Marx, then, examines what Proudhon claims are the “economic” reasons for gold and silver achieving the status of money, prior to other commodities, as a result of their value being “constituted” first. All of these reasons, given by Proudhon, amount to nothing more than vague restatements, using other words for the assumption he needed to validate.
“These economic reasons are: the “visible tendency to become dominant,” the “marked preferences” even in the “patriarchal period,” and other circumlocutions about the actual fact – which increase the difficulty, since they multiply the fact by multiplying the incidents which M. Proudhon brings in to explain the fact.” (p 78)
And Marx quotes another reason given by Proudhon, which shows the way he gets things back to front.
“Money is born of sovereign consecration: the sovereigns take possession of gold and silver and affix their seal to them.” (p 78)
Marx notes,
“Thus, the whim of sovereigns is for M. Proudhon the highest reason in political economy.” (p 78)
There is a lesson, here, from Marx to the Stalinists and statists, including today's economic nationalists, proponents of MMT etc. He says,
“Truly, one must be destitute of all historical knowledge not to know that it is the sovereigns who in all ages have been subject to economic conditions, but they have never dictated laws to them. Legislation, whether political or civil, never does more than proclaim, express in words, the will of economic relations.
Was it the sovereign who took possession of gold and silver to make them the universal agents of exchange by affixing his seal to them? Or was it not, rather, these universal agents of exchange which took possession of the sovereign and forced him to affix his seal to them and thus give them a political consecration?
The impress which was and is still given to money is not that of its value but of its weight. The stability and authenticity M. Proudhon speaks of apply only to the standard of the money; and this standard indicates how much metallic matter there is in a coined piece of silver.” ( 78-9)
It is not possible, however, to know the value of an ounce of silver, simply from its weight. To know its value, I must know how much universal labour it represents, and to know its exchange-value, I must know in what proportion this value stands to that of other commodities such as wool, linen, wine etc. A jumper might bear the label “pure wool”, but this cannot tell me its value, without knowing the value of wool and so on, Marx says. Similarly, a coin thrown into circulation, by a sovereign, - be it an absolute monarch or a bourgeois-democratic state, or workers' state – cannot have its value determined simply by an impress upon it.
Marx quotes Proudhon's example of Philip I, and responds,
“It has been proved times without number that, if a prince takes into his head to debase the currency, it is he who loses. What he gains once at the first issue he loses every time the falsified coinage returns to him in the form of taxes, etc. But Philip and his successors were able to protect themselves more or less against this loss, for, once the debased coinage was put into circulation, they hastened to order a general re-minting of money on the old footing.” (p 79-80)
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