II. 2000 c + 500 v + 500 s — 3000 means of consumption.

Total value — 9000, from which the fixed capital which con- tinues to exist in its natural form is excluded.
Let us now see what turnovers are necessary in this case, on the basis of simple reproduction in which the entire sur- plus-value is consumed. If we at first make abstraction of the money circulation which serves as medium for them, we at once get three important clues:
1. The 500 v, labour-wages, and 500 s, surplus-value of the capitalists in division II, must be spent on me. But their .value in me amounts' to 1000, which, in the hands of the capitalists of division II, replace the 500 v advanced and represent the 500 s. The labour-wages and surplus-value of division II are thus, within that division, exchanged for the product of II. Thus (500 v + 500 s) II — 1000 me disappear from the total product.
CRISES. 269
2. The 1000 v + 1000 s of division I must likewise be spent on me, consequently on the product of division II. They must therefore be exchanged for that part of the con- stant capital 2000 c still remaining over from this product. In return, division II receives a similar amount of mp, which incorporate the labour wages and the surplus-value of division I. Hence 2000 II c and (101)0 v + 1000s) I dis- appear from our calculation.
3. There still remain 4000 I c. These consist of mp, which can only be utilised in division I, which serve to replace its consumed constant capital, and which thus accomplish their destiny by being exchanged between the individual capita- lists of division I.
(The above is for the meantime, to enable the reader to understand better what follows).
Let us now come to the great exchange which takes place between the two divisions.
(1000 v + 1000 s) I — mp in the hands of the produ- cers in division I — are exchanged for 2000 c II, /. e. for values in the natural form of me. The capitalists of divi- sion II thus convert again their constant capital from out of the form me into the form mp; and the latter are pre- cisely such mp as are able to produce new me. On fhe other hand, the labourers and capitalists of division I receive in this way, in exchange for their wages and surplus-value, the me needed by them.
For this mutual turnover, however, a process of money circulation serves as medium; the process in question renders more difficult the comprehension of the former; but it has decisive importance, for the reason that labour-wages (the variable part of capital) must perpetually reappear in money form. In all branches of business, whether in division I or division II, wages are paid in that form. In order to ob- tain the money, the capitalist must sell commodities.
In division I the total capital has paid 1000 (which we may designate as £ 1000, in order to underline the fact that it is a money value) — 1000 v to the labourers for that part of the product already existing as v part. The la- bourers buy for the £ 1000 me from the capitalists of divi- sion II, and thus transform half the constant capital of the latter into money; the capitalists of division II, in their
270 CHAPTIiR XXIV.
turn, buy with the £ 1000 mp from those of division I; the latter's variable capital is herewith once more converted into money, for which they can buy new labour power. The capitalists of division I have, therefore, originally advanced this money themselves.
More money is necessary, in order to exchange those nip which represent the surplus-value of the capitalists of division I, for the second half of the constant capital of di- vision II. These sums can be advanced in different ways, but must under all circumstances be derived from the capi- talists; for we have already settled our account in respect of the money thrown into the process of circulation by the labourers. A capitalist in division II can buy mp with the money capital he possesses in addition to his productive capi- tal; or, vice-versa, a capitalist in division I can buy me out of money reserves destined to meet his personal expenses (and not for investment as capital). Certain money reserves
- whether for investment as capital or for personal expen- diture — must under all circumstances be presumed available, alongside of productive capital, in the hands of the capi- talists. Let us assume (for our purpose the proportion is quite indifferent) that one half of the money is advanced by the capitalists of division II for the purchase of nip, where- as the other half is spent by the capitalists of division I on me. In this case, division II has replaced three-quarters of its constant capital in naiura with £ ">()() (including the .Ji 1000 derived from the labourers of division I). Divi however, gives the £ f>00 thus obtained back to division II in exchange for me; and division II gets back in this way the £ ;"(»() as money capital, which it owns alongside of its productive capital. In addition to this, division I gives also
i' r.OO for the purchase of me. With these last £ r.OO divi- sion II buys mp, and has thus replaced its entire constant capital (1000 + 500 + 500 i>000» /// naiura; whereas divi- sion I has spent its whole surplus- value on me. All in all, a turnover of commodities to the extent of £ 4000 with a money circulation of L L'OOO would have taken place. We only obtain this amount of money because we assumed that the entire annual product was, all at a time, turned over in a few large lots. The only thing of importance, here, is that division II exchanges its constant capital me for mp, and also gets back tin- i' flui) advanced for the purchase of
CRISES. 271
mp; and that division I regains possession in money form of its variable capital, which had the form of mp, and is thus enabled to buy new labour power, and that it likewise receives back the £ 500 which it had expended on the pur- chase of me before having sold the surplus-value of its capi- tal. These £ oOO, however, flowed back, not by reason of Ihe expenditure, but through the subsequent sale of a part of the commodity-product surplus-value.
The general consequence is: so much of the money I thrown by the producing capitalists into the process of cir- culation returns into the hands of each individual capitalist,! as he has advanced for the money circulation.
There now remains only the variable capital (labour- wages) of division I. At the end of the process of produc- tion it first exists in that commodity form in which the la- bourers have supplied it, /. c. in mp. The labourers have received their wages from the capitalists of division I. But the labourers do not buy mp, this money does not return direct to the capitalists of I, but first goes to the capitalists of II, from whom the labourers buy their me. And, only because the capitalists of II spend the money on the pur- chase of mp, does it return by this circuitous route into the possession of the capitalists of I.
In the case of simple reproduction, therefore, that part of the annual product of division I which represents the sum v + s of division I must be equal to the constant capital of division II, or to that part of the total product of division II which represents the latter's constant capital. I (v + s) = II c.
It still remains for us to study the components parts v +s of the value of the product of division II. With the labour-wages received from the capitalists of division II, the labourers of this division evidently buy back a part of their own produce. Hereby the capitalists of division II re-trans- form the money capital advanced by them for wages, into money form. It is just the same as if they had merely paid their labourers in stamps.
Division II of production consists of the most heteroge- neous branches of industry, which can, however, be grouped in two main subdivisions-
272 CHAPTER XXIV
A) Means of consumption, which are needed by the la- bourers,' and which, in so far as they are necessary means of subsistence, also constitute a part of the consumption of the capitalists. For our purpose we may conveniently re- sume this whole subdivision as the subdivision of net means of consumption. It is indifferent whether any given product, such as c. g. tobacco, be physiologically necessary or not; it suffices, that it is habitually consumed by the la- bourers.
B) Luxuries for consumption, /'. c. those means of con- sumption which are consumed exclusively by the capitalists, and which, therefore, can only be exchanged for surplus- value.
In the case of the necessary me, it is clear, that the wages advanced in money form in the course of their pro- duction must return direct to those capitalists of division II who produce such necessary means of subsistence (/. /'. to the capitalists of II A). The means of circulation are here directly furnished by the money which the labourers spend. It is different with subdivision II B. It is here a question of articles of luxury, which are not bought by the labourers. If the wages advanced for the production of those articles are to return again in money form to the capitalists, this cannot be effected directly; an intermediary is required. On calculating more closely we obtain a formula very simi- lar to that obtained when the surplus-value of division I (mp) is exchanged for me; and which shows that a similar proportion between the production of necessary means of subsistence and that of luxuries is required.
Assuming simple reproduction, we come necessarily to the following result:
1. That part of the yearly product, which, in the form of mp, represents newly created value (v 1 s), must b'r equal to the constant capital of the other parl existing in the form of me. If the former were smaller than lie, II could not entirely reconvert its constant capital into mp, and could not, therefore, continue producing on the old scale. If, on the other hand, it were larger, a surplus would remain un- utilised.
SUPPLEMENT. 273
•J. The wages of the labourers engaged in producing luxuries must be smaller than the surplus-value of those capitalists who produce necessary means of subsistence.1
SUPPLEMENT.
The Essence of Marx's Theory of Crises.2
By Julian Borchardt.
In view of the fundamental divergency between the bourgeois and the socialist economic systems, opinions re- garding the phenomena of crises differ widely on almost all points. But it is a matter of general agreement that the crisis rnnsfifufeg a grave. Disturbance of the equilibrium be- tween production and consumption. As Paul Mombert writes": «A state of things whereby supply and demand ba- lance each other on the commodities market, in which con- sequently a complete equilibrium between production and consumption exists, in which the commodities produced find buyers with just as little difficulty as the demand for commo- dities can be satisfied — this appears as the economic ideal». As a matter of fact the connection between producer and consumer is to-day established by means of so numerous and often complicated intermediaries, that the fundamental truth, that production exists in view of consumption, and that com- modities are produced to satisfy the need for them, is easily overlooked. The natural consequence of this fundamental truth is that an equilibrium must he-sou prhfT i. e.
i We break off here — conformably with what we said in the introductory note to this chapter — Marx's exposition of the subject, and we would refer the reader to the essay entitled The Essence of Marx's Theory of Crises, published as a supplement to the present volume. EDITOR'S
- An explanation of chapter XXIV.
:1 Wirtschaftskrisen (Economic Crises), Karlsruhe, 19H p. 1,
274 supr/.i:Mi-'\r.
possible so much of each commodity must be produced as is needed by the consumers neither more nor less. If this is not the case, either two many or two few commodities will be produced, or else commodities other than those re- quired; and the result will be a disturbance of the market, which will make itself felt in proportion to its extent. We do not require a special training in political economy in order to perceive that, in times of crisis, on the one hand an immense amount of unsaleable commodities is lying piled up; whereas on the other hand, among the mass of consu- mers, a dearth of commodities prevails at the same time. True, it cannot without further ado be maintained that the discrepancy between production and consumption is the fault of either the producers or. the consumers. It may be that the commodities produced correspond, both quantitati- vely and qualitatively, lo the needs of consumption. But the very complicated apparatus which to-day conveys the com- modities from the producers to the consumers, can be out of order; with the consequence that, on the one hand, commo- dities remain unsaleable, which, on the other hand, are ur- gently needed. At any rate, it is certain that, whatever be its reasons, the crisis consists in a disturbance of the equi- librium between production and consumption.
The question rises: was this always the case? Or was there a time in which no such disturbance occurred - nay, may even have been impossible. A precise answer to this question is not possible, for our knowledge of the economic life of primitive peoples is much smaller than might be sup- posed after reading certain graphic descriptions. But it is reasonable to assume that among small hords of savages, who only seek to satisfy immediate wants, it is difficult to produce more or less than is necessary for such a purpose. If we come to the ancient Germanic tribes in the Hi Augustus and Hermann, we find that Steinhausen (Ger- manische Kultur in der Urzeit, pp. 144, sqq.) writes con- cerning them: «As is the case with all peoples living in a state of nature, labour knows but one motive imperative need due to scarcity. Regular labour does not exi- The activity resulting from the search for food, or from the necessities of habitation and the satisfying of other ele- mentary wants, is at first regarded only in a limited measure as labour . . . hach household procures and prodiu
THE ESSENCE OF MARX'S THEORY OF CRISES. 275
self everything necessary.» Let us imagine such a primitive Germanic tribe, perhaps consisting of only a few dozen mem- bers, which roams about in the forest, hunts, searches for roots and fruit, and robs other tribes; and we see at once that ihe idea of these people «producing» more or less than they immediately want, is untenable.
But this idea is difficult to conceive of in much higher phases of civilisation as long as «self-prodution», /. e. pro- dution in view of one's own needs, is the .predominant form. This form of production does not always retain the primitive characteristics of which we have just spoken. Economic activity became regulated. But let us take a tribe of a few hundred or even a few thousand members, which carries-on regularly cattle-breeding and agriculture as well as hunting and warfare; as long as «every household procures and pro- duces itself everything necessary» the needs of each indivi- dual are well known. And it is evident that the entire pro- ductive activity will be solely directed to satisfying these known needs. The same applies to the communal production of such small tribes. Of course excessive production (or «overproduction») can lake place in consequence of an unu- sually good harvest or of unusually large booty being cap- tured in a raid. But in these cases the difficulty of dispos- ing of the surplus products should not be noticeable. And thus we may, as a matter of fact, assume that during all the centuries in which «self-production» was predominant, /. c. production in view of one's own needs, the equilibrium between production and consumption.. .existed,- seeing that production had to be based exclusively on the needs of the consumers.
But, however long it may have lasted, the period of self- production none the less passed away. The constant growth of population, and the accompanying increase of the latter's requirements, led to the division of . labour- and to the pro- duction of commodities. Let us take the case of the earlier or later Middle Ages, when the town dwellers lived, if not exclusively, at all events mainly, by their handicraft. These inhabitants of the towns in the Middle Ages were all of them peasants. Either within or without the city walls, they owned their meadows on which they let iheir cattle graze. But, in addition, they had their respective handicrafts, and these provided them with an ever increasing share of their
276 SUPPLEMENT.
food. If, now, a shoemaker continually made shoes, a tailor clothes, a weaver cloth, etc. it was perfectly clear that he did not aim at satisfying his own requirements, but those of others. The finished products had to be sold, and were from the very beginning destined for sale. Commodities were produced.
Herewith arises the possibility of a rupture of the equi- librium between production and consumption. The direct connection between them is suppressed. For it must be noted that the sale of one's own products, at least in the case of the Germans, did not originate directly in the needs of the consumers, but in the increase in the volume of production. (As for the products of foreign countries, these were since the earliest iimes imported and sold by foreign tradespeople). The large landed estates, which arose under the Prankish dynasty (between about 500 and QOO) brought together, on one vast property and under 1he command of a single master, considerable numbers of people; and they called into existence a labour organisation for .their own systematic cultivation — a widely differentiated organisation of officials, warriors, administrators, peasants and handicraftsmen. Here, then, is the origin of handicraft to be found, and only here could it originate. On a small peasant holding, where per- haps less than a dozen persons lived together, it could occur to nobody to busy himself exclusively, for instance, with making clothes for so few people; he would not have had enough work to fill-up his iime. But on the large estates, where it was necessary to provide hundreds of persons with food, clothing, etc. labour was at first split-up in such a way that one man made only clothes, another only utensils, etc. To this division of labour must be attributed precisely the ever growing increase of productiveness. Production increased constantly, until it finally exceeded the needs of masters and dependents alike. The sale of such excess pro- duce began; and it is interesting to see how, in (ienuan history, the development of trade gradually separated the handicraftsman from the estate, caused him lo settle down in the market centres, and thus led to the foundation and extension of urban communities.
Nevertheless, we know nothing of any commercial crises during the Middle Ages, that is to say of serious ruptures of the equilibrium between consumption and production. Or,
THE ESSENCE OF MARX'S THEORY OF CRISES. 277
at any rate, we know only of such as had their origin in external causes, and especially in war; and which were due to the fact that production was insufficient to meet the de- mands of the consumers. But we do not read of any which, as is the case to-day, had their origin in internal causes, and derived from «overproduction».t And this is perfectly explicable. The primitive handicraftsman, in the Middle Ages, worked in reality only for his own immediate neigh- bourhood. But he knew beforehand exactly his neighbours' wants, and was able to regulate his production accordingly. For instance, the shoemaker at first only made boots to order; or such boots as he was quiie sure of selling immedi- ately. Then ca.me the trading and handicraft guilds, which exactly portioned out the market between their members. True, such primitive conditions did not last. Trajfrc^jmd^tnide were developed, not only between communities, but also between different countries. Of course, with every such extension, the possibility of a rupture of equilibrium in- creased. It was not possible to f of egee- -the- extent wf the requirements in a distant town, and especially in foreign countries, with the same accuracy as those in one's own neighbourhood; and hence it was not possible to adjust pro- duction to them with the same exactitude. But none the less did the connections between production and consumption still remain clear, uncomplicated, and visible at a glance. As we have said, we know nothing of any serious disturbances.
We may, therefore, take it to be proved that during the period of self-production the equilibrium between production and consumption was, so to speak, self-evident; production was determined by the needs_ of the consumers. These needs then caused the division of labour, "~aTnt~thus created the possibility of a rupture of the equilibrium. That disturbing factor was however, necessary, in order to engender the forces which were alone in a position to satisfy the in- creased requirements.
From the simple production of commodities, the process of evolution leads up to the dawn of the capitalistic era. What does the difference between capitalism and the simple pro- duction of commodities consist of? From an external point of view, in the lack of independence of the producer. The handicraftsman is his own master, who works for his own account; the wage-labourer is in the employ of the capitalist.
278
Viewed from inside, a more essential difference is seen to reside in the fact that the organisation of labour is, in the capitalist system, more complicated . In so far as the handi- craftsman of the Middle Ages is assisted by journeymen and apprentices, he is obliged to teach them the handicraft; each of them must learn everything connected with the latter. The capitalist, on the other hand, brings together from the outset, in his workshop, a number of labourers for the purpose of producing as many commodities as possible. The instruction imparted to each individual labourer interests him only in so far as such instruction enables the total number employed lo produce more. But it is soon manifest that this purpose is best served by not imparting to the individual too varied and many-sided instruction; but, rather, by giving him a definite partial operation to perform, to which he must inten- sively accustom himself. Then, by means of the systematic cooperation of all, the production is increased. In this way, manufacture arises.
Owing to this systematic cooperation, however, a new factor enters into the process of production, which was pre- viously absent from it. The quantity of products to be turned out is henceforth no longer determined by the sole require- ments of the consumers; but depends also on the necessities of production itself. For instance, in a type manufactory in former times, one founder could cast 2000 types an hour, whereas a breaker could break up 4000 and a rubber could polish 8000. (Comp. Marx, Capital, vol. 1, p. 338, English ed.1). Consequently a column consisting of one rubber, two breakers, and four founders, had to work together. This cooperation, this mutual dependence on one another, requires also that 8000 types be manufactured per hour, and not less; for otherwise, part of the labourers would not be fully em- ployed. Let us assume that only 6000 had to be manufac- tured; in this case, one of the founders would have to be discharged; but the rubber and the two breakers would have to be kept, although they would necessarily Vemain idle part of the time, and thus inflict loss on the capitalist. The result jis, that the capitalist must see that he finds a market for :ypes an hour; otherwise he is unable to fully utilise his apparatus for production, which costs him money and cannot be reduced in size.
i This abridged edition p. 56.
THE ESSENCE OF MARX'S THEORY OF CRISES. 279
We see, therefore, how the connection between production and consumption is progressively dissolved. Already in the early days of the capitalistic era, of which we are now speak- ing, the capitalists see themselves compelled to increase the quantity of their production without any regard for the wants of the consumers. The aim of production is, so to speak, henceforth within itself. Originally, of course, the increase of production was due to the increasing require- ments of the consumers, and the new mechanism of produc- tion was created in view of satisfying this growing demand. Once in existence the new mechanism leads an independent life, and has to function with absolute disregard to the question as to whether its activity merely satisfies the requirements of the consumers, or whether it exceeds them.
Thus, for the first time,
possible.. Such «overproduclion» is here to be understood in the rational sense of the word, as implying _gr oducj j OIL -Q.V e.r and above the requirements, qf the consumers. The connec- tion between producer... ami .consume^ no longer exists, ^the equilibrium fluctuates. But we repeat tKaf "IHTs" development was absolutely necessary in order to engender the forces capable of "saTisTyTng the increased requirements.
The tendencies of the" rupture "oT 'eqtufibrium between production and consumption -- rupture caused, as we have seen, by the respective necessities of both — are clearly mani- fest, and are pushed to their extreme consequences, in our modern capitalist society. There can here be no question of equilibrium. On the one hand, the productive apparatus is immensely vaster, and produces immense quantities of com- modities; consequently it is far less able to adapt itself to the needs of the consumers, than even the manufacturing system was. For instance, if the demand for steel increase to a point at which the existing means of production can no longer satisfy it, it is impossible, in order to meet the in- creased demand, to build a small steel works; the latter must, under all circumstances, be large, for only on that con- dition can it pay. But such a large steel works produces at once a surplus quantity far greater than the quantity corresponding to the increased demand. (Cf. Hilferding, Finanzkapital p. 327.) On the other hand, the labouring class, under the domination of capitalism, receives only a part of the values which the former produces; the difference, there-
280 SUPPLEMENT.
fore, between what the labourers are able to consume, and what they should consume in order that all commodities pro- duced be disposed of, constantly increases owing to the con- tinuation of the developmental process in question, which is continually augmenting the production. Finally we must note that, along with the growth of production, not only does this process become more extensive, but likewise more complicated, and consequently far more susceptible to dis- lurbance. In order to illustrate this truth, we must once more enter into some detail.
When primitive man, living in a virgin forest, feels a want of any sort, let us say a want of food, be sets out to hunt; or else he gathers roots and fruit; and he appeases his hunger with what he kills or finds. To-day, if a man's hunger is to be appeased, a number of intermediary factors come into play. In order to produce the bread on the table before us, the baker had to perform work. But, for this, he requires an oven, together with the necessary apparatus; and also the house in which they are placed. He buys flour from the miller, who grinds the corn in his mill. In order to construct ovens and mills, and the machinery pertaining to them, factories are indispensable; and these factories, in turn, procure iron, timber, coal, in more or less worked-up form from big undertakings, such as mines, etc. In other words, the requirements of modern civilised humanity are not satisfied directly, but very indirectly. The^_£m>ply of bread (and, indeed, of every article of consumption) to the consumer, is but the final link in a long chain consisting chiefly of supplies of means of production by one producer to another. These circuits were necessary in order to bring the abundance of production to its present high level. If a rupture of the equilibrium between production and con- sumption is to be prevented, not only must the baker furnish exactly the amount of bread needed by the consumers; but also the factories must supply the precise number of ovens necessary for the purpose of baking, the mines the precise amount of coal, iron etc. In other words, an exact equili- brium must exist between all the various branches of pro- duction. But this is impossible for the reason already stated; namely, because the process of production, in order to develop the productive forces, must obey its own laws, which derive from its own organisation; and, therefore, it cannot
THE ESSENCE OF AIARX'S THEORY OF CRISES. 281
accommodate itself to the requirements of the consumers. How rigorously exact the equilibrium between the different bran- ches must be, was shown by Marx in the celebrated formulas contained in the second volume of Capital, of which Hilfer- ding gives a good summary in his Finanzkapital (pp. 297 sqq.). We will try by means of a single example to briefly illustrate the meaning of the problem.
If, for the sake of simplicity, we assume that the entire process of production shall only be continued on the same scale as heretofore, /. e. that it shall not be extended, then must the capitalists be in possession of the necessary means of production and subsistence, not in money form, but in na- tura. For money cannot be used by the labourers as food, it cannot weave yarn or melt iron. Consequently, the total available quantity of means of subsistence and production must be distributed among the different branches in such a way, that each of them be in a position to continue produc- ing. If there be anywhere the slightest disharmony, a distur- bance must be the result. In what proportion must the distri- bution be effected?
If, for instance, the capitalists who produce means of consumption (me) are at the end of the year in possession of 3000 me in natura, they must feed their labourers and themselves with them during the coming year; and, in addi- tion, so much must remain over, as can be exchanged for the necessary means of production (nip). Let us assume they need 500 for their workmen, 500 for themselves, whereas they buy mp for the remaining 2000 me.
Through this last transaction, the capitalists who pro- duce mp come into the possession of 2000 me in natura, which they can utilise during the following year for feeding their workmen and themselves. Consequently, the propor- tion being the same as in the group me, they will give their workmen 1000 and retain 1000 for themselves. If, now, the capitalists of the group mp are to continue producing, they must have so much mp over from their former production, as will suffice for the employment of the number of labou- rers who are fed for a year with 1000 me. Assuming the proportional figures to be the same, the quantity of such mp is 4000. In other words; if the production of the group me requires 2000 mp + 500 labour-wages + 500 surplus- value for the capitalists; in order to maintain the equilib-
282 PLEMENT.
riinii, the group nip must have, at its disposal for the pur- pose of production, -KKK) mp -f- liinii labour-wages t loon surplus-value. This is the meaning of the celebrated formula of Marx:
I Mp 4000c + 1000v -f IDOOs fl II Me 2000c -f- 5COv -f 500s — 3000
in which s — surplus-value, v (variable capital) -= labour- wages, and c (constant capital) — means of production. A single glance at this formula suffices to show us that, under the complicated circumstances of capitalist production, such a subtle equilibrium is quite impossible. And yet we have, up to now, only resumed matters very summarily. We have placed all the capitalists who produce mp in a single group, and also all those who produce me. But it is evident that the equilibrium must exist within much more intricate subr divisions of these groups. For instance, those capitalists who manufacture baking ovens must baye at their disposal exactly the quantity of me and of mp adapted to their branch of production as is determined by the requirements of the bakeries. Besides which, we have proceeded on the assumption that the process of production is continued on the same scale, /'. e. that it is not extended; and this never happens in reality. But the constant extension of the process renders the conditions of equilibrium still more subt! complicated. Neither have we taken into consideration the different categories of mp, /. e. the so-called fixed and circu- lating capital; which again, complicates the conditions neces- sary for effecting an equilibrium. And. finally, we bave not taken into consideration the fact that all e if mp
for me, of mp for mp, of me for me, of labour for food, etc. take place through the medium of nr that new disturbing re called into existence by the
rinploymenl of nn»
llms it is certain thai even an ajipi iiilil'imm
between production and consumption cannot he realised iu capitalist society; and that, in consequence, But at the same time we see how necr
turbances are, in view of causing that development of the productive forces by means of which alone the constantly
ing requirements of the consumers can l> •uly question still remaining is: can. in tin
THE ESSENCE OF MARX'S TH/-ORY OF CRISES. 283
solution of these antagonisms, their reconciliation in a higher synthesis, be expected — and, if so, how can ii be brought about?
The answer is given with classical clearness by Engels m the pamphlet, published after his death, entitled Princi- ples of Communism (pp. 18— 21). The immense development of the productive forces which we owe to capitalism was, at the same time, the cause of the complete and at first sight apparently irremediable, rupture of the equilibrium between production and consumption. Crises are the inevitable con- sequence of the fact that the productive forces, in order to develop, can have no regard for the requirements either of the consumers or of other branches of production. Produc- tion must continue, whether a market be available or not, in order to prevent the depreciation of the value of the vast productive apparatus. Under these circumstances, periodi- cally recurring catastrophes are inevitable. But, at the same time, the incfeased forces of production create quantities of commodities which are ever becoming more colossal; and> moreover, they give the possibility of producing still vaster quantities in the future. Thus, the entire meaning of the economic problem has been changed, nay inverted. In past ages the problem to be solved was: how can the require- ments of the consumers be satisfied by production? To-day, on the contrary, it is: how can the immense quantities of commodities, which are easily produced, be rendered acces- sible to the consumers, so as to be effectively consumed? This is the great problem to be solved in a future which is no longer distant. For it is to be feared that the economic structure of modern society will not be able to withstand for long the immense perturbations to which it is continually exposed. Once we are convinced that the solution of the problem cannot and will not be effected on the lines on which alone it has hitherto been sought, namely by means of the limitation of production; that, on the contrary, the prob- lem can only be solved by means of the increase of con- sumption, so that all the commodities produced now and later may be effectively consumed; once these facts are clear to us, boundless and joyful prospects are opened-up. We can then foresee the advent of social conditions under which everyone will be relieved of the burden of material difficulty and distress; and under which, in consequence, mankind will
be able, because its economic existence is assured, to devote itself to new and higher tasks. In this society of the future, personal freedom and the well-beinjj of all without exception will, for the first time ii become realities, and the
individual will, at the same time, he ahl.- lop t'ullv his
personal aptitudes and capacities.
CONTENTS.
CHAPTER PAGE
-Editor's Preface III