Objections to Friedrich List

G. Objections to Friedrich List

An incomplete draft of an article written by Marx in Brussels (1845) – discovered in 1971 – against the German protectionist economist Friedrich List (1841) carries us a step further in our quest to define Marx’s starting point. As a preliminary, we note Marx’s defense of Smith, Say, and Sismondi against List’s aspersions. Thus he rejected the suggestion that Smith ordered his manuscripts burned in order to hide the insincerity of his free-trade teaching, fearing that it would become manifest that his object had been the national not the international interest (MECW 4 : 268– 9). The charge that Say supported free trade “because his factory was ruined by the Continental System” and “because Napoleon drove him out of the Tribunate,” was a falsification based on distorted readings of various authors designed “to discredit” Say (269–70). And List “reache[d] the height of infamy” by representing Sismondi as recommending that “the spirit of inventiveness . . . be curbed and bridled”; for Sismondi was arguing not against machinery but against the private- property system and competition, particularly the distorted distribution pattern inherent therein (Sismondi 1827 2 : 433, cited 272).

In stating the case against List’s protectionism Marx applies the standard argu- ment that it entails a sacrifice of real income: “ . . . protective tariffs demand a sacrifice of exchange values from the consumers (chiefly from the workers who are to be superseded by machines, from all those who draw a fixed income, such as offi- cials, recipients of land rent, etc.)” (275). He adds that “the industrial bourgeois” – the beneficiary – “has therefore to prove that, far from hankering after material goods, he wants nothing else but the sacrifice of exchange values, material goods, for a spiritual essence.” (The “supercession” of labor by machines, presumably refers to the ultimate purpose of protection, which is domestic industrialization.) The last remark reflects Marx’s disdain for the priority accorded “productive force” by List – its character of “inner essence” (284). Contemporary political economy, quite rightly for Marx, made no such distinction; whereas List’s protectionist case to surrender exchange value for “productive force” was reinforced thereby: “the supernatural world of forces takes the place of the material world of exchange values;” and the protectionists could “very well demand of the German people that it should sacrifice the bad exchange values for phantoms!” 31

31 Marx does not object to the recognition and analysis of the processes entailing man’s control “of his own forces and the forces of nature” – evidently referring to economic development –

provided “one’s standpoint is not from within the industrial epoch, but above it” (MECW 4 : 281); for then the place of the contemporary mode of production in world historical development is properly recognized and so too is the inevitable conclusion “that the hour has come . . . for the abolition of the material and social conditions in which mankind has had to

189 The rejection of the notion of “inner essence” is of interest considering Marx’s

G. Objections to Friedrich List

later methodological position. And it is clear that in playing down the “mystical radiance” allegedly attached to productive force, Marx gives no hint of that special character of “labor-power” as source of surplus to emerge later: “In order to destroy the mystical radiance which transfigures ‘productive force,’ one has only to consult any book of statistics. There one reads about water-power, steam-power, manpower, horse-power. All these are ‘productive forces.’ Is it a high appreciation of man for him to figure as a ‘force’ alongside horses, steam and water?. . . . It is a fine recogni- tion of man that degrades him to a ‘force’ capable of creating wealth!” (285–6). 32

We turn next to rent. Marx correctly represents the Ricardian theory as reflecting growing land scarcity under conditions of expanding population and demand for food, with allowance for an intensive as well as extensive margin. The account posits Ricardo’s position that “[l]and rent adds nothing to the productivity of land. On the contrary, rising land rent is proof that the productive force of land is falling” (290). Specifically: “The price of grain is determined by the cost of production on the least fertile land that has to be cultivated because of the needs of the population. If land of a poorer quality has to be resorted to, or if amounts of capital have to be applied with a lesser yield to the same piece of land, then the owner of the most fertile land sells his product as dearly as the peasant who has the worst. He pockets the difference between the cost of production on the best land and that on the most infertile.” But Marx goes further when, in an overview of early nineteenth-century industrial development, he emphasizes as his own position its impact on population growth independently of domestic land resources: “It is in the nature of modern factory industry, firstly, to estrange industry from the native soil since it processes mainly raw materials from abroad and bases itself on foreign trade. It is in the nature of this industry [secondly] to cause the population to grow in a ratio which, under the system of private property, does not correspond to the exploitation of the soil” (289).

We also find a statement of the Ricardian growth model, superior to those of the previous year (above, p. 185), involving rising money wages, though falling real wages, and accordingly a falling general profit rate : “These higher grain prices – since the worker always consumes a certain amount of grain, however dear it may be, and therefore his nominal wage increases even when in reality it decreases – must be

deducted from the profits of Messrs. the industrialists” (286). 33 Thus, even where there is scope for a real-wage decline the profit rate falls nonetheless. But there is a

develop its abilities as a slave.” But List “remains within the present system, who desires only to raise it to a level which it has not yet reached in his own country, and who looks with greedy envy on another nation that has reached this level . . . ” (282). 32 Marx’s point is that labor is classified as a “productive force” even if physically and mentally deformed. 33 The decrease in the real wage with a constant corn wage implies a mixed wage basket. Marx emphasizes the drastic fall in farm wages since 1815, despite which (and despite the protective Corn Laws) agriculture remained depressed (MECW 4 : 288–9).

Marx’s Economics 1843–1845

limit to the decline – beyond which point the inverse relation still applies should the corn price increase: “Ricardo is wise enough to assume that wages cannot be depressed further. Hence, when there is a rise in the price of grain, there follows

a reduction in profits and an increase in wages, without the latter increasing in reality” (286–7). 34 The transfer to landowners and the policy implications are then elaborated thus, all in opposition to List: “However, the increase in the price of grain raises the production costs of the industrialists, thereby making accumulation and competition more difficult for them. . . . Therefore the bad ‘exchange value,’ which falls in the form of land rent into the pockets of the landowners . . . must in one way or another be sacrificed to the general good – by free trade in grain, by shifting all taxes on to land rent, or by outright appropriation of land rent, i.e., of landed property, by the state,” as proposed by James Mill, Hilditch, and Cherbuliez (287).

Marx goes on to complain that List falsified Ricardo by attributing to him “the opposite view, that of the Physiocrats, according to which land rent is nothing but a proof of the natural productive force of land”; and that he did so in order to hide from German landed interests the clash at play between them and the industrialists (see also 271). He goes on with his charge to say: “Hence, in relation to the higher nobility, Herr List does not dare to keep up his shadow play with ‘productive force.’ He wants to lure this nobility with ‘exchange values’ and therefore slanders the School of Ricardo, who neither judges land rent from the standpoint of productive force, nor judges the latter from the standpoint of the modern large- scale factory system” (288). Now List had been cited earlier as understanding Ricardo to exclude the theory of exchange value by his formulation of the economic problem: “At the present time the theory of exchange value has fallen into such impotence . . . that Ricardo . . . could say: ‘to determine the laws by which the yield from land is distributed between landowners, tenant-farmers and workers is the chief task of political economy’ ” (272). What we now see is Marx’s wholly justified insistence that the Ricardian exposition in fact turns intimately on exchange value. 35