Part 2 — CHAPTER VIIIToC (continued 2)

Herr Duehring finds competition to be the stumbling block in the way of his comprehension. He cannot understand how competing entrepreneurs can manage to sell the entire product of labor including the surplus product for so much more than the natural cost of production. Here again that "force" of his which, in his estimation, is the very evil thing, comes into play. According to Marx, the surplus product does not have any cost of production, it is the part of the product which costs the capitalist nothing. If the entrepreneurs were to sell the surplus product at its real cost of production they would have to give it away. Is it not a fact that the competing entrepreneurs really sell the product of labor every day at its natural cost of production? According to Herr Duehring the cost of production consists "in the expenditure of labor or force and therefore in the last analysis must be measured by cost of maintenance," and therefore, in present day society, is to be estimated at the cost of the raw material, instruments of labor and actual wages paid in distinction to taxation, profit and compulsory raising of prices. It is well recognised that in modern society the competing entrepreneurs do not sell their wares at the natural cost of production but calculate on a profit and generally get it. This question which Herr Duehring fancies will level the walls of Marxism as the blast of Joshua did those of Jericho is a question which the economic doctrines of Duehring have to meet also.

"Capitalistic property," he says, "has no practical value and only realises itself because it implies the exercise of indirect power over man. The testimony to the existence of this force is capitalistic profit, and the amount of this latter depends upon the extent and intensity of the power of 'force.'... Capitalistic profit is a political and social institution which manifests itself very strongly as competition. The entrepreneurs take their stand on this relation and each one of them maintains his position. A certain amount of profit is a necessity of the dominant economic condition."

We know quite well that the entrepreneurs are in a position to sell the products of labor at a cost above the natural cost of production. Surely Herr Duehring does not think so meanly of his public as to hold the position that profit on capital stands above competition as the King of Prussia used to stand above the law. The proceeding by which the King of Prussia reached his position of superiority to the law we all know, the methods by which profit has come to be mightier than competition is just what Herr Duehring has to explain and what he stubbornly refuses to explain. It is no argument when he says that the entrepreneurs trade from this position and each one of them maintains his own place. If we take him at his word, how is it possible for a number of people each to be able to trade only on certain terms and yet each one of them to keep his position? The gildmen of the Middle Ages and the French nobility of 1789 operated from a decidedly superior position, and yet they came to grief. The Prussian army at Jena occupied an advantageous position and yet it had to abandon it and surrender piecemeal. It is not enough to tell us that a certain measure of profit is a necessary concomitant of domination in the economic sphere, it is necessary to tell us why. We do not get a step further by the statement of Duehring. "Capitalistic superiority is inseparable from landlordism. A portion of the peasantry is transformed in the cities into factory hands and in the final analysis into factory material. Profit appears as another form of rent." This is a mere assertion and only repeats what should have been explained and proved. We can come to no other conclusion, then, except that Herr Duehring does not like to tackle the answer to his own question how the capitalists are in a position to sell products of labor for more than the natural cost of production, in short Herr Duehring shirks an explanation of profit. He takes the only path open to him, a short cut, and simply declares that profit is the product of "force." This has been stated by Herr Duehring in his economic theory under the statement "force distributes." That is all very well; but the question still persists what does force distribute? There must be something to distribute otherwise force cannot distribute it. The profit which the competing capitalists pocket is something actual and tangible. Force may take but it cannot create. And if Herr Duehring still obstinately persists in his statement that "force" takes the profits for the entrepreneurs he is as silent as the grave as to whence it takes it. Where there is nothing the Kaiser, as all other "force," ceases to operate. From nothing comes nothing, particularly nothing in the shape of profits. If capitalistic private property has not practical actuality, and cannot realize itself, except by the exercise of indirect force over men, the question still persists, in the first place, how did the capitalist government come into possession of this "force" and in the second place how has this force been transformed into profits, and in the third place where does it get these profits?

(The remainder of this section is merely further elaboration of this idea with more caustic satire at the expense of the antagonist of Engels.)

IX. Natural Economic Laws—Ground Rent.

(In this chapter Engels proceeds to examine what Herr Duehring called the "fundamental laws" of his theory of economic science.)

Law No. I. "The productivity of economic instruments, natural resources and human force are capable of being increased by invention and discovery."

We are amazed. Herr Duehring treats us like that joke of Moliere on the parvenu who was informed that he had talked prose all his life without being aware of it. That inventions and discoveries increase the productive force of labor in many cases (but in many cases not, as the patent records everywhere show) we have been for a long time aware.

Law No. II. "Division of Labor. The formation of branches of work and the splitting up of activities increases the productivity of labor."

As far as this is true it is a mere commonplace since the time of Adam Smith. How far it is true will appear in the third division of this work.

Law No. III. "Distance and transportation are the most important causes of the advance or hindrance of the organization of productive forces."

Law No. IV. "The industrial state has incomparably greater capacity for population than the agricultural state."

Law No. V. "In economics only material interests count."

These are the natural laws on which Herr Duehring founds his new economics. He remains true to his philosophic methods.

(Hereupon Engels proceeds to the discussion of Duehring's opinions on ground-rent.)

Herr Duehring defines ground-rent as "that income which the landowner as such derives from ground and land." The economic idea of ground-rent, which Herr Duehring undertakes to explain to us, is transformed right away into the juristic concept so that we are no further than at first. He compares the leasing of a piece of land with the loan of capital to an entrepreneur but finds, as is so often the case, that the comparison will not hold. Then he says "to pursue the analogy the profit which remains to the lessee after the payment of ground-rent, answers to that portion of the profit on capital which remains to the entrepreneur who operates with borrowed capital after the interest on the borrowed capital has been paid."

(To these arguments Engels replies:)

The theory of ground-rent is a special English economic matter, and this of necessity because only in England does a mode of production exist by which rent is separated from profit and interest. In England there prevail the greater landlordism and the greater agriculture. The individual landlords lease their lands in great farms to lessees who are able to cultivate them in a capitalistic fashion and do not, like our peasants, work with their own hands, but employ laborers just like capitalistic entrepreneurs. We have here then the three classes of bourgeois society, and the income which each receives—the private landlord in the form of ground-rent, the capitalist in that of profit and the laborer in the form of wages. No English economist has ever regarded the profit of the lessee as Herr Duehring does and still less would he have to explain that the profit of the lessee is what it indubitably is, profit on capital. In England there is no use to discuss this question for the question as well as its answer are obvious from the facts and, since the time of Adam Smith, there has been no doubt at all about it.

The case in which the lessee cultivates his own land, as the rule in Germany, for the profit of the ground landlord does not make any difference in this respect. If the landlord cultivates the land for his own profit and furnishes the capital he puts the profit on capital in his pocket as well as the ground-rent for it cannot be otherwise under existing conditions. And if Herr Duehring thinks that rent is something different when the lessee cultivates the land for himself it is not so and only shows his ignorance of the matter.

For example:—

"The revenue derived from labor is called wages; that derived from stock by the person who manages or employs it is called profit. The revenue which proceeds from land is called rent and belongs altogether to the landlord. The revenue of the farmer is derived partly from his labor and partly from his stock.... When those three different sorts of labor belong to different persons they are readily distinguished, but when they belong to the same they are sometimes confounded with one another at least in common language. A gentleman who farms part of his own estate, after paying the expenses of cultivation, should gain both the rent of the landlord and the profit of the farmer. He is apt to denominate, however, his whole gain, profit, and thus confounds rent with profit, at least in common language. The greater part of our North American and West Indian planters are in this situation. They farm, the greater part of them, their own estates, and accordingly we seldom hear of the rent of a plantation but frequently of its profit.... A gardener who cultivates his own garden with his own hands, unites in his own person the three different characters of landlord, farmer, and laborer. His produce, therefore, should pay him the rent of the first, the profit of the second and the wages of the third. The whole, however, is commonly considered as the wages of his labor. Both rent and profit are in this case confounded with wages."

This passage is in the sixth chapter of the first book of Adam Smith. The case of the landholder who tills his own land has been examined a hundred years ago and the doubts which perplex Herr Duehring so much are caused entirely by his own ignorance.

X. With Respect to the "Critical History".

This which is the concluding portion of the Second Division of the work and which deals with Herr Duehring's estimates of economic writers is omitted as being of too limited and polemic a character for general interest.