The Accumulation Of Capital Part 20

These thrusts, obviously aimed at Sismondi, exhibit quite fundamental differences between the two opponents. If Engels then says in his _Anti-Duehring_ that Sismondi first explained the crises as resulting from under-consumption, and that Rodbertus borrowed this view from him, he is not strictly accurate. All that Rodbertus and Sismondi have in common is their opposition against the cla.s.sical school and the general explanation of crises as the result of the distribution of incomes. Even in this connection Rodbertus mounts his own particular hobby horse: over-production is not caused by the low level of working cla.s.s incomes, nor yet, as Sismondi maintains, by the capitalists' limited capacity for consumption, but solely by the fact that with a growing productivity of labour, the workers' income, in terms of value, represents an ever smaller share of the product. Rodbertus takes pains to convince the opposition that it is not the small volume of the workers' share which causes the crises.

'Just imagine', he goes on to lecture v. Kirchmann, 'these shares to be so small as to ensure only a bare subsistence for those who are ent.i.tled to them. As long as you establish them as representing a proportion of the national product, you will have a constant "vessel for value" which can absorb ever increasing contents, and an ever increasing prosperity of the working cla.s.ses as well.... And now imagine on the contrary as large a share for the working cla.s.ses as you please, and let it become an ever smaller fraction of the national product that grows with increasing productivity. Then, provided it is not reduced to the present pittance, this share will still protect the workers from undue privations since the amount of products it represents will still be considerably greater than it is to-day. Once this share begins to decline, however, there will be spreading discontent, culminating in a commercial crisis for which the capitalists are not to blame inasmuch as they did no more than their duty in laying down the volume of production according to the given magnitude of these shares.'

That is why the 'declining wage rate' is the real cause of crises. It can only be counteracted by legal measures to ensure that the workers'

share represents a stable and unchanging rate of the national product.

This grotesque notion takes some understanding if we are to do justice to its economic implications.

FOOTNOTES:

[237] To v. Kirchmann, in 1880.

[238] Dr. Carl Rodbertus-Jagetzow, _Schriften_ (Berlin, 1899), vol. iii, pp. 172-4, 184.

[239] Op. cit., vol. ii, pp. 104 f.

[240] Op. cit., vol. i, p. 99.

[241] Ibid., p. 173.

[242] Ibid., p. 176.

[243] Op. cit., vol. ii, p. 65.

[244] _Schriften_, vol. i, pp. 182-4.

[245] Ibid., pp. 182-4.

[246] Ibid., p. 72.

[247] _Schriften_, vol. iii, pp. 110-11.

[248] Ibid., p. 108.

[249] Op. cit., vol. i, p. 62.

[250] _Schriften_, vol. iv, p. 226.

[251] In _Towards the Understanding of Our Politico-Economic Conditions_, part ii, n. 1.

[252] In _On Commercial Crises and the Mortgage Problem of the Landowners_, quoted above (op. cit., vol. iii, p. 186).

[253] Op. cit., vol. iv, p. 233. It is interesting to note in this connection how Rodbertus appears in practice as an extremely sober and realistically-minded prophet of capitalist colonial policy, in the manner of the present-day 'Pan-Germans', his moral ranting about the unhappy fate of the working cla.s.ses notwithstanding. In a footnote to the above quotation, he writes: 'We can go on to glance briefly at the importance of the opening up of Asia, in particular of China and j.a.pan, the richest markets in the world, and also of the maintenance of English rule in India. It is to defer the solution of the social problem.' (The eloquent avenger of the exploited ingenuously discloses the means by which the profiteering exploiters can continue 'their stupid and criminal error', their 'flagrant injustice' for as long as possible.) 'For the solution of this problem, the present lacks in unselfishness and moral resolution no less than in intelligence.' (Rodbertus'

philosophical resignation is unparalleled!) 'Economic advantage cannot, admittedly, const.i.tute a legal t.i.tle to intervention by force, but on the other hand, a strict application of modern natural and international law to all the nations of the world, whatever their state of civilisation, is quite impracticable.' (A comparison with Dorine's words in Moliere's _Tartuffe_ is irresistible: 'Le ciel defend, de vraie, certains contentements, mais il y a avec lui des accommodements.')--'Our international law has grown from a civilisation of _Christian_ ethics, and since all law is based upon reciprocity, it can only provide the standard for relations between nations of the same civilisation. If it is applied beyond these limits, it is sentiment rather than natural and international law and the Indian atrocities should have cured us of it.

Christian Europe should rather partake of the spirit which made the Greeks and the Romans regard all the other peoples of the world as barbarians. The younger European nations might then regain the drive for making world history which impelled the Ancients to spread their native civilisation over the countries of the globe. They would reconquer Asia for world history by _joint action_. Such common purpose and action would in turn stimulate the greatest social progress, a firm foundation of peace in Europe, a reduction of armies, a colonisation of Asia in the ancient Roman style--in other words, a genuine solidarity of interests in all walks of social life.' The vision of capitalist colonial expansion inspires the prophet of the exploited and oppressed to almost poetical flights, all the more remarkable for coming at a time when a civilisation of Christian ethics accomplished such glorious exploits as the Opium Wars against China and the Indian atrocities--that is to say, the atrocities committed by the British in their b.l.o.o.d.y suppression of the Indian Mutiny.--In his second _Letter on Social Problems_, in 1850, Rodbertus had expressed the conviction that if society lacks the 'moral resolution' necessary to solve the social question, in other words, to change the distribution of wealth, history would be forced to 'use the whip of revolution against it' (op. cit., vol. ii, p. 83). Eight years later, however, the stalwart Prussian prefers to crack the whip of a colonial policy of Christian ethics over the natives of the colonial countries. It is, of course, what one might expect of the 'original founder of scientific socialism in Germany' that he should also be a warm supporter of militarism, and his phrase about the 'reduction of armies' is but poetic licence in his verbal fireworks. In his essay _On the Understanding of the Social Question_ he explains that the 'entire national tax burden is perpetually gravitating towards the bottom, sometimes in form of higher prices for wage goods, and sometimes in form of lower money wages'. In this connection, he considers conscription 'under the aspect of a charge on the state', explaining that 'as far as the working cla.s.ses are concerned, it is nothing like a tax but rather a confiscation of their entire income for many years'. He adds immediately: 'To avoid misunderstanding I would point out that I am a staunch supporter of our present military const.i.tution (i.e. the military const.i.tution of counter-revolutionary Prussia)--although it may be oppressive to the working cla.s.ses and demand great financial sacrifices from the propertied cla.s.ses' (op. cit., vol. iii, p. 34).

That does not even sound like a lion's roar!

[254] _Schriften_, vol. iii, p. 182.

[255] Published already in 1845.

[256] _Schriften_, vol. iv, p. 231.

_CHAPTER XVII_

RODBERTUS' a.n.a.lYSIS OF REPRODUCTION

To begin with, what does it mean that a decrease in the workers' share is bound immediately to engender over-production and commercial crises?

Such a view can only make sense provided Rodbertus takes the 'national product' to consist of two parts, _vide_ the shares of the workers and of the capitalists, in short of _v + s_, one share being exchangeable for the other. And that is more or less what he actually seems to say on occasions, e.g. in his first _Letter on Social Problems_:

'The poverty of the working cla.s.ses precludes their income from giving scope to increasing production. The additional amount of products from the entrepreneurs' point of view lowers the value of the aggregate product so far as to bar production on the former scale, leaving the workers at best to their accustomed straits, though, if it could be made available to the workers, it would not only improve their lot but would further act as a counterweight by increasing the value of what is retained by the capitalists (and so enable the latter to keep their enterprises at the same level).'[257]

The 'counterweight' which in the hand of the workers increases the 'value' of 'what is retained' by the entrepreneurs, can in this context only be the demand. Once again, we have landed happily at the familiar _Ort_ of v. Kirchmann's where workers and capitalists exchange their incomes for the surplus product, and where the crises arise because variable capital is small and the surplus value large. This peculiar notion has already been dealt with above. There are other occasions, however, when Rodbertus advances a somewhat different conception. The interpretation of his theory in the fourth _Letter on Social Problems_ is that the continual shifts in the relations of demand, evident in the share of the working cla.s.s and caused by the share of the capitalist cla.s.s, must result in a chronic disproportion between production and consumption.

'What if the entrepreneurs endeavour to keep always within the limits of those shares, yet the shares themselves are all the time on the decline for the great majority of the society, the workers, decreasing gradually, unnoticeably, but with relentless force?--What if the share of these cla.s.ses is continually decreasing to the same extent as their productivity is increasing?'--'Is it not really the fact that the capitalists of necessity organise production in accordance with the present volume of shares in order to make wealth universal, and that yet they always produce over and above this volume (of previous shares), thereby perpetuating dissatisfaction which culminates in this stagnation of trade?'[258]

On this showing, the explanation of crises should be as follows: the national product consists of a number of 'common goods', as v. Kirchmann puts it, for the workers, and of superior goods for the capitalists. The wages represent the quant.i.ty of the former, and aggregate surplus value that of the latter. If the capitalists organise their production on this footing, and if at the same time there is progressive productivity, a lack of proportion will immediately ensue. For the share of the workers to-day is no longer that of yesterday, but less. If the demand for 'common goods' had involved, say, six-sevenths of the national product yesterday, then to-day it involves only five-sevenths, and the entrepreneurs, having provided for six-sevenths of 'common goods', will find to their painful surprise that they over-produced by one-seventh.

Now, wiser by this experience, they try to organise to-morrow's output of 'common goods' to a mere five-sevenths of the total value of the national product, but they have a new disappointment coming to them, since the share of the national product falling to wages to-morrow is bound to be only four-sevenths, and so on.

In this ingenious theory there are quite a few points to make us wonder.

If our commercial crises are entirely due to the fact that the workers'

'wage rate', the variable capital, represents a constantly diminishing portion of the total value of the national product, then this unfortunate law brings with it the cure for the evil it has caused, since it must be an ever smaller part of the aggregate product for which there is over-production. Although Rodbertus delights in such terms as 'an overwhelming majority', 'the large popular ma.s.ses' of consumers, it is not the number of heads that make up the demand, but the value they represent which is relevant. This value, if Rodbertus is to be believed, forms a more and more trifling part of the aggregate product. Crises are thus made to rest on an ever narrowing economic basis, and all that remains to discover is how in spite of it all it can still happen that the crises are universal and increasingly severe besides, as Rodbertus is fully aware. The purchasing power lost by the working cla.s.ses should be gained by the capitalist cla.s.s; if _v_ decreases, _s_ must grow larger to make up for it. On this crude scheme, the purchasing power of society as a whole cannot change, as Rodbertus says in so many words: 'I know very well that what is taken from the workers' share goes ultimately to swell that of the "rentiers" (rent and surplus value are used as synonyms, _R.L._), and that purchasing power remains constant on the whole and in the long run. But as far as the product on the market is concerned, the crisis always sets in before this increase can make itself felt.'[259]

In short, the most it can amount to is that there is 'too much' of 'common goods' and 'too little' of superior goods for the capitalists.

Quite unawares, and by devious ways, Rodbertus here falls in with the Say-Ricardian theory he so ardently contested, the theory that over-production on one side always corresponds to under-production on the other. Seeing that the ratio of the two shares is persistently shifting to the advantage of the capitalists, our commercial crises might be expected on the whole to take on increasingly the character of periodical under- instead of over-production! Enough of this exercise in logic. The upshot of it all is that Rodbertus conceives the national product in respect of its value as made up of two parts only, of _s_ and _v_, thus wholly subscribing to the views and traditions of the cla.s.sical school he is fighting tooth and nail, and even adding his own flourish that the capitalists consume the entire surplus value. That is why he repeatedly says without mincing his words, as in the fourth _Letter on Social Problems_:

'Accordingly, we must abstract from the reasons which cause the division of rent in general into rent proper and capital rent, to find the basic principle underlying the division of rent (surplus value) in general, the principle underlying _the division of the labour product into wage and rent_.'[260] And, in the third _Letter_: 'Ground rent, capital profit and the wage of labour are, let me repeat, revenue. By this means landlords, capitalists and workers must live, must satisfy, that is to say, their immediate human necessities. They must therefore draw their income in the form of goods suitable for this purpose.'[261]

The misrepresentation of capitalist economy has never been formulated more crudely, and there is no doubt that Rodbertus claims the palm of 'priority'--not so much over Marx as over all popular economists--with full justification. To leave the reader in no doubt about the utter muddle he has made, he goes on, in the same letter, to rank capitalist surplus value as an economic category on the same level as the revenue of the ancient slave-owner:

'The first state (that of slavery) goes with the most primitive natural economy: that portion of the labour product which is withheld from the income of workers or slaves and forms the master's or owner's property, will undividedly accrue to the one man who owns the land, the capital, the worker and the labour product; there is not even a distinction of thought between rent and capital profits.--The second state entails the most complicated money economy: that portion of the labour product, withheld from the income of the now emanc.i.p.ated workers, and accruing to the respective owners of land, and capital, will be further divided among the owners of the raw material and the manufactured product respectively; the one rent of the former state will be split up into ground rent and capital profits, and will have to be differentiated accordingly.'[262]

Rodbertus regards the splitting-up of the surplus value 'withheld' from the workers' 'income' as the most striking difference between exploitation by slavery and modern capitalist exploitation. It is not the specific historical form of sharing out newly created value among labour and capital, but the distribution of the surplus value among the various people it benefits, which, irrelevant to the productive process, is yet the decisive fact in the capitalist mode of production. In all other respects, capitalist surplus value remains just the same as the old 'single rent' of the slave-owner: a private fund for the exploiter's own consumption!

Yet Rodbertus again contradicts himself in other places, remembering all of a sudden the constant capital and the necessity for its renewal in the reproductive process. Thus, instead of bisecting the aggregate product into _v_ and _s_, he posits a triple division: _c_, _v_, and _s_. In his third _Letter on Social Problems_ he argues on the forms of reproduction in a slave-economy:

'Since the master will see to it that part of the slave labour is employed in maintaining or even improving the fields, herds, agricultural and manufacturing tools, there will be "capital replacement", to use a modern term, in which part of the national economic product is immediately used for the upkeep of the estate, without any mediation by exchange or even by exchange value.'[263] And, pa.s.sing on to capitalist reproduction, he continues: 'Now, in terms of value, one portion of the labour product, is used or set aside for the maintenance of the estate, for "capital replacement", another, for the workers' subsistence as their money wage; and the owners of the land, of capital, and of the labour product retain the last as their revenue or rent.'[264]

This, then, is an explicit expression of the triple division into constant capital, variable capital, and surplus value. Again, in this third _Letter_, he formulates the peculiarity of his 'new' theory with equal precision: 'On this theory, then, and under conditions of adequate labour productivity, the portion of the product which remains for wages after the replacement of capital, will be distributed among workers and owners as wages and rent, on the basis of the ownership in land and capital.'[265]

It does seem now as if Rodbertus' a.n.a.lysis of the value of the aggregate product represents a distinct advance over the cla.s.sical school. Even Adam Smith's 'dogma' is openly criticised a little further on, and it is really surprising that Rodbertus' learned admirers, Messrs. Wagner, Dietzel, Diehl & Co. failed to claim their white-headed boy's 'priority'

over Marx on such an important point of economic theory. As a matter of fact, in this respect no less than in the general theory of value, Rodbertus' priority is of a somewhat dubious character. If he seems on occasion to gain true insight, it immediately turns out to be a misunderstanding, or at best a wrong approach. His criticism of Adam Smith's dogma affords a supreme example of his failure to cope with the triple division of the national product towards which he had groped his way. He says literally:

'You know that all economists since Adam Smith already divided the value of the product into wage of labour, rent, and capital profit, that it is therefore not a new idea to ground the incomes of the various cla.s.ses, and especially the various items of the rent, in a division of the product. But the economists at once go off the track. All of them, not even excepting Ricardo's school, make the mistake, first, not to recognise that the aggregate product, the finished good, the national product as a whole, is an ent.i.ty in which workers, landowners, and capitalists all share, but conceiving the division of the unfinished product to be of one kind shared among three partners, and that of the manufactured product as of another kind again, shared between only two partners. For these theories both the unfinished product and the manufactured product const.i.tute as such separate items of revenue.

Secondly,--though both Sismondi and Ricardo are free from this particular error--they regard the natural fact that labour cannot produce goods without material help, i.e. without the land, as an economic fact, and take the social fact for a primary datum that capital as understood to-day is required by the division of labour. Thus they set up the fiction of a fundamental economic relationship on which they base also for the shares of the various owners, ground rent springing from the contribution of the land lent by the owner to production, capital profits from the contribution of capital employed by the capitalist to this end, and the wages finally from labour's contribution, seeing that there are separate owners of land, capital, and labour in the society. Say's school, elaborating on this mistake with much ingenuity, even invented the concept of productive service of land, capital, and labour in conformity with the shares in the product of their respective owners, so as to explain these shares as the result of productive service.--Thirdly, they are caught up in the ultimate folly of deriving the wage of labour and the items of rent from the value of the product, the value of the product in turn being derived from the wage of labour and the items of rent, so that the one is made to depend on the other and _vice versa_. This absurdity is quite unmistakable when some of these authors attempt to expound "The Influence of Rent Upon Production Prices" and "The Influence of Production Prices Upon Rent" in two consecutive chapters.'[266]