'Crises of any kind,' was the answer, 'would certainly dissolve the whole complex of the Freeland institutions; but here they are impossible, for lack of the source from which they elsewhere spring. The cause of all crises, whether called production-crises or capital-crises, lies simply in over-production--that is, in the disproportion between production and consumption; and this disproportion does not exist among us. In fact, the starting-point of the Freeland social reform is the correct perception of the essential character of over-production arrived at twenty-six years ago by the International Free Society. Until then--and in the rest of the world it is still the case--the science of political economy found in this phenomenon an embarrassing enigma, with which it did not know how better to deal than to deny its existence. There was no real over-production--that is, no general non-consumption of products--so taught the orthodox political economists; for, they contended, men labour only when induced to do so to supply a need, and it is therefore impossible in the nature of things that more goods should be produced than can be consumed. And, on our supposition, to which I will refer presently, this is perfectly correct. Everyone will use what he produces to meet a certain need; he will either use his product himself or will exchange it for what another has produced. It matters not what that other product is, it is at any rate something that has been produced; the question never need be what kind of product, but only whether some product is asked for. Let us assume that an improvement has taken place in the production of wheat: it is possible that the demand for wheat will not increase in proportion to the possibility of increasing its production, for it is not necessary that the producers of wheat should use their increased earnings in a larger consumption of wheat. But then the demand for something else would correspondingly increase--for example, for clothing, or for tools; and if this were only known in time, and production were turned in that direction, there would never be a disturbance in the exchange-relations of the several kinds of goods. Thus the orthodox doctrine explains crises as due not to a surplus of products in general, not to a mere disproportion between production and consumption, but to a transient disturbance of the right relation between the several kinds of production; and it adds that it is simply paradoxical to talk of a deficient demand in view of the misery prevailing all over the world.