Having thus 'employed' Marx's 'logical' version of Ricardo's theory of value, Vorontsov arrives at Sismondi's theory of crises which he adopts in as crude and simplified a form as possible. He believes, of course, that he is adopting the views of Rodbertus in reproducing those of Sismondi. 'The inductive method of research', he declares triumphantly, 'has resulted in the very same theory of crises and of pauperism which had been objectively stated by Rodbertus.'[285]

It is not quite clear what Vorontsov means by an 'inductive method of research' which he contrasts with the objective method--since all things are possible to Vorontsov, he may conceivably mean Marx's theory. Yet Rodbertus, too, was not to emerge unimproved from the hands of the original Russian thinker. Vorontsov corrects Rodbertus' theory merely in so far as he eliminates the stabilisation of the wage rate in accordance with the value of the aggregate product which, to Rodbertus, had been the pivot of his whole system. According to Vorontsov, this measure against crises is a mere palliative, since 'the immediate cause of the above phenomena (over-production, unemployment, etc.) is not that the working cla.s.ses receive too small a share of the national income, but that the capitalist cla.s.s cannot possibly consume all the products which every year fall to their share.'[286]

Yet, as soon as he has refuted Rodbertus' reform of the distribution of incomes, Vorontsov, with that 'strictly logical' consistency so peculiar to him, ultimately arrives at the following forecast for the future destiny of capitalism: 'If industrial organisation which prevails in W.

Europe is to prosper and flourish further still, it can only do so provided that some means will be found to destroy [_verbatim_--R. L.]

that portion of the national income which falls to the capitalists'

share over and above their capacity to consume. The simplest solution of this problem will be an appropriate change in the distribution of the aggregate income among those who take part in production. If the entrepreneurs would retain for themselves only so much of all increase of the national income as they need to satisfy all their whims and fancies, leaving the remainder to the working cla.s.s, the ma.s.s of the people, then the regime of capitalism would be a.s.sured for a long time to come.'[287]

The hash of Ricardo, Marx, Sismondi and Rodbertus thus is topped with the discovery that capitalist production could be radically cured of over-production, that it could 'prosper and flourish' in all eternity, if the capitalists would refrain from capitalising their surplus value and would make a free gift to the working cla.s.s of the corresponding part of the surplus value. Meanwhile the capitalists, until they have become sensible enough to accept Vorontsov's good advice, employ other means for the annual destruction of a part of their surplus value.

Modern militarism, amongst others, is one of these appropriate measures--and this precisely to the extent to which the bills of militarism are footed by the capitalists' income--for Vorontsov can be counted upon to turn things upside down--and not by the working ma.s.ses.

A primary remedy for capitalism, however, is foreign trade which again is a sore spot in Russian capitalism. As the last to arrive at the table of the world market, Russian capitalism fares worst in the compet.i.tion with older capitalist countries and thus lacks both prospects as to foreign markets and the most vital conditions of existence. Russia remains the 'country of peasants', a country of 'populist' production.

'If all this is correct,' Vorontsov concludes his essay on 'The Commodity Surplus in the Supply of the Market', 'then capitalism can play only a limited part in Russia. It must resign from the direction of agriculture, and its development in the industrial sphere must not inflict too many injuries upon the domestic industries which under our economic conditions are indispensable to the welfare of the majority of the population. If the reader would comment that capitalism might not accept such a compromise, our answer will be: so much the worse for capitalism.'

Thus Vorontsov ultimately washes his hands of the whole thing, declining for his part all responsibility for the further fortunes of economic development in Russia.

FOOTNOTES:

[277] An essay in _Patriotic Memoirs_, May 1883.

[278] An essay in the review _Russian Thought_, September 1889.

[279] A book published in 1893.

[280] A book published in 1895.

[281] _Patriotic Memoirs_, vol. v: 'A Contemporary Survey', p. 4.

[282] Ibid., p. 10.

[283] _Patriotic Memoirs_, vol. v: 'A Contemporary Survey', p. 14.

[284] _Outlines of Economic Theory_ (St. Petersburg, 1895), pp. 157 ff.

[285] 'Militarism and Capitalism' in _Russian Thought_ (1889), vol. ix, p. 78.

[286] 'Militarism and Capitalism' in _Russian Thought_ (1889), vol. ix, p. 80.

[287] Ibid., p. 83. Cf. _Outlines_, p. 196.

_CHAPTER XX_

NIKOLAYON

The second theorist of populist criticism, Nikolayon, brings quite a different economic training and knowledge to his work. One of the best-informed experts on Russian economic relations, he had already in 1880 attracted attention by his treatise on the capitalisation of agricultural incomes, which was published in the review _Slovo_.

Thirteen years later, spurred on by the great Russian famine of 1891, he pursued his inquiries further in a book ent.i.tled _Outlines of Our Social Economy Since the Reform_. Here he gives a detailed exposition, fully doc.u.mented by facts and figures, of how capitalism developed in Russia, and on this evidence proceeds to show that this development is the source of all evil, and so of the famine, also, so far as the Russian people are concerned. His views about the destiny of capitalism in Russia are grounded in a definite theory about the conditions of the development of capitalist production in general, and it is this with which we must now deal.

Since the market is of decisive importance for the capitalist mode of economy, every capitalist nation tries to make sure of as large a market as possible. In the first place, of course, it relies on its home market. But at a certain level of development, the home market is no longer sufficient for a capitalist nation, and this for the following reasons: all that social labour newly produces in one year can be divided into two parts--the share received by the workers in the form of wages, and that which is appropriated by the capitalists. Of the first part, only so many means of subsistence as correspond, in value, to the sum total of the wages paid within the country can be withdrawn from circulation. Yet capitalist economy decidedly tends to depress this part more and more. Its methods are a longer working day, stepping up the intensity of labour, and increasing output by technical improvements which enable the subst.i.tution of female and juvenile for male labour and in some cases displace adult labour altogether. Even if the wages of the workers still employed are rising, such increase can never equal the savings of the capitalists resulting from these changes. The result of all this is that the working cla.s.s must play an ever smaller part as buyers on the home market. At the same time, there is a further change: capitalist production gradually takes over even the trades which provided additional employment to an agricultural people; thus it deprives the peasants of their resources by degrees, so that the rural population can afford to buy fewer and fewer industrial products. This is a further reason for the continual contraction of the home market. As for the capitalist cla.s.s, we see that this latter is also unable to realise the entire newly created product, though for the opposite reason. However large the requirements of this cla.s.s, the capitalists will not be able to consume the entire surplus product in person. First, because part of it is needed to enlarge production, for technical improvements which, to the individual entrepreneur, will be a necessary condition of existence in a compet.i.tive society. Secondly, because an expanding capitalist production implies an expansion in those branches of industry which produce means of production (e.g. the mining industry, the machine industry and so forth) and whose products from the very beginning take a use-form that is incapable of personal consumption and can only function as capital. Thirdly and lastly, the higher labour productivity and capital savings that can be achieved by ma.s.s production of cheap commodities increasingly impel society towards ma.s.s production of commodities which cannot all be consumed by a mere handful of capitalists.

Although one capitalist can realise his surplus value in the surplus product of another capitalist and _vice versa_, this is only true for products of a certain branch, for consumer goods. However, the incentive of capitalist production is not the satisfaction of personal wants, and this is further shown by the progressive decline in the production of consumer as compared to that of producer goods.

'Thus we see that the aggregate product of a capitalist nation must greatly exceed the requirements of the whole industrial population employed, in the same way as each individual factory produces vastly in excess of the requirements of both its workers and the entrepreneur, and this is entirely due to the fact that the nation is a capitalist nation, because the distribution of resources within the society does not aim to satisfy the real wants of the population but only the effective demand. Just as an individual factory-owner could not maintain himself as a capitalist even for a day if his market were confined to the requirements of his workers and his own, so the home market of a developed capitalist nation must also be insufficient.'

At a certain level, capitalist development thus has the tendency to impede its own progress. These obstacles are ultimately due to the fact that progressive labour productivity, involving the severance of the immediate producer from the means of production, does not benefit society as a whole, but only the individual entrepreneur; and the ma.s.s of labour power and men-hours which has been 'set free' by this process becomes redundant and thus is not only lost to society but will become a burden to it. The real wants of the ma.s.ses can only be satisfied more fully in so far as there can be an ascendancy of a 'populist' mode of production based upon the union between the producer and his means of production. It is the aim of capitalism, however, to gain possession of just these spheres of production, and to destroy in the process the main factor which makes for its own prosperity. The periodical famines in India, for instance, recurring at intervals of ten or eleven years, were thus among the causes of periodical industrial crises in England. Any nation that sets out on capitalist development will sooner or later come up against these contradictions inherent in this mode of production. And the later a nation embarks on the capitalist venture, the more strongly will these contradictions make themselves felt, since, once the home market has been saturated, no subst.i.tute can be found, the outside market having already been conquered by the older competing countries.

The upshot of it all is that the limits of capitalism are set by the increasing poverty born of its own development, by the increasing number of redundant workers deficient in all purchasing power. Increasing labour productivity which can rapidly satisfy every effective demand of society corresponds to the increasing incapacity of ever broader ma.s.ses of the population to satisfy their most vital needs; on the one hand, a glut of goods that cannot be sold--and on the other, large ma.s.ses who lack the bare necessities.

These are Nikolayon's general views.[288] He knows his Marx, we see, and has turned the two first volumes of _Capital_ to excellent use. And still, the whole trend of his argument is genuinely Sismondian. It is capitalism itself which brings about a shrinking home market since it impoverishes the ma.s.ses; every calamity of modern society is due to the destruction of the 'populist' mode of production, that is to say the destruction of small-scale enterprise. That is his main theme. More openly even than Sismondi, Nikolayon sets the tenor of his critique by an apotheosis of small-scale enterprise, this sole approach to grace.[289] The aggregate capitalist product cannot, in the end, be realised within the society, this can only be done with recourse to outside markets. Nikolayon here comes to the same conclusion as Vorontsov, in spite of a quite different theoretical point of departure.

Applied to Russia, it is the economic scientific ground for a sceptical att.i.tude towards capitalism. Capitalist development in Russia has been without access to foreign markets from the first, it could only show its worst aspects--it has impoverished the ma.s.ses of the people. In consequence, it was a 'fatal mistake' to promote capitalism in Russia.

On this point, Nikolayon fulminates like a prophet of the Old Testament: 'Instead of keeping to the tradition of centuries, instead of developing our old inherited principle of a close connection between the immediate producer and his means of production, instead of usefully applying the scientific achievements of W. Europe to their forms of production based on the peasants' ownership of their means of production, instead of increasing their productivity by concentrating the means of production in their hands, instead of benefiting, not by the forms of production in W. Europe, but by its organisation, its powerful co-operation, its division of labour, its machinery, etc., etc.--instead of developing the fundamental principle of a landowning peasantry and applying it to the cultivation of the land by the peasants, instead of making science and its application widely accessible to the peasants--instead of all this, we have taken the opposite turning. We have failed to prevent the development of capitalist forms of production, although they are based on the expropriation of the peasants; on the contrary, we have promoted with all our might the upsetting of our entire economic life which resulted in the famine of 1891.'

Though the evil is much advanced, it is not too late even now to retrace our steps. On the contrary, a complete reform of economic policy is just as urgently needed for Russia in view of the threatening proletarisation and collapse, as Alexander's reforms after the Crimean war were necessary in their time.

Now a social reform as advocated by Nikolayon is completely Utopian. His att.i.tude exhibits an even more blatant petty-bourgeois and reactionary bias than Sismondi's ever did, considering that the Russian 'populist'

writes after a lapse of seventy years. For in his opinion, the old _obshchina_, the rural community founded on the communal ownership of the soil, is the raft to deliver Russia from the flood of capitalism. On it, the discoveries of modern big industry and scientific technique are to be grafted by measures which remain his own secret--so that it can serve as the basis of a 'socialised' higher form of production. Russia can choose no other alternative: either she turns her back upon capitalist development, or she must resign herself to death and decay.[290]

After a crushing criticism of capitalism Nikolayon thus ends up with the same old 'populist' panacea which had as early as the fifties, though at that time with greater justification, been hailed as the 'peculiarly Russian' guarantee of a higher social development, although its reactionary character as a lifeless relic of ancient inst.i.tutions had been exposed in Engels' _Fluechtlingsliteratur_ in _Volksstaat_ (1875).

Engels wrote at the time:

'A further development of Russia on bourgeois lines would gradually destroy communal property there too, quite apart from any interference of the Russian government "with the knout and with bayonets" (as the revolutionary populists imagined). Under the pressure of taxes and usury, communal landownership is no longer a privilege, it becomes an irksome chain. The peasants frequently run away from it, either with or without their families, to seek their living as itinerant labourers, and leave the land behind. We see that communal ownership in Russia has long since pa.s.sed its flower and there is every indication that its decay is approaching.'

With these words, Engels. .h.i.ts right on the target of the _obshchina_ problem--eighteen years before the publication of Nikolayon's princ.i.p.al work. If Nikolayon subsequently with renewed courage again conjured up the ghost of the _obshchina_, it was a bad historical anachronism inasmuch as about a decade later the _obshchina_ was given an official burial by the state. The absolutist government which had for financial reasons tried during half a century artificially to keep the machinery of the rural community going was compelled to give up this thankless task on its own accord. The agrarian problem soon made it clear how far the old 'populist' delusion was lagging behind the actual course of economic events, and conversely, how powerfully capitalist development in Russia, mourned and cursed as still-born, could demonstrate with lightning and thunder its capacity to live and to multiply. Once again, and for the last time, this turn of events demonstrates in quite a different historical setting how a social critique of capitalism, which begins by doubting its capacity for development, must by a deadly logic lead to a reactionary Utopianism--both in the France of 1819 and in the Russia of 1893.[291]

FOOTNOTES:

[288] Cf. _Outlines of Our Social Economy_, in particular pp. 202-5, 338-41.

[289] Vladimir Ilyich [Lenin] has given detailed proof of the striking similarity between the position of the Russian 'populists' and the views of Sismondi in his essay _On the Characteristics of Economic Romanticism_ (1897).

[290] _Outlines of Our Social Economy_, p. 322. Friedrich Engels appraises the Russian situation differently. He repeatedly tries to convince Nikolayon that Russia cannot avoid a high industrial development, and that her sufferings are nothing but the typical capitalist contradictions. Thus he writes on September 22, 1892: 'I therefore hold that at present industrial production necessarily implies big industry, making use of steam power, electricity, mechanical looms and frames, and lastly the manufacture of the machines themselves by mechanical means. From the moment that railways are introduced in Russia, recourse to all these extremely modern means of production becomes inevitable. It is necessary that you should be able to mend and repair your engines, coaches, railways and the like, but to do this cheaply, you must also be in a position to make at home the things needing repair. As soon as the technique of war has become a branch of industry (armour-plated cruisers, modern artillery, machine guns, steel bullets, smokeless gun powder, etc.) a big industry that is indispensable for the production of such items has become a political necessity for you as well. All these items cannot be made without a highly developed metal industry which on its part cannot develop unless there is a corresponding development of all other branches of production, textiles in particular' (Marx-Engels to Nikolayon, St.

Petersburg, 1908, p. 75). And further in the same letter: 'So long as Russian industry depends on the home market alone, it can only satisfy the internal demand. The latter, however, can grow but slowly, and it seems to me that under present conditions of life in Russia it is even bound to decrease, since it is one of the unavoidable consequences of high industrial development that it destroys its own home market by the same process which served to create it: by destroying the bases of the peasants' domestic industry. Yet peasants cannot live without such a domestic industry. They are ruined as peasants, their purchasing power is reduced to a minimum, and unless they grow new roots in new conditions of life, unless they become proletarians, they will only represent a very small market for the newly arising plants and factories.

'Capitalist production is a phase of economic transition, full of inherent contradictions which only develop and become visible to the extent that capitalist production develops. The tendency of simultaneously creating and destroying a market is just one of these contradictions. Another is the hopeless situation that will ensue, all the sooner in a country like Russia which lacks external markets than in countries more or less fit to compete in the open world market. These latter can find some means of relief in this seemingly hopeless situation by heroic measures of commercial policy, that is to say by forcibly opening up new markets. China is the most recent market to be opened up for English commerce, and it proved adequate for a temporary revival of prosperity. That is why English capital is so insistent on railroad building in China. Yet railways in China mean the destruction of the entire foundation of China's small rural enterprises and her domestic industry. In this case, there is not even a native big industry developed to compensate for this evil to some extent, and hundreds of millions will consequently find it impossible to make a living at all.

The result will be ma.s.s emigration, such as the world has never yet seen, and America, Asia and Europe will be flooded with the detested Chinese. This new compet.i.tor on the labour market will compete with American, Australian and European labour at the level of what the Chinese consider a satisfactory standard of living, which is well known to be the lowest in the whole world. Well then, if the whole system of production in Europe has not been revolutionised by then, that will be the time to start this revolution' (ibid., p. 79).

Engels, though he followed Russian developments with attention and keen interest, persistently refused to take an active part in the Russian dispute. In his letter of November 24, 1894, i.e. shortly before his death, he expressed himself as follows: 'My Russian friends almost daily and weekly bombard me with requests to come forward with my objections to Russian books and reviews which not only misinterpret but even misquote the sayings of our author (Marx). My friends a.s.sure me that my intervention would suffice to put matters right. Yet I invariably and firmly refuse all such proposals because I cannot afford to become involved with a dispute held in a foreign country, in a tongue which I, at least, cannot read as easily and freely as the more familiar W.

European languages, and in a literature which is at best accessible to me only in fortuitous glimpses of some fragments, and which I cannot pursue anything like systematically enough in all its stages and details without neglecting my real and serious work. There are people everywhere who, once they have taken up a certain stand, are not ashamed to have recourse to misinterpreting the thoughts of others and to all kinds of dishonest manipulations for their own ends, and if that is what has happened to our author, I am afraid they will not deal more kindly with me, so that in the end I shall be compelled to interfere in the dispute, first to defend others, and then in my own defence' (ibid., p. 90).

[291] We might mention that the surviving champions of 'populist'

pessimism, and Vorontsov in particular, to the last remained loyal to their views, in spite of all that happened in Russia--a fact that does more credit to their character than to their intelligence. Referring to the 1900 and 1902 crises, Vorontsov wrote in 1902: 'The doctrinaire dogma of the Neo-Marxists rapidly loses its power over people's minds.

That the newest successes of the individualists are ephemeral has obviously dawned even on their official advocates.... In the first decade of the twentieth century, we come back to the same views about economic development in Russia that had been the legacy of the 1870's'

(Cf. the review _Political Economics_, October 1902, quoted by A. Finn Yenotayevski in _The Contemporary Economy of Russia 1890-1910_, St.

Petersburg, 1911, p. 2.) Even to-day, then, this last of the 'populist'

Mohicans deduces the 'ephemeral character', not of his own theory, but of economic reality. What of the saying of Barrere: 'Il n'y a que les morts qui ne reviennent pas'.