9i enlarging of the cycle was not in front of us, and thus to suggest the exact contrary of the former assumption, and he warned us against the abstract deduction that these crises must repeat themselves in the old form.* The history of individual industries shows that their crises by no means always coincide with the so-called general crises. Marx, as we have seen, believed he could establish on the need of an accelerated renewal of fixed capital (implements of production, etc.) a material foundation for periodic crises,! and it is un- doubtedly true that an important reason for crises is to be found here. But it is not accurate, or not more accurate, that these periods of renewal coincide as to time in the various industries. And therewith a further factor of the great general crisis is done away with.
There remains then only so much, that the capacity for production in modern society is much greater than the actual demand for products determined by the buying capacity; that millions live insufficiently housed, insuffi- ciently clad, and insufficiently nourished, in spite * We are, of course, only speaking here of the purely economic foundation of crises. Crises as results of political events (wars and serious threatenings of war) or of very widespread failures of crops — local failures no longer exercise any effect in this respect — are of course always possible.
The use of the word " material " in the passage mentioned (Vol. IL, p. 164) is not without interest in judging how Marx understood this word. According to the present usual definition of the word the explanation of crises from under-consumption would be quite as materialistic as founding it on changes in the process of production, or in implements.
92 of abundant means at hand for sufficient hous- ing, nourishment, and clothing; that out of this incongruity, over-production appears again and again in different branches of production, so that either actually certain articles are produced in greater amounts than can be used — for ex- ample, more yarn than the present weaving mills can work — or that certain articles are produced not indeed in a greater quantity than can be used, but in a greater quantity than can be bought; that in consequence of this, great irregularity occurs in the employment of the workers, which makes their situation extremely insecure, weighs them down in unworthy de- pendence, brings forth over-work here and want of work there; and that of the means employed to-day to counteract the most visible part of this evil, the Kartels represent monopolist unions — on the one side against the workers, and on the other against the great public — which have a tendency to carry on warfare over the heads of these and at their cost with the same kind of monopolist unions in other industries or other lands, or, by international or inter-industrial agreements, arbitrarily to adapt production and prices to their need of profit. The capitalistic means of defence against crises virtually bear within themselves the possibilities of a new and more hopeless serfdom for the working classes, as well as of privileges of production which revive in acute form the old guild privileges. It appears to me to be much more important at present, from the standpoint of the workers, to keep before our eyes th^ oossibilities of Kartels and trusts than to prophesy their " impotence. M It is for the working class a subordinate ques- tion whether these combinations will be able, in the course of time, to attain their first-mentioned object — the warding off of crises. But it becomes a question full of importance as soon as expectations of any kind as regards the movement for the emancipation of the working classes are made dependent upon the question of the general crisis. For then the belief that Kartels are of no effect against crises may be the cause of very disastrous neglect.
The short sketch which we gave in the intro- duction to this chapter of the Marx-Engels explanations of economic crises will suffice, in conjunction with the corresponding facts adduced, to show that the problem of crises cannot be solved by a few well-preserved catch-words. We can only investigate what elements of modern economy work in favour of crises and what work against them. It is im- possible to pre-judge ä priori the ultimate relation of these forces to one another, or their development. Unless unforeseen external events bring about a general crisis — and as we have said that can happen any day — there is no urgent reason for concluding that such a crisis will come to pass for purely economic reasons. Local and partial depressions are unavoidable; general stagnation is not unavoidable with the present organisation and extension of the world market, and particularly with the great exten- sion of the production of articles of food. The latter phenomenon is of peculiar importance for 94 our problem. Perhaps nothing has contributed so much to the mitigation of commercial crises or to the stopping of their increase as the fall of rent and of the price of food.* * Note to the English edition. — This was written in the winter 1898-1899 before the South African War had produced new conditions on the money market and a great increase in armaments. In spite of these facts the crisis that broke out in 1901 was of shorter life than a good many of the earlier crises, and was followed by a longer period of prosperity.
Chapter III.
THE TASKS AND POSSIBILITIES OF SOCIAL DEMOCRACY.
(a) The political and economic preliminary conditions of socialism.
If we asked a number of men belonging to any class or party to give in a concise formula a definition of socialism, most of them would be somewhat confused. He who does not repeat at random some phrase he has heard must first make clear to himself whether he has to characterise a state, a movement, a percep- tion, or an aim. If we consult the literature of socialism itself, we shall come across very various explanations of its concept according as they fall into one or other of the categories designated above — from the derivation of the concept from juridical notions (equality, justice) or its summary characterisation as social science, up to its identification with the class struggle of the workers in modern society and the explanation that socialism means co-opera- tive economics. In some cases conceptions founded on entirely different principles are the grounds for this variety of explanations; but they are mostly only the results of observing or representing one and the same thing from different points of view.
96 96 The most exact characterisation of socialism will in any case be that which starts from the concept of association because by it an economi- cal as well as — in the widest sense of the word — a juridical relation is expressed at the same time. It needs no long-winded deduction to show that the indication of the juridical nature of socialism is just as important as that of its economic nature. Quite apart from the ques- tion whether or in what sense law is a primary or secondary factor in the life of a community, the nature of its law undoubtedly in each case gives the most concentrated idea of its char- acter. We characterise forms of communities, not according to their technological or economic foundations, but according to the fundamental principle of their legal institutions. We speak, indeed, of an age of stone, bronze, machinery, electricity, etc., but of a feudal, capitalistic, bourgeois, etc., order of society. To this would correspond the definition of socialism as a movement towards — or the state of — an order of society based on the principle of association. In this sense, which also corresponds with the etymology of the word (socius — a partner), the word is used in what follows.
Now what are the preliminary conditions of the realisation of socialism? /^Historical materialism sees them first in the modern development of pro- duction. With the spread of the capitalistic large enterprises in industry and agriculture there is assumed to be a lasting and steadily-increasing material cause for the impetus to a socialistic transformation of society. In these under- 97 97 takings production is already socially organised, only the management is individualistic and the profit is appropriated by individuals, not on the ground of their labour, but of their share of capital. The active worker is separated from the possession of his instruments of production, he is in the dependent condition of a wage- earner, from which he does not escape as long as he lives, and the pressure of it is rendered sharper by the uncertainty which is joined with this dependence both on the employer and on the fluctuations in the state of trade. Like pro- duction itself, the conditions of existence for the producers press towards the socialisation and the co-operative organisation of production and exchange. As soon as this development is sufficiently advanced the realisation of socialism Becomes an^ imperative necessity for the further development of the community. To carry it out is the task of the proletariat organised as a class party which for this purpose must take possession of the political governments According to that, we have asftfie first con- dition of the general realisation of socialism a definite degree of capitalist development, and as the second the exercise of political sove- reignty By the class party of the workers^ i.e., social_democracyH The dictatorship of the proletariat is, according to Marx, the form of the exercise of this power in the transition period.
As regards the first condition, it has already Been shown in the section on the " Classes of EstaBlishments in Production and DistriBution" 98 that if the large undertaking in industry pre- dominates to-day, yet it, including the businesses dependent on it, even in such an advanced country as Prussia, represents at the most only half the population engaged in production. The picture is not different if we take the statistics for the whole of Germany, and it is very little different in England, the most industrial country of Europe. In other foreign lands, perhaps with the exception of Belgium, the relation of the large enterprise to the small and medium business is still more unfavourable. But in agriculture we see everywhere the small and medium holding, as compared with the large one, not only greatly predominating, but also strengthening its position. In commerce and distribution the relation of the groups of undertakings is similar.
That the picture which the summarised figures of trade statistics give receives many corrections on a more recent examination of separate divisions, I have myself shown in my article on the Catastrophic Theory, after I had already expressly referred, in an earlier article of the series, Problems of Socialism, to the fact that the number of employees in an undertaking was no safe indication as to the degree of its capitalist nature.* * I wrote in an earlier article of the Problems of Socialism concerning the subordinate and branch estab- lishments in industry: " Such a subordinate establish- ment which is perhaps worked with very much constant (i.e., fixed) and with very little variable (i.e., wages) capital, which employs expensive machinery and few workers, comes thus, according to the practice of the 99 99 But this is of no particularly great conse- quence for us at present. Whether of the hundreds of thousands of small undertakings, a good number are of capitalistic character and others are wholly or partly dependent on large capitalist undertakings, this can alter very little the total result which the statistics of under- takings offer. The great and growing variety of undertakings, the graduated character of the structure of industrial enterprises, is not thereby disproved. If we strike out of the list a quarter or even a half of all small establishments as dependencies of medium and large enterprises, there remain in Germany almost a million undertakings from capitalist giant enterprises, downward in ever broadening classes to the hundred thousands of small enterprises worked in handicraft fashion, which may, indeed, pay tribute by-and-by to the process of concentra- tion, but on that account show no indication of disappearing from the scene.
It follows that as far as centralised enterprise forms a preliminary condition for the socialisa- tion of production and distribution, this is only Imperial statisticians, under small factories or even small workshops, whilst it really belongs to the capitalistic factories...We may assume it as quite certain that handicrafts and small factories appear much stronger in point of numbers in the trade statistics than they are in reality " (Neue Zeit xv. i, p. 308). And in respect to agriculture: " The area can be fairly small and yet be the scene of a thoroughly capitalistic business. Statistics founded on the size of the establishment in area, say less and less of their economic character " (ibid., p. 380). Similarly in my article on the Catastrophic Theory, on p. 552, xvi., 1, with respect to the figures for commerce and trade.
IOO IOO a partial condition in even the most advanced countries of Europe, so that if in Germany in the near future the state wished to expropriate all undertakings, say of twenty persons and upwards, be it for state management altogether or for partly managing and partly leasing them, there would still remain in commerce and industry hundreds of thousands of undertakings with over four millions of workers which would be excluded and be carried on under private management. In agriculture there would remain, if all holdings of over 20 hectares were nationalised — of which no one dreams — several millions of holdings under private management with a total of 9,000,000 workers. One can form an idea of the magnitude of the task which would be borne by the state, or the states, by taking over even the larger undertakings. It would be a question, in industry and commerce together, of about a hundred thousand busi- nesses with five to six million employees, and in agriculture of over 300,000 holdings with over five million workers. What abundance of judgment, practical knowledge, talent for administration, must a government or a national assembly have at its disposal to be even equal to the supreme management or managing control of such a gigantic organism!
But let us leave this question on one side for a time, and let us keep first of all firmly to the fact that the material preliminary condition for the socialisation of production and distribution — advanced centralisation of enterprises — is at present only partly achieved.
i^he second preliminary condition, according to the theory of Marx, is the conquest of the political power by the proletariat^ One can think of this conquest in various ways: by the path of parliamentary struggle, turning the right to vote to good account, or by the path of force by means of a revolution.* It is known that Marx and Engels, until pretty recently, considered the latter as nearly everywhere absolutely inevitable, and it seems unavoidable to various adherents of the Marxist doctrine to-day. Often it is also considered the shorter way. t * " Revolution " is here used exclusively in its political meaning, as synonymous with a rising or unlawful force. For the change in the order of society, on the other hand, the term " social reorganisation " is used, which leaves open the question of the way. The object of this distinction is to exclude all misunderstandings and ambiguities.
" But to whom is it not evident that for the great towns where the workers form the overwhelming majority, if they had once attained the command of public power, of its administration, and the enactment of law — the economic revolution would have been only a question of months, nay, perhaps of weeks?" (Jules Guesde, Der achtezehnte März [1871] in der Provinz.
"But we declare: Give us for half a year the power of government, and the capitalist society would belong to history " (Parvus in the Sächsiche Arbeiterzeitung^ March The latter sentence stands at the end of an article in which, amongst ^ther things, it is shown that even after the social revolutionary government has taken the regu- lation of the total production in hand, the setting up of trade in commodities by an artificially thought-out system of exchange will not be practicable. In other words, Parvus, who has occupied himself seriously with eco- nomics, understands on the one side that "the trade in commodities has permeated so deeply all conditions of social life that it cannot be replaced by an artificially To this, people are led before all else by the idea that the working class is the most numerous and also the most energetic class of the com- munity. Once in possession of power, it would not rest until it had substituted for the founda- tions of the present system such arrangements as would make its restoration impossible.
It has already been mentioned that Marx and Engels, in the establishment of their theory of the dictatorship of the proletariat, had before their eyes as a typical example the epoch of terror of the French Revolution. Even in Anti- Dühring Engels declares that St. Simon, in 1792, by regarding the reign of terror as the reign of the masses without means, made a discovery worthy of a genius. That is prob- ably an over-estimation, but however highly one may esteem the discovery, the result of the rule of the men without property does not thrive much better with St. Simon than with Schiller, decried to-day as " a philistine. M The men without property in 1793 were only capable of fighting the battles of others. They could only 11 govern M as long as the terror lasted. When thought-out system of exchange," and in spite of this conviction, which has long been mine (it was already hinted at in the article on the Sozial politische Bedeutung von Raum und Zahl, but was to have been treated more thoroughly in a later article of the series, Problems of Socialism), he imagines that a social revolutionary government could in the present structure of industry "regulate" the whole of production and in half a year exterminate root and branch the capitalistic system that has grown up out of the production of com- modities with which it is so intimately bound up. One sees what sort of political children the force frenzy can make out of otherwise well-informed people.
it had exhausted itself, as it was bound to do, their government was quite at an end. Accord- ing to the Marx-Engels point of view, this danger would not exist with the modern prole- tariat. But what is the modern proletariat?
If one counts in it all persons without property, all those who have no income from property or from a privileged position, then they certainly form the absolute majority of the population of advanced countries. But this \ proletariat M would be a mixture of extraordinarily different elements, of classes which have more differences among themselves than had the " people " of 1789, who certainly as long as the present con- ditions of property are maintained have more common — or, at least, similar — interests than contrary ones; but the different nature of their needs and interests would quickly become known to them as soon as the propertied and governing classes are removed from, or deprived o^their position.
[On an earlier occasion I made the remark that the modern wage-earners are not of the homogeneous mass, devoid in an equal degree of property, family, etc., as the Communist Manifesto foresees; that it is just in the most advanced of the manufacturing industries that a whole hierarchy of differentiated workmen are to be found between whose groups only a moderate feeling of solidarity exists! In this re- mark, a well-known socialist writer, H. Cunow, sees a confirmation of the fact that even when I was speaking generally I had in my mind specially English conditions. In Germany and io4 the other continental civilised lands he says no such separation from the revolutionary move- ment of the workmen in better positions is to be found as in England. In contrast to England the best-paid workmen stand at the head of the class war. The English caste feeling, he adds, is not a consequence of the social differentiation of to-day but an after-effect of the earlier system of guilds and companies and the older trade union movement based on them.
Again I must reply that what my opponent tells me is in no way new to me. If a certain guild-like feature is to be found in the English working-class movement, it is far less a heritage from the old guild system, which, indeed, existed much longer in Germany than in England, than one of the chief products of Anglo-Saxon freedom — of the fact that the English workman never, not even at the time of the suppression of the right of association, stood under the scourge of a state ruled by police. The sense of individuality is developed in freedom, or, to speak for once with Stirner, the sense of own. It does not exclude the recognition of what is of a different nature and of general interest, but it easily becomes the cause of a little angu- larity which even appears as hard and narrow- minded when it is only one-sided in form. I do not want to wrong the German workmen, and I know how fully to honour the idealism which, for example, moved the Hamburg workmen for decades to sacrifices for the common cause of the proletarian struggle for freedom which have not their equal in the working-class moveio5 io5 ment; but so far as I have opportunity of knowing and following the German working- class movement, the reactions of the trade differentiation described have asserted them- selves. Special circumstances, such as the pre- ponderance of the political movement, the long artificial suppression of trade unions, and the fact that on the whole the differences in rates of wages and hours of labour are generally less in Germany than in England, prevent their manifesting themselves in a peculiarly striking manner. But any one who follows attentively the organs of the German trade union move- ment will come across enough facts to confirm what I have said.
The trade unions do not create that phenomenon, they only bring it into prominence as an unavoidable result of actual differences. It cannot be otherwise than that vital differences in manner of work and amount of income finally produce different conduct and demands of life. The highly-skilled fine instrument-maker and the collier, the skilled house decorator and the porter, the sculptor or modeller and the stoker, lead, as a rule, a very different kind j±f life and have very different kinds of wants. [Where the struggles for their standards of life lead to no collision between them, the fact that they are all wage-earners may efface these differences from their ideas, and the consciousness that they are carrying on the same kind of struggle against capital may produce a lively, mutual sympath^^ Such sympathy is not wanting in England; the most aristocratic of aristocratic io6 io6 trade unionists have often enough shown it to workmen in worse conditions, as many of them are very good democrats in politics, if they are not socialists.* But there is a great difference between such political or social political sym- pathy and economic solidarity which a stronger political and economic pressure may neutralise, but which, according as this pressure diminishes, will make itself finally noticeable in one way or another. It is a great mistake to assume that England makes an exception here on principle. The same phenomenon is shown in France in another form. Similarly L Switzerland, the United States, and, as I have said, to a certain degree in Germany also.
But even if we assume that this differentiation does not exist in the industrial working classes or that it exercises no effect on the mode of thinking of the workmen concerned, yet the industrial workers are everywhere the minority of the population. In Germany, together with industrial home-workers, some 7,000,000 out of 19,000,000 people earning incomes are indus- trial wage-earners. We have besides the technical civil service, the shop employees, the agricultural labourers.
Here the differentiation is everywhere more marked, of which no clearer evidence is given than the painful history of the movements towards the organisation of these classes of * In the socialistic movement in England, just as else- where, the better-paid — that is, the educated — workmen of higher mental endowment form the picked troops. One finds in the assemblies of socialist societies only very few so-called unskilled workmen.
io7 labour in industrial unions like trade unions.* It is quite impossible to say that the five or six millions employed in agriculture (which the German trade statistics register after deducting the higher staff of assistants, stewards, etc.) will strive to better themselves with the same force as the industrial workers.
Only with quite a small number can one propose or expect serious inclination for, and understanding of, endeavours which go beyond the mere amelioration of conditions of labour. To by far the greatest number of them the socialisation of agricultural production cannot be much more than empty words. Their ideal is in the meantime to get their own land.
Meanwhile, the desire of the industrial work- ing classes for socialistic production is for the most part more a matter of assumption than of certainty. From the growth of the number of socialist votes in public elections one can certainly deduce a steady increase of adherents of socialistic strivings, but no one would * In the ten years since this was written a very remarkable change for the better has taken place. The organisations of technological, commercial, etc., func- tionaries and assistants have made wonderful headway. At the end of 1907 there were, apart from the trade unions of the wage-earners, embracing altogether 24,000,000 members, 680,981 functionaries of all sorts and positions organised in forty-eight societies with trade union leanings more or less distinct. Of these fifteen societies, with altogether 459,787 members, were unions of office, shop, warehouse, etc., functionaries and assist- ants in commercial and kindred enterprises. On the other hand, there were only a few thousand agricultural labourers organised, and not the tenth part of the organ- ised clerks and shop assistants belonged to unions with socialist tendencies.
io8 io8 maintain that all votes given to socialists come from socialists. Even if we assumed that all these voters would greet with joy a revolution which brought the socialists to the helm, little would even then be done towards the solution of the main problem.
I think I can take it as being generally admitted that there would be no question of an immediate taking over by the state of the total manufacture and distribution of products. The state could not even take over the whole amount of medium and large enterprises. The local authorities, too, as connecting links, could not do so very much. They could socialise at most those businesses which produce, or which per- form services, locally for that locality, and they would get therewith quite a nice little task. But can one imagine that undertakings which until then had worked for the great outside market could be suddenly municipalised?