Because Richard, like Ricardo, sees money only as currency, he likewise fails to understand this nature of capital. In conditions where there is no overproduction of capital, but where capitalism remains subject to these shorter-term, cyclical overproductions of commodities, whether resulting from disproportions or other frictional obstructions to the circuit of capital, it may be possible to cut short and so minimise the disruption, by various means of Keynesian demand management, as Mandel noted, in relation to the five recessions that occurred, in the post-war period of long-wave expansion running from 1949 to 1974. The fact that consumers may, at a given time, prefer the use-value of money as against the use-value of any of the available commodities they could buy with it, for example, changes when some new commodities become available for them to buy.
Whether that availability arises because those commodities have only just come into production, or because the rising production of those commodities, results in economies of scale that reduces their unit value, or whether, indeed, rising real wages, leave sufficient income for consumers to begin consuming them does not matter. What does matter, in these conditions, is that a partial or generalised overproduction of commodities, itself a consequence of rapidly rising productivity and output, as well as of rising real wages, which results in demand for mature products becoming sated, would result in production stopping until the glut was cleared, and, consequently, workers would be laid off, they would, in turn, have to reduce their consumption, so that overproduction – resulting from a reduction in consumption - then arises in spheres where no actual overproduction existed, i.e. under-consumption.
It was, that kind of condition that existed, for example, in the post-war period of boom, and which Keynesian demand-management was able to resolve. It was a period in which, large numbers of new consumer products were developed, and so, although commodities of one type were overproduced, the availability of new types of commodity, became the focus of demand for consumers who, otherwise, were sitting on their money.
So let me summarise what has been said up to this point, before moving on. Money is not currency/money tokens, just as a cow is not a picture of a cow. Money is the equivalent form of value, and, as such, can only be equal in value to the total value of all other commodities in the economy. From that, it can already be seen that, in terms of paying its way in the world, a country only has a limited amount of money, equal to the value of those commodities. We tend to think of that in terms of the value of commodities produced and to be exchanged each year, but, in reality, countries can and do, also, use the value of their existing assets for that purpose. In the process of the dissolution of the old landed aristocracy, it used the value of its estates, which it sold off piecemeal, having used them as collateral to borrow to fund its conspicuous consumption.
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