Study 6 : Organization of Economic Forces
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Rousseau said truly: No one should obey a law to which he has not consented; and M. Rittinghausen too was right when he proved that in consequence the law should emanate directly from the sovereign, without the intermediary of representatives.
But it was in the application that both these writers failed. With suffrage, or the universal vote, it is evident that the law is neither direct nor personal, any more than collective. The law of the majority is not my law, it is the law of force; hence the government based upon it is not my government; it is government by force.
That I may remain free; that I may not have to submit to any law but my own, and that I may govern myself, the authority of the suffrage must be renounced: we must give up the vote, as well as representation and monarchy. In a word, everything in the government of society which rests on the divine must be suppressed, and the whole rebuilt upon the human idea of contract.
When I agree with one or more of my fellow citizens for any object whatever, it is clear that my own will is my law; it is I myself, who, in fulfilling my obligation, am my own government.
Therefore if I could make a contract with all, as I can with some; if all could renew it among themselves, if each group of citizens, as a town, county, province, corporation, company, &c., formed by a like contract, and considered as a moral person, could thereafter, and always by a similar contract, agree with every and all other groups, it would be the same as if my own will were multiplied to infinity. I should be sure that the law thus made on all questions in the Republic, from millions of different initiatives, would never be anything but my law; and if this new order of things were called government, it would be my government.
Thus the principle of contract, far more than that of authority, would bring about the union of producers, centralize their forces, and assure the unity and solidarity of their interests.
The system of contracts, substituted for the system of laws, would constitute the true government of the man and of the citizen; the true sovereignty of the people, the republic.
For the contract is Liberty, the first term of the republican motto: we have demonstrated this superabundantly in our studies on the principle of authority and on social liquidation. I am not free when I depend upon another for my work, my wages, or the measure of my rights and duties; whether that other be called the Majority or Society. No more am I free, either in my sovereignty or in my action, when I am compelled by another to revise my law, were that other the most skillful and most just of arbiters. I am no more at all free when I am forced to give myself a representative to govern me, even if he were my most devoted servant.
The Contract is Equality, in its profound and spiritual essence.—Does this man believe himself my equal; does he not take the attitude of my master and exploiter, who demands from me more than it suits me to furnish, and has no intention of returning it to me; who says that I am incapable of making my own law, and expects me to submit to his?
The contract is Fraternity, because it identifies all interests, unifies all divergences, resolves all contradictions, and in consequence, give wings to the feelings of goodwill and kindness, which are crushed by economic chaos, the government of representatives, alien law.
The contract, finally, is order, since it is the organization of economic forces, instead of the alienation of liberties, the sacrifice of rights, the subordination of wills.
Let us give an idea of this organism; after liquidation, reconstruction; after the thesis and antithesis, the synthesis.
The organization of credit is three-quarters done by the winding up of the privileged and usurious banks, and their conversion into a National Bank of circulation and loan, at ½, ¼, or ⅛ per cent. It remains only to establish branches of the Bank, wherever necessary, and to gradually retire specie from circulation, depriving gold and silver of their privilege as money.
As for personal credit, it is not for the National Bank to have to do with it; it is with the workingmen’s unions, and the farming and industrial societies, that personal credit should be exercised.
I have shown above how property, repurchased by the house rent or ground rent, would come back to the tenant farmer and house tenant. It remains for me to show, especially in relation to property in land, the organizing power of the principle which we have invoked to bring about this conversion.
Either the laborer is simply a workman associate of a great farming association, called the Commune, or the Phalanstery;
Or each cultivator becomes a tenant of the State, which is the only proprietor, the only landlord; all land having been taken by it. In this case, the ground rent becomes part of the taxes, and may replace them entirely.
The first of these two systems is governmental and Communist at the same time: through this double principle it has no chance of success. It is a utopian conception still-born. The Phalansterians will talk for a good while yet of their model community: the Communists are not ready to give up their rural fraternity. They may have this consolation. If the idea of a farming association or of cultivation by the government were ever brought forward as a serious proposal during the Revolution, supposing that a government could still exist in a revolution directed chiefly against itself, the chances of insurrection would be laid before the peasant. There would be the menace of tyranny for him, even from those who called themselves Socialists.
The second system seems more liberal: it leaves the cultivator his own master in his work, subjects him to no orders, imposes upon him no rules. In comparison with the present lot of farmers, it is probable that, with the greater length of leases and moderation of rents, the establishment of this system would encounter little opposition in the country. I admit, for my part, that I hesitated for a long time over this idea, which grants some liberty, and which I could reproach with no injustice.
Nevertheless I have never been completely satisfied with it. I find in it always a character of governmental autocracy which is disagreeable to me: I see in it a barrier to liberty of transactions and of inheritances; the free disposition of the soil taken away from him who cultivates it; and this precious sovereignty, this eminent domain, as the lawyers say, forbidden to the citizen, and reserved for that fictitious being, without intelligence, without passion, without morality, that we call the State. By this arrangement, the occupant has less to do with the soil than before; the clod of earth seems to stand up and say to him: You are only a slave of the taxes; I do not know you!
But why should the rural laborer, the most ancient, the most noble of all, be thus discrowned? The peasant loves the land with a love without limit; as Michelet poetically says: he does not want a tenancy, a concubinage; he wants a marriage.
It is asserted that mankind, as a race, has an anterior, imperscriptible, inalienable right to the soil. It is thence deduced, as by the Physiocrats formerly, that the City or the Country should share in the economic rent. It is said that this economic rent should be taken in taxes. And from all this results the enfeoffment of the land by perpetual, unchangeable tenancy; and, what is more serious, the non-circulation, the immobility, of a whole class of capital, the largest in volume, and the most valuable, through its security.
This doctrine appears to me fatal; opposed to all the teachings of science, and of dangerous tenancy.
What is called economic rent in agriculture has no other cause than the inequality in the quality of the land: without this inequality there would be no economic rent, since there would be no means of comparison. Therefore if anybody has a claim on account of this inequality, it is not the State, but the other land workers who hold inferior land. That is why in our scheme for liquidation we stipulated that every variety of cultivation should pay a proportional contribution, destined to accomplish a balancing of returns among farm workers, and an assurance of products.
The industrial occupations, in favor of which the ground rent seems to be reserved, have no more right to it than the State, for the reason that they do not exist apart from agricultural work and independently of it: they are a subdivision of it. The farm worker cultivates and harvests for all: the artisan, the merchant, the manufacturer, work for the farm worker. As soon as the dealer has received the price of his merchandise, he is paid his share of the economic rent, as well as of the gross product of the soil; his account is settled. To make the farm worker only pay the taxes, under the pretext that they are economic rent, would be to exempt other industries from taxation, to their profit, and to permit them to receive the whole of the rent, without reciprocity on their part.
As for the drawbacks in non-circulation of real estate, I shall show how serious they are before long.
Finally, this universal, absolute, irrevocable farm tenantry, so opposed to the clearest hopes of the times, seems to me, in the present juncture, supremely impolitic. The people, even those who are Socialists, whatever they may say, want to be owners; and, if I may offer myself as a witness, I can say that, after ten years of careful examination, I find the feelings of the masses on this point stronger and more resistant than on any other question. I have succeeded in shaking their opinions, but have made no impression on their sentiments. And one thing is to be noted which shows how far, in the minds of the people, individual sovereignty is identified with collective sovereignty, that the more ground the principles of democracy have gained, the more I have seen the working classes, both in the city and country, interpret these principles favorably to individual ownership.
Therefore while maintaining my criticism, upon the aim of which no one can hereafter misunderstand me, I have been obliged to conclude that the hypothesis of general farm tenancy did not contain the solution that I sought; and that, after having settled for the land, it would be necessary to seriously consider reassigning it in full sovereignty to the worker, because, without that, neither his pride as a citizen nor his rights as a producer could be satisfied.
This important solution, without which nothing stable can be produced in society, I believe I have found; and, as always, as much more simple, more practical, and more fruitful, as it was nearer at hand: it is none other than the principle which has served us for liquidation, transformed into the principle of acquisition.
Every payment of house rent or farm rent, we have said,
acquires for the house tenant, farmer or peasant a proportional share in ownership.
Make of this idea, apparently quite negative, and which at first seemed a mere fancy, for the need of the cause—make of it a positive, general, fixed rule, and property becomes constituted. It will receive its organization, its rules, its police, its sanction. It will have fulfilled the Idea beneath it, its charter for all and accepted by all, in a single clause; whence all the rest is deducible by the light of common sense.
With this simple contract, protected, consolidated and guaranteed by the commercial and agricultural association, you may, without the slightest apprehension, permit the proprietor to sell, transmit, alienate, circulate, his property at will. Property in land, under this new system, property deprived of rent, delivered from its chains and cured of its leprosy, is in the hands of the proprietor like a five franc piece or a bank note in the hands of the bearer. It is worth so much, neither more nor less, it can neither gain nor lose in value by changing hands; it is no longer subject to depreciation; above all, it has lost that fatal power of accumulation which it had, not in itself, but through the ancient prejudice in favor of caste and nobility which attached to it.
Thus from the point of view of equality of conditions, of the guaranty of labor and of public security, property in land cannot cause the slightest perturbation to social economy: it has lost its vicious character; there remain to be seen the good qualities which it must have acquired. It is to this that I call the attention of my readers, notably of the Communist, whom I beg to weigh well the difference between association, that is to say, government, and contract.
If landed property should come back to the State, as some propose, and should consequently become fixed in the hands of the State, leaving the cultivators either associated or tenant farmers, it would come about that property would disappear, not merely as a right, as a legal principle, but as a value.
Suppose that, as things are, the Government should order a complete inventory of all the wealth of the country, both personal and real. After having taken into account the money, the merchandise in store, the standing crops, furniture, tools, houses and shops, there would be added the land, what is commonly called property. And we would say: The land is worth 16 billion dollars, which, added to 10 billions of products, merchandise, &c., makes a total of 26 billions.
With the system of universal tenantship, on the contrary, these 16 billions of value in land would have to be entirely cut off from the inventory; since, being neither sold nor exchanged, entering into comparison with no other value, belonging to everybody, that is to say, to nobody, they could not, under any classification, any more than the air and the sunlight, enter into the wealth of the nation.
It will perhaps be said that this is only a bookkeeper’s artifice; that it does not affect the real wealth of the country, the positive prosperity of the people. A mistake: the people have lost 16 billions, because they have lost the right to dispose of it. In fact, according to the declaration of ’93, property is the power of free disposition. Property, or the power of free disposition, in a man, is precisely what we call value in a thing; so that he who loses either one, loses both: this is according to the usual practice. Follow this thread carefully.
According to the Constitution of 1848, which in its turn confirmed the right of property, deriving it from labor, he who clears a field, encloses it, tills it, enriches it, buries in it his sweat, his blood, his soul, has not only the right to the crop, which is his already; he has earned in addition a field, a value, which constitutes for him an additional reward, which he counts among his possessions, and calls his property. This property he can exchange or sell, and obtain for it a price, according to its importance, on which he may live, without labor, for several years.
Corresponding with this practice, consecrated by all our constitutions, we have laid down a similar rule in the authority granted to our Land Bank:
Every payment of house rent or farm rent acquires for the tenant a proportional part of the property.
Suppose then that the farmer, profiting by the advantage conferred upon him by the revolution, has acquired by twenty years of rent payments a property worth $4000, do you think that he would find it the same thing to be able to say, under a Communistic governmental system: The Revolution gives me a longer lease and lower rent, it is true. But it permits me to acquire nothing. I shall never own this land: naked I came to it, and naked I shall leave it. And as my trade is to hoe the soil, and I cannot do anything else, my condition is incapable of change; here I am fixed for life and for the life of my children, attached to the soil. Thus have our rulers willed, our rulers, whom we have chosen to make laws for us, who represent and govern us.
Or under the same of reciprocal contract:
The Revolution has freed me from rent. Each year that I pay rent purchases a part of this farm for me; in twenty years the property will be mine. In twenty years, I, who have nothing, I, who never expected to have anything, I, who would have died without leaving my children anything but the memory of my weariness and my resignation, in twenty years I shall be the owner of this farm, which is worth $4000. I shall be its master, its proprietor! I shall sell it, if I choose, for gold, or for silver, or for bank notes: I shall move to another part of the country if I choose; I shall make my son a merchant if commerce suits him; I shall marry my daughter to a teacher if she likes, and, as for myself, when I am old and unable to work, I shall buy for myself an annuity. My property is my refuge in my old age.
Do you think, I ask, that the peasant would hesitate an instant which to choose?
No doubt the collective wealth of the nation neither gains nor loses in either case: what matters it to society whether the 16 billions of real estate which constitute individual fortunes are included or not in the total? But for the farmer, in whose hands the soil is mobilized, and becomes a circulating value, a sort of money, as it were, I ask again, is it the same thing?
What I say is to no other end than to form opinion, and to prevent ruinous experiments, as far as in me lies. As for the outcome, it will be such in its last result as I have outlined: the greatest of powers, the necessity of things, in harmony with the human heart, have so willed. The farmer who did not recognize any other proprietor than the State, would soon put himself in the place of the State: he would treat his possessions as a real proprietor. He would establish among farm workers for the transmission of farms the same usage that prevails among notaries, clerks, &c., for the sale of offices; and, as the peasants in France will always be the strongest, they will soon have consecrated, by their powerful decree, what it pleases Utopians to call an usurpation.
Let us then anticipate the unavoidable solution, which the interest of the country, the preservation of the soil, the equilibrium of fortunes, and the liberty of transfer call for; and financial reform points to and demands. It is ridiculous to want to subject masses of men, under the name of individual sovereignty, to laws repugnant to their instincts; on the contrary, it is just and really revolutionary to propose to them what appeals to their self-regard, what they can acclaim with enthusiasm. The self-regard of the people in political matters is the first law.
Let the Assembly of 1852, whether Constituent or Legislative, make a beginning: let it put a stop to farm rent, and at the same time to this absurd small parceling which is a disaster for public welfare: let it profit by the general liquidation of the land to recompense inheritances, and prevent their dissipation hereafter. With facility of purchase by annual payments, the value of real estate may be indefinitely divided, without ever cutting up the land. The rest is a matter of detail, we need not concern ourselves about it.
In France, two-thirds of the inhabitants are interested in land owning; and even this proportion must increase. Next to credit, which controls everything, it is the greatest of our economic forces; through it, therefore, we must proceed to the revolutionary organization in the second place.
Agricultural labor, resting on this basis, appears in its natural dignity. Of all occupations it is the most noble, the most healthful, from the point of view of morals and health, and as intellectual exercise, the most encyclopedic. From all these considerations, agricultural labor is the one which least requires the societary form; we may say even more strongly, which most energetically rejects it. Never have peasants been seen to form a society for the cultivation of their fields; never will they be seen to do so. The only relations of unity and solidarity which can exist among farm workers, the only centralization of which rural industry is susceptible, is that which we have pointed out which results from compensation for economic rent, mutual insurance, and, most of all, from abolishing rent, which makes accumulation of land, parceling out of the soil, serfdom of the peasant, dissipation of inheritances, forever impossible.
It is otherwise with certain industries, which require the combined employment of a large number of workers, a vast array of machines and hands, and, to make use of a technical expression, a great division of labor, and in consequence a high concentration of power. In such cases, workman is necessarily subordinate to workman, man dependent on man. The producer is no longer, as in the fields, a sovereign and free father of a family; it is a collectivity. Railroads, mines, factories, are examples.
In such cases, it is one of two things; either the workman, necessarily a piece-worker, will be simply the employee of the proprietor-capitalist-promoter; or he will participate in the chances of loss or gain of the establishment, he will have a voice in the council, in a word, he will become an associate.
In the first case the workman is subordinated, exploited: his permanent condition is one of obedience and poverty. In the second case he resumes his dignity as a man and citizen, he may aspire to comfort, he forms a part of the producing organization, of which he was before but the slave; as, in the town, he forms a part of the sovereign power, of which he was before but the subject.
Thus we need not hesitate, for we have no choice. In cases in which production requires great division of labor, and a considerable collective force, it is necessary to form an association among the workers in this industry; because without that, they would remain related as subordinates and superiors, and there would ensue two industrial castes of masters and wage-workers, which is repugnant to a free and democratic society.
Such therefore is the rule that we must lay down, if we wish to conduct the Revolution intelligently.
Every industry, operation or enterprise, which by its nature requires the employment of a large number of workmen of different specialties, is destined to become a society or a company of workers.
That is why I said one day, in February or March, 1849, at a meeting of patriots, that I rejected equally the construction and management of railroads by companies of capitalists and by the State. In my opinion, railroads are in the field of workmen’s companies, which are different from the present commercial companies, as they must be independent of the State. A railroad, a mine, a factory, a ship, are to the workers who use them what a hive is to the bees, at once their tool and their home, their country, their territory, their property. It is surprising that they who so zealously maintain the principle of association should have failed to see that such was its normal application.
But where the product can be obtained by the action of an individual or a family, without the co-operation of special abilities, there is no opportunity for association. Association not being called for by the nature of the work, cannot be profitable nor of long continuance: I have given the reasons elsewhere.
When I speak of either collective force or of an extreme division of labor, as a necessary condition for association, it must be understood from a practical point of view, rather than in a rigorous logical or mathematical sense. Liberty of association being unrestricted, it is evident that if the peasants think well to associate, they will associate, independently of the considerations against it; on the other hand, it is not less clear that if one must live up to the rigorous definitions of science, the conclusion would be that all workers must associate, inasmuch as collective force and division of labor exist everywhere, to however slight a degree.
We must supplement the deficiencies of language, and do for political economy what naturalists do in their classifications, that is to select always not doubtful but marked characteristics, upon which to base our definitions.
I mean to say, therefore, that the degree of associative tendency among workers must be in proportion to the economic relations which unite them, so that where these relations are inappreciable or insignificant, no account need be taken of them; where they predominate and control, they must be regarded.
Thus I do not consider as falling within the logical class of division of labor nor of collective force the innumerable small shops which are found in all trades, and which seem to me the effect of the preference of the individuals who conduct them, rather than the organic result of a combination of forces. Anybody who is capable of cutting out and sewing up a pair of shoes can get a license, open a shop, and hang out a sign,
So-and-So, Manufacturing Shoe Merchant, although there may be only himself behind his counter. If a companion, who prefers journeyman’s wages to running the risk of starting in business, joins with the first, one will call himself the employer, the other, the hired man; in fact, they are completely equal and completely free. If a youth of fourteen or fifteen wants to learn the trade, there may be a certain division of labor with him; but this division of labor is the condition of apprenticeship, there is nothing remarkable about it. If orders come in freely, there may be several journeymen and apprentices, besides helpers, perhaps a clerk: then it will be what is called a shop, that is, six, ten, fifteen persons, all doing about the same thing, and working together merely to increase the product, not at all to contribute to its perfection by their different abilities. If suddenly the employer’s affairs fall into confusion, and he goes into bankruptcy, they whom he employed will have only the trouble of finding another shop; as for his customers, they run no risk, each of the journeymen, or all of them together, may resume the business.
In such a case, I see no reason for association, unless for individual preference. What collective force there is counts for too little; it does not counterbalance the risks of the venture. Journeymen may wish to be admitted to the advantages of a prosperous establishment: I see no difficulty, if the employer consents, and the law does not forbid it. It may be that all, both employer and journeymen, find it to their advantage; that brings it among special cases, which cannot enter into consideration here. But according to the economic law which guides us, such participation cannot be demanded: it is entirely outside of the provision of the new rule of right. To order or prescribe association under such conditions, would be to reerect, through a mean and jealous spirit, the unfortunate feudal corporations which the Revolution abolished: it would be unfaithful to progress, and a backward step, which is impossible. That is not the future of association, considered as an economic and revolutionary institution. I cannot but repeat what I have already said elsewhere, that the workingmen’s associations which have formed at Paris for industries of this nature, as well as the heads of concerns who have given their employes a share in their dividends, ought to consider themselves as serving the Revolution from an entirely different point of view, and for a different object. I shall speak of this again shortly.
But when the enterprise requires the combined aid of several industries, professions, special trades; when from this combination springs a new product, that could not be made by any individual, a combination in which man fits in with man as wheel with wheel; the whole group of workers forms a machine, like the fitting of the parts of a clock or a locomotive; then, indeed, the conditions are no longer the same. Who could arrogate the right to exploit such a body of slaves? Who would be daring enough to take one man for a hammer, another for a spade, this one for a hook, that one for a lever?
The capitalist, you will cry, alone runs the risk of the enterprise, like the employing shoemaker of whom we spoke just now. No doubt that is true, but the comparison holds no further. Could the capitalists alone work a mine or run a railroad? Could one man alone carry on a factory, sail a ship, play a tragedy, build the Pantheon or the Column of July? Can anybody do such things as these, even if he has all the capital necessary? And the one who is called the employer, is he anything more than a leader or captain?
It is in such a case that association seems to me absolutely necessary and right.
The industry to be carried on, the work to be accomplished, are the common and undivided property of all those who take part therein: the granting of franchises for mines and railroads to companies of stockholders, who plunder the bodies and souls of the wage-workers, is a betrayal of power, a violation of the rights of the public, an outrage upon human dignity and personality.
Certainly the Parisian workmen, who were the first to mark the course of the Revolution, and assert the principle of identity of interests, were unable at the outset to carry out such a method. It was not for them to organize themselves into manufacturing companies and railroads. Heaven forbid that I should reproach them for it! The position was captured (it will again be captured) and held by thousands of bayonets. The capital which it would be necessary to reimburse was enormous; institutions of credit, indispensable in such a case, did not exist. The workmen could do nothing in this direction: the force of circumstances threw them into industries in which association is least useful. Moreover their work was wholly one of devotion, and provisional in character, nor had it any other aim than to put down usurious commerce, to drive out parasitical speculation, and to form a chosen body of artisans, who would be able to renew the tactics of industrialism, and organize victory for the lower classes, like the young generals of the old revolution.
Thus the outline of the Revolution begins to display itself: already its aspect is grandiose.
On the one hand, the peasants, at last masters of the soil which they cultivate, and in which they desire to take root. Their enormous, unconquerable mass, aroused by a common guaranty, united by the same interests, assures forever the triumph of the democracy, and the permanence of Contract.
On the other hand there are myriads of small manufacturers, dealers, artisans, the volunteers of commerce and industry, working in isolation or in small groups, the most migratory of beings; who prefer their complete independence to the sovereignty of the soil; sure of having a country wherever they can find work.
Finally appear the workingmen’s associations, regular armies of the revolution, in which the worker, like the soldier in the battalion, maneuvers with the precision of his machines; in which thousands of wills, intelligent and proud, submit themselves to a superior will, as the hands controlled by them engender, by their concerted action, a collective force greater than even their number.
The cultivator had been bent under feudal servitude through rent and mortgages. He is freed by the land bank, and, above all, by the right of the user to the property. The land, vast in extent and in depth, becomes the basis of equality.
In the same way the wage-worker of the great industries, had been crushed into a condition worse than that of the slave, by the loss of the advantage of collective force. But by the recognition of his right to the profit from this force, of which he is the producer, he resumes his dignity, he regains comfort; the great industries, terrible engines of aristocracy and pauperism, become, in their turn, one of the principal organs of liberty and public prosperity.
Our readers must understand by this time that the laws of social economy are independent of the will of any man or any legislator: it is our privilege to recognize them, our honor to obey them.
This recognition and this submission, in the present state of our prejudices, and under the rule of the traditions which beset us, can be brought about only by the mutual consent of the citizens, in a word, by contract. what we have done for credit, housing, agriculture, we must do for the great industries: in this case, as in the others, legislative authority will intervene, only to write its last will and testament.
Let us then lay down the principles of the agreement which must constitute this new revolutionary power.
Large-scale industry may be likened to a new land, discovered, or suddenly created out of the air, by the social genius; to which society sends a colony to take possession of it and to work it, for the advantage of all.
This colony will be ruled by a double contract, that which gives it title, establishes its property, and fixes its rights and obligations toward the mother-country; and the contract which unites the different members among themselves, and determines their rights and duties.
Toward Society, of which it is a creation and a dependence, this working company promises to furnish always the products and services which are asked of it, at a price nearly as possible that of cost, and to give the public the advantage of all desirable betterments and improvements.
To this end, the working company abjures all combinations, submits itself to the law of competition, and holds its books and records at the disposition of Society, which, upon its part, reserves the power of dissolving the working company, as the sanction of its right of control.
Toward the individuals and families whose labor is the subject of the association, the company makes the following rules:
That every individual employed in the association, whether man, woman, child, old man, head of department, assistant head, workman or apprentice, has an undivided share in the property of the company;
That he has the right to fill any position, of any grade, in the company, according to the suitability of sex, age, skill, and length of employment;
That his education, instruction, and apprenticeship should therefore be so directed that, while permitting him to do his share of unpleasant and disagreeable tasks, they may also give variety of work and knowledge, and may assure him, from the period of maturity, an encyclopedic aptitude and a sufficient income;
That all positions are elective, and the by-laws subject to the approval of the members;
That pay is to be proportional to the nature of the position, the importance of the talents, and the extent of responsibility;
That each member shall participate in the gains and in the losses of the company, in proportion to his services;
That each member is free to leave the company, upon settling his account, and paying what he may owe; and reciprocally, the company may take in new members at any time.
These general principles are enough to explain the spirit and scope of this institution, that has no precedent and no model. They furnish the solution of two important problems of social economy, that of collective force, and that of the division of labor.
By participation in losses and gains, by the graded scale of pay, and the successive promotion to all grades and positions, the collective force, which is a product of the community, ceases to be a source of profit to a small number of managers and speculators: it becomes the property of all the workers. At the same time, by a broad education, by the obligation of apprenticeship, and by the co-operation of all who take part in the collective work, the division of labor can no longer be a cause of degradation for the workman: it is, on the contrary, the means of his education and the pledge of his security.
We may add that the application of these principles at an epoch of transition would entail that at which every man of heart, every true revolutionary, should rejoice, the privilege of beginning the reform for the middle class, and its fusion with the lower class.
It must be admitted that, although the laboring class, by its numerical preponderance, and by the irresistible pressure which it is able to exercise upon the decisions of an assembly, is quite capable, with the aid of a few enlightened citizens, of bringing about the first part of the revolutionary program, social liquidation and the settlement of property in land; it is, nevertheless, by the narrowness of its view and its inexperience in business, incapable of carrying on such large interests as those of commerce and great industry; and in consequence cannot attain its true destiny.
Men are lacking in the lower class, as well as in the democracy: we have seen it too clearly for three years. They who have reached the greatest celebrity as officials are the last to merit the confidence of the people in matters relating to labor and social economy. Ask the Parisian associations, enlightened by their experience, what they think to-day of the crowd of little great men, who recently waved the banner of fraternity before them. It would be unavoidable then, in what relates to the carrying on of large industries, that some commercial and industrial experts should be associated with the liberated workers, to teach them the management of affairs. They can be found in abundance; there is not one of the mercantile class, acquainted with commerce and industry and their innumerable risks, who would not prefer a fixed salary and honorable position in a working association to all the worries of a private business; there is not an exact and capable clerk who would not leave a precarious position to accept an appointment in a great association. Let the workers consider it; let them get rid of a mean and jealous spirit; there is room for everybody in the sunlight of the Revolution. They have more to gain by such self-conquest than by the interminable and always destructive squabbles which are inflicted upon them by their leaders, who are sincere, no doubt, but incapable.
If commerce or exchange, carried on after a fashion, is already, by its inherit merit, a producer of wealth; if, for this reason, it has been practiced always and by all the nations of the globe; if, in consequence, we must consider it as an economic force; it is not the less true, and it springs from the very notion of exchange, that commerce ought to be so much the more profitable if sales and purchases are made at the lowest and most just price; that is to say, if the products that are exchanged can be furnished in greater abundance and in more exact proportion.
Scarcity of product, in other words, the high price of merchandise, is an evil in commerce: the imperfect relations, that is to say, the arbitrary prices, the anomalous values, are another evil.
To deliver commerce from these two diseases that eat into and devour it, would be to increase the productivity of commerce, and consequently the prosperity of society.
At all times speculation has taken advantage of these two scourges of commerce, scarcity of product and arbitrary value, in order to exaggerate them, and bring pressure upon the unhappy people. Always also the public conscience has rebelled against the exactions of mercantilism, and struggled to restore the equilibrium. We all know of the desperate war waged by Turgot against the monopolizers of grain, who were supported by the courts and by precedent; we can also remember the less fortunate efforts of the Convention, and its laws establishing maximum prices. In our own day, the tax on bread, the abolition of the slaughter house privilege, the railroad rate scale, and those of ministerial offices, &c., &c., are so many attempts in the same direction.
It must always be remembered with shame that certain economists have nevertheless aspired to erect into a law this mercantile disorder and commercial disturbance. They see in it a principle as sacred as that of the family or of labor. The school of Say, sold out to English and native capitalism, the chief focus of counter-revolution next to the Jesuits, has for ten years past seemed to exist only to protect and applaud the execrable work of the monopolists of money and necessaries, deepening more and more the obscurity of a science naturally difficult and full of complications. These apostles of materialism were made to work in with the eternal executioners of conscience: after the events of February, they signed an agreement with the Jesuits, a compact of hypocrisy and a bargain with starvation. Let the reaction which unites them hasten to cause them to retrace their steps, and let them get to cover quickly, for I warn them that if the Revolution spares men, it will not spare deeds.
No doubt Value, the expression of liberty, and growing out of the personality of the worker, is of all human things the most reluctant to submit to formulas. Therein lies the excuse of the misleading routine arguments of the economists. Thus the [disciples] of Malthus and Say, who oppose with all their might any intervention of the State in matters commercial or industrial, do not fail to avail themselves at times of this seemingly liberal attitude, and to show themselves more revolutionary than the Revolution. More than one honest searcher has been deceived thereby: they have not seen that this inaction of Power in economic matters was the foundation of government. What need should we have of a political organization, if Power once permitted us to enjoy economic order?
But precisely because Value is in the highest degree difficult to formulate, it is eminently transactional, seeing that it is always the result of a transaction between the seller and the buyer, or as the economists say, between supply and demand.
In fact, the price of things is the fundamental question in agreements; the one natural and constant element in all contracts between man and man. Whence it follows that the theory of Value is the basis of commutative justice: it should be found at the head of all legislation, as it were a decalogue, since without some preexisting Value there can be neither sale, nor exchange, nor hire, nor society, nor interest, nor bonds, nor mortgages, &c. Therefore it is not a mere theoretical determination of Value that is needed; it is a practical method of arranging an honest transaction in respect of value.
Who could believe, if the evidence were not before our eyes, that for the six thousand years since men began to govern by law, not one law has been made in the whole world having for its object, not to fix the value of things, which is impossible, but to teach traders how to approximate it? Rules for the form of contracts abound and vary infinitely; as to their matter, no question has been raised. Therefore we have laws by hundreds of thousands, and not one principle. It is a world upside down, a world at war, such a world as lawyers and judges have made it, and such as Jesuits and Malthusians want to keep it.
It must be understood that I cannot here undertake the full discussion of the theoretical and practical questions which value raises; a discussion without end; which, without exaggeration, might well include the whole of political economy, the whole of philosophy and the whole of history. I reserve this interesting study for some other occasion; for the present, I must be brief, categorical, positive. I should despair of my task if the People had not shortened it by nine-tenths, through its practical, and at the same time revolutionary instinct. I am about to try to formulate their most recent practice. The People is the god who inspires true philosophers. May they recognize their own ideas in my quick words!
Everybody knows that from the earliest period exchange has been separated into two elementary operations, Sale and Purchase. Money is the universal commodity, the tally, which serves to connect the two operations, and to complete the exchange.
In order therefore to regulate exchange and to systematize commerce, it would be enough to effect methodically one or the other of the two acts of which it is composed, Sale or Purchase.
Let us take Sale for example.
According to what we have just said, Sale will be genuine, normal, fair, from the point of view of economic justice and of value, if it is made at a just price, as far as human calculation permits this to be established.
What then is the just price for all kinds of service or merchandise?
It is that which represents with exactitude: 1st, the total cost of production, according to the average experience of free producers; 2nd, the wages of the merchant, or indemnity for the advantage of which the seller deprives himself in parting with the thing sold.
If everything which constitutes the material of contracts were sold, hired or exchanged according to this rule, the whole world would be in repose; peace on earth would be inviolable; there would have been neither soldiers nor slaves, neither conquerors nor nobles.
But, unfortunately for humanity, things are not done so in commerce. The price of things is not proportionate to their value: it is larger or smaller according to an influence which justice condemns, but the existing economic chaos excuses—Usury.
Usury is the arbitrary factor in commerce. Inasmuch as, under the present system, the producer has no guaranty that he can exchange his product, nor the merchant any certainty of reselling, each one endeavors to pass off his merchandise at the highest possible price, in order to obtain by the excess of profit the security of which labor and exchange fail sufficiently to assure him. The profit thus obtained in excess of the cost, including the wages of the seller, is called Increase. Increase—theft—is therefore compensation for insecurity.
Everybody being given to Increase, there is reciprocal falsehood in all relations, and universal deceit, by common consent, as to the value of things. Of course this is not written out in black and white in contracts, although the courts would be quite capable of accepting it! But in the spirit of justice, and in the opinions of the parties, it is a perfect understanding among them.
If increase were equal as well as reciprocal, the equity of agreements, the equilibrium of commerce, and therefore the prosperity of society would not suffer. Two equal quantities increased by an equal quantity are still equal: it is a mathematical axiom.
But Increase is without rule, it is chance; and it is against the nature of chance to produce equality or order. Hence it results that the reciprocity of rascality; and that this pretended law of the economists is the most active cause of spoliation and poverty.
This is what the Revolution proposes.
Since there is a universal tacit agreement among all producers and traders to take from each other increase for their products or services, to work in the dark in their dealings, to play a sharp game; in a word, to take each other by surprise by all the tricks of trade; why should there not as well be a universal and tacit agreement to renounce increase, that is to say, to sell and pay at the only just price, which is the average cost?
Such an agreement would not be illogical: such alone can secure the prosperity and security of mankind. Sooner or later it can, it must, come to pass; and for my part, I have no doubt that, with a little perseverance on the part of the people, it will come to pass.
But it is hard to stem the current of ages, and to make prejudice retrace its path: a long time, generations perhaps, will pass before the public conscience reaches such a height. While awaiting this marvelous change, there is but one way, that is, to obtain by special formal agreements what will hereafter result from tacit and universal consent, without other special agreement.
Selling at a just price! the old hands will exclaim; that has been known for a long time. What good has it done? Dealers who sell at a just price do not make their fortunes any more, or ruin themselves any less than the rest of us; and, as for the purchasers, they are not better served, nor do they pay less than before. All that talk, they will say, is but empiricism, the revival of worn-out ideas, illusion, despair.
That is precisely what I deny. Sale at a just price is unknown: it has never been put into practice, and for the good reason that it has not been understood.
What will surprise more than one reader, and what seems at first sight contradictory, is that a just price, like any sort of service or guaranty, must be paid for: the low price of merchandise, like the merchandise itself, must have its recompense: without this premium offered to the merchant, the just price becomes impossible, the low price a chimera.
Let us look into this truth, one of the most profound of political economy.
If the dealer usually refuses to sell his goods at cost, it is, on the one hand, because he has no certainty of selling enough to secure him an income; on the other, because he has no guaranty that he will obtain like treatment for his purchases.
Without this double guaranty, sale at a just price, the same as sale below the market price, is impossible: the only cases in which it occurs arise from failures and liquidations.
Do you wish then to obtain goods at a just price, to gain the advantage of a low price, to practice a truth-telling commerce, to assure equality in exchange?
You must offer the merchant a sufficient guaranty.
This guaranty may take various forms: perhaps the consumers, who wish to have the benefit of a just price, are producers themselves, and will obligate themselves in turn to sell their products to the dealer on like terms, as is done among the different Parisian associations; perhaps the consumers will content themselves, without any reciprocal arrangements, with assuring the retailer of a premium, the interest, for example, of his capital, or a fixed bonus, or a sale large enough to assure him of a revenue. This is what is generally done by the butchers’ associations, and by the Housekeeper society, of which we have already spoken.
These different kinds of guaranties, with the aid of the action of representatives in the Assembly and of an allowance in the budget, might quickly become general, and produce extraordinary effects immediately.
Suppose that the Government, or the Constituent Assembly, to which the proposition was made, had really wanted to revive business, to relieve commerce, industry and agriculture, to stop the depreciation of property, to assure work to laborers.
It might be done by guaranteeing to, say, the first ten thousand employers, manufacturers, dealers, &c., in the whole Republic, the interest at 5 per cent. of the capital which each of them might put into business, up to an average amount to each of $20,000.
I say by guaranteeing, not by paying interest: it would have been agreed that if the net profit of the business amounted to 5 per cent. or more, the State should make no payment for interest.
The capital thus guaranteed for ten thousand establishments would amount to $200,000,000. The interest to be paid, if paid on the whole of this sum, would be $10,000,000. But it is evident that the State would never have to part with any such sum: ten thousand commercial establishments cannot operate simultaneously without serving as a support to one another: what one produces another consumes; labor is the outlet. The State would not have to pay over $2,000,000 interest of the $10,000,000 which it guaranteed.
Can it be thought that such a sum can be compared with the deficit in production caused by the withdrawal of capital and the insecurity of employers, with the enormous depreciation of property, with the [poverty] and struggle which have decimated the lower classes?
In a published memorial, speaking in the name of a mercantile house of Lyons, I made a proposition of a different nature to the Government,—that we would guarantee transportation of all merchandise and passengers from Avignon to Chalons-sur-Marne, for from 60 to 80 per cent. less than the railroad charges, stipulating that the State should guarantee to the constructors interest at 5 per cent. on their investment.
That would be to obtain, for $60,000, a saving of several millions.
Do you know what the answer was?
The Government directorate of the Paris to Lyons railroad, under the pretext that it did not want to cut into prices by favoring a monopoly, preferred to treat with some friendly speculators for its connection, at a higher price than that of the railway could be. So that if in two or three years this railway is built, the company or the State will still seem to be benefitting the Country. It is thus that a Government acts that knows its business. Louis V was the heaviest stockholder in the starvation pact: the historians, friends of authority, have condemned his memory to infamy. He speculated in food. The ministers of the Republic and their assistants will retain their reputation for integrity. They speculate only in transportation.
I say plainly that the associations of workmen of Paris and of the provinces hold in their hands the salvation of the people and the future of the Revolution. They are able to accomplish everything if they use skill. It must be that a renewal of activity on their part will bring light to the darkest minds, and will compel the placing of the Constitution of Value at the head of the list in the platform for the elections of 1852.
This constitution can result, as I have said, only from universal consent freely obtained and freely expressed. To prepare for it, and to bring it about with the least delay possible, it will suffice if instructions are given through the new organization of representatives to the State and to the towns, each to the extent of its authority and to the limit of its resources, to advise with a certain number of employers, machinists, manufacturers, farmers, cattle raisers, coachmen, messengers, &c., &c., about the submission of bids upon the following basis:
The State, in the name of the interests which it provisionally represents, and the Provinces and Towns, in the name of their respective inhabitants, desiring to assure to all fair prices and good quality of products and services, and to prevent fraud, monopoly and increase, offer to guarantee to the bidders who shall submit the most advantageous conditions, either interest upon the capital and plant used in their business, or a fixed bonus, or, if practicable, a sufficient volume of orders.
Bidders will undertake to return to furnish their products and services, as described in their bids, to satisfy the needs of consumers—full latitude however to be allowed for competition.
They must state the basis of their prices, the mode of delivery, the period of their engagement, and their means of execution.
Sealed bids having been deposited within the prescribed period, will be forthwith opened and published for a week, a fortnight, a month, three months, according to the importance of their subject, before an award is made.
At the termination of each contract, new bids will be received.
The constitution of Value is the contract of contracts. It includes all others, realizing the idea which we have explained in another essay, that the social contract should include all persons, all interests.
When, by the liquidation of debts, the organization of credit, the deprivation of the power of increase of money, the limitation of property, the establishment of workingmen’s associations and the use of a just price, the tendency to raising of prices shall have been definitely replaced by a tendency to lower them, and the fluctuations of the market by a normal commercial rate; when general consent shall have brought this great about-face of the sphere of trade, then Value, at once the most ideal and most real of things, may be said to have been constituted, and will express at any moment, for every kind of product, the true relation of Labor and Wealth, while preserving its mobility through the eternal progress of industry.
The constitution of Value solves the problem of competition and that of the rights of Invention; as the organization of workmen’s associations solves that of collective force and of the division of labor. I can merely indicate at this moment these consequences of the main theorem; their development would take too much space in a philosophical review of the Revolution.
By the suppression of custom houses, the Revolution, according to theory, and regardless of all military and diplomatic influences, will spread from France abroad, extend over Europe, and afterwards over the world.
To suppress our custom houses is in truth to organize foreign trade as we have organized domestic trade; it is to place the countries with which we trade on even terms with ourselves in our trade legislation; it is to introduce among them the constitution of Value and of Property; it is, in a word, to establish the solidarity of the Revolution between the French People and the rest of the human race, by making the new social compact common to all nations through the power of Exchange.
I am about to give a glimpse of this movement in few words.
For what end have custom houses been established?
For the protection of the labor of the nation.
In what does this protection consist?
The State, which is the guardian of the portals of the country, requires foreign merchandise, at its entrance into France, to pay a greater or less tax, which raises the price and favors the sale of home products.
Why not prefer foreign products, you will ask, if it is true that they are cheaper than our own?
Because products can be bought only with products; and if foreign competition should crush our industry in all or in the greater number of directions, it would come to pass that we would be unable to balance our imports by our exports, and would have to pay for them with money, and, when our money was gone, to borrow money abroad, and, what is worse, paying them interest, profit and rent.
Such is the wise and good reason for the establishment of custom houses. All nations understand it, and all nations protect themselves. Let us not dispute as to the efficacy of the means; let us take it for what it is meant to be, with its official significance.
From this definition of the tariff it follows that if it protects the producer, it is not to be understood as making him an exploiter and idler among his fellow citizens; but simply as assuring him of employment, and safeguarding the independence of the country from foreign control. It is with this intention that the tariff, as it perceives that an industry is developing and making profits, reduces its rates and calls in foreign competition, in order to protect the interests of the consumer as much as those of the producer.
Once more, let us not ask whether all these measures which good sense suggests perform the service that is expected of them; whether they are carried out with justice, or whether any irregularity slips in. The question now is not one of morality, nor of the capacity of the State to act as a protector; but solely of the aim of the institution, and of the necessity which requires it.
Then, as there is progress in every industry, a tendency to reduce the cost of production, and thus to increase the profits, there should also be a tendency to diminish the customs tariff.
The ideal of the system would be that labor should be everywhere guaranteed, competition everywhere established, sales everywhere assured, and prices maintained at their lowest. Such is the true meaning and intention of the tariff.
From what we have said in connection with social liquidation, as well as in connection with the constitution of property, the organization of workingmen’s societies and the guaranty of low prices, it follows that if the charge for loans at the Bank should diminish, if the interest on the public debt and upon private obligations were proportionally reduced, if thereupon house rent and ground rent were lowered in like proportion, if a tabulation were made of values and properties, &c., &c., the cost price of all sorts of products would decrease notably, and in consequence the tariff might be lowered to the advantage of all.
That would be a step in general progress such as has never yet been seen, because a government is incapable of bringing it about.
If this general movement, as I have more than once observed, should only make a beginning, if the tariff, driven by credit, should move on this line however little, the ancient order of things in all that concerns our foreign relations would be suddenly changed, and international economics would enter upon the road to revolution.
In the matter of the tariff, as in everything else, the statu quo, indicated by rising prices, is reaction; progress, indicated by falling prices, is the Revolution. A famous aristocrat, Robert Peel, understood it thus, and put it thus in practice; showing himself as far from the theories of Cobden, as from the selfishness of the property holders. The tariff reforms of Robert Peel had for their basis and preliminary condition the superabundance and low price of capital in England; while with us the free traders, aided by the Mountainists, are asking for the abolition of the tariff, as compensation of the national capital, which amounts to foreign invasion, to repair our deficiencies; exploitation by English, Swiss, Dutch, American, Russian capitalists, to help the emancipation of our proletarians! We did not need this example to discover that if the French nation is sold out to the foreigner, if the Revolution is betrayed, if a conspiracy is organized against Socialism, it has been done chiefly by the organs and representatives of the Republican party. But we must pardon them: they do not know any more what they are doing, than what they want.
As for me, I, who oppose the free traders because they favor interest, while they demand the abolition of tariffs,—I should favor lowering the tariff from the moment that interest fell; and if interest were done away with, or even lowered to ¼ or ½ per cent., I should be in favor of free trade.
I believe in free trade, even without reciprocity, as a consequence of the abolition of interest, not otherwise; and here is what I base my opinion upon.
If to-morrow the Bank of France should reduce the rate of discount to ½ per cent., both interest and comission included, the manufacturers and dealers of Paris and of the provinces who had no account with the Bank of Paris would immediately be compelled to obtain notes of the Bank for their transactions, since the notes would cost only ½ per cent., instead of 6, 7, 8 or 9 per cent., which money would cost at private bankers.
But it would not be French dealers only who would enter into this arrangement: foreign dealers would join in also. As the notes of the Bank of France would cost only ½ per cent., while those of other countries cost ten and twelve times as much, the former would be preferred; all the world would take advantage of the use of this money in payments.
In order to obtain a greater quantity of these notes, foreign producers would lower the prices of their goods, which would increase the quantity of our imports. But as these notes could no longer be used to buy bonds, since we have liquidated the national debt, nor invested in mortages on the land, since we have liquidated all mortgages and changed the form of property; as products, it is clear that we should no longer have to protect ourselves against imports; on the contrary, we should welcome them. The relation would be reversed: we should no longer need to reduce our purchases, but foreigners would have to be careful not to buy too much.
How can a nation refuse to sell? Such an idea is repugnant: with the universal development of industry, and the division of labor among nations, it implies a contradiction.
To reestablish the balance and to protect themselves against these tactics, foreigners would be obliged to abolish their own custom houses and to reform their banking systems, to constitute value, to emancipate their lower classes; in a word, to bring about revolution. Free trade would then become equal exchange, the diversity of interests among nations would gradually result in unity of interest, and the day would dawn when war would cease among nations, as would lawsuits among individuals, from lack of litigable matter and absence of cause for conflict.
Without exceeding the limits which I have been obliged to lay down for myself, I cannot extend this exposition of the industrial organism, especially of that which relates to the new principle of order, the free contract. Those of my readers who have followed for ten years past the course of my revolutionary argument, will easily fill out what is missing. In resuming the series of economic negations, they will have no difficulty in separating the affirmations and deducing the synthesis.
It is for republican jurisconsults, such men as Crémieux, Michel (of Bourges), Martin (of Strasbourg), Jules Favre, Marie, Bethmont, Grévy, Dupont (of Bussac), Madier de Monjau, Desmarest, Marc-Dufraisse, Ledru-Rollin, to open up this new path to the spirit of the century, by developing the revolutionary formula resulting from the opposition of the Social Contract to Government. Long enough politics has been a stumbling block for legal luminaries; and it is not without good reason that the peasant and the soldier, seeing the politicians at work, deride their eloquence and their patriotism. What can there be in common between the man of Law and the man of Force? The revival of despotism fifty-two years ago was marked by the expulsion of the barristers; and with propriety. The Constitution of the year V was a bad case for lawyers. As soon as they admitted the principle of government, they had to give way to the representatives of mere force; legal reasoning has nothing to do with the exercise of authority.
In concluding this study, may I be permitted a word in answer to the reproach of pride which has so often and so mistakenly been made on account of the motto I put at the head of my book on
Contradictions—Destruam et aedificabo—I destroy and I will rebuild.
This antithesis, taken from Deuteronomy, is nothing but the formula of the revolutionary law which serves as the basis of the present essay, to wit, that every negation implies an affirmation, and that he only is the real rebuilder who is first a real destroyer.
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