Friday 15 October 2021

A Characterisation of Economic Romanticism, Chapter 1 - Part 67

XI - Sismondi’s Place in the History of Political Economy


Sismondi differed from the classical economists in that he pointed out the contradictions of capitalism. But he did not go beyond the analysis of capitalism provided by the classical economists, and in many ways lagged behind it. By failing to go beyond their analysis, he was unable to see, as Marx did, or even as others such as Ramsay or Jones did, to a degree, that capitalism is only transitory, and that there is, therefore, progress beyond it. Seeing things from the perspective of the petty-bourgeoisie, Sismondi is unable and/or unwilling to consider a society beyond capitalism, and can only, therefore, form his analysis in terms of what he sees as preceding it, i.e. a society of small, independent, commodity producers. This is the same perspective as the Narodniks, or today the Miseans, and, effectively, of the “anti-capitalists”, and “anti-imperialists”. All of these petty-bourgeois trends are left simply bemoaning the horrors of capitalism, which they interpret as large-scale, industrial capital, and so fail to recognise its fundamentally progressive character.

“This substitution of sentimental complaints and lamentations for a scientific analysis results in his conception being extremely superficial. Modern theory accepted his references to the contradictions of capitalism, subjected them to a scientific analysis, and on all points reached conclusions which radically differ from Sismondi’s, and for that reason lead to a diametrically opposite point of view concerning capitalism.” (p 199)

Lenin quotes Marx's comment on Sismondi in “A Contribution to The Critique of Political Economy”,

“Sismondi is no longer labouring under Boisguillebert’s idea that labour which creates exchange value is adulterated by money; but just as Boisguillebert denounced money, so does Sismondi denounce large industrial capital” (p. 36).” (p 199-200)

In other words, Boisguillebert thought that barter was the natural system, and that it was then money that was unnatural, and imposed from the outside. In fact, of course, as Marx shows in “A Contribution to The Critique of Political Economy”, in Capital I, Chapter 3, and in Theories of Surplus Value, Chapter 20, money is the inevitable result of commodity exchange. Marx points out in Theories of Surplus Value, Chapter 4, that every commodity is money.

“That it is labour that manifests itself in the product already implies that the product is equal to a definite quantity of general social labour. As against the Physiocrats, Adam Smith re-establishes the value of the product as the essential basis of bourgeois wealth; but on the other hand he divests value of the purely fantastic form—that of gold and silver—in which it appeared to the Mercantilists. Every commodity is in itself money.”

In other words, every commodity has exchange-value, and so can act as the equivalent form of value of every other commodity. This is what Marx sets out in his Value Form Analysis in Capital I, Chapter 3. I can buy any commodity with some other commodity, in my possession, of equal value, provided the seller is prepared to accept it. That is why, even if corn is not the money commodity, it is possible to express the value of some other commodity, such as wine, in terms of a corn price, i.e. the amount of corn that represents an equivalent amount of value. This is the basis of barter. If a litre of wine has a value of 10 hours, and a kilo of corn has a value of 10 hours then the corn price of a litre of wine is 1 kilo. If the wine seller agrees, I can buy the wine with my kilo of corn.

And, as Marx establishes, it is these exchanges which see some regularly traded commodities, whose value is well known, become the measure of the value of other commodities. Competition between buyers and sellers establishes these exchange proportions, because any discrepancies are shown up, as surpluses or losses for sellers. These regularly traded commodities take on the role of equivalent form of value, so that instead of measuring value directly in terms of labour-time, it becomes measured indirectly in terms of quantities of these commodities. Eventually, just one of these commodities becomes singled out as the universal equivalent form of value, the money commodity. However, as Marx says this is merely a “purely fantastic form” of value. Underlying exchange, even in a money economy, is the fact that commodities are bought with commodities, because this same truth underlies the exchange that it is only the equal value of the commodities that enables the exchange to take place. If I exchange 1 kilo of corn, for £1, and then exchange this £1 for a litre of wine, this is only possible because 1 kilo of corn has the same value as, is equal to, 1 litre of wine, that is they represent equal amounts of social-labour-time. The £1 also represents the same amount of social labour-time, and so it does not matter whether this £1 is in the form of a quantity of gold, a coin acting as token of this gold, or simply a scrap of paper, that gives the owner a claim on that same amount of social labour-time, i.e. a bank note.

So, contrary to Boisguillebert, money is the natural product of commodity exchange. Similarly, capital is the natural consequence of money. No sooner has money arisen than it can be hoarded, and then used as interest-bearing capital, by being loaned out at interest, or can be used as commercial capital. And, when commodity exchange reaches a sufficient degree of development, with the growth of large concentrated markets, in towns, the competition between commodity producers leads inevitably to the development of productive-capital, as some producers are able to undercut others by producing capitalistically. Finally, once such capitalist production has started, it inevitably leads to the large-scale industrial capital that Sismondi objects to, because the larger the capital the more efficiently it produces, and so undercuts any smaller capitalist producers.

“Boisguillebert did not understand the inseparable and natural connection between money and commodity exchange, did not understand that he was contrasting two forms of “bourgeois labour” as extraneous elements (ibid., pp. 30-31). Sismondi failed to understand the inseparable and natural connection between big capital and small independent production, failed to understand that these are two forms of commodity economy...Sismondi is up in arms against big capital, i.e., against commodity economy in one form, its most developed form, while, utopian-like, he praises the small producer (especially the peasantry), i.e., commodity economy in another form, its rudimentary form.” (p 200)


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