Book: Freeland

T >> Theodor Hertzka >> Freeland




This first social order yielded, not to moral or philosophical
considerations, but to a change in the character of labour. The man who
first thought of sowing corn and reaping it was the deliverer of mankind
from the lowest, most sanguinary stage of barbarism, for he was the first
producer--he first practised the art not only of collecting, but of
producing, food. When this art so improved as to make it possible to
withdraw from the worker a part of his produce without positively exposing
him to starvation, it was gradually found to be more profitable to use the
vanquished as beasts of labour than as beasts for slaughter. Since slavery
thus for the first time made it possible for at least a favoured few to
enjoy abundance and leisure, it became the first promoter of higher
civilisation. But civilisation is power, and so it came about that slavery
or servitude in one form or another spread over the world.

But it by no means follows that the domination of servitude must, or even
can, be perpetual. Just as cannibalism--which was the result of that
minimum productiveness of human labour by means of which the severest toil
sufficed to satisfy only the lowest animal needs of life--had to succumb to
servitude as soon as the increasing productiveness of labour made any
degree of abundance possible, so servitude--which is nothing else but the
social result of that medium measure of productiveness by which labour is
able to furnish abundance and leisure to a few but not to all--_must_ also
succumb to another, a higher social order, as soon as this medium measure
of productiveness is surpassed, for from that moment servitude has ceased
to be a necessity of civilisation, and has become a hindrance to its
progress.

And for generations this has actually been the case. Since man has
succeeded in making the forces of nature serviceable in production--since
he has acquired the power of substituting the unlimited elemental forces
for his own muscular force--there has been nothing to prevent his creating
abundance and leisure for all; nothing except that obsolete social
institution, servitude, which withholds from the masses the enjoyment of
abundance and leisure. We not merely can, but we shall be compelled to make
social justice an actual fact, because the new form of labour demands this
as imperatively as the old forms of labour demanded servitude. Servitude,
once the vehicle of progress, has become a hindrance to civilisation, for
it prevents the full use of the means of civilisation at our disposal. As
it reduces to a minimum the things consumed by most of our brethren, and
therefore does not call into play more than a very small part of our
present means of production, it compels us to restrict our productive
labour within limits far less than those to which we should attain if an
effective demand existed for what would then be the inevitable abundance of
all kinds of wealth.

I sum up thus: Economic equality of rights could not be realised in earlier
epochs of civilisation, because human labour was not then sufficiently
productive to supply wealth to all, and equality therefore meant poverty
for all, which would have been synonymous with barbarism. Economic equality
of rights not only can but _must_ now become a fact, because--thanks to the
power which has been acquired of using the forces of nature--abundance and
leisure have become possible for all; but the full utilisation of the now
acquired means of civilisation is dependent on the condition that everyone
enjoys the product of his own industry.

SATZA-MUNI (_Right_): I think it has been incontrovertibly shown that
economic equality of rights was formerly impossible, and that it _can_ now
be realised; but why it _must_ now be realised does not seem to me to have
been yet placed beyond a doubt. So long as the productiveness of labour was
small, the exploitation of man by man was a necessity of civilisation--that
is plain; this is no longer the case, since the increased productiveness of
labour is now capable of creating wealth enough for all--this is also as
clear as day. But this only proves that economic justice has become
possible, and there is a great difference between the possible and the
necessary existence of a state of things. It has been said--and the
experience of the exploiting world seems to justify the assertion--that
full use cannot be made of the control which science and invention have
given to men over the natural forces, while only a small part of the fruits
of the thus increased effectiveness of labour is consumed; and if this can
be irrefutably shown to be inherent in the nature of the thing, there
remains not the least doubt that servitude in any form has become a
hindrance to civilisation. For an institution that prevents us from making
use of the means of civilisation which we possess is in and of itself a
hindrance to civilisation; and since it restrains us from developing wealth
to the fullest extent possible, and wealth and civilisation are power, so
there can consequently be no doubt as to why and in what manner such an
institution must in the course of economic evolution become obsolete. The
advanced and the strong everywhere and necessarily imposes its laws and
institutions upon the unprogressive and the weak; economic justice would
therefore--though with bloodless means--as certainly and as universally
supplant servitude as formerly servitude--when it was the institution which
conferred a higher degree of civilisation and power--supplanted
cannibalism. I have already admitted that the modern exploiting society is
in reality unable to produce that wealth which would correspond to the now
existing capacity of production: hence it follows as a matter of fact that
the exploiting society is very much less advanced than one based upon the
principle of economic justice, and it also quite as incontrovertibly
follows that the former cannot successfully compete with the latter.

But before we have a right to jump to the conclusion that the principles of
economic justice must necessarily be everywhere victorious, it must be
shown that it is the essential nature of the exploiting system, and not
certain transitory accidents connected with it, which makes it incapable of
calling forth all the capacity of highly productive labour. Why is the
existing exploiting society not able to call forth all this capacity?
Because the masses are prevented from increasing their consumption in a
degree corresponding to the increased power of production--because what is
produced belongs not to the workers but to a few employers. Right. But, it
would be answered, these few would make use of the produce themselves. To
this the rejoinder is that that is impossible, because the few owners of
the produce of labour can use--that is, actually consume--only the smallest
portion of such an enormous amount of produce; the surplus, therefore, must
be converted into productive capital, the employment of which, however, is
dependent upon the consumption of those things that are produced by it.
Very true. No factories can be built if no one wants the things that would
be manufactured in them. But have the masters really only this _one_ way of
disposing of the surplus--can they really make no other use of it? In the
modern world they do as a matter of fact make no other use of it. As a
rule, their desire is to increase or improve the agencies engaged in
labour--that is, to capitalise their profits--without inquiring whether
such an increase or improvement is needed; and since no such increase is
needed, so over-production--that is, the non-disposal of the produce--is
the necessary consequence. But because this is the fact at present, _must_
it necessarily be so? What if the employers of labour were to perceive the
true relation of things, and to find a way of creating an equilibrium by
proportionally reducing their capitalisation and increasing their
consumption? If that were to happen, then, it must be admitted, all
products would be disposed of, however much the productiveness of labour
might increase. The consumption by the masses would be stationary as
before; but luxury would absorb all the surplus with exception of such
reserves as were required to supply the means of production, which means
would themselves be extraordinarily increased on account of the enormously
increased demand caused by luxury.

And who will undertake to say that such a turn of affairs is altogether
impossible? The luxury of the few, it is said, cannot possibly absorb the
immense surplus of modern productiveness. But why not? Because a rich man
has only one stomach and one body; and, moreover, everyone cannot possibly
have a taste for luxury. Granted; luxury, in its modern forms, cannot
possibly consume more than a certain portion of the surplus produce of
modern labour. But are we shut up to these modern kinds of luxury? What if
the wealthy once more have recourse to a mode of spending repeatedly
indulged in by antiquity in order to dispose of the accumulating proceeds
of slave-labour? In ancient Egypt a single king kept 200,000 men busy for
thirty years building his sepulchre, the great pyramid of Ghizeh. This same
Pharaoh probably built also splendid palaces and temples with a no less
profligate expenditure of human labour, and amassed treasures in which
infinite labour was crystallised. Contemporaneously with him, there were
other Egyptian magnates, priests, and warriors in no small number, who
sought and found in similar ways employment for the labour of their slaves.
If the luxury of the living did not consume enough, then costly spices,
drink-offerings and burnt-offerings were lavished upon the dead, and thus
the difficulty of disposing of the accumulated produce of labour was still
further lightened. And this succeeded admirably. The Egyptian slave
received a few onions and a handful of parched corn for food, a loin-cloth
for clothing; and yet, notwithstanding a comparatively highly developed
productiveness of the labour of countless slaves exploited by a few
masters, there was no over-production. In ancient India the men in power
excavated whole ranges of hills into temples, covered with the most
exquisite sculptures, in which an infinite amount of labour was consumed;
in ancient Rome the lords of the world ate nightingales' tongues, or
instituted senseless spectacles, in order to find employment for the
superfluous labour of countless slaves who, despite the considerable
productiveness of labour, were kept in a condition of the deepest misery.
And it answered. Why should not such a course answer in modern times?
Because, thanks to the control we have acquired over nature, the
productiveness of labour has become infinitely greater. Labour may have
become infinitely more productive; indeed, I think it probable that it is
no longer possible for the maddest prodigality of the few wealthy to give
_full_ employment to the whole of the labour-energy at present existing
without admitting the masses to share in the consumption; but it would be
possible for the wealthy to consume a very large portion of the possible
produce. Then why does the modern exploiting society build no pyramids, no
rock palaces; why do the lords of labour institute no costly cultus of the
dead; why do they not eat nightingales' tongues, and keep the exploited
populace busy with circus spectacles and mock sea-fights? They could
indulge in these and countless other things, if they only discovered that
the surplus must be consumed and not capitalised. But as long as they
continue to multiply the instruments of labour, and only the instruments of
labour, so long are they simply increasing over-production, and can become
richer only in proportion as the consumption accidentally increases. As
soon, however, as they adopt the above-mentioned expedient, the connection
between their wealth and the lot of the masses is broken. Why does not this
happen?

I hope it is not necessary for me expressly to assert that I am far from
wishing for such a turn in affairs; rather, I should look upon it as the
greatest misfortune that could befall mankind, for it would mean that,
despite the enormously increased productiveness of labour, exploitation was
not necessarily a hindrance to civilisation, and consequently would not
necessarily be superseded by economic justice. But Confucius says rightly,
that what is to be deplored is not always to be regarded as impossible or
even as only improbable.

JOHN BELL (_Centre_): The last speaker, who in other respects shows himself
to be a profound thinker, overlooks the fact that the completest
utilisation of the existing means of civilisation and the corresponding
evolution of wealth are not the only determining criteria in the struggle
for existence among nations. The strength of a nation that employs its
wealth in fostering the higher development of the millions of its subjects,
will ultimately become very different from that of a nation which consumes
an equal amount of wealth merely in increasing the enjoyment, nay, the
senseless luxury, of the ruling classes.

ARISTID-KOLOTRONI (_Centre_): The last speaker is correct in what he says,
although it may be objected that the wealthy are not necessarily obliged to
consume their wealth in senseless luxury: they might just as well gratify
their pride by boundless benevolence, accompanied by enormous expenditure
in all imaginable kinds of scientific, artistic and other institutions of
national utility. But I think we are getting away from the main point,
which is: is such a turn of affairs possible? The fact that it has not
occurred, despite all the evils of over-production, that on the contrary a
continually growing desire to capitalise all surplus profits dominates the
modern world, should save us from a fear of such a contingency.

KURT OLAFSOHN (_Freeland_): I must agree with Satza-Muni, the honourable
member for Japan, so far as to admit that the bare fact that such a
contingency has not yet been realised cannot set our minds completely at
rest. The consideration advanced by the two following speakers as to
whether an exploiting society in which the consumption by the wealthy
increases indefinitely must, under all circumstances, succumb to the
influence of the free order of society, appears arbitrary and inconclusive.
I venture to think that the free society does not possess the aggressive
character of the exploiting society, and that therefore the latter, even
though it should prove to be decidedly the weaker of the two, may continue
to exist for some time side by side with the other so far as it does not
itself recognise the necessity of passing over to the other. And this
recognition would be materially delayed by the fact that the ruling classes
profit by the continuance of exploitation. The change could then be
effected universally only by sanguinary conflicts, whilst we lay great
stress upon the winning over of the wealthy to the side of the reformers.
It is the enormous burden of over-production that opens the eyes of
exploiters to the folly of their action; should this spur be lacking, the
beneficial revolution would be materially delayed. The member for Japan is
also correct in saying that repeatedly in the course of history the surplus
production which could not be consumed in a reasonable manner has led the
exploiting lords of labour to indulge in senseless methods of consumption.
It may therefore be asked whether what has repeatedly happened cannot
repeat itself once more; but a thorough investigation of the subject will
show that the question must be answered with a decided _No_.

No, it _can_ never happen again that full employment for highly productive
labour will be found except under a system of economic justice; for since
it last occurred, a new factor has entered into the world which makes it
for all times an impossibility. This factor is the mobilisation of capital
and the consequent separation of the process of capital formation from the
process of capital-using. Anyone who in Ancient Egypt or Ancient Rome had
surplus production to dispose of and wished to invest it profitably,
therefore in the form of aids to labour, must either himself have had a
need of aids to labour, or must have found someone else who had such a need
and was on that account prepared to take his surplus, at interest of
course. It was impossible for anyone to invest capital unless someone could
make use of such capital; and if this latter contingency did not occur, it
was a matter of course that the possessor of the surplus production,
unusable as capital, should seek some other mode of consuming it. Many such
modes offered themselves, differing according to the nature of the several
kinds of exploiting society. If the constitution of the commonwealth was a
patriarchal one, the labour which had become more productive would be
utilised in improving the condition of the serfs, in mitigating the
severity of their labour. In a commonwealth of a more military character
the increasing productiveness of labour would serve to enlarge the
non-labouring, weapon-bearing class. If--as was always the case when
civilisation advanced--the bond between lord and serf became laxer, the
lord merely increased his luxury. But, in any case, the surplus which could
not be utilised in the augmentation or improvement of labour was consumed,
and there could therefore be no over-production. As now, however, the
possessor of surplus produce can--even when no one has a need of his
savings--obtain what he wants, viz. interest, he has ceased to concern
himself as to whether that surplus is really required for purposes of
production, but is anxious to capitalise even that which others can make as
little use of as he can.

And this, in reality, is the result of the mobilisation of capital. Since
this discovery has been made, all capital is as it were thrown into one
lump, the profits of capital added to it, and the whole divided among the
capitalists. No one needs my savings, they are absolutely superfluous, and
can bear no fruit of any kind; nevertheless I receive my interest, for the
mobilisation of capital enables me to share in the profits of
profit-bearing, that is, of really working, capital. I deposit my savings
at interest in a bank, or I buy a share or a bill and thereby raise the
price of all other shares or bills correspondingly, and thus make it appear
as if the capital which they represent had been increased, while in truth
it has remained unchanged. And the produce of this working capital has not
increased through the apparent addition of my capital; the interest paid on
the whole amount of capital including mine is not more than that paid on
the capital before mine was added to it. The addition of my superfluous
capital has lowered the _rate_ of interest, or, what comes to the same
thing, has raised the price of a demand for the same rate of interest as
before; but even a diminished rate of interest is better than no interest
at all. I continue, therefore, to save and capitalise, despite the fact
that my savings cannot be used productively as capital; nay, the
above-mentioned diminution of the rate of interest impels me, under certain
circumstances, to save yet more carefully, that is, to diminish my
consumption in proportion as my savings become less remunerative. It is
evident that my surplus produce cannot find any productive employment at
all, yet there is no way out of this circle of over production. Luxury
cannot come in as a relief, because the absence of any profitable
employment for the surplus renders that surplus valueless, and the ultimate
result is the non-production of the surplus. Only exceptionally is there an
actual production of unconsumable and, consequently, valueless things; the
almost unbroken rule is that the things which no one can use, and which
therefore are valueless, will not be produced. Since the employer leaves to
the worker only a bare subsistence, and can apply to capitalising purposes
only so much as is required for the production of consumable commodities,
every other application of the profits being excluded by capitalism, he
cannot produce more than is enough to meet these two demands. If he
attempts to produce more, the inevitable result is not increased wealth,
but a crisis.

We have, therefore, no ground to fear that the ruling classes will again,
as in pro-capitalistic epochs, be able to enjoy the fruits of the
increasing productiveness of labour without allowing the working masses to
participate in that enjoyment. Capitalism, though by no means--as some
socialistic writers have represented--the cause of exploitation, is the
obstacle which deprives modern society of every other escape from the fatal
grasp of over-production but that of a transition to economic justice. It
is the last stage in human economics previous to that of social justice.
From capitalism there is no way forward but towards social justice; for
capitalism is at one and the same time one of the most effectual
provocatives of productivity and the bond which indissolubly connects the
increase of the effective production of wealth with consumption.

WILHELM OHLMS (_Right_): Then how is it that the Freeland institutions,
which are to become those of the whole of civilised mankind, have broken
with capitalism?

HENRI FARR (_Freeland_): So far as by capitalism is to be understood the
conversion of any actual surplus production into working capital, we in
Freeland are far from having broken with it. On the contrary, we have
developed it to the utmost, for much more fully than in the exploiting
capitalistic society are our savings at all times at the disposal of any
demand for capital that may arise. But our method of accumulating and
mobilising capital is a very different and much more perfect one: the
solidarity of interest of the saver with that of the employer of capital
takes the place of interest. This form of capitalism can never lead to
over-production, for under it--as in the pre-capitalistic epoch--it is the
demand for capital that gives the first impulse to the creation of capital.
But that this kind of capitalisation is impracticable in an exploiting
society needs no proof. For such a society there is no other means of
making the spontaneously accumulating capital serviceable to production
than that of interest; and as soon as the mobilisation of capital dissolves
the immediate personal connection between saver and employer of capital,
creditor and debtor, interest inevitably impels to over-production, from
which there is no escape except in economic justice--or relapse into
barbarism. [Loud and general applause.]

The PRESIDENT here asked if anyone else wished to speak upon point 1 of the
Agenda; and, as no one rose, he declared the discussion upon this subject
closed.

The Congress next proceeded to discuss point 2:--

_Is not the success of the Freeland institutions to be attributed merely to
the accidental and therefore probably transient co-operation of specially
favourable circumstances; or do those institutions rest upon conditions
universally present and inherent in human nature?_

GEORGE DARE (_Right_) opened the debate: We have the splendid success of a
first attempt to establish economic justice so tangibly before us in
Freeland, that there is no need to ask whether such an attempt _can_
succeed. It is another question whether it _must_ succeed, and that
everywhere, because it has succeeded in this one case. For the
circumstances of Freeland are exceptional in more than one respect. Not to
mention the pre-eminent abilities, the enthusiasm and the spirit of
self-sacrifice which marked the men who founded this fortunate
commonwealth, and some of whom still stand at its head, men such as it is
certain will not everywhere be found ready at hand, it must not be
overlooked that this country is more lavishly endowed by nature than most
others, and that a broad band of desert and wilderness protected it--at
least at first--from any disturbing foreign influence. If men of talent,
enjoying the unqualified confidence of their colleagues, are able on a soil
where every seed bears fruit a hundredfold to effect the miracle of
conjuring inexhaustible wealth for millions out of nothing, of
exterminating misery and vice, of developing the arts and sciences to the
fullest extent,--all this is, in my opinion, no proof that ordinary men,
given perhaps to squabbling with each other, and to being mutually
distrustful, will achieve the like or even approximately similar results on
poorer land and in the midst of the turmoil of the world's competitive
struggle. My doubts upon this point will appear the more reasonable when it
is remembered that in America we have witnessed hundreds upon hundreds of
social experiments which have all either proved to be in a greater or less
degree miserable fiascos, or at least have only assumed the proportion of
isolated successful industrial enterprises. It is true that some of our
efforts at revolutionising modern society have had remarkable pecuniary
results; but that has been all: a new, practicable foundation of the social
organisation they have not furnished, not even in germ. I wished to give
expression to these doubts; and before allowing ourselves to be intoxicated
by the example of Freeland, I wished to invite you to a sober consideration
of the question whether that which is successful in Freeland must
necessarily succeed in the rest of the world.

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