Front Page Titles (by Subject) CHAPTER X.: ECONOMIC CRISES. - The Tyranny of Socialism
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CHAPTER X.: ECONOMIC CRISES. - Yves Guyot, The Tyranny of Socialism 
The Tyranny of Socialism, ed. J.H. Levy (London: Swan Sonnenschein and Co., 1894).
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They are caused by Excessive Consumption—The Agriculturist and Bad Harvests—The Railroad Crisis.
It is not only the delegate from the Labour Exchange, the disciple of Lassalle and of Karl Marx, who interrupts me. It is all those who talk about political economy; and those who talk about it without having studied it, are as numerous as those who give medical advice to their relations and friends. They tell me:
You will not deny that commercial crises are due to an excess of production?
I do deny it!
You ruin your argument.
I am not labouring to support a thesis; I demonstrate truths, and I will prove to you that economic crises are not due to excessive production, but to excessive consumption.
Corn does not grow up unaided in a field. Manual labour is needed, which must be purchased; horses are needed, whose shelter and fodder are expensive; the soil needs manuring and tending, and seeds must be sown—these are all costly things. If the harvest is good the agriculturist recoups his expenditure, plus a certain payment, which constitutes his profit.
When by a series of accidents his crops do not yield enough to repay the advances he has made, he has been guilty of an excess of consumption, and he has nothing to give in exchange for agricultural machinery, clothing, boots, cattle, etc. He consumes fewer of the products of manufacture, because he has not the wherewithal to purchase.
This is the cause of a large number of economic crises, and the deficit which provokes them is just the reverse of excessive production.
Thus, to what, for example, was the great railway crisis in the United States due? Considerable capital had been swallowed up in earth works, in tunnelling through mountains, in the building of viaducts, in setting millions of tons of rails. This capital had lost its purchasing power. Just at the moment when the use of these railroads would have restored it, there was an excess of consumption, and consequently a crisis—a crisis which rebounded upon workshops and factories, which had also been led into excessive consumption of implements, the purchase of raw materials, and the payment of manual labour, relatively to the outlets which were now closed to them.