HM abstract

I was planning to attend and present at the London Historical Materialism this November – but it turns out, disappointingly, that I’m not going to be able to make it. I’m putting my abstract online here anyway, mostly as a way of pushing myself to write this material up, even if I won’t be able to deliver the paper at the HM event. Obviously this material is ultimately meant to be incorporated into the ‘Brief History of Capitalism’ project, in one way or another. (I don’t expect to be able to write this stuff up for a while yet, I should say, so this post is another promissory note.)

International Credit and the Origins of Capitalism

The recent global economic crisis has placed sovereign debt and international credit at the center of critical analysis of the dynamics of capitalist society. In this paper I aim to locate contemporary analyses of sovereign debt within a broader historical context, by revisiting canonical Marxist debates around the transition from feudalism to capitalism. I briefly outline the principal opposing theoretical positions in these debates: on the one hand a class-conflict analysis of shifts in relations of production within ‘feudal’ society; on the other hand an emphasis on the expansion of exchange relations, and a corresponding shift from autarkic to market-based economic structures. I argue that both of these understandings of the emergence and core characteristics of capitalist society fail to provide an adequate analysis of capitalism as an international dynamic, and that neither gives an adequate causal account of the social pressures behind “so-called primitive accumulation”. I then return to Chapter 31 of Capital I, to discuss Marx’s compressed but extremely rich analysis of the international credit system in the sixteenth century. I argue that international credit plays a far more pivotal role in Marx’s analysis of the emergence and reproduction of capitalist society than has often been recognised, and that contemporary Marxist analyses of global capitalist dynamics could profitably re-emphasise the central role of international credit in the capitalist drive to accumulation.

The Abolition of Labour

This began as a comment below a post at Reid’s very interesting new blog The Luxemburgist – but it grew to mammoth proportions, so I’ve turned it into a post here; I hope Reid doesn’t mind. The context is a discussion of the Labour Theory of Value and, relatedly, the question of whether Marx’s politics is (and whether Marxist politics should be) oriented towards ‘the abolition of labour’. I’m of the opinion that, yes, the abolition of labour should be a central goal for Marxists (and I think it was a central goal for Marx). But I don’t have a good enough knowledge of the different theoretical traditions to point at a (not-by-Marx) text that I think makes this case persuasively. I need to do more reading in this regard.

On the question of the abolition of labour, then – the issue is partly what we mean by labour. As you say, Marx certainly has no problem deploying the category in a very general way, and using it beyond the (capitalist) social conditions that currently make it intuitive. So Marx doesn’t think we can abolish human physical activity oriented towards a constructive end (for instance)! But there’s a complex game with the category, in Capital, where (again, as you say) Marx starts off defining it very broadly, and then shows how this very broad category is made available as a category – made ‘socially valid’ (and also socially portable, as it were) – by much more specific social conditions. Those (capitalist) social conditions are what Marx wants to abolish.

The question then is: what exact social conditions are (or should be) the target of Marx’s (or our) critique? I think there are various possible answers to this, in different strands of the Marxist tradition.

One very common answer is that Marx wants to abolish exploitation – ‘exploitation’ meaning (for this strand of the tradition) an economic situation in which a portion of the worker’s output, often understood in value terms, is confiscated from the worker and used to support a wealthy and parasitic ruling class. The usual corollary of this position is that if the parasitic ruling class could be eliminated, such confiscation would no longer take place: workers would receive the entire value of their product; this would be an economically just distributive situation; and the negative features of capitalist socio-economic organisation would have been overcome. The LTV is often used as a foundation for this kind of position: the LTV is taken to give us a way of establishing something like a just or natural reward for labour, and Marx’s analysis of the extraction of surplus value is taken to be an analysis of the social coercions by means of which a portion of that just or natural reward is pocketed by the capitalist ruling class. The goal of socialist politics is then basically the elimination of surplus-value extraction. Labour can still be understood as central to socio-economic life in a post-capitalist society. But labour would be appropriately rewarded – it would be ‘realised’, as they say – instead of exploited.

A second (not at all incompatible – in fact these often go together) way of understanding the kind of social transformation Marx wants re: labour, is that he wants the abolition of specifically wage labour. The idea here is basically that Marx wants the abolition of the institution of the labour market – perhaps as part of a broader abolition of markets in general, or perhaps not. Again, this approach is entirely compatible with the continuing centrality of labour to socio-economic life – and it’s of course compatible with (although it does not require) the idea that labour will, in a future communist society, receive its just reward. So a prominent view in the Marxist tradition would run something like: the LTV gives an account of exploitation; we need to eliminate exploitation; the best way to do this is to eliminate the wage labour market. There is also of course the option of eliminating the wage labour market but not eliminating exploitation: I shouldn’t think many people would advocate for this – but it’s a common account of what went wrong with a lot of attempts to realise communist political ideals (in the Soviet Union, for instance – which ended up with a parasitic ruling class living off the labour of others; there were just different mechanisms for managing and exploiting labour from those associated with wage-labour markets, and therefore a different kind of ruling class).

Now, I don’t think either of these political goals (just reward for labour; elimination of the wage-labour market) are what Marx principally had in mind with his critique of capitalism. I think he’s actively opposed to the idea of a just reward for labour as an ultimate political goal (c.f. the beginning of Critique of the Gotha Program, for instance, or the very end of Value, Price and Profit. He thinks the idea of a just reward for labour can be tactically very useful in fighting for better wages under capitalism, and he fully endorses that fight – but he sees the idea of a ‘just reward for labour’ as basically a conservative idea.) Marx definitely does want the abolition of wage-labour – there’s no question that this is a central political goal for Marx. But while a fair bit of the Marxist tradition understands this goal in terms of the elimination of wage-labour specifically, in order better to realise labour in some other form, I think we should see the elimination of the wages system as part of a larger project to eliminate the institution of labour more broadly conceived.

What does this mean? Without grounding this textually in Marx’s work (which I think could be done, but which would take a fair bit of work) – I’d argue that Marx basically wants: 1) Everyone to have a lot more leisure time. 2) People’s access to the necessities (and luxuries) of life not to be principally mediated via reward for work. [These two things aren't all that Marx wants, of course - he also wants the elimination of poverty and of various forms of economic and political violence, for instance - I just think that these are the main things he means when he talks about the abolition of labour.]

Marx basically thinks that these goals are achievable (i.e. they’re not utopian) because of mechanisation. Marx thinks that mechanised mass-producing industry – an extremely recent historical innovation (and one of the principal social resources that capitalism has created) – gives us the technical and social ability to support huge populations of human beings in a comfortable way, without those human beings having to spend most, or even much, of their lives working. If you like, Marx basically wants a slave society, but with machines instead of slaves. This social and technological possibility is very historically new, but Marx thinks we should seize it, and create a society in which labour (as an economic institution) will not be at the centre of anyone’s lives.

(Obviously some work would still have to be done in the kind of society Marx envisages – there’d still be a lot of unpleasant non-mechanisable tasks that people would have to do. And of course the leisure time that such an institutional transformation would make available could be used in pretty much whatever way people liked, including ways that might today be pursued as paid occupations. But work for economic reward would not be the principal focus of social activity for the bulk of mankind: this is one of Marx’s goals. In a communist society, as Marx sees it, there would be no proletariat.)

In Marx’s theoretical (as opposed to directly polemical or political) work, he sets himself two tasks (among others). First, to give an account of the social resources that can be appropriated to build an alternative society. And second, to give an account of the social obstacles to the realisation of that society. (This is all part of a general analytic description of capitalist social forms, of course.) For Marx, the very existence of capitalist large-scale mechanised industry creates both an opportunity and a puzzle: why is this large-scale mechanisation of the tasks required to feed, clothe, house, etc. vast populations – why is this mechanisation having the impact it is on society? Large-scale machinery massively reduces the amount of labour required to achieve the tasks it mechanises. Why then is it creating and recreating an industrial proletariat, who must be slaves to this machinery day and night, in the most grotesque conditions? More broadly: why is the phasing out of individual labour-tasks, by mechanisation, not resulting in the aggregate reduction of labour across the entire economy? This is a puzzle that Marx thinks needs to be answered: a large part of the theoretical work in Capital involves the tracking of the social structures that, taken all together, reproduce the existence of a proletariat, even when at the level of the individual firm and industry the overwhelming and ongoing trend is toward the reduction in the need by industry for labour. This account of the reproduction of a proletariat (the society-wide dynamic of the displacement and reconstitution of labour) is (and here, as in all my discussions of Marx (and as you know), I am channelling N. Pepperell’s interpetation of Capital!) at the heart of Marx’s analysis of capitalism – it is, for Marx, the defining feature of capitalist society.

The corollary of this is that the defining feature of effective anti-capitalist politics, Marx believes, should be the elimination of this general socio-economic dynamic – and, as part of that, the abolition of labour. In that sense, although his understanding of the social forms that create and give ‘social validity’ to the category of labour changes across his corpus, Marx never retreats from the early formulation of The German Ideology:

[T]he proletarians, if they are to assert themselves as individuals, will have to abolish the very condition of their existence hitherto (which has, moreover, been that of all society up to the present), namely, labour.

Marx Reading Group: Marx’s Sarcasm

Okay – so Chapter 25 of Capital is a monster, and I think it’ll take me quite a while to re-read it, taking notes, in a way that’ll allow me to say something helpful about the whole. So I thought I’d throw out a short ‘this is great’ kind of post before trying to say something more substantive.

There are a few qualities of Marx as a writer that are quite unusual, to my mind. First off, I’m not sure I know another writer/thinker of Marx’s stature who uses sarcasm so pervasively and centrally. It’s not just that he’s a sarcastic son of a bitch – although obviously he is. It’s that the sarcasm is woven deep into his articulation of many of his most central claims. Capital is (of course) a critique of political economy. But a lot of the time that critique is manifest mainly in Marx’s bitter, sardonic, bathetic turn of phrase. Hegelian (of a sort) that he is, Marx likes to articulate many of his points in a manner immanent to the positions being criticised – he wants to unfold the horrors of capitalism from out of the discourses aimed towards capitalist apologetics. Part of Marx’s reasoning, I think, is that if even those political economists most committed to making the case for capitalism, can be made to yield insights condemnatory of capitalism, Marx will have given his own condemnation extra power – made it more compelling. (He also, of course, wants to show that his own position contains the best of what he criticises.) (Plus he wants to show where the positions he criticises come from, what makes them – why and how.) [N Pepperell's written a lot on issues related to this stuff - Marx's presentational strategy, standpoint of critique, and lots of other things. I won't put links to NP's work in every post, because I think that'd be annoying - so take this as a general indication that a great deal of the stuff in my posts on Capital is going to be derived from NP's work.] There’s an interesting double aspect to this procedure. On the one hand, Marx is overflowing with bile and rage at the apologism for violence and coercion that he encounters everywhere in the political economic literature. He never tires of denouncing bullshit – and it seems clear that this act of denunciation – holding up for all the world to see some particularly egregious piece of apologism, no matter how minor the text he finds it in – was one of the ways he motivated himself in his incredible labours of reading, assimilation, and synthesis. Marx the student of political economy will trudge through any piece of text – government reports, minor but interminable academic controversies, countless historical tracts. The reward at the end of it, for us, is Capital. But Marx needs more immediate satisfactions – and this is part of where the endless vicious pleasure of displaying the results of political-economic self-deception and self-interest comes from, I think. One can almost feel Marx’s glee as he happens upon a particularly revealing phrase on page 800 of some committee transcript.

On the other hand, although Marx is tireless in these condemnations, he is also doing work with his sarcastic deployment of other thinkers. The second thing that’s unusual about Marx as a writer, to my mind, is the extent to which (and the way in which) he deploys quotations. Marx will quote any fucking thing. Sometimes one wonders if there’s anything he read that he didn’t quote. (Obviously this impression is exacerbated by the fact that so much of his draftwork is extant..) So much of Marx’s own argument is made through the use of quotations. If Marx wants to say something, in Capital, he’ll find someone who’s already said it (if he can), quote them, and then show how this insight is far more powerfully and adequately articulated as part of Marx’s account of capitalism, than it is as part of whatever shonky system Marx has pulled the quote from.

Marx’s quotations, then, and the sarcastic way in which he deploys them, are central to his work.

This is by way of leading in to my favourite bit of Chapter 25 so far, re-reading. Which is Marx’s use, almost right at the start of the chapter, of Mandeville’s Fable of the Bees. (Not a minor text, in terms of capitalist apologetics.) On pages 764-765 of the Fowkes Penguin edition, Marx quotes Mandeville [ellipses and square brackets are in the text]:

“It would be easier, where property is well secured, to live without money than without the poor; for who would do the work? … As they [the poor] ought to be kept from starving, so they should receive nothing worth saving. If here and there one of the lowest class, by uncommon industry, and pinching his belly, lifts himself above the condition he was brought up in, nobody ought to hinder him; nay, it is undeniably the wisest course for every person in the society, and for every private family to be frugal; but it is in the interest of all rich nations, that the greatest part of the poor should almost never be idle, and yet continually spend what they get… Those that get their living by their daily labour… have nothing to stir them up to be serviceable but their wants which it is prudence to relieve, but folly to cure. The only thing then that can render the labouring man industrious, is a moderate quantity of money, for as too little will, according as his temper is, either dispirit or make him desperate, so too much will make him lazy… From what has been said, it is manifest, that, in a free nation, where slaves are not allowed of, the surest wealth consists in a multitude of laborious poor; for besides that they are the never failing nursery of fleets and armies, without them there could be no enjoyment, and no product of any country could be valuable. To make the society” (which of course consists in non-workers) “happy and people easier under the meanest circumstances, it is requisite that great numbers of them should be ignorant as well as poor; knowledge both enlarges and multiplies our desires, and the fewer things a man wishes for, the more easily his necessities may be supplied.”

What’s so great here (if ‘great’ is the word) – apart from the sheer hideousness of the quote – is the way that Marx deploys it. Marx doesn’t disagree with Mandeville’s analysis of capitalism – he thinks it’s more or less spot on. He just thinks Mandeville is an evil motherfucker. Marx’s small sarcastic textual intervention (“(which of course consists in non-workers)”) completely transforms (if it needed transforming, which apparently it does) the emphases and values of the passage quoted. Marx here hones in on the intellectual dishonesty that permits the ‘respectable’ propagation of this political and ethical monstrosity – the identification of ‘society’ with the tiny portion of society “which of course consists in non-workers”. Capitalist synecdoche. This – right up until our own time, and into the future of capitalism as well – is the most pervasive form of apologism. ‘Society’ benefits from the capitalist system. And of course ‘society’ is all of us. But in fact ‘society’ consists, really and truly, only in those who benefit. And since those who benefit benefit, everything is fine in the world. [Of course this is only part of Mandeville's point. The other part is that if people are oppressed enough not to realistically desire decent living standards, they won't mind the absence of decent living standards.]

Marx will consistently do this, throughout Capital. He will quote political economy, and at times he will disagree with it, and at times he will agree with it. But he will, throughout, show us what political economy means – and how this meaning – in however fig leaf a fashion – is obscured by political economy’s own forms of articulation. There’s a huge amount going on in Capital, and in Chapter 25, besides this, of course. But that can wait for other (and others’) posts.

Notes [Smith, Sweezy]

Okay. For purposes of clarification, principally self-clarification, I’m going to be working through the early sections of The Wealth of Nations – the sections that develop Smith’s version of the labour theory of value. This is basically note-taking stuff, so don’t expect scintillating reading.

Here’s the opening paragraph of Smith’s Chapter V:

Every man is rich or poor according to the degree in which he can afford to enjoy the necessaries, conveniencies, and amusements of human life. But after the division of labour has once thoroughly taken place, it is but a very small part of these with which a man’s own labour can supply him. The far greater part of them he must derive from the labour of other people, and he must be rich or poor according to the quantity of that labour which he can command, or which he can afford to purchase. The value of any commodity, therefore, to the person who possesses it, and who means not to use or consume it himself, but to exchange it for other commodities, is equal to the quantity of labour which it enables him to purchase or command. Labour, therefore, is the real measure of the exchangeable value of all commodities.

That “therefore” is, I think, question-begging. There’s a vast argumentative leap between sentences 3 and 4. Fortunately Smith goes on to explain himself.

The real price of everything, what everything really costs to the man who wants to acquire it, is the trouble and toil of acquiring it. What everything is really worth to the man who has acquired it, and who wants to dispose of it or exchange it for something else, is the toil and trouble which it can save to himself, and which it can impose upon other people. What is bought with money or with goods is purchased by labour as much as what we acquire by the toil of our own body. That money or those goods indeed save us this toil. They contain the value of a certain quantity of labour which we exchange for what is supposed at the time to contain the value of an equal quantity. Labour was the first price, the original purchase-money, that was paid for all things. It was not by gold or by silver, but by labour, that all the wealth of the world was originally purchased; and its value, to those who possess it, and who want to exchange it for some new productions, is precisely equal to the quantity of labour which it can enable them to purchase or command.

Here we’re getting to the real stuff. The key lines:

1) “The real price of everything, what everything really costs to the man who wants to acquire it, is the trouble and toil of acquiring it.”

2) “Labour was the first price, the original purchase-money, that was paid for all things.”

3) “its value… is precisely equal to the quantity of labour which it can enable them to purchase or command.”

We have here, I think, the core of an important emotional/physical truth: what we value is what we are willing to give things up for; and the most basic thing we can give up is ourselves. We give up our lives – and we give up portions of our lives, in the form of time. There is a connection between value and life-time, body-time.

Wealth, as Mr. Hobbes says, is power. But the person who either acquires, or succeeds to a great fortune, does not necessarily acquire or succeed to any political power, either civil or military. His fortune may, perhaps, afford him the means of acquiring both, but the mere possession of that fortune does not necessarily convey to him either. The power which that possession immediately and directly conveys to him, is the power of purchasing; a certain command over all the labour, or over all the produce of labour which is then in the market. His fortune is greater or less, precisely in proportion to the extent of this power; or to the quantity either of other men’s labour, or, what is the same thing, of the produce of other men’s labour, which it enables him to purchase or command. The exchangeable value of every thing must always be precisely equal to the extent of this power which it conveys to its owner.

This is good stuff. Wealth is power. Not political power – though it can often enable access to that too – but economic power, power produced by and deployed through the institution of the marketplace. Wealth, because it is used to purchase commodities, is power over the producers of those commodities. If I purchase a car, then through the many mediations of exchange and production, people are working for me – working to make me a car. Or they have been working – the institutions of money and the market dissociate the command from the obedience: the obedience precedes the command, and this dissociation, this distancing, permits the illusion to arise and be maintained that a power relationship is not, fundamentally, what we are dealing with here. Furthermore, this dissociation of command and obedience must be maintained through power-dynamics that are entirely separate from the ‘abstract’ power of money – from the power-relationship of consumer-producer: a social system of other power-dynamics must be in place for money to possess this power in the first place – for “the power of purchasing” to be a real power, over real people. For my purchasing-commands to be obeyed, pre-emptively, larger social power-forces must create a specific social system, in which this use of power is ordinary, everyday, unremarked.

But now we start hitting the problems:

But though labour be the real measure of the exchangeable value of all commodities, it is not that by which their value is commonly estimated. It is often difficult to ascertain the proportion between two different quantities of labour. The time spent in two different sorts of work will not always alone determine this proportion. The different degrees of hardship endured, and of ingenuity exercised, must likewise be taken into account. There may be more labour in an hour’s hard work than in two hours easy business; or in an hour’s application to a trade which it cost ten years labour to learn, than in a month’s industry at an ordinary and obvious employment. But it is not easy to find any accurate measure either of hardship or ingenuity. In exchanging indeed the different productions of different sorts of labour for one another, some allowance is commonly made for both. It is adjusted, however, not by any accurate measure, but by the higgling and bargaining of the market, according to that sort of rough equality which, though not exact, is sufficient for carrying on the business of common life.

I won’t keep quoting at length – but Smith goes on to say that “money has become the common instrument of commerce” and that money, not labour, therefore comes to be the intuitive measure of value.

Jump completely now. Jump to Sweezy’s Theory of Capitalist Development, picking up at the start of Chapter III – ‘The Quantitative Value Problem’. Smith has formulated the problem: it is extremely difficult to see how different labouring activities can be compared. Sweezy picks this up:

labour more skilled than average (or ‘simple’) labour must have a correspondingly greater power of producing value. … The quantitative relation between an hour of simple labour and an hour of any given type of skilled labour is observable in the relative values of the commodities which they produce in one hour. This does not mean, of course, that the relation between two types of labour is determined by the relative values of their products. To argue in this way would be circular reasoning. The relation between the two types of labour is theoretically susceptible to measurement independently of the market values of their products.

I do not see that circular reasoning is a problem in economic analysis of this kind. Sweezy is claiming here that labour’s power of producing value is analysable independently of the market value of its products. In other words – economic value is analysable independently of market value.

Okay. Sweezy has established that value is analysable entirely in terms of labour time, and can be analysed through the analytic reduction of all kinds of labour to simple labour. Now we get back to Smith, via Sweezy.

[Sweezy:] Let us first enquire under what conditions exchange ratios would correspond exactly to labour-time ratios. Adam Smith’s famous deer-beaver example, which was also used by Ricardo, provides a convenient starting point.

[Quoting Smith, start of Chapter VI:] “In that early and rude state of society which precedes both the accumulation of stock and the appropriation of land, the proportion between the quantities of labour necessary for acquiring different objects seems to be the only circumstance which can afford any rule for exchanging them for one another. If among a nation of hunters, for example, it usually costs twice the labour to kill a beaver which it does to kill a deer, one beaver should naturally exchange for or be worth two deer. It is natural that what is usually the produce of two days or two hours labour, should be worth double of what is usually the produce of one day’s or one hour’s labour.”

[Sweezy continues:] Adam Smith’s hunters are what Marx would have called simple commodity producers, each hunting with his own relatively simple weapons, in forests which are open to all, and satisfying his needs by exchanging his surplus catch against the products of other hunters. Why, under these circumstances, would deer and beaver exchange in proportion to the quantity of time required to kill each? It is easy to supply a proof for what Adam Smith took for granted.

A hunter by spending two hours of his time can have either one beaver or two deer. Let us imagine now that one beaver exchanges for one deer ‘on the market’. Under the circumstances any one would be foolish to hunt beaver. For in one hour it is possible to catch a deer and thence, by exchange, to get a beaver, whereas to get a beaver directly would require two hours. Consequently this situation is unstable and cannot last. The supply of deer will expand, that of beaver contract until nothing but deer is coming on the market and no takers can be found. Following this line of reasoning it is possible to show by exclusion that only one exchange ratio, namely one beaver for two deer, does constitute a stable situation. When this ratio rules in the market, beaver hunters will have no incentive to shift to deer hunting, and deer hunters will have no incentive to shift to beaver hunting. This, therefore, is the equilibrium ratio of exchange. The value of one beaver is two deer and vice versa. Adam Smith’s proposition is thus demonstrated to be correct.

To get this result two implicit assumptions are necessary, namely, that hunters are prepared to move freely from deer to beaver if by so doing they can improve their position; and that there are no obstacles to such movement. In other words, the hunters must be both willing and able to compete freely for any advantages which may arise in the course of exchange by shifting their labour from one line to another. Given this kind of competition in a society of simple commodity production, supply and demand will be in equilibrium only when the price of every commodity is proportional to the labour time required to produce it. Conversely prices proportional to labour times will be established only if the forces of competitive supply and demand are allowed to work themselves out freely. The competitive supply-and-demand theory of price determination is hence not only not inconsistent with the labour theory; rather it forms an integral, if sometimes unrecognized, part of the labour theory.

Sweezy’s version of the labour theory of value thus has three pillars.

1) Labour and labour alone produces value. The value of commodities is the amount of simple labour required to produce them.

2) There is a measurable simple given-value-producing labour time, into which all labour can be analysed, and which can be ascertained entirely independent of its products’ market value.

3) Market value will nonetheless tend to converge with labour value, provided the economic structure of society permits free movement of labour between industries.

Or:

1) Value has always and everywhere been produced by labour and only by labour.

2) Only in a form of society where labour can move freely between industries will market value be regulated by actual value.

Why would labour and only labour produce value? Smith provides an explanation for this: labour is the original purchase-money for all things. Everything comes back to the physical human body – and the exchange of this body, or of this body’s activities, for all other human goods.

The only true money is flesh.

Or: Flesh has been re-imagined in the image of money – in the image of the commodity.

Current Affairs

Capital Vol. III p. 621:

“In a system of production where the entire interconnection of the reproduction process rests on credit, a crisis must evidently break out if credit is suddenly withdrawn and only cash payment is accepted, in the form of a violent scramble for means of payment. At first glance, therefore, the entire crisis presents itself as simply a credit and monetary crisis. And in fact all it does involve is simply the convertibility of bills of exchange into money. The majority of these bills represent actual purchases and sales, the ultimate basis of the entire crisis being the expansion of these far beyond the social need. On top of this, however, a tremendous number of these bills represent purely fraudulent deals, which now come to light and explode; as well as unsuccessful speculations conducted with borrowed capital, and finally commodity capitals that are either devalued or unsaleable, or returns that are never going to come in. It is clear that this entire artificial system of forced expansion of the reproduction procerss cannot be cured by now allowing one bank, e.g. the Bank of England, to give all the swindlers the capital they lack in paper money and to buy all the depreciated commodities at their old nominal values.”