Capitalism; Imperialism; Saving and investment; Socialism
'A solitary farmer in a distant colony on the border of the desert has
reaped 100 sacks of corn this year; there is no market where to bring
them; this corn, in any case, must be consumed within the year, else it
will be of no value to the farmer; yet the farmer and his family eat
only 30 sacks of it; this will be his expenditure, constituting the
exchange of his income; it is not reproduced for anybody whatever. Then
he will call for workers, he will make them clear woods, and drain
swamps in his neighbourhood and put part of the desert under the plough.
These workers will eat another 30 sacks of corn: this will be their
expenditure; they will be in a position to afford this expenditure at
the price of their revenue, that is to say their labour; for the farmer
it will be an exchange: he will have converted his 30 sacks into fixed
capital. In the end, he is left with 40 sacks. He will sow them that
year, instead of the 20 he had sown the previous year; this constitutes
his circulating capital which he will have doubled. Thus the 100 sacks
will have been consumed, but of these 100 sacks 70 are a real investment
for him, which will reappear with great increase, some of them at the
very next harvest, and the others in all subsequent harvests.--The very
isolation of the farmer we have just assumed gives us a better feeling
for the limitations of such an operation. If he has only found consumers
for 60 of the 100 sacks harvested in that year, who is going to eat the
200 sacks produced the following year by the increase in his sowing? His
family, you might say, which will increase. No doubt; but human
generations do not multiply as quickly as subsistence. If our farmer had
hands available to repeat this assumed process each year, his corn
harvest will be doubled every year, and his family could at the most be
doubled once in 25 years.'[169]
Though the example is naïve, the vital question stands out clearly in
the end: where are the buyers for the surplus value that has been
capitalised? The accumulation of capital can indefinitely increase the
production of the society. But what about the consumption of society?
This is determined by the various kinds of income. Sismondi explains
this important subject in chapter v of book ii, 'The Distribution of the
National Income Among the Various Classes of Citizens', in a resumed
effort to describe the components of the social product.
'Under this aspect, the national income is composed of two parts and no
more; the one consists in annual production ... the profit arising from
wealth. The second is the capacity for work which springs from life.
This time we understand by wealth both territorial possessions and
capital, and by profit the net income accruing to the owners as well as
the profit of the capitalist.'[170]
Public-domain text, read in full here on John Shaqi.
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