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Socialistic Theories: Socialistic Fallacies, Part Two

Proudhon “proclaims the end of the ‘government of man by man’ and of the ‘exploitation of man by man.’ Does he desire that man should be governed by apes?”

Editor’s Note

In the second book from Socialistic Theories, Yves Guyot detailed the thinking of two significant pre-Marxist socialists, Henri de Saint-Simon (1760-1825) and Pierre-Joseph Proudhon (1809-1865). Together, they were the best representatives of French socialist thinking before Marx, and their legacies loomed large in trans-Atlantic communist circles. Both men were romantics of a sort—they truly felt the pains of their fellow creatures and desperately yearned for a better world than the one history had to offer us. Yet, as Guyot mercilessly details throughout the book, Saint-Simon and Proudhon were profoundly misguided in their view of how the world actually worked. By the 19th century, most reasonable parties could agree that Utopia was unattainable, but if socialism offered the same old dish warmed over, should not reasonable people dispense with it already? The early socialists—including Marx—were indeed utopians in their vision, but they were nonetheless convinced that the empirical facts of history and economics prognosticated the rise of a significant ideological challenge to industrial or corporate capitalism. As we will find in a later number, Marx and the German socialists sharply distanced themselves from their French precursors, arguing that utopianism had absolutely no place in the empirical study of socialism. With this careful, tactical academic move, the German Marxists were able to simultaneously assert that history proved capitalism would fall to socialism and that every previous example of socialism in action was really no socialism at all. The Utopians were wiped from the burden of evidence against the socialists, and their body count reset to zero.

Anthony Comegna, PhD
Assistant Editor for Intellectual History

Socialistic Fallacies

By Yves Guyot. New York: The MacMillan Company. 1910. 73-101 (Excerpts).

Book II. Socialistic Theories.

Chapter I: Saint Simon

Let us pass from these monotonous Utopias, condemned as they are by experiences which are as constant as they are cruel. There now appear the Socialists with scientific pretensions, of whom France presents a lavish supply. Why then should we scorn them? Are they not French formulae which we find at the root of all these recent foreign conceptions? “The land belongs to no one and its fruits to all,” says Rousseau in 1753. Are the rules of Morelly’s “Code de la Nature” so far removed from actual schemes?

The works of Saint Simon from 1808 to 1825 disclose a strange medley of religious survivals, scientific aspirations, and profound insight into the future. He adopts the old conception of Gregory VII by proposing to organize two powers, the one spiritual, composed of the philosophers and artists, the other temporal, but this temporal power must be devoted to industry, so that when Le Play at a later date proposes to constitute the industrial chiefs the “authorities of society,” he is adopting Saint Simon’s idea in another form.

Saint Simon divided the nation into two parts, a national and an anti-national. The former is composed of those who perform useful labour, direct this labour or employ their capital in it. The anti-national party is composed of those who consume but do not produce, of those whose labour is not useful, and of those who profess political principles which are inimical to production. It follows that the anti-national part must be eliminated from the performance of the public functions of government, and that part of the nation must be placed at its head which produces its wealth and its greatness.

He set forth this conception in 1819, in the famous parable which involved him in a prosecution and an acquittal at the assizes. He says, “We assume that France suddenly loses her fifty best physicists, her fifty best chemists, etc., her fifty best engineers, her fifty best physicians, her fifty best bankers, her two hundred best merchants, her fifty best iron masters, etc., her fifty best masons, her fifty best carpenters, etc. Let us admit that France retains all the men of genius whom she possesses, but that she has the misfortune to lose Monsieur, the brother of His Majesty and the Duc d’Angouleme, and that she also loses all the great officers of the Crown, all the ministers of State, all the councilors of State, all the prefects, judges, etc.”

Saint Simon made no account of the intangible results ensured by a good minister, a good administrator, and a good magistrate. Were they to disappear we should find ourselves in a condition of anarchy which would compromise or destroy the action and the labours of the fifty men of genius whom Saint Simon has enumerated.

The essential element which it is necessary to recognize in this conception is the protest against the preponderant part played by noblemen, soldiers, and prelates in public affairs. He knew that the further we advanced, the more the centre of gravity of power would shift, but by a strange lack of political perception he aims at creating a parliament, representative in its character, composed of industrial chiefs, and despite the experience of the past, he imagines that these industrial chiefs will refrain from making their respective interests prevail to the detriment of the general interest. There is a true as well as a false side to his motto of “Everything for industry,” true because he foresaw that a civilization on a competitive basis would become increasingly productive, false because he made of industry an end in itself. He only saw the producer and forgot that without the consumer the producer has no raison d’etre. In his political conception he had no doubt that if he invested the producers with all the powers of government, they would abuse them. How then did he fail to perceive that he was constituting a new caste, a privileged order, to the particular detriment of the most numerous and the most needy?

He defined politics as the “science of production,” but at the same time he said “Government is always injurious to industry when it interferes with the progress of events, even when it attempts to encourage it; whence it follows that Governments should limit their efforts to the preservation of industry from every kind of trouble and interference.” Why then found the industrial parliament, the scheme of which he has set out in “l’Organisateur.”

It is true that in Saint Simon’s conception the sole function of government is to execute the decrees of a consciously formed opinion. He recites the following parable: The caravan says lead us where we shall be happiest, or it says lead us to Mecca. In the former case it relies on its leader, in the latter it clearly indicates its wishes to him, and thereby acquires the right to control the directions which he gives. It is clear that opinion can have no effective and useful action upon public affairs, unless it has a definite object.

Saint Simon merely followed after the philosophers of the eighteenth century, and repeated Condorcet’s words, when he said that the golden age is before and not behind us. But he overburdened his economic forecasts with religious aspirations. In his “Nouveau Christianisme” (1825) he repeated the precept of Christ, “Love one another; love they neighbor as thyself.” But the tradition of the Church is otherwise. He substitutes the declaration that “the best theologian is he who makes the most general applications of the fundamental principle of divine morality, to the effect that he is the true Pope and speaks in the name of God.” Thus inspired he asserts, “that it is the duty of religion to direct society to the great end of ameliorating as rapidly as possible the lot of the poorest class. Except for the word “religion” and for the substitution of “the poorest class” for “the greatest number,” this formula is that which Priestley and Bentham borrowed from the materialist Helvetius.

Saint Simon denounces the exploitation of man by man. “The way to grow rich is to make others work for one.” The State is to be the sole recipient of the instruments of labour, of land, and of capital, and is to apportion them so that they may be utilized in common and distributed in accordance with his hierarchical system; to each according to his capacity, to each capacity according to its works. The “Globe,” which became the organ of Saint Simon’s disciples, bore among its mottoes, “All privileges of birth are abolished.” A central bank is to regulate production and to prevent over-production and want. We arrive, therefore, at a condition of complete nationalization as well as of complete sacerdotalism.

Saint Simon’s disciples tried to christianise industry. Enfantin believed that he had power to fascinate the judges by his look, and considered himself an incarnation. “I am the departed Saint Simon, living and being, past, present, and future, that Saint Simon who, eternally progressive, is now manifest by the name of Enfantin. It is by me and in me, that Saint Simon asserts himself a God.” Saint Simonism ends in the priestly couple, man and woman, the confused conception of whom lends itself to all kinds of interpretations. With the establishment of Menilmontant it was to bury itself in ridicule. Nevertheless, the majority of its inmates approved themselves as practical men in after life and achieved brilliant careers in industry and finance.

Saint Simon had applied to Napoleon and afterwards to Louis XVIII. Enfantin and Bayard asked Lafayette to take the dictatorship. After the Coup d’Etat of December 2nd, they nearly all became ardent Bonapartists; they never had any conception of political liberty, and were always full of the retrograde notion of class distinctions. After the insurrection of Lyons, the “Globe” said, “The lower orders cannot raise themselves except so far as the upper classes give them a hand; it is from the latter that the initiative must come.” And they adopted State socialism by talking of assuring pensions for the workers and procuring capital for them through the State bank. The fundamental fallacy of Saint Simon lies in these class politics, which elevate the industrial chiefs into a dominant class, a conception which Count Jaubert adopted in 1836, when he said: “No society can do without an aristocracy; shall I tell you what is the aristocracy of the Government of July? It is that of the great industrial chiefs and manufacturers. These are the feudatories of the new dynasty.” Strange! The object of the Revolution of 1789 was to destroy feudalism, and here is a new feudalism proclaiming itself and withholding all politics rights through the franchise. These barons of industry exploit the serfs of industry who are the true producers. Such is the simple genesis of the democratic and revolutionary conceptions of socialism from 1830 to 1848.

Chapter VI. Proudhon’s Theories

Proudhon was born at Besancon, his father being a brewer’s cooper. He became a working compositor, and as such he read the “Fathers of the Church,” and was initiated into Hegel’s dialectics, by M. Chas. Grun, “a German professor of philosophy, who understood nothing of what he taught,” according to Karl Marx. Becoming acquainted later in life with the science of economics, he brought to it the methods of scholasticism, and attempted by running his head against words to cause the lightning to burst forth. He was incapable of giving clear expression to his thoughts, and sought to astonish the Philistines by his answer to the question propounded in the title of his work, published in 1840, “What is property? Property is theft.” This had not even the merit of originality. Brissot de Warville in his “Recherches philosophiques sur le droit de propriete et le vol” (1780), had said “private property is a theft as against nature. Its owner is a thief.” On this point Proudhon’s doctrine is summarized in these two propositions: (1) The right to possess is the same for all; (2) Man can only work with the help of the instruments of labour. It follows that, all men having the right to work, they have an equal right to the instruments of work. Therefore (3) these instruments cannot become the object of private property. But in “La Theorie de la Propriete” (published after his death in 1866) he says: “Property, if one appreciates its origins, is a principle inherently vicious an anti-social, but destined to become by its own general distribution and the joint action of other institutions, the pivot and mainspring of the social system.”

In “Qu’est ce que la propriete?” (1840) he put forward this further idea, which is in singular contradiction with the other. “The worker preserves a natural right of property over the thing which he has produced, even after the receipt of his wages.” That is to say that the tradesman who has sold an apple to a purchaser preserves his right to his goods even after they have been consumed. Nevertheless, it is clear that the workman receives wages in exchange for a product or a service, and once the product has been delivered, the service rendered, and the wages received, the contract has been fully executed, and all obligations thereunder fulfilled.

Proudhon, possibly under the influence of Robertus, denounces property as rendering impossible the redemption of his produce by the workman. If twenty millions of workmen have provided products of a value of twenty millions of francs they are obliged to buy them for twenty-five millions. The workers who ought to have bought these products in order to live, are obliged to pay five francs for what they have bought for four. “They have to fast one day in five.” Workmen who are members of co-operative societies have learned the lesson that they cannot redeem what they have themselves produced at the price which was paid for it. There has to be added so much per cent upon the original article, necessary to cover general expenses and profit, to compensate unfavourable purchases by the profit derived from purchases effected under favourable conditions, interest and depreciation of capital, commission paid to salesmen, discounts to retail merchants, interest upon capital from the time of manufacture to the time of sale, insurance, etc. Nevertheless, recent writers, such as Gronlund, Hetzka and Hobson, have sought to show that this system is the cause of universal over-production.

Proudhon’s “Contradictions Economiques” are a mere congeries of digressions, in which he discusses everything under the pretence of applying Hegel’s antinomies. In fact, he bases his book entirely upon the conflict set up by J. B. Say between useful and exchangeable value. Necessary as they are to one another, they stand to one another in an inverse ratio. In proportion as the production of utility increases, its value diminishes, Proudhon added that this contradiction is necessary. Accordingly, the more the nations work, the poorer they become. And he added the words, “The philosophy of misery” as the subtitle of his work. I have explained in my book “La Science Economique” how this problem is stated and have given the following solution:—The criterion of economic progress is the absolute and relative increase in the value of fixed capital, the decrease in the value of the units of circulating capital, and the increase in their total value.

Proudhon concludes his book by pointing out the existing confusion between his conceptions when he says that the object of economic science is “justice.” In order to establish this he is obliged to include in a “general equation” all his economic contradictions. “My philosopher’s stone,” he says, “is gratuitous credit and the abolition of money.” As against various parties, he sets up two, the party of labour and the party of capital. This is the struggle of classes, the conception of which he develops in his book “De la capacite des classes ouvrieres.” (1863).

Proudhon adopts the assertion of Helvetius, that the capacity of all human beings is equal and is differentiated merely by the circumstances of education and environment. The value of each man’s labour at the same time is, therefore, the same, and the proper amount of wages should be the amount of the total produce divided by the number of workers.

He proclaims the end of the “government of man by man” and of the “exploitation of man by man.” Does he desire that man should be governed by apes? He is often, in fact, governed by women, by children, and by his own passions. He is not exploited only by man; he is exploited by all the forces of nature over which it is his duty to triumph, by microbes and insects against which he has so much difficulty in defending himself, and, above all, by his prejudices and by the charlatans who know how to use them to their own advantage. Proudhon behaves like a man who beats a big drum in order to attract children, when he employs the antithesis of which he has already made use as regards property, and exclaims that “anarchy is the true form of government.” And he is careful, in order to complete the confusion of the thoughtless, to explain the etymology of the word “anarchy” as meaning the absence or negation of government. He then develops his theme by repeating an idea of St. Simon’s. “The science of government rightly pertains to a section of the Academy of Sciences, and inasmuch as every citizen may send a thesis to the Academy, every citizen is a legislator. The people constitutes the guardian of the law, the people constitutes the executive power.” In another work he adds to this quibble the declaration that “the workshop will cause government to disappear.”

There reappears in this declaration a conception of the ancient guild or corporation as an autonomous, exclusive body, opposed to everything which is not itself and to all general interests. He concludes with his romance of the “federative pact,” and imagines that he can, by unrehearsed effect, transform France by subdividing it into thirty-six sovereignties of a mean extent of 6,000 square kilometres, each with a million of inhabitants. He did not condescend to observe that a federation is a grouping of independent states; when a centralized state is subdivided, the operation is the exact opposite of federation; the proper name for it is dismemberment and its consequence dissolution.

He virulently attacked Louis Blanc’s childish ideas on “labour as a point of honour,” Fourier’s on the phalanstery and Cabet’s on fraternity, yet he employs their vocabulary against the exploitation of man by man, he demands the confiscation of the instruments of labour and their delivery to the workers; he desires the abolition of competition and, while proclaiming himself as an anarchist, he appeals to the State to realise his conceptions. However hostile they may be to one another, all the Utopians of 1848 present a family resemblance, they are all obscure and declamatory, pin their faith to empty and sonorous phrases, and disregard actual facts.

Chapter VII. Proudhon’s Proposed Decrees and the Bank of Exchange.

Proudhon was frank enough to express his dissatisfaction with the Revolution of 1848, which disquieted more than it pleased the various Socialists who were called upon to put their ideas into practice. Proudhon called upon the State to publish the following decrees.

The Government is to decree that “direct exchange, without specie or interest, is derived from natural law and public utility; the Bank shall add to its functions that of a Bank of Exchange, and fix the rate of discount at one per cent.”

A second decree was to provide that “whereas the law ought to be the same for all, funded stocks paid by the State shall be converted into one per cent stock until they are finally redeemed.”

By a third decree the interest on mortgages is reduced to one per cent. “The execution of the present decree in entrusted to those citizens who are burdened with mortgages.”

A fifth decree reduces the interest and dividend of limited companies to one per cent. A sixth fixes house rent at the same figure. A seventh reduces rents by twenty-five per cent calculated upon the average of the twenty last preceding years; the value of the properties assessed to be calculated by taking the rent allowed at x per cent of the capital; when by the accumulation of annual payments the owner has recovered the value of his estate with a premium of twenty per cent by way of an indemnity, the property is to revert to the central agricultural society which is charged with the organization of agriculture. “All land not under cultivation is to revert to the State.” Other decrees effect the reduction of salaries for Government salaries. By the twelfth decree, “After determining the debit of each citizen by the assessment of salaries and wages, his credit is to be determined by an assessment of the price of commodities.”

On January 31st, 1849, Proudhon founded the Banque du Peuple upon the following principles: All raw material is supplied to man gratuitously by nature; in the economic system all production is derived from labour, and correspondingly all capital in unproductive; inasmuch as every combination of credit resolves itself into an exchange, the productiveness of capital and the discount of values cannot and ought not to give rise to any interest. The object of the Bank was to organize credit on a democratic basis: (1) by obtaining for all, at the lowest price and under the best possible conditions, the use of the land, of houses, machinery, instruments of labour, capital, produce and services of every kind; (2) by providing for all an outlet for their production and the application of their labour under the most advantageous conditions. The capital of the Bank was five millions of francs, divided into a million shares of five francs each, but liable to pay interest. Unlike ordinary drafts payable to order and in cash, the circulating medium of the Banque du Peuple was a delivery order clothed with a socialistic character and payable at sight by every member or customer in the products or services of his industry or calling. Settlement for purchases and sales between the different customers was to be by the reciprocal exchanges of their products and services and was to be effected by means of paper issued by the Bank, styled “Circulation tickets.” (Bon de circulation).

The Bank never commenced business. Proudhon having been prosecuted for two articles published in the “Peuple,” and sentenced to a term of three years’ imprisonment, fled to Belgium. He was able to say that, as his Bank was not put into operation, its principle remained valid, but he made no attempt to realise it later, which was disappointing from the experimental point of view. He would then have discovered that the abolition of money would not have contributed to facilitate exchange, and that by refusing to remunerate the giving of credit he would have failed to obtain it. Attempts to establish exchanges of this kind were made for fifteen years, and failed miserably.

Proudhon’s inspiration exercised some influence upon the Paris Commune. The manifesto of April 19th, 1871, was composed of more or less heterogenous extracts from his works. According to M. Bourguin there are still some of his disciples among the French Socialists, and something of his ideas is to be found in the working programme of the General Confederation of Labour, which sets up the trade union in opposition to the State, and expects to effect the triumph of the pretensions of each group at the expense of the general interest.

In 1848 Proudhon made a violent attack upon universal suffrage to which the supporters of trade unions plainly oppose the struggle between various organisations, but without losing themselves, as Proudhon did, in digressions for the purpose of justifying their right to adopt this attitude. Proudhon’s schemes were caprices rather than ideas. These he tried to co-ordinate, and when he failed he sought to throw the responsibility for his failure upon the intelligence of his fellow citizens.

I once had some conversations with Colonel Langlois, who claimed to be the true disciple of Proudhon, and I have several times heard him say with pride, when speaking of one or other of Proudhon’s works, “No one but myself has understood him.”

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