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Collected Works of Bastiat, vol. 5: Economic Harmonies

Collected Works of Frédéric Bastiat: Vol. 5 Economic Harmonies

[Created: Feb. 20, 2019]

Frédéric Bastiat (1801-1850)
Map of Les Landes in SW France

Introduction

This is a final draft of the text with footnotes (but not the bibliography, glossaries and Appendix) as of 20 Feb. 2019.

Please note the following:

  • this is an "Editor's Final Draft" which will be tidied up and properly formatted by our in-house editor, especially things like data tables
  • what we do not have here is the Front Matter and Introduction
  • the internal references have been left blank deliberately (e.g., see, pp. 000.) as they are place-holders
  • the quotes are side-by-side in French and English for research purposes. Only English quotes will apper in the final version

For more information about Frédéric Bastiat see the following:

 


 

Table of Contents

Front Matter

  • Introduction to the Volume (to come)
Endnotes

1. Economic Harmonies: Introductory Material

2. Economic Harmonies (1850 ed.)

3. Economic Harmonies (2nd 1851 ed.)

4. Economic Harmonies (Additional Material)

Endnotes

Glossaries (to come)

Appendix 1: Further Aspects of Bastiat's Thought (to come)

Bibliography (to come)

 

1. Economic Harmonies: Introductory Material

 

Draft Preface for the Harmonies (1847)

Source

OC, vol. 7, p. 303-09. CW, vol. 1, pp. 316-20. Reprinted here because it really belongs with the Ec.Harmonies.

Editor’s Introductory Note

According to Paillottet, this draft preface, which is in the form of an ironic letter to himself (Bastiat), was written sometime in late 1847 while he was giving lectures to some young students in the Faculty of Law. It reads very much like the letters he and his closest friend from Mugron, Félix Coudroy, must have written in the 1820s, giving each other advice and consolation in the face of their doubts about studying various treatises of economics.[1]

Bastiat had started giving lectures on economics to some law students at the Taranne Hall in Paris in July 1847 using the first collection of his Economic Sophisms (published in Jan. 1846) as the textbook.[2] These lectures would later be turned into his treatise which eventually became Economic Harmonies. His course of lectures were interrupted by the outbreak of revolution in February 1848 and Bastiat never returned to lecturing. The preface refers to the book as “les Harmonies” (the Harmonies) because his original rather grand plan was to write a general treatise on Social Harmonies which would cover society as a whole. Since this turned out to be too ambitious given his political activities during the Second Republic and his failing health he decided to limit it to just the Economic Harmonies.[3] His planned chapters for the expanded version of the book were complied by Paillottet and inserted at the end of his conclusion of the first edition of the book.[4] We have attempted to reconstruct what his three-volume treatise would look like from his scattered remarks in letters and essays:[5]

  • volume one would be a general theory of how human society functions, to be called Social Harmonies with chapters on things like responsibility, solidarity, self interest, perfectibility, morality, and legislation
  • volume two on his economic theory, to be called Economic Harmonies with chapters on topics much like we see in the published version but with additional chapters on taxation, the machinery question, free trade, on middlemen, raw materials and finished products, and on luxury
  • volume three on the disturbing factors or “disharmonies” which disrupted the harmonies discussed in the first two volume. Tis volume was to be called The History and Theory of Plunder with chapters on plunder, war, slavery, theocracy, monopoly, governmental exploitation, "false fraternity" or communism

Text

My dear Frédéric,

So the worst has happened; you have left our village.[6] You have abandoned the fields you loved, the family home[7] in which you enjoyed such total independence, your old books which were amazed to slumber neglected on their dusty shelves, the garden in which on our long walks we chatted endlessly de omni re scibili et quibusdam aliis,[8] [9] this corner of the earth that was the sanctuary of so many people we loved and where we went to find such gentle tears and such dear hopes. Do you remember how the root of faith grew green again in our souls at the sight of these cherished tombs? With what proliferation did ideas spring to our minds inspired by these cypresses? We had barely given thought to them when they came to our lips. But none of this could keep you here. Neither these good ordinary country folk who appeared before (your) court and were accustomed to seeking decisions in your honest instincts rather than in the (letter of the) law,[10] nor our circle (of friends)[11] (among whom we enjoyed so many) puns and jokes that two languages were not enough for (all of) them[12] and where gentle familiarity and long-standing intimacy replaced fine manners,[13] nor your cello[14] which appeared to renew constantly the source of your ideas, nor my friendship, nor this “absolute empire”[15] (which dominates) your actions, your waking hours, and your studies, (which is) perhaps the most precious of (your) assets. You have left the village and here you are in Paris, in this whirlwind where as Hugo says: … [16]

Frédéric, we are accustomed to speaking to each other frankly. Very well! I have to tell you that your resolution surprises me, and what is more, I cannot approve of it. You have let yourself be seduced by the love of fame, I do not go so far as to say (love of) glory and you know very well why.[17] How many times have we not said that from now on glory would be the prize only of minds of an immense superiority! It is no longer enough to write with purity, grace, and warmth; ten thousand people in France do that already. It is not enough to have wit; wit is everywhere. Do you not remember that, when reading the smallest article, so often lacking in good sense and logic but almost always sparkling with verve and rich in imagination, we used to say to one another, “Writing well is going to become a faculty common to the species, like walking and sitting well.” How are you to dream of glory with the spectacle you have before your eyes? Who today thinks of Benjamin Constant or Manuel?[18] What has become of these reputations which appeared imperishable?

Do you think you can be compared to such great minds?

Have you undertaken the same studies as they? Do you possess their immense faculties? Have you, like them, spent your entire life among exceptionally brilliant people? Have you the same opportunities of making yourself known, or the same platform; are you surrounded when need arises with the same comradeship? You will perhaps say to me that if you do not manage to shine through your writings you will distinguish yourself through your actions. I say, look where that approach has left La Fayette’s reputation.[19] Will you, like him, have your name resound in the old world and the new for three quarters of a century? Will you live through times as fertile in events?[20] Will you be the most outstanding figure in three major revolutions?[21] Will it be given to you to make or bring down kings? Will you be seen as a martyr at Olmultz[22] and a demigod at the Hôtel de Ville? Will you be the general commander of all the National Guard regiments in the kingdom? And should these grand destinies be your calling, see where they end: in the casting among nations of a name without stain which in their indifference they do not deign to pick up; in their being overwhelmed with noble examples and great services which they are in a hurry to forget.

No, I cannot believe that pride has so far gone to your head as to make you sacrifice genuine happiness for a reputation which, as you well know, is not made for you and which, in any case, will be only fleeting. It is not you who would ever aspire to become the great man of the month in the newspapers of today.

You would deny your entire past. If this type of vanity had seduced you, you would have started by seeking election as a deputy.[23] I have seen you stand several times as a candidate but always refuse to do what is needed to succeed. You used constantly to say, “Now is the time to take a little action in public affairs, where you read and discuss what you have read. I will take advantage of this to distribute a few useful truths under the cover of candidacy,” and beyond that, you took no serious steps.

It is therefore not the spur of amour-propre that drove you to Paris. What then was the inspiration to which you yielded? Is it the desire to contribute in some way to the well-being of humanity? On this score as well, I have a few remarks to make.

Like you I love all forms of freedom; and among these, the one that is the most universally useful to mankind, the one you enjoy at each moment of the day and in all of life’s circumstances, is the freedom to work and to trade. I know that the acquisition of property is the fulcrum of society and even of human life (itself). I know that trade is intrinsic to property and that to restrict the one is to shake the foundations of the other. I approve of your devoting yourself to the defense of this freedom whose triumph will inevitably usher in the reign of international justice and consequently the extinction of hatred, prejudice between one nation and another, and the wars that come in their wake.

But in fact, are you entering the lists with the weapons appropriate for your fame, if that is what you are dreaming of, as well as for the success of your cause itself? What are you concerned with, I mean really concerned with? A proof, and the solution to a single problem, namely: Do trade restrictions add to the profit column or the loss column in a nation’s accounts? That is the subject on which you are exhausting your entire mind! Those are the limits you have set around your great question! Pamphlets, books, brochures, articles in newspapers, speeches, all of these have been devoted to removing this gap in our knowledge: will freedom give the nation one hundred thousand francs more or less? You seem to be very determined to sweep under the carpet any insights which only shine indirect light on this theorem. You seem set on extinguishing in your heart all these sacred flames which a love for humanity once lit there.

Are you not afraid that your mind will dry up and wither with all this analytical work, this endless argumentation focused on mathematical calculations?[24]

Remember what we so often said: unless you pretend that you can bring about progress in some isolated branch of human knowledge or, rather, unless you have received from nature a cranium distinguished only by its imperious forehead, it is better, especially in the case of mere amateur philosophers like us, to let your thinking roam over the entire range of intellectual endeavor rather than enslave it to the solving of one problem. It is better to search for the relationships between the sciences and the harmony of the social laws, than to wear yourself out shedding light on a doubtful point at the risk of even losing the sense of what is grand and majestic in the whole.

This was the reason our reading was so varied and why we took such care in shaking off the yoke of conventional opinion. Sometimes we read Plato, not to admire him according to the faith of the ages but to assure ourselves of the radical inferiority of society in ancient times, and we used to say, “Since this is the height to which the finest genius of the ancient world rose, let us be reassured that man can be perfected and that faith in his destiny is not misguided.” Sometimes we were accompanied on our long walks by Bacon, Lamartine, Bossuet, Fox, Lamennais, and even Fourier.[25] Political economy was only one stone in the social edifice we sought to construct in our minds, and we used to say: “It is useful and fortunate that patient and indefatigable geniuses, like Say,[26] concentrated on observing, classifying, and setting out in a methodical order all the facts that make up this beautiful science. From now on, (our) minds can stand securely on this unshakeable base and lift ourselves up to (see) new horizons.” How much did we also admire the work of Dunoyer and Comte,[27] who, without ever deviating from the rigorously scientific line drawn by M. Say, applied with such delight these accepted truths to the domains of moral theory and legislation. I will not hide from you that sometimes, in listening to you, it seemed to me that you could in your turn take this same torch from the hands of your (intellectual) predecessors and cast its light in certain dark corners of the social sciences, above all in those which foolish doctrines have recently plunged into darkness.

Instead of that, here you are, fully occupied with illuminating a single one of the economic problems that Smith and Say have already explained a hundred times better than you could ever do. Here you are, analyzing, defining, calculating, and making distinctions. Here you are, scalpel in hand, seeking out what there is of worth in the depths of the words price, value, utility, high prices, low prices, imports, and exports.

But finally, if it is not for you yourself, and if you do not fear becoming dazed by the task, do you think you have chosen the best plan to follow in the interest of the cause? People are not governed by equations but by generous instincts, by feelings, and sympathy for others. It was necessary to show them the successive dismantling of the barriers which divide men into mutually hostile communities, into jealous provinces, or into warring nations. It was necessary to point out to them the merging of races, interests, languages, and ideas; the triumph of truth over error as a result of the collision between minds; progressive institutions replacing the regime of absolute despotism and hereditary castes; wars eliminated, armies disbanded, and moral power replacing physical force; and the human race preparing itself for the destiny reserved for it by uniting together. This is what would have impassioned the masses, and not your dry proofs.

In any case, why limit yourself? Why imprison your thoughts? It seems to me that you have subjected them to a prison diet of a single crust of dry bread as food, since there you are, chewing night and day on a question of money. I love commercial liberty as much as you do. But is all human progress encapsulated in that (one kind of ) freedom? In the past, your heart beat (faster) for the freeing of thought and speech which were still chained by the shackles imposed by the university system and the laws against free association. You enthusiastically supported parliamentary reform and the radical division of that sovereignty, which delegates and controls, from the executive power in all its branches. All forms of freedom go together. All ideas form a systematic and harmonious whole, and there is not a single one whose proof does not serve to demonstrate the truth of the others. But you act like a mechanic who makes a virtue of explaining an isolated part of a machine in the smallest detail, not forgetting anything. The temptation is strong to cry out to him, “Show me the other parts; make them work together; each of them explains the others. ..”[28]

 


 

A Lecture on Free Trade and related Economic Questions (3 July 1847)

Source

"Réunion de la rue Taranne," Le Libre-échange, 4 July 1847, no. 32, pp. 252-53.[29] This was republished as “Troisième discours, à Paris” (Third Speech given in Paris at the Taranne Hall) (3 juillet 1847) [OC2.44, p. 246]. The OC version did not include the introduction and conclusion which we reproduce here. The LE version contained material by the unnamed editor who signed the article “J.”

Text

[Introduction by one of the editor’s of Le Libre-échange.]

Last Wednesday evening (3 July 1847) a large group of young gentlemen, most of whom came from the School of Law, squeezed into the hall at no. 12 Taranne street to hear M. Frédéric Bastiat. He had offered to speak to the young students from the (law and medical) schools[30] about some general observations concerning the subject of free trade, which has been so poorly studied up until now and thus so poorly understood. M. Bastiat wished above all to demonstrate the necessity of adhering to (matters of) principle, every time one touched on matters with the gravity of those dealt with by the (French) Free Trade Association); and (to expose) the inconsistencies into which the partisans of trade protection were led by their system (based upon) expediency. M. Bastiat then showed the connection which existed between discussions about the question of free trade and those of several other social problems of great interest, as well as the usefulness that youth (such as them) would find in making it the subject of their attention. The audience followed this exposition with great attention and an interest which was truly encouraging for the speaker. When M. Bastiat had finished the audience showed its appreciation with unanimous applause.

Below are some passages from M. Bastiat’s lecture.

Gentlemen,

For some time now I have very much wanted to be here with you. On many occasions when I was intellectually sure of the evidence and felt the need to express myself, which is an integral part of any belief with regard to questions of interest to the human race, I have said to myself: “Why can I not speak to the young people in the universities, for words are the seed that sprouts and bears fruit, especially in young minds.” The more you observe the ways of nature, the more you admire the harmony of their interconnections. For example, it is perfectly clear that the need for education is felt more keenly at the start of life. For this reason, you can see with what amazing industry life has placed the capacity and desire to learn at this time and not just ensured the suppleness of our mind, the freshness of our memory, the prompt assimilation of concepts, the power of attention, and the physiological qualities that are the fortunate privilege of (people) your age, but also the indispensable moral aptitude of discerning the true from the false, and by this I mean (a sense of) disinterestedness.[31]

Far be it fo me to satirize the generation to which I belong. However, I may say, without causing it offence, that it is less capable of shaking off the yoke of the errors that dominate (it). Even in the natural sciences, those that do not affect (our) passions, progress finds it very hard to be accepted. Harvey[32] used to say that he had never encountered a doctor more than fifty years old who wanted to believe in the circulation of the blood. I use the word “wanted to’ because, according to Pascal, “the will is one of the major organs of belief.”[33] And as interest acts on the disposition of (the) will, is it surprising that men whose age confronts them with the difficulties of life, who have reached the time (in their life) to take action, who act in accordance with deep-rooted convictions, and who have carved out for themselves a path in the world, reject instinctively a doctrine that might upset their arrangements and in the end only believe in what it is useful for them to believe?

This is not the case for the age group whose goal is study and examination. Nature would have gone against its own plans, if it had not made this age group disinterested. For example, it is possible that the doctrine of free trade upsets the interests of a few of you or at least of your families. Well, then! I am certain that this obstacle that is insurmountable elsewhere is not an obstacle in this hall. This is why I have always wanted to come here to discuss things with you.

And yet as you will understand, I cannot consider going into the detail or even dealing with the question of free trade today. One session would not be enough. My sole object is to show you how important it is and how closely linked it is with other extremely serious matters, in order to generate in you the desire to study it.

One of the most frequent accusations made against the Association for Free Trade[34] is that it does not limit itself to demanding a few timely modifications of the tariffs, but proclaims the very principle of free trade. This principle is scarcely contested; it is respected and saluted when it passes, but it is allowed to pass by. (However), people do not want it at any price, nor any of those who support it. What decided me to choose this subject are the events that have just occurred in a recent election[35] and which may be summarized in the following dialogue between the electors and the candidate:[36]

“You are an honorable man; your political opinions are the same as ours. Your character inspires us with total confidence and your past record is a guarantee to us of your future behaviour; however, you want to reform the tariffs.”

“Yes.”

“We want that too. You want it to be prudent and gradual.”

“Yes.”

“We see it this way too. But you link it to a principle, which you express in the words, free trade.”

“Yes.”

“In that case you are not the man for us. (Laughter) We have a host of other candidates who promise us both the advantages of freedom and the comforts of (trade) restriction. We will choose one of them.”

Gentlemen, I believe that one of the great misfortunes and great dangers of our age is this inclination to reject principles,[37] which after all are just the logical reasoning of the mind. In rejecting these, men of conviction are discouraged (from seeking office). They are led to insert into their election manifestos ambiguous phrases intended to satisfy, or at least half-satisfy, the most conflicting opinions. You cannot enter into public life through this door without sullying the purity of your conscience. I know full well how a candidate faced with these requirements reasons. He tells himself: “Just this once I will abandon the principle and resort to expediency. It is a question of winning. But once I have been nominated I will go back to the full sincerity of my convictions.” Yes, but when you have taken the first step along the dangerous path of compromise, there is always a good reason for deciding to take a second until in the end, even when external circumstances allow you full freedom of action, the evil has penetrated into conscience itself, and you find that you have stepped down from the level of rectitude you would have wanted to maintain. And see the consequences! Complaints are made on all sides and people say: “The conservatives have no plan and the opposition have no programme. If you go back to the cause, perhaps you will find it in the minds of the electorate itself, which requires candidates to renounce principles, that is to say, any fixed idea, any logic, and any belief.

And certainly, if there is one right that can be claimed as a right, that is to say that conforms to a principle, it is truly the freedom to trade.

As we have said in our (Free Trade) manifesto, we consider trade not only as a corollary of property, but as something that is an integral part of property itself, one of its constituent elements.[38] It is impossible for us to consider as a property (right) in the things that two men have respectively created by their own work if these two men do not have the right to exchange them, even if one of them is a foreigner. And, as for the harm to the nation that, it is said, will result from this exchange, we cannot understand how you damage your country by selling to a foreigner the very thing that you have the right to consume and destroy, in return for an object of equivalent value.

I will go further. I state that trade is synonymous with Society.[39] What constitutes the sociability of men is the ability to divide up their occupations and join forces with each other, in a word, to exchange their services. If it were true that ten nations could increase their prosperity by isolating themselves from each other, this would also be true for ten departments. I challenge protectionists to produce an argument in favor of work at the national level that cannot be applied to work at the departmental level, the communal level, the family level, and finally the individual level, from which it follows that (trade) restriction, when taken to the limit, (results in) absolute isolation and the destruction of society.[40]

Our opponents, it is true, say that they do not go that far, that they restrict trade only in certain circumstances and when it suits them to do so. This is no justification for logical minds. Where we challenge them is not where they leave trade free, but where they forbid it. It is within these limits that we declare their principle to be false, harmful, an infringement of property (rights), and detrimental to society. They do not push it to the limit, it is true, and this is precisely what proves the absurdity that fails to support this proof.

You can see clearly that we are faced with a false principle. And with what can we oppose it, if not one that is true?

But, Gentlemen, I am one of those who think that when an idea has permeated a large number of people of good sense, when a sentiment, even one that is instinctive, is generally widespread, there must be something in these minds that explains and justifies them. This terror of free trade,[41] considered to be an absolute principle, a terror that has taken over the very people who want trade reform, has arisen from a misconception. Allow me to clear it up.

People assume that to want free trade in principle is to want trade not to be subject to restriction in any circumstances and under any pretext.

First of all, let us set aside trade that is immoral, fraudulent, and dishonest. It is the principal mission of the law and the right and duty of the government to repress any abuse of any activity, that of trade along with all the rest.

As for trade that does not contravene honesty, it may be restricted, we agree, for an exceptional reason. The principle is engaged only where (trade) restriction is decreed because of the advantage that is claimed to be found in (the) restriction itself.

If, for example, the state requires revenue[42] and cannot acquire enough by less burdensome means than taxing certain forms of trade, it is impossible to say that this tax contravenes the principle of freedom, any more than land taxes invalidate the principle of (private) property.[43] However, in this case everyone acknowledges that (trade) restriction is an inconvenience that is linked to the levying of the tax. From this to (having trade) restriction(s) for the sake of restricting trade, there is an infinite difference.

The carrying of letters is taxed on average at 45 centimes, and if I am not mistaken, brings 20 million francs into the Treasury.[44] But the Minister of Finance has never said that he has raised the tax to this level to prevent people from writing because communication by letter is intrinsically a bad thing. If he were able to count on the same revenue from a lower rate of tax, he would not hesitate to reduce it. But what would you think if he came to the rostrum to say: “It is disastrous in principle for people to write to each other and to prevent this, even at the sacrifice of the 20 million francs that I raise from this tax, I will increase it to 10, 50 or 100 francs, up to a level at which nobody would write any more letters. And as for the current revenue which would be compromised, I will compensate for it by inflicting other taxes on the people.”?

Gentlemen, do you not see that between this prohibitive tax and the current rate of tax there lies the principle itself, since, in the first case, people deplore that the tax restricts communicating by letter and in the second, on the contrary, the aim has been to destroy this communication systematically.

And this is the characteristic that we are combating in the Customs Service.[45] It restricts and prohibits (trade), not for any particular reason, such as to create resources for the Treasury, but on the contrary, it sacrifices Treasury revenue through an excessively high level of taxes, and even through prohibition, with the avowed, intentional, and systematic aim of preventing trade. As long as it acts in this way, it is expressly based on the anti-social principle of restricting trade. It seeks trade restriction for its own sake, considering it to be intrinsically good, and even so good that it warrants the pain of a sacrifice in revenue. It is to this principle that we are opposing the principle of freedom.

People are still looking for a way to alarm and terrify the general public by assuring them that what we want is to pass from one system to the other with no transition (period). What nonsense! And for how long will France be taken in by these strategic maneuvers by people who exploit (trade) restrictions?

All that we want is to make public opinion understand that the principle of freedom is just, true, and beneficial, and that the principle of (trade) restriction is iniquitous, false, and damaging.

We have never said and will never say that when you have taken the wrong path, you have to cover the distance separating you from the right path in a single leap.[46] What we say is that you have to turn around and retrace your steps, going toward the east instead of continuing to advance toward the west.

And should we demand instant reform, does this reform depend on us? Are we ministers (in the government)? Do we have a majority? Do we not have enough opponents and enough (vested) interests facing us to be sure that the reform will be slow, only too slow?

In what direction should we move? Should we move fast or slowly? These are two questions that are quite separate from one another, and which are not even linked. They are so little linked that, even though within our organization we all agree on the goal to be attained, we may have differing opinions on a suitable length of time for the transition. What we are unanimous about is to say that, since France is going down the wrong road, it has to be brought back with as little disturbance[47] as possible. The immense majority of our colleagues consider that this disturbance will be all the less if the transition is slow. Others, of whom I must admit that I am one, believe that the most sudden, instantaneous, and general reform would also be the least painful, and if this were the occasion to develop this thesis, I am sure that I would base it on reasons that you would find striking. I am not like the man from Champagne who told his dog: “Poor animal, I have to cut your tail off but do not worry, to spare you suffering I will organize the transition and will only cut a bit off every day.”[48]

However, and I repeat, the question for us is not to ascertain how many kilometers the reform will cover per hour; the only thing that concerns us is to persuade public opinion to take the route to freedom instead of the one to restriction. We see a coach team that claims to be going to the Pyrénées and which, in our view, is going in the opposite direction. We warn the coachman and the passengers, and in order to correct their error we make use of all we know of geography and topography; that is all.

There is one difference, however. When we prove to a coachman that he is mistaken, his error suddenly disappears, and he turns around as soon as he can. This is not true for trade reform. It can only follow the progress of public opinion, and in these matters this progress is slow and comes in stages. You can thus see that, as we ourselves admit, instantaneous reform, even if it were desirable, is impossible.

In the long run, Gentlemen, I am not too worried by this, and I will tell you why. It is because the enlightened minds that will be concentrated on the question of free trade through prolonged discussion will of necessity shed light on other economic questions that are extremely closely linked to free trade.

I will cite you a few examples.

For example, you know the old saying:[49] One man’s profit is another man’s loss.[50] The conclusion has been drawn that one nation can prosper only at the expense of other nations, and international politics, it has to be said, is based on this sorry maxim. How has this managed to become part of public certainty?

There is nothing that modifies the organization, institutions, customs, and ideas of a nation as profoundly as the general means through which they provide for their existence,[51] and there are just two of these means: plunder, taking this word in its widest sense, and production. For, Gentlemen, the resources that nature spontaneously offers people are so limited that they are able to live only on the products of human work, and they have either to create these products or take them by force from other people who have created them.[52]

The nations of antiquity, and in particular the Romans,[53] in whose company we have spent our entire youth and whom we have been accustomed to admire and constantly incited to imitate, lived from pillage. They detested and scorned work. War, loot, tribute, and slavery had to provide all that they consumed.

This was also true of the nations that surrounded them.

It is obvious that, in this social order, the maxim “one man’s profit is another man’s loss” was quite literally true. This has to be so between two men or two nations who seek to plunder each other reciprocally.[54]

Well, as we seek all of our initial impressions and ideas, all of our models and the subjects of our quasi-religious veneration from the Romans, it is hardly surprising that this maxim has been considered by our industrial societies as being the law governing international relations.

It forms the basis for the system (of trade restrictions), and if it were true, there would be no remedy for the incurable antagonism that it would have pleased Providence to instill in nations.

However, the doctrine of free trade demonstrates rigorously and mathematically the truth of the opposite axiom, which is: “Harm to one is harm to the other, and each nation has an interest in the prosperity of all.”[55]

I will not go here into this proof, which, incidentally, results from the sole fact that the nature of trade is quite opposite to that of plunder. But your wisdom will enable you to grasp instantly the major consequences of this doctrine and the radical change that it would introduce into the policies of nations if it managed to win their universal assent.

If it were properly proven, as a geometrical theorem is proven, that even though it upsets those who carry out a similar industry in other nations, any progress made by a nation in a particular sector of industry is nonetheless favorable to their interests as a whole, what would happen to the dangerous efforts to achieve pre-eminence, the jealousies between nations, the wars to obtain markets, etc. and consequently, the standing armies,[56] all of which are without doubt the remnants of savagery?

[Editorial interjection: The speaker at this point mentions a few questions of extreme gravity on which a discussion on free trade ought to shed a clear light, one of which is the fundamental problem of political science: What ought the limits of government action to be?][57]

By calling your attention to some of the serious problems raised by the question of free trade, I wanted to show you the importance of this question and the importance of economic science itself.

For some time, a number of writers have risen up against political economy, and they believed that to decry it it was enough to change its name. They called it economism.[58] Gentlemen, I do not think that the truths proved by geometry would be shaken by calling it geometrism.

It is accused of concerning itself only with wealth, and thus to drag the human mind down to the ground. It is especially in front of you (today) that I am determined to rid it of this criticism, for you are of an age at which it is natural to make a vivid impression.

First of all, even if it were true that political economy concerned itself exclusively with the way in which wealth was formed and distributed, this would already be a vast science if the word wealth is taken in its accepted scientific meaning and not in its popular one. In popular thinking, the word wealth implies the notion of superfluous (or unnecessary) things. Scientifically, wealth is the total number of reciprocal services[59] that people render to each other and through which society exists and develops. The progress of wealth means more bread for those who are hungry and clothing that not only protects from extremes of weather but also gives people a feeling of dignity. Wealth means more leisure time,[60] and consequently intellectual culture. For a nation it provides the means of repelling foreign aggression, for old people, ease in their retirement, and for a father, the ability to educate his son and provide a dowry for his daughter. Wealth is well-being, education, independence, and dignity.

But if it was considered that even in this expanded sphere political economy is a science that is too concerned with material interests, sight should not be lost of the fact that it leads to the solution to problems of a higher order, as you may have been persuaded when I called your attention to the following two questions: Is it true that one man’s profit is another man’s loss? What is the rational limit to the action of government?

But what will surprise you, Gentlemen, is that the socialists, who criticize us for being too concerned with the goods of this world, themselves show an exclusive and exaggerated cult of wealth in the opposition they put forward to free trade. What do they in fact say? They agree that free trade would have highly desirable results from a political and moral point of view. Nobody will deny that free trade tends to bring nations together, extinguish national hatreds, consolidate peace, and encourage the communication of ideas, the triumph of peace, and progress toward unity. What is the basis for their rejection of this freedom? The sole basis is that it would damage national labour, subject our industries to the inconveniences of foreign competition, decrease the well-being of the masses, or in a word, (our) wealth.

Faced with this objection, are we not obliged to deal with the economic question and demonstrate that our opponents are viewing competition from just a single angle and that free trade has as many advantages from a material point of view as from all the others? And when we do this we are told: “You are concerned only with wealth; you give too much importance to wealth.”

[Editor’s interjection: After having rejected the criticism made of political economy that it is a science imported from England, the speaker ends with the following words:]

Gentlemen, I will stop here, and perhaps I have already taken too much advantage of your patience. I will end by urging you with all my strength to devote a few moments of your leisure time to the study of political economy. Allow me to give you a further piece of advice. If ever you become members of the Free Trade Association or any other (group) with a goal that is of great public utility, do not forget that debates of this nature have public opinion[61] as their judge and that they want to be supported on the grounds of principle and not on that of expediency. I call “expediency,” as opposed to “principle,” the inclination to judge questions from the point of view of the circumstances of the moment, and even all too often from those of the interests of a class or (the interests of particular) individuals. An association needs a bond, and this bond can only be a principle. The mind needs a guide and enlightenment, and this can only be a principle. The human heart needs motivation to determine action, dedication, and sacrifice if need be, and you do not dedicate yourself to an expedient, but to a principle. Look at history, Gentlemen, and you will see the names that are dear to the human race and recognize that they are those of men driven by an ardent faith. I despair for my century and my country when I see the honor given to expediency, and the derision and ridicule reserved for principle, for nothing fine and beautiful has been accomplished in the world other than by dedication to a principle. These two forces are often in conflict, and it is all too frequent to see the man who represents matters of the moment triumph and the one that represents a general idea fail. Nevertheless, look further afield and you will see principle achieving its goal and expediency leaving no trace of its passage.

Religious history offers a wonderful example of this. It shows us principle and expediency confronting one another in the most memorable event ever witnessed by the world. Who has ever been more fully devoted to a principle, the principle of fraternity, than the founder of Christianity? He was devoted to the point of suffering persecution and scorn, abandonment and death for it. He did not appear to be concerned with the consequences but placed them in the hands of His Father, saying: “Thy will be done.”

The same story shows us the man of expediency side by side with this model. Caiaphas, fearing the fury of the Romans, compromises his duty, sacrifices the just, and says: “It is expedient (expedit) that one man should perish for the salvation of all.”[62] The man of compromise triumphs while the man of principle is crucified. But what was the result? Half a century later, the entire human race, Jews and Gentiles, Greeks and Romans, masters and slaves rallied to the doctrine of Jesus, and if Caiaphas had been alive at this time he might have seen a plow pass over the site on which the Jerusalem that he thought he had saved by a cowardly and criminal compromise once stood. (Prolonged applause).

[Concluding comments by editor “J.”:]

Just as our colleague finished, M. Jules Duval asked him if he would agree to allow a follower of socialism (like him) to make a few observations. As he was speaking he moved from the back of the hall where he had been seated towards the table where M. Bastiat had been sitting. M. Bastiat replied that he had only spoken about socialism very indirectly and only to support some of his points, and that he hadn’t even wanted to plumb the depths of the question of free trade at this meeting; and having said this he ceded the floor to M. Jules Duval.

M. Duval is one of the principle editors of La Démocratie pacifique, the daily paper for that “Social Science” discovered by Fourier.[63] We quickly realized that he had come to make a series of criticisms against the present organization of society and against the school of economics which he believed to be the author and the defender of everything which happens in the world. Free trade wasn’t ignored in this general criticism, and for the three quarters of an hour for which he spoke, he had the talent to summarize all the arguments which our opponents make against us on a daily basis. Nevertheless, (our) Phalansterian speaker granted that the free trade doctrine (would produce) (much) bounty and richness (only) when it had been remade and reorganized upon the basis of “Social Science.”

We are happy to acknowledge that M. Jules Duval spoke with real talent, but his speech, we also have to say, had no relationship to M. Bastiat’s, who had treated none of the points that he (Duval) had come to address and refute. We will add that all the arguments of M. Jules Duval are far from agreeing with the principles of the school to which he belongs, and that he seems to us to (have) been far too preoccupied with the desire to defend the protectionist party, whose views he faithfully reproduced.

Having seen that the hour was late, M. Frédéric Bastiat was not able to rebut the numerous claims made by M. Jules Duval. He limited himself to giving his listeners a copy of his book Economic Sophisms[64] in which he has undertaken (the task of) uprooting the grossest errors of the doctrine of protectionism. The meeting adjourned and each of the young gentlemen accepted a copy of this work and showed by their enthusiasm their desire to deepen their knowledge of the important questions to which their attention had been called.

 


 

A Note on Economic and Social Harmonies (c. early 1850)

Source

Undated note by Bastiat on the “Economic and Social Harmonies” found among his papers (c. June 1845). Ronce, pp. 227-8. It can also be found quoted in Fontenay’s “Notice” in OC1 (1862) and the Foreword to the 2nd ed. of Economic Harmonies (1851).[65]

Text

I had originally thought to begin with an exposition of the Economic Harmonies[66] and as a result to treat only purely economic subjects, such as value, property, wealth, competition, wages, population, money, credit, etc. Later, if I had had the time and the energy, I would have called the reader’s attention to a much larger subject, the Social Harmonies. It is here that I would have talked about human nature, the driving force of society,[67] responsibility, solidarity,[68] etc. … Having conceived the project in this fashion I had commenced work on it when I realised that it would have been better to merge rather than to separate these two different kinds of approaches. But then logic demands that the study of mankind should precede that of economics. However, there was not enough time: how I wish I could correct this error in another edition!… [69]

 


 

2. Economic Harmonies (1850 ed.)

 

To the Youth of France

A love of study, a need for something to believe in, a mind free from deeply rooted prejudice, a heart free of hatred, a zeal for spreading ideas, warm feelings towards one’s fellow beings, impartiality, self-sacrifice, good faith, an enthusiasm for all that is good, beautiful, simple, great, honest, religious: such are the precious attributes of youth. This is why I am dedicating this book to them. It will indeed be a sterile seed if it does not take root in the generous soil to which I am entrusting it. 

I would have liked to offer you a (fuller) picture, but I am just giving you a sketch; (so) forgive me. Who can succeed in creating a work of some importance these days? This is an outline. When you see it, may one of you cry out, like the great artist: “Anch’ io son pittore![70] and seizing the brush, put color and flesh, light and shade, feeling and life onto this shapeless canvas. 

Young people, you will find the title of this book very ambitious. Economic Harmonies! Have I aspired to reveal the plans of Providence in the social order and the (social) mechanism[71] of all the forces provided to the human race for the achievement of progress? 

Certainly not, but I would like to set you on the path to this truth: that All legitimate interests are harmonious. This is the dominant idea in this book, and it is impossible not to recognize its importance. 

It may have been fashionable for a while to laugh at what is called the social problem,[72] and it must be said that some of the solutions put forward were only worthy of some mocking laughter. But as for the problem itself, there is certainly nothing funny about it. It is the ghost of Banquo at Macbeth’s feast,[73] but it is not a mute ghost, and in a stentorian voice it cries out to a terrified society: Find a solution on pain of death! 

Well, this solution, as you will easily understand, has to be very different, depending on whether (our) interests are naturally in harmony or in conflict. 

In the first case, we must call for freedom, in the second, for coercion. In the first case it is enough not to interfere, in the other, you have to interfere out of necessity. 

But freedom has just one form. When people are fully convinced that each of the molecules that make up a liquid carry within itself the force that results in the (liquid finding its own) level, they conclude that there is no simpler or surer means of obtaining this level than not to interfere with it. All those, therefore, who adopt as their staring point, (the idea that) Interests are in harmony, will also agree on the practical solution to the social problem: refrain from impeding and displacing these interests. [74]

By contrast, coercion manifests itself in an infinite number of forms and points of view. The schools of thought that start from the presupposition that Interests are in conflict, have therefore not yet done anything to solve this problem except for excluding freedom. It still remains for them to identify from the infinite number of forms of coercion the one that is right, if there can indeed be one. Then, as a final difficulty, they will still have to have this preferred form of coercion universally accepted by people, by freely acting individuals.[75]

However, within this perspective, if human interests are impelled by their (very) nature toward a fatal clash, and this clash cannot be avoided except by the chance invention of an artificial form of social order,[76] the fate of the human race is in extreme jeopardy, and the following questions are raised in fear and trembling: 

1. Will we ever find a man who finds an acceptable version of coercion?

2. Will this man rally to his way of thinking all the countless schools of thought that have conceived different versions? 

3. Will the human race allow itself to be subjected to this (version) which, according to the assumptions espoused, will be at odds with all individual interests?

4. Assuming that the human race allows itself to be attired in this particular garment, what will happen when a new inventor comes along with (an) even better one?[77] Should it continue with a bad system, knowing it to be bad, or should it take the decision to change the arrangements every morning in line with the whims of fashion and the fertile imaginations of inventors?

5. Won’t all the candidates whose plans have been rejected band together against the plan selected, with all the more chance of upsetting society because this plan, by its very nature and aim, ruffles all types of interest?

6. And, in the final analysis, is there a human force capable of overcoming a conflict thought to constitute the very essence of human forces? 

I could multiply these questions indefinitely and, for example, raise the following difficulty: 

If individual self-interest is opposed to the general interest, where would you place the source of the coercion? Where would its fulcrum lie? Would it be outside the human race? It would have to be if it were to escape the consequences of your central principle. For in order to entrust arbitrary power to men, you would have to prove that, the men in question are made of a different clay from (the rest of) us, that they are not also moved by the fatal principle of self-interest, and that if they were placed in a situation excluding any idea of (there being) a brake on or any effective resistance to (their power), their minds would be free from any kind of error, their hands free from greed, and their hearts from any covetousness.[78]

What separates the various socialist schools[79] (by which I mean those that seek an artificial system of organization to cure the problem of society) radically from the school of the economists[80] is not this or that view of points of detail, this or that set of government arrangements, but the point of departure, the following preliminary and over-riding question: Are the interests of human beings, when left to themselves, in harmony or in conflict? 

It is clear that socialists have been in a position to start seeking an artificial system of organization only because they considered the natural system to be bad or inadequate, and that they have judged the natural system to be inadequate or bad only because they thought they could see a fundamental conflict of interests, for if this were not the case they would not have had recourse to coercion. It is not necessary to force harmony on something intrinsically harmonious. 

For this reason, they have seen conflict everywhere:

Between (the factory) owner and the proletarian,

Between capital and labor,

Between the people and the bourgeoisie,

Between agriculture and manufacturing,

Between country and city dwellers,

Between the native born citizens and foreigners,

Between producers and consumers,

Between civilization and organization[81]

In a word,

Between freedom and harmony.

And this explains how it can be that, while a kind of sentimental philanthropy dwells in their hearts, hatred flows from their lips. Each of them reserves his entire stock of goodwill for the society of his dreams, but as for the one in which we must live, for them it could not be overturned soon enough and thus make way for the new Jerusalem which will arise from its ashes.

I have said that the school of the economists, setting out from the premise of natural harmony of interests, has declared in favor of freedom.

However, I have to agree that while economists in general are in favor of freedom, it is unfortunately not equally true that their principles (have) established the starting point firmly enough, namely, the harmony of interests. 

Before going any further, and in order to warn you against the inferences that this admission is bound to generate, I have to say something about the respective situations of socialism and political economy. 

I would be foolish to say that socialism has never come up with any truth or that political economy has never fallen into error. 

What profoundly separates the two schools of thought is the difference in their methods. One, like astrology and alchemy, proceeds by imagination; the other, like astronomy and chemistry, proceeds by observation. 

Two astronomers observing the same fact may not come to the same conclusion. 

In spite of this temporary disagreement, they feel bound by the common form of procedure that, sooner or later, will bring the disagreement to an end. They recognize that they are members of the same denomination. But between the astronomer who observes and the astrologer who imagines, the abyss is unbridgeable, even though they may sometimes meet by chance.

This is also true for political economy and socialism. 

Economists observe man, the laws of his nature, and the social relations that arise from these laws. Socialists think up a novel society and then (invent) a human heart to fit it 

Well, if science does not make mistakes, scholars do. I do not deny, therefore, that economists can make false observations, and I even add that of necessity they must have started (off) by doing so.  

However, this is what happens. If interests are in harmony it then follows that any observation incorrectly carried out leads logically to (the conclusion that there is) conflict. What then is the tactic of the socialists? It is to cull from the writings of the economists a few incorrect observations, show their full consequences, and prove how disastrous they are. Up to this point, they are within their rights. They then rail against the observer, let’s say for example, Malthus or Ricardo.[82] They are still within their rights. But they do not stop there. They turn against (economic) science (itself), accusing it of being heartless and wanting harm[83] to occur. In doing this, they come up against reason and justice, for science is not responsible for observation (which is) badly carried out. Finally, they go very much further. They put the blame on society itself and threaten to destroy it in order to rebuild it, and why? Because, they say, science has proved that the current form of society is being driven toward an abyss. In doing this, they are contravening common sense, for either science does not make mistakes, so in this case why are they attacking it, or else it does makes mistakes, and so in this other case, let them leave society alone since it is not in jeopardy. 

However, this tactic, illogical as it is, is nonetheless disastrous to economic science, especially if those working in it have the unfortunate habit of supporting each other’s ideas and the ideas of those who have gone before (in an uncritical fashion). Economic science is a queen whose allures ought to be frankly and freely discussed. The closed atmosphere which surrounds a clique will kill it.[84]

I have already said that it is not credible that any mistake in political economy must inevitably lead to conflict. On the other hand, it is impossible for the many articles written by economists, even the most eminent, not to include some wrong propositions. It is up to us to point them out and put them right in the interest of economic science and society. To persist stubbornly in supporting them for reasons of defending the honor of the school would be not only to expose ourselves, which is unimportant, but also to expose truth itself, which is more serious, to the blows of socialism.

I (will) return to my subject, therefore, and state: Economists advocate freedom. However, in order for this conclusion to obtain the approval of the hearts and minds (of others), it has to be firmly based on the following premise: Interests, (when) left to themselves, tend to form harmonious arrangements and tend to advance the general well-being in a progressive manner. 

Well, several of these economists, among those whose authority is recognized, have advanced propositions that, step by step, lead logically to (the conclusions that) absolute evil (exists), (that) injustice is inevitable, that there is a fatal inequality which will get progressively worse, that pauperism is inevitable, etc. 

This being so, there are very few, to my knowledge, who have not attributed value to natural resources (which are) the gifts that God has lavished on His creatures free of charge.[85] The word value implies that what contains it is handed over by us only in return for payment. You therefore have men, in particular landowners, selling the gifts of God in exchange for real labor and who are receiving payment for useful things in which their work has played no part. This is an obvious but necessary injustice, say these writers.[86]

Next we have the famous theory (of rent)[87] of Ricardo.[88] It can be summarized in this way:[89] The price for food is based on the labor needed to produce them on the poorest land being cultivated. Now, an increase in population obliges us to resort to increasingly infertile soil. For this reason, the entire human race (except for the landowners) is obliged to provide an ever-increasing amount of labor in exchange for the same quantity of food or, which amounts to the same thing, to receive an ever-decreasing quantity of food for the same amount of labor. At the same time, landowners see their rents increase each time land of lower quality is worked. The conclusion: The gradual increase in the opulence of men of leisure and the gradual impoverishment of working men, resulting in a fatal inequality. 

Finally, Malthus’ even more famous theory (of population)[90] appeared.[91] Population tends to increase faster than the means of subsistence, and this has been true at every stage of existence of the human race. Well, people cannot be happy and live in peace if they do not have enough to eat. There are just two obstacles to this constantly menacing population surplus: a decrease in the birth rate or an increase in the mortality rate in all the dreadful forms in which this occurs. Moral constraint has to be universal if it is to be effective and nobody relies on this. For this reason, all that remains is the repressive or positive check:[92] namely, vice, poverty, war, plague, famine, and death, resulting in an inevitable pauperism.

I will pass over other less wide-ranging accounts which also result in a hopeless impasse. For example, Mr. de Tocqueville[93] and many like him say: If we accept the right of primogeniture[94] we come to an ever more concentrated form of aristocracy, and if we do not, we come to the division of land into smaller and smaller fractions and to a decrease in its productivity.[95]

And what is remarkable is that these four dreadful systems do not clash with one another. If they clashed we might console ourselves by thinking that they are all wrong, since they destroy one another mutually. On the contrary, they agree and form parts of the same general theory, which, supported by a number of plausible facts, appears to explain the convulsed state of modern society and, with the strong approval of several masters of economic science, presents itself to downcast and dejected minds, with terrifying authority.  

It remains to be understood how the advocates of this sorry theory have been able to put forward the harmony of interests as a principle and freedom as a conclusion. 

For it is clear that if the human race is fatally driven by the laws of value toward injustice, by the laws of rent toward inequality, by the laws of population toward poverty, and by the laws of inheritance toward the dying out of the species, then it should not be said that God has made the social world, like the physical world, a work of harmony; we have to admit with bowed heads that He was pleased to base it on a repulsive and incurable disharmony.[96] 

Young people, you should not think that the socialists have refuted and rejected what I will call, so as not to offend anyone, the theory of disharmony.[97] No, whatever they say, they have held it to be true and it is precisely because they hold it to be true that they propose coercion as a substitute for freedom, an artificial form of organization for a natural form, and work of their own invention for the work of God. They tell their opponents (and in this, I do not know if they are not more consistent than the latter): If, as you have announced, human interests when left to themselves tend to combine harmoniously, we would have nothing better to do than to welcome and praise freedom, as you do. However, you have demonstrated incontrovertibly that if interests are left to develop freely, they propel the human race toward injustice, inequality, impoverishment, and dying out. Well then, we react against your theory precisely because it is true. We want to destroy society as it is today precisely because it obeys the fatal laws you have described. We want to try out our power since the power of God has failed. 

Thus, we agree on the starting point and only the conclusion separates us. 

The Economists to whom I refer say: The great laws of Providence are hurling society toward disaster; but you have to be careful not to disturb their action because this action is fortunately counteracted by other secondary laws,[98] which delay the final catastrophe, and any arbitrary intervention would only weaken the dam without stopping the fatal rising of the waters.

The Socialists say: The great laws of Providence are hurling society toward disaster; they have to be abolished and others chosen from our inexhaustible arsenal. 

The Catholics say: The great laws of Providence are hurling society toward disaster; we have to escape from them by renouncing human self-interest and taking refuge in self-denial, sacrifice, asceticism, and resignation. 

And, in the midst of this tumult, the cries of anguish and distress and the calls for subversion or for resigned despair, I am attempting to make the following statement heard, in the face of which, if it is justified, all disagreement ought to fade away: It is not true that the great laws of Providence are hurling society toward disaster

Thus, all the schools of thought are divided and oppose one another with regard to the conclusions that have to be drawn from their common premise. I deny this premise. Is this not the way to stop the division and conflict? 

The dominant idea in this work, the harmony of interests, is simple. Is not simplicity the touchstone of truth? The laws governing light, sound, and movement appear to us to be all the more true because they are simple; why should this not be the case for the law governing our self-interest? 

It is conciliatory. What is more conciliatory than that which shows the agreement which exists between industries, classes, nations, and even doctrines? 

It is consoling, because it points out what is wrong in the systems whose conclusion is that harm gets progressively worse. 

It is religious, because it tells us that it is not only the workings of heaven but also those of society that reveal the wisdom of God and tell of His glory. 

It is practical, and certainly nothing more easily put into practice than this can be conceived: Let us leave people (free) to work, exchange, learn, form associations with each other, and to act and react with one another, since, in accordance with providential decree, nothing other than order, harmony, progress, good, more good, and even more, indeed infinite good can flow from people’s thoughtful spontaneity.

“Here is a good example,” you will say, “of economists’ optimism![99] They are such slaves of their own systems that they shut their eyes to the facts for fear of seeing them. Faced with all the poverty, injustice, and oppression that afflicts the human race, they calmly deny the existence of evil. The whiff of gunpowder during insurrections does not reach their blasé senses.[100] The cobblestones of the barricades are not part of their vocabulary, and when society crumbles they will still be crying ‘Everything is for the best in the best of all worlds.’ ”[101]

No, certainly, we do not think that everything is for the best. 

I do have total faith in the wisdom of providential laws, and for this very reason I have faith in freedom. 

The question is to ascertain whether (or not) we have freedom. 

The question is to know whether these laws can act to their full effect or if their action is not profoundly impaired by (some) opposing action from human institutions.

Denying the existence of harm! Denying the existence of suffering! Who could do such a thing? You would have to forget that we were speaking about human beings. You would have to forget that we ourselves are human beings. For the laws of providence to be held to be harmonious, it is not necessary for them to exclude harm. It is enough for this harm to have an explanation and a purpose, for it to be be self-limiting, for its own action to destroy it, and for each suffering to prevent a greater suffering by eliminating its own cause.[102] 

The basis of society is man, who is a free force.[103] Since man is free, he is able to choose. Since he is able to choose, he may make mistakes. Since he is able to make mistakes, he may suffer.

I will go further. He has to make mistakes and suffer, for his starting point is ignorance, and in the face of ignorance an infinite number of unknown paths open up, all of which lead to error except for one. 

Now, all error generates suffering. This suffering either falls on him who is mistaken, and in this case it is a question of (taking) responsibility (for it). Or it afflicts innocent beings with the error, and in this case it incites the marvellous and responsive apparatus known as solidarity.[104] 

The action of these laws, combined with the gift we have been given to associate effects with causes ought to bring us back, through suffering itself, to the path of good and truth. 

Thus, not only do we not deny (the existence of) harm, but we also acknowledge that it has a mission both in the social order as well as the physical. 

However, in order for it to accomplish this mission, solidarity must not be extended artificially so that responsibility is destroyed; in other words, freedom has to be respected. 

If human institutions run contrary to divine laws in this regard, harm does not follow error any the less, but it is displaced.[105] It (harm) strikes where it ought not to strike; it now acts without warning; it does not provide any lesson; it no longer tends to limit itself and to destroy itself through its own action. It persists, it becomes worse, just as would happen in a physical sense if the sorry effects of the reckless actions and excesses committed by people in one hemisphere were felt only by those in the opposite hemisphere. 

Well, this is precisely the tendency not only of the majority of our governmental institutions but also and above all of those we seek to impose as remedies for the harms that afflict us. On the philanthropic pretext of inculcating an artificial form of solidarity between men, responsibility is made increasingly inert and ineffective. Through the excessive intervention by the coercive power of the state, the relationship between work and reward is changed, the laws governing industry and exchange are disrupted, the natural development of education is attacked, capital and labor are led astray, ideas are perverted, absurd claims are inflamed, illusory hopes shine in men’s eyes, and an unheard of loss of human powers is caused. Centers of population are displaced, experience itself is made ineffective, in short, all all interests are given artificial foundations and set to fighting each other, and then people cry: “You see, interests are in conflict. It is freedom that is the root of all evil. Let us curse and stifle freedom.” 

And meanwhile since this sacred word still has the power of making hearts beat faster, freedom is stripped of its prestige by the forcible loss of its name, and it is under the name of competition[106] that the sorry victim is led to the (sacrificial) altar to the applause of the crowd holding out its arms to (receive) the bonds of servitude.

It was thus not enough to set out in their majestic harmony the natural laws of the social order; it was also necessary to point out the disturbing factors[107] that paralyze their action. This is what I have endeavored to do in the second part of this book.[108] 

I have striven to avoid controversy.[109] No doubt this made me miss the opportunity of providing the stability that comes from giving a more detailed discussion of the principles I wanted to promote. But would not the drawing of attention to digressions distract attention from the whole? If I reveal the structure as it is, what does it matter how others have seen it, even to those who (originally) taught me to see it?[110]

And now I appeal with confidence to men of all schools of thought who place justice, the general good, and truth above their (own) theories. 

Economists, like you I am in favor of Freedom; and if I have shaken a few of those premises that sadden your generous hearts, perhaps you will see in this work one more reason to love and serve our holy cause.

Socialists, you have placed your faith in Association.[111] I plead with you to say, once you have read this work, whether current society as it already is, minus its abuses and hindrances, that is to say, in a climate of freedom, is not the finest, the most complete and long-lasting, the most universal and equitable of all associations.[112] 

Egalitarians, you only accept one principle, the mutual exchange of services.[113] Let human transactions be freely made, and I will say that they are not and never can be anything other than a reciprocal exchange of services that constantly decrease in value[114] and constantly increase in utility.[115]

Communists, you want men, once they have become brothers, to enjoy in common the benefits that Providence has bestowed upon them. I intend to show that society as it already is has merely to make freedom a reality in order to achieve and exceed your wishes and hopes, for it makes everything available to all its members,[116] on the sole condition that each person takes the trouble to accept the gifts of God, which is an easy enough thing, or to freely recompense those who undertake this trouble on his behalf, which is only just. 

Christians of all denominations, unless you are the only ones who cast doubt on Divine wisdom, revealed in the most magnificent of His works which have been given to us, you will not find in this essay a single line that is in conflict with the most strict of your moral codes or your most mysterious dogmas.[117]

Property-owners, whatever the size of your possessions, if I show that your rights, now being contested, are limited, like those of the simplest manual worker, to receiving services in exchange for real services which have been actually provided by you or your forebears, this right will henceforward be founded on an unshakeable base.[118]

Proletarians, I have made a great effort to demonstrate that you obtain the fruits of the fields you do not own with less effort and trouble than if you were obliged to grow them through your (own) direct labor or if you had been given the land in its original state, before labor was expended getting it prepared for production.[119]

Capitalists and workers, I believe that I am in a position to establish the following law: “As capital is accumulated, the absolute share of capital to total production increases and its proportional share decreases; labor sees its relative share increase and, even more strongly, its absolute share. The contrary effect occurs when capital shrinks.”[120] When this law is established, its clear result is (that there is) (a) harmony of interests between laborers and those who employ them.[121]

<img src="/thumbs/d4-4t-0-0;d3-4t/25188-image002.jpg">

Disciples of Malthus, sincere and much disparaged philanthropists, whose only error has been to warn the human race against a law which you (genuinely) believed to be fatal, I will have to give you a more comforting law: “All other things being equal,[122] the increasing density of the population represents an increasing ability to produce.” And if this is so, it will certainly not be you who will be sorry to see the crown of thorns fall from the brow of our beloved economic science.[123]

Men who live by plunder,[124] you who by (means) of force or fraud, either by scorning the law or by making use of it, are growing fat on the food of the people; you who make a living from the errors you spread, the ignorance you foster, the wars you start, or the obstacles you put in the way of transactions; you who impose taxes on labor after making it unproductive and making it lose more “sheafs of wheat” than you (are able) to extort from them in “ears of wheat;”[125] you who see to it that you are paid for creating obstacles (in the first place) so that later you can be paid for removing some of them; you who are the living examples of egoism in its worst sense, parasitic growths (which live off) distorted policies,[126] get your corrosive ink ready for the criticism (of me you will inevitably write); to you alone will I not appeal, for the aim of this book is to get rid of you, or rather your unjust claims. It is no use being in favor of conciliation; there are two principles that can never be reconciled: freedom and coercion.

If the laws of Providence are harmonious, it is (only) when they act freely, otherwise they would not be harmonious in themselves. Therefore, when we note a lack of harmony in the world it can only be the result of a lack of freedom or an absence of justice. Oppressors, plunderers, those who hold justice in contempt, you can never be part of universal harmony since you are the people who are upsetting it. 

Is this to say that the effect of this book might be to weaken the government, to undermine its stability, or reduce its authority? The goal in my sight is quite the contrary. But let us understand each other fully. 

Political science consists in perceiving what ought to be and what ought not to be included in the powers of the state,[127] and setting out on this major journey, you should not lose sight of the fact that the state always acts by means of the use of force. It imposes on us at the same time both the services it provides and the services it makes us pay in return in the form of taxes.[128]

The question can be summed up thus: What things have men the right to impose on one another by force? Well, I know of just one that comes into this category, and that is justice. I have no right to force anyone to be religious, charitable, educated, or hardworking, but I do have the right to force him to be just. This is the case of legitimate self-defense.[129] 

Well, in a group of individuals, no right can exist that does not previously exist in those individuals themselves. If, therefore, the use of individual force is justified only by legitimate self-defense, you have only to acknowledge that government action always manifests itself through the use of force to conclude that it is essentially limited to ensuring order, security, and justice. 

Any government action outside this limit is an infringement of (the individual’s) conscience, mind, and labor, in a word, human freedom. 

This having been said, we must unceasingly and ruthlessly devote ourselves to the task of separating the entire domain of private activity[130] from encroachment by (government) power. This is the only condition under which we will (succeed in) winning our freedom or the free play of the harmonious laws that God has put into place for the development and progress of the human race. 

Will the government be weakened by this? Will it lose stability because it has lost some of its scope? Will it have less authority because it has fewer functions? Will it be less respected because there are fewer complaints made against it? Will it be more of a plaything of factions[131] when these huge budgets and this much coveted (sought after) influence, (both) of which are the bait (which attracts) factions, have been reduced? Will it face greater danger when it has fewer responsibilities? 

On the contrary, it appears obvious to me that to restrict the coercive power of the state to its sole but essential function, one that is widely agreed upon, benevolent, desired, and accepted by all, is to give it both universal respect and co-operation. If this happened, I do not see how there could be systematic opposition, parliamentary conflict, riots in the streets, revolutions, crises, factions, political delusions, ubiquitous claims to govern in a myriad of ways, theories that are as dangerous as they are absurd, teaching the masses to expect everything from the government,[132] this (practice of) diplomacy by compromise, these wars which are always on the horizon, or this armed peace which is almost as disastrous, these crushing taxes, (which are) impossible to allocate equitably, this dedicated and unnatural interference of policy in everything, those huge and artificial displacements of capital and labor, giving rise to unnecessary friction, fluctuation, crises, and other damage. All these and a thousand or more causes of unrest, irritation, disaffection, envy, and disorder, would no longer have any reason to exist, and the holders of power, instead of undermining it, would contribute to achieving universal harmony. This harmony does not exclude harm but allows it the increasingly limited place taken by ignorance and the perversity of our weak nature, which its mission is to counter and punish. 

Young people, in this era in which a regrettable skepticism appears to be the effect and punishment of the anarchy of ideas, I would consider myself lucky if (in) reading this book, it brings to your attention a certain set of ideas, and to your lips the words that are so reassuring, so sweetly scented, words that are not only a refuge but also a force, since it can be said of them that they move mountains; the words that opens the creed of Christianity, namely, I believe.[133]

“I believe, not with a faith that is submissive and blind, for it is not a question of the mysterious domain of revelation, but with a faith that is scientific and reasoned, suited to those things (best) left to the investigations of men. I believe that He who has arranged the physical world did not want to stand aside from arranging the social world. I believe that He has known how to make freely acting individuals as well as inert molecules work together and move in harmony. I believe that His providence shines forth at least as much, if not more, in the laws to which He has subjected our interests and wills as in those that He has imposed on (the) weight and speed (of matter). I believe that everything in society is a cause for the advancement and progress, even the things that damage it. I believe that evil leads to good and triggers it, whereas good can never lead to evil, from which it follows that good has to triumph in the end. I believe that the irresistible tendency of society is a steady approach by men to a common physical, intellectual and moral level, at the same time as this level is gradually and indefinitely (being) raised.[134] I believe that all that is needed for the gradual and peaceful development of the human race is for these tendencies not to be disrupted and for them to regain freedom of movement. I believe all these things, not because I want them and they satisfy my feelings, but because after much reflection my mind gives them its consent.”

Ah! If ever you pronounced the words: I believe, you would be enthusiastic in (wanting to) spread them and the social problem would quickly be solved for, in spite of what people say, it is easy to solve. Interests are in harmony and therefore the solution is wholly to be found in this one word: freedom.

 


 

I. Natural and Artificial Organisation[135]

Are we really certain that the social mechanism,[136] like the celestial mechanism, and like the mechanism of the human body, obeys universal laws? Are we really certain that it is a harmoniously organized whole? Above all, is it not the absence of any organization that leaps to the eye? Is it not precisely organization that all good-hearted men with an eye to the future, all progressive writers, and all the pioneers of thought are seeking? Are we not a mere juxtaposition of individuals who have no ties to each other, who live without (any) harmony, and are given to an anarchical freedom? Now that they have painfully recovered all their liberties one by one, do not our numberless masses wait for some great genius to coordinate them into a harmonious whole? After engaging in destruction, do we not have to lay (some new) foundations?[137]

If these questions had no other bearing than to ask whether society can do without written laws, rules, and repressive measures, whether each man can make unlimited use of his faculties even though he might infringe the liberties of others or cause damage to the community as a whole, whether, in a word, we should not see in the maxim “Laissez faire, laissez passer[138] the absolute principle of political economy? If, I say, that were the question, nobody would be in any doubt as to the answer. Economists do not state that a man may kill, pillage, or commit arson and that society has no choice save to let it happen;[139] they say that social resistance to such acts would occur as a matter of course, even in the absence of any legal code, and that, in consequence, this resistance constitutes a general law of humankind. They say that civil or penal laws should regularize and not counter the action of these general laws that they presuppose. There is a gulf between a social organization based on the general laws of humanity and an artificial, abstract, and contrived organization, which takes no account of these laws, denies them or despises them, one in short that several modern schools of thought appear to wish to impose (on us).[140]

For, if there are general laws that act independently of the written laws whose action such written laws have only to confirm, these general laws must be examined; they may be the worthy subject-matter of a science, and political economy (already) exists to do this. If, on the contrary, society is a human invention, if men are no more than inert matter into which a great genius, in the words of Rousseau, has to infuse sentiment and willpower, movement and life,[141] then there is no such thing as political economy, only an indefinite number of possible and contingent arrangements, and the fate of nations depends on the founder to whom chance has entrusted their destinies.

To prove that society is subject to general laws, I will not indulge in a long dissertation. I will limit myself to pointing out a few facts, which although somewhat commonplace, are nonetheless important.

Rousseau has said: “A great deal of philosophy is needed for us to take account of those facts that are too close to us.”[142]

Such are the social phenomena in the midst of which we live and move. Habit has familiarized us with these phenomena to such an extent that we no longer pay attention to them, so to speak, unless something sudden and abnormal brings them to our notice.

Let us take a man who belongs to a modest class in society, a village carpenter,[143] for example, and let us observe all the services he provides to society and all those he receives from it; it will not take us long to be struck by the enormous apparent disproportion.

This man spends his day sanding planks and making tables and wardrobes; he complains about his situation and yet what does he receive from this same society in return for his work?

First of all, each day when he gets up he dresses, and he has not personally made any of the many items of his outfit. However, for these garments, however simple, to be at his disposal, an enormous amount of work, industry, transport, and ingenious invention needs to have been accomplished. Americans need to have produced cotton, Indians indigo, Frenchmen wool and linen, and Brazilians leather. All these materials need to have been transported to a variety of towns, worked, spun, woven, dyed, etc.

He then has breakfast. In order for the bread he eats to arrive each morning, land had to be cleared, fenced, ploughed, fertilized, and sown. Harvests had to be stored and protected from pillage. A degree of security had to reign over an immense multitude of people. Wheat had to be harvested, ground, kneaded, and prepared. Iron, steel, wood, and stone had to be changed by human labor into tools. Some men had to make use of the strength of animals, others the weight of a waterfall, etc.; all things each of which, taken singly, implies an incalculable mass of labor put to work , not only in space but also in time.

This man will not spend his day without using a little sugar, a little oil, or a few utensils.

He will send his son to school to receive instruction, which although limited, nonetheless implies research, previous studies, and knowledge which would startle the imagination.

He goes out and finds a road that is paved and lit.

His ownership of a piece of property is contested; he will find lawyers to defend his rights, judges to maintain them, officers of the court to carry out the judgment, all of which once again imply acquired knowledge, and consequently understanding and a certain standard of living.[144]

He goes to church; it is a prodigious monument and the book he carries is a monument to human intelligence perhaps more prodigious still. He is taught morality, his mind is enlightened, his soul elevated, and in order for all this to happen, another man had to be able to go to libraries and seminaries and draw on all the sources of the human tradition; he had to have been able to live without taking direct care of his bodily needs.

If our craftsman sets out on a journey, he finds that, to save him time and reduce the trouble he has to take, other men have flattened and leveled the ground, filled in the valleys, lowered the mountains, spanned the rivers, increased the smooth passage on the route, set wheeled vehicles on paving stones or iron rails, and mastered the use of horses, steam, etc.

It is impossible not to be struck by the truly immeasurable disproportion that exists between the satisfactions drawn by this man (living) in (a) society and those he would be able to provide for himself if he were to be limited to his own resources. I am bold enough to say that in a single day, he consumes things he would not be able to produce by himself in ten centuries.

What makes the phenomenon stranger still is that all other men are in the same situation as he. Each one of those who make up society has absorbed a million times more than he would have been able to produce; nevertheless they have not robbed each other of anything. And if we examine things more closely, we see that this carpenter has paid in services for all the services he has been rendered. If he kept his accounts with rigorous accuracy we would be convinced that he has received nothing that he has not paid for by means of his modest industry, and that whoever has been employed in his service, either at any time or in a given period, has received or will receive his (own) remuneration.

For this reason, the social mechanism needs to be either very ingenious or very powerful since it leads to this strange result, that each man, even he whom fate has placed in the humblest of conditions, receives more satisfaction in a single day than he could produce in several centuries.

That is not all, and this social mechanism will appear still more ingenious, if the reader would just consider his own case.

Let me assume that he is a simple student.[145] What is he doing in Paris? How is he living there? It cannot be denied that society places at his disposal food, clothes, a lodging, entertainment, books, the means of instruction, in short a multitude of things, the production of which would take a considerable amount of time just to explain and even more to be carried out. And in return for all these things, which have required so much work, sweat, fatigue, physical or intellectual effort, such feats of transportation, so many inventions and (economic) transactions, what services does this student render to society? None. He is only preparing himself to render services to it. For what reason, therefore, have these millions of men, who have devoted themselves to positive, actual, and productive work, handed over to him the fruit of their labor? Here is the explanation; the father of this student, who was a lawyer, doctor, or merchant[146] had previously rendered services to a society (perhaps in China),[147] and had received from it, not immediate services but rights to (future) services, which he might reclaim at the time, in the place, and in the form of his choosing. It is for these far-off and past services that society is settling its debts today and, what is astonishing, if we think through the progress of the infinite number of transactions which have had to take place to achieve the result, we would see that each person has been paid for his trouble, that these rights have passed from hand to hand, sometimes being split (up) and at other times being combined together until, through the consumption of this student, the balance has been struck. Is this not a very strange phenomenon?

We would be shutting our eyes to the light if we refused to acknowledge that society cannot present such complicated combinations, in which civil and penal laws play so little a part, without obeying a prodigiously ingenious mechanism. This mechanism is the subject of study of political economy.

One more thing worthy of comment is that, in this truly incalculable number of transactions which have contributed to keeping alive one student for one day, there is perhaps not a millionth part which has been made directly. The countless things he has enjoyed today are the work of men a great number of whom have long since disappeared from the face of the earth. Nevertheless they were paid as they wished, although he who is benefiting today from the product of their work has done nothing for them. He did not know them and will never know them. He who reads this page, at the very moment at which he reads it, has the power, although he perhaps does not realize this, to set in motion men in all countries, of all races, and I might almost say, of all periods of time; white men, black men, red men, and yellow men. He causes generations that have died away and generations not yet born to contribute to his current satisfactions, and he owes this extraordinary power to the services his father rendered in the past to other men who on the face of it have nothing in common with those whose labor is being set in motion today. However, the balance is such that in time and space, each one is reimbursed and has received what he calculated he should receive.

In truth, can all this have been possible, can such extraordinary phenomena have been achieved without there having been in society a natural and wise organization[148] which acts, so to speak, without our knowledge?

There is much talk these days of of inventing a new way of organizing society. Is it really certain that any thinker, however much genius he is supposed to have or however much authority he is given, is capable of imagining and imposing (on society) an organization that is superior to the one a few of whose achievements I have just outlined?

What would happen if I also described its cogs and wheels, its springs, and its movements?

Its wheels are men, that is to say, beings capable of learning, reflecting, reasoning, making mistakes, rectifying them, and consequently acting[149] to improve or worsen the (operation) of the mechanism itself. They are capable of feeling satisfaction and pain, and this makes them not only cogs and wheels but also the springs of the mechanism. They are also its driving force because the principle of action resides in them.[150] They are still more than that, they are the object of the mechanism itself, and its purpose, since it is in individual satisfactions and pain that everything is finally resolved.

However, we have noted, and unfortunately it is not difficult to notice, that in the action, the development, and even the progress (by those who admit it) of this powerful mechanism, many of the wheels are inevitably and fatally broken and that, for a large number of human beings, the sum of unmerited pain,[151] exceeds by far the sum of enjoyment.

Observing this, many sincere souls, many generous hearts have doubted the mechanism itself. They have denied it, they have refused to study it, they have attacked, often violently, those who have researched and set out its laws. They have pitted themselves against the nature of things and finally they have suggested that society be organized according to a new design, in which injustice, suffering, and error would find no place.

God forbid that I should stand against intentions that are so manifestly philanthropic and pure! But I would be abandoning my convictions, I would be giving ground in the face of the injunctions of my own conscience if I did not say that, in my view, these men are on the wrong road.

In the first place, they are reduced, by the very nature of their arguments, to the sad necessity of failing to recognize the good developed by society, of denying its progress, and attributing all harm and suffering to it, seeking these out almost avidly and exaggerating them excessively.

When people think they have discovered a social organization different from that which is the result of natural human tendencies, in order for their invention to be accepted they clearly need to describe in the blackest possible colors the results of the organization they wish to abolish. For this reason, after having enthusiastically proclaimed and possibly exaggerated[152] human perfectibility, the political writers to whom I refer fall into the strange contradiction of saying that society is increasingly deteriorating. According to them, men are a thousand times more unhappy than they were in ancient times, under the feudal régime, and under the yoke of slavery,[153] and the world has become a (living) hell. If it were possible to conjure up Paris as it was in the tenth century, I dare say that such a thesis would be untenable.

Next, they are led to condemn the very principle governing men’s action, I mean self-interest, since it has led to such a state of affairs. We should note that man is organized in such a way that he seeks satisfaction and avoids pain; I agree that this is the cause of all social harms – war, slavery, plunder, monopoly, and privilege - but it is also from this that all good arises, since the satisfaction of needs and aversion to pain are the driving forces for men. The question is therefore to ascertain whether this driving force, which in origin is individual but becomes social, is not itself a principle of progress.

In any case, do not the inventors of new organizations realize that this principle, which is inherent in the very nature of man, will accompany them in their organizations causing many more forms of devastation there than in our natural organization, in which the unjust claims and interests of one person will at least be contained by the resistance of all?[154] These political writers always assume two inadmissible things, firstly, that society as they perceive it will be governed by infallible men totally lacking in this driving force (of self-interest), secondly that the masses will allow themselves to be governed by such men.

Lastly, the Organizers do not appear to take the slightest interest in the means of implementation. How are they going to ensure that their systems gain acceptance? How will they convince everyone at the same time to abandon the force that drives them, namely the attraction of pleasure and the aversion to pain. Will we as Rousseau said, have to change the moral and physical constitution of man?

It seems to me that there are only two ways to persuade everyone at the same time to cast aside, like an unwanted garment, the existing social order, under which humanity has lived and developed from its origin to the present day, and then (proceed to) adopt an organization of human invention and become the obedient parts of another mechanism: force or universal consent.

It is necessary, either for the Organizer to have at his disposal a force capable of overcoming all forms of resistance so that humanity becomes malleable wax in his hands, to be kneaded and molded to suit his fantasy, or to obtain through persuasion agreement so total, so exclusive, and even so blind that it renders the use of force superfluous.

I challenge anyone to quote me a third means of achieving the triumph of a phalanstery[155] or any other form of artificial social organization and having it become common human practice.

However, if there are just these two means and if we prove that the one is as impracticable as the other, this would be an intrinsic proof that the organizers are wasting both their time and their trouble.

As for having at their disposal a physical force sufficient to ensure the submission of all the kings and nations on earth, this is something that dreamers, even though they are dreamers, have never contemplated. King Alphonse was proud enough to say: “If I had been privy to the counsels of God, the world on this planet would have been better organized."[156] But if he ranked his own wisdom above that of the Creator, at least he was not fool enough to wish to enter a power struggle with God and history does not relate that he attempted to adjust the movement of the stars to suit laws of his own invention. Descartes also contented himself with creating a small world (made up) of dice and strings in the full knowledge that he was not powerful enough to move the universe.[157] The only one we know of who claimed this was Xerxes who, intoxicated by his power, dared to say to the waves: “You will go no further."[158] However, the waves did not retreat before Xerxes, Xerxes retreated before the waves and, had it not been for this humiliating but wise precaution, he would have been swallowed up.

The Organizers thus lack the force to submit humanity to their experiments. Should they win over to their cause the Russian Autocrat, the Shah of Persia, the Khan of the Tartars, and all the heads of nations who exercise an absolute empire over their subjects, they would still not have at their disposal a force sufficient to divide men into groups and series[159] and abolish the general laws of property, exchange, inheritance, and family, since, even in Russia, Persia or Tartary, account still has to be taken to a greater or lesser degree of the men concerned. If the Emperor of Russia took it into his head to wish to modify the moral and physical constitution of his subjects, he would probably be promptly ousted and his successor would not be tempted to continue the experiment.

Since force is a means quite out of reach of our many Organizers, they have no other recourse than to obtain universal consent.

There are two ways of obtaining this: persuasion and deception.[160]

Persuasion! But we have never seen two minds in perfect agreement on every point of a single discipline. How then will all men, with different languages, of different races and customs, and spread all around the world, of whom the majority are unable to read and who are destined to die without ever even hearing the name of the reformer (or their society) spoken, unanimously accept (this new) universal science? What does it involve? Changing the way people work and trade, changing their domestic, civil, and religious relationships, in other words, altering the physical and moral constitution of human beings: and they (the Organisers) hope to unite the entire human race by (changing their) beliefs!

Truly, the task appears an arduous one.

If a man comes to tell his fellow-men:

“For the last five thousand years there has been a misunderstanding between God and the human race.

From Adam to the present day, the human race has been on the wrong path and, if only it will believe me, I am going to set it on the right road.

God wanted the human race to proceed differently; it did not want to do this, and this is why evil came into the world. Let all mankind listen to me and retrace its steps and proceed in a different direction, and universal happiness will shine on it.”

If, as I say, he starts in this way, then if he is believed by five or six followers that is a great deal. From this to being believed by a billion men is an incalculable step, one that is so far off that the distance is immeasurable.

And then, consider that the number of social inventions is as unlimited as the field of imagination; that there is not one political writer who, after closeting himself in his study for a few hours, cannot come out with a plan for an artificial form of organization in his hand; that the inventions of Fourier, Saint-Simon, Owen, Cabet, Blanc, etc.[161] bear not the slightest resemblance to one another; that there is never a day that does not see yet others hatched; that truly the human race has good reason to reflect and hesitate before rejecting the social organization that God has given it in order to make a final and irrevocable choice from so many different social inventions. For what would happen if, once it had chosen one of these plans, a better one came along? Can the human race establish property, family, work, and trade on a different basis every day? Ought it to lay itself open to changing its organization every morning?

“Therefore," as Rousseau said, “as the legislator cannot use either force or reason, he has to resort to an authority of a different order, one that can lead people along without violence and persuade them without convincing them.”[162]

What is this authority? (It is) deception. Rousseau does not dare to utter the word, but, according to his invariable custom in such cases, he shrouds it in the transparent veil of an eloquent tirade:

“Here," he says, “is what forced the Fathers of nations down through time to have recourse to the intervention of heaven and to honor the gods with their own wisdom so that nations, subjected to the laws of the State as well as to those of nature and acknowledging the same power in the forming of man as in the forming of cities, obeyed freely and bore obediently the yoke of public happiness. This sublime reason, which raises them above the reach of common man, is the one by which legislators put decisions into the mouths of the immortals in order to lead by divine authority those whom human prudence could not move. But it is not in the power of every man to make the gods speak, etc.”[163]

And so that nobody might misunderstand him, he leaves to Machiavelli, by quoting him, the job of concluding his idea. “Mai non fu alcuno ordinatore de leggi STRAORDINARE in un populo che non ricorresse a Dio.”[164]

Why does Machiavelli advise us to have recourse to God and Rousseau to the gods or the immortals? I leave the reader to provide the answer.

I certainly do not accuse the modern fathers of nations of resorting to these unworthy tricks. Nevertheless, the fact should not be hidden that, when you put yourself in their place, it is easy to be carried away by the desire to succeed. When someone who is sincere and philanthropic is firmly convinced that he holds a social secret which will enable his fellow-men to enjoy boundless happiness in this world, when he sees clearly that his idea cannot prevail either by force or reason and that trickery is his sole resource, he must be sorely tempted. It is well known that even ministers of a religion which professes the greatest horror of lies, have not hesitated to indulge in pious fraud,[165] and the example of Rousseau, an austere writer who inscribed at the head of all his writings the motto: Vitam impendere vero,[166] shows us that even proud philosophy itself can be seduced by the charm of this other, quite different maxim: The end justifies the means. Why should it be surprising that modern Organizers also think of honoring the gods with their own wisdom, putting their decisions into the mouths of the immortals, lead people without (using) violence, and persuade them without convincing them?

We know that following the example of Moses, Fourier put a Genesis before his Deuteronomy.[167] Saint-Simon and his disciples have gone much further in their apostolic tendencies.[168] Other, more prudent writers invoke religion in its widest terms, modifying it to suit their views under the banner of neo-Christianity,[169] and nobody will fail to be struck by the tone of mystic affectation that cloaks the preaching of almost all the modern Reformers.[170]

But the efforts made in this direction serve only to prove one thing, of some importance it is true, which is that these days, not everyone who wants to can succeed in being a prophet. People can proclaim themselves to be God as much as they like; nobody believes them, whether it be the public, their colleagues, or themselves.

Since I have mentioned Rousseau, I will allow myself a few comments on this Organizer, especially since they will aid an understanding as to how artificial organizations differ from a natural organization. This digression, incidentally, is not totally inopportune, since for some time the Social Contract has been hailed as the oracle of the future.[171]

Rousseau was convinced that in the state of nature man lived in isolation and that consequently society was a human invention. “Social order," he said at the beginning, “does not come from nature; it is therefore based on convention.”[172]

What is more, although he had a passionate love for freedom, this philosopher had a very low opinion of men. He believed them to be wholly incapable of creating good institutions for themselves. The intervention of a founder, a legislator, a father of the nation was therefore essential.

“A nation subject to laws," he said, “must be their author. It is up to those who band together and them alone, to regulate the conditions governing society, but how will they do this? Will it be by common accord, by sudden inspiration? How can a blind multitude that often does not know what it wants, since it rarely knows what is good for it, set up on its own such a great and difficult enterprise as a legislative system? … Individuals see the good that they are rejecting, the general public wants the good that it does not see, and all have an equal need of guides. … This is what gives rise to the need for a legislator.” [173]

As we have already seen, as this legislator “cannot use either force or reason, he has of necessity to resort to authority of another order,” that is to say in plain language, deception.[174]

Nothing can give an idea of the immense distance above other men at which Rousseau places his legislator:

“Gods are needed to give laws to men. … He who dares to undertake to provide institutions for a nation has to feel himself capable of changing human nature itself, so to speak …, of altering man’s constitution in order to strengthen him. He needs to remove man’s own forces in order to give him others that are not natural to him …The legislator is, in all respects, an outstanding man in the State, … his task is a special and superior function which has nothing in common with human dominion …. While it is true that a prince is a rare being, how much truer is this of a great legislator? The first merely has to follow the model that the other has to offer him. The legislator is the engineer, who invents the machine while the prince is merely the laborer who assembles it and makes it work.”[175]

And where is the place of the human race in all this? It is the raw material out of which the machine is constructed.

Truly, is this not pride raised to the level of madness? So, men are the parts of a machine that the prince operates, and the design of which the legislator has suggested. The philosopher controls the legislator by placing himself at an unmeasurably great distance above the common people, the prince, and the legislator himself, [176](where) he floats above the human race, moves it, transforms it, kneads it, or rather teaches the Fathers of Nations how to go about doing this.

Nevertheless the founder of a nation has to set himself a goal. He has human material to set to work, and he has to organize it with an aim in mind. Since men have no initiative and everything depends on the legislator, he will decide whether a nation ought to engage in trading or farming, or live primitively and eat fish etc., but it has to be hoped that the legislator will not make a mistake and not do too much violence to the nature of things.

When men agree to associate together, or rather when they associate together through the will of the legislator, they therefore have a very specific goal. “Thus it was,” says Rousseau, “that the Hebrews and recently the Arabs have had religion as their main aim, the Athenians, letters, Carthage and Tyre, trade, Rhodes, the navy, Sparta, war and Rome, virtue.”[177]

What will the goal be that persuades us, the French people, to break out of isolation or the state of nature in order to form a society? Or rather, (for we are not just inert matter, the material that makes up the machine), toward what objective will we be directed by our great Teacher?

Given Rousseau’s ideas, this can scarcely be literature, trade, or the navy. War is a nobler goal and virtue a nobler one still. However, there is one that is far greater than these. What ought to be the aim of any legislative system, “is freedom and equality.”[178]

But you have to know what Rousseau meant by freedom. Enjoying freedom, in his view, is not to be free, it is to vote for something, even when you are being led without violence and persuaded without being convinced, because then you obey with liberty and (can) easily carry the yoke of public happiness.[179]

“In Greece," he says, “all that the people had to do they did themselves. They were constantly being assembled in the public square, they lived in a temperate climate, they were not greedy, the slaves did all the work, and the main preoccupation of the people was their freedom.[180]

Elsewhere he says, “The English think that they are free, but they are greatly mistaken. It is only during the election of members of parliament that they are free; as soon as the members are elected, the people are slaves, they are nothing.”[181]

Therefore the people have to provide everything that is a public service themselves if they wish to be free, for this is what constitutes freedom. They have to always be having elections and be forever on the public square. Woe betide those who think of working for a living! As soon as a single citizen takes it into his head to look after his own affairs, instantly (this is an expression that Rousseau loves) all will be lost.

Certainly the problem is not a small one. What ought we to do? For in the end, even in order to practice virtue and exercise freedom we have to live.

We have just seen in what oratorical guise Rousseau hid the word deception. We will now see the type of eloquence to which he resorts to put across the conclusion of the entire book, namely, slavery.

“Your harsh climates impose needs on you. For six months of the year, the public square is not usable, your dull tongues cannot make themselves heard in the open air, and you fear slavery less than poverty.”

You see clearly that you cannot be free.

“What! Is freedom kept in place only with the support of servitude? Perhaps.”[182]

If Rousseau had stopped at this dreadful word, the reader would have been outraged. He had to resort to impressive declamations. Rousseau does not fail to do so.

“All that is not in nature (he is speaking about society) has disadvantages, and a civil society has more than all the others. There are unfortunate positions in which personal freedom can only be preserved at the expense of that of others and in which citizens can be perfectly free only where slaves are very much enslaved. You modern peoples have no slaves but you are yourselves slaves; you are paying for their freedom with yours… It is useless for you to boast of this preference; I find in it more cowardice than humanity.”[183]

I ask you, does this not mean: “Modern peoples you would do better not to be slaves but to have slaves”?

I hope the reader will pardon this long digression, but I felt it to be germane. For some time, Rousseau and his disciples in the Convention[184] have been held up to us as apostles of human fraternity. Men as (raw) materials, a prince as (a) engineer, a father of the nation as an inventor, and a philosopher crowning all of this; with deception as the means, and slavery as the result. Is this then the fraternity we are being promised?

I also consider that this study of the Social Contract was useful in helping to point out the things that characterize artificial social organizations. Start with the idea that society is an unnatural condition; look for the schemes to which the human race might be subjected; ignore the fact that it (society) has with(in) itself its own driving force, think of men as raw material; aim to infuse them with movement and willpower, emotions and life; position yourself thus at an incommensurable distance above the human race, these are the characteristics common to all the inventors of social organizations. The inventions differ, but the inventors are (all) alike.

Among the new schemes urged upon weak mortals, there is one presented in terms that warrant attention. Its formula is: A progressive and voluntary association.

However, political economy is founded precisely on this assumption, that society is nothing other than an association (as these words state),[185] an association initially full of faults because man is imperfect, but which improves as he does, that is to say progressively. Do we want to talk about a closer association between labor, capital, and talent, which ought to provide the members of the human family with more goods and greater well-being that is better distributed? If these associations are voluntary, if force and coercion are absent, and if those in the association do not demand that the cost of setting up these associations be borne by those who refuse to join, how do these (associations) go against the principles of political economy? Isn’t political economy required, as a science, to study the various ways in which men see fit to join (their) forces and divide (up) their occupations among themselves in order to increase (their) well-being and share it better? Doesn’t commerce frequently give us the example of two, three, or four people forming associations among themselves? Isn’t sharecropping a type of association,[186] informal if you like, of capital and labour? Have we not lately seen shareholding/stock companies arising that give the smallest amount of capital the opportunity of taking part in much greater enterprises? Are there not, somewhere in this country, a few factories where the attempt is made to establish profit-sharing associations for all their workers.[187] Does political economy condemn these attempts and the efforts made by men to gain greater advantage from their strengths? Has it (political economy) stated somewhere that the human race has said its last word? Quite the contrary, and I consider that no science demonstrates more clearly that society is (still) in its infancy.

But whatever hopes one conceives for the future, whatever ideas one has of the forms that man might find to improve human relationships and disseminate well-being, knowledge, and moral order, one must nevertheless recognize that society is an organization whose components are intelligent and moral actors[188] endowed with free will, and are capable of being perfectible.[189] If you take freedom away from this actor, he becomes merely a sad and sorry mechanism.

Freedom! People appear not to want it right now. In the land of France, that privileged empire of fashion, it seems that freedom is no longer fashionable. For my part, I state that whoever rejects freedom has no faith in humanity. Some claim that they have made the discouraging discovery that freedom inevitably leads to monopoly.[190] No, this monstrous linking, this unnatural coupling does not hold; it is the imaginary fruit of an error soon dissipated by the light of political economy. Freedom giving rise to monopoly? Oppression arising naturally from freedom? We must be on our guard. To claim this is to claim that the tendencies of the human race are radically bad, bad in themselves, bad by nature, and bad in their essence. It is to claim that the natural inclination of man is toward his degeneration and the irresistible attraction of his mind toward error. However, in this case, what is the use of our schools, our studies, our research, our discussions save to give greater force to that fatal inclination, since for the human race to learn to choose would be to learn to commit suicide? And if the tendencies of the human race are essentially perverse, where will the Organizers look for their fulcrum in order to change them? According to the premises of the thesis, this fulcrum has to be situated outside the human race. Will they look for it within themselves, in their hearts and minds? But for a start they are not gods; they are men too and consequently impelled like the rest of the human race toward the fatal abyss. Will they call for intervention by the state? But the state is made up of men, and it would have to be proved that these men form a class apart, for whom the general laws governing society are not not applicable, since they are the ones who have been made responsible for making these laws.[191] Without this proof, the problem has not been solved.[192]

Let us not condemn the human race in this way before having examined its laws, forces, energies, and tendencies. From the time he recognized gravity, Newton no longer pronounced the name of God without taking his hat off. Just as much as “the mind is above matter,” the social world is above the (physical) one admired by Newton, for celestial mechanics obey laws of which it is not aware. How much more reason (then) would we have to bow down before eternal wisdom (and also universal thought) as we contemplate the social mechanism (and see there how) “the mind moves matter” (mens agitat molem).[193] Here is displayed the extraordinary phenomenon that each atom (in this social mechanism) is a living, thinking being, endowed with that marvelous energy, with that source of all morality, of all dignity, of all progress, an attribute which is exclusive to man, namely FREEDOM!

 


 

II. Needs, Efforts, and Satisfactions (of needs)[194]

What a profoundly dreadful spectacle France offers us![195]

It would be hard to say whether anarchy has moved from thoughts into deeds or from deeds into thoughts, but what is certain is that it has permeated everything.

The poor are rising up against the rich, the proletariat against property (owners), the people against the bourgeoisie, labor against capital, agriculture against industry, the country against the towns, the provinces against the capital, and the native born citizens against foreigners.

And along come the theorists to turn this conflict into a theory. “It is the inevitable result of the nature of things," they say, “that is to say, of freedom. Man is self-centered,[196] and this is the source of all evil, for because he is self-centered he tends to be concerned with his own well-being, and he can find this only in the misfortune of his fellows. Let us therefore prevent him from following his inclinations; let us stifle his freedom; let us change the human heart, and substitute a different driving force from the one that God has placed there. Let us invent and then manage an artificial form of society!”

At this point a boundless prospect opens up alike for logic or the imagination. If you are endowed with the mind of a dialectician and a morose nature, you will beaver away at the explication of evil. You can dissect it, put it in a crucible, have it spell out its definitive viewpoint, go back to its causes, and pursue its consequences. Then, since given our native imperfection it inheres in everything, there is nothing that cannot be denigrated. Property, the family, capital, industry, competition, freedom, and self-interest, will be shown from one angle only, the one that destroys or wounds; the natural history of mankind will, so to speak, be encapsulated clinically. God will be challenged to reconcile His alleged infinite bounty with the existence of evil. You sully everything, you are disgusted with everything and you deny everything, and yet you never achieve anything better than a sorry and precarious success with classes whose suffering inclines them all too readily to despair.

If, on the other hand, you bear a heart open to benevolence, and your mind revels in illusions, you rush head first in pursuit of chimeras. You dream of Oceania,[197] of Atlantis,[198] of Salente,[199] Spensonia,[200] Icaria,[201] Utopia,[202] and Phalansteries,[203] you people them with docile, loving and devoted beings who are careful never to put an obstacle in the path of dreamers’ fantasies. Dreamers settle themselves complacently into their role (as the agent) of Providence. They arrange, dispose, and mold men at will. Nothing stops them, and they never encounter disappointments. They are like the Roman preacher who, after abandoning his Rousseau-style views, vigorously refuted the Social Contract and triumphed at having reduced his opponent to silence. This is how our reformers dangle in front of those who are enduring suffering, seductive pictures of an ideal form of happiness perfectly fit for putting off the harsh necessities of real life.

However, it is rare for a utopian to limit himself to these innocent delusions. As soon as he wishes to embroil the human race in them he finds that the human race does not lend itself to easy transformation. It resists bitterly. To encourage it, he does not merely talk to humanity of the happiness it is turning down, he talks mainly of the evils from which he claims to be delivering it. There could be no such thing as too striking a picture. He falls into the habit of loading his palette and brightening up his colors. He seeks evil in the society of today with as much passion as as another might devote to discovering good in it. He sees only suffering, rags, exhaustion, starvation, pain, and oppression. He is astonished and upset because society is not sufficiently conscious of its poverty. He stops at nothing to strip society of its indifference and, after having begun with benevolence, he ends up with misanthropy as well.[204]

God forbid that I cast doubts on the sincerity of anyone. But truly, I cannot see how the political writers, who see a fundamental conflict at the foundation of the natural order of societies, can enjoy an instant of peace and calm. I consider that discouragement and despair must be their sorry lot. For in the end, if nature has made a mistake in making self-interest the mainspring of human society (and its error is manifest, as soon as it is accepted that interests are inevitably in conflict), how do these writers not see that evil is irreparable? As we can turn only to men, we who are men ourselves, where will we place our fulcrum for our lever to change the tendencies of the human race? Will we appeal to the police, the magistrates, the state, or the legislator? This, however, is to call upon men, that is to say, those who are subject to the common infirmities of man. Should we turn to universal suffrage? This would be to give the freest possible rein to universal tendencies.

These political writers therefore have just one resource. This is to pass themselves off as people with revealed knowledge and prophets kneaded from a different clay, who draw their inspiration from other sources than the rest of their fellow-men, and this is doubtless why we see them so often enveloping their theories and counsels in mystic phraseology. But if they are sent by God, let them provide proof of their mission. In the end, what they are asking for is sovereign power and the most absolute despotism that has ever existed. Not only do they want to govern our actions, they also aspire to change the very essence of our feelings. This is the least that their writings show us. Do they hope that the human race will take their word for it, above all when they cannot even reach agreement among themselves?

But before even examining their projects for artificial forms of society, is there not one thing that has to be ascertained, that is to say whether they are not mistaken right from the start? Is it absolutely certain that Interests are naturally in conflict, that an irremediable cause of inequality is bound to develop in the natural order of human society under the influence of self-interest and, this being so, that God has clearly made a mistake when He ordained that man could pursue his own well-being?[205]

This is what I propose to investigate.

Taking man as God was pleased to make him, with the propensity to look to the future and to gain experience, and being perfectible and self-loving, it is true, but with an affection which is tempered by the principle of kindness and in any case contained and balanced by encountering similar sentiments universally found in the environment in which it operates, I wonder what social order is bound to result from the combination and free play of these elements.

If we find that this result is none other than a gradual progress toward well-being, human improvement, and equality, a sustained approach of all classes toward the same physical, intellectual, and moral level, while at the same time this level is constantly rising,[206] the work of God will be justified. We will be pleased to learn that there is no gap in creation and that the social order, as all the others, proves the existence of these harmonious laws[207] before which Newton bowed and which drew from the Psalmist the cry: “Coeli enarrant gloriam Dei.[208]

Rousseau used to say: “If I were a prince or legislator, I would not waste time saying what ought to be done; I would do it or hold my tongue.”[209]

I am not a prince, but the trust of my fellow-citizens has made me a legislator.[210] Perhaps they will tell me that now is the time for me to act and not to write.

I hope they will forgive me! Whether it is truth itself that harries me or just that I am the victim of delusion, I still feel the need to concentrate on a range of ideas for which I have not been able to gain acceptance up to now because I have presented them in dribs and drabs.[211] I think that I discern sublime and reassuring harmonies in the play of natural laws governing society. Should I not try to show others what I see or think I see, in rallying a great many mistaken minds and embittered hearts around a way of thinking based upon concord and fraternity? If I appear to drift away from the post to which I have been called in order to gather my thoughts, at a time when the beloved ship of state is buffeted by storms, it is because my weak hands cannot help hold the tiller. Besides, am I betraying my mission when I reflect on the causes of the storm itself and endeavor to act on these causes? What is more, if I do not do this now, who knows whether I will have the opportunity to do it later?[212]

I will start by setting out a few economic notions. With the help of the work carried out by my predecessors, I will endeavor to epitomize this mode of explanation in one true, simple, and fruitful notion, one that it foresaw from the outset and to which it has constantly drawn near, with the time perhaps having come to establish its wording definitively. Then by this beacon, I will try to resolve some of the problems that still arouse controversy: competition, mechanization, foreign trade, luxury, capital, rent, etc. I will highlight[213] the relationships, or rather the harmonies, of political economy with the other moral and social sciences by casting a glance on the serious matters encapsulated in the following words: self-interest, property, community, liberty, equality, responsibility, solidarity, fraternity, and unity.[214] Finally, I will draw the reader’s attention to the artificial obstacles[215] that the peaceful, regular, and progressive development of human societies encounter. From these two concepts, harmonious natural laws and artificial disturbing factors, the resolution of the social problem will be deduced.[216]

It would be difficult to miss the double trap that lies in wait for this exercise. In the midst of the whirlwind sweeping us away, people will not read this book if it is too theoretical. If it succeeds in being read, it will be because the questions are merely touched upon. How do we reconcile the rights of science with the demands of readers?[217] In order to satisfy all the requirements of form and substance, each word will have to be weighed and its rightful place reflected upon. This is how crystal is formed drop by drop in silence and obscurity. Silence, obscurity, time, and freedom of thought, I have none of these; and I am reduced to relying upon the wisdom of the general public and craving its indulgence.[218]

The subject of political economy is Man.

However, it does not embrace man in his entirety.[219] Religious sentiment, paternal or maternal tenderness, filial piety, love, friendship, patriotism, charity, politeness – all the attractive areas of fellow-feeling have been taken over by moral philosophy. Its companion, political economy, has been left only the cold domain of self-interest.[220] This is what is unjustly forgotten when this science is criticised for lacking the charm and sweetness of moral philosophy.[221] Can this be possible? You may question the subject’s right to exist, but do not force it to produce a travesty of itself. If the human transactions, whose object is wealth, are vast enough and complicated enough to give rise to a specific science, let it take on its own appearance and do not reduce it to discussing self-interest in the language of feelings. For my part, I do not believe that it has been served by recent demands that it use a tone of enthusiastic sentimentality that, in its mouth, can only be bombast. What does the subject cover? Transactions carried out by people who do not know one another, who owe each other nothing save justice, and who defend (their) self-interests and seek to have them prevail. It is a question of claims that mutually limit one another, and where self-denial and self-sacrifice have no place. If you pick up a lyre to accompany your discussions of these things, I would be just as pleased if Lamartine[222] were to consult a logarithm table in order to sing his odes.

It is not that political economy doesn’t also have its (own) poetry. [223]Poetry is everywhere where order and harmony reign. But it is (found) in the results and not in the process of demonstration. It is revealed but not created. Kepler[224] did not claim to be a poet, and yet the laws he has discovered are the true poetry of the mind.

Thus, political economy merely looks at man from one aspect, and our first preoccupation ought to be to study man from this point of view. This is why we cannot avoid going back to the most basic phenomena of human sensation and human action.[225] Readers should nevertheless be reassured. We will not be spending much time in the misty regions of metaphysics and we will be borrowing from this science only notions that are simple, clear, and if possible incontrovertible.

The soul, or to avoid going into the question of spirituality, man, is endowed with sensation. Whether sensation is in the soul or the body, it remains a fact that man as a passive being experiences painful or pleasurable sensations. As an acting being,[226] he makes an effort to avoid the former and increase the latter. The result, which still affects him in his passive aspect,[227] can be termed (a) Satisfaction.[228]

From the general notion of sensation more specific ideas arise, those of pain,[229] needs, desires, tastes, and appetites on the one hand,[230] and pleasures, enjoyment, consumption,[231] and well-being on the other.

Between these two extremes may be found the mean, and from the general notion of action more specific ideas arise, those of pain, effort, fatigue, work, and production.[232]

When we analyze sensations and actions, we find a word common to both spheres, the word pain. It is a painful to experience certain sensations and we can stop it only through an effort that is also painful. This tells us that on this earth we have scarcely more choice than that between (two) evils.

Everything in this group of phenomena is personal, the sensation that precedes effort as much as the satisfaction that follows it.

We can therefore have no doubt but that self-interest is the mainspring of the human race. It must be fully understood that the language here expresses a universal and incontestable fact, one that results from human nature. It is not a critical judgment as the word egoism would be. The moral sciences would be impossible if the terms they are obliged to use were corrupted in advance.

Human effort does not always and of necessity come between sensation and satisfaction. Sometimes satisfaction is achieved on its own. In most cases, effort is exercised over material things by means of forces that nature has made available to man gratuitously.

If you call utility all that is achieved by the satisfaction of needs, there are thus two sorts of utility. One sort is given to us freely by Providence and the other, so to speak, is bought by means of an effort.[233]

Thus, the full process encompasses or may encompass the following four ideas:

Need. | Gratuitous utility/ onerous utility |Satisfaction (of need).

Man is provided with faculties that progress. He compares (things), foresees, learns, and changes (himself) through experience. Since if need is a source of pain, (and) effort is also a pain, there is no reason why he should not seek to reduce effort wherever he can without undermining the satisfaction that is its goal. This is what he achieves when he manages to substitute gratuitous utility for onerous utility, and this is the constant objective of his search.

It follows from the self-interested nature of our being, that we are constantly seeking to increase the ratio of our satisfactions to our efforts, and it follows from the intelligent nature of our minds that for each given result, we succeed in increasing the ratio of gratuitous utility to onerous utility

Each time that progress is made in this sphere, part of our effort becomes available (for other things), so to speak, and we have the option either of allocating ourselves longer periods of rest or of working toward the satisfaction of new desires, should our hearts have formulated any that are powerful enough to stimulate our activity.

This is the basis of all progress in the economic order and, as is easily understood, it is also the basis of all disappointment, for progress and disappointment are rooted in this special and marvelous gift that God has given to man, free will.

We are endowed with the ability to compare, judge, to choose, and to act in the light of this, which implies that we are able to make a good or bad judgment or a good or bad choice. It is never pointless to remind people of this when we speak to them about freedom.

It is true that we make no mistake with regard to the private nature of our sensations, and we discern with an infallible instinct whether they are painful or pleasant. But how many forms our errors can take! We can misjudge the cause and enthusiastically pursue what will inflict pain on us as though it were bound to bring us satisfaction, or else misjudge the series of effects and fail to see that an immediate satisfaction will be followed by greater subsequent pain, or again miscalculate the relative importance of our needs and our desires.

Not only can we direct our efforts down the wrong path through ignorance, but also through a perversion of will. “Man," says Mr. de Bonald, “is a mind served by organs.”[234] What then! Are we made of nothing else? Do passions not exist?

Therefore, when we speak of harmony, we do not mean to say that the natural arrangement of the social world is such that error and vice are excluded from it; to support this thesis in the face of the facts would be to extend a mania for theory to insane levels. For harmony to exist with no disharmony[235] it would be necessary either for man to have no free will or for him to be infallible. We will just say this: the major social tendencies are harmonious given that, since all error leads to disappointment and all vice to punishment, disharmony tends to disappear quickly.[236]

An early and vague notion of property[237] can be inferred from these premises. Since it is the individual who experiences the sensation, the desire, and the need,[238] since it is he who makes the effort, it follows by necessity that the satisfaction should come to him, without which condition, the effort would have no raison d’être.

This is also true for inheritance. No theory, no oratorical outbursts, will stop fathers[239] loving their children. People who take delight in arranging imaginary forms of society may find this shocking, but this is how things are. A father will make as much effort to ensure the satisfaction of his children as for his own. Indeed, perhaps he will make more for them. If, therefore, a law that goes against nature prohibited the transfer of property, not only would it in itself violate property rights but it would also prevent its formation by inflicting inertia on at least one half of human effort.[240]

Self-interest, property, and inheritance: we will have the opportunity to return to these subjects (later).[241] First of all,[242] let us attempt to define the boundaries of the science with which we are dealing.

I am not one of those who think that a science has inherently any natural and immutable boundaries. In the realm of ideas, as in that of facts, everything is tied together, everything is connected, all truths are based on each other, and no science can fail to embrace them all if it is to be complete. It has been said with reason that for an infinite form of intelligence there would be only one single truth. It is thus our weakness that reduces us to studying in isolation a certain order of phenomena, and the resulting classification cannot escape a certain arbitrariness.

The real merit lies in setting out the facts, their causes, and their consequences, accurately. Another merit, a lesser and purely relative one, lies in determining in a manner (which is) not rigorous, since that would be impossible, but rational, the order of facts one proposes to study.

I state this so that it might not be assumed that I intend to criticize my predecessors if I succeed in giving political economy limits that differ slightly from those they have assigned to it.

Recently, economists have been greatly criticised for having concentrated too much on the study of wealth.[243] People wanted them to include in the science all that closely or remotely contributed to the happiness or suffering of the human race, and they went so far as to assume that the economists were denying (the existence of) everything that they did not deal with, for example, the phenomena surrounding the principle of fellow-feeling, is something as natural in people’s hearts as the principle of self-interest. It is as though mineralogists were being accused of denying (the existence of) the animal kingdom. Goodness me! Are wealth and the laws governing its production, distribution, or consumption not a sufficiently wide and important field to be the subject of a specific science? If economists’ conclusions contradicted those of politics or moral theory, I would understand the accusation. They might be told: “By limiting your scope you have been led astray, for it is not possible for two truths to be in collision.” Perhaps one conclusion of the work I am submitting to the public may be that the science of wealth is in perfect harmony with all the others.[244]

Of the three terms that encompass human destiny – sensation, effort, and satisfaction - the first and last of these are, always and of necessity, combined within the same individual. It is impossible to imagine them separated. We might imagine a sensation that is not satisfied or a need unmet but never has anyone been able to conceive of a need in one man and its satisfaction in another.

If this were also true for the middle term, effort, man would be a totally solitary being. Economic phenomena would be completely realized within an isolated individual. There might be (other) persons nearby but there would be no society. There might be a personal economy but there never could be a political economy.

But this is not so. It is very possible and it frequently happens that the need of one person owes its satisfaction to the effort of another. That is a fact. If each of us reviewed all the satisfactions that we received, we would acknowledge that, for the most part, we owed them to efforts that we had not made, and in the same way, the work we do in whatever employment we have, almost always goes to satisfy desires that are not within us.

This tells us that it is neither in the needs nor the satisfactions, phenomena which are essentially personal and incapable of being transmitted, but in the nature of the middle term, human effort, that the social principle, the origin of political economy, must be sought.

It is, in fact, this ability given to man, and man alone of all the creatures, to work for one another, and it is this transfer of effort, this exchange of services, with all the complicated and infinite combinations to which it gives rise through time and space, that constitutes economic science, (and) reveals its origin and sets its limits.

Therefore I say:

What forms the domaine of political economy is any effort (which is) likely to satisfy the needs of a person other than the one who has made it (the effort), provided that it is reciprocated, and also consequently the needs and satisfactions which are related to this kind of effort.

Thus, to cite an example although the action of breathing contains the three terms that make up the economic phenomenon it does not belong to this science, and the reason for this is clear: the question here concerns a collection of facts in which not only the two extremes, need and the satisfaction (of one’s needs), cannot be transmitted (this is always so), but where the middle term,[245] effort, is also not transferable. We need nobody’s help to breathe; no service is either given or received. This fact is individual by nature, not social, and so cannot be included in a science based entirely on relationships, as its very name indicates.

However, should men need to help each other to breathe under specific circumstances, as when a diver descends in a diving bell, or a doctor treats someone’s lungs, or when the state regulators take steps to purify the air, we have in this situation a need satisfied by the effort of another person than the one experiencing it. A service is provided, and breathing itself, at least in this respect, enters the domain of political economy as far as assistance and remuneration are concerned.

It is not necessary for the transaction to be carried out; it is enough for the transaction to be possible for the work to be economic in nature. A farmer who grows wheat for his own use performs an economic act for the sole reason that the wheat can be exchanged.

To make an effort in order to satisfy the needs of others is to provide these persons with a service. If a service is agreed upon in return, there is an exchange of services,[246] and as this is the most common practice, political economy may be defined as being the theory of exchange.

However pressing the need for one of the contracting parties or intense the effort required of the other, if the exchange is freely made the two services are of equal value. The value therefore consists in the comparative evaluation of the reciprocal services, and (thus) it may also be said that political economy is the theory of value.[247]

I have just defined political economy and established its boundaries without mentioning an essential element; gratuitous utility.

All our authors have drawn our attention to the way we derive a host of satisfactions from this source. They called this type of utility, such as air, water, sunlight, etc. natural wealth, as opposed to social wealth and from then on took no further notice of them,[248] and indeed it seems that, as they do not give rise to any effort, exchange, or service and are not included in any inventory (since they are) devoid of value, they ought not to enter into the realm of the study of political economy.

This exclusion would be rational if a gratuitous utility was a fixed quantity that never changed and if it were always separate from onerous utility, but the two kinds are constantly combined and in inverse ratio. Man constantly applies himself to substituting one for the other, that is to say, to achieving the same results using gratuitous natural resources with less effort. Using the wind, gravity, heat, or the expansion of steam, he manages to achieve what he initially achieved by muscular strength alone.

So what happens? Although the useful effect is the same the effort expended is less. Less effort implies a lesser service, and a lesser service implies less value.[249] Each stage of (in our) progress thus eliminates value, but how does it do this? Not by eliminating the useful effect but by substituting a gratuitous utility for an onerous utility, and natural wealth for social wealth. From one point of view, this portion of the value that is eliminated is outside the scope of political economy, just as it is excluded from our inventories, for it is no longer exchanged, sold, or bought and the human race benefits from it with no effort and almost without realizing it. It is no longer an element in our relative wealth but one of the gifts of God.[250] However, on the other hand, if science no longer took account of it, then science would surely go astray, for it would lose sight of exactly what is essential, the principal consideration in everything: the (end) result, or the useful effect. It would fail to recognize the strongest communal and egalitarian tendencies and would see everything in the social order (except for) harmony. And if this book is intended to enable political economy to move forward by one step it is above all by keeping the reader’s attention constantly focused on the portion of value[251] successively eliminated and made use of as a gratuitous utility, by the entire human race.

I will make one comment here that will prove how closely the sciences are involved with each other and how they almost blend with each other.

I have just defined service. It is the effort made by one man while the need (resides in) and the satisfaction (is enjoyed) in another. Sometimes the service is given free of charge, without reward or without any service being required in return. In this case, it is based on the principle of fellow-feeling rather than on that of self-interest. It constitutes a gift and not an exchange. Consequently, it would appear not to belong to political economy (which is the theory of exchange),[252] but to moral philosophy. In effect, actions of this nature are, because of their motives, more moral than economic (in their nature). However, we will see that, because of their effects, they are of interest to the science we are considering. On the other hand, onerous services rendered in return for payment, while they are for this reason essentially economic, are not in terms of their effects, outside the sphere of morality.

Thus, these two branches of knowledge have an infinite number of points of contact, and since two truths cannot be in conflict, when an economist attributes disastrous consequences to a phenomenon while at the same time a moral philosopher attributes favorable effects to it, it can be stated that one or other of them is mistaken. In this way, the sciences can be checked against each other.

 


 

III. On the Needs of Man[253]

It is perhaps impossible, and in any case it would not be very useful, to put forward a complete and methodical catalog of man’s needs. Almost all of those that are truly important are included in the following list:

Respiration (I am including this need here as being the point at which the transfer of labor or the exchange of services begin), food, clothing, shelter, the maintenance and restoration of health, a means of travel, security, education, entertainment, and an appreciation of the beautiful.[254]

Needs exist. That is a fact. It would be puerile to enquire whether it would not be better for them not to exist and to ask why God has subjected us to them.

It is certain that man suffers and even dies when he cannot satisfy the needs that arise from his very nature. It is certain that he suffers and may even die when he satisfies some of them to excess.

We are able to satisfy the majority of our needs only if we take the trouble to (do so), a trouble which may be considered a form of suffering. This is also true of the actions which we take to deprive ourselves (of something) when we exercise a noble control over our appetites.

Thus suffering is inevitable, such that what is left to us is scarcely more than a choice of harms. What is more, this suffering is the most intimate and personal thing in the world, from which it follows that self-interest, decried these days as mere egoism and individualism, is indestructible. Nature has placed sensation at our nerve endings, and at all the approaches to our hearts and minds, like some advanced sentry, to warn us when there is either a lack or an excess of satisfaction. Pain thus has both a purpose and a mission. The question has often been asked whether the existence of evil can be reconciled with the infinite goodness of the Creator, an awesome problem that philosophy will always continue to grapple with and probably never succeed in solving. As for political economy, it has to take man as he is, all the more so since it has not been given to imagination itself to work out, and still less to reason to conceive, a living mortal being free of pain. All our efforts to understand sensation without pain or man without sensation would be in vain.

In these times, a few sentimentalist schools of thought reject as false any form of social science that has not devised a synthesis by means of which pain disappears from the face of this earth. Their judgment of political economy is severe, because political economy accepts what it is impossible to deny, namely suffering. They go further and make political economy responsible for it. It is as though the frailty of our organs were attributable to the physiologist examining them.

Doubtless, you can make yourself popular for a while, attract men who are suffering to your cause and inflame them against the natural order of society, by announcing that you have conceived a plan for the artificial organization of society[255] in which pain in any form would be excluded. You might even claim to have stolen the secret from God and interpreted His presumed will by banishing evil from the face of the earth. And people unfailingly brand as impious any science that did not make this claim, accusing it of failing to recognize or of denying the foresight or the power of the author of all things.

At the same time, these schools paint a dreadful picture of present societies and do not realize that if it is impious to foresee suffering in the future, it is no less so to note it in the past or the present. For there is no limit to infinity, and if one single man in the world has suffered since the creation that would be enough to enable us to accept, with no impiety, that pain has entered into the Providential plan.

It is certainly more scientific and more powerful to acknowledge the existence of major natural events that not only exist but are such that without them the human race could not even be imagined.

Thus, man is subject to suffering, and consequently so is society.

Suffering has a function in individual people, and consequently in society as well.

A study of the social laws will show us that the purpose of suffering is to destroy its own causes gradually and to draw around itself increasingly narrow limits, and finally, assuring the final predominance of the good and the beautiful by making us both earn and deserve it.[256]

The list I gave above places material needs first.

We live at a time that obliges me to put the reader on guard once more at this point against a form of sentimental affectation that is highly fashionable.

There are some who give short shrift to what they disdainfully call material needs and material satisfactions. In the words of Bélise to Chrysale, they would doubtless tell me:

Is the body, this rag, of any importance?

Or worth enough to warrant even a passing thought?[257]

And, although they are in general well provided for with everything, and I congratulate them sincerely for this, they will criticize me for having pointed out food, for example, as one of our prime needs.

I certainly acknowledge that moral development is of a higher order than physical maintenance. But in the end, are we so given over to this mania for declamatory rhetoric that we cannot say that, in order to make progress, we have to be alive first? Let us avoid this childishness that obstructs science. By wanting to seem philanthropic we become untruthful, for it is contrary alike to reason and to the facts that moral development, a concern for dignity, and the cultivation of refined feeling, can precede the requirements of simply staying alive. This affected moralizing is entirely modern. Rousseau, that enthusiastic eulogist of the state of nature, refrained from such and Fénelon, a man endowed with exquisite delicacy and a sweet tenderness of heart, a spiritual being to the point of quietism and a stoic in his own regard, said: “After all, strength of mind consists in desiring to ascertain accurately the way in which the things that are fundamental to human life are constituted. Every major question turns on this.”[258]

Without our claiming therefore to classify needs into a rigorously methodical order, we can say that man cannot direct his efforts to satisfying moral imperatives of the noblest and most elevated kind until he has seen to those that relate to the maintenance and sustenance of life. From this, we can already conclude that any legislative measure[259] that makes material life more difficult undermines the moral life of nations, a harmony which I draw in passing to the reader’s attention.[260] [261]

Since the opportunity presents itself, I will draw attention to another.

Since the fundamental necessities of material life are an obstacle to intellectual and moral culture, it follows that more virtues must be found in prosperous nations and classes than in those that are poor. Good heavens! What have I just said and what clamor has arisen to deafen me! It is a real mania these days to attribute the monopoly of all devotion, self-denial, and everything that constitutes moral greatness and beauty to the impoverished classes, and this mania has recently spread further under the influence of a revolution that, having brought these classes to the forefront of society, could not fail to attract a rabble of flatterers to them.[262]

I do not deny that wealth and above all opulence, especially when it is very unequally distributed, tends to develop a particular range of vices.

But is it possible to accept that, in general, virtue is the prerogative of poverty, and vice the sorry and faithful companion of prosperity? This would be to claim that intellectual and moral culture, which is compatible only with a certain degree of leisure[263] and well-being, operates to the detriment of intelligence and morality.

And at this point I call upon the sincerity of the suffering classes themselves. To what terrible disharmonies[264] would a paradox of this nature lead!

It would therefore have to be said that the human race is faced with this frightful alternative: either it remains forever impoverished or it moves forward to increasing immorality. From that time onward, all the forces that lead to wealth, such as (economic) activity, thrift, order, skill, or good faith will be the seedbeds of vice, while those that keep us in poverty, such as lack of planning, laziness, debauchery, or negligence, will be the precious seeds of virtue. Can a more depressing disharmony ever be imagined in the moral world? And, if this were so, who would dare to speak to the people and give them advice? They would have to say: “You are complaining of your suffering and want to see it cease rapidly. You are groaning under the yoke of the most pressing physical need and you long for the hour of your release, for you would like some leisure in which to develop your intellectual and emotional capacities. For this reason you want to make your voice heard in the political sphere and make your interests known there. However, get to know the truth about what you want and how fatal to you the success of your desires would be. Well-being, prosperity, and wealth aggravate vice. Therefore you should cherish your poverty and virtue preciously.”

Flatterers of the people thus sink into obvious contradiction when they identify wealth as a vile sink of egoism and vice and at the same time, often using the most illegitimate means in their haste, they urge the people forward to this deadly condition.

No, discord[265] like this cannot be found in the natural order of society. It is not possible for all men to aspire to well-being, with the natural path to this found in the exercise of the crudest values, and the search achieved subsequently only by their falling under the yoke of vice. Such ranting is good only for fanning and keeping alight class hatred. If correct, it would locate the human race half way between poverty and immorality; if false, it would be making lies serve disorder, and by deceiving people it would bring to blows the classes that ought to like one another and help each other mutually.

Yes, an artificial form of inequality, one that is created by the law when it upsets the natural order of development of the various classes in society, (and which) is a fertile source of resentment, jealousy, and vice for all. This is why we have to find out whether this natural order does not lead toward the equalisation and the gradual improvement of all classes, and our enquiries into this would be faced with a flat rejection if this twofold progress in the material sphere inevitably implied a twofold degradation in the moral one.[266]

I have one important remark to make on human needs, one that is even fundamental in political economy, and this is that needs are not a fixed and immutable quantity. They are not static by nature, but progressive.

This characteristic is notable even in our most physical needs, and becomes more apparent as we go up the scale to the intellectual desires and tastes that mark man out from the beasts.

It appears that if there is something that men ought to have in common it is the need for food since except for abnormal cases stomachs are approximately the same.

However, the foods that were rare at one period have become commonplace in another, and the diet that would be enough for a beggar would subject a Dutchman to torture. For this reason, this most pressing and bodily need, and consequently the most uniform of all, even so varies with age, sex, temperament, climate, and habit.

This is true for all the others. Scarcely has man found himself a shelter than he wants a house. Scarcely has he clothed himself than he wants adornment, and scarcely has he satisfied his bodily needs than study, science, and art open out a boundless field to his desires.

The promptness with which what was just a vague desire becomes a taste, and what was just a taste is transformed into a need, and even a pressing one, is a phenomenon worthy of note.

Take this rough and hard-working artisan.[267] He is used to a coarse diet, humble clothes, and a mediocre lodging but thinks that he would be the happiest of men, with no further desires, if he were able to reach the rung of the ladder that he sees immediately above him. He is amazed that those who have reached this are still unsatisfied. In effect, should the modest good fortune he has dreamt of arrive, he would be happy, happy, alas, just for a few days.

For very soon he would become used to his new state, and little by little he would cease to notice his so-called good fortune. He would automatically put on the garment he had yearned for. He has made himself a new environment, he mixes with different people and, from time to time, his lips drink from a different cup, and so he aspires to climbing another rung, and if he examines his own past life he realizes that while his fortune has changed his spirit has remained the same as it was, an insatiable source of desires.

It appears that nature has given habit a peculiar power, so that it acts in us like a ratchet wheel in mechanics, and that the human race, forever impelled toward increasing higher regions, is never able to stop at any stage of civilization.

Perhaps, the sense of (one’s own) worth acts with even greater force in the same direction. Stoic philosophy has often criticized men for wanting to appear rather than to be. However, taking things generally, is it certain that the business of appearing is not one of the ways of being for men?

When, through work, order, and thrift, a family rises by degrees to the social regions in which tastes become increasingly refined, relationships more polished, sentiments more purified, and the intellect more cultured, who is not aware of the poignant pain that accompanies a downturn of fortune that obliges it to descend (the social ladder)?[268] This is when it is not the body alone that suffers. (This) descent breaks off habits that have become second nature, as we say. The sentiment of (self-)worth is undermined, and with it all the powers of the spirit. For this reason, it is common in these cases to see the victims give way to despair and slump suddenly into a degrading level of brutishness. It is as true for the social environment as for the atmosphere. Mountain dwellers who are used to pure air become rapidly less healthy in the narrow streets of our cities.

I can hear people crying out to me: “Economist, you are already stumbling. You said that your science was in harmony with with the moral code[269] and here you are, justifying sybaritic (self-indulgent) luxury.” “Philosopher,” say I, in turn, “take off these clothes that were never worn by primitive man, smash your furniture, burn your books, eat the raw flesh of animals, and I will then answer your objections. It is too easy to question the power of habit, of which we are only too willing to be the living proof (of what it can achieve).”

This inclination with which nature has endowed our organs may be criticized, but criticism will not prevent it from being universal. It is seen in all nations, whether ancient or modern, savage or civilized, at the antipodes or in France. Without it, it is impossible to explain civilization. Well, when an inclination of the human heart is universal and indestructible, can social science take the liberty of not taking it into account?

Political writers who pride themselves on being the disciples of Rousseau will put forward this objection. But Rousseau has never denied the phenomenon of which I am speaking. He notes positively both the indefinite elasticity of our needs and the power of habit, and the very role I am assigning to him, which consists in preventing the human race from taking a backward step. The only thing is that what I admire he deplores, and this is to be expected. Rousseau assumes that there was a time in which men had no rights, duties, relationships, affections, or language, and that it was then, in his view, that men were happy and perfect. He must therefore have hated this wheel in the social mechanism[270] which is taking mankind further and further from ideal perfection. Those who, on the contrary, think that perfection was not at the beginning but will be at the end of human evolution, admire the mainspring that impels us forward. But with regard to the existence and the workings of the spring itself we are in agreement.

“When men," he said, “enjoyed a great deal of leisure and used it to procure for themselves all sorts of commodities unknown to their fathers, this was the first yoke they placed upon themselves without realizing it, and the first source of misfortune that they prepared for their descendants for, apart from the fact that these products were thus contributing to softening up men’s bodies and minds, such commodities lost their attraction through habit, and when at the same time they degenerated into real needs, being deprived of them became much more cruel than the pleasure obtained from their possession, and people were much more unhappy at losing them than they were happy at enjoying them.”[271]

Rousseau was convinced that God, nature, and the human race were mistaken. I know that this opinion is still anchored in many minds, but I do not share it.

After all, God forbid that I should wish to speak out against the most noble attribute, the finest virtue of man, his ability to dominate his passions, moderate his desires, and scorn sumptuous pleasures. I do not say that he should become a slave of this or that artificial need. I do say that need, considered in general terms, and seen as a result of both the physical and non-material natures of man and the force of habit and sense of worth, is indefinitely extendable, because it arises from an inexhaustible source, namely desire. Who will criticize a wealthy man if he is sober, restrained in the way he dresses, and eschews ostentation and indolence? Are there no more elevated desires, however, to which he is allowed to yield? Has the need for education any limit? Are efforts to render service to his country, subsidize the arts, propagate useful ideas, or assist his unfortunate brethren incompatible with the generally accepted uses of wealth?

What is more, whether philosophy thinks it is right or wrong, human need is not a fixed and immutable quantity. This is a certain fact, incontrovertible and universal. In no way were needs in the fourteenth century the same as ours with regard to food, accommodation, and education, and we can safely say that ours will not be the same as those to which our descendants are subject.

This incidentally, is an observation common to all the elements covered by political economy: wealth, work, values, services, etc., all things pertaining to the extreme variability of our principal subject, man. Political economy, unlike geometry or physics, does not have the advantage of speculating on objects that can be weighed or measured, and this is both one of its difficulties in the first place and subsequently a perpetual source of error; for when the human mind is applied to a particular order of phenomena, it is naturally inclined to seek a criterion, a common measure to which he can relate everything in order to give the branch of knowledge with which he is dealing the characteristic of an exact science. For this reason, we see most authors looking for a degree of stability, some in value, others in money, or wheat, or work,[272] that is to say in things which are constantly changing.

A great many economic errors arise because human needs are considered a fixed quantity, and this is why I thought it necessary to extend myself somewhat on this subject. I do not think I am getting ahead of myself by saying briefly how people reason on this subject. They take all the general satisfactions (enjoyed) at the time in which they live and assume that the human race will not agree to (any) others. This being so, if nature’s bounty, the power of machines, or temperate and moderate habits manage to paralyse for a (short) time some portion of human labor, this advance causes worry, it is thought a disaster, and refuge is sought behind absurd and also erroneous mantras such as: We have overproduction, we are being killed by over-supply, production is exceeding our ability to consume, etc.

It is impossible to find a proper solution to the problem of machines, foreign competition, or luxury[273] if you consider need to be an invariable quantity, and do not realize that it is indefinitely expandable.

But if man’s needs are unlimited, progressive, and able to increase according to one’s desires, which are an unquenchable source which feeds them (needs) incessantly, nature must have placed in man and around him the unlimited and progressive means of satisfying them, otherwise there would be disharmony (discordance) and contradiction in the economic laws governing society, since equilibrium between the means and the end is the prime condition of any form of harmony. This is what we are going to investigate.[274]

At the beginning of this work, I said that the subject of political economy is man,[275] considered from the point of view of his needs and the means by which it is given to him to meet them.

It is therefore natural to start by examining man and his nature.

But we have also seen that he is not a solitary being; while his needs and his satisfactions, given the nature of his sensations, are inseparable from his being, this is not true of his efforts, which arise from the principle of action.[276] Efforts can be transferred. In a word, men work for each other’s benefit.

Well, something very odd happens.

When you consider man, his needs, efforts, satisfactions, constitution, leanings, or tendencies in general and in an abstract fashion, so to speak, you arrive at a series of observations that appear to be free of any doubt and which are seen to be blindingly obvious, with each carrying its own proof within it.[277] This is so true that the writer is at a loss as to how to present such palpable and widely known truths to the general public, for fear of arousing a scornful smile. It seems to him quite rightly that the annoyed reader will toss aside the book saying, “I will not waste my time being told such trivialities.”

And yet these truths, held so incontrovertible when presented generally that we scarcely allow ourselves to be reminded of them, now appear to be just ridiculous errors and absurd theories when man is observed in a social setting. When considering man living in isolation, who would be tempted to say: “We have overproduction, our ability to consume cannot keep up with our ability to produce; luxury and artificial tastes are the source of wealth; the invention of machines is wiping out work” and other pithy sayings of the same order which, when applied to humans collectively, nevertheless appear so well established that they are made the basis of our industrial and commercial laws? Exchange in this context produces an illusion to which the best honed intellects cannot avoid giving way, and I would propose that political economy will have achieved its goal and fulfilled its mission when it has finally demonstrated the following: What is true for the individual is true for society. Man living in isolation is simultaneously a producer and (a) consumer,[278] (an) inventor and (an) entrepreneur,[279] (a) capitalist and (a) worker. All economic phenomena are fulfilled in him, and he is so to speak society in the abstract. In the same way, the human race, taken as a whole, is a (like a) huge, collective, and multiple man to whom the truths observed in even a single individual can be applied.

I needed to make this remark, which I hope will be better justified by what follows, before continuing this study of man. Without this, I feared that the reader would reject as unnecessary the inferences and obvious truisms that follow.

I have just spoken of man’s needs, and after putting forward a rough and ready list, I noted that they were not static by nature but progressive. This is true whether you consider each of them in itself or, above all when you take them as a whole from the physical, intellectual, and moral points of view. How could this be otherwise? Some needs must be satisfied under pain of death given the way our bodies are constituted, and up to a certain point it might be claimed that these latter are of fixed magnitude, even though this may not of course be strictly true, for if you are keen not to overlook an essential element, the force of habit, and prepared to do some self-examination with a degree of good faith, you will be obliged to agree that even the most basic needs, such as eating, undergo incontrovertible transformation by force of habit, and anyone who speaks out here against this comment, calling it materialistic and epicurean, would be most unhappy if he were taken at his word and reduced to the black broth of Sparta or the pittance of an anchorite.[280] But in any case, when the needs of this order are met satisfactorily and constantly, there are others that arise from the most expandable of our faculties, namely desire. Can one imagine a single moment in which man is unable to formulate desires, even reasonable ones? Let us not forget that a desire that is unreasonable at one stage of civilization, at a time when all human powers are concentrated on satisfying lesser needs, ceases to be so when the advancement of these powers opens out a wider horizon. Thus, it would have been unreasonable two centuries ago to hope to travel at ten leagues an hour,[281] which is no longer the case today. To claim that man’s needs and desires are fixed and static quantities is to fail to understand the nature of the soul, to deny the facts and make civilization inexplicable.

It would also be inexplicable if, alongside the indefinite development of needs, the possibility of the indefinite development of the means of satisfying them did not materialize. What would be the effect on the expandable nature of needs in the achievement of progress if, at a certain stage, our capacities were no longer able to develop and were to run up against an unmovable barrier?

Thus, unless nature, Providence, or whatever the power that presides over our destinies, has become a victim to the most shocking and cruel ambiguity, since our desires are indefinite, it must be presumed that our means of satisfying them are equally so.

I have used the word indefinite, and not infinite, for nothing relating to man is infinite. It is precisely because our desires and capacities develop towards infinity that they have no specifiable limits, although they may have absolute ones. We can cite a host of points higher than the human race to which it will never rise, without at the same time being able to say that a time will come at which it will cease to draw closer to them.[282]

Nor do I mean to say that desire and the means of satisfying it walk side by side at an equal pace. Desire runs, and the means limp along behind it.

The swift and adventurous nature of desire, compared to the slowness of our capacities, warns us that, at all stages of civilization and all levels of progress, a certain degree of suffering is and always will be the lot of man. However, it teaches us also that this suffering has a purpose, since it would be impossible to understand desire as the stimulus of our capacities if it followed instead of preceding them. Nevertheless, let us not accuse nature of having installed cruelty in this (social) mechanism, since it has to be noted that desire is not transformed into a genuine need, that is to say into a painful desire, until it has been made so by the habit of permanent satisfaction, in other words, when the means have been found and put irrevocably within our reach.[283]

Today, our task is to examine the following question: What means do we possess to satisfy our needs?

It seems obvious to me that there are two: nature and labor, the gifts of God and the fruits of our efforts, or if you prefer, the application of our capacities to the things that nature has placed at our service.

As far as I know, no school has attributed the satisfaction of our needs to nature alone. A statement like this has been too frequently belied by experience, and we do not need to study political economy to see that some input from our capacities is necessary.

But there are some schools that have attributed this privilege to labor alone. Their maxim is: “All wealth stems from labor; labor is wealth.”

I cannot stop myself from pointing out here that these formulae, taken literally, have led to huge errors of doctrine, and consequently to deplorable legislative measures. I will deal with this elsewhere.[284]

Here I will limit myself to establishing as fact that nature and labor cooperate to satisfy our needs and desires.

Let us examine the facts.

The need that we have placed on top of our list is that of breathing. In this respect, we have already noted that, in general, nature does all the work and that human labor has only to intervene in certain exceptional cases as, for example, when it is necessary to purify the air.

The need to quench our thirst is more or less satisfied by nature, depending on whether it provides us with a source of water that is more or less close, clear, and abundant, and the contribution of labor is linked to the distance it has to be carried, whether it has to be purified, and whether its scarcity has to be supplemented by wells and tanks.

Nature is no more uniformly liberal to us with regard to food, for who will say that the work left to us is always the same whether the soil is fertile or difficult, the forest teeming with game, the river with fish or not?

With regard to lighting, human labor certainly has less to do in places where (the) nights are short than in places where the sun has chosen to make them long.[285]

I will not dare at this point to set this out as an absolute rule, but it seems to me that, as we ascend the scale of (our) needs,[286] the input of nature becomes less and gives more scope to our capacities. Painters, sculptors of statues, and even writers are obliged to obtain help from materials and tools that nature alone supplies, but it has to be admitted that they draw from their own genius the element that provides the attractiveness, the merit, the usefulness, and value of their works. To learn is a need that is almost exclusively satisfied by the properly directed exercise of our intellectual faculties. Nevertheless, might it not be said that here again nature assists by offering us, in varying degrees, objects to be observed and compared? For an equal amount of work, can botany, geology, and natural history make equal progress everywhere?

It would be superfluous to give other examples. We can already ascertain that nature gives us the means of satisfaction with a greater or lesser degree of utility (this word is taken in its etymological meaning, the property of serving).[287] In many cases, (in fact) in almost every case, there is something left for labor to do to make this utility complete, and we understand that this action of work is capable of achieving more or less in a given situation depending on how far nature itself has advanced the operation.

The following two formulae may therefore be advanced:

1. Utility is transmitted, sometimes by nature alone, sometimes by labor alone but almost always by the cooperation of nature and labor;

2. To bring something to its perfect state of UTILITY, the action of labor is in an inverse ratio to that of nature.

From the combination of these two propositions and what we have said about the indefinite expandability of needs, may I be allowed to draw a deduction whose importance will be demonstrated below? If two men who are assumed to have no links with one another are placed in unequal situations so that nature is liberal toward one and miserly toward the other, the first will obviously have less work to do for any given satisfaction. Does it follow that the portion of his strength that has been, so to speak, left available will of necessity be afflicted with inertia, and that this man, because of the bounty of nature, will be reduced to forced idleness? No, what results is that, should he so wish, he will be able to use this strength to widen the circle of his satisfactions, and for the same amount of work achieve two satisfactions instead of one. In a word, progress will be easier for him.

I do not know whether I am deceiving myself, but it seems to me that no discipline, not even geometry, offers more unassailable truths at its starting point. However, if someone were able to prove to me that all these truths were just so many errors, he would have destroyed not only the confidence that these truths inspire in me but also the very foundation of all certainty and faith in the evidence itself, for what line of reasoning could we use that would better deserve the acceptance of reason than the one we would have overthrown? The day when an axiom is found to contradict the one which holds that a straight line is the shortest path between two points, will be the day on which the human mind will have no other refuge than absolute skepticism, if this is indeed a refuge.

So I feel very confused at having to stress elemental truths so clear that they seem puerile. Nevertheless, it has to be said that through the complications of human transactions, these simple truths have been overlooked, and in order to justify to the reader my dwelling on what the English call truisms for so long, I will point out at this juncture the strange way that excellent minds have allowed themselves to be led astray. Setting aside and taking no account of the cooperation of nature with regard to the satisfaction of our needs, they laid down this absolute principle: All wealth stems from labor. On this premise, they have built the following syllogism:

“All wealth stems from labor;

Therefore wealth is proportional to labor.

But, labor is in inverse proportion to the bounty of nature;

Therefore wealth is in inverse proportion to the bounty of nature!”

And like it or not, many of our economic laws have been inspired by this strange line of reasoning. These laws cannot help but be disastrous to the development and distribution of wealth. This is what justifies my preparing in advance, through the setting out of apparently very trivial truths, the refutation of the deplorable errors and preconceived ideas under which current society is thrashing about.

Let us now break down into its parts the contribution of nature.

It places two things at our disposal: material things and the forces (of nature).

Most of the material objects used to satisfy our needs and desires are transformed into a state of utility suitable for us only through work, through the application of human faculties. However, in every instance, the elements, the atoms if you like, of which these objects are made are the gifts, and I add, the free (gratuitous) gifts, of nature. This comment is of the greatest importance and, I believe, will cast fresh light on the theory of wealth.

I would like the reader to remember clearly that I am examining here in a general fashion the physical and moral constitution of man, his needs, his capacities, and his relationships with nature, setting aside exchange, which I will be dealing with in following chapter. We will then see how and why social transactions modify phenomena.

It is very clear that if a man living in isolation[288] has, so to speak, to buy the majority of his satisfactions through work or effort; it is strictly accurate to say that, before any work or effort from him has taken place, the materials that are within his reach are the free gifts of nature. Following an initial effort, however slight, they cease to be free, and if the language used by political economy had always been accurate, it is when material objects are in this situation, before any human action,[289] that the term raw materials ought to be used.

I repeat here that this gratuitousness[290] of the gifts of nature, before work has intervened, is of the greatest importance. Indeed, in the first article,[291] I stated that political economy was the theory of value. I now add in advance that things start having value only when work has given them some. I claim that I will later[292] be demonstrating that all that is free of charge to man living in isolation remains free for man living in society and that the free gifts of nature, whatever their UTILITY, have no value. I contend that a man who receives a benefit of nature directly and with no effort cannot be considered to have rendered himself an onerous service, and that consequently he cannot render as services to others things which are common to all. Well, where there has been no services rendered or received, there is no value.

All that I am saying here with regard to material things can also be applied to the forces supplied to us by nature. Gravity, the expansion of steam, the power of the wind, the laws of equilibrium, animal and vegetable life, are so many forces that we learn to turn to our advantage. The trouble we take and the intelligence that we devote to this are always subject to payment, for we cannot be made to devote our efforts for the benefit of others free of charge. However, these natural forces, when taken on their own and setting aside all intellectual or muscular work, are the free gifts of Providence, and for this reason they remain without value through all the complications of human transactions. This is the dominant theme of this work.

This observation would have little importance, I admit, if the cooperation of nature was constantly uniform, if each man, at all times, places, and circumstances received from nature assistance that was always the same and invariable. In this case, science might be excused for not taking account of an element that, because it remains the same always and everywhere, has an effect that is proportionally the same in every way on the services being exchanged. Just as you eliminate the parts of the lines in geometry that are common to the two figures being compared, it would be able to set aside this cooperation that is immutably present and content itself with saying, as it has done up to now: “Natural wealth exists; political economy notes this once and for all, and will take no further notice of them.”

But things do not happen like this. The irresistible tendency of the human mind, stimulated in this by self-interest and aided by a succession of discoveries, is to replace the costly and human contribution with the natural and gratuitous contribution, so that for a given utility, although it remains the same with regard to its result and the satisfaction it provides, nevertheless represents an increasingly reduced level of work.[293] Certainly, it is impossible not to perceive the immense influence of this marvelous phenomenon on the notion of value. For what is its result? It is that in every product the part that is free of charge tends to replace the part which is costly. It is that, since utility is the result of two forms of collaboration, one that is paid for and one that is not, the value, which is linked only to the first of these forms of collaboration, decreases for an identical utility as nature is forced to provide (a) more effective contribution. So that it can be said that the human race has as many more forms of satisfactions or wealth as it has fewer things of value. Well, as the majority of writers have established a sort of synonymous meaning between the three expressions: utility, wealth, and values, what results is a theory that is not only wrong but the opposite of the truth. I sincerely believe that a more accurate description of this combination of natural and human forces in production, in other words, a more accurate definition of value, would stop inextricable theoretical confusion and reconcile schools of thought that are currently divergent, and if I am now anticipating the result of this exposition,[294] it is in order to justify myself to the reader for having lingered over notions whose importance he would have difficulty explaining without this.

Following this digression, I will go back to my study of man based solely on the economic point of view.

Another observation that I owe to J. B. Say,[295] and whose obviousness leaps to the eye in spite of being all too often overlooked by a number of writers, is that man does not create either the materials or the forces of nature, if the word create is used in its strict sense.[296] These materials and forces exist in their own right. Man merely combines them and moves them (about) for his own benefit or that of others. If he does so for his benefit, he is rendering himself a service. If it is for the benefit of others, he is rendering (a) service to his fellow-man [fellows] and is entitled to demand an equivalent service[297] from him, from which it also follows that the value is in proportion to the service rendered, and not at all to the absolute utility of the action. For this utility may, for the most part, be the result of the gratuitous act of nature, in which case the human (element of the) service, the costly part which should be paid for, has little value. This arises from the axiom established above: To bring something to its fullest state of utility, the action of human beings is in inverse proportion to that of nature.

This observation overturns the doctrine about which I spoke in the first article[298] that situates value in the materiality of things. The contrary is true. Materiality is a quality supplied by nature and consequently free of charge, with no value, although its utility is undeniable. Human action,[299] which can never create matter, is the sole constituent of the service that a man living in isolation can render (to) himself or that men living in society can render (to) each other, and it is the freely (given) appraisal of these services that is the basis of value. Far from the premise, favored by Smith, that value can be conceived only when incorporated in matter, the truth is that between matter and value there is no possible relationship.

The mistaken doctrine to which I refer had inexorably resulted from the idea that only the classes that work on material things were productive. Smith had thus paved the way for the error of modern socialists, who constantly represent those they call the middlemen[300] between producers and consumers, such as traders, merchants, etc. as being unproductive parasites. Do they provide services? Do they spare us pain by taking pains on our behalf? In this case, they create value, although they do not make material things, and it is even true that, since nobody creates matter itself and we all are limited to providing each other with reciprocal services, it is strictly accurate to say that all of us, including farmers and manufacturers, are middlemen with regard to each other.

This, for the moment, is what I have to say about the contribution of nature. It places at our disposal, to a very varying extent depending on the climate, the seasons, and the state of advancement of our knowledge, but in all instances gratuitously, both material things and forces (of nature). These materials and forces therefore have no value, and it would be very strange if they had. According to what rule would we assess it? How would we comprehend nature having itself paid, reimbursed, or remunerated? We will see later that exchange is necessary in determining value.[301] We do not buy the produce of nature, we gather it, and if, in order to gather it, we have to produce a certain effort, it is in this effort, and not in the gift of nature, that the principle of value lies.

Let us move on to that human action (activity)[302] generally referred to as labor.

The word labor, like nearly all the terms used in political economy, is very vague, with each writer giving it a meaning that is more or less wide. Unlike the majority of sciences, chemistry for example, political economy has not had the advantage of inventing its own vocabulary. As it deals with subjects that have concerned man from the dawn of time and are customary subjects of conversation, it has found terminology that is ready-made and been obliged to use it.

Very often the meaning of work is limited to the almost exclusively muscular action of man on things. For this reason, those who carry out the mechanical part of production are referred to as the working classes.[303]

The reader will understand that I am giving this word a wider meaning. What I mean by the word work is the application of our capacities to the satisfaction of our needs. Need, effort, satisfaction, this is the realm of political economy. The effort may be physical, intellectual, or even moral, as we will see.

It is not necessary to show here that all of our organs and all or nearly all of our capacities may and do contribute to production. Concentration, wisdom, intelligence, and imagination certainly play a part.

In his fine book on the The Liberty of Working, Mr. Dunoyer[304] has, with full scientific rigor, included our moral capacities among the attributes to which we owe our wealth. This is an idea that is as new and fertile as it is true , and is intended to enlarge and ennoble the field of political economy.

I will dwell on this idea here only to the extent that it gives me the opportunity of casting an initial beam of light on the origin of a powerful agent of production which I have not mentioned so far: CAPITAL.

If we examine in turn the material objects that contribute to satisfying our needs, we will recognize without difficulty that the production of all or nearly all of them requires more time and a greater portion of our life than man can give without restoring his strength, that is to say, without satisfying his (physical) needs. This presupposes, then, that those who have produced these things will have previously reserved, or set aside and accumulated, the provisions needed to maintain life during the period of the work.

The same applies to satisfactions that have no material element. A priest could not devote himself to preaching, a teacher to teaching, a magistrate to the maintenance of order if, by their own means or those of others, they did not have ready access to some means of existence which had previously been created.

Let us go back and imagine a man living in isolation and reduced to living by hunting.[305] It is easy to see that if, each evening, he had eaten all the game taken during the day, he would never be able to undertake any other task, building a hut, or repairing his weapons. All forms of progress would forever be denied to him.

This is not the place to define the nature and functions of capital;[306] my only aim is to get you to see that certain moral virtues contribute directly to improving our condition, even from the sole point of view of wealth, and (these are) among others, order, foresight, self-control, and thrift.[307]

Foresight is one of the wonderful privileges of man, and it is scarcely necessary to say that, in almost all of the situations in life, the man who best appreciates the consequences of his decisions and actions will have the most favorable opportunities.

To restrain one’s appetites, the ability to govern one’s passions, to sacrifice the present to the future, to subject oneself to present privation with a view to greater advantage in the future,[308] these are essential conditions for capital formation and, as we have glimpsed, capital is itself the essential condition for all forms of work at all complicated or prolonged. It is perfectly clear that if two men were placed in perfectly identical situations and if, in addition, they were assumed to have the same degree of intelligence and industriousness, the one who saved up provisions to enable him to undertake tasks of long duration, improve his tools, and enlist the forces of nature in achieving his plans, would make more progress.

I will not dwell on this; you have only to glance around you to be convinced that all our forces, capacities, and virtues contribute to achieving progress for man and society.

For the same reason, there is no vice of ours which is not a direct or indirect cause of poverty. Laziness paralyses effort, the very sinew of production. Ignorance and error lead it down the wrong path; lack of foresight lays up disappointments for us; giving way to our passing appetites prevents the accumulation or formation of capital; vanity induces us to devote our efforts to artificial satisfactions at the expense of genuine ones, while violence and fraud force us to take onerous precautions in view of the reprisals they provoke, thus entailing a great depletion of our energy.

I will end this preliminary study of man with an observation I have already made with regard to needs. It is that the elements highlighted in this chapter that are included in and make up economic science are essentially variable and various. Needs, desires, material things and powers supplied by nature, muscular strength, organs, intellectual faculties, and moral qualities – all vary depending on the individual, the time, and the place. No two men resemble each other in each one of these aspects nor, for very good reason, in all of them. What is more, no man is perfectly consistent from one hour to the next; what one man knows, another does not, what this man appreciates, that man scorns. In one instance, nature has been prodigal, in another, miserly. A virtue[309] that is difficult to practice at a certain temperature becomes easy in another climate. Economic science, therefore, unlike the so-called exact sciences, does not (have) the advantage of a yardstick, an absolute standard to which it can refer everything, a graduated measure that it can use to calibrate the intensity of desires, efforts, and satisfactions. If we were doomed to work alone, like certain animals, we would all be placed in situations that differed in certain ways, and if these external ways were alike and the environment in which we acted were identical for everyone, we would still differ in our desires, needs, ideas, wisdom, energy, our way of assessing and appreciating things, our ability to plan for the future, and our actions, so that great and inevitable inequality would be seen between men. Of course, total isolation and the absence of any form of relationship between men is just an illusionary vision born in Rousseau’s imagination. But supposing that this anti-social situation known as a state of nature has ever existed, I wonder through what sequence of ideas Rousseau and his followers have managed to locate equality in it? We will see later[310] that, like wealth, like freedom, like fraternity, and like unity, equality is an end and not a starting point. It arises from the natural and regular development of societies. The human race does not move away from it (equality) but moves towards it. This is both more reassuring and truer.

After discussing our needs and the means we have of achieving them, I must say something about our satisfactions. They are the result of the entire (social) mechanism. It is through the greater or lesser number of physical, intellectual, or moral satisfactions enjoyed by the human race that we see whether the machine is working well or badly. This is why the word consumption, adopted by economists, would have a profound meaning if, while retaining its etymological meaning, it was made a synonym of an end or an achievement.[311] Unfortunately, in common parlance and even in scientific language it is perceived to have a materialist and unsubtle meaning, which is doubtless accurate with regard to physical needs but which ceases to be so with regard to needs of a higher order. The cultivation of wheat or the weaving of wool result in consumption. Is this also true for an artist’s works, a poet’s verses, the thoughts of a legal consultant, the teachings of a professor, or the sermons of a priest? Here again we come up against the disadvantages of this fundamental error that made Adam Smith circumscribe political economy within a circle of materiality, and the reader will forgive me for often making use of the word satisfaction as applicable to all our needs and desires and as being the one best suited to the expanded framework that I believed I could give the science.

Economists have often been crticised for concentrating exclusively on the interests of consumers.[312] “You forget the producer," the critics add. But since satisfaction is the goal and the end of all (our) efforts, like some final consumption of (all) economic phenomena, is it not obvious that the touchstone of progress is to be found in it? Man’s well-being is not measured by his efforts but by his satisfactions, and this is also true for men collectively. This is another one of those truths that nobody questions when the issue is man living in isolation, though they are contested constantly as soon as the reference is to society. The phrase so much denounced has no other meaning than this: any economic measure is to be assessed not by the work it generates but by the useful effect that results from it, this effect producing either an increase or a decrease in general well-being.

With regard to needs and desires, we have said that no two men are alike. This is also true of our satisfactions. They are not assessed equally by all, and this boils down to the trite saying: tastes differ. Well, it is the acuteness of desires and the variety of tastes that determine the direction of (our) efforts. Here, the influence of the moral code on industry is obvious. You can imagine a man living in isolation who is a slave to artificial tastes that are childish and immoral. In this case, it is blindingly clear that his limited forces will satisfy depraved desires only at the expense of those that are more intelligent and better understood. Should a comparable allegation refer to society, however, then this obvious axiom is considered to be an error. We are led to believe that artificial tastes and illusory satisfactions, acknowledged sources of individual poverty, are nevertheless a source of national wealth, because they open up markets to a host of industries. If this were true, we would come to a very sorry conclusion, which is that the social state situates man between poverty and immorality. Once again, political economy resolves these apparent contradictions in the most satisfactory and rigorous manner.

 


 

IV. Exchange

Exchange[313] is political economy; it is society in its entirety, for it is impossible to imagine society without exchange or exchange without society.[314] For this reason I do not pretend to cover such a huge subject comprehensively in this chapter. This entire book will will offer no more than an outline of it.

If men, like snails, lived in total isolation from one another, if they did not exchange their work and ideas, if there were no transactions between them, there might be crowds, small groups, and individuals living in proximity, but there would be no society.

What am I saying? There would not even be individuals. For man, isolation is death. Now, if he cannot live outside society, the strict conclusion is that his natural state is the social state.

All learning leads to this truth, so badly understood in the 18th century, which based politics and the moral code on the contrary assertion. At that time, scholars were not content to contrast the state of nature with the social state; they ascribed to the state of nature a clear superiority to the social state. “Happy were those men," Montaigne had said, “who lived with no links, no laws, no language and no religion!”[315] We know that Rousseau, who exercised and still exercises such great influence on opinions and on facts, advanced a theory entirely based on the hypothesis that there was a time when men, to their great misfortune, agreed to abandon the innocent state of nature for the stormy state of society.[316]

It is not germane to this chapter to bring together all the refutations that can be made against this fundamental error, the most disastrous that has ever infected political sciences, for if society is a matter of invention and convention, it follows that each person can invent a new form of society, and indeed since Rousseau this has been the turn taken by men’s minds. I believe that it would be easy for me to show that isolation excludes language, just as the absence of language excludes thought, and of course man without thought, far from being natural man, is not a man at all.

However, a peremptory refutation of the idea on which Rousseau’s doctrine is based will, without our seeking it, arise directly from a few considerations on exchange.

Need, effort, satisfaction, these are what constitute man from the point of view of economics.[317]

We have seen that the first and third words cannot be precisely pinned down, for they take place in our sensations and feelings, indeed sensations and feelings are what they are, namely the most personal thing in the world, both with respect to the feeling that precedes and produces effort and to the feeling that follows and rewards it.

It is therefore effort that is exchanged, and this has to be so, since exchange implies activity (or action)[318] and effort alone reveals our acting nature. We cannot suffer or enjoy for one another even though we are sensitive to the pleasures and pains of others. However, we can help each other, work for each other, render each other reciprocal services,[319] place our capacities or what results from them at the service of others subject to payment in return. That is what society is. The causes, effects and laws governing these exchanges make up political and social economy.

Not only can we do this, but also of necessity we do act in this way. What I state is this: our nature is such that we are obliged to work for one another under pain of death and (even) immediate death. If this is so, society is our “state of nature” since it is the only one in which we are given to live.

Indeed, a comment has to be made about the equilibrium (which exists) between our needs and our capacities, a comment that has always made me admire the providential plan that rules our destiny.

In (a state of) isolation, our needs surpass our capacities.[320]

In a social state, our capacities surpass our needs.[321]

It follows from this that man cannot live in isolation, whereas when man lives in society, the most pressing needs give way to desires of a higher order and this continues progressively in a process of perfectibility whose limits nobody can define.

This is not mere oratory, but a statement that can be rigorously demonstrated through a process of reasoning, and by analogy if not by experience. And why can it not be demonstrated by experience or by direct observation? Precisely because it is true and precisely because, since man cannot live in isolation, it becomes impossible to show the effects of absolute solitude on a living human being. The senses cannot perceive a negative statement. You may be able to prove to my mind that a triangle never has four sides, but you cannot support such a possibility by showing me physically a triangle that is a tetragon. If you did this, your assertion would be destroyed by the very thing you are showing me. In the same way, asking me for experimental proof or requiring me to study the consequences of isolation on a living human being would be to impose a contradiction on me since, isolation and human life being mutually exclusive, we have never seen nor will we ever see men with no relationships.

If, and I do not know this, there are any animals destined by their nature to spend the entire span of their life in absolute isolation, it is very clear that nature must have established a precise equivalence between their needs and their capacities. We might even suppose their capacities greater, in which case, these animals would be capable of perfectibility and progress. But perfect equilibrium turns them into unchanging beings and the thought that they might have a greater number of needs than their faculties could provide, is inconceivable. The creatures would need, right from birth, from their first appearance as living creatures, to have capacities fixed relative to the needs they have to satisfy, or at least their capacities and needs would have to develop in a parallel proportion. Without this these species would die at birth, and would consequently not be available to be observed.

Of all the species of living creatures that surround us, it is undeniable that none is subject to as many needs as man. In none of them is childhood so feeble, long, or dependent, maturity so burdened with responsibilities, or old age so weak and full of suffering. And as if man did not have enough needs, he still has tastes whose satisfaction demands as much from his capacities as his needs themselves do. Scarcely has he found a way of satisfying his hunger than he wants to please his palate, scarcely has he clothed himself than he wants to adorn himself too, and scarcely has he found himself a shelter than he seeks to embellish his home. His mind is no less restless than his body is needy. He wants to go deeper into the secrets of nature, tame animals, conquer the elements, penetrate into the bowels of the earth, cross vast seas, glide above the winds, and overcome time and space. He wants to grasp the driving forces, the springs,[322] and the laws that govern his heart and will, to control his passions, conquer immortality, and merge his being with that of his Creator, to subjugate everything – nature, his fellow-men, and himself – to his control: in a word, his desires expand endlessly toward infinity.

Thus, in no other species are faculties subject to development as great as in man. He alone is able to compare and judge, he alone reasons and speaks, he alone plans for the future, he alone sacrifices the present to the future, he alone transmits the achievements, thoughts, and treasures of his experience from generation to generation; in a word, he alone is capable of perfecting himself step by step like countless links in a chain which appears to reach even beyond this world.

Let us insert an economic observation at this point. However extended the field of our capacities, they can never raise us to the ability to create. It is not within man’s power in fact to increase or decrease the number of molecules that exist. His action is limited to subjecting the matter around him to modifications and combinations that make them suitable for his use (J. B. Say).[323]

Modifying matter in order to increase its usefulness to us is to produce, or rather one way of producing. I conclude from this that value, as we shall see later,[324] can never lie in these things themselves but rather in the effort devoted to modifying them, which, when exchange takes place, is compared with other similar efforts. For this reason, value is just an appraisal of the (worth of the) services being exchanged, whether matter enters into it or not. It is totally irrelevant, as far as value is concerned, whether I am providing my fellow man with a direct service, for example by operating on him surgically, or a service that is indirect, by preparing some medicine for him. In this latter case, utility lies in the substance while value lies in the service (provided), in the intellectual and physical effort expended by one man for the benefit of another. It is by pure metonymy that value is attributed to the matter itself and on this occasion, as on many others, metaphor has caused science to be lead astray.

Let us return to the nature of man. If you stopped at the notions above, he would differ from other animals only by the greater extent of his needs and the superiority of his capacities.[325] All creatures in fact are subject to needs and provided with capacities. Birds undertake long journeys to seek out temperatures that suit them, beavers cross rivers on the bridge they build, sparrow hawks pursue their prey openly, cats lie in wait patiently for theirs, spiders make traps for what they eat, and all work in order to live and develop.

However, while nature has set a precise ratio between animals’ needs and their capacities, it has treated man with more grandeur and munificence in order to oblige him to be sociable and has decreed that in isolation his needs would surpass his capacities, while on the contrary, when living in society his capacities surpass his needs. This opens out a limitless field to the enjoyment of more noble things, and we have to acknowledge that, just as in his relationships with his Creator, man is raised above animals by religious sentiment, by his relationships of justice with his fellow man, by his relationship with himself governed by moral principles, and even through his means of living and developing. So he distinguishes himself from animals through a remarkable phenomenon. This phenomenon is Exchange.

Will I attempt to paint a state of poverty, penury, and ignorance in which, without the ability to exchange, the human race would have stagnated forever, if it had not even disappeared from the face of the earth?

In a novel with a matchless capacity for charming children from one generation to the next,[326] one of the most popular sages has shown man overcoming the difficulties of absolute solitude by his sheer energy, industriousness, and intelligence. Wishing to cast light on all the resources possessed by this noble creature, he portrayed him, so to speak, as a being accidentally cut off from civilization. A part of Daniel Defoe’s plan was thus to cast Robinson Crusoe on the Island of Despair alone, naked, and deprived of everything that adds to human powers: collaborative efforts, the division of labor, exchange, and (even) society itself.[327]

However, and while the obstacles are no more than a diversion for the imagination, Daniel Defoe would have removed from his novel every vestige of verisimilitude if he had been too faithful to the notion that he wanted to develop and had not made obligatory concessions to the social state by accepting that his hero had saved from the shipwreck a few essential objects, provisions, gunpowder, a gun, an axe, a knife, ropes, planks, iron, etc., a clear proof that society is the necessary milieu for man, since even a novelist is unable to have his character live outside it.

And note that Robinson Crusoe carried with him into solitude another social treasure a thousand times more precious and that the waves were unable to swallow up, I mean his ideas, his memories, his experience, even his language, without which he would not have been able to talk to himself, that is to say, think.

We have the sorry and unreasonable habit of attributing to society the sufferings we witness. We are right to do this up to a certain point if we mean to compare society with itself, taking two different stages of its progress and advancement, but we are wrong if we compare the social state, even if it is imperfect, with a state of isolation. In order to be able to argue that society worsens the situation, I will not say of man in general but of a few men and the most destitute of them, you would have to start by proving that the most deprived of our brethren would have, in society, to bear a heavier burden of deprivation and suffering than would have been his lot in solitude. Well, take a look at the life of the humblest of manual workers. Review in the greatest detail the things he consumes daily. He is covered with a few rough garments, he eats a bit of black bread, he sleeps under a roof and on planks at least. Now ask yourself if this man living in isolation, deprived of the resources of exchange, would have the slightest opportunity of obtaining these rough garments, this black bread, this hard bed, and this humble abode for himself. The most passionate supporter of the state of nature, Rousseau himself, admitted that this was radically impossible. People did without everything, he says, they went about naked and slept in the open air. Thus in order to exalt the state of nature, Rousseau was led to have happiness consist in deprivation. But once again I state that this negative form of happiness is an illusion, and that man living in isolation would be certain to die in a very short time. Perhaps Rousseau would have gone so far as to say that in this lies perfection. He would have been consistent in this, for if happiness lies in deprivation, perfection is in oblivion or death.

I hope that the reader will not conclude from this that we are insensitive to the social sufferings of our brethren. The fact that these sufferings are less in an imperfect society than in isolation does not mean that we do not hope with all our hearts for the progress that will constantly decrease them. But while isolation is worse than the worst that exists in the social state, I was right to say that it puts our needs, even if we limit these to the most pressing ones, totally beyond our capacities.

How does exchange, by overturning this order to our advantage, make our capacities greater than our needs?

First of all, this fact is proved by civilization itself. If our needs exceeded our capacities we would be irrevocably backward, and if our needs and capacities were in equilibrium we would be irrevocably static. We are making progress, therefore each stage of social life compared with one that went before, for a given number of satisfactions, liberates some part of our capacities.

Let us try to give an explanation for this marvelous phenomenon.

The one we owe to Condillac[328] appears totally inadequate and empirical to me, or rather it explains nothing. “The very fact that an exchange takes place,” he says, “means that there has of necessity to be a profit for the two contracting parties, without which it would not happen. Therefore, every exchange comprises two gains for the human race.”[329]

Taking this proposition to be true, the only thing you can observe is the statement of a fact.[330] This was how the “Imaginary Invalid”[331] explained the narcotic property of opium:

Quia est in eo

Virtus dormitiva

Quae facit dormire[332].

An exchange comprises two gains, you say. The question is to ascertain why and how. – This results from the very fact that it takes place. – But why has it taken place? What motivated the men concerned to make it? Is it that exchange in itself has a mysterious and necessarily beneficial virtue that defies any explanation?

Others derive the advantage from the giving of something of which you have too much in order to receive something you lack. Exchange, or trade, they say, is the barter of something superfluous for something necessary. Apart from the fact that this is contrary to the facts that we observe – for who would dare to say that a farmer, by divesting himself of the wheat he has grown and will never eat, is handing over something superfluous?[333] – I can readily see in this axiom how two men would come to an agreement by chance, but I cannot see how this explains progress.

Observation will provide us with a more satisfactory explanation of the power of exchange.

Exchange is manifested in two ways: the joint use of our strength and the division of labor.

It is very clear that in a great many cases the combined strength of several men are completely superior to the sum of their strength in isolation. Take moving a heavy burden. Where a thousand men in succession will fail, it is quite possible that four men will succeed by joining forces. Try to imagine the things that would never have been accomplished if this co-operation had not taken place!

What is more, this combination of muscular strength to achieve a common goal is small change; nature has endowed us with a wide variety of physical, moral, and intellectual capacities. There are countless ways in which cooperation in the use of these faculties may be used. Does a useful task need to be accomplished, such as the building of a road or the defense of the country? One man puts his strength at the service of the community, another his agility, a third his daring, a fourth his experience, foresightedness, imagination, and even his reputation. It is easy to understand that these same men acting in isolation would not be able to achieve nor even conceive of the same result.

Well, the joining of men's forces involves (an) exchange. In order for men to agree to cooperate, they have to have in mind a share of the satisfaction to be obtained. Each of them uses his efforts for the benefit of someone else and benefits from the efforts of someone else in the proportions agreed, and this constitutes exchange.

We can see here how exchange in this form increases our satisfactions. Efforts that are equal in intensity result, by the sole fact of their combination, in greater success. In this there is no trace of the alleged barter of something superfluous for something necessary any more than the double and observed profit claimed by Condillac.[334]

We will make the same comment about the division of labor. After all, if you look closely, sharing occupations around is for men just another way, one that is more permanent, of combining their various strengths, cooperating, and associating with each other, and it is quite right to say, as will be shown later,[335] that the current organization of society, provided that it acknowledges free exchange,[336] is the finest and most extensive of all associations, one marvelous in a different way from those dreamt of by socialists, since it operates through a wonderful mechanism that does not conflict with individual independence. Each person enters and leaves it at any time, as it suits him. He contributes what he wishes; and withdraws from it comparatively higher and always progressively greater satisfaction, such satisfaction which is determined, in accordance with the laws of justice, by the very nature of things,[337] and not by the arbitrary will of a leader. But this point of view anticipates things here. All I have to do for the moment is to explain how the division of labor increases our powers.

Without spending a great deal of time on the subject, given that the number of those who do not raise some objections is small, I think it is quite germane for me to say something about it. Perhaps it has been to some extent given insufficient emphasis. To prove the power of the division of labor, people concentrated on pointing out the wonders it achieves in certain factories, those manufacturing pins, for example.[338] [339] The question may be raised to a more general and philosophical point of view. On top of this, force of habit has this strange ability to make us lose sight of, to fail to notice, the phenomena all around us. There is no statement more profoundly true than Rousseau’s: “A great deal of philosophy is needed to observe what we see every day.”[340] It is therefore not superfluous to remind men of the things that, without noticing it, they owe to exchange.[341]

How has the ability to exchange things raised the human race to the level at which we see it today? Through its influence on labor, on the contribution made by natural resources, on the capacities of man, and on capital.

Adam Smith demonstrated this influence on labor extremely well.

Trans. from Fr: “The increase in the quantity of labor that the same number of men are able to do following a division of that labor is due to three circumstances," said this famous economist, “First, to the degree of skill that each worker now attains; secondly to the saving of time naturally lost by men moving from one type of occupation to another; thirdly to the fact that each person has more opportunity of finding an easy and fast way of achieving a goal when this goal is the center of his attention, than when that attention is spread over an infinite variety of things.”

Original: "This great increase of the quantity of work, which, in consequence of the division of labour, the same number of people are capable of performing, is owing to three different circumstances: first, to the increase of dexterity in every particular workman; secondly, to the saving of the time which is commonly lost in passing from one species of work to another; and last, to the invention of a great number of machines which facilitate and abridge labour, and enable one man to do the work of many."[342]

Those who, like Adam Smith, see in labor the sole source of wealth, limit themselves to seeking how it advances by being divided. However, in the preceding chapter we have seen that it is not the sole factor (contributing to) our satisfactions. The forces of nature contribute. This is undeniable.

Thus, in farming, the action of the sun and rain, the life (giving properties) in the soil, and the gases in the atmosphere are certainly factors that contribute to the work done by human beings in growing crops.

Manufacturing owes a similar debt to the chemical qualities of certain substances, to water-power, to the expansion of steam, to gravity, or electricity.

Exchange has been able to turn to man’s benefit the strength and instincts of certain species of animals, the force of the wind that swells the sails of its ships, the laws of magnetism that, by acting on the compass, direct their passage across the huge expanse of the seas.

There are two truths beyond contradiction. The first is that man is provided with more of everything when he makes the best use of the forces of nature.

It is palpably clear in effect that we obtain more wheat for the same effort from good, well fertilized earth than from arid sand or sterile rocks.

The second is that natural resources are distributed unequally around the world.

Who would dare to claim that all types of earth are equally suited to growing the same types of crops and all regions suited to the same type of manufacture?

Well, if it is true that the forces of nature differ at various places in the world, and if on the other hand men are richer where they are able to obtain the most assistance (from nature), it follows that the ability to exchange increases immeasurably the useful contribution made by these forces.

Here we are faced with gratuitous utility and onerous utility, where the former takes the place of the latter, as as result of exchange. Indeed, it is not clear that if men were deprived of the ability to exchange and were reduced to producing ice at the equator and sugar at the poles, they would have great trouble in producing what the heat and cold are now doing for them free of charge, and that from their point of view a huge proportion of the forces of nature would remain inert? Thanks to exchange, these forces are used wherever they are found. Land suitable for wheat is sown with wheat, land suitable for growing grapes is planted with vines. There are fishermen on the coasts and lumberjacks in the mountains. Here, water and there, wind are directed onto wheels that take the place of ten men. Nature becomes a slave that does not need to be fed or clothed, whom we do not pay nor have paid for its services, that costs nothing either to our wallets or our consciences.[343] The same sum of human effort, that is to say the same services or the same value, creates an ever greater total sum of utility. For each given result, just a portion of human activity is taken up; the rest is made available through the intervention of the forces of nature, and takes on new obstacles, satisfies new desires, and creates new forms of utility.

The effects of exchange on our intellectual capacities are such that the most vivid imagination cannot calculate their range.

“The things we know," says Mr. de Tracy,[344] “constitute our most precious acquisitions, since they are the ones that direct the way our powers are used and make them most effective the more healthy and generous they are. Now, no man is able to see everything and it is much easier to learn than to invent. But when several people communicate with each other, what one man has observed is rapidly known by all the others, and it is enough for one who is extremely ingenious to exist among them for invaluable discoveries to become instantly the property of all. Enlightenment ought thus to increase much faster than in a state of isolation, apart from the fact that it can be preserved and consequently be added to in each succeeding generation.”[345]

If nature has varied the resources surrounding mankind and that it places at our disposal, it has not been any more uniform when allocating human capacities. We are not all endowed to the same extent with vigor, courage, intelligence, patience, artistic ability, literary ability, or industrial skill. Without our ability to exchange, far from acting to the advantage of our well-being, this diversity would add to our poverty, with each person less aware of the benefits of the capacities he had than of the lack of those he did not have. Thanks to exchange, a strong person can do without genius up to a certain point, and an intelligent being without physical strength, for each person would receive the benefit of the distinctive qualities of his fellow-men through the admirable community[346] that it establishes between men.

In order to satisfy his needs and tastes, it is not enough in most cases for someone to work or exercise his capacities on or through the resources of nature. He still needs tools, instruments, machines, and provisions, in a word, capital. Let us imagine a small population made up of ten families,[347] each of which, working exclusively for itself, has to carry out ten distinct activities. Each head of the family would need ten sets of equipment. The population would own ten ploughs, ten yoke of oxen, ten forges, ten carpentry and joinery workshops, ten weaving looms, etc. When (we have) exchange, one single plough, one single yoke of oxen, one single forge, and one single weaving loom would be enough. No imagination could calculate the saving of capital that results (from this).

The reader can now see what constitutes the true power of exchange. It does not imply, as Condillac says, (that there are) two gains, because each of the contracting parties places a higher value on what it receives than what it gives.[348] Nor is it that each of them is handing over something superfluous in order to acquire something he needs. It is quite simply that when one man says to another: “Just do this and I will just do that and we will share,”[349] better use is being made of labor, men’s capacities, natural resources, and capital, and as a result, there is more to share. This is even more true if three, ten, one hundred, one thousand, or several million men join the association.

The two propositions I have put forward are thus strictly true and these are:

In isolation, our needs are greater than our capacities.

In the social state, our capacities are greater than our needs.

The first is true, given that the entire area of France would be unable to provide food for one man in a state of total isolation.

The second is true, as revealed in the fact that the population in this same area is increasing in number and well-being.

Progress in Exchange.

The primitive form of exchange is barter. Two people, each of whom has something he desires and who possesses the object able to satisfy the desire of the other, exchange these objects with each other in a reciprocal manner, or else they agree to work separately at something and share the total product in agreed proportions. This is barter, which, as the socialists might say, is exchange, buying and selling, and (therefore) an embryonic form of commerce. We note here (the) two desires (which are) the driving forces, the two efforts (which are the) means, and the two satisfactions (which are the) consummation of the entire process.[350] Nothing makes this process fundamentally any different when carried out in isolation, except that while the desires and satisfactions have remained, by their natures, incapable of being transferred, efforts, and only (the) efforts, have been exchanged; in other words, two people have worked for each other and rendered a mutual service to each other.[351]

Thus, this is the point at which political economy truly starts, for it is at this point that we can see the first appearance of value. Barter is carried out only when an agreement has been reached or a negotiation has taken place; each of the contracting parties makes up his mind in the light of his self interest and each one of them makes a calculation that goes as follows: “I will engage in barter if the barter achieves the satisfaction of my desire for less effort.” It is certainly a marvelous thing that less effort is able to meet desires and satisfactions that remain at the same level, and this is explained by the considerations that I set out in the first paragraph of this chapter. When two products or services are bartered, it can be said that they are of equal value. Later we will have to go into the notion of value more deeply. For the moment this more vague definition will suffice.[352]

A circular or round-about form of barter can be envisaged; an operation that includes three contracting parties. Paul provides a service to Pierre, who provides an equivalent service to Jacques who, in turn, provides an equivalent service to Paul, at the end of which everything is balanced. I have no need to say that this rotation is carried out only because it suits all of the parties, without changing either the nature or the results of the barter.

The essence of barter would be found in all its purity even if the number of contracting parties were greater. In my commune (of Mugron),[353] the wine producer pays for the services of the blacksmith, barber, tailor, verger, parish priest, and grocer with wine. The blacksmith, barber, and tailor also deliver to the grocer the wine they have received from the wine producer in exchange for goods consumed right through the year.

It cannot be repeated too often that this roundabout form of barter does not change the basic notions set out in the preceding chapters in the slightest. When the process is completed, each person who cooperated in it showed these three things: desire,[354] effort, and satisfaction.[355] The only things which have been added are the exchange of effort, the transfer of services, and the division of labour, with all the benefits that result from this. Each person who took part contributed to (the creation of these) benefits, since they could have continued working in isolation, which is always the option of last resort, but chose not to in view of the greater benefits gained (by cooperating with each other).

It is easy to understand that roundabout barter and trading in kind, cannot be extended very far and I have no need to stress the obstacles to it. For example, how would someone who wished to give up his house in exchange for the products he will need to consume throughout the year go about it? In any case, barter cannot go outside the narrow circle of people who know one another. The human race would rapidly have reached the limits of the division of labor and progress if it had not found a way of making exchange easier.

This is why, from the very beginnings of society, we find men bringing intermediary products into their transactions: wheat, wine, animals, and nearly always some form of (precious) metal. These goods fulfill this function more or less satisfactorily but none of them is rejected in essence, provided that effort is represented in this context by value, since it is value that is needed to carry out the transaction.

Along with recourse to this intermediary form of goods, two economic phenomena known as sale and purchase make their appearance. It is clear that the notion of sale and purchase is not subsumed in simple barter or even in round-about barter. When one man gives another something to drink in order to receive something to eat from him, there is just one action that cannot be broken down. Well, what should be clearly noted at the outset of our study of political economy is that an exchange made using an intermediary does not lose any characteristic of the nature, essence, or quality of barter; it is just a compound or indirect form of barter.[356] According to the extremely judicious and profound observation made by J. B. Say, it is a barter with two factors,[357] one known as sale and the other purchase, factors whose combination is essential if a complete (act of) bartering is to be accomplished.

Indeed, the appearance in the world of a convenient method of bartering changes neither the nature of men nor that of objects. For everyone, it is always need that determines effort, and satisfaction that rewards it. Exchange is complete only when one man, who has made an effort for the benefit of another, has received an equivalent service from him, that is to say, satisfaction. To do this, he sells his service in return for the intermediate form of goods, and then, with this intermediate product, he purchases equivalent services, at which point the two factors reconstitute a simple form of barter for him.

Let us take a doctor,[358] for example. For several years, he applies his time and capacities to the study of diseases and remedies. He has visited patients, given advice, in a word, he has provided services. Instead of receiving direct services in return from his patients, which would constitute a simple form of barter, he has received an intermediate form of goods, precious metals with which he has procured the satisfactions that in the end constituted the object he had in view. It is not his patients that have supplied him with bread, wine, or furniture, but they have given him the value of these things. They were able to give him écus[359] only because they themselves had provided services. There is thus a balance of services, from their point of view and also a balance from the point of view of the doctor, and if it were possible to follow mentally this circulation to its end, we would see that exchange through the intervention of money is reduced to a host of simple barters.

Under (a system of) simple barter, value lies in appraisal of the worth of the two services (which are) exchanged and compared directly with each other. Under compound (or indirect) exchange, the worth of the two services are still compared with each other, but via this third medium, this intermediate form of goods (which) is known as money. We will see elsewhere what difficulties and errors arise from this (added) complication.[360] It is sufficient to note here that the presence of this intermediate good does not change the notion of value in any way.

The reader, once he accepts that exchange is simultaneously the cause and effect of the division of labor, once he accepts that the latter increases the number of satisfactions in proportion to efforts, for the reasons set out at the start of this chapter, will easily understand the services rendered to the human race by money, simply through its facilitating exchange. Thanks to money, exchange has been able to develop indefinitely. Each person throws his services into the ring of society without knowing for whom they will provide the satisfaction attached to them. In the same way, he draws from society, not direct services, but écus, with which he will finally purchase services where, when, and how it suits him. So that the final transactions are carried out through time and space between people who do not know each other and without anyone knowing, at least in the majority of cases, by whose effort his needs will be satisfied and for whose desires his own efforts will provide satisfaction. Exchange based on money is made up of countless barters whose contracting parties do not know one another.

However, exchange is such a great benefit to society (and is it not exchange, society itself?) that for purposes of facilitating and increasing exchange, society has not been confined to the introduction of money. In logical order, after need and satisfaction united in the same person through isolated effort, after simple barter, after barter with two factors or compound exchange made up of sale and purchase, there is yet another form of transaction (which is) extended through time and space by means of credit, mortgage titles, letters of exchange, bank notes, etc. Thanks to these marvelous mechanisms, born of civilization, which advance it and are themselves advanced by it, an effort undertaken today in Paris will go to satisfy an unknown person beyond the seas and across the centuries, and he who carries it out receives his compensation now, (since) there are people who make loans to cover this payment and are prepared to subject themselves to asking for their payment in far-off countries or to waiting for it in the remote future. This complication, as astonishing as it is marvelous, when analyzed in detail, in the end shows us the unity of the economic phenomena of “need, effort and satisfaction," taking place within each individual according to the law of justice.

The Limits to Exchange

The general characteristic of all exchange is that it decreases the ratio of effort to satisfaction. Between our needs and satisfactions there are obstacles that we succeed in reducing by the joint use of our strength or the division of labor, that is to say through exchange. However, exchange itself encounters obstacles and requires effort. The proof of this lies in the immense amount of human labor it generates. Precious metals, roads, canals, railways, carriages, or ships: all these things absorb a considerable amount of human activity. What is more, look at the number of men whose sole occupation lies in facilitating exchange, how many bankers, traders, merchants, brokers, coachmen, or sailors there are! This huge and costly apparatus[361] is better proof than all forms of reasoning of the power that lies in our ability to exchange. Without it this why would the human race have agreed to impose such an apparatus on itself?

Since it is in the nature of exchange both to save on efforts and to demand (more of) them, it is easy to understand what its natural limits are. Because of the force that impels man always to choose the lesser of two evils, exchange will expand as long as the effort required by it is less than the effort he saves. And exchange will stop naturally when, in the end, the sum of satisfactions obtained by the division of labour is less, because of the difficulties of (further) exchange, than if they were got by direct production.

Take the case of a small group of people. If it wants to get satisfaction for itself it has to make an effort. It can go to another group and say to it: “Make this effort for us and we will make another for you.” This stipulation may suit everyone if, for example the second group, because of its situation, is in a position to bring to the undertaking a greater proportion of natural and freely available resources. In this case, it will achieve the result using an effort equal to, let us say, 8, where the first group would only be able to do this with an effort of 12. With the undertaking needing only 8, there is a saving of 4 for the first group. However, there is then the transport and payment for the middlemen,[362] in a word, the effort required by the apparatus of exchange.[363] This obviously has to be added to the figure of 8. The exchange will continue to be carried out as long as the exchange itself does not cost 4. As soon as this figure is reached, it will stop. It is not necessary to pass laws on this, for either the law will intervene before this equalization is reached, in which case it is harmful, since it prevents an economizing of effort, or it will arrive after this, in which case it is unnecessary. It would be like a decree that forbade lamps to be lit at mid-day.[364]

When exchange is stopped in this way because it is no longer advantageous, the least advance in the apparatus of commerce will give it fresh impetus. Between Orléans and Angoulême[365] there are a certain number of transactions. These two towns exchange services every time that they obtain more satisfaction by doing this than by direct production. They stop doing so when production through exchange, increased by the cost of the exchange itself, exceeds or reaches the level of effort (required by) direct production. In these circumstances, if the apparatus of exchange is improved or merchants lower the cost of their business, if a tunnel is driven through a mountain or a bridge built over a river, if a road is paved or an obstacle removed, exchange will increase because men want to take advantage of all the benefits we have already acknowledged it has, and because they want to receive any gratuitous utility (that might exist).[366] Improvements made to the apparatus of exchange are thus equivalent to moving the two towns closer together. From which it follows that bringing men closer together physically is equivalent to an improvement in the apparatus of commerce. And this is very important; (as) it is the solution to the problem of population. It is the fact overlooked by Malthus.[367] Where Malthus saw disharmony, this fact will enable us to see harmony.

When men make exchanges, they use this as a way to obtain the same (amount of) satisfaction for less effort, and the reason for this is that both sides render each other services that are a vehicle for acquiring a greater proportion of gratuitous utility.

Now, they will make even more exchanges to the extent that they encounter fewer obstacles and require less effort.

And exchanges will encounter fewer obstacles and require less effort as men are increasingly drawn (closer) together. A higher density of population is thus necessarily accompanied by a greater (amount) of gratuitous utility. It gives more power to the apparatus of exchange and makes available a (greater) proportion of human effort; (thus), it is a cause of progress.[368]

And, if you wish, let us leave the realm of generality and examine the facts:

Is a street of a given equal length not of more use in Paris than in a deserted town? Is a one kilometer long railway line not of more use in the Department of the Seine than in the Department of Les Landes?[369] Is not a merchant in London able to content himself with a lower return on each transaction he makes because of their greater number? In every such example, we we will see that there two apparatuses of exchange that, although they are identical, provide very different services depending on whether they operate in an area with a dense or a sparse population.

The density of the population not only enables better use to be made of the apparatus of exchange, it also enables this apparatus to grow and be improved (upon). That such a beneficial improvement can be achieved in an area with a dense population is explained because this will enable it to save more effort than it requires, something which it cannot achieve in an area which is sparsely populated because it would require more effort than it could save.

When you leave Paris for a short while to live in a small provincial town you are surprised to find how often you cannot obtain certain services unless you pay (the) high(er) costs (involved), spend a great deal of time, and overcome a thousand obstacles.

It is not only the physical side of the apparatus of commerce that is used and improved by the sole fact of the density of the population, but also the moral side. People living close together are more capable of participating in the division of labour, joining forces, and forming associations to found schools and museums, building churches, providing for their security, establishing banks or insurance companies, in a word, getting for themselves certain common benefits with considerably less expenditure of effort by each individual.

But we will return to these matters when we come to the question of population.[370] Let us limit ourselves to the following comment:

Exchange is a means given to man to make better use of his faculties, to economise on his use of capital, to achieve a greater input from the gratuitous resources of nature, to increase the proportion of gratuitous utility to onerous utility, and consequently to reduce the ratio of effort to result. (He will thus) have at his discretion more of his powers, after attending to his most pressing and urgent needs in their order of priority, to devote to pursuing enjoyments of an increasingly higher order.[371]

While exchange saves effort, it also demands it. It extends, increases, and multiplies up to the point at which the effort it requires equals the effort it saves, and stops at this point until there are improvements to the commercial apparatus, or merely because the population becomes more dense and men live closer together, making the conditions right for it to resume its upward progress. From this it follows that laws that limit exchange are always harmful or unnecessary.

As they are always ready to think that nothing good happens without them, governments refuse to understand this law of harmony:

Exchange develops naturally up to the point at which its cost outweighs its usefulness and it stops naturally at this limit.

Consequently governments can be seen everywhere spending a lot of time encouraging or restricting it (exchange).

To take exchange beyond its natural limits, they go out to conquer markets and colonies.[372] To keep it within these limits, they dream up all sorts of restrictions and impediments.

This intervention of force in human transactions is followed by countless harms.

The increase in (the size of) this force is itself already an initial harm, for it is perfectly clear that the state cannot make conquests, keep distant countries under its domination, and divert the natural course of trade through the activities of the Customs Service, without greatly increasing the number of its agents.[373]

This diversion of the coercive power of the state (from its proper purpose) is an evil even greater than its increase. The rational purpose of government is to protect all forms of freedom and property and here we find it, applied to violating the freedom and property of its citizens.[374] When they act like this governments seem bent on removing from people’s minds any principled notions at all. As soon as it is accepted that oppression and plunder are legitimate because they are legal,[375] provided that they are carried out on the citizens only through the intermediary of the law and the (coercive power of) the state, gradually we begin to see each class stepping forward to demand that all the other classes be sacrificed to it.

Whether the intervention of this coercive power in exchanges stimulates some exchanges that would never have been made,[376] or prevents some that would have been made, it cannot fail to cause the simultaneous loss or displacement of labor and capital,[377] and consequently a disturbance[378] in the way that populations are naturally distributed. Natural interests disappear at one place, artificial interests are created at another, and people are forced to follow the flow of these (opposing) interests.[379] This is the reason why we see huge industries established in places where they should never be, (such as) France making sugar and England spinning cotton imported from the plains of India. Centuries of wars have been necessary, rivers of blood spilt, and huge (amounts of) treasure wasted to achieve the result of substituting unsound industries for sound ones in Europe, thus creating opportunities for crises, unemployment, and instability, and finally pauperism.

But I see that I am getting ahead of myself. First of all, we have to ascertain the laws governing the free and natural development of human societies. Later, we will have to study (these) disturbances to them.[380]

The Moral Force of Exchange

At the risk of upsetting modern sentimentality, it has to be repeated that political economy covers the area known as business and that business is carried out under the influence of self-interest. It is useless for socialist puritans to cry: “It is dreadful, we will change all this!,” (as) their eloquence on this (topic) gives the lie to it constantly. Just try to buy one of their pamphlets at a bookshop on the Quai Voltaire using “fraternity” as payment![381]

It would be falling into ranting of another type to attribute morality to acts that are determined and governed by self-interest. Certainly the ingenuity of nature may have organized (the) social order so that these (very) same acts, lacking any morality in their driving force, nevertheless produce moral results. Is this not true of labor? Well, I argue that exchange, whether at the level of simple barter or when it has become a vast (system) of commerce, develops tendencies in society that are more noble than (those in) its driving force.[382]

God forbid that I should wish to attribute to a single force all that constitutes the grandeur, glory, and appeal of our destiny. Just as there are two types of force in the physical world, a centripetal force and a centrifugal force, there are also two principles which are active in the social world: private, self-interest and feeling or sympathy for others.[383] Who is so unfortunate as not to recognize the benefits and joys of the principle of having sympathy for others, shown by friendship, love, filial piety, paternal tenderness, charity, love of one’s country, religious sentiment, and enthusiasm for what is good and beautiful? There are some who say that the inclination to fellow-feeling is just a grandiose form of individualism, and that loving others is just basically an intelligent way of loving yourself. This is not the place to go into this question.[384] Whether our two instinctive impulses are distinct or related, all we need to know is that, far from conflicting with each other, as is constantly being claimed, they combine together and contribute to achieving the same result, namely, the general good.

I have established the following two propositions:

In isolation, our needs are greater than our capacities.

Through exchange, our capacities are greater than our needs.

They explain why society exists. Here are two others that guarantee its unlimited progress (towards perfection):

In a state of isolation, the prosperity of one man harms that of others.

By exchanging with one another, the prosperity of one helps others to prosper.[385]

Is there any need to prove that if nature had intended man to live a solitary existence, the prosperity of one would be an obstacle to the prosperity of another? The greater they were in number, the fewer opportunities of well-being they would have. In any case, we can see clearly how their (greater) number would cause them harm but (we) do not understand how their (greater) number might benefit them. And then, I ask you, how would the principle of fellow-feeling reveal itself? When would it arise? Would we even be able to imagine it?

However, men exchange things. As we have seen, exchange implies a division of labor. It gives rise to professions and trades. Each person concentrates on overcoming one type of obstacle for the benefit of the community. Each person devotes himself to providing it with one type of service. Well, a full analysis of (the nature of) value shows that each service has a value first of all because of its intrinsic utility, and then because it is provided in a wealthier environment, that is to say, within a community that is more inclined to demand it and more capable of paying for it. By showing us artisans, doctors, lawyers, traders, coachmen, and teachers who know how to earn themselves a greater reward for their services in (big cities like) Paris, London, and New York than in the (sparsely populated) heath lands of Gascony,[386] the mountains of Wales, or the prairies of the Far West (of America), does experience not confirm for us this truth that men have all the more opportunities of prospering themselves, the more prosperous their surroundings (are)?

Of all the harmonies about which I have written,[387] this is certainly the most important, the finest, the most decisive, and the most fruitful. It implies and encompasses all the others. For this reason, I can provide only a very inadequate vindication of it here. It will be fortunate if it emanates from the spirit of this book. It will also be fortunate if it emerges at least with a sufficient degree of likelihood to persuade the reader to achieve certainty (about this) through his own efforts.

For there should be no doubt that this is the reason for deciding between a natural form of organization and the artificial ones. It is here and only here that the social question lies. If the prosperity of all is the condition for the prosperity of each person, we can rely not only on the economic power of free trade, but also on its moral force. It will be enough for men to understand where their true interests lie for (trade) restrictions, industrial jealousy, trade wars, and monopoly to fall under the protests of public opinion; it will be enough for people to ask, not “What will I get out of this?” but “What will the community get out of this?” before demanding this or that measure from the government. I admit that the second of these questions is sometimes asked through the principle of fellow-feeling, but just let light be shed on it, and it will also be asked out of self-interest. At this point it would be true to say that the twin driving forces of our nature contribute to the same result, namely the general good, and it would be impossible to deny the moral power which self-interest has, in both giving rise to (many) transactions, as well as the effects these transactions produce.

Whether we consider relations in terms of man to man, family to family, province to province, nation to nation, hemisphere to hemisphere, capitalist to worker, or (factory) owner to proletarian, I think it obvious that the social question cannot be solved nor even touched on from any point of view, without our first making a choice between the following two maxims:

One man’s profit is another man’s loss.

One man’s profit is another man’s profit.

For if nature has arranged things in such a way that conflict is the law that governs free transactions, our sole recourse is to conquer nature and stifle freedom. If, on the other hand, these free transactions are harmonious, that is to say that they tend to improve our conditions and make them more equal, our efforts ought to be limited to allowing nature to (be free to) act and maintaining the rights of human freedom.

And this is why I urge the young people to whom this book is dedicated[388] to examine carefully the advice it contains and to analyze the deeper nature and effects of exchange. Yes, I am confident that one person will be found among them who in the end will achieve the strict demonstration of the following proposition: Each individual’s good encourages the good of all, just as the good of all encourages the good of each individual, and who will know how to instill this truth in the minds of all by making the proof simple, lucid, and undeniable. This person will have solved the social question, and will be the benefactor of the human race.

Indeed, let us note this: depending on whether this axiom is true or false, the natural social laws are (either) in harmony or in conflict. Depending on whether they are in harmony or in conflict, it is in our interest to conform to them or to free ourselves from them. If therefore it were demonstrated once and for all that in a free society interests are in agreement and encourage one another, all the efforts we now see being made to have governments disrupt the operation of these natural social laws, we would see governments devote themselves instead to allowing these laws to exert their full power. Or rather, no effort in this direction would be needed, other than to refrain from doing anything. In what does the interfering action of government consist? It is deduced from the very goal they have in sight. What is this? To alleviate the inequality assumed to arise from freedom. Well, there is just one means of re-establishing equilibrium, and that is to take from some to give to others. This is in fact the mission that governments have set themselves or that they have inherited, and this is the strict consequence of the epigram: One man’s profit is another man’s loss. Once this axiom is held to be true, coercion has to put right the harm that freedom does. In this way, the governments that we thought were instituted to guarantee freedom and property to each person have undertaken the task of violating all forms of freedom and property, and they are right to do this, if it is here that the actual basis of harm is found. Thus, we see them (governments) everywhere busily engaged in the artificial displacement of work, capital, and responsibility.

On the other hand, a truly incalculable amount of intellectual energy is being wasted in the pursuit of artificial forms of social organization. To take from some to give to others, violating freedom and property, is a very simple goal, but the ways of doing it are infinite. From this arises this multitude of (new social) systems that strike fear in all classes of workers, since by the very nature of their goal they threaten all interests.

Thus we have arbitrary and complicated forms of government, the denial of freedom and property, conflict between classes and nations, and all this is logically encompassed in this axiom: One man’s profit is another man’s loss. And for the same reason, smaller government, respect for individual dignity, the liberty of working,[389] free trade, peace between nations, security for person and property are all included in this truth, (that) interests are in harmony, on condition, however, that this truth is generally accepted.

Well, it is a far cry from being so. On reading the foregoing, many people will be inclined to say to me: You are preaching to the converted; who has ever seriously thought of querying the superiority of exchange (with others) over (living in a state of) isolation? In what book, other perhaps than those of Rousseau, have you met this strange paradox?

Those who stop me with this observation forget just two things, two symptoms or rather two aspects of our modern society: that is, the doctrines with which social theorists swamp us and the practices that governments impose on us. Nevertheless, the harmony of interests[390] must not be generally acknowledged since, on the one hand the the coercive power of the state is constantly engaged in intervening to upset the natural agreements between interests and on the other, it is constantly being criticised for not intervening enough.

The question is this: Is harm (and I should be clear that when I speak of harm here, it is not the harm that is the necessary consequence of our native/innate weakness) attributable to the action of (these) natural social laws or to the disruption to which we subject this action?

Well, there are two facts that exist side by side: harm and the coercive power of the state (which is) bent on upsetting the natural social laws. Is the first of these the consequence of the second? For my part, I think so; I would even say that I am sure of it. But at the same time, I can testify to this: as the harm develops governments seek a remedy in new disruptions to the operation of these laws, while social theorists criticise them for not disrupting them enough. Am I not entitled to conclude that people do not have much confidence in these natural social laws?

Yes, certainly, if the question is between living in isolation and exchanging with others, we would agree. But if it is between free trade and coerced exchange,[391] is the answer the same? Is there in France nothing artificial, compelled, restricted, or coerced in the way services relating to trade, credit, transport, the arts, education, and religion are exchanged? Are labor and capital distributed naturally between farming and manufacturing? When interests are displaced, do they still continue to obey their own impulses? Do we not encounter obstacles everywhere? Are there not a hundred occupations forbidden to the majority of us? Are Catholics not forced to pay for the services of Jewish rabbis and Jews for the services of Catholic priests?[392] Is there a single man in France who has received the education his parents would have given him if they were free to do so? Are our minds, habits, ideas, and industry not molded under a regime of arbitrary power or at least an artificial one. Well, I ask you, is the disruption of the free exchange of services not a denial of the harmony of interests? On what grounds does someone come to take away my freedom if not because it is thought harmful to others? Will it be said that it (my freedom) harms me personally?[393] In that case this is one conflict too many. And, Heavens above, what do we make of our situation if nature has instilled in man’s heart a constant, indomitable drive that makes him harm everybody, including himself?

Oh! So much has been tried; so when will we try the simplest thing of all, freedom? Freedom for all actions that do not harm justice, the freedom to live, to develop, and to improve oneself, the freedom to exercise our capacities, and the freedom to exchange services. Would it not have been a fine and solemn sight if the government which arose after the February revolution had addressed the citizens in these words:[394]

“You have invested me with the (coercive) powers of the state. I will use them only in those instances in which the use of force is permitted, and there is only one : (the pursuit or protection of) justice. I will force everyone to remain within the limits of his rights. May each of you work in freedom during the day and sleep in peace at night. I will be responsible for the security of both person and property; this is my mission and I will carry it out, but I will accept no other. Let there be no misunderstanding between us, therefore. From now on, you will pay me just the small amount which is essential for the maintenance of order and the dispensation of justice. However, you should also understand this fully, from now on each of you will be responsible for your own existence and improvement. Do not turn your gaze constantly in my direction any longer. Do not ask me to give you wealth, work, credit, education, religion, or a moral code.[395] Do not forget that the driving force that causes you to advance is within you, and that for my part I only ever act through the use of force, that I have nothing, absolutely nothing other than what I have been given by you, and that consequently I cannot confer the slightest benefit on one person without it being at the expense of others. Therefore you should work in your fields, manufacture and export your products, engage in commerce, provide each other with credit, provide and receive services freely, bring up your children, find them jobs, encourage the arts, improve your minds, refine your sentiments, form close relationships with each other, establish industrial or charitable associations, and unite your efforts both for the individual and the general good. Follow your inclinations, fulfill your destinies according to your capacities, your views, and your foresight. Expect from me just two things: freedom and security, and be fully aware that you cannot demand a third from me without losing both of these.”

Yes, I am convinced that if the February revolution had proclaimed this principle it would have been the final revolution. Could we envisage citizens who are otherwise perfectly free, aspiring to overthrow a government whose action is limited to satisfying the most pressing and most deeply felt of all social needs, the need for justice?

However, it was unfortunately impossible for the National Assembly to go down this path and utter these words. They did not correspond either to its thinking or to the expectations of the public. They would perhaps have cast as much terror into society as a proclamation of communism would.[396]

“Being responsible for ourselves!” people would have said. “Relying on the State for nothing other than the maintenance of order and peace! Expecting (to get) neither our wealth nor enlightenment from it! No longer being able to blame it for our faults, negligence, and lack of foresight!

Having only ourselves to rely on for our means of subsistence and our physical, intellectual, and moral improvement! Good God! What will become of us? Will society not be overwhelmed by poverty, ignorance, error, irreligion, and perversity?”

Everyone will agree that these might have been the fears expressed on all sides if the February Revolution had proclaimed freedom, that is to say the reign of natural social laws. Therefore either we do not know these laws or we have no confidence in them. We cannot put aside the idea that God has instilled in man impulses that are essentially perverse, that the only right thinking lies in the intentions and views of those in government and that the tendencies of the human race lead to the breakdown of organization and anarchy; in a word, we believe (that there is a) fatal conflict of interests.

For this reason, far from society in France showing the slightest aspiration toward a natural form of organization when the February Revolution broke out, never perhaps have its ideas and hopes been so ardently been turned to (the creation of) artificial schemes. (But) which ones? Nobody knew for sure. According to current parlance, it was a question of trying things out: Faciamus experimentum in corpore vili[397]. And people seemed to have reached such a degree of scorn for individuality, identifying man so closely to inert matter, that people spoke of carrying out social experiments on people just as you carry out chemical experiments using alkalis and acids. The first experiment was begun in Luxembourg,[398] and we know what result it produced. Shortly after this the Constituent Assembly set up a Labour Committee,[399] in which thousands of social plans were engulfed. We saw a representative of Fourierism[400] seriously asking for land and money (he would doubtless not have waited long before asking for men as well) with which to set up his model form of society.[401] Another representative of egalitarianism also offered his program, which was rejected. Manufacturers were more fortunate in having their plan accepted. Last of all, recently the legislative Assembly nominated a commission to organize welfare assistance.[402]

What is surprising in all this is that the holders of power, in order to ensure the stability of their own power, did not now and then step forward to make the point that: “You are making thirty-six million citizens accustomed to thinking that we are responsible for all that happens to them in this world whether for good or ill. On this basis, no form of government is possible.”

Be that as it may, while these various social inventions, honoured by the name of “Organisation,"[403] differ from one another in procedure, they are all based on the same principle: Taking from some (in order) to give to others. Well, it is perfectly obvious that a principle like this cannot have gained such universal approval within the nation unless people are totally persuaded that interests are naturally in conflict with one another and human tendencies are essentially perverse.

Taking from some to give to others![404] I am perfectly aware that things have been happening like this for a long time. But before dreaming up a variety of means to achieve this strange principle for curing poverty, should not the question have been asked whether poverty was not the inevitable result of the fact that this principle had been carried out (already) in one form or another? Before seeking a remedy in new disturbances made to the reign of natural social laws, should people not have made sure that these disturbances were not actually the (cause of) the ills from which society was suffering, and which they were hoping to cure?[405]

Taking from some to give to others! May I be allowed at this juncture to point out the danger and absurdity of the economic idea behind this so-called social aspiration which was brewing up within the masses and which burst forth with such force in the February Revolution?[406]

When there are still several strata[407] in society, we can understand that the first of these enjoys privileges at the expense of all the others. This is odious but not absurd.

The second strata will not fail in this circumstance to breach the fortifications of privilege, and with the help of the masses it will succeed in bringing about a Revolution sooner or later. In this case, when the power of the state is in its hands, we can also see that it will establish itself as the ones with privileges.[408] This is still odious but not absurd and at least not impracticable, for privilege is possible as long as there is the mass of the people below to support it. If the third and fourth strata also stage their own revolution, they will, if they can, also arrange to exploit the masses through cleverly organized privileges. But here we have the bulk of the public who have been trampled on, put under pressure, and worn out, also causing a revolution. Why? What will they do? Perhaps you think that they will abolish all privileges and bring in the reign of universal justice? Will they perhaps say: Away with (all) restrictions, away with shackles, away with monopolies, away with government interventions that benefit one class, away with heavy taxes, and away with diplomatic and political intrigue?[409] No, their aim is quite different. They now solicit, and in turn they demand to become privileged. They, the public masses, imitate the upper classes and demand privileges in their turn! They want the right to work, the right to credit, the right to education, and the right to assistance! But at whose expense? They do not go to the trouble of finding out. All they know is that if they were assured work, credit,[410] education, and rest in their old age, all free of charge, that would be a good thing and certainly nobody would deny this. But is it possible? Alas, no! And this is why I state that here the element of odiousness disappears but absurdity is at its height.

Privileges for the masses! Dear people,[411] do think about the vicious circle in which you are putting yourselves. Privilege assumes that there is someone to enjoy it and someone to pay for it. We can imagine one man who is privileged or one class that is privileged, but is it possible to imagine an entire people who is privileged? Is there another social stratum below you on whom you can place the burden? Will you never understand the strange hoax that has duped you?[412] Will you never understand that the state can never give you something with one hand without having taken a little more from you with the other?[413] That under this system, far from there being for you any increase in well-being, the aftermath of the process is arbitrary government, (which is) more vexatious, with more powers, more spendthrift and unstable. You will have heavier taxes, more instances of injustice, harmful (government) favors, more restricted liberty, loss of (economic) strength, (the rise of vested) interests, displaced labor and capital,[414] with greed aroused, discontent encouraged, and individual energy stifled.

The upper classes are growing alarmed at this sorry attitude of the masses, and not without cause. They see in it the seed of constant revolutions,[415] for what government can withstand the pressure when it has been unfortunate enough to say: “I have power and I will use it to enable everyone to live at the expense of everyone else.[416] I will be responsible for universal happiness?” But is the terror felt by these classes not a punishment that is deserved? Have they themselves not given the masses a disastrous example[417] of the attitude of which they are complaining? Have they not constantly had their eyes fixed on government favors? Have they ever failed to grant a privilege, whether large or small, to factories, banks, mines, private property in land, or the arts, and even to their means of recreation and entertainment, to dancing, music, in short to everything except for the work done by the masses, manual work? Have these classes not urged an increase in the number of public functions in order to increase their standard of living[418] at the expense of the masses, and is there now one head of a household who is not thinking about getting a government job for his son? Have they ever voluntarily removed one of the acknowledged inequalities in the tax system?[419] Have they not exploited everything, even electoral privilege, for years?[420] And now they are amazed and upset because the masses are letting themselves step onto the same slippery slope! But when the attitude of begging has prevailed for so long in the wealthy classes, how do you expect it not to have penetrated into the suffering classes as well?

Nevertheless a great Revolution has been accomplished. Political power, the ability to make laws, and the control of the state’s coercive power has passed to all extents and purposes, if not as a matter of fact quite yet, into the hands of the People, with the coming of universal suffrage.[421] Thus, those who caused the problem will be called upon to solve it, and woe betide the country if, following the example it has been given, it seeks the solution in privilege, which is always a violation of the rights of others. It will certainly end in disappointment, and through this, in a great lesson, for while it is possible to violate the rights of many in favor of a few, how could one violate the rights of all in favor of all? But at what price will this lesson have been learnt? What should the upper classes do to prevent this terrible danger? Two things; they should renounce all privileges for themselves and enlighten the masses, for there are only two things that can save society, justice and enlightenment. They should look carefully to see whether or not they are enjoying some form of monopoly, which they can then renounce, whether or not they are benefiting from some artificial inequalities which they can eliminate, whether or not pauperism can be attributed at least in part to some disturbance of the natural social laws, which they can put a stop to, so that they can say while showing their hands to the people: “These hands may not be empty, but they are clean.” Is this what they are doing? Unless I am blind, they are doing quite the opposite. They are beginning by keeping their monopolies, and we have seen them even taking advantage of the revolution to see if they can increase them. Once they have distanced themselves from any possibility of telling the truth and thereby invoking principles, in order not to appear too inconsistent, they promise to treat the people as they are treating themselves, and wave the bait of privilege before their eyes. Only they think they are being very cunning in only granting them now just one small privilege, the right to government assistance,[422] in the hope of dissuading them from demanding a large one, the right to to a job.[423] And they do not see that systematically extending the axiom: Take from some to give to others, is to strengthen an illusion that creates problems now and dangers for the future.

However, we should not exaggerate. When the upper classes seek a remedy for the harm caused by privilege by extending privilege, they are in good faith and are acting, I am convinced, more through ignorance than through injustice. It is an irreparable misfortune that succeeding governments in France have always put obstacles in the path of teaching political economy.[424] The teaching of this subject would be an even greater benefit than our university filling our heads with the prejudices of the Romans[425] since a university education fills our heads with Roman prejudices, that is to say, all that is most contrary to social truth. This is what makes the upper classes go wrong. It is fashionable now to speak out against the upper classes. For my part, I consider that never before have they had such benevolent intentions. I believe that they ardently wish to solve the social problem. I believe that they would do more than renounce their privileges and that they would willingly sacrifice part of the property they have acquired to charitable work if, by doing this, they believed they were bringing the sufferings of the working classes to a permanent end. It will doubtless be said that they are being driven by self-interest or fear, and that there is no great generosity in giving up part of their assets to save the rest. It is man’s common prudence to allow a fire to burn some of the undergrowth to protect the trees. Let us not denigrate human nature in this way. Why should we refuse to recognize a less selfish motive? Is it not very natural for the democratic customs that are prevalent in our country to make people aware of the sufferings of their fellow-men? However, whatever the sentiment that is uppermost, what cannot be denied is that everything that can be expressed through general opinion, philosophy, literature, poetry, drama, religious teaching, parliamentary discussion, or journalism reveals more in the well-off classes than just a desire or ardent thirst for a solution to the great problem. Why then does nothing emerge from our legislative Assemblies? Because they do not know this. Political economy offers them the following solution: justice provided by the state and charity provided privately.[426] The legislative assemblies take the opposite course and, without realizing it, obey the socialist influence and want to encase charity in law, that is to say, banish justice from it at the risk of killing off private charity at the same time, which is always swift to give way to state provided charity.

Why then do our legislators overturn every notion in this way? Why don’t they leave each one in its (proper) place, fellow-feeling in its natural place, which is (that of) freedom, and justice in its place, which is (that of) the law?[427] Why don't they apply the law exclusively to enforce justice? Might this be because they dislike justice? No, but they lack confidence in it. Justice is freedom and property. Well, they are socialists without knowing it,[428] and in order to reduce poverty progressively and expand wealth indefinitely, whatever they say, they have no faith in freedom and property, and consequently no faith in justice. And this is the reason we see them in all good faith seeking to achieve the good through the perpetual violation of what is right.

What may be called natural social laws is the group of phenomena, considered both from their driving force and their results, that govern free transactions between men.

This having been said, the question is this:

Should we let these laws act freely or should we prevent them from acting?

This question amounts to this:

Should we acknowledge each person’s property and freedom, his right to work and exchange on his own responsibility, whether this punishes him or rewards him, and to have the law, which is the coercive power of the state intervene only to protect these rights? Or else, can we hope to reach a greater sum of social happiness by violating property and freedom, by regulating work, upsetting trade, and displacing responsibility?

In other words:

Should the law give precedence to strict justice, or should it be the instrument of plunder organized more or less intelligently?[429]

It is very clear that the solution to these questions is subject to the study and knowledge of natural social laws. We cannot utter a reasonable opinion without knowing whether property, freedom, or the groups of services that are voluntarily exchanged between men, encourage them to advance, as economists believe, or to regress, as socialists claim. In the first case, social harm has to be attributed to the disruption of natural laws and the violation of property and freedom by the state.[430] It is these disruptions and violations that have to be stopped, and political economy is right. In the second case, (according to the socialists) we do not yet have enough government intervention. Artificial and coerced schemes have not been sufficiently substituted for natural and free ones. These three disastrous principles, justice, property, and freedom are still too much in vogue. Our legislators have not yet assailed them enough. We do not yet take enough from some to give to others. Up to now, we have taken from the majority to give to the minority. Now we have to take from everyone to give to everyone. In a word, plunder has to be “organized” and our salvation will come from socialism.

Fatal Illusions that arise from Exchange.[431]

Exchange is is society. Consequently, economic truth provides the complete view and economic error the partial view of exchange.[432]

If men did not trade, each economic phenomenon would be accomplished by (each) individual and it would be very easy for us to note its good and bad effects through observation.

However, exchange has led to the division of labor, in common parlance the establishment of (many) professions and trades. Each service (or each product) therefore has two relationships, one with the person providing it and the other with the one receiving it.

Doubtless, at the end of the day, the man who lives in society, like the man who lives in isolation, is both (a) producer and (a) consumer.[433] However, you have to see the difference between these clearly. Man living in isolation is nevertheless the producer of the item even as he consumes it. This is almost never so for the man living in society. This is an incontrovertible fact, and one that each of us can verify for ourselves. Besides, this results from the fact that society is nothing more than the exchange of services.

We are all producers and consumers, not of a product but of the value we have produced. While exchanging objects we always remain the owners of their value.

It is from this that all illusions and economic errors arise. It is certainly not superfluous to point out at this juncture the way the human mind works in this connection.

The general term obstacle can be given to everything that comes between our needs and our satisfactions, and which stimulates the intervention of our effort.

The relationship between these four elements, need, obstacle, effort, and satisfaction[434] are perfectly visible and understandable in men living in isolation. Never, ever, would it occur to us to say:[435]

“It is a pity that Robinson Crusoe does not encounter more obstacles, for if he did, he would have more opportunity of making an effort; he would be wealthier.”

“It is a pity that the sea washed up useful objects on the shores of the Island of Despair, useful objects like planks, food, weapons, and books, for this has deprived Robinson Crusoe of the opportunity of making efforts; therefore he is less wealthy.”[436]

“It is a pity that Robinson Crusoe invented nets to catch fish or game, for that has reduced the amount of effort he has had to expend for a given result; he is less wealthy.”

“It is a pity that Robinson Crusoe is not sick more often. This would give him the opportunity of curing himself, which is work, and since all wealth comes from work he would be more wealthy.”

“It is a pity that Robinson Crusoe was successful in putting out the fire that threatened his hut. There he lost a precious opportunity for work; he is less wealthy.”[437]

“It is a pity that the soil on the Island of Despair was not more arid, water more distant, and that there were fewer hours of sunlight each day. Robinson Crusoe would have had to take more trouble to feed himself and provide himself with drink and light; he would be more wealthy.”

Never, I say, would anyone put forward such absurd propositions as oracles of the truth. It would be only too palpably obvious that wealth does not consist in the intensity of the effort devoted to each satisfaction achieved and that it is precisely the contrary that is true. It would be understood that wealth does not lie either in need, obstacles, or effort, but in satisfaction, and nobody would hesitate to acknowledge that while Robinson Crusoe is both a producer and a consumer, in order to assess his progress it is not his work but the results of it that have to be considered. In short, by proclaiming the following axiom: that the most important interest is that of the consumer;[438] we believe that we are just expressing a genuine truism.

How fortunate are those nations who see clearly how and why the things we find right and wrong when it concerns a man living in isolation are still right or wrong when it concerns man living in society!

Nevertheless, what is certain is that the five or six propositions that appeared absurd to us when applied to the Island of Despair appear so incontrovertible to us when applied to France that they are used as the basis for our entire economic legislation. On the contrary, the axiom that seemed to us to be the essence of truth when applied to individuals is never invoked in the name of society without raising a scornful smile.

Could it be true then that exchange changes our very nature as human beings to such an extent that what causes poverty in individuals is the cause of wealth in society?

No, that is not true. However, it has to be said that it is seductive, highly seductive even, since it is so widely believed.

Society consists in this: we work for one another. We receive more services the more we render, or the more those services we render to others are more highly valued, sought after, or well paid (for). On the other hand, the division of labor means that each of us applies his efforts to overcoming an obstacle that lies in the way of the satisfaction of someone else. Farmers combat the obstacle known as hunger, doctors that known as disease, priests that known as vice, writers that known as ignorance, coal miners that known as cold, etc., etc.

And, since all those who surround us are all the readier to reward our efforts when the obstacle hampering them is clearly seen, it follows that we are all inclined, from (our) point of view as producers, to cultishly exaggerate the importance of that which we make our business to remove. We consider ourselves to be wealthier if these obstacles increase (in number) and immediately conclude that what is to our individual advantage is to the advantage of all. …. [439]

 


 

V. On Value

Editor’s Introduction

This chapter was the second longest in the edition of EH published by Bastiat in his lifetime (Jan. 1851) at 18.5K words (the longest was chap. IX “Property in Land” with 18.9K words followed by chap. IV “Exchange” with 15.2K words). It would become the longest in later editions when additional notes and drafts were added by Paillottet, bringing the total up to 22.8K words. The version we have here is made up of three parts: the main part of 18.5K words which appeared in EH1, followed by a draft of notes of 3.5K words found by Paillottet and included in EH2, and a long footnote of 689 words which Paillottet included in the 1855 edition of Bastiat’s Oeuvres complètes.[440]

Text (EH1)

A dissertation, what boredom! A dissertation on value, boredom piled (up)on boredom![441]

Consistently with this attitude, has not every novice of a writer, faced with a problem in economics, tried to solve it, without giving any definition of value?

However, it will not be long before he acknowledges how inadequate this procedure is. The theory of value is to political economy what counting is to arithmetic.[442] In what inextricable tangles would Bezout[443] not have found himself if, to spare his pupils some drudgery, he had undertaken to teach them the four rules and the proportions (of algebraic curves) without first explaining to them the value that the figures take from their diagram or their position?

If only the reader had some sense of the beautiful conclusions that can be deduced from the theory of value! He would accept the boredom of these initial notions, just as one resigns oneself to the difficult study of the elements of geometry in view of the magnificent domain that they open out to our minds.

However, this sort of intuitive fore-glimpse is not possible. The more I take care to distinguish value either from utility or from labor in order to show how natural it was for economic science to stumble initially at these pitfalls, no doubt the more people will be inclined to see in this refined discussion mere sterile and unnecessary subtleties that are only fit only to satisfy the curiosity of those familiar with the field.

You struggle laboriously, people will say, to find out whether wealth lies in the usefulness of things, in their value, or in their rarity. Is this not a question, like that of the Scholastics: Does form lie in the substance or in the accident? And are you not afraid that a street smart Molière will hold you up to the ridicule by the public (who attend) the Variétés theatre?[444]

And yet I have to say that, from the economic point of view, society is exchange.[445] The first creation of exchange is the notion of value, so that all truth or error introduced into the human mind through this word is a social truth or error.

In this chapter I am undertaking to demonstrate the harmony of the providential laws that govern human society. What makes these laws harmonious and not disharmonious is that all the principles, driving forces, springs, and interests contribute to the attainment of a great end result, which the human race will never achieve because of its innate imperfection, but toward which it will constantly progress because of its indomitable ability to perfect itself, this result is the never ending approach of all classes to a standard of living that is constantly rising, in other words, making individual people (more) equal as part of the general process of improvement).[446]

But in order to succeed in my account, I have to put across two things, which are:

1. That utility tends to become increasingly free of charge and common to all as it moves out of the domain of the individual appropriation of property;[447]

2. That value, on the other hand, which is alone capable of being owned and the sole constituent of property both in law and fact, tends to decrease continually compared to the utility to which it is attached.

So that, if it is properly done, a demonstration like this, based on private property (but only on private property of value) and on the common availability of utility, has to satisfy and reconcile all the schools of thought by granting that they have all glimpsed the truth, but just part of the truth, as seen from various points of view.[448]

Economists, you defend private property. In the social order there is no other property than that of things of value, and this is unshakeable.

Communists,[449] you dream of the community (of goods).[450] Well you have it. The social order makes all things of use common (to all), on condition that the exchange of privately owned things of value[451] is made freely.

You are like architects who quarrel over a monument, which they have seen from just one side. They do not see incorrectly, but they do not see everything.[452] To make them agree, all you need is to persuade them to walk around the edifice.

But how can I reconstruct this social edifice in all of its beautiful harmony, in public view, if I reject its two cornerstones, utility and value? How can I bring about the desirable reconciliation of all the schools of thought on the ground of truth if I flinch at the analysis of these two ideas, and while the disagreement arises from the unfortunate confusion that they have generated?

These introductory remarks were necessary to get the reader, if at all possible, to devote a moment of attention, concentration, and probably, alas, also some boredom. Either I am under a great illusion or the appealing beauty of the consequences will compensate for the aridity of the premises. If Newton had allowed himself to be put off at the outset by a distaste for his initial mathematical studies, his heart would never have beaten with admiration at the sight of the harmony of celestial mechanics, and I maintain that it is enough to go through a few elementary notions in a purposeful manner to recognize that, in the social mechanism, God has not displayed any less touching goodness, admirable simplicity, or magnificent splendor.

In the first chapter, we saw that man is both passive and active, that since need and the satisfaction (of need) affected only the senses, they were by their nature personal, private, and non-transferrable, that on the contrary, effort, (which is the) the link between need and satisfaction, and the means between the object of the exercise and the end, starting with our actions, spontaneity, and determination, might be subject to agreements and to (the possibility of being) transferred (to another). I know that this assertion might be disputed from the metaphysical point of view, and the claim made that effort too is personal. I do not wish to enter the terrain of ideology, and I hope that my thought will be accepted in this commonsense form: We cannot feel the needs of others, we cannot feel the satisfactions (enjoyed by) others, but we can render services to one another.

It is this transfer of effort, this exchange of services that is the subject matter of political economy and since on the other hand economic science can be summed up in the word value, of which economics is merely the lengthy explanation, it follows that the notion of value will be imperfectly and wrongly perceived if it is based on the extreme phenomena that take place in the realm of our senses, i.e. needs and satisfactions, (which are) private phenomena that are not transferrable (to others), incommensurable between one person and another, instead of being based on the (outward) expressions of our actions, our efforts, and the mutual services that are exchanged, because it is possible to compare them, appreciate them, and evaluate them, and they are capable of evaluation precisely because they are exchanged.[453]

In the same chapter, we reached the following conclusions:

Utility (the ability of certain acts or things to serve us) is made of several parts: One part is due to the action of nature, the other to the action of human beings.”[454] “There is all the less for human work to do for a given result, the more nature does.” “The contribution of nature is essentially free of charge, while the contribution of man, whether intellectual or physical, exchanged or not, collective or individual, is essentially onerous (or costly), as the very word, effort, implies.”

And since what is free cannot have a value, because the idea of value implies that it has been acquired onerously, it follows that the notion of value will still be wrongly perceived if we extend it, either wholly or partially, to gifts or the contribution of nature, instead of restricting it exclusively to the human contribution.[455]

Thus on both sides and by different routes we reach the conclusion that value has to relate to the efforts made by man to satisfy his needs.

In the third chapter,[456] we noted that man could not live in isolation. But if, in our thoughts, we envisage this imaginary situation, this unnatural state that the 18th century extolled in the name of a state of nature, [457]we would soon acknowledge that it still does not reveal the notion of value, although it does introduce that expression of our principle of (human) action[458] that we have called effort. The reason for this is simple: value implies comparison, appreciation, evaluation, and measurement. For two things to be measured against each other they have to be commensurate and for this they have to be of the same nature. In (a state of ) isolation, to what can we compare effort? To (our) need or to (our) satisfaction (of that need)? That can lead only to its being acknowledged to be more or less appropriate, more or less advisable. In a social state, what is being compared (and it is from this comparison that the idea of value arises) is the effort of one man to that of another, two phenomena of the same nature and consequently commensurable.

Thus, to be accurate, the definition of the word value has to relate not only to human efforts but also to efforts that are or can be exchanged. The exchange does more than recording and measuring values, it brings them into existence.[459] I do not mean to say that it brings into existence the acts and things that are exchanged, but it gives existence to the notion of value.

Well, when two men mutually give each other their current effort or the results of their previous efforts, they serve one another and provide (reciprocal) services to one another.

Therefore I say: Value is the relationship between two services which are exchanged.

The idea of value entered the world (for) the first time, (when) one man having said to his brother: “Do this for me and I will do that for you,"[460] they made an agreement, because then for the first time it was possible to say: The two services being exchanged were of equal value.

It is rather strange that the true theory of value that one can look for in vain in many a heavy tome, is to be found in the delightful little fable by Florian[461] entitled “The Blind Man and the Cripple”:[462]

Let us help each other,

The weight of misfortune will be all the less,

…… Between us

We possess the asset that each needs.

I have limbs, and you eyes.

I will carry you, and you will be my guide:

Thus, without our friendship ever deciding

Which of us accomplishes the more useful role,

I will walk for you, and you will see for me.

Here value has been found and defined. Here it is in all its strict economic accuracy, except for the touching mention of friendship, the mention of which transports us into a different realm. We see that two unfortunates render each other reciprocal services without going too far to find out which of the two fulfills the more useful role. The exceptional situation invented by our fable teller explains very well that the principle of fellow-feeling, acting with great power, has hidden, so to speak, the careful evaluation of the services being exchanged, an evaluation that is essential for the notion of value to be made completely clear. This notion would be fully revealed if all men, or the majority of them, were struck by paralysis or blindness, for in this case the inexorable law of supply and demand would take the upper hand and, having eliminated the constant sacrifice accepted by the person who carried out the more useful job, it would relocate the transaction on the ground of justice.

We are all blind or crippled in some way. We soon understand that by helping each other we make the burden of misfortune all the lighter. From this comes Exchange. We work to feed, clothe, house and light, cure, defend, and educate one another. From this come mutual Services. We compare these services, discuss and evaluate them. From this comes Value.

A host of circumstances can increase the relative importance of a service. We find it more or less significant depending on whether it is more or less useful to us insofar as more or fewer people are willing to provide it to us, whether it demands from them more or less work, trouble, skill, time, and preliminary training, and whether it saves us more or less of all these. Not only does the value of things depend on these circumstances but also on our estimation of it, for it may happen, and often does, that we estimate a service highly because we consider it to be very useful, while in reality it is harmful to us. For this reason vanity, ignorance, and error have their share of influence on this essentially elastic and fluctuating relationship that we call value, and it may be rightly maintained that the appreciation of services tends to approach absolute truth and justice as men become more enlightened, more moral, and more sophisticated.

Up to now, we have sought the principle of value in one of the circumstances that increase or diminish it, such as (its) materiality, duration, utility, scarcity, (the amount of) labor, (the) difficulty of (its) acquisition, (our) estimation (of its usefulness), etc. (This is) a wrong direction stamped from the outset on science, since the contingency that modifies the phenomenon is not the phenomenon itself. What is more, each writer has set himself up, so to speak, as the godfather of one of these circumstances that he believed to be preponderant, a result that is always reached when we generalize, since everything is in everything else, and there is nothing that we cannot put into a word by expanding its meaning. Thus the principle of value for Smith lies in (its) materiality and duration, for Say in (its) utility, for Ricardo in labor, for Senior in scarcity, and for Storch in individual judgement, etc.[463]

What happened and what ought to have happened? What these writers have innocently done is to undermine the authority and dignity of economic science by appearing to contradict each other, when in reality each of them was right from his point of view. What is more, they have dropped the initial notions of political economy into a maze of inextricable difficulties, for the same words no longer represented the same ideas for these writers, and besides, although one factor was proclaimed to be fundamental, the others were deployed in too obvious a manner not to carve themselves out a place, and definitions were seen to become increasingly lengthy.

This book is not intended to be controversial, but to set out the facts. I am showing what I see, and not what others have seen. Nevertheless, I cannot stop myself from drawing the reader’s attention to the circumstances in which the basis of value has been sought. But before this, I must make value display itself before him through a series of examples.[464] It is through a variety of applications that a theory is understood intellectually.

I will show how everything is reduced to a series of bartered services.[465] All I ask is that you remember what has been said about barter in the preceding chapter.[466] It is rarely simple; sometimes it takes place by circulation among several contracting parties, but in the main through the use of money and in this case it is broken down into two factors, sale and purchase. However, since this complication does not alter its nature, in order to make things easier, I will allow myself to assume that the barter is immediate and direct. This cannot lead us into any misunderstanding about the nature of value.

We are all born with a pressing material need that has to be satisfied on pain of death, the need to breathe. On the other hand, we are all immersed in an environment that in general meets this need without any effort on our part. The atmosphere thus has utility but no value.[467] There is no value because, since it requires no effort, it does not give rise to any service. Providing a service to someone is to save him some trouble on his part, and where no such trouble has to be taken to achieve satisfaction no trouble can be saved.

But if someone dives to the bottom of a river in a diving bell,[468] a foreign object comes between the air and his lungs; a pump has to be started up to establish communication between the two. In this case, an effort has to be made and trouble taken, and the person in question would be only too ready to agree, since it is a matter of life and death, and there is no greater service that he can render himself.

Instead of making this effort himself, he asks me to do this for him, and in order to persuade me he undertakes to take on some trouble himself to provide me with (some) satisfaction. We discuss the matter and come to an agreement. What does this show us? Two forms of need and two forms of satisfaction that do not change position; two forms of effort that are the subject of a voluntary transaction, two services that are exchanged and, lo and behold, value appears.

Now it is said that utility is the basis of value, and since utility is inherent in the air, people’s minds are led to believe that so is value. In this there is an obvious confusion. By its very constitution, air has physical properties that are in harmony with one set of our physical organs, our lungs. What air I take from the atmosphere to fill a diving bell does not change in nature; it is still oxygen and nitrogen. No new physical quality has been introduced; no chemical reagent makes a new element called value emerge. The truth is that value arises solely from the service rendered.

When someone puts forward the axiom: Utility is the basis of value, if you hear it said that service has value because it is useful to the person receiving and paying for it, I have no quarrel with this. This is a truism that is taken sufficiently into account by the word service.

However, what you should not confuse is the usefulness of the air and the usefulness of the service. These are two quite different forms of utility, ones of a different order and a different nature, bearing no relation one to the other and between which there is no connection. There are circumstances in which I can, with just a little effort and by saving him just a little trouble, and consequently providing him with a tiny service, make available to someone something that is of very great intrinsic utility.

Let us try to find out how two contracting parties go about estimating the value of the service that one is providing the other by sending air down to him. A point of comparison is needed, and this can lie only in the service that the diver has undertaken to provide in return. Their reciprocal demands will depend on their respective situations, the intensity of their wants, the greater or lesser facility of doing without each other, and the host of circumstances that demonstrate that value resides in the service, since it grows along with it.

And if the reader is willing to take this trouble, it will be easy for him to vary this hypothesis so that he sees that value is not necessarily proportionate to the intensity of effort, an observation that I insert at this point like a foundation stone on which I will build later, for what I have to prove is that value lies no more in work than it does in utility.

Nature has been pleased to design me in such a fashion that I will die if I do not drink from time to time and the spring lies one league from the village. For this reason, every morning I take the trouble to go to collect my small provision of water, for it is in water that I have recognized the useful qualities of being able to assuage the suffering that is known as thirst. Need, effort and (the) satisfaction (of needs) are all there. I know about utility, but not about value as yet.

However, since my neighbor also goes to the spring, I say to him: “Save me the trouble of making the journey; do me the service of bringing me some water.[469] During this time, I will do something for you, I will teach your child to spell.” It so happens that this suits both of us. Here is an exchange of two services, and it can be said that one is worth (the same as) the other. Note that what has been compared here are the two forms of effort, not the two needs and the two satisfactions, for according to what criteria would we compare the benefit of drinking with that of being able to spell?[470]

Soon I tell my neighbor: “Your child is a nuisance; I would prefer to do something else for you. You will continue to bring me water and I will pay you five sous.” If this proposition is agreed to, economists might be able to say, with no fear of error: the service is worth five sous.[471]

Later on, my neighbor does not wait for me to ask him; he knows through experience that I need to drink every day. He anticipates my wishes. At the same time, he supplies other villagers. In short, he has set himself up as a water-seller.[472] At this stage, people begin to say: water is worth five sous.

But has water really changed its nature? Has value, which lay in the service a short time ago, taken on a physical form that has moved to the water and added a new chemical element to it? Has a slight modification in the form of the arrangements that existed between me and my neighbor had the ability to shift the principle of value and change its nature? I am not enough of a purist to object to people saying: water is worth five sous, just as they say: the sun is going down. But you have to realize that these are metonymies and that metaphors do not affect the reality of facts. Scientifically, for we are in the end doing science, value does not lie in the water any more than the sun goes down into the sea.

Let us therefore leave to things the qualities that are proper to them. Air and water have utility;[473] services have value.[474] Let us say: Water is useful because it has the property of assuaging (our) thirst; it is the service that has value, because it is the subject of an arrangement that has been thrashed out. This is so true that if the spring moves further away or comes closer, the utility of water remains the same, while its value increases or decreases.[475] Why? Because the service is greater or lesser. The value therefore lies in the service, since it varies with it and proportionately.

Diamonds have a huge role in the writings of economists,[476] which use them to elucidate the laws of value or to point out the alleged disturbances to these laws. This is a brilliant weapon used by all the schools (of economic thought) to fight one another. If the English school says: “Value lies in labor," the French school will show it a diamond and say: “Here is a product that requires no work and encompasses huge value." If the French school claims that value lies in utility, the English school will immediately contrast the diamond with air, light, and water. “Air is very useful,” it will say, “and has no value; diamonds have a utility that is very debatable and are worth more than the entire atmosphere.” And the reader will say, like Henry IV: “Faith, they are both right.”[477] In the end agreement is reached on this error, which exceeds the two others. It has to be said that God puts value into His works and that it is a material thing.

These anomalies vanish, I think, when faced with my simple definition, which is confirmed rather than contradicted by the example in question.

I am walking by the seaside.[478] By good fortune I come across a superb diamond. Here I am, in possession of something of huge value. Why should this be? Will I be spreading great good around the human race? Have I undertaken a long and arduous task? Neither of these. Why has this diamond so much value? Doubtless because the person to whom I sell it thinks that I am doing him a great service, one that is all the greater because a great many wealthy people are on the lookout for it and I alone can provide it. The reasons for his judgement are debatable, I agree. They arise from vanity and pride; right again. But this judgement exists in the mind of a man (who is) willing to take action as a result, and that is enough.

Far from the estimation being based here on a reasonable appreciation of utility, it might be said that quite the contrary is true. Showing that it is capable of making great sacrifice for something useless is precisely the aim ostentation sets itself.

Far from the value here being in a logically necessary proportion to the work carried out by the person providing the service, it might be said that it is actually proportional to the work spared to the person receiving it; this, moreover, is the law of value,[479] a general law which has not, as far as I know, been observed by economic theory, although it governs universal practice. We will indicate later the marvelous mechanism that makes value tend to align itself proportionately to labor when the latter is free, but it is no less true that its basis is less in the effort made by the person serving than in the effort spared to the person served.

In fact the transaction relating to our precious stone implies the following dialogue:

“Sir, sell me your diamond.”

“Sir, I am quite willing to do so; in return, sell me your labor for an entire year.”

“But Sir, you have not devoted one minute to acquiring it.”

“Well, Sir, (just) try to find another minute like that.”

“But in all fairness, we ought to be exchanging an equal quantity of work.”

“No, in all fairness, you estimate the value of your work and I mine. I am not forcing you; why should you force me? Give me an entire year or look for a diamond yourself.”

“But that would involve me in ten years of arduous searching, not to mention a probable disappointment at the end. I think it wiser and more advantageous to use these ten years in some other way.”

“That is exactly the reason why I consider that I am providing you with a further service in asking you for just one year. I am saving you nine, and that is why I attach such value to this service. If I appear to be very demanding to you, it is because you are looking only at the work I have done, but all you have to do is to consider the work I am sparing you for you to consider me very good-natured.”

“It is no less true for all that, that you are taking advantage of work done by nature.”

“And if I sold you what I found for nothing or next to nothing, you would be the one getting the benefit. Besides, if this diamond is of great value, it is not because nature has been making it from the dawn of time, it does just as much for a dewdrop.”

“Yes, but if diamonds were as numerous as dewdrops, you would not be able to lay down the law.”

“Probably not, because in that case you would not be coming to see me, or you would not be willing to reward me handsomely for a service that you were able to obtain so easily for yourself.”

It follows from this dialogue that value, which we could not locate in either water or air, is not present in diamonds either. It lies entirely in the services rendered and received when these things become available and determined by the free negotiation of the contracting parties.

Take the collected works of the Economists. Read and compare all the definitions. If there is one that holds both for air and diamonds, two instances apparently so different, throw this book in the fire. However, if my definition, as simple as it is, solves the difficulty, or rather makes it disappear, then (dear) reader, in all (good) conscience, you have to go all the way (to the end of my book), because it can’t have been in vain that (such) a good introduction has been provided at the beginning of our study of economic science.

Perhaps I may be allowed to give more examples like this, as much to clarify my thought as to familiarize the reader with a new definition. By showing it from all angles, this exploration of the key ideas also prepares the way for understanding the consequences, which I dare say, will be as significant as they are unexpected.

Among the needs to which our physical constitution is subject is that for food, and one of the things most suited to satisfying it is bread.

Naturally, since the need to eat is in me, I have to do all that is necessary to secure the quantity of bread I need. I am all the less able to demand that my fellow men give me this service free of charge, in that they themselves are subject to the same need and condemned to make the same effort.

If I made my bread myself, I would have to undertake work that is infinitely more complicated but perfectly analogous to the need that obliges me to go and collect water from the spring. In fact the ingredients of bread are everywhere in nature. According to the judicious comment by J. B. Say,[480] there is neither need nor opportunity for man to create anything. Gases, minerals, electricity, the energy of plants – all exist; it is just up to me to gather them, attend to them, mix, and transport them, making use of this great laboratory that is the earth, in which mysteries take place under whose veil human knowledge has scarcely begun to peep. Although the set of operations I accomplish in pursuing my goal is very complicated, each of them, taken on its own, is as simple as the action of going to draw from the spring the water that nature has put there. Each of my efforts is therefore nothing other than a service I am providing to myself, and if, as a result of an agreement freely entered into, it happens that other people save me some or all of this effort, I am receiving a corresponding number of services. The sum of these services, compared to those I provide in return, constitute, and determine the value (price) of bread.

A convenient intermediary has developed to facilitate this exchange of services, and even to measure their relative importance, namely money. But the fundamental nature of things remains the same, just as the transmission of power is subject to the same law whether it takes place through one or more sets of gears.

This is so true that when bread is worth four sous, for example, if a good bookkeeper wished to break down this value, he would succeed in finding, doubtless through a very large number of transactions, all those whose services have gone into making it, all those whose services have saved the efforts of this or that person who, when all is said and done, pays because he is going to eat it. Our bookkeeper will find the baker, first of all, who takes a twentieth and out of this twentieth pays the mason who has built his oven, the lumberjack who has prepared his logs, etc. Then comes the miller, who will be paid not only for his own work but enough to pay for the quarryman who made the millstone, the earthmover who built the banks for his millrace, etc. Other shares of the total value would go to the flayer in the barn, the harvester, the farmer, and the sower, until the last obole is accounted for. There is not one little coin that that will reward God or nature. A supposition like this is absurd in itself, and yet it is strictly implied in the theory of the economists who attribute to matter or the forces of nature some part of the value of the product. No, let me repeat, what has value is not bread; it is the series of services that have gone to make it available to me.

It is very true that, among all the constituent elements in the value of bread, our bookkeeper will encounter one that he will have trouble connecting with a service, or at least one requiring some effort. He will find that out of these 20 centimes, there are one or two that are the share of the landowner, the man who also owns, so to speak, the “laboratory” which is the farm. This small portion of the price of the bread constitutes what is called land rent and, led into error by the expression, by the metonymy that we find again here, our accountant will perhaps be tempted to believe that this share relates to natural resources or to the soil itself.

I maintain that, if he is clever, he will discover that this is once again the price for genuine services of the same kind as all the others. This is will be made clear in the arguments we will present when we deal with Private property in land.[481] For the moment, I will draw to the reader’s attention (to the fact) that I am not dealing here with property, but with value. I am not seeking to find out whether all services are genuine and legitimate, and whether people have managed to have themselves paid for services they do not provide. Good heavens! The world is full of injustices like this, among which rent should not be included.[482]

All that I have to demonstrate here is that the alleged value of things is only the value of the services, whether real or imaginary, that are received and rendered in connection with them. Value is not in the things themselves, no more in bread than in diamonds, water, or air. No part of the payment for these things goes to nature; payment in its entirety is distributed by the final consumer to people, and can be so made to them only because they have rendered him services, except in the case of fraud or violence.

Two men[483] judge that ice is a good thing in the summer and coal better in winter. These products meet two of our needs; ice cools us down and coal keeps us warm. We should not tire of saying that the utility in these substances or things lies in certain physical properties, which suit our physical organs. We should also note that, among these properties, ones that physics and chemistry can count as their own, value is not to be found, nor anything similar. How then have we come to think that value lies in matter and is itself a material thing?

If our two men wish to satisfy themselves without coming to an agreement, each of them will work to store a double quantity of provisions. If they come to an agreement, one will go down the mine to obtain enough coal for two and the other (will) go up the mountain to bring back ice for two. However, in this case there will have been an agreement. The relationship (between) the two services exchanged has indeed to be determined. Account will be taken of all the circumstances: the difficulties to be overcome, the dangers to be met, the time to be wasted, the trouble to be taken, the skill to be used, the risks to be run, the possibility of obtaining satisfaction in some other way, etc. When (an) agreement is reached, the economist will say: The two services being exchanged have the same value;[484] in common parlance and by metonymy it will be said that this quantity of coal is worth that quantity of ice, as though value had moved physically into the two products. However, it is easy to see that if the common reference is good enough to express the results, the scientific expression alone reveals the truth of the causes.

Instead of two services and two people, an agreement may include a large number, substituting compound exchange for simple barter.[485] In this case, money will intervene to make it easier to carry it out. Do I need to say that the principle of value will be neither shifted[486] nor changed?

But I have to add one comment concerning coal. There may be just one mine in the country and one man may have seized control of it. If this is the case, this man will make the rules, that is to say, he will establish a high price for his services, or his alleged services.

We have not yet reached the question of right and justice, separating honest services from those that are fraudulent. That will come.[487] What is important right now is to consolidate the proper theory of value and strip it of an error with which economic science is infected. When we say: “What nature has made or given, it has made or given free of charge and consequently, this has no value,” the reply that is given breaks down the price of coal[488] or any other natural product (into its component parts). We can readily see that the greater part of this price relates to human services. One person has dug into the earth, another has drained the water, a third has extracted the fuel, and a fourth has transported it, and it is the sum of this work that constitutes, as is said, almost all its value. Nevertheless, there still remains a portion of value that does not correspond to any work or service. This is the price of the lifeless coal underground, still untouched, as we say, by any human labor. It constitutes the owner’s share, and since this portion of the value is not created by humans it has to be created by nature.

I reject such a conclusion and warn the reader that if he agrees with it in any way at all he will be unable to go any further in economic science. No, the action of nature does not create value, any more than the action of man creates matter. You have two alternatives: either the landowner has made a useful contribution to the final result and has rendered (a) genuine service, in which case the portion of value he has given the coal fits in with my definition, or else he has imposed himself as a parasite, in which case he has been wily enough to have himself paid for services he had not rendered, and the price of coal has been unduly increased. This circumstance clearly proves that an element of injustice has been introduced into the transaction, but it cannot overturn the theory to the extent of making it valid to say that this portion of value is material and is, like a physical element, a part of the free gifts of Providence. And this is the proof: if a stop is put to the injustice, if it exists, the corresponding value will disappear. It will certainly not happen if this value was inherent in matter itself and was created by nature.

Let us now move on to one of our most pressing needs, that of security.[489]

A certain number of people land on an inhospitable beach.[490] They start to work. But each of them is constantly distracted from his work by the need to defend himself from fierce animals, or even fiercer men. Apart from the time and effort he devotes directly to his defense, he employs a great deal in acquiring weapons and munitions for himself. People end up acknowledging that the total waste of effort would be infinitely less if a few of them gave up other work and took exclusive responsibility for (providing) this service. Those who have the most skill, courage and strength will be assigned to (do) this. They will train in an art that they will make their constant occupation, and while they watch over the safety of the community the community will obtain more satisfactions for all from work that is no longer interrupted than it loses through the reassignment of ten of its members. Consequently, the arrangement is confirmed. What can we see in this, other than a new form of progress in the division of labor leading to and requiring an exchange of services?

Are the services of these military men, soldiers, militia, or guards, as people variously call them, productive?[491] Very probably, since the arrangement has taken place only to increase the ratio of total satisfactions to the general effort.

Have they a value? They surely must have, since they are appraised, assessed, evaluated, and in the end paid for by other services with which they are compared.

The form in which this remuneration is stipulated, the method of subscription, the procedure by which the arrangement is discussed and concluded, none of this changes the principle. Is effort spared (for) some by (that of) others? Are satisfactions provided to some by others? If there are, there is an exchange, a comparison, and an evaluation of services; (thus) there is value.

In times of social difficulty this kind of service often has terrible outcomes. Since the very nature of the services demanded from this class of workers requires the community to place coercive power[492] in their hands, capable of overcoming all forms of resistance, it may happen that those to whom this force is entrusted, by abusing it, turn it against the community itself.[493] It may also happen that while taking from the community services which are proportional to the community’s need for security, they themselves create insecurity, in order to make their services more essential and, through very clever diplomacy they get their fellow-citizens (involved) in constant war.

All this has been seen (in the past) and will be seen again (in the future). The result, I agree, are huge disturbances in the just equilibrium of reciprocal services.[494] But such disturbances doe not imply any change to the basic principle and the scientific theory of value.

Just one or two more examples. I beg the reader to believe that I am aware, as much as he is, of how tiring and heavy going this series of hypotheses is, all providing the same kinds of evidence and leading to the same conclusion, expressed in the same terms. I hope he will understand that, while this procedure is not the most entertaining, it is at least the most certain way of establishing the true theory of value and thus clearing the route we will have to take.

We are in Paris.[495] In this huge metropolis a great number of desires are bubbling to the surface, and the city also has an abundance of means of satisfying them. A host of rich or prosperous people are devoted to industry, the arts, and politics, and in the evening they seek an hour of relaxation with some enthusiasm. Among the entertainments that please them the most, the first in line is to hear Rossini’s fine music[496] sung by Madame Malibran[497] or Racine’s admirable poetry[498] spoken by Rachel.[499] There are only two women in the entire world who are capable of providing these delicate and uplifting experiences, and unless we bring in torture, which would probably not be successful, we have to agree to their terms. Thus the services expected from Malibran and Rachel will have a high value. This explanation is very prosaic, but it is no less true.

Imagine that a wealthy banker, in order to gratify his vanity, has one of these great artists perform in his drawing room; he will then find out, by experience, that my theory is accurate in all respects. He is looking for a memorable satisfaction (of his needs) and seeks it with some zeal; only one person in the world can provide it for him. He has no means of persuading her other than by offering her a sizeable payment.

What are the extreme limits between which the transaction will fluctuate? The banker will go to the point where he prefers to deny himself the pleasure rather than pay for it; the singer to the point where she prefers the payment offered to not being paid at all. This point of equilibrium will determine the value of this special service, like all the others. It may be that, as in so many cases, custom sets this delicate point. Too much taste exists in fine society to haggle over certain services. It may even be that payment is gallantly disguised (in such a way) to hide the vulgar aspects of economic law. This law nonetheless overshadows this transaction as much as it does more commonplace ones, and value does not change its nature because experience or urbanity dispenses with discussing it at each meeting.

This explains the huge fortune that unrivalled artists are able to command. Another circumstance favors them. Their services are of such a nature that they are able to provide them to a host of people for the same effort. However huge an enclosure, provided that Rachel’s voice fills it, the soul of each of her audience is filled with the whole experience that an inimitable delivery can create. We can see that this is the basis of a new form of arrangement. Three or four thousand people who experience the same desire are able to come to an agreement and make a joint payment, and the total amount of the services that each person brings as a tribute to the great actress is in balance with the single service given by her to all of her audience simultaneously. That is value.

In the same way that a large number of spectators enter into an agreement to listen, several actors may agree to sing an opera or play in a drama. Entrepreneurs may intervene to spare the contracting parties a host of tiny ancillary agreements. The value multiplies, becomes more complicated, builds upon itself, and spreads out, but it does not change its nature.

Let us end with what are known as exceptional cases. They are the proof of good theories. When the rule is true, exceptions do not invalidate it, they confirm it.

Let us imagine an old priest[500] who walks along pensively, his stick in his hand, and breviary under his arm. How serene are his features!! How expressive his face! How inspired his gaze! Where is he going? Do you not see the steeple in the distance? The young incumbent at the village church is not confident enough in his own faculties and has called on the assistance of the old missionary. But prior to this a few arrangements had to be made. The preacher will of course find bed and board in the presbytery. But he has to live between one period of Lent and another; that is the law of the Commune. Therefore, the parish priest has called for a voluntary donation from the wealthy members of his parish, one that is modest but adequate, for the old pastor has not been demanding, and in answer to what was written to him on this subject, he replied: “Bread for me is what I need; an obole (penny) for the poor is my luxury.”

Thus the economic prerequisites have been secured, given (the fact) that this annoying political economy, slips into and interferes with everything, and I truly believe that it is political economy that said: “Nil humani à me alienum puto.” (Nothing human is alien to me.)[501]

Let us discuss this example a little (further) from the point of view that (particularly) concerns us.

Here we certainly have an exchange of services. On the one hand, an old man will devote his time, strength, talents, and health in instilling a little light in the minds of a small number of villagers and raising their moral level. On the other hand, some bread for a few days, a superb black cassock, and a new biretta are promised to the man of the good word.

But there is something else here. There is a plethora of sacrifices (which have been made). The old priest refuses everything not strictly necessary to him. Half of this meager pittance is handled by the parish priest and the other half by the Croesuses[502] of the village, who thereby take the burden from the backs of their brethren, who will nevertheless benefit from the preaching.

Do these sacrifices invalidate our definition of value? Not in the slightest. Each person is free to part with his effort only in accordance with the conditions that suit him. If people are easy about the conditions or even do not lay down any, what is the result? The service, while retaining its utility, loses its value. The old priest is persuaded that his efforts will find their reward elsewhere. He is not keen on their finding it here on earth. He doubtless knows that he is providing a service to his congregation by preaching to them[503] and also knows that his congregation is doing him the service of listening to him. It follows from this that the transaction is made on terms advantageous to one of the contracting parties,[504] with the full consent of the other. That is all. In general, exchanges of services are determined and evaluated in the light of self-interest. However, thank God, sometimes this occurs in the light of the principle of fellow-feeling. In this case, either we hand over to someone else a satisfaction which we had the right to retain for ourselves or we make an effort on his behalf that we might have devoted to our own needs. Generosity, self-sacrifice, and self-denial are natural impulses in us, which like many other circumstances influence the present value of a given service, but which do not change the general law of value.

In contrast with this reassuring example, I might cite some (others) that are quite different in character. In order for a service to have value according to the economic meaning of the word, that has an actual value,[505] it is not necessary for it to be genuine, conscientiously rendered, or useful. It needs only to be accepted and paid for by another service. The world is full of people who are able to get the public to accept and pay for services that are far from being of sound quality. Everything depends on the assessment made of them, and this is why morality will always be political economy’s best assistant.

Cheats succeed in gaining acceptance for an erroneous belief. They claim to be the messengers of heaven. At their will the gates of heaven or hell open. When this belief has firmly taken root, they say: “Here are some small pictures which we have endowed with the power of making those that carry them eternally happy. By letting you have one of these pictures we provide you with a huge service, so let us have some services in exchange.” Here a value has been created. It is based on a false reckoning, people will say, and rightly so.[506] This can also be said of a great many material things that have a sure value, since they would have takers if they were put out to auction. Economic science would not be possible if the only values it accepted were those that had been judiciously appraised. At each step it would have to repeat a lecture on physical and moral science. Living in isolation, a man may, because of depraved desire or a misguided mind, pursue an illusionary or disappointing satisfaction with great effort. In the same way, in society it may happen, as a philosopher once said,[507] that we purchase something we regret at a very high price. If it is in the nature of the human mind to have a greater propensity for truth than error, all these frauds are fated to disappear, and all these fictitious services fated to be refused, all fated to lose their value. Civilization will put everything and everybody in their (proper) place in the long run.

Nevertheless, we have to bring this over-long analysis to an end. We have sought value everywhere, in the need to breathe, drink, and eat, the needs arising from vanity, intelligence, courage, public opinion, and hopes, whether well-founded or illusionary; we have identified it wherever it exists, that is to say, everywhere where there is an exchange of services. We have found it everywhere the same as it always was, based on a principle at once clear, simple, and absolute, although influenced by a host of varied circumstances. If we had reviewed all of our other needs and summoned joiners, masons, manufacturers, tailors, doctors, bailiffs, lawyers, traders, painters, judges, and the president of the republic,[508] we would not have found anything else: often material things, and sometime the forces supplied free of charge by nature, but always human services being exchanged for one another and being measured, estimated, assessed, and evaluated one against the other, and revealing on their own the result of this evaluation, or value.

Yet there is one of our needs, of a highly specialized nature, that is the cement of society and the cause and effect of all our transactions, the eternal problem of political economy, about which I have to say something here: I am referring to the need to exchange.

In the preceding chapter, we described the wonderful effects of exchange. They are such that people are bound to feel the natural urge to facilitate it even at the cost of great sacrifice. This is the reason there are roads, canals, railways, wagons, ships, traders, merchants, and bankers, and it is impossible to believe that, just to facilitate exchange,[509] the human race would have subjected itself to such an enormous strain on its powers if it did not find in that exchange wide-ranging rewards.

We have also seen that simple barter could give rise only to highly inconvenient and very limited transactions.

This is why people conceived the idea of splitting barter into two processes: sale and purchase, using an intermediate product, one easily divisible and above all possessing value, and bearing therefore the credentials for public confidence, namely money.[510]

What I want to draw attention to here is that what is called, either by ellipsis or metonymy, the value of gold and silver, rests on the same principle as the value of air, water, diamonds, the sermons of our old missionary, or the arpeggios of Malibran, that is to say, on (the) services rendered and received.

In fact, gold (like) that scattered on the lucky banks of the Sacramento River[511] possesses many precious qualities (which come) from nature: its malleability, weight, sparkle, brilliance, and even its utility, if you like. However, there is one thing that nature has not given it, because it is not nature’s business, and that is value. A man knows that gold meets a widely felt need and is greatly desired. He goes to California to look for gold, just as my neighbor went to the spring a short time ago to look for water. He devotes considerable effort, he digs, uses a pickaxe, washes (away the soil), and melts (the ore), and then comes and says to me: “I will do you the service of handing over this gold to you; what service will you do me in return?” We discuss the matter, and each weighs up all the circumstances that may affect it. Finally we come to an agreement, and lo and behold, we have value, which has been made manifest and settled upon. Led astray by the abbreviated expression, “gold is worth such and such," we might well believe that the value is as much in the gold as weight and malleability, and that nature has taken care to put it there. I hope that the reader is now persuaded that this is a misunderstanding. Later, he will be persuaded that it is a deplorable misunderstanding.

There is another misunderstanding relating to gold or rather to money. Since money is the usual intermediary in all transactions, the middle part between the two elements of a compound barter, and it is always to its value that the value of the two services being exchanged is compared, it has become the measure of value. In practical terms, this could not be otherwise. However, economic science should never lose sight of the fact that money is subject to the same fluctuations as any other product or service, as far as value is concerned. Economics often forgets this, which is not surprising. Everything seems to contribute to the view that money is the measure of values just as the liter is the measure of volume. It plays a similar role in transactions. We are not aware of its own fluctuations because the franc, like its multiples and sub-multiples, always keeps the same name. Finally the arithmetic itself conspires to propagate confusion by classifying the franc as a form of measurement with the meter, the liter, the hectare,[512] the cubic meter, the gram, etc.

I have defined value, at least in the way I see it. I have submitted my definition to the proof of a very diverse set of facts; none, it seems, has made a lier of me. Finally, the scientific meaning I have given this word has combined with the commonly accepted meaning, which is no mean advantage nor an insignificant guarantee, for what is systematic knowledge if not reasoned experience? What is theory but the methodical exposition of universal practice?

I must now be allowed to cast a rapid glance at the explanatory theories that have been in force up to now. It is not in a spirit of controversy, and still less of criticism, that I undertake this examination, and I would willingly abandon it if I were not persuaded that it can shed new light on the fundamental thinking behind this chapter.

We saw that writers had sought the principle of value in one or more of the accidental features that influence it markedly: materiality,[513] durability, utility, rarity, labor, etc., just as a physiologist might look for the principle of life in one or more of the external phenomena that makes it possible, namely in air, water, light, electricity, etc.

Materiality. (Physical Composition).

“Man," says Mr. de Bonald, “ is a mind served by organs."[514] If the economists of the materialist school had simply meant to say that people were able to render each other (reciprocal) services only through their bodily organs, in order to conclude from this that there is always a material aspect to these services and consequently to value, I would go no further, having a horror of etymological disputes and those subtleties with which the mind only too often appears to be teeming.

But this is not how they have understood matter. What they believed is that value is communicated to matter, either by human labor or by the action of nature. In a word, misled by the elliptical expression: the value of gold is so much, the value of wheat is so much, they have been led to see in matter a quality called value just as a physicist sees density or weight, and yet these attributes in it are contested.

Be this as it may, I formally deny that value lies in matter.

First of all, it cannot be denied that matter and value are often separated. When we say to someone: “Take this letter to this address, go and fetch me some water, teach me this science or this industrial process, give me some advice on my illness or my legal case, take care of my security while I work or sleep,” what we are demanding is a service and we recognize a value in this service universally, since we voluntarily pay for it with an equivalent service. It would be strange if the theory refused to accept what universal agreement accepts in practice.

It is true that our transactions often involve physical objects, but what does that prove? That people, through foresight, are prepared to provide services that they know will be demanded. Whether I buy a ready-made suit or ask a tailor to come to my house to work for a daily rate, how does this change the principle of value, especially concerning the degree to which it is thought to reside sometimes in the suit (itself) and sometimes in the service?

We might ask the following subtle question at this point: Should the principle of value be seen in physical objects, and thus by analogy attributed to the services? I say it is the other way round: it should be recognized in services and then attributed, by metonymy if you like, to physical objects.[515]

Anyway, the many examples I have given the reader in the way of examining the problem, make it unnecessary for me to continue this discussion any longer. However, I cannot refrain from justifying my having brought it up by showing the dire consequences to which an error, or if you prefer an incomplete truth, can lead, when it is held as a given at the starting point of a theoretical account.

(Not) the least disadvantage of the definition that I am combating has been (the way it has) curtailed and butchered political economy. If value lies in matter, where there is no matter there is no value. The Physiocrats categorized three quarters of the population as (belonging to the) sterile classes[516] and Smith, softening the expression somewhat), called them the unproductive classes.[517]

And since, at the end of the day, facts speak louder than definitions, it was essential, by one means or another, to reintegrate these classes (back into) in the field of economic science. This was done through analogy, but the language of that science, based on different data, was already materialistic, to the point of making this extension startling. What do the following concepts mean: “To consume a non-material product. Man is an accumulation of capital. Security is a tradable good, etc. etc.”?

Not only was the language excessively materialist, but people were also reduced to overloading it with subtle distinctions in order to reconcile ideas that had been wrongly separated. The concept “use-value[518] was dreamed-up and contrasted with “exchange value” etc.[519]

Finally, and this is much more serious, because of the confusion of two major social phenomena, private property and what is common to all, the first remained unjustifiable and the second undefinable.

In fact if value resides in matter, it is combined with the physical qualities of the objects that make them useful to man. Well, these qualities are often put there by nature. Thus, nature contributes to creating value and here we are, attributing value to what is free of charge and by definition common to all.[520] Where then is the basis of (private) property? When the payment for what I am handing over in order to acquire a physical product, wheat, for example, is distributed to all the workers who have provided me with a service in one way or another in respect of this product, to whom does the share of this payment that corresponds to the share of value due to nature and distinct from man, go? Does it go to God? Nobody claims this, and we have never seen God claiming his payment. Does it go to a person? By what right, since ex hypothesis he has done nothing?

And let nobody think that I am exaggerating when, in the interest of my definition, I take the strict consequences arising from the economists’ definition to the limit. No, they themselves have clearly drawn these consequences under the pressure of logic.

Thus, Senior went so far as to say:

“Those who have taken possession of the natural resources receive a reward in the form of rent without having made any sacrifices. Their role is limited to holding out their hands to receive the offerings of the rest of the community.”[521]

Scrope said:

“Ownership of the land is an artificial restriction placed on the enjoyment of the gifts that the Creator intended for the satisfaction of the needs of all.”[522]

Say said:

It would seem that agricultural land ought to be included as part of natural wealth since they were not created by men, but were given to them free of charge by nature. But since this wealth is not fleeting, like water or air, since a field is a fixed and bounded space which men are able to appropriate for themselves and exclude all others who have given their consent to this act of appropriation, land, which was a natural and gratuitous good (bien), became a form of social wealth the use of which ought to be paid for.[523]

Certainly, if this is so, Proudhon is justified in asking this terrible question, followed by an statement that is more terrible still:

“To whom is farm rent for the land due? Doubtless to the producer of the land. Who has made the land? God. In this case, landowner, get out.”[524]

Yes, because of a bad definition, political economy has placed logic on the side of the communists. I will shatter this dreadful weapon in their hands, or rather they will be happy to hand it over to me. None of the consequences will remain once I have eliminated the premise. And I lay claim to demonstrating that if, in the production of wealth, the action of nature works in harness with the action of man,[525] nature’s action being free of charge and by definition common to all, continues to be free and common to all through all of our transactions, and the action of man merely represents services and value, and value alone is rewarded. Value alone is the basis, explanation, and justification of (private) property. In a word, I claim that, relative to each other, men merely own the value of things, and when products pass from hand to hand, the conditions they set in their bargaining refer solely to value, that is to say, to the mutual services (they render), (thereby) giving each other into the bargain all the qualities, properties, and utilities that these products have been given by nature.

If, up to now, political economy, by overlooking this fundamental consideration, has undermined the guardian principle of (private) property, putting it forward as an artificial institution that is necessary but unjust, by the same token it has left in darkness, completely unnoticed, another admirable phenomenon, the most touching gift of Providence to his creation, namely the phenomenon of the expanding Commons.[526]

Wealth, taking the word in its general meaning, results from the combination of two actions, one by nature and the other by man. The first is free of charge and common to all according to Providential intent, and never loses this character. The second alone is imbued with value, and consequently subject to being owned (appropriated). Yet, following the development of (our) minds and the progress of civilization, the contribution of the first to the creation of any given utility is constantly increasing, while the contribution by the second is constantly decreasing, from which it follows that the domain of gratuitousness and the Commons[527] is expanding continually within the heart of the human race in proportion to the domain of value and (private) property. This is a fruitful and reassuring glimpse that is lost sight of to (economic) science as long as science continues to attribute value to the cooperation of nature.

In all the religions, God is thanked for his benefits. Heads of households bless the bread that they break and distribute to their children, a touching custom that could not be justified by reason if there were nothing free in the bounty of Providence.

Durability

This alleged condition, the sine qua non of value, is linked to the condition I have just discussed. In order for value to exist, thought Smith, it has to be inherent in something that can be exchanged, accumulated, and preserved, and consequently in something material.

There is one sort of labour which adds[528] to the value of the subject upon which it is bestowed: there is another which has no such effect. …

But the labour of the manufacturer fixes and realizes itself in some particular subject or vendible commodity, which lasts for some time at least after that labour is past. … The labour of the menial servant, on the contrary, does not fix or realize itself in any particular subject or vendible commodity. His services generally perish in the very instant of their performance, and seldom leave any trace or value behind them …[529]

We see that here value relates rather to the modification of things than to the satisfaction (of the needs of) of people. This is a profound error, for if it is a good thing for objects to be modified, it is solely in order to achieve the satisfaction that is the goal, the aim, the consummation of all effort. Therefore, if we achieve it through an immediate and direct effort, the result is the same. Furthermore, if this effort can be the subject of transactions, exchanges, or evaluation, it encapsulates the principle of value.

As for the period of time that may pass between the effort and the satisfaction (of the need), indeed Smith gives it too much weight when he says that the existence or non-existence of value depends on this. “The value of a saleable item,” he says, “lasts at least for some time.” Yes, this may be so, it lasts for as long as this item has fulfilled its purpose, which is to satisfy a need, and this is exactly the same for a service. As long as this dish of strawberries stays in the sideboard it will keep its value. Why? Because it is the result of a service that I wanted to give myself or that others have given me for payment and that I have not yet made use of. As soon as I have done so by eating the strawberries, the value will disappear. The service will vanish and will leave no trace of value in its wake. This is exactly like personal service. Its consumer causes its value to disappear, for it has been created with this sole aim. It is of little importance to the notion of value whether the trouble taken today satisfies the need immediately, tomorrow, or in a year’s time.

Now, let’s say that I am afflicted with a cataract. I call on an eyer doctor. (According to Smith) the instrument he uses will have value because it lasts a long time, but the operation has none, even though I pay for it, have discussed its price, and sought out the prices of his competitors? That is contrary to the most customary events or the notions most unanimously acknowledged, and what sort of theory is it that, since it cannot account for universal practice, holds it as not having occurred?

I beg you to believe, reader, that I am not letting myself be carried away by an undue love of controversy. If I insist on these elementary notions, it is to prepare your mind for consequences of the utmost seriousness that will become evident later. I do not know whether the laws of method will be violated by allowing myself to give you a sense of these consequences in advance, but I am allowing myself this slight breach (of etiquette) because I am afraid that you will lose patience. This is what led me earlier to talk to you prematurely about (private) property and what is common to all. For the same reason, I am going to say something about capital.[530]

By basing wealth in matter, Smith could envisage capital only as an accumulation of material objects. How then can value be attributed to services that cannot be accumulated or stock piled?

In the first place under the heading of capital are ranked tools, machines, and equipment for work. They are used to harness the forces of nature to the work of production, and since the ability to create value has been attributed to these forces, people were led to believe that the tools of work were, on their own, endowed with the same ability independently of any human service. Thus, spades, ploughs, and steam engines were thought to contribute simultaneously with natural resources and human forces to the creation, not only of utility, but of value as well. But all value is paid for in the the act of exchange. To whom then should this portion of value that is independent of all human service be allocated?

This is how the Proudhon school, after having opposed land rent, came to oppose interest on capital, a much wider thesis since it encompasses the other.[531] I maintain that Proudhon’s error, from the scientific point of view, is rooted in Smith’s error. I will show that capital, like natural resources, considered in itself in terms of what it does, creates utility, but never value. Value is essentially the fruit of a legitimate service. I will also demonstrate that, in the social order, capital is not an accumulation of material objects arising from the durability of material things, but an accumulation of values, that is to say, of services. In this way, this recent campaign against the productivity of capital will be destroyed, at least to all intents and purposes as well as for its lack of a raison d’être, and to the satisfaction of the very people who started it, for if I prove that nothing happens in the world of trade other than the mutual exchange of services, Mr. Proudhon ought to acknowledge that he has been defeated by his own principle.[532]

Labor

Adam Smith and his disciples have assigned the basis of value to labor, on the grounds of materiality. This contradicts the other view, that the forces of nature play some part in the production of value. This is not the place for me to campaign against those contradictions which appear with all their disastrous consequences, when these writers talk about land rent or interest on capital.

Be that as it may, when they locate the basis of value in labor, they would be very close to the truth if they did not concentrate their attention on manual work. Indeed, I said at the start of this chapter that value must relate to effort, an expression that I preferred to labor as more general and which embraces the entire sphere of human action.[533] But I was quick to add that value could arise only from efforts or reciprocal services which were exchanged, because it is not something that existed independently but a relationship (between the two).

Strictly speaking therefore, there are two flaws in Smith’s definition. The first is that it takes no account of exchange, without which value can be neither produced nor (even) conceived. The second is that it uses a word that is too narrow, labor, unless this word is given an extension almost no one uses, by incorporating into it notions, not only of intensity and duration, but of skill, insight, and even of more or less good luck.

Note that the word service, which I substitute in the definition, removes these two defects. Of necessity, it implies the idea of (a) transfer (from one person to another), since a service cannot be rendered if it is not received, and it also implies the idea of an effort, without assuming that the value will be proportional to it.

And above all, this is where the definition of the English economists falls down. To say that value lies in labor is to lead our mind to think that these two concepts serve as a reciprocal form of measurement, and that they are proportional to each other. In this their definition is contrary to the facts, and a definition that is contrary to the facts is a faulty definition.

Very frequently, a piece of work that is considered insignificant in itself is accepted in the world as having a huge value (examples of this are diamonds, the song of a prima donna, a few strokes of a banker’s pen, the fortunate speculation of a ship owner, a brush stroke from a Raphael, a plenary indulgence (from a priest), the undemanding role of the Queen of England,[534] etc.). Even more frequently, work requiring unrelenting and arduous labor merely results in disappointment or some thing of no value. If this is so, how can a correlation be established, or a proper proportion between value and work?

My definition solves this difficulty. It is clear that there are circumstances in which a great service can be rendered with little trouble; others in which, after one has taken a great deal of trouble, it becomes apparent that this has done no service to anyone, which is why it is more accurate to say, once more, that value lies in the service rather than in the labor, since it is in proportion to the former rather than to the latter.

I will go further. I maintain that value is estimated at least as much by the labor which the person receiving the service is saved as by the work done by the person providing it. Will the reader be so good as to recall the dialogue between (the) two contracting parties on the subject of a precious stone (which I presented above)?[535] It did not arise from an accidental circumstance, and I am bold enough to say that it is the tacit foundation of all transactions. We should not lose sight of the fact that we are assuming that the two contracting parties are totally free and in full possession of their will and judgment. Each of them bases his acceptance of the exchange in the light of numerous considerations, among which there certainly figures prominently the difficulty for the person receiving it, of obtaining the satisfaction being offered to him, directly by himself. Both of them have their eyes set on this difficulty and take account of it, the first to be more or less willing and the other to be more or less demanding. The trouble taken by the person providing the service also has an influence on the agreement; this is one of its elements, but not the only one. It is therefore not accurate to say that value is determined by labor. It is determined by a host of considerations, all included in the word “service.”

What is very true is that, because of the effect of competition, values tend to be in proportion to efforts, and rewards to merit. This is one of those fine harmonies of the social order. But with regard to value, this equalising pressure exercised by competition is totally external, and in all logic the influence of an external cause on a phenomenon cannot be confused with the phenomenon itself.[536]

Utility.

Unless I am mistaken, J. B. Say was the first to shake the yoke of materiality. He very deliberately made value into a moral quality, an expression that may exceed the goal, for value is not really either physical or moral but simply a relationship.

Yet the great French economist himself had said: “It has been given to nobody to reach the boundaries of science. Scholars climb on one another’s shoulders to scan the horizon as it extends ever wider.”[537] Perhaps the great reputation of Mr. Say (with regard to the particular question we are dealing with, for in other respects his titles to glory are as numerous as they are imperishable) is to have bequeathed to his successors a fertile insight.

Mr. Say’s axiom was this: The basis of value is utility.

If the question here were the relative utility of human services,[538] I would not disagree. The most I might do would be to note that the axiom is superfluous because it is so obvious. It is very clear actually that nobody would agree to pay for a service unless, rightly or wrongly, he considered it to be useful. The word service encapsulates the idea of utility so profoundly that it is nothing other than the translation into French and even the literal reproduction of the Latin word, uti, to serve.

But unfortunately this is not how Say understood it. He found the principle of value not only in human services carried out on things as required but also in the useful qualities placed by nature in things themselves. In this, he submitted to the yoke of materiality. In this, it has to be said, he was far from tearing down the disastrous veil that the English economists had cast over the question of property (rights).

Before discussing Say’s axiom in itself I ought to make clear its logical range, so that I am not criticised for leaping into onerous discussions and dragging the reader with me.

There can be no doubt that the utility spoken of by Say is the utility inherent in things. If wheat, wood, coal, and woolen cloth have value, it is because these things have qualities that make them suitable for our use, and (that) will satisfy our need to feed, heat and clothe ourselves.

This being so, just as nature creates utility, it creates value, a disastrous confusion that the enemies of property have made into a terrible weapon for themselves.

Take a product, wheat, for example. I buy it at the exchange for sixteen francs. A major portion of these sixteen francs is distributed, through an infinite series of ramifications, and an inextricably complicated set of advance payments and repayments, among all the men who, in one way or another, have contributed to bringing this wheat to me. There is something for the farmer, the sower, the harvester, the flayer, and the cart driver, as well as for the blacksmith and wheelwright who prepared the tools. So far, there is no comment to make, whether you are an economist or a communist.

But I notice that four out of my sixteen francs go to the landowner, and I have every right to ask whether this man, like all the others, has provided me with a service to entitle him like all the others to an undeniable right to a payment.

In line with the doctrine that this article hopes to put forward, the reply is clear. It is a formal yes. Yes, the landowner has provided me with a service. What service? This one: He has, either personally or through an ancestor, cleared and fenced the field. He has removed the weeds from it and drained stagnant water. He has made the layer of topsoil deeper and built a house, cowsheds, and stables. All of this implies a lengthy period of work, which he has carried out personally or, and this is one and the same thing, he has paid others to do. These are certainly services which, by virtue of the just law of reciprocity, have to be reimbursed. Well, this landowner has never been paid, at least not in full. He could not be totally paid by the first person that came to buy a hectoliter of wheat from him. What, then, is the arrangement that has occurred? Certainly the most ingenious, the most legitimate, and the most equitable imaginable. It consisted in this: Whoever wants to obtain a sack of wheat will pay, in addition to the services of the various workers we have listed, a small portion of the services provided by the landowner. In other words, the value of the services of the landowner will be spread over all the sacks of wheat that leave this field.

Now it may be asked whether this payment, assumed here to be four francs, is too large or too small. My reply is that this does not concern political economy. Economic science merely confirms that the value of the services of the landowner is totally governed by the same laws as the value of any other service, and that is enough.

We may also be surprised that this system of parceling out repayments does not in the end come to a total amortization, and consequently to the extinction, of the landowner’s right to property. The people who bring up this objection do not know that it is in the nature of capital to produce perpetual rent, as we will be learning later.

For the moment I must not digress from the question any longer and I will note (for this is the nub of the matter) that there is not an obole/penny[539] of my sixteen francs that does not go to repaying human services, and not one that corresponds to the alleged value that nature is said to have put into the wheat by making it useful.

If, however, following the axiom of Say and the English economists, you say that out of the sixteen francs, twelve go to the ploughmen, sowers, harvesters, cart drivers, etc., two pay for the personal services of the landowner and, in the end, the other two francs represent the value that is based on the utility created by God through natural resources and distinct from any human co-operation, do you not see that you will be immediately asked: “Who ought to benefit from this portion of value? Who has the right to this payment? God does not come forward to receive it. Who will be bold enough to step forward in his place?”

And the more Say wishes to explain the correctness of this statement, the more he lays himself open to his opponents. First of all, he compares, rightly, the earth to a laboratory in which chemical operations are carried out whose results are useful to the human race. “The soil," he adds, “is thus the producer of a form of utility, and when it (the soil) has this utility paid for in the form of a profit or farm rent for the landowner, this is not without giving something to the consumer in exchange for what the consumer pays it (the soil). It (still the soil) provides the consumer with a utility that has been produced and it is in producing this utility that the earth is productive just as labor is.”[540]

Thus, the statement is clear. Here are two claimants that have come forward to share the due payment by the consumer of the wheat, namely, the earth and human labor. They come forward with the same credentials since the soil, as Mr. Say says, is productive just as labor is. Labor demands to be paid for a service; the soil demands to be paid for a utility, and it does not demand this payment for itself (in what form could we make it?), it demands it for its landowner.

At which stage, Proudhon summons the landowner who claims to be responsible for the powers of the soil to show his legal claim.

People want me to pay, in other words they want me to provide a service, to receive the utility produced by natural resources, quite apart from the contribution already made by the people who have already been paid separately.

Yet I will still ask: “Who benefits from my service?”

Will it be the producer of the utility, that is to say, the soil? That is absurd, and I can wait with peace of mind for it to send me a bailiff (to enforce its claim).

Will it be a man? On what grounds? If it is for having rendered a service, fine! But then you agree with me. It is the human service that has value and not the service of nature. That is the conclusion to which I want to bring you.

Nevertheless, this is contrary to your very hypothesis. You say that all the human services have been paid for by the fourteen francs and that the two outstanding francs in the price of the wheat are for the value created by nature. In this case, I repeat my question: On what grounds can any man come forward to receive them? And is it not unfortunately only too clear that if you applied the name of landowner specifically to the man who claims the right to receive these two francs, you are justifying this only too famous maxim: Property is theft?[541]

And let it not be thought that this confusion between utility and value is limited to undermining the ownership of land. After having led to the opposition to land rent, it leads to the opposition to interest on capital.

In truth, machines and the tools of work are, like the soil, producers of utility. If this utility has a value, it is paid for, for the word value implies the right to payment. But to whom is it paid? To the owner of the machine it would seem. Is this for a personal service? In this case, you have to say therefore that the value lies in the service. But if you say that an initial payment has to be made for the service and a second for the utility produced by the machine, independently of all the human action[542] that has already been paid for, you will be asked to whom this second payment goes, and how the man who has already been paid for all his services has any right to claim anything more?

The truth is that the utility produced by nature is free of charge and therefore common to all, just as the utility produced by the tools of work is. It is free and common to all on one condition: you have to go to the trouble of providing the service which you receive yourself, or if you hand over the trouble to be taken (to someone else), if you demand this service from others, you must return an equivalent service to them. It is in these relative services that value lies, and not at all in natural utility. The trouble taken in question may be more or less great, and this causes value to vary but not utility. When we are close to an abundant spring, the water is free of charge to all on condition that we bend down to take it. If we ask our neighbor to do this for us, I then see an agreement appearing, a deal,[543] a value, but that does not alter the fact that the water remains free of charge. If we are an hour’s distance from the spring, the deal will be made on other terms with regard to the degree of (the effort made), but not with regard to the principle. The value will not have passed into the water or its utility for all that. The water will continue to be free of charge, on condition that you go to collect it or pay those who, following a free negotiation, agree to spare us this trouble by taking it on themselves.

The same principle applies to everything. Utility surrounds us, but we have to bend down to gather it. This effort is sometimes very easy, but often very complicated. In most cases, nothing is easier than collecting water, whose utility has been prepared by nature. It is not so easy to gather wheat, whose utility has also been prepared by nature. This is why the value of these two efforts differs in degree, but not in principle. The service is more or less onerous, and therefore its value is more or less; its utility is and will always remain free of charge.

If a (work) tool comes into the picture, what happens? Utility is more easily gathered. Therefore the service has less value. We certainly pay less for books since the invention of printing. This is an admirable and only too little recognized phenomenon! You say that the tools of work produce value; you are mistaken, for it is of utility and gratuitous utility that you should speak. As for value, they produce so little of it that they increasingly eliminate it.

It is true that the person who manufactured the machine has provided a service. He receives a payment which increases the value of the product. This is why we are apt to think that we are paying for the utility produced by the machine, but this is an illusion. What we are paying for are the services that are provided by all those who have contributed to manufacturing it or operating it. The value is so little in the utility produced that even after having paid for these new services, we acquire the utility on better conditions than before.

Let us therefore get into the habit of distinguishing utility from value. This is the price[544] we have to pay to have a science of economics. I dare to state, without fear of going so far as to be paradoxical, that utility and value, far from being identical or even capable of being merged into one, are opposing ideas. Need, effort and satisfaction, this, as we have said, sums up man from the economic point of view. Utility is related to need and satisfaction. Value is related to effort. Utility is the good that causes need to cease through satisfaction. Value is the harm, for it arises from the obstacle that comes between need and (the) satisfaction (of need). Without such obstacles, there would be no effort to be made and exchanged, utility would be infinite, free of charge, and unconditionally common to all and the notion of value would never have been introduced to the world. Because of the presence of these obstacles, utility is free of charge only if efforts are exchanged, and these, when compared with each other, establish the value. The more the obstacles disappear in the face of nature’s bounty or the progress of science, the closer utility comes to a condition of absolute gratuitousness and being common to all, for the onerousness of the (our) condition, and consequently the value, decreases with the obstacles. I would consider myself happy if, through all this eloquence, which may appear subtle and whose combined length and concision I am condemned to dread, I succeeded in establishing this reassuring truth: (that there exists) the legitimate ownership of value, and another comforting truth, namely the the expanding Commons of useful things.[545]

I will add just one more comment: Everything that serves a purpose is useful (Latin “uti,” to serve). From this point of view, it is highly doubtful whether there is anything in the universe, whether force or matter, that is not useful to man.

At least we can state without fear of being mistaken that a host of things are useful to us without our knowing it. If the moon had been further away or closer to us, it is very possible that the mineral kingdom and, following that, the vegetable kingdom, and later the animal kingdom, would have been profoundly different. Without this star that is shining in the firmament as I write, perhaps it would not have been possible for the human race to exist. Nature has surrounded us with useful things. We recognize this quality of being useful in a host of substances and phenomena; science and experience reveal usefulness in others to us every day. In yet others, it exists even though we are totally unaware of it, and perhaps will always be so.

When these substances or phenomena exercise their useful function over us without our intervention, we have no interest in comparing the degree of their usefulness to us, and what is more we do not really have the means to do this. We know that oxygen and nitrogen are useful to us, but we do not try, and if we did it would probably be in vain, to determine in what proportion. There are no elements to evaluate them, to give them a value. I would say the same thing of chemical compounds, gases, and the forces that exist everywhere in nature. When all these natural resources move and combine so as to be useful to us, without our doing anything, we enjoy this usefulness without attributing a value to it. It is when our co-operation intervenes, and especially when it is exchanged, that then and only then evaluation and value appear, not because of the usefulness of substances and phenomena which are often often ignored, but because of this (act of) co-operation itself.

This is why I say: Value is the evaluation of the services (which are) exchanged. These services may be highly complicated. They may have required a host of various forms of work, both in the past and the present, and be transmitted from one hemisphere to another or from one generation to another, encompassing a crowd of contracting parties, requiring credit arrangements, advance payments, and a variety of agreements, until a general balance is achieved; nevertheless, it remains true that the basis of value is in (the) services, and not in the usefulness of which they are the vehicle, gratuitous utility by definition, and that goes from hand to hand into the bargain, if you will let me put it that way.[546]

In the end, if you persist in seeing in utility the basis of value, I will agree to this, but let it be clearly understood that it is not the utility that is inherent in things and phenomena through the dispensation of Providence or the power of technology, but the usefulness of human services that are compared and exchanged.

Scarcity.

According to Senior, of all the circumstances that influence value, scarcity is the most decisive.[547] I have no objection to make to this comment, other than that through its form it assumes that value is inherent in things themselves, a hypothesis that I will always combat as soon as it makes an appearance. Basically, the word scarcity, in relation to the subject that concerns us, expresses pithily the following thought: All other things being equal,[548] a service has all the more value when we have more difficulty in procuring it for ourselves, and consequently we encounter more demanding terms when we ask others to do it (for us). Scarcity is one of these difficulties. It is one more obstacle to be overcome. The greater the obstacle the more we pay those who overcome it on our behalf. Scarcity often gives rise to considerable payment, and this is why I refused just now to accept, along with English economists, that value is proportional to the work. You have to take account of the frugality with which nature has treated us in certain respects. The word service embraces all these ideas and (different) shades of ideas.

(Individual) Judgment.

Storch sees value in the judgment that enables us to recognize it. Doubtless, each time that it is a question of a relationship, you have to compare and come to a judgment. However, the relationship is one thing and the judgment (is) another. When we compare the height of two trees, how tall they are and the difference in their heights are things independent of our judgment.

However, in determining value, what is the relationship that we should be assessing? It is the relationship (between the) two services being exchanged. The question is to know the value of the services given and received in relation to each other at the time the acts are done, or the items handed over, taking all the circumstances into account, and not whether these acts or (things) have any intrinsic utility, because this utility may in part be extraneous to any human action[549] and therefore extraneous to their value.

Storch therefore continues to make the fundamental error that I am combating here when he says:[550]

“Our judgment enables us to discover the relationship that exists between our needs and the utility of things. … The verdict that our judgment brings to bear on the usefulness of things constitutes their value.”[551]

And later:

“… To create a value, three circumstances have to come together: 1. The person has to feel a need or conceives of a need; 2. Something exists which can satisfy this need; 3. The person’s judgement decides in favour of the utility of the thing. Therefore the value of things lies in their relative usefulness … [552]

In the daytime I need to (be able to) see clearly. There is something that can meet this need, and that is sunshine. I judge this to be useful and … it has no value (price). Why? Because I enjoy it without the need to ask anyone for a service.

At night I have the same need. There is something that can meet this need very inadequately, a candle. I judge this thing to be useful, but relatively much less useful, and it has a value. Why? Because the person who took the trouble to make a candle has no wish to do me the service of giving me the candle without my providing him with an equivalent service.[553]

In determining value, what we have to compare and judge is therefore not the relative usefulness of things but the relationship between the two services.

In this respect, I do not reject Storch’s definition.

Let us sum up this paragraph in order to show that my definition contains everything that is true in the definitions of my predecessors and discards all that is erroneous by excess or default.

The principle of value, as I have said, lies in a service provided by a human being. It results from the judgment of (the) two services compared.

Value has to relate to effort; service implies some sort of effort.

It assumes a comparison of (the) efforts exchanged, or at least (which might be) exchangeable. Service implies the words (to) give and (to) receive.

Nevertheless, value is not in fact proportional to the intensity of the effort; Service does not necessarily imply this proportionality.

A host of external circumstances affect value without being value itself. The word service takes account of all these circumstances as far as is reasonable.

Materiality. When the service consists in providing a material object, nothing prevents you from saying, using metonymy, that this thing has value. However, you should not lose sight of the fact that this is a figure of speech that attributes to objects themselves the value of the services to which they give rise.

Durability. Whether material or not, value lasts until satisfaction is achieved, and no longer. It does not change its nature depending on whether satisfaction follows effort more or less closely or whether the service is personal or general.

Capable of being accumulated. What saving accumulates in the social order is not material things but value or services.[554]

Utility. With Mr. Say, I will accept that utility is the basis of value, provided that it is agreed that it is not a question of the utility inherent in things but the relative utility of services.

Labor. With Ricardo, I will accept that labor is the basis of value, provided first of all that the word is taken in its most general sense, and next, that a proportionality (between labor and value) that is contrary to all the facts is not deduced (from this), in other words, provided that the word service is substituted for the word labor.

Scarcity. With Senior, I accept that scarcity influences value. But why? Because it makes the service all the more precious.

Judgment. With Storch, I accept that value is the result of a judgment, provided that it is a judgment that we bring to bear not on the utility of things, but on the utility of (the) services.[555]

In this way, economists of all shades ought to be satisfied. I admit that they are all right because all of them have glimpsed the truth from one side. It is true that the error was on the other side of the coin. It is up to the reader to decide whether my definition takes account of all forms of the truth and rejects all forms of error.

I must not end without saying a word about this squaring of the circle of political economy: the measurement of value, and here I will repeat with even greater force the comment that closed the preceding chapters.

I said that there was no precise boundary to or measurement of our needs, desires, and tastes.

I said that there was no precise measurement for our means of providing for them, the gifts of nature, our capacities, action, foresight, and discernment. Each of these elements is inherently variable, and differs from person to person, and in each person from minute to minute, so that all of this forms a whole which is changeability itself.[556]

If we now consider the circumstances that influence value, utility, labor, scarcity, and judgment, and if we acknowledge that there is none of these circumstances that does not vary infinitely, why do we stubbornly concentrate on seeking a fixed measurement for value?

It would be odd if we found a fixed (way of measuring something) in an average term made up of variable elements that are nothing other than a relationship between two extreme terms that are even more variable!

The economists who pursue an absolute measurement of value are therefore chasing an illusion and what is more, something useless. Universal custom has adopted gold and silver, even though it does not know to what extent the value of these metals varies. But what does it matter how variable the measurement is if, as it affects the two objects being exchanged in the same way, it cannot alter the fairness of the exchange? It is an average ratio that can rise or fall without failing in its mission of defining accurately the relationship of (the) two extremes.

Political economy does not set as its goal, as exchange does, the search for the current relationship between two services, for in this case money would suffice. What it is looking for above all is the relationship between effort and satisfaction, and in this respect a measure of value, if it existed, would not teach us anything, for effort always brings a variable proportion of gratuitous utility to satisfaction, and this has no value. It is because this element of well-being has been lost sight of that the majority of writers have deplored the absence of a (fixed) measure of value. They have not seen that this would not provide an answer to the question put forward: What is the wealth or comparative well-being of two classes, two nations, or two generations?

To answer this question economic science would need a measure that would show it, not the relationship between two services, which may bear markedly different amounts of gratuitous utility, but the relationship between effort and satisfaction and this measurement could not be anything other than the effort itself, or labor.

But how can labor be used as a measure? Is it not itself one of the most variable elements? Is it not more or less skilled, painful, chancy, dangerous, or repugnant? Does it not require more or less contributions from particular intellectual capacities or certain moral virtues? And does it not lead to payment that varies infinitely because of all these circumstances?

There is one form of work that has remained identical at all times and everywhere, and this ought to serve as a benchmark. This is the simplest form of work, the roughest and most primitive, the one that requires the most muscles and is most free of natural co-operation, the one that anyone can do, and that provides services that anyone can get for himself, that requires no exceptional strength, skill, nor apprenticeship; the form of work that occurred at the start of the human race, in a word, the work of a simple day laborer. This type of work is the most (readily) available, the least specialized, the most homogeneous, and the least paid. All pay scales are established and graded on this basis and increase in line with all the circumstances that add to its worthwhile character.

Therefore, if we wish to compare two social states, we should not have recourse to a (fixed) measure of value, for two reasons equally logical: first of all because none exists; and furthermore because it would give a misleading reply to the question, omitting a progressively increasing element in human well-being, namely gratuitous utility.

What should be done is, on the contrary, to overlook value completely, in particular money, and the question asked should be: in a particular country and at a particular time, what is the quantity of each type of special utility and what the sum of all the utilities that together meet each given quantity of unskilled manual labor; in other words: how much well-being can a simple day laborer obtain through exchange?

It might be asserted that the natural social order is perfectible and harmonious, if, on the one hand, the number of people destined (to do) unskilled labor and who receive the lowest pay possible, decreases constantly and if, on the other, this pay, measured not in value nor in cash, but in genuine satisfaction, increases constantly.[557]

Addition to EH2

The ancients had described quite well all the possible combinations of exchange:

Do ut des[558] (product for product), Do ut facias[559] (product for service), Facio ut des[560] (service for product), Facio ut facias[561] (service for service).

Since products and services are exchanged for each other, they clearly have to have something in common, something (to) which they are compared and (against which they are) evaluated, that is to say, value.

But value is something identical to itself. Whether it is in the product or the service, it can derive therefore only from the same origin and raison d’être.[562]

This being so, is value originally and essentially in the product, and is it by analogy that we have extended the notion to include services?

Or on the other hand, does value lie in the service, and does it not take form in the product precisely and solely because the service is itself embodied in it?

A few people appear to believe that this is a question of purest hairsplitting.[563] This is what we will see shortly. For the moment, I will limit myself to observing how strange it would be if in political economy a good or bad definition of value would make no difference.

I think there is no doubt that at the outset, political economy thought it saw value in the product, and what is more in the physical makeup of the product. The Physiocrats attributed it exclusively to the earth and classified as sterile all the classes that do not add anything to matter, so closely were matter and value linked in their eyes.

It seems that Adam Smith ought to have destroyed this notion, since he made value result from labor. Do not pure services require labor, and consequently do they not imply a value? Smith was so close to the truth, but did not quite master it, for apart from what he said formally, that for labor to have value it had to be applied to matter, something that was physically tangible and that could be accumulated, every one knows that, like the Physiocrats, he classifies those who limit themselves to providing services among the non-productive classes.

To tell the truth, Smith pays a great deal of attention to these classes in his treatise on Wealth.[564] But what does that prove, if not that once he had given a definition he found himself cramped, and that consequently this definition was wrong? Smith would not have achieved the huge and merited reputation that he has if he had not written his magnificent chapters on education, the clergy and public services and if, when dealing with wealth, he had been limited by his definition. Fortunately, he avoided the yoke (imposed on him by) his premises through inconsistency. This always happens. Never has a man of some genius escaped inconsistency when starting from a principle that is wrong, otherwise he would be (become) progressively absurd (in his conclusions) and, far from being a man of genius, he would not even be a man (of ordinary intelligence).

Just as Smith had gone a step further than the Physiocrats, so Say went further than Smith. Little by little he was brought around to acknowledging (that there was) some value in services, but only by analogy or extension. It is in the product that he saw essential value, and nothing proves this better that this strange description given to services: “Non-material products,"[565] two words that cry out in pain at being tied together like this. Say started off from Smith, and what proves this is that the entire theory of the master is to be found in the first ten lines that begin the work of the disciple. However, he meditated and made progress over the space of thirty years. In this way, he approached the truth without ever reaching it completely.

What is more, it might have been believed that he fulfilled his mission as an economist both by extending (the notion of) value from (the product) to (include) (the service) and by tracing back the value of the service to that of the product, if socialist propaganda, based on his own deductions, had not come along to reveal the inadequacy and danger of his basic principle.

Having thus asked myself the question: Since certain products have value and since certain services have value, and since value that is identical to itself can have only one origin, one raison d’être, and one common explanation, does this origin and explanation lie in the product or in the service?

And I say this loud and clear, the reply does not appear to be in doubt for an instant, for the following incontrovertible reason, that any product that has a value implies the existence of a service, whereas it is not true that any service necessarily implies the existence of a product.

I consider this to be decisive, mathematically (decisive).

Take a service: whether it has a material form or not, it has value, since it is a service.

Take something material: if by handing it over, you render a service, it has value, but if there is no service, it has no value.

Therefore value does not pass from matter to service but from service to matter.

And that is not all. From the point of view of value, nothing can be more easily explained than this pre-eminence or priority over products (which we have) given to services. We will see that this is based on a circumstance easy to perceive, which we did not see precisely because it was blindingly obvious. It is none other than that foresight (which is) natural to man, by virtue of which instead of limiting himself to providing the services now asked of him he makes preparations in advance for providing the ones he foresees will be asked of him. This is how the facio ut facias (I do (something) for you so that you may do (something) for me) is transformed into do ut des "I give (something) to you so that you may give (something) to me.”), without ceasing to be the dominant fact behind and best explanation for all transactions.

Jean says to Pierre:[566] “I would like a new mug. I ought to make it myself, but if you would like to make it for me, you would be doing me a service which I will pay for with an equivalent service.”

Pierre agrees to this. Consequently, he starts to search for suitable clays, he mixes them and kneads them; in short he does what Jean ought to have done.

It is very clear here that it is the service that determines the value. The dominant word in the transaction is facio (I do something). And if later the value is included in the product, this is only because it arises from the service, which is the combination of the work done by Pierre and the work saved by Jean.

Well, it may happen that Jean often makes the same proposition to Pierre and that others make it as well, so that Pierre is able to forecast with certainty that this type of service will be asked of him and he can prepare (himself) to provide it (in the future). He may say to himself: “I have acquired a certain skill in making mugs. Experience tells me that mugs meet a need that has to be satisfied. Therefore, I can make some in advance.”

From that time onward, Jean ought to say to Pierre, not facio ut facias (I do (something) for you so that you may do (something) for me) but facio ut des (I do (something) for you so that you may give (something) to me). If, for his part, he has anticipated Pierre’s needs and done work ahead of time to meet them, he will say: do ut des (I give (something) to you so that you may give (something) to me).

But how, I ask you, has this progress that arises from human foresight changed the nature and origin of value? Has service not always been its raison d’être and (its) measure? What does it matter with regard to the true notion of value whether, in order to make a mug, Pierre has waited for someone to ask him for one or whether he made it in advance, foreseeing that he would be asked for one?

Note this: in the human race, inexperience and lack of foresight precede experience and foresight. It is only with the passing of time that people have been able to foresee their reciprocal needs to the extent of preparing to meet them. Logically, facio ut facias (I do (something) for you so that you may do (something) for me) had to precede the do ut des (I give (something) to you so that you may give (something) to me). The latter is simultaneously the fruit and evidence of some dispersed knowledge,[567] some acquired experience, some political security, or some confidence in the future, in a word, a certain degree of civilization. This social foresight, this belief in demand which means that we prepare the supply, this sort of intuitive (understanding of) statistics, of which everyone has a more or less accurate notion and which establishes so surprising an equilibrium between needs and supplies, is one of the most efficient springs[568] of human perfectibility. To it we owe the division of labor, or at least the professions and trades. To it we owe one of the things that men pursue with the greatest ardor, the stability of payment in the form of wages in the case of labor[569] and interest in the case of capital. To it we owe credit, operations of long term finance, those whose object is to level out risk, etc. It is surprising that from the point of view of political economy this noble attribute of man, foresight, has not been more noted. This, as Rousseau said, stems always from the difficulty we have in observing the environment that surrounds us, forming the very air we breathe. Only abnormal events strike us and we let pass unnoticed those that have their effects around us, on us, and in us, and create permanent and profound changes in man and society.[570]

To return to the subject with which we are dealing, it may be that human foresight as it spreads without limit increasingly tends to substitute do ut des (I give (something) to you so that you may give (something) to me) for facio ut facias (I do (something) for you so that you may do (something) for me), but we should nevertheless not forget that it is in the primitive and necessary form of exchange that the notion of value occurs for the first time, that this primitive form is reciprocal service and that after all, from the point of view of exchange the product is nothing other than a service expected.

After concluding that value is not inherent in matter and cannot be classified as one of its attributes, I am far from denying that it moves from service to product in such a way to become embodied in it, so to speak. I beg those who contradict me to believe that I am not pedantic enough to exclude such familiar sayings as ‘gold is worth (this much)’, ‘wheat is worth (that much)’ or ‘land is worth (so much)’ from the language. I merely feel I have the right to ask the question ‘why’ of economic science, and if it answers me: “Because gold, wheat, and land have an intrinsic value within them," I consider that I would be within my rights to tell it: “You are mistaken, and your error is dangerous. You are mistaken, for there exists gold and land that have no value: the gold and land that have not yet occasioned any human service. Your error is dangerous because it leads people to see the usurpation of the free gifts of God in a simple right to the reciprocity of services.”

I am therefore ready to acknowledge that products have value, provided that people allow that this value is not in their essence and that it is linked to and results from services.

And this is so true that it leads to a very important conclusion, one that is fundamental to political economy, and that has not been nor could have been noted, and it is this:

When value has moved from the service to the product, it is (still) subject to all the unforeseen events to which it continues to be subject in the service itself.

It is not anchored in the product, as it would be if it were one of its intrinsic qualities. No, it is essentially variable; it can be increased indefinitely, and reduced to nothing in line with the destiny of the type of service in which it originates.

The person who now makes a mug in order to sell it in a year’s time doubtless instills value in it, and this value is determined by the value of the service, not by the value that this service has now but by the value it will have in a year’s time. If, at the time he sells the mug, the type of service involved is more sought after, the cup will be worth more, if not it will be worth less.

This is why people are constantly being encouraged to exercise foresight and employ it usefully.[571] They always have the prospect of being rewarded for accurate predictions or punished for those that are not, should value [price??] increase or decrease. And note that their successes or failures coincide with the general good or ill. If they have organized their predictions properly they have made preparations ahead of time to offer services to the social bank[572] that are more sought after, more appreciated, more effective, and that meet needs that are more keenly felt. They will have contributed to reducing scarcity, increasing the supply of this type of service, and placing it within the reach of a greater number of people with less sacrifice on their part. If on the other hand, their forecasts were wrong, their competition would decrease even further the value of services for which the demand is already weak. They would suffer a loss at their (own) cost, a result that would be a warning that a certain kind of need does not currently require a significant portion of the activity of society and that if society takes this route, it will not be rewarded.

This remarkable fact, that the incorporated value,[573] if I may call it this, always has an application common to that of the type of service to which it is linked, is of the greatest importance, not only because it increasingly confirms the theory that the basis of value lies in the service, but also because it very easily explains phenomena that other systems consider to be abnormal.

Once the product has been launched on the world market, is there within the human race any general tendency to lower its value rather than increase it? This is to ask whether the type of service that has generated this value tends to be more or less remunerated. Either is equally possible, and this is what opens out a limitless vista to human foresight.

Nevertheless, it may be noted that the general law governing beings (who are) likely to experiment and learn and correct their errors, is progress.[574] It is probable, therefore, that at a given stage a certain expenditure of time and trouble will obtain greater results than in a previous period. From this we may conclude that the dominant tendency of incorporated value is to lower values. For example, if the mug I spoke of just now (which was symbolic of (all) products) was made several years ago, by all appearances it should have depreciated (in value) slightly. Indeed, to make an identical mug, we now have more skill, more resources, better tools, cheaper capital, and a division of labor better understood. Well, when the person who wants it contacts the holder of the mug, he does not say “Tell me what quantity and quality of work this mug has cost you so that I may pay you accordingly.” No, he says: “Today, because of the progress of the technology (of making mugs), I can make a similar mug myself, or obtain one through exchange for such and such an effort of such and such quality, and this is the top price I agree to give you.”

The result of this is that all incorporated value, in other words all accumulated labor, or all forms of capital tend to depreciate in (value in) the face of naturally perfectible and increasingly productive services and that, when we are trading current labor for previous labor, it generally has the advantage, as it should have, since it provides more services.

And this is the reason there is something so empty in the oratory we hear constantly directed against the value of private property in land.[575]

This form of value does not differ in any way from other forms, either in its origin, its nature, or the general law of (the) slow depreciation (in its value).

It represents services in a bygone age: draining, clearing, the removal of stones, leveling, fencing, the increase in the depth of topsoil, buildings, etc. Such wealth is there to claim the rights generated by these services. But these rights are not regulated by considerations of the labor carried out. The landowner does not say: “Give me in exchange for this land the amount of work which has been done on it” (this is how it would be expressed if, as in Smith’s theory, value came from labor and is proportional to it). Still less would he say, as Ricardo and a number of economists claim: “Give me first of all as much labor as has been done on the land, and then in addition a certain quantity of labor to compensate the natural forces that are present.” No, the landowner, the person who represents the owners who preceded him, right back to the initial clearers of the land, is reduced to speaking humbly on their behalf as follows:[576]

“We have prepared services and ask to exchange these for equivalent services. In the past we have worked a great deal, for in our day your powerful means of carrying this out were unknown. There were no roads; we were forced to do everything manually. A great deal of sweat and many human lives are buried in these furrows. But we are not demanding effort for effort; we would have no means of getting terms like this. We know that the labor on the land now, both in France and elsewhere, is much more advanced and productive. What we are asking for, and what obviously nobody can refuse us, is that our previous labor and labor done now should be exchanged proportionally, not with regard to their duration or intensity but according to their results, so that we receive the same remuneration for the same service. We lose, through this arrangement, from the point of view of labor, since twice and perhaps three times as much of ours than yours is required to provide the same service, but this is an inevitable arrangement forced upon us; we no more have the means of having another prevail than you have of refusing us this one.”

And, in point of fact, this is how things happen. If we were able to evaluate the necessary quantity of effort, drudgery, and sweat ceaselessly renewed to bring each hectare of French soil up to its current state of productivity, we would remain convinced that the person who buys it is not trading equal amounts of work, at least in ninety-nine percent of cases.

I have introduced this reservation here because we should not lose sight of the fact that an incorporated service[577] may acquire value in the same way as it may lose it. And even though the general tendency is downward, the contrary may occur sometimes in exceptional circumstances, with regard to land just as to anything else, without the law of justice being infringed and without our being able to call it a monopoly.

In the event, what is always present to produce value is service. It is very probably true that, for a given application, previous labor provides less service than current, but this is not an absolute law. If previous labor provides fewer services than current, as is almost always the case, more of the previous labor is needed in the exchange to establish an equivalence since, I repeat, equivalence is regulated by service. But on the other hand, when it happens that previous labor provides more service than current labour, the latter will suffer reduced payment in the form of a reduction in quantity …[578]

Footnote added to OC6 (1855)[579]

It is because efforts compete with one another in a régime of liberty, that they receive remuneration approximately proportional to their intensity. But, I repeat, this proportionality is not inherent in the notion of value.

And the proof of this is that where competition is non-existent, this proportionality is non-existent as well. In this case, no relationship is seen between work of various kinds and its remuneration.

The absence of competition may arise from the nature of things or because of human perversity.

If it arises from the nature of things, relatively little labour will be seen to generate high value without anyone’s having a genuine reason to complain. This is the case of the person who finds a diamond; it is the case of (the singer) Rubini,[580] (the singer) Malibran,[581] (the ballerina) Taglioni,[582] the tailor (currently most) in fashion, the owner of (the Burgundian vineyard) Clos Vougeot,[583] etc. etc. Circumstances have made them the owners of a means of providing services which is quite out of the ordinary; they have no rivals and exact a high payment. That the service itself is of extreme scarcity, proves that it is not essential for the well-being and progress of humanity. Therefore, it is an object of luxury and ostentation, which rich people procure for themselves. Is it not natural that, before taking on this type of satisfaction, each person expects to have the capacity to meet more pressing and reasonable needs?

If there is no competition because of some form of human violence, the same effects occur but with the huge difference that they happen where and when they should not have happened. In this case, we see comparatively easy labor giving rise to great value, but how? By outlawing with violence the competition whose job it is to make payment proportional to to service. In this case, just as Rubini is able to say to a music lover: “I want a huge payment or I will not sing at your soirée” – on the grounds that this is a service that he alone is able to provide – in the same way, a baker, butcher, landowner, or banker may say:[584] “I want a very large payment or you will not have my wheat, bread, meat, or gold, and I have (taken) precautions: I have hired soldiers with bayonets to prevent you from obtaining these elsewhere, so that nobody can provide you with services similar to mine.”[585]

People who liken artificial monopoly to what they call a natural monopoly because both of them have the common characteristic of increasing the value of labor are, I maintain, both very blind and very superficial.

Artificial monopoly is real plunder. It produces harm that would not exist without it. It inflicts privation on a sizeable section of society, often with respect to the most necessary items. What is more, it gives rise to the fruits of injustice: (namely) resentment, hatred, and reprisals.

Natural advantages do no harm to the human race. The most we can say is that they confirm a pre-existing harm (which) in no way is attributable to anyone. It is disagreeable, perhaps, that Tokay[586] is not as abundant and as cheap as ordinary red wine wine. But that is not the result of some social act; it has been imposed on us by nature.

There is therefore the following profound difference between a natural advantage and artificial monopoly:

Natural advantage is the result of a pre-existing scarcity, one that is unavoidable;

Artificial monopoly is caused by an artificial scarcity, one that is against nature.

In the first case, it is not the absence of competition that causes scarcity, but scarcity that explains the absence of competition. The human race would be childish if it tormented itself and caused a revolution because in the world there is just one Jenny Lind,[587] one Clos Vougeot, and one Governor of the Bank of France.

In the second case, it is quite the opposite. It is not because of providential scarcity that competition is impossible, but because force has stifled competition, that a scarcity which should not exist has been produced in society.

Another Footnote Inserted by the Editors in 1855 edition

Footnote to “Capable of being Accumulated.”

Accumulation is a circumstance of no consequence in political economy.

Whether satisfaction is immediate or delayed, whether it can be postponed or separated from the effort that produces it, in what way does it change the nature of things.

I am inclined to make a sacrifice for the pleasure of hearing a beautiful voice, so I go to the theater and I pay; the satisfaction is immediate. If I had used my money to buy a plate of strawberries, I would have been able to postpone my satisfaction until the next day; that is all.

It can be said, of course, that the strawberries are a form of wealth, because I can still exchange them. That is true. Once the effort has been made, as long as the satisfaction remains unfulfilled, the wealth still exists. It is the satisfaction that destroys the wealth.

When the plate of strawberries has been eaten, this satisfaction will go the way of the other that brought me Alboni's voice.[588]

Service received, service rendered; such is political economy.

 


 

VI. Wealth

So, out of everything that can satisfy our needs and desires, two things have to be considered and distinguished: what nature has produced and what man makes, what is gratuitous (or free of charge) and what is onerous (or costly), the gifts of God and the services provided by human beings, utility and value. In one and the same object, utility may be immense and value imperceptible. As the former remains invariable, the latter may be reduced indefinitely, and does in fact decrease each time some ingenious (industrial) process obtains for us the same result for less effort.

Here we sense one of the greatest difficulties and one of the most fertile sources of misunderstandings, controversy, and error, at the very gateway of economic science.

What is wealth?

Are we wealthy to the degree that we have useful things at our disposal, that is to say the needs and desires that we can satisfy? “A man is rich or poor," says Adam Smith, “depending on the greater or lesser number of useful things he is able to procure for his own enjoyment.”[589]

Are we wealthy in proportion to the things of value we own, that is to say the services we are able to draw upon? “Wealth," says J. B. Say, “is in proportion to value. It is great if the sum of values which make it up is considerable; it is small if the (sum of) values is small.”[590]

The uninformed give both meanings to the word “wealth." Sometimes they are heard to say: “The abundance of water is a source of wealth for this or that country,” in which case all they are thinking of is utility. But when one of them wants to ascertain his own wealth, he carries out what is known as an inventory, in which only value is taken into account.

With all due respect to scholars, I believe that those who are uninformed are right this time. Wealth indeed is real or relative. At first sight it is evaluated according to our satisfactions; the human race becomes all the more wealthy the more well-being it acquires, no matter what the value of the objects that provide it. But if you want to find out the proportional share of each person in the general well-being, in other words, his relative wealth, this is a simple relationship that the concept value alone reveals, because it itself is a relationship.[591]

Economic science concerns itself with people’s general well-being, the ratio that exists between their efforts and their satisfactions, one that changes to our advantage the increasing contribution made by gratuitous utility to the work of production. It (economics) cannot therefore exclude this element from the idea of wealth. As economics understands things, real wealth is not the sum of things of value but the sum of gratuitous or costly utilities that are bound up with these things of value. From the point of view of satisfaction, that is to say, in the real world, our wealth stems as much from the value (which has been) destroyed by progress as from that which manages to survive it.[592]

In the ordinary transactions of life, we no longer take account of utility as it becomes gratuitous because of the reduction in its value. Why? Because what is free is common to all and what is common to all does not in any way change the proportional share of each person in the (total amount) of real wealth. People do not exchange what is common to all, and since as we go about our business all we need to know is the proportion represented by value, this is all we take notice of.

A discussion arose between Ricardo and J. B. Say on this subject. Ricardo gave the word wealth the meaning of utility while J. B. Say gave it that of value.[593] It was impossible for one of these champions to triumph decisively, since “wealth” embraces both meanings depending on whether it is taken from the real or relative point of view.

However it has to be said, and especially since Say’s authority is greater in these matters, if wealth (in the sense of real well-being) is conflated with value and if in particular it is claimed that one is in proportion to the other, you run the risk of leading political economy astray. Books by second-rate economists and socialists offer us only too great (a) proof of this. This is an unfortunate starting point; one that distracts our gaze from precisely what forms the finest heritage of the human race. It causes us to consider as destroyed the part of well-being that progress has made common to all, and puts people’s minds into the greatest of dangers, that of entering into a discussion which begs the (entire) question and has no result and no end, namely of conceiving a form of “back to front political economy” in which the aim to which we aspire is constantly confused with the obstacle that stops us.[594]

In reality, value exists only because of these obstacles. It is the sign, the symptom, the evidence and proof of our inherent infirmity. It constantly reminds us of the decree that was pronounced at the beginning: “By the sweat of thy brow shalt thou eat bread."[595] For the all-powerful Being, the words, effort, service, and consequently value do not exist. As for us, we are immersed in a world of useful things, of which a large number are free of charge but others are available to us only at a cost. Obstacles come between these useful things and the needs they are able to satisfy. We are condemned to do without the utility or else overcome the obstacle through our efforts. Sweat has to fall from our brow either on our behalf or on behalf of those who have sweated for our benefit.

Thus, the more things of value there are in society, the more probable it is that this constitutes proof of our having overcome obstacles, and the more it also shows that there were obstacles (that had) to be overcome. Will we go so far as to say that these obstacles create wealth because without them things possessing value would not exist?

We can imagine two nations. One has more satisfactions than the other but fewer things of value, because nature has favored it and it encounters fewer obstacles. Which of them will be the wealthier?

Let us go further. Let us take the same nation at two different times. The obstacles to be overcome are the same. However, it is currently overcoming them with such ease, for example, it carries out its transport, plowing, and weaving with so little effort, that their value has become considerably reduced. It has therefore been able to take one of the following two options: either to content itself with the same (amount of) satisfactions as in the past, and expressing its progress in the form of leisure (time),[596] in which case will anyone say that its wealth has decreased because it possesses fewer things of value? Or else it may devote its efforts (more of) which have now become available to it, to increasing its enjoyments, and will people think of concluding that its wealth has also remained the same because the total amount of its things of value will have remained the same? This is what would happen if the two notions of wealth and value were conflated.

There is a big trap here for political economy. Ought it to measure wealth by the satisfactions enjoyed or by the things of value created?

If there were never any obstacles between utility and desire, there would be no efforts, no services, and no value(s), any more than there are for God, and while in one sense the human race, like God, would possess infinite wealth, in another it would be deprived of all wealth. If two economists each adopted one of these definitions, one would say: “The human race is infinitely rich," while the other would say: “It is infinitely poor.”

It is true that the infinite is not an attribute of the human race in any way whatsoever. But in the end the human race leans in one direction or another, it makes efforts, it has tendencies, and gravitates towards steadily increasing wealth or steadily increasing poverty. Well, how can economists agree if this gradual destruction of the effort compared to the result, of the trouble that needs to be taken or paid for, of value (itself), is considered by some to be progress toward wealth and by others as a descent into poverty?

What is more, if the problem concerned only economists, people might say: “Leave them to argue about it." However, legislators and governments have to take measures every day that have a real influence on human interests. And where would we be if these measures are taken in the absence of any enlightenment that enables us to distinguish between wealth and poverty?

Well, I maintain that the theory that defines wealth in terms of value is in the end just a glorification of obstacles. Its syllogism is this: “Wealth is proportional to things of value, things of value (are proportional) to efforts, and efforts (are proportional) to obstacles; therefore wealth is proportional to (the number of) obstacles.”

I furthermore maintain this: because of the division of labor which has assigned men to one trade or job, this illusion is very difficult to eliminate. Each of us earns a living from the services he renders when they are required (to overcome) some obstacle, (satisfy) a need, or (alleviate some) suffering: a doctor faced with illness, a farmer with famine, a manufacturer with cold, a coach driver with distance, a lawyer with injustice, or a soldier with danger to the country, so that there is not a single obstacle whose disappearance would not be very unfortunate and very inconvenient for someone, and may even seem to be disastrous from the general point of view because it appears to destroy a particular source of service(s), things of value, or wealth. Very few economists have been entirely immune to this illusion, and if economic science ever succeeds in overcoming it, its practical mission in the world will be fulfilled, for I make yet a third statement: Our official policy is imbued with this theory and each time governments believe they have to favor a particular class, profession, or industry, they have no other procedure than that of erecting (more) obstacles in order to give a certain type of effort an opportunity to develop, so as to increase artificially the the range of services which the community will be forced to use, and thus to increase value and supposedly wealth.

And in fact it is only too true that this procedure is useful to the class being favored. We see it congratulating itself, applauding (itself), and what do we do? We allow the same favor to (be given to) all the other classes in turn.

What is more natural than to conflate utility and value in the first instance, and then value to wealth! Economic science has not met a trap that it has suspected less. For what happened? At each stage of (our) progress, its reasoning was as follows: “The obstacles have decreased (in number) and therefore effort has decreased; therefore value has decreased, utility has decreased, and therefore wealth has decreased. Therefore we are the most unfortunate of men for having been shrewd in our inventing things, exchanging things, having five fingers instead of three, and two arms instead of one. We therefore have to get the government, which has the power of coercion (in its hands), to establish order in the face of these abuses.”[597]

This back to front form of political economy has paid the expenses of a great many of our journals and of sessions in our legislative assemblies. It has misled the honest and philanthropic Sismondi[598] and we find it logically set out in the book by Mr. de Saint-Chamans.[599]

“There are two sorts of wealth for a nation," he says. “If products that are useful from the point of view of quantity and abundance are the only kind taken into consideration, we are dealing with a type of wealth that provides benefits for society and that I will call wealth based on enjoyment.[600]

If products are considered from the point of view of their exchange value or simply their value, we are dealing with a type of wealth that provides things of value or society and that I will call wealth based on value.

Political economy deals in particular with wealth based on value, and it is above all this that the Government can deal with.[601]

This having been said, what can political economy and the government do? The first can indicate the means of increasing this wealth based on value and the second can put these means to work.

However, wealth based on value is proportional to effort, and effort is proportional to the obstacles it finds. Political economy therefore has to teach, and the government find, a way of increasing the number of these obstacles. Mr. de Saint-Chamans does not give ground in the slightest in the face of this conclusion.

Does exchange make it easier for people to have the means of acquiring more wealth based on enjoyment with less wealth based on value? Exchange will have to be impeded.[602]

Is there a portion of free or gratuitous utility that could be replaced by costly or onerous utility, for example by taking away a tool or a machine? This will have to be done since it is perfectly obvious, he says, that if machines increase wealth based on enjoyment, they decrease wealth based on value. “Let us bless the obstacles that the high price of fuel place in the way of the increasing number of steam engines in our society.”[603]

Has nature done us any favors in one way or another? This would be our misfortune, since by doing so it has taken away from us an opportunity to work. “I admit that it is highly possible for me to want or even make, using my hands, my sweat, and the labour I am forced to do, what can be produced without any bother and spontaneously.”[604]

So, what a pity that nature has not allowed us to manufacture drinking water! This would have been a fine opportunity of producing wealth based on value. It is a stroke of good fortune that we take our revenge on wine. “Only find the secret of making springs of wine come out of the ground as abundantly as springs of water and you will see these admirable arrangements ruining a quarter of France.”[605]

According to the string of ideas that our economist toys with so naively, there is a host of means, all very simple, of limiting men to creating (only) wealth based on value.

The first is to take it (wealth based on enjoyment?) from them gradually. “If taxes take money where it is plentiful to distribute it where it is scarce, they are useful, and far from being a loss to the State, they are a gain.[606]

The second is to redistribute it. “Luxury and extravagance that are so harmful to individual fortunes are advantageous to public wealth. I will be told that I am preaching a fine form of morality in this. I do not claim to do so. It is a question of political economy and not of morality. People are looking for the means of making nations wealthier, and I am preaching the gospel (of) luxury.”[607]

A means that is swifter still is to destroy it through good wars. “If people acknowledge in agreement with me that the expenditure of those who are extravagant is as productive as any other, that expenditure by governments is equally productive … they are no longer surprised at the wealth of England, following this very expensive war.”[608]

However, to stimulate the creation of wealth based on value, all these means, taxes, luxury, war, etc. will have to defer to the one method that is much more effective: fire.

“Construction is a great source of wealth because it supplies income to owners who sell materials, to workers, and to various categories of artisans and artists. Melon[609] cites Sir William Petty,[610] who considers the work done to rebuild the buildings of London after the famous fire that consumed two thirds of the town[611] as a profit for the nation and he estimates (this profit!) to be one million pounds sterling per year (at 1666 values) for four years,[612] without its having changed other forms of trade in the slightest.” Mr. de Saint-Chamans adds that without considering the evaluation of this profit at a fixed figure as well founded, it is at least certain that this event did not have a negative influence on English wealth at this time. Sir William’s finding is not impossible, since the necessity of rebuilding London had to have created a huge amount of new income.”[613]

Economists who start from the basis that wealth is value, would necessarily reach the same conclusions if they were being logical, but they are not, because on the road to absurdity people always stop sooner or later, depending on how fair-minded they are. Mr. de Saint-Chamans himself appears finally to have retreated a little in the face of the consequences of his position when it leads him to the point of praising fire. We see him hesitate and content himself with negative praise. Logically he ought to go to the bitter end and say openly what he leaves us to understand quite clearly.

Of all the economists, the one who has succumbed in the most dreadful way to the difficulty we are facing here is certainly Mr. de Sismondi. Like Mr. de Saint-Chamans, he has taken as his starting point the idea that value is an element of wealth. Like him, he has constructed a form of back to front political economy on this basis, cursing everything that decreases value. He too exalts obstacles, forbids machines, curses exchange, competition, and freedom, glorifies luxury and taxes, and finally reaches the conclusion that the more abundant everything is the more people are deprived of everything.

Yet from one end to the other of his writings, Mr. de Sismondi appears to have in the depths of his awareness the feeling that he is mistaken, and that a veil he cannot penetrate has been drawn between him and the truth. Like Mr. de Saint-Chamans, he dares not draw the callous conclusions of his thought; he is perturbed, and so he hesitates. From time to time he asks himself if it is possible that all men since the dawn of time have been mistaken, and on the road to suicide when they seek to belittle the relationship between effort and satisfaction, that is to say, value. Both a friend and enemy of freedom, he fears it since it leads to universal poverty through the abundance that depreciates value, and at the same time he does not know what to do to eliminate this disastrous freedom. In this way, he reaches the outer limits of socialism and artificially created organisations, he hints at the notion that government and economic science alike ought to regulate and restrict everything and then, realizing the danger of this advice, he withdraws it, and ends up by falling into (a state of) despair saying: “Freedom leads to the abyss, coercion is as impossible as it is ineffective; there is no solution.”[614] Indeed, there is none if value is wealth, that is to say, if the obstacle to well-being is well-being, then the bad is the good.

The last writer, to my knowledge, to have gone over this question is Mr. Proudhon. It was a lucky topic for his book on Economic contradictions.[615] There has never been a finer opportunity to grab hold of a logical contradiction and to thumb one’s nose at economics, nor a better chance of saying to the subject: “Do you think that increasing value is a good or bad thing? Quidquid dixeris argumentabor.[616]” I leave you to imagine the fun he had![617]

“I call upon any serious economist," he says, “to tell me, otherwise than by translating and repeating the question, what causes value to decrease as production increases and vice versa. In technical terms, use value and exchange value, although essential to each other, are diametrically opposed to one another. Use value and exchange value therefore remain fatally chained to one another, although by their nature they constantly aim at mutual exclusion.”[618]

“There is no attributable cause nor possible explanation for the inherent contradiction in the notion of value … Given that man needs a great variety of products, with the obligation of procuring them through his work, the opposition of use value to exchange value is an inescapable consequence and from this opposition a contradiction arises on the very threshold of political economy. No mind, no divine or human will could stop this. So, instead of seeking a useless explanation, let us content ourselves with recording properly the necessity for the contradiction.[619]

We know that Mr. Proudhon’s great discovery is that everything is both true and false, good and bad, legitimate and illegitimate, that there is no principle that does not contradict itself, and that contradiction is not only in erroneous theories but also in the very essence of things and phenomena.[620] “It is the pure expression of necessity, the inner law of beings, etc.” Given all this, it is inevitable and would be rationally incurable without the serial nature of contradiction[621] and in practice, without the People’s Bank.[622] God, contradiction; freedom, contradiction; competition, contradiction; property, contradiction; value, credit, monopoly, community, paradox and still more paradox. When Mr. Proudhon made this famous discovery, his heart must have leapt for joy for, since contradiction is in everything and everywhere, there is always something to contradict, which for him is the supreme good. He said to me one day: “I would like to go to Paradise, but I am afraid that everyone will agree there, and that I will not find anyone there with whom to disagree.”

It has to be admitted that the issue of value supplied him with an excellent opportunity to exercise paradox at leisure. However, and I beg his pardon for this, the contradictions and oppositions that are resurrected by this word are in false theories and not at all, as he claims, in the very nature of the phenomenon.

The theorists began first of all by confusing value with utility, that is to say, the bad with the good (for utility is the desired result and value arises from (removing) the obstacle that comes between the result and the desire). This was the first mistake, and when they perceived its consequences they thought they would overcome the difficulty by imagining a distinction between the value which comes from its utility and the value which comes from its exchange,[623] an oppressive form of tautology which had the defect of attaching the same word, value, to two opposing phenomena.

But if, setting aside these subtleties, we concentrate on the facts, what do we see? Nothing assuredly that is other than very natural and not very contradictory.

A man works for his own benefit exclusively. If he acquires skill, if his strength and knowledge develop, if nature becomes more liberal, or if he learns to harness it better to his labor, he has more well-being with less trouble. Where do you see any contradiction, and is there very much to complain about?

Now, instead of living in isolation, this man enters into relationships with other people. They exchange, and I repeat my comment: the more they acquire skill, experience, strength, and knowledge and the more nature, having become more liberal or more subject to his will, contributes more effectively, the more well-being they have for less trouble, the greater amount of gratuitous utility is at their disposal, and through their transactions they transmit to one another a greater sum of useful results for each given quantity of labor. Where is the contradiction in this?

If you make the mistake, however, following the example of Smith and all his successors, of attaching the same word, value, both to the results obtained and the trouble taken, a paradox or contradiction will arise. However, note this clearly, it is entirely a matter of your erroneous explanations, and not at all of the facts.

Mr. Proudhon ought then to have set out his proposition thus: given that man needs a great variety of products and must procure them through his work and the precious gift he has of learning and improving himself, there is nothing more natural in the world than the sustained increase in the results obtained compared with his efforts, and it is not at all contradictory that a given value serves as a means to get more real utility.

Because once again, for man, utility is the bright side and value the dark side of the coin. Utility relates only to our satisfactions while value only relates to the trouble we have taken. Utility makes possible our enjoyments and is proportional to them; value bears witness to our inherent infirmity and arises from the obstacles to which it is proportional.

Because of the human perfectibility, gratuitous utility increasingly tends to be substituted for onerous utility (which is) expressed by the word value. This is the nature of the phenomenon, and it clearly represents nothing contradictory.

But there still remains the question of knowing whether the word wealth ought to include these two forms of utility combined or just the latter one.

If, once and for all, two (different) classes of utility could be established, with on one side all those that are gratuitous and on the other all those that are onerous, you would also be establishing two (different) classes of wealth, which might be called natural wealth and social wealth as with Mr. Say, or else wealth based on enjoyment and wealth based on value along with Mr. de Saint-Chamans. Subsequently, so these writers suggest, no further notice would be taken of the first of these.

“Goods accessible to all," says Mr. Say, “which each person may enjoy at will, without needing to acquire them, without fear of exhausting them, such as air, water, sunshine, etc. may be called natural wealth, as they have been given to us free of charge by nature. Since they cannot be produced, distributed, or consumed, they are outside the scope of political economy.

Those (things) whose study is the subject of political economy are made up of goods that we own, which have a recognized value. They may be called social wealth because they exist only where men are grouped together in society.”[624]

Wealth based on value," says Mr. de Saint-Chamans, “is the specific subject of political economy and each time that I mention wealth in this work without specifying the type, it will be to this type only that I will be referring.”[625]

Almost all economists have taken this view:

“The most striking distinction that first presents itself," says Storch, “is that there are things of value that can be appropriated and those that cannot.[626] Only the first are the subject of political economy, for an analysis of the others would produce no result worthy of the attention of a statesman.”[627]

For my part, I believe that the portion of utility that, as a result of progress, ceases to be onerous or costly, ceases to have a value but does not cease to be useful for all that, and moves into the category of being common to all and free of charge, is precisely the one that ought to be constantly in the minds of statesmen and economists. Without this (being understood), instead of delving into and understanding the major results that affect and lift up the human race, political economy is left facing something that is totally incidental, ever changing, that tends to decrease if not disappear, in other words the simple relationship which is value. Without realizing what it is doing, it will allow itself to consider only the trouble, the obstacle, or the interest of producers, and what is worse, to confuse this interest with the public interest, that is to say, (mis)taking bad for good and, in such a way that under the sway of people like Saint-Chamans or Sismondi, it will fall into the trap of a socialist utopia or a Proudhonian paradox.

And then is this (line of) demarcation between the two forms of utility not totally illusionary, arbitrary, and impossible? How can you dissociate the cooperation of nature and the cooperation of man in this way, when they blend, join together, and are combined everywhere, and what is more when one constantly tends to supplant the other, and this is exactly what constitutes progress? If economic science, which is so dry in some respects,[628] elevates, and fascinates the mind in others, it is precisely because it describes the laws of this association between man and nature. It shows how gratuitous utility increasingly replaces onerous utility; how the proportion of enjoyments (available to) to man increases with respect to his hard work; how obstacles are constantly reduced and value (along) with them; how the constant disappointments of producers are more than compensated for by the increasing well-being of consumers; and how natural wealth, that is to say, wealth that is free of charge and common to all, is taking the place of personal and appropriated wealth. By doing that we would be excluding from political economy what constitutes its providential harmony![629]

You say that air, water, and sunlight are free of charge. That is true, and if we enjoy them merely in their primitive form, if we do not use them in any of our labors, we might exclude them from political economy just as we exclude the possible and probable utility of comets. But take a look at man when he started and where he is now. At the beginning, he was able to make use of water, air, light, and the other natural resources only in a very limited way. Each of his satisfactions came at the cost of great personal effort, required great labor, and could be passed on to others only as a great service, in a word, each one represented a great deal of value. Little by little, this water, air, and light, gravity, the compressibility of air, heat, electricity, and plant life emerged from this relative inertia. They became increasingly involved in our industry. They took the place of human labor. They did free of charge what we used to do for a cost. Without undermining satisfaction, they destroyed (some) value. In common parlance, what used to cost one hundred francs now costs only ten and what required ten days of hard work now requires only one. All this destroyed value has moved from the domain of (private) property into that of the Commons.[630] A considerable proportion of human effort has been freed up and made available for other activities.[631] This is how, for equal amounts of trouble, services, and values the human race has vastly widened the range of its enjoyments and still you say that I ought to remove from the study of economic science the gratuitous utility that is common to all and that, on its own, explains both the height and breadth of progress if I may put it this way, both in terms of well-being and equality!

Let us conclude that we can, and legitimately do, give two meanings to the word wealth:

Real wealth, true wealth, which provides satisfactions, or the sum of utilities that human labour assisted by the cooperation of nature makes available to society.

Relative Wealth, that is to say, the proportional share each person has of the general wealth, a share that is determined by value.

Here therefore is the law of harmony, summed up in the following phrase:

Through his labor, the action of man[632] is combined with the action of nature.

Utility is the result of this cooperation.

Each person takes a share of general utility which is proportional to the value which he has created, that is to say, to the services he has rendered; that is to say in the final analysis, proportional to the utility which he himself (has produced).[633]

Appendix on The Morality of Wealth (added to EH2)[634]

We have just been studying wealth from the economic point of view; it is perhaps germane to say something about its moral effects.

Wealth has always been controversial from the moral point of view. Some philosophers and some religions ordained that it should be scorned; others in particular praised it in moderation, or Aurea mediocritas (the golden mean).[635] Very few, if any, accepted (as moral) a burning desire to enjoy the benefits of great wealth.

Who is right and who wrong? It is not the task of political economy to treat the subject of individual morality. I will say just this: I have always been led to believe that, in those things that are in the domain of universal practice, theorists, scholars, and philosophers are much more likely to be mistaken than universal practice, where the word “practice” is understood to mean not only the actions of the majority of men but also their sentiments and ideas.

Well, what does universal practice show us? It shows us everyone endeavoring to escape from the poverty that is our starting point, everyone preferring the experience of satisfaction to that of need, and wealth to deprivation. Everyone, I say, and with very few exceptions, even those who speak out against wealth.

The aspiration to (acquire) wealth is huge, constant, universal, and overpowering. Almost all over the world, it has triumphed over our inherent aversion to work. Whatever people say, it reveals a characteristic of the lowest form of greed that is even more marked in primitive peoples and barbarians than in civilized nations. All the navigators who set sail from Europe in the eighteenth century, imbued with the ideas made fashionable by Rousseau, that they were going to meet in the Antipodes people in a state of nature, selfless, generous, and hospitable, were struck by the rapacity with which these primitive peoples were endowed. Our soldiers have recorded in our time what ought to be thought of the much vaunted selflessness of the Arab races.[636]

On the other hand, the view of all men, even those whose conduct does not conform to this, is unanimous in honoring selflessness, generosity, and self-control, and decrying the uncontrolled love of wealth, which incites us to stop at nothing in order to achieve it.

Finally, the person who, under all conditions, perseveres in working honestly to improve his lot and better the situation of his family receives the same favorable consideration. It is from this set of facts, ideas, and sentiments that I think the verdict on wealth from the point of view of individual morality ought to be formulated.

First of all, it has to be recognized that the driving force that impels us toward wealth is in nature. It is providential in its creation and consequently moral. It lies in the original and general destitution that would be the lot of us all if it did not create in us the desire to escape it. We then have to acknowledge, in the second place, that the efforts made by men to escape this original destitution, provided that they remain within the bounds of justice, are respectable and worthy of esteem, since they are universally esteemed and respected. Besides, nobody fails to agree that work itself is inherently moral in character. This is encapsulated in the proverb that exists in every country:"Idleness is the mother of all vices." And it would be a shocking contradiction if on the one hand we said that work is essential to human morality and on the other that men are immoral if they seek to achieve wealth through their labor.

In the third place, it has to be acknowledged that to aspire to wealth becomes immoral when it drives us to exceed the bounds of justice and also that greed becomes less common as those who give in to it become richer.

This is the verdict, not of a few philosophers or sects, but of people universally, and I support it.

Nevertheless, I note that this verdict may not be the same now as it was in ancient times, without there being any contradiction.

The Essenes[637] and Stoics[638] lived in a society in which wealth was always the prize of oppression, pillage, and violence.[639] Not only was it immoral in itself, it was immoral because of the way in which it was acquired and testified to the immorality of those who possessed it. A reaction, even an exaggerated one, against the wealthy and wealth (itself) was only natural. Modern philosophers who speak out against wealth without taking into account the difference in the means of acquiring it take themselves for Seneca[640] or Christ. They are just parrots repeating things they do not understand.

However, the question raised by political economy is this: Is wealth a moral good or a moral evil for the human race? Does the gradual development of wealth imply an advance or a step backward from the moral point of view?

The reader will anticipate my reply and understand that I had to say something on the question of individual morality to escape this contradiction, or rather this impossibility: that what is immoral in individuals is moral in general.

Without having recourse to statistics or prison records, we can deal with a problem that is summed up as follows:

Do people degenerate as they increase their control over things and nature, as they tame nature into serving them, as they thereby create for themselves time for leisure[641] and, as they become able, by freeing themselves from the most pressing of their physical needs, to drag out of the inertia in which they slumbered, the intellectual and moral capacities, which doubtless have not been given to mankind only for us to remain eternally lethargic?

Do people degenerate as they distance themselves, so to speak, from the most physical state (imaginable) in order to lift themselves up towards the most spiritual state that they are able to approach?

When set out in this way, the problem solves itself.

I will readily agree that when wealth increases by immoral means it has an immoral influence, as in Roman society.

I will also agree that when it increases in a highly unequal manner, opening up an ever deeper abyss between the classes, it has an immoral influence and creates subversive passions.

But is this also true when it is the fruit of honest work or free transactions and when it is disseminated uniformly over all classes? This is truly not sustainable.

Yet socialist books are full of oratory against the wealthy.

I really do not understand how these schools of thought that are so diverse in other ways but so unanimous in this respect do not see the contradiction into which they have sunk.

On the one hand, according to the leaders of these schools, wealth has a pernicious and demoralizing effect that sullies the soul, hardens the heart, and allows only a taste for depraved pleasures to survive. The wealthy are full of every vice, the poor of all the virtues. The poor are just, sensible, selfless, and generous, that is the theme they adopt.

On the other hand, all the socialists’ efforts of imagination, all the systems they invent, all the laws they want to impose on us, tend, if we are to believe them, to covert poverty into wealth. …[642]

The morality of wealth (is) proved by this maxim: One man’s profit is another man’s profit…[643] [644]

 


 

VII. Capital[645]

Economic laws act on the same basis, whether they are dealing with large numbers of people, two individuals or even just one, condemned by circumstances to a life of isolation.

If he were able to live in isolation for a time, the individual would be simultaneously a capitalist, entrepreneur, worker, producer, and consumer. The entire evolution of economics would be accomplished in him (alone). By observing each of the elements that make up this evolution: need, effort, satisfaction, gratuitous utility, and onerous utility, he would gain an idea of the entire mechanism,[646] although reduced to its most elementary form.

Well, if there is one thing in the world that is obvious, it is that he could never confuse what is gratuitous with what requires an effort. Such confusion implies a contradiction in terms. He would be fully aware when some material or power is supplied by nature without any call on his labor and these contribute to making his labor more fruitful.

An individual living in isolation would never think of putting demands on his own labor for something he could gather directly from nature. He would not go for water a league away when there was a spring close to his hut. For the same reason, each time he was obliged to have recourse to his own labor, he would seek to substitute a contribution by nature for it as far as possible.

For this reason, if he were building a canoe, he would make it from the lightest wood in order to take advantage of the specific gravity of water. He would endeavor to provide it with a sail, so that the wind would spare him the trouble of rowing, etc.

In order to harness natural forces in this way, one needs tools.

At this point, we sense that an individual living in isolation would have to make a calculation. He would ask himself the following question: Now I am achieving satisfaction with a given amount of effort. When I have some tools, will I achieve the same satisfaction for less effort, (after) adding the effort of making the tools themselves to what (still) remains for me to do?

No man wants to waste his strength for the pleasure of wasting it. Our Robinson Crusoe[647] will therefore not devote himself to manufacturing a tool unless he perceives in the end a clear saving of effort for the same satisfaction or an increase in satisfaction for the same effort.

A circumstance that has a considerable bearing on the calculation is the number of products made and how frequently the tool will have to be used during its lifetime. Robinson Crusoe has an initial yardstick. This is his current effort, the effort to which he is subject each time he wants to obtain the satisfaction directly for himself without any assistance. He calculates what the tool will save him in effort on each of these occasions, but he will have to work to manufacture the tool, and he will divide this labor in his mind by the total number of occasions on which he will be able to use it. The greater this number, the more pressing the motive will be to harness natural resources too. It is here, in the distribution of an advance payment over the total number of products made that the basis and raison d’être of interest lies.

Once Robinson Crusoe has decided to manufacture a tool, he realizes that (his) willingness (to do so) and (the expected) advantage are not enough. Tools are needed to make tools; iron is needed to hammer out iron and so on, going backward from difficulty to difficulty to an initial difficulty that appears to be insoluble. This alerts us to the extreme slowness with which capital must have been accumulated originally and to the enormous degree human effort was called upon to achieve each satisfaction.

This is not all. In order to make tools for work, even if you had the tools needed, (raw) materials were also necessary. If they are supplied gratuitously by nature, like stone, they still have to be gathered, and this takes effort. The possession of these materials, however, almost always implies previous labor, which is long and complicated, as when you have to use wool, linen, iron, lead, etc.

That is still not all. While a man is working in this way with the sole aim of making future work easier, he is doing nothing to meet his current needs. Well, involved here is an order of phenomena that nature has no intention of disrupting. Every day, people have to eat, clothe themselves, and have shelter. Robinson Crusoe will therefore see that he cannot undertake anything with respect to making nature’s forces contribute unless he has first of all accumulated a stock of provisions. He will have to redouble his efforts to hunt and save some of the game and then deprive himself so as to give himself the time he needs to make the tool he plans. In these circumstances, it is more than likely that his aspiration will be limited to making a rough and imperfect tool, one that is not very suited to the use to which it is to be put.

Later on, all (his) faculties will improve together. Reflection and experience will have taught our island dweller how to do things better. The initial tool itself will supply him with the means to make others and to amass a stock of provisions more quickly.

Tools, materials, and provisions are what Robinson Crusoe will doubtless call his capital, and he will readily acknowledge that the more of this capital he has, the more use he will make of the forces of nature, the more these forces will assist his work, and in the end the greater will be the relationship between his satisfaction and his effort.

Let us now move into the social realm. Here too, capital will be made up of tools, materials, and provisions without which, neither in isolation nor in society, can anything be done over a long period. Those who have this capital will have it only because they have created it through their (own) efforts or privations and they will not have made these efforts (reaching beyond their current needs) nor imposed these privations on themselves, without having future benefits in sight, for example, with a view to harnessing a significant proportion of the forces of nature from now on. From their point of view, to give up this capital would be to deprive themselves of the benefit sought and hand it over to someone else; it would be to provide a service. In this case, either we would have to renounce the most elementary principles of justice and even renounce reasoning (itself), or we would have to acknowledge that they have a perfect right to make this transaction only in exchange for a service that has been freely negotiated and voluntarily agreed to. I do not think there is a single person on earth who disputes the justice of the mutuality of services, since the mutuality of services is another way of expressing justice. Will people say that transactions should not be made freely because the person who has the capital is in a position to dictate to the one who does not? But how should they be carried out? How can we recognize the equivalence of services[648] if not by the fact that each party has voluntarily agreed to the exchange? What is more, do we not see that the borrower who is free to do so will refuse if there is no advantage to him in accepting, and that the loan can never make his situation worse? It is clear that the question he will ask himself is this: Will the use of this capital provide me with benefits that will more than compensate the conditions asked of me? Or else: Is the effort I am currently obliged to devote to obtaining a given satisfaction greater or less than the sum of the efforts the loan will oblige me to make, first of all to provide the services asked of me and then to seek this satisfaction using the capital I have borrowed?

If, all things included and considered, there is no advantage in this, he will not take the loan and will remain where he is, and in this case what wrong is being done to him? He may be making a mistake, people will say. Doubtless. People may make mistakes in all the forms of transaction imaginable. Is this to say that there should never be any that are freely entered into? Let people go that far then, and tell us what should be substituted for free will and consent freely given. Will it be coercion, for outside of freedom, I do not know of anything other than coercion? No, will come the answer, it will be the judgment of a third party. I am quite happy with this on three conditions. These are that the decision of this other person, whatever name he is given, will not be executed by coercion. The second condition is that he will be infallible, for to replace one form of fallibility by another is not worth it, and the fallibility I distrust the least is that of the person involved. Finally, the third condition is that this person should not be paid, for it would be a strange way of showing his sympathy for the borrower by first of all violating his freedom only to burden him with an extra charge in payment of this philanthropic service. But let us set aside the question of law and go back to political economy.

Capital, whether in the form of materials, provisions, or tools, has two aspects: utility and value. I would have set out the theory of value[649] very badly if the reader did not understand that the person who hands over capital is paid merely for its value, that is to say, for the service it provides, in other words, the trouble taken by the person handing it over together with the trouble spared to the person receiving it. Capital, indeed, is a product like any other. It acquires this name only from what happens to it later on. It is a great illusion to believe that capital exists in its own right. A sack of wheat is a sack of wheat even though, depending on your point of view, one person sells it for income and another buys it for capital. The exchange takes place on the following invariable principle: value for value and service for service, and everything that enters the sphere of gratuitous utility is given into the bargain, it being clear that what is free has no value and that value alone is taken into account in transactions. In this, the transactions that relate to capital are no different from any other.

The result of this is that, in the social order, there are some remarkable implications to which I can make only passing reference here. Man living in isolation has capital only when he has gathered a stock of materials, provisions, and tools. This is not the same for man living in society. It is enough for him to have provided services, and thus have the right to draw equivalent services from society through the apparatus of exchange.[650] What I call the apparatus of exchange is money (cash), bank paper, bank notes, and even bankers. Whoever has rendered a service and has not yet received the corresponding satisfaction is the bearer of a claim either based on value, like cash, or on trust, like bank notes, that gives him the right to draw an equivalent service from the social bank[651] at a time and place and in a form that suit him. This does not change in the slightest the great economic law I seek to elucidate, either in terms of principles and effects or from the legal point of view: Services are exchanged for services. We still have what was barter in its embryonic form, now more developed, grown larger and more complicated, without ever ceasing to be itself.

The bearer of the claim may thus draw from society at will either an immediate satisfaction or an object, which from his point of view has the character of capital. The person handing over this object does not concern himself with this character in the slightest. The only thing considered is the equivalence of the services, that is all.

He may also hand over his claim to another (person) to do with it what he chooses, on the twin condition of its restitution and (the rendering of) a service at (some) fixed date. If you go into the matter in detail you will find that in this case the person handing over the claim is depriving himself in favor of the person receiving it, either of an immediate satisfaction that he is postponing for several years or of a tool for production that would have increased his powers, got natural resources to cooperate, and improved the ratio of satisfaction to effort in his favor. He is depriving himself of these benefits to give them to someone else. This is certainly rendering (a) service, and it is not possible in all good justice to regard this service as lacking the right to mutuality. Pure and simple restitution in a year’s time cannot be considered to be (sufficient) remuneration for this special service. Those who support this do not understand that it is not a question here of a sale in which, since delivery is immediate, remuneration is also immediate. A delay is involved. And the delay in itself is a special service,[652] since it imposes a sacrifice on the person granting it and confers a benefit on the person asking (for) it. Remuneration is thus due, or else the supreme law governing society, service for service, has to be abandoned. It is this remuneration that takes a variety of forms depending on the circumstances: house rent, land rent, or other income,[653] but whose generic name is interest.[654]

Thus, and this is a wonderful thing, thanks to the marvelous mechanism of exchange, any service is or may become capital. If workers have to begin to construct a railway in ten years’ time, we cannot start today to amass in kind the wheat that will feed them, the linen that will clothe them, and the wheelbarrows they will use during this lengthy operation. However, we can save and pass on to them the value of these things. To do this, it is enough to provide society with services now and draw against them claims only, which will be converted into wheat and linen in ten years’ time. It is not even essential for us to leave these claims to slumber unproductively in the meantime. There are traders, there are bankers, and there are mechanisms[655] in society, which, in return for services, provide the service of imposing these privations on themselves in our place.

What is even more surprising is that we can carry out the operation in reverse, however impossible this may seem at first sight. We can convert into work tools, into railways and houses, a form of capital that is not yet in existence, thus using services that will not be rendered till the 20th century. There are bankers who will make advances in respect of these in the belief that workers and travelers three or four generations away will provide the payment, and these claims on the future will be handed on from one person to another without ever remaining unproductive. I confess that I do not think that the inventors of artificial forms of society, however numerous they are, ever dream of anything at once so simple and complicated, or so ingenious and so just. They certainly would renounce their dreary, ponderous utopias if they knew about the beautiful harmonies of the social mechanism (which have been) instituted by God. A King of Aragon also tried to come up with some advice he would have given to Providence concerning the celestial mechanism, had an appeal been made to him for his counsel.[656] This impious thought is not something Newton would have conceived.

But it has to be said that all transfer of services from one point to another in space and time, are based on this concept that giving (someone) time to repay is to render a service, in other words, on the legitimacy of interest. The man who in our time[657] wished to eliminate interest payments did not understand that he was returning exchange to its embryonic form, (namely) barter, barter now in the present, with no future and no past. He did not understand that while thinking he was ahead of everyone he was the most retrograde of men, bent on reconstructing society on its most primitive foundations. He wanted, as he said, the mutuality of services.[658] However, he began by removing the character of service precisely from that aspect of services that binds, links, and creates solidarity between all places and times. Of all the socialists, he is the one who, in spite of the daring of his eye-catching aphorisms,[659] has best understood and respected the current order of society. His reforms are limited to a single negative one. It consists in eliminating the most powerful and marvelous of its parts[660] from society.

I have explained elsewhere the legitimacy and perpetual nature of interest.[661] I will merely recall here that:

1. The legitimacy of interest is based on this fact: The person who gives time to repay is rendering a service. Interest is therefore legitimate by virtue of the principle, service for service.

2. The perpetual nature of interest rests on this other fact: The person who borrows has to give back the entirety of what he has borrowed at the due date. Now, if either the object or its value is handed back to its owner, he is able to lend it again. It will be returned to him a second time and he will be able to lend it for a third time, and so on perpetually. Which of these successive and willing borrowers has anything to complain of?

Since the legitimacy of interest has been sufficiently disputed lately to terrify capital and persuade it to hide and flee,[662] may I be allowed to show how senseless this strange public outcry is?

First, is it not as absurd as it is unjust that payment be identical either when people ask for and obtain one year, two year, or ten year terms, or none at all? If, unfortunately, under the influence of the so-called egalitarian doctrine, our laws required this, an entire category of human transactions would be eliminated at a stroke. There would still be barter and sales for cash, but there would no longer be any sales made on credit or loans. Egalitarians would release borrowers from the burden of interest, it is true, but by depriving them of the loan. On this basis, people might also be relieved of the inconvenient necessity of paying for what they purchase. All you have to do is to forbid them from making purchases, or what amounts to the same thing, have the law declare that prices are illegal.

The egalitarian principle has indeed something egalitarian about it. First of all, it would prevent capital from being accumulated, for who would want to save something that provides no benefit? Next, it would reduce wages to zero, for where there is no capital (tools, materials, and provisions), there can be no work for the future nor any wages. We would soon therefore achieve total equality, that of nothingness.

But what man can be so blind as not to understand that a delay in payment is in itself a costly arrangement, and that consequently has to be paid for? Even apart from the loan, doesn’t everyone make an effort to shorten they delays (in payment)? This is one of our constant preoccupations. Any entrepreneur pays a great deal of attention to the time when he will be paid for his advances. He sells for a greater or lesser price, depending on whether the due date is close or distant. To disregard this point, one would have to be unaware that capital is a force, for if one were aware of this, one would naturally want it to accomplish its allotted task as speedily as possible so as to be able to invest it in a new project.

Those who believe that we pay the interest on capital only when we borrow it are very poor economists. The general rule, based on justice, is that the person receiving the satisfaction has to bear all the costs of production, including delays (in repayment), whether he provided this service to himself or has it provided by someone else. A man living in isolation who does not deal with anyone, would consider any situation that deprived him of his weapons for a year as costly. Why therefore should a similar situation not be considered costly when it occurs in society? If a man submits voluntarily to this situation for the benefit of another who agrees to pay, what makes this payment illegitimate?

Nothing would be done in this world, no enterprise that required advances would be accomplished, no-one would plant anything, sow anything, or plow if the delay (in repayment)], in itself, was not considered to be a circumstance that had a price and was not treated and paid for as such. Universal agreement is so unanimous on this point that there is not a single exchange where this principle is not dominant. Delays (in repayment) and late payments are included in the evaluation of the services (rendered), and consequently in the amount of value they have.

Thus in their crusade against interest, egalitarians trample not only on the simple notions of justice, not only on their own principle of a service for a service, but also on the authority of the human race and universal practice. How do they dare lay open to public gaze the boundless pride presupposed by such pretension? Is it not very strange and sad that sectarians adopt this implicit and often explicit posture: From the dawn of time, everyone has been mistaken except for me? Omnes, ego non.[663]

May I be forgiven for having stressed the legitimacy of interest based on the axiom: Since delays are costly they have to be paid for; to cost something and to pay for something are correlative terms? The fault lies in the spirit of our age. We have to be on the side of vital truths accepted by the human race but undermined by a few fanatical innovators. For a writer who aspires to reveal a harmonious collection of phenomena, believe me it is painful to have to stop every minute to elucidate the most elementary notions. Would Laplace[664] have been able to set out the system of planetary motion in all its simplicity if there were not common and accepted notions held by his readers and if, in order to prove that the earth spins, he had first to teach them to count? Such is the hard choice of the economist in our era. If he does not go over the basics they are not understood, and if he explains them the torrent of details results in the simplicity and beauty of the whole being lost to sight.

And really, it is fortunate for the human race that interest is legitimate.

Without that, it too would be faced with a harsh alternative: Perish by remaining just or progress by means of injustice.

All industry is a collection of (joint) efforts. However, there is an essential distinction to be made among the various efforts. Some relate to services that have to be supplied now and others to an indefinite series of similar services. Let me explain.

The trouble taken in one day by a water carrier has to be paid for by those who benefit from such effort, but payment for the trouble he has taken to make his wheelbarrow and cask has to be shared among an unknown number of consumers.

In the same way, sowing, weeding, plowing, harrowing, harvesting, or threshing concern only the current harvest, while fencing, land clearance, drainage, building, or fertilizing concern and facilitate an unknown series of future harvests.

In accordance with the general law of service for service, those for whom the satisfaction is intended have to pay for the efforts that have been made on their behalf. As for the efforts of the first category, there is no problem. They are negotiated and evaluated between those who make them and those who benefit from them. But how are the services included in the second category to be evaluated? How can a fair proportion of the long-term investments, general overheads, or fixed capital costs, in economists’ jargon, be spread over the entire series of satisfactions they are intended to achieve? Through what procedure will the weight of these be placed fairly on all the buyers of water until the wheelbarrow is worn out and on all the buyers of wheat for as long as the field provides it?

I do not know how the problem would be solved in Icaria[665] or in the Phalanstery.[666] But it may be thought that the people who invent forms of society and are so rich in artificial arrangements and so prompt to impose them by law, that is to say by coercion, whether they acknowledge this or not, could not imagine a more ingenious solution than the perfectly natural procedure that men have thought up for themselves (how daring of them!) since the dawn of time and that people today wish to forbid. The procedure in question is this; it stems from the law of interest.

Let us suppose that a thousand francs have been used to improve some land, at a rate of interest of five percent and with an average harvest of fifty hectoliters. On the basis of this data, one franc would have to be levied on each hectoliter of wheat.

This franc is obviously the legitimate reward for a genuine service provided by the landowner (whom we might call a worker) as much to the person who will be acquiring one hectoliter of wheat in ten years’ time as to the one who buys it today. The law of strict justice has thus been observed.

If the durable effects of improvements to land or the durability of wheelbarrows or casks should be only roughly calculable, depreciation is added to the interest so that the landowner is not out of pocket and is able to start again. The law of justice still governs.

It should not be thought that the franc of interest levied on each hectoliter of wheat is invariable. No, it represents a value, and is subject to the law of value. It increases or decreases depending on the changes in supply and demand, that is to say, on the the requirements of the time and the general prosperity of society.

We are generally led to believe that this type of remuneration tends to increase, if not with regard to industrial improvements, at least with improvements to private property in land. It is said that, while the assumption is that this rent was just at the start, it ends up by becoming excessive, since the landowner, who from now on remains idle, sees it increase year by year because the mere increase in the population implies an increase in the demand for wheat.

I agree that this trend exists; it is not specific to rent from private property in land but, rather, common to all types of work. There is not one whose value does not increase with the density of the population[667] and a simple laborer earns more in Paris than in Brittany.[668]

Furthermore, with regard to rent from land, the trend under discussion is strongly counterbalanced by an opposing trend, that of progress. An improvement achieved today through more advanced means, obtained with less human labor and at a time when interest rates have decreased, will prevent all former improvements from raising their demands too high. A landowner’s fixed capital, like that of an industrialist, deteriorates over time because of the introduction of equipment whose performance is increasingly high for a given outlay. This is a magnificent law that overturns Ricardo’s pessimistic theory;[669] it will be set out in greater detail when we deal with private property in land.[670]

Note that the problem of distributing payments for services arising from permanent improvements can be resolved only by the law of interest. A landowner could not divide the actual sum of capital payments due among this or that number of successive purchasers, for where would he stop, since the number is unknowable? The first would have paid for the last, which would not be just. What is more, the time would have come when the landowner had received (back) both the capital and the improvement, which is not just either. Let us accept therefore that the natural social mechanism is sufficiently ingenious for us to dispense with substituting an artificial one for it.

I have presented the phenomenon in its simplest form in order for its nature to be understood. In practice, things do not happen quite like this.

The landowner does not manage the gathering of these returns himself. It is not he who decides that a franc more or less will be levied on each hectoliter of wheat. He finds that everything in the world is, so to speak, a given, including both the average price for wheat and the rate of interest. On the basis of this information he decides what to do with his capital.[671] He will devote it to improving his land if he thinks that the price of wheat will enable him to obtain the normal rate of interest. If not, he will commit it to some more lucrative industry, one which for this very reason is more attractive to capital, in the social interest. This process, which is the true one, achieves the same result and is another form of harmony.

The reader will understand that I have limited myself to one particular event only to elucidate a general law, one to which all all occupations are subject.

For example, a lawyer cannot have himself repaid for the cost of his education, his period as an articled clerk,[672] and initial establishment, which comes perhaps to some twenty thousand francs, by the first client whom he lays his hands on. Apart from the fact that this would be unjust, it could not be done; he would never obtain a first client and our Cujas[673] would be reduced to imitating the host who, seeing that no one came to his first ball, said: “Next year, I will start with (my) second (ball).”

This is true for traders, doctors, ship owners, and artists. In every form of career, the two categories of effort are found; the second requires of necessity a sharing of costs over an unknown number of clients, and I challenge anyone to imagine such a way of sharing outside the mechanism of interest.

In recent times, considerable effort has been made to whip up public aversion to capital, “infamous and infernal capital." It is represented to the masses as being a devouring and insatiable monster, more destructive than cholera,[674] more terrifying than riots, and one which acts on the social body like a vampire whose power to suck blood increases indefinitely all by itself. Vires acquirit eundo.[675] The tongue used by this monster is called rent, usury, house rent, land rent, and interest. A writer, who might have become famous through his exceptional capacities and who preferred to achieve this through his paradoxes,[676] was pleased to toss one to a crowd already aflame with revolutionary fever. I too have an apparent paradox to put to the reader and ask him to see whether it is not a great and reassuring truth.

But before this, I have to say something about the way Mr. Proudhon and his school explain what they call the illegitimacy of interest.

Capital is one of the tools of labor. The purpose of these tools is to ensure the contribution of the gratuitous forces of nature. With steam engines, the elastic pressure of gas is used; with watch springs, the elasticity of steel; with weights or waterfalls, gravity; with a Voltaic battery, the speed of an electrical spark; with soil, the chemical and physical compounds that we call plants, etc. etc. Well, by confusing utility with value, we assume that these natural resources have a value that belongs to them and that consequently those who make use of them ensure that they are paid for their use, since value implies payment. We think that one amount is levied on products to pay for human services, which we accept as just, and another amount for the services of nature, which we reject as being unjust. Why, we say, should gravity, electricity, plant life, elasticity, etc. be paid for?

The answer is to be found in the theory of value. The class of socialists that has taken the name of egalitarians confuses the legitimate value of the tool, born of human service, with its useful result, always gratuitous, once this legitimate value or the interest that relates to it, have been deducted. When I pay a farmer, a miller, or a railway company, I am giving nothing, absolutely nothing to pay for the phenomenon which is plant life, gravity, or the elasticity of steam. I am paying for the human work that has had to be put in to making the tools by means of which these forces are constrained to operate or, which is worth more to me, I am paying the interest on this labor. I am rendering one service for another, in return for which the useful action of these forces is totally to my benefit and free of charge. It is exactly the same as in an exchange or a simple barter. The presence of capital does not change this law, for capital is nothing other than an accumulation of values, of services which have been given the special mission of making nature cooperate.

And now here is my paradox:

Of all the component parts that make up the total value of any product, the one that we should pay for with the greatest pleasure is the very part known as interest (which is paid for) the advances (which have been made), or on capital.

Why? Because this part makes us pay for things (only) once and saves us from paying twice. This is because, by its very presence, it records (the fact) that natural forces have contributed to the final result without their contribution having to be paid for; because, as a result of this, the same general utility is made available to us, with the difference, fortunately for us, that a certain element of gratuitous utility has been substituted for the onerous utility; (and) because, in a word, the price of the product has fallen. We acquire it for a smaller part of our own labor and the same beneficial thing that happens to a man living in isolation who produces an ingenious invention, now happens to whole society.

Take a modest laborer[677] who earns four francs a day.[678] With two francs, that is to say, half a day’s work, he buys a pair of cotton socks. If he wanted to obtain these socks directly, by his own labor, I truly believe that his entire life would not have been long enough to do this. How is it then that half a day pays for all of the human services provided to him on this occasion? According to the law of “service for service," how is it that he is not obliged to devote several years of work to this?

The answer is that this pair of socks is the result of services provided by people, whose share has been enormously reduced by (the use of) natural resources (made possible) by the introduction of capital. However, our laborer is paying not only for the present labor of all those who have contributed to this product, but also the interest on the capital that secured the cooperation of nature. And what should be noted is that, without this latter payment, or if it were to be declared illegal, capital would not have been able to call upon (the necessary) natural resources, the product would (have) include(d) only the utility that had to be paid for, it would be the result solely of human labor, and our workman would be right back at his starting point, that is to say, faced with the choice of either doing without socks or paying for them at the price of several years’ work.

If our laborer had learnt to analyze phenomena, he would certainly become reconciled with capital, seeing how much he owes it. He would be convinced above all that God’s free gifts had been specifically aimed at him and that these gifts had been given with a prodigality that is due not to his own merit but to the beautiful mechanism of the natural social order. Capital is not the biological force that causes cotton to germinate and flower, but the trouble taken by the person planting it. Capital is not the wind that swells the sails of a ship nor the magnetism that acts on the compass, but the trouble taken by the sail maker and compass-maker. Capital is not the compressibility of the steam that drives the spindles in factories but the trouble taken by the person who has built the machines. Vegetation, the strength of the wind, magnetism, and (the) compressibility (of steam) are certainly all free and this is why the socks have such little value. As for the collection of trouble taken by the planter, sail maker, compass-maker, builder, sailor, manufacturer, or trader, this is distributed, or rather, insofar as it is capital that is being used, interest on it is shared, among countless buyers of socks, and this is why the portion of labor handed over by each of them is so small.

Truly, when you modern reformers[679] wish to replace this admirable order with a system that you have invented, there are two things (and they come down to just one) that disconcert me: your lack of faith in Providence and your faith in yourselves; your ignorance and your pride.

The result of what has gone before is that the progress of the human race coincides with the rapid accumulation of capital, for to say that new capital is established is to say in other words that obstacles that were in the past onerously combatted by labor are now being combated by nature free of charge, and this, (please) note clearly, is not to the benefit of capitalists but that of the community.

If this is so, the overriding interest of each person (from the economic point of view, of course) is to encourage rapid capital formation. However, capital increases, so to speak, on its own, under the threefold influence of activity, frugality, and security. We can scarcely exert direct pressure on the activity and frugality of our fellow men unless we do so through public opinion that is to say by an intelligent expression of a our concerns and preferences.[680] But we can do a great deal to further security, without which capital, far from being accumulated, will hide, flee, and destroy itself, and in this we see the element of suicide in the ardor shown by the working class on occasion for disturbing the public peace.[681] They should be fully aware that capital from the outset has worked to free men from the yoke of ignorance, need, and despotism. To terrify capital is to weld a triple (iron) chain on to the arms of the human race.

The (phrase) vires acquirit eundo (it gathers strength as it goes on) is very applicable to capital and its beneficial influence. All capital formation by definition makes available both work and payment for this work. It thus carries within itself a progressive power. There is something in it that resembles the law of momentum. And this, perhaps, is what economic science has perhaps omitted up to now to use to counter the other progression noted by Malthus.[682] It is a harmony that we cannot discuss here. We will keep it for the chapter on Population.[683]

I must warn the reader against a fallacious objection. He may say that if the function of capital is to have nature execute what used to be carried out by human labor, then whatever good it does to the human race, it has to damage the working class, in particular those who live on their wages, for anything that makes (more) human hands available (for work) stimulates the competition between them and doubtless this is the secret reason for the opposition of the proletariat to (the) capitalists.[684] If the objection were well founded, there would indeed be a discordant note in social harmony.[685]

The illusion lies in our losing sight of the following: As its (sphere of) action expands, capital makes available a certain quantity of human effort only by making available a corresponding quantity of remuneration, so that these two elements combine and satisfy each other. Labor is not blighted by inertia; as it is replaced by gratuitous energy in a given task, it attacks other obstacles to the general work of progress with all the more certainty that its means of payment have already been well prepared within the community.

Indeed, taking the above example again, it is easy to see that the price of socks (like the price of books, transport, and everything else) decreases under the effect of capital only by leaving in the buyer’s hands part of the former price. There is even a pleonasm here that is almost puerile. A laborer who pays 2 francs for what he used in the past to pay 6 therefore has 4 available (to spend elsewhere).[686] Well, it is precisely in this proportion that human labor has been replaced by the forces of nature. These forces are therefore a pure and simple advance, which does not change the relationship between work and available pay in the slightest. The reader should recall that the answer to this objection was prepared in advance[687] when, on observing a man living in isolation or reduced to the primitive law of barter, I warned him against the very common illusion that I am endeavoring to do away with here.

Let us then allow capital to be created without fear, and to increase in line with its own tendencies and those of the human heart. Let us not imagine that when manual labourers save for their old age, when fathers of families contemplate the careers of their sons or the dowries of their daughters, they are exercising this noble capacity of man, foresight, only at the expense of the general good. If this were so, if capital and work were incompatible, private virtue would be in conflict with the general good.

Far from the human race being subjected to this contradiction, let us even say, about this impossibility (for how can we conceive of progressive harm in an entity that results from the progressive good of its parts?), it has to be recognized that, on the contrary, Providence, in its justice and goodness, has reserved a greater share of progress for labor than for capital, more effective incentives and more liberal rewards for him who currently works by the sweat of his brow than for him who lives on the sweat of his forebears.

Indeed, given that any increase in capital is followed by an inevitable increase in general well-being, with reference to the distribution of this well-being I dare to state as unshakeable the following axiom:

As capital accumulates, the capitalists’ absolute share in total production increases and their relative share decreases. On the other hand, workers see their share in both categories increase.

I will make my idea better understood using figures.

Let us represent the total production of society in successive periods by the figures 1,000, 2,000, 3,000, 4,000 etc.

I hold that the return to capital will decrease successively from 50 percent of the total to 40, 35 and 30 percent while the share going to labor will consequently increase from 50 percent to 60, 65 and 70 percent. The pattern will be such, nevertheless, that capital’s absolute share is always greater in each period while its relative share is smaller. Thus, the share will be as follows:

 

Total product

Capital’s share

Labour’s share

1st period

1,000

500

500

2nd period

2,000

800

1200

3rd period

3,000

1050

1950

4th period

4,000

1200

2800

This is the great, admirable, reassuring, essential and inflexible law of capital. Demonstrating it here, I think, will discredit the outbursts that have assaulted our ears for so long, against the greed and tyranny of the most powerful tool of civilization and equality produced by human powers.

This proof is in two parts. First of all, we have to prove that capital’s relative share constantly decreases.

This will not take long for it is the same as saying: The more capital there is, the lower the interest rate. Well, this is a fact that is incontrovertible and uncontested. Not only is this explained in terms of economic science but it is also blindingly obvious. The most eccentric schools acknowledge this; the one that has set itself up especially as the opponent of infernal capital makes this the basis of its theory,[688] for it is from this visible decrease in interest (rates) that it deduces its inevitable elimination. It says that since this elimination is inevitable, since this has to occur within a given time, since it implies the achievement of absolute good, it has to be hastened and decreed (in law). This is not the place to refute these principles and the deductions drawn from them. I merely state that all the schools of economists, socialists, egalitarians and others, accept, in fact, that in the natural order of society, interest rates decrease as capital becomes increasingly abundant. If it pleased them not to acknowledge this, the fact would still be no less true. The fact has the authority of the human race on its side and the perhaps involuntary acceptance of all capitalists around the world. It is a fact that the interest on capital is less high in Spain than in Mexico, in France than in Spain, in England than in France and in Holland than in England. Well, when interest (rates) decrease from 20 percent to 15 percent and then to 10, to 8, to 6, to 5, to 4 ½, to 4, to 3 ½ and to 3 percent, what does that mean with reference to the question under discussion? It means that, for the contribution it makes to industrial production and to the achievement of well-being, capital is content, or if you like, is obliged to content itself with an increasingly reduced share the more it accumulates. Did it start with a one-third share of the value of wheat, houses, linen, ships, and canals? In other words, when these things were sold, did one third of the proceeds go to capital and two thirds to the workers? Little by little, capitalists will no longer receive more than one quarter, one fifth or one sixth. Their relative share decreases, and that of the workers increases in the same proportion; the first part of my demonstration has thus been made.

It remains for me to prove that capital’s absolute share increases constantly. It is perfectly true that interest rates tend to decrease. But when do they and why? When and because capital formation increases. It is therefore highly possible that the total contribution increases, even though as a percentage it decreases. An individual receives a greater return from 200,000 francs at 4 percent than from 100,000 francs at 5 percent, although in the first instance he charges the workers less for the use of his capital. The same applies to a nation and to the entire human race. Well, I state that the tendency for the percentage to decrease ought not and cannot follow a course so rapid that the total sum of interest is lower when capital is abundant than when it is scarce. I am quite willing to admit that if the capital of the human race is represented by 100 and interest by 5, this interest would be only 4 when the capital has increased to 200. Here we see the simultaneous nature of the two effects. A lower relative share and a greater absolute share. However, my hypothesis does not allow for an increase in capital formation from 100 to 200 to effect a decrease in the rate of interest from 5 percent to, for example, 2 percent. For if this happened, the capitalist who had 5,000 francs return from 100,000 francs of capital, would have only 4,000 francs of rent from 200,000 of capital. This result is contradictory and impossible, a strange anomaly whose remedy would be most simple and pleasant; in order to increase his returns, it would be enough for him to devour half his capital. What a fortunate and strange era it would be if we were able to grow richer by making ourselves poorer!

We must not, therefore, lose sight of the fact that the combination of these two correlative events, the increase in capital and the decrease in rates of interest takes place of necessity in such a way that total production constantly increases.

And we should note in passing that this radically and absolutely destroys the illusion of those who imagine that because interest (rates) decrease its tendency is toward (its) elimination.[689] This would result in the coming of a day when capital would be developed to such a degree that it would generate nothing for its owners. Do not worry: before this time comes, the owners of capital would have hastened to dissipate their funds in order to regenerate their income.

Thus the great law of capital and labor, with regard to the share of the product of (their) co-operation, has been settled. Each of them has an absolute share that is increasingly greater, but the proportional share of capital constantly decreases compared with that of labor.

Capitalists and workers, you should therefore stop looking at each other with suspicion and envy. Shut your ears to the absurd oratory, whose pride is unequalled except perhaps by ignorance, which, on the promise of future philanthropy, starts by whipping up disharmony today. Acknowledge that you have common and identical interests, whatever anyone says, and that these interests are combined and together tend to move toward the achievement of the general good, that the hard labor expended by the present generation is added to that expended by generations past, that it is truly necessary for part of the remuneration to go to those who have contributed to the final product, and that the most ingenious as well as just (method of ) distribution (of this) is taking place among you (now) by (means of) the wisdom of providential laws, in the system of free and voluntary transactions without any parasitical sentimentalism having to impose its decrees on you at the expense of your well-being, liberty, security, and your dignity.

Capital is rooted in three attributes of man: foresight, intelligence, and frugality. Indeed, in deciding to accumulate some capital he has to foresee the future, sacrifice the present to it, exercise admirable self-control over his appetites, resist not only the attraction of current enjoyment but also the pinpricks of vanity and the caprices of a public opinion that is always so biased towards carefree and prodigal characters. In addition, effects have to be linked to causes, and he has to know by what industrial processes and tools nature will allow itself to be tamed and harnessed to the work of production. Above all, he has to be imbued with a family spirit and not give way in the face of sacrifice whose fruit will be gathered by the beloved people he will leave behind. Accumulating capital is to prepare the livelihood, board, lodging, leisure, education, independence, and dignity of future generations. None of this can be done without an exercise of the most social of virtues, and what is more without making them a habit.

Nevertheless it is very common to attribute to capital a sort of deadly efficiency, the result of which is to introduce selfishness, hardness, and Machiavellianism in the hearts of those who aspire to (get) it or who (already) possess it. But are we not mixing things up? There are countries in which labor leads nowhere. The little you earn has to be shared with the tax authorities.[690] In order to snatch from you the fruit of your labors, what is known as the state entangles you in a whole net of restrictions. It meddles in all your business and interferes in all your transactions. It governs your mind and your faith. It displaces all interests[691] and puts everyone into an artificial and precarious position. It enervates individual activity and energy by taking over the direction of everything. It causes responsibility for action to fall on those it should not, so that, gradually, the notion of what is just and unjust is effaced. It engages the nation, through its diplomacy, in all the disputes around the world and then sends in the army and navy. It misleads as far as it can the minds of the masses with regard to economic questions[692] because it needs to make them believe that its wild expenditure, unjust aggression, conquests, and colonies are a source of wealth for them. In these countries, capital has great trouble in being established naturally. What people aspire to most is to take it by force and fraud from those who have created it. In these places, people are seen to enrich themselves through war, the civil service,[693] gambling, government contracts, rigging the market, commercial fraud, risky enterprises, public contracts, etc. The qualities required for snatching capital from the hands of those who have established it are precisely the opposite of those necessary for creating it. It is therefore not surprising that in these countries a form of association of the following two ideas is created: capital and selfishness,[694] and this association becomes indestructible if all the moral notions in this country are drawn from the history of antiquity and the middle ages.

But when thought is given not to the theft of capital but to its formation through thoughtful action, foresight, and frugality, it is impossible not to recognize that social and moral virtue is part of its acquisition.

If there is moral sociability[695] in the formation of capital, there is no less of this in its action. Its own effect is to cause nature to co-operate, to free man from what is most physical, muscular, and brutal in the work of production, to cause the role of the mind to be increasingly predominant, to widen the share, not of idleness, but of leisure,[696] to make less and less pressing the voice of rough need, through the ready availability of satisfaction, and substitute for them higher forms of enjoyment, ones that are more delicate, purer, more artistic, and more spiritual.

Thus, whatever your point of view, whether you consider capital from (the point of view of) its relationship with our needs that it ennobles, with our efforts that it relieves, with our satisfactions that it purifies, with nature that it overcomes, with morality whose habits it changes, with sociability that it develops, with (the) equality that it stimulates, with (the) freedom from which it draws life, (or) with the justice it achieves through the most ingenious methods, everywhere, always, and on condition that it is accumulated and used in a social order that is not deflected from its natural path, we will recognize in it the stamp of all the great laws of Providence: (namely) harmony.

 


 

VIII. Property and Community

Translator’s Note

This chapter provides several challenges to the translator. The two previous translators, Stirling and FEE, were not consistent in the way they handled some of the linguistic and theoretical difficulties thrown up by Bastiat, something which will try to avoid here.

It is one of the more original chapters in the EH, along with the chapters on value (his incipient subjective value theory), rent (land rent was not the result of an “unearned” gift of the soil and thus there was nothing “unearned” or special about it), exchange (the mutual exchange of services), and population (the Malthusian population trap could be avoided by free trade and rational individual planning). The very title of this chapter, “Propriété, Communauté” (literally, “Property, Community," poses a challenge. Stirling translated it as “Property-Community," while FEE translated it as “Private Property and Common Wealth,” neither of which quite captures the complexity of what Bastiat was trying to discuss.[697]

Part of the problem comes from the French practice of using fairly terse abstract nouns where English would use more nuanced combinations of adjective and nouns to express complex terms. For example, “Propriété” could be translated just as “Property” (as Stirling did) or as “Private Property” (as FEE did and as we also prefer to). “Communauté” could be translated as “Community” (Stirling), as “Communality” (as one of our translators preferred), as “Common Wealth," the communal domain, or common to all (FEE), as common ownership (one of our uses as well), or simply “The Commons.” So, just the title of the chapter, without going any further, could be translated in various way, such as “Private Property and the Community,” “Private and Communal (or Common) Property, or “Private Property and Common Wealth.”

We have decided upon four main ways to translate this complex term, several of which have to have a accompanying adjective to make their meaning clearer (hopefully) and as the footnotes will explain:

1. there is “community” in the general sense of a group of people

2. his use of a liberal idea of “community” which he uses when he is criticizing the communist idea of community (as in a “community of goods” which are shared), and he revels in the fact that there is a similarity in the sound of the words which he uses to good rhetorical effect (as was his custom)

3. his idea that as the economy develops and expands there is increasingly “a common availability of things” or an increase in “what is common to all”

4. then there is the inevitable temptation for a scholar steeped in the Anglo-American tradition to interpret “la communauté” as a French way of describing what was known for centuries in the English speaking world as “the Commons.” We have limited ourselves to using this term only in the formal phrase “la domaine de la communauté” (the domain of the Commons). Elsewhere we have used one of the other terms listed above.

For further discussion see “Property and Community” in Appendix 1.

Text

Recognizing what is incontestably in the soil, in natural resources, and the tools of labor – the ability to create utility – I have endeavored to remove what is wrongly attributed to them: (namely,) the ability to create value, (which is) an ability applicable only to the services that individuals exchange with each other.

At the same time as this very simple correction strengthens property by restoring its true nature, it reveals an extraordinary fact to economic science and, unless I am mistaken, one still unknown to it, the existence of a genuine, necessary, and expanding community[698] (which is) the providential result of any social order under a regime of freedom and whose obvious aim is to lead all men, like brothers, from primitive equality, which is one of penury and ignorance, to the ultimate equality, (which is) the possession of well-being and truth.

While this radical distinction between the utility of things and the value of services is (both) true in itself as well as in its conclusions, it is impossible for its significance to be misunderstood, for it leads to nothing less than the inclusion of utopian ideas in economic science and the reconciliation of conflicting schools (of thought)[699] in a common faith that satisfies all minds and all aspirations.

Men of property and leisure! at whatever social level you have attained as a result of your actions, your honesty, order, and thrift, from which direction does the trouble assailing you come? Oh, the scented but poisoned perfume of utopia threatens your existence! It is said, it is shouted aloud, that the goods amassed by you to ensure some rest in your old age, as well as bread and the education and careers of your children, have been acquired at the expense of your brethren; it is said that you have come between the gifts of God and the poor, that, like greedy tax collectors, you have levied a tax on these gifts under the name of (private) property, interest, (land) rent, and (house) rent, that you have seized, in order to sell them, these benefits that our common father has showered on all his children. You have been called upon to make restitution, and what increases your consternation is that your lawyers’ defense all too often includes the implicit admission that (this) usurpation is flagrant but necessary. For my part, I say: No, you have not seized the gifts of God. You have gathered them gratuitously from the hands of nature, that is true, but you have also gratuitously transmitted them to your brethren without keeping anything back. They have acted similarly toward you and the only things that have been mutually compensated for are the physical or intellectual efforts, the sweat expended, the dangers faced, the skill deployed, the deprivations accepted, the trouble taken; the services received and rendered. You have perhaps thought only of yourselves, but your self-interest itself has been the instrument of an infinitely farseeing and wise Providence, and has served to expand the domain of the Commons[700] constantly within the human race, for, without your efforts, all these useful results that you have called upon from nature in order to spread them, without payment among other people, would have remained perpetually inert. I say without payment, for what you have received is just a simple restitution for your efforts and not at all the price of the gifts of God. So live in peace, without (any) fear or misgivings. You have no (other) property in the world other than your right to (receive) services in exchange for the services honestly provided by you and voluntarily accepted by your brethren. This type of property is legitimate and unassailable. No utopia will prevail over it, for it joins and blends with the very essence of our nature. No theory will ever succeed in either shaking it to the ground or withering it up.

Men of toil and hardship!, you cannot shut your eyes to the truth that the starting point of the human race was a complete community, (with perfect) equality of poverty, destitution, and ignorance. The human race worked its way out of this by the sweat of its brow and moved towards a another (kind) of community, one where the gifts of God (are) obtained increasingly with less effort, towards a new kind of equality, (where there is) well-being, enlightenment, and moral dignity.[701] Yes, the steps taken by man down this road to perfectibility[702] (were) unequal and you can complain only to the extent that the more rapid pace of those in front slowed yours down. But it is quite the opposite. No spark of knowledge comes to someone’s mind without lighting up to some extent your own mind. No progress is achieved as a result of the driving force of wanting to own property that does not result in progress for you. No wealth is accumulated which does not (also) tend to lead to your emancipation. (There is) no capital that does not (also) increase your enjoyment in proportion to your labor, (there is) no (purchase made by others) which does not make it easier for you to make purchases, (there is) no property which will not in the end expand the domain of the Commons for your benefit. The natural social order has been organized so artfully by the Divine Worker[703] that those most in the lead on the path to redemption will hold out a hand of assistance to you, whether voluntarily or unbeknown to them, whether they are aware of it or not, for He has ordained things in such a way that no man is able to work honestly for himself without at the same time working for everyone else. And it is strictly true to say that any attack made against this marvelous order would be not only an act of murder but (also) an act of suicide. The human race is an admirable chain in which this miracle is accomplished, (where) the first links cause all the others, right up to the very last one, to move faster and faster in an increasingly progressive direction.

Men of philanthropy, lovers of equality, blind defenders and dangerous friends of those who suffer and are left behind on the road to civilization! you who seek the reign of community in this world, why do you start by unsettling people’s minds and consciences? Why in your pride do you aspire to bend all wills under the yoke of your social inventions? Do you not see that God himself has thought of, and provided, the community which you sigh for as necessary for spreading the Kingdom of God on earth? Do you not see that He has not waited for you to provide His children’s inheritance, that he has no need of your designs, nor of your violence, and that this community is achieved on a daily basis because of His admirable decrees? Do you not also see that in order for His will to be executed, God has relied neither on the uncertainties of your childish arrangements, nor even on the increasing expression of the principle of fellow-feeling shown by charity, but has entrusted the achievement of His designs to the most active, the most personal, and the most lasting of our energies, (namely our) self-interest, in the certainty that the latter will never rest? (If you) examine the social mechanism as it has left the hands of the Great Mechanic;[704] you will afterwards be forever convinced that it reveals a universal solicitude far outstripping your dreams and illusions. Perhaps then you will be content to bless the divine work, instead of aspiring to remake it.

This is not to say that there is no place on this earth for reforms and reformers.[705] It is not to say that the human race ought not to call ardently for, and encourage with recognition, men of curiosity, men of science, and men of dedication, men whose hearts are faithful to democracy. They are still very much needed, not to overturn the laws governing society, but on the contrary to overcome the artificial obstacles that inhibit and pervert their action. Truly, it is difficult to understand how the following commonplace sayings can be repeated so often: “Political economy is optimistic with regard to the ways things are; it states that what ought to be (now) exists, and when faced with either good or evil it is content to say: laissez faire.” My goodness! Could we possibly fail to realize that the beginnings of the human race lay in poverty, ignorance, and the reign of brute force? Would we really express optimism in the face of this reality? Indeed! Would we fail to realize that the driving force of human beings is an aversion to any pain or tiredness, and that since work is tiring, the initial manifestation of self-interest in men was the shifting of the painful burden from one person to another? Is it conceivable that the words cannibalism, war, slavery, privilege, monopoly, fraud, plunder, or deception might never have reached our ears or that we would see in these abominations the mechanisms necessary for the work of progress? But is it not in some degree deliberate that all these things are confused, in a deliberate ploy to accuse us of confusing them? When we admire the providential law governing transactions, when we say that interests are in agreement, when we conclude from this that they naturally gravitate towards achieving relative equality and general progress, it is clearly from the action of these laws and not from their disturbance that we expect harmony.[706] When we say “laissez faire,” we clearly mean to say “let these laws act," and not “let these laws be disrupted." Depending on whether we conform to them or violate them, good or evil results; in other words, interests are harmonious, provided that each person remains within his rights and provided that services are exchanged freely and voluntarily for other services. But is this to say that we are unaware of the constant struggle between right and wrong? Is this to say that we are losing sight or that we approve of the efforts that have been made in all eras, and that are still being made, to change the natural equivalence of services either by force or fraud? This is precisely what we reject as constituting (the) violation of providential social laws or as attacks on property, for, in our eyes, the free exchange of services, justice, property, freedom, and security are all the same idea seen from various angles. It is not the principle of property that should be combated, but on the contrary the opposing, antagonistic principle, that of plunder. Property owners of every level, reformers of every school, this is the mission that ought to reconcile and unite us.

And it is time, it is high time that this crusade began. The ideological war about the theory of property is neither the most desperate nor the most dangerous. There has been a practical conspiracy against it from the dawn of time, and this is not about to stop. War, slavery, deception, excessive taxation, monopolies, privileges, commercial fraud, colonies, the “right” to a job, the right to credit, the right to (financial) assistance, the right to education, or progressive taxes based directly or inversely on one’s ability to pay, are so many battering rams that strike mighty blows on the rickety column, and can anyone tell me whether there are many people in France, even among those who consider themselves to be conservative, who do not put their hand in one way or another to the work of destruction?[707]

There are those in whose eyes property never appears in any other light than as a plot of land or a sack of money. Provided that the venerable boundary posts are not moved and that people’s pockets are not emptied physically, they are very reassured. But, is there not also the property one has in one’s “hands” (i.e. labour), one’s faculties, or one’s ideas; is there not, in a word, the property one has in one’s services?[708] When I toss a service into the social bank,[709] have I not the right, if I may express it thus, to have it remain suspended there in accordance with the laws governing its natural equivalence? To have it reach an equilibrium with any other service that people are willing to give me in exchange? We have by common agreement instituted the coercive power of the state to protect property thus understood. Where are we, then, if this very power believes that it has, and gives itself, the mission to upset this equilibrium on the socialist pretext that monopoly arises from freedom, that laissez faire is odious and heartless? When things come to this pass, individual theft may be rare and severely punished, but plunder is organized, legalised, and systematised.[710] Reformers, be reassured, your work is not ended; just try to understand it.

[gap between paras]

But before analyzing public or private plunder, (that is) legal or illegal (plunder), its role in the world, or its influence as an element of the social problem,[711] we have to form for ourselves (some) accurate ideas about (the nature of) community and (private) property, for as we will see, plunder is nothing more than the end point of private property, just as private property is the end point of community.[712]

From the preceding chapters, in particular the one dealing with utility and value,[713] we may deduce the following formula:

All men gratuitously enjoy all the utilities supplied or constructed by nature, on condition that they take the trouble needed to gather them or provide in return an equivalent service to those who rendered them with the service of taking this trouble on their behalf.

Here two facts are combined and merged together, although they are essentially distinct.

There are the gifts of nature, gratuitous (raw) materials, and gratuitous natural forces; this is the domain of the Commons.

In addition, there are human efforts devoted to gathering these materials and directing these natural forces; efforts that are exchanged, evaluated, and paid for; this is the domain of (private) property.

In other words, with regard to one another, we are not the owners of the utility of things but (the owners) of their value, and value is merely the assessment of reciprocal services.

(Private) property and what is common to all are two ideas that correlate to those of the onerousness and the gratuitousness from which they derive.

What is gratuitous is common to all, for everyone enjoys it and is allowed to enjoy it unconditionally.

What is onerous is appropriated, because (some) trouble (which has) to be taken is a condition of satisfaction, just as satisfaction is the reason for the trouble which is taken.

Is an exchange being carried out? It comes about through the evaluation of the two (instances) of the trouble (taken) and the two services (rendered).

This recourse to (some) trouble taken implies the idea of an obstacle. It can therefore be said that the object being sought comes closer to being gratuitous and common to all as the obstacle becomes smaller, since in accordance with our premises the total absence of an obstacle leads to complete gratuitousness and common availability.

Now, faced with a human race which is progressive and perfectible, obstacles can never be considered as a fixed and absolute quantity. They can be reduced (in size). Thus, the trouble it takes is reduced along with it; likewise the service (provided) diminishes with the trouble taken, as does the value with the service, and the property with the value.

But the utility remains the same: thus what was gratuitous and commonly available has gained everything that was onerous (to acquire) and privately owned.[714]

To get people to work a motive is needed. This motive is the satisfaction they have in view, or the utility (it provides). Their incontestable tendency is unwavering, (that is) to achieve the greatest possible satisfaction for the least amount of work possible and to ensure that the greatest utility goes hand in hand with the least amount of property, from which it follows that the function of property or rather the spirit of property[715] is to achieve an ever increasing common availability (of things).

As the starting point of the human race (was) the greatest depth of poverty or the greatest number of obstacles to be overcome, it is clear that everything it gains from one age to the next it owes to the spirit of property.

As this is so, is there anywhere in the world a single opponent to (the theory of) property? Do we not see that it is impossible to imagine any social force (which is) at the same time more just and more democratic? The fundamental dogma of Proudhon himself is the mutuality of services.[716] We agree. Where we differ is in this: I call this dogma property because, when I go to the bottom of things, I am sure that if men are free, they do not and cannot have any other property than that (property) in the value (of the things they have made) or the services (they have rendered). On the contrary, Proudhon, together with most economists, thinks that certain natural resources have value which is inherent (in them), and that consequently they are appropriated. But as for the property in services, far from disputing this property, it constitutes his entire faith. Is there anyone who still wishes to go further? Will people go so far as to say that a person ought not to be the owner of his own exertions? That in an exchange, it is not enough to hand over gratuitously the contribution of the natural resources, it is also essential to hand over gratuitously his own efforts? Be careful! This would be to glorify slavery, for to say that some people must render services that are not paid for is to say that certain other people ought to receive them, which is just slavery. If it is said that this gratuitousness has to be reciprocal, this is an incomprehensible play on words, for either there is an element of justice in the exchange, in which case the services will, one way or another, be evaluated and compensated for, or they will not be evaluated and compensated for, in which case some will give a great deal and others little, and we are back into slavery.

It is therefore impossible to dispute the legitimate property in services exchanged on the principle of equivalence. To explain this legitimacy, we do not need philosophy, science, law, or metaphysics. Socialists, economists, egalitarians, or advocates of fraternity, I challenge you, whatever your position, to raise even the shadow of an objection to the legitimate mutuality of voluntary services, and consequently to property as I have defined it and as it exists in the natural social order.

I certainly know that in practice property is still far from holding sway unreservedly; it is faced with opposition. There are services that are not voluntary and whose payment is not freely freely negotiated. There are services whose equivalence is degraded by force or fraud; in a word there is plunder. This does not call into question the legitimate principle of property but (only) confirms it. It is violated, therefore it exists. You either have to believe (in) nothing in this world, whether it be facts, justice, universal consent, or human language or you have to admit that the two words property and plunder[717] express opposing and irreconcilable ideas that can no more be identified than yes with no, light with darkness, good with evil, or harmony with disharmony. Taken literally, the famous formula: property is theft,[718] is therefore absurdity taken to its uttermost limit. It would be no more exaggerated to say that theft is property, or that what is legitimate is illegitimate, or that what exists does not, etc.[719] The author of this bizarre aphorism probably wished to catch people’s attention, (people) who are always curious to see how a paradox can be justified, and that basically what he wanted to say was this: Some people get paid for work they have not done, in addition to the work they have, thus appropriating to themselves (alone) the gifts of God, the gratuitous utility or the good (which belongs to) everyone. In this case, the assertion needed to be proved and then the following statement made: theft is theft.

To steal, in common parlance, means to take something of value by force or fraud to the detriment and without the consent of the person who has created it. It can be readily appreciated, then, how a false version of political economy has been able to extend the meaning of this dismal word, (to) steal.

It started by confusing utility with value. Then, since nature co-operates in creating utility, the conclusion was drawn that it contributed to the creation of value, and it was said that since this portion of value was not the result of anyone’s work it belonged to everyone. Finally, it having been noted that value is never handed over without being paid for, it was added that a person is stealing who gets paid for a value created naturally, one independent of any human labor, inherent in things, and thus by providential intent one of their intrinsic qualities, like weight or porosity, form or color.

An accurate analysis of value topples this scaffolding of subtleties from which people wanted to deduce a monstrous conflation of plunder and property.

God has made raw materials and natural forces available to man. To take possession of these material things and forces, you either need to take some trouble or you do not. If no trouble was needed, nobody would freely agree to buy from others, in return for an effort, what he could gather from the hands of nature with no effort. In all this there is no possibility of service, nor of exchange, nor of value, nor property. If trouble is required, in all justice it is incumbent on the person who is to enjoy the satisfaction, from which it follows that the satisfaction has to be for the person who has taken that trouble. This is the principle of (private) property. This having been said, if a man takes (the) trouble on his own behalf, he becomes the owner of all the utility achieved by the contribution made by this trouble and by nature. If he takes this upon himself on someone else’s behalf, he will demand in return an equivalent amount of trouble that also serves as a vehicle for (the transfer of this) utility, and the result gives us two instances of trouble taken, two instances of utility which have changed hands, and two instances of satisfaction. However, sight must not be lost of the fact that the transaction is accomplished by comparison, by evaluation, not of the two instances of utility (these cannot be evaluated) but of the two instances of service exchanged. It is therefore accurate to say that, from the personal point of view, through labor man becomes the owner of natural utility[720] (this is all he works for), whatever the relationship (is) between labor and utility, (and this can be) infinitely variable. But from the social point of view, with regard to other people, men are only ever the owners of value, which is not based on the bounty of nature but on human service, the trouble taken, the danger encountered, or the skill used to gather this bounty, in a word, with regard to what relates to natural and gratuitous utility, the latest purchaser, the person who is to receive the satisfaction, is put, by means of exchange, in exactly the same position as the initial worker. As this initial worker found a gratuitous utility that he took the trouble to gather, the latest purchaser pays him back an equivalent level of trouble and takes over all his rights. He acquires the utility by the same right, that is to say, gratuitously, on condition that he returns an equivalent amount of trouble. In this there is neither in fact nor in appearance any wrongful taking of the gifts of God.

Thus I am bold enough to say that the following proposition is unshakeable:

With regard to one another, people are the owners only of values and values represent only services that are compared, freely received, and freely rendered.

I have already demonstrated[721] that this is, from one aspect, the true meaning of the word value; I have shown from another, that people are never and can never be the owners of anything other than value with regard to one another, and this is the result both of reason and experience. Of reason, since why would I buy from a man using some trouble I have taken as (a means of) payment, what I am able to obtain from nature either for less trouble or none at all? Of universal experience, (which is) not an inconsiderable weight in this matter, since nothing is more likely to give confidence to a theory than the reasoned and practical agreement of men at all times and in all countries. Well, I state that universal agreement ratifies the meaning I am giving here to the word property. When a public official carries out an inventory after (someone’s) death or when instructed to by the courts, when traders, manufacturers, and farmers carry out the same operation on their own initiative, or when this operation is entrusted to officials dealing with bankruptcy, what is recorded on the official documents for each object examined? Is it its utility or intrinsic worth? No, it is its value, that is to say, the equivalent amount of trouble that any purchaser, selected at random, would have to make to get a similar object for himself.[722] Do the experts concern themselves with finding out if one thing is more useful than another? Do they take the point of view of the satisfaction that things can provide? Do they rate a hammer more highly than a piece of art in the Chinese style because the hammer turns the law of gravity admirably to the benefit of its owner? Or perhaps a glass of water more than a diamond, because in absolute terms the water provides more genuine service? Or a book by (Jean-Baptiste) Say more than one by (Charles) Fourier because more serious benefits and solid instruction may be drawn from Say’s? No, note this clearly, they evaluate and establish the value by strictly adhering to my definition. To put it better, it is my definition that conforms to their practice. They take account, not of the natural advantages or gratuitous utility attached to each object, but of the service that any purchaser would have to render himself or claim from another in order to acquire it. They do not evaluate - may I be forgiven for this daring expression? - the trouble God has taken, but the trouble that the buyer would have to take. And when the operation has ended, when the public has established the total value recorded on the balance sheet, the unanimous statement is made: This is what the beneficiary is the OWNER of.

Since items of property only include values, and since values express only relationships, it follows that items of property themselves are only relationships.

When the public on seeing two inventories states: “This man is wealthier than this other man,” they do not mean by this that the relationship between two pieces of property expresses that between two absolute levels of wealth or well-being. There exists in people’s satisfactions, in their absolute well-being, a part of common utility which changes this relationship considerably. Everyone, indeed, is equal when it comes to the light of day, the air we breathe, and the warmth of the sun. Inequality, expressed by the difference in the amount of property or values, ought ought only apply to onerous utility.

Well, I have often said and will doubtless repeat many times more, for it is the greatest, finest, and perhaps the least known of the social harmonies and one that sums up all the others: it is in the nature of progress - and progress consists only in this - to transform onerous utility into gratuitous utility, to decrease value without decreasing utility, to ensure that, in order to acquire the same things, each person would have to take less trouble (themselves) or less to reimburse (someone else); to increase constantly the pool of things held in common,[723] the enjoyment of which, spread uniformly among everyone, gradually eliminates the inequality resulting from the difference in the amount of property owned.

Let us not tire of analyzing the result of this mechanism.

[gap]

How many times, when contemplating the phenomena of the social world, have I not had the occasion to realize the profound justice of this statement by Rousseau: “You need a great deal of philosophy to observe what you see every day!”[724] This is how habit, this veil drawn over the eyes of the common people and from which the attentive observer is not always capable of freeing himself, prevents us from discerning the most marvelous of economic phenomena: the real wealth that is constantly moving from the domain of (private) property to the domain of the Commons.

Nevertheless, let us try to note this democratic evolution and even, if it can be done, measure its effect.

I have said elsewhere that if we wished to compare two periods of time from the point of view of genuine well-being, we would have to base everything on unskilled labour (as) measured by time and ask ourselves the question: What is the difference in the amount of satisfaction obtained in a given period of unskilled labour, for example, the day’s work of a simple laborer, depending on the degree of the advancement of society?

This question implies two others:

At the time evolution began, what was the ratio of satisfaction to the simplest form of work?

What is this ratio today?

The difference will measure the increase in gratuitous utility in relation to onerous utility, (and thus the increase) of the common domain relative to the appropriated domain.[725]

I do not believe that there is a problem more interesting and instructive for a person interested in political matters; to consider. May the reader forgive me for burdening him with too many examples to help us reach a satisfactory solution.

When I began,[726] I made a sort of list of the most general human needs: breathing, food, clothing, housing, transport, education, entertainment, etc.

Let us return to this list and see what satisfactions a simple laborer could get for himself originally and is able to get today for a given number of days’ work.

Breathing: Here gratuitousness and common availability have been total from the outset. As nature has been responsible for the entire process, it has left us with nothing to do. No efforts, services, value, ownership, or progress are possible. From the point of view of utility, Diogenes was as wealthy as Alexander; from the point of view of value, Alexander was as wealthy as Diogenes.[727]

Food: In the current state of affairs, the value of a hectoliter of wheat in France is equivalent to fifteen to twenty days of the most unskilled work. This is a fact and fail to recognize it as much as we like, it remains no less worthy of note. It is clear that today, considering the human race from its least advanced aspect, as represented by a day’s work by a proletarian day labourer, we can see that it (the human race) obtains the satisfaction attached to a hectoliter of wheat with fifteen days of the most unskilled labour. It has been calculated that three hectoliters of wheat are needed to feed one man. Thus, a simple laborer produces, if not his (own) food, at least (and this means the same thing to him) the value of his food by using up between forty-five and sixty days of his annual number of work days. If we represent by 1 (which for us is one day of unskilled labour) our measure of value, the value of one hectoliter of wheat will be expressed by 15, 18 or 20, depending on how productive the year is. The ratio of these two values is one to fifteen.

In order to ascertain whether progress has been achieved and to measure it, the question has to be asked what this ratio was at the dawn of the human race. Truly, I do not dare to put forward a(n exact) figure, but there is a way of elucidating this unknown (factor) “x." When you hear someone speaking out against the social order, against the appropriation of land, against rent, or against mechanization, take him to the center of a virgin forest or to the edge of a foul marsh. Tell him: “I want to emancipate you from the yoke of which you are complaining. I want to take you away from the frightful struggles of anarchic competition, conflicts of interest, the selfishness of the wealthy, the oppression of property, the crushing competition caused by mechanization, and the stifling atmosphere of society. Here is land similar to the land the first clearers encountered. Take as much of it as you like, tens or hundreds of hectares! Cultivate it yourself. Everything you make it produce will be yours. I set just one condition: you must have no recourse to the society of which you claim to be a victim.

Note this clearly; this man will be faced with earth in the same condition as that encountered by the human race itself at the outset. Well, I do not think I will be contradicted if I say that it will not produce one hectoliter of wheat every two years. This is a ratio of 15 to 600.

And here we have measured progress. With regard to wheat and in spite of the obligation to pay ground rent, interest on capital, and rent for the tools, or rather because he pays these costs, a day labourer obtains with fifteen days’ work what he would have had trouble producing with six hundred. The value of wheat, measured by the most unskilled work has thus fallen from 600 to 15 or from 40 to 1. One hectoliter of wheat has exactly the same utility to man as it would have had on the day after the flood. It contains the same amount of food, satisfies the same need, and to the same extent. It constitutes the same genuine wealth but is no longer the same relative wealth.[728] Nature has to a major extent been responsible for its production, which has been achieved with less human effort. Men have provided a lesser service to each other by passing it from hand to hand; it has less value. And, to sum it up, it has become gratuitous, not absolutely but in the proportion of forty to one.

And not only has it become gratuitous but also common to all in the same proportion. For it is not for the benefit of the person who has produced it that the 39/40ths of effort have been eliminated, but for the benefit of the one who consumes it, whatever the type of work he undertakes.

Clothing. The same is also true. A simple laborer goes into a shop in the Marais[729] and receives a garment that corresponds to twenty days of his work, which we assume to be of the lowest quality. If he had to make this garment himself, he would not succeed in (doing) this during his lifetime. If he wished to procure a similar garment at the time of Henry IV,[730] it would have cost him three or four hundred days’ work. Where has the difference in value of the fabrics with regard to the length of unskilled work come from, then? It has been eliminated because the gratuitous forces of nature have been responsible for the work, and it has been eliminated for the benefit of the entire human race.

For we must not stop noting the following: Each person owes his fellow man a service equivalent to the one he receives. Therefore, if the technology of the weaver had made no progress, if the weaving had not been carried out in part by forces that were gratuitous, the weaver would take two or three hundred days to make the fabric and our laborer would have to hand over two or three hundred days of work to obtain it. And since the weaver, despite his good will, is unable to succeed in having himself paid for two or three hundred days or be remunerated for the intervention of the gratuitous forces (of nature) for the progress he achieves, it is perfectly accurate to say that this progress has been accomplished for the benefit of the purchaser, the consumer, universal satisfaction, and the entire human race.

Transport. Prior to all progress, when, like the day laborer we have portrayed, the human race was reduced to unskilled and primitive labour, if someone wanted a load weighing a hundredweight to be transported from Paris to Bayonne,[731] he would have had the following alternative: either to lift the load on to his shoulders and carry out the task himself, traveling over mountains and through valleys, which would have required at least one year of labor, or to ask someone else to carry out this hard task on his behalf. And, since in this situation the new carrier would have used the same means and taken the same time, he would have demanded as payment one year of work. At this period, therefore, if the value of unskilled labour was one, the value of transport was 300 for a weight of one hundredweight and a distance of 200 leagues.

Things have changed a great deal. Indeed, there is no laborer in Paris who cannot achieve the same result for the sacrifice of two days’ work. The alternative is still the same. You still have to carry out the transport yourself or have it done by someone else by paying him. If our day laborer carried it out himself, he would still require one year of hard labor, but if he turned to people in the shipping trade, he would find twenty entrepreneurs who would take it in hand for 3 or 4 francs, that is to say, for the equivalent of two days of unskilled labour.[732] Thus, since the value of unskilled labour is one, that of transport, which used to be 300, is now no more than two.

How has this astonishing revolution come about? Oh, it has taken quite a few centuries. People have trained certain animals, tunneled through mountains, filled in valleys, built bridges over rivers, invented sleds first of all and then wheels, reduced the number of obstacles which had required labour, services, and value (to be overcome). In short, they succeeded in doing, with the trouble to be taken amounting to two, what could be done at the outset only with trouble amounting to three hundred. This progress has been accomplished by people who thought only of their own interests. Yet who benefits today? Our poor day laborer does and everyone else with him.

Let it not be said that this is not (an example of) community. I state that it is (a) community in the strictest sense of the word. At the outset, the satisfaction involved called for the equivalent of 300 days’ unskilled labour for everyone, or a lesser number, but in proportion, of days of skilled labour. Now, 298 shares of this effort out of 300 have been taken in hand by nature and the human race has been spared this. Obviously, everyone is equal in the face of these obstacles that have been destroyed, the distance removed, the fatigue eliminated, and the costs destroyed, since all receive the result without having to pay for it. What they do pay for is the human effort that still remains to be made, measured by two, which is the equivalent of two days of unskilled labour. In other words, the person who has not progressed and who can offer only muscular strength has still to hand over two days’ of work to obtain satisfaction. All other men obtain this for a shorter period of effort: lawyers in Paris who earn 30,000 francs a year, with one twenty-fifth of a day, etc., from which it can be seen that people are equal as regards value (which has been) eliminated and that inequality is restricted within the limits which still define the domain of the value which remains, that is (the domain) of private property.[733]

It is misleading for science to proceed by way of examples. The reader is led to believe that the phenomenon whose scientific description is sought, is true just for the individual cases cited to support the argument. However, it is clear that what has been said with regard to wheat, clothing, and transport is true for everything. When the author generalizes it is up to the reader to think of individual examples, and when the former has concentrated on a cold and unforgiving analysis it is the least the latter can do to give himself the pleasure of (making a) synthesis.

After all, we can formulate this law of synthesis as follows:

Value is social property[734] which arises from effort and (overcoming) obstacles.

As obstacles are reduced, effort, value, or the domain of (private) property is reduced along with it.

For each given satisfaction, (private) property constantly retreats and what is common to all constantly advances.

Should we conclude from this, as Mr. Proudhon does, that (private) property is destined to perish? From the fact that with each useful effect realized, and each satisfaction obtained, property loses ground to community, does it follow that it will be absorbed and eliminated by the community?

To reach this conclusion is to fail totally to appreciate the very nature of man. We are encountering here a sophism similar to the one we have already refuted with regard to interest on capital.[735] Interest (rates) tend to decrease, it was said, and therefore it is destined to disappear. Value and property are decreasing, it is being said today, therefore they are destined to be eliminated.

The entire sophism consists in the omission of the following words: for any given outcome. Yes, it is very true that people get any given results with less effort; it is this that what makes them progressive and perfectible. This is why it can be stated that the relative domain of property is growing smaller when it is examined from the point of view of a given satisfaction.

But it is not true that we could ever come to the end of all the results it is possible to obtain. Therefore it is absurd to think that it is in the nature of progress to change the absolute domain of property.[736]

We have said it several times and in all sorts of ways: each effort may in time prove to be the vehicle of a greater sum of gratuitous utility. This fact does not justify the conclusion that people will ever stop making (any) effort. All that can be deduced is that their powers, as they become available, will tackle other obstacles, thus achieving, for the same amount of labour, satisfactions hitherto unknown.

I will emphasize this idea further. Nowadays, nothing must be left open to improper interpretation once we have dared to utter the terrible words, Property and Community.

At (any) given moment in his existence, a man (living) in isolation has only a certain amount of effort available to him. This is also true of society.

When a man (living) in isolation makes progress by harnessing a force of nature to contribute to his labor, the sum of his effort is reduced proportionately to the useful result sought. It would also be reduced absolutely if this man, satisfied with his initial condition, converted his progress into leisure, and refrained from devoting this quantity of effort now released to the pursuit of new satisfactions. But this assumes that ambition, desire, and aspiration are limited forces, that the human heart does not expand indefinitely. Well, this is not so. Scarcely had Robinson Crusoe[737] made nature take over part of his labor than he devoted this portion to new enterprises. The total of his efforts remained the same, but one of these was more productive, more fruitful, and assisted by a greater proportion of gratuitous and natural assistance. This is exactly the phenomenon that is achieved within society.

From the fact that plows, harrows, hammers, saws, oxen and horses, sails, waterfalls, and steam have in succession spared the human race a huge quantity of effort for each result obtained, it does not necessarily follow that the efforts released have been rendered inert. Let us remember what has been said about the indefinite expandability of needs and desires.[738] For that matter, if we took a look at the world, we would not hesitate to acknowledge that each time man has been able to overcome an obstacle using the forces of nature he has turned his own forces to tackle further obstacles. We print more easily, but we print more. Each book requires less human effort and has less value and less of the character of property, but there are more books and, in all, as much effort and value and as much property. I might say as much too with regard to clothing, houses, railways, or all forms of human production. It is not the total quantity of values that has decreased but the total (amount of) utility that has increased. It is not the absolute domain of property that has shrunk, it is the absolute domain of the Commons that has expanded.[739] Progress has not paralyzed labor, it has extended well-being.

Gratuitousness and common availability are the domain of the forces of nature and this domain is constantly expanding. This is a truth that is ascertained both by reason and by fact.

Value and (private) property are the domain of human efforts and reciprocal services, and this domain is constantly shrinking for each given result but not for results taken as a whole; for each given satisfaction but not for satisfactions taken as a whole, because potential satisfactions present a limitless horizon to the human race.

As true as it is that relative property gives way in stages to what is common to all, it is no less false to say that absolute property tends to disappear from the face of this world. It is a pioneer that accomplishes its work in one sphere and moves on to the next. In order for it to vanish, there would have to be no obstacle at all to labor, all human effort would have to become pointless, men would have to have no opportunity to trade or provide services to each other, all production would have to be spontaneous, and satisfaction follow desire instantaneously. We would all have to be equal to (the) gods. At that point, it is true, everything would be gratuitous and common to all; whether it be effort, service, value, or property, nothing that confirms our native weakness would have any reason to exist.

But however hard man strives to raise his position, he remains just as far from omnipotence. How many degrees does he ascend on the scale of the infinite? What characterizes the Divinity, as far as we are given to understand, is that between His will and the accomplishment of His will there is no obstacle: Fiat lux et lux facta est.[740] It was only his powerlessness to express what is foreign to human nature that forced Moses to assume there was an obstacle, a word that needed to be pronounced between the Divine will and the existence of light. But whatever the progress ensured by its perfectible nature to the human race, it can be stated that it will never go so far as to eliminate all obstacles on the road to infinite well-being and thus render the work of his hands and his mind alike superfluous. The reason for this is simple: as certain obstacles are overcome, desire expands and encounters new obstacles that new efforts have to face. We will thus always have work to accomplish, (things to) exchange, and evaluate. Property will thus exist to the end of time, the total mass of which constantly increases as men become more active and numerous, while each effort, each service, each value, and each relative property which passes from hand to hand serves as the vehicle for an increasing proportion of utility which is gratuitous and common to all.

[gap]

The reader will see that we are giving the word property a very wide meaning, and that it is no less accurate for all that. Property is the right to use one’s own efforts for oneself, or to give them away to someone else only on condition of receiving some equivalent effort in return.[741] The distinction between property owners and the proletariat is therefore completely wrong, unless you claim that there is a class of people who do not undertake any work, or who have no right over their own efforts, the services they provide, or those they receive in exchange.

It is a mistake to keep the name of property for one of its specific forms, for capital, land, and what produces interest or rent, and it is on the basis of this false definition that people are then divided into two antagonistic classes. Analysis shows interest and rent to be the fruit of services rendered, with the same origin, the same nature, and the same rights as manual labour.

The world is a huge workshop[742] in which Providence has liberally provided (raw) materials and powerful forces, and it is to these (raw) materials and forces that human work is applied. Previous efforts, current efforts, and even efforts and promises of future efforts are exchanged for each other. Their relative worth, arrived at by exchange and independent of gratuitous (raw) materials and forces, reveals their value, and each person is the owner of the value which he has produced.

The following objection will be raised: what does it matter if someone is, as you say, the owner merely of the value or the acknowledged worth of his service? Ownership of the value carries with it the utility attached to it. Jean has two sacks of wheat and Pierre only one. Jean, you say, is twice as wealthy in value terms. Good heavens, he is also twice as wealthy in utility and even in utility in kind! He can eat twice as much.

Doubtless, but has he not carried out twice as much work?

Let us go, even so, to the heart of the objection.

Essential and absolute wealth, as we have already said, lies in utility. This is what the word itself expresses. Only utility serves a purpose (The Latin word Uti means to serve). It alone relates to our needs and it alone is in man’s sights when he works. At least that is what he pursues in the end since things do not (relieve) our hunger or slake our thirst because they carry value but utility.

Nevertheless, we have to realize what phenomenon society produces in this respect.

(Living) in isolation, man aspires to achieving utility without taking any notice of value, the very notion of which could not exist for him.

In a social state, on the other hand, man aspires to achieving value without worrying about utility. The thing he produces is not intended for his own needs. This being so, it matters little to him whether it is more or less useful. It is up to the person who wants it to assess it from this point of view.[743] As for him, what matters is that, in the market, as much value as possible is placed on it, leaving him sure that he can withdraw from that market, when he chooses, extra utility in line with the extra value he has brought to the product.

The division of labor has led to the state of affairs in which each person produces what he will not consume and consumes what he has not produced. As producers, we pursue value, as consumers, utility. This is borne out by universal experience. The person who polishes a diamond, embroiders lace, distills spirits, or cultivates poppies, does not ask himself whether the consumption of these things is properly or improperly understood. He works and, provided that his work produces value, that is enough for him.

And, let us say in passing, this proves that what is moral or immoral is not work but desire[744] and that the human race advances, not by making producers more moral but by making consumers so. How much have we criticized the English because they harvested opium in India with the deliberate and official idea, it was said, of poisoning the Chinese! This was to misunderstand and displace the principle of morality. We will never prevent the production of something that has value because it is sought after. It is up to the person who aspires to enjoy some form of satisfaction to estimate its effects, and in vain will we endeavor to separate foresight from responsibility. Our wine growers produce wine and will produce it as long as it has value, without taking the trouble to ascertain if, with this wine, people become drunk in France, or kill themselves in America.[745] It is the judgement people make of their (own) needs and satisfactions that governs the direction of production.[746] This is true even of men (living) in isolation, and if stupid vanity spoke louder than hunger to Robinson Crusoe,[747] instead of spending his time hunting he would have devoted it to arranging the feathers of his headdress. In the same way, a responsible nation produces responsible industries while a foolish nation produces industries that are foolish.[748]

But let us return to our subject. I state that:

The person who works for himself has utility in mind.

The man who works for others has value in mind.

Now, property, as I have defined it, is based on value and since value is merely a relationship, it follows that property itself is merely a relationship.[749]

If there were just one man on earth, the idea of property would never occur to him. In a position to take for himself all the useful things surrounding him and never encountering a similar right that would limit his, how would the thought enter his mind to say: This is mine? This concept would assume the correlative: This is not mine or this belongs to someone else. Yours and Mine cannot be conceived of in isolation and it is essential for the word property to imply a relationship, for it stresses that something is owned by one person only by making it understood that this thing is not owned by anyone else.

The first person, says Rousseau, who having fenced a piece of land, thought of saying: “This is mine” was the true founder of civil society.[750]

What does this fencing mean if not the concept of exclusion and consequently of (a) relationship? If its only object was to protect the field from animals, it was a precaution, not a sign of ownership. A boundary post, on the other hand, is a sign of ownership, not a precaution.

In this way, people are truly property owners only in relation to each other, and this being said, of what are they the owners? Of things having value, as can be discerned clearly through the exchanges they make with each other.

Let us take a very simple example, as we have the habit of doing:

Perhaps for all eternity, nature has been working to put into spring water the qualities that make it fit to quench (one’s) thirst and that constitute its utility to us. It is certainly not my work, for it has been carried out without my participation or knowledge. From this point of view, I can very well say that water is a free gift of God to me. What is my own work is the effort I have made so that I can find my day’s supplies.

Of what has this act made me the owner?

In relation to me, I am, if it can be put this way, the owner of all the utility that nature has put into this water. I am able to turn it to my advantage as I think fit. It is indeed for this reason alone that I have taken the trouble to go to collect it. To dispute my right would be to say that although people cannot live without drinking, they have no right to drink the water they have procured through their own labor. I do not think that even communists, although they go very far, would go that far, and even under the Cabet regime,[751] when Icarian lambs were thirsty they would be allowed to go to quench their thirst at the pure water of a spring.

In relation to other people who are deemed to be free to act as I do, I am the owner and can be the owner only of what is called by metonymy the value of (the) water, that is to say, the value of the service I provide by supplying it.[752]

Since I am acknowledged to have the right to drink this water, it would be impossible to dispute my right to supply it. And since the other party to the contract is acknowledged to have the right to go to get it at the spring as I do, it is impossible to contest his right to accept my water. If one person has the right right to offer and another has the right to accept, for payment that has been freely negotiated, the first is thus the owner with regard to the second. Truly, it is a sad thing to write at a time when you cannot take a step in political economy without having to stop to answer such childish objections to such puerile arguments.

But on what basis will the arrangement be made? This is above all what has to be ascertained if we want to appreciate the social importance of this word property, which sounds so discordant in the ears of democratic sentimentality.

It is clear that, both being free, we will take into consideration the trouble I have taken and that he has been spared, as well as all the circumstances that constitute (its) value. We will discuss our conditions and, if the bargain is struck, there is neither exaggeration nor subtlety in saying that my neighbor will have acquired gratuitously or, if you prefer, as gratuitously as I have, all the natural utility of the water. Do we want proof that human effort and not intrinsic utility determines the conditions, be they more onerous or less, of the transaction? We will agree that this utility remains the same whether the spring is close by or distant. It is the trouble taken or which needs to be made that differs with distance, and since the payment varies in line with this effort it is in the effort, and not in the utility, that the principle of value and relative property lies.

It is thus clear that, in relation to other people, I am not nor can I be the owner of anything other than my efforts and services, which have nothing to do with the mysterious and unknown processes by which nature has imparted utility to the things that provide the opportunity for these services. Even though I would very much like to press my claims much further, my property will in fact always be limited, for if I demand more than the value of my service my neighbor will provide this service for himself. This limit is absolute, insurmountable, and decisive. It explains and fully justifies property, (which is) necessarily limited to the very natural right of asking for one service in return for another. It implies that the enjoyment of natural utilities is appropriated in name and in appearance only; and that the expression “the owner of one hectare of land,” “a hundredweight of iron,” “a hectoliter of wheat,” or “a meter of woolen cloth” is (a) genuine metonymy just as the value of water, iron, etc. is, and that insofar as nature has given these goods to people, they enjoy them gratuitously and in common. In a word, what is common to all can be reconciled harmoniously with property, since the gifts of God remain in the domain of the Commons while human services alone constitute the very legitimate domain of property.

From the fact that I have chosen a very simple example to illustrate the line of demarcation which separates the common domain and the appropriated domain, there is no cause to conclude that this line is blurred and erased in more complex transactions. No, it remains and is always revealed in any transaction freely entered into. Doubtless, the action of going to collect water from the spring is a very simple one, but when examined closely it will be clear that the action of growing wheat is more complicated only because it includes a series of actions that are each as simple and in each of which the contributions made by nature and men are combined, so that the example chosen is typical of any other economic event. Whether it is a question of water, wheat, textiles, books, transport, pictures, dancing, or music, we have acknowledged that certain circumstances may give a great deal of value to certain services, but nobody should get paid for anything other than this, and in particular not for the contribution made by nature, so that one of the contracting parties is able to say to the other: “If you demand more than your service is worth, I will go elsewhere or provide this service for myself.”

It is not enough to justify property; I would like to make it treasured, even by the most dyed-in-the-wool communists. What do I need to do to do this? To describe its democratic, progressive, and egalitarian role. To make it understood that not only does it not monopolize the gifts of God in the hands of a few but that it has the special mission of constantly expanding the sphere of the what is common to all. From this point of view it is much more ingenious than Plato, More,[753] Fénélon,[754] or Mr. Cabet.[755]

Nobody disputes that there are goods whose use people enjoy gratuitously and in common in the utmost equality and that, in the social order, a very real community (of goods)[756] exists underneath (private) property. Besides, you do not have to be either an economist or a socialist to have eyes to see this. All of God’s children are treated the same in certain respects. All are equal as to the gravity that anchors them to the ground, as to the air they breathe, the light of the sun, and the water flowing in the streams. This vast and unmeasurable common fund,[757] which has nothing to do with with value or property, Say calls natural wealth as opposed to social wealth, Proudhon natural goods as opposed to acquired goods, Considerant natural capital as opposed to created capital, Saint-Chamans wealth based on enjoyment as opposed to wealth based on value, while we have called it gratuitous utility as opposed to onerous utility.[758] Whatever you call it, it exists, and this is enough for us to be able to say: “In the midst of men there is a common fund of gratuitous and equal satisfactions.”

And if wealth that is social, acquired, created, of onerous value, in a word, property, is distributed unequally, it cannot be said that this is unjust, since for each person (this wealth) is in proportion to the services from which it is derived and of which it is merely the evaluation. What is more, it is clear that this inequality is reduced by the existence of this common fund by virtue of the following mathematical rule: the relative inequality of two unequal numbers is reduced if to each is added an equal number. Therefore where our inventories record that one man is twice as wealthy as another, this proportion ceases to be accurate if you take into consideration their share in gratuitous utility, and even inequality would gradually disappear if this common pool[759] were itself to be increasing (in size).

The question is, therefore, to ascertain whether this common fund is a fixed quantity that is invariable and granted to people from the outset and once and for all by Providence, on top of which is superimposed a fund of private property,[760] without its being possible for any relationship or any interaction to exist between these two types of phenomena.

Economists have thought that the social order had no influence on this natural and common wealth,[761] and this is why they have excluded it from political economy.

Socialists go further; they believe that the social order tends to move the common fund into the domain of (private) property and that it that it sanctions the usurpation of what belongs to everyone for the profit of a few, and this is why they speak out against (the school of) political economy that fails to recognize this disastrous tendency and against (our present) society which tolerates this.

What am I saying? Socialism is charging political economy with inconsistency, and not without reason, for having declared that there was no relationship between common wealth and (privately) appropriated wealth,[762] it invalidated its own assertion and prepared the ground for the socialist complaint on the day when it confused value with utility and said that the (raw) materials and forces of nature, that is to say the gifts of God, possess intrinsic value, a value that belonged to them, for value always and of necessity implies appropriation On that day, political economy lost the right and the means of justifying property logically.[763]

What I have just said, and what I assert with a conviction that is for me (an) absolute certainty, is this: Yes, the fund of private property constantly interacts with the common fund and from this angle the initial economic statement is wrong. However, the second statement developed and exploited by socialism is more disastrous still, for the interaction in question does not happen, in the sense that it moves the common fund into the fund of private property, but on the contrary that it causes the private domain to move constantly into the common domain.[764] Property, which is just and legitimate in itself because it always corresponds to services, tends to transform onerous utility into gratuitous utility. It is the spur that forces the human mind to drag the latent forces of nature out of their inertia. It struggles, doubtless for its own benefit, to overcome the obstacles that make utility onerous. And when the obstacle is overcome to a certain extent, it so happens that it disappears in the same proportion for the benefit of all. At this point, indefatigable (private) property takes on other obstacles, and this occurs repeatedly and always in this manner, constantly raising the standard of living of the human race, bringing about increasingly more of what is common to all and with it equality into the heart of the great family (which is the human race).

It is in this that the truly marvelous harmony of the natural social order consists. I cannot describe this harmony without combating objections that constantly recur, without repeating myself in (a) tiresome fashion. No matter, I will concentrate on this, and may the reader for his part concentrate a little as well.

You have to take on board the following fundamental notion: When there is no obstacle between desire and satisfaction for anyone (for example, there is none between our eyes and daylight), there is no effort to be made, no service to be provided either to oneself or to others, and no value or property (is) possible. Where an obstacle exists, the following series of events come into play. First of all, we see an effort appear, then the voluntary exchange of efforts or services, then a comparative evaluation of the services or (their) value, and finally the right of each person to enjoy the utility attached to these values or property.

If, in this struggle against obstacles (which are) always equal, the contribution made by nature and labor are (also) always in equal proportion, private property and what is common to all would follow parallel lines without ever altering their proportions.

However, this is not so. The universal aspiration of men in their enterprises is to reduce the ratio of effort to result, and in order to do this (they have) to link their labor to an ever-increasing proportion of natural resources. There is not a farmer on earth nor a manufacturer, a trader, a worker, a ship owner, an artist who is not constantly preoccupied with this. All their capacities are devoted to this, and it is to this end that they invent tools and machines, that they solicit the (help of) the chemical and mechanical forces of the elements, and that they share their labour and unite their efforts. To do more with less, this is the eternal problem that they have set themselves down the ages, everywhere, in all types of situations and in all things. Who would deny that they are driven by self-interest in this? What other stimulus would motivate them so strongly? Since every person on earth bears in the first instance responsibility for his own existence and development,[765] would it be possible for him to carry within himself a permanent driving force other than self-interest? You cry out against this, but wait until the end and you will see that if everyone takes care of himself, God takes care of everyone.

Our constant concern is therefore to decrease effort in proportion to the useful result sought. But once effort is reduced, either through the overcoming of the obstacle, or the invention of machines, the division of labor, the bringing together of productive forces, the use of a natural resource, etc., this reduced effort is less appreciated compared to others. A lesser service is rendered by providing it to others, it has less value, and it is totally accurate to say that property has lost ground. Has the useful effect been lost for all that? No, and this is in line with the hypothesis itself. Where has it gone, then? Into the domain of the Commons. As for the share of human effort that the useful effect no longer absorbs, it is not unproductive for all that; it turns toward other conquests. Enough obstacles exist and will continue to exist in the face of the indefinite expandability of our physical, intellectual and moral needs, so that labor, finding itself free on one side, finds enough to do on the other. And this is how, while the fund of private property remains the same, the common fund expands,[766] like a circle whose radius grows ever larger.

Without this, how could we explain progress or civilization, however imperfect it may be? Let us take a look at ourselves and consider our weakness. Let us compare our energy and knowledge with the energy and knowledge presupposed by the countless forms of satisfaction which we are allowed to withdraw from the social bank.[767] Indeed, we will remain convinced that, if left to our own devices, we would not achieve a hundred thousandth part of these satisfactions, even if each of us had access to millions of hectares of uncultivated land. It is therefore certain that a given quantity of human effort achieves immensely greater results now than at the time of the Druids.[768] If this were true only for one individual, the natural inference would be that he lives and prospers at the expense of others. But since the phenomenon occurs in all the members of the human family, the reassuring conclusion must be reached that something outside ourselves has come to our assistance, that the gratuitous cooperation of nature has progressively been added to our own efforts and that it remains gratuitous in all of our transactions, for if it were not gratuitous it would explain nothing.

From the preceding passage, we must deduce the following propositions:

All property is a value and all value is a property.

What has no value is gratuitous and what is gratuitous is common to all.

To lower the value (of something) is to approach (a condition of) gratuitousness.

Approaching (a condition of) gratuitousness is the partial realisation of common availability.

There are times when you cannot utter certain words without laying yourself open to being misinterpreted. There will be no lack of people to exclaim, either in praise or in criticism depending on their camp: “The author is talking about community, therefore he must be a communist.” I expect this and am resigned to it. But while accepting the (poisoned) chalice in advance, I must nevertheless endeavor to try to keep it at arms length.

The reader will have had to be very inattentive (and that is why the the class of readers to be feared the most is the one that does not read) if he has failed to see the abyss that separates community and communism. Between these two concepts there is the distance not only of property but also of law, freedom, justice, and even of human individuality.

Community includes the things we enjoy in common through the will of providence, because since we have had to make no effort to put them to use they cannot give rise to any service, any transaction, or any property. Property is based on the right we have to provide services to ourselves or to others for a fee in return.

What communists want to make common to all is not the free gifts of God but human effort and service.

They want each person to add to the common pool[769] the fruits of his labour and they then make the government authority responsible for sharing this pool equitably.

Well, there are two possible results: either the sharing will be carried out in proportion to what was contributed or it will be made on a different basis.

In the first instance, the result that communism aspires to achieve is the order that currently exists, limiting itself to substituting the arbitrary will of a single person for the freedom of all.[770]

In the second instance, what will the basis for sharing be? The answer of communism is: “equality." Goodness me! Equality with no regard to the difference in the amount of trouble (people have) taken! People would receive an equal share, whether they had worked six hours or twelve, whether the work was done mechanically (without thinking) or required skill! This is the most shocking of all forms of inequality, and what is more it destroys all human action,[771] all freedom, all dignity, and all wisdom. You claim (you want) to destroy competition, but be careful; all you are doing is transforming it. People now compete to see who works most and best. Under your regime they will compete to see who works least and worst.

Communism misunderstands the very nature of man. Effort is painful in itself. What persuades us to undertake it? It can only be a feeling that is even more painful, a need that has to be satisfied, a form of suffering that has to be kept at bay, or a benefit to be achieved. Our motive is therefore self-interest. When communism is asked what it wishes to substitute for this, its reply is uttered by Mr. Louis Blanc: “A point of honor[772] and by Mr. Cabet: “Fraternity.”[773] Make me therefore experience the feelings of another person, so that I can at least know what direction I have to give my work.

And then (just) what is (this) “point of honor” or “fraternity” that is to be put to work in the entire human race by the encouragement and under the vigilance of Messrs. Louis Blanc and Cabet?

But this is not the place to refute communism.[774] All that I wish to point out is that it is exactly the opposite in all respects of the system I have sought to establish.

We acknowledge that man has the right to serve himself or others in accordance with conditions that are freely negotiated. Communism denies this right, since it centralizes all services in the hands of an arbitrary authority.

Our doctrine is based on property. Communism is based on systematic plunder,[775] since it consists in handing over to one person the labor of another with no compensation. Indeed, if it distributed to each person in accordance with his labor, it would be recognizing property and would no longer be communism.

Our doctrine is based on freedom. To tell the truth, property and freedom are one and the same thing in our view, for what makes one person the owner of his service is his right and ability to dispose of it. Communism crushes freedom, since it allows nobody the free disposal of his labor.

Our doctrine is based on justice, communism on injustice. This follows from the preceding passage.

There is thus just one point of contact between communists and us: a certain similarity in the syllables that make up the words communism and community.

But do not let this similarity lead the reader astray. While communism is the antithesis of property, we see in our theory of community the most explicit confirmation and unanswerable proof of property.

For if the legitimacy of property might have appeared to be doubtful and inexplicable, even to people who were not communists,[776] it is because they thought it concentrated the gifts of God that were originally common to all in the hands of a few to the exclusion of others. We think that we have completely dispelled this doubt by demonstrating that what was common to all by Providential intent remains common to all in all human transactions, since the domain of property can never extend beyond beyond value, (beyond) the right (to property) which has been onerously acquired by services rendered.

And on these terms, who can deny property? Who, without being crazy, could claim that men have no right over their own labor and that they have no right to receive the voluntary services of those to whom they have provided voluntary services?

[gap]

There is another word that I need to explain, for it has been strangely misused lately. It is the word “gratuitousness." Do I need to say that what I call gratuitous is not what costs[777] people nothing because they have taken it from someone else, but what costs nothing to anyone?

When Diogenes warmed himself in the sunshine, it might have been said that he was warming himself gratuitously, for he was receiving from the Divine bounty a satisfaction that required no work either from him or from any of his contemporaries. I add that the heat of the sun’s rays remains gratuitous when landowners use it to ripen their wheat and grapes, with the proviso that when they sell their grapes and wheat, they are paid for their services and not for the services of the sun. This point of view may be wrong (in which case, all that is left to us is to become communists), but in any case this is the meaning that I give to the word “gratuitousness," and which it obviously has.

Since the establishment of the Republic, a great deal has been said about free credit and free education.[778] However, it is clear that a gross sophism is wrapped up in this word. Can the state ensure that education is spread around, like daylight, without any effort by anyone? Can it cover France with institutions and teachers who do not get themselves paid in one way or another? All that the state can do is this: instead of allowing each person to demand and pay for this type of service voluntarily, it can snatch[779] this payment from its citizens through taxes and then distribute to them the education of its choice without demanding a second payment from them. In this case, those who do not learn pay for those who do, those who learn little (pay) for those who learn a great deal, and those who are destined to carry out manual work (pay) for those who will be following professional careers. This is communism applied to (one) sector of human activity. Under this regime, which it is not the place for me to judge here, it might and ought to be said: “Education is common to all” but it would be ridiculous to say: “Education is free.” Free! Yes, for some of the people who receive it, but not for those who pay for it, if not to the teacher, at least to the tax collector.

There is nothing that the state cannot give free of charge under this heading, and if this phrase was not a hoax, it is not only free education that the state should be asked for, but free food, free clothing, and free board and lodging.[780] Be careful. The nation is nearly there, at least there is no lack of people who, in its name, demand free credit, free tools of work, etc. etc. Fooled by a phrase, we have made a step toward communism; what reason do we have not to make a second and then a third, until all freedom, all property, and all justice have passed away? Will it be said that education is so universally necessary that right and principles can be bent in its favor? Goodness me! Is food not even more necessary? Primo vivere, deinde philosophari,[781] the nation will say, and I really do not know what answer they might be given.

Who knows? Those who will attribute communism to me for having noted the providential community of the gifts of God will perhaps then be the same (people) who will violate the right to learn and teach, that is to say the very essence of property. These inconsistencies are more surprising than (they are) rare.

 


 

IX. Property in Land

If the idea that dominates this chapter is true, this is how the human race will have to be represented in its relationship with the outside world.

God created the world. He put on its surface and in the bowels of the earth, a host of things that are useful to man because they are able to satisfy his needs.[782]

In addition, He placed forces within its matter: gravity, elasticity, porosity, compressibility, heat, light, electricity, crystallization, and plant life.

He placed man in the midst of these (raw) materials and (natural) forces. He provided them to him gratuitously.

Men began to act on these (raw) materials and forces, and in doing so they provided services for themselves. They also began to work for one another, and in doing this they provided reciprocal services to each other. These services were compared with each other when they were exchanged and this gave rise to the notion of value, and (then) value (gave rise to the notion) of property.

Each person therefore became a property owner in proportion to the services he provided. However, the forces and (raw) materials given gratuitously by God to man at the outset, remained, are still, and will always be, gratuitous in all human transactions, because in the evaluations that give rise to exchanges, it is the services (provided by humans) and not the gifts of God that are evaluated.[783]

The result is that not a single person among us ever ceases to be the beneficiary of these gifts, as long as transactions remain freely entered into. One single condition has been laid on us, and that is to carry out the work needed to make them available to us, or, if someone (else) takes this trouble on our behalf, to undertake for him an equivalent (amount of) trouble in his respect

If this is true, (the grounds for private) property are certainly unshakeable.

The universal instinct of the human race, more infallible than any individual flights of fancy, was to adhere to this principle without analyzing it, when economic theory came along to examine the basis of property in depth.

Unfortunately, it started with a mistake; it (mis)took utility for value.[784] It attributed an inherent value, independent of any form of human service, alike to raw materials and the forces of nature. Property instantly became as unjustifiable as it was unintelligible.

For utility is a relationship between an object and our very nature. It implies no effort, no transaction, and no comparison. It can be conceived in itself and in relation to man living in isolation. Value, on the other hand, is a relationship between one man and another; in order to exist it has to have two parts, for nothing can be compared in isolation. Value implies that the person who holds it will hand it over only for something of equal value.[785] The theory that confuses these two notions therefore reaches the supposition that a person, when entering into an exchange, gives the value supposedly created by nature for the value really created by humans, or utility that has required no work for utility that has required work, in other words, that someone is able to profit from other people’s work without working himself. At first, economic theory called property, thus understood, a necessary monopoly, and then simply a monopoly, later an illegitimate property, and finally theft.

Property in land suffered the first blow. That was inevitable. It is not that all industries do not make use of the forces of nature in their operation; but these forces are much more obvious to the public eye in the phenomena of plant and animal life, in the production of food, and in what are inaccurately called natural resources, the special output of agriculture.

What is more, if one monopoly ought, more than any other, to outrage the human conscience, it is probably the one that applies to the things most essential to life.

The confusion in question, which already enjoys a false plausibility in economic science, since no economic theorist that I know of has escaped it, is rendered even more specious by the spectacle the world offers (us).

The owners of land were often seen to live without working, and the rather plausible conclusion was drawn that “They must have found the means of being paid for something other than their labor.”[786] What could this other thing be but the fertility, the productivity, and the cooperation of (that) tool), (known as) the soil? It was therefore the rent from land that was castigated, depending on the era, under the name of necessary monopoly, privilege, illegitimate property, and (then) theft.

It has to be said: that theory, in the course of its development, encountered a fact that must have contributed greatly to misleading it. Few lands in Europe have escaped conquest and all the abuses that this has led to. Economic science has confused the manner in which private property in land has been violently acquired with that in which it naturally came about.

However, it should not be thought that the erroneous definition of the word “value” was confined to undermining property in land. Logic is an awesome and indefatigable power, whether it starts from a good or a bad principle! It has been said that, just as the earth brings to bear the contribution of light, heat, electricity, plant life, etc. in the production of value, in the same way, does not capital cause the wind, (the) natural elasticity (of gases), and gravity to contribute to the production of value? Therefore there are people, apart from farmers, who also get paid for the intervention of the natural resources.[787] This payment reaches them through interest on capital just as it does landowners through land rent. (So) let us therefore make war on interest just as we do on rent![788]

Here we have, then, the gradual set of blows suffered by property in the name of a set of principles, according to me wrong and according to economists and egalitarians right, namely: the natural resources possess or create value. For, it should be noted, this is a premise on which all the schools of economic thought agree. Where they differ is solely in the timidity or the boldness of their deductions.

The economists have said: ownership (of the land) is a privilege but one that is necessary and must be maintained.

The socialists have said: ownership (of the land) is a privilege but one that is necessary and must be maintained - by demanding compensation from it, (namely in the form of) the right to a job.[789]

The communists and egalitarians have said: property (in general) is a privilege, which must be destroyed.

As for me, I shout at the top of my voice: PROPERTY IS NOT A PRIVILEGE; Your common premise is wrong, and therefore your three conclusions, although they differ, are wrong. PROPERTY IS NOT A PRIVILEGE, and therefore it is not proper that it be tolerated graciously, nor that it be asked to pay us compensation, nor that it be destroyed.

[gap between sections]

Let us briefly review the opinions stated on this serious subject by the various schools (of thought).

We know that English economists have laid down the following principle, with which they appear to agree unanimously: value arises from labor. It is possible that they all (seem to) agree (on this), but do they all agree (on the same thing?) This is what would have been desirable, and the reader will (have to) judge for himself. He will see whether they are not forever and everywhere confusing (gratuitous) utility, which cannot be paid for and is without value, with onerous utility, which alone is due to labour, and which it alone, according to them, possesses value.

Adam Smith:[790]

Trans. of Bastiat’s quote with his emphasis and the word “nonetheless” added: “In cultivating the earth, nature works hand in hand with man and, although the work of nature does not involve any expenditure, what it produces has nonetheless a VALUE, just as much as that produced by the most expensive workers.”[791]

Original: “In agriculture too nature labours along with man; and though her labour costs no expence, its produce has its value, as well as that of the most expensive workmen.”

So here is nature producing value. The purchaser of wheat has to pay for it, although it has cost nothing to anyone, not even labor. Who therefore would dare to come forward to receive this alleged value? Instead of this word, insert the word utility and all will become clear; property is justified and justice is satisfied.

Trans with Bastiat’s insertion: “Rent may be considered to be the product of this power of nature whose use the landowner lends to the farmer … It (Bastiat’s aside: the rent!) is the product of nature that remains after all that can be considered to be the work of man has been deducted or paid for. It is rarely less than a quarter and often more than a third of the total product. Never could the same quantity of human labor in factories achieve so great an increase. In factory work, nature contributes nothing; it is man who does it all.”

Original: This rent may be considered as the produce of those powers of nature, the use of which the landlord lends to the farmer. It is greater or smaller according to the supposed extent of those powers, or in other words, according to the supposed natural or improved fertility of the land. It is the work of nature which remains after deducting or compensating every thing which can be regarded as the work of man. It is seldom less than a fourth, and frequently more than a third of the whole produce. No equal quantity of productive labour employed in manufactures can ever occasion so great a reproduction. In them nature does nothing; man does all;[792]

Is it possible for so many dangerous errors to be contained in fewer words? Thus one quarter or one third of the value of food is due (exclusively) to the power of nature. And in spite of this, landowners are paid by farmers and the farmers (are paid) by the proletariat for the so-called value that remains after human labor has been paid for. And this is the basis on which you want to establish property? What do you make, incidentally, of the axiom: All value comes from work?

And then there is the statement that nature does nothing in factories! Goodness me! Gravity, the compressibility of gas, and animal strength are of no assistance to manufacturers! These forces act in factories exactly as they do in the field; they produce gratuitously, not value, but utility. If this were not so, the ownership of capital would be no more protected than the ownership of land from communist attacks.

BUCHANAN.[793] This commentator, adopting the theory of the master on rent (theory) (namely, Ricardo) but driven by logic, blames Smith for having considered it to be an advantage:

Trans: “It has not occurred to Smith, when he takes that part of the production of the land representing the profit from the funds of that land (Bastiat’s aside: what an expression!) as properly accruing to society, that Rent is just the effect of scarcity and that what the owner makes in this way is made only at the expense of the consumer. Society earns nothing through the reproduction of profit from land. One class benefits at the expense of the others.”

Original: In dwelling on the reproduction of rent[794] as so great an advantage to society, Dr Smith does not reflect that rent is the effect of high price, and that what the landlord gains in this way he gains at the expence of the community at large. There is no absolute gain to the society by the reproduction of rent; it is only one class profiting at the expence of another class.[795]

Here we see the logical deduction: rent is unjust.

RICARDO:

Translation: “Rent is the portion of the produce from the land that is paid to the landowner for having the right to exploit the productive and imperishable capacities of the soil.”[796]

Original: "Rent is that portion of the produce of the earth which is paid to the landlord for possessing the right to exploit the productive and indestructible powers of the soil.”[797]

And in order for there to be no possibility of a mistake, the author adds:

Trans - this is a highly truncated and edited version of the original text: “Rent is often confused with interest and the profit from capital … It is obvious that part of the rent represents interest on capital that is devoted to improving the land, carrying out the building work necessary, etc., while the rest is paid for the exploitation of the natural and indestructible properties of the soil. For this reason, when I mention rent in future in this article, I will use this word only to represent what the farmer pays the landowner for the right to exploit the primitive and indestructible capacities of the soil.”

original: Rent is often, however, confounded with the interest and profit of capital, and, in popular language. the term is applied to whatever is annually paid by a farmer to his landlord. If, of two adjoining farms of the same extent, and of the same natural fertility, one had all the conveniences of farming buildings, and, besides, were properly drained and manured, and advantageously divided by hedges, fences and walls, while the other had none of these advantages, more remuneration would naturally be paid for the use of one, than for the use of the other; yet in both cases this remuneration would be called rent. But it is evident, that a portion only of the money annually to be paid for the improved farm, would be given for the original and indestructible powers of the soil; the other portion would be paid for the use of the capital which had been employed in ameliorating the quality of the land, and in erecting such buildings as were necessary to secure and preserve the produce. Adam Smith sometimes speaks of rent, in the strict sense to which I am desirous of confining it, but more often in the popular sense, in which the term is usually employed. He tells us, that the demand for timber, and its consequent high price, in the more southern countries of Europe, caused a rent to be paid for forests in Norway, which could before afford no rent. Is it not, however, evident, that the person who paid what he thus calls rent, paid it in consideration of the valuable commodity which was then standing on the land, and that he actually repaid himself with a profit, by the sale of the timber! If, indeed, after the timber was removed, any compensation were paid to the landlord for the use of the land, for the purpose of growing timber or any other produce, with a view to future demand, such compensation might justly be called rent, because it would be paid for the productive powers of the land; but in the case stated by Adam Smith, the compensation was paid for the liberty of removing and selling the timber, and not for the liberty of growing it. He speaks also of the rent of coal mines, and of stone quarries, to which the same observation applies -—that the compensation given for the mine or quarry, is paid for the value of the coal or stone which can be removed from them, and has no connexion with the original and indestructible powers of the land. This is a distinction of great importance, in an enquiry concerning rent and profits; for it is found, that the laws which regulate the progress of rent, are widely different from those which regulate the progress of profits, and seldom operate in the same direction. In all improved countries, that which is annually paid to the landlord, partaking of both characters, rent and profit, is sometimes kept stationary by the effects of opposing causes; at other times advances or recedes, as one or the other of these causes preponderates. In the future pages of this work, then, whenever I speak of the rent of land, I wish to be understood as speaking of that compensation, which is aid to the owner of land for the use of its original and indestructible powers.[798]

McCULLOCH:[799]

Trans (a paraphrase of the original): “What is properly called Rent is the sum paid for the use of the natural forces and power inherent in the soil. It is totally distinct from the sum paid for the buildings, fences, roads and other improvements made to the land. Rent is therefore always a monopoly.”

Orignal:“Rent is properly "that portion of the produce of the earth which is paid by the farmer to the landlord for the use of the natural and inherent powers of the soil.” If buildings have been erected on a farm, or if it has been inclosed, drained, or in any way improved, by an expenditure of capital and labour, the sum which a farmer will pay to the landlord for its use will be. composed, not only of what is properly rent, but also of a remuneration for the use of the capital which has been laid out in its improvement. In common language, these two sums are always confounded together, under the name of rent ; but in an inquiry of this nature, it is necessary to consider them as perfectly distinct. The laws by which rent and profits are regulated being totally different, those which govern the one cannot be ascertained if it be not considered separately from the other.”[800]

SCROPE:[801]

Trans (a paraphrase): “The value of the land and the ability to draw a Rent from it are the result of two circumstances: 1. the appropriation of its natural powers; 2. the work devoted to improving it.”

Original: “Rent, however, it must be recollected, in Great Britain and similarly circumstanced countries, includes, in its ordinary acceptation, many other things besides the monopoly-gain arising in the manner we have described from natural or casual advantages, whether of soil or position. A vast amount of labour and capital has been laid out by its successive owners or occupiers ; much of which remains permanently invested in the soil, adding to its value and productiveness.”[802]

The consequence of this is not long in coming:

Trans (a paraphrase of the original): “From the first point of view, rent is a monopoly. It is a restriction of the enjoyment of the benefit of the gifts that the Creator has made to men in order to satisfy their needs. This restriction is just only insofar as it is necessary for the common good.”

Original: .”. the law which secures a property in land is an artificial restraint on the free enjoyment by every individual of those gifts which the bounty of the Creator has provided for the satisfaction of his wants;—this restraint is just only to such extent as it can be proved necessary for the general welfare …”[803]

How perplexed must honest souls be who refuse to admit that nothing is necessary that is not just!

Finally Scrope ends with these words:

Trans: “When it goes beyond this point, it has to be modified by virtue of the principle on which it is established.”

Original: “… wherever it is found to go beyond that point, its modification is required by the same principle which alone sanctions its establishment.”[804]

It is impossible for the reader not to realize that these authors have led us to a denial of (the right of) property, and have very logically led us there starting from the point that landowners are paid for the gifts of God. Here we see farm rent made out to be an injustice that the law has established under the sway of necessity, one it is able to modify or destroy under the sway of some other form of necessity. The communists have never said anything else.

SENIOR:[805]

Trans (largely paraphrased): “The instruments of production are labor and the natural resources. Once the natural resources have been appropriated, landowners have themselves paid for their use in the form of Rent, which is not the reward for any sacrifice whatsoever and which is received by those who have neither worked nor made any advance payments but who have limited themselves to holding out their hands to receive the offerings of the community.”[806]

Original (the concluding section only): "But a considerable part of the produce of every Country is the recompense of no sacrifice whatever; is received by those who neither labour nor put by, but merely hold out their hands to accept the offerings of the rest of the community.”

After having dealt this hard blow to property, Senior explains that part of rent covers the interest on capital, and then he adds:

Translation: “The surplus is levied by the owner of the natural resources and constitutes his reward, not for having worked or exercised thrift but simply for not having kept to himself the gifts of nature when he was able to keep them to himself, for having allowed them to be accepted.”

Original: The surplus is taken by the proprietor of the natural agent, and is his reward, not for having laboured or abstained, but simply for not having withheld what he was able to withhold; for having permitted the gifts of nature to be accepted.[807]

As we can see, it is the same old theory. It is assumed that owners place themselves between mouths that are hungry and the food that God intended for them on condition that they worked. Landowners who contribute to production are paid for this work, which is just, and get paid a second time for the work of nature, the use of productive forces, and the indestructible powers of the soil, which is unjust.

One is sorry to see this theory, developed by the English economists, Mill,[808] Malthus, etc. accepted also on the continent.

“When one franc’s worth of seed," says SCIALOJA,[809] “produces one hundred francs’ worth of wheat, this increase in value is due, for the most part, to the soil.”[810]

This is confusing utility with value. You might as well say that water, that costs just one sou ten feet from the spring, costs ten sous at one hundred feet, with this increase in value being due in part to the intervention of nature.

FLOREZ ESTRADA:[811] “Rent is the part of an agricultural product that remains after all the costs of production have been covered.”[812]

Therefore the landowner receives something for nothing.

The English economists all begin by laying down the following principle: Value comes from labor. It is therefore only through inconsistency that they then attribute value to the power of the soil.

French economists in general see value in utility but confuse gratuitous utility with onerous utility. Nevertheless they do not deliver any less heavy blows to (the idea of) property.

J. B. SAY:

“The earth is not the only natural resource that is productive, but it is the only one or nearly the only one that man has been able to appropriate. The ability of the waters of the sea and rivers to drive our machines, to feed (us with) fish, and to carry our ships is also a productive power. The wind and even the heat of the sun work for us, but fortunately nobody has been able to say: the wind and the sun belong to me and the service they provide ought to be paid to me.”[813]

Say appears to deplore the idea that someone has been able to say: the land belongs to me and the service which it renders ought to be paid to me. Fortunately, I would say, it is no more in the power of the landowner to be paid for the services of the soil than for the services of the wind and sun.

“The earth is an admirable chemical workshop, in which a host of materials and elements are combined and worked upon, and which then emerge in the form of wheat, fruit, linen, etc. Nature has made a gratuitous gift to man of this huge workshop, divided into a host of compartments that are appropriate to a variety of forms of production. However, a few people out of the mass have taken hold of them and have said: ‘This section belongs to me and so does that. What emerges from them will be my exclusive property.’ And what is surprising is that this usurped privilege, far from having had disastrous effects on the community, has proved of benefit to it.”[814]

Yes, doubtless, this arrangement has been of advantage to the community, but why is this? Because it is neither a privilege nor usurped, because the person who said: “This section belongs to me” has not been able to add: “and what emerges from it will be my exclusive property.” But rather: “what emerges from it will be the exclusive property of anyone who wishes to buy it by simply compensating me for the trouble I will have taken and the trouble I will have saved him. The contribution by nature that is gratuitous for me will also be gratuitous for him.”

We should note carefully that Say distinguishes clearly between the share of property, the share of capital, and the share of labor in the value of wheat. He takes a great deal of trouble, deliberately, to justify the initial portion of the payment that comes to the landowner and which is the reward of no prior or current work. But he does not succeed in this for, like Scrope, he falls back on the last and least satisfactory of the resources of argument, (that is) necessity.

“If it is impossible for production to occur not only without land and without capital but without these means of production constituting property, can it not be said that the owners of this property exercise a productive function, since without this function, production would not take place? This function is by way of a useful fiction, it is true, but one which nevertheless, in the present state of our societies, has required accumulation resulting from production, savings, etc.”[815]

The confusion leaps to the eye. What has required accumulation is the role of the landowner as a capitalist, and that is not contested or even called into question. But what is convenient is the landowner as a landowner, as someone who gets paid for the gifts of God. This is the role that needed to be justified, and in this there is no accumulation nor savings that can be alleged.

“If, therefore, property in land and capital (goods) (Bastiat’s aside: why combine things that are different?) are the fruit of production, I am entitled to represent these forms of property as “machines that work,"[816] (which) are productive, and from which their makers draw a rent, while folding their arms.”[817]

Still the same confusion. The person who makes a machine has a property in a capital (good) from which he draws a legitimate rent, since he is being paid, not for the work done by the machine, but for the work he himself did in building it. However, the earth, property in land, is not the fruit of human production. On what grounds would someone be paid for its contribution? The author has combined two forms of property here, whose nature is very different, in order to persuade intelligent people to acquit one for the same reasons that acquit the other.

BLANQUI.[818]

“Farmers who plow, fertilize, sow, and harvest their field, supply labor, without which nothing could be harvested. But the action of the earth which causes the seed to germinate and that of the sun that brings the plant to maturity are independent of this work and contribute to the formation of values represented by the harvest … Smith and several economists have claimed that human labor was the sole source of value. Indeed no, the industry of farmers is certainly not the sole source of the value of a sack of wheat nor of a bushel of potatoes. Their talent will never go so far as to create the phenomenon of germination any more than the patience of alchemists has discovered the secret of making gold. That is obvious.”[819]

It is not possible to confuse things so utterly, first of all utility and value and then gratuitous utility and onerous utility.

JOSEPH GARNIER.[820]

“Rent paid to landowners is essentially different from the payments made to workers for their work or to entrepreneurs to reward the advance payments made by them, in that these two types of payment are compensation for (the) trouble taken on the one hand and of the deprivation and risk to which these people have been subjected on the other, whereas rent is received by landowners more gratuitously and by sole virtue of a legal convention that acknowledges and maintains the right to private property in land in favor of certain individuals.”[821]

In other words, workers and entrepreneurs are paid, justly, for the services they render; landowners are paid, by law, for services they do not render.

“The boldest innovators do nothing other than propose the replacement of individual property by collective property.. We consider that they are quite right according to human law, but they will be wrong in practice for as long as they are unable to show the advantages of a better economic system …[822]

“But for even longer if to the contention that property is a privilege or a monopoly, they add that it is a monopoly that is useful and natural …

“To sum up, it seems to be accepted in political economy (alas! yes and that is what is wrong) that property does not result from Divine right, right of domain, or any other speculative right, but from its utility. It is just a monopoly that is tolerated in the interests of all, etc.”[823]

This is exactly the conclusion enunciated by Scrope and repeated by Say in less harsh terms.

I think that I have shown sufficient proof that political economy, based on the false premise that “The natural resources have or create value,” had reached the following conclusion: “Property (insofar as it takes control and gets paid for value (which has been) untouched by any form of human service) is a privilege, a monopoly, and usurpation. However, it is a necessary privilege, and one that must be maintained.”

It remains for me to make it clear that socialists start from the same premise; they merely change the conclusion to the following: “Property is a privilege that is necessary. It has to be maintained, but compensation must be required from the landowner in the form of a right to a job for the proletariat.”

I will then summon the communists appear in court. On the same premise, they say “Property is a privilege; it has to be abolished.”

And finally, at the risk of repeating myself, I will end by overturning, if I can, the premise common to these three conclusions: “The natural resources have or create value." If I succeed, if I demonstrate that natural resources, even when appropriated, do not produce value, but utility, which when it passes through the hands of landowners without leaving any trace, reaches consumers gratuitously, [824](then) economists, socialists and communists should all finally agree to leave the world as it is in this respect.

Mr. CONSIDERANT.[825] [826]

“To see how and under what conditions Private Property can appear and can develop legitimately, we have to know the fundamental principle of the right to property. Here it is:

Every man LEGITIMATELY POSSESSES THE THING that his work or mind, or more generally, HIS ACTIVITY HAS CREATED.

This Principle is incontestable, and it is a good thing to note that it implicitly contains an acknowledgement of the right of all to the land. Indeed, since the land was not created by man, it results from the fundamental principle of property that the land, the common resource handed over to the (human) species, can under no circumstances legitimately be the absolute and exclusive property of this or that individual who has not created this value. Let us therefore draw up the true theory of property, exclusively on the indisputable principle that rests its legitimacy on the actual CREATION of the thing or value possessed. To do this, we will think about the emergence of industry, that is to say on the origin and development of farming, manufacturing, the arts, etc. in human society.

Let us suppose that on the land of an isolated island, on the soil of a nation, or on the entire earth (the extent of the theatre of activity changes nothing concerning the appreciation of the facts), a human generation took up production for the first time and for the first time began to farm, make things, etc. Through its labor, intelligence, and through its own activity, each generation creates products and develops things of value that did not exist on the unimproved land. Is it not perfectly obvious that, in this first industrious generation, Property will be in accordance with (what is) Right IF the value or wealth produced by the activity of all is shared among the producers IN PROPORTION TO THE CONTRIBUTION made by each to the creation of general wealth? This is incontrovertible.

Now, the results of the work of this generation are divided into two categories that it is important to distinguish clearly.

The first category includes the products of the soil that belonged to this initial generation as a usufructuary, (which were) increased and refined, or actually made by its labor and industry. These products, whether natural or manufactured, consist either in consumer products or (tools) of labor. It is clear that these products belong as full and legitimate property to those whose activity has created them. Each of these people therefore has the RIGHT either to consume these products immediately, to store them in order to be able to use them later as they wish, or to use them, exchange them, or give and hand them over to anyone they like without needing any authorization from anyone to do this. According to this hypothesis, this property is obviously legitimate, respectable, and sacred. It cannot be infringed without an infringement of justice, right and individual freedom, in short, without (carrying out an act of) plunder.

The second category. However, the things created by the industrious activity of this initial generation are not all included in the previous category. Not only will this generation have created the products we have just enumerated (consumer items and tools of labor) but it has also added Additional value[827] to the original value of the soil, through farming, the buildings constructed, and all the other improvements it has carried out.

This added value obviously constitutes a product or a value due to the activity of the initial generation. Well, if by some means (let us not bother here with the question of the means), if, by some means the ownership of this Added value is fairly distributed to the various members of society, that is to say, in proportion to the contribution of each person in its creation, each of these people will legitimately possess the share due to him. He will therefore be able to dispose of this individual and legitimate property as he thinks fit, whether to exchange it, give it away, or transmit it without any other person, that is to say, society, ever being entitled to any rights or authority over these values.

We can therefore perfectly imagine that, when the second generation comes along, it will find two types of capital in the world:

A. The original or natural capital that has not been created by those of the initial generation, that is to say, the value of the unimproved earth:

B. The capital created by the initial generation that comprises: 1. the products, commodities, and tools that have not been consumed or used by the initial generation; 2. the added value that the work of the initial generation will have added to the value of the unimproved earth.

It is therefore obvious, and is a clear and necessary consequence of the fundamental principle of the right of property as established before, that each individual of the second generation has an equal right to the original or natural capital while having no right to the other form of capital, the capital created by the work of the initial generation. Each individual of the initial generation will thus be able to dispose of his share in the capital created in favor of any particular individuals of the second generation he may choose, whether children, friends, etc. without anyone or even the state itself, as we have just said, being able to claim anything (in the name of the right to property) over the grants that the donor or person making the bequest has made.

Let us note that, according to this hypothesis, individuals of the second generation are already at an advantage compared with those of the initial generation, since in addition to the right to original capital that they retain they have some chance of a share of the capital created, that is to say, a value that they will not have produced and that represents work done previously.

If therefore we assume that the situation in society is as follows:

1. The right to original capital, that is to say the right to the usufruct of the soil in its unimproved state, is retained or an EQUIVALENT RIGHT is acknowledged to each individual that is born on earth at a(ny) given time;

2. created capital is constantly shared among men as it is produced in proportion to the contribution made by each to the production of this capital;

If, as we say, the mechanism of the social organization[828] satisfies these two conditions, PROPERTY in a regime like this would be constituted in ABSOLUTE LEGITIMACY and the reality would be in accordance with (what is) right.”[829]

Here we see a socialist author distinguishing two types of value: created value, which is the object of legitimate ownership, and uncreated value, also called the value of unimproved land, original capital, or natural capital, which can become individual property only by usurpation. Well, according to the theory that I am endeavoring to have accepted, the ideas expressed by the words uncreated, original, and natural, radically exclude the other notions, value and capital. This is why the premise that leads Mr. Considerant to the following sad conclusion is false:

“Under the regime by which property is established in all civilized nations, the common base on which the entire species has full usufructuary rights has been invaded and confiscated by a small number of people to the exclusion of the majority. Well then! Even if there were to be just one person deprived of his right to the usufruct of the common fund, by the nature of the regime of property, this exclusion on its own would constitute an infringement of what is right, and the regime of property that consecrated it would certainly be unjust and illegitimate.”[830]

However, Mr. Considerant does acknowledge that the earth can be tilled only under the regime of private property. This is the monopoly that is necessary. What has to be done, therefore, to reconcile everything and safeguard the rights of the proletariat to the original, natural, and uncreated capital, the value of the unimproved land?

“Well then! Let an industrious society that has taken possession of the earth and which takes away from men the capacity to exercise their four natural rights where they will and in freedom on the surface of the soil, let that society, in compensation for the rights it takes away from these people, recognize their RIGHT TO A JOB.”[831]

If there is one thing that is obvious in this world it is that this theory, except for its conclusion, is exactly the one that economists hold. The person who buys an agricultural product pays for three things: 1. The current work, and there is nothing more legitimate than this; 2. The added value given to the soil by work done previously, and there is nothing more legitimate than this as well; and finally 3. The original or natural or uncreated capital, this free gift of God, called the value of the unimproved land earth by Considerant, the indestructible power of the soil by Smith, the original and indestructible powers of the soil by Ricardo, and the natural resources by Say. THIS is what has been usurped according to Mr. Considerant, This is what has been usurped according to J. B. Say, This is what constitutes illegitimacy and plunder in the eyes of the Socialists, THIS is what constitutes monopoly and privilege in the eyes of the economists. The agreement is pursued still further with regard to the necessity or the utility of this arrangement. Without it, the earth would produce nothing say the disciples of Smith, without it we would return to the savage state, echo the disciples of Fourier.

We see that in theory and law the understanding between the two schools is much more cordial (at least with regard to this major question) than we might have imagined. They go their separate ways only on the consequences to be deduced legislatively from the fact on which they agree. “Since property is branded with illegitimacy, in that it attributes to landowners a share of payment that is not due to them, and since on the other hand it is necessary, let us respect it and ask it for compensation.” “No,” say the economists, “although it is a monopoly, since it is necessary, we should respect it and leave it in peace.” Even this flabby defense is put forward weakly, for one of their latest mouthpieces, J. Garnier adds: “According to human law you are right, but practically speaking, you are wrong as long as you have not shown the effects of a better system.”[832] To which the socialists are not long in replying “We have found one; it is the right to a job, let us try it.”[833]

At this juncture, Mr. Proudhon arrives on the scene. Perhaps you think that this well-known contradictor[834] is going to contradict the great premise of the economists or socialists? Not at all. He does not need to do this to demolish property. On the contrary, he takes hold of this premise; he squeezes it, crushes it, and extracts from it the most logical of consequences. “Ah!," he says, “you admit that the free gifts of God not only have utility but value. You admit that landowners usurp them and sell them. Therefore property is theft.[835] Therefore it should not be maintained or asked for compensation; it should be abolished.”

Mr. Proudhon has built up a great many arguments against private property in land. The most serious of these, the only serious one, is that provided to him by writers who confuse utility with value.

“Who," says he, “has the right to have the use of the soil paid for, this wealth that is not the result of man’s work? To whom is farm rent for the earth due? To the producer of the earth, doubtless. Who made the earth? God. If this is so, landowner, withdraw.[836]

… But the Creator of the earth does not sell it, but gives it away and when giving it away He shows no preference to anyone. How then, among all His children, do some find themselves treated as heirs and others as bastards? How, if the equality of condition was the original rule, has inequality of condition become a posthumous rule?”[837]

In reply to J. B. Say who had likened the earth to a tool (of production), he says:

“I agree that the earth is a tool, but who is the worker? Is it the landowner? Is it the person who, by the simple fact [838] of the right to property gives it power and fertility? This is precisely what constitutes the monopoly of the landowner who, not having made the tool, gets paid for the service. Let the Creator come forward Himself and claim farm rent for the earth, and we will deal with Him, or else let the landowner, claiming to be His agent, show us his power of attorney.”[839]

This is obvious. These three (different) systems make up just one. Economists, socialists and egalitarians, all make one one criticism of private property in land and it is the same criticism, that of getting paid for what it has no right to be paid. This wrong is called a monopoly by some, illegitimacy by others and theft by the third, but this is merely increasing step by step the severity of the same complaint.

Now I call on every attentive reader to say whether this complaint is well founded.[840] Have I not shown that there is just one thing that comes between God’s gifts and hungry mouths, and that this is human service?

Economists, you say “Rent is what is paid to landowners for the use of the soil’s indestructible capacity to produce.” I say “No, rent is what is paid to the water carrier for the trouble he has taken to make a barrow and wheels, and the water would cost us more if he carried it on his back. In the same way, wheat, linen, wool, wood, meat, and fruit would be more expensive for us if landowners had not perfected the tool that produces them.”

Socialists, you say “Originally the masses enjoyed their rights to the earth on condition that they worked; now they are excluded, and their natural inheritance is plundered.” I reply “No, they are neither excluded nor plundered. They receive gratuitously the utility produced by the earth provided that work (is done), that is to say, by recompensing those who saved them from having to undertake this labour.”

Egalitarians, you say “The monopoly of landowners lies in the fact that, while they have not made the tool, they get paid for the service.” I reply “No, the “earth-tool,"[841] insofar as God made it, produces utility and this utility is gratuitous; it is not in the landowners’ power to have others pay them for it. The earth-tool, given that landowners have prepared it, worked it, fenced it, drained it, improved it, and equipped it with other essential tools, produces value representing real human services, and this is the only thing that landowners get paid for. Either you have to acknowledge the legitimacy of this right or you have to reject your own principle: the mutuality of services.”

[section break here]

In order to learn what are the true elements of the value of land, let us go back and examine the formation of private property in land, not according to the laws of violence and conquest but in accordance with those of work and exchange. Let us see how this takes place in the United States.

Brother Jonathan, a hard-working water-carrier in New York,[842] left for the Far West, taking in his wallet one thousand dollars, which were the fruit of his work and savings.

He journeyed through many fertile regions where the soil, the sun, and rain accomplished miracles, and which nevertheless had no value in the economic and practical meaning of the word.

Being something of a philosopher, he said to himself, “Whatever Smith and Ricardo say, value has to be something other than the natural and indestructible productive power of the soil.”

At last he reached the State of Arkansas[843] where he happened to find himself contemplating a fine piece of land of about one hundred acres that the government had marked out for sale at the price of one dollar per acre.

“One dollar per acre!” he said to himself, “that is very little, so little that truly it amounts to almost nothing. I will buy this land, clear it, and sell my harvests, and instead of being a water-carrier (as) I used to be, I too will become a landowner!”[844]

Brother Jonathan was a relentless logician and liked to justify everything to himself. He said to himself “Why though is this land worth even one dollar per acre? Nobody has put a hand to it. It has never been worked. Could Smith and Ricardo and, following them, a line of theorists down to Proudhon, have been right? Has land a value independent of any form of work, service, or any human intervention? Do we have to acknowledge that the soil’s indestructible power to produce is valuable? In this case, why were they not valuable in the regions I traveled through? And what is more, since they so hugely exceed man’s talent, which will never go so far as to (be able to) create the phenomenon of germination, in line with the judicious remark by Mr. Blanqui, why are these marvelous powers worth just one dollar?”

But he soon understood that this value, like all others, is created by man and society. The American government was asking one dollar for the sale of each acre, but on the other hand it promised to guarantee the security of the buyer to a certain extent. It had constructed some sort of road in the vicinity; it made possible the sending of letters, journals etc., etc. “(This is) service for service,” said Jonathan: “the government makes me pay one dollar but it is giving me back the full equivalent. This being so, with apologies to Ricardo, I can explain the value of this land from the human point of view, a value that would be even greater if the road were closer, the mail more accessible, and protection more effective.”

While carrying on this discussion, Jonathan worked, for, to do him credit, he did both of these at the same time.

After having spent his remaining dollars on buildings, fencing, land clearance, leveling, drainage, improvements, etc. and after digging, plowing, harrowing, sowing, and harvesting, came the moment to sell the harvest. “I will know at last” exclaimed Jonathan, still wrestling with the problem of value, “whether by becoming a landowner I have been transformed into a monopolist, a privileged aristocrat, a plunderer of my brethren, or a land grabber[845] of the divine bounty.”

He therefore took his grain to market and fell into conversation with a Yankee. “Friend,” he said to him, “how much will you give me for this corn?”

“The going price,” said the other.

“The going price! But will that give me something more than the interest on my capital and payment for my work?

“I am a merchant,” said the Yankee, “and I have to be content with payment for my current or previous labor.”

“And I was content with it too when I was a water-carrier,” replied Jonathan, “but now I am a landowner. English and French economists have assured me that as such, in addition to the double payment in question, I ought to obtain a windfall from the soil’s indestructible power to produce and to levy a windfall from the gifts of God.”

“The gifts of God belong to everyone,” said the merchant, “I make good use of the wind’s productive power to drive my ships but I do not have people pay for it.”

“And I am determined that you will pay me something for these forces, so that Messrs. Senior, Considerant and Proudhon will not have called me a monopolist and usurper in vain. If I have to suffer the shame of this, at the very least I will have the benefit of it.”

“In this case, farewell, brother. I will go to other landowners to obtain corn, and if I find they have the same point of view as you, I will grow it myself.”

Jonathan then understood this truth, that in a regime of freedom one cannot be a monopolist by (just) wanting to. “As long as there is land to be cleared in the Union,” he said to himself, “I will merely be the person who puts to work these well-known indestructible and productive forces. I will be paid for my trouble and that will be all, just as, when I was a water-carrier, I was paid for my labor and not that of nature. I see clearly that the true beneficiary of the gifts of God is not the person who grows the wheat but the person the wheat feeds.”

A few years later, another enterprise attracted Jonathan, and he set about finding a farmer for his land. The conversation that took place between the two parties to the contract was very curious and would shed great light on the question if I reported it in its entirety.

Here is an excerpt:

Landowner: “What! You want to pay me as farm rent only the interest at the going rate for the capital I have spent?”

Farmer: “Not a penny more.”

Landowner: “Why, if you please?”

Farmer: “Because with an equal amount of capital I am capable of bringing land to exactly the state yours is in.”

Landowner: “That seems to be decisive. But consider that when you are my farmer not only will my capital be working for you but the soil’s indestructible power to produce, as well. You will have the marvelous effects of the sun and the moon, magnetism and electricity, at your service. Should I be handing all this over to you for nothing?”

Farmer: “Why not, since these have cost you nothing, you gain nothing from them and I will gain nothing from them either.”

Landowner: “I gain nothing? Heavens, I gain everything! Without these wonderful phenomena, all the work I put in would not grow one blade of grass.”

Farmer: “Doubtless. But remember the Yankee. He did not want to give you one cent for all the contributions made by nature, any more than when you were a water-carrier the housewives of New York wanted to give you a cent for the admirable process by which nature fed the spring.”

Landowner: “But Ricardo and Proudhon …”

Farmer: “I couldn’t give a fig for Ricardo. Let us deal on the basis I have set out or I will clear the land adjacent to yours. The sun and the moon will help me to do this free of charge.”

It was the same argument all over again and Jonathan began to understand that God with some wisdom had seen to it that it would not be easy to block His gifts.

Somewhat disillusioned with being a landowner, Jonathan wanted to direct his energies elsewhere. He decided to put his land up for sale.

There is no need to say that nobody was willing to give him more than it had cost him himself. It was no use citing Ricardo and claiming that the soil’s indestructible power had an alleged inherent value, he always received the same reply “There is land nearby.” And this sole sentence reduced his demands to nothing, just like his illusions.

During this transaction, something happened that is of great economic importance and not sufficiently noted.

Everyone understands that if a manufacturer wished to sell his equipment after ten or fifteen years, even if it were in mint condition, it is probable that he would be obliged to take a loss. The reason for this is simple: ten or fifteen years scarcely go by without producing some mechanical progress. This is why the person who exhibits an item of equipment that is fifteen years old cannot expect to be repaid fully for all the labor that this item required, since for an equal amount of labor, in view of the progress made, the buyer can get more advanced machines for himself - which, en passant, proves more and more that value is not proportional to labor input but to the services (it provides).

We can conclude from this that it is in the nature of industrial equipment to lose its value through the mere passage of time, independently of any deterioration brought on by use, and we can set out the following formula: “One of the effects of progress is to reduce the value of all existing industrial equipment.

It is clear, indeed that the more rapid progress is the more old equipment finds it difficult to stand up to competition from new equipment.

I will not pause here to highlight the related properties consequent on this law; what I want to point out is that private property in land does not escape them any more than any other form of property.

Brother Jonathan experienced this. For having said to his buyer “What I have spent on this land in permanent improvements represents a thousand days of work. I am determined that you should repay me first of all the equivalent of these thousand days and then something in addition for the inherent value of the soil apart from all human work.”

The buyer replied:

“In the first place, I will give you nothing for the intrinsic value of the soil, which is quite simply the utility that the adjacent land has in as great an amount as yours. Well, I can obtain this natural non-human utility, gratuitously, which proves that it has no value.

In the second place, since your account books show that you have devoted one thousand days to putting your farm land into the state it is in today I will pay you for eight hundred, and my reason for this is that with eight hundred days’ work I can do as much to the adjacent land as you did in one thousand to yours. Please consider that, in fifteen years, the art of drainage, clearance, building, digging wells, constructing stables, and building transport facilities has made progress. Each given result requires less work, and I am not willing to commit myself to giving you ten for something I can obtain for eight, especially as the price of wheat has decreased in proportion to this progress, which benefits neither you nor me, but the entire human race.”

So Jonathan was faced with the alternative of selling his land at a loss or keeping it.

Doubtless the value of land is not affected by one single event. Other circumstances, such as the construction of a canal or the building of a town, may send the value higher. But what I am pointing out here, something which is very general and unavoidable, always and inevitably acts in a way to lower the value (of land).

The conclusion of what has gone before is this: For as long as a country has abundant land to be cleared, whether landowners cultivate their land, farm it out, or sell it, they enjoy no privilege or monopoly, no exceptional advantage, and in particular they can levy no windfall on the gratuitous bounty of nature. How could this be so once we suppose men to be equal? Has anyone with capital and arms willing to work not the right to choose from agriculture, manufacturing, commerce, fishing, shipping, the arts, or the professions? Do not capital and labor turn enthusiastically towards those careers which provide exceptional profits? Do they not desert those that operate at a loss? Is this certain movement of human forces not enough to establish (an) equilibrium in income in the circumstances we are envisaging? In the United States, do we see farmers making their fortune faster than traders, ship-owners, bankers, or doctors, which is what would inexorably happen if, like the others, they first received the price for their labour and then, on top, more than the others, namely, what they lay claim to, the price of the incalculable work of nature?

Oh! Do you want to know how, even in the United States, landowners might create a monopoly for themselves? I will try to explain it.

Let us imagine that Jonathan brings all the landowners of the Union together and tells them:

“I wanted to sell my harvests and could not find anyone to give me a price high enough. I wanted to rent out my land and my terms were rejected. I wanted to sell it and suffered the same disappointment. My requirements were always countered by this phrase: ‘There is land close by.’ This terrible situation means that my services in the community, like all the others, are valued at what they are worth, in spite of the seductive promises of the theorists. I am allowed nothing, absolutely nothing for the soil’s indestructible power to produce, for the natural resources, the sunshine and moonshine, the rain, the wind, the dew and the frost that I was convinced were my property and of which I am basically the owner in name only. Is it not unjust that I am rewarded only for my services, and even then at a rate that the competition is willing to reduce it to? You all suffer the same oppression and are all the victims of anarchic competition. This would not be the case if, as you will easily understand, if we organise (the ownership) of private property in land,[846] if we join forces to ensure that in the future nobody is allowed to clear a single inch of the land in America. In this case, as the population grows, it would put pressure on the pretty well fixed output of food and we would lay the law down with regard to prices and achieve huge wealth. This would be a huge benefit for the other classes since we would now be rich and we would give them work.”

If, following this speech, the landowners combined to gain control of the legislature, and passed an act according to which any new land clearance was forbidden, there is no doubt that they would increase their profits briefly. I emphasize, briefly, for the social laws would lack harmony if the punishment for a crime like this did not arise naturally from the crime itself.[847] Out of respect for scientific rigor, I will not say that the new law would have given value to the power of the soil or the natural resources (if this were so, the law would not hurt anyone), but I will say that the equilibrium between services would be violently destroyed. One class would plunder the others, and a principle of slavery would be introduced into the country.

Let us move to another possibility, which, truth to tell, is the reality for the civilized nations of Europe, a situation in which all land has passed into the domain of private property.

We have to find out if, in this case as well, the mass of consumers, or the community,[848] continue to be the beneficiaries, free of charge, of the productive force of the soil and of the natural resources, and if the holders of the land are the owners of anything other than its value, that is to say, of their faithful services assessed in accordance with the laws of competition, and whether they are not obliged, like everybody else, when they get paid for these services, to supply the gifts of God (gratuitously) into the bargain.

(So now) (we have) the entire state of Arkansas sold off by the government, divided into private holdings, and put into cultivation. When Jonathan puts his wheat up for sale or even his farm, does he boast about the productive power of the soil and want to have it count for something in (determining) its value? As in the previous instance, we can no longer stop him with the overwhelming phrase: “There is uncultivated land surrounding yours.”

This new state of affairs implies that the population has increased. It is divided into two classes: 1. the class that provides farming services to the community; 2. the class that provides it with industrial, intellectual, or other kinds of service.

Well, what I have to say seems to me to be obvious. Since the workers (other than the landowners) who wish to get wheat for themselves are perfectly free to approach Jonathan or his neighbors or the landowners in neighboring States, and are even able to go to clear uncultivated land beyond the Arkansas borders, it is absolutely impossible for Jonathan to impose an unjust law on them. The sole fact that free land exists somewhere is an invincible obstacle to any privileged status, and we find ourselves back with the preceding set of arrangements. Farming services are subject to the law of universal competition, and it is fundamentally impossible to have them accepted at a higher price than they are worth. I add that they are worth no more (ceteris paribus)[849] than services of any other nature. Just as manufacturers, once they have been paid for their time, their care, the trouble, and risk they have taken, their advance payments, and their skill (all things that make up human service and are represented by value), cannot claim anything for the law of gravity and the expandability of the steam that assists them, Jonathan can include in the value of his wheat only the total amount of his personal service, whether present or past, and not the assistance he has obtained from the laws governing plant physiology. The equilibrium between services is not changed as long as these services are exchanged freely for one another at the negotiated price, and the gifts of God transmitted by these services, as it were into the bargain, and given on both sides, remain in the domain of the Commons.

Doubtless it will be said that in fact the value of the soil is increasing constantly. That is true. As the population becomes denser and wealthier and the means of communication easier, landowners draw more advantage from their services. Is this a law peculiar to them, and not the same for all workers? For a given level of work, do not doctors, lawyers, singers, painters, or laborers acquire for themselves greater satisfaction in the nineteenth century than in the fourth, in Paris than in Brittany, or in France than in Morocco? However this increase in satisfaction is not acquired at anyone’s expense. This is what must be understood. Besides, we will go into further detail on this (metonymic) law on the value of the soil in another section of this work[850] when we have reached Ricardo’s theory.

For the moment, it is enough for us to note that in the circumstances we are examining Jonathan cannot oppress the industrial classes, provided that the exchange of services is free and that work can be allocated with no legal impediment, either in Arkansas or elsewhere, among all types of production. This freedom prevents landowners from seizing the gratuitous benefits of nature for their own advantage.

This would not be so if Jonathan and his colleagues seized the right to pass laws and prohibited or hindered the freedom to exchange, or if, for example, they had it decreed that not one grain of wheat from outside could enter into the State of Arkansas. In this case, the value of the services exchanged between landowners and non-landowners would no longer be regulated by justice. The latter would have no means of limiting the demands of the former. A legislative measure like this would be as unjust as the one we referred to just now. The effect would be exactly the same as if Jonathan, having taken a sack of wheat to market and sold it for fifteen francs, drew a pistol from his pocket and, aiming it at his buyer, said to him: “Give me three francs more or I will blow your brains out.”[851]

This act (for it has to be called by its proper name) is called extortion. Whether naked (personal) extortion or legal extortion,[852] its character remains the same. When it is naked, as in the example of the pistol, it violates property. When it is legal, as in the case of the prohibition (of trade), it still violates property, and in addition it denies the very basis of property. As we have seen, people own only things of value, and value lies in the appraisal of two services that are exchanged freely. Nothing more contrary to the very principle of property can be imagined than the one that changes the equivalence of services in the name of the law.

It is perhaps worth noting that laws of this kind are unjust and disastrous whatever the views of the oppressors, and even of the oppressed in this respect. In certain countries the laborers may be seen to be enthusiastically in favor of these restrictions because they make (the) landowners wealthy. They do not see that it is at their expense, and I know from experience[853] that it is not always prudent to tell them so.

It is very strange! People are very willing to listen to sectarians who preach communism, which is slavery, since not to be the owner of one’s (own) services is to be a slave, and to scorn those who everywhere and at all times defend freedom, which is the community of the beneficence of God.[854]

We reach the third hypothetical case,[855] in which the entire cultivable surface of the world has passed into the domain of individual private ownership.[856]

There are still two classes present, the one that owns the land and the one that does not. Won’t the first be in a position to oppress the second, and won’t the second be reduced to providing ever more work for the same quantity of food?

If I answer this objection, it will be, you understand, to uphold the cause of economic science, for we are several centuries distant from the time in which such arrangements will be a reality.

In the long-run, however, everything points to the arrival of a time at which it will no longer be possible to contain the demands of landowners by saying “There is still land to be cleared.”

I ask the reader to note that this hypothesis implies another, which is that at this time the population will have reached the utmost limit that the world is able to sustain.

This is an element of the question that is new and worthy of consideration. It is almost as if I were being asked “What would happen when there is no longer enough air to support lungs that are too numerous?”

Whatever you think about the laws governing population,[857] it is at least certain that it is able to increase and even that it tends to increase, because it does so. The entire economic organization of society appears to be arranged in the light of this trend. It is with this trend that it is in perfect harmony. Landowners still want to be paid for the use of the natural resources that they hold, but they are constantly frustrated in their crazy and unjust demands by the abundance of similar natural resources that they do not own. The bounty of nature, which is relatively unlimited, makes them simple custodians. Now you have driven me to the time in which people have reached the limit of this bounty. Nothing can be expected from that quarter. Inevitably, the trend of the human race to increase will have to be brought to a standstill and the population must cease to grow. No economic regime can free it from this necessity. According to the hypothesis in question, any increase in population will be limited by mortality; no philanthropy, however optimistic, can go so far as to claim that the number of human beings can continue to increase when the growth in food (supplies) has irrevocably reached its limit.

Here then will be a new order, and the laws governing the social world would not be harmonious if they had not provided for (such) a possible state of affairs, even if this is completely different from the one in which we live.

The difficulty put forward is this: Supposing there is a ship in the middle of the ocean that is a month away from land,[858] and in which there is food and drink for just two weeks, what should be done? Obviously, reduce each sailor’s rations. This is not hardness of heart, but prudence and justice.

In the same way, when the population has reached the upper limit of what the world devoted to farming is able to sustain, a law that takes the gentlest and most effective steps to stop its numbers growing would be neither harsh nor unjust. Well, private property in land is what offers a solution once again. It is private property in land that, under the stimulus of self-interest, will cause the earth to produce the greatest possible quantity of food. It is private property in land that, following division through inheritance, will put each family in a position to perceive the danger to its own situation of a rash increase in numbers.[859] It is very obvious that any other regime, communism, for example, would be both less of a spur in favor of (increased) production and less of a brake to the increase in population.

After all, I think that political economy will have completed its task when it has proved that the great and just law of the mutuality of services will work in a harmonious way as long as the human race is not forbidden to make progress. Is it not reassuring to think that until then, so long as the regime of liberty prevails, it is not in the power of one class to oppress another? Is economic science required to solve this other problem: Given the tendency of people to increase in number, what will happen when there is no more space on earth for any new inhabitants? Does God hold in reserve some creative cataclysm or marvelous demonstration of His infinite power for such an occasion? Or else should we believe, in line with Christian dogma, in the end of the world?[860] Obviously, these are no longer economic problems, and there is no science that does not encounter similar difficulties. Physicists are fully aware that any body that moves on the surface of the earth falls and does not rise again. If this is so, the day has to come when mountains will have filled up the valleys, when the mouths of rivers will be at the same level as their sources, when water will no longer flow, etc., etc., and what will happen then? Ought physics to stop observing and admiring the harmony of the world as it is because it is incapable of guessing what other form of harmony God has foreseen for a situation that is doubtless distant, but inevitable? I think that this is just the situation for economists and physicists alike to replace an act of (scientific) curiosity with and act of faith. He who has arranged the world in which we live so marvelously will be fully capable of preparing another form of environment to suit other circumstances.

We estimate the productivity of the soil and human skill by the facts we observe. Is this a rational rule? Even when we do this, we might say to ourselves: “Since it has needed six thousand years[861] for one tenth of the world to achieve a puny form of agriculture, how many hundreds of centuries more will pass before its entire surface is covered in gardens?

What is more, in this estimation, which is already reassuring, we simply assume the (continued) spread of scientific knowledge, or rather the current state of (our) ignorance of agriculture. But, I repeat, is this an acceptable rule? And does analogy not tell us that an impenetrable veil hides the perhaps indefinite power of (this) science from us?[862] Primitive peoples live from hunting and need a square league of territory. How surprised would they be if they were told that a pastoral existence is capable of keeping ten times as many people alive in the same area! Nomadic shepherds in turn would be highly astonished to learn that a three-year crop rotation system would easily keep a population that was ten times greater than that. Tell a farmer set in his ways that similar progress would be the result of crop rotation and he would not believe you.[863] Is crop rotation itself the latest thing for us, the last word for the human race? Let us be reassured as to the fate of humanity; centuries in their thousands stretch out before it, and in any case, without requiring political economy to solve problems that are outside its field, let us place the destiny of future races in the hands of he who called them into life.

[section break here]

Let us summarize the ideas set out in this chapter.

These two phenomena, utility and value, the contribution made by nature and that made by man, and consequently what is common to all and private property, are to be found in agricultural activity just as in any other.

In the production of wheat that satisfies our hunger, something happens that is similar to what we observe in the formation of the water that quenches our thirst. Economists, does not the ocean that inspires poets offer us also a fine subject for meditation? It is this huge reservoir that has to quench the thirst of all human creatures. And how can this be done if these creatures are situated at such a great distance from its water, which, incidentally, is not drinkable? This is where we have to admire nature’s marvelous industry. Here we have the sun heating this heaving mass and evaporating it slowly. Water turns into vapor and, freed from the salt that spoils it, it rises into the upper reaches of the atmosphere. Breezes, criss-crossing in all directions, drive it toward inhabited continents. There it meets the cold that condenses and attaches it in solid form onto mountainsides. Soon afterward, the warmth of spring melts it. Carried by its weight, it is filtered and purified by the layers of schist and gravel, spread wide, and distributed to supply the refreshing springs found all around the world. This is indeed a huge and ingenious industry accomplished by nature for the benefit of the human race. Changes in form and in place, and (in) utility, nothing is overlooked. Where is value to be found, though? It has not yet come into being, and if what may be called the work of God were paid for (and it would be paid for if it had value) who would be able to say what a single drop of water was worth?

However, not all men have a spring of fresh water on their doorstep. To quench their thirst, they have to go to some trouble, make an effort, engage in foresight, and exercise planning and skill. It is this complementary human labor that gives rise to agreements, transactions, and evaluations. It is therefore in this labor that the basis and origin of value is to be found.

Man is ignorant without knowledge. Initially, he is thus reduced to going to look for water and carrying out the additional work that nature has left to him with a maximum possible amount of trouble. It is at this time that water has the greatest value when exchanged. As time goes on, man invents the barrow and the wheel, he tames horses, invents pipes, discovers the law of the siphon, etc., in short, part of his labour is replaced by the gratuitous forces of nature, and to the same extent, the value of water, but not its utility, decreases.

And something happens here that has to be noted and understood if disharmony is not to be seen where harmony exists. It is that the purchaser of water obtains it at better rates, that is to say, he hands over a lesser proportion of his labor to obtain a given quantity each time progress of this type is achieved, even though in this case he has to pay for the tool by which nature is forced to act. In previous times he paid for the labour needed to find water; now he pays both for this labor and that required to manufacture the barrow, the wheel, and the pipe, and in spite of this, taking everything into account, he pays less. From this we can see the sorry and erroneous preoccupation of those who believe that the payment that relates to capital is a charge on consumers. Will they never understand that capital eliminates more labor for each given result than it requires?

All that has been described applies in exactly the same way to the production of wheat. There too, before human industry, there was vast and immeasurable activity by nature, whose secrets are still unknown to the most advanced forms of science. Gases and salts are distributed in soil and in the air. Electricity, the natural relationships between phenomena, the wind, the rain, light, heat, and life, have in turn been involved, often unbeknownst to us, in transporting, transforming, bringing together, dividing, and combining these elements; and yet this marvelous industry, whose activity and utility escape our estimation and even our imagination, still has no value. The latter comes into being with the first intervention by man who, has much as and more additional work to do in this case as in the other.

In order to direct these forces of nature and remove the obstacles that hinder their action, man takes command of the tool that is the soil, and he does this without causing damage to anyone, for this tool has no value. This is not open to discussion, but a matter of fact. Whatever point on the globe you are, show me one piece of land that has not undergone the direct or indirect influence of human action[864] and I will show you a piece of land devoid of value.

Notwithstanding this, in order to produce wheat in conjunction with nature, farmers have to carry out two distinct types of labor. One type relates immediately and directly to the year’s harvest, relates only to this, and has to be paid for by it: this work includes sowing, weeding, harvesting, and threshing. The other includes the buildings, drainage, clearing, fencing etc. and contributes to an indeterminate number of successive harvests; the cost has to be shared over successive years, and this is accomplished accurately through an admirable series of arrangements known as the laws of interest and amortization. The harvests constitute the reward of the farmer if he consumes them himself. If he exchanges them it is for services of a different order, and the evaluation of the services being exchanged constitutes their value.

Now it is easy to understand that this entire category of long-run projects constantly carried out by the farmer on the soil, constitutes value that has not yet received its entire reward, but cannot fail to receive it. He cannot be made to leave and allow someone else to take over his right without being recompensed. The value is incorporated in and merged with the soil, and for this reason it may correctly be said by metonymy that the soil has value. It has value indeed, because nobody can any longer acquire it without handing over the equivalent of this labor in exchange. But what I maintain is that this land, to which the natural power of production had at the outset not given any value, still has no value in this respect. This power of nature, which was free of charge, still is free and always will be. One may well say that “this land has value," but essentially what has value is the human labor that has improved it and the capital that has been spent on it. On this understanding, it is strictly true to say that its owner is in the end just the owner of the value he has created and the services he has rendered, and what property can be more legitimate? This property is not created at anyone’s expense and does not seize or tax any of the gifts of heaven.

That is not all. Far from increasing prices and thus constituting a charge for consumers, the capital which has been advanced (interest on which has to be spread over successive harvests) allows consumers to buy agricultural products on better and better terms as capital grows, that is to say, as the value of the soil increases. I have not the slightest doubt that this assertion will be taken as a paradox laden with exaggerated optimism, so used are we to considering the value of the soil as a calamity if not an injustice. For my part, I make this assertion: it is not enough to say that the value of the soil is not created at the expense of anyone whomsoever, it is not enough to say that it harms nobody, what has to be said is that it benefits everyone. It is not just legitimate; it is beneficial, even to the proletariat.

Here, what we are seeing is in fact a reproduction of the phenomenon we noted just now with regard to water. We said that on the day when water-carriers invented barrows and wheels it was profoundly true that the buyers of water had to pay for two types of labor instead of one: 1. the work carried out to make the wheels and barrows, or rather the interest and amortization of this capital, and 2. the direct work that still remained to (be done by) water-carriers. But what is equally true is that these two kinds of labor combined, did not equal the single category of work to which the human race was subject before this invention. Why? Because part of the work involved was taken up by the gratuitous forces of nature. It is indeed only because of this decrease in human labor that the invention was prompted (in the first place) and adopted.

Exactly the same thing happened with regard to the land and wheat. Each time farmers invested capital in permanent improvements, it is indubitable that successive harvests bore the interest on this capital. But what is equally indubitable is that the other category of labor, the unskilled labor carried out currently, suffers from a lack of utility that is much greater still, so that each harvest is obtained by landowners and consequently purchasers at prices that are less onerous, with the very action of capital consisting precisely in replacing human labour which has to be paid for with the collaboration of nature which is gratuitous.

For example. For the harvest to be successfully brought in, the field has to be drained of excess water. Let us assume that this work is still in the first category (of unskilled labour); let us assume that the farmer goes out every morning with a bucket to remove the stagnant water where it is harmful. It is clear that at the end of one year this action would not have added any value to the soil, but the price of the harvest would be vastly increased. This would be true of the following harvests for as long as this primitive procedure was the state of the science of agriculture. If the landowner dug a ditch, at this moment the soil would acquire value, for this work belongs to the second category. It is one of the tasks which are incorporated in the land and which have to be paid for by the produce of successive years, and nobody can aspire to acquire the land without paying for this work. Nevertheless, is it not true that it tends to decrease the value of the harvests? Is it not true that, although in the first year it required an enormous effort, in the end it saves much more effort than it took? Is it not true that from now on drainage will be accomplished by the free law of hydrostatics more economically than it could by human labor? Is it not true that the purchasers of wheat will benefit from this operation? Is it not true that they should consider themselves fortunate that the soil has acquired this new value? And in general, is it not finally true that the value of the soil reflects the progress achieved, not for the benefit of its owner alone but for the entire human race? How absurd and contrary to its own interest would it be to say: “What is added to the price of wheat as interest and amortization for this ditch, or for the part of the value of the soil it represents is a privilege, a monopoly, and theft!” At this rate, in order to stop being a monopolist and thief, a landowner would merely have to fill in his ditch and take up his labor with the bucket again. Members of the proletariat, would this advance you (any) further?

If we review all the permanent improvements that constitute the value of the soil you would be able to make the same comment for each of them. Having destroyed the ditch, destroy the fencing as well, thus reducing the farmer to mounting guard on his field. Destroy the well, the barn, the track, the plough, the leveling (which has been) carried out, and the artificial fertilizer. Put the stones back into the field, together with the weeds and the roots of trees, and then you will have achieved egalitarian utopia. The soil, and the human race with it, will be returned to its original state, and will no longer have any value. Harvests would no longer have anything to do with. Their price would be free of this damn thing[865] known as interest. Everything, absolutely everything, will be done through present labor visible to the naked eye.[866] Political economy will be very much simpler. France will provide a living for one man per square league; all the others will have died of starvation, but nobody will be able to say: property is a monopoly, illegitimate, a theft.

Let us therefore not be blind to the economic harmonies unfolding before our eyes as we analyze the ideas of exchange, value, capital, interest, property, and community. Oh dear, is is up to me to go over all this (again)?[867] But perhaps we have progressed enough to recognize that the social world, no less than the material one, bears the stamp of a divine hand from which flows wisdom and goodness, and toward which our admiration and gratitude should be focused.

I cannot refrain from returning at this point to one of Mr. Considerant’s thoughts.

Starting from the given that the earth has an inherent value independent of any human work, that it is original and un-created capital, he draws the inference, rightly from his point of view, that the act of appropriation leads to usurpation. This alleged injustice generates vehement tirades from him against the regime of modern forms of society. On the other hand, he agrees that permanent improvements give added value to this original capital, this additional capital being so bound up with the principal that it can no longer be separated from it. What can be done, then? For we are faced with total value made up of two elements one of which, the fruit of labor, constitutes legitimate property and the other, the work of God, is an unjust usurpation.

The difficulty is not insignificant. Mr. Considerant solves it with the right to a job.[868]

“The development of the human race on the earth obviously requires the soil not to be left in an uncultivated and wild state. The destiny of the human race itself is thus in opposition to any duty of the human race to conserve land in its original and rough state.

In the midst of the forests and plains, primitive peoples enjoy four natural rights, the right to hunt, to fish, to gather and to pasture animals. This is the initial form of (their) right.

In all forms of civilized society, the man of the people, the proletarian who has inherited nothing and possesses nothing, is purely and simply deprived of these rights. Therefore, it cannot be said that this original right has changed its form here, since it no longer exists. The form has disappeared, along with its foundation.

Well, under what form might (this) right be reconciled with an industrious society? The answer is simple.

In this primitive state,[869] in order to exercise his right, man was obliged to act. The work of fishing, hunting, gathering, and pasturing are the conditions for the exercise of his right. The original right is thus merely the right to engage in these (forms of) labour.

Well then! Let an industrious society that has taken possession of the land and that has taken away from man the ability to exercise his four natural rights at will and in full liberty on the surface of the land, allow each individual the RIGHT TO A JOB to compensate for the rights it is taking away from him. If this is done, in principle and subject to proper implementation, the individual will no longer have anything to complain about.

The sine qua non for property to be legitimate is therefore that society acknowledges the RIGHT TO A JOB of the proletariat and that it guarantees it at least as much means of subsistance in order to carry out a given activity, as this activity would have provided him in his original state.

I do not want to repeat myself ad nauseam and discuss the fundamental issues of this with Mr. Considerant. If I prove to him that what he calls uncreated capital is not capital at all, that what he calls the added value of the soil is not added value but total value,[870] he ought to acknowledge that his line of argument collapses entirely, and with it all his complaints against the method by which the human race has judged it appropriate to organize itself and to live from Adam onward. However, this debate would lead me to repeating everything I have already said on the essential and ineradicable gratuitousness of natural resources.

I will limit myself to making it apparent that if Mr. Considerant speaks on behalf of the proletariat, he is really so accommodating that they might consider themselves betrayed. Goodness me! Landowners have usurped the land and all the miracles of plant life that occur on it! They have usurped the sunlight, the rain, the dew, oxygen, hydrogen, and nitrogen, at least insofar as they contribute to the growth of agricultural products, and you are asking them to guarantee the proletariat at least as much (of the) means of subsistance in order to carry out a given activity, as this activity would have provided him in the original state of nature!

But do you not see that private property in land has been a million times more generous without waiting for your injunctions? For in the end, to what does your request lead?

In the original state, your four rights, to fishing, hunting, gathering, and pasturing, provided a living, or rather resulted in a state of stagnation with all the horrors of poverty, for approximately one man per square league. The usurpation of land will therefore be legitimate, in your view, if those guilty of it provide a living for one man per square league[871] and in addition require from him as much activity as a Huron or an Iroquois. Please note that France has only thirty thousand square leagues and that consequently, were she to be providing for thirty thousand inhabitants in the state of well-being offered by the primite way of life,[872] you would, in the name of the entire proletariat, renounce any further claim on property. Well, there are thirty million Frenchmen who have not an inch of land, and among their number may be found, variously, the President of the Republic, ministers, magistrates, bankers, traders, notaries, lawyers, doctors, brokers, soldiers, sailors, teachers, journalists, etc. who would not change places with an Ioway.[873] Therefore, private property in land has to do much more than you require it to do. You demand from it the right to a job, up to a certain point, up to the point where it (private property in land) has distributed among the masses - and this is in (exchange) for any given activity - as much food as (they could get) in the state of savagery. It goes further, it gives more than a right to a job, it provides work itself, and even if all it did was to pay (its) taxes, this is one hundred times more that you demand that it do.

Alas, to my great regret, I have not done with private property in land and its value. It remains for me to set out and refute in as few words as possible an argument that is specious and one might even say grave.

It will be said:[874]

“Your theory is belied by the facts. Doubtless, as long as there is abundant uncultivated land in a country, its very presence prevents cultivated land from acquiring excessive value. Again doubtless, even when all the territory has passed into the domain of private property,[875] if neighboring nations have huge areas available for the plow, the freedom of transactions will be enough to contain the value of private property in land within limits that are just. In both of these cases, it would appear that the price of land can only reflect the capital advanced and the rent, rather than the interest on this capital. From this, it has to be concluded, as you have done, that since the activity inherent in the land and the intervention of the natural resources count for nothing and cannot add to the price of harvests, they remain free of charge, and because of this common to all. All (of) this is specious. We might be embarrassed to discover the flaw in this argument and yet it is faulty. To convince yourself of this, you just have to note the fact that in France there is cultivated land whose value ranges from one hundred francs to six thousand francs per hectare, a huge difference which is explained much more by a difference in the fertility of the soils than by work done previously. Therefore you should not deny that fertility has its own inherent value; there is no sales document that does not bear witness to this. Whoever buys a piece of land examines its quality and pays a price that reflects this. If one of two adjoining fields equally well situated has rich alluvial soil while the other is arid sand, the first will undoubtedly be worth more than the second, even if both have had the same capital spent on them, and to tell the truth, buyers would not take this last issue into consideration in the slightest. Their eyes would be fixed on the future, not the past. What interests them is not what the land has cost, but what it will produce,[876] and they know that its level of production will reflect its fertility. This fertility, therefore, has its own intrinsic value, which is independent of any human work. To claim otherwise would be to displace the legitimacy of individual acquisition, by hair-splitting or rather, by paradox.

Let us therefore seek the true reason for the value of land.

And the reader should not lose sight of the fact that this question is a serious one in our present situation. Up to now, it may have been possible for economists to neglect it or treat it lightly since it had merely a passing interest for them. The legitimacy of individual appropriation was not disputed. This is no longer so. Theories that have been only too successful have thrown doubt on the right of property among the highest intellects.[877] And on what do these theories base their criticisms? Precisely in the allegation contained in the objection I have just set out. Precisely on the fact that is unfortunately accepted by all schools (of thought) that land has an intrinsic value based on its fertility and nature that has not been conferred on it by human means. Well, value does not change ownership free of charge. Its very name excludes any idea of freedom from cost. The landowner is therefore told: “You are asking me for a value that is the fruit of my labor, and you are offering me in exchange another form of value that is not the fruit either of your labor or of any other type of work, but of the bounty of nature.”

And people should be fully aware that this complaint would be deadly if it were well-founded. It has not been put forward by Messrs. Considerant and Proudhon. We find it in the writings of Smith, Ricardo, and Senior and in all economists without exception, not just as theory but as a complaint. These authors have not limited themselves to attributing a value to land that is devoid of human content, they have quite clearly deduced its consequence and inflicted on private property in land the epithets of “privilege,” “monopoly,” and “usurpation.” In truth, after having tainted it in this way, they defended it in the name of necessity. But what sort of defense is this if not a fault of dialectics that the logicians of communism have been quick to repair?

It is therefore not out of obedience to an unfortunate liking for making subtle distinctions that I am taking on this delicate subject. I would have preferred to spare both the reader and myself the boredom that I can sense will hang over the end of this chapter.

The reply to the objection I have raised to myself is to be found in the theory of value as set out in chapter V. I said there that value does not essentially imply work, and still less is it in proportion to work. I showed that value was based less on the trouble taken by the person selling it than on the trouble saved to the one receiving it, and this is the reason why I situated it in something that includes both of these elements: service. I said that great service could be rendered with very little effort, just as very great effort might provide merely a mediocre service. All that results is that work does not always receive payment that necessarily corresponds to its intensity. This is no less true for a person (living) in isolation than for one in society.

Value is established following negotiation between two people entering into a contract. Well, each of them brings his point of view to the discussion. Are you offering me wheat? What do I care how much time and trouble it has cost you? My main concern is the time and trouble it would cost me to obtain it elsewhere.[878] Your knowledge of my situation may make you more or less demanding, and mine of yours may make me more or less eager. Therefore there is not one single yardstick[879] required for rewarding what you obtain from your labor. It depends on the circumstances and on the price they set for the two forms of service that we are trying to exchange between us. Soon we will be pointing out an external force, competition,[880] whose mission is to adjust the values and to make them increasingly proportional to effort. But it is still true that this proportionality is not the very essence of value, since it is established only under pressure from a contingent fact.

Having reminded you of this, I state that the value of land arises, fluctuates, and is set like that of gold, iron, water, lawyers’ advice, medical consultations, singing, dancing, or artists’ paintings, just like any form of value. It is not subject to exceptional laws; it is a property that has the same origin, the same nature, and is as legitimate as any other form of property.[881] However, it does not in any way follow, and this must now be understood, that out of two forms of labor carried out on land, one cannot be much more favorably rewarded than the other.

Let us return once more to the particular industry, the simplest of all, and the most suited to showing us the delicate point that separates work that has to be paid for and the contribution made by nature free of charge. I refer to the humble job of water-carrier.[882]

A man has drawn and carried home one ton of water. Is he the owner of a value that is necessarily in proportion to his work? If he is, this value would be independent of the service it is able to provide. What is more it would be immutable, for work in the past is not subject to ups and downs.

Well then, the day after the ton of water has been drawn and carried, it may lose all value if, for example, it has rained during the night. In this case, everyone has been provided with water, the ton of water is no longer needed and nobody wants it. In economic terms, there is no demand for it.

On the other hand, it may acquire considerable value if exceptional needs, ones that are unforeseen and urgent, arise.

What follows? The man who works with the future in mind does not know exactly in advance the price which the future reserves for his labor. The value incorporated in a physical object[883] will be more or less great depending on whether it provides more or less of a service or, to put it better, the human labor at the root of this value receives a greater or lesser reward, depending on the circumstances. It is on these eventualities that foresight is exercised, and this too is entitled to be rewarded.

However, I ask you, what relationship is there between the fluctuations in these values, the variability of the reward that awaits the labor, and nature’s marvellous industry, the admirable laws of physics that, without any participation on our part, bring water from the ocean to the spring? Since the value of the ton of water can vary with circumstances, should we conclude that nature is paid sometimes a great deal and sometimes little or not at all for evaporation, the transport of clouds from the ocean to mountains, the freezing, melting, and the entire range of this wonderful activity that supplies the spring?

This also applies to the agricultural products.

The value of the land or rather of the capital tied up in the land has not just one element, it has two. It depends not only on the labor put into it but also on the power of society to reward this work: (it depends) on (the) demand (for it) just as much as on its supply.[884]

Here we have a field. Not a year goes by without some work being devoted to it whose effects are permanent, and the appraisal of which results in an increase in value.

What is more, roads come closer and are of better quality, security improves, markets expand, and the population increases and becomes wealthier. New opportunities open for (different) varieties of crops, (new careers) for the intelligence and skills (of the farmer), and from this change in the environment and general prosperity, there result greater rewards for current and previous work and, as a consequence, an increase in value for the field.

In this, there is no injustice nor exception in favor of property in land. There is no type of labor, from banking to manual labour, that does not demonstrate the same phenomenon. There is none that does not see its reward increase by the sole fact of the improvement in the environment in which it works. This action and reaction of the prosperity of each person on the prosperity of all and vice versa is the very law of value.[885] It is so wrong to think that we can deduce from this an alleged value inhering in the land itself or its productive powers when intellectual work, the various jobs and trades where neither material things nor the contribution of the laws of physics intervene, enjoy the same advantage, which is not exceptional but universal. Lawyers, doctors, teachers, artists, and poets are better paid for a given level of work to the extent that towns and the nations to which they belong increase in well-being, that a taste for or the need for their services expands, that the public demands more from them and is simultaneously more willing and able to pay more for them. The simple sale of a client list, market research, or a customer base is made on this principle. What is more, the Basque giant and Tom Thumb who earn a living from the simple exhibition of their abnormal size, exhibit it more advantageously to the curiosity of a large and prosperous crowd in major cities than to a few poor villagers. Here demand not only contributes to value, it creates it entirely. How could we find it exceptional or unjust that demand also influences the value of land or farm products?

Will we also say that land may thus attain an exorbitant value? Those who say so have probably never reflected on the huge quantity of work that farm land has absorbed. I am bold enough to say that there is not a field in France that is worth what it has cost and that can be exchanged for as much labor as it required in order to be brought to the level of productivity that it currently enjoys. If this comment is well-founded, it is decisive. It does not allow the faintest whiff of injustice to attach itself to private property in land. This is why I will return to it when I have to examine Ricardo’s theory of rent.[886] I will have to demonstrate that we have also to apply to landed capital the general law that I have expressed thus: as capital increases, products are shared among the capitalists or landowners and the workforce so that the relative share of the former constantly decreases although their absolute share increases, while the share of the latter increases on both counts.[887]

This illusion that leads men to believe that productive powers have an intrinsic value because they have utility has dragged in its wake a great many disappointments and catastrophes. It has often incited them to (the) premature colonization (of other lands), the history of which is just one lamentable list of martyrdoms.[888] Their reasoning was as follows: “In our country, we are able to obtain valuable things only through work, and when we have worked all we have is valuable only in proportion to our labor. If we went to Guiana, the banks of the Mississippi, Australia, or Africa, we would take possession of vast tracts of land that was uncultivated but fertile. We would become landowners (and our reward would come from) both the value we would have created and the intrinsic value inherent in this land.” They go off and cruel experience is not slow in confirming the truth of the theory I am setting out here. They work, they clear the land, and wear themselves out. They are exposed to privation, suffering, and disease and then, should they want to sell the land they have made suitable for production, they do not obtain what it has cost them and they are obliged to acknowledge that value is of human creation. I challenge anyone to cite me one instance of colonization that, at the beginning, was not a disaster.

Trans. of quote: “More than one thousand laborers were directed to the Swan River,[889] but the extremely low cost of the land (one shilling and sixpence per acre, or less than 2 francs) and the high cost of labor gave them the desire and opportunity to become landowners. Capitalists no longer found anyone to work for them. A capital of five million was swallowed up and the colony became a scene of desolation. As the workforce had abandoned their employers to achieve the deceptive satisfaction of being landowners, farm machinery rusted, seed became moldy, and herds died from lack of care. Only a terrible famine could cure workers of their infatuation. They returned to ask the capitalists for work, but the time for that had passed.” (Proceedings of the South Australian Association).

Original from Carey: Upwards of a thousand labourers were sent out to Swan River Colony, but the extreme cheapness of land (1s. 6d. per acre) and the extravagant price of labour, furnished them with such facilities and inducements to become land owners, that the capitalists were every where left without persons to cultivate their lands. In consequence, capital to the amount of £200,000 perished. A scene of desolation ensued. The labourers having deserted their masters for the delusive desire of being the owners of land, implements of agriculture were allowed to rust on the banks of the rivers—seeds of various kinds rotted in casks on the beach for want of sowing, and sheep, cattle and horses perished because there was no one to attend them. The crisis came—hunger cured the labourers of their infatuation, and they returned and demanded from the capitalists they had ruined, the work which they had deserted. It was not to be had. —Proceedings of the South Australian Association, June, 1834.[890]

Attributing this disaster to the low cost of land, the Association set its price at 12 shillings. However, Carey,[891] from whom I have borrowed this quotation,[892] adds that the real cause was that, as the workers were persuaded that the land had intrinsic value independent of work, they rushed to grab this so-called value to which they attributed the power of potentially guaranteeing them a yearly rent.

What follows supplies me with an argument even more unanswerable.

Trans: “In 1836, private property in land on the Swan River was being acquired from its original owners for one shilling an acre.” (New Monthly Magazine)

Original from Carey: The Swan River Colony is in a very flourishing state. Landed estates are to 'be purchased from the original settlers at one shilling per acre.—New Monthly Magazine, October, 1836.[893]

So, this land that had been sold by the company at 12 shillings, to which buyers had devoted a great deal of work and money, was being sold again by them at one shilling! Where then was the value of the natural and indestructible productive power (of the land)?[894]

This huge and important subject of the value of land has not, I feel, been exhausted by this chapter written in fits and starts in the midst of constant interruptions.[895] I will come back to it, but I cannot end without submitting one observation to readers and in particular to economists.

These illustrious scholars, who have caused science to make so much progress and whose writings and lives breathe benevolence and philanthropy, who, at least from one aspect and within the area of their research, have revealed the true solution to the social problem, such as Quesnay, Turgot, Smith, Malthus, and Say, have nonetheless not avoided, I do not say refutation, since this is always a possibility, but denigration, belittlement, and crude insults. Attacking their writings, and even their intentions, has almost become a fashion. Perhaps it will be said that in this chapter I am providing weapons for their detractors, and the time would be certainly ill-chosen for me to turn against those whom, and this I state solemnly, I regard as my initiators, guides, and masters.[896] But after all, is not my highest allegiance to the truth, or what I sincerely see to be the truth? What book is there in the world into which no error has crept? Well, (one error) in political economy, if you torture it, and seek (out) its logical consequences, it (the one error) will contain all (the others); and will end in chaos. There is thus not a single book from which a proposition, taken in isolation, one that is incomplete, wrong, and consequently contains a world of errors and incoherence, cannot be drawn. In conscience, I believe that the definition given by economists to the word “value” is in this category. It has just been seen that this definition has led these very people to cast dangerous doubt on the legitimacy of private property in land, and by extension capital, and they have been stopped on this dangerous path only by an inconsistency. This inconsistency has saved them. They have resumed their journey down the path of truth and their error, if it is one, is an isolated blemish in their books. Socialism has come along and taken hold of this erroneous definition, not in order to refute it but to adopt and corroborate it, make it the starting point of its propaganda and set out all of its consequences. In our time social danger has been imminent, and it is for this reason that I believed it to be my duty to express my ideas in full and go back to the source of this erroneous theory. If people wished to infer that I am parting from my masters, Smith and Say, my friends, Blanqui and Garnier, solely because in one line lost amid their learned and excellent writings they may have used the word value wrongly, in my opinion, and if they concluded from this that I no longer have any faith in political economy and economists, all I can do is to protest. Besides, the most energetic of (my) protests lies in the very title of this book.

 


 

X. Competition

Source

(1846.??) "Competition" (Concurrence), Encyclopédie du dix-neuvième siècle: répertoire universel des sciences, des lettres et des arts avec la biographie de tous les hommes célèbres, ed. Ange de Saint-Priest (Paris: Au bureau de l'Encyclopédie du dix-neuvième siècle, Impr. Beaulé, Lacour, Renoud et Maulde, 1846). Tome huitième, pp. 389-400. Probably early 1846. Republished as "On Competition" in JDE, May, 1846. See T. 64. Not in OC. Revised for EH, 1st ed. chap. 10.

(1846.05.15) "On Competition" (De la concurrence), JDE, May 1846, T. XIV, no. 54, pp. 106-22; also EH chap. 10. 2nd half very similar, 1st half quite different. A note states that this article was written for l’Encyclopédie du dix-neuvième siècle (no date given). [DMH] [CW4]??

Editor’s Introduction

One of the important additions he would make for the EH1 version of this article was a new section on what he called “les causes perturbatrices” (disturbing factors)[897] which prevent the natural harmony of the market and competition from creating as much wealth as it might in their absence. In this article here, Bastiat points out that “in modern societies, competition is far from fulfilling its natural role; our laws hinder it at least as much as they favor it” and mentions in particular “conquest, monopolies, trade restrictions, privileged positions, high government posts and influence, the trafficking in administrative deals, and loans from public funds” as examples of things which prevent the beneficent effects of competition being felt. He does not yet use the term “disturbing factors,” although he had referred to it a few times since his first use in his “Letter to Lamartine” (JDE, Feb. 1845),[898] probably as he had not yet fully incorporated it into his thinking.

In the new introduction he wrote for the EH1 version he argues that the socialists falsely accuse competition of causing the harms which he believes results from these disturbing factors:

While the Socialists see Competition as the cause of all harm, it is in the violations it (competition) receives that one has to look for the disturbing factor which (harms) all the good.

In the four new pages of material he inserted he observes that:

I will now set out general laws that I believe to be harmonious, and I am confident that the reader also will begin to guess at the existence of these laws, that they act in favor of the community and consequently of equality. However, I have not denied that the action of these laws has been profoundly disrupted by disturbing factors. Therefore, if we now find some shocking example of inequality, how can we judge it without being conversant with both the regular laws of social order and the disturbing factors which distort these laws?

Bastiat’s use of the term “ceteris paribus” (or “all other things being equal”)[899] was not common among political economists of his period. John Stuart Mill used it as early as 1836 in “On the Definition and Method of Political Economy” and in A System of Logic (1843) but there is no evidence that Bastiat was aware of his work.[900] He first used it in a paper he wrote in 1834 on “Reflections on the Petitions from Bordeaux, Le Havre, and Lyons Relating to the Customs Service” (April 1834),[901] and began using it in earnest in 1846 and thereafter. Thus, it appears that Bastiat was an independent early adopter of the phrase and it reveals the depth and growing sophistication of his thinking about economic problems and their solution.

There is also here an early reference to a concept which Bastiat will develop much further in the article “Natural and Artificial Organisation” (January 1848) and an unfinished chapter in EH2 Chapter 22 “Le moteur social," namely “le mécanisme social” (the social mechanism) By this Bastiat meant that society was a “mechanism” (le mécanisme social) or what we might today call a “process,” which had moving parts, like a watch or a clock, which consisted of “les rouages” (cogs and wheels), “les ressorts” (springs), and “les mobiles” (the movement, or driving or motive force). Bastiat described the social mechanism as “a prodigiously ingenious mechanism (which) is the subject of study of political economy.” Here he mentions it but does not go into much detail except to assert that competition was the driving force of this social mechanism.[902]

One of Bastiat’s innovations in economic theory was to stress the importance of consumptions as “the end” or purpose of economic activity and that production was “the means” to attain that end, thus turning classical economic theory on its head. We can see several references to this new way of thinking in this essay, particularly in the passage where he states unequivocally that “the real focus of economic science” were “the laws of consumption, and what promotes it, equalizes it, and makes int moral”[903] and chastises the classical economist Pellegrino Rossi for ignoring it.

Related to this stress on consumption was Bastiat’s view about the importance of leisure which increasing prosperity made possible. He will return to this question later in 1849 in two important publications, his pamphlet on Capital and Rent (Feb. 1849) and in “Letter No. 4: F. Bastiat to P. J. Proudhon” (26 November 1849) in his debate with Proudhon on Free Credit.[904] In Capital and Rent where he says:

And here we can glimpse one of the finest harmonies in the social world. I am referring to Leisure, not that leisure that the warlike and dominating castes organized for themselves through the plundering of the workers, but the leisure that is the legitimate and innocent fruit of past activity and saving.[905]

And in a virtual hymn to the befits of leisure made possible by the accumulated wealth and general prosperity made possible by the free market, he states:

Whatever sincere admiration I have for the admirable laws of social economy, whatever period of my life I have devoted to studying this science, whatever confidence is inspired in me by its solutions, I am not one of those who believe that it embraces the entire destiny of man. Production, distribution, circulation, and the consumption of wealth are not the sum of all things for man. There is nothing in nature that does not have a final aim, and man also has to have a goal other than that of providing for his material existence. Everything tells us this. Where do the sensitivity of his feelings and the ardor of his aspirations, his ability to admire and experience enchantment come from? Whence comes his ability to find in the slightest flower a subject of contemplation, or the excitement with which his senses receive and transmit to his spirit, like bees to the hive, all the treasures of beauty and harmony that nature and art have spread around him? How shall we explain the tears that moisten his eyes when he hears about the slightest act of devotion? What is the origin of that ebb and flow of feeling which his heart fashions, much as it directs his life-blood? Where does his love of humanity and his reaching out for the infinite come from? These are the marks of a noble destiny, which is not limited by the narrow bounds of industrial production. There is a purpose to man’s existence. What is it? This is not the place to raise this question. But, whatever it is, what we can say is that he cannot achieve it if, bowed under the yoke of inexorable and constant work, he has no leisure to develop his senses, his affections, his mind, his sense of the beautiful, and what is purest and most elevated in his nature; the germ of which is in all men but in a latent and inert form because of a lack of leisure in all too many of them.[906]

There are several significant differences between the two versions of the essay which should be noted. The revised chapter in EH1 is 50% longer (12,000 vs. 8,000 words) than the JDE article. The original Introduction of 21 paragraphs (2,100 words) was replaced in the EH version with a new introduction of 4,000 words in which Bastiat more directly replied to the socialists’ criticism, which had been amplified by the February Revolution, that competition was “anarchic” and harmed the interests of the workers. A short new section of 648 words was added with a more detailed discussion of how many people laboured to produce simple everyday objects in order to show that all labour is “cooperative labour.” And finally, he added a new section of 1,895 words on the justice of the monetary return to capital, the mutually dependent relationship between the two classes of capitalists and workers, the effect of competition on wages, and the idea that there was a “centrifugal” as well as a “centripetal” force at work in competition. Socialists focussed on the centrifugal force which acted to pull things apart and ignored the centripetal force which drew things together. Bastiat believed both forces needed to be taken into account in order to understand the true impact which competition had on society.

Text

[new introduction added to EH1 version]

No word in the entire vocabulary of political economy generates as much fury in modern reformers as competition, to which, in order to make it even more odious, they never fail to add the adjective, anarchic.[907]

What does anarchic competition mean? I do not know. What might we substitute for it? I do not know that either.

I do hear people shouting Organization! and Association! at me.[908] But what is being said? We have to be clear once and for all. I have to know what type of authority these writers mean to exercise over me and all other people around the world, for in truth I acknowledge only one, that of reason, if they are able to marshal it on their side. Well then, do they want to deprive me of the right to use my judgment when it is a question of my own existence? Do they aspire to remove from me the ability to compare the services I provide with those I receive? Do they mean to have me act under the influence of the coercion they exercise and not in accordance with my (own) mind? If they let me retain my freedom, competition will continue to exist. If they take it away from me, I become merely their slave. The association will be free and voluntary, they say. Good! In that case, however, each group of members of these associations will have the same relationship with other groups as individuals now have with other individuals, and we will still have competition. Association will be total. Oh, this is becoming more than a joke. Goodness me! Anarchic competition is currently causing distress in society and, in order to cure this disease, according to your book, we have to wait for every man on earth, all the French, English, Chinese, Japanese, Kaffirs, Hottentots, Lapps, Cossacks, or Patagonians to come to an agreement to shackle themselves forever to one of the forms of association that you have dreamt up! Be careful, this is to admit that competition is indestructible, and will you be so bold as to say that a phenomenon that is indestructible, and therefore Providential, can be pernicious?

After all, what is competition? Is it something that exists and acts of its own accord like cholera?[909] No, competition is merely the absence of oppression. As far as I am concerned, I wish to choose for myself and do not want anyone else to make choices on my behalf, against my will that is all. And if someone claims the right to substitute his judgment for mine in matters that concern me, I will ask to substitute mine for his in transactions that concern him. Where is the guarantee that things will go (any) better? It is obvious that competition is another word for freedom. If you destroy the freedom to act, you destroy the possibility and consequently the right to choose, judge, and compare; you kill the mind, you kill thought, and you kill man himself. Whichever way they go, modern reformers always end up at this point; in order to improve society, they begin by destroying the individual on the pretext that all harm arises from this source, as though all forms of good did not arise from it too.

We have seen that services are exchanged for other services. Basically, each of us in this world bears the responsibility of meeting his satisfactions through his (own) efforts. Therefore, if someone saves us some effort, we have to save him some in return. If he provides us with a form of satisfaction that results from his effort, we have to do the same for him.

But who will compare the two? For between these efforts, the trouble taken, and services exchanged, there has to be a comparison made in order to establish equivalence and justice, unless we are made subject to the rule of injustice, inequality, or chance, which is another way of eliminating the influence of (the) human mind. There has to be either one or more judges. Who will these be? Is it not only natural that, in each situation, needs are judged by those who experience them, satisfactions by those who seek them, and efforts by those who exchange them? And are people seriously proposing to substitute for this universal vigilance of the interested parties a social authority (even if it is the authority of the reformer himself), which is responsible for taking decisions on the subtle conditions of the countless numbers of these exchanges all around the world? Do they not see that this would be to create the most fallible, universal, closest, inquisitorial, unbearable, immediate, personal, and let us say, fortunately, the most impossible of all the forms of despotism that the brains of pashas or muftis have ever been able to conceive?

Competition is nothing other than the absence of an arbitrary authority which acts as a judge on our exchanges. To know this entails knowing that competition is indestructible. Excessive force may certainly restrict, counter, and hinder the freedom to barter just as it can the freedom to walk, but it cannot destroy either of these without destroying man (himself). This being so, it remains to be seen whether competition acts for the benefit or misfortune of mankind, a question that amounts to this: Is the human race progressive by nature or inevitably backward?

I have no fear in saying that competition, which we may well call freedom, in spite of the repugnance it arouses and the denunciations that harry it, is the law of democracy by definition. It is the most progressive, egalitarian, and also the most communitarian[910] of all the laws to which Providence has entrusted the progress of human society. It is this law that has caused the enjoyment of the things that nature appeared to have given free of change only to certain regions, to move successively into the common domain. It is this law that also brings into the common domain all the achievements that the genius of each century has added to the wealth of the generations which follow, thus leaving people only some additional tasks to be exchanged among themselves, without anyone managing to get paid, as was hoped, for the contribution made by natural resources. And if the labor involved, as always happens at the beginning, has a value disproportionate to its intensity of effort, it is competition once again that imperceptibly but constantly restores an equilibrium which is sanctioned by justice and which is more accurate than that which the fallible wisdom of a human judge would vainly seek to establish. Far from competition’s working in the direction of inequality, as it is accused of doing, it can be stated that all artificial inequality can be attributed to its absence; and if the abyss is deeper between the great Dalai Lama and a pariah than between the President of the United States and an artisan, this is because competition (or freedom) is restricted in Asia but not in America. And this is why, while socialists see in competition the cause of every evil, it is in the attacks made on competition that we should seek the disturbing factor[911] of all good. Even though this great law has been misunderstood by socialists and their followers, and even though it is often brutal in its workings, there is no law more fruitful in social harmonies, beneficial in general results, or bearing witness so strikingly to the immeasurable superiority of the designs of God to the vain and feeble joint efforts of humanity.

I should recall at this point the unique but indisputable result of the social order, to which I have already drawn the reader’s attention,[912] and that force of habit only too often causes us to overlook. It is that the sum of satisfactions that reaches each member of society is far higher than the sum he would be able to get for himself through his own efforts. In other words, there is an obvious disproportion between what we consume and our labor. This phenomenon, which each of us can easily confirm if he examines his own behaviour for a moment, should, I think, inspire some gratitude in us for the society to which we owe it.

We arrive on earth totally without possessions, tormented by countless needs, and equipped only with the faculties we need to meet them. A priori it would appear that all we have the right to expect is to obtain satisfactions commensurate with our labor. If we have more, infinitely more, to whom do we owe this surplus? Precisely to the natural organization against which some people are constantly speaking out when they are not trying to destroy it.

In itself this phenomenon is truly extraordinary. That some people consume more than they produce is only too easy to explain if, in some way, they usurp the rights of others and receive services without rendering any (in return). But how can that be true of everyone at the same time? How can it be that, after exchanging services without using coercion, without plunder and on the basis of equivalence, each person can truly say to himself: I use up in a single day more than I could possibly create in a century!

The reader will understand that the additional factor which resolves the problem is the ever more efficient contribution made by natural resources in the work of production. It is the gratuitous utility constantly flowing into the domain of the Commons,[913] it is the work of heat, cold, light, gravity, electrical attraction, and the compressibility of steam, progressively adding itself to human labor, thus decreasing the value[914] of services by making them easier (to get).

Indeed, I would have set out the theory of value very badly if the reader thought that value decreases immediately and all by itself through the sole (fact of) the co-operation of a natural force, (thereby) releasing human labor (from the task). No, this is not so, for in this case one could say, along with the English economists, that value is proportional to (the) work (done). The person who gets help from a natural and gratuitous force (of nature) provides his service more easily, but in doing this he does not willingly renounce any part of his customary remuneration. To make this happen, there needs to be some external coercion, one that is strict but not unjust. It is competition that produces this coercion. As long as competition does not intervene, and as long as the person who has used a natural resource conceals his secret, this natural resource is unquestionably free of charge but not yet common to all. The achievement has been made, but solely for the benefit of a single man or class. It is not yet a benefit for the entire human race. Nothing in the world has yet changed, that a type of service now demands payment in full, although it has partly been relieved of the burden of effort. On the one hand there is one man, who requires from his fellow-men the same labor as before although he offers them a reduced amount of his labour, and on the other the entire human race, which is still obliged to make the same sacrifice of time and labor in order to obtain a product now produced in part by nature.

If this situation were destined to persist, a certain amount of inequality would be introduced into the world with every invention. Not only would we not be able to say that value is proportional to work but we would not be able to say either that value tends to be proportional to work. All that we have said in preceding chapters on gratuitous utility[915] and on the expanding Commons[916] would be an illusion. It would not be true that services are exchanged for other services in such a way that the gifts of God pass from person to person as a bonus,[917] until they reach their final destination, namely the consumer. (Instead, it would mean that) each person would get paid for ever more, in addition for the work he has done, for a share of the forces of nature which he might have succeeded in using only once. In a word, the human race would be established on the principle of universal monopoly instead of on the principle of the expanding Commons.

But this is not so. God, who gave generously to all His creatures heat, light, gravity, air, water, land, the marvels of plant life, electricity and so many other benefits that I cannot list them all, God, who has placed in individuals the self-interest that, like a magnet, constantly draws everything to itself, this God, I say, has also placed within the social order another mainspring (of action) to which He has entrusted the care of maintaining his gifts so that they conform to their original objective: things that are gratuitous and common to all. This mainspring (of action) is competition.

Thus, self-interest is the indomitable individual force that drives us to seek progress, makes us achieve it, and spurs us on, but which also makes us inclined to monopolize it. Competition is the no less indomitable humanitarian force that snatches progress as it is achieved from the hands of the individual in order to make it part of the common heritage of the great human family. These two forces, which can be criticized when considered separately, constitute social harmony when taken together because of the interplay of their elements in combination.

And we might say in passing, it is not surprising that the individual, represented by the interest of man as a producer,[918] has since the dawn of time risen up against competition, condemning the latter, seeking to destroy it, and calling on the assistance of force, fraud, privilege, sophism, monopoly, (trade) restrictions, government protection, etc. The morality of its means is eloquent of the morality of its purposes. But what is astonishing and painful is that the science of political economy itself, false science it is true, disseminated with so much ardor by the socialist schools in the name of philanthropy, equality, and fraternity, has espoused the cause of individualism in its narrowest expression and has deserted that of humanity.

Let us now see how competition acts.

Under the influence of self-interest, man is always and by necessity on the lookout for circumstances that can increase the value of his services. He is not slow to realize that, with regard to the gifts of God, he can use them to his advantage in three ways:[919]

1. he can take sole possession of these gifts themselves;

2. he alone knows the process by which it is possible to use them;

3. he alone possesses the tools that can be used to make them co-operate (in production).

In any of these instances, he will provide a small amount of his own labor in exchange for a great deal of the labor of others. His services have a great deal of relative value and we tend to believe that this excess value is inherent in the natural resources. If this were so, this value could not be lowered. The proof that value lies in the service is that we will see competition decreasing (both the amount of labour and the natural resources used).

1. Natural resources, the gifts of God, are not distributed uniformly around the globe. What an infinite succession of plant life there is, from the regions of conifers to those of palm trees! Here the land is more fertile, there the warmth is more life-giving; at this place stone is found, there gypsum and elsewhere iron, copper, and coal. Waterfalls are not found everywhere, and not everywhere can we benefit equally from the effect of the wind. The mere distance at which we are from the objects essential to us causes endless differences in the obstacles to our efforts. Everything, even the capabilities of people, varies to some extent with climate and race.

It is easy to understand that without the law of competition this inequality in the distribution of the gifts of God would lead to a similar inequality in the relative condition of men.

Whoever is within reach of a natural advantage would profit by it for himself but would not let it profit his fellows. He would only permit other people to share in it, if he acted as the middleman and charged an exorbitant amount, the upper limit of which would be arbitrarily set by him. He would give his services any value that suited him. We have seen that the two extreme limits between which that value is set are the trouble taken by the person providing the service and the trouble saved by the person receiving it. Without competition nothing would stop the setting of that value at the highest limit. For example, someone in the tropics would say to someone in Europe:[920] “Because of my sun I can produce a given amount of sugar, coffee, cocoa, or cotton with (an) effort equal to ten, whereas since in your cold region you need to resort to greenhouses, heaters, or shelters and can produce sugar only with (an) effort equal to one hundred. You are asking me for my sugar, coffee, or cotton and you would not be upset if, in the transaction, I took account only of the trouble I have taken. However, for my part I look in particular to the trouble I am saving you, for since I know what the limit of your resistance is, I make it the limit of what I am asking. Since what I produce with an effort equal to ten you are able to produce at home only with an effort equal to one hundred, if I asked in return for my sugar a product that cost you trouble equal to one hundred, you would be sure to refuse me, but all I am asking for is trouble equal to ninety-nine. You may sulk for a time, but you will come round, for at this rate there is still a benefit for you in this exchange. You find dealing on this basis unjust, but after all it is not to you but to me that God has given the gift of high temperature. I know that I am in a position to exploit this Providential benefit by depriving you of it if you do not agree to pay me a tax, for I have no competitors. So, here is my sugar, cocoa, coffee, and cotton. Take them on the conditions I set, or either grow them yourselves, or do without.”

It is true that people in Europe could in turn say much the same thing to people in the tropics. “Dig up your land,” they might say, “drill wells, prospect for iron and coal, and congratulate yourselves if you find any, for if you do not, we are determined to set our requirements at the limit. God has given us two precious gifts. We take what we need from them first, and then we do not allow others to touch them without paying us a windfall tax.”

If things happened like this, scientific rigor would still not allow us to attribute to natural resources the value that is essentially based on services. But it would be allowable to mistake this, for the result would be absolutely identical. Services would still be exchanged for other services, but they would show no tendency to be measured by effort, by labor. The gifts of God would be personal privileges and not common goods,[921] and perhaps we would be able with some justification to complain of having been treated by the Author of (all) things in such an irredeemably unequal fashion. Would we be brothers here below? Could we consider ourselves the sons of a common Father? A lack of competition, that is to say of freedom, would first of all be an invincible obstacle to equality. A lack of equality would rule out any idea of fraternity. Nothing would remain of the motto of the Republic.

But with competition we would see all these one-sided exchanges, this monopolization of the gifts of God, these offensive claims in the pricing of services, and these inequalities in the exchange of effort, becoming absolutely impossible.

And let us note first of all that competition is bound to intervene, triggered as it is by these very inequalities. Labor is instinctively drawn to the areas in which it is best rewarded and never fails to bring to an end this abnormal advantage, so that inequality is nothing other than a spur that drives us in spite of ourselves toward equality. This is one of the finest end results of the social mechanism. It seems that the infinite goodness who has distributed His benefits around the earth has selected greedy producers as the means of providing a fair distribution among all, and indeed it is a marvelous sight to see private interest constantly realizing what it is always trying to evade. Man qua producer is inevitably, necessarily, attracted by big rewards, the pursuit of which brings things back to normal. He follows his own self-interest, and what does he encounter without realizing it, wishing it, or seeking it? The (general) interest.

Thus, to return to our example, for the very reason that the people in the tropics, by exploiting the gifts of God, receive an excessively high reward, they attract competition. Human effort is drawn to this with an enthusiasm, if I may put it this way, proportional to the magnitude of the inequality, and will not rest until it has eliminated the latter. Under the influence of competition, in succession, work in the tropics equal to ten is seen to be exchanged for labour in Europe equal to eighty, then at sixty, then at fifty, forty, twenty, and finally at ten. Following these particular natural laws, there is no reason things should not settle themselves in this manner, that is to say, for services that are exchanged not to be measured in terms of the labor or the effort expended, with the gifts of God being exchanged on both sides, into the bargain. Well, when things have reached this situation, you have to appreciate the revolution that has taken place in order to applaud it. First of all, the effort made on either side is equal, which is likely to satisfy the human conscience which is always thirsting after justice. And then what has happened to the gifts of God? This question deserves the reader’s undivided attention. It has not been taken away from anyone. In this respect, let us not be impressed by the outcry from the tropical producer. Brazilians, as consumers themselves of sugar, cotton, or coffee, always benefit from the heat of the sun, for this beneficial sun (of ours) has endlessly helped the work of production. What they have lost is merely the unjust ability to levy a windfall profit on the consumption of the inhabitants of Europe. Because it was gratuitous, the benefit of Providence was bound to become and has become commonly available, since gratuitousness and things common to all are essentially the same.

The gift of God has become commonly available, and I beg the reader not to lose sight of the fact that I am making use of a specific fact in order to elucidate a universal phenomenon. It has become common to all men. This is not oratory, but the expression of a mathematical truth. Why is this fine phenomenon so misunderstood? Because what is common to all is achieved (when there is) the elimination of value, and our minds find it very difficult to grasp negations. But, I ask you, when in order to obtain a given quantity of sugar, coffee, or cotton I hand over just one tenth of the trouble I would need to take to produce them myself, because in Brazil the sun carries out nine-tenths of the work, is it not true that I am exchanging labor for labor? And am I not positively obtaining, in addition to Brazilian labour and as a bonus, the co-operation of its tropical climate? Can I not state with strict accuracy that I have been placed, that all men have been placed, on the same terms as the Indians and Americans when it comes to sharing the bounty of nature, that is to say the goods are free of change?[922]

[end of the new introduction added to the EH version]

There is a country, England, which has numerous coal mines. Obviously this is a considerable local advantage, especially if we assume, as I will, to keep the argument simple, that there is no coal on the continent. As long as it is not traded, the advantage to the English is to have a greater abundance of fuel than other nations, which they can get without much effort and without taking too much of their valuable time. As soon as trade appears, on the assumption that there is no competition, the exclusive possession of the mines makes it possible for them to ask for high prices and to set a high price on their efforts. As we can neither make these efforts ourselves nor go elsewhere, we will have to put up with this. English labor as applied to this type of activity will be very well paid; in other words coal will be expensive, and nature’s bounty may be thought of as having been conferred on one nation rather than on the human race.

This state of affairs, however, cannot last. There is a great natural and social law which opposes it, namely competition. For the very reason that this type of work is very well paid in England, it will be much sought-after, for people are always looking for high earnings. The number of miners will increase both through addition and through the birth of children. They will offer themselves at a discount and will be content with constantly declining pay until it reaches the normal rate, the level paid generally in the country for all similar work. This means that the price of English coal will decrease in France and that a given quantity of French labor will obtain an increasingly large quantity of English coal, or rather of the English labor that is bound up in the coal. In the end, it means, and this is what I ask you to note, that the gift that nature appears to have given to England has in reality been given to the entire human race. Coal from Newcastle is generously given free of charge to all men. This does not constitute either a paradox or an exaggeration: it is generously given to them free of charge, like the water from a stream, on the sole condition that people take the trouble to go in search of it or that those who take this trouble on our behalf are compensated for this. When we buy coal, it is not the coal that we are paying for but the labor required to extract it and transport it. We limit ourselves to returning an equal quantity of labor that we have attached to our wine or silk. It is so true that the generosity of nature has been extended to France that the work we return is no greater than the work we would have needed to do if the deposit of coal had been in France. Competition has brought about equality between the two nations with regard to coal, except for the inevitable and slight difference that arises from distance and transport.[923]

I have cited two examples, and in order to make the phenomenon even more striking in its grandeur I have chosen international relations operating on a vast scale. I fear that I may thereby have fallen into the trap of shifting the reader’s gaze from the very same phenomenon happening constantly around us in our most mundane transactions. Let him pick up the most humble of objects, a glass, a nail, a piece of bread, a piece of fabric or a book. He should meditate a while on these commonplace objects. Let him ask himself whether, without competition, such an incalculable mass of free utility would truly have remained free for the producer but would never have become free for the human race, that is to say, would never have become common to all. He should tell himself that, thanks to competition, when he buys this bread he is not paying anything for the sunshine, the rain, the frost or the laws of plant physiology or even for the intrinsic action of the soil, whatever anyone says. He is paying nothing for the law of gravity used by the miller, nothing for the law of combustion used by the baker and nothing for the animal force used by the carter. He is paying only for the services rendered and the efforts made by human agents, and he should realize that without competition he would have had to pay in addition a tax for the intervention of all these natural resources. This tax would have had no limit other than the difficulty he himself would have had in procuring bread for himself through his own efforts and that consequently an entire life of work would not be enough to make the payment asked of him. Let him reflect that every single object that he uses can provoke and must provoke the same thoughts, and that these thoughts are true for every person alive on the planet. At this point he will understand the flaws in socialist theories that, merely seeing the surface appearance of things,[924] the epidermis of society, have spoken out so irresponsibly against competition, that is to say, against human freedom, and will realize that since competition safeguards the twin character of gratuitousness and common availability of the gifts that nature has inequitably distributed over the planet, it has to be considered as the basis of a just and natural process of equalization. Competition has to be admired as the force that keeps in check the selfishness of self-interest, with which it combines so creatively that it is at once a brake on the avidity of this self-interest and a spur to its activity. Competition has to be blessed as the most striking evidence of the impartial solicitude of God for all His creatures.

From the preceding paragraph, the solution to one of the most controversial questions, that of the freedom to trade between nations, may be deduced. If it is true, as I think is incontestable, that the various nations around the world are obliged by competition to exchange only labor and efforts that are increasingly leveled downward and to hand over mutually, into the bargain, the advantages of nature that each possesses, then how blind and absurd are those nations which reject foreign products by law on the pretext that they are cheap and that they have little value in comparison to their total utility, that is to say, precisely because they comprise a huge share of free utility!

I have already said this and I repeat it here: a theory inspires confidence in me when I see that it agrees with universal practice. Well, it is certain that nations would trade certain products with each other if they were not forbidden to do so by force. Bayonets are needed to stop them, and therefore it is wrong to stop them.[925]

2. Another circumstance that puts certain individuals in an exceptionally favorable situation with regard to their payment is the exclusive knowledge of the processes by which it is possible to seize control of natural resources. What we call an invention is an advance made by human genius. We have to see how these fine and peaceful conquests, which at the outset are a source of wealth for those who make them, soon become, under the influence of competition, the common and free heritage of all mankind.

The forces of nature really do belong to everybody. Gravity, for example, is communally owned property;[926] it surrounds us, penetrates us, and dominates us. However, if there is just one way of making it contribute to a useful and planned result, and one man knows this way, this man is able to set a high price on his efforts or refuse to make them except for a very considerable payment. His claims in this regard will have no other limit than the point at which he demands from consumers a sacrifice that is greater than that imposed on them by the old process. For example, he may have succeeded in eliminating nine-tenths of the labor required to produce a product X. But X currently has a price that is determined by the effort required for its production using the standard method. The inventor sells X at the market price; in other words, he is paid ten times as much for his effort as his rivals are paid for theirs. This is the initial phase of invention.

Let us note first of all that this does not violate justice. It is just that the person who reveals a useful process to the world should be rewarded for this: To each according to his ability.[927]

Let us also note that up to now the human race, apart from the inventor, has made only a potential gain, one in prospect so to speak, since, in order to acquire product X it is obliged to make the same sacrifices as it made in the past.

Nevertheless, the invention enters its second phase, that of imitation. It is in the nature of excessive rewards to arouse envy. The new process becomes widespread, the price of X keeps decreasing and payment for it decreases also, especially as the imitation becomes distant from the time of the invention, that is to say, as it becomes easier, less risky, and because of this, less attractive. Indeed, there is nothing in this that cannot be allowed by the most ingenious and impartial legislation.[928]

Finally the invention reaches its third phase, its definitive period, that of its universal diffusion, common availability, and gratuitousness. It comes full circle when competition has brought payment to producers of X back to the general and normal rate for all similar production. At this point the nine-tenths of the efforts saved by the invention in these circumstances are a victory for the benefit of the entire human race. The utility of X is the same but the nine-tenths have been added to it by gravity, which in the past was common to all in principle and which has become common to all in this particular application. This is so true that all the consumers on the planet are allowed to purchase X for the sacrifice of one-tenth of the effort it cost in the past. The surplus has been totally eliminated by the new process.

If you are willing to consider that there is not one human invention that has not gone through this cycle, that X in this instance is an algebraic sign representing wheat, clothing, books, or ships whose production has caused an incalculable mass of effort to be eliminated by the plough, the loom, the printing press, and sails, and that this observation applies to the humblest of tools just as it does to the most complicated mechanism, to nails, wedges and levers, just as to steam engines and the electric telegraph,[929] I hope that you will understand how the following major problem is solved in the context of the human race: A huge quantity of useful things or things which can be enjoyed, that is forever growing and ever more equally distributed, comes along to reward each given quantity of human labor.

3. I have shown that competition serves to move both the forces of nature and the processes by which these are harnessed into the domain of common availability, and gratuitousness. All that I still have to do is to make clear that it fulfills the same function with regard to the tools we use to set these forces in motion.

It is not enough for there to be forces in nature such as heat, light, gravity, and electricity. It is not enough for the mind to conceive the means of making use of these; you also need tools to transform mere intellectual conceptions into a physical reality and supplies to keep alive the people while they are undertaking the work.

There is a third factor that favors an individual or a class of people with regard to remuneration, and that is to possess capital. He who holds the tool that is essential to the workers, the materials on which the labor is to be done, and the means of existence[930] that are to be consumed during the production, can determine his rate of remuneration. This principle is certainly fair, for capital is merely effort made previously, which has not yet been rewarded. The capitalist is doubtless in a good position to impose his will, but we should note that, even without competition, there is a limit that his demands can never exceed. This limit is the point at which his remuneration would absorb all the advantages of the service he is providing. In this case, it is not right to talk, as often happens, about the tyranny of capital, since even in the most extreme cases its presence can never be more damaging than its absence to the situation of the worker. All that capitalists can do, like the people in the tropics who have an intensity of heat that nature has denied to others or the inventor who holds the secret to an industrial process that is unknown to his fellow-men, is to say to them: “If you wish to make use of my efforts, this is my price; if you find it too high, do as you have done in the past and do without it.”

However, competition intervenes among the capitalists. Tools, materials, and provisions succeed in creating useful things only if they are used. Therefore there is rivalry[931] among the capitalists to find a use for their capital. The extent to which this rivalry forces them to reduce their extreme demands, whose limits I have just set out, thus resulting in a reduction of the price, is therefore a net profit, a gratuitous gain for consumers and therefore for the human race!

In this instance, it is clear that something which is free of cost can never be absolute; since all capital represents past efforts made, it always contains with it the principle that a payment will be made.[932]

[rewritten section for EH version]

The transactions relating to capital are subject to the universal law governing exchange, which is accomplished only because there is an advantage for both parties in exchanging, even though this advantage, which tends to level out, sometimes accidentally proves to be greater for one than for the other. There is a limit to the return on capital beyond which nobody would borrow it any longer; this limit is zero service for the borrower. In the same way, there is a limit below which nobody would lend, and this limit is zero return for the lender. This is self-evident. If the claims of one of the parties reach the level of reducing the advantage of the other to zero, the loan becomes impossible. The return on capital oscillates between these two extremes, driven toward the upper limit by competition between borrowers and brought back to the lower limit by competition between lenders, so that, through necessity that is hand in hand with justice, this return is high when capital is scarce and low when it is abundant.

Many economists think that the number of borrowers increases more rapidly than capital is able to accumulate, from which it follows that the natural tendency of interest is to rise. The facts decisively support the opposite view, and we see civilization everywhere making the rate for capital decrease. It is said that payment for capital in Rome was 30 or 40 percent; this payment is still 20 percent in Brazil, 10 percent in Algiers, 8 percent in Spain, 6 percent in Italy, 5 percent in Germany, 4 percent in France, 3 percent in England and still less in Holland. Well, all that progress has eliminated in the price of capital and lost to capitalists is not lost to the human race. If interest that started at 40 percent has reached 2, this means that all products will be relieved of 38 parts out of 40 with regard to this element of production costs. They will reach the consumer relieved of this charge to the extent of 19 twentieths. This is a force that, like natural resources and more effective processes, results in abundance, equalization, and a definitive rise in the general level of the human race.

It remains for me to say a few words about the competition within labor itself, a subject that has generated so many sentimental speeches lately.[933] What then? Will an attentive reader not say that this subject has been exhausted? I have shown that, because of competition, people could not for very long receive an abnormally high reward for the contribution made by the forces of nature or because they knew of industrial processes or owned tools that enabled them to harness these forces. This proves that effort tends to be exchanged on the basis of equality, or in other words that value tends to become proportional to labor. This being the case, I do not really see how one can speak of competition between workers and even less how it could make their situation worse, since from this point of view workers are themselves consumers. The working class includes everybody, and it is precisely this great community[934] that in the end gathers the benefits of competition and all the advantages resulting from the successive elimination of previous costs by progress.

The evolution occurs as follows : Services are exchanged for other services or valuable things for other valuable things. When someone (or a class of people) take possession of a natural resources or a process, the claims involved are regulated not on the efforts made but on the efforts they save others. Demands are pushed to the extreme limit without, however, being able to damage anyone’s situation. People put the highest value possible on their services. But gradually, through the effect of competition, this value tends to become proportional to the efforts made until the process is complete at the point where equal effort is exchanged for equal effort, each of them bearing an ever-increasing mass of gratuitous utility for the benefit of the entire community. This being so, it would be a shocking contradiction to say: competition is damaging to workers.

Nevertheless, this is constantly repeated, and people are even completely convinced of it. Why? Because the word worker does not embrace the wider working community,[935] but only a particular class. The community is divided into two. On one side are set all those with capital and who live in whole or in part on past labor, on intellectual work, or on the proceeds of taxation, and on the other all those who have just their labor and wages, in other words, to use a time-honored expression, the proletariat. The relationship between these two classes is weighed up and the question raised as to whether, in the light of this relationship, the competition that exists between them is not harmful to them.

It is said that the situation of the people in this latter class is essentially precarious.[936] Since they get their wages on a day-to-day basis, they also live on a day-to-day basis. In the negotiation which in a free régime precedes any agreement, they cannot wait; they have to find work for tomorrow on whatever terms under pain of death. While this is not strictly true for all of them, it is true for a great many, and this is enough to bring down the entire class, for it is the most oppressed and destitute who capitulate first and establish the general rate of pay. The result of this is that wages tend to move down to the level which is absolutely necessary to survive and that in this situation, the intervention of the slightest increase in competition between the workers is a genuine calamity, for this is not a reduction in well-being for them but the rendering of life itself impossible.

Indeed, there is a lot of truth in this allegation, in fact too much. To deny the suffering and degradation of this class of people who carry out the physical part of the work of production would be to close your eyes to the light. To tell the truth, it is to this deplorable situation of a considerable number of our brethren that what has been rightly called the social problem relates,[937] for while the other classes of society are also prey to much anxiety, suffering, vicissitudes, crises, and economic convulsions, it is nevertheless true to say that freedom would probably be accepted as a solution to the problem if it did not seem to be powerless to cure this painful wound that we call pauperism.

And since it is above all here that the social problem lies, the reader will understand that I cannot deal with it at this time. Would to God that the solution emerges from the book as a whole, but obviously it cannot emerge from one chapter.

I will now set out general laws that I believe to be harmonious, and I am confident that the reader also will begin to guess at the existence of these laws, that they act in favor of the community and consequently of equality. However, I have not denied that the action of these laws has been profoundly disrupted by disturbing factors.[938] Therefore, if we now find some shocking example of inequality, how can we judge it without being conversant with both the normal laws (governing) the social order and the disturbing factors (which disrupt) these laws?

On the other hand, I have denied neither evil nor its purposes. I believed I could say that, since free will had been given to man, the word harmony should not be reserved for an entity from which misfortune is excluded, for free will implies error, at least as a possibility, and error is evil. Social harmony, like everything that concerns man, is relative. Evil is one of its necessary cog wheels (of the social mechanism),[939] intended to overcome error, ignorance, and injustice by putting into play two great laws of our nature: (individual) responsibility and (human) solidarity.[940]

Pauperism being a given, should it be attributed to the natural laws that govern the social order or instead to the human institutions that act contrary to these laws, or even to the very people who are its victims and who have brought down on their heads this severe punishment of their errors and faults?

In other words, does pauperism exist by providential design, or on the contrary because of what still remains that is artificial in our political system, or is it personal retribution? Fate, injustice, or our individual responsibility: to which of these three causes ought we to attribute this dreadful wound?

I have no fear in saying that it cannot result from the natural laws that we have been studying up to now, since all of these laws tend to the equalisation (of conditions) by means of improvement, that is to say, that they bring people closer to the same level, which is constantly rising. But now is not the time to go deeper in the problem of poverty.

At this time, if we wish to consider separately this class of workers who carry out, without a personal stake in the venture, the most physical part of production and live on a fixed payment known as a wage, the question that we would have to ask ourselves is this: apart from good or bad economic institutions and the harms that the proletariat may encounter through their own fault, what is the effect of competition on them?

For this class, as for all, the effect of competition is two-fold. They feel it as both the buyers and sellers of services. The mistake made by all those who write on these matters is only ever to see one side of the problem, like physicists who, because they only know about centrifugal force, constantly believe and prophesy that all is lost. Give them some false information and you will see with what irreproachable logic they will lead you to their dire conclusion. This is true for the lamentations based by socialists on exclusive observation of centrifugal competition, if I may put it this way; they forget to take account of centripetal competition and that is enough to reduce their doctrines to childish oratory.[941] They forget that when workers come on to the market with the wages they have earned, they are at the centre where countless industries converge, and (can) (then) benefit from the universal competition of which they all complain in turn.

It is true that when they consider themselves producers or suppliers of work or services, the proletariat also complain about competition. Let us assume therefore that it benefits them on one hand and harms them on the other. What we need to know is whether on the whole competition is beneficial or detrimental to the proletariat or whether it balances out.

I would have explained myself very badly if the reader failed to understand that in this marvelous mechanism, the interplay of these different kinds of competition which appear (on the surface) to be antagonistic[942] result in this important and reassuring conclusion that there is a balance which is favourable to everybody at the same time, because gratuitous utility constantly increases the sphere of production and (then) falls into the domain of the Commons.[943] Well, what becomes common to all is of benefit to all without damaging anyone. It may even be said, and this is a mathematical truth, that it benefits each person in proportion to his previous level of poverty. It is this portion of gratuitous utility, which is forced by competition to become common, that ensures that the value (of things) tends to become proportional to labor, which obviously benefits the workers. It is also this portion that explains the solution to the social problem that I constantly keep before the reader’s eyes, and which only the illusions of habit alone are capable of shrouding. For a given quantity of work each person receives a quantity of satisfaction that tends to increase and become equal.

What is more, the condition of workers is not the result of one economic law, but of all of them. To know what their condition is, (to) discover (the possibilities opened up by these laws), (and thus know their) future, this is political economy in a nutshell; because from the point of view of economic science can there be anything else other than workers?… Oh, I am wrong, there are plunderers as well. What establishes the equivalence of services? Freedom. What weakens the equivalence of services? Oppression. This is the cycle we will have to examine.[944]

As for the fate of the class of workers who do the most urgent work of production, this can be appreciated only when we are in a position to know how the law of competition works in conjunction with the laws governing wages and population,[945] and also with the disturbing effects of unequal taxes and monopolies.

I will add just a few more words on competition. It is very clear that reducing the mass of satisfaction that is spread among people is a result foreign to its nature. Does this distribution increase inequality? If there is anything obvious in this world, if I may express it thus, it is that once a greater proportion of utility has been attached to each service or value, competition works constantly to level these services themselves and to make them proportional to effort. Is it not, indeed, the spur that pushes people into fruitful careers and away from fruitless ones? Its very action is therefore to achieve increasing equality while raising the level of society.

Let us, however, agree on what we mean by equality. It does not imply identical levels of pay for everybody, but pay that is proportional to the quantity and even the quality of their efforts.[946]

[end of rewritten section for EH version]

A host of circumstances contributes to making the remuneration for labor unequal (here I am referring only to labor that is free and subject to competition). If you examine it closely, you see that this alleged inequality is almost always just and necessary, and is in fact nothing other than genuine equality.

All other things being equal,[947] moreover, there is more profit in dangerous projects than in ones that are not, in trades that require long apprenticeships, and outlays that are unproductive for long periods of time, which assumes the long-term exercise within the family of certain virtues, than in trades where physical strength is all that is needed, or in occupations that require development of the mind and give rise to refined tastes than in those that just require manual labor. Is all this not just? Well, competition of necessity establishes these distinctions; society does not need a Fourier[948] or a father-figure like Blanc[949] to decide this.

Among these circumstances, the one that has the most general effect is inequality of education. Here, as elsewhere, we see competition exercising its twin effect of leveling classes and raising the level of society.

If you think of society as being composed of two superimposed strata,[950] in one of which the principle of the mind is foremost and in the other brute force; and if you examine the natural relationship between these two social strata, you can clearly see a force of attraction in the first and a force of aspiration in the second which contribute to their merging. The very inequality of profit generates an inextinguishable desire in the lower stratum to reach the region of well-being and leisure, and this desire is supported by the influence of the enlightenment that illuminates the upper classes. The methods of teaching are improved, the price of books is decreasing, education is acquired in less time and at less cost, science, monopolized by one class and even one caste[951] and obfuscated by a language that is dead or embedded in hieroglyphic script,[952] is now written and printed in the common tongue and penetrates, so to speak, the atmosphere and is breathed in like air.

But that is not all. At the same time as a more universal and egalitarian form of education is drawing the two social strata together, weighty economic phenomena linked to the great law of competition are accelerating their fusion. Progress in engineering is constantly reducing the part played by manual labor. The division of labor that simplifies and isolates each productive operation, makes trades originally manageable only by a few, open to all. There is more: a group of tasks that originally assumed a wide range of knowledge has, through the mere passage of centuries, become routine in the area of activity of the least educated classes; this is what has happened to farming. Agricultural processes, which in antiquity gained those who revealed them to the world the highest of honors, are now the heritage and almost completely dominated by the commonest of men, to such an extent that this very important area of human activity is, so to speak, entirely removed from the well-educated classes.

From what has gone before, one may draw a false conclusion and say: “We can clearly see that competition decreases pay in all countries, in all kinds of careers, in all ranks, and levels them downwards, but in this case it is the wages for manual labor that will become the type and standard for all wages.”

I will not have been understood if people do not see that competition, which works to reduce all excessive pay to an average that is increasingly uniform, is bound to raise this average. I agree that this upsets people in their capacity as producers,[953] but this is in order to improve the general situation of the human race in the only form reasonably able to improve it, that of well-being, prosperity, leisure, and intellectual and moral advancement, in a word, from the point of view of consumption.

Will it be said that in the event the human race has not made the progress that this theory appears to imply?

My first response is that, in modern societies, competition is far from fulfilling its natural role; our laws hinder it at least as much as they favor it, and when the question is put as to whether the inequality of the situation of individuals is due to its presence or absence, we have only to see which men are at the top of the pile and can dazzle us with the glamour of their scandalous wealth, to be convinced that inequality, in so far as it is artificial and unjust, is based upon conquest, monopolies, trade restrictions, privileged positions, high government posts and influence, the trafficking in administrative deals, and loans from public funds; all things that have no connection with competition.

Subsequently, I believe that people fail to realize the genuine progress that the human race has made since the very recent period when the partial emancipation of labour began to take place. It has been said, and rightly so, that a great deal of philosophizing was needed to identify the facts that are constantly being witnessed.[954] What a respectable and hard-working family of the working class consumes does not surprise us, because habit has accustomed us to this strange phenomenon. If, however, we were to compare the well-being this family has achieved with the situation that would be its lot under a social order in which competition was excluded, if statisticians, armed with accurate instruments, were able to measure as though with a dynamometer the relationship between the work of this family and the composition of its consumption at two different periods,[955] we would recognize that freedom, as restricted as it still is, has achieved something extraordinary for this family, something whose very duration makes it pass unnoticed. The amount of human effort needed to produce a given result has been drastically cut and is truly incalculable.[956] Today, for five centimes or one fiftieth of his day’s pay he can obtain a newspaper that contains a volume’s worth of material. I could say the same thing for, clothing, travel, transport, lighting, and a host of consumer satisfactions. To what is this result due? To the fact that a huge proportion of paid human labor has been handed over to the free forces of nature. This is economic value that has been eliminated, and so does not require payment. It has been replaced, because of competition, by utility common to all and free of charge. And it should be clearly noted that when the price of any object is decreased as a result of progress, the effort saved by poor buyers in order to acquire it is always proportionally greater than that saved by rich ones. That is a mathematical fact.

Finally, that ever-increasing flow of useful things which work generates and which is in turn distributed by competition through all the veins of the social body, is not wholly defined by well-being. Most of it is absorbed in the flood of ever more numerous generations. It results in an increase in population in accordance with laws that are closely connected with the subject under discussion and which will be set out in another chapter.[957]

Let us stop awhile and cast a rapid glance over the ground we have just covered.

Man has needs that have no limit. He develops desires that are insatiable. To meet them he has materials and forces which are supplied to him by nature, capabilities, and tools, and all the things that labor produces. Labor is the resource that has been the most equally shared out among all; each person instinctively and inevitably seeks to join to it as much of the forces of nature, as much innate or acquired capability, and as much capital as possible, so that the result of all this co-operation is as many useful things produced as possible, or what amounts to the same, as much satisfaction achieved as possible. Thus the ever-increasing contribution made by the forces of nature, the indefinite development of knowledge, and the gradual increase in capital produce this phenomenon, strange at first sight, that a given quantity of labor supplies an ever-increasing sum of useful things and that each person may, without depriving anyone else, achieve a mass of consumption out of all proportion to what his own efforts could produce.

But this phenomenon, the result of the divine harmony that Providence has spread throughout the mechanism of society, would have turned against society itself by planting in it the seed of endless inequality, if it were not combined with another kind of harmony no less admirable, namely competition, which is one of the branches of the great law of human solidarity.[958]

Indeed, if it were possible for an individual, a family, a classe, or a nation that found themselves within reach of certain natural advantages, which had made an important industrial discovery, or acquired the tools of production through saving, to be cut off permanently from the law of of competition, if such a thing were possible, I repeat, it is clear that this individual, this family, or nation would be in permanent possession of a monopoly of extraordinary remuneration at the expense of the human race. Where would we be if the inhabitants of the equatorial regions, freed from any competition with each other, were able, in exchange for their sugar, coffee, cotton, or spices, to demand from us, not repayment in the form of an effort equal to theirs, but an effort equal to that which we would have had to take ourselves to produce these things in our harsh climate? What incalculable distance would separate the diverse situations of people if the race of Cadmus[959] were the only one that knew how to read, if nobody was allowed to use a plow unless he could prove that he descended directly from Triptolemus,[960] if the descendants of Gutenberg[961] were the only ones allowed to print, the sons of Arkwright[962] to use a spinning jenny, or the nephews of Watt[963] to get the chimney of a locomotive smoking! However, Providence did not will this to be so. It placed within the social machine a spring, such that nothing is more astonishing than its power, except perhaps its simplicity. Through the operation of this spring, any productive force, any superiority of industrial process in short any advantage not due to his own labor, slips through the fingers[964] of the producer, stops there in the form of exceptional reward just long enough to arouse his enthusiasm and after a while goes on to enlarge the common and free heritage of the human race before finally issuing an ever-growing quantity of individual satisfaction constantly being shared more equally. This spring is competition. We have seen its economic effects; all that remains for us to do is to cast a rapid glance over a few of its political and moral consequences. I will limit myself to indicating the most important of these.

Some superficial minds have accused competition of introducing antagonism among men. This is true and inevitable as long as men are considered only in their capacity as producers; if you take the point of view of consumption, you will see that competition itself draws individuals, families, classes, nations, and races together through the bonds of universal brotherhood.[965]

Since goods that at first sight appear to be the privilege of the few become, through an admirable decree of divine beneficence, a heritage common to all; since the natural advantages of location, fertility, temperature, mineral wealth, and even industrial aptitude, seem just to slip through the hands of the producers,[966] given the competition which they enter into with each other, and turn exclusively to the advantage of consumers, it follows that there is no country that does not have a stake in the progress of all the others. Every progress achieved in the East is wealth in prospect for the West. If fuel is discovered in the South, the people of the North are warmed. Great Britain can make all the progress she likes with her spinning mills; her capitalists will not reap the benefit, for the interest on their money does not increase. The benefit does not go to her workers since their earnings remain the same, but in the long run it is Russia, France, Spain - in a word the human race - which gets the same satisfactions with less effort or, which amounts to the same thing, greater satisfaction for the same effort.

I have spoken only of benefits, but I could have said as much about the harms, that afflict certain nations or regions. The very nature of competition is to make general that which was once particular. It acts precisely on the principle of insurance. If a plague ravages farmland, it is those who eat bread who suffer. If an unjust tax is levied on French vines, it results in expensive wine for drinkers the world over; thus benefits and harms of the long-lasting kind just slip through the hands[967] of individuals, classes, and nations.[968] Their providential destiny is to affect the entire human race in the long run and improve or worsen its situation. This being so, to envy a particular nation for the fertility of its soil, the beauty of its ports or rivers, or the warmth of its sun is to fail to recognize the advantages in which we are all destined to have our share. It is to reject the abundance[969] offered to us and to miss the toil we have been spared. This being so, national jealousies are not just perverse sentiments, they are sentiments that are absurd into the bargain. To harm others is to harm yourself. To place obstacles in the path of others,[970] whether these are customs tariffs, foreign alliances, or wars, is to obstruct your own path. Consequently, harmful passions are punished, just as generous ones are rewarded. The inevitable sanction of accurate, distributive justice appeals to one’s self-interest, enlightens public opinion, and in the end proclaims and secures the upholding by people of the eternally true maxim: The useful is only one aspect of the just, liberty is the most beautiful of the social harmonies, and justice is the best policy.

Christianity introduced the great principle of human brotherhood to the world. It spoke to the heart, the emotions, and the instincts that were noble. Political economy seeks to have the same principle prevail in cold reasoning and, by showing the link between cause and effect, reconciles the calculations of the most attentive self-interest with the inspiration of the most sublime morality in one reassuring agreement.

A second consequence of this doctrine is that society is a genuine community. Messrs. Owen and Cabet[971] may save themselves the trouble of looking for a solution to the great problem of communism; it has already been found. It results not from their despotic schemes but from the organization that God has given to man and society. Natural forces, more efficient industrial processes, and tools of production, all these are commonly available to man or are tending to become so. This is true for everything, except for the trouble people incur, and the labor and individual effort put in. Between men there is only one and there can be only one inequality, one that the most dyed in the wool communists acknowledge, and that is the inequality that results from the inequality of effort. These are the efforts exchanged between people for a freely negotiated price. All the utility that nature, the genius of past centuries, and human foresight have imparted to the products being exchanged is therefore available into the bargain. Reciprocal payment relates only to their respective efforts, either present effort in the form of labor or preparatory effort in the shape of capital. (This) is therefore a community in the strictest sense of the word, unless you wish to claim that each person’s share in the satisfaction has to be equal, while the share of effort exerted is not. This would indeed be the most unjust and monstrous of inequalities and, I would add, the most disastrous, for it would not kill competition but merely cause its action to be inverted. People would still fight, but they would fight[972] to excel in laziness, lack of intelligence, and lack of foresight.

Finally, the doctrine that we have developed, so simple and, we are convinced, so true, forces the emergence of the great principle of human perfectibility out of the domain of oratory and into that of rigorous proof. From this internal motive, which never rests in a person’s breast and which leads that person to improve his or her situation, is born the advance of technology, an advance that is nothing other than the gradual cooperation of forces, which by their very nature are unconcerned with any remuneration. Competition gives rise to the granting to the community those benefits which were originally acquired by individuals. The intensity of the effort required for any given result is constantly reduced for the benefit of the human race, which sees its range of satisfactions and leisure increase from one generation to another and the level of its physical, intellectual, and moral progress advance, and through this arrangement, so worthy of our study and eternal admiration, we clearly see the human race rising up out of its degradation.

I hope my words will not be misunderstood. I am not saying that all brotherhood, all community, and all human perfectibility are contained in competition itself. What I am saying is that it is linked and allied to these three great social social concepts, that it is part of them, that it makes them manifest, and that it is one of the most powerful agents of their sublime realization.

I have concentrated on describing the general and consequently beneficial effects of competition, for it would be sacrilege to suppose that any great law of nature could produce effects that were both harmful and permanent, but I am far from denying that its action can be accompanied by a great deal of hardship and suffering. I even consider that the theory that has just been set out, explains both these sufferings and the inevitable complaints they generate. Since the work of competition is to level out, of necessity it is bound to upset anyone who raises his proud head above this level. We can understand that each producer strives to retain the exclusive use of a resource, an industrial process, or a tool of production for as long as possible in order to keep the highest price for his work. Well, since the purpose as well as the result of competition is precisely to remove this exclusive use from individuals in order to make it common property, it is inevitable that men, insofar as they are producers, will unite in a chorus of curses against competition.[973] They can become reconciled to it, only by appreciating their relationship to consumption, by thinking of themselves not as members of a clique or a privileged corporation, but as individual men.

It has to be said that political economy has not done enough to dispel this disastrous illusion,[974] which is the source of so much hatred and resentment, and so many disasters and wars. It has worn itself out, given its very unscientific orientation, analyzing the phenomena of production; even its nomenclature, as convenient as it is, is not in harmony with its subject-matter. Farming, manufacturing, or commerce are perhaps excellent headings when it is a question of describing the processes involved in these technical arts, but such description, though of vital significance in technology, is scarcely relevant in social economy,[975] and I would actually say that it is essentially dangerous in this context. When people have been classified as farmers, manufacturers, and merchants, what can you talk to them about, other than their class interests, those special interests that conflict with competition and oppose the general good? It is not for farmers that farming exists, for manufacturers that there are factories, or for merchants that exchanges take place, but in order for people to have access to the greatest possible number of products of all kinds. The laws of consumption, and what promotes it, equalizes it, and makes it moral: that is the true social and humanitarian interest; that is the real focus of economic science; that is on what it should focus its sharpest thinking.[976] For this is where the bond between classes, nations, and races is - the principle and the explanation of human brotherhood. It is therefore with regret that we see economists devoting their powerful minds and dispensing a prodigious wealth of wisdom, in pursuit of the anatomy of production, relegating to appendices at the ends of their books a few brief commonplaces on the phenomena of consumption. What is that I am saying? Not long ago, we saw a justifiably famous professor[977] suppressing this part of economic science totally and devoting himself to the means without ever mentioning the ends, and banishing from his lectures anything relating to the consumption of wealth as belonging, so he said, to the realm of moral philosophy and not to political economy. Should we be surprised that the general public are more struck by the disadvantages of competition than its advantages, since the disadvantages affect it from the particular point of view of production, about which they are constantly being informed, and the advantages from the general point of view of consumption, about which they are never told anything?

What is more, and I repeat and do not deny it, I clearly recognize and deplore as much as others do, the pain that competition inflicts on people, but is this a reason to close one’s eyes to the good it does? This good, which I believe competition to be, is indestructible like all the great laws of nature. And how consoling it is to note this fact! If competition could die, it would doubtless have succumbed to the universal resistance of all the men who have ever contributed to the creation of a product since the dawn of time, and especially to the national call to arms which all the modern reformers have promoted. But although they have been crazy enough, they have not been strong enough to do this.

And what progressive principle has there been in the world whose beneficial action has not been mixed up with a great deal of pain and misery, especially at the beginning? The great urban centers created by human beings have encouraged the flourishing of thought, but they often shield private life from the corrective of public opinion and act as a shelter to debauchery and crime. Wealth allied with leisure generates the life of the mind, but it also generates ostentation and arrogance in the great, and resentment and envy in the lowly. Printing shines enlightenment and truth on all the social stratas of society, but it also conveys painful doubt and subversive error. Political freedom has unleashed enough storms and revolutions around the planet, it has modified the simple and naïve habits of primitive nations profoundly enough for serious minds to have asked themselves the question as to whether they did not prefer peace in the shadow of despotism. And Christianity itself has scattered the great seed of love and charity on land soaked with the blood of martyrs.

How has it become part of the plans of infinite goodness and justice that the good fortune of one region or century is bought by the suffering of another region or century? What divine thought is hidden under this great and indisputable law of human solidarity of which competition is just one of its mysterious aspects? Human science does not know this. What it does know is that good is constantly expanding and evil constantly shrinking. From the very beginning of the social order, an order created out of conquest, where there were only masters and slaves and in which inequality of condition was extreme, competition was not able to do its work of drawing men of different ranks, fortunes, or minds closer together, without inflicting some individual hardship, the intensity of which constantly lessens as the work progresses, much like the vibrations of sound and the swings of a pendulum gradually diminish over time. To the suffering that is still inflicted, the human race learns daily to apply two powerful remedies, foresight, the fruit of experience and enlightenment, and association, which is organized foresight.[978]

 


 

Conclusion of the 1st Edition of the Harmonies)

In this, alas, too hastily (written) first part of the work that I am submitting to the general public,[979] I have endeavored to concentrate its attention on the constantly shifting but always distinct line of demarcation that separates the two regions of the world of economics:[980] the collaboration of nature and human labour, the bounty of God and the work of man, that which is gratuitous and that which is onerous, that which is paid for in an exchange and what is given up without payment, total utility and the partial and additional utility that constitutes value, absolute (amount of) wealth and relative (amount of) wealth, the contribution made by chemical and mechanical forces forced to assist production by the tools that control them, and the just pay owed to the labor that created these tools themselves, and what is common to all and private property.

It was not enough to point out these two orders of phenomena so essentially different in nature, their relationship also had to be described together with, if I may express it thus, their harmonious evolution. I have tried to explain how the work of private property consisted in conquering utility for the human race, throwing it into the common domain in order to fly off to new conquests, so that each given effort and consequently the collection of (all) efforts, constantly provides the human race with the enjoyment of an ever-increasing number of satisfactions. This is what constitutes progress, and the human services exchanged, while retaining their relative value, act as a vehicle for a constantly greater proportion of gratuitous utility (which) as a result (becomes) common to all. Far from the owners of things of value in whatever form, usurping and monopolizing the gifts of God, they multiply them without making them lose that bounty that Providence intended them to have: (namely,) gratuitousness.

As the (number of) satisfactions paid for by nature as a result of progress, thus fall into the common domain, they become equal, since inequality can be conceived only within the domain of human services which can be compared with each, assessed, and evaluated in order to be exchanged. From which it results that equality among men is necessarily progressive. It is also progressive from another point of view, since the action of competition has the inevitable result of evening/levelling out the services themselves and making their remuneration increasingly correspond to their merit.

Let us now look at at the areas we still have to cover.

In the light of the theory whose foundations have been outlined in this volume, we will have to go into more deeply (the following):

The relationships between people, considered as both producers and consumers,[981] with the following economic phenomena:

The law of land rents,[982]

The law of wages,[983]

The law of credit,[984]

The law of taxation,[985] which, by leading us us into government policy itself, will lead us to compare private and voluntary services with public and coerced ones.[986]

The law of population.[987]

We will then be in a position to solve some of the practical problems that are still disputed: (such as) commercial freedom,[988] machines,[989] luxury,[990] leisure,[991] association, the organization of work,[992] etc.

I am not afraid to say that the result of this survey may be expressed in advance in these words: there is a steady approach by all men and women towards a standard of living which is always increasing,[993] in other words, improvement [994] and equalization, or in a single word, HARMONY.

This is the end result of the plans of Providence, of the great laws of nature, when they (are able to) rule without obstacles (being placed in their way), when they are considered in their own right, and setting aside the disorder to which error and violence subject their operation.[995] When they see this harmony, economists may well exclaim, as astronomers do when they view the spectacle of the movement of the planets or physiologists when contemplating the organization of human organs: Digitus Dei est hic! (Here (we see) the hand of God (at work))

But man is a free spirit, and consequently fallible. He is prey to ignorance and passion. His will, (which) can be mistaken, enters as one of the elements in the play of economic laws. He may misunderstand them, ignore them, (or) deflect them from their purpose. Just as physiologists, once they have admired the infinite wisdom which is demonstrated in each of our organs and viscera, along with their interrelationships, also study these organs in their abnormal state, when they are ailing and painful, we will also have to enter into a new world, that of the world of social disturbances.[996]

We will prepare ourselves for this new study by considering man himself a little. It will be impossible for us to account for this social disease, its origin, effects, purpose, and the ever increasing restrictions with which it binds itself through its own action (which constitutes what I am bold enough to call a “harmonious disharmony”)[997] if we did not extend our examination to the necessary consequences of free will, the excesses of (the pursuit of) self interest that are always punished, and the great laws of (individual) responsibility and human solidarity.[998]

We have seen the seeds of (all) the social harmonies[999] encapsulated in the following two principles: PROPERTY and FREEDOM. We will see that all social disharmony is merely the development of two other principles that conflict with the first: PLUNDER and OPPRESSION.

And likewise the words “property” and “freedom” express only two aspects of the same idea. From the point of view of economics, freedom relates to the act of producing and property to the things which have been produced. And since value owes its very reason for existing in human action[1000], it may be said that freedom implies and encompasses property. This is also true of oppression with regard to plunder.

Freedom! This, in the final analysis, is the principle of harmony. Oppression! This is the principle of disharmony, and the struggle between these two forces fills the annals of the human race.

And since the aim of oppression is to achieve (an) unjust appropriation (of property), since it turns into and (ultimately) comes down to plunder, it is plunder that I will put on centre stage.[1001]

Man arrives on this earth tied to the yoke of need, which is pain.

He can escape only by subjecting himself to the yoke of work, which is (more) pain.

He therefore must choose between two kinds of suffering, and he hates suffering.

For this reason he looks around him, and if he sees that his fellow man has accumulated (some) wealth, he conceives the idea of appropriating it. From this we get “counterfeit” property[1002] or plunder.

Plunder! This is a new element in the economy of societies.

From the day it first appeared in the world to the day, if ever that should arrive, when it will have completely disappeared,[1003] this element will profoundly affect the entire social mechanism.[1004] It will disrupt the (operation of the) harmonious laws that we have endeavored to discover and describe, to the (point) of making them unrecognizable.

Our task will therefore be completed only when we have written a detailed monograph on plunder.

Perhaps some (people) will think that it (plunder) is an accidental and abnormal event, a fleeting wound (which is) unworthy of scientific investigation.

But be careful. In the traditions of (some) families, in the history of nations, in the lives of individuals, in the physical and intellectual activities of classes, in the organization of society, or in the plans of governments, plunder plays nearly as large a part as property itself.

Oh no! Plunder is not a passing scourge, which accidentally affects the social mechanism and can be disregarded by economic science.

This decree was pronounced on man from the outset: “By the sweat of thy brow shalt thou eat bread.”[1005] This would appear to say that effort and satisfaction are indissolubly linked and that the latter cannot be anything other than the reward for the former. However, we see men revolting against this law everywhere and saying to their brethren: “You do the work, I will take the fruit of (that) work.”

Go into the hut of a primitive hunter or into the tent of a nomadic shepherd. What will you see there? His wife, who is scrawny, disfigured, terrified, and prematurely wrinkled, bears the entire weight of domestic work while her husband whiles away his time in idleness. What idea of familial harmony might we conclude from this? There is none, because the strong has thrown upon the weak the (full) weight of the fatigue (of work). And how many centuries of civilized development are needed before women are relieved of this terrible degradation?[1006]

Plunder in its most brutal form, armed with fire and the sword, has filled the annals of the human race. What are the names that epitomize its history? Cyrus, Sesostris, Alexander, Scipio, Caesar, Attila, Tamberlane, Mohammed, Pizarro, and William the Conqueror.[1007] (Here) is naked plunder by means of conquest. To them go the laurels, the monuments, the statues, the triumphal arches, the songs of poets, and the intoxicating enthusiasm of women!

The conquerors soon realized that there was something better to do with the people they conquered than killing them, and slavery became (a) worldwide (phenomenon). Almost to the present time, right around the planet, slavery has been the mode of existence of (entire) societies, sowing in its wake hatred, resistance, internecine conflict, and revolutions. And is slavery anything other than organized oppression with a view to plunder?

If plunder arms the strong against the weak, it no less turns the intelligent against the credulous. What industrious nations around the world have escaped the exploitation of priestly theocracies,[1008] the Egyptian priests, Greek oracles, Roman auguries, Gallic druids, Indian Brahmins, muftis, ulemas, bonzes, monks, ministers, jugglers, sorcerers, fortune tellers, plunderers in all religious costumes and of all creeds? In this guise the genius of plunder (is to) locate its main locus of support in heaven (itself) and claim sacrilegiously the complicity of God! This not only enchains people’s hands but also their minds. It knows how to (place the branding iron of servitude) as firmly on the conscience of Seide[1009] as on the brow of Spartacus,[1010] achieving what might be thought unachievable: namely, mental slavery.

Mental slavery! What a frightful association of words! O Freedom! We have seen you hounded from place to place, crushed by conquest, in your death throes under slavery, insulted in the courts, expelled from schools, mocked in salons, misunderstood in workshops, and cursed in places of worship. You ought to have been able to find an inviolable refuge in thought. But if you succumb in this sanctuary, what will become of the hope of centuries and the value of human nature?

In the long term (as the progressive nature of man would have it), plunder encourages the growth of (acts) of resistance that paralyze its strength [1011] and enlightened (ideas) which strip the veil from its deception in the very environment in which it operates. It does not give up for all that; it merely becomes more cunning. By wrapping itself in different forms of government, by moderating and balancing its behaviour, it gives birth to politics, a (productive) mine (which it has exploited) for a long time. It is then seen to usurp the freedom of citizens in order to better exploit and exhaust their wealth, and to better bring an end to their freedom. Private activity moves into the domain of public activity. Everything is done by state functionaries; an unintelligent and interfering bureaucracy covers the country.[1012] The public treasury becomes a huge reservoir into which workers pour their savings, which are then shared out among those with government positions. Free negotiation is no longer the rule for (economic) transactions and, (without this) nothing can be done to undertake or confirm the mutual exchange of services.

In this state of affairs, the true notion of property dies out, with each person appealing to the law to give their services an artificial value.[1013]

We thus enter the era of privilege. Plunder, ever more subtle, is enshrined in monopolies and hidden behind (trade) restrictions. It displaces the natural flow of exchanges,[1014] it drives capital in artificial directions, (and) with capital, (goes) labor, and with labor, (goes) the population itself. It makes the north produce with difficulty what the south would produce with ease. It creates precarious industries and livelihoods (dependent on these industries). It substitutes the onerous fatigue of work for the gratuitous forces of nature. It encourages the establishment of businesses that cannot stand up to any rivals, and invokes the use of force against their competitors. It triggers international jealousy, flatters patriotic pride, and invents ingenious theories that use its own dupes as (unwitting) allies.[1015] It creates crises in production and bankruptcies which are always immanent. It undermines all the citizens’ confidence in the future, all faith in freedom, and even the(ir) understanding of what is just. And when economic science at last strips the veil over its misdeeds, it whips up its victims against (economic) science by exclaiming: “(On to) Utopia!” What is worse, it denies not only the (economic) science that bars its path but the very idea that economic science is possible, through this final skeptical sentence: There are no (economic) principles![1016]

Nevertheless, spurred on by suffering, the mass of workers rises up and overturns everything that is above it.[1017] Government, taxes, and legislation, all are at its mercy, and perhaps you will think that that is the end of the reign of plunder. You believe that the mutuality of services will be established on the only basis possible or even imaginable, (that is) freedom. Alas! You are mistaken. That disastrous idea[1018] has infiltrated down into the masses, that property has no other origin, sanction, legitimacy, or raison d’être than the law, and here we have the masses beginning to plunder themselves through the law.[1019] Suffering from the wounds inflicted on it, it endeavors to cure each of its members by giving it a right of oppression over the member next to it. That is called solidarity and fraternity.[1020] “You have produced something but I have not; as we are linked by solidarity, let us share.” “You have something and I have nothing; as we are brothers, let us share.” We will therefore have to examine the abuse of the words “association,” “organization of work,” “free credit,” etc. that has been carried out lately. We will have to subject them to the following test: do they contain (the idea) of freedom or of oppression? In other words, do they conform to the great economic laws or are they a disturbance of these laws?

Plunder is all too universal a phenomenon, one (which is) too persistent for a purely accidental character to be able to be attributed to it. In this matter, as in many others, the study of natural laws cannot be separated from the disturbance in their operation.

But, it will be said, if plunder unavoidably enters into the working of the social mechanism as disharmony, how can you claim that there is harmony in the laws of economics?

I will repeat here what I have said elsewhere: in everything that concerns man, this being who is perfectible only because he is imperfect, harmony does not consist in the absolute absence of evil, but in its gradual reduction. The social body, like the human one, is provided with a curative force, a vis medicatrix,[1021] whose laws and infallible power cannot be studied without the cry still being uttered: “Digitus Dei est hic.” (Here is the hand of God)[1022]

Bios of Conquerors

Cyrus II of Persia, “Cyrus the Great”, (600–530 BCE) founded the Achaemenid or First Persia Empire which encompassed the states of the ancient Near East and much of western and central Asia.

Sesostris was a king of ancient Egypt who, according to Herodotus invaded Asia Minor before crossing into Europe, where he defeated the Scythians and Thracians in what today is Romania and Bulgaria.

Alexander III of Macedon, or Alexander “the Great”, (356-323 BCE) was king of Macedonia and created one of the largest empires which stretched from Greece to northwestern India.

Publius Cornelius Scipio Africanus (236–183 BCE) was a Roman general who defeated Hannibal during the Second Punic War and conquered Carthaginian controlled Iberia.

Julius Caesar (100-44 BCE) was a Roman politician, military general, and historian who played a critical role the end of the Roman Republic and the rise of the Roman Empire. He became Dictator of Rome and his adopted grand-nephew Octavian became the first Roman Emperor after Caesar’s assassination.

Attila “the Hun” (406–453) ruled an empire of tribal Huns, Ostrogoths, and Alans in Central and Eastern Europe, which threatened both the Roman and Eastern Empires. He invade the Balkans, France, and northern Italy.

Timur (1336-1405), or “Tamerlane,” was a Turco-Mongol conqueror who founded the Timurid Empire in Persia and Central Asia, waging military campaigns across Western, South, and Central Asia, the Caucasus and southern Russia, eventually defeating the Mamluks of Egypt and Syria.

Mohammed (570-632). As a military commander later in his life (622-32) Mohammed was able to seize control of Mecca and then conquer the various tribes which inhabited the Arabian peninsula uniting it under his control.

Francisco Pizarro González (1471-1541) was a Spanish conquistador who conquered the Inca Empire in a series of military expeditions between 1524 and 1529.

William I (1087-1087), Duke of Normandy, led an invasion of England in 1066 of which he became King (“William the Conqueror”) and ruled between 1066 until his death in 1087.

 


 

3. Economic Harmonies (2nd 1851 ed.)

List of Chapters intended to complete the Economic Harmonies

Editor’s Introduction

The first edition of the Harmonies was published in January 1850. Then Bastiat became sicker and had to take a leave from the Assembly and retire to Les Landes. In spite of his illness, but perhaps thanks to the calm that it required, the following months were to be very prolific: between February and September he wrote several of his masterpieces such as The Law. He also worked on a new, much enriched edition of the Harmonies, but could not finish it.

For the 1862 edition[1023], Paillottet used whatever manuscripts he found to add to the first ten chapters. At this point in the said edition, he wrote the following note :

"We reproduce this handwritten list by the author here. It indicates the work he planned and at the same time the order we have followed in classifying the chapters, fragments and rough drafts in our possession. The asterisks designate the subjects on which we have not found any work started."

List of Planned Chapters

NORMAL PHENOMENA

1.  Producer - Consumer

2.  The two mottoes

3.  The theory of Rent

4.  * On money

5.  * On credit

6.  On salaries

7.  On savings

8.  On population

9.  Private services, public services

10.  * On taxes

COROLLARIES

11.  * On machines

12.  * Freedom of exchange

13.  * On intermediaries

14.  * Raw materials - finished products

15.  * On luxury

DISRUPTING PHENOMENA

16.  Plunder

17.  War

18.  * Slavery

19.  * Theocracy

20.  * Monopoly

21.  * Governmental exploitation

22.  * False fraternity or Communism

GENERAL VIEWS

23.  Responsibility - solidarity

24.  Personal interest or the social drive

25.  Perfectibility

26.  * Public opinion

27.  * The relationship between political economy and morality

28.  * and politics

29.  * and legislation

30.  * and religion.

 


 

XI. Producer and Consumer[1024]

If the standard of living of the human race does not increase constantly, man is not perfectible.

If the tendency of society is not the continual approach of all men to this progressively increasing standard of living, the laws of economics are not harmonious.

Well, how can the standard of living of the human race rise if each given quantity of labor does not provide an ever-increasing proportion of satisfaction, a phenomenon that can be explained only by the transformation of onerous utility into gratuitous utility?

And on the other hand, how would the utility that has become gratuitous bring everyone closer to a common standard of living if it did not at the same time become common to all?

This is therefore the essential law of social harmony.

I would very much like the language of economics to supply me with two words other than “production” and “consumption” to designate services which are rendered and received, since these two words are sullied by their materialist connotations. Obviously there are services, such as those provided by priests, teachers, soldiers, or artists, which promote morality, education, security, or an appreciation of beauty, and which have nothing in common with production as routinely understood, other than their goal of (providing) satisfaction.

These terms are now accepted, and I do not want to turn myself into a neologist. But at least let it be fully understood that by production I mean that which bestows utility (on something) and by consumption the enjoyment produced by this utility.

It is to be hoped that the protectionist school, (which I believe is) a variant of communism,[1025] will believe us readily enough. When we use the words producer and consumer, we are not stupid enough to imagine, as protectionism accuses us of doing, that the human race is divided into two clearly separate classes, one whose sole occupation is to produce while the other is concerned only to consume. Naturalists may divide the human race into black and white, men and women, but economists cannot divide it into producers and consumers because, as (our friends) the protectionists say, on the basis of their truly profound views, producers and consumers are one and the same.

It is precisely because they are one and the same, however, that economic science has to consider each person from this double perspective. It is not a question of dividing the human race into two, but of examining two very different aspects of mankind. If protectionists forbade grammar to use the pronouns “I” and “you” on the pretext that each of us is in turn the person spoken to and the person speaking we would call to their attention the fact that, although it is perfectly true that we cannot put all tongues on one side and all ears on the other, since we all have ears and a tongue, it does not follow that, with respect to each proposition uttered, the tongue does not belong to one person and the ears to another. In the same way, with regard to any service, the person who provides it is quite distinct from the one receiving it. The producer and (the) consumer confront each other, so much so that their discussion is always contested.

The same people who do not want to allow us to study human interests under the double aspect of the producer and the consumer are not slow in making this distinction when they speak to legislative assemblies. They are then seen to demand monopoly or (economic) freedom depending on whether it is a question of the things they are selling or those they are buying.

Therefore, without our being ruled out of court, which is what the protectionists are urging, let us acknowledge that in the social order the division of labor has put each person into two situations sufficiently distinct to generate both some interaction and some (inter-)relationships that warrant (further) examination.

In general, we take on a trade, a particular job, or a career, and it is not from this career that we directly demand the objects of our satisfaction. We provide and receive services, we supply and demand things of value, we buy and we sell, we work for others and others work for us; in a word, we are both producers and consumers.

Depending on whether we come to the market in one of these guises or the other, we approach it in a very different, one might even say, quite opposite spirit. With regard to wheat, for example, the same person does not have the same wishes[1026] when he goes to buy something than when he goes to sell something. As a buyer, he hopes for abundance and as a seller, scarcity. These wishes are rooted in the same motive, self-interest, but given that, like buying or selling and giving or receiving, supplying and demanding are acts as opposite as it is possible to be, it is inevitable that, as a result of this same force, they give rise to opposing wishes.

Wishes that clash cannot both coincide with the general good. In another work,[1027] I have sought to show that it is the wishes of men as consumers that are in harmony with the public interest and that the case cannot be otherwise. Since satisfaction is the purpose of labor and since (the amount of) labour is determined by the number of) obstacles (it encounters), it is clear that labor is the harm that everything ought to aim to diminish and satisfaction the good that everything ought to co-operate to increase.

At this point we have the great, eternal, and deplorable illusion that arises from the false definition of value and the confusion that has been made between value and utility.

Since value is just a relationship, it is important for each individual but unimportant for the mass (of mankind).

For the mass (of mankind), only utility is useful, and value is not at all how it is measured.

For each individual, too, only utility is useful. But value is how this is measured, since for each value he has decided upon he withdraws from the social bank[1028] the utility of his choice to the amount of this value.

If one considers a man living in isolation, it would be as clear as daylight that consumption is the essential thing and not production, since consumption implies a certain amount of labor, but labor does not imply consumption.

The division of labor has led certain economists to measure general well-being not by consumption, but by (the amount of) labor. And following their example we have succeeded in this strange overturning of principles: favouring labor at the expense of its results.

The reasoning went as follows:

The more difficulties are overcome the better it is. Therefore let us increase the difficulties to be overcome.

The flaw in this reasoning leaps to the eye.

Yes, doubtless, for a given amount of difficulty, it is a good thing for an equally given amount of labor to overcome it as far as possible. But to diminish the effectiveness of labor or increase the number of difficulties in order to increase the (the amount of) value is monstrous.

The individual (living) in society has an interest in having his services increase in value, even if they retain the same degree of utility. Let us assume that these desires are achieved, and it is easy to see what would happen. He would have more well-being, but his brethren would have less, since total utility has not increased.

We cannot therefore draw conclusions from the particular (case) to the general and say: “Let us (adopt) this measure whose result satisfies the inclination of all individuals to see the value of their services increase.”

Value being a relationship (we would have done nothing if the increase was everywhere in proportion to previous value), if it were arbitrary and unequal for different services, we would simply have introduced injustice into the distribution of utility.

It is in the nature of each transaction to give rise to a negotiation. Good God! What have I just said? Have I not aroused the ire of all the sentimentalist schools of thought that are so numerous these days?[1029] Negotiation implies conflict, they will say. You will therefore agree that conflict is the natural state of society. Here am I, obliged to break yet another lance. In this country, economic science is so little known that it cannot utter a word without bringing an adversary to his feet.

I have been rightly criticised for having written this sentence: “Between the seller and the buyer, there is a fundamental conflict.”[1030] The word conflict, especially when reinforced by the word fundamental, goes (much) further than my intention. It appears to imply a permanent clash of interests, and consequently eternal social disharmony, whereas I merely meant to speak of the brief negotiation that precedes any contract and which is inherent in the very notion of (a) transaction.

As long as there remain the traces of freedom in this world, to the great regret of sentimental utopians, buyers and sellers will discuss their interests, negotiate over their prices and haggle, as it is called, without social laws ceasing to be harmonious for all that. Is it possible to imagine that the person who offers a service and the person who demands a service[1031] will speak to each other without having a moment’s difference in thought with regard to its value? And do people think that this will set the world ablaze? Either you have to banish all forms of transaction, exchange, barter, or freedom from this earth or you have to accept that each party to a contract will defend his position and want to see his position prevail. It is precisely from this free negotiation, so decried, that the equivalence of services and the justice of transactions are established. How will the (would be) organisers of society achieve such desirable justice otherwise? Will they fetter the freedom of just one of the parties through their laws? In that case, this party would be at the mercy of the other. Will they deprive both parties of the ability of settling their interests on the grounds that in future they will have to buy and sell according to the principle of fraternity? Let the socialists allow us to point out, however, that this is nonsense, for in the end these (differing) interests have to be resolved. Will the negotiation take place in reverse, with the buyer taking the side of the seller wholeheartedly and vice versa? You have to admit that the transactions would be very amusing.[1032]

“Sir, pay me 10 francs only for this woolen cloth.”

“What are you saying? I want to give you 20 francs.”

“But Sir, it is worth nothing, it is out of fashion, it will be worn out in two weeks," says the merchant.

“It is hardwearing and will last two winters," replies the customer,

“Well, Sir, just to please you, I will add 5 francs to it, that is all (the principle of) fraternity will allow me to do.”

“It goes against my socialist principles to pay less than 20 francs for it, but you have to know how to make sacrifices and I accept.”

Thus the bizarre transaction will just come to an ordinary result and (our) organisers will regret seeing this damned freedom continue to exist although in an upside down way and generating a reverse form of conflict.

“This is not what we wanted,” say our organizers, “this would be freedom.”

“What do you want, then, for services still have to be exchanged and conditions settled?”

“We want the job of settling them to be left to us.”

“I thought as much …”

Fraternity! The bond between souls, the divine spark that descends from heaven into the hearts of men, has your name been taken in vain just once too often? It is in your name that people aspire to stifle all freedom. It is in your name that people aspire to set up a new despotism, such as the world has never seen, and we may fear that after being the passport to so much ineptitude, the mask for so much ambition, and the plaything for so much proud scorn for human dignity, this sullied name will end up by losing its great and noble meaning.

Let us not then aspire to overturn everything, direct everything, and withdraw everything, whether men or things), from the laws governing their own nature. Let us leave the world as God made it. Let us not imagine, we poor scribblers, that we are anything other than more or less accurate observers. Let us not claim, ridiculously, to be changing the human race as though we were outside it, with (all) its errors and weaknesses. Let us allow producers and consumers to have interests, to discuss them, negotiate over them, and settle them through fair and peaceful agreements. Let us limit ourselves to observing their relationships and the effects (which result from them). This is what I am going to do, always from the point of view of the great law that I maintain is the one that governs human society: the gradual equalization of individuals and classes combined with general progress.

A line no more resembles a force or a velocity than a value or a utility. Nevertheless, mathematicians use lines to (some) advantage. Why should an economist not do likewise?[1033]

There are items of value that are equal, others that have known ratios between them: (such as a) half, a quarter, double, or triple. Nothing stops us from representing these differences by lines of varying lengths.

This is not the case for utility. General utility, as we have seen, is broken down into gratuitous utility and onerous utility, utility due to the action of nature and that due to human labor. The latter being amenable to evaluation and measurement, it can be represented by a line of a determined length; gratuitous utility is not able to be valued or measured. It is certain that nature does a great deal to produce a hectoliter of wheat, a cask of wine, an ox, a kilogram of wool, a barrel of oil, or a cubic meter of wood. But we have no means of measuring the natural contribution of a host of forces, most of which are unknown, and which have been in action since the creation. What is more, we have no interest (in making such measurements). We therefore have to represent gratuitous utility by a line of undefined length.

So let us take two products, one of which is worth twice the other. They may be represented by the following lines:

IB,

ID,

le produit total, l’utilité générale, ce qui satisfait le besoin, la richesse absolue;

IA,

IC,

le concours de la nature, l’utilité gratuite, la part de la communauté;

AB,

CD,

le service humain, l’utilité onéreuse, la valeur, la richesse relative, la part de la propriété.

IB and ID is the total product, general utility, what satisfies need, absolute wealth.

IA and IC is the contribution of nature, gratuitous utility, the share of the community.

AB, and CD is human service, onerous utility, value, relative wealth, the share of (private) property.

I have no need to say that AB, in place of which you may put, as the thought takes you, whatever you like, a house, an item of furniture, a book, an (operatic air) sung by Jenny Lind,[1034] a horse, a length of fabric, a consultation with a doctor, etc. would be traded for twice CD and that the two parties to the contract would give each other without even noticing it, one IA for one party and twice IC for the other, over and above the contract.

Man is so made that his perpetual concern is to reduce the ratio of effort to result, to substitute the action of nature for his own action, in a word, to do more with less. This is the constant aim of his skill, his intelligence, and his enthusiasm.

Let us suppose that Jean, the producer of IB,[1035] discovers a process by which he accomplishes his work with half the labor that he needed before, with everything, even the manufacture of the tool intended to harness a force of nature, taken into account.

As long as he retains his secret, nothing will change in the figures above. AB and CD will represent the same values and the same ratios since, because he is the only person in the world to know the faster process, Jean will use it to his sole advantage. He will relax for half the day or else he will make two IBs a day instead of one and his work will be better rewarded. The adoption will be made for the benefit of the human race but the human race will be represented in this respect by one single man.

Let us say in passing, and the reader ought to see here, how little an effect the following axiom, value comes from labor, held by English economists, has if its aim is to have people think that value and labor are proportional to each other. Here we find labor reduced by half without the value changing, and this happens all the time. Why? Because the service is the same. Before just as after the invention, as long as it remains a secret, the person who hands over IB is providing an identical service. This will no longer be the case on the day when Pierre, the producer of ID is able to say to him: “You are asking me for two hours of my work in return for one of yours. However, I know your process, and if you set such a high price on your service, I will provide it for myself.”

Well, this day will inevitably arrive. A successful process does not remain a secret for long. Then the value of the product IB will be reduced by half and we will have the following figures:

AA’ being the value eliminated, relative wealth that has disappeared, property that has become common to all, a utility that previously was onerous and now is gratuitous.

For Jean, who in this instance represents the producer, is returned to his original situation. With the same effort that he used in the past to make IB, he now makes two IBs. In order to obtain two IDs, he is now obliged to give two IBs, or items of furniture, books, houses, etc.

Who benefits from all this? It is obviously Pierre, the producer of ID, who in this instance represents all consumers, including Jean himself. If, in fact, Jean wishes to consume his own product, he will receive the saving in time represented by the elimination of AA’. As for Pierre, that is to say all the world’s consumers, they will purchase IB for half the time, effort, labor, or value that they had to devote before the intervention of the force of nature. Thus this force is gratuitous and, further more, common to all.

Since I have ventured into geometric figures, may I be allowed to use them once more, being fortunate if this rather strange procedure in political economy, I agree, helps the reader with the logic of the phenomenon I have to describe?

Whether as a producer or a consumer, everyone is a center from which radiate all the services he provides and where all the services he receives in exchange culminate.

Let us therefore take a producer placed in A (fig. 1), a (book) copier for example, the perfect representative of all producers and of production in general. He produces four manuscripts for society. If at the time we make the observation the value of each of these manuscripts is 15, he is providing services (equal to) 60 and receives equal value spread over a host of services. To simplify the demonstration, I am putting just four (arrows) starting from the four points on the circumference BCDE.

Value produced = 60          Value produced = 60

Value received = 60           Value received = 60

Utility produced = 4  Utility produced = 6

(Let us suppose that) this man invents printing. He now does in forty hours what used to take sixty. Let us assume that competition has obliged him to reduce the price of his books proportionally; instead of being worth 15, they are now worth just 10. But in addition, instead of four, our worker can make six. On the other hand the flow of payments, as given by the circumference and which was 60 has not changed. There is thus payment for six books, each worth 10, because it existed previously for four manuscripts each of which was worth 15.

I will briefly point out that this is where we always lose (our) perspective, (when we come to the problem of) (the use of) machines, of free trade, and of progress (in general) . We see labour being freed up (for other uses) by a faster process and this alarms us. We do not see that a similar proportion of payment is also freed up simultaneously.

New transactions will therefore be represented by figure 2 where we see radiating out from the center A a total value of 60 spread over six instead of four manuscripts. From the circumference an output of 60 continues to flow, now necessary as before to keep the balance.

Who has benefited from this change? From the point of view of value, nobody. From the point of view of real wealth and actual satisfactions, the countless class of consumers standing around the circumference. Each of them buys a book with a quantity of labour that has been reduced by one third. The consumers, however, are none other than the human race. For instance, note that A himself, while he gains nothing as a producer, and while he is required to do sixty hours of work as before to obtain the same amount of pay as before, nevertheless gains as a consumer of books, that is to say, on the same basis as other people. Like all of them, if he wants to read, he is able to provide this satisfaction for himself with a saving of labor of one third.

If as a producer he sees the benefit of his own inventions escape him in the long run because of competition, where (then) is his reward?

It consists (in the following):

1. that for as long as he was able to keep his secret, he continued to sell at fifteen what now costs him only ten;

2. that he obtains books for his own use at less cost, and thus shares in the advantages he has provided (to) society;

3. However, his reward consists above all in this: at the same time as he has been forced to make the human race benefit from his progress, he now benefits from the progress made by (the rest of) humanity.

In the same way as the advances accomplished in A have benefited B, C, D, and E, the progress achieved in B, C, D, and E will benefit A.

In turn A is to be found at the center and the circumference of world-wide industry, for he is in turn a producer and a consumer. If B, for example, is a cotton spinner who substitutes a spindle for the shuttle, the benefit will go to A as well as to C and D. If C is a sailor who replaces oars by sails, the saving will benefit B, A and E.

To sum up, (this) mechanism is based on the following law:

Progress benefits the producer as such only for the time required to reward his skill. A short time later, this progress causes a drop in the value of his innovation that leaves the initial imitators with a fair but lower reward. Finally the value is proportional to the reduced level of labor involved, and the entire saving is transferred to humankind in general.

In this way, everyone benefits from the progress made by each person, and each person benefits from the progress made by all. The “one for all and all for one” trumpeted by the socialists[1036] and broadcast to the world as a novelty contained in embryo in their schemes of oppression and coercion, has been provided for by God Himself; He knew how to make it an outcome of freedom.

God, as I have said, has provided for this, and He does not have to see to it that His law is upheld in a model commune directed by Mr. Considerant[1037] or in a phalanstery of six hundred of Fourier’s“harmonians,"[1038] or in a trial Icaria[1039] on condition that a few fanatics will submit themselves to the discretionary power of a monomaniac and that the unbelievers will pay for the (true) believers. No, God has provided for this in a general, universal manner through a marvelous mechanism in which justice, freedom, utility, and sociability blend and are reconciled to a degree that ought to discourage the entrepreneurs (who found) new social organisations.[1040]

Note that this great law, “one for all and all for one,” is much more universal than my argument supposes. Words are heavy and the pen is even heavier. Writers are reduced to elucidating, with distressing slowness and (laboriously) one after the other, phenomena which attract our admiration only when considered as a whole.

So, I have just discussed inventions.[1041] You might conclude from this that this is the only instance in which the progress (which is) achieved escapes the producer to swell instead the common fund available to all of humanity.[1042] This is not so. It is a general law that any advantage that arises from the particularities of place, climate, or some bounty of nature, slips rapidly through the hands of the person who first notices it and takes possession of it, without being lost for all that, going instead to swell the huge reservoir from which are drawn the common satisfactions of men.[1043] One single condition is attached to this result, and that is that labor and transactions should remain free. To oppose freedom is to oppose the wish of Providence, to suspend the effect of its (this providential) law and limit progress in both senses.

What I have just said about goods is also true for harms. Nothing stops with producers, whether advantages or disadvantages. Both tend to be spread over society as a whole.

We have just seen with what eagerness the producer seeks anything that can make his work easier, and we are persuaded that in a very short time the advantage will have escaped him. It seems that he is only the blind and docile tool of general progress in the hands of a higher intelligence.

It is with the same ardor that he avoids all that hinders his activities, and that is a good thing for the human race, for it is the human race in the end that is harmed by these obstacles. For example, let us suppose that a heavy tax is levied on A, the producer of books. He will have to add it to the price of his books. It will become a constituent part of their value, which means that B, C, D, and E will have to devote more labor to achieving the same satisfaction. The compensation for them will be in the use the government makes of the tax. If it uses it well they may not lose out, and they may even gain in the operation. If the government uses it to oppress them, this will be doubly troubling for them. But as for A, he was relieved of the burden of the tax even though he had to pay it to the state.

This is not to say that the producer does not often suffer from obstacles of all kinds, and among them taxes. He suffers from them sometimes even to the point of being put out of business and it is precisely for this reason that these obstacles tend to be displaced and eventually fall on the masses.[1044]

Thus in France, wine has been subjected to a host of taxes and shackles. Following this, a (regulatory) regime has been invented with respect to wine, that prevents it from being sold abroad.

It is by way of the ricochet effect[1045] that harm tends to be passed on from the producer to the consumer. Immediately after the tax and the shackles come into force, the producer wants to be compensated. However, since consumer demand as well as the quantity of wine remain the same, he cannot raise the price. Initially, he does not make more after the tax than before. And since before the tax he received only a normal reward for it, determined by the value of the services exchanged freely, he finds himself losing by the total amount of the tax.[1046] In order for prices to rise, there has to be a reduction in the quantity of wine produced. …[1047]

In relation to the profit or loss that initially affect this or that class of producers, the consumer, the general public, is what the earth is to electricity: the great common reservoir. Everything comes out of this reservoir, and after a few more or less long detours, after the generation of a more or less great variety of phenomena, everything returns to it.

[Section break - gap between paragraphs]

We have just noted that the economic results just flow over producers, to put it this way, before reaching consumers, and that consequently all the major questions have to be examined from the point of view of consumers[1048] if we wish to grasp their general and permanent consequences.

This subordination of the role of the producer to that of the consumer, which we have deduced from the analysis of utility, is fully confirmed by the analysis of morality.

Actually, responsibility is incumbent upon initiative everywhere. Well, where is the initiative? In demand.

Demand (which implies the means of payment) determines everything: the direction of capital and labor, the distribution of the population, the morality of occupations, etc. It is because demand is the result of desire while supply is the result of effort. Desire may be reasonable or unreasonable, moral or immoral. Effort, which is merely an effect, is morally neutral, or has only an indirect morality.[1049]

Demand or consumption says to the producer: “Do this for me.”[1050] The producer obeys the stimuli coming from others. And this would be obvious to all if producers always and everywhere waited for demand to occur.

But in practice, things happen differently.

Whether it is exchange that has led to the division of labor or the division of labor that has produced exchange, is a subtle and pointless question. Let us say that man makes exchanges because, being intelligent and sociable,[1051] he realizes that they are a means of increasing the ratio of result(s) to effort. What results solely from the division of labor and foresight is that a man does not wait for an offer to work for others. Experience teaches him that such offers are tacitly included in human relations and that demand exists.

He makes in advance the effort that should satisfy such demand and this is how occupations emerge. Shoes or hats are made in advance. People prepare themselves to sing well, to teach, plead (a legal case), heal (the sick), etc. Is it really perhaps supply that triggers and determines demand here?[1052]

No. It is because there is enough certainty that all these services will be in demand that people prepare to provide them (in advance), even though they do not always know exactly where the demand will come from. And the proof of this is that the relationship between these various services is sufficiently well-known and that their value is sufficiently a matter of general experience to encourage them to devote themselves to this productive activity with some security or take up this or that occupation.

The stimulus of demand is thus pre-existent, since it is possible to calculate its effect so accurately.

Thus, when someone adopts a trade or takes up a job, when he starts to produce something, what is his chief concern? Is it the utility of the thing he is producing or whether its results are good or bad, moral or immoral? Not at all. All that he thinks of is its value. It is the person who demands the good or service who concerns himself with its utility. Its utility meets his need, desire, or his fancy. Its value, on the other hand, merely corresponds to the effort being exchanged and the service provided. It is only when, through exchange, the person who offers the good or service becomes in his turn someone who demands a good or service[1053] that utility becomes of interest to him. When I decide to make shoes instead of hats, it is not because I have asked myself the question: Have men a greater interest in covering their feet rather than their heads? No, that is a question for the buyer and (he) determines the level of demand. Demand in turn determines the value or the esteem in which the public hold the service. In a word, value determines the effort (made) or (the) supply (produced).

This has very remarkable moral consequences. Two nations may be equally endowed with things of value, that is to say, relative wealth,[1054] and very unequally endowed with things of real utility or absolute wealth. This happens when one of these develops more unreasonable desires than the other, which considers its real needs, while the former is creating artificial or immoral needs for itself.

[gap between paras]

A taste for education may dominate one nation while fine food dominates the other. In this case, service is rendered to the first when you have something to teach it and to the second when you have something to titillate its palate.

Now, people pay for services depending on the importance they attach to them. If they did not exchange services they would produce the service for themselves, and what would make their minds up if not the nature and intensity of their desires?

In one of these nations, there will be a great number of teachers and in the other a great number of cooks.

In both of them the services exchanged may be equal in sum and consequently represent equal values, the same relative (amount of) wealth, but not the same absolute (amount of) wealth. That does not mean anything other than that one is using its labor well and the other badly.

And the result, from the point of view of satisfaction, will be this: one of these nations will be highly educated and the other will produce good meals. The later consequences of this diversity of taste[1055] will have a great influence, not only on real wealth but even on relative wealth, since education, for example, may develop new methods of rendering service which good meals are incapable of doing.

We may note among nations a very remarkable variety of tastes, which result from their history, character, beliefs, vanity, etc.

Doubtless there are needs that are so pressing, for example eating and drinking, that they may almost be considered as given quantities. Nevertheless, it is not rare to see one person depriving himself of sufficient food in order to have clean clothes and another considers the cleanliness of his clothes only after his appetite has been satisfied.

This is also true of nations.

But once these pressing needs have been satisfied, anything over and above them is much more dependent on human will. It is a question of taste, and it is in this domain that the preeminence of morality and common sense is huge.

The intensity of various national desires always determines the quantity of labor that each nation expends on the total quantity of its efforts in order to satisfy each of its desires. The Englishman wants to be well fed above all. He therefore devotes a huge quantity of his labor to producing food, and if he produces anything else it is in order to exchange it abroad for (more) food. All said and done, the quantity of wheat, meat, butter, milk, sugar, etc. consumed in England is staggering. The Frenchman wants to be entertained. He likes things that are pleasing to the eye and he likes change. The direction of his work is in docile obedience to his desires. In France, there are a great many singers, traveling players and artists, milliners, bars, elegant boutiques, etc. In China, they aspire to pleasant dreams through the use of opium.[1056] This is why a considerable amount of national labour is devoted to procuring this precious narcotic for themselves, either directly through production or indirectly through exchange. In Spain, where the people are (attracted) to the pomp and ceremony of religion, a large proportion of the population’s efforts is devoted to the decoration of religious buildings, etc.

I will not go so far as to say that there is never any immorality in effort whose aim is to provide services that meet immoral or depraved desires. But it is obvious that the principle of immorality is (lies) in the desire itself.

This would not be in doubt if man lived in isolation. It could not be in doubt either for humans living together, for human society is (just) an expanded form of individual existence.

Whoever thinks, actually, of blaming our workers in the south for making brandy? They are meeting a demand. They dig the earth, take care of their vines, harvest the grapes, and distill them without concerning themselves as to the use made of their product. It is up to the person seeking the satisfaction to know whether this satisfaction is honest, moral, reasonable, and beneficial. It is his responsibility. The world would not work without this. Where would we be if tailors had to say to themselves: “I will not make a jacket in the style I have been asked to because it is excessively opulent or because it hampers breathing, etc.”?

Is it any business of our poor wine producers if wealthy pleasure-seekers in London get drunk on French wine? And can the English be accused any more seriously of harvesting opium in India with the intention of poisoning the Chinese?

No, a frivolous people will always generate frivolous industries, just as a serious people generates serious industries. If the human race advances it is not because the producer has become moral but because the consumer has done so.

This is what religion has understood perfectly when it gives to the wealthy, to the great consumer, a serious warning about his immense responsibility. From another point of view and in another language, political economy comes to the same conclusion. It states that we cannot stop people supplying what has been demanded, that to a producer a product is just something valuable, a sort of cash that does not embody harm any more than good, whereas in the minds of the consumer it is utility, enjoyment (which is) neither moral nor immoral, such that it is for the person desiring and demanding the product to assume the consequences, (whether) useful or disastrous, and to answer before the justice of God or the opinion of his fellows, for the good or evil direction in which he has pushed labour.

Thus from whatever point of view that you adopt you see that consumption is the grand aim of political economy, that good and evil, morality and immorality, harmony and disharmony, all come to be decided by the consumer, for he represents the human race.[1057]

 


 

XII. Two Sayings

Modern moralists who contrast the saying: One for all and all for one[1058] with the ancient proverb: Everyone for themselves and everyone looking after their own,[1059] are insisting on a very inadequate idea of society, and for that very reason a very false one, and I will even add, much to their surprise, a very sad one.[1060]

Let us first get rid of what is superfluous in these two famous sayings. All for one is irrelevant, since it is necessarily subsumed in one for all and appears here only through a love of contradiction for its own sake. As for everyone looking after their own, this is a notion that has no direct link with the other three, but since it is highly significant in political economy we will be enquiring later into what it encompasses.

There remains the supposed conflict between the first part of the two sayings: one for all, and everyone for themselves. One, it is said, expresses the principle of fellow feeling, the other the principle of individualism. The first unites, the second divides.

If you merely wish to discuss the driving force that determines effort, the contrast is incontestable. However, I maintain that this is not so if you consider the mass of human effort from the point of view of its results. Examine society as it is, obeying the principle of individualism with regard to services that require payment, and you will discover that each person when working for themselves is in effect working for all. Indeed, this cannot be questioned. If the person reading these lines has a job or trade, I beg him to cast a glance at himself for a minute. I ask whether the object of all his endeavors is not to satisfy others, and even whether it is not to the work of others that he owes all his own satisfactions.

Obviously, those who say that everyone for themselves and one for all are mutually exclusive believe that individualism and association (with others) are incompatible. They think that everyone for themselves implies isolation or a tendency to isolation, that self-interest divides rather than unites, and that it leads to the outlook that everyone looks after their own, that is to say, to a lack of any form of social relationship.

In this, I repeat, they are taking a totally false view of society, because this view is (incomplete). Although driven only by self-interest, men seek to group together, to combine their efforts, to unite their forces, to work for each other, to render each other reciprocal services, and to be sociable[1061] or to associate with each other. It would not be true to say that they act in this way in spite of self-interest; no, they act in this way because of self-interest. They “are sociable” because they benefit from it. If it were something bound not to advantage them, they would not “be sociable.” Individualism thus achieves here the work that the sentimentalists of our era would like to entrust to fraternity, self-denial, or whatever other driving force in opposition to self-love. And this proves that Providence has known how to provide for sociability[1062] much more effectively than those who claim to be its prophets, a conclusion that we invariably reach. For there is only one alternative: either union (with others) is detrimental to the individual or it is beneficial to it. If it is detrimental, how will the socialists deal with it and what reasonable motives can they have for doing something that harms everybody? If, on the contrary, sociability is beneficial, it will be accomplished by virtue of self-interest, the strongest, most long-lasting, uniform, and universal of incentives, whatever anyone says.[1063]

And see how things happen. A squatter[1064] goes and clears some land in the Far West.[1065] Not a day goes by without his realizing how many problems isolation causes him. Shortly afterward, another squatter also wends his way toward the desert. Where will he erect his tent? Will he instinctively distance himself from the first settler? No, he will instinctively draw closer. Why? Because he is aware of all the benefits that, for an equal amount of effort, people obtain just by being close to one another. He knows that in a host of circumstances, they are able to lend and borrow tools from each other, do things together, overcome difficulties that would be insuperable if faced individually, create opportunities for mutual exchange, share ideas and views, and provide for their common defense. A third, fourth, and fifth squatter come into the desert and invariably they tend to be drawn to the smoke of the first settlements. Others may then arrive with more substantial capital, knowing that they will find hands to put to work. A colony is formed. Crops may be varied a little. A path may be made to the road on which the mail-coach passes. Imports and exports may be started. People may think of building a church, a school, etc. etc. In a word, the colonists become more powerful by the very fact of their proximity, in a manner exceeding by far the sum of their individual forces taken in isolation. This is the reason that drew them to each other.

But, people will say, everyone for themselves is a very sad saying and one that is very cold. All the lines of reasoning and paradoxes in the world will not stop it arousing our antipathy and exuding egotism[1066] for a league around it, and is not egotism not something worse than just an evil in society, is it not the source of all evil?

Let us be clear about this, please.

If the saying everyone for themselves is understood to mean that it has to direct all our thoughts, actions, and relationships, and that is should be the basis of all our affections as fathers, sons, brothers, spouses, friends, citizens, or rather that it ought to stifle all these kinds of affection, it is dreadful, horrible, and I do not believe that there is a single man on earth who, even if he made it the rule that governs his own conduct, would dare to proclaim it as a (general) principle.

But will the socialists always refuse to acknowledge, in spite of the authority of universal evidence, that there are two kinds of human relationships, the first subject to the principle of fellow feeling,[1067] which we leave in the moral domain, and the second arising from self-interest, established between people who do not know each other and who owe each other only justice, with these relationships regulated by agreements that have been voluntarily and freely negotiated? It is precisely the agreements in this latter category that form the domain of political economy. Well, it is no more possible to base these transactions on the principle of fellow feeling than it would be reasonable to base family relationships on self-interest.[1068] I will forever say to the socialists: “You are trying to confuse two things that cannot be confused. If you are crazy enough to do this, you will not be strong enough (to do this). The blacksmith, carpenter, or farmer who wear themselves out doing arduous work, may be excellent fathers and admirable sons with a highly developed moral sense and with the largest of hearts within their breasts. In spite of this, you will never persuade these people to work from morning to night by the sweat of their brow, imposing difficult privations on themselves, on the principle of devotion to others. Your sentimentalist pronouncements are and will always remain powerless. If, by misfortune, they attracted a few workers, these would be just so many dupes. If a merchant starts to sell according to the principle of fraternity, I do not give him a month before his children are reduced to beggary.

Providence has therefore done well to give sociability other guarantees. With man the way he is, whose feelings are inseparable from (his) person, it is impossible to hope that self-interest will ever be universally abolished, or to want it (to be) abolished, or even to grasp the idea (of it being so). This universality is nevertheless what would be needed for a just equilibrium between human relations, for if you break this mainspring (of individual behaviour) only in the souls of a few of the elite, you are creating two classes, the wicked, with an incentive to create victims, and the good, for whom the role of victim is reserved.

Since on the question of labor and trade, the principle everyone for themselves had inevitably to become the dominant driving force, what is admirable and marvelous is that the author of all things has used it to establish at the heart of the social order the (the principles behind) the fraternal saying one for all. His skilled hand has turned an obstacle into a tool, with general interest being entrusted (to the care of) self-interest, and with the former becoming infallible for the very reason that the latter is indestructible. It seems to me that (when) faced with these results communists and other inventors of artificial forms of society, will be able to recognize, without being too humiliated in the end, that in matters of organization, their rival up above is most decidedly more powerful than they are.

And you should clearly note that in the natural order of society, the one for all that arises from everyone for themselves is much more complete, absolute, and personal than it would be from the communist or socialist point of view. Not only do we work for all, but we cannot achieve any form of progress without having the community as a whole benefiting from it.[1069] Things are organized in such a wonderful way that when we have devised an (industrial) process or discovered one of nature’s bounties, a new form of fertility in the soil, or some new way of using one of the laws of physics, the benefit is temporarily and fleetingly ours, which is just from the point of view of the reward (it gives) and useful from the point of view of the incentives it creates, after which time the benefit escapes (from) us[1070] in spite of our efforts to retain it. From being individual it becomes social, and falls forever into the domain of the freely available Commons.[1071] And at the same time that we give the human race the benefit of our progress, we ourselves derive satisfaction from the progress made by everyone else.

In sum, (by following the principle of) everyone for themselves, all the efforts made by over-excited individualism (act in a way to promote the principle of) one for all, and each partial stage of progress is worth millions of times more to society in terms of the gratuitous utility (it creates), than it provides in profit to its inventor.

Under (the principle of) one for all, nobody would act even for himself. What producer would dream of doubling his labor in order to achieve an extra thirty-millionth part of his earnings?[1072]

Perhaps the question will be asked whether it is any use refuting the socialist saying(s). What harm can it do? Doubtless, it will not introduce the principle of self-denial into workshops, trading establishments, or shops, nor will it make this principle the prevailing ethos of fairs and markets. In the end, however, either it will have no effect, in which case you can leave it to slumber peacefully, or it will make the rigidity of the the egotistical principle slightly more flexible, a principle that is devoid of any fellow feeling and (hence) (has) scarcely (any) right to (be made) ours.

What is wrong is always dangerous. It is always dangerous to represent a universal principle, one that is eternal and that God has obviously designed for the preservation and advancement of the human race, as worthy of condemnation and damnable. I agree that, as a driving force (of society), it does not speak to our hearts, but it astonishes and satisfies our minds because of its results. What is more, a principle like this gives free scope to driving forces of a higher order, ones that God has also placed in men’s hearts.

But do we know what happens? The socialists’ audience takes just half of their saying, (namely) the last half, all for one. They (nevertheless) continue to work for themselves, but in addition they demand that everyone else should work for them as well.

And this had to be so. When the dreamers wished to change the mainspring of human action[1073] in order to substitute fraternity for individualism, what did they think would happen? A doubly hypocritical contradiction. They began to proclaim to the masses “Stifle self-interest in your hearts and follow us! You will be rewarded with all the goods and pleasures in the world!” When one tries to parody the tone of the Gospels, one has to reach the same conclusions as they do. Fraternal self-denial involves sacrifice and suffering. “Dedicate yourselves (to others)” means “Take the lowest place, be poor, and suffer voluntarily.” But, under the pretext of renouncing (worldly goods), they promise the enjoyment of them; (thus) showing that behind the supposed sacrifice there is well-being and wealth; and to combat the passion which is stigmatized as egotism, (they call) upon the most materialistic tendencies: this was not only to bear witness to the indestructible vitality of the principle they wished to destroy, it was to exalt it to the highest degree while declaiming against it. It was to double the strength of the enemy instead of overcoming it, substituting unjust envy for legitimate individualism, and in spite of the trickery of some form of mystical jargon or another, to whip up the grossest form of sensualism. Greed had to respond to this call. [1074]

And is this not the situation we are (currently) in? What is the universal cry that comes from all ranks and all classes? All for one! In pronouncing the word one we are thinking of ourselves, and what we are asking for is to take an unwarranted share of the work of all. In other words, we are turning plunder into a system.[1075] Simple and direct plunder is doubtless so unjust that it repels us, but thanks to the saying all for one, we still the scruples of our conscience. We assign to others the duty of working for us and then we assign to ourselves the right to benefit from the labor of others. We call upon the state to introduce a law imposing this supposed duty and protecting this supposed right, and the strange result of this is that we mutually rob each other in the name of fraternity. We live at other people’s expense[1076] and it is in this very capacity that we attribute the heroism of sacrifice to ourselves. How strange is the human mind! What subtle convolutions envy generates! It is not enough for each of us to endeavor to expand his share at the expense of others, it is not enough to want to benefit from work we have not done, we still delude ourselves that we are showing ourselves to be sublime in the practice of the principle of devotion to others; we come dangerously close to comparing ourselves with Jesus Christ and we blind ourselves to the point of failing to see that it is not we who are making these sacrifices which arouse tears of admiration in us when we look at ourselves, but rather we who are demanding them (from others).

The way this great hoax is being perpetrated is worth examination (in more detail).

Theft! How terrible! What is more, it leads to penal servitude, for the law forbids it. But if the law ordered it and lent it assistance, would this not be convenient? What a brilliant idea![1077]

Immediately some slight privilege is asked from the law, just a tiny monopoly, and since a small amount of trouble must be spent in order to have it respected, the state is asked to take charge of this. The state and the law come to an agreement in order to carry out exactly what it is their mission to prevent or punish. Little by little, the taste for monopolies grows. There is no class that does not wish to have its own. “All for one," they exclaim, “We also want to show ourselves to be philanthropic and to have people see that we understand (what) solidarity (is).”

It so happens that the privileged classes, in (mutually) robbing each other, lose at least as much through the abuses they suffer as they do from the abuses they inflict on others. What is more, the great mass of workers, to whom privileges could not be given, suffer, grow weak, and cannot resist it. They rise up and cover the streets with barricades and blood, and all of a sudden they have to be taken into account.[1078]

What will they be asking for? Will they demand the abolition of abuse, privileges, monopolies, and the restrictions under which they are laboring? Not at all. They too have been imbued with (the idea of) philanthropy. They have been told that the famous (saying) all for one was the solution to the social problem. Many examples have shown them that privilege (which is just theft) is nevertheless highly moral if it is based on the law. So that we see the people demanding …What? … Privileges! They too call upon the state to give them education, work, credit and assistance at the people’s expense.[1079] Oh, what a strange illusion![1080] And how long will it last? We can easily imagine all the upper classes, starting with the uppermost, coming one after the other to claim favors and privileges.[1081] Beneath them, there is the great mass of the people on which all this falls. But for the people, once they are victorious, to imagine that they also may join the privileged class as a group, create monopolies for themselves, (but also imposed) upon themselves; (to) enlarge the extent of these abuses in order (for them) to live from it, and (to) fail to see that there is nobody beneath them to supply the (means to pay) for these injustices, is one of the most astonishing phenomena of our age and any other age.

What happened? This was the path that has led society toward (a) general shipwreck. Society has had good reason to become alarmed. The people soon lost their power and (their) former share of these abuses has returned to its customary position for the time being.[1082]

However the lesson has not been totally lost (on) the upper classes. They are aware that the workers have to be given justice. They very much want to achieve this, not only because their own security depends on it but also, it has to be acknowledged, out of a sense of justice. Yes, I say this with total conviction, the wealthy class asks for nothing better than to find the solution to this great problem. I am convinced that if most of the wealthy were asked to give up a considerable part of their fortune with the guarantee that henceforward the people would be happy and satisfied, they would happily make the sacrifice.[1083] They therefore ardently seek, to use the familiar phrase, some way of coming to the assistance of the working classes. But how do they envisage doing this? Once again (it is) the communism of privileges,[1084] but a diluted form of communism, which they delude themselves they can keep within prudent limits. That is all. They stick to that …[1085]

 


 

XIII. On Rent[1086]

If, when the value of land increases, a similar increase were observed in the price of the products of the land, I would understand the opposition to the theory set out in this book.[1087] It might be said that “As civilization develops, the situation of workers deteriorates in comparison with that of landowners. This is perhaps an inevitable necessity, but it is certainly not a harmonious law.”

Fortunately, this is not so. In general, the circumstances that cause the value of the land to rise simultaneously decrease the price of food. Let us use an example to explain this.

Let us take a field that is worth 100 francs situated ten leagues from a town. A road is built close to this field, which makes harvests more accessible, and the field’s value instantly rises to 150 francs. The landowner, now having acquired the means either to make improvements or grow a wider variety of crops, improves his property, and it reaches the value of 200 francs.

The value of the field has thus doubled. Let us examine this added value first of all from the point of view of justice, and then of the utility acquired, not by the landowner, but by the consumers in the town.

As for the increase in value resulting from the improvements the landowner has made at his own expense, there is no doubt (it is justly acquired). It is capital, which is subject to the law governing all forms of capital.

I am bold enough to say that this is true for the road. The operation is a more roundabout one, but the result is the same.

Indeed, because of (the taxes levied on) his field, the landowner contributes to public expenditure. For many years, he has contributed to (public) works of general public utility (which have been) carried out in distant parts of the territory, and at last a road has been made in an area useful to him. The sum of taxes paid by him can be thought of as shares he might have taken in government enterprises and the annual return he receives as a result of the new road, as the dividend on these shares.[1088]

So can it really be said that a landowner always has to pay taxes and never receives anything for them?.. This case then brings us back to the preceding one; the improvement, although achieved through the complicated and more or less questionable avenue of taxation, may be considered as having been executed by the landowner at his expense to the extent of the partial advantage he draws from it.

I have spoken about a road: note that I might have cited any other intervention by the government. Security, for example contributes to adding value to land as it does to capital or labor. But who pays for security? Landowners, capitalists, and workers. If the state spends its money well, the value spent ought to be restructured and (eventually) find its way back, in one form or another, into the hands of landowners, capitalists, and workers. In the case of landowners, it can appear only in the form of an increase in the price of his land. If the state spends its money badly, it is a disaster; the tax is wasted and it was up to taxpayers to keep an eye on it. If this occurs, there is no increase in the value of the land and this is certainly not the fault of landowners.

However, do buyers in towns pay more for the products of the land that have thus increased in value, both as a result of action by the government and by individual industry? In other words, is the interest on this sum of one hundred francs levied on each hectoliter of wheat that the field produces? If people had paid 15 francs per hectoliter, would they then have to pay 15 francs plus a fraction? This is a very interesting question since justice and the universal harmony of interests depends on it.

Well, I am bold enough to say: No.

The landowner will probably now recoup 5 francs more (assuming that the rate of profit is 5 percent) but he will not recoup this sum at anyone’s expense. On the contrary, the buyer, for his part, will derive an even greater advantage.

As it happens, the field that we have used as our example was previously not very accessible and was not used to produce much; because of the problems of transport, when its products reached the market, they were very expensive. Now production has been stimulated and transport (has) become (more) economic; a greater amount of wheat reaches the market at lower cost of transportation and is sold more cheaply. While leaving a total profit of 5 francs for the landowner, the buyer is able to make an even greater gain.

In a word, an economizing of forces has been made. For whose benefit? For the benefit of both parties to the contract. What law governs the sharing of this gain over nature? The law we have often cited with regard to capital, since this increase in value is a form of capital.

When capital increases, the landowner’s or capitalist’s share increases in absolute value and decreases in relative value; the worker’s (or consumer’s) share increases both in absolute and relative value.

Note how things happen.[1089] As civilization is established, the land closest to the centers of population increases in value. Production at a lower level gives way to production at a higher level. First of all, pastureland disappears to the benefit of cereals and then these give way to market gardening. Supplies arrive from further afield at lower cost, with the result that, and this is an undeniable fact, meat, bread, vegetables, and even flowers are cheaper there than in less developed regions, in spite of the fact that labor is better paid than elsewhere. …[1090]

Le Clos Vougeot[1091]

…Services are exchanged for other services. Services prepared in advance are often exchanged for current or future ones.

The value of services does not depend on the labor they require but on the labor they save.[1092]

Well, it is a fact that human labor is constantly improving.

From these premises a phenomenon of prime importance in social economics is deduced, and this is: In general, past labor loses value when exchanged for current labor.[1093]

Twenty years ago,[1094] I made a thing that took me one hundred days of work. I propose an exchange and say to my buyer: “Give me something that costs you one hundred days as well.” He will probably be in a position to tell me “Progress has been made in twenty years. What took you one hundred days now takes only seventy. Well, I do not measure your service by the time it has taken you but by the service it renders me. This service is now just seventy days, since this is the time it would take me to do it myself or find someone to do it for me.”

The result of this is that the value of capital decreases constantly and that capital or previous labor is not as favored as superficial economists believe.

There is no aging machine that does not lose value, apart from depreciation due to use, for the sole reason that better ones are being made currently.

This is also true for land. And there is very little land that, in order to attain the level of fertility it currently enjoys, has required more labor than would be needed today, when more powerful means are available

This is the general but not necessary trend.

Previous labor may render greater service today than in the past. This is rare but does occur. For example, I have stored some wine that represents twenty days of work. If I had sold it immediately, my work would have received a certain level of remuneration. I have stored my wine; it is improved, and the harvest that followed failed. In short the price went up, and my remuneration is greater. Why? Because I am rendering (a) greater service; customers would have more trouble in finding this wine if I had not had it and I am satisfying a need that has increased or become more appreciated, etc.

This is what always has to be looked into.

There were one thousand of us. Each of us had his hectare of land and cleared it. Time went by, and we sold it. Well, it so happens that out of 1,000, there are 998 who do not or ever will receive payment representing as many current days of labor in exchange for their land as the number of days it cost them in the past. This is because the heavier labor done in the past does not render as much service, comparatively speaking, as current labor. However, there were two landowners whose work was more intelligently done, or more fortunate if you like. When they offered it on the market, it was found to represent unparalleled services. Everyone said to himself: “It would cost me a great deal to provide this service for myself, so I will pay a high price for it, and provided that nobody uses force I will always be certain that it will not cost me as much as if I obtained this service by some other means.”

This is the story of Le Clos-Vougeot. It is the same tale as the one about the man who finds a diamond,[1095] or who has a fine voice,[1096] or (unusual) height to exhibit for five sous, etc. …[1097]

In my region (of Les Landes),[1098] there is a great deal of uncultivated land. Strangers do not fail to ask: “Why do you not cultivate this land?” “Because it is bad land.” “But right next door there is exactly the same land that has been cultivated.” To this objection, the local farmer finds no answer.

This is because he was wrong in his first assessment: is it bad land?

No, the reason new land is not being cleared is not that it is bad, and there are excellent pieces of land that are not being cleared either. Here is the reason for this: It is because it costs more to bring this uncultivated land up to a similar level of production to the neighboring field that is cultivated than to buy this neighboring field itself.

Well, for anyone with a thinking mind, this is incontrovertible proof that land has no intrinsic value. …

(Develop all the points that can be extrapolated from this idea.) …[1099]

 


 

XIV. On Wages

People ardently yearn for (economic) stability. In the world you certainly do find a few restless and adventurous souls for whom risk is a sort of need. Nevertheless, it may be stated that people as a whole like to be unworried about their future, to know what to expect, and to be able to make arrangements in advance. To understand how much they hold stability dear, you have only to see how enthusiastically they go after government jobs.[1100] It should not be said that it is because of the honor they confer. Some jobs certainly do not involve very demanding work. They consist in, for example, supervising, investigating, and annoying citizens. These are nonetheless sought after. Why? Because they are safe employment. Who has not heard the father of a family say about his son: “I am asking for an opening for a temporary appointment in such and such a department on his behalf. It is undoubtedly regrettable that they require an education that has cost me a great deal of money. It is even more certain that with this education he might have pursued a more brilliant career. He will never become wealthy as a government functionary but he is certain to earn a living. He will always have something to eat. In four or five years’ time he will begin to earn 800 francs and will rise by degrees to 3 or 4,000 francs. After thirty years’ service, he will have the right to a pension. His existence is thus assured: it is up to him to be able to lead it in a modest obscurity, etc.”

Stability therefore has a very powerful attraction for people.

And nevertheless, when you consider the nature of man and his work, it would appear that stability is incompatible with that nature.

If anyone imagines himself at the beginning of human society, he would have a problem understanding how a host of people can manage to withdraw from the social bank[1101] a regular, assured, and constant standard of living. This too is one of those phenomena that do not surprise us as they should, precisely because we see them all the time. Here we have government functionaries who earn fixed salaries, landowners who know what their income will be in advance, rentiers who can calculate accurately their returns, and workers who earn the same pay every day. If you leave money out of this, since it intervenes only to facilitate making evaluations and exchanges, you will see that what is settled is the level of their standard of living, the value of the satisfactions received by these various categories of workers. Well, in my view this stability, which is gradually extending to everyone and all the various kinds of work, is a miracle of civilization, a prodigious achievement of this society of ours, so foolishly decried these days.

For let us imagine ourselves back in a primitive social state. Let us suppose that we said to a people of hunters, fishermen, shepherds, warriors, or farmers: “As you progress, you will increasingly know in advance the total amount of enjoyment you will be assured each year.” These worthy people would be unable to believe us. Their answer would be: “That will always depend on something that cannot be calculated, for example the inconsistency of the seasons, etc.” This is because they could not imagine the ingenious efforts by which people have succeeded in establishing a form of insurance which covers all locations and all types of weather.

Well, this mutual insurance against future vicissitudes is totally dependent on a type of human science that I will call statistical risk analysis.[1102] And since this statistics is making unlimited progress, based as it is on experience, it follows that stability also makes unlimited progress. It is encouraged by two constant circumstances: 1. men yearn for it, and 2. each day they acquire the means to achieve it.

Before showing how stability is established in human transactions in which at first sight nobody appears to concern himself with it, let us see how it results from the following transaction in which it is the specific objective. The reader will thus understand what I mean by statistical risk analysis.

A group of men each has a house.[1103] One house burns down and its owner is ruined. Alarm is immediately spread among all the others. Each says to himself: “This might happen to me.” It is therefore not surprising that all the owners join together and spread out the bad risk as far as possible by establishing a mutual insurance agreement against fire. Their agreement is very simple. Its formula is this: “If one of our houses burns down, the others will raise money to help the victim of the fire.”

In this way, each owner acquires a double certainty: first of all, that he will have a small share in all the disasters of this type and second that he will never have to suffer the entire loss (alone).

Basically, and if the calculation is made over a great number of years, it can be seen that the owner has made an arrangement with himself, so to speak. He saves what he needs to repair the accidents that might afflict him.

And here we have an association. It is exactly to this sort of arrangement that socialists restrict the word association.[1104] As soon as speculation intervenes, in their view, association disappears. In my view, it is perfected, as we shall see.

What has caused our owners to form an association and insure each other mutually is a love of (economic) stability and security. They prefer a known probability to an unknown probability, a host of small risks to one large one.

However, their aim is not totally achieved and there is still much that is random in their situation. Each of them may say to himself: “If accidents multiply, will not my share become unbearable? In any case, I would like to know this in advance and insure my furniture, goods, etc. in the same way.”

It appears that these inconveniences are in the nature of things and that it is impossible for people to escape them. After each step of progress is made, they are tempted to think that their achievement is complete. How, indeed, can we eliminate the randomness that arises from accidents that are still unknown?

But mutual insurance has developed in our society a well-tested body of knowledge, namely of the annual average proportion of losses through accidents compared with the overall value of property insured.

Following which, an entrepreneur or a company, having done the calculations, goes to owners and says:

“By insuring yourselves mutually, you wanted to buy peace of mind, and the unspecified share that you set aside annually to cover accidents is the price that such a precious gift costs you. However, this price is never known in advance and on the other hand, your peace of mind is never total. Well then! I can offer you another way. For a fixed annual premium that you will pay me, I will be responsible for all your accident risks. I will insure all of you and this is the capital that guarantees that I will carry out my undertakings to you.”

The owners rush to accept even though this fixed premium costs slightly more than the average amount of their mutual insurance, for what is most important to them is not to save a few francs but to acquire total respite and peace of mind.

This is where the socialists claim that association has been destroyed. For my part, I maintain that it has been perfected and is on the way to other unlimited improvements.[1105]

But, say the socialists, those who are insured no longer have any link with each other. They no longer see or talk to each other. Parasitical middlemen[1106] have come between them and the proof that the owners now pay more than necessary to cover accidents is that insurers make large profits.

This criticism is easy to answer.

First of all, the association continues in another form. The premium paid by those insured is still the fund that will pay for accidents. Those insured have found the way to remain in (the) association without having to concern themselves with it. Obviously this is an advantage for each of them, since the aim pursued has not been any the less achieved and the opportunity of remaining in (the) association while retaining their independence of movement and the free use of their faculties is precisely what characterizes social progress.

As for the profit made by the middlemen, this can be explained and justified perfectly. Those insured remain in (the) association for compensation for accidents, but a company has intervened, offering them the following advantages: 1. it removes the random element in their situation; 2. it removes from them all the attention and work required should an accident occur. These are services. Well, (as we have said elsewhere), “one service in return for another.” The proof that the company’s intervention is a service of value is that it is freely accepted and paid for. Socialists are just ridiculous when they speak out against middlemen. Have these middlemen imposed themselves by force? Isn’t their sole means of gaining acceptance to say: “I will cost you a certain amount of trouble but will save you more.” Well, if this is so, how can they be called parasites or even middlemen?

Finally, I state that association(s) transformed in this way are on the road to new kinds of progress in all sorts of ways.[1107]

Indeed, the (insurance) companies that hope for profits which grow as the extent of their business (grows), promote the sale of insurance policies. To do this, they have agents everywhere, they make loans and dream up a thousand ways to increase the number of insurance clients, that is to say, members of the association. They insure a host of risks that go beyond the original mutual arrangement. In short, (the) association extends gradually to a greater number of people and things. As this development occurs, it enables companies to reduce their prices; they are even forced to do so by competition. And here we find the great law again: the benefits slip through the hands of the producer and come to rest with the consumer.[1108]

That is not all. The companies insure themselves with each other through reinsurance, so that from the point of view of recovering their losses, which is the heart of the matter, a thousand different associations based in England, France, Germany, or America have merged into a huge, single association. And what is the result? If a house burns down in Bordeaux, Paris or anywhere else, owners the world over, whether English, Belgian, from Hamburg, or Spanish have their subscriptions ready and are prepared to cover the loss.

This is an example of the degree of power, universality, and perfection that free and voluntary association can attain. But to do this, it has to be left free to choose its own procedures. Well, what happened when socialists, these great partisans of association, were in power? They had nothing more urgent to do than to threaten association in whatever form it took, in particular, the association of insurance companies. Why? Precisely because, in order to become universal, it uses this process of enabling each of its members to remain independent. They want to take us back to the time when society was born, when it emitted its first cries for food and made its first stumbling attempts to walk, to return us to the original and almost uncivilized forms of association (we had at then). They (would) eliminate all forms of progress on the pretext that it diverges from these (original) forms.

We will see that it is as a result of these very prejudices and the same ignorance that they constantly speak out either against interest or against wages, those fixed and consequently much improved forms of remuneration of capital and work.

Wage-earners have been the particular object of socialist attack. They came within a whisker of being labeled a scarcely watered-down form of slavery or servitude. In any case, socialists saw in this class an abusive and unconscionable convention (which was) free only in appearance, an oppression of the weak by the strong, and tyranny exercised by capital over labor.

Forever in conflict about which institutions to set up, they show a touching unanimity in their common hatred of existing institutions, in particular the system of wage payment, for while they cannot agree on their preferred social order, it has to be acknowledged that they always agree on belittling, decrying, misrepresenting, hating, and generating hatred toward what already exists. I have mentioned the reason for this elsewhere.[1109]

Unfortunately, not everything took place in the domain of philosophical discussion, and socialist propaganda, seconded by an ignorant and cowardly press that, without acknowledging that it was socialist, was no less in search of popularity through fashionable oratory, and succeeded in having a hatred of the wage system permeate the class of wage earners themselves. Workers were repelled by this form of remuneration. It seemed to them unjust, humiliating, and odious. They thought that it stamped them with the sign of servitude. They wanted to be part of the distribution of wealth using other systems. From there to being infatuated with the wildest utopias was just a step, and they took that step. In the February revolution, the major concern of the workers was to rid themselves of wages. They consulted their gods as to the means, but on the occasions when their gods did not remain in their habitual dumbness, they issued obscure oracles dominated by the great word association, as though association and wage were incompatible.[1110] The workers then wanted to try all forms of this liberating association and, to make it more attractive, they were eager to embellish it with all the charms of solidarity and attribute to it all the merits of fraternity. For a moment, you might almost have thought that the human heart itself was about to undergo a major transformation and that the yoke of interest was being shaken to allow entry to the principle of selflessness alone. What a strange contradiction! People hoped that association would bring together (at the same time) both the glory of sacrifice and profits unknown until then. They were running after fortune while craving and awarding themselves the applause due to martyrs. These misled workers, on the point of being inveigled into a career of injustice, apparently felt the urge to delude themselves, to glorify the systems of plunder that they took from their apostles, and to place them, covered with a veil, in the sanctuary of (a) new revelation. Probably never have such dangerous errors, so many gross contradictions become imbued in the human mind.

Let us therefore see what constitutes a wage. Let us consider its origin, its form, and its effects. Let us acknowledge its raison d’être and let us be clear as to whether it has been a step backward or an advance in the development of the human race. Let us ascertain whether it is intrinsically humiliating, degrading, or soul-destroying, and whether it is possible to see the link with slavery it is claimed to have.

Services are exchanged for other services. What people hand over, just like what they receive, is labor, effort, trouble, care, and natural or acquired skill. What people give to each other are satisfactions, what determines the exchange is common advantage, and what measures it is the free assessment of the reciprocal services. The host of arrangements to which human transactions have given rise, have required a huge economic vocabulary, but the words “profit,” “interest,” and “wages,” which express slight differences, do not change the underlying character of things. It is still the do ut des (product for product), or rather the facio ut facias (service for service)[1111] that is the basis for all human development from the economic point of view.

Wage earners are no exception to this rule. Let us look at them closely. Do they provide services? There is no doubt on this score. Do they receive services? That is not in doubt either. Are these services exchanged willingly and freely? Is there any sign of the presence of fraud or violence in this kind of transaction? It is perhaps here that workers’ complaints begin. They do not go so far as to claim that they are stripped of their freedom, but they do claim that this freedom is purely nominal, and even ridiculous, since he who is subject to necessity in making choices is not truly free. It remains to be seen whether the lack of freedom as understood thus does not relate to the situation of the worker rather than to the method by which he is paid.

When one man offers to work in the service of another, his remuneration may consist in a share of the output produced, or else in a fixed wage. In either case he has to negotiate this share, for it may be more or less large, or this wage, for it too may be more or less large. And if this man is utterly destitute, if he cannot wait and is spurred on by urgent need, he will have to submit to the imposition and cannot avoid the demands of the person he is negotiating with. But it has to be clearly noted that it is not the form of remuneration that creates this type of dependence for him. Whether he runs the risk of the (outcome of the) enterprise or negotiates a fixed rate of pay, his precarious situation is what places him in a position of inferiority with regard to the negotiation that precedes the transaction. The innovators who have presented association to the workers as being an infallible remedy have therefore both misled them and are themselves mistaken. They can ascertain this by observing attentively the circumstances in which poor workers receive a share of the output produced and not a wage. There are certainly no poorer people in France than the fishermen and wine producers in my region,[1112] even though they have the honor of enjoying all the benefits of what the socialists exclusively call association.

But before seeking what influences the level of pay, I have to define or rather describe the nature of this transaction.

It is a natural tendency in man, and therefore one that is positive, moral, universal, and indestructible, to yearn for security with regard to the means of existence, to seek (economic) stability, and to avoid the unforeseen.

In spite of this, when society was first formed, the unforeseen held sway, so to speak, unmitigated, and I have often been surprised that political economy has omitted to point out the great and successful efforts that have been made to restrict it within ever narrower limits.

And think about it: in a group of hunters in a nomadic tribe or in a newly founded colony, can anyone say with certainty what the next day’s labor would be worth to him? Do these two ideas not appear incompatible even, with nothing seemingly more unpredictable in nature than the output of labor, whether it be hunting, fishing, or agriculture?

For this reason, at the dawn of society it would be hard to find anything resembling salaries, retainers, stipends, wages, incomes, rents, interest payments, insurance premiums since these are all things that have been invented to provide increased levels of stability in personal situations and to remove as far as possible from the human race this distressing thought, that is terror of the unknown concerning the means of existence.

And it is true that the progress made in this connection is admirable, even though habit has made us so familiar with this phenomenon that we scarcely notice it. Indeed, since the results of labor and therefore of human consumption are so deeply affected by events, unforeseen circumstances, the caprices of nature, the uncertainty of the seasons, and accidents of all sorts, how can so many people, some for a time and others all their lives, be freed from the share of unpredictability that seems to be the very essence of our nature, by means of fixed earnings, rent, or retirement pensions?

The effective cause, the driving force of this fine evolution of the human race is the tendency of everyone to aspire to well-being, in which stability is so essential a part. The means is some kind of fixed payment covering assessable risks, or the gradual abandonment of the primitive form of association that consists in irrevocably linking all the members of the association with all the risks of the enterprise, in other words, the perfecting of the association. It is strange at the very least that the great reformers of our times want to tell us that association has been broken by the very factors which have led to its being improved.

In order for some people to agree to take upon themselves, for a fixed rate, risks that would naturally fall on others, a certain type of knowledge that I have called statistical risk analysis must have made progress, for experience has to put us in a position to assess these risks, at least approximately, and consequently the value of the service to the person who has been freed from them. This is why the transactions or associations of uncivilised and ignorant people never include clauses of this nature, and this being the case, as I said, the unforeseen holds total sway over them. If an elderly primitive hunter with a small stock of game takes a young hunter into his service, he would not give him a fixed salary, but a share in the game caught. How indeed could either lay down rules for the unknown based on the known? The lessons from the past do not exist at a high enough level for them to insure against future contingencies in advance.

In barbarous times when there was little knowledge of human experience,[1113] men doubtless were sobiable and formed associations[1114] because, as we have shown, they could not live without them, but in their case association can take only the primitive and elementary form that socialists are now telling us will be the rule and salvation of the future.

Later, when two people have worked together for a long time sharing the risk, there comes a time when, the risk becoming (statistically) assessable, one of them assumes it completely (in return for) an agreed level of payment.

This arrangement is certainly progress. To be convinced of this, you need only know that it was entered into freely with the agreement of both parties, and that it would not have occurred if it did not suit both of them. It is easy to understand its advantages. One gains by taking over all the risks of the enterprise and being able to manage them exclusively, the other by achieving the security of employment that people hold so dear. And as for society in general, it cannot fail to benefit from the fact that an enterprise previously pulled in two directions by two minds and two wills is now to be subject to a unified view and course of action.

But can it be said that because the association has been modified, that it has been dissolved, when the contribution made by both people continues and the only change that has been is to the way the product is shared? Above all, can it be said that it has become corrupt, when the innovation has been freely agreed to and satisfies all (involved)?

To achieve new means of satisfaction, the contribution of previous as well as current labor is almost always, and I might say always, needed. First of all, by joining forces in a common task, capital and labor are forced, each in part, to accept the risks of the enterprise. This remains the case until these risks can be statistically assessed.[1115] At that point, two trends, each as natural as the other to the human heart, become evident, by this I mean the trends to the unity of management and the stability of employment. Nothing is simpler than hearing capital say to labor:[1116] “Experience has shown us that your likely profit consists in an average remuneration for you of such and such a sum. If you like, I will take out insurance for you in this amount and then I will manage the operation, and the risk of profit or loss will belong to me.”

It is possible that labor will reply: “This proposal suits me. Sometimes in a year I earn only 300 francs while in other years I earn 900. These fluctuations inconvenience me; they prevent me from paying my expenses and those of my family regularly. It is an advantage for me to be relieved of this constant uncertainty and to receive a fixed payment of 600 francs.”

With this reply, the terms of the contract will be altered. Both parties will continue to pool their efforts and share the output and consequently the association will not be dissolved, but it will be modified in the sense that one of the parties, capital, will take responsibility for all the risks and the reward for all the exceptional profits while the other party, labor, will be ensured the advantages of stability. This is how wages began.

The agreement may be set up around the other way. Often it is the entrepreneur who says to the capitalist: “We have been working by sharing the risk. Now that we have a better knowledge of these risks, I propose that for you we handle them on a flat rate basis. You have 20,000 francs in the business in return for which in one year you received 500 francs and in another, 1,500 francs. If you are willing, I will give you 1,000 francs per year or 5 percent and will free you from any risk on condition that I manage the business as I think fit.”

The capitalist will probably reply: “Since since there are large and inconvenient fluctuations, on average I receive an average of no more than 1,000 francs per year, I prefer to have this sum regularly assured to me. In this way, I will remain part of the association through my capital but be relieved of all risk. My activity and my mind can now be devoted to other things with greater freedom.”

From both the social and individual points of view, this is an advantage.

We can see that in the heart of the human race there is a yearning for a stable situation (so) it works constantly to restrict and circumscribe all the elements of the unforeseen. When two people share the risk, this risk cannot be eliminated, since it exists of itself, but one person tends to take responsibility for it for a fixed fee. If capital assumes it, it is labor whose pay is fixed (and given) the name of wages. If labor wishes to assume the risk which could be to its advantage or not, then it is the remuneration of capital that is set aside and fixed (and given) the name of interest.

And since capital is nothing else than human services, it may be said that capital and labour are two words that basically express a common idea. Consequently this is also true of the words interest and wages. In the very place where false science never fails to find conflicts (of interests), true science always finds identity (of interests).

Thus, when its origin, nature, and form are considered, there is nothing intrinsically degrading or humiliating in wages any more than in interest. Both are the share that accrues to current and previous labor from the results of a common enterprise. The only thing is that almost always in the long term, the two parties to the association agree to accept a fixed remuneration for one of these shares. If it is current labor that wishes a uniform rate of pay, it hands over its share of the risk (in return) for a wage. If it is previous labor, it hands over its share of potential (profit) (in return) for interest.

For my part, I am convinced that this new agreement that has succeeded the original association, far from dissolving it, is an improvement of it. I have no doubt in this regard when I consider that it arises from a keenly-felt need, a natural tendency in everyone to seek (economic) stability, and that, in addition, it satisfies all the parties without damaging (the) general interest but, quite the opposite, serving it.

Modern reformers who, on the pretext of having invented the idea of association, would like to return us to its rudimentary forms, ought to tell us how flat fee contracts[1117] infringe law or equity, how they damage progress, and on the grounds of what principle (do) they claim to forbid them. They also should tell us why, if such agreements bear the stamp of barbarism, they are able to reconcile this (fact) with the steady and increasingly (common use of these agreements), something which they themselves proclaim is part of human perfectibility.

In my view, these agreements are some of the most wonderful manifestations and one of the most powerful (main) springs of progress. They are simultaneously the crowning (achievement) and the reward of a civilization with a long history and the starting point for a civilization whose future is unlimited. If society were to be kept to that original form of association in which all the parties concerned assume the risks of the business, ninety-nine percent of human transactions would not be completed. A person who is now involved in twenty enterprises would have been bound forever to a single one. Unity of vision and purpose would have been lacking in all undertakings. In a word, man would never have experienced this precious gift that may be the source of genius: (namely), (economic) stability.

It is therefore from a natural and indestructible tendency that the wage-system has arisen. We should, however, note that it satisfies men’s aspirations only imperfectly. It makes the payment of workers more uniform, equal, and closer to the average, but there is something it cannot do, any more than an association to share risks succeeds in doing, and that is to ensure that they have work.

And here I cannot prevent myself from noting the power of the sentiment I have been invoking right through this chapter and whose existence modern reformers do not appear to have suspected; by this I mean the aversion to uncertainty. It is precisely this sentiment that has made the task of inciting hatred for wages in workers so easy for socialist orators.

We can imagine three stages in the situation of workers: the stage in which uncertainty is predominant, the one in which stability is predominant, and an intermediate stage in which uncertainty, although partly excluded, still precludes a sufficient level of stability.

What workers have not understood is that association, in the form preached to them by socialists, is the infancy of society, the period of stumbling (about) and a time of sudden shifts and alternating (periods of) abundance and stagnation, in a word, the absolute reign of uncertainty. Wage labor on the contrary, is the intermediate stage that separates uncertainty from stability.

Well, the workers not yet feeling themselves anywhere near stability, like everyone who is suffering from an illness, place their hopes in some change of situation or another. For this reason, it has been very easy for socialism to impress them with the grand name of “association.” The workers believed that they were being impelled forward when in reality they were being pushed backward.

Yes, these unfortunate people were being pushed back toward the first stumbling steps of social evolution, for was association as it was being preached to them anything other than the subjection of everyone to all the risks? This was an inevitable arrangement in times of complete ignorance, given that flat-rate agreements assume at least the beginnings of statistical risk analysis. Was this anything other than the pure and simple restoration of the reign of uncertainty?

At this point the workers, who had been enthusiastic about association for as long as they had glimpsed it only in theory, changed their opinion as soon as the February revolution appeared to make the practice possible.

At that moment a great many employers, either because they were influenced by the universal enthusiasm or through fear, offered to replace (the payment of) wage(s) with a profit sharing arrangement. However, the workers retreated in the face of this “solidarity” (in the sharing of) risk. They understood that what they were being offered was the absence of remuneration in any form, that is to say, death, if the business made a loss.

People then experienced something that would not be to the honor of the working class in our country, if the blame did not deserve to be allocated to the supposed reformers in whom they were unfortunate enough to have placed their trust. They saw the workers claiming a bastard form of association in which wages would be maintained but where the sharing of the profits in no way entailed sharing any of the losses.

It is highly doubtful whether the workers had ever thought of putting forward claims like these of their own accord. In human nature there is a fund of common sense and justice that is repelled by obvious inequity. To deprave people’s hearts, you have to start by warping their minds.

This is what the leaders of the socialist school did not fail to do, and from this point of view I have often asked myself if their intentions were not perverse. Intention is a refuge that I am always inclined to respect; it is very difficult, to exonerate that of the leaders of socialism[1118] totally in these circumstances.

After having stirred up the working class against employers through the oratory that filled their books, oratory as unjust as it was persistent, after persuading them that it was a matter of war and that in time of war anything is permissible against the enemy, the socialist leaders wrapped the workers’ ultimatum in scientific subtleties and veils of mysticism in order to put the message across. They dreamed up an abstract being, Society, that owed each of its members a minimum, that is to say, an assured means of existence. “You have the right," they told the workers, “to demand a fixed wage.”[1119] In this way, they began to satisfy people’s natural inclination toward stability. They then taught that, in addition to a wage, workers ought to have a share of the profits, and when they were asked whether the workers ought also to have a share of the losses, they replied that through the intervention of the state and thanks to the guarantee of the taxpayers, they had conceived a system of universal industry sheltered from any losses. This was the means of removing any remaining scruples from the unfortunate workers who were seen during the February revolution, as I have said, to be only too willing to stake a claim for the following three clauses:

1. The continuation of the wage-system;

2. A share of the profits;

3. Freedom from any share in losses.

These demands may perhaps be said to be less unjust or impossible than it seems, since it has been introduced and maintained in many newspaper businesses, railway companies, etc.[1120]

My answer is that there is something really childish in deceiving yourself by giving grandiose names to insignificant things. With just a little good faith, you will probably agree that this share of the profits that a few businesses give to wage workers, does not constitute association and does not merit being called this, and is not a great revolution in the relationships between two social classes. It is an ingenious way of paying a bonus, a useful form of encouragement given to employees, in a form that is not altogether new even though the hope is to make it seem like adherence to socialism. Employers who adopt this custom and devote a tenth, a twentieth, or a hundredth of their profits, when they have any, to this act of generosity, may shout about it from the rooftops and proclaim themselves generous reformers of the social order, but it is really not worth our time to take any notice of it. And I return to my subject.

Thus, the wage-system was progress. At first, past labour and current labor were associated to share the risk and worked in joint enterprises the extent of which, under such terms, must have been quite limited. If society had not invented other arrangements no important work would ever have been carried out anywhere in the world. The human race would have remained at the stage of hunting, fishing, and a few attempts at farming.

Later, the two parties to the association, obeying a twin urge, one that makes us like and seek stability and the other that makes us want to direct the operations whose risk we assume, without dissolving their association, handled their shared risk by flat-rate agreements. It was agreed that one of the parties would pay the other a fixed amount and that this first party would assume all the risks and the direction of the enterprise on his own. When this fixed payment concerns previous labor it is called interest and when it concerns current labor it is called a wage.

However, as I have pointed out, a wage does not wholly achieve the aim of creating a state of (economic) stability or security for a particular class of people, with regard to the means of existence. It is a stage, and a significant and very difficult step, which would not have been thought possible at the outset, toward the achievement of this advance, but it does not achieve it completely.

It is perhaps not irrelevant to mention in passing that the security of employment and stability is like all the major achievements that the human race has pursued. It gets ever closer to them but never attains them. We will always make an effort to expand the extent of stability among us for the sole reason that stability is a good thing, but it is not in our nature to master it totally. We may even go so far as to say that it is not desirable, at least for man as he is at present. Absolute good of whatever kind would be the death of all desire, all effort, all arrangements, all thought, all foresight, and all virtue. Perfection excludes the ability to advance.

Therefore, once the working classes had risen, with (the passage of) time and as a result of the progress made by civilization, to the wage-earning system, they did not stop there in their effort to achieve stability.

No doubt a wage is sure to arrive at the end of a working day, but when circumstances, industrial crises,[1121] or quite simply illness have forced work to stop, wages stop as well, and then should the worker allow his food (supply) to stop, and that of his wife and his children?

Workers have just one solution. That is to save enough to meet the needs of old age and illness while they are working.

But, bearing in mind individual circumstances, who is able to calculate the length of time when he has to help himself compared to the the length of time when he has to be helped?

What is impossible for individuals becomes more practical for the masses by virtue of the law of large numbers. This is why this contribution paid during periods of work for (future) periods of unemployment, achieves its objective with much greater effectiveness, regularity, and certainty when it is centralized through an association than when it is left to individual risk.

This has given rise to mutual aid societies,[1122] admirable institutions, born of the gut instincts of the human race long before the very name of socialism was coined. It would be hard to say who invented this arrangement. I believe that its true inventor was need, our human yearning for stability, that constantly anxious and active instinct that leads us to fill the gaps that the human race meets in its progress toward the stability of conditions.

Be that as it may, I witnessed the spontaneous appearance of mutual aid societies more than twenty-five years ago among the most destitute workers and artisans in the poorest villages of the department of Les Landes.[1123]

The aim of these societies is obviously to achieve a general leveling in the amount of satisfaction, by spreading over all (the) stages of one’s working life the pay one has earned during the good times. In all the places where they exist, they have done a huge amount of good. The members of the association felt themselves to be supported by a feeling of security, one of the most precious and reassuring sentiments that accompanies man on his pilgrimage here on earth. What is more, they are all aware of their reciprocal dependence and of their usefulness to each other; they understand the extent to which the good and bad fortune of each individual or profession become the common good or bad fortune of the group. They come together for a few religious ceremonies provided for in their statutes; in sum they are called upon to exercise over each other that watchful looking out (for each other) so appropriate to inspiring in us self-respect at the same time as a feeling of human dignity, (which is) the first and difficult rung on the ladder of all civilization.[1124]

What has been at the root of the success of these societies up to now, a success that is in truth slow, like everything that involves the masses, is freedom and that can be explained.

Their natural pitfall is in the displacing of (individual) responsibility. Relieving individuals of the consequences of their own actions is never without the risk of creating great dangers and problems for the future.[1125] (On) the day when all citizens might say to themselves “We are paying a subscription to help those who are unable to work or who cannot find work,” it is to be feared that we will see developing to a dangerous degree people’s natural inclination to idleness and that soon those who are hardworking will be reduced to being the dupes of those who are lazy. Mutual assistance therefore implies mutual supervision, without which the assistance fund would be rapidly exhausted. This reciprocal surveillance that is a guarantee of existence for the association, and a certainty for each member of the association that he is not being duped, moreover constitutes the true moral basis for the institution. Thanks to it, drunkenness and debauchery are gradually disappearing, for what right would someone have to the help of the common fund who can be proved to have deliberately attracted illness and unemployment through his own fault and as a result of depraved habits? It is this surveillance that restores (individual) responsibility, whose main spring the association (if left to itself) tends to weaken.

Well, for this surveillance to take place and bear fruit, the mutual aid societies have to be free, clearly defined, and masters both of their statutes and their funds. They have to be able to vary their rules to suit the requirements of each location.

Let us suppose that the government intervenes. It is easy to guess the role it will take upon itself. Its first care will be to take control of all the funds on the pretext of centralizing them, and in order to disguise its aim it will promise to increase them through resources taken from taxpayers. “For," it will say, “Is it not only natural and just that the state should contribute to such a great, generous, philanthropic, and humanitarian task?” The first injustice is this: to use force to make the society admit (members) who have not made any contributions and who ought not be able to share in the distribution of the funds. Next, on the pretext of unity or solidarity (or anything else), it will plan to merge all the associations into one single one, subject to a uniform set of rules.

But, I ask, what would have become of the moral status of the institution when its fund is supplied by taxation, when nobody, other than some bureaucrat or another, will have an interest in defending the common fund, when each person, instead of considering it his duty to prevent any abuses, will take a delight in encouraging them, when all mutual surveillance will have ceased and feigning an illness will be nothing other than playing a good joke on the government? The government, to do it justice, is willing to defend itself, but as it can no longer count on private action, it has to replace it with public action. It will nominate auditors, controllers, and inspectors. Countless formalities will come between need and assistance. In short, an admirable institution will be transformed at birth into a government regulatory agency.[1126]

In the first instance, the state will see only the advantage of increasing the size of the vast throng of its appointees, increasing the number of government positions it awards, and extending its patronage and electoral influence.[1127] It will not see that by assuming new a function it has taken on a new responsibility, and I am bold enough to say that this responsibility is terrifying. For what will happen soon? Workers will no longer see the common fund as a property that they administer, contribute to, and whose (financial) limits restrict their claims (on it). Gradually they will come to see assistance in the case of illness or unemployment not as coming from a limited fund created by their own foresight but as a debt society owes them. They will not accept that it may be impossible for it to pay and will never be happy with the allocation of (the funds). The state will constantly be forced to ask for subsidies from the budget. At this point, when it encounters opposition from the Finance Committees,[1128] it will find itself in inextricable difficulty. Abuses will constantly increase and rectification will be postponed from year to year, as usual, until one day an explosion occurs. But when this happens, it will be apparent that the authorities are reduced to dealing with a population that no longer knows how to act for itself, that expects everything, even food, to be provided by ministers and prefects and whose ideas will have been warped to the extent that they have lost all notion of law, property, freedom, and justice.

These are just some of the reasons that I admit caused me alarm when I saw that a commission of the legislative assembly was given the responsibility of preparing a draft law on mutual aid societies.[1129] I was convinced that the time of destruction had come for them, and I was all the more distressed because in my eyes a great future awaits them, provided that they retain the life-giving air of liberty. Goodness me!, is it really so difficult to leave people alone to attempt, stumble, choose, make mistakes, remedy these mistakes, learn, work together, look after their property and interests, and act for themselves at their risk and peril and on their own responsibility? Do people not see that this is what makes them men? Will they always start from the fatal assumption that all those in government are tutors and all those being governed are pupils?[1130]

I believe that mutual aid societies have a great future before them if they are left to the care and vigilance of those concerned, and the only proof of this required is what is happening on the other side of the Channel.

“In England, individual foresight has not waited for government incentives to organize powerful and reciprocal assistance between the two classes which work. A long time ago in the major cities of Great Britain, free associations were founded which administer their own affairs, etc.

The total number of these associations in the three kingdoms is 33,223 and they have no fewer than three million fifty-two thousand members. This is half the adult population of Great Britain …

This great confederation of the working classes, this institution of effective and practical fraternity rests on the most solid of foundations. Their revenue is 125 million and their accumulated capital has reached 280 million.

It is from these funds that all needs are drawn when work is scarce or ceases. People are sometimes surprised to see England stand up to the repercussions of the huge and profound upheavals its vast industry experiences from time to time and almost periodically. The explanation of this phenomenon is largely to be found in the fact we are pointing out.

Mr. Roebuck[1131] wanted the government to show initiative and guardianship by taking charge of this very question because it was so immense … The Chancellor of the Exchequer refused.

Where individual interest is enough for people to govern themselves freely by themselves, the government in England considers it unnecessary to intervene. It keeps a watchful eye to ensure that everything is done within the law but leaves to each person the merit of his own efforts and the care of administering his own affairs in accordance with his own views and convenience. It is to this independence of its citizens that England certainly owes part of its greatness as a nation.”[1132]

The author might have added: It is also to this independence that its citizens owe their experience and personal dignity. It is to this independence that the government owes its relative lack of responsibility and consequently its stability.

Among the institutions that might develop out of the mutual aid societies when these have completed the evolution that they have scarcely begun, I place in the line the retirement fund for workers, because of its social importance.

There are some who dismiss an institution of this type as an illusion. These people doubtless claim to know those limits which in the interests of stability the human race cannot be allowed to cross. I will ask them the following simple questions: If all that they had ever known was the social condition of nations who lived from hunting or fishing, would they have been able to foresee, not such things as revenue from land, interest on loans, government securities, or flat-rate employment agreements, but even a system of wages, that first step towards job security of the poorest classes? And later, if all they had ever seen was the system of remuneration as we find it in those countries in which the spirit of association has not shown itself, would they have dared to predict the destiny in store for mutual aid societies as we have just seen them operate in England? Or have they any good reason to believe that it was easier for the working classes to raise themselves first of all to a system of wages and then to aspire to a mutual aid society than it would be to create a retirement fund? Is this third step any more insuperable than the other two?

For my part, I see that the human race thirsts after stability, I see that from one century to another, it increases its partial conquests that benefit one class or the other through wonderful procedures that appear to be far above any individual invention, and I certainly would not dare to say where we will stop along this road.

A positive note in this is that the retirement fund is a universal aspiration, one that is unanimous, energetic, and ardent in all workers, and this is only natural.

I have often asked them the question and have always noticed that the great sorrow in their lives is neither the weight of work nor the meagerness of their pay, nor even the sentiment of anger that the sight of inequality might provoke in them. No, what affects them and discourages them, what tears them apart and crucifies them, is the uncertainty of the future. Whatever occupation we are in, whether we are government functionaries, people of independent means, landowners, traders, doctors, lawyers, soldiers, or magistrates, we enjoy without realizing it, and consequently without being grateful, the progress achieved by society to the point where we no longer understand the torture of uncertainty, to put it this way. But let us put ourselves in the shoes of a worker or an artisan who, on awakening each morning, is haunted by the following thought:[1133]

“I am young and sturdy. I work and even think that I have less leisure and expend more effort than most of my fellow men. In spite of this, I can scarcely meet my own needs and those of my wife and family. But what will happen to me or them when age or illness has weakened my hands? I would need superhuman self-discipline, strength, and prudence to save enough from my wages to meet this time of misfortune. True, I am lucky enough to be healthy, and there are also mutual aid societies. But old age is not a risk; it is certain to arrive. I feel its approach each day and it will reach me; then, after a life of independence and hard work, what do I have to look forward to? The hospice, prison, or incapacity for me, begging for my wife ,and even worse for my daughter. Oh, why is there not some social institution that can take from me, even by force, while I am young, enough to ensure me bread in my old age!”

We really have to tell ourselves that this thought that I have just expressed so weakly is, as I write, tormenting the terrified imaginations of a huge number of our brethren every day, every night, and all the time. And when a problem presents itself under these conditions before the entire human race, we can be certain that it is not insoluble.

If the workers have alarmed other classes of society in their efforts to give more stability to their future, it is because they have directed these efforts in a false, unjust and dangerous direction. Their initial thought, which is standard in France, was to raid the public purse; to base the retirement fund on money raised by taxation, to have the state or the law intervene, that is to say to to get all the profits of plunder without having either its dangers or shame.

It is not from this quarter of the social horizon that the institution so desired by the workers may come. In order to be useful, solid, an