented by zero.

Prometheus begins to work: and from his first day's labor, the first of the second creation, the product of Prometheus--that is, his wealth, his well-being--is equal to ten.

The second day Prometheus divides his labor, and his product increases to one hundred.

The third day, and each following day, Prometheus invents machinery, discovers new uses in things, new forces in Nature; the field of his existence extends from the domain of the senses to the sphere of morals and intelligence, and with every step that his industry takes the amount of his product increases, and a.s.sures him additional happiness. And since, finally, with him, to consume is to produce, it is clear that each day's consumption, using up only the product of the day before, leaves a surplus product for the day after.

But notice also--and give especial heed to this all-important fact--that the well-being of man is directly proportional to the intensity of labor and the multiplicity of industries: so that the increase of wealth and the increase of labor are correlative and parallel.

To say now that every individual partic.i.p.ates in these general conditions of collective development would be to affirm a truth which, by reason of the evidence in its support, would appear silly. Let us point out rather the two general forms of consumption in society.

Society, like the individual, has first its articles of personal consumption, articles which time gradually causes it to feel the need of, and which its mysterious instincts command it to create.

Thus in the middle ages there was, with a large number of cities, a decisive moment when the building of city halls and cathedrals became a violent pa.s.sion, which had to be satisfied at any price; the life of the community depended upon it. Security and strength, public order, centralization, nationality, country, independence, these are the elements which make up the life of society, the totality of its mental faculties; these are the sentiments which must find expression and representation. Such formerly was the object of the temple of Jerusalem, real palladium of the Jewish nation; such was the temple of Jupiter Capitolinus of Rome. Later, after the munic.i.p.al palace and the temple,--organs, so to speak, of centralization and progress,--came the other works of public utility,--bridges, theatres, schools, hospitals, roads, etc.

The monuments of public utility being used essentially in common, and consequently gratuitously, society is rewarded for its advances by the political and moral advantages resulting from these great works, and which, furnishing security to labor and an ideal to the mind, give fresh impetus to industry and the arts.

But it is different with the articles of domestic consumption, which alone fall within the category of exchange. These can be produced only upon the conditions of mutuality which make consumption possible,--that is, immediate payment with advantage to the producers. These conditions we have developed sufficiently in the theory of proportionality of values, which we might call as well the theory of the gradual reduction of cost.

I have demonstrated theoretically and by facts the principle that ALL LABOR SHOULD LEAVE AN EXCESS; but this principle, as certain as any proposition in arithmetic, is very far from universal realization. While, by the progress of collective industry, each individual day's labor yields a greater and greater product, and while, by necessary consequence, the laborer, receiving the same wages, must grow ever richer, there exist in society cla.s.ses which THRIVE and cla.s.ses which PERISH; laborers paid twice, thrice, a hundred times over, and laborers continually out of pocket; everywhere, finally, people who enjoy and people who suffer, and, by a monstrous division of the means of industry, individuals who consume and do not produce. The distribution of well-being follows all the movements of value, and reproduces them in misery and luxury on a frightful scale and with terrible energy. But everywhere, too, the progress of wealth--that is, the proportionality of values--is the dominant law; and when the economists combat the complaints of the socialists with the progressive increase of public wealth and the alleviations of the condition of even the most unfortunate cla.s.ses, they proclaim, without suspecting it, a truth which is the condemnation of their theories.

For I entreat the economists to question themselves for a moment in the silence of their hearts, far from the prejudices which disturb them, and regardless of the employments which occupy them or which they wait for, of the interests which they serve, of the votes which they covet, of the distinctions which tickle their vanity: let them tell me whether, hitherto, they have viewed the principle that all labor should leave an excess in connection with this series of premises and conclusions which we have elaborated, and whether they ever have understood these words to mean anything more than the right to speculate in values by manipulating supply and demand; whether it is not true that they affirm at once, on the one hand the progress of wealth and well-being, and consequently the measure of values, and on the other the arbitrariness of commercial transactions and the incommensurability of values,--the flattest of contradictions?

Is it not because of this contradiction that we continually hear repeated in lectures, and read in the works on political economy, this absurd hypothesis: If THE PRICE OF ALL THINGS WAS DOUBLED.

. . . . . ? As if the price of all things was not the proportion of things, and as if we could double a proportion, a relation, a law! Finally, is it not because of the proprietary and abnormal routine upheld by political economy that every one, in commerce, industry, the arts, and the State, on the pretended ground of services rendered to society, tends continually to exaggerate his importance, and solicits rewards, subsidies, large pensions, exorbitant fees: as if the reward of every service was not determined necessarily by the sum of its expenses? Why do not the economists, if they believe, as they appear to, that the labor of each should leave an excess, use all their influence in spreading this truth, so simple and so luminous: Each man's labor can buy only the value which it contains, and this value is proportional to the services of all other laborers?

But here a last consideration presents itself, which I will explain in a few words.

J. B. Say, who of all the economists has insisted the most strenuously upon the absolute indeterminability of value, is also the one who has taken the most pains to refute that idea. He, if I am not mistaken, is the author of the formula: EVERY PRODUCT IS WORTH WHAT IT COSTS; or, what amounts to the same thing: PRODUCTS ARE BOUGHT WITH PRODUCTS. This aphorism, which leads straight to equality, has been controverted since by other economists; we will examine in turn the affirmative and the negative.

When I say that every product is worth the products which it has cost, I mean that every product is a collective unit which, in a new form, groups a certain number of other products consumed in various quant.i.ties. Whence it follows that the products of human industry are, in relation to each other, genera and species, and that they form a series from the simple to the composite, according to the number and proportion of the elements, all equivalent to each other, which const.i.tute each product. It matters little, for the present, that this series, as well as the equivalence of its elements, is expressed in practice more or less exactly by the equilibrium of wages and fortunes; our first business is with the relation of things, the economic law.

For here, as ever, the idea first and spontaneously generates the fact, which, recognized then by the thought which has given it birth, gradually rectifies itself and conforms to its principle.

Commerce, free and compet.i.tive, is but a long operation of redressal, whose object is to define more and more clearly the proportionality of values, until the civil law shall recognize it as a guide in matters concerning the condition of persons. I say, then, that Say's principle, EVERY PRODUCT IS WORTH WHAT IT COSTS, indicates a series in human production a.n.a.logous to the animal and vegetable series, in which the elementary units (day's works) are regarded as equal. So that political economy affirms at its birth, but by a contradiction, what neither Plato, nor Rousseau, nor any ancient or modern publicist has thought possible,-- equality of conditions and fortunes.

Prometheus is by turns husbandman, wine-grower, baker, weaver.

Whatever trade he works at, laboring only for himself, he buys what he consumes (his products) with one and the same money (his products), whose unit of measurement is necessarily his day's work. It is true that labor itself is liable to vary; Prometheus is not always in the same condition, and from one moment to another his enthusiasm, his fruitfulness, rises and falls. But, like everything that is subject to variation, labor has its average, which justifies us in saying that, on the whole, day's work pays for day's work, neither more nor less. It is quite true that, if we compare the products of a certain period of social life with those of another, the hundred millionth day's work of the human race will show a result incomparably superior to that of the first; but it must be remembered also that the life of the collective being can no more be divided than that of the individual; that, though the days may not resemble each other, they are indissolubly united, and that in the sum total of existence pain and pleasure are common to them. If, then, the tailor, for rendering the value of a day's work, consumes ten times the product of the day's work of the weaver, it is as if the weaver gave ten days of his life for one day of the tailor's.

This is exactly what happens when a peasant pays twelve francs to a lawyer for a doc.u.ment which it takes him an hour to prepare; and this inequality, this iniquity in exchanges, is the most potent cause of misery that the socialists have unveiled,--as the economists confess in secret while awaiting a sign from the master that shall permit them to acknowledge it openly.