This Month's Quotation: Socialist (1934)

The Front Page quote from the July 1934 issue of the Socialist Standard

"Socialism is a new system of Society, not a change of rulers. Administration of Capitalism by a Labour Government is not Socialism."

The Reaction in Europe and the S.P.G.B. (1934)

From the July 1934 issue of the Socialist Standard

Observers of political events since 1918 cannot fail to have noticed the change that has come over the general tone and attitude of the various so- called “left” elements among the workers. For the first few years after the war these elements were jubilantly proclaiming the imminence of the end of the present social order upon the strength of a few beggarly political and other reforms on the Continent. Because sections of the ruling-class lost their grip of things in the defeated countries (giving way to others who were prepared to provide safety-valves for working class discontent and place certain belated limits on their exploitation) we were asked to believe that our masters were at the end of their tether and would be surrendering the earth in a few short years.

Now we are asked to believe a very different story by these self-same elements. In their eyes now there are no limits to the powers of the master-class to impose what is commonly termed Fascism and to interfere with the general development of the working-class. Why? Because, forsooth, these reforms are being filched from the workers within a few years of being won. To crown all, instead of realising the futility of reform policies, these elements proclaim ever more loudly the need for still bigger and better reforms.

What is the attitude of the S.P.G.B. towards this change of front on the part of such bodies as the Communist Party and I.L.P. ? Briefly, it is to maintain unchanged our hostility to these bodies and to demonstrate that the capitalist system remains essentially unchanged, in spite of the manifold forms assumed by the different national States which uphold it.

Having had experience of partial suppression during the War, we are far from holding that it is a matter of indifference to the workers whether they are allowed political expression or not. The Socialist movement, which is the supreme expression of their needs, cannot arrive at maturity under conditions of political reaction. In Engels' phrase, the Socialist movement needs elbow-room.

Experience shows, however, that reform organisations, no matter how numerous their members and supporters may be, cannot guarantee to the workers these essential political conditions of development. So far from their being able to check reaction their inability when they become the Government to solve the economic problem, has provided reaction with its greatest political stimulus. Helpless before the economic blizzard, they are equally helpless in the face of its political reflexion.

The progress of scientific organisation under capitalism results in the weeding out of the smaller capitalists and, as a result, anti-scientific notions, such as Fascism, readily find acceptance among such groups during a period of economic depression.

Socialism alone can free the productive forces from restrictions imposed upon them by different sections of the capitalist class. In the meantime, these sections strive each to impose the amount and kind of restriction suited to its own interest. The small capitalists, faced with impending bankruptcy, strive to hamper the large-scale concerns, but neither Hitler nor Mussolini has discovered how to save these obsolete little “captains of industry." The big fish continue to swallow up the little fish.

Every national State, no matter how it may describe itself, endeavours to utilise science to the maximum degree in perfecting its instruments of aggression and defence. Hence, for this reason, if for no other, it encourages the development of large-scale industry, which alone can provide these instruments. This applies equally to Bolshevist Russia, Fascist Italy and Nazi Germany—and to Britain, whether under “Labour” or "National” Governments. Large-scale industry progresses, in its turn, upon the ruins of small-scale industry.

This results in the development of the working-class, i.e., in the increase of its numbers, and in the growth of its organisation upon the industrial field. The intensity and scope of the class-struggle increase simultaneously.

The “dictators," Fascist and Bolshevist alike, attempt to repress this struggle by suppressing all political parties save one. The result is that discontented elements find their way into the one legal party, and are a constant menace to its unity. The “Dictator” preserves his authority over the different factions among his followers by avoiding going too far in any one direction. Hitler and Mussolini, Stalin and Pilsudski owe their positions to compromise just as surely as does Ramsay MacDonald, or any other Parliamentary politician.

In Britain, however, the capitalist class has long ago learned how to sink its internal struggles in critical moments, as a result of its more advanced economic development. It finds its solution, not in dictatorships, but in Coalitions or “National” Governments. The essential compromise is achieved by less violent means.

Under such conditions Fascists, so-called, are as little likely as Communists to become anything more than a thorn in the side of some larger party. Just as the Communists imported Russian jargon, but were utterly unable to bring over Russian conditions along with it, so the British Fascists will find that the novelty of teaching their political grandmothers to suck eggs will soon wear off. It is not necessary to credit Baldwin and Company with supernatural sagacity in order to anticipate that they will always be at least one move ahead of Sir Oswald Mosley.

The followers of this volatile politician may conceivably eclipse the Communists and I.L.P., but Socialists need not get excited about that. If the workers are still in the dark as to the direction to take, these latter bodies must accept a large measure of responsibility. They have induced the workers to support policies for which there was no chance of success. Disillusionment and apathy have, therefore, provided the material from which Mosley may build up a temporary alternative movement.

The S.P.G.B. is not a party of prophets, but whatever the immediate future may hold, we see no reason to deviate from the policy consistently pursued by us for thirty years. Just as we refused to be duped by Moscow, so we decline to be scared by what is happening in other Continental centres.

We realise that the master-class of this country possess means of intimidation as formidable as any that exist. We also realise that they control them through the support which they receive from the non-Socialist members of our class. By all means in our power, therefore, we strive to make Socialists.

Eric Boden

Blogger's Note:

See also the editorial, 'Reason or Violence', from this month's Socialist Standard.

State Banking in Australia (1934)

From the July 1934 issue of the Socialist Standard

Another Quack Remedy 

In the Glasgow Forward (October 21st, 1933), Tom Johnston takes G. D. H. Cole to task for omitting to mention the results of State banking in Australia in his recently published work, “What Everybody wants to know about Money."

As Mr. Johnston seems highly incensed at this omission one would expect that he would have supplied the deficiency and would have tried to show what good things State banking has achieved for the workers of Australia. But Tom deserves the carrot for modesty, for he does not even attempt it. For the benefit of those workers who are always being lulled to political sleep by references to Australia's magnificent “socialistic" examples, let us speak for ourselves. First let us give a few facts.

The biggest State-controlled Bank in Australia is the Commonwealth Bank. It was established in 1911 and has been a profitable concern for the Government ever since. Up to the 20th anniversary the aggregate profits were: —

General Bank  . . .        . . . £6,943,942 11 9

Savings Bank  . . .        . . .   2,781,995 19 9

Rural Bank  . . .        . . .      328,078 11 2

    Total                              £10,054,017    2    8

These figures are exclusive of the note issue branch. These profits have been distributed as follows: — 

To Capital Account       . . .  £4,000,000 0 0

Reserve Fund . . .   . . .            1,406,580 13 3

Rural Bank Reserve . . . 164,039 5 7

Savings Bank Reserve . . . 658,382 3 10

National Debt Sinking Fund 2,660,975 14 5

      Total                                 £10,054,017       2    8

These figures are from the Commomuealth Year Book and Labor Daily Year Book. They show that nearly one-third of the profits went into the National Debt Sinking Fund.

A common claim made on behalf of the Bank is that the profits go to lighten the “people’s burden" by helping wipe off the National Debt. But that is the crux of the whole matter, how does wiping off the National Debt help the workers. Reducing the National Debt reduces the amount of interest payable to bondholders, and thus enables the Government to reduce taxation. Reduced taxation, however, does not help the workers, but only the propertied class. What the workers get is their wages. If, owing to reduced taxation, the workers' cost of living is reduced, their pay is reduced likewise. It is on that rock that all the reformist schemes for bettering the workers’ condition under Capitalism are wrecked. As a prominent advocate of debt reduction by means of a capital levy (Mr. Pethick Lawrence) once admitted, it was merely a redistribution of wealth among the wealthy only.

If therefore State banking is a success it is as an adjunct of Capitalism. According to Senator Barnes, Labour Party, “The Commonwealth Bank has made a profit of 31 million pounds since its establishment." (Melbourne Herald, February 5th, 1934.) In the book of the Commonwealth Bank (an official publication by C. C. Fawkner) we are told that “The bank's policy was not to enter into aggressive competition with the existing financial institutions, and this was shown by determining the rates of interest on fixed deposits at ½  per cent. below those quoted by the leading trading banks." (p. 42.) And so that our masters could facilitate their business, “the rate fixed (for overdrafts) by the Commonwealth Bank had a marked effect in keeping down interest rates, to the benefit of the commercial mid business community throughout Australia." (p. 42.)

Some of the chief functions performed by the Commonwealth Bank have been Raising War Loans, Financing Naval Projects, Building Railways, Financing War Expenditure, Financing Pools for wheat, wool, etc.

Bank Loans to House Purchasers

One of the main functions of the State Savings Bank (Victoria) was the financing of home-building under what is known as the Credit Foncier system. Under the_Act of 1920, authority is given to the Commissioners to purchase and build houses for persons who have an income of not more than £400 per annum, and who do not own a house. The limit is, if the house be of wood, £1,000, and of brick, stone, or concrete, £ 1,300.

The interest charged was 6¼ per cent., and the terms of payment allowed for the paying off of the house in 26 years. The funds for this branch of the Bank's operations were raised by the issue of Credit Foncier Debentures, which were guaranteed by the Government of Victoria.

The net profit for the year 1928-29 was £34,032, and for 1929-30, £24,591. These profits are allocated for the purpose of meeting any losses that may occur. Savings Bank debentures pay 5¼ per cent. (1940) and 4½ per cent. (1936). The interest on these debentures comes out of the 6¼ per cent. paid by the workers who are purchasing their homes, and should this source fail, the Government foots the bill.

“Of the 46,100 loans in the Credit Foncier Department 58 securities were in the possession of the Bank at June 30th, 1930, on which the indebtedness was £34,183. To September 11th, 1930, 22 of these had been sold, reducing the number to 36 and the amount to £19,847. During the year, 86 properties were sold for £65,876, and resulted in a small loss (£1,412), but an amount of £1,162 which had been written off in former years, was recovered.” (Victorian Year Book, 1929-30.)

As the depression became worse, the number of houses reverting to the banks owing to the inability of the purchasers to keep up their payment increased rapidly. In 1930-31 the number in possession of the Bank at June, 1931, was 315, about seven out of every 1,000.

So great did the number of reversions to the Bank become that the figures were conveniently concealed from the public by not being published in the annual reports; Some idea of the huge increase can be gained when it is learned that a separate department was set up in the Bank to cope with it. Besides, owing to the inability of the Bank to dispose of many of the re-possessed houses, it was deemed wiser to leave the tenants in charge rather than risk the deterioration which accompanies an untenanted dwelling. Inquiries at the Bank reveal a reticent attitude with regard to particulars pertaining to this side of its activities.

In South Australia a similar position obtained.

Just prior to the depression the Board of Management of the State Bank of South Australia reported "that for the year ended June 30th, 1928, 106 houses reverted to the Bank through tenants being unable to continue payments or through their vacating premises because of inability to pay. The properties are now being sold by the Bank. The number of reverted properties for the previous year was 78.” The position in South Australia is said to be even worse than Victoria! !

In New South Wales, owing to political tactics by both State Labour Government and Federal Nationalist Government, the State Savings Bank had to close its doors altogether, and the business was taken over by the Commonwealth Bank. Pending an agreement being arrived at as to the terms of taking over, many depositors were forced on to the dole.

The foregoing facts could have been easily obtained by Mr. Johnston had he any desire to show some of the “results of the State Banks in Australia.” Mr. Johnston has a lot to learn about State Banking in so far as it affects the working class.

Let us ask Mr. Johnston a few questions. .

In what way do the floating of war loans, the financing of wheat pools, the building of State Railways, and the granting of big overdrafts at low rates of interest, improve the position of the working class ?

How much better off are those workers who began to purchase homes under the Credit Foncier System only to lose them (as they would have, had they bought them off private institutions), when the depression deprived them of their jobs?

Is not the. abolition of the Capitalist system and all its appendages more in keeping with working-class interests, and would not the Johnstons, the Coles, and others of their ilk, be better occupied in helping to establish Socialism? We know that the whole Capitalist system, including the banking system, has got to go before the workers come into their own. And with all due modesty we say to Mr. Johnston, "It's never too late to learn.”

W. J. Clarke

(Socialist Party of Australia.)

SPGB Open Air Meetings (1934)

Party News from the July 1934 issue of the Socialist Standard

Blogger's Note:

Interesting that Hyde Park isn't listed. I guess it was just taken as read that the Party would always have speakers there.

As mentioned previously on the blog, I really wish I could include all the speakers listed in the label section but it's just not doable. Outdoor speaking was so central to the Party's activity and identity in the first fifty years of its history that it's unfortunate that it cannot be properly represented on the blog. Looking at the names listed, here's a wee bit info about some of the speakers listed:

• Tony Turner: The pre-eminent SPGB outdoor speaker for twenty plus years. Originally joined the Southwark Branch of the SPGB in July 1931. Resigned in April 1955 over the Forum dispute. His obituary appeared in the April 1992 issue of the Socialist Standard. He appears on the front cover of the June 2004 centenary issue of the Socialist Standard.
• Gilbert Manion: A former member of the Social Democratic Federation, Manion originally joined the SPGB in November 1928 and was a member of the Party on three separate occasions between 1928 and 1953. Originally a member of the Camberwell Branch of the SPGB he was also a member of Hackney Branch. He was still a member of the Party when he died in 1953. There was no obituary for him in the Standard.
• Jimmy Banks: A member of Battersea Branch, he joined the SPGB in May 1915 and was still a member of the Party  when he died in December 1966. A class conscious objector during the first World War, he was sent to Dartmoor Prison for his principles. Sadly his obituary from the February 1967  issue of the Socialist Standard is brief to the point of ridiculousness for someone who was an active socialist for over 50 years.
• Henry Russell: The Russell listed amongst the speakers was probably Henry Russell. Joining Southwark Branch of the SPGB in September 1933 he was a member of the Party until his membership was lapsed in November 1952.
• Bob Ambridge: One of the mainstay members in the history of the SPGB, Bob Ambridge joined the Battersea Branch of the Party in September 1927 and was a member of Swansea Branch when he died in February 1980. His obituary appeared in the April 1980 issue of the Socialist Standard.
• Claud Godfrey: Sadly, another longstanding member with an all too scant obituary in the pages of the Socialist Standard (April 1972 issue). Godfrey originally joined Tottenham Branch of the Party in July 1926, and was a member of Haringey Branch when he died.
• Jack Butler: Another stalwart member of the SPGB, joined West Ham Branch of the Parry in 1910 and served the Party both as a speaker and as a behind the scenes member. At the time of his premature death in 1944, he had been the Party Treasurer for 20 years. 'Gilmac' (Gilbert McClatchie) wrote a warm and personal obituary for Jack Butler in the September 1944 issue of the Socialist Standard. 
• R. Innes: A member of East London Branch of the SPGB, joining the Party in September 1931.
• F. Wiltshire: There were two 'F. Wiltshires' in the SPGB. A F. Wiltshire Sr and a F. Wiltshire Jr. This was probably F. Wiltshire Sr, who originally joined the Islington Branch of the SPGB in April 1911. He was to join and rejoin the Party three or four times over the course of forty years.
• Nathan Isbitsky: Joined the East London Branch of the SPGB in July 1930. He's briefly mentioned in Barltrop's The Monument, but there is no record of when he left/resigned from the SPGB.
• Sid Rubin: Another member who joined the Party via East London Branch. He joined the Party in July 1931 and was an incredibly prolific speaker and writer through the 1930s and 1940s, until he had to resign his membership in April 1949 as he was moving abroad. As 'George Camden', he wrote the novel 'My Time, My Life'.

An Engineer in Blunderland (1934)

Book Review from the July 1934 issue of the Socialist Standard

The Great God Waste, by Mr. John Hodgson (published by the author at Eggington, Beds., 1933, 127 pages, price 2s. 9d.), is a thoroughly bad book, the effect of which is likely to be the spreading of a vast amount of confusion. It is packed with snippets of information, most of them containing more or less of the truth, but used in a most unscientific way to back up a case which will not stand serious examination. The apparent reliability of the details is likely to deceive the uninstructed reader into accepting the false conclusions without examining them any more critically than the author has done.

He describes himself as a “Scientific Engineer" (his capitals), and claims to have evidence of truly stupendous unused or wasted productive powers which can only be released by adopting a currency scheme which he outlines. He sees more or less eye-to-eye with Major Douglas and the American Technocrats —who are also, be it noted, engineers who have lost their way through superficial dabbling with economic problems.

The essence of his scheme is the same as Major Douglas’s, i.e., that “ purchasing power be distributed as a gift . . . to consumers" (page 49). It is based, of course, on the familiar fallacy that there is an absolute deficiency of purchasing power (i.e., less “ purchasing power " than there are goods). The idea is that this free distribution will raise the total of purchasing power to a level at which it equals the total of goods, thus enabling production to be increased to any desired level up to the maximum capacity of industry.

Mr. Hodgson is not opposed to capitalism, but only to what he vaguely describes as “Money Power.” For him, as for Major Douglas, the non-banking capitalist only wishes to serve the community “and to produce work that will be worthy of his reputation irrespective of the question as to whether he makes a money profit or not ” (page 32). Unfortunately, however, the wicked banker steps in and will not allow the industrial capitalist to “indulge this instinct.” Of course this is a purely mythical capitalist. The real industrial capitalist is not, as Mr. Hodgson imagines he is, a “craftsman,” except where an odd one is, quite incidentally. He is an investor or is in business primarily to make a profit, and he is willing to lay out his money in any direction, banking, brewing, armaments or anything else, provided that there is the prospect of profit. That is the capitalist system, and Mr. Hodgson's dream world (or nightmare world) is only faintly connected with the reality.

One flaw in his scheme can be seen from his statement, on page 45, that what we need in order to rid ourselves of our present ills is to go back to “the days of the banks of private issue” when “credit power” was “widely diffused throughout the community.” As we are told on page 29 that the banks of private issue were suppressed by the Bank Charter Act of 1844, this means taking us back to the piping days before 1844. Does Mr. Hodgson then believe that the poverty problem, insecurity, unemployment, foreign investments, commercial wars, etc., have all come into existence only since 1844? Engel's ”Condition of the Working Class in 1844 ” should enlighten him.

The main weakness of the whole argument contained in the book is that the figures used to show a stupendous increase in the productivity of industry are worthless; and as the whole case depends on them, it falls with them. A typical instance of this “Scientific Engineer's” slovenly methods is given on page 101. He says: —

  “The modern industrial efficiencies are exemplified by . . . brick-making plants which enable one man to produce many thousands of bricks a day.” (Italics his.)

This statement may appear to convey a precise meaning to Mr. Hodgson’s superficial view, but actually it tells us nothing at all about productivity because it does not tell us anything about the number of men needed to produce and maintain the plant. To give an obvious example, a changeover from ten men making 1,000 bricks a day by some laborious hand method, to a system by which one man operates a complicated plant also turning out 1,000 bricks a day, would only represent an increase in productivity if the plant itself, during its lifetime, required for its construction, operation, maintenance, etc., less than the labour of nine men on an average. The employers will be willing to introduce such a plant if they can save the labour of, say, one man out of the ten. The fact that machinery ordinarily does not increase productivity to the large extent supposed is shown by the slowness with which older methods of production are driven out. Often the margin of difference is so small that a slight fall in wages will be sufficient to check the introduction of “labour-saving” machinery. Mr. Hodgson is so busy piling up hundreds of instances of industrial development which he imagines support his case, that he has no time to examine any one of them properly. The real position is that an increase in productivity does take place, but only to a moderate extent in comparison with these fantastic guesses. Increased productivity in any industry cannot be measured by what happens in the last process only, but must take into account the whole of the processes from raw material to finished product, and must include the labour used up in the construction, operation, etc., of machinery.

The fallacy can be illustrated from another angle. From time to time figures are published showing how a boot-maker working a machine can turn out ten or more times as many boots as was possible by hand, or with a less elaborate machine, a few years earlier. These figures are assumed to prove that the productivity of the boot-making industry as a whole has been multiplied by ten, and that the amount of labour required in the making of a pair of boots has been reduced to one-tenth. One man who has swallowed this notion at a gulp is Mr. Johnston, Editor of Forward. He is a supporter of the Co-operative Movement. If the Co-operative Movement and other boot manufacturers can now produce boots with one-tenth or less of the labour required, say, ten years ago, why are they still selling boots at prices which are not much less than formerly? Why are not boots being sold at 2s. a pair.

The same holds good for all the other articles they make and sell and for which a vast increase in productivity has been claimed. (If there had been a vast increase in the productivity of gold-mining this would extricate them from their dilemma, but no such increase is even claimed.)

Mr. Hodgson supplies a still better illustration of his own fallacy. He says that he is engaged in engineering processes the effect of which is to displace labour, and he calculates that he alone has put 20,000 people into unemployment (page 13). He also tells us (page 8) that he is “only one worker, and quite a small worker at that, out of many workers in a world-wide field of endeavour which has for its objective the reduction of industrial waste.”

Now, if Mr. Hodgson, who is “quite a small worker” in this field, can put 20,000 men out of work, some of his engineering colleagues who are really good at their job can no doubt, in his opinion, claim their 50,000 or 100,000 victims. Suppose we take an average of 30,000. Then it only needs ten of them to produce 300,000 unemployed; and fifty of them will explain the whole of the 1½ million unemployed added to the unemployment register during the crisis years 1928 to 1932. So far so good. Mr. Hodgson and forty-nine colleagues are sufficient to explain the whole lot. But what were they up to in the years 1922 to 1928, when unemployment decreased by a million? Were they asleep? And what have they been doing during the past twelve months, during which the number of insured workers in employment is estimated to have increased by over 600,000? Mr. Hodgson has not even begun to understand capitalism and its crises.

His book does nothing to support his view that “specialists” and "experts" are better fitted than other people to handle the poverty problem. On the contrary, it is to be hoped, for the sake of human safety, that engineers do not treat engineering problems in the sloppy, hit-or-miss fashion that so many of them employ when they write books telling us what they think about economics.

Edgar Hardcastle

Blogger's Note:

The author replies to the review in the August 1934 issue of the Socialist Standard.

Another "Life" of Marx (1934)

Book Review from the July 1934 issue of the Socialist Standard

Karl Marx: A Study in Fanaticism by E. H. Carr (Dent)

It has generally been accepted when quoting from a book—or books—containing a considerable number of letters, to give the date, number of the letter, the page and volume from which it or they are taken. This facilitates verification. The author of any book, provided he has faith in his ability to present an accurate survey of his subject, would disdain to make assertions unsupported by evidence. When an author undertakes to write a “life” of a man like Karl Marx, he should at least pay a tribute to the well-known sincerity of Marx, who always gave the source of his information, and was punctilious to the extreme. His painstaking sincerity is patent. It is well known that Eleanor Marx, in verifying the quotations in the first volume of “Capital,” was unable in only one single instance to discover the origin. Marx’s assertions were rightly always backed up by evidence. These preliminary observations are necessary because a Mr. E. H. Carr has recently written a “ life ” of Marx, published by Dent’s (“Karl Marx: A Study in Fanaticism.” 327 pages. 12/6). In this book innumerable quotations are made and attributed to Marx and others, but in no instance has Mr. Carr given page, date or volume, to indicate the origin of the quotation. No documentation whatsoever is provided to guide the reader to the source of the information. This is procedure of an ignoble character, because in the progress of the book Mr. Carr has misinterpreted not only the words of Marx, but the sense, too. He has been disingenuous and has violated the principles of good taste. His interpretations are derived—so says the writer—from the volumes recently issued and sponsored by the Marx-Engels Institute, of Moscow. These four volumes contain the original letters that passed between Marx and Engels. Most of the letters are in German, but there are numerous digressions into French, English and Italian. These volumes form the basis of Mr. Carr’s “life” of Marx.

In the book there is an unending series of quotations, but whatever the nature of these quotations, on no occasion is the specific source given to allow an opportunity for verification. In my view there can only be one reason for this policy. It is that Mr. Carr has not read the four volumes: or if he has, is totally unfamiliar with the contents. Even before one reads a word of the preface, one is confronted with a piece of false information. Opposite the title page a photograph of Marx is inset, under which appears the following note: —

From an unpublished photograph.

Actually the same photograph was published in an official work issued some time ago by the Marx- Engels Institute, of Moscow. On page 304 of his book, Mr. Carr informs the reader, when dealing with the volumes issued by the Marx-Engels Institute, that—

  The first version, the so-called Gesamtausgabe, prints the works in the languages in which they were written, and was, until March, 1933, in course of publication at Berlin. The second version is a Russian translation published at Moscow.

On page 305, Mr. Carr adds—

    In a few passages originally written in English, I have been compelled by the inaccessibility of the English originals to re-translate from German or Russian versions.

But had Mr. Carr read the Gesamtausgabe, the German original version, he would know that there was no necessity to retranslate into English, because an English passage written by either Marx or Engels—or anyone else—is retained in its original form, therefore needing no retranslation. Thus, for example, a passage of 11 words taken from a letter from Marx to Engels (line 33, letter 143, dated January 20th, 1852, on page 308 of Vol. I) appears as follows, written in German, English and French!—

   Louis kann den Louis Philippe by no means nachmachen. Et alors ?

In some letters there are additional phrases from other languages. The statement re “inaccessibility” is mere bluff and pretence, for though Mr. Carr later informs us of letters which are written in English, three of which will be specified later, in no instance has Mr. Carr given an accurate reproduction of these letters, though in the Gesamtausgabe they are printed in English..

One essential factor for a clear insight into, and an appreciation of, the correspondence between Marx and Engels, is a knowledge of its chronology and history. One must know that there have been two versions of this series of correspondence. The' previous issue was—

   Der Briefwechsel zwischen Friedrich Engels und Karl Marx. Herausgegeben von A. Bebel und Ed. Bernstein. Bd. I-IV Stuttgart, J. H. W. Dietz, 1913.

Engels made Edward Bernstein his literary executor, on whom devolved the responsibility for issuing the works of both Marx and Engels. (Engels had long begun to arrange and edit the literary works of Marx.)

Bernstein manipulated the correspondence, expunging passages at his discretion, and leaving letters entirely unmentioned. Many of the passages are momentous in the history of Marxism, as we shall see later.

That Mr. Carr makes no reference to the early version is surprising, for it appears to indicate his ignorance of its existence, and, what is more interesting, that he has not read the four volumes issued by the Marx-Engels Institute, of Moscow. All Mr. Carr's protestations are unavailing, for there are scores of instances that prove his ignorance of the letters he is supposed to have read, and upon which he has written this “biography” of Marx. Mr. Carr’s sublime silence about the two versions is interesting. If his “life” of Marx is based upon the correspondence issued by the Marx-Engels Institute, what are we to make of the mysterious fact that there are no less than 110 pages of valuable introductory material in the correspondence—yet Mr. Carr has not made the slightest reference to it!

Moreover, it is difficult to accept assurance from a "biographer" who gives neither page, date, letter, nor volume, when writing of correspondence between Marx and Engels—dating from October 8th—10th, 1844, to January 10th, 1883— in which there are no less than 1,569 letters.

Mr. Carr gives words incorrectly and inserts others not in the original version. Take page 97 of his book, for example. On this page Mr. Carr refers to the letter written by Engels to Marx announcing the death of his sweetheart, Mary Burns. Mr. Carr does not inform the reader that Engels wrote the letter on January 7th, 1863. If he had read it he would have discovered that Engels forgot the turn of the year, and inserted 1862.

Marx replied on the following day (letter 814, page 117, of Vol. 3) in a curt manner. Engels was rather upset, and, on January 13th, sent Marx a severe letter, the ONLY one of its kind that ever passed between the two friends. Let us read Mr. Carr's account. He says:—

   This “frosty” letter, received before Mary was in her grave, struck Engels dumb for four days.
   All my friends (he wrote at length), including bourgeois acquaintances. . . .

Mr. Carr puts the word "bourgeois" in italics. The word "bourgeois" is NOT in italics in the correspondence. The words are in letter 816, second paragraph, page 118, of Vol 3. They begin on line 21, and are as follows: —

   Alle meine Freunde, einschliesslich Philisterbekannte. . . .

In the Marx-Engels Institute version the words are as above. If italics had been used by Engels (or Marx), this is the way it would have been printed—P h i 1 i s t e rbekannte. 

So much for Mr. Carr's literary rectitude!!

Perhaps the survey of another episode may help in elucidating the mysteries of Mr. Carr's qualifications to write as an “authority" on Marx. On page 67, Mr. Carr indulges speculatively anent the activities of Marx in Paris, and the decision to go to England. As usual, he displays his ignorance of the correspondence, and makes statements that are the reverse of fact. In the last paragraph Mr. Carr states that the decision to emigrate was "the most important landmark in Marx's career."

If this decision is the most important landmark in Marx's career, such observation, interpretation, and justification should be sustained by evidence. But Mr. Carr tenders nothing to prove the great landmark. There are reasons for the serious omission—for Mr. Carr again evidently knows little or nothing of the correspondence of this period. His review on page 67 is deficient in that the exact relations between Marx and the French police are not clearly detailed, and Mr. Carr's "disclosures" are inadequate. In letter No. 40, dated June 7th, 1849 (page 107, Vol. 1), Marx wrote to Engels that his [Marx's] correspondence was being tampered with, and advised Engels to write to him under the pseudonym of Monsieur Ramboz, 45, Rue de Lille. In the letter No. 43, pp. 111-2, Vol. 1, dated August 17th, Marx again refers to the pseudonym.

In the next letter, No. 44, dated August 23rd 1849, p. 113, Vol. 1, Marx makes the vital and final decision concerning his future, which Mr. Carr calls the “most important landmark of Marx's career." But once more we discover that Mr. Carr is ignorant of the full contents of these letters. Actually, Marx's decision did not involve him, alone, for it changed the whole course of Engel's life, too.. “The most important landmark" referred to by Mr. Carr, depended entirely upon the letters referred to above. In the August 23rd letter (No. 44), Marx writes to Engels in Lausanne to inform him that he will not submit to the surveillance of the French police, who desire him to take up residence in the isolated Department of Mobihan (Brittany).

In his fulsome ignorance, Mr. Carr states that "Marx thought of joining Engels in Switzerland." This is a piece of invincible ignorance on the part of Mr. Carr for had he read Marx's letter, he would have found that Marx says (line 14, paragraph 2): —

   Nach der Schweiz gibt man mir keinen Pass. (I can get no passport for Switzerland.)

Marx impresses upon Engels to leave Lausanne and go right through to London, where he will join him. Marx is certain of being able to start a literary journal, for which one portion of the money is already available. He tells Engels it seems impossible for him to remain in Switzerland any longer.

    Du kannst nicht in der Schweiz bleiben. In London werden wir Geschäfte maen. . (You cannot remain in Switzerland. We will do business in London.)

This last sentence is of the utmost importance, for, along with the letter No. 43, dated August 17th, 1849, it showed that Marx was certain that the starting of a journal would provide a living for both Marx and Engels. But the sting is in the tail. Marx appends a footnote to the letter, showing that he had no thought of going to Switzerland. He writes—

   Lupus ist bei Dr. Lüning, Zürich. Schreib ihm auch von meinem Plan. (Lupus is with Dr. Lüning in Zurich. Write him also about my plan.)
   (Lupus was the famous Wilhelm Wolff to whom Marx dedicated the first volume of “Capital.”)

Not one word of this is tendered, explained, or referred to by Mr. Carr on page 67 of his book. Obviously, Mr. Carr does not know of its existence. But there is more than that to it. It suggests the source of Mr. Carr's information, too, i.e., the 1913 edition. In his preface, on page VIII, Mr. Carr tenders thanks “to a friend who desires to remain anonymous, but who, while differing from many of my conclusions, has generously placed at my disposal a rich stock of Marxist lore.” It was in the 1913 edition of the letters that the passage in letter 43, and the sentence from letter 44, “In London werden wir Geschäfte machen,” were deliberately omitted. Specific attention is called thereto in the 50-page introduction to Vol 1 of the correspondence issued by the Marx-Engels Institute.

If Mr. Carr had regard for the truth, nothing could have deterred him from giving the page, date, number, and volume from which he was quoting. Let us test Mr. Carr's credentials once more. It concerns an episode of which he writes with exceeding enthusiasm, for which he tenders Marx a surprising encomium. The very instance arouses suspicion. It provides more evidence of Mr. Carr's patent superficiality, and invincible shallowness. On page 109 he refers to Marx's “Eighteenth Brumaire," and says that it

   demands quotations not so much for its political importance as for its literary merits. The contorted antithetical style of Marx’s early period has been left behind. The “Eighteenth Brumaire” contains some of the simplest and raciest of Marx’s writing; and the fierceness of the invective (for Marx always shines at invective) gives it a high place among political broadsides. It may be heartily recommended to anyone who thinks Marx is a dull writer.

Then follows the opening section of the first paragraph of the “Brumaire.” Once again his bluff is exposed. For had Mr. Carr read letter No. 134, which Engels wrote to Marx from Manchester on December 3rd, 1851, he would have seen the origin of the passage which was afterwards incorporated into the “Brumaire" by Marx. It is on page 292 of Vol 1. Let any reader examine the opening of the “Brumaire,” and he can easily follow the quotation.

   alles sich zweimal anspinnen liesse, einmal als grosse Tragödie, und das zweite Mai als lausige Farce, Caussidiere für Danton, L. Blanc für Robespierre, Barthelemy für Saint-Just, Flocon für Carnot, . . etc. (these things occur twice, first as great tragedy and secondly as paltry farce . . . etc.)

Now, Engels wrote that note to Marx within 24 hours of the coup d'état, and yet later accorded the credit to Marx for the analysis. Knowing the miserable proclivities of Mr. Carr in traducing and reviling Marx on the slightest provocation, he missed here his greatest opportunity of calling Marx a plagiarist, etc. But his lost opportunity is entirely due to Mr. Carr not having read the correspondence; an opportunity he surely would have used to bolster his case against Marx; if he had known of it.

The International.

The importance of the “International” is recognised by Mr. Carr, who uses about a quarter of the space of his book to expatiate upon this interesting aspect of Marx’s activities.

On page 184 he bursts forth with this serious diatribe: —

   The origin of the momentous decision to invite Marx—a decision which determined the whole course of the International from its inception to its death— is wrapped in strange obscurity. It is a depressing commentary on the nature of the evidence on which history is based that, in this comparatively straightforward matter, the historian has before him two mutually contradictory accounts from persons who participated, or purport to have participated, in the transaction. Each of these accounts is demonstrably, or almost demonstrably, false: and each has clearly been distorted by the desire of the narrator to exaggerate the importance of his own role.

If it is demonstrably false, why does Mr. Carr use the curious qualification “almost.” If it is “almost” demonstrably false, it isn't quite false. And if it isn't quite false, why worry? The fact is, Mr. Carr has not quite relished his job, and he was in a position of mental suspense in dealing with the matter. Besides, it is clear that he did not appreciate the whole story attributed to Marx. Had Mr. Carr quoted from Marx's letter (No. 876) he might have understood the matter. Had he read the correspondence, he might have quoted the facts, for, in this case, opposite page 196 of Vol 3, Marx's letter is produced in facsimile. Marx tells Engels that a young Frenchman, Le Lubez, about 30 years of age, brought up in Jersey and London, asked Marx if he would care to represent the German workers at the first meeting of the International. Mr. Carr suggests that this story is “demonstrably, or almost demonstrably, false.”

If it is demonstrably false, where is the evidence? Mr. Carr produces none. He produces the other version, this time by Marx's old friend, Frederick Lessner.

We will leave it to our readers as to whether there are contradictions. Mr. Carr quotes Lessner, but from what book or pamphlet, he declines to say. Let us, however, quote from Lessner's “Sixty Years of the Social Democratic Movement" (p. 33):

  The English committee invited also the “Communistische Arbeiterbildungsverein” to this meeting, and at the same time expressed a wish that Marx should attend this international fraternisation of the working men. The “Communistische Arbeiterbildungsverein” sent me to Marx. I informed him of the wish of the English workmen, and after some inquiries as to the conveners and the object of the meeting, Marx consented to come.

Is that contradictory? What authority Le Lubez had to approach Marx is not discussed by Mr. Carr. Mr. Carr's method of presenting material which cannot be immediately identified from its source, ill-befits him to accuse any person, and then submit no evidence to substantiate the accusations.

Not only is there no contradiction, but there is overwhelming evidence that shows how much Marx's presence was desired and required at the first meeting of the International. Both the Marx version and that of Lessner suggest that steps were being taken by various parties to have Marx’s assistance. It is clear there is no mystery at all about Marx’s presence. There is no “strange obscurity” regarding the decision to invite him. True, it is obscure and mysterious to Mr. Carr. Despite all his own trumpetings regarding his firsthand information, in this respect he succeeds in displaying his woeful ignorance and utter unfamiliarity with the accurate sources of information. Mr. Carr does not know that Marx received an official invitation to the first meeting. It proves once more that he has no great knowledge of the literature issued by the Marx-Engels Institute of Moscow, for on page 146 of “Karl Marx and Friedrich Engels,” by D. Riazanov, the story is given officially. There it is asked:—

   How did he [Marx] happen to be there? A little note found among Marx’s miscellaneous papers supplies the answer. It reads:—
    Mr. Marx,
    Dear Sir,
      The committee who have organised the meeting as announced in the enclosed bill respectfully request the favour of your attendance. The production of this will admit you to the Committee Room where the Committee will meet at half past 7.
                                                                                         Yours respectfully,

(Signed) W. R. CREMER. 

W. R. Cremer was the Organising Secretary for the first meeting of the International. He invited Marx. So the statement on page 184 of Carr’s book is only “wrapped in strange obscurity” because of the inadequate qualifications possessed by Mr. Carr. In matters historical, Mr. Carr is woefully and abysmally ignorant. Take for example the statement he makes on page 185, concerning Lessner, of whom he writes: —

Lessner had lived in London since the early fifties. . . .

What has Mr. Carr read of the activities of Lessner? He pretends to have quoted from a book of Lessner, but Mr. Carr is as ignorant as an unborn babe of the life of Lessner. Let us deal with this “early fifties” rubbish.

Lessner left London in July, 1848, for Cologne to carry on propaganda in association with Marx and Engels in the Rhineland. After the failure of the insurrectionary movement, Lessner was expelled from Wiesbaden on June 18th, 1850, whereafter he proceeded to Mainz to organise the few revolutionary elements left in the League of Communists. For this same purpose he went to Nuremberg. In June, 1851, he was arrested in Mainz, and detained in custody until a bill of indictment was entered against him 15 months later. His trial commenced on October 4th, 1852. The verdict was given on November 12th, and Lessner was condemned to imprisonment in a fortress for three years. On January 27th, 1856, he was released, making his way to London, where he arrived in May, 1856.

THAT, dear Mr. Carr,.was how Lessner spent the ”early fifties” in London!

Another elementary example of Mr. Carr's “authority” is the reference to Disraeli, in the first paragraph on page 201. He writes : —

   Disraeli, when he dished the Whigs, had gone a long way towards dishing the International—a body of which he had probably never heard.

That is a priceless gem from Mr. Carr, who pretends to possess something akin to universal knowledge of the working-class movement.

Mr. Carr’s assertion means that Disraeli did NOT read the “Times,” or other daily papers. But may we deal with the “Times”?

When the International Congress was held at Lausanne, Marx was able to push his friend, Eccarius, into receiving the sum of 2½ guineas per column for reporting the Congress. On Friday, September 6th, 1867, “The Times” had this head-line:—

    International Working Men’s Congress.
(From a correspondent.) Lausanne, Sept. 2nd. 

Then followed the article. To suggest that Disraeli would not read this is absurd.

Because of the reports that had percolated through Lausanne, “The Times,” on September 12th, published a leading article, dealing with the International Working Men’s Association (page 6, columns 5 and 6). A year later, Wednesday, September 9th, 1868, “The Times,” in its leading article, delivered an attack upon the International (page 6, columns 3 and 4).

Disraeli, who was always pretending to be on the side of the working class, knew all about the International, and aided the organisation to deal a nasty blow at the French Government. Had Mr. Carr read the correspondence between Marx and Engels, he would have known of this, for it is to be found in Vol. 3, page 372 (Letter 1011), December 21st, 1866. In that letter Marx wrote to Engels,. pointing out that the French authorities had confiscated some letters and documents belonging to the I.W.M.A., after the Geneva Congress. These papers were obtained at the border. Many demands were made in Paris for their return, without any success. Thereupon Marx claimed them through the British Foreign Office (Lord Stanley was Minister for Foreign Affairs), as the documents were “British Property.” As Marx says in the letter, poor Napoleon, through the Foreign Office, is to return all. When action by the Cabinet is necessary it means that at least SOME of England’s greatest politicians were aware of the organisations important enough to instigate such action.

There are other cases to show Mr. Carr’s ignorance. On page 201, he refers to the Fenian activity during 1867, and that the International held two meetings., “The Dublin papers were well represented,” says Mr. Carr. What does that mean? Were the newspaper representatives at both meetings? Mr. Carr does not make it clear at all. There is a reason. Mr. Carr has obviously not read the letters that passed between Marx and Engels.

Only TWO Dublin papers were present at the FIRST meeting, i.e., “The Irishman" and the “Nation." At the second meeting none of the Irish reporters turned up at all. At least, so Marx says, in letter 1079, dated November 30th, 1867, page 456, Vol. 3.

We had better not dismiss this Irish business without a further reference to Mr. Carr and the bluff about his translations from Marx’s works(?). On page 305 of his book, we are given an insight into the fine linguistic abilities of Mr. Carr. Says this oracle: —

   . . . In quoting from Marx’s other writings I have made my own translations. In a few passages originally written in English, I have been compelled by the inaccessibility of the English originals to re-translate from German or Russian versions.

So that’s it, is it? On page 202, when dealing with the Fenian movement, Mr. Carr writes of Jenny Marx—as usual he gives no source of origin: —

   Young Jenny Marx in the emotional enthusiasm of the early twenties “went in black since the Manchester execution and wore her Polish cross on a green ribbon.”

Mr. Carr’s quotation is clearly a “translation,” for he uses the words “went” and “wore.” The reader’s attention should be given to this important fact. The changed words predicate the “inaccessibility of the English originals.” Once more Mr. Carr proves his unfamiliarity with the Marx-Engels letters. There would have been no difficulty in printing the correct words, for the whole of the passage which Mr. Carr has had to “translate” is—and was—written by Marx in English. This can be found as a footnote to letter 1075, and is on page 453 of Vol. 3, dated November 28th, 1867. These are the words in the footnote: —

    My compliments to Mrs. Burns. Jenny goes in black since the Manchester execution, and wears her Polish cross on a green ribbon.

Had Mr. Carr seen the letter, would he have made the blunder of introducing inaccurate words?

We have noted many instances wherein he has falsified quotations. We have had abundant evidence of the meagre and deficient qualifications he possesses to adventure upon a “life” of Marx.

Mr. Carr not only persists in misquoting Marx, but, as might be expected, demonstrates that he does not understand Marxism. Space prevents dealing with other aspects of his book in detail. It may, however, be recorded that' he misinterprets the Materialist Conception of History. In one case he expounds it in the very maimer to which both Marx and Engels took objection, and warned their “followers’’ that if their interpretation was Marxism, they (Marx and Engels) were no Marxists. Like most Marx-critics, Mr. Carr dispenses with the knowledge, efforts and abilities of those preceding him, suggesting that his work is, at last! the only correct estimate of Marx and his life. The presumptuousness of Mr. Carr is amazing. Marx’s system of political economy is brushed aside by asserting that Bohm-Bawerk’s “Marx and the Close of his System” is the “classical exposure.” (I wonder if Mr. Carr has ever heard of Hilferding’s reply?) Mr. Carr shows himself incapable of understanding the purpose of Marx’s “Capital,” by stating that Marx wanted to

   demonstrate that the class-hatred of the proletariat against the bourgeoisie is explained and justified by the “exploitation” of the former by the latter.

In conclusion, it ought to be brought to the notice of the reader that not a single one of the large number of reviews of Mr. Carr’s book seen by the writer has shown any evidence of a critical faculty. Not one of these individuals has made the slightest endeavour to examine the book thoroughly. They have accepted Mr. Carr’s errors, misquotations and mistranslations without challenge. This is deplorable for one or two of the reviewers profess “to be” advocates of the proletariat, and ”advanced” thinkers! It is hard indeed to distinguish between the ignorance of the reviewers and that of Mr. Carr.

Moses Baritz

Editorial: Reason or Violence (1934)

Editorial from the July 1934 issue of the Socialist Standard

The meeting held by the Fascists on June 7th at the Olympia, was the occasion of disorder that has prompted a shower of newspaper correspondence, questions in Parliament, and the suggestion that the police should have the right of entry into public meetings.

As far as the information goes, there does not appear to be any doubt that organised groups went to the meeting with the deliberate intention of creating disorder. Why, then, is so much fuss being made over the fact that they were roughly ejected?

The outcry comes from such different quarters as Conservative, Liberal, Labour and Communist. The Conservatives have their own axe to grind, and are not anxious to assist the growth of Mosley’s following. The other groups appear to have the wind up.

What is exceedingly curious in the business, however, is the righteous indignation of the Communists—who have gloried in meeting-smashing for years, and promised to suppress all discordant voices if they got power.

In our view, those who went to the Fascist meeting with the intention of creating disorder and making the meeting impossible only got what they asked for, and have no reason to complain if they were roughly handled.

Violence is not a successful method of convincing people of the soundness of a case. In fact, it is usually an admission that the case is threadbare. A case is not destroyed by violent methods, though those who are putting it forward may have to tread cautiously for a while. Anyhow, the use of violence only provokes violence from the opposition.

One thing that stands out clearly, however, is the fact that these methods play right into Sir Oswald Mosley’s hands. He has shown his desire for the spectacular from the beginning, and the nature of the opposition he is receiving is giving him just the advertisement he needs.

The use of violent methods is an attempt to foist on to the majority of people views which they are unwilling or not ready to accept. It used to be a plank in the Syndicalist programme, and has since been the spearhead of the Communists, on the plea that the time for theory is past, and the time for action has come. It fosters the growth of secret movements, and the ubiquitous agent provocateur.

Behind the violent movement stalks the spirit of revenge, and passion instead of reason urges the combatants forward. It plays to the emotions and the worst elements in the population get a footing in the movement, or use the movement to cloak their own actions. This has been illustrated time after time in the history of the working-class movement, and it is therefore essential that those who are genuinely interested in pushing forward the workers’ struggle for emancipation should resist all incitements to violence.

The success of violent movements depends upon frightening people and not upon convincing them. It is as well to bear in mind that it is not the capitalist who is frightened, for he has the armed power at his command to crush out opposition when he desires to do so.

It may perhaps be of some use to point out to those who are following methods that kill free discussion, that they are following in the path of their predecessors in Italy and Germany, and provoking the ogre they fear. The starting-point of the Fascist career in Italy was the seizure of the Italian factories by the workers and the propaganda of violence by the Communists. Germany tells a similar tale. It may be added that the country that gave them the lesson was Russia, and one of the principal defenders of Russian violence —Trotzky—is now wandering about seeking an asylum—a victim of the methods he advocated.

It is only by free and open discussion that the workers can grasp the essentials of their present condition of servitude and the way to abolish it. Until they have this knowledge it matters little which of the capitalist parties they support.

While we are on the subject of “freedom of speech” we cannot help being surprised to find what curious, not to say, suspicious friends, this “freedom” has. We see among them the numerous organs of capitalism, which steadfastly decline to allow the publication in their columns of a statement of the Socialist case. We see the “Morning Post,” which published grossly inaccurate statements about the Austrian Social Democrats engaged in the fighting of February, and then would not publish a correction, although not denying that photographs published in its own pages a few weeks earlier proved the inaccuracy. We see "Forward" which charged us with misstatements about Keir Hardie a few years ago and then refused to let us give evidence to show that we were right. We see also Mr. Hamilton Fyfe, who, as Editor of the “Daily Herald" allowed correspondents to discuss our attitude towards religion, but would not let us intervene to explain our position. Maybe the threat presented by Sir Oswald Mosley's movement has induced a change of heart, but if so, there is a quite simple method by which the various political parties and papers can help to promote reasoned discussion, that is by copying the example set by the S.P.G.B., and by it alone, of allowing opponents to state their case in our columns and on our platform. At all of our propaganda meetings (although not at formal debates, where time forbids, or occasional commemoration meetings which do not lend themselves to questions), it is the standing practice of this party to allow questions and opposition, without any attempt to select or restrict. If our various opponents, Sir Oswald Mosley, the Liberals, Labourites, Tories and Communists believe that, they have a good case and can answer criticisms, we suggest that they could largely reduce the possibility of rowdy meetings and at the same time promote calm discussion by throwing open their platform to their opponents, as we do to ours.

The Labour Theory of Value Before Karl Marx (1934)

From the July 1934 issue of the Socialist Standard

The labour theory of value is the view that the value of an article is determined by its cost of production in human labour power—according to the conditions of the time. In its fully developed form it was analysed and explained in detail by Karl Marx in “Capital.” We are not concerned at the moment with the theory as it was finally worked out. We are only concerned with the forerunners of Marx, who contributed something to the view. Owing to limits of space we can only consider briefly the most outstanding of these forerunners.

Value presented an insoluble problem for over two thousand years. The first glimmerings of a solution did not appear until the middle of the seventeenth century, when a society mainly concerned with the buying and selling of goods began to take definite shape in this country and was in process of taking shape on the Continent.

As far back as the time of Aristotle—two thousand three hundred years ago—the problem was in the air. Aristotle himself, in his “Politics,” and in his “Ethics,” had something to say about it. He knew that there must be some property common to objects as unlike as bread and shoes that made it possible to measure them against each other. He knew that the common property was not their usefulness, but he was unable to find out what it really was. He ends his examination rather lamely with the remark that people have agreed to estimate value in money. And this after he had already pointed out that exchange existed before money. He makes the illuminating remark, however, that profit-making originated with coin.

For hundreds of years this formed the limit of knowledge on the subject.

As commerce spread over society and accumulating money became increasingly the aim in social dealings, the question of the value of money came more and more to the front, particularly when succeeding representatives of the royal treasury sought to build up waning funds by debasing the coinage. Consequently, during the later middle ages, a considerable literature grew up around monetary matters. With the dawn of capitalist society, in the 17th century, the question became acute. The problem before the writers was: How did wealth originate? Or, as we would put, it: What was the source of surplus-value?

Out of these discussions two main schools of thought developed. The Mercantilists and the Physiocrats, one English and the other French. The Mercantilists claimed that wealth accumulated by means of trade, through buying from the foreigner cheap and selling to him dear. In other words, by having a favourable balance of trade,” an idea that still persists, as witness the nature of the discussions during the recent financial crisis. The Mercantilists, consequently, propagated the view that the traders were the most important group in the nation and were the builders of the nation’s wealth. An idea quite in harmony with conditions that were raising the trader to the most influential position in society.

Thomas Mun, a leading merchant of the time and a director of the East India Company, wrote a book that was published in 1664 entitled “England’s Treasure by Foreign Trade,” which puts forward the Mercantilist view very clearly and vigorously.

The Physiocrats, a group that originated nearly a hundred years later in France, a country whose main prop at the time was agriculture, held an entirely different view. According to them, wealth originated solely in agricultural production, as it was only by farming that a man received back for his work more than it cost to keep him, and, out of the surplus, the trader and the rest of the population lived. Turgot, a prominent Physiocratic writer, who appeared towards the end of their influence, puts their outlook very clearly in his book, “Reflections on the Formation and the Distribution of Riches,” published in 1766.. The Physiocratic doctrines were an expression of the interests and outlook of the capitalist farmer, and Mirabeau, one of their leading political representatives, took a prominent part in the French Revolution.

Turgot was a very clear thinker. He had a considerable knowledge of history and had travelled far enough intellectually to point out that the labourer’s wage was determined by his cost of subsistence.

Sir William Petty, an important member of the Mercantilist school of thought, was the first to make a real contribution to the labour theory of value. In a book he wrote that was published in 1662 and entitled “A Treatise on Taxes,” he states quite plainly that it is labour that gives value to things, but, under the influence of his trading outlook, he defines exchange-value as money, and the particular labour employed in the production of gold and silver as the value-producing labour. Hence he was led into confusion.

He wrote a series of essays in "Political Arithmetic,” which represents the first form in which economics is treated as a separate department of knowledge. These essays are remarkable for brevity and clarity. In one of them he explains in a paragraph the significance of the division of labour as illustrated by a watch, and he does it in a manner that showed he had a clearer grasp of the point than Adam Smith, although, writing a hundred years earlier. Adam Smith confused the social division of labour with the division of labour inside a single workshop, but Petty made no such mistake.

In 1733, Richard Cantillon, another merchant, wrote his book “On the Nature of Commerce in General." In it he stated that the value of a thing was nothing more than the measure of the land and the labour which enters into its production. He was influenced by the Physiocratic idea of the importance of agriculture, as also to some extent was Adam Smith. Cantillon held the view that the daily work of the humblest slave corresponded in value to twice the produce of the land on which he subsisted.

After Petty there was another thinker, probably the clearest thinker of his age, who put forward the labour theory of value in a broad form. This man was Benjamin Franklin, who, in 1729, when barely twenty-three years of age, wrote an essay entitled “A Modest Inquiry into the Nature and Necessity of a Paper Currency." In this essay he argues that the value of articles is measured by the time taken to produce them, but he considers that money has an extra value on account of the way in which it facilitates exchanges. In spite of his clearness of thought he, like his predecessors, was lost in the mystery of money. In fact, all those who preceded Marx got into difficulties when they came to treat of money. In their efforts to analyse money they frequently contradicted the sound views they had previously put forward on value in general.

Another youthful writer, an Italian named Ferdinando Galiani, published a book, in 1750, entitled, “Dell Moneta." He was only twenty-two years old when he wrote it. In this book he pointed out that labour was the sole source of value, but he confused the wages of the worker with the value of the article produced. For instance, he contended that the value of a woollen article was equal to the cost of the raw wool plus the cost of supporting the men who produced the woollen article.

In 1777, Adam Smith’s “Wealth of Nations" appeared. In it he attributed the accumulation of wealth to the division of labour. He made a considerable advance in the analysis of questions concerning economics, but he was still far from understanding the real nature of value. He held that the determination of the value of an article by the labour-time taken to produce it was true of earlier times, but not of the developed capitalism of his day. He also fell into the same error as Galiani, confusing the value of what a man produces with the value of what he gets—his wages. If this view were accepted, then the value of all the articles produced would only be equal to the total wages paid to the workers who produced them.. This was the state of affairs the later Utopians yearned for and what they would have called “fair exchanges." Adam Smith also failed to see that the labour of an engineer and the labour of a bootmaker could not be compared as such—they had both to be reduced to a common basis, the simple expenditure of human energy.

How weak Adam Smith’s grasp of the problem was may be gathered from the fact that he put “labouring cattle" under the heading of productive labourers, and also attributed value-creating properties to “profits of stock” and to the forces of nature.

The progress in knowledge of the labour theory before Marx really ended with David Ricardo, a stockbroker, who made the final contribution in his book, "On the Principles of Political Economy and Taxation,” published in 1817. His fundamental proposition is that the values of all articles, including the value of labour-power, is determined by the labour required to produce them with the prevailing skill and methods. But, as Frederick Engels has pointed out, Ricardo did not see that it was labour-power and not labour that was the value-producing quality, and hence, that the transformation of money into capital was based upon the buying and selling of labour-power. It was the discovery of this fact that gave Marx the key to the problem, and it was Ricardo’s failure to see it that landed him into difficulties when he came to treat of the more complex forms of money.

As a capitalist himself, and one who made a fortune on the stock exchange, Ricardo was quite clear, in fact brutally clear, about the basis of the present social system and its aim, which, he pointed out, was production for profit. He was against State interference in industry, and contended that wages should be left to free competition. He also held the view that the prevailing economic tendency was for wages and rent mutually to increase until they swallowed profit, and he foresaw a time when all property would belong to owners of land and receivers of tithes and taxes. He was quite clear, however, about the fact that neither wages nor profit, nor rent, entered into the determination of the value of an article. Surplus-value, he showed, was the portion of value left after deducting the wages of the producer from the value he added, but he was inclined to confound surplus-value with profit.

As already mentioned, the analysis of value really ended with Ricardo. Nobody after him added anything of importance to his work. The so-called “Ricardian Socialists” who followed him accepted his view that labour was the source of value, and, on the basis of it, demanded that all products should belong to the labourer.

The first of these writers was William Thompson, an Irish landlord, who, in 1824, wrote a book entitled “An Inquiry into the Principles of the Distribution of Wealth most conducive to human Happiness.” As the title of his book suggests, the ideas of the “Utilitarian” philosopher, Bentham, had an influence on his outlook. He defined the existing social system as one of force and fraud, and he proposed a new system on Owenite principles. He was very much interested in the Owenite co-operative experiments and visited the Owenite colony at Ralahine, in Ireland.

He took as his basis the view that all wealth is the product of labour. He contended that all men are equal, or nearly so, and therefore capable of producing equal quantities of wealth. Wealth is unequally divided, therefore the few possessors must abstract it from the many producers.

Neither he nor those of the same group who followed him really understood the nature of value. They thought the seller arbitrarily raised the value of articles above the wages paid to the producers, which they took to be the real value. He held that labour was not, at present, an accurate measure of value, on the ground that desires are apt to vary, but he contended that in a future social system such as he proposed, commodities would exchange at the “ value of real use." He assumed that the future system would also be a system of commodity production, but “fair" exchange would be the social principle.

Thompson's confused views of value are illustrated by the fact that he believed machinery added additional value to products beyond the value as mere instruments of production, and also that, in certain instances where labour is saved in the production of an article, value is added to it by this saving of labour.

In 1825, a year after Thompson's book, appeared, Thomas Hodgskin wrote his “Labour Defended against the Claims of Capital," and, in 1827, “Popular Political Economy." Hodgskin, a retired naval officer, was a friend of ] Francis Place and a member of the radical circle that gathered round Jeremy Bentham.

He also argued that the labourer should receive the whole of his product, but he included in the term "labourer" the master and the buyer and seller. He accepted commodity-production as the basis of a future society, but wanted to rule out profit. On the question of value, he was not clear. He confused the value of goods with the quantity, and asserted that the more goods there were the greater was the total value, in spite of a proportional decrease in the quantity of labour required to produce them. He also appeared to think that profit and rent were amounts added on to the value of articles.

Although his outlook on this fundamental question was confused, Hodgskin’s destructive criticism of existing society provided the Chartists with useful weapons in their struggle. He did a considerable amount of lecturing, founded with Robertson the “Mechanics' Magazine," in 1823, and was instrumental in the founding of the Mechanics' Institute, where he lectured. He later joined the staff of the Economist and the Morning Chronicle, dropped out of the active propaganda movement, and lived to a ripe old age.

 

After Hodgskin comes John Gray, a successful business man, who delivered a series of lectures on "The Nature and Use of Money," which were published in book form in 1831 and again later in 1848. In these lectures he claimed to have discovered the real source of social troubles, which he attributed to a flaw in the monetary system. He urged that demand should be based upon production, instead of production being based upon demand, which, he claimed, was the basis of the existing system. He proposed to rectify matters by establishing standard banks which would issue credit in the form of transferable vouchers based upon the stock, etc., or, in other words, based upon the powers of production.

So convinced was Gray of the soundness and the magnitude of his discovery that he had his book widely distributed, particularly to economists and universities, and he offered a hundred guineas to anyone who could refute his views. In recent times the Douglas Credit Theory has had a certain popularity, but there is little in the fallacious theories of the Douglas scheme that was not anticipated by Gray a hundred years ago.

Gray's views on value were quite erroneous. He believed that gold was no true measure of value and that there was none. He contended that the scarcity of gold prevented its value from being determined by labour. He, again, took for granted the continuation of commodity-production, but proposed that, in future, labour should be the measure of value. This was to be accomplished by the producer fixing his own price for his product and the competition of producers determining whether this price was right or not!

Gray was, at one time, considerably influenced by the views of Robert Owen, and, in 1815, he managed an Owenite colony at Orbiston.

The last writer we will refer to is J. F. Bray, a journeyman printer and the author of "Labour’s Wrongs and Labour's Remedy," published in 1839. His book is long and very wordy and full of conceptions of justice and equal rights, inspired by the economic analysis of Ricardo. His fundamental proposition is that as the earth is common to all, and labour is the sole source of wealth, each human being has a right to the fruits of his own labour. He claimed that as wealth was produced by labour, the capitalist, who did not work, lived by the legalised robbery of the producer. He claimed further that the problem was the same in all countries, whatever their form of government, and that, therefore, the solution applied internationally. A strain of anarchism runs through his writings, but he made some very apt criticisms of existing arrangements and had very clear conceptions on particular points.

His fundamental ideas, however, clouded his analysis of the present economic framework. He believed that the capitalist made his profit through unequal exchanges—buying goods at their values and selling them for more than their values. For instance, he saw that the capitalist paid the worker for a day’s labour a wage that was only equivalent in value to the product of half a day’s labour, but he did not see that what the worker was paid was the value of his labour-power. He did not realise the implication of his view. He fell into the same error as many before him and believed that value was equivalent to the wages paid to the producer.

Like the rest of the Utopians, Bray believed that the world had been searching for thousands of years for a just form of society and it was now discovered. To him the correct society was the result of knowledge based upon first principles which were true for all time, and could have been established as easily two thousand years ago as to-day.

It will, therefore, be seen that he had no fresh contribution to make to the labour theory of value. On one point, however, he was quite clear and emphatic—that mere governmental changes would not alter the worker’s position. Hence he advocated a complete change in the social basis—but it was not really so complete as he imagined.

To sum up, it may be said that the analysis of value from the point of view of the labour theory begins in 1662 with Petty, and ends in 1817 with Ricardo. Although the Utopians did not further this analysis, they did excellent service in pushing forward the worker’s case, in the course of which they made valuable and biting criticisms of capitalist society. As Marx has pointed out, the kernel of the matter was contained in their outlook, and their attitude logically led to Socialist ideas.

Gilmac.