“Here again there is the childish conception of the rent, etc., coming back, as there was above of the drawing back of the whole of the wages.” (p 275)
In other words, the industrial capitalist hands over £100 in rent or interest to the landowner or money-capitalist. These idle capitalists then buy £100 of commodities from the industrial capitalists, so that they “draw back” this £100. But, they achieve this “drawing back” only by handing over £100 of commodities to the idle capitalists instead! Even if they hand back only £80 in value, in exchange for this £100, they have only, in effect, reduced the amount they have handed to the idle capitalists to £80.
Destutt himself has said that rent and interest are only a deduction from the industrial profit, and so had this £100 not been deducted in the first place, it would not have needed to have been drawn back. Therefore, even had the industrial capitalist drawn back the entire £100, without giving any commodities to the idle capitalists in exchange, they would have only set this deduction from their profit to zero, rather than in any way added to it.
But, there is a further absurdity in Destutt's argument, yet one that is reflected in actual history. Suppose a landlord receives £100 in rent from an industrial capitalist. The landlord buys commodities from the capitalist with this £100. But, the capitalist sells commodities to him with a value of £80. The landlord, however, needs commodities with a value of £100. So, they sell a portion of their land to raise the additional £25 required to buy the additional commodities (they need to buy 25% more, which means £25 more than the £100 they have already paid.)
The buyers of this land will be the productive-capitalists. Over time, therefore, all of the land will pass out of the hands of the idle landowners and into the hands of the productive-capitalists. But, at this point, the idle landowners will have no rent as revenue, and no means to buy commodities from the industrial capitalists. But, this process did, in fact, occur in history, as Marx describes.
“And Monsieur Destutt is quite right up to a certain point, although not at all in what he wants to explain. In the period of the declining Middle Ages and rising capitalist production the rapid enrichment of the industrial capitalists is in part to be explained by the direct fleecing of the landlords. As the value of money fell, as a result of the discoveries in America, the farmers paid them nominally, but not really, the old rent, while the manufacturers sold them commodities above their value —not only on the basis of the higher value of money.” (p 276-7)
Something similar has occurred more recently. As the prices of financial assets, fictitious capital, (shares, bonds, property) bubbled to ever higher levels, so the yields on these assets fell lower and lower towards zero. Instead of being concerned over the revenue these assets might produce, their owners became concerned only with the potential capital gains, arising from the ever higher prices. Pension funds, depend upon the revenue from such assets to cover their future pension liabilities to pensioners, but as yields fell, they too saw the means of paying pensions being from out of these large capital gains, but which could only be realised by selling some of the underlying financial assets. In other words, current liabilities were met by undermining the capital base of the pension fund, which then led to inadequate capital in the pension fund to cover future liabilities, particularly as yields on those assets fell to near zero.
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