Sismondi’s essay against Ricardo in the Revue Encyclopédique of May 1824 finally enticed into the ring the then “prince de la science économique,” the supposed representative, heir, and popularizer of the Smithian school on the European continent, J. B. Say. In July of that year, Say responded to Sismondi in an essay with the title “The Balance Between Consumption and Production” in the Revue Encyclopédique, having already polemicized against Sismondi’s position in his correspondence with Malthus. Sismondi in turn published a short rejoinder to Say. The sequence of Sismondi’s polemical duels was thus actually the inverse of the sequence of theoretical legacies, for it was Say who first transmitted the doctrine of a God-given equilibrium between production and consumption to Ricardo, who in turn handed it down to McCulloch. In fact, Say had already established the following lapidary proposition in his Traité d’Économie Politique, Volume 1, Chapter 12, “Of the Demand or Market for Products,” in 1803: “Products are paid for with other products. It follows that if a nation has too many goods of one kind, the means of selling them would be to create goods of a different kind.”152 This represents the best-known formulation of the mystification that was accepted by Ricardo’s school and by vulgar economics as the cornerstone of the doctrine of harmony.153 Sismondi’s major work was essentially a sustained polemic against this thesis. At this point, Say turns the tables on his opponent with the following perplexing volte-face in the Revue Encyclopédique:
Objection may be made that, because of man’s intelligence, because of the advantage he can draw from the means provided by nature and artifice, every human society can produce all the things fit to satisfy its needs and increase its enjoyment in far larger quantities than it can itself consume. But there I would ask how it is possible that we know of no nation that is supplied with everything. Even in what rank as prospering nations seven-eighths of the population are lacking in a multitude of things considered necessities in … I will not say a wealthy family, but in a modest establishment. The village I live in at present lies in one of the richest parts of France; yet in nineteen out of twenty houses I enter here, I see but the coarsest fare and nothing that makes for the well-being of the people, none of the things the English call comforts.154
One can only admire the temerity of the distinguished Say. It was he who had maintained that there could be no difficulties, no surplus, no crises, and no poverty, since each commodity pays for one another, and all that is needed is to continue producing in ever-greater quantities for all problems to melt away. In Say’s hands, this thesis became a dogma of the vulgar economic doctrine of harmony. Sismondi had sharply criticized this thesis and demonstrated that it was untenable; he had pointed out that it is not true that commodities can be sold in any given quantity, since the total social revenue at any given time (v + s) constitutes an outer limit to the quantity of commodities that can be realized. However, given the fact that workers’ wages are driven down to the minimum level necessary for bare existence, and that the capacity of the capitalist class to consume also has its natural limits, the extension of production must lead to market stagnation, crises, and an even greater impoverishment of the masses of the people. Say now responds to this with a virtuoso performance of disingenuousness: you insist that overproduction is possible, but then how is it possible that there are so many people who are destitute, naked, and hungry in our society? Please explain this paradox for me.155 In this way, Say, whose main sleight of hand in his own position is to abstract from the circulation of money, thus assuming the immediate exchange of commodities, now imputes a position to his opponent wherein the latter considers an excess of products not in relation to the means of purchase of society, but in relation to its real needs! Sismondi had in actual fact left no doubt as to this question of cardinal importance to his deductions, as the following explicit statement in Volume 2, Chapter 6 of his Nouveaux Principes shows: “Even if there is a very great number of badly fed, badly clothed, and badly housed people in a society, the society can only sell what it buys, and, as we have seen, it can only buy with its income.”156
A little further on, Say concedes this point, but simultaneously imputes a new error to his adversary: “It is not consumers, then,” he says, “in which the nation is lacking, but purchasing power.” Sismondi believes that this will be more extensive, when the products are rare, when consequently they are dearer and their production procures ampler pay for the workers.157
Here Say attempts to flatten out Sismondi’s theory, which attacks the very foundations of capitalist organization, its anarchy in production and its entire mode of distribution, into his own vulgar conception, his own babbling method: he travesties Sismondi’s Nouveaux Principes, representing this work as a plea for the “scarcity” of commodities and for high prices. He then counters this with a paean to the forward march of capitalist accumulation, declares that as production becomes more vigorous, the workforce grows and the scale of production increases, “the nations will be better and more universally provided for,” and eulogizes the conditions of the industrially developed countries in contrast with the poverty of the Middle Ages. Say views Sismondi’s maxims, on the other hand, as highly noxious for bourgeois society:
Why does he call for an inquiry into the laws that might oblige the entrepreneur to guarantee a living for the worker he employs? Such an inquiry would paralyze the spirit of enterprise. Merely the fear that the authorities might interfere with private contracts is a scourge and harmful to the wealth of a nation.158
In the face of Say’s generic, blathering apologias, Sismondi once again brings the debate back to the basic issue:
Surely I have never denied that since the time of Louis XIV, France has been able to double her population and to quadruple her consumption, as he contends. I have only claimed that the increase of products is a good if it is desired, paid for, and consumed; that, on the other hand, it is an evil if, there being no demand, the only hope of the producer is to entice the consumers of a rival industry’s products. I have tried to show that the natural course of the nations is progressive increase of their property, an increase consequent upon their demand for new products and their means to pay for them, but that in consequence of our institutions, of our legislation having robbed the working class of all property and every security, they have also been spurred to a disorderly labor quite out of touch with the demand and with purchasing power, which accordingly only aggravates poverty.159
Hereupon Sismondi concludes the debate by inviting the complacent harmonist to consider the situation “presented by the rich nations, in which both public poverty and material wealth are constantly growing at the same time, and in which the class that produces everything is daily displaced into the state where it cannot consume anything.” On this shrill, discordant note, the first round of exchanges on the problem of accumulation is brought to an end.
Surveying the course and the results of this first controversy, two points can be established:
1) Despite all the confusion in Sismondi’s analysis, his superiority over Ricardo’s school as well as over the self-styled doyen of the Smithian school is readily apparent: Sismondi considers things from the standpoint of reproduction, he makes a sincere effort to grasp value concepts (capital and revenue) and material moments (means of production and means of consumption) in their interrelation within the total social process. In this he is closest to Smith, with the difference that Sismondi consciously emphasizes the contradictions in the total process as the keynote of his analysis and formulates the problem of accumulation as the nodal point and the main difficulty to be addressed; in the case of Smith, these contradictions appear as subjective ones of his own theory. In this regard, Sismondi represents an undoubted advance over Smith. Ricardo and his epigones, on the other hand, remain stuck in the categories of simple commodity circulation in the whole debate—for them, only the formula C—M—C (Commodity—Money—Commodity) exists, which they further erroneously reduce to the direct exchange of commodities and claim to have exhausted all problems relating to the reproduction and accumulation processes with such meager insights. This represents a regression behind Smith, and Sismondi gains a decisive advantage in comparison with such blinkered viewpoints. It is precisely in his capacity as a social critic that Sismondi displays a far greater sense for the categories of the bourgeois economy than its sworn apologists, in the same way that the socialist Marx subsequently demonstrates an infinitely more acute understanding for the differentia specifica of the capitalist economic mechanism, right down to individual details, than all the bourgeois economists put together. When Sismondi rails against Ricardo—“What, is wealth to be all, and man a mere nothing?”160—this is not merely an expression of the “ethical” weakness of his petty-bourgeois conception in comparison with Ricardo’s rigorous, classical objectivity. It is also indicative of Sismondi’s critical insight into the living social interconnections of the economy, and thus into its contradictions and difficulties—an insight that is sharpened by his sensibility for the social, and that stands opposed to the rigid narrow-mindedness of the abstract conception of Ricardo and his school. The controversy merely serves to underline the fact that neither Ricardo nor Smith’s epigones are able to grasp the problem of accumulation posed for them by Sismondi, let alone to solve it.
2) The solution of the problem was also made impossible by the fact that the whole debate had been sidetracked and was now focused on the problem of crises. The outbreak of the first crisis naturally dominated the debate, but equally naturally it prevented any insight on either side into the fact that crises in no way constitute the problem of accumulation, but are merely its specific, external form—i.e. that they merely represent a moment in the cyclical figure of capitalist reproduction. As a result, the debate was doomed ultimately to extinguish itself in a twofold confusion: one side directly deduced from crises that accumulation was impossible, while the other made the direct derivation from the exchange of commodities that crises were impossible. The absurdity of both deductions would be demonstrated by the further course of capitalist development.
Nonetheless, Sismondi’s critique retains its deep historical significance as the first theory to sound the alarm against the domination of capital: this alarm heralded the dissolution of classical economics, which was unable to overcome the problems that it itself had elicited. When Sismondi issues a distress call against the consequences of capitalist domination, he is certainly no reactionary rhapsodizing over precapitalist relations, even if he occasionally compares patriarchal forms of production in agriculture and industry favorably to the domination of capital in terms of their respective capacities to produce happiness. He strongly objects to attempts to portray him as such, e.g. in his polemic against Ricardo in the Revue Encyclopédique:
I can already hear the outcry that I jib at improvements in agriculture and craftsmanship and at every progress man could make; that I doubtless prefer a state of barbarism to a state of civilization, since the plough is a tool, the spade an even older one, and that, according to my system, man ought no doubt to work the soil with his bare hands. I never said anything of the kind, and I crave indulgence to protest once for all against all conclusions imputed to my system such as I myself have never drawn. Neither those who attack me nor those who defend me have really understood me, and more than once I have been put to shame by my allies as much as by my opponents … I beg you to realize that it is not the machine, new discoveries and inventions, not civilization to which I object, but the modern organization of society, an organization that despoils the man who works of all property other than his arms, and denies him the least security in a reckless overbidding that makes for his harm and to which he is bound to fall prey.161
The interests of the proletariat undeniably form the starting point of Sismondi’s critique, and he is completely correct in formulating his own basic inclination as follows: “I am only working for means to secure the fruits of labor to those who do the work, to make the machine benefit the man who puts it in motion.”162
Admittedly, when it comes to specifying in more detail the social organization that he is striving for, he backtracks and admits that he is unable to do so:
But what remains to be done is of infinite difficulty, and I certainly do not intend to deal with it today. I should like to convince the economists as completely as I am convinced myself that their science is going off on a wrong tack. But I cannot trust myself to be able to show them the true course; it is a supreme effort—the most my mind will run to—to form a conception even of the actual organization of society. Yet who would have the power to conceive of an organization that does not even exist so far, to see the future, since we are already hard put to it to see the present?163
It is certainly not to his shame that Sismondi openly acknowledged his inability to see into the future beyond capitalism at a time when the dominance of large-scale industrial capital had only just emerged historically, and when the idea of socialism was only possible in a utopian form. However, since Sismondi could neither move forward to a time beyond capitalism nor go back to a precapitalist past, the only option available to him for his critique was the petty-bourgeois middle path. Sismondi’s skepticism in relation to the possibility of a full development of capitalism, and thus of the productive forces led him to call for accumulation to be curbed and for a slowing of the pace of capital’s forward march in the expansion of its domination. Herein lies the reactionary side of his critique.164