System of Economical Contradictions; or, the Philosophy of Misery Part 4

This it is necessary to make clearer by a few examples, before entering fully upon the examination of political economy.

% 2.--Inadequacy of theories and criticisms.

We will record first an important observation: the contending parties agree in acknowledging a common authority, whose support each claims,--SCIENCE.

Plato, a utopian, organized his ideal republic in the name of science, which, through modesty and euphemism, he called philosophy. Aristotle, a practical man, refuted the Platonic utopia in the name of the same philosophy. Thus the social war has continued since Plato and Aristotle. The modern socialists refer all things to science one and indivisible, but without power to agree either as to its content, its limits, or its method; the economists, on their side, affirm that social science in no wise differs from political economy.

It is our first business, then, to ascertain what a science of society must be.

Science, in general, is the logically arranged and systematic knowledge of that which IS.

Applying this idea to society, we will say: Social science is the logically arranged and systematic knowledge, not of that which society HAS BEEN, nor of that which it WILL BE, but of that which it IS in its whole life; that is, in the sum total of its successive manifestations: for there alone can it have reason and system. Social science must include human order, not alone in such or such a period of duration, nor in a few of its elements; but in all its principles and in the totality of its existence: as if social evolution, spread throughout time and s.p.a.ce, should find itself suddenly gathered and fixed in a picture which, exhibiting the series of the ages and the sequence of phenomena, revealed their connection and unity. Such must be the science of every living and progressive reality; such social science indisputably is.

It may be, then, that political economy, in spite of its individualistic tendency and its exclusive affirmations, is a const.i.tuent part of social science, in which the phenomena that it describes are like the starting-points of a vast triangulation and the elements of an organic and complex whole.

From this point of view, the progress of humanity, proceeding from the simple to the complex, would be entirely in harmony with the progress of science; and the conflicting and so often desolating facts, which are today the basis and object of political economy, would have to be considered by us as so many special hypotheses, successively realized by humanity in view of a superior hypothesis, whose realization would solve all difficulties, and satisfy socialism without destroying political economy. For, as I said in my introduction, in no case can we admit that humanity, however it expresses itself, is mistaken.

Let us now make this clearer by facts.

The question now most disputed is unquestionably that of the ORGANIZATION OF LABOR.

As John the Baptist preached in the desert, REPENT YE, so the socialists go about proclaiming everywhere this novelty old as the world, ORGANIZE LABOR, though never able to tell what, in their opinion, this organization should be. However that may be, the economists have seen that this socialistic clamor was damaging their theories: it was, indeed, a rebuke to them for ignoring that which they ought first to recognize,--labor. They have replied, therefore, to the attack of their adversaries, first by maintaining that labor is organized, that there is no other organization of labor than liberty to produce and exchange, either on one's own personal account, or in a.s.sociation with others,--in which case the course to be pursued has been prescribed by the civil and commercial codes. Then, as this argument served only to make them the laughing-stock of their antagonists, they a.s.sumed the offensive; and, showing that the socialists understood nothing at all themselves of this organization that they held up as a scarecrow, they ended by saying that it was but a new socialistic chimera, a word without sense,--an absurdity. The latest writings of the economists are full of these pitiless conclusions.

Nevertheless, it is certain that the phrase organization of labor contains as clear and rational a meaning as these that follow: organization of the workshop, organization of the army, organization of police, organization of charity, organization of war. In this respect, the argument of the economists is deplorably irrational. No less certain is it that the organization of labor cannot be a utopia and chimera; for at the moment that labor, the supreme condition of civilization, begins to exist, it follows that it is already submitted to an organization, such as it is, which satisfies the economists, but which the socialists think detestable.

There remains, then, relatively to the proposal to organize labor formulated by socialism, this objection,--that labor is organized. Now, this is utterly untenable, since it is notorious that in labor, supply, demand, division, quant.i.ty, proportion, price, and security, nothing, absolutely nothing is regulated; on the contrary, everything is given up to the caprices of free-will; that is, to chance.

As for us, guided by the idea that we have formed of social science, we shall affirm, against the socialists and against the economists, not that labor MUST BE ORGANIZED, nor that it is ORGANIZED but that it IS BEING ORGANIZED.

Labor, we say, is being organized: that is, the process of organization has been going on from the beginning of the world, and will continue till the end. Political economy teaches us the primary elements of this organization; but socialism is right in a.s.serting that, in its present form, the organization is inadequate and transitory; and the whole mission of science is continually to ascertain, in view of the results obtained and the phenomena in course of development, what innovations can be immediately effected.

Socialism and political economy, then, while waging a burlesque war, pursue in reality the same idea,--the organization of labor.

But both are guilty of disloyalty to science and of mutual calumny, when on the one hand political economy, mistaking for science its sc.r.a.ps of theory, denies the possibility of further progress; and when socialism, abandoning tradition, aims at reestablis.h.i.+ng society on undiscoverable bases.

Thus socialism is nothing but a profound criticism and continual development of political economy; and, to apply here the celebrated aphorism of the school, Nihil est in intellectu, quod non prius fuerit in sensu, there is nothing in the socialistic hypotheses which is not duplicated in economic practice. On the other hand, political economy is but an impertinent rhapsody, so long as it affirms as absolutely valid the facts collected by Adam Smith and J. B. Say.

Another question, no less disputed than the preceding one, is that of usury, or lending at interest.

Usury, or in other words the price of use, is the emolument, of whatever nature, which the proprietor derives from the loan of his property. Quidquid sorti accrescit usura est, say the theologians. Usury, the foundation of credit, was one of the first of the means which social spontaneity employed in its work of organization, and whose a.n.a.lysis discloses the profound laws of civilization. The ancient philosophers and the Fathers of the Church, who must be regarded here as the representatives of socialism in the early centuries of the Christian era, by a singular fallacy,--which arose however from the paucity of economic knowledge in their day,--allowed farm-rent and condemned interest on money, because, as they believed, money was unproductive. They distinguished consequently between the loan of things which are consumed by use--among which they included money--and the loan of things which, without being consumed, yield a product to the user.

The economists had no difficulty in showing, by generalizing the idea of rent, that in the economy of society the action of capital, or its productivity, was the same whether it was consumed in wages or retained the character of an instrument; that, consequently, it was necessary either to prohibit the rent of land or to allow interest on money, since both were by the same t.i.tle payment for privilege, indemnity for loan. It required more than fifteen centuries to get this idea accepted, and to rea.s.sure the consciences that had been terrified by the anathemas p.r.o.nounced by Catholicism against usury. But finally the weight of evidence and the general desire favored the usurers: they won the battle against socialism; and from this legitimation of usury society gained some immense and unquestionable advantages. Under these circ.u.mstances socialism, which had tried to generalize the law enacted by Moses for the Israelites alone, Non foeneraberis proximo tuo, sed alieno, was beaten by an idea which it had accepted from the economic routine,-- namely, farm-rent,--elevated into the theory of the productivity of capital.

But the economists in their turn were less fortunate, when they were afterwards called upon to justify farm-rent in itself, and to establish this theory of the product of capital. It may be said that, on this point, they have lost all the advantage they had at first gained against socialism.

Undoubtedly--and I am the first to recognize it--the rent of land, like that of money and all personal and real property, is a spontaneous and universal fact, which has its source in the depths of our nature, and which soon becomes, by its natural development, one of the most potent means of organization. I shall prove even that interest on capital is but the materialization of the aphorism, ALL LABOR SHOULD LEAVE AN EXCESS. But in the face of this theory, or rather this fiction, of the productivity of capital, arises another thesis no less certain, which in these latter days has struck the ablest economists: it is that all value is born of labor, and is composed essentially of wages; in other words, that no wealth has its origin in privilege, or acquires any value except through work; and that, consequently, labor alone is the source of revenue among men. How, then, reconcile the theory of farm-rent or productivity of capital--a theory confirmed by universal custom, which conservative political economy is forced to accept but cannot justify--with this other theory which shows that value is normally composed of wages, and which inevitably ends, as we shall demonstrate, in an equality in society between net product and raw product?

The socialists have not wasted the opportunity. Starting with the principle that labor is the source of all income, they began to call the holders of capital to account for their farm-rents and emoluments; and, as the economists won the first victory by generalizing under a common expression farm-rent and usury, so the socialists have taken their revenge by causing the seignorial rights of capital to vanish before the still more general principle of labor. Property has been demolished from top to bottom: the economists could only keep silent; but, powerless to arrest itself in this new descent, socialism has slipped clear to the farthest boundaries of communistic utopia, and, for want of a practical solution, society is reduced to a position where it can neither justify its tradition, nor commit itself to experiments in which the least mistake would drive it backward several thousand years.

In such a situation what is the mandate of science?

Certainly not to halt in an arbitrary, inconceivable, and impossible juste milieu; it is to generalize further, and discover a third principle, a fact, a superior law, which shall explain the fiction of capital and the myth of property, and reconcile them with the theory which makes labor the origin of all wealth. This is what socialism, if it wishes to proceed logically, must undertake. In fact, the theory of the real productivity of labor, and that of the fict.i.tious productivity of capital, are both essentially economical: socialism has endeavored only to show the contradiction between them, without regard to experience or logic; for it appears to be as dest.i.tute of the one as of the other. Now, in law, the litigant who accepts the authority of a t.i.tle in one particular must accept it in all; it is not allowable to divide the doc.u.ments and proofs.

Had socialism the right to decline the authority of political economy in relation to usury, when it appealed for support to this same authority in relation to the a.n.a.lysis of value? By no means. All that socialism could demand in such a case was, either that political economy should be directed to reconcile its theories, or that it might be itself intrusted with this difficult task.

The more closely we examine these solemn discussions, the more clearly we see that the whole trouble is due to the fact that one of the parties does not wish to see, while the other refuses to advance.

It is a principle of our law that no one can be deprived of his property except for the sake of general utility, and in consideration of a fair indemnity payable in advance.

This principle is eminently an economic one; for, on the one hand, it a.s.sumes the right of eminent domain of the citizen expropriated, whose consent, according to the democratic spirit of the social compact, is necessarily presupposed. On the other hand, the indemnity, or the price of the article taken, is fixed, not by the intrinsic value of the article, but by the general law of commerce,--supply and demand; in a word, by opinion. Expropriation in the name of society may be likened to a contract of convenience, agreed to by each with all; not only then must the price be paid, but the convenience also must be paid for: and it is thus, in reality, that the indemnity is estimated. If the Roman legists had seen this a.n.a.logy, they undoubtedly would have hesitated less over the question of expropriation for the sake of public utility.

Such, then, is the sanction of the social right of expropriation: indemnity.

Now, practically, not only is the principle of indemnity not applied in all cases where it ought to be, but it is impossible that it should be so applied. Thus, the law which established railways provided indemnity for the lands to be occupied by the rails; it did nothing for the mult.i.tude of industries dependent upon the previous method of conveyance, whose losses far exceeded the value of the lands whose owners received compensation.

Similarly, when the question of indemnifying the manufacturers of beet-root sugar was under consideration, it occurred to no one that the State ought to indemnify also the large number of laborers and employees who earned their livelihood in the beet-root industry, and who were, perhaps, to be reduced to want.

Nevertheless, it is certain, according to the idea of capital and the theory of production, that as the possessor of land, whose means of labor is taken from him by the railroad, has a right to be indemnified, so also the manufacturer, whose capital is rendered unproductive by the same railroad, is ent.i.tled to indemnification. Why, then, is he not indemnified? Alas!

because to indemnify him is impossible. With such a system of justice and impartiality society would be, as a general thing, unable to act, and would return to the fixedness of Roman justice. There must be victims. The principle of indemnity is consequently abandoned; to one or more cla.s.ses of citizens the State is inevitably bankrupt.

At this point the socialists appear. They charge that the sole object of political economy is to sacrifice the interests of the ma.s.ses and create privileges; then, finding in the law of expropriation the rudiment of an agrarian law, they suddenly advocate universal expropriation; that is, production and consumption in common.

But here socialism relapses from criticism into utopia, and its incapacity becomes freshly apparent in its contradictions. If the principle of expropriation for the sake of public utility, carried to its logical conclusion, leads to a complete reorganization of society, before commencing the work the character of this new organization must be understood; now, socialism, I repeat, has no science save a few bits of physiology and political economy. Further, it is necessary in accordance with the principle of indemnity, if not to compensate citizens, at least to guarantee to them the values which they part with; it is necessary, in short, to insure them against loss. Now, outside of the public fortune, the management of which it demands, where will socialism find security for this same fortune?

It is impossible, in sound and honest logic, to escape this circle. Consequently the communists, more open in their dealings than certain other sectarians of flowing and pacific ideas, decide the difficulty; and promise, the power once in their hands, to expropriate all and indemnify and guarantee none. At bottom, that would be neither unjust nor disloyal.

Unfortunately, to burn is not to reply, as the interesting Desmoulins said to Robespierre; and such a discussion ends always in fire and the guillotine. Here, as everywhere, two rights, equally sacred, stand in the presence of each other, the right of the citizen and the right of the State; it is enough to say that there is a superior formula which reconciles the socialistic utopias and the mutilated theories of political economy, and that the problem is to discover it. In this emergency what are the contending parties doing? Nothing. We might say rather that they raise questions only to get an opportunity to redress injuries. What do I say? The questions are not even understood by them; and, while the public is considering the sublime problems of society and human destiny, the professors of social science, orthodox and heretics, do not agree on principles. Witness the question which occasioned these inquiries, and which its authors certainly understand no better than its disparagers,--THE RELATION OF PROFITS AND WAGES.

What! an Academy of economists has offered for compet.i.tion a question the terms of which it does not understand! How, then, could it have conceived the idea?

Well! I know that my statement is astonis.h.i.+ng and incredible; but it is true. Like the theologians, who answer metaphysical problems only by myths and allegories, which always reproduce the problems but never solve them, the economists reply to the questions which they ask only by relating how they were led to ask them: should they conceive that it was possible to go further, they would cease to be economists.

For example, what is profit? That which remains for the manager after he has paid all the expenses. Now, the expenses consist of the labor performed and the materials consumed; or, in fine, wages. What, then, is the wages of a workingman? The least that can be given him; that is, we do not know. What should be the price of the merchandise put upon the market by the manager?

The highest that he can obtain; that is, again, we do not know.

Political economy prohibits the supposition that the prices of merchandise and labor can be FIXED, although it admits that they can be ESTIMATED; and that for the reason, say the economists, that estimation is essentially an arbitrary operation, which never can lead to sure and certain conclusions. How, then, shall we find the relation between two unknowns which, according to political economy, cannot be determined? Thus political economy proposes insolvable problems; and yet we shall soon see that it must propose them, and that our century must solve them. That is why I said that the Academy of Moral Sciences, in offering for compet.i.tion the question of the relation of profits and wages, spoke unconsciously, spoke prophetically.

But it will be said, Is it not true that, if labor is in great demand and laborers are scarce, wages will rise, while profits on the other hand will decrease; that if, in the press of compet.i.tion, there is an excess of production, there will be a stoppage and forced sales, consequently no profit for the manager and a danger of idleness for the laborer; that then the latter will offer his labor at a reduced price; that, if a machine is invented, it will first extinguish the fires of its rivals; then, a monopoly established, and the laborer made dependent on the employer, profits and wages will be inversely proportional?

Cannot all these causes, and others besides, be studied, ascertained, counterbalanced, etc.?

Oh, monographs, histories!--we have been saturated with them since the days of Adam Smith and J. B. Say, and they are scarcely more than variations of these authors' words. But it is not thus that the question should be understood, although the Academy has given it no other meaning. The RELATION OF PROFITS AND WAGES should be considered in an absolute sense, and not from the inconclusive point of view of the accidents of commerce and the division of interests: two things which must ultimately receive their interpretation. Let me explain myself.

Considering producer and consumer as a single individual, whose recompense is naturally equal to his product; then dividing this product into two parts, one which rewards the producer for his outlay, another which represents his profit, according to the axiom that all labor should leave an excess,--we have to determine the relation of one of these parts to the other. This done, it will be easy to deduce the ratio of the fortunes of these two cla.s.ses of men, employers and wage-laborers, as well as account for all commercial oscillations. This will be a series of corollaries to add to the demonstration.

Now, that such a relation may exist and be estimated, there must necessarily be a law, internal or external, which governs wages and prices; and since, in the present state of things, wages and prices vary and oscillate continually, we must ask what are the general facts, the causes, which make value vary and oscillate, and within what limits this oscillation takes place.

But this very question is contrary to the accepted principles; for whoever says OSCILLATION necessarily supposes a mean direction toward which value's centre of gravity continually tends; and when the Academy asks that we DETERMINE THE OSCILLATIONS OF PROFIT AND WAGES, it asks thereby that we DETERMINE VALUE. Now that is precisely what the gentlemen of the Academy deny: they are unwilling to admit that, if value is variable, it is for that very reason determinable; that variability is the sign and condition of determinability. They pretend that value, ever varying, can never be determined. This is like maintaining that, given the number of oscillations of a pendulum per second, their amplitude, and the lat.i.tude and elevation of the spot where the experiment is performed, the length of the pendulum cannot be determined because the pendulum is in motion. Such is political economy's first article of faith.

As for socialism, it does not appear to have understood the question, or to be concerned about it. Among its many organs, some simply and merely put aside the problem by subst.i.tuting division for distribution,--that is, by banis.h.i.+ng number and measure from the social organism: others relieve themselves of the embarra.s.sment by applying universal suffrage to the wages question. It is needless to say that these plat.i.tudes find dupes by thousands and hundreds of thousands.

The condemnation of political economy has been formulated by Malthus in this famous pa.s.sage:--