IV. EXCHANGE…

IV. EXCHANGE

Exchange is Political Economy—it is Society itself—for it is impossible to conceive Society as existing without Exchange, or Exchange without Society. I shall not pretend in this chapter to exhaust so vast a subject. To present even an outline of it would require the entire volume.

If men, like snails, lived in complete isolation, if they did not exchange their ideas and exertions, and had no bargain or transactions with each other, we might have multitudes, indeed—human units—individuals living in juxtaposition—but we could not have ‹Society›.

Nay, we should not even have individuals. To man isolation is death. But then, if he cannot live out of society, the legitimate conclusion is that the social state is his natural state.

All the sciences tend to establish this truth, which was so little understood by the men of the eighteenth century that they founded morals and politics on the contrary assertion. They were not content with placing the state of nature in opposition to the social state—they gave the first a decided preference. “Men were blessed,” said Montaigne, “when they lived without bonds, without laws, without language, without religion.” And we know that the system of Rousseau, which exercised, and still exercises, so powerful an influence over opinions and facts, rests altogether on this hypothesis—that men, unhappily, ‹agreed› one fine morning to abandon the innocent ‹state of nature› for the stormy ‹state of society›.

It is not the design of this chapter to bring together all possible refutations of this fundamental error, the most fatal which has ever infested the political sciences; for if society is the fruit of invention and convention, it follows that every one may propose a new model, and this, since Rousseau’s time, has in fact been the [p098] direction in which men’s minds have tended. I could easily demonstrate, I believe, that isolation excludes language, as the absence of language excludes thought; and man, deprived of thought, instead of being a child of nature, ceases to be man at all.

But a peremptory refutation of the idea upon which Rousseau’s doctrine reposes, flows naturally from some considerations on Exchange.

‹Want›, ‹Effort›, ‹Satisfaction›,—such is man in an economical point of view.

We have seen that the two extreme terms are essentially intransmissible, for they terminate in sensation, they are sensation, which is the most personal thing in the world, as well the sensation which precedes the effort and determines it, as the sensation which follows the effort and rewards it.

It is then the ‹Effort› which is exchanged; indeed, it cannot be otherwise, since exchange implies action, and Effort alone manifests the principle of activity. We cannot suffer or enjoy for one another, unless we could experience personally the pains and pleasures of others. But we can assist each other, work for one another, render reciprocal ‹services›, and place our faculties, or the results of their exercise, at the disposal of others, in consideration of a return. This is society. The causes, the effects, the laws, of these exchanges constitute the subject of political and social economy.

We not only can exchange efforts and render reciprocal services, but we do so necessarily. What I affirm is this, that our organization is such that we are obliged to work for one another under pain of death, of instant death. If it be so, society is our state of nature, since it is the only state in which we can live at all.

There is one observation which I have to make upon the equilibrium between our wants and our faculties, an observation which has always led me to admire the providential plan which regulates our destinies:—

‹In the state of isolation our wants exceed our powers;›

‹In the social state our powers exceed our wants.›

Hence it follows that man in an isolated state cannot subsist, whilst in the social state his most imperious wants give place to desires of a higher order, and continue to do so in an ascending career of progress and improvement to which it is impossible to set limits.

This is not declamation, but an assertion capable of being [p099] rigorously demonstrated by reasoning and analogy, if not by experience. And why can it not be demonstrated by experience, by direct observation? Precisely because it is true—precisely because, man not being able to exist in a state of isolation, it becomes impossible to exhibit in actual nature the effects of absolute solitude. You cannot lay hold of a nonentity. You can prove to me that a triangle never has four sides, but you cannot, in support of your demonstration, place before my eyes a tetragonal triangle. If you could, the exhibition of such a triangle would disprove your assertion. In the same way, to ask me for experimental proof, to ask me to study the effects of isolation in actual nature, is to palm a contradiction upon me; for life and isolation being incompatible, we have never seen, and never shall see, men without social relations.

If there are animals (of which I am ignorant) destined by their organization to make the round of their existence in absolute isolation, it is very clear that nature must exactly proportion their wants and their powers. It is possible to conceive that their powers have the superiority, in which case these animals would be progressive and capable of improvement. An equilibrium of wants and powers would render them stationary beings; but the superiority of their wants to their powers it is impossible to conceive. From their birth, from their first appearance in life, their faculties must be complete—relatively to the wants for which they have to provide, or at least both must be developed in just proportion. Otherwise the species would die the moment they came into existence, and, consequently, could not be the subject of our observation.

Of all the species of living beings which surround us, undoubtedly none have so many wants as man. In none is infancy so long, so feeble, and so helpless—in none is maturity loaded with so much responsibility—in none is old age so frail and so liable to suffering. And, as if we had not enough of wants, man has tastes also, the satisfaction of which exercises his faculties quite as much as his wants. Scarcely has he appeased his hunger than he begins to pamper himself with dainties—no sooner has he clothed himself than he sighs for finery—no sooner has he obtained shelter than he proceeds to embellish and decorate his residence. His mind is as restless as his body is exacting. He seeks to fathom the secrets of nature, to tame animals, to control the elements, to dive into the bowels of the earth, to traverse broad seas, to soar above the clouds, to annihilate time and space. He desires to know the motions, the springs, the laws, of his mind and heart—to [p100] control his passions—to conquer immortality—to become a god—to bring all things into subjection; nature, his fellow-men, himself. In a word, his desires and aspirations expand continually, and tend towards the infinite.

Thus, in no other species are the faculties so susceptible of vast development as in man. It is his alone to compare and to judge, to reason and to speak, to foresee, to sacrifice the present to the future. He alone can transmit, from generation to generation, his works, his thoughts, the treasures of his experience. He alone is capable of a perfectibility which is indefinite, which forms a chain the countless links of which would seem to stretch beyond the limits of the present world.

Let me here set down an observation which belongs properly to Political Economy. However extended may be the domain of our faculties, they do not reach the length of ‹creating› anything. Man cannot, in truth, augment or diminish the number of existing particles of matter. His action is limited to subjecting the substances which he finds around him to modifications and combinations which fit them for his use.[25]

To modify substances, so as to increase their utility in relation to us, is to ‹produce›, or rather it is one mode of producing. From this I conclude that value (as we shall afterwards more fully explain) does not reside in these substances themselves, but in the effort which intervenes in order to modify them, and which exchange brings into comparison with other analogous efforts. This is the reason why value is simply the appreciation of services exchanged, whether a material commodity does or does not intervene. As regards the notion of value, it is a matter of perfect indifference whether I render to another a direct service, as, for example, in performing for him a surgical operation, or an indirect service, in preparing for him a curative substance. In this last case the ‹utility› is in the substance, but the ‹value› is in the service, in the effort, intellectual and muscular, made by one man for the benefit of another. It is by a pure metonymy that we attribute value to the material substance itself, and here, as on many other occasions, metaphor leads science astray.

I return to the subject of man’s organization. If we adhere to the preceding notions, he differs from other animals only in the greater extent of his wants, and the superiority of his powers. All, in fact, are subject to the one and provided with the other. A bird undertakes long journeys in search of the temperature which suits it best—the beaver crosses the river on a bridge of [p101] his own construction—the hawk pursues his prey openly—the cat watches for it with patience—the spider prepares a snare—all labour in order to live and multiply.

But while Nature has established an exact proportion between the wants of animals and their faculties, if she has treated man with greater bounty and munificence, if, in order to force him to be ‹sociable›, she has decreed that in a state of isolation his wants should surpass his faculties, whilst, on the contrary, in the social state, his powers, superior to his wants, open to him an unlimited field for nobler enjoyments, we ought to acknowledge that, as in his relation with the Creator man is elevated above the beasts by the religious sentiment, in his relations with his fellow-creatures by his sense of justice, in his relations with himself by the moral principle—in like manner, in relation to the means of living and multiplying, he is distinguished by a remarkable phenomenon, namely, «Exchange».

Shall I essay to paint the state of poverty, of destitution, and of ignorance, in which, but for the power of exchanging, the human species would have been sunk, had it not, indeed, as is more likely, disappeared altogether.

One of the most popular philosophers, in a romance which has been the charm of the young from generation to generation, has shown us man surmounting by his energy, his activity, his intelligence, the difficulties of absolute solitude. For the purpose of setting clearly before us what are the resources of that noble creature, the author has exhibited him as accidentally cut off from civilisation. It was part of Defoe’s plan to throw Robinson Crusoe into the Island of Juan Fernandez alone, naked, deprived of all that the union of efforts, the division of employments, exchange, society, add to the human powers.

And yet, although the fancied obstacles are but imaginary, Defoe would have taken away from his tale even the shadow of probability if, too faithful to the thought which he wished to develop, he had not made forced concessions to the social state, by admitting that his hero had saved from shipwreck some indispensable things, such as provisions, gunpowder, a gun, a hatchet, a knife, cords, planks, iron, etc.; a decisive proof that society is the necessary medium in which man lives, and out of which not even a romance writer could figure him as existing.

And, observe, that Robinson Crusoe carried with him into solitude another ‹social› treasure, a thousand times more precious than all these, and which the waves could not engulf, I mean his ideas, his recollections, his experience, above all, his language, [p102] without which he would not have been able to hold converse with himself, that is to say, to think.

We have the unfortunate and unreasonable habit of attributing to the ‹social state› the sufferings which we see around us. We are right so far, if our object be to compare society with itself in different degrees of advancement and improvement; but we are wrong if our object be to compare the social state, however imperfect, with a state of isolation. To authorize us to assert that society impairs the condition, I do not say of man in general, but of some men, and these the poorest and most wretched of the species, we must begin by proving that the worst provided of our fellow-creatures have to support in the social state a heavier load of privations and sufferings than the man whose lot has been cast in solitude. Now, examine the life of the humblest day-labourer. Pass in review, in all their details, the articles of his daily consumption. He is covered with some coarse clothing, he eats a little common bread, he sleeps under shelter, and on boards, at least, if he has no better couch. Now, let us ask if man in a state of isolation, deprived of the resources of Exchange, could by any possibility procure for himself that coarse clothing, that common bread, that rude bed, that humble shelter? Rousseau himself, the passionate enthusiast of the ‹state of nature›, avows the utter impossibility of it. Men dispensed with everything, he says; they went naked, they slept in the open air. Thus Rousseau, to exalt the state of nature, was led to make happiness consist in privation. And yet I affirm that this negative happiness is a chimera, and that man in a state of isolation would infallibly perish in a very few hours. Perhaps Rousseau would have gone to the length of saying that that would have been the perfection of his system; and he would have been consistent, for if privation be happiness, death is perfection.

I trust the reader will not conclude from what precedes that we are insensible to the social sufferings of our fellow-men. Because these sufferings are less even in an imperfect state of society than in a state of isolation, it does not follow that we should not invoke, with all earnestness, that progress which constantly diminishes them. But if isolation is something worse than all that is bad in the social state, then I am justified in saying that it places our wants, even the most imperious, far above our faculties and our means of providing for wants.

In what way does Exchange advantageously reverse all this, and place our faculties above our wants?

And first this is proved by the very fact of civilisation. If our [p103] wants surpassed our faculties, we should be beings invincibly retrograde; if there were an equilibrium between them, we should be invincibly stationary. But we advance; which shows that at every stage of social life, as compared with the period that preceded it, a certain portion of our powers, relatively to a given amount of satisfactions, is left disposable. We shall endeavour to explain this marvellous phenomenon.

The explanation which Condillac has given appears to me to be quite unsatisfactory and empirical—in fact, it explains nothing. “From the very fact,” he says, “that an exchange is made, it follows that there must be profit for the two contracting parties, for otherwise it would not take place. Then each exchange includes two gains for humanity.”

Holding this proposition as true, we see in it only the statement of a result. It is in this way that the ‹Malade Imaginaire› explains the narcotic virtue of opium:—

Quia est in eo Virtus dormitiva Quæ facit dormire.

Exchange includes two gains, you say. How? Why? It results from the fact that it takes place. But why does it take place? What motive has induced the contracting parties to effect the exchange? Has Exchange in itself a mysterious virtue, necessarily beneficial, and incapable of explanation?

Others make the advantage consist in this, that the one gives away a commodity of which he has too much in order to receive another of which he has too little. Exchange, they say, is a ‹barter of the superfluous for the necessary›. This is contradicted by facts which pass under our own eyes; for who can say that the peasant, in giving away the corn which he has raised, but which he is never to eat, gives away a superfluity? I see in this axiom very clearly how two men may make an accidental arrangement, but I see no explanation of progress.

Observation gives us a more satisfactory explanation of the power of Exchange.

Exchange has two manifestations—namely, union of forces, and separation of occupations.

It is very clear that in many cases the united force of several men is superior, all things considered, to the sum of their individual forces. Suppose that what is wanted is to remove a heavy load. Where a thousand men in succession may fail, it is possible that four men may succeed by uniting their efforts. Just let us reflect how few things were ever accomplished in this world without union! [p104]

And yet this is only the concurrence of muscular forces in a common design. Nature has endued us with very varied physical, intellectual, and moral faculties. There are in the co-operation of these faculties endless combinations. Is it wished to accomplish a useful work, like the construction of a road, or the defence of a country? One gives the community the benefit of his strength, another of his agility, another of his courage, another of his experience, foresight, imagination, even of his reputation. It is easy to comprehend that the same men acting singly could not have attained, or even conceived, the same results.

Now, union of forces implies Exchange. To induce men to co-operate, they have the prospect of participating in the benefit to be obtained. Each makes the other profit by his Efforts, and he profits by the other’s Efforts in return, which is Exchange.

We see how Exchange in this way augments our Satisfactions. The benefit consists in this, that efforts of equal intensity tend, by the mere fact of their union, to superior results. There is here no trace of the pretended ‹barter of the superfluous for the necessary›, any more than of the double and empirical profit alleged by Condillac.

The same remark applies to division of labour. Indeed, if we regard the matter more closely, we shall be convinced that the separation of employments is only another and more permanent manner of uniting our forces—of co-operating, of ‹associating›; and it is quite correct to say, as we shall afterwards demonstrate, that the present social organization, provided Exchange is left free and unfettered, is itself a vast and beautiful association—a marvellous association, very different, indeed, from that dreamt of by the Socialists, since, by an admirable mechanism, it is in perfect accordance with individual independence. Every one can enter and leave it at any moment which suits his convenience. He contributes to it voluntarily, and reaps a satisfaction superior to his contribution, and always increasing—a satisfaction determined by the laws of justice and the nature of things, not by the arbitrary will of a chief. But this is anticipating. All we have to do at present is to explain how the division of labour increases our power.

Without dwelling much on this subject, as it is one of the few which do not give rise to controversy, a remark or two may not be out of place. Its importance has perhaps been somewhat disparaged. In order to demonstrate the powerful effects of the Division of Labour, it has been usual to describe its marvellous results in certain manufactures—in the making of pins, for [p105] example. But the subject admits of being viewed in a more general and philosophical light. The force of habit has the singular effect of concealing from us, and rendering us unconscious of, the phenomena in the midst of which we live and move. No saying is more profoundly true than that of Rousseau, “Much philosophy is needed for the observation of what we see every day.” It may not then be without use to recall what we owe to Exchange, without perceiving it.

In what way has the power of exchanging elevated mankind to the height of civilisation we have now attained? I answer, by the influence which it exerts on ‹Labour›, upon the co-operation of ‹natural agents›, upon the ‹powers and faculties› of man, and upon ‹Capital›.

Adam Smith has clearly demonstrated its influence on Labour.

“The great increase in the quantity of work, which, in consequence of the division of labour, the same number of people are capable of performing, is owing to three circumstances,” says that celebrated Economist: “‹First›, to the increase of dexterity in every particular workman; ‹secondly›, to the saving of time which is commonly lost in passing from one species of work to another; ‹thirdly›, to this, that men are much more likely to discover easier and readier methods of attaining an object when the whole attention of their minds is directed to that single object, than when it is dissipated among a great variety of things.”

Those who, like Adam Smith, see in Labour the exclusive source of wealth, confine themselves to inquiring in what way the division of labour increases its efficiency. But we have seen in the preceding chapter that labour is not the sole agent in procuring us satisfaction. ‹Natural forces› co-operate. That is beyond doubt.

Thus, in agriculture, the action of the sun and of the rain, the moisture of the earth, and the gases diffused in the atmosphere, are undoubtedly agents which co-operate with human labour in the production of vegetable substances.

Manufacturing industry owes analogous services to the chemical qualities of certain substances, to water-power, to the elasticity of steam, to gravitation, to electricity.

Commerce has turned to the profit of man the vigour and instincts of certain races of animals, the force of the winds which fill the sails of his ships, the laws of magnetism, which, acting on the compass, direct the course of these ships through the pathless ocean.

There are two verities which are beyond all dispute. The [p106] first is, that ‹the more man avails himself of the forces of nature, the better he is provided with everything he requires›.

It is sufficiently evident that, with equal exertion, we obtain more corn from a rich loamy soil than from sterile rocks or arid sands.

The second is, ‹that natural agents are unequally diffused over the various countries of the world›.

Who would venture to maintain that all soils are equally well fitted for all kinds of culture, or all countries for the same description of manufactures?

Now, if it be true on the one hand that natural forces are unequally diffused in the different countries of the world, and on the other that men are richer in proportion as they avail themselves of them, it follows that the faculty of Exchange immeasurably augments the useful co-operation of these forces.

And here we recur once more to gratuitous and onerous utility, the former being substituted for the latter by virtue of Exchange. Is it not very clear, that if men were deprived of the power of Exchange, and were obliged to produce ice under the equator, and sugar at the poles, they must spend much pains in doing what heat and cold do gratuitously, and that for them an immense proportion of the Forces of nature would remain inoperative? Thanks to Exchange, these forces are rendered useful to us wherever we encounter them. Corn land is sown with wheat—in wine-growing countries the land is planted with vines—there are fishermen on the coasts, and wood-cutters among the mountains. In one place a wheel which does the work of ten men is set in motion by water—in another, by wind. Nature becomes a slave, whom we have neither to feed, nor to clothe, nor to pay—who costs nothing either to our purse or our conscience.[26] The same amount of human efforts, that is to say, the same services, the same value, realizes a constantly increasing amount of utility. For each given result a certain portion only of human exertion is absorbed; the remainder, by means of the intervention of natural Forces, is rendered disposable, and it sets to work to overcome new obstacles, to minister to new desires, to realize new utilities.

The effects of Exchange upon our intellectual Faculties are so great, that we can scarcely even imagine their extent.

“Knowledge,” says M. de Tracy, “is the most precious of all our acquisition, since it directs and governs the employment of our forces, and renders them more prolific, in proportion as it is sounder and more extensive. No man can himself observe [p107] everything, and it is much easier to learn than to invent. But when several men communicate with each other, what is observed by one is soon known to the rest; and if there be among them but one person of superior ingenuity, precious discoveries speedily become the property of all. In such circumstances, knowledge is much more rapidly increased than it could be in a state of isolation, without taking into account the power of preserving it, and consequently of accumulating it from one generation to another.”

If the resources which nature has accumulated around man and placed at his disposal are varied, the human faculties themselves are not less so. We are not all equally endowed with strength, courage, intelligence, patience, or with artistic, literary, and industrial aptitudes. Without exchange, this diversity, far from contributing to our well-being, would contribute to our misery, each feeling less the advantage of those Faculties he possessed than the deprivation of those he wanted. Thanks to exchange, a man possessed of bodily strength may, up to a certain point, dispense with genius, and a man of intelligence with bodily strength; for by the admirable community which the power of exchange establishes among men, each individual participates in the distinctive qualities of his neighbours.

In order to obtain the satisfactions he desires, it is not enough, in most cases, to work—to exercise his faculties upon, or by means of, natural agents. He requires also to have tools, instruments, machines, provisions—in a word, Capital. Suppose a small tribe, composed of ten families, each, in working exclusively for itself, being obliged to engage in ten different employments. In that case each family must have ten sets of industrial apparatus. The tribe would require to possess ten ploughs, ten teams of oxen, ten forges, ten joiner’s and carpenter’s workshops, ten looms, etc.; while, with the power of exchange, a single plough, a single team, a single forge, a single loom, would be sufficient. It is impossible to conceive the economy of Capital which we owe to exchange.

The reader now sees clearly what constitutes the true power of exchange. It is not, as Condillac says, that it implies ‹two gains›, because of each of the contracting parties valuing more highly what he receives than what he gives. Neither is it that each gives away what is superfluous for what is necessary. It lies simply in this, that when one man says to another, “Do you only this, and I shall do only that, and we shall divide,” there is a better and more advantageous employment of labour, of faculties, of natural agents, of capital, and consequently there is ‹more› to divide. And these results take place to a still greater extent when [p108] three, ten, a hundred, a thousand, or several millions of men enter into the association.

The two propositions which I have laid down, then, are rigorously true, viz.:—

‹In isolation our wants exceed our powers;›

‹In society our powers exceed our wants.›

The first is true, seeing that the whole surface of our country would not maintain one man in a state of absolute isolation.

The second is true, seeing that, in fact, the population which is spread over that same surface multiplies and grows richer.

‹Progress of Exchange.›—The primitive form of exchange is ‹Barter›. Two persons, one of whom desires an object, and is possessed of an object which the other desires, agree to cede these objects reciprocally, or they agree to work separately, each at one thing, but for the purpose of dividing the total product of their labour in arranged proportions. This is ‹Barter›, which is, as the Socialists would say, Exchange, traffic, commerce ‹in embryo›. We observe here two Desires as motives—two Efforts as means—two Satisfactions as results, or as the termination and completion of the entire cycle; and this evolution is not essentially different from the same evolution accomplished in a state of isolation, except that the desires and satisfactions have, as their nature requires, remained intransmissible, and that Efforts alone have been exchanged. In other words, the two persons have worked for each other, and have rendered each other reciprocal ‹services›.

It is at this point that Political Economy truly begins, for it is here that ‹value› first makes its appearance. Barter takes place only after an arrangement, a discussion. Each of the contracting parties is governed by considerations of self-interest. Each of them makes a calculation, which in effect comes to this, “I shall barter if the barter procures me the ‹satisfaction› I ‹desire› with a less ‹Effort›.” It is certainly a marvellous phenomenon that diminished efforts can yet keep pace with undiminished desires and satisfactions; and this is explained by the considerations which I have presented in the first part of this chapter. When two commodities or two services are ‹bartered›, we may conclude that they are of ‹equal value›. We shall have to analyze afterwards the notion of ‹value›, but this vague definition is sufficient for the present.

We may suppose a ‹round-about barter›, including three contracting parties. ‹Paul› renders a service to ‹Peter›, who renders an equivalent service to ‹James›, who in turn renders an equivalent service to ‹Paul›, by means of which all is balanced. I need not say that this round-about transaction only takes place because it [p109] suits all the parties, without changing either the nature or the consequences of barter.

The essence of Barter is discovered in all its purity even when the number of contracting parties is greater. In my ‹commune› the vine-dresser pays with wine for the services of the blacksmith, the barber, the tailor, the beadle, the curate, the grocer; while the blacksmith, the barber, the tailor, in turn deliver to the grocer, for the commodities consumed during the year, the wine which they have received from the vine-dresser.

This round-about Barter, I cannot too often repeat, does not change in the least degree the primary notions explained in the preceding chapters. When the evolution is complete, each of those who have had part in it presents still the triple phenomenon, ‹want›, ‹effort›, ‹satisfaction›. We have but to add, the exchange of efforts, the transmission of services, the separation of employments, with all their resulting advantages—advantages to which every one of the parties has contributed, seeing that isolated individual labour is a ‹pis aller›, always reserved, and which is only renounced in consideration of a certain advantage.

It is easy to comprehend that Barter in kind, especially the indirect and round-about barter which I have described, cannot be much extended, and it is unnecessary to dwell upon the obstacles which set limits to it. How could he manage, for example, who wished to exchange his house against the thousand articles which enter into his annual consumption? In any case, Barter could never take place but among the few persons who happen to be acquainted with each other. Progress and the Division of Labour would soon reach their limits if mankind had not discovered the means of facilitating exchanges.

This is the reason why men, from the earliest ages of society, have employed an intermediate commodity to effect their transactions—corn, wine, animals, and almost always, the precious metals. Such commodities perform this function of facilitating exchanges more or less conveniently; still any one of them can perform it, provided that, in the transaction, Effort is represented by ‹value›, the transmission of which is the thing to be effected.

When recourse is had to an intermediate commodity, two economic phenomena make their appearance, which we denominate ‹Sale› and ‹Purchase›. It is evident that the idea of ‹sale› and ‹purchase› is not included in direct Barter, or even in round-about Barter. When a man gives another something to drink, in consideration of receiving from him something to eat, we have a [p110] simple fact which we cannot analyze farther. Now, what we must remark in the very outset of the science is, that exchanges which are effected by means of an intermediate commodity do not lose the nature, the essence, the quality of barter—only the barter is no longer simple, but compound. To borrow the very judicious and profound observation of J. B. Say, it is a barter of ‹two factors› [troc à deux facteurs], of which the one is called ‹sale› and the other ‹purchase›—factors whose union is indispensable in order to constitute a complete barter.

In truth, this discovery of a convenient means of effecting exchanges makes no alteration in the nature either of men or of things. We have still in every case the ‹want› which determines the ‹effort›, and the ‹satisfaction› which rewards it. The Exchange is complete only when the man who has made an ‹effort› in favour of another has obtained from him an equivalent service, that is to say, ‹satisfaction›. To effect this, he ‹sells› his service for the intermediate commodity, and then with that intermediate commodity he ‹purchases› equivalent services, when the two factors bring back the transaction to simple ‹barter›.

Take the case of a physician, for instance. For many years he has devoted his time and his faculties to the study of diseases and their remedies. He has visited patients, he has prescribed for them, in a word, he has rendered ‹services›. Instead of receiving compensation from his patients in ‹direct services›, which would have constituted simple barter, he receives from them an intermediate commodity, the precious metals, wherewith he purchases the satisfactions which were the ultimate object he had in view. His patients have not furnished him with bread, wine, or other goods, but they have furnished him with the value of these. They could not have given him money unless they had themselves rendered ‹services›. As far as they are concerned, therefore, there is a balance of ‹services›, and there is also a balance as regards the physician; and could we in thought follow this circulation of services out and out, we should see that Exchange carried on by the intervention of money resolves itself into a multitude of acts of simple barter.

In the case of simple barter, ‹value› is the appreciation of two services exchanged and directly compared with each other. In the case of ‹Compound Exchange› the two services measure each other’s value, not directly, but by comparison with this mean term, this intermediate commodity, which is called Money. We shall see by-and-by what difficulties, what errors, have sprung from this complication. At present it is sufficient to remark that [p111] the intervention of this intermediate commodity makes no change whatever in the notion of ‹value›.

Only admit that exchange is at once the cause and the effect of the division of labour and the separation of employments; only admit that the separation of occupations multiplies ‹satisfactions› in proportion to ‹efforts›, for the reasons explained at the beginning of this chapter, and you will comprehend at once the services which Money has rendered to mankind, by the simple fact that it facilitates Exchanges. By means of Money, Exchange is indefinitely extended and developed. Each man casts his services into the common fund, without knowing who is to enjoy the satisfactions which they are calculated to procure. In the same way he obtains from society, not immediate services, but money with which he can afterwards purchase services, where, when, and how it may best suit him. In this way the ultimate transactions occur at various times and places, between people totally unacquainted with each other, and in the greater number of cases no one knows by whose ‹efforts› his ‹wants› will be ‹satisfied›, or to the ‹satisfaction› of whose ‹desires› his own ‹efforts› will contribute. Exchange, by the intervention of Money, resolves itself into innumerable acts of ‹barter›, of which the contracting parties themselves are ignorant.

Exchange, however, confers so great a benefit on society (is it not society itself?) that it facilitates and extends it by other means besides the introduction of money. In logical order, after Want and Satisfaction united in the same individual with isolated Effort—after simple barter—after barter ‹à deux facteurs›, or Exchange composed of ‹sale› and ‹purchase›—come other transactions, extended farther over time and space by means of credit, mortgages, bills of exchange, bank notes, etc. By means of this wondrous machinery, the result of civilisation, the improver of civilisation, and itself becoming more perfect at the same time, an exertion made at the present hour in Paris may contribute to the satisfaction and enjoyment of an unknown stranger, separated from us by oceans and centuries; and he who makes the exertion will not the less receive for it a present recompense, through the intervention of persons who advance the remuneration, and wait to be reimbursed in a distant country or at a future day. Marvellous and astonishing complication! which, when subjected to analysis, shows us finally the accomplishment of the entire economic cycle—‹want›, ‹effort›, ‹satisfaction›, taking place in each individual, according to a just law.

‹Limits of Exchange.›—The general character of Exchange is ‹to diminish the proportion which the Effort bears to the satisfaction›. Between our wants and our satisfactions ‹obstacles› are interposed, [p112] which we succeed in diminishing by the union of forces or the division of occupations, that is to say, by ‹Exchange›. But Exchange itself encounters obstacles and demands efforts. The proof of this is the immense amount of human labour which it sets in motion. The precious metals, roads, canals, railways, wheeled carriages, ships—all these things absorb a considerable portion of human activity. Observe, besides, how many men are exclusively occupied in facilitating exchanges—how many bankers, merchants, shopkeepers, brokers, carriers, sailors! This vast and costly apparatus shows us, better than any reasoning, how much efficacy there is in the power of Exchange, for why otherwise should society be encumbered with it?

Since it is the nature of Exchange to ‹save› efforts and to ‹exact› them, it is easy to understand what are its natural limits. In virtue of that motive which urges man to choose always the least of two evils, Exchange will go on extending itself indefinitely as long as the effort it exacts is less than the effort which it saves. And its extension will stop naturally when, upon the whole, the aggregate of satisfactions obtained by the division of labour becomes less, by reason of the increasing difficulties attending Exchange, than if we procured them by direct production.

Suppose the case of a small tribe. If they desire to procure themselves satisfactions they must make an effort. They may address themselves to another tribe, and say to them, “Make this effort for us, and we shall make another for you.” The stipulation may suit all parties, if, for example, the second tribe is in a situation to obtain greater assistance than the other from natural and gratuitous forces. In that case it may be able to realize the result with an effort equal to eight, while the first could only accomplish it by an effort equal to twelve. There is thus an economy equal to four for the first. But then come the cost of transport, the remuneration of intermediate agents, in a word, the effort exacted by the machinery of Exchange. This cost must, then, clearly be added to the figure eight. Exchange will continue to take place as long as the Exchange ‹itself› does not cost four. The moment it reaches that figure it will stop. It is quite unnecessary to make laws on this subject; for either the law intervenes before this level is attained, and then it is injurious—it prevents an economy of efforts—or it comes after it, and then it is useless, like an ordinance forbidding people to light their lamps at noonday.

When Exchange is thus arrested from ceasing to be advantageous, the slightest improvement in the ‹commercial apparatus› gives it a new activity. Between Orleans and Angoulême a certain [p113] number of transactions take place. These towns effect an Exchange as often as they can obtain a greater amount of enjoyments by that means than by direct production. They stop short the moment the cost of obtaining commodities by means of exchange, aggravated by the cost of effecting the exchange itself, surpasses, or reaches, that of obtaining them by means of direct production. In these circumstances, if we improve the conditions under which Exchanges are effected—if the merchants’ profits are diminished, or the means of transport facilitated—if roads and railways are made, mountains levelled, and bridges thrown over rivers—in a word, if obstacles are removed, the number of Exchanges will be increased; for men are always desirous to avail themselves of the great advantages which we have ascribed to Exchange, and to substitute gratuitous for onerous utility. The improvement of the ‹commercial apparatus›, then, is equivalent to bringing two cities locally nearer to each other. Whence it follows that bringing men physically, locally, nearer each other is equivalent to improving the conditions of exchange. This is very important. It is, in fact, the solution of the problem of population; and this is precisely the element in that great problem that Malthus has neglected. Where Malthus saw Discordance, attention to this element enables us to discover ‹Harmony›.

When men effect an exchange, it is because they succeed by that means in obtaining an equal amount of ‹satisfaction› at a less expense of ‹effort›; and the reason of this is, that on both sides services are rendered which are the means of procuring a greater proportion of what we have termed ‹gratuitous utility›.

Now, you have always a greater number of exchanges in proportion as you remove the ‹obstacles› which impede exchanges, and diminish the ‹efforts› which these exchanges exact.

And Exchange encounters fewer obstacles, and exacts fewer efforts, just in proportion as you bring men nearer each other, and mass them more together. A greater density of population, then, is accompanied by a greater proportion of ‹gratuitous utility›. That density imparts greater power to the machinery of exchange; it sets free and renders disposable a portion of human efforts; it is a cause of progress.

Now, if you please, let us leave generalities and look at facts.

Does not a street of equal length render more service in Paris than in a remote village? Is not a mile of railway of more use in the Department of the Seine than in the Department of the Landes? Is not a London merchant content with smaller profits [p114] on account of the greater amount of business which he transacts? In everything we shall discover two sets of exchange agencies at work, which although identical in kind, act very differently, according as they operate in a densely or a thinly peopled locality.

The density of population not only enables us to reap more advantage from the machinery of exchange, it permits us to improve that machinery, and increase its power. Where the population is condensed, these improvements are advantageous, because they save us more efforts than they exact; but where the population is scattered and thin-spread, they exact more efforts than they save.

On leaving the metropolis for a time, and going to reside in a small provincial town, one is astonished to find that in many instances the most ordinary ‹services› can only be obtained at great expense, and with time and difficulty.

It is not the material part of the commercial mechanism only which is turned to account and improved by the single circumstance of the density of population, but the moral part also. When men are massed together, they have more facility in dividing their employments, in uniting their powers, and in combining to found churches and schools, to provide for their common security, to establish banks and insurance companies, in a word, to procure themselves all the common enjoyments with a much smaller proportion of efforts.

We shall revert to these considerations when we come to enter on the subject of Population. At present we shall make only this remark:—

Exchange enables men to turn their faculties to better account, to economize capital, to obtain more assistance from the gratuitous agencies of nature, to increase the proportion of gratuitous to onerous utility, to diminish, consequently, the ratio of efforts to results, and to leave at their disposal a part of their forces, so that they may withdraw a greater and greater portion of them from the business of providing for their primary and more imperious wants, and devote them to procuring enjoyments of a higher and higher order.

If Exchange saves efforts, it also exacts them. It extends, and spreads, and increases, up to the point at which the effort it exacts becomes equal to the effort which it saves, and it stops there until, by the improvement of the commercial apparatus, or by the circumstance exclusively of the condensation of population, and bringing men together in masses, it again returns to the conditions which are essential to its onward and ascending march. [p115] Whence it follows that laws which limit or hamper Exchanges are always either hurtful or superfluous.

Governments which persuade themselves that nothing good can be done but through their instrumentality, refuse to acknowledge this harmonic law.

‹Exchange develops itself› «NATURALLY» ‹until it becomes more onerous than useful, and at that point it› «NATURALLY» ‹stops›.

In consequence, we find governments everywhere busying themselves in favouring or restraining trade.

In order to carry it ‹beyond› its natural limits, they set to conquering colonies and opening new markets. In order to confine it ‹within› its natural bounds, they invent all sorts of restrictions and fetters.

This intervention of Force in human transactions is the source of innumerable evils.

The Increase of this force itself is an evil to begin with; for it is very evident that the State cannot make conquests, retain distant countries under its rule, or divert the natural course of trade by the action of tariffs, without greatly increasing the number of its agents.

The Diversion of the public Force from its legitimate functions is an evil still greater than its Increase. Its rational mission was to protect Liberty and Property; and here you have it violating Liberty and Property. All just notions and principles are thus effaced from men’s minds. The moment you admit that Oppression and Spoliation are legitimate, provided they are legal—provided they interfere only by means of the Law or public Force, you find by degrees each class of citizens demanding that the interest of every other class should be sacrificed to it.

This intervention of Force in the business of Exchanges, whether it succeeds in promoting or in restraining them, cannot fail to occasion both the Loss and Displacement of labour and capital, and, of consequence, a disturbance of the natural distribution of the population. On one side, natural interests disappear, on the other, artificial interests are created, and men are forced to follow the course of these interests. It is thus we see important branches of industry established where they ought not to be. France makes sugar; England spins cotton, brought from the plains of India. Centuries of war, torrents of blood, the dissipation of vast treasures, have brought about these results, and the effect has been to substitute in Europe sickly and precarious for sound and healthy enterprises, and to open the door to commercial crises, to stoppages, to instability, and finally to Pauperism.

But I find I am anticipating. What we ought first to do is to [p116] acquaint ourselves with the free and natural development of human societies, and then investigate the Disturbances.

‹Moral Force of Exchange.›—We must repeat, at the risk of wounding modern sentimentalism, that Political Economy belongs to the region of ‹business›, and business is transacted under the influence of ‹personal interest›. In vain the puritans of socialism cry out, “This is frightful; we shall change all this.” Such declamations involve a flat contradiction. Do we make purchases on the Quai Voltaire in the name of Fraternity?

It would be to fall into another kind of declamation to attribute morality to acts determined and governed by ‹self-interest›. But a good and wise Providence may so have arranged the social order that these very acts, destitute of morality in their motives, may nevertheless tend to moral results. Is it not so in the case of labour? Now, I maintain that Exchange, whether in the incipient state of simple barter, or expanded into a vast and complicated commerce, develops in society tendencies more noble than the motive which gives rise to it.

I have certainly no wish to attribute to only one of our powers all that constitutes the grandeur, the glory, and the charm of our existence. As there are two forces in the material world—one which goes from the circumference to the centre, the other from the centre to the circumference—there are also two principles in the social world, self-interest and sympathy. It were a misfortune indeed did we fail to recognise the benefits and joys of the sympathetic principle, as manifested in friendship, love, filial piety, parental tenderness, charity, patriotism, religion, enthusiasm for the good and the beautiful. Some have maintained that the sympathetic principle is only a magnificent form of self-love, that to love others is at bottom only an intelligent way of loving ourselves. This is not the place to enter on the solution of that problem. Whether these two native energies are distinct or confounded, it is enough for us to know that, far from being antagonistic, as is constantly said, they act in combination, and concur in the realization of one and the same result, the general good.

I have established these two propositions:—

‹In a state of isolation, our wants exceed our powers;›

‹In consequence of Exchange, our powers exceed our wants.›

These propositions show the end and purpose of society. There are two others which guarantee its indefinite improvement:—

‹In a state of isolation the gain of one may be the loss of another;›

‹In consequence of Exchange, the gain of each is the gain of all.›

Is it necessary to prove that, if nature had destined man to a [p117] solitary life, the prosperity of one would have been incompatible with that of another, and the more numerous men had been, the less chance would they have had of attaining prosperity? At all events, we see clearly in what way numbers might have been injurious, and we do not see how they could have been beneficial. And then, I would ask, under what form could the principle of sympathy have manifested itself? How, or on what occasion, could it have been called forth? Could we have even comprehended it?

But men exchange, and Exchange, as we have seen, implies the separation of employments. It gives birth to professions and trades. Each man sets himself to overcome a certain class of obstacles, for the benefit of the Community. Each makes it his business to render a certain description of ‹services›. Now, a complete analysis of value demonstrates that each service ‹has value› in the first instance in proportion to its intrinsic utility, and afterwards in proportion to the wealth of those to whom it is furnished—that is to say, in proportion as the community to whom the service is rendered has a greater demand for it, and is in a better situation to pay for it. Experience shows us that the artizan, the physician, the lawyer, the merchant, the carrier, the professor, the ‹savant›, derive greater returns from their services in Paris, in London, or at New York, than in the Landes of Gascony, or the mountains of Wales, or the prairies of the Far West. And does not this confirm the truth, ‹that each man is more likely to prosper in proportion to the general prosperity of the community in which he lives›?

Of all the harmonies which have come under my observation, this is beyond doubt the most important, the finest, the most decisive, the most suggestive. It sums up and includes all the others. This is why I can give only a very incomplete demonstration of it in this place. The whole scope and spirit of this work will establish it; and I shall deem it a fortunate thing if its probability at least is made so apparent as to induce the reader to convince himself of its truth by farther inquiry and reflection.

For it is beyond question that on this turns our decision between natural and artificial Organizations—that on this, and this alone, hangs the solution of the Social Problem. If the prosperity of all be the condition of the prosperity of each, then we can repose with confidence not only on the economic power of free trade, but on its moral force. If men only understood their true interests, restrictions, mercantile jealousies, commercial wars, monopolies, would go down under the influence of public opinion; [p118] and before soliciting the interposition of government in any case, the question would be, not “How am ‹I› to be benefited by it?” but “What advantage is likely to result from it to the community?” This last question, I grant, is sometimes elicited by the principle of sympathy; but let men be once enlightened, and it will be called forth by Self-interest. Then we shall be enabled to say with truth that the two motive principles of our nature tend towards the same result—the General Good; and it will be impossible to deny Moral Power to self-interest, and the transactions which spring from it, as far at least as their effects are concerned.

Consider the relations of man to man, family to family, province to province, nation to nation, hemisphere to hemisphere, capitalist to labourer, the man of property to the man of no property,—it seems evident to me that it is impossible to resolve the social problem from any one of these points of view, or even to enter upon its solution, before choosing between these two maxims:—

‹The profit of one is the loss of another;›

‹The profit of one is the gain of another.›

For if nature has arranged matters so that antagonism is the law of free transactions, our only resource is to vanquish nature and stifle Freedom. If, on the other hand, these free transactions are harmonious, that is to say, if they tend to ameliorate and equalize the conditions of men, our efforts must be confined to allowing nature to act, and maintaining the rights of human Liberty.

This is the reason why I conjure the young people to whom this work is dedicated to scrutinize with care the formulas which it lays down, and to analyze the peculiar nature and effects of Exchange. I hope yet to find at least one among them who will be able to demonstrate rigorously this proposition: “‹The good of each tends to the good of all, as the good of all tends to the good of each›;” and who will, moreover, be able to impress this truth upon men’s minds by rendering the proof of it simple, lucid, and irrefragable. The man who does this will have resolved the social problem, and be the benefactor of the human race.

Depend upon it, that according as this axiom is true or false, the natural laws of society are harmonious or antagonistic; and that according as they are harmonious or antagonistic, it is our interest to conform to them or to deviate from them. Were it once thoroughly demonstrated, then, that under the empire of freedom men’s interests harmonize and favour each other, all the efforts which we now see governments making to disturb the [p119] action of these natural social laws we should see directed to giving them force, or rather, no efforts whatever would then be necessary, and all they would have to do would be to abstain from interfering. In what does the restraining action of governments consist? We may infer it from the design they have in view. What is that design? To remedy the inequality which is supposed to spring from Liberty. Now, there is only one way of re-establishing the equilibrium, namely, ‹to take from one in order to give to another›. Such, in fact, is the mission which governments have arrogated to themselves, or have received; and it is a rigorous consequence of the formula, that ‹the gain of one is the loss of another›. If that axiom be true, Force must repair the evils of Liberty. Thus governments, instituted for the protection of liberty and property, have undertaken the task of violating liberty and property in every shape; and they have done so consistently, if it be in liberty and property that the germ and principle of evil reside. Hence we see them everywhere engaged in the artificial displacement and redistribution of labour, capital, and responsibility.

On the other hand, an incalculable amount of intellectual force is thrown away in the pursuit of artificial social organizations. ‹To take from one in order to give to another›, to violate both liberty and property, is a very simple design, but the means of carrying out that design may be varied to infinity. Hence arise multitudes of systems, which strike the producing classes with terror, since from the very nature of the object they have in view, they menace all existing interests.

Thus arbitrary and complex systems of government, the negation of liberty and property, the antagonism of classes and nations, all these are logically included in the axiom, that ‹the gain of one is the loss of another›. And, for the same reason, simplicity in government, respect for individual dignity, freedom of labour and exchange, peace among nations, security for person and property, are all contained and shut up in this truth—Interests are harmonious. They are so, however, only on one condition, which is, that this truth should be generally admitted.

But it is very far from being so. On reading what I have said on this subject many people will be led to say, You break through an open door. Who ever thought of contesting seriously the superiority of Exchange to Isolation? In what book, unless indeed in the works of Rousseau, have you encountered this strange paradox?

Those who stop me with this reflection forget only two things, two [p120] symptoms, or rather two aspects of modern society, the doctrines with which theorists inundate us, and the practice which governments impose on us. It is quite impossible that the harmony of interests can be universally recognised, since, on the one hand, public force is constantly engaged in interfering to disturb natural combinations, while, on the other, the great complaint which is made against the ruling power is, that it does not interfere enough.

The question is this, Are the evils (I do not speak here of evils which arise from our native infirmity)—are the evils to which society is subject imputable to the action of natural social laws, or to our disturbance of that action?

Now, here we have two co-existent facts, Evil,—and Public Force, engaged to counteract the natural social laws. Is the first of these facts the consequence of the second? For my own part, I believe so; I should even say, I am certain of it. But at the same time I can attest this, that in proportion as evil is developed, governments invariably seek for a remedy in new disturbances of the natural laws, and theorists reproach them with not going far enough. Am I not thence entitled to conclude that they have but little confidence in these laws?

Undoubtedly, if the question is between Isolation and Exchange we are at one. But if the question be between free and compulsory exchange, does the same thing hold? Is there nothing forced, factitious, restrained, constrained, in France, in the manner in which services which have relation to trade, to credit, to conveyances, to the arts, to education, to religion, are exchanged? Are labour and capital distributed naturally between agriculture and manufactures? When existing interests are disturbed, are they allowed of their own accord to return to their natural channels? Do we not encounter trammels and obstacles on all sides? Are there not a hundred professions which are interdicted to the majority of the people? Is the Roman-catholic not ‹forced› to pay for the services of the Jewish Rabbi, and the Jew for the services of the Catholic priest? Is there a single man in France who has received the education which his parents would have given him had they been free? Are not our minds, our manners, our ideas, our employments, fashioned under the ‹régime› of the arbitrary, or at least of the artificial? Now, I ask, whether thus to disturb the free exchange of services is not to abjure and deny the harmony of interests? On what ground am I robbed of my liberty, unless it be that it is judged hurtful to others? Is it pretended that it is injurious to myself? This would be but to add one antagonism the more. And only think! in what a situation [p121] should we find ourselves if nature had placed in each man’s heart a permanent irrepressible spring of action, urging him to injure those around him, and at the same time to injure himself?

Alas! we have tried everything—when shall we make trial of the simplest thing of all—Liberty. Liberty in all that does not offend against justice—liberty to live, advance, improve—the free exercise of our faculties—the free interchange of services. A beautiful and solemn spectacle it would have been, had the Power which sprang from the revolution of February thus addressed our citizens:—

“You have invested me with the public Force. I shall apply it exclusively to those things in which the intervention of Force is permissible, and there is but one—Justice. I shall force every one to confine himself within the bounds of right. You may work freely and as you please during the day, and sleep in peace at night. I have taken under my charge the security of person and property—that is my mission, and I will fulfil it—‹but I accept no other›. Let there then be no longer any misunderstanding between us. Henceforth you shall pay me only the light tribute which is necessary for the maintenance of order and the administration of justice. Keep in mind that henceforth every man must depend upon himself for his subsistence and advancement. Turn no longer your longing eyes to me. Ask me no longer for wealth, for employment, for credit, for education, for religion, for morality. Never forget that the mainspring of your development is in yourselves. As for me, I never act but through the intervention of force. I have nothing, absolutely nothing, but what I derive from you, and for this reason I cannot confer even the smallest advantage on one except at the expense of another. Cultivate your fields, then, manufacture and export your products, carry on trade, afford each other credit, render and receive services freely, educate your children, set them out in life, cultivate the arts, improve your minds, refine and purify your tastes and sentiments, unite, form industrial and charitable associations, join your efforts for your individual good and that of the public, follow your inclinations, fulfil your destinies by the free exercise of your powers, your ideas, and your foresight. Expect from me only two things—Liberty and Security—and depend upon it you cannot ask me for a third without losing the other two.”

I am thoroughly persuaded that if the revolution of February had proclaimed these principles we never should have had another revolution. Is it possible to conceive that citizens, left perfectly free in all other respects, would conspire to overturn a Power [p122] whose action was limited to the satisfaction of the most pressing, the most deeply felt of all our social requirements, the requirements of Justice?

But it was unfortunately impossible for the National Assembly to adopt this course, or make these sentiments heard. They were not in accordance either with the ideas of the Assembly or the expectations of the public. They would have terrified society as much as the proclamation of Communism. To be responsible to ourselves, forsooth! To trust to the State only for the maintenance of order and peace! To expect from it neither wealth nor knowledge! To be able no longer to make it responsible for our faults, our folly, our imprudence! To trust only to ourselves for the means of subsistence and physical amelioration, or moral and intellectual improvement! What on earth is to become of us? Is not society on the eve of being invaded by poverty, ignorance, error, irreligion, and perversity?

We allow that such undoubtedly would have been the fears which would have manifested themselves on all sides had the revolution of February proclaimed Liberty, that is to say, the reign of the natural laws of society. Then we were either unacquainted with these laws, or we wanted confidence in them. We could not get rid of the idea that the motives and springs of action which God has implanted in the mind of man are essentially perverse; that rectitude resides nowhere but in the views and intentions of the governing power; that the tendencies of human nature lead to disorganization, to anarchy,—in a word, we believed in the inevitable antagonism of interests.

So far was the revolution of February from displaying any tendency towards a natural organization, that never were the hopes and ideas of French society so decidedly turned to artificial combinations as at that epoch. Which of these combinations was in most favour? I really cannot very well tell. The business, in the language of the day, was to make experiments—‹Faciamus experimentum in corpore vili›. Such was their contempt for individuality, so thoroughly did they assimilate human nature to inert matter, that they talked of making social experiments with men, just as we make chemical experiments with acids and alkalies. The first tentative was begun at the Luxembourg, we know with what success. Erelong the Constituent Assembly instituted a Committee of Labour, in which a thousand social schemes were engulfed and swallowed up. A Fourierist representative seriously demanded lands and money (he would soon have asked for men also) to enable him to manipulate his model society. Another [p123] ‹Egalitaire› representative offered his recipe, which was rejected. The manufacturers were more lucky, and succeeded in maintaining theirs. In the meantime, the Legislative Assembly named a commission to organize “assistance.”

Now, what strikes us with surprise in all this is, that the Ruling Power, for the sake of its own stability, did not from time to time thus enter its protest:—“You are habituating thirty-six millions of men to regard the State as responsible for all the good or evil that may befall them in this world. At this rate, Government is impossible.”

At any rate, if these various social inventions, dignified with the high sounding title of organization, differ from each other in their manner of proceeding, they are all founded on the same principle: Take from one to give to another. Now such a principle clearly could not meet with such universal sympathy from the people, unless they were thoroughly convinced that men’s interests are naturally antagonistic, and that the tendencies of human nature are essentially perverse.

To take from one to give to another! I know well that things have gone on in this way for a long time. But before you set yourselves to imagine various means of realizing this whimsical principle for the remedy of existing distress, would it not be well to inquire whether that distress has not proceeded from the very fact that this principle in a certain form has been realized already? Before seeking a remedy in new disturbances of the natural social laws, should you not make sure that such perturbations do not themselves constitute the very evil from which society suffers, and which it is your object to cure?

To take from one in order to give to another! Just allow me to mark here the danger and the absurdity, in an economical point of view, of this so-called ‹social› aspiration, which, fermenting among the masses of our population, broke forth with so terrific a force in the revolution of February.[27]

Where society consists of several grades, we are apt to think that people of the highest rank enjoy Privileges or Monopolies at the expense of all the other members of the community. This is odious, but it is not absurd.

The second grade, the class immediately below the first, will not fail to attack and batter down monopolies; and, with the assistance of the masses, they will succeed sooner or later in bringing about a Revolution. In that case, power passes into their hands, and they still think that power implies Monopoly. [p124] This is still odious, but it is not absurd, at least it is not impracticable; for Monopolies are possible as long as there is, below the grade which enjoys them, a lower stratum—namely, the public at large, which supports and feeds them. If the third and fourth grade succeed, in their turn, in effecting a revolution, they will, if they can, so arrange as to make the most of the masses, by means of privileges or monopolies skilfully combined. But then the masses, emaciated, ground down, trampled upon, must also have their revolution. Why? What are they going to do? You think, perhaps, that they are going to abolish all monopolies and privileges, and to inaugurate the reign of universal justice; that they are about to exclaim—away with restrictions—away with shackles and trammels—away with monopolies—away with Government interferences for the profit of certain classes; begone taxes and grinding impositions; down with political and diplomatic intrigues? Not at all. They have quite another aim. They become their own solicitors, and in their turn demand to be ‹privileged›! The public at large, imitating their superiors, ask for monopolies! They urge their right to employment, their right to credit, their right to education, their right to assistance! But at whose expense? They are easy on that score. They feel only that, if they are ensured employment, credit, education for their children, repose for their old days, and all gratis, they will be exceedingly happy; and, truly, no one disputes it. But is it possible? Alas! no; and this is the reason why I say that here the odious disappears, and the absurd has reached its climax.

Monopolies to the masses! Good people, reflect a little on the vicious circle in which you are placing yourselves. Monopoly implies some one to enjoy it, and some one to pay for it. We can understand a privileged man, or a privileged class, but not a privileged people. Is there below you a still lower stratum of society upon which you can throw back the burden? Will you never comprehend the whimsical mystification of which you are the dupes? Will you never understand that the state can give you nothing with the one hand but what it has taken from you with the other? that, far from there being for you in this combination any possible increase of prosperity, the final result of the operation must be an arbitrary Government, more vexatious, more exacting, more uncertain, more expensive;—heavier taxes,—more injustice, more offensive favouritism,—liberty more restrained,—power thrown away,—occupations, labour, and capital displaced,—covetousness excited,—discontent provoked,—and individual energy extinguished? [p125]

The upper classes have got alarmed, and not without reason, at this unhappy disposition of the masses. They see in it the germ of incessant revolutions; for what Government can hold together which has ventured to say—“I am in possession of force, and I will employ it to support everybody at the expense of everybody? I undertake to become responsible for the general happiness.” But is not the alarm which has seized these classes a just and merited punishment? Have they not themselves set the people the fatal example of that grasping disposition of which they now complain? Have they not had their own eyes perpetually turned to the treasury? Have they ever failed to secure some monopoly, some privilege, great or small, to manufactures, to banks, to mines, to landed property, to the arts, even to the means of diversion, to the ballet, to the opera, to everything and everybody, in short; except to the industry of the people—to manual labour? Have they not multiplied beyond bounds public employments, in order to increase, at the expense of the people, their own resources? and is there at this day a single head of a family in France who is not on the outlook for a ‹place› for his son? Have they ever endeavoured to get rid of any one of the acknowledged inequalities of taxation? Have they not for a long time turned to account everything, even the electoral franchise? And yet they are astonished and horrified that the people should adopt the same course. When the spirit of mendicity has so long infected the wealthy orders, how can we suppose that it will not penetrate to the heart of the suffering masses?

However, a great revolution has taken place. Political power, the power of making the laws, the disposal of the public force, has passed virtually, if not yet in fact, into the hands of the people along with universal suffrage. Thus the people, who have proposed the problem for solution, will be called upon to solve it themselves: and woe to the country, if, following the example which has been set them, they seek its solution in Privilege, which is always an invasion of another’s rights. They will find themselves mistaken, and the mistake will bring with it a great lesson; for if it be possible to violate the rights of the many for the benefit of the few, how can we violate the rights of all for the benefit of all? But at what cost will this lesson be taught us? And, in order to obviate so frightful a danger, what ought the upper classes to do? Two things—renounce all privileges and monopolies themselves, and enlighten the masses, for there are only two things which can save society—Justice and Knowledge. They ought to inquire with earnestness whether they do not enjoy [p126] some monopoly or other, in order that they may renounce it—whether they do not profit by some artificial inequalities, in order that they may efface them—whether Pauperism is not in some measure attributable to a disturbance of the natural social laws, in order that they may put an end to it. They should be able to hold out their hands to the people, and say to them, These hands are full, but they are clean. Is this what they actually do? If I am not very much mistaken, they do just the reverse. They begin by guarding their monopolies, and we have seen them even turning the revolution to profit by attempting to extend these monopolies. After having deprived themselves of even the possibility of speaking the truth and appealing to principles, they endeavour to vindicate their consistency by engaging to treat the people as they have treated themselves, and dazzle them with the bait of Privilege. Only, they think themselves very knowing in conceding at present only a small privilege, the right to “assistance,” in the hope of diverting them from demanding a greater one—the right to employment. They do not perceive that to extend and systematize more and more the maxim, “Take from one to give to another,” is only to strengthen the illusion which creates difficulties for the present and dangers for the future.

We must not exaggerate, however. When the superior classes seek in privilege a remedy for the evils which privilege has caused, they are sincere, and act, I am convinced, rather from ignorance than from any desire to commit injustice. It is an irreparable misfortune that the governments which have succeeded each other in France have invariably discouraged the teaching of Political Economy. And it is a still greater misfortune that University Education fills all our heads with Roman prejudices; in other words, with all that is repugnant to social truth. This is what leads the upper classes astray. It is the fashion at present to declaim against these classes. For my own part, I believe that at no period have their intentions been more benevolent. I believe that they ardently desire to solve the social Problem. I believe that they would do more than renounce their privileges,—that they would sacrifice willingly, in works of charity, a part of the property they have acquired, if by that means they were satisfied that an end could be put to the sufferings of the working classes. It may be said, no doubt, that they are actuated by interest or fear, and that it is no great generosity to abandon a part of their fortune to save the remainder,—that it is, in fact, but the vulgar prudence of a man who insures his property against fire. But let us not thus calumniate human nature. Why should we refuse to [p127] recognise a motive less egotistical? Is it not very natural that the democratic sentiments which prevail in our country should render men alive to the sufferings of their brethren? But whatever may be the dominant sentiment, it cannot be denied that everything by which public opinion is influenced—philosophy, literature, poetry, the drama, the pulpit, the tribune, the daily press,—all these organs of opinion reveal not only a desire, but an ardent longing, on the part of the wealthier classes to resolve the great problem. Why, then, is there no movement on the part of our Legislative Assemblies? Because they are ignorant. Political Economy proposes to them this solution:—«Public Justice»,—«Private Charity». But they go off upon a wrong scent, and, obeying socialist influences, without being aware of the fact, they give charity a place in the statute-book, thereby banishing justice from it, and destroying by the same act private charity, which is ever prompt to recede before a compulsory poor-rate.

Why, then, do our legislators thus run counter to all sound notions? Why do they not leave things in their proper place,—Sympathy in its natural domain, which is Liberty,—Justice in its own, which is Law? Why do they not leave law to do its own exclusive work in furthering justice? Is it that they have no love of justice? No; it is that they have no confidence in it. Justice is Liberty and Property. But they are socialists without knowing it; and for the progressive diminution of poverty, and the indefinite expansion of wealth, let them say what they will, they have no faith either in liberty or property, nor, consequently, in justice. This is why we see them, in the sincerity of their hearts, seeking the realization of what is Good by the perpetual violation of what is Right.

‹Natural social laws› are the phenomena, taken in the aggregate, and considered in reference both to their motives and their results, which govern the transactions of men in a state of freedom.

That being granted, the question is, Are we to allow these laws to act, or are we to hinder them from acting?

The question, in fact, comes to this:

Are we to leave every man master of his liberty and property, his right to produce, and exchange his produce, as he chooses, whether to his benefit or detriment; or are we to interfere by means of law, which is Force, for the protection of these rights? Or, can we hope to secure a greater amount of social happiness by violating liberty and property, by interfering with and regulating labour, by disturbing exchanges, and shifting responsibility?

In other words: [p128]

Is Law to enforce rigorous Justice, or to be the instrument of Spoliation, organized with more or less adroitness?

It is very evident that the solution of these questions depends upon our knowledge and study of the natural laws of society. We cannot pronounce conclusively upon them until we have discovered whether property, liberty, the combination of services freely and voluntarily exchanged, lead to improvement and material prosperity, as the economists believe, or to ruin and degradation, as the socialists affirm.

In the first case, social evils must be attributed to disturbances of the natural laws, to legal violations of liberty and property, and these disturbances and violations must be put an end to. In that case Political Economy is right.

In the second case, it may be said, we have not yet had enough of Government interference. Forced and factitious combinations have not yet sufficiently superseded free and natural combinations. These three fatal principles, Justice, Liberty, Property, have still too powerful a sway. Our legislators have not yet attacked them boldly enough. We have not yet acted sufficiently on the maxim of ‹taking from one in order to give to another›. Hitherto we have taken from the many to give to the few. Now, we must take from all to give to all. In a word, we must organize Spoliation, and from Socialism must come our salvation.[28]

‹Fatal Illusions which spring from Exchange.›—Exchange is society. Consequently, economic truth consists in a complete view of Exchange; economic error in a partial view of it.

If man did not exchange, each economic phenomenon would be accomplished in a single individual, and it would be very easy to discover from observation its good and its bad effects.

But Exchange has given rise to the separation of occupations, or, in other words, to the establishment of trades and professions. Each service (or each product) has, then, two relations, one with the person who furnishes it, and the other with the person who receives it.

Undoubtedly, at the end of the evolution, man in a social state, like man in a state of isolation, is at once producer and consumer, but we must see clearly the difference. Man in an isolated state is always the producer of the very thing he consumes, which almost never happens with man in the social state. This is an unquestionable fact, which every one can verify for himself. It [p129] follows, moreover, from this that the social state consists in an interchange of services.

We are all producers and consumers, not of the thing, but of the value, that we have produced. In exchanging commodities we remain always possessed of their value.

It is this which gives rise to all economic errors and illusions, and it may not be useless to mark here the progress of the human mind in this respect.

We give the general name of ‹obstacle› to everything which, being interposed between our wants and our satisfactions, calls for the intervention of our efforts.

The relations of these four elements—want, obstacle, effort, satisfaction—are quite apparent, and easily understood in isolated man. We should never think of saying—

“It is a pity that Robinson Crusoe did not encounter more ‹obstacles›, for in that case he would have had more opportunities of exerting his energies—he would have been richer.”

“It is unfortunate that the sea should have cast upon the shore of the desert island useful articles, such as timber, provisions, arms, books; for this deprived him of the opportunity of exerting himself—it made him less rich.”

“It is to be regretted that Robinson invented nets to take fish and game, for that diminished by so much his efforts in relation to each given result—it made him less rich.”

“It is a pity that Robinson was not more frequently sick, for then he must have set to doctoring himself, which is labour; and as all wealth comes from labour, he would have been more wealthy on that account.”

“It is a pity that he succeeded in extinguishing the fire which threatened his cabin. He lost thus a precious opportunity of work—and was so much the poorer.”

“It is unfortunate that in the desert island the soil was not more ungrateful, the spring at a greater distance, the day shorter. For then Robinson must have exerted himself more to procure food, drink, and light, and he would have been so much the richer by the exertion.”

I say that no one in his senses would ever think of putting forth as oracles of truth propositions so absurd. It would be too glaring an evidence that wealth does not depend upon the intensity of the effort in proportion to the satisfaction obtained, and that it is just the contrary which is true. We should then understand that wealth consists neither in the Want, nor in the Obstacle, nor in the Effort, but in the Satisfaction; and we should not hesitate to [p130] acknowledge that, although Robinson Crusoe was both producer and consumer, yet, in order to judge of his progress, we must have reference, not to his labour, but to its results. In short, in laying down the axiom that “the paramount interest is that of the consumer,” we believe we are merely giving utterance to a ‹truism›.

Happy will it be for nations when they discern clearly how and why what we have found true or false of man in a state of isolation is equally true or false of man in his social state!

It is absolutely certain, however, that the five or six propositions which have appeared to us not only false, but absurd, when applied to the island of Juan Fernandez, appear, when applied to our own country, so incontestably true, that they serve as the basis of our whole economic legislation. On the other hand, the axiom which appears to us to be truth itself when applied to an individual, is never invoked in the name of society without calling forth a smile of contempt.

Is it true, then, that Exchange so alters our individual organization that what makes individual poverty constitutes social riches?

No, it is not true, but it is plausible—so very plausible as to be generally believed.

Society consists in this—that we work for one another. The more services we render, the more services we receive, and we receive more in proportion as our own are more appreciated—more in demand. On the other hand, the separation of occupations, the division of labour, causes each of us to apply his efforts to the removal of obstacles which stand in the way of the enjoyments of others. The agricultural labourer combats the obstacle called hunger—the physician, the obstacle called disease—the clergyman, the obstacle called vice—the author, the obstacle called ignorance—the coal miner, the obstacle called cold, etc., etc.

And as those around us are more disposed to remunerate our services in proportion as they feel more keenly the particular obstacle which stands in their own way, it follows that we are all disposed, in this point of view, and as producers, to magnify the obstacle which it is our peculiar business to overcome. We consider ourselves richer if such obstacles are multiplied, and we reason from particulars to generals—from our own individual advantage to the public good.[29] . . . . [p131]

Spotted a typo or a problem in this chapter? Tell us

V. OF VALUE

All dissertations are wearisome—a dissertation on Value the most wearisome of all.

What unpractised writer, who has had to face an Economic problem, but has tried to resolve it without reference to any definition of value?

Yet he soon finds he has engaged in a vain attempt. The theory of Value is to Political Economy what numeration is to arithmetic. In what inextricable confusion would not Bezout have landed himself, if, to save labour to his pupils, he had undertaken to teach them the four rules and proportion, without having previously explained the value which the figures derive from their form and position?

The truth is, if the reader could only foresee the beautiful consequences deducible from the theory of Value, he would undertake the labour of mastering the first principles of Economical Science with the same cheerfulness that one submits to the drudgery of Geometry, in prospect of the magnificent field which it opens to our intelligence.

But this intuitive foresight is not to be expected; and the more pains I should take to establish the distinction between Value and Utility, or between Value and Labour, in order to show how natural it is that this should form a stumbling-block at the very threshold of the science, the more wearisome I should become. The reader would see in such a discussion only barren and idle subtleties, calculated at best to satisfy the curiosity of Economists by profession.

You are inquiring laboriously, it may be said, whether wealth consists in the Utility of things, or in their Value, or in their rarity. Is not this like the question of the schoolmen, Does form reside in the substance or in the accident? Are you not afraid [p132] that some street Molière will hold you up to public ridicule at the Théâtre des Variétés?

Yet truth obliges me to say that, in an economical point of view, Society is Exchange. The primary element of Exchange is the notion of ‹Value›, so that every truth and every error which this word introduces into men’s minds is a social truth or error.

I undertake in this work to demonstrate the Harmony of those laws of Providence which govern human society. What makes these laws harmonious and not discordant is, that all principles, all motives, all springs of action, all interests, co-operate towards a grand final result, which humanity will never reach by reason of its native ‹imperfection›, but to which it will always approximate more and more by reason of its unlimited ‹capability of improvement›. And that result is, the indefinite approximation of all classes towards a level, which is always rising; in other words, the ‹equalization› of individuals in the general ‹amelioration›.

But to attain my object. I must explain two things, namely,

‹1st›, That ‹Utility› has a tendency to become more and more ‹gratuitous›, more and more ‹common›, as it gradually recedes from the domain of individual ‹appropriation›.

‹2d›, That ‹Value›, on the other hand, which alone is capable of appropriation, which alone constitutes property legitimately and in fact, has a tendency to diminish more and more in relation to the utility to which it is attached.

Such a demonstration—founded on Property, but only on the property of which Value is the subject, and on Community, but only on the community of utility,—such a demonstration, I say, must satisfy and reconcile all schools, by conceding to them that all have had a glimpse of the truth, but only of partial truth, regarded from different points of view.

Economists! you defend property. There is in the social order no other property than that of which ‹Value› is the subject, and that is immovable and unassailable.

Communists! you dream of Community. You have got it. The social order renders all ‹utilities› common, provided the exchange of those values which have been appropriated is free.

You are like architects who dispute about a monument of which each has seen only one side. They don’t see ‹ill›, but they don’t see ‹all›. To make them agree, it is only necessary to ask them to walk round the edifice.

But how am I to reconstruct the social edifice, so as to exhibit to mankind all its beautiful harmony, if I reject its two corner stones. Utility and Value? How can I bring about the desired [p133] reconciliation of various schools upon the platform of truth if I shun the analysis of these two ideas, although the dissidence has arisen from the unhappy confusion which they have caused?

I have felt this kind of introduction necessary, in order, if possible, to secure from the reader a moment’s attention, and relieve him from fatigue and ennui. I am much mistaken if the consoling beauty of the consequences will not amply make up for the dryness of the premises. Had Newton allowed himself to be repulsed at the outset by a distaste for elementary mathematics, never would his heart have beat with rapture on beholding the harmonies of the celestial mechanism; and I maintain that it is only necessary to make our way manfully to an acquaintance with certain first principles, in order to be convinced that God has displayed in the social mechanism goodness no less touching, simplicity no less admirable, splendour no less magnificent.

In the first chapter we viewed man as both ‹active› and ‹passive›, and we saw that ‹Want› and ‹Satisfaction›, acting on ‹sensibility› alone, were in their own nature personal, peculiar, and intransmissible; that ‹Effort›, on the contrary, the connecting link between Want and Satisfaction, the ‹mean› term between the motive principle of action and the end we have in view, proceeding from our ‹activity›, our spontaneity, our will, was susceptible of conventions and of transmission. I know that, metaphysically, no one can contest this assertion, and maintain that Effort also is personal. I have no desire to enter the territory of ideology, and I hope that my view of the subject will be admitted without controversy when put in this vulgar form:—We cannot ‹feel› the wants of others—we cannot ‹feel› the satisfactions of others; but we can ‹render service› one to another.

It is this transmission of efforts, this exchange of services, which forms the subject of Political Economy; and since, on the other hand, economical science is condensed and summed up in the word ‹Value›, of which it is only a lengthened explanation, it follows that the notion of value would be imperfectly, erroneously, conceived if we were to found it upon the extreme phenomena of our sensibility—namely, our ‹Wants› and ‹Satisfactions›—phenomena which are personal, intransmissible, and ‹incommensurable› as between two individuals, in place of founding it on the manifestations of our ‹activity›, upon ‹efforts›, upon reciprocal ‹services›, which are interchanged because they are susceptible of being compared, appreciated, ‹estimated›, and which are capable of being estimated precisely because they are capable of being interchanged.

In the same chapter we arrived at the following formulas:— [p134]

“‹Utility› (the property which certain things and certain acts have of serving us, of being useful to us) is complex,—one part we owe to the action of nature, another to the action of man.”—“With reference to a given result, the more nature has done the less remains for human action to do.”—“The co-operation of nature is essentially ‹gratuitous›—the co-operation of man, whether intellectual or muscular, exchanged or not, collective or solitary, is essentially ‹onerous›, as indeed the word ‹Effort› implies.”

And as what is ‹gratuitous› cannot possess ‹value›, since the idea of ‹value› implies ‹onerous› acquisition, it follows that the notion of Value would be still erroneously conceived, if we were to extend it, in whole or in part, to the gifts or to the co-operation of nature, instead of restricting it exclusively to human co-operation.

Thus, from both sides, by two different roads, we arrive at this conclusion, that ‹value› must have reference to the ‹efforts› which men make in order to obtain the ‹satisfaction› of their ‹wants›.

In the third chapter we have established that man cannot exist in a state of isolation. But if, by an effort of imagination, we fancy him placed in that chimerical situation, that state ‹contrary to nature›, which the writers of the eighteenth century extolled as the ‹state of nature›, we shall not fail to see that it does not disclose to us the idea of Value, although it presents the manifestation of the active principle which we have termed ‹effort›. The reason is obvious. Value implies comparison, appreciation, ‹estimation›, measure. In order that two things should measure each other, it is necessary that they be commensurable, and, in order to that, they must be of the same kind. In a state of isolation, with what could we compare effort? With want? With satisfaction? In that case, we could go no farther than to pronounce that the effort was more or less appropriate, more or less opportune. In the social state, what we compare (and it is this comparison which gives rise to the idea of Value) is the effort of one man with the effort of another man,—two phenomena of the same nature, and, consequently, ‹commensurable›.

Thus, the definition of the word Value, in order to be exact, must have reference not only to human efforts, but likewise to those efforts which are exchanged or exchangeable. Exchange does more than exhibit and measure values—it gives them existence. I do not mean to say that it gives existence to the acts and the things which are exchanged, but it imparts to their existence the notion of ‹value›.

Now, when two men transfer to each other their present efforts, or make over mutually the results of their anterior [p135] efforts, they ‹serve› each other; they render each other reciprocal ‹service›.

I say, then, «Value is the relation of two services exchanged».

The idea of ‹value› entered into the world the first time that a man having said to his brother, Do this for me, and I shall do that for you—they have come to an agreement; for then, for the first time, we could say—The two ‹services› exchanged are ‹worth each other›.

It is singular enough that the true theory of value, which we search for in vain in many a ponderous volume, is to be found in Florian’s beautiful fable of ‹l’Aveugle et le Paralytique›,—

Aidons—nous mutuellement, La charge des malheurs en sera plus légère. . . . . . . . A nous deux Nous possédons le bien à chacun nécessaire. J’ai des jambes, et vous des yeux. Moi, je vais vous porter; vous, vous serez mon guide: Ainsi, sans que jamais notre amitié décide Qui de nous deux remplit le plus utile emploi, Je marcherai pour vous, vous y verrez pour moi.

Here you have value discovered and defined. Here you have it in its rigorous economic exactitude, excepting the touching trait relative to friendship, which carries us into another sphere, that of sympathy. We may conceive two unfortunates rendering each other reciprocal ‹service›, without inquiring too curiously ‹which of the two discharged the most useful employment›. The exceptional situation imagined by the fabulist explains sufficiently that the principle of sympathy, acting with great force, comes to absorb, so to speak, the minute appreciation of the services exchanged—an appreciation, however, which is indispensable in order to disengage completely the idea of Value. That idea would be complete if all men, or the majority of them, were struck with paralysis or blindness; for the inexorable law of supply and demand would then predominate, and, causing the permanent sacrifice accepted by him who fulfils the more useful employment to disappear, would restore the transaction to the domain of justice.

We are all blind or impotent in some respects, and we soon come to understand that, by assisting each other, ‹the burden of misfortune is lightened›. Hence «Exchange». We labour in order to feed, clothe, shelter, enlighten, cure, defend, instruct one another. Hence reciprocal «Services». We compare, we discuss, we ‹estimate› or ‹appreciate› these services. Hence «Value».

A multitude of circumstances may augment the relative importance of a Service. We find it greater or less, according as it is more or less useful to us—according as a greater or less number of [p136] people are disposed to render it to us—according as it exacts from them more or less labour, trouble, skill, time, previous study,—and according as it saves more or less of these to ourselves. Value depends not only on these circumstances, but on the judgment we form of them; for it may happen, and it happens frequently, that we esteem a service very highly because we judge it very useful, while in reality it is hurtful. This is the reason why vanity, ignorance, error, exert a certain influence on the essentially elastic and flexible relation which we denominate ‹value›; and we may affirm that the appreciation of services tends to approximate more to absolute truth and justice in proportion as men become more enlightened, more moral, and more refined.

Hitherto the principle of Value has been sought for in one of those circumstances which augment or which diminish it, materiality, durableness, utility, scarcity, labour, difficulty of acquisition, judgment, etc., and hence a false direction has been given to the science from the beginning; for the accident which modifies the phenomenon is not the phenomenon itself. Moreover, each author has constituted himself the sponsor, so to speak, of some special circumstance which he thinks preponderates,—the constant result of generalizing; for all is in all, and there is nothing which we cannot comprehend under a term by means of extending its sense. Thus the principle of value, according to Adam Smith, resides in materiality and durability; according to Jean Baptiste Say, in utility; according to Ricardo, in labour; according to Senior, in rarity; according to Storch, in the judgment we form, etc.

The consequence has been what might have been expected. These authors have unwittingly injured the authority and dignity of the science by appearing to contradict each other; while in reality each is right, as from his own point of view. Besides, they have involved the first principles of Political Economy in a labyrinth of inextricable difficulties; for the same words, as used by these authors, no longer represent the same ideas; and, moreover, although a circumstance may be proclaimed fundamental, other circumstances stand out too prominently to be neglected, and definitions are thus constantly enlarged.

The object of the present work is not controversy, but exposition. I explain what I myself see, not what others have seen. I cannot avoid, however, calling the attention of the reader to the circumstances in which the foundation of Value has hitherto been sought for. But, first of all, I must bring Value itself before him in a series of examples, for it is by divers applications that the mind lays hold of a theory. [p137]

I shall demonstrate how all is definitely resolved into a barter of services; but it is necessary to keep in mind what has been said on the subject of barter in the preceding chapter. It is rarely simple—sometimes it forms a circular or round-about transaction among several parties,—most frequently, by the intervention of money, it resolves itself into two factors, ‹sale› and ‹purchase›; but as this complication does not change its nature, I may be permitted, for the sake of perspicuity, to assume the barter to be direct and immediate. This will lead to no mistake as to the nature of Value.

* * * * *

We are all born with an imperious material want, which must be satisfied under pain of death, I mean that of breathing. On the other hand, we all exist in a medium which, in general, supplies that want without the intervention of any effort on our part. Atmospheric air, then, has utility without having ‹value›. It has no Value, because, requiring no Effort, it gives rise to no service. To render a service to any one is to save him trouble; and where it is not necessary to take pains in order to realize a satisfaction, no trouble can be saved.

But if a man descend to the bottom of a river in a diving-bell, a foreign substance is interposed between the air and his lungs, and, in order to re-establish the communication, a pump must be employed. Here there is an effort to make, pains to take, and the man below desires the exertion, for it is a matter of life or death, and he cannot possibly secure to himself a greater ‹service›.

Instead of making this effort himself, he calls on me to make it for him, and, in order to induce me to do so, he undertakes in turn to make an exertion from which I may reap satisfaction. We discuss the matter, and come to an agreement. Now, what do we discover here? two wants, two satisfactions, which are not inconsistent with each other; two efforts, which are the subject of a voluntary transaction; two ‹services›, which are exchanged,—and ‹value› makes its appearance.

Now, we are told that utility is the foundation of value; and as utility is inherent in the air, we are led to think that it is the same in regard to value. There is here an evident confusion of ideas. The air, from its nature, has physical properties in harmony with one of our physical organs, the lungs. The portion which I draw from the atmosphere in order to fill the diving-bell does not change its nature—it is still oxygen and azote. No new physical quality is combined with it, no reacting power brings out of it a new element called ‹value›. ‹That› springs exclusively from the service rendered. [p138]

If, in laying down the general principle, that Utility is the foundation of Value, you mean that the Service has value because it is useful to him who receives it and pays for it, I allow the truth of what you say. It is a truism implied in the very word ‹service›.

But we must not confound the utility of the air with the utility of the service. They are two utilities distinct from each other, different in nature, different in kind, which bear no proportion to one another, and have no necessary relation. There are circumstances in which, with very slight exertion, by rendering a very small service, or saving very little trouble, I may bring within the reach of another an article of very great intrinsic ‹utility›.

Take the case of the diving-bell, and consider how the parties to the supposed bargain manage to estimate the value of the ‹service› rendered by the one to the other in supplying him with atmospheric air. We must have a point of comparison, and that point of comparison can only be in the ‹service› which the diver renders in return. Their reciprocal demands will depend on their relative situation, on the intensity of their desires, on the greater or less need they have of each other, and on a multitude of circumstances which demonstrate that the value is in the Service, since it increases with the service.

The reader may easily vary the hypothesis, so as to convince himself that the Value is not necessarily proportionate to the intensity of the efforts,—a remark which I set down here as a connecting link in the chain of reasoning, and of which I shall afterwards have occasion to make use; for my object is to prove that Value no more resides in labour than it does in utility.

Nature has so constituted me that I must die if I am deprived of an opportunity, from time to time, of quenching my thirst, and the well is a league from the village. For this reason, I take the trouble every morning to go thither to fetch the water of which I have need, for in water I have recognised those ‹useful› qualities which are calculated to assuage the suffering called thirst. Want, Effort, Satisfaction—we have them all here. I have found Utility—I have not yet found Value.

But, as my neighbour goes also to the fountain, I say to him—“‹Save me the pains› of this journey—‹render me the service› of bringing me water. During the time you are so occupied, I shall do something for you, I shall teach your child to spell.” This arrangement suits us both. Here is an exchange of two services, and we are enabled to pronounce that the one is ‹worth› the other. The things compared here are two efforts, not two wants and two [p139] satisfactions; for by what common standard should we compare the benefit of drinking water and that of learning to spell?

By-and-by I say to my neighbour—“Your child troubles me—I should like better to do something else for you. You shall continue to bring me water, and I shall give you twopence.” If the proposal is agreed to, the Economist may, without fear of mistake, pronounce that ‹the service› «IS WORTH» ‹twopence›.

Afterwards, my neighbour no longer waits to be requested. He knows by experience that every day I want water. He anticipates my wishes. At the same time, he provides water for the other villagers. In short, he becomes a water merchant. It is then that we begin to say, ‹the water› «IS WORTH» ‹twopence›.

Has the water, then, changed its nature? Has the Value, which was but now in the service, become materialized and incorporated in the water, as if it were a new chemical element? Has a slight modification in the form of the arrangement between my neighbour and me had the power to displace the principle of ‹value› and change its nature? I am not purist enough to find fault with your saying that the ‹water is worth twopence›, just as you say ‹the sun sets›. But we must remember that metaphors and metonymies do not affect the truth of facts; and that, in strict scientific language, value can no more be said to reside in the water than the sun can be said to go to rest in the sea.

Let us attribute, then, to things the peculiar qualities which belong to them—to air, to water, ‹utility›—to services, ‹value›. We may say with propriety that water is ‹useful›, because it has the property of allaying thirst; and it is the service which ‹has value›, because it is the subject of a convention previously debated and discussed. So true is this, that if the well is brought nearer, or removed to a greater distance, the Utility of the water remains the same, but its value is diminished or increased. Why? because the ‹service› is less or greater. The ‹value›, then, is in the ‹service›, seeing that it is increased or diminished according as the service is increased or diminished.

The ‹diamond› makes a great figure in works of Political Economy. It is adduced as an illustration of the laws of Value, or of the supposed disturbance of those laws. It is a brilliant weapon with which all the schools do battle. The English school asserts that “Value resides in labour.” The French school exhibits a diamond, and says—“Here is a commodity which exacts no labour and yet is of immense value.” The French school affirms that the foundation of value is utility, and the English school immediately brings forward the diamond in opposition to the [p140] illustrations drawn from air, light, and water. “The air is very useful,” says the English Economist, “but it possesses no value; the ‹utility› of the diamond is almost inappreciable, and yet it possesses more ‹value› than the whole atmosphere;” and the reader is inclined to say with Henri Quatre—“In sooth, they are both right.” They end by landing themselves in an error more fatal than both the others, and are forced to avow that ‹value› resides in the works of nature, and that that value is ‹material›.

My definition, as it seems to me, gets rid of these anomalies, and is confirmed rather than invalidated by the illustration which has been adduced.

I take a walk along the sea-beach, and I find by chance a magnificent diamond. I am thus put in possession of a great ‹value›. Why? Am I about to confer a great benefit on the human race? Have I devoted myself to a long and laborious work? Neither the one nor the other. Why, then, does this diamond possess so much value? Undoubtedly because the person to whom I transfer it considers that I have rendered him a great ‹service›,—all the greater that many rich people desire it, and that I alone can render it. The grounds of his judgment may be controverted—be it so. It may be founded on pride, on vanity—granted again. But this judgment has, nevertheless, been formed by a man who is disposed to act upon it, and that is sufficient for my argument.

Far from the judgment being based on a reasonable appreciation of ‹utility›, we may allow that the very reverse is the case. Ostentation makes great sacrifices for what is utterly ‹useless›.

In this case, the value, far from bearing a necessary proportion to the labour ‹performed› by the person who renders the service, may be said rather to bear proportion to the labour ‹saved› to the person who receives it. This general law of value, which has not, so far as I know, been observed by theoretical writers, nevertheless prevails universally in practice. We shall explain afterwards the admirable mechanism by which value tends to proportion itself to labour when it is free; but it is not the less true that it has its principle and foundation less in the effort of the person who ‹serves› than in the effort saved to him who ‹is served›.

The transaction relative to the diamond may be supposed to give rise to the following dialogue:—

“Give me your diamond, Sir.”

“With all my heart; give me in exchange your labour for an entire year.” [p141]

“Your acquisition has not cost you a minute’s work.”

“Very well, Sir, try to find a similar lucky minute.”

“Yes; but, in strict equity, the exchange ought to be one of ‹equal labour›.”

“No; in strict equity, you put a value on your own services, and I upon mine; I don’t force you; why should you lay a constraint upon me? Give me a whole year’s labour, or seek out a diamond for yourself.”

“But that might entail upon me ten years’ work, and would probably end in nothing. It would be wiser and more profitable to devote these ten years to another employment.”

“It is precisely on that account that I imagined I was rendering you a ‹service› in asking for only one year’s work. I thus save you nine, and that is the reason why I attach great ‹value› to the ‹service›. If I appear to you exacting, it is because you regard only the labour which I have performed; but consider also the labour which I save you, and you will find me reasonable in my demand.”

“It is not the less true that you profit by a work of nature.”

“And if I were to give away what I have found for little or nothing, it is you who would profit by it. Besides, if this diamond possesses great value, it is not because nature has been elaborating it since the beginning of time: she does as much for a drop of dew.”

“Yes; but if diamonds were as common as dew-drops, you could no longer lay down the law to me, and make your own conditions.”

“Very true; because, in that case, you would not address yourself to me, or would not be disposed to recompense me highly for a ‹service› which you could easily perform for yourself.”

The result of this dialogue is, that Value no more resides in the diamond than in the air or in the water. It resides exclusively in the ‹services› which we suppose to be rendered and received with reference to these things, and is determined by the free bargaining of the parties who make the exchange.

Take up the ‹Collection des Économistes›, and read and compare all the definitions which you will find there. If there be one of them which meets the cases of the air and the diamond, two cases in appearance so opposite, throw this book into the fire. But if the definition which I propose, simple as it is, solves, or rather obviates, the difficulty, you are bound in conscience, gentle reader, to go on to the end of the work, or it is in vain that we have placed an inviting sign-board over the vestibule of the science.

Allow me to give some more examples, in order to elucidate clearly my thoughts, and familiarize the reader with a new definition. By exhibiting this fundamental principle in different aspects, [p142] we shall clear the way for a thorough comprehension of the consequences, which I venture to predict will be found no less important than unexpected.

Among the wants to which our physical constitution subjects us is that of food; and one of the articles best fitted to satisfy that want is Bread.

As the need of food is personal to me, I should, naturally, myself perform all the operations necessary to provide the needful supply of bread. I can the less expect my fellow-men to render me gratuitously this service, that they are themselves subject to the same want, and condemned to the same exertion.

Were I to make my own bread, I must devote myself to a labour infinitely more complicated, but strictly analogous to that which the necessity of fetching water from the spring would have imposed upon me. The elements of bread exist everywhere in nature. As J. B. Say has judiciously remarked, it is neither possible nor necessary for man to create anything. Gases, salts, electricity, vegetable life, all exist; my business is to unite them, assist them, combine them, transport them, availing myself of that great laboratory called the earth, in which mysteries are accomplished from which human science has scarcely raised the veil. If the operations to which I must devote myself in the pursuit of my design are in the aggregate very complicated, each of them, taken singly, is as simple as the act of drawing water from the fountain. Every effort I make is simply a service which I render to myself; and if, in consequence of a bargain freely entered into, it happens that other persons save me some of these efforts, or the whole of them, these are so many ‹services› which I receive. The aggregate of these services, compared with those which I render in return, constitute the value of the Bread and determine its amount.

A convenient intermediate commodity intervenes to facilitate this exchange of services, and even to serve as a measure of their relative importance—Money. But this makes no substantial difference,—the principle remains exactly the same, just as in mechanics the transmission of forces is subject to the same law, whether there be one or several intermediate wheels.

This is so true that, when the loaf is worth fourpence, for example, if a good bookkeeper wishes to analyze its value, he will succeed in discovering, amid the multiplicity of transactions which go to the accomplishment of the final result, all those whose services have contributed to form that value,—all those who have saved labour to the man who finally pays for it as the consumer. He discovers, first of all, the baker, who retains his five per cent., [p143] and from that percentage remunerates the mason who has built his oven, the wood-cutter who prepares his billets, etc. Then comes the miller, who receives not only the recompense of his own labour, but the means of remunerating the quarryman who has furnished his millstones, the labourer who has formed his dam, etc. Other portions of the total value go to the thresher, the reaper, the labourer, the sower, until you account for the last farthing. No part of it assuredly goes to remunerate God and nature. The very idea is absurd, and yet this is rigorously implied in the theory of the Economists, who attribute a certain portion of the value of a product to matter or natural forces. No; we still find that what ‹has value› is not the Loaf, but the series of ‹services› which have put me in possession of it.

It is true that, among the elementary parts of the value of the loaf, our book-keeper will find one which he will have difficulty in connecting with a ‹service›, at least a service implying effort. He will find of the fourpence, of which the price is made up, a part goes to the proprietor of the soil, to the man who has the keeping of the laboratory. That small portion of the value of the loaf constitutes what is called the ‹rent of land›; and, misled by the form of expression, by the metonymy which again makes its appearance here, our calculator may be tempted to think that this portion is allotted to natural agents—to the soil itself.

I maintain that, if he exercises sufficient skill, he will find that this is still the price of real ‹services›—services of the same kind as all the others. This will be demonstrated with the clearest evidence when we come to treat of ‹landed property›. At present, I shall only remark, that I am not concerned here with property, but with ‹value›. I don’t inquire whether all services are real and legitimate, or whether men do not sometimes succeed in getting paid for services which they do not render. The world, alas! is full of such injustices, but ‹rent› must not be included among them.

All that I have to demonstrate here is, that the pretended value of ‹commodities› is only the value of ‹services›, real or imaginary, received and rendered in connexion with them—that value does not reside in the commodities themselves, and is no more to be found in the loaf than in the diamond, the water, or the air—that no part of the remuneration goes to nature—that it proceeds from the final consumer of the article, and is distributed exclusively among men,—and that it would not be accorded to them by him for any other reason than that they have rendered him services, unless, indeed, in the case of violence or fraud.

Two men agree that ice is a good thing in summer, and coal a [p144] still better thing in winter. They supply two of our wants—the one cools, the other warms us. We do not fail to remark that the Utility of these commodities consists in certain ‹material› properties suitably adapted to our ‹material› organs. We remark, moreover, that among those properties, which physics and chemistry might enumerate, we do not find ‹value›, or anything like it. How, then, have we come to regard value as inherent in matter and material?

If the two men we have supposed wished to obtain the satisfaction of their wants, without acting in concert, each would labour to provide for himself both the articles wanted. If they came to an understanding, the one would provide coal for two from the coal-mine, the other ice for two from the mountain. This presupposes a bargain. They must then adjust the relation of the two services exchanged. They would take all circumstances into account—the difficulties to be overcome, the dangers to be braved, the time to be spent, the pains to be taken, the skill to be displayed, the risks to be run, the possibility of providing for their wants in some other way, etc., etc. When they came to an understanding, the Economist would say, The two ‹services› exchanged ‹are worth› each other. In common language, it would be said by metonymy—Such a quantity of coal ‹is worth› such a quantity of ice, as if the value had passed physically into these bodies. But it is easy to see that if the common form of expression enables us to state the results, the scientific expression alone reveals to us the true causes.

In place of two services and two persons, the agreement may embrace a greater number, substituting a complex Exchange for simple Barter. In that case, money would intervene to facilitate the exchange. Need I say that the principle of value would be neither changed nor displaced?

But I must add here a single observation ‹àpropos› of coal. It may be that there is only one coal-mine in a country, and that an individual has got possession of it. If so, this man will make conditions; that is to say, he will put a high price upon his ‹services›, or pretended ‹services›.

We have not yet come to the question of right and justice, to the distinction between true and loyal services, and those that are fraudulent and pretended. What concerns us at this moment is, to consolidate the true theory of value, and to disembarrass it of one error with which Economical science is infected. When we say that what nature has done or given, she has done or given ‹gratuitously›, and that the notion of ‹value› is excluded, we are answered by an analysis of the price of coal, or some other natural product. It is acknowledged, indeed, that the greater part of this [p145] price is the remuneration of the services of man. One man has excavated the ground, another has drained away the water, another has raised the fuel to the surface, another has transported it to its destination; and it is the aggregate of these works, it is allowed, which constitutes ‹nearly› the entire ‹value›. Still there remains one portion of the ‹value› which does not correspond with any labour or ‹service›. This is the value of the coal as it lies under the soil, still virgin, and untouched by human labour. It forms the share of the proprietor; and, since this portion of Value is not of human creation, it follows necessarily that it is the creation of nature.

I reject that conclusion, and I premonish the reader that, if he admits it to a greater or less extent, he cannot proceed a single step farther in the science. No; the action of nature does not create Value, any more than the action of man creates matter. Of two things one: either the proprietor has usefully co-operated towards the final result, and has rendered real services, and then the portion of value which he has conferred on the coal enters into my definition; or else he obtrudes himself as a parasite, and, in that case, he has had the address to get paid for ‹services› which he has not rendered, and the price of the coal is unduly augmented. That circumstance may prove, indeed, that injustice has entered into the transaction; but it cannot overturn the theory so as to authorize us to say that this portion of value is material,—that it is combined as a physical element with the gratuitous gifts of Providence. Here is the proof of it. Cause the injustice to cease, if injustice there be, and the corresponding value will disappear, which it assuredly would not have done had the value been inherent in matter and of natural creation.[30]

* * * * *

Let us now pass to one of our most imperious wants, that of ‹security›.

A certain number of men land upon an inhospitable coast. They begin to work. But each of them finds himself constantly drawn away from his employment by the necessity of defending himself against wild beasts, or men still more savage. Besides the time and the exertion which he devotes directly to the work of defence, he has to provide himself with arms and munitions. At length it is discovered that, on the whole, infinitely less power and effort would be wasted if some of them, abandoning other work, were to devote themselves exclusively to this ‹service›. This [p146] duty is assigned to those who are most distinguished for address, courage, and vigour—and they improve in an art which they make their exclusive business. Whilst they watch over the public safety, the community reaps from its labours, now no longer interrupted, more satisfactions ‹for all› than it loses by the diversion of ten men from other avocations. This arrangement is in consequence made. What do we see in it but a new progress in the ‹division of occupations›, inducing and requiring an exchange of ‹services›?

Are the services of these soldiers, guards, militiamen, or whatever you may call them, ‹productive›? Undoubtedly they are, seeing that the sole object of the arrangement is to increase the proportion which the aggregate Satisfactions of the community bear to the general efforts.

Have they ‹Value›? They must have it, since we esteem them, appreciate them, ‹estimate› their worth, and, in fine, pay for them with other ‹services› with which they are compared.

The form in which this remuneration is stipulated for, the mode of levying it, the process we adopt in adjusting and concluding the arrangement, make no alteration on the principle. Are there efforts saved to some men by others? Are there satisfactions procured for some by others? In that case there are ‹services› exchanged, compared, ‹estimated›;—there is ‹Value›.

The kind of services we are now discussing, when social complications occur, lead sometimes to frightful consequences. The very nature of the services which we demand from this class of functionaries requires us to put into their hands Power,—power sufficient to subdue all resistance,—and it sometimes happens that they abuse it, and turn it against the very community which employs them. Deriving from the community services proportioned to the want we have of ‹security›, they themselves may cause insecurity, in order to display their own importance, and, by a too skilful diplomacy, involve their fellow-citizens in perpetual wars.

All this has happened, and still happens. Great disturbances of the just equilibrium of reciprocal services are the result of it. But it makes no change in the fundamental principle and scientific theory of Value.

* * * * *

I must still give another example or two; but I pray the reader to believe that I feel quite as much as he can how tiresome and fatiguing this series of hypotheses must be—throwing us back, as they all do, on the same kind of proof, tending to the same [p147] conclusion, expressed in the same terms. He must understand, however, that this process, if not the most interesting, is at least the surest way of establishing the true theory of Value, and of thus clearing the road we have to traverse.

We suppose ourselves in Paris. In that great metropolis there is a vast fermentation of desires, and abundant means also of satisfying them. Multitudes of rich men, or men in easy circumstances, devote themselves to industry, to the arts, to politics—and in the evening they are all eager to obtain an hour’s recreation. Among the amusements which they relish most is the pleasure of hearing the music of Rossini sung by Malibran, or the admirable poetry of Racine interpreted by Rachel. There are in the world only two women who can furnish these noble and delicate kinds of entertainment, and unless we could subject them to torture, which would probably not succeed, we have no other way of procuring their services but by addressing ourselves to their good will. Thus the services which we expect from Malibran and Rachel are possessed of great ‹Value›. This explanation is prosaic enough, but it is true.

If an opulent banker should desire to gratify his vanity by having the performances of one of these great ‹artistes› in his ‹salons›, he will soon find by experience the full truth of my theory. He desires a rich treat, a lively satisfaction—he desires it eagerly—and only one person in the world can furnish it. He cannot procure it otherwise than by offering a large remuneration.

Between what extreme limits will the transaction oscillate? The banker will go on till he reaches the point at which he prefers rather to lose the satisfaction than to pay what he deems an extravagant price for it; the singer to that point at which she prefers to accept the remuneration offered, rather than not be remunerated at all. This point of equilibrium determines the value of this particular service, as it does of all others. It may be that in many cases custom fixes this delicate point. There is too much taste in the ‹beau monde› to ‹higgle› about certain services. The remuneration may even be gracefully disguised, so as to veil the vulgarity of the economic law. That law, however, presides over this transaction, just as it does over the most ordinary bargain; and Value does not change its nature because experience or urbanity dispenses with discussing it formally on every occasion.

This explains how ‹artistes› above the usual standard of excellence succeed in realizing great fortunes. Another circumstance favours them. Their services are of such a nature that they can render them, at one and the same time, and by one and the same effort, to [p148] a multitude of individuals. However large the theatre, provided the voice of Rachel can fill it, each spectator enjoys the full pleasure of her inimitable declamation. This is the foundation of a new arrangement. Three or four thousand people, all experiencing the same desire, may come to an understanding, and raise the requisite sum; and the contribution of each to the remuneration of the great ‹tragedienne› constitutes the equivalent of the unique service rendered by her to all at once. Such is ‹Value›.

As a great number of auditors may combine in order to witness an entertainment of this description, so a number of actors may combine in order to perform in an opera or play. Managers may intervene, to save them the trouble of a multiplicity of trifling accessory arrangements. Value is thus multiplied, ramified, distributed, and rendered complex—but it does not change its nature.

We shall finish with some exceptional cases. Such cases form the best test of a sound theory. When the rule is correct, exceptions do not invalidate, but confirm it.

An aged priest moves slowly along, pensive, with staff in hand, and breviary under his arm. His air is serene, his countenance expressive,—he looks inspired! Where is he going? Do you see that church in the distance? The youthful village parson, distrustful as yet of his own powers, has called to his assistance the old missionary. But first of all he has some arrangements to make. The preacher will find, indeed, food and shelter at the parsonage—but he must live from one year’s end to another. Mons. le Curé, then, has promoted a subscription among the rich people of the village, moderate in amount, but sufficient; for the aged pastor is not exacting, and answered the person who wrote to him—“Du pain pour moi, voilà mon nécessaire; une obole pour le pauvre, voilà mon superflu.”

Thus are the economic preliminaries complied with; for this meddling Political Economy creeps into everything, and is to be found everywhere—‹Nil humani a me alienum puto›.

Let us enlarge a little on this example, which is very apposite to what we are now discussing.

Here you have an exchange of services. On the one hand you have an old man who devotes his time, his strength, his talents, his health, to enlighten the minds of a few villagers, and raise them to a higher moral level. On the other hand, bread for a few days, and a hat and cassock, are assured to the man of eloquence.

But there is something more here. There is a rivalry of sacrifices. The old priest refuses everything that is not absolutely indispensable. Of that poor pittance the curé takes one half on his [p149] own shoulders; the village Crœsuses exempt their brethren from the other half, who nevertheless profit by the sermons.

Do these sacrifices invalidate our definition of value? Not at all. Each is free to render his services only on such terms as are agreeable to himself. If these conditions are made easy, or if none are stipulated for, what is the consequence? The ‹service›, preserving its utility, loses its value. The old priest is persuaded that his services will find their reward in another world, and he cares not for their being recompensed here below. He feels, no doubt, that he is rendering a service to his auditors in addressing them, but he also feels that they do him a service in listening to him. Hence it follows that the transaction is based upon advantage to one of the contracting parties, with the full consent of the other. That is all. In general, exchanges are determined and estimated by reference to self-interest; but, thank God, that is not always the case: they are sometimes based on the principle of sympathy, and in that case we either transfer to another a satisfaction which we might have reserved for ourselves, or we make an effort for him which we might have devoted to our own profit and advantage. Generosity, devotion, self-sacrifice, are impulses of our nature, which, like many other circumstances, influence the actual ‹value› of a particular service, but they make no change on the general law of ‹values›.

In contrast to this consoling example, I might adduce another of a very opposite character. In order that a service should possess value, in the economical sense of the word, it is not at all indispensable that it should be a real, conscientious, and useful service; it is sufficient that it is accepted, and paid for by another service. The world is full of people who palm upon the public services of a quality more than doubtful, and make the public pay for them. All depends on the ‹judgment› which we form in each case; and this is the reason why morals will be always the best auxiliary of Political Economy.

Impostors succeed in propagating a false belief. They represent themselves as the ambassadors of Heaven. They open at pleasure the gates of heaven or of hell. When this belief has once taken firm root, “Here,” say they, “are some little images to which we have communicated the virtue of securing eternal happiness to those who carry them about their persons. In bestowing upon you one of these images, we render you an immense ‹service›. You must render us, then, certain ‹services› in return.” Here you have a ‹Value› created. It is founded on a false appreciation, you say, and that is true. We might say as much of many material things [p150] which possess a certain value, for they would find purchasers if set up to auction. Economic science would become impossible if we admitted as values only values correctly and judiciously appreciated. At every step we must begin a new course of the moral and physical sciences. In a state of isolation, depraved desires and a warped intelligence may cause a man to pursue with great effort and exertion a chimerical satisfaction—a delusion. In like manner, in the social state, it sometimes happens, as the philosopher says, that we buy regret too dear. But if truth is naturally more in keeping with the human mind than error, all these frauds are destined to disappear—all these delusive services to be spurned and lose their ‹value›. Civilisation will, in the long-run, put everybody and everything in the right place.

But we must conclude this analysis, which has already extended to too great a length. Among the various wants of our nature, respiration, hunger, thirst—and the wants and desires which take their rise in our vanity, in our heads, hearts, and opinions, in our hopes for the future, whether well or ill grounded—everywhere we have sought for Value—and we have found it wherever an ‹exchange of service› takes place. We have found it everywhere of the same nature, based upon a principle clear, simple, absolute, although influenced by a multitude of varying circumstances. We might have passed in review all our other wants; we might have cited the carpenter, the mason, the manufacturer, the tailor, the physician, the officer of justice, the lawyer, the merchant, the painter, the judge, the president of the republic, and we should have found exactly the same thing. Frequently a material substance; sometimes forces furnished ‹gratuitously› by nature; always human services interchanged, measuring each other, estimating, appreciating, ‹valuing› one another, and exhibiting simply the result of that Valuation—or «Value».

There is, however, one of our wants, very special in its nature, the cement of society, at once the cause and the effect of all our transactions, and the everlasting problem of Political Economy, of which it is necessary to say something in this place—I allude to the want of ‹Exchanging›.

In the preceding chapter we have described the marvellous effects of Exchange. They are such that men must naturally feel a desire to facilitate it, even at the expense of considerable sacrifices. It is for this end that we have roads, canals, railways, carriages, ships, merchants, tradesmen, bankers; and it is impossible to believe that society would submit to such enormous draughts upon its forces for the purpose of facilitating [p151] exchange, if it did not find in exchange itself an ample compensation.

We have also seen that direct ‹barter› could give rise only to transactions at once inconvenient and restrained.

It is on that account that men have thought of resolving barter into two factors, ‹sale› and ‹purchase›, by means of an intermediate commodity, readily divisible, and, above all, possessed of ‹value›, in order to secure public confidence. This intermediate commodity is Money.

And it is worthy of remark that what, by an ellipsis or metonymy, we designate the value of gold and silver rests on exactly the same foundation as that of the air, the water, the diamond, the sermons of our old missionary, or the roulades of Malibran—that is to say, upon services rendered and received.

The gold, indeed, which we find spread on the favoured banks of the Sacramento, derives from nature many precious qualities—ductility, weight, beauty, brilliancy, utility even, if you will. But there is one quality which nature has not given it, because nature has nothing to do with that—‹Value›. A man knows that gold supplies a want which is sensibly felt, and that it is much coveted. He goes to California to seek for gold, just as my neighbour went to the spring to fetch water. He devotes himself to hard work—he digs, he excavates, he washes, he melts down—and then he comes to me and says: I will render you the service of transferring to you this gold; what service will you render me in return? We discuss the matter, we weigh all the circumstances which should influence our determination;—at last we conclude a bargain, and Value is manifested and fixed. Misled by this curt form of expression, “Gold is ‹valuable›,” we might suppose that the value resides in the gold, just as the qualities of ductility and specific gravity reside in it, and that nature has put it there. I hope the reader is already satisfied that this is a mistake. By-and-by he will be convinced that it is a deplorable fallacy.

Another misconception exists on the subject of gold, or rather of money. As it is the constant medium which enters into all transactions, the mean term between the two factors of ‹compound barter›, it is always with its value that we compare the value of the two services to be exchanged; and hence we are led to regard gold or money as a ‹measure› of value. In practice it cannot be otherwise. But science ought never to forget that money, so far as its value is concerned, is subject to the same fluctuations as any other product or service. Science does forget this sometimes; nor is it surprising. Everything tends to make us consider money [p152] as the measure of value, in the same way as the ‹litre› (or quart) is the measure of capacity. It plays an analogous part in actual business. One is not aware of its own fluctuations, because the franc, like its multiples and sub-multiples, always retains the same denomination. And arithmetic itself tends to propagate the confusion by ranking the franc as a measure, along with the measures of quantity in daily use.

I have given a definition of Value, at least of value according to my idea of it. I have subjected that definition to the test of divers facts. None of them, so far as I can see, contradict it; and the scientific signification which I have given to the word agrees with its vulgar acceptation, which is no small advantage, no slight guarantee—for what is science but experience classified? What is theory but the methodical exposition of universal practice?

I may now be permitted to glance rapidly at the systems which have hitherto prevailed. It is not in a spirit of controversy, much less of criticism, that I enter upon this examination, and I should willingly avoid it were I not convinced that it will throw new light upon the fundamental principles which I am advocating.

We have seen that writers on Political Economy have sought for the principle of Value in one or more of the accidents which exercise a notable influence over it, such as materiality, conservability, utility, rarity, labour, etc.; just like a physiologist who should seek the principle of life in one or more of the external phenomena which are necessary to its development, as air, water, light, electricity, etc.

‹Materiality.›—“Man,” says M. de Bonald, “is mind served by organs.” If the economists of the materialist school had simply meant that men can render reciprocal services to each other only through the medium of their bodily organs, and had thence concluded that there is always something material in these services, and, consequently, in Value, I should not have proceeded a step farther, as I have a horror at word-catching and subtilties, which wit revels in.

But they have not thus understood it. What they believe is that Value has been communicated to matter, either by the labour of man or by the action of nature. In a word, deceived by the elliptical form of expression, gold ‹is worth› so much, corn ‹is worth› so much, they think they see in matter a quality called ‹Value›, just as the natural philosopher sees in it resistance and weight—and yet these attributes have been disputed.

Be that as it may, I dispute formally the existence of Value as an attribute of matter. [p153]

And first of all, it cannot be denied that Matter and Value are often found separated. When we say to a man—Carry that letter to its destination—fetch me some water—teach me this science or that manufacturing process—give me advice as to my sickness, or my law-suit—watch over my security, while I give myself up to labour or to sleep,—what we demand is a Service, and in that service we acknowledge in the face of the world that there resides a ‹Value›, seeing that we pay for it voluntarily by an ‹equivalent› service. It would be strange that we should refuse to admit in theory what universal consent admits in practice.

True, our transactions have reference frequently to material objects; but what does that prove? Why, that men, by exercising foresight, prepare to render services which they know to be in demand. I purchase a coat ready made, or I have a tailor to come to my house to work by the day; but does that change the principle of Value, so as to make it reside at one time in the coat and at another time in the service?

One might ask here this puzzling question—Must we not see the principle of Value first of all in the material object, and then attribute it by analogy to the services? I say that it is just the reverse. We must recognise it first of all in the services, and attribute it afterwards, if we choose, by a figure of speech, by metonymy, to the material objects.

The numerous examples which I have adduced render it unnecessary for me to pursue this discussion further. But I cannot refrain from justifying myself for having entered on it, by showing to what fatal consequences an error, or, if you will, an incomplete truth, may lead, when placed at the threshold of a science.

The least inconvenience of the definition which I am combating has been to curtail and mutilate Political Economy. If Value resides in matter, then where there is no matter there can be no Value. The ‹Physiocrates›[31] designated three-fourths of the entire population as ‹sterile›, and Adam Smith, softening the expression, as ‹unproductive› classes.

But as facts in the long run are stronger than definitions, it became necessary in some way to bring back these classes, and make them re-enter the circle of economic studies. They were introduced by way of analogy; but the language of the science, formed beforehand on other definitions, had been so materialized as to render this extension repulsive. What mean such phrases as these: “To consume an immaterial product? Man is accumulated capital? Security is a commodity?” etc., etc. [p154]

Not only was the language of the science materialized beyond measure, but writers were forced to surcharge it with subtile distinctions, in order to reconcile ideas which had been erroneously separated. Hence Adam Smith’s expression of ‹Value in use›, in contradistinction to ‹Value in exchange›, etc.

A greater evil still has been that, in consequence of this confusion of two great social phenomena, ‹property› and ‹community›, the one has seemed incapable of justification, and the other has been lost sight of.

In fact, if Value resides in matter, it becomes mixed up with the physical qualities of bodies which render them useful to man. Now, these qualities are frequently placed there by nature. Then nature co-operates in creating ‹Value›, and we find ourselves attributing value to what is essentially ‹common› and ‹gratuitous›. On what basis, then, do you place ‹property›? When the remuneration which I give in order to obtain a material product, corn for example, is distributed among all the labourers, near or at a distance, who have rendered me a ‹service› in the production of that commodity,—who is to receive that portion of the ‹value› which corresponds to the action of nature, and with which man has nothing to do? Is it Providence who is to receive it? No one will say so, for we never heard of Nature demanding wages. Is man to receive it? What title has he to it, seeing that, by the hypothesis, he has done nothing?

Do not suppose that I am exaggerating, and that, for the sake of my own definition, I am torturing the definition of the economists, and deducing from it too rigorous conclusions. No, these consequences they have themselves very explicitly deduced, under the pressure of logic.

Thus, Senior has said that “those who have appropriated natural agents receive, under the form of rent, a recompense without having made any sacrifice. They merely hold out their hands to receive the offerings of the rest of the community.” Scrope tells us that “landed property is an artificial restriction imposed upon the enjoyment of those gifts which the Creator has intended for the satisfaction of the wants of all.” J. B. Say has these words: “Arable lands ‹would seem› to form a portion of natural wealth, seeing that they are not of human creation, and that nature has given them to man ‹gratuitously›. But as this description of wealth is not fugitive, like air and water,—as a field is a space fixed and marked out which ‹certain› men have succeeded in appropriating, to the exclusion of all others who have given their consent to this appropriation, land, which was natural [p155] and ‹gratuitous› property, has now ‹become› social wealth, the use of which must be paid for.”

Truly, if it be so, Proudhon is justified in proposing this terrible question, followed by an affirmation still more terrible:—

“To whom belongs the rent of land? To the producer of land, without doubt. Who made the land? God. Then, proprietor, begone!”

Yes, by a vicious definition, Political Economy has handed over logic to the Communists. I will break this terrible weapon in their hands, or rather they shall surrender it to me cheerfully. The consequences will disappear when I have annihilated the principle. And I undertake to demonstrate that if, in the production of wealth, the action of nature is combined with the action of man, the first—gratuitous and common in its own nature—remains gratuitous and common in all our transactions; that the second alone represents ‹services›, ‹value›; that the action of man alone is remunerated; and that it alone is the foundation, explanation, and justification of Property. In a word, I maintain that, relatively to each other, men are proprietors only of the value of things, and that in transferring products from hand to hand, what they stipulate for exclusively is value, that is to say, reciprocal services:—all the qualities, properties, and utilities, which these products derive from nature being obtained by them into the bargain.

If Political Economy hitherto, in disregarding this fundamental consideration, has shaken the guardian principle of property, by representing it as an artificial institution, necessary, indeed, but unjust, she has by the same act left in the shade, and completely unperceived, another admirable phenomenon the most touching dispensation of Providence to the creature—the phenomenon of ‹progressive community›.

Wealth, taking the word in its general acceptation, results from the combination of two agencies—the action of nature, and the action of man. The first is ‹gratuitous› and ‹common› by the destination of Providence, and never loses that character. The second alone is ‹provided with value›, and, consequently, ‹appropriated›. But with the development of intelligence, and the progress of civilisation, the one takes a greater and greater part, the other a less and less part, in the realization of each given utility; whence it follows that the domain of the Gratuitous and the Common is continually expanding among men relatively to the domain of Value and Property; a consoling and suggestive view of the subject, entirely hidden from the eye of science, so long as we continue to attribute Value to the co-operation of nature. [p156]

Men of all religions thank God for His benefits. The father of a family blesses the bread which he breaks and distributes to his children—a touching custom, that reason would not justify were the liberality of Providence other than gratuitous.

‹Durableness›, ‹conservability›—that pretended ‹sine quâ non› of Value, is connected with the subject which I have just been discussing. It is necessary to the very existence of value, as Adam Smith thinks, that it should be fixed and realized in something which can be exchanged, accumulated, preserved, consequently in something ‹material›.

“There is one sort of labour which adds[32] to the value of the subject upon which it is bestowed. There is another which has no such effect.”

“The labour of the manufacturer,” he adds, “fixes and realizes itself in some particular subject or vendible commodity, ‹which lasts for some time at least› after the labour is past. The labour of the menial servant, on the contrary” (to which the author assimilates in this respect that of soldiers, magistrates, musicians, professors, etc.), “does not fix or realize itself in any particular subject or vendible commodity. His services perish in the very instant of their performance, and leave no trace of ‹value› behind them.”

Here we find ‹Value› connected rather with the modifications of matter than with the satisfactions of men—a profound error; for the sole good to be obtained from the modification of material things is the attainment of that satisfaction which is the design, the end, the ‹consommation›[33] of every Effort. If, then, we realize that satisfaction by a direct and immediate effort, the result is the same; and if that effort can be made the subject of transactions, exchanges, ‹estimation›, it includes the principle of ‹Value›.

As regards the interval which may elapse between the effort and the satisfaction, surely Adam Smith attributes far too much importance to it, when he says that the existence or non-existence of Value depends upon it. “The value of a vendible commodity,” he says, “‹lasts for some time at least›.” Undoubtedly it lasts until the commodity has answered its purpose, which is to satisfy a want; and exactly the same thing may be said of a service. As long as that plate of strawberries remains on the sideboard it preserves its ‹value›. Why? Because it is the result of a service [p157] which I have designed to render to myself, or that another has rendered to me by way of compensation, and ‹of which I have not yet made use›. The moment I have made use of it, by eating the strawberries, the value will disappear. ‹The service will vanish and have no trace of value behind.› The very same thing holds of personal services. The consumer makes the value disappear, for it has been created only for that purpose. It is of little consequence, as regards the principle of value, whether the service is undertaken to satisfy a want to-day, to-morrow, or a year hence.

Take another case. I am afflicted with a cataract. I call in an oculist. The instrument he makes use of has ‹value›, because it has durability; the operation he performs, it is said, has none, and yet I pay for it, and I have made choice of one among many rival operators, and arranged his remuneration beforehand. To maintain that this service has no value is to run counter to notorious facts and notions universally received. And of what use, I would ask, is a theory which, far from taking universal practice into account, ignores it altogether?

I would not have the reader suppose that I am carried away by an inordinate love of controversy. If I dwell upon these elementary notions, it is to prepare his mind for consequences of the highest importance, which will be afterwards developed. I know not whether it be to violate the laws of method to indicate these consequences by anticipation, but I venture to depart slightly from the regular course, in order to obviate the danger of becoming tedious. This is the reason why I have spoken prematurely of Property and Community; and for the same reason I shall here say a word respecting ‹Capital›.

As Adam Smith made value to reside in matter, he could not conceive Capital as existing otherwise than in an accumulation of material objects. How, then, can we attribute Value to Services not susceptible of being accumulated or converted into capital?

Among the different descriptions of Capital, we give the first place to tools, machines, instruments of labour. They serve to make natural forces co-operate in the work of production, and, attributing to these forces the faculty of creating value, people were led to imagine that instruments of labour, as such, were endowed with the same faculty, independently of any human services. Thus the spade, the plough, the steam-engine, were supposed to co-operate simultaneously with natural agents and human forces in creating not only Utility, but Value also. But all value is remunerated by exchange. Who, then, is to receive that portion of value which is independent of all human service? [p158]

It is thus that the school of Proudhon, after having brought the ‹rent of land› into question, has contested also the ‹interest of capital›—a larger thesis, because it includes the other. I maintain that the Proudhonian error, viewed scientifically, has its root in the prior error of Adam Smith. I shall demonstrate that capital, like natural agents, considered in itself, and with reference to its own proper action, creates utility, but never creates value. The latter is essentially the fruit of a legitimate ‹service›. I shall demonstrate also that, in the social order, capital is not an accumulation of material objects, depending on material durability, but an accumulation of ‹Values›, that is to say, of ‹services›. This will put an end (virtually at least, by removing its foundation) to the recent attack upon the productiveness of capital, and in a way satisfactory to the objectors themselves; for if I prove that there is nothing in the business of exchange but a ‹mutuality of services›, M. Proudhon must own himself vanquished by my victory over his principle.

‹Labour.›—Adam Smith and his disciples have assigned the principle of Value to Labour under the condition of Materiality. This is contrary to the other opinion that natural forces play a certain part in the production of Value. I have not here to combat the contradictions which become apparent in all their fatal consequences when these authors come to discuss the rent of land and the interest of capital.

Be that as it may, when they refer the principle of Value to Labour, they would be very near the truth if they did not allude to manual labour. I have said, in fact, at the beginning of this chapter, that Value must have reference to ‹Effort›,—an expression which I prefer to the word Labour, as more general, and embracing the whole sphere of human activity. But I hasten to add that it can spring only from efforts exchanged—from reciprocal Services; because value is not a thing having independent existence, but a relation.

There are then, strictly speaking, two flaws in Adam Smith’s definition. The first is, that it does not take exchange into account, without which value can be neither produced nor conceived. The second is, that it makes use of too restricted a term—‹labour›; unless we give to that term an unusual extension, and include in it the ideas not only of intensity and duration, but of skill, sagacity, and even of good or bad fortune.

The word ‹service›, which I substitute in my definition, removes these defects. It implies, necessarily, the idea of transmission, for no service can be rendered which is not received; and it implies [p159] also the idea of Effort, without taking for granted that the value is proportionate.

It is in this, above all, that the definition of the English Economists is vicious. To say that Value resides in Labour induces us to suppose that Value and Labour are proportional, and serve as reciprocal measures of each other. This is contrary to fact, and a definition which is contrary to fact must be defective.

It often happens that an exertion, considered insignificant in itself, passes with the world as of enormous ‹value›. (Take, for example, the diamond, the performance of the prima donna, a dash of a banker’s pen, a fortunate privateering adventure, a touch of Raphael’s pencil, a bull of plenary indulgence, the easy duty of an English queen, etc.) It still more frequently happens that laborious and overwhelming labour tends to what is absolutely ‹valueless›; and if it be so, how can we establish co-relation and proportion between ‹Value› and ‹Labour›?

My definition removes the difficulty. It is clear that in certain circumstances one can render a great service at the expense of a very small exertion, and that in others, after great exertion, we render no service at all. And this is another reason why, in this respect, it is correct to say that the Value is in the Service rendered, rather than in the Labour bestowed, seeing that it bears proportion to the one and not to the other.

I go further. I affirm that value is estimated as much by the labour saved to the recipient as by the labour performed by the ‹cédant› [the man who cedes or makes it over]. Let the reader recall the dialogue which we supposed to take place between the two parties who bargained for the diamond. In substance, it has reference to no accidental circumstances, but enters, tacitly, into the essence and foundation of all transactions. Keep in mind that we here take for granted that the two parties are at entire liberty to exercise their own will and judgment. Each of them, in making the exchange, is determined by various considerations, among which we must certainly rank, as of the greatest importance, the difficulty experienced by the recipient in procuring for himself, by a direct exertion, the satisfaction which is offered to him. Both parties have their eyes on that difficulty, the one with the view of being more yielding, the other with the view of being more exacting. The labour undergone by the ‹cédant› also exerts an influence on the bargain. It is one of the elements of it, but it is not the only one. It is not, then, exact to say that value is determined by labour. It is determined by a multitude of considerations, all comprised in the word ‹service›. [p160]

What may be affirmed with great truth is this; that, in consequence of competition, Value ‹tends› to become more proportioned to Effort—recompense to merit. It is one of the beautiful Harmonies of the social state. But, as regards Value, this equalizing pressure exercised by competition is quite external, and it is not allowable in strict logic to confound the influence which a phenomenon undergoes, from an external cause, with the phenomenon itself.[34]

‹Utility.›—J. B. Say, if I am not mistaken, was the first who threw off the yoke of ‹materiality›. He made out value very expressly [p161] to be a ‹moral quality›,—an expression which perhaps goes too far, for value can scarcely be said to be either a physical or a moral quality—it is simply a relation.

But the great French Economist has himself said, that “It is not given to any one to reach the confines of science, and Philosophers mount on each other’s shoulders to explore a more and more extended horizon.” Perhaps the glory of M. Say (in what regards the special question with which we are now occupied, for his titles to glory in other respects are as numerous as they are imperishable) is to have bequeathed to his successors a view of the subject which is prolific and suggestive.

M. Say’s principle was this—“‹Value is founded on Utility.›”

If we had here to do with utility as connected with human ‹services›, I should not contest this principle. At most I could only observe that it is superfluous, as being self-evident. It is very clear, as matter of fact, that no one consents to remunerate a ‹service›, unless right or wrong, he judges it to be useful. The word service includes the idea of ‹utility›—so much so that it is nothing else than a literal reproduction of the Latin word ‹uti›; in French, ‹servir›.

But, unfortunately, it is not in this sense that Say understands it. He discovers the principle of value not only in human services, rendered by means of material things, but in the ‹useful› qualities put by nature into the things themselves. In this way he places himself once more under the yoke of materiality, and is very far, we are obliged to confess, from clearing away the mist in which the English Economists had enveloped the question of Property.

Before discussing Say’s principle on its own merits, I must explain its logical bearing, in order to avoid the reproach of landing myself and the reader in an idle discussion.

We cannot doubt that the Utility of which Say speaks is that which resides in material objects. If corn, timber, coal, broad cloth, have value, it is because these products possess qualities which render them proper for our use, fit to satisfy the want we experience of food, fuel, and clothing.

Hence, as nature has created Utility, it is inferred that she has created also Value—a fatal confusion of ideas, out of which the enemies of property have forged a terrible weapon.

Take a commodity, corn for example. I purchase it at the ‹Halle au Blé› for sixteen francs. A great portion of these sixteen francs is distributed—in infinite ramifications, and an inextricable complication of advances and reimbursements—among all the men, [p162] here or abroad, who have co-operated in furnishing this corn. Part goes to the labourer, the sower, the reaper, the thrasher, the carter,—part to the blacksmith and plough-wright, who have prepared the agricultural implements. Thus far all are agreed, whether Economists or Communists.

But I perceive that four out of the sixteen francs go to the proprietor of the soil, and I have a good right to ask if that man, like the others, has rendered me a Service to entitle him incontestably, like them, to remuneration.

According to the doctrine which the present work aspires to establish, the answer is categorical. It consists of a peremptory ‹yes›. The proprietor ‹has› rendered me a service. What is it? This, that he has by himself, or his ancestor, cleared and enclosed the field—he has cleared it of weeds and stagnant water—he has enriched and thickened the vegetable mould—he has built a house and a homestead. All this presupposes much labour executed by him in person; or, what comes to the same thing, by others whom he has paid. These are services, certainly, which, according to the just law of reciprocity, must be reimbursed to him. Now, this proprietor has never been remunerated, at least to the full extent. He cannot be so by the first man who comes to buy from him a bag of corn. What is the arrangement, then, that takes place? Assuredly the most ingenious, the most legitimate, the most equitable arrangement which it is possible to imagine. It consists in this—That whoever wishes to purchase a sack of corn shall pay, besides the services of the various labourers whom we have enumerated, a small portion of the ‹services› rendered by the proprietor. In other words, the ‹Value› of the proprietor’s ‹services› is spread over all the sacks of corn which are produced by this field.

Now, it may be asked if the supposed remuneration of four francs be too great or too small. I answer that Political Economy has nothing to do with that. That science establishes that the value of the services rendered by the landed proprietor are regulated by exactly the same laws as the value of other services, and that is enough.

It may be a subject of surprise, too, that this bit-by-bit reimbursement should not at length amount to a complete liquidation, and, consequently, to an extinction of the proprietor’s claim. They who make this objection do not reflect that it is of the nature of Capital to produce a perpetual return, as we shall see in the sequel.

I shall not dwell longer on that question in this place; and shall [p163] simply remark, that there is not in the entire price of the corn a single farthing which does not go to remunerate human services,—not one which corresponds to the ‹value› that nature is supposed to have given to the corn by imparting to it ‹utility›.

But if, adhering to the principle of Say and the English Economists, you assert that, of the sixteen francs, there are twelve which go to the labourers, sowers, reapers, carters, etc.—two which recompense the personal services of the proprietor; and finally, that there are two others which represent a value which has for its foundation the ‹utility› created by God, by natural agents, and without any co-operation of man, do you not perceive that you immediately lay yourself open to be asked, Who is to profit by this portion of ‹value›? Who has a title to this remuneration? Nature does not demand it, and who dare take nature’s place.

The more Say tries to explain Property on this hypothesis, the more he exposes himself to attack. He sets out by justly comparing nature to a laboratory, in which various chemical operations take place, the result of which is useful to man. “The soil, then,” he adds, “is the ‹producer of utility›, and when «IT» (the soil) receives payment in the form of a profit or a rent ‹to its proprietor›, it is not without giving something to the consumer in exchange for what he pays «IT» (the soil). «It» (still the soil) gives him the utility it has produced, and it is in producing this utility that ‹the earth is productive as well as labour›.”

This assertion is unmistakable. Here we have two pretenders, who present themselves to share the remuneration due by the consumer of corn—namely, the earth and labour. They urge the same title, for the soil, M. Say affirms, is productive as well as labour. Labour asks to be remunerated for a ‹service›; the soil demands to be remunerated for a ‹utility›, and this remuneration it demands not for itself (for in what form should we give it?) but for ‹its proprietor›.

Whereupon Proudhon summons the proprietor, who represents himself as having the powers of the soil at his disposal, to exhibit his title.

You wish me to pay; in other words, to render a service, in order that I may receive the ‹utility› produced by natural agents, independently of the assistance of man, already paid for separately.

But, I ask again, Who is to profit by my service?

Is it the producer of utility,—that is to say, the soil? That is absurd—the fear of any demand from that quarter need give no great uneasiness. [p164]

Is it man? but by what title does he demand it? If for having rendered me a service, well and good. In that case, we are at one. It is the human service which ‹has value›, not the natural service; and that is just the conclusion to which I desire to bring you.

That, however, is contrary to your hypothesis. You say that all the human services are remunerated with fourteen francs, and that the two francs which make up the price of the corn correspond to the value created by nature. In that case, I repeat my question—By what title does any one present himself to receive them? Is it not, unfortunately, too clear that if you give specially the name of ‹proprietor› to the man who claims right to these two francs, you justify the too famous saying that ‹Property is theft›?

And don’t imagine that this confusion between utility and value shakes only the foundation of landed property. After having led you to contest the ‹rent of land›, it leads you to contest also the ‹interest of capital›.

In fact, machines, the instruments of labour, are, like the soil, producers of ‹utility›. If that utility has ‹value›, it is paid for, for the word value implies right to payment. But to whom is the payment made? To the proprietor of the machine, without doubt. Is it for a personal service? Then say at once that the value is in the service. But if you say that it is necessary to make a payment first for the service, and a second payment for the utility produced by the machine independently of the human action, which has been already recompensed, then I ask you to whom does this second payment go, and how has the man who has been already remunerated for all his services a right to demand anything more?

The truth is, that the utility which is produced by nature is ‹gratuitous›, and therefore ‹common›, like that produced by the instruments of labour. It is gratuitous and common on one condition, that we take the trouble, that we render ourselves the service of appropriating it; or, if we give that trouble to or demand that service from another, that we cede to him in return an ‹equivalent› service. It is in these services, thus compared, that value resides, and not at all in natural utility. The exertion may be more or less great—that makes a difference in the value, not in the utility. When we stand near a spring, water is gratuitous for us all on condition that we stoop to lift it. If we ask our neighbour to take that trouble for us, then a convention, a bargain, a ‹value› makes its appearance, but that does not make the water otherwise than gratuitous. If we are an hour’s walk from the spring, the basis of the transaction will be different; but the difference is one of degree, not of principle. The value has not, on that account, passed into [p165] the water or into its utility. The water continues still ‹gratuitous› on condition of fetching it, or of remunerating those who, by a bargain freely made and discussed, agree to spare us that exertion by making it themselves.

It is the same thing in every case. We are surrounded by utilities, but we must ‹stoop to appropriate them›. That exertion is sometimes very simple, and often very complicated. Nothing is more easy, in the general case, than to draw water, the utility of which has been prepared by nature beforehand. It is not so easy to obtain corn, the utility of which nature has equally prepared. This is why these two efforts differ in degree though not in principle. The service is more or less onerous; therefore more or less ‹valuable›—the utility is, and remains always, ‹gratuitous›.

Suppose an instrument of labour to intervene, what would be the result? That the utility would be more easily obtained. The service has thus less ‹value›. We certainly pay less for our books since the invention of printing. Admirable phenomenon, too little understood! You say that the instruments of labour produce Value—you are mistaken—it is Utility, and gratuitous Utility, you should say. As to Value, instead of producing it, they tend more and more to annihilate it.

It is quite true that the person who made the machine has rendered a service. He receives a remuneration by which the value of the product is augmented. This is the reason why we fancy we recompense the utility which the machine produces. It is an illusion. What we remunerate is the ‹services› which all those who have co-operated in making and working the machine have rendered to us. So little does the value reside in the utility produced, that even after having recompensed these new ‹services›, we acquire the utility on easier and cheaper terms than before.

Let us accustom ourselves to distinguish Utility from Value. Without this there can be no Economic science. I give utterance to no paradox when I affirm that Utility and Value, so far from being identical, or oven similar, are ideas opposed to one another. Want, Effort, Satisfaction: here we have man regarded in an Economic point of view. The relation of utility is with Want and Satisfaction. The relation of Value is with Effort. Utility is the Good, which puts an end to the want by the satisfaction. Value is the Evil, for it springs from the obstacle which is interposed between the want and the satisfaction. But for these obstacles, there would have been no Effort either to make or in exchange; Utility would be infinite, gratuitous, and common, ‹without condition›, and the notion of Value would never have [p166] entered into the world. In consequence of these obstacles, Utility is gratuitous only on condition of Efforts exchanged, which, when compared with each other, give rise to Value. The more these obstacles give way before the liberality of nature and the progress of science, the more does utility approximate to the state of being absolutely common and gratuitous, for the onerous condition, and, consequently, the ‹value›, diminish as the obstacles diminish. I shall esteem myself fortunate if, by these dissertations, which may appear subtle, and of which I am condemned to fear at once the length and the conciseness, I succeed in establishing this encouraging truth—‹the legitimate property of value›,—and this other truth, equally consoling—‹the progressive community of utility›.

One observation more. All that ‹serves› us is ‹useful› (‹uti›, ‹servir›), and in this respect it is extremely doubtful whether there be anything in the universe (whether in the shape of forces or materials) which is not ‹useful› to man.

We may affirm at least, without fear of mistake, that a multitude of things possess a utility which is unknown to us. Were the moon placed either higher or lower than she is, it is very possible that the inorganic kingdom, consequently the vegetable kingdom, consequently also the animal kingdom, might be profoundly modified. But for that star which shines in the firmament while I write, it may be that the human race had not existed. Nature has surrounded us with utilities. The quality of being ‹useful› we recognise in many substances and phenomena;—in others, science and experience reveal it to us every day,—in others, again, it may exist in perfection, and yet we may remain for ever ignorant of it.

When these substances and phenomena exert upon us, but ‹independently of us›, their useful action, we have no interest in comparing the degree of their utility to mankind; and, what is more, we have scarcely the means of making the comparison. We know that oxygen and azote are useful to us, but we don’t try, and probably we should try in vain, to determine in what proportion. We have not here the elements of appreciation—the elements of value. I should say as much of the salts, the gases, the forces which abound in nature. When all these agents are moved and combined so as to produce for us, but ‹without our co-operation›, utility, that utility we enjoy without ‹estimating› its value. It is when our co-operation comes into play, and, above all, when it comes to be exchanged,—it is then, and then only, that Estimation and Value make their appearance, in connexion not with the utility of the substances or phenomena, of which we are often ignorant, but with the co-operation itself. [p167]

This is my reason for saying that “Value is the appreciation of services exchanged.” These services may be very complicated; they may have exacted a multitude of operations recent or remote; they may be transmitted from one generation or one hemisphere to another generation or another hemisphere, embracing countless contracting parties, necessitating credits, advances, various arrangements, until a general balance is effected. But the principle of ‹value› is always in the services, and not in the utility of which these services are the vehicle,—utility which is gratuitous in its nature and essence, and which passes from hand to hand, if I may be allowed the expression, ‹into the bargain›.

After all, if you persist in seeing in Utility the foundation of Value, I am very willing, but it must be distinctly understood that it is not that utility which is in things and phenomena by the dispensation of Providence or the power of art, but the utility of human services compared and exchanged.

‹Rarity.›—According to Senior, of all the circumstances which determine value, rarity is the most decisive. I have no objection to make to that remark, if it is not that the form in which it is made presupposes that value is inherent in things themselves—a hypothesis the very appearance of which I shall always combat. At bottom, the word ‹rarity›, as applied to the subject we are now discussing, expresses in a concise manner this idea, that, ‹cæteris paribus›, a service has more value in proportion as we have more difficulty in rendering it to ourselves; and that, consequently, a larger equivalent is exacted from us when we demand it from another. Rarity is one of these difficulties. It is one ‹obstacle› more to be surmounted. The greater it is, the greater remuneration do we award to those who surmount it for us. Rarity gives rise frequently to large remunerations, and this is my reason for refusing to admit with the English Economists that Value is proportional to Labour. We must take into account the parsimony with which nature treats us in certain respects. The word ‹service› embraces all these ideas and shades of ideas.

‹Judgment.›—Storch sees ‹value› in the judgment by which we recognise it. Undoubtedly, whenever we have to do with ‹relation›, it is necessary to compare and to ‹judge›. Nevertheless, the relation is one thing and the judgment is another. When we compare the height of two trees, their magnitude, and the difference of their magnitude, are independent of our appreciation.

But in the determination of value, what is the relation of which we have to form a judgment? It is the relation of two services exchanged. The business is to discover what the services rendered [p168] ‹are worth› in relation to those received, in connexion with acts or things exchanged, and taking all circumstances into account,—not what intrinsic utility resides in these acts or things, for this utility may, to some extent, be altogether independent of human exertion, and, consequently, devoid of ‹value›.

Storch falls into the error which I am now combating when he says,—

“Our judgment enables us to discover the relation which exists between our wants and the utility of things. The determination which our judgment forms upon the ‹utility of things› constitutes their ‹value›.”

And, farther on, he says,—

“In order to create a value, we must have the conjunction of these three circumstances:—‹1st›, That man experiences or conceives a want; ‹2d›, That there exists something calculated to satisfy that want; and, ‹3d›, That a judgment is pronounced in favour of the ‹utility of the thing›. Then the value of things is their relative ‹utility›.”

During the day I experience the want of seeing clearly. There exists one thing calculated to satisfy that want—namely, the light of the sun. My judgment pronounces in favour of the utility of that thing, and . . . it has no value. Why? Because I enjoy it without calling for the services of any one.

At night I experience the same want. There exists one thing capable of satisfying it very imperfectly, a wax candle. My judgment pronounces in favour of the utility, but far inferior utility, of that thing—and it ‹has value›. Why? Because the man who has taken the trouble to make the candle will not give it to me except upon condition of my rendering him an equivalent service.

What we have, then, to compare and to judge of, in order to determine Value, is not the ‹relative utility› of things, but the relation of two services.

On these terms, I do not reject Storch’s definition.

Permit me to recapitulate a little, in order to show clearly that my definition contains all that is true in the definitions of my predecessors, and eliminates everything in them which is erroneous either through excess or defect.

The principle of Value, we have seen, resides in a human ‹service›, and results from the appreciation of two services compared.

Value must have relation to Effort. ‹Service› implies a certain Effort.

Value supposes a comparison of Efforts exchanged, at least exchangeable. ‹Service› implies the terms to give and to receive. [p169]

Value is not, however, in fact proportional to the intensity of the Efforts. ‹Service› does not necessarily imply that proportion.

A multitude of external circumstances influence value without constituting value itself. The word ‹service› takes all these circumstances in due measure into account.

‹Materiality.›—When the service consists in transferring a material thing, nothing hinders us from saying, by metonymy, that it is the thing which ‹has value›. But we must not forget that this is a figure of speech, by which we attribute to things themselves the value of the services which produced them.

‹Conservability.›—Without reference to the consideration of materiality, value endures until the satisfaction is obtained, and no longer. Whether the satisfaction follows the effort more or less nearly—whether the service is personal or real, makes no change in the nature of value.

‹Capability of Accumulation.›—In a social point of view, what is accumulated by saving is not matter, but value or services.[35]

‹Utility.›—I admit, with M. Say, that Utility is the foundation of Value, provided it is granted me that we have no concern with the utility which resides in commodities, but with the relative utility of services.

‹Labour.›—I admit, with Ricardo, that Labour is the foundation of Value, provided, first of all, the word labour is taken in the most general sense, and that you do not afterwards assert a proportionality which is contrary to fact; in other words, provided you substitute for the word ‹labour› the word ‹service›.

‹Rarity.›—I admit, with Senior, that rarity influences ‹value›. But why? Because it renders the ‹service› so much more precious.

‹Judgment.›—I admit, with Storch, that value results from a judgment formed, provided it is granted me that the judgment so formed is not upon the utility of things, but on the utility of ‹services›.

Thus I hope to satisfy Economists of all shades of opinion. I [p170] admit them all to be right, because all have had a glimpse of the truth in one of its aspects. Error is no doubt on the reverse of the medal; and it is for the reader to decide whether my definition includes all that is true, and rejects all that is false.

I cannot conclude without saying a word on that ‹quadrature› of Political Economy—‹the measure of value›; and here I shall repeat, and with still more force, the observation with which I terminated the preceding chapters.

I said that our wants, our desires, our tastes, have neither limit nor exact measure.

I said also that our means of providing for our wants—the gifts of nature, our faculties, activity, discernment, foresight—had no precise measure. Each of these elements is variable in itself—it differs in different men—it varies from hour to hour in the same individual,—so that the whole forms an aggregate which is mobility itself.

If, again, we consider what the circumstances are which influence value—utility, labour, rarity, judgment—and reflect that there is not one of these circumstances which does not vary ‹ad infinitum›, we may well ask why men should set themselves so pertinaciously to try to discover a fixed measure of Value?

It would be singular, indeed, if we were to find fixity in a mean term composed of variable elements, and which is nothing else than a Relation between two extreme terms more variable still!

The Economists, then, who go in pursuit of an ‹absolute measure of value› are pursuing a chimera; and, what is more, a thing which, if found, would be positively useless. Universal practice has adopted gold and silver as standards, although practical men are not ignorant how variable is the value of these metals. But of what importance is the variability of the measure, if, affecting equally and in the same manner the two objects which are exchanged, it does not interfere with the fairness and equity of the exchange? It is a ‹mean proportional›, which may rise or fall, without, on that account, failing to perform its office, which is to show the ‹Relation› of two extremes.

The design of the science is not, like that of exchange, to discover the ‹present Relation of two services›, for, in that case, money would answer the purpose in view. What the science aims at discovering is ‹the Relation between Effort and Satisfaction›; and for this purpose, a measure of value, did it exist, would teach us nothing, for the effort brings always to the satisfaction a varying proportion of gratuitous utility which has no value. It is because this element of our well-being has been lost sight of that the [p171] majority of writers have deplored the absence of a measure of Value. They have not reflected that it would not enable them to answer the question proposed—What is the comparative Wealth or prosperity of two classes, of two countries, of two generations?

In order to resolve that question, the science would require a measure which should reveal to it not only ‹the relation of two services›, which might be the vehicle of very different amounts of gratuitous utility, but the relation ‹of the Effort to the Satisfaction›, and that measure could be no other than the effort itself, or labour.

But how can labour serve as a measure? Is it not itself a most variable element? Is it not more or less skilful, laborious, precarious, dangerous, repugnant? Does it not require, more or less, the intervention of certain intellectual faculties, of certain moral virtues? and, according as it is influenced by these circumstances, is it not rewarded by a remuneration which is in the highest degree variable?

There is one species of labour which, at all times, and in all places, is identically the same, and it is that which must serve as a type. I mean labour the most simple, rude, primitive, muscular,—that which is freest from all natural co-operation—that which every man can execute—that which renders services of a kind which one can render to himself—that which exacts no exceptional force or skill, and requires no apprenticeship,—industry such as is found in the very earliest stages of society: the work, in short, of the simple day-labourer. That kind of labour is everywhere the most abundantly supplied, the least special, the most homogeneous, and the worst remunerated. Wages in all other departments are proportioned and graduated on this basis, and increase with every circumstance which adds to its importance.

If, then, we wish to compare two social states with each other, we cannot have recourse to a ‹standard of value›, and for two reasons, the one as logical as the other—first, because there is none; and, secondly, because, if there were, it would give a wrong answer to our question, neglecting, as it must, a considerable and progressive element in human prosperity—gratuitous utility.

What we must do, on the contrary, is to put Value altogether out of sight, particularly the consideration of money; and ask the question, What, in such and such a country, and, at such and such an epoch, is the amount of each kind of special utility, and the sum total of all utilities, which correspond to a given amount of unskilled labour? In other words, what amount of material comfort and prosperity can an unskilled workman earn as the reward of his daily toil? [p172]

We may affirm that the natural social order is harmonious, and goes on improving, if, on the one hand, the number of unskilled labours, receiving the smallest possible remuneration, continues to diminish; and if, on the other, that remuneration, measured not in value or in money, but in real satisfactions, continues constantly on the increase.[36]

The ancients have well described all the combinations of Exchange:—

‹Do ut des› (commodity against commodity), ‹Do ut facias› (commodity against service), ‹Facio ut des› (service against commodity), ‹Facio ut facias› (service against service).[37]

Seeing that products and services are thus exchanged for one another, it is quite necessary that they should have something in common, something by which they can be compared and estimated—namely, ‹Value›.

But value is always identically the same. Whether it be in the product or in the service, it has always the same origin and foundation.

This being so, we may ask, is Value originally and essentially in the ‹commodity›, and is it only by analogy that we extend the notion to the ‹service›?

Or, on the contrary, does Value reside in the service, and is it not mixed up and amalgamated with the product, simply and exclusively because the service is so?

Some people seem to think that this is a question of pure subtilty. We shall see by-and-by. At present I shall only observe, that it would be strange if, in Political Economy, a good or a bad definition of Value were a matter of indifference.

I cannot doubt that, at the outset, Political Economists thought they discovered value rather in the product, as such, than in the matter of the product. The Physiocrates [the ‹Économistes› of Quesnay’s school] attributed value exclusively to land, and stigmatized as ‹sterile› such classes as added nothing to matter,—so strictly in their eyes were ‹value› and ‹matter› bound up together.

Adam Smith ought to have discarded this idea, since he makes ‹value› flow from ‹labour›. Do not pure services, services ‹per se›, exact labour, and, consequently, do they not imply value? Near to the truth as Smith had come, he did not make himself master of it; for, besides pronouncing formally that labour, in order to possess value, must be applied to matter, to something physically [p173] tangible and capable of accumulation, we know that, like the Physiocrates, he ranked those who simply render services among the unproductive classes.

These classes, in fact, occupy a prominent position in the Wealth of Nations. But this only shows us that the author, after having given a definition, found himself straitened by it, and, consequently, that that definition is erroneous. Adam Smith would not have gained his great and just renown had he not written his magnificent chapters on Education, on the Clergy, and on Public Services, and if he had, in treating of Wealth, confined himself within the limits of his own definition. Happily, by this inconsistency, he freed himself from the fetters which his premises imposed upon him. This always happens. A man of genius who sets out with a false principle never escapes inconsistency, without which he would get deeper and deeper into error, and, far from appearing a man of genius, would show himself no longer a man of sense.

As Adam Smith advanced a step beyond the Physiocrates, Jean Baptiste Say advanced a step beyond Smith. By degrees Say was led to refer value to services, but only by way of analogy. It is in the product that he discovers true value, and nothing shows this better than his whimsical denomination of services as “immaterial products”—two words which absolutely shriek out on finding themselves side by side. Say, in the outset, agrees with Smith; for the entire theory of the master is to be found in the first ten lines of the work of the disciple.[38] But he thought and meditated on the subject for thirty years, and he made progress. He approximated more and more to the truth, without ever fully attaining it.

Moreover, we might have imagined that Say did his duty as an Economist as well by referring the value of the service to the product, as by referring the value of the product to the service, if the Socialist propaganda, founding on his own deductions, had not come to reveal to us the insufficiency and the danger of his principle.

The question I propose, then, is this:—Seeing that certain products are possessed of value, seeing that certain services are possessed of value, and seeing that value is one and identical, and can have but one origin, one foundation, one explanation,—is this origin, this explanation to be found in the product or in the service?

The reply to that question is obvious, and for this unanswerable [p174] reason, that every product which has value implies service, but every service does not necessarily imply a product.

This appears to me mathematically certain—conclusive.

A service, as such, has value, whether it assume a material form or not.

A material object has value if, in transferring it to another, we render him a service,—if not, it has no value.

Then value does not proceed from the material object to the service, but from the service to the material object.

Nor is this all. Nothing is more easily explained than this pre-eminence, this priority, given to the service over the product, so far as value is concerned. We shall immediately see that this is owing to a circumstance which might have been easily perceived, but which has not been observed, just because it is under our eyes. It is nothing else than that foresight which is natural to man, and in virtue of which, in place of limiting himself to the services which are demanded of him, he prepares himself beforehand to render those services which he foresees are likely to be demanded. It is thus that the ‹facio ut facias› transforms itself into the ‹do ut des›, without its ceasing to be the dominant fact which explains the whole transaction.

John says to Peter, I want a cup. I could make it for myself, but if you will make it for me, you will render me a service, for which I will pay you by an equivalent service.

Peter accepts the offer, and, in consequence, sets out in quest of suitable materials, mixes them, manipulates them, and, in fine, makes the article which John wants.

It is very evident that here it is the service which determines the value. The dominant word in the transaction is ‹facio›. And if, afterwards, the value is incorporated with the product, it is only because it flows from the service, which combines the labour executed by Peter with the labour saved to John.

Now, it may happen that John may make frequently the same proposal to Peter, and that other people may also make it; so that Peter can foresee with certainty the kind of services which will be demanded of him, and prepare himself for rendering them. He may say, I have acquired a certain degree of skill in making cups. Experience tells me that cups supply a want which must be satisfied, and I am therefore enabled to manufacture them beforehand.

Henceforth John says no longer to Peter, ‹facio ut facias›, but ‹facio ut des›. If he in turn has foreseen the wants of Peter, and laboured beforehand to provide for them, he can then say ‹do ut des›. [p175]

But in what respect, I ask, does this progress, which flows from human foresight, change the nature and origin of value? Does service cease to be its foundation and measure? As regards the true idea of value, what difference does it make whether Peter, before he makes the cup, waits till there is a demand for it, or, foreseeing a future demand, manufactures the article beforehand?

There is another remark which I would make here. In human life, inexperience and thoughtlessness precede experience and foresight. It is only in the course of time that men are enabled to foresee each other’s wants, and to make preparations for satisfying them. Logically, the ‹facio ut facias› must precede the ‹do ut des›. The latter is at once the fruit and the evidence of a certain amount of knowledge diffused, of experience acquired, of political security obtained, of a certain confidence in the future,—in a word, of a certain degree of civilisation. This social prescience, this faith in a future ‹demand›, which causes us to provide a present ‹supply›; this sort of intuitive acquaintance with statistics which each possesses in a greater or less degree, and which establishes a surprising equilibrium between our wants and the means of supplying them, is one of the most powerful and efficacious promoters of human improvement. To it we owe the division of labour, or at least the separation of trades and professions. To it we owe one of the advantages which men seek for with the greatest ardour, the fixity of remuneration, under the form of ‹wages› as regards labour, and ‹interest› as regards capital. To it we are indebted for the institution of credit, transactions having reference to the future, those which are designed to equalize risk, etc. It is surprising, in an Economical point of view, that this noble attribute of man, Foresight, has not been made more the subject of remark. This arises, as Rousseau has said, from the difficulty we experience in observing the medium in which we live and move, and which forms our natural atmosphere. We notice only exceptional appearances and abnormal facts, while we allow to pass unperceived those which act permanently around us, upon us, and within us, and which modify profoundly both individual men and society at large.

To return to the subject which at present engages us. It may be that human foresight, in its infinite diffusion, tends more and more to substitute the ‹do ut des› for the ‹facio ut facias›; but we must never forget that it is in the primitive and ‹necessary› form of exchange that the notion of value first makes its appearance, that this primitive form is that of reciprocal service; and that, after all, [p176] as regards exchange, the product is only a ‹service foreseen› and provided for.

But although I have shown that value is not inherent in matter, and cannot be classed among its attributes, I am far from maintaining that it does not pass from the ‹service› to the ‹product›, so as (if I may be allowed the expression) to become incorporated with it. I hope my opponents will not believe that I am pedant enough to wish to exclude from common language such phrase as these—gold ‹has value›, wheat ‹has value›, land ‹has value›. But I have a right to demand of science why this is so? and if I am answered, because gold, wheat, and land possess in themselves intrinsic ‹value›, then I think I have a right to say—“You are mistaken, and your error is dangerous. You are mistaken, for there are gold and land which are destitute of value, gold and land which have not yet had any human labour bestowed upon them. Your error is dangerous, for it leads men to regard what is simply a right to a reciprocity of services as a usurpation of the gratuitous gifts of God.”

I am quite willing, then, to acknowledge that products are possessed of value, provided you grant me that it is not essential to them, and that it attaches itself to services, and proceeds from them.

This is so true, that a very important consequence, and one which is fundamental in Political Economy, flows from it—a consequence which has not been, and indeed could not be remarked. It is this:—

‹Where value has passed from the service to the product, it undergoes in the product all the risks and chances to which it is subject in the service itself.›

It is not fixed in the product, as it would have been had it been one of its own intrinsic qualities. It is essentially variable; it may rise indefinitely, or it may fall until it disappears altogether, just as the species of service to which it owes its origin would have done.

The man who makes a cup to-day for the purpose of selling it a year hence, confers value on it, and that value is determined by that of the service—not the value which the service possesses at the present moment, but that which it will possess at the end of the year. If at the time when the cup comes to be sold such services are more in demand, the cup will be worth more, or it will be depreciated in the opposite case.

This is the reason why man is constantly stimulated to exercise foresight, in order to turn it to account. He has always in [p177] perspective a possible rise or fall of value,—a recompense for just and sagacious prevision, and chastisement when it is erroneous. And, observe, his success or failure coincides with the public good or the public detriment. If his foresight has been well directed, if he has made preparations beforehand to give society the benefit of services which are more in request, more appreciated, more efficacious, which supply more adequately wants which are deeply felt, he has contributed to diminish the scarcity, to augment the abundance, of that description of service, and to bring it within the reach of a greater number of persons at less expense. If, on the other hand, he is mistaken in his calculations for the future, he contributes, by his competition, to depress still farther those services for which there is little demand. He only effects, and at his own expense, a negative good,—he advertises the public that a certain description of wants no longer call for the exertion of much social activity, which activity must now take another direction, or go without recompense.

This remarkable fact—that ‹value›, ‹incorporated› in a product, depends on the value of the kind of service to which it owes its origin—is of the very highest importance, not only because it demonstrates more and more clearly the theory that the principle of value resides in the service, but because it explains, easily and satisfactorily, phenomena which other systems regard as abnormal and exceptional.

When once the product has been thrown upon the market of the world, do the general tendencies of society operate towards elevating or towards depressing its ‹value›? This is to ask whether the particular kind of services which have engendered this value are liable to become more or less appreciated, and better or worse remunerated. The one is as possible as the other, and it is this which opens an unlimited field to human foresight.

This we may remark at least, that the general law of beings, capable of making experiments, of acquiring information, and of rectifying mistakes, is progress. The probability, then, is, that at any given period a certain amount of time and pains will effect greater results than were effected by the same agency at an anterior period: whence we may conclude that the prevailing tendency of ‹value›, ‹incorporated› with a commodity, is to fall. If, for example, we suppose the cup which I took by way of illustration, and as a symbol of other products, to have been made many years ago, the probability is that it has undergone depreciation, inasmuch as we have at the present day more resources for the manufacture of such articles, more skill, better tools, capital [p178] obtained on easier terms, and a more extended division of labour. In this way the person who wishes to obtain the cup does not say to its possessor, Tell me the exact amount of labour (quantity and quality both taken into account) which that cup has cost you, in order that I may remunerate you accordingly. No, he says, Now-a-days, in consequence of the progress of art, I can make for myself, or procure by exchange, a similar cup at the expense of so much labour of such a quality; and that is the limit of the remuneration which I can consent to give you.

Hence it follows that all labour incorporated with commodities, in other words, all accumulated labour, all capital, has a tendency to become depreciated in presence of services naturally improvable and increasingly and progressively productive; and that, in exchanging present labour against anterior labour, the advantage is generally on the side of present labour, as it ought to be, seeing that it renders a greater amount of service.

This shows us how empty are the declamations which we hear continually directed against the value of landed property. That value differs from other values in nothing—neither in its origin, nor in its nature, nor in the general law of its slow depreciation, as compared with the labour which it originally cost.

It represents anterior services,—the clearing away of trees and stones, draining, enclosing, levelling, manuring, building: it demands the recompense of these services. But that recompense is not regulated with reference to the labour which has been actually performed. The landed proprietor does not say. “Give me in exchange for this land as much labour as it has received from me.” (But he would so express himself if, according to Adam Smith’s theory, value came from labour, and were proportional to it.) Much less does he say, as Ricardo and a number of economists suppose, “Give me first of all as much labour as this land has had bestowed upon it, and a certain amount of labour over and above, as an equivalent for the natural and inherent powers of the soil.” No, the proprietor, who represents all the possessors of the land who have preceded him, up to those who made the first clearance, is obliged, in their name, to hold this humble language:—

“We have prepared services, and what we ask is to exchange these for equivalent services. We worked hard formerly, for in our days we were not acquainted with your powerful means of execution—there were no roads—we were forced to do everything by muscular exertion. Much sweat and toil, many human lives, are buried under these furrows. But we do not expect from you [p179] labour for labour—we have no means of effecting an exchange on those terms. We are quite aware that the labour bestowed on land now-a-days, whether in this country or abroad, is much more perfect and much more productive than formerly. All that we ask, and what you clearly cannot refuse us, is that our anterior labour and the new labour shall be exchanged, not in proportion to their comparative duration and intensity, but proportionally to their results, so that we may both receive the same remuneration for the same service. By this arrangement we are losers as regards labour, seeing that three or four times more of ours than of yours is required to accomplish the same service; but we have no choice, and can no longer effect the exchange on any other terms.”

And, in point of fact, this represents the actual state of things. If we could form an exact estimate of the amount of efforts, of incessant labour, and toil, expended in bringing each acre of our land to its present state of productiveness, we should be thoroughly convinced that the man who purchases that land does not give labour for labour—at least in ninety-nine cases out of the hundred.

I add this qualification, because we must not forget that an ‹incorporated service› may gain value as well as lose it. And although the general tendency be towards depreciation, nevertheless the opposite phenomenon manifests itself sometimes, in exceptional circumstances, as well in the case of land as of anything else, and this without violating the law of justice, or affording adequate cause for the cry of monopoly.

Services always intervene to bring out the principle of value. In most cases the anterior labour probably renders a less amount of service than the new labour, but this is not an absolute law which admits of no exception. If the anterior labour renders a less amount of service than the new, as is nearly always the case, a greater quantity of the first than of the second must be thrown into the scale to establish the equiponderance, seeing that the equiponderance is regulated by services. But if it happen, as it sometimes may, that the anterior labour renders greater service than the new, the latter must make up for this by the sacrifice of quantity. [p180]

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