It is because Condillac has not the remotest idea of the nature of exchange-value that he has been chosen by Herr
Professor
Wilhelm Roscher as a proper person to answer for the soundness of his own childish notions.
Marx - Capital-Volume-I
He was so before he became buyer; he had already lost 10% in selling before he gained 10% as buyer.
12 Everything is just as it was.
The creation of surplus value, and therefore the conversion of money into capital, can consequently be explained neither on the assumption that commodities are sold above their value, nor that they are bought below their value. 13
The problem is in no way simplified by introducing irrelevant matters after the manner of Col. Torrens: --Effectual demand consists in the power and inclination (! ), on the part of consumers, to give for commodities, either by immediate or circuitous barter, some greater portion of . . . capital than their production costs. ? 14 In relation to circulation, producers and consumers meet only as buyers and sellers. To assert that the surplus value acquired by the producer has its origin in the
? 112 Chapter 5
fact that consumers pay for commodities more than their value, is only to say in other words: The owner of commodities possesses, as a seller, the privilege of selling too dear. The seller has himself produced the commodities or represents their producer, but the buyer has to no less extent produced the commodities represented by his money, or represents their producer. The distinction between them is, that one buys and the other sells. The fact that the owner of the commodities, under the designation of producer, sells them over their value, and under the designation of consumer, pays too much for them, does not carry us a single step further. 15
To be consistent therefore, the upholders of the delusion that surplus value has its origin in a nominal rise of prices or in the privilege which the seller has of selling too dear, must assume the existence of a class that only buys and does not sell, i. e. , only consumes and does not produce. The existence of such a class is inexplicable from the standpoint we have so far reached, viz. , that of simple circulation. But let us anticipate. The money with which such a class is constantly making purchases, must constantly flow into their pockets, without any exchange, gratis, by might or right, from the pockets of the commodity-owners themselves. To sell commodities above their value to such a class, is only to crib back again a part of the money previously given to it. 16 The towns of Asia Minor thus paid a yearly money tribute to ancient Rome. With this money Rome purchased from them commodities, and purchased them too dear. The provincials cheated the Romans, and thus got back from their conquerors, in the course of trade, a portion of the tribute. Yet, for all that, the conquered were the really cheated. Their goods were still paid for with their own money. That is not the way to get rich or to create surplus value.
Let us therefore keep within the bounds of exchange where sellers are also buyers, and buyers, sellers. Our difficulty may perhaps have arisen from treating the actors as personifications instead of as individuals.
A may be clever enough to get the advantage of B or C without their being able to retaliate. A sells wine worth ? 40 to B, and obtains from him in exchange corn to the value of ? 50. A has converted his ? 40 into ? 50, has made more money out of less, and has converted his commodities into capital. Let us examine this a little more closely. Before the exchange we had ? 40 worth of wine in the hands of A, and ? 50 worth of corn in those of B, a total value of ? 90. After the exchange we have still the same total value of ? 90. The value in circulation has not increased by one iota, it is only distributed differently between A and B. What is a loss of value to B is surplus value to A; what is --minus? to one is --plus? to the other. The same change would have taken place, if A, without the formality of an exchange, had directly stolen the ? 10 from B. The sum of the values in circulation can clearly not be augmented by any change in their distribution, any more than the quantity of the precious metals in a country by a Jew selling a Queen Anne's farthing for a guinea. The capitalist class, as a whole, in any country, cannot over-reach themselves. 17
Turn and twist then as we may, the fact remains unaltered. If equivalents are exchanged, no surplus value results, and if non-equivalents are exchanged, still no surplus value. 18 Circulation, or the exchange of commodities, begets no value. 19
The reason is now therefore plain why, in analysing the standard form of capital, the form under which it determines the economic organisation of modern society, we entirely left out of consideration its most popular, and, so to say, antediluvian forms, merchants' capital and money- lenders' capital.
The circuit M-C-M, buying in order to sell dearer, is seen most clearly in genuine merchants' capital. But the movement takes place entirely within the sphere of circulation. Since, however, it is impossible, by circulation alone, to account for the conversion of money into capital, for the formation of surplus value, it would appear, that merchants' capital is an impossibility, so long as
? 113 Chapter 5
equivalents are exchanged;20 that, therefore, it can only have its origin in the two-fold advantage gained, over both the selling and the buying producers, by the merchant who parasitically shoves himself in between them. It is in this sense that Franklin says, --war is robbery, commerce is generally cheating. ? 21 If the transformation of merchants' money into capital is to be explained otherwise than by the producers being simply cheated, a long series of intermediate steps would be necessary, which, at present, when the simple circulation of commodities forms our only assumption, are entirely wanting.
What we have said with reference to merchants' capital, applies still more to money-lenders' capital. In merchants' capital, the two extremes, the money that is thrown upon the market, and the augmented money that is withdrawn from the market, are at least connected by a purchase and a sale, in other words by the movement of the circulation. In money-lenders' capital the form M-C-M is reduced to the two extremes without a mean, M-M , money exchanged for more money, a form that is incompatible with the nature of money, and therefore remains inexplicable from the standpoint of the circulation of commodities. Hence Aristotle: --since chrematistic is a double science, one part belonging to commerce, the other to economic, the latter being necessary and praiseworthy, the former based on circulation and with justice disapproved (for it is not based on Nature, but on mutual cheating), therefore the usurer is most rightly hated, because money itself is the source of his gain, and is not used for the purposes for which it was invented. For it originated for the exchange of commodities, but interest makes out of money, more money. Hence its name (? ? ? ? ? interest and offspring). For the begotten are like those who beget them. But interest is money of money, so that of all modes of making a living, this is the most contrary to Nature. ? 22
In the course of our investigation, we shall find that both merchants' capital and interest-bearing capital are derivative forms, and at the same time it will become clear, why these two forms appear in the course of history before the modern standard form of capital.
We have shown that surplus value cannot be created by circulation, and, therefore, that in its formation, something must take place in the background, which is not apparent in the circulation itself. 23 But can surplus value possibly originate anywhere else than in circulation, which is the sum total of all the mutual relations of commodity-owners, as far as they are determined by their commodities? Apart from circulation, the commodity-owner is in relation only with his own commodity. So far as regards value, that relation is limited to this, that the commodity contains a quantity of his own labour, that quantity being measured by a definite social standard. This quantity is expressed by the value of the commodity, and since the value is reckoned in money of account, this quantity is also expressed by the price, which we will suppose to be ? 10. But his labour is not represented both by the value of the commodity, and by a surplus over that value, not by a price of 10 that is also a price of 11, not by a value that is greater than itself. The commodity owner can, by his labour, create value, but not self-expanding value. He can increase the value of his commodity, by adding fresh labour, and therefore more value to the value in hand, by making, for instance, leather into boots. The same material has now more value, because it contains a greater quantity of labour. The boots have therefore more value than the leather, but the value of the leather remains what it was; it has not expanded itself, has not, during the making of the boots, annexed surplus value. It is therefore impossible that outside the sphere of circulation, a producer of commodities can, without coming into contact with other commodity- owners, expand value, and consequently convert money or commodities into capital.
? 114 Chapter 5
It is therefore impossible for capital to be produced by circulation, and it is equally impossible for it to originate apart from circulation. It must have its origin both in circulation and yet not in circulation.
We have, therefore, got a double result.
The conversion of money into capital has to be explained on the basis of the laws that regulate the exchange of commodities, in such a way that the starting-point is the exchange of equivalents. 24 Our friend, Moneybags, who as yet is only an embryo capitalist, must buy his commodities at their value, must sell them at their value, and yet at the end of the process must withdraw more value from circulation than he threw into it at starting. His development into a full-grown capitalist must take place, both within the sphere of circulation and without it. These are the conditions of the problem. Hic Rhodus, hic salta! 25
1 --L'e? change est une transaction admirable dans laquelle les deux contractants gagnent - toujours (! )? [--Exchange is a transaction in which the two contracting parties always gain, both of them (! )? ] (Destutt de Tracy: --Traite? de la Volonte? et de ses effets. ? Paris, 1826, p. 68. ) This work appeared afterwards as --Traite? d'Econ. Polit. ?
2 --Mercier de la Rivie`re,? l. c. , p. 544.
3 --Que l'une de ces deux valeurs soit argent, ou qu'elles soient toutes deux marchandises usuelles, rien de plus indiffe? rent en soi. ? [--Whether one of those two values is money, or they are both ordinary commodities, is in itself a matter of complete indifference. ? ] (--Mercier de la Rivie`re,? l. c. , p. 543. )
4 --Ce ne sont pas les contractants qui prononcent sur la valeur; elle est de? cide? e avant la convention. ? [--It is not the parties to a contract who decide on the value; that has been decided before the contract. ? ] (Le Trosne, p. 906. )
5 --Dove e` egualita` non e` lucro. ? (Galiani, --Della Moneta in Custodi, Parte Moderna,? t. iv. , p. 244. )
6 --L'e? change devient de? savantageux pour l'une des parties, lorsque quelque chose e? trange`re vient diminuer ou exage? rer le prix; alors l'e? galite? est blesse? e, mais la le? sion proce`de de cette cause et non de l'e? change. ? [--The exchange becomes unfavourable for one of the parties when some external circumstance comes to lessen or increase the price; then equality is infringed, but this infringement arises from that cause and not from the exchange itself. ? ] (Le Trosne, l. c. , p. 904. )
7 --L'e? change est de sa nature un contrat d'e? galite? qui se fait de valeur pour valeur e? gale. Il n'est donc pas un moyen de s'enrichir, puisque l'on donne autant que l'on rec? oit. ? [--Exchange is by its nature a contract which rests on equality, i. e. , it takes place between two equal values, and it is not a means of self-enrichment, since as much is given as is received. ? ] (Le Trosne, l. c. , p. 903. )
8 Condillac: --Le Commerce et le Gouvernement? (1776). Edit. Daire et Molinari in the --Me? langes d'Econ. Polit. ? Paris, 1847, pp. 267, 291.
9 Le Trosne, therefore, answers his friend Condillac with justice as follows: --Dans une . . . socie? te? forme? e il n'y a pas de surabondant en aucun genre. ? [--In a developed society absolutely nothing is superfluous. ? ] At the same time, in a bantering way, he remarks: --If both the persons who exchange receive more to an equal amount, and part with less to an equal amount, they both get the same. ?
It is because Condillac has not the remotest idea of the nature of exchange-value that he has been chosen by Herr Professor Wilhelm Roscher as a proper person to answer for the soundness of his own childish notions. See Roscher's --Die Grundlagen der Nationalo? konomie, Dritte Auflage,? 1858.
10 S. P. Newman: --Elements of Polit. Econ. ? Andover and New York, 1835, p. 175.
11 --By the augmentation of the nominal value of the produce. . . sellers not enriched. . . since what they gain as sellers, they precisely expend in the quality of buyers. ? (--The Essential Principles of the Wealth of Nations. ? &c. , London, 1797, p. 66. )
? ? 115 Chapter 5
12 --Si l'on est force? de donner pour 18 livres une quantite? de telle production qui en valait 24, lorsqu'on employera ce me^me argent a` acheter, on aura e? galement pour 18 l. ce que l'on payait 24. ? [--If one is compelled to sell a quantity of a certain product for 18 livres when it has a value of 24 livres, when one employs the same amount of money in buying, one will receive for 18 livres the same quantity of the product as 24 livres would have bought otherwise. ? ] (Le Trosne, I. c. , p. 897. )
13 --Chaque vendeur ne peut donc parvenir a` renche? rir habituellement ses marchandises, qu'en se soumettant aussi a` payer habituellement plus cher les marchandises des autres vendeurs; et par la me^me raison, chaque consommateur ne peut payer habituellement moins cher ce qu'il ache`te, qu'en se soumettant aussi a` une diminution semblable sur le prix des choses qu'il vend. ? [--A seller can normally only succeed in raising the prices of his commodities if he agrees to pay, by and large, more for the commodities of the other sellers; and for the same reason a consumer can normally only pay less for his purchases if he submits to a similar reduction in the prices of the things he sells. ? ] (Mercier de la Rivie`re, l. c. , p. 555. )
14 Torrens. --An Essay on the Production of Wealth. ? London, 1821, p. 349.
15 The idea of profits being paid by the consumers, is, assuredly, very absurd. Who are the consumers? ? (G. Ramsay: --An Essay on the Distribution of Wealth. ? Edinburgh, 1836, p. 183. )
16 --When a man is in want of a demand, does Mr. Malthus recommend him to pay some other person to take off his goods? ? is a question put by an angry disciple of Ricardo to Malthus, who, like his disciple, Parson Chalmers, economically glorifies this class of simple buyers or consumers. (See --An Inquiry into those Principles Respecting the Nature of Demand and the Necessity of Consumption, lately advocated by Mr. Malthus,? &c. Lond. , 1821, p. 55. )
17 Destutt de Tracy, although, or perhaps because, he was a member of the Institute, held the opposite view. He says, industrial capitalists make profits because --they all sell for more than it has cost to produce. And to whom do they sell? In the first instance to one another. ? (I. c. , p. 239. )
18 --L'e? change qui se fait de deux valeurs e? gales n'augmente ni ne diminue la masse des valeurs subsistantes dans la socie? te? . L'e? change de deux valeurs ine? gales . . . ne change rien non plus a` la somme des valeurs sociales, bien qu'il ajoute a` la fortune de l'un ce qu'il o^te de la fortune de l'autre. ? [--The exchange of two equal values neither increases nor diminishes the amount of the values available in society. Nor does the exchange of two unequal values . . . change anything in the sum of social values, although it adds to the wealth of one person what ir removes fomr the wealth of another. ? ] (J. B. Say, l. c. , t. II, pp. 443, 444. ) Say, not in the least troubled as to the consequences of this statement, borrows it, almost word for word, from the Physiocrats. The following example will show how Monsieur Say turned to account the writings of the Physiocrats, in his day quite forgotten, for the purpose of expanding the --value? of his own. His most celebrated saying, --On n'ache`te des produits qu'avec des produits? [--Products can only be bought with products. ? ](l. c. , t. II. p. 441. ) runs as follows in the original physiocratic work: --Les productions ne se paient qu'avec des productions. ? [--Products can only be paid for with products. ? ] (Le Trosne, l. c. , p. 899. )
19 --Exchange confers no value at all upon products. ? (F. Wayland: --The Elements of Political Economy. ? Boston, 1843, p. 169. )
20 Under the rule of invariable equivalents commerce would be impossible. (G. Opdyke: --A Treatise on Polit. Economy. ? New York, 1851, pp. 66-69. ) --The difference between real value and exchange- value is based upon this fact, namely, that the value of a thing is different from the so-called equivalent given for it in trade, i. e. , that this equivalent is no equivalent. ? (F. Engels, l. c. , p. 96).
21 Benjamin Franklin: Works, Vol. II, edit. Sparks in --Positions to be examined concerning National Wealth,? p. 376.
22 Aristotle, I. c. , c. 10.
? ? 116 Chapter 5
23 --Profit, in the usual condition of the market, is not made by exchanging. Had it not existed before, neither could it after that transaction. ? (Ramsay, l. c. , p. 184. )
24 From the foregoing investigation, the reader will see that this statement only means that the formation of capital must be possible even though the price and value of a commodity be the same; for its formation cannot be attributed to any deviation of the one from the other. If prices actually differ from values, we must, first of all, reduce the former to the latter, in other words, treat the difference as accidental in order that the phenomena may be observed in their purity, and our observations not interfered with by disturbing circumstances that have nothing to do with the process in question. We know, moreover, that this reduction is no mere scientific process. The continual oscillations in prices, their rising and falling, compensate each other, and reduce themselves to an average price, which is their hidden regulator. It forms the guiding star of the merchant or the manufacturer in every undertaking that requires time. He knows that when a long period of time is taken, commodities are sold neither over nor under, but at their average price. If therefore he thought about the matter at all, he would formulate the problem of the formation of capital as follows: How can we account for the origin of capital on the supposition that prices are regulated by the average price, i. e. , ultimately by the value of the commodities? I say --ultimately,? because average prices do not directly coincide with the values of commodities, as Adam Smith, Ricardo, and others believe.
25 --Hic Rhodus, hic saltus! ? - Latin, usually translated: --Rhodes is here, here is where you jump! ?
Originates from the traditional Latin translation of the punch line from Aesop's fable The Boastful Athlete which has been the subject of some mistranslations. In Greek, the maxim reads:
--? ? ? ? ? ? ? ? ? ? ? ? ,
? ? ? ? ? ? ? ?
The creation of surplus value, and therefore the conversion of money into capital, can consequently be explained neither on the assumption that commodities are sold above their value, nor that they are bought below their value. 13
The problem is in no way simplified by introducing irrelevant matters after the manner of Col. Torrens: --Effectual demand consists in the power and inclination (! ), on the part of consumers, to give for commodities, either by immediate or circuitous barter, some greater portion of . . . capital than their production costs. ? 14 In relation to circulation, producers and consumers meet only as buyers and sellers. To assert that the surplus value acquired by the producer has its origin in the
? 112 Chapter 5
fact that consumers pay for commodities more than their value, is only to say in other words: The owner of commodities possesses, as a seller, the privilege of selling too dear. The seller has himself produced the commodities or represents their producer, but the buyer has to no less extent produced the commodities represented by his money, or represents their producer. The distinction between them is, that one buys and the other sells. The fact that the owner of the commodities, under the designation of producer, sells them over their value, and under the designation of consumer, pays too much for them, does not carry us a single step further. 15
To be consistent therefore, the upholders of the delusion that surplus value has its origin in a nominal rise of prices or in the privilege which the seller has of selling too dear, must assume the existence of a class that only buys and does not sell, i. e. , only consumes and does not produce. The existence of such a class is inexplicable from the standpoint we have so far reached, viz. , that of simple circulation. But let us anticipate. The money with which such a class is constantly making purchases, must constantly flow into their pockets, without any exchange, gratis, by might or right, from the pockets of the commodity-owners themselves. To sell commodities above their value to such a class, is only to crib back again a part of the money previously given to it. 16 The towns of Asia Minor thus paid a yearly money tribute to ancient Rome. With this money Rome purchased from them commodities, and purchased them too dear. The provincials cheated the Romans, and thus got back from their conquerors, in the course of trade, a portion of the tribute. Yet, for all that, the conquered were the really cheated. Their goods were still paid for with their own money. That is not the way to get rich or to create surplus value.
Let us therefore keep within the bounds of exchange where sellers are also buyers, and buyers, sellers. Our difficulty may perhaps have arisen from treating the actors as personifications instead of as individuals.
A may be clever enough to get the advantage of B or C without their being able to retaliate. A sells wine worth ? 40 to B, and obtains from him in exchange corn to the value of ? 50. A has converted his ? 40 into ? 50, has made more money out of less, and has converted his commodities into capital. Let us examine this a little more closely. Before the exchange we had ? 40 worth of wine in the hands of A, and ? 50 worth of corn in those of B, a total value of ? 90. After the exchange we have still the same total value of ? 90. The value in circulation has not increased by one iota, it is only distributed differently between A and B. What is a loss of value to B is surplus value to A; what is --minus? to one is --plus? to the other. The same change would have taken place, if A, without the formality of an exchange, had directly stolen the ? 10 from B. The sum of the values in circulation can clearly not be augmented by any change in their distribution, any more than the quantity of the precious metals in a country by a Jew selling a Queen Anne's farthing for a guinea. The capitalist class, as a whole, in any country, cannot over-reach themselves. 17
Turn and twist then as we may, the fact remains unaltered. If equivalents are exchanged, no surplus value results, and if non-equivalents are exchanged, still no surplus value. 18 Circulation, or the exchange of commodities, begets no value. 19
The reason is now therefore plain why, in analysing the standard form of capital, the form under which it determines the economic organisation of modern society, we entirely left out of consideration its most popular, and, so to say, antediluvian forms, merchants' capital and money- lenders' capital.
The circuit M-C-M, buying in order to sell dearer, is seen most clearly in genuine merchants' capital. But the movement takes place entirely within the sphere of circulation. Since, however, it is impossible, by circulation alone, to account for the conversion of money into capital, for the formation of surplus value, it would appear, that merchants' capital is an impossibility, so long as
? 113 Chapter 5
equivalents are exchanged;20 that, therefore, it can only have its origin in the two-fold advantage gained, over both the selling and the buying producers, by the merchant who parasitically shoves himself in between them. It is in this sense that Franklin says, --war is robbery, commerce is generally cheating. ? 21 If the transformation of merchants' money into capital is to be explained otherwise than by the producers being simply cheated, a long series of intermediate steps would be necessary, which, at present, when the simple circulation of commodities forms our only assumption, are entirely wanting.
What we have said with reference to merchants' capital, applies still more to money-lenders' capital. In merchants' capital, the two extremes, the money that is thrown upon the market, and the augmented money that is withdrawn from the market, are at least connected by a purchase and a sale, in other words by the movement of the circulation. In money-lenders' capital the form M-C-M is reduced to the two extremes without a mean, M-M , money exchanged for more money, a form that is incompatible with the nature of money, and therefore remains inexplicable from the standpoint of the circulation of commodities. Hence Aristotle: --since chrematistic is a double science, one part belonging to commerce, the other to economic, the latter being necessary and praiseworthy, the former based on circulation and with justice disapproved (for it is not based on Nature, but on mutual cheating), therefore the usurer is most rightly hated, because money itself is the source of his gain, and is not used for the purposes for which it was invented. For it originated for the exchange of commodities, but interest makes out of money, more money. Hence its name (? ? ? ? ? interest and offspring). For the begotten are like those who beget them. But interest is money of money, so that of all modes of making a living, this is the most contrary to Nature. ? 22
In the course of our investigation, we shall find that both merchants' capital and interest-bearing capital are derivative forms, and at the same time it will become clear, why these two forms appear in the course of history before the modern standard form of capital.
We have shown that surplus value cannot be created by circulation, and, therefore, that in its formation, something must take place in the background, which is not apparent in the circulation itself. 23 But can surplus value possibly originate anywhere else than in circulation, which is the sum total of all the mutual relations of commodity-owners, as far as they are determined by their commodities? Apart from circulation, the commodity-owner is in relation only with his own commodity. So far as regards value, that relation is limited to this, that the commodity contains a quantity of his own labour, that quantity being measured by a definite social standard. This quantity is expressed by the value of the commodity, and since the value is reckoned in money of account, this quantity is also expressed by the price, which we will suppose to be ? 10. But his labour is not represented both by the value of the commodity, and by a surplus over that value, not by a price of 10 that is also a price of 11, not by a value that is greater than itself. The commodity owner can, by his labour, create value, but not self-expanding value. He can increase the value of his commodity, by adding fresh labour, and therefore more value to the value in hand, by making, for instance, leather into boots. The same material has now more value, because it contains a greater quantity of labour. The boots have therefore more value than the leather, but the value of the leather remains what it was; it has not expanded itself, has not, during the making of the boots, annexed surplus value. It is therefore impossible that outside the sphere of circulation, a producer of commodities can, without coming into contact with other commodity- owners, expand value, and consequently convert money or commodities into capital.
? 114 Chapter 5
It is therefore impossible for capital to be produced by circulation, and it is equally impossible for it to originate apart from circulation. It must have its origin both in circulation and yet not in circulation.
We have, therefore, got a double result.
The conversion of money into capital has to be explained on the basis of the laws that regulate the exchange of commodities, in such a way that the starting-point is the exchange of equivalents. 24 Our friend, Moneybags, who as yet is only an embryo capitalist, must buy his commodities at their value, must sell them at their value, and yet at the end of the process must withdraw more value from circulation than he threw into it at starting. His development into a full-grown capitalist must take place, both within the sphere of circulation and without it. These are the conditions of the problem. Hic Rhodus, hic salta! 25
1 --L'e? change est une transaction admirable dans laquelle les deux contractants gagnent - toujours (! )? [--Exchange is a transaction in which the two contracting parties always gain, both of them (! )? ] (Destutt de Tracy: --Traite? de la Volonte? et de ses effets. ? Paris, 1826, p. 68. ) This work appeared afterwards as --Traite? d'Econ. Polit. ?
2 --Mercier de la Rivie`re,? l. c. , p. 544.
3 --Que l'une de ces deux valeurs soit argent, ou qu'elles soient toutes deux marchandises usuelles, rien de plus indiffe? rent en soi. ? [--Whether one of those two values is money, or they are both ordinary commodities, is in itself a matter of complete indifference. ? ] (--Mercier de la Rivie`re,? l. c. , p. 543. )
4 --Ce ne sont pas les contractants qui prononcent sur la valeur; elle est de? cide? e avant la convention. ? [--It is not the parties to a contract who decide on the value; that has been decided before the contract. ? ] (Le Trosne, p. 906. )
5 --Dove e` egualita` non e` lucro. ? (Galiani, --Della Moneta in Custodi, Parte Moderna,? t. iv. , p. 244. )
6 --L'e? change devient de? savantageux pour l'une des parties, lorsque quelque chose e? trange`re vient diminuer ou exage? rer le prix; alors l'e? galite? est blesse? e, mais la le? sion proce`de de cette cause et non de l'e? change. ? [--The exchange becomes unfavourable for one of the parties when some external circumstance comes to lessen or increase the price; then equality is infringed, but this infringement arises from that cause and not from the exchange itself. ? ] (Le Trosne, l. c. , p. 904. )
7 --L'e? change est de sa nature un contrat d'e? galite? qui se fait de valeur pour valeur e? gale. Il n'est donc pas un moyen de s'enrichir, puisque l'on donne autant que l'on rec? oit. ? [--Exchange is by its nature a contract which rests on equality, i. e. , it takes place between two equal values, and it is not a means of self-enrichment, since as much is given as is received. ? ] (Le Trosne, l. c. , p. 903. )
8 Condillac: --Le Commerce et le Gouvernement? (1776). Edit. Daire et Molinari in the --Me? langes d'Econ. Polit. ? Paris, 1847, pp. 267, 291.
9 Le Trosne, therefore, answers his friend Condillac with justice as follows: --Dans une . . . socie? te? forme? e il n'y a pas de surabondant en aucun genre. ? [--In a developed society absolutely nothing is superfluous. ? ] At the same time, in a bantering way, he remarks: --If both the persons who exchange receive more to an equal amount, and part with less to an equal amount, they both get the same. ?
It is because Condillac has not the remotest idea of the nature of exchange-value that he has been chosen by Herr Professor Wilhelm Roscher as a proper person to answer for the soundness of his own childish notions. See Roscher's --Die Grundlagen der Nationalo? konomie, Dritte Auflage,? 1858.
10 S. P. Newman: --Elements of Polit. Econ. ? Andover and New York, 1835, p. 175.
11 --By the augmentation of the nominal value of the produce. . . sellers not enriched. . . since what they gain as sellers, they precisely expend in the quality of buyers. ? (--The Essential Principles of the Wealth of Nations. ? &c. , London, 1797, p. 66. )
? ? 115 Chapter 5
12 --Si l'on est force? de donner pour 18 livres une quantite? de telle production qui en valait 24, lorsqu'on employera ce me^me argent a` acheter, on aura e? galement pour 18 l. ce que l'on payait 24. ? [--If one is compelled to sell a quantity of a certain product for 18 livres when it has a value of 24 livres, when one employs the same amount of money in buying, one will receive for 18 livres the same quantity of the product as 24 livres would have bought otherwise. ? ] (Le Trosne, I. c. , p. 897. )
13 --Chaque vendeur ne peut donc parvenir a` renche? rir habituellement ses marchandises, qu'en se soumettant aussi a` payer habituellement plus cher les marchandises des autres vendeurs; et par la me^me raison, chaque consommateur ne peut payer habituellement moins cher ce qu'il ache`te, qu'en se soumettant aussi a` une diminution semblable sur le prix des choses qu'il vend. ? [--A seller can normally only succeed in raising the prices of his commodities if he agrees to pay, by and large, more for the commodities of the other sellers; and for the same reason a consumer can normally only pay less for his purchases if he submits to a similar reduction in the prices of the things he sells. ? ] (Mercier de la Rivie`re, l. c. , p. 555. )
14 Torrens. --An Essay on the Production of Wealth. ? London, 1821, p. 349.
15 The idea of profits being paid by the consumers, is, assuredly, very absurd. Who are the consumers? ? (G. Ramsay: --An Essay on the Distribution of Wealth. ? Edinburgh, 1836, p. 183. )
16 --When a man is in want of a demand, does Mr. Malthus recommend him to pay some other person to take off his goods? ? is a question put by an angry disciple of Ricardo to Malthus, who, like his disciple, Parson Chalmers, economically glorifies this class of simple buyers or consumers. (See --An Inquiry into those Principles Respecting the Nature of Demand and the Necessity of Consumption, lately advocated by Mr. Malthus,? &c. Lond. , 1821, p. 55. )
17 Destutt de Tracy, although, or perhaps because, he was a member of the Institute, held the opposite view. He says, industrial capitalists make profits because --they all sell for more than it has cost to produce. And to whom do they sell? In the first instance to one another. ? (I. c. , p. 239. )
18 --L'e? change qui se fait de deux valeurs e? gales n'augmente ni ne diminue la masse des valeurs subsistantes dans la socie? te? . L'e? change de deux valeurs ine? gales . . . ne change rien non plus a` la somme des valeurs sociales, bien qu'il ajoute a` la fortune de l'un ce qu'il o^te de la fortune de l'autre. ? [--The exchange of two equal values neither increases nor diminishes the amount of the values available in society. Nor does the exchange of two unequal values . . . change anything in the sum of social values, although it adds to the wealth of one person what ir removes fomr the wealth of another. ? ] (J. B. Say, l. c. , t. II, pp. 443, 444. ) Say, not in the least troubled as to the consequences of this statement, borrows it, almost word for word, from the Physiocrats. The following example will show how Monsieur Say turned to account the writings of the Physiocrats, in his day quite forgotten, for the purpose of expanding the --value? of his own. His most celebrated saying, --On n'ache`te des produits qu'avec des produits? [--Products can only be bought with products. ? ](l. c. , t. II. p. 441. ) runs as follows in the original physiocratic work: --Les productions ne se paient qu'avec des productions. ? [--Products can only be paid for with products. ? ] (Le Trosne, l. c. , p. 899. )
19 --Exchange confers no value at all upon products. ? (F. Wayland: --The Elements of Political Economy. ? Boston, 1843, p. 169. )
20 Under the rule of invariable equivalents commerce would be impossible. (G. Opdyke: --A Treatise on Polit. Economy. ? New York, 1851, pp. 66-69. ) --The difference between real value and exchange- value is based upon this fact, namely, that the value of a thing is different from the so-called equivalent given for it in trade, i. e. , that this equivalent is no equivalent. ? (F. Engels, l. c. , p. 96).
21 Benjamin Franklin: Works, Vol. II, edit. Sparks in --Positions to be examined concerning National Wealth,? p. 376.
22 Aristotle, I. c. , c. 10.
? ? 116 Chapter 5
23 --Profit, in the usual condition of the market, is not made by exchanging. Had it not existed before, neither could it after that transaction. ? (Ramsay, l. c. , p. 184. )
24 From the foregoing investigation, the reader will see that this statement only means that the formation of capital must be possible even though the price and value of a commodity be the same; for its formation cannot be attributed to any deviation of the one from the other. If prices actually differ from values, we must, first of all, reduce the former to the latter, in other words, treat the difference as accidental in order that the phenomena may be observed in their purity, and our observations not interfered with by disturbing circumstances that have nothing to do with the process in question. We know, moreover, that this reduction is no mere scientific process. The continual oscillations in prices, their rising and falling, compensate each other, and reduce themselves to an average price, which is their hidden regulator. It forms the guiding star of the merchant or the manufacturer in every undertaking that requires time. He knows that when a long period of time is taken, commodities are sold neither over nor under, but at their average price. If therefore he thought about the matter at all, he would formulate the problem of the formation of capital as follows: How can we account for the origin of capital on the supposition that prices are regulated by the average price, i. e. , ultimately by the value of the commodities? I say --ultimately,? because average prices do not directly coincide with the values of commodities, as Adam Smith, Ricardo, and others believe.
25 --Hic Rhodus, hic saltus! ? - Latin, usually translated: --Rhodes is here, here is where you jump! ?
Originates from the traditional Latin translation of the punch line from Aesop's fable The Boastful Athlete which has been the subject of some mistranslations. In Greek, the maxim reads:
--? ? ? ? ? ? ? ? ? ? ? ? ,
? ? ? ? ? ? ? ?
