Das Kapital III — Kap. 20

Kap. 20

Das Kaufmannskapital ist keine besondre Art des industriellen Kapitals

Behind us lies money-dealing capital: the technical side of a capital that lives off the handling of money, whose gain still comes from a share of the surplus-value produced elsewhere. The reckoning of that share, and the forms it takes, are established. What has not been asked is historical. Here the question is where trade stands in relation to industrial capital, and whether it is a species alongside mining, farming or transport. This stretch settles that it is not, shows what is really distinct about it, and turns to Smith and Ricardo, who were at a loss before it.

Die besondre Form der Geldakkumulation des Warenhandlungs- und Geldhandlungskapitals wird erst im nächsten Abschnitt betrachtet.

deferred to the next Part

The special way commercial capital and money-dealing capital build up their money is taken up only in the next Part.

Aus dem bisher Entwickelten ergibt sich von selbst, daß nichts abgeschmackter sein kann, als das Kaufmannskapital, sei es in der Form des Warenhandlungskapitals, sei es in der des Geldhandlungskapitals, als eine besondre Art des industriellen Kapitals zu betrachten, ähnlich wie etwa Bergbau, Ackerbau, Viehzucht, Manufaktur, Transportindustrie etc., durch die gesellschaftliche Teilung der Arbeit gegebne Abzweigungen und daher besondre Anlagesphären des industriellen Kapitals bilden. Schon die einfache Beobachtung, daß jedes industrielle Kapital, während es sich in der Zirkulationsphase seines Reproduktionsprozesses befindet, als Warenkapital und Geldkapital ganz dieselben Funktionen verrichtet, die als ausschließliche Funktionen des kaufmännischen Kapitals in seinen beiden Formen erscheinen, müßte diese rohe Auffassung unmöglich machen. Im Warenhandlungskapital und Geldhandlungskapital sind umgekehrt die Unterschiede zwischen dem industriellen Kapital als produktivem und demselben Kapital in der Zirkulationssphäre dadurch verselbständigt, daß die bestimmten Formen und Funktionen, die das Kapital hier zeitweilig annimmt, als selbständige Formen und Funktionen eines abgelösten Teils des Kapitals erscheinen und ausschließlich darin eingepfercht sind. Verwandelte Form des industriellen Kapitals und stoffliche, aus der Natur der verschiednen Industriezweige hervorgehende Unterschiede zwischen produktiven Kapitalen in verschiednen Produktionsanlagen sind himmelweit verschieden.

not a branch of industrial capital

From what has been set out so far it follows by itself that nothing is sillier than treating merchant's capital — call it commercial capital or money-dealing capital — as a special sort of industrial capital, the way mining, agriculture, cattle-rearing, manufacture, transport and so on are branches that the division of labour in society carves out, and so separate fields for industrial capital to invest in. The plainest observation ought on its own to make this crude view impossible: every industrial capital, while it is passing through the phase of circulation in its reproduction process, performs — in its role as commodity capital and money capital — exactly the same jobs that look like the exclusive business of merchant's capital in both of its forms.

With commercial capital and money-dealing capital it is the other way round. Here the difference between industrial capital as productive and that same capital sitting in the circulation sphere has been made self-standing: the particular forms and functions that capital takes on there for a time now appear as forms and functions in their own right, belonging to a part of capital that has broken off — and those forms and functions exist exclusively inside that broken-off part, penned up there and nowhere else. A transformed form of industrial capital, on one side, and the material differences between productive capitals that come out of what the various branches of industry are like, on the other — these two are poles apart.

Außer der Brutalität, womit der Ökonom überhaupt die Formunterschiede betrachtet, die ihn in der Tat nur nach der stofflichen Seite interessieren, liegt bei dem Vulgärökonomen dieser Verwechslung noch zweierlei zugrunde. Erstens seine Unfähigkeit, den merkantilen Profit in seiner Eigentümlichkeit zu erklären; zweitens sein apologetisches Bestreben, die aus der spezifischen Form der kapitalistischen Produktionsweise - die vor allem Warenzirkulation, und daher Geldzirkulation, als ihre Basis voraussetzt - hervorgehenden Formen von Warenkapital und Geldkapital, und weiterhin von Warenhandlungs- und Geldhandlungskapital, als aus dem Produktionsprozeß als solchem notwendig hervorgehende Gestalten abzuleiten.

the two reasons behind the vulgar economist's confusion

Economists in general treat distinctions of form in an off-hand way, because what genuinely interests them is the substantive side of things. Besides that, in the vulgar economist two further things lie behind this confusion. The first is that he simply cannot explain what is peculiar to commercial profit. The second is his apologetic endeavour: he wants to show that commodity capital and money capital, and consequently commodity-dealing capital and money-dealing capital, are forms that necessarily arise from the production process as such. But those forms come out of what the capitalist mode of production specifically is — and that mode presupposes the circulation of commodities, therefore also of money, as its basis from the start.

Wenn Warenhandlungskapital und Geldhandlungskapital sich nicht anders von Getreidebau unterscheiden, wie dieser von Viehzucht und Manufaktur, so ist sonnenklar, daß Produktion und kapitalistische Produktion überhaupt identisch sind und daß namentlich auch die Verteilung der gesellschaftlichen Produkte unter die Mitglieder der Gesellschaft, sei es zur produktiven oder zur individuellen Konsumtion, ebenso ewig durch Kaufleute und Bankiers vermittelt werden muß, wie der Genuß von Fleisch durch Viehzucht und der von Kleidungsstücken durch deren Fabrikation.⁴⁵

reductio: bankers eternally necessary

If the only thing setting commercial capital and money-dealing capital apart from grain-growing were the kind of thing that sets grain-growing apart from cattle-rearing and manufacturing, then it would be plain as day that production and capitalist production are one and the same, and in particular that the products of society have to be divided out among society's members — whether for productive or for individual consumption — by merchants and bankers, and must forever be so, no less eternally than meat is eaten by way of cattle-rearing and clothes are worn by way of their manufacture.

Die großen Ökonomen wie Smith, Ricardo etc., da sie die Grundform des Kapitals betrachten, das Kapital als industrielles Kapital, und das Zirkulationskapital (Geld- und Warenkapital) tatsächlich nur, soweit es selbst eine Phase im Reproduktionsprozeß jedes Kapitals, sind in Verlegenheit mit dem merkantilen Kapital als einer eignen Sorte. Die aus der Betrachtung des industriellen Kapitals unmittelbar abgeleiteten Sätze über Wertbildung, Profit etc. passen nicht direkt auf das Kaufmannskapital. Sie lassen dies daher in der Tat ganz beiseite liegen und erwähnen es nur als eine Art des industriellen Kapitals. Wo sie im besondren davon handeln, wie Ricardo beim auswärtigen Handel, suchen sie nachzuweisen, daß es keinen Wert schafft (folglich auch keinen Mehrwert). Aber was vom auswärtigen Handel, gilt vom inländischen.

Smith and Ricardo at a loss

The great economists — Smith, Ricardo and the rest — consider capital in its basic form, that is, industrial capital; and they consider circulation capital (money capital and commodity capital) really only in so far as it is itself a phase in the reproduction process of every capital. So they are at a loss before commercial capital as a variety with a character of its own. The propositions about the formation of value, profit and so on that are drawn straight from looking at industrial capital do not fit commercial capital directly. So they in fact leave it aside altogether, and mention it only as one kind of industrial capital. Where they deal with it specifically — as Ricardo does with foreign trade — they try to show that trade creates no value (and so no surplus-value either). And whatever is true of foreign trade is true of trade at home as well.

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Kap. 20

Das Handelskapital ist älter als die kapitalistische Produktionsweise

The reader arrives from an opening that has already refused two errors at once: commercial capital is not a separate species with a source of gain of its own, and it is not simply one industrial branch among others like mining or farming. It has been told that trade, and trading capital with it, long predates the capitalist mode. What comes now works out what that priority rests on — how little such capital needs in order to exist — and then turns the standpoint around: how it stands inside capitalist production, why its rate is levelled to the general average, and what its predominance tells you about the society around it.

Wir haben bisher das Kaufmannskapital vom Standpunkt und innerhalb der Grenzen der kapitalistischen Produktionsweise betrachtet. Nicht nur der Handel, sondern auch das Handelskapital ist aber älter als die kapitalistische Produktionsweise, ist in der Tat die historisch älteste freie Existenzweise des Kapitals.

capital's oldest independent form

So far we have looked at merchant's capital from the angle of the capitalist mode of production, and only within its limits. But trade predates the capitalist mode of production — and so does trading capital. Trading capital is in fact the oldest form in which capital has ever had an independent existence.

Da man bereits gesehn, daß der Geldhandel und das darin vorgeschoßne Kapital zu seiner Entwicklung nichts bedarf als die Existenz des Großhandels, weiter des Warenhandlungskapitals, so ist es nur das letztre, womit wir uns hier zu befassen haben.

money-dealing set aside

We have seen already that money-dealing, and the capital laid out in it, need nothing to develop except that large-scale trade exists, and, beyond that, commercial capital dealing in goods. So it's only this last kind we have to deal with here.

Weil das Handlungskapital eingepfercht ist in die Zirkulationssphäre und seine Funktion ausschließlich darin besteht, den Warenaustausch zu vermitteln, so sind zu seiner Existenz - abgesehn von unentwickelten Formen, die aus dem unmittelbaren Tauschhandel entspringen - keine andren Bedingungen nötig als zur einfachen Waren- und Geldzirkulation. Oder die letztre ist vielmehr seine Existenzbedingung. Auf Basis welcher Produktionsweise auch immer die Produkte produziert wurden, die als Waren in die Zirkulation eingehn - ob auf Basis des urwüchsigen Gemeinwesens oder der Sklavenproduktion oder der kleinbäuerlichen und kleinbürgerlichen oder der kapitalistischen -, es ändert dies nichts an ihrem Charakter als Waren, und als Waren haben sie den Austauschprozeß und die ihn begleitenden Formveränderungen durchzumachen. Die Extreme, zwischen denen das Kaufmannskapital vermittelt, sind gegeben für es, ganz wie sie gegeben sind für das Geld und für die Bewegung des Geldes. Das einzig Nötige ist, daß diese Extreme als Waren vorhanden sind, ob nun die Produktion ihrem ganzen Umfang nach Warenproduktion ist, oder ob bloß der Überschuß der selbstwirtschaftenden Produzenten über ihre, durch ihre Produktion befriedigten, unmittelbaren Bedürfnisse auf den Markt geworfen sind. Das Kaufmannskapital vermittelt nur die Bewegung dieser Extreme, der Waren, als ihm gegebner Voraussetzungen.

what trade needs to exist

Commercial capital is boxed into the sphere of circulation, and its one job is to broker the exchange of commodities. So for it to exist, no other conditions are needed than those needed for simple commodity and money circulation — leaving aside the undeveloped forms that come straight out of barter. Or rather, that simple circulation is its condition of existence.

It makes no difference which mode of production the products came from — a primitive community, slave production, small peasants or petty-bourgeois producers, or capitalist production. However they were made, as commodities they must pass through an exchange process, with the changes of form that go with it.

The two extremes that commercial capital mediates are given to it, just as they are given for money and for the movement of money. All that is needed is that these extremes are there as commodities — whether production is commodity production all the way through, or only the surplus, over and above what producers need for themselves, gets thrown on the market. Commercial capital only mediates the movement of these extremes, the commodities, which are handed to it as preconditions.

Der Umfang, worin die Produktion in den Handel eingeht, durch die Hände der Kaufleute geht, hängt ab von der Produktionsweise und erreicht sein Maximum in der vollen Entwicklung der kapitalistischen Produktion, wo das Produkt nur noch als Ware, nicht als unmittelbares Subsistenzmittel produziert wird. Andrerseits, auf der Basis jeder Produktionsweise, befördert der Handel die Erzeugung von überschüssigem Produkt, bestimmt, in den Austausch einzugehn, um die Genüsse oder die Schätze der Produzenten (worunter hier die Eigner der Produkte zu verstehn sind) zu vermehren; gibt also der Produktion einen mehr und mehr auf den Tauschwert gerichteten Charakter.

how far production goes through trade

How far production enters trade, and gets into merchants' hands, depends on the mode of production. It reaches its peak with fully developed capitalist production, where the product is made purely as a commodity and no longer as something the producer consumes directly.

But on the basis of any mode of production, trade helps to bring out a surplus product meant to go into exchange, so as to increase what the producers enjoy or hoard — 'producers' here meaning the people who own the products. So trade pushes production to be aimed more and more at exchange-value.

Die Metamorphose der Waren, ihre Bewegung, besteht 1. stofflich aus dem Austausch verschiedner Waren gegeneinander, 2. formell aus Verwandlung der Ware in Geld, Verkaufen, und Verwandlung des Geldes in Ware, Kaufen. Und in diese Funktionen, Austauschen von Waren durch Kauf und Verkauf, löst sich die Funktion des Kaufmannskapitals auf. Es vermittelt also bloß den Warenaustausch, der indessen von vornherein nicht bloß als Warenaustausch zwischen den unmittelbaren Produzenten zu fassen ist. Beim Sklavenverhältnis, Leibeignenverhältnis, Tributverhältnis (soweit primitive Gemeinwesen in Betracht kommen) ist es der Sklavenhalter, der Feudalherr, der Tribut empfangende Staat, welcher Eigner, also Verkäufer des Produkts ist. Der Kaufmann kauft und verkauft für viele. In seiner Hand konzentrieren sich Käufe und Verkäufe, wodurch Kauf und Verkauf aufhört, an das unmittelbare Bedürfnis des Käufers (als Kaufmann) gebunden zu sein.

the merchant's work: buying and selling

The metamorphosis of commodities, their movement, has two sides. In substance, it is different commodities being swapped for one another. In form, it is commodities turning into money — selling — and money turning into commodities — buying.

The work of commercial capital comes down to exactly these operations: exchanging commodities by buying and selling. So commercial capital does no more than mediate commodity exchange — and we must not take this, right from the start, as an exchange simply between the immediate producers. Under slavery, serfdom or tribute — the last where primitive communities are involved — the product belongs to, and is sold by, the slaveowner, the feudal lord, or the state that collects the tribute. A merchant does the buying and selling for many people. Purchases and sales collect in his hands, and so buying and selling stop being tied to the buyer's immediate need — the buyer here being a merchant.

Welches aber immer die gesellschaftliche Organisation der Produktionssphären, deren Warenaustausch der Kaufmann vermittelt, sein Vermögen existiert immer als Geldvermögen und sein Geld fungiert stets als Kapital. Seine Form ist stets G - W - G´; Geld, die selbständige Form des Tauschwerts, der Ausgangspunkt, und Vermehrung des Tauschwerts der selbständige Zweck. Der Warenaustausch selbst und die ihn vermittelnden Operationen - getrennt von der Produktion und vollzogen vom Nichtproduzenten - als bloßes Mittel der Vermehrung, nicht nur des Reichtums, sondern des Reichtums in seiner allgemeinen gesellschaftlichen Form, als Tauschwert. Das treibende Motiv und der bestimmende Zweck ist, G zu verwandeln in G + DeltaG; die Akte G - W und W - G´, die den Akt G - G´ vermitteln, erscheinen bloß als Übergangsmomente dieser Verwandlung von G in G + DeltaG. Dies G - W - G´ als charakteristische Bewegung des Kaufmannskapitals unterscheidet es von W - G - W, dem Warenhandel zwischen den Produzenten selbst, der auf den Austausch von Gebrauchswerten als letzten Zweck gerichtet ist.

M-C-M′ against C-M-C

Different societies may organize the spheres of production differently, and it is their commodity exchange the merchant mediates; yet his riches always take the form of money wealth, and his money is always capital at work. Its form is always M-C-M′: money — exchange-value in its independent shape — is where he starts, and making exchange-value grow is his independent purpose. The exchange of commodities, and the operations that carry it out — separated from production and done by people who do not produce — becomes a mere means of piling up wealth: not just wealth in any shape, but wealth as exchange-value, its general social form. What drives it and fixes its aim is turning M into M + ΔM, and the acts M-C and C-M′ that carry the act M-M′ through appear only as passing moments as it turns M into M + ΔM. This M-C-M′ is the movement that marks commercial capital out, and separates it from C-M-C, the trade in goods that happens directly between the producers, aimed only at swapping one use-value for another.

Je unentwickelter die Produktion, um so mehr wird sich daher das Geldvermögen konzentrieren in den Händen der Kaufleute oder als spezifische Form des Kaufmannsvermögens erscheinen.

undeveloped production, merchant wealth

So the more undeveloped production is, the more monetary wealth will gather in the hands of merchants — or show up as a specific form of merchants' wealth.

Innerhalb der kapitalistischen Produktionsweise - d.h. sobald sich das Kapital der Produktion selbst bemächtigt und ihr eine ganz veränderte und spezifische Form gegeben hat - erscheint das Kaufmannskapital nur als Kapital in einer besondren Funktion. In allen frühern Produktionsweisen, und um so mehr, je mehr die Produktion unmittelbar Produktion der Lebensmittel des Produzenten ist, erscheint Kaufmannskapital zu sein als die Funktion par excellence des Kapitals.

one function, or the leading one

Inside the capitalist mode of production — that is, once capital has taken command of production itself and given it a wholly different, specific shape — commercial capital appears only as capital in one particular function. In every earlier mode of production, by contrast, commercial capital appears as capital's function par excellence — and it does so all the more where production consists directly in the producer supplying his own means of subsistence.

Es macht also nicht die geringste Schwierigkeit einzusehn, warum das Kaufmannskapital als historische Form des Kapitals erscheint, lange bevor das Kapital sich die Produktion selbst unterworfen hat. Seine Existenz und Entwicklung zu einer gewissen Höhe ist selbst historische Voraussetzung für die Entwicklung der kapitalistischen Produktionsweise, 1. als Vorbedingung der Konzentration von Geldvermögen, und 2. weil die kapitalistische Produktionsweise Produktion für den Handel voraussetzt, Absatz im großen und nicht an den einzelnen Kunden, also auch einen Kaufmann, der nicht zur Befriedigung seines persönlichen Bedürfnisses kauft, sondern die Kaufakte vieler in seinem Kaufakt konzentriert. Andrerseits wirkt alle Entwicklung des Kaufmannskapitals darauf hin, der Produktion einen mehr und mehr auf den Tauschwert gerichteten Charakter zu geben, die Produkte mehr und mehr in Waren zu verwandeln. Doch ist seine Entwicklung, für sich genommen, wie wir gleich unten noch weiter sehn werden, unzureichend, um den Übergang einer Produktionsweise in die andre zu vermitteln und zu erklären.

precondition, but not the cause

So it is not in the least difficult to see why commercial capital should appear as the historical form of capital long before capital ever subjected production to itself. That commercial capital exists at all, and reaches a certain size, is itself one of the historical preconditions that let the capitalist mode of production arise: first, because it makes possible the piling-up of monetary wealth; second, because the capitalist mode of production assumes production meant for trade, sold in bulk rather than to a single customer — which means merchants buy, not to meet their own personal wants, but to gather the buying acts of many into one. On the other side, every step in the development of commercial capital works to give production a character aimed more and more at exchange-value, turning more and more products into commodities. But its development, considered on its own — as we will see further below — is not enough to mediate and explain how one mode of production gives way to another.

Innerhalb der kapitalistischen Produktion wird das Kaufmannskapital von seiner frühern selbständigen Existenz herabgesetzt zu einem besondern Moment der Kapitalanlage überhaupt, und die Ausgleichung der Profite reduziert seine Profitrate auf den allgemeinen Durchschnitt. Es fungiert nur noch als der Agent des produktiven Kapitals. Die mit der Entwicklung des Kaufmannskapitals sich bildenden besondern Gesellschaftszustände sind hier nicht mehr bestimmend; im Gegenteil, wo es vorherrscht, herrschen veraltete Zustände. Dies gilt sogar innerhalb desselben Landes, wo z.B. die reinen Handelsstädte ganz andre Analogien mit vergangnen Zuständen bilden als die Fabrikstädte.⁴⁶

demoted to one moment

Inside capitalist production, commercial capital is pushed down from the separate existence it once had: it becomes one particular moment within capital investment as a whole, and the equalization of profits brings its profit rate down to the general average. All it does now is act as productive capital's agent. As commercial capital develops it brings particular social conditions with it, but those conditions no longer decide anything here. It is the other way round: wherever commercial capital dominates, the conditions are out of date.

This holds even inside a single country — purely trading cities look far more like past conditions than manufacturing towns do.

Selbständige und vorwiegende Entwicklung des Kapitals als Kaufmannskapital ist gleichbedeutend mit Nichtunterwerfung der Produktion unter das Kapital, also mit Entwicklung des Kapitals auf Grundlage einer ihm fremden und von ihm unabhängigen gesellschaftlichen Form der Produktion. Die selbständige Entwicklung des Kaufmannskapitals steht also im umgekehrten Verhältnis zur allgemeinen ökonomischen Entwicklung der Gesellschaft.

the inverse-proportion law

Capital growing independently and predominantly as commercial capital means the same thing as production not being subjected to capital. It means capital is growing while production keeps organizing itself in a social form of production that is alien to capital and independent of it. And so, the more independently commercial capital develops, the less developed society is economically overall — the two move in inverse proportion to each other.

Kap. 20

Selbständiges Kaufmannsvermögen, Zwischenhandel und Veräußerungsprofit

The reading so far has ended on a relation of dependence: merchant's capital may precede capitalist production historically, yet its extent and standing are settled by the mode of production it works in, and once that mode is in place it is subordinated within it. What was asserted there is worked out here. Merchant's capital can be a historical precondition and still be reduced to a subordinate form. What follows shows why its independence peaks where capitalism is least developed, what the merchant's gain consists of in that world, and why trade's power over the communities it links is bounded.

Das selbständige Kaufmannsvermögen, als herrschende Form des Kapitals, ist die Verselbständigung des Zirkulationsprozesses gegen seine Extreme, und diese Extreme sind die austauschenden Produzenten selbst. Diese Extreme bleiben selbständig gegen den Zirkulationsprozeß, und dieser Prozeß gegen sie. Das Produkt wird hier Ware durch den Handel. Es ist der Handel, der hier die Gestaltung der Produkte zu Waren entwickelt; es ist nicht die produzierte Ware, deren Bewegung den Handel bildet. Kapital als Kapital tritt hier also zuerst im Zirkulationsprozeß auf. Im Zirkulationsprozeß entwickelt sich das Geld zu Kapital. In der Zirkulation entwickelt sich das Produkt zuerst als Tauschwert, als Ware und Geld. Das Kapital kann sich im Zirkulationsprozeß bilden und muß sich in ihm bilden, bevor es seine Extreme beherrschen lernt, die verschiednen Produktionssphären, zwischen denen die Zirkulation vermittelt. Geld- und Warenzirkulation können Produktionssphären der verschiedensten Organisationen vermitteln, die ihrer innern Struktur nach noch hauptsächlich auf Produktion des Gebrauchswerts gerichtet sind. Diese Verselbständigung des Zirkulationsprozesses, worin die Produktionssphären untereinander verbunden werden durch ein Drittes, drückt Doppeltes aus. Einerseits, daß die Zirkulation sich noch nicht der Produktion bemächtigt hat, sondern sich zu ihr als gegebner Voraussetzung verhält. Andrerseits, daß der Produktionsprozeß die Zirkulation noch nicht als bloßes Moment in sich aufgenommen hat. In der kapitalistischen Produktion dagegen ist beides der Fall. Der Produktionsprozeß beruht ganz auf der Zirkulation, und die Zirkulation ist ein bloßes Moment, eine Durchgangsphase der Produktion, bloß die Realisierung des als Ware produzierten Produkts und der Ersatz seiner als Waren produzierten Produktionselemente. Die unmittelbar aus der Zirkulation stammende Form des Kapitals - das Handelskapital - erscheint hier nur noch als eine der Formen des Kapitals in seiner Reproduktionsbewegung.

commercial wealth's autonomy, then subordination

Independent mercantile wealth, when it is the dominant form of capital, means the circulation process has become independent of its two extremes — and those extremes are the producers themselves, the ones doing the exchanging. Those extremes stay independent of the circulation process, and it stays independent of them.

At this stage the product turns into a commodity through trade. It is trade that develops the shaping of products into commodities; it is not the movement of an already-produced commodity that forms trade. So capital first appears as capital inside the circulation process. There money develops into capital, and there the product develops first as exchange-value, as commodity and as money. Capital can take shape in circulation, and must take shape there, before it learns how to master its poles — the different spheres of production that circulation links together. Money and commodities moving in circulation can link spheres of production organized in the most varied ways, spheres whose inner structure still aims mainly at producing use-values.

This independence of the circulation process, in which a third party ties the spheres of production to one another, expresses two things at once. On one side, circulation has not yet taken hold of production; it stands towards production as towards something given in advance. On the other side, the production process has not yet taken circulation into itself as a mere moment.

Under capitalist production, by contrast, both are true. Production rests entirely on circulation, and circulation is no more than a moment, a passing phase of production — just the realization of the product produced as a commodity, and the replacement of its elements of production, which are likewise produced as commodities. Commercial capital, the form of capital that comes straight out of circulation, now shows up here as only one of the shapes capital takes as it moves through reproduction.

Das Gesetz, daß die selbständige Entwicklung des Kaufmannskapitals im umgekehrten Verhältnis steht zum Entwicklungsgrad der kapitalistischen Produktion, erscheint am meisten in der Geschichte des Zwischenhandels (carrying trade), wie bei Venezianern, Genuesern, Holländern etc., wo also der Hauptgewinn gemacht wird nicht durch Ausfuhr der eignen Landesprodukte, sondern durch Vermittlung des Austausches der Produkte kommerziell und sonst ökonomisch unentwickelter Gemeinwesen und durch Exploitation beider Produktionsländer.⁴⁷ Hier ist das Kaufmannskapital rein, abgetrennt von den Extremen, den Produktionssphären, zwischen denen es vermittelt. Es ist dies eine Hauptquelle seiner Bildung. Aber dies Monopol des Zwischenhandels verfällt, und damit dieser Handel selbst, im selben Verhältnis wie die ökonomische Entwicklung der Völker fortschreitet, die es beiderseits exploitierte und deren Unentwickeltheit seine Existenzbasis war. Beim Zwischenhandel erscheint dies nicht nur als Verfall eines besondren Handelszweigs, sondern auch als Verfall des Übergewichts reiner Handelsvölker und ihres kommerziellen Reichtums überhaupt, der auf der Basis dieses Zwischenhandels beruhte. Es ist dies nur eine besondre Form, worin die Unterordnung des kommerziellen Kapitals unter das industrielle im Fortschritt der Entwicklung der kapitalistischen Produktion sich ausdrückt. Von der Art und Weise übrigens, wie das Kaufmannskapital da wirtschaftet, wo es direkt die Produktion beherrscht, bietet schlagendes Exempel nicht nur die Kolonialwirtschaft überhaupt (das. sog. Kolonialsystem), sondern ganz speziell die Wirtschaft der alten Holländisch-Ostindischen Kompanie.

the inverse law and the carrying trade

The law is this: the more independently commercial capital develops, the less developed capitalist production is. That law shows up most clearly in how the carrying trade developed — with the Venetians, the Genoese, the Dutch and so on. There the main gain was not made by exporting what the home country produced, but by acting as middleman for the exchange of products among communities whose commercial and other economic development was still backward, and by exploiting both countries that produced. Here commercial capital is pure, cut off from the extremes it mediates between, the spheres of production. This is one of the chief ways it comes into being.

But this monopoly over the carrying trade falls away, and the trade itself along with it, to the same degree that the peoples it exploited on both sides move forward economically — the peoples whose lack of development was the very basis of its existence. In the carrying trade this shows up not only as the decline of one particular branch of trade. It also shows up as the decline of the supremacy of the purely trading peoples, and of their commercial wealth in general, which rested on that carrying trade. And this is only one particular form in which commercial capital's subordination to industrial capital expresses itself as capitalist production advances.

As for how commercial capital carries on where it directly dominates production, a striking example is given not just by colonial trade in general (the so-called colonial system), but quite specifically by the operations of the old Dutch East India Company.

Da die Bewegung des kaufmännischen Kapitals G- W - G´ ist, so wird der Profit des Kaufmanns erstens gemacht durch Akte, die nur innerhalb des Zirkulationsprozesses vorgehn, also gemacht in den zwei Akten des Kaufs und Verkaufs; und zweitens wird er realisiert im letzten Akt, dem Verkauf. Es ist also Veräußerungsprofit, profit upon alienation. Prima facie erscheint der reine, unabhängige Handelsprofit unmöglich, solange Produkte zu ihren Werten verkauft werden. Wohlfeil kaufen, um teuer zu verkaufen, ist das Gesetz des Handels. Also nicht der Austausch von Äquivalenten. Der Begriff des Werts ist insofern darin eingeschlossen, als die verschiednen Waren alle Wert und darum Geld sind; der Qualität nach gleichmäßig Ausdrücke der gesellschaftlichen Arbeit. Aber sie sind nicht gleiche Wertgrößen. Das quantitative Verhältnis, worin sich Produkte austauschen, ist zunächst ganz zufällig. Sie nehmen sofern Warenform an, daß sie überhaupt Austauschbare, d.h. Ausdrucke desselben Dritten sind. Der fortgesetzte Austausch und die regelmäßigere Reproduktion für den Austausch hebt diese Zufälligkeit mehr und mehr auf. Zunächst aber nicht für die Produzenten und Konsumenten, sondern für den Vermittler zwischen beiden, den Kaufmann, der die Geldpreise vergleicht und die Differenz einsteckt. Durch seine Bewegung selbst setzt er die Äquivalenz.

profit upon alienation, and who sets the equivalence

Since commercial capital moves as M-C-M', the merchant's profit comes about, first, through acts that stay wholly inside circulation - the two acts of buying and selling. Second, it gets realized in the last act, the sale. So it is profit upon alienation. On the face of it, a pure commercial profit standing on its own looks impossible so long as products are sold at their values. 'Buy cheap and sell dear' is the law of commerce - not an exchange of equivalents. The concept of value enters only so far as these commodities are all of them values, and therefore money; taken qualitatively, each is as much an expression of social labour as any other. They are not, however, equal values. How much of one product trades for another starts out entirely a matter of chance. They take on commodity form in so far as they are in some way exchangeable - expressions, that is, of the same third thing. Continued exchange, and reproduction for exchange on a more regular footing, gradually does away with that chance character. At the outset, though, this holds not for producers and consumers but for the mediator between the two - the merchant, comparing money prices and pocketing the difference. His own movement is what establishes the equivalence.

Das Handelskapital ist im Anfang bloß die vermittelnde Bewegung zwischen Extremen, die es nicht beherrscht, und Voraussetzungen, die es nicht schafft.

mediation without mastery

At the start, commercial capital is only the movement that mediates between extremes it does not control, and between preconditions it does not create.

Wie aus der bloßen Form der Warenzirkulation, W - G - W, Geld nicht nur als Wertmaß und Zirkulationsmittel, sondern als absolute Form der Ware und damit des Reichtums, als Schatz hervorgeht und sein Beisichbleiben und Anwachsen als Geld zum Selbstzweck wird, so geht aus der bloßen Zirkulationsform des Kaufmannskapitals, G - W - G´, das Geld, der Schatz, hervor als etwas, das sich durch bloße Veräußerung erhält und vermehrt.

the hoard out of M–C–M′

Out of the simple form of commodity circulation, C–M–C, money emerges not just as a yardstick of value and a means of circulation, but as the commodity's absolute shape, and so wealth's — as a hoard — and its keeping itself and growing as money becomes an end in itself. In the same way, out of the simple circulation form of commercial capital, M–C–M′, money, the hoard, emerges as something that maintains and increases itself through mere alienation.

Die Handelsvölker der Alten existierten wie die Götter des Epikur in den Intermundien der Welt oder vielmehr wie die Juden in den Poren der polnischen Gesellschaft. Der Handel der ersten selbständigen, großartig entwickelten Handelsstädte und Handelsvölker beruhte als reiner Zwischenhandel auf der Barbarei der produzierenden Völker, zwischen denen sie die Vermittler spielten.

trading peoples as an enclave

The trading peoples of the ancient world lived like Epicurus's gods in the intermundia — the spaces between the worlds — or rather like the Jews in Poland, who lived in the pores of that society. The trade of the earliest independent, hugely developed trading cities and peoples rested, as pure carrying trade, on the barbarism of those producing peoples among whom they played middleman.

In den Vorstufen der kapitalistischen Gesellschaft beherrscht der Handel die Industrie; in der modernen Gesellschaft umgekehrt. Der Handel wird natürlich mehr oder weniger zurückwirken auf die Gemeinwesen, zwischen denen er getrieben wird; er wird die Produktion mehr und mehr dem Tauschwert unterwerfen, indem er Genüsse und Subsistenz mehr abhängig macht vom Verkauf als vom unmittelbaren Gebrauch des Produkts. Er löst dadurch die alten Verhältnisse auf. Er vermehrt die Geldzirkulation.

trade over industry, then reversed

In the stages before capitalist society, trade rules over industry; in modern society, the reverse is true. Trade will naturally react back, more or less, on the communities it is plied between. It brings production more and more under the sway of exchange-value, by making what people enjoy and what they live on hinge more on selling than on using the product directly. That is how it breaks up the old relations. It increases the circulation of money.

Er ergreift nicht mehr bloß den Überschuß der Produktion, sondern frißt nach und nach diese selbst an und macht ganze Produktionszweige von sich abhängig. Indes hängt diese auflösende Wirkung sehr ab von der Natur des produzierenden Gemeinwesens.

dissolving depends on the community

And it no longer lays hold of only the surplus; step by step it eats away at production itself, and makes whole branches of production depend on it. But how far this dissolving effect goes depends a great deal on the nature of the producing community.

Kap. 20

Plünderungssystem, auflösende Wirkung und die Grenzen des Handels

Readers arrive with the merchant established as an independent figure inside circulation, and with the pre-capitalist form of his gain — profit upon alienation, buying cheap to sell dear — already distinguished from what the capitalist-mode analysis refuses as a source of profit. Here that historical claim is pressed further: the plunder system, the dissolving effect of trade and its limits, and the point where the relation between trade and industry turns round. What is settled is the conditionality of all of it: trade dissolves, but what follows is fixed by the old mode itself.

Solange das Handelskapital den Produktenaustausch unentwickelter Gemeinwesen vermittelt, erscheint der kommerzielle Profit nicht nur als Übervorteilung und Prellerei, sondern entspringt großenteils aus ihr. Abgesehn davon, daß es den Unterschied zwischen den Produktionspreisen verschiedner Länder ausbeutet (und in dieser Beziehung wirkt es hin auf die Ausgleichung und Festsetzung der Warenwerte), bringen es jene Produktionsweisen mit sich, daß das Kaufmannskapital sich einen überwiegenden Teil des Mehrprodukts aneignet, teils als Zwischenschieber zwischen Gemeinwesen, deren Produktion noch wesentlich auf den Gebrauchswert gerichtet ist und für deren ökonomische Organisation der Verkauf des überhaupt in Zirkulation tretenden Produktenteils, also überhaupt der Verkauf der Produkte zu ihrem Wert von untergeordneter Wichtigkeit ist; teils weil in jenen frühern Produktionsweisen die Hauptbesitzer des Mehrprodukts, mit denen der Kaufmann handelt, der Sklavenhalter, der feudale Grundherr, der Staat (z.B. der orientalische Despot) den genießenden Reichtum vorstellen, dem der Kaufmann Fallen stellt, wie schon A. Smith in der angeführten Stelle für die Feudalzeit richtig herausgewittert hat. Das Handelskapital in überwiegender Herrschaft stellt also überall ein System der Plünderung dar⁴⁸, wie denn auch seine Entwicklung bei den Handelsvölkern der alten wie der neuern Zeit direkt mit gewaltsamer Plünderung, Seeraub, Sklavenraub, Unterjochung in Kolonien verbunden ist; so in Karthago, Rom, später bei Venezianern, Portugiesen, Holländern etc.

dominant trade: a system of plunder

While commercial capital is what handles the exchange of products between undeveloped communities, commercial profit does not merely look like fleecing and trickery — a large part of it grows out of exactly that. Not to mention that trade also exploits the gap between the production prices of different countries, and in this respect it works towards the equalising and fixing of commodity values.

On top of that, those ways of producing themselves mean that commercial capital takes for itself a predominant part of the surplus product. Partly it does so by serving as the go-between among communities whose production is still essentially aimed at use-value, and for whose economic set-up it is of subordinate importance that the part of the product which enters circulation at all should be sold, and indeed that products should be sold at their value. Partly it does so because under those earlier ways of producing the main owners of the surplus product, the ones the merchant deals with — the slaveholder, the feudal landlord, the state (the oriental despot, say) — are the ones holding the wealth that gets enjoyed, and it is round them that the merchant sets his snares, as Adam Smith already correctly sniffed out, in the passage quoted, for the feudal period. Commercial capital in a dominant position is therefore everywhere a system of plunder, and its growth among the trading peoples of antiquity and of modern times goes together directly with violent plunder, piracy, slave-raiding and the subjugation of colonies: Carthage, Rome, and later the Venetians, the Portuguese, the Dutch, and so on.

Die Entwicklung des Handels und des Handelskapitals entwickelt überall die Richtung der Produktion auf Tauschwert, vergrößert ihren Umfang, vermannigfacht und kosmopolisiert sie, entwickelt das Geld zum Weltgeld. Der Handel wirkt deshalb überall mehr oder minder auflösend auf die vorgefundenen Organisationen der Produktion, die in allen ihren verschiednen Formen hauptsächlich auf den Gebrauchswert gerichtet sind. Wieweit er aber die Auflösung der alten Produktionsweise bewirkt, hängt zunächst ab von ihrer Festigkeit und innern Gliederung. Und wohin dieser Prozeß der Auflösung ausläuft, d.h. welche neue Produktionsweise an Stelle der alten tritt, hängt nicht vom Handel ab, sondern vom Charakter der alten Produktionsweise selbst. In der antiken Welt resultiert die Wirkung des Handels und die Entwicklung des Kaufmannskapitals stets in Sklavenwirtschaft; je nach dem Ausgangspunkt auch nur in Verwandlung eines patriarchalischen, auf Produktion unmittelbarer Subsistenzmittel gerichteten Sklavensystems in ein auf Produktion von Mehrwert gerichtetes. In der modernen Welt dagegen läuft sie aus in die kapitalistische Produktionsweise. Es folgt hieraus, daß diese Resultate selbst noch durch ganz andre Umstände bedingt waren als durch die Entwicklung des Handelskapitals.

the dissolving effect and its limits

The growth of trade and of commercial capital always turns production more towards exchange-value, widens its scope, makes it more varied and more cosmopolitan, and turns money into world money. That is why trade always has a more or less dissolving effect on whatever organization of production it finds in place — and all those organisations, in all their various forms, are mainly aimed at use-value. How far it actually brings about the dissolution of the old way of producing depends first of all on how firm that way is and how well its parts hang together. And where this process of dissolution ends up — that is, which new way of producing replaces the old — is not for trade to decide; what decides it is the character of the old mode of production itself. In the ancient world, the effect of trade and the growth of commercial capital always results in a slave economy; depending on the starting point, it may also result only in a patriarchal slave system, geared to producing the direct means of subsistence, being turned into one geared to producing surplus-value. In the modern world, by contrast, it ends in the capitalist mode of production. It follows from all this that these outcomes were themselves dependent on circumstances quite different from the growth of commercial capital.

Es liegt in der Natur der Sache, daß, sobald städtische Industrie als solche sich von der agrikolen trennt, ihre Produkte von vornherein Waren sind und deren Verkauf also der Vermittlung des Handels bedarf. Die Anlehnung des Handels an die städtische Entwicklung und andrerseits die Bedingtheit der letztren durch den Handel sind soweit selbstverständlich.

urban products need trade's mediation

Once town industry separates off from agriculture as a branch of its own, the things it makes are commodities right from the outset, and selling them therefore calls for trade to act as go-between. That trade leans on the growth of towns, and that the towns in turn are conditioned by trade, are to that extent self-evident.

Jedoch hängt es hier durchaus von andren Umständen ab, wieweit industrielle Entwicklung damit Hand in Hand geht. Das alte Rom entwickelt schon in der spätern republikanischen Zeit das Kaufmannskapital höher als es je zuvor in der alten Welt bestanden hat, ohne irgendwelchen Fortschritt gewerblicher Entwicklung, während in Korinth und andren griechischen Städten Europas und Kleinasiens ein hochentwickeltes Gewerbe die Entwicklung des Handels begleitet. Andrerseits, im geraden Gegenteil zur städtischen Entwicklung und ihren Bedingungen, ist Handelsgeist und Entwicklung des Handelskapitals oft gerade nichtansässigen, nomadischen Völkern eigen.

Rome's trade outgrew its crafts

But whether industrial development keeps step with all this depends entirely on other circumstances. Ancient Rome, already in its later republican period, had commercial capital on a larger scale than the ancient world had ever known before, and this with no progress in craft production at all. Corinth, and other Greek cities of Europe and Asia Minor, had a highly developed craft industry alongside the growth of trade. On the other side, in direct contrast to town development and its conditions, a commercial spirit and the growth of commercial capital are often the mark of peoples who are not settled at all, but nomadic.

Es unterliegt keinem Zweifel - und gerade diese Tatsache hat ganz falsche Anschauungen erzeugt -, daß im 16. und im 17. Jahrhundert die großen Revolutionen, die mit den geographischen Entdeckungen im Handel vorgingen und die Entwicklung des Kaufmannskapitals rasch steigerten, ein Hauptmoment bilden in der Förderung des Übergangs der feudalen Produktionsweise in die kapitalistische. Die plötzliche Ausdehnung des Weltmarkts, die Vervielfältigung der umlaufenden Waren, der Wetteifer unter den europäischen Nationen, sich der asiatischen Produkte und der amerikanischen Schätze zu bemächtigen, das Kolonialsystem, trugen wesentlich bei zur Sprengung der feudalen Schranken der Produktion. Indes entwickelte sich die moderne Produktionsweise, in ihrer ersten Periode, der Manufakturperiode, nur da, wo die Bedingungen dafür sich innerhalb des Mittelalters erzeugt hatten. Man vergleiche z.B. Holland mit Portugal.⁴⁹ Und wenn im 16. und zum Teil noch im 17. Jahrhundert die plötzliche Ausdehnung des Handels und die Schöpfung eines neuen Weltmarkts einen überwiegenden Einfluß auf den Untergang der alten und den Aufschwung der kapitalistischen Produktionsweise ausübten, so geschah dies umgekehrt auf Basis der einmal geschaffnen kapitalistischen Produktionsweise. Der Weltmarkt bildet selbst die Basis dieser Produktionsweise. Andrerseits, die derselben immanente Notwendigkeit, auf stets größrer Stufenleiter zu produzieren, treibt zur beständigen Ausdehnung des Weltmarkts, so daß der Handel hier nicht die Industrie, sondern die Industrie beständig den Handel revolutioniert. Auch die Handelsherrschaft ist jetzt geknüpft an das größre oder geringre Vorwiegen der Bedingungen der großen Industrie. Man vergleiche z.B. England und Holland. Die Geschichte des Untergangs Hollands als herrschender Handelsnation ist die Geschichte der Unterordnung des Handelskapitals unter das industrielle Kapital. Die Hindernisse, die die innere Festigkeit und Gliederung vorkapitalistischer, nationaler Produktionsweisen der auflösenden Wirkung des Handels entgegensetzt, zeigt sich schlagend im Verkehr der Engländer mit Indien und China. Die breite Basis der Produktionsweise ist hier gebildet durch die Einheit kleiner Agrikultur und häuslicher Industrie, wobei noch in Indien die Form der auf Gemeineigentum am Boden beruhenden Dorfgemeinden hinzukommt, die übrigens auch in China die ursprüngliche Form war. In Indien wandten die Engländer zugleich ihre unmittelbare politische und ökonomische Macht, als Herrscher und Grundrentner, an, um diese kleinen ökonomischen Gemeinwesen zu sprengen.⁵⁰ Soweit ihr Handel hier revolutionierend auf die Produktionsweise wirkt, ist es nur, soweit sie durch den niedrigen Preis ihrer Waren die Spinnerei und Weberei, die einen uralt-integrierenden Teil dieser Einheit der industriell-agrikolen Produktion bildet, vernichten und so die Gemeinwesen zerreißen. Selbst hier gelingt ihnen dies Auflösungswerk nur sehr allmählich. Noch weniger in China, wo die unmittelbare politische Macht nicht zu Hilfe kommt. Die große Ökonomie und Zeitersparung, die aus der unmittelbaren Verbindung von Ackerbau und Manufaktur hervorgehn, bieten hier hartnäckigsten Widerstand den Produkten der großen Industrie, in deren Preis die faux frais des sie überall durchlöchernden Zirkulationsprozesses eingehn. Im Gegensatz zum englischen Handel läßt dagegen der russische die ökonomische Grundlage der asiatischen Produktion unangetastet.⁵¹

a main moment, not the cause

There is no doubt about it — and it is precisely this fact that has bred some quite false views — that in the 16th and 17th centuries the great revolutions in trade that came with the geographical discoveries, and that rapidly increased the growth of commercial capital, were a main moment in moving the feudal mode of production over into the capitalist one. The world market's sudden expansion, the swelling flood of commodities in circulation, the race between the European nations for Asian goods and American treasure, the colonial system — all of these helped substantially to burst the feudal limits on production. But in its first period, the manufacturing period, the modern mode of production developed only where the conditions for it had grown up inside the middle ages. Compare Holland with Portugal, for instance.

And while in the 16th century, and partly still in the 17th, the sudden widening of trade and the creation of a new world market had a predominant influence on the fall of the old mode of production and the rise of the capitalist one, this worked the other way round once the capitalist mode of production had been created. The world market itself is the basis of this mode of production. On the other hand, the necessity immanent in it to produce on an ever greater scale drives it to expand the world market constantly, so that trade is not what revolutionizes industry here; industry is forever revolutionizing trade. Commercial domination, too, is now tied to the greater or lesser predominance of the conditions of large-scale industry. Compare England and Holland, for instance. Holland's fall from being the leading trading nation tells the story of how commercial capital was subordinated to industrial capital.

How firmly pre-capitalist national modes of production resist trade's dissolving action, given how solid they are and how well their parts hang together, comes out strikingly in the English dealings with India and China. The broad base of production there is the union of small-scale agriculture with domestic industry, and in India there is also the form of village communities resting on common ownership of the land — which was, incidentally, the original form in China as well. In India the English also used the political and economic power they held directly, as rulers and as receivers of ground-rent, to break these small economic communities apart. Where their trade does have a revolutionary effect on the mode of production, it does so only by destroying, through the cheapness of their goods, the spinning and weaving that had formed part of this union of industrial and agricultural work since ancient times — and so tearing the communities apart. Even here they manage this work of dissolution only very gradually. Still less so in China, where direct political power does not come to their aid. The great economy and saving of time that come from farming and manufacture being directly joined offer the most stubborn resistance here to the products of large-scale industry, in whose price there enter the faux frais — the incidental costs — of the circulation process that perforates them everywhere. By contrast, Russian trade leaves the economic basis of Asiatic production untouched.

Kap. 20

Der doppelte Übergang und das Ende der Herrschaft des Handelskapitals

The reader arrives carrying the dissolution: commerce can break up an old way of producing, but what comes out of that depends on the character of the old mode itself, and once capitalist production stands on its own base the dependence reverses, industry revolutionizing trade rather than the other way round. Where trade's rule ends is therefore still open. What follows settles it: which road out of feudal production revolutionizes and which merely conserves, what the merchant's command over producers does and does not do to the way they work, and where trade stands once industry is strong — before the first theory of the new mode is measured by what it could see.

Der Übergang aus der feudalen Produktionsweise macht sich doppelt. Der Produzent wird Kaufmann und Kapitalist, im Gegensatz zur agrikolen Naturalwirtschaft und zum zünftig gebundnen Handwerk der mittelalterlichen städtischen Industrie. Dies ist der wirklich revolutionierende Weg. Oder aber, der Kaufmann bemächtigt sich der Produktion unmittelbar. Sosehr der letztre Weg historisch als Übergang wirkt - wie z.B. der englische Clothier <Tuchhändler> des 17. Jahrhunderts, der die Weber, die aber selbständig sind, unter seine Kontrolle bringt, ihnen ihre Wolle verkauft und ihr Tuch abkauft -, sowenig bringt er es an und für sich zur Umwälzung der alten Produktionsweise. die er vielmehr konserviert und als seine Voraussetzung beibehält. So z.B. war großenteils noch bis in die Mitte dieses Jahrhunderts der Fabrikant in der französischen Seidenindustrie, der englischen Strumpfwaren- und Spitzenindustrie bloß nominell Fabrikant, in Wirklichkeit bloßer Kaufmann, der die Weber in ihrer alten zersplitterten Weise fortarbeiten läßt und nur die Herrschaft des Kaufmanns ausübt, für den sie in der Tat arbeiten.⁵² Diese Manier steht überall der wirklichen kapitalistischen Produktionsweise im Wege und geht unter mit deren Entwicklung. Ohne die Produktionsweise umzuwälzen, verschlechtert sie nur die Lage der unmittelbaren Produzenten, verwandelt sie in bloße Lohnarbeiter und Proletarier unter schlechtern Bedingungen als die direkt unter das Kapital subsumierten und eignet sich ihre Mehrarbeit auf Basis der alten Produktionsweise an. Etwas modifiziert besteht dasselbe Verhältnis bei einem Teil der Londoner handwerksmäßig betriebnen Möbelfabrikation. Sie wird namentlich in den Tower Hamlets <östliche Stadtteile Londons> auf sehr ausgebreitetem Fuß betrieben. Die ganze Produktion ist in sehr viele voneinander unabhängige Geschäftszweige geteilt. Das eine Geschäft macht bloß Stühle, das andre bloß Tische, das dritte bloß Schränke usw. Aber diese Geschäfte selbst werden mehr oder weniger handwerksmäßig betrieben, von einem kleinen Meister mit wenigen Gesellen. Dennoch ist die Produktion zu massenhaft, um direkt für Private zu arbeiten. Ihre Käufer sind die Besitzer von Möbelmagazinen. Am Sonnabend begibt sich der Meister zu ihnen und verkauft sein Produkt, wobei ganz so über den Preis geschachert wird wie im Pfandhaus über den Vorschuß auf dies oder jenes Stück. Diese Meister bedürfen des wöchentlichen Verkaufs, schon um für die nächste Woche wieder Rohmaterial kaufen und Arbeitslohn auszahlen zu können. Unter diesen Umständen sind sie eigentlich nur Zwischenschieber zwischen dem Kaufmann und ihren eignen Arbeitern. Der Kaufmann ist der eigentliche Kapitalist, der den größten Teil des Mehrwerts in die Tasche steckt.⁵³ So ähnlich beim Übergang in die Manufaktur aus den Zweigen, die früher handwerksmäßig oder als Nebenzweige der ländlichen Industrie betrieben worden. Je nach der technischen Entwicklung, die dieser kleine Selbstbetrieb hat - wo er selbst schon Maschinen anwendet, die handwerksmäßigen Betrieb zulassen -, findet auch Übergang zur großen Industrie statt; die Maschine wird, statt mit der Hand, mit Dampf getrieben; wie dies z.B. in der letzten Zeit im englischen Strumpfwarengeschäft sich ereignet.

the twofold exit from feudalism

The exit from feudal production takes two different shapes. Either the producer himself becomes a merchant and a capitalist — as against farming that produced for its own needs, and as against the guild-tied handicraft of medieval town industry. That is the way that really revolutionizes production.

Or else the merchant gets production directly into his own hands. However often this works historically as a transition — the English clothier of the seventeenth century, for instance, who brought the weavers under his control although they were independent, sold them the wool and bought the cloth back from them — it does not, by itself, bring about the overthrow of the old mode of production. It conserves that mode, rather, and holds on to it as its own precondition.

For the most part, this went on until roughly mid-century: in the French silk trade, and in English hosiery and lace, the man who counted as a manufacturer was, in most cases, one only on paper. He was really just a merchant, one who let the weavers carry on in their old, scattered way, and exercised no rule over them but a merchant's — it was for him, in fact, that they worked. This practice everywhere stands in the way of the genuine capitalist mode of production, and it goes under as that mode develops.

It does not overturn the way production is carried on; it only makes the position of the direct producers worse. It turns them into plain wage-labourers and proletarians, worse off than the workers directly subsumed under capital, and it appropriates their surplus labour on the basis of that old mode of production.

Much the same relation, a little modified, holds for part of London's furniture-making, which is still run on handicraft lines — in Tower Hamlets especially, where it is carried on very extensively. The work is split into a great many branches that are independent of one another. One business turns out chairs and nothing else, another only tables, a third only cupboards, and so on. But these businesses are themselves run more or less as handicraft, by a small master with a few journeymen. Their output is too large all the same for them to work directly for private customers. Their buyers are the owners of furniture stores. Every Saturday the master turns up at one of these stores to sell what he has made, and the haggling over the price goes on just as it does in a pawnshop over the sum advanced on some item. These masters depend on the weekly sale — if only so they can buy fresh material for next week and pay their journeymen. In these circumstances they are really nothing but go-betweens, standing between the merchant and the workers they employ. The merchant is the actual capitalist, and the greater part of the surplus-value lands in his pocket.

Something similar holds in the passage into manufacture out of branches that were formerly carried on as handicraft, or as sidelines of rural industry. Whether such a small owner-run business goes on to large-scale industry depends on the technical level it has reached — on whether it already uses machines that still allow a handicraft-style operation. The machine is then driven by steam instead of by hand, as has happened recently, for example, in the English hosiery trade.

Es findet also ein dreifacher Übergang statt: Erstens, der Kaufmann wird direkt Industrieller; dies ist der Fall bei den auf den Handel gegründeten Gewerben, namentlich bei Luxusindustrien, welche von den Kaufleuten mitsamt den Rohstoffen und den Arbeitern aus der Fremde eingeführt werden, wie im fünfzehnten Jahrhundert in Italien aus Konstantinopel. Zweitens, der Kaufmann macht die kleinen Meister zu seinen Zwischenschiebern (middlemen) oder kauft auch direkt vom Selbstproduzenten; er läßt ihn nominell selbständig und läßt seine Produktionsweise unverändert. Drittens, der Industrielle wird Kaufmann und produziert direkt im großen für den Handel.

three forms of transition

So the transition takes three forms. First, the merchant becomes an industrialist outright — this is what happens in trades founded on commerce, luxury industries above all, where merchants bring in the raw materials and the workers together from abroad, as they came into Italy from Constantinople in the fifteenth century. Second, the merchant turns the small masters into his go-betweens (middlemen), or else buys directly from the producer who works on his own account; he leaves that producer nominally independent, and leaves his way of producing unchanged. Third, the industrialist turns merchant himself and starts producing directly, on a large scale, for trade.

Im Mittelalter ist der Kaufmann bloß "Verleger", wie Poppe richtig sagt, der sei es von den Zünftlern, sei es von den Bauern produzierten Waren. Der Kaufmann wird Industrieller oder vielmehr läßt die handwerksmäßige, besonders die ländliche kleine Industrie für sich arbeiten. Andrerseits wird der Produzent Kaufmann. Statt daß z.B. der Tuchwebermeister seine Wolle nach und nach in kleinen Portionen vom Kaufmann erhält und mit seinen Gesellen für diesen arbeitet, kauft er selbst Wolle oder Garn und verkauft sein Tuch an den Kaufmann. Die Produktionselemente gehn als von ihm selbst gekaufte Waren in den Produktionsprozeß ein. Und statt für den einzelnen Kaufmann zu produzieren oder für bestimmte Kunden, produziert der Tuchweber jetzt für die Handelswelt. Der Produzent ist selbst Kaufmann. Das Handelskapital verrichtet nur noch den Zirkulationsprozeß. Ursprünglich war der Handel Voraussetzung für die Verwandlung des zünftigen und ländlich-häuslichen Gewerbes und des feudalen Ackerbaus in kapitalistische Betriebe. Er entwickelt das Produkt zur Ware, teils indem er ihm einen Markt schafft, teils indem er neue Warenäquivalente und der Produktion neue Roh- und Hilfsstoffe zuführt und damit Produktionszweige eröffnet, die von vornherein auf den Handel gegründet sind, sowohl auf Produktion für den Markt und Weltmarkt wie auf Produktionsbedingungen, die aus dem Weltmarkt herstammen. Sobald die Manufaktur einigermaßen erstarkt, und noch mehr die große Industrie, schafft sie sich ihrerseits den Markt, erobert ihn durch ihre Waren. Jetzt wird der Handel Diener der industriellen Produktion, für die beständige Erweiterung des Markts Lebensbedingung ist. Eine stets ausgedehntere Massenproduktion überschwemmt den vorhandnen Markt und arbeitet daher stets an Ausdehnung dieses Markts, an Durchbrechung seiner Schranken. Was diese Massenproduktion beschränkt, ist nicht der Handel (soweit dieser nur existierende Nachfrage ausdrückt), sondern die Größe des funktionierenden Kapitals und die entwickelte Produktivkraft der Arbeit. Der industrielle Kapitalist hat beständig den Weltmarkt vor sich, vergleicht, und muß beständig vergleichen, seine eignen Kostpreise mit den Marktpreisen nicht nur der Heimat, sondern der ganzen Welt. Diese Vergleichung fällt in der frühern Periode fast ausschließlich den Kaufleuten zu und sichert so dem Handelskapital die Herrschaft über das industrielle.

trade becomes industry's servant

In the Middle Ages the merchant is only someone who 'transferred' goods, as Poppe rightly says — goods produced by guild craftsmen, or by peasants. The merchant becomes an industrialist; or rather, he gets handicraft production, small rural industry above all, to work for him. On the other side, the producer becomes a merchant. Take the master cloth-weaver: instead of receiving his wool from the merchant bit by bit, in small portions, and working with his journeymen for that merchant, he now buys wool or yarn for himself and sells his cloth to the merchant. The elements of production enter the production process as commodities he has bought himself. And instead of producing for one particular merchant, or for particular customers, the cloth-weaver now produces for the whole world of trade. The producer is his own merchant. Commercial capital now does nothing but carry out the circulation process.

Trade was originally the precondition for turning guild handicraft, rural domestic craft and feudal agriculture into capitalist businesses. It develops the product into a commodity: in part by finding a market for it, in part by supplying new commodity equivalents and new raw and auxiliary materials to production, and so opening up branches of production that are founded on trade from the start — founded both on production for the market and the world market, and on conditions of production that come from the world market. Once manufacture grows at all strong, and still more once large-scale industry does, it creates its own market and conquers it with its commodities. At that point trade turns into industrial production's servant — and for industrial production the constant widening of the market is a condition of existence. An ever more extensive mass production floods the market that exists, and so keeps working at widening that market, at breaking through its limits. What sets a limit to this mass production is not trade (in so far as trade only gives expression to demand that already exists), but the size of the capital in operation and the productivity of labour that has been developed.

The industrial capitalist always has the world market before him; he compares, and must keep comparing, his own cost prices with market prices — not only at home, but across the whole world. In the earlier period this comparison fell almost exclusively to the merchants, and that is what secured commercial capital its mastery over industrial capital.

Die erste theoretische Behandlung der modernen Produktionsweise - das Merkantilsystem - ging notwendig aus von den oberflächlichen Phänomenen des Zirkulationsprozesses, wie sie in der Bewegung des Handelskapitals verselbständigt sind, und griff daher nur den Schein auf. Teils weil das Handelskapital die erste freie Existenzweise des Kapitals überhaupt ist. Teils wegen des überwiegenden Einflusses, den es in der ersten Umwälzungsperiode der feudalen Produktion, der Entstehungsperiode der modernen Produktion ausübt. Die wirkliche Wissenschaft der modernen Ökonomie beginnt erst, wo die theoretische Betrachtung vom Zirkulationsprozeß zum Produktionsprozeß übergeht. Das zinstragende Kapital ist zwar auch uralte Form des Kapitals. Warum aber der Merkantilismus nicht von ihm ausgeht, sondern sich vielmehr polemisch dazu verhält, werden wir später sehn.

mercantilism grasps only semblance

The first attempt to theorize the modern mode of production — mercantilism — necessarily took off from the surface appearances of circulation, in the shape they take on as something independent in the movement of commercial capital. So it seized only the semblance of things. Partly because commercial capital is capital's first free form of existence at all; partly because of the overwhelming influence it had in the first period of upheaval, when feudal production was overturned and modern production was coming into being. The real science of modern economics begins only where theory passes from the circulation process to the production process. Interest-bearing capital is, to be sure, an age-old form of capital too. But why mercantilism does not set out from it, and instead takes up a polemical relation to it, we shall see later.

Kap. 20

Merchant's Capital Is Not a Special Kind of Industrial Capital

The special form in which money is accumulated by commercial and money-dealing capital will be considered only in the next Part.

deferred to the next Part

The special way commercial capital and money-dealing capital build up their money is taken up only in the next Part.

From what has already been developed, it should be clear enough that nothing could be more absurd than to treat merchant’s capital, whether in the form of commercial capital or of money-dealing capital, as a special kind of industrial capital, in the way that mining, agriculture, stock-raising, manufacture, transport, etc. are branches resulting from the social division of labour and as such form particular spheres of investment for industrial capital. Even the simple observation that every industrial capital, when it is in the circulation phase of its reproduction process, performs exactly the same functions as commodity capital and money capital, which appear as the exclusive functions of merchant’s capital in its two forms, would make this crude conception quite impossible. In commercial and money-dealing capital, rather, the distinctions between industrial capital as productive capital and the same capital in the sphere of circulation attain autonomy in the following way: the specific forms and functions that capital temporarily assumes in the latter case come to appear as independent forms and functions of a part of the capital that has separated off and become completely confined to this sphere. The transformed form of industrial capital, and the material distinctions between productive capitals applied in different ways as a result of the nature of the different branches of industry, are poles apart.

not a branch of industrial capital

Besides the off-hand way in which economists always treat distinctions of form, since they are in actual fact interested only in the substantive side, there are in the case of the vulgar economist two further reasons for this confusion. Firstly, his inability to explain commercial profit and its characteristic features; secondly, his apologetic endeavour to derive the forms of commodity capital and money capital, and consequently commodity-dealing and money-dealing capital, forms which arise from the specific form of the capitalist mode of production (which presupposes as its initial basis the circulation of commodities, and hence of money), as forms which necessarily arise from the production process as such.

the two reasons behind the vulgar economist's confusion

If commercial and money-dealing capital were distinct from cereal cultivation only in the same way as this is distinct from stock-raising and manufacture, it would be as clear as day that production in general and capitalist production in particular were completely the same, and in particular that the distribution of the social product among the members of society, whether for productive or for individual consumption, has to be effected just as eternally by merchants and bankers as the consumption of meat must be by stock-raising and that of articles of clothing by their manufacture. ⁴⁵

reductio: bankers eternally necessary

The great economists such as Smith, Ricardo, etc. focused their attention on the basic form of capital, capital as industrial capital, and in fact treated circulation capital (money and commodity capital) only in so far as it is itself a phase in that capital’s reproduction process. They were therefore perplexed by commercial capital as a special variety of its own. The principles about value formation, profit, etc. derived straight from the examination of industrial capital cannot be applied directly to commercial capital. They therefore entirely ignored the latter. They only refer to it as a kind of industrial capital. Where they deal with it specifically, as Ricardo does in connection with foreign trade, they seek to demonstrate that it creates no value (and consequently also no surplus-value). But what holds for foreign trade holds also for commerce within a country.

Smith and Ricardo at a loss

Kap. 20

Trading Capital Is Older than the Capitalist Mode of Production

Up to now we have considered merchant’s capital from the standpoint of the capitalist mode of production and within its limits. And yet not only trade, but also trading capital, is older than the capitalist mode of production, and is in fact the oldest historical mode in which capital has an independent existence.

capital's oldest independent form

Since we have already seen that money-dealing and the capital advanced in it needs nothing more for its development than the existence of large-scale trade in general, and subsequently of commercial, commodity-dealing capital, it is only this latter which we have to deal with now.

money-dealing set aside

Because commercial capital is confined to the circulation sphere, and its sole function is to mediate the exchange of commodities, no further conditions are needed for its existence — leaving aside undeveloped forms that arise from barter — than are necessary for the simple circulation of commodities and money. Or, one might say that precisely the latter is its condition of existence. Whatever mode of production is the basis on which the products circulating are produced — whether the primitive community, slave production, small peasant and petty-bourgeois production, or capitalist production — this in no way alters their character as commodities, and as commodities they have to go through the exchange process and the changes of form that accompany it. The extremes between which commercial capital mediates are given, as far as it is concerned, just as they are given for money and its movement. The only thing necessary is that these extremes should be present as commodities, whether production is over its whole range commodity production or whether it is merely the surplus from producers who work to satisfy their own direct needs that is put on the market. Commercial capital simply mediates the movement of these extremes, the commodities, as preconditions already given to it.

what trade needs to exist

The extent to which production goes into trade and passes through the hands of merchants depends on the mode of production, reaching a maximum with the full development of capitalist production, where the product is produced simply as a commodity and not at all as a direct means of subsistence. On the other hand, whatever mode of production is the basis, trade promotes the generation of a surplus product designed to go into exchange, so as to increase the consumption or the hoards of the producers (which we take here to mean the owners of the products). It thus gives production a character oriented more and more towards exchange-value.

how far production goes through trade

The metamorphosis of commodities, their movement, consists (1) materially, in the exchange of different commodities for one another, (2) formally, in the transformation of commodities into money, selling, and the transformation of money into commodities, buying. And the function of commercial capital is reducible to these functions, the exchange of commodities through buying and selling. Commercial capital thus simply mediates the exchange of commodities, though it should be understood right from the start that this is not just an exchange between the immediate producers. In the case of the slave relationship, the serf relationship, and the relationship of tribute (where the primitive community is under consideration), it is the slaveowner, the feudal lord or the state receiving tribute that is the owner of the product and therefore its seller. The merchant buys and sells for many people. Sales and purchases are concentrated in his hands, and in this way buying and selling cease to be linked with the direct need of the buyer (as merchant).

the merchant's work: buying and selling

But whatever the social organization of the spheres of production whose commodity exchange the merchant mediates, his wealth always exists as money wealth and his money always functions as capital. Its form is always M-C-M’; money, the independent form of exchange-value, is the starting-point, and the increase of exchange-value the independent purpose. Commodity exchange itself, and the operations that mediate it — separated from production and performed by non-producers — becomes simply a means of increasing wealth, and not just wealth, but wealth in its general social form as exchange-value. The driving motive and determining purpose here is the transformation of M into M + Δ M; the acts M-C and C-M’ that mediate the act M-M’ appear simply as transitional moments in this transformation of M into M + Δ M. This M-C-M’, as the characteristic movement of commercial capital, is distinguished from C-M-C, commodity trade between the producers themselves, with the exchange of use-values as its ultimate purpose.

M-C-M′ against C-M-C

The less developed production is, the more monetary wealth is concentrated in the hands of merchants and appears in the specific form of mercantile wealth.

undeveloped production, merchant wealth

So the more undeveloped production is, the more monetary wealth will gather in the hands of merchants — or show up as a specific form of merchants' wealth.

Within the capitalist mode of production — i.e. once capital takes command of production itself and gives it a completely altered and specific form — commercial capital appears simply as capital in a particular function. In all earlier modes of production, however, commercial capital rather appears as the function of capital par excellence, and the more so, the more production is directly the production of the producer’s means of subsistence.

one function, or the leading one

Thus there is no problem at all in understanding why commercial capital appears as the historic form of capital long before capital has subjected production itself to its sway. Its existence, and its development to a certain level, is itself a historical precondition for the development of the capitalist mode of production (1) as precondition for the concentration of monetary wealth, and (2) because the capitalist mode of production presupposes production for trade, wholesale outlet rather than supply to the individual client, so that a merchant does not buy simply to satisfy his own personal needs, but rather concentrates in his act of purchase the purchase acts of many. On the other hand, every development in commercial capital gives production a character oriented ever more to exchange-value, transforming products more and more into commodities. Even so, this development, taken by itself, is insufficient to explain the transition from one mode of production to the other, as we shall soon see in more detail.

precondition, but not the cause

In the context of capitalist production, commercial capital is demoted from its earlier separate existence, to become a particular moment of capital investment in general, and the equalization of profits reduces its profit rate to the general average. It now functions simply as the agent of productive capital. The particular social conditions that form with the development of commercial capital no longer play a determining part here; on the contrary, where commercial capital predominates, obsolete conditions obtain. This is true even within the same country, where for example purely trading cities exhibit a far greater analogy with past conditions than do manufacturing towns. ⁴⁶

demoted to one moment

This holds even inside a single country — purely trading cities look far more like past conditions than manufacturing towns do.

The independent and preponderant development of capital in the form of commercial capital is synonymous with the non-subjection of production to capital, i.e. with the development of capital on the basis of a social form of production that is foreign to it and independent of it. The independent development of commercial capital thus stands in inverse proportion to the general economic development of society.

the inverse-proportion law

Kap. 20

Independent Mercantile Wealth, the Carrying Trade, and Profit upon Alienation

If independent mercantile wealth is the prevailing form of capital, this means that the circulation process has attained independence vis-à-vis its extremes, and these are the exchanging producers themselves. These extremes remain separate from the circulation process, and this process from them. Here the product becomes a commodity through trade. It is trade that shapes the products into commodities; not the produced commodities whose movement constitutes trade. Capital as capital, therefore, appears first of all in the circulation process. In this circulation process, money develops into capital. It is in circulation that the product first develops as an exchange-value, as commodity and money. Capital can be formed in the circulation process, and must be formed there, before it learns to master its extremes, the various spheres of production between which circulation mediates. The circulation of money and commodities can mediate spheres of production with the most diverse organization, which in their internal structure are still oriented principally to the production of use-values. When the circulation process becomes independent in this way, as a process in which the spheres of production are linked together by a third party, this expresses a double situation. On the one hand, that circulation has still not mastered production, but is related to it simply as its given precondition. On the other hand, that the production process has not yet absorbed circulation into it as a mere moment. In capitalist production, on the contrary, both these things are the case. The production process is completely based on circulation, and circulation is a mere moment and a transition phase of production, simply the realization of a product produced as a commodity and the replacement of its elements of production produced as commodities. The form of capital that stems directly from circulation — commercial capital - now appears simply as one of the forms of capital in its movement of reproduction.

commercial wealth's autonomy, then subordination

The law that the independent development of commodity capital stands in inverse proportion to the level of development of capitalist production appears particularly clearly in the history of the carrying trade, as conducted by the Venetians, Genoans, Dutch, etc., where the major profit was made not by supplying a specific national product, but rather by mediating the exchange of products between commercially — and generally economically — undeveloped communities and by exploiting both the producing countries. ⁴⁷ Here we have commercial capital in its pure form, quite separate from the extremes, the spheres of production, between which it mediates. This is one of the main sources from which it is formed. But this monopoly of the carrying trade, and the trade itself, declines with the progress of the economic development of the peoples originally exploited by it from both sides, and whose lack of development was the basis of its existence. In connection with the carrying trade, this appears not only as a decline in one particular branch of trade, but also as a decline in the supremacy of the exclusively trading peoples and in their commercial wealth in general, which rested on the basis of this carrying trade. This is simply a particular form which the subordination of commercial capital to industrial capital takes with the progressive development of capitalist production. As for the manner and form in which commercial capital operates where it dominates production directly, a striking example is given not only by colonial trade in general (the so-called colonial system), but quite particularly by the operations of the former Dutch East India Company.

the inverse law and the carrying trade

Since the movement of commercial capital is M-C-M’, the merchant’s profit is firstly made by acts simply within the process of circulation, i.e. the two acts of purchase and sale. Secondly, it is realized in the final act, the sale. It is thus ‘profit upon alienation’. At first appearance, pure and independent commercial profit seems impossible so long as products are sold at their values. ‘Buy cheap and sell dear’ is the law of commerce, not the exchange of equivalents. The concept of value is involved here in so far as the various commodities are all values and therefore money; from the qualitative point of view, they are equally expressions of social labour. But they are not equal values. The quantitative relationship in which products exchange is at first completely accidental. They assume the commodity form in so far as they are in some way exchangeable, i.e. are expressions of some third thing. Continued exchange, and regular reproduction for exchange, gradually abolishes this accidental character. At the outset, however, this does not occur for the producers and consumers but rather for the mediator between the two, the merchant, who compares money prices and pockets the difference. It is through his movement that the equivalence is established.

profit upon alienation, and who sets the equivalence

Commercial capital, in the first instance, is simply the mediating movement between extremes it does not dominate and preconditions it does not create.

mediation without mastery

At the start, commercial capital is only the movement that mediates between extremes it does not control, and between preconditions it does not create.

Just as money arises from the simple form of commodity circulation, C-M-C, and not only as a measure of value and means of circulation, but also as an absolute form of the commodity and therefore of wealth, as a hoard, and makes its conservation and accumulation into an end in itself, so also, from the mere circulation form of commodity capital, M-C-M’, do money and the hoard develop into something that is maintained and increased simply by alienation.

the hoard out of M–C–M′

The trading peoples of old existed like the gods of Epicurus in the intermundia, or like the Jews in the pores of Polish society. The trade of the first independent and highly developed trading cities and peoples, as a pure carrying trade, rested on the barbarism of the producing peoples between whom they acted as intermediaries.

trading peoples as an enclave

In the stages that preceded capitalist society, it was trade that prevailed over industry; in modern society it is the reverse. Trade naturally reacts back to a greater or lesser extent on the communities between which it is pursued; it subjects production more and more to exchange-value, by making consumption and existence more dependent on sale than on the direct use of the product. In this way it dissolves the old relationships. It increases monetary circulation. It no longer just takes hold of surplus production, but gradually gobbles up production itself and makes entire branches of production dependent on it. This solvent effect, however, depends very much on the nature of the community of producers.

trade over industry, then reversed

English joined this paragraph

dissolving depends on the community

Kap. 20

The System of Plunder, the Solvent Effect, and the Limits of Trade

When commercial capital exchanges the products of undeveloped communities, commercial profit not only appears as defrauding and cheating but to a large extent does derive precisely from this. Apart from the fact that it exploits the difference between production prices in various countries (and in this connection it acts to equalize and establish commodity values), these modes of production enable commercial capital to appropriate for itself a preponderant part of the surplus product: partly by acting as middleman between communities whose production is still basically oriented to use-value, so that the sale of that part of their product that in some way or other steps into circulation, and thus the sale of products at their value in general, is of subordinate importance for their economic organization; and partly because in those earlier modes of production the principal proprietors of the surplus product whom the merchant trades with, i.e. the slave-owner, the feudal lord and the state (e.g. the oriental despot), represent the consumption wealth which the merchant sets out to trap, as Adam Smith correctly perceived in the passage quoted with regard to the feudal period. Commercial capital, when it holds a dominant position, is thus in all cases a system of plunder, ⁴⁸ just as its development in the trading peoples of both ancient and modern times is directly bound up with violent plunder, piracy, the taking of slaves and subjugation of colonies; as in Carthage and Rome, and later with the Venetians, Portuguese, Dutch, etc.

dominant trade: a system of plunder

The development of trade and commercial capital always gives production a growing orientation towards exchange-value, expands its scope, diversifies it and renders it cosmopolitan, developing money into world money. Trade always has, to a greater or lesser degree, a solvent effect on the pre-existing organizations of production, which in all their various forms are principally oriented to use-value. But how far it leads to the dissolution of the old mode of production depends first and foremost on the solidity and inner articulation of this mode of production itself. And what comes out of this process of dissolution, i.e. what new mode of production arises in place of the old, does not depend on trade, but rather on the character of the old mode of production itself. In the ancient world, the influence of trade and the development of commercial capital always produced the result of a slave economy; or, given a different point of departure, it also meant the transformation of a patriarchal slave system oriented towards the production of the direct means of subsistence into one oriented towards the production of surplus-value. In the modern world, on the other hand, its outcome is the capitalist mode of production. It follows that this result is itself conditioned by quite other circumstances than the development of commercial capital.

the dissolving effect and its limits

It lies in the nature of the case that as soon as specifically urban industry separates off from agriculture, its products are commodities from the start, so that their sale requires the mediation of trade. The dependence of trade on urban development is to this extent self-evident, as is the conditioning of the latter by trade. However, the degree to which industrial development goes hand in hand with these processes is dependent on entirely different circumstances. Ancient Rome, in the late republican era, saw the development of commercial capital to a higher level than ever before in the ancient world, without any kind of progress in the development of crafts; whereas in Corinth and other Greek cities of Europe and Asia Minor, a high level of craft development accompanied the development of trade. On the other hand, in diametrical opposition to urban development and its conditions, the commercial spirit and the development of commercial capital are often characteristic of non-settled, nomadic peoples.

urban products need trade's mediation

English joined this paragraph

Rome's trade outgrew its crafts

There can be no doubt — and this very fact has led to false conceptions — that the great revolutions that took place in trade in the sixteenth and seventeenth centuries, along with the geographical discoveries of that epoch, and which rapidly advanced the development of commercial capital, were a major moment in promoting the transition from the feudal to the capitalist mode of production. The sudden expansion of the world market, the multiplication of commodities in circulation, the competition among the European nations for the seizure of Asiatic products and American treasures, the colonial system, all made a fundamental contribution towards shattering the feudal barriers to production. And yet the modern mode of production in its first period, that of manufacture, developed only where the conditions for it had been created in the Middle Ages. Compare Holland with Portugal, for example. ⁴⁹ And whereas in the sixteenth century, and partly still in the seventeenth, the sudden expansion of trade and the creation of a new world market had an overwhelming influence on the defeat of the old mode of production and the rise of the capitalist mode, this happened in reverse on the basis of the capitalist mode of production, once it had been created. The world market itself forms the basis for this mode of production. On the other hand, the immanent need that this has to produce on an ever greater scale drives it to the constant expansion of the world market, so that now it is not trade that revolutionizes industry, but rather industry that constantly revolutionizes trade. Moreover, commercial supremacy is now linked with the greater or lesser prevalence of the conditions for large-scale industry. Compare England and Holland, for example. The history of Holland’s decline as the dominant trading nation is the history of the subordination of commercial capital to industrial capital. The obstacles that the internal solidity and articulation of pre-capitalist national modes of production oppose to the solvent effect of trade are strikingly apparent in the English commerce with India and China. There the broad basis of the mode of production is formed by the union between small-scale agriculture and domestic industry, on top of which we have in the Indian case the form of village communities based on common property in the soil, which was also the original form in China. In India, moreover, the English applied their direct political and economic power, as masters and landlords, to destroying these small economic communities. ⁵⁰ In so far as English trade has had a revolutionary effect on the mode of production in India, this is simply to the extent that it has destroyed spinning and weaving, which form an age-old and integral part of this unity of industrial and agricultural production, through the low price of English commodities. In this way it has torn the community to pieces. Even here, their work of dissolution is succeeding only very gradually. These effects are felt still less in China, where no assistance is provided by direct political force. The great economy and saving of time that results from the direct connection of agriculture and manufacture presents a very stubborn resistance here to the products of large-scale industry, whose prices include the faux frais [overhead expenses] of the circulation process with which they are everywhere perforated. In contrast to English trade, Russian trade leaves the economic basis of Asiatic production quite untouched. ⁵¹

a main moment, not the cause

Kap. 20

The Double Transition and the End of Commercial Capital's Dominion

The transition from the feudal mode of production takes place in two different ways. The producer may become a merchant and capitalist, in contrast to the agricultural natural economy and the guild-bound handicraft of medieval urban industry. This is the really revolutionary way. Alternatively, however, the merchant may take direct control of production himself. But however frequently this occurs as a historical transition — for example the English clothier of the seventeenth century, who brought weavers who were formerly independent under his control, selling them their wool and buying up their cloth — it cannot bring about the overthrow of the old mode of production by itself, but rather preserves and retains it as its own precondition. Right up to the middle of this century, for example, the manufacturer in the French silk industry, and the English hosiery and lace industries too, was a manufacturer only in name. In reality he was simply a merchant, who kept the weavers working in their old fragmented manner and exercised only control as a merchant; it was a merchant they were really working for. ⁵² This method always stands in the way of the genuine capitalist mode of production and disappears with its development. Without revolutionizing the mode of production, it simply worsens the conditions of the direct producers, transforms them into mere wage-labourers and proletarians under worse conditions than those directly subsumed by capital, appropriating their surplus labour on the basis of the old mode of production. Somewhat modified, the same relationships are to be found in the manufacture of furniture in London, which is partly carried out on a handicraft basis. This is particularly the case in Tower Hamlets. The whole of furniture production is divided into very many separate branches. One firm just makes chairs, another tables, a third chests and so on. But these firms themselves are conducted more or less on a handicraft basis, by one master with a few journeymen. Despite this, production is on too large a scale to work directly for private clients. The buyers are the proprietors of furniture stores. On Saturday the master goes to these stores and sells his products, with as much haggling over the price as there is in the pawnshop over an advance on some item or other. These masters need their weekly sale simply to buy more raw material for the coming week and to pay wages. Under these conditions they are really only middlemen between the merchant and their own workers. The merchant is the real capitalist and pockets the greater part of the surplus-value. ⁵³ Things are similar in the transition to manufacture from branches that were formerly pursued as handicrafts or as sidelines to rural industry. The transition to large-scale industry depends on the technical development of the small owner-operated establishment, whether it already employs machines that admit of a handicraft-like operation. Instead of by hand, the machine is now driven by steam, as has been happening recently in the English hosiery trade, for example.

the twofold exit from feudalism

The transition can thus take three forms. First, the merchant becomes an industrialist directly; this is the case with crafts that are founded on trade, such as those in the luxury industries, where the merchants import both raw materials and workers from abroad, as they were imported into Italy from Constantinople in the fifteenth century. Second, the merchant makes the small masters into his middlemen, or even buys directly from the independent producer; he leaves him nominally independent and leaves his mode of production unchanged. Third, the industrialist becomes a merchant and produces directly on a large scale for the market.

three forms of transition

In the Middle Ages, the merchant was simply someone who ‘transferred’ commodities, as Poppe correctly put it, whether these were produced by guilds or by peasants. The merchant becomes an industrialist, or at least has craftsmen in his employment, and particularly small rural producers. Alternatively, the producer becomes a merchant. Whereas before the master-weaver gradually received his wool from the merchant in small portions and worked along with his journeymen for the merchant, now the weaver buys wool or yarn himself, and sells the merchant his cloth. The elements of production go into the production process as commodities that he has himself bought. And instead of producing for the individual merchant or for particular customers, the weaver now produces for the entire world of commerce. The producer is his own merchant. Commercial capital now simply performs the circulation process. At first, trade is the precondition for the transformation of guild and rural domestic crafts into capitalist businesses, not to mention feudal agriculture. It develops the product into a commodity, partly by creating a market for it, partly by supplying new commodity equivalents and new raw and ancillary materials for production, and thereby opening new branches of production that are based on trade from the very beginning — both on production for the market and world market, and on conditions of production that derive from the world market. As soon as manufacture becomes somewhat stronger, and still more so large-scale industry, it creates a market for itself and uses its commodities to conquer it. Trade now becomes the servant of industrial production, for which the constant expansion of the market is a condition of existence. An ever-increasing mass production swamps the existing market and thus works steadily towards its expansion, breaking through its barriers. What restricts this mass production is not trade (in as much as this only expresses existing demand), but rather the scale of the capital functioning and the productivity of labour so far developed. The industrial capitalist is constantly faced with the world market; he compares and must compare his own cost prices not only with domestic market prices, but with those of the whole world. Previously, this comparison was almost exclusively the task of merchants and ensured commercial capital its mastery over industrial.

trade becomes industry's servant

The first theoretical treatment of the modern mode of production — mercantilism — necessarily proceeded from the superficial phenomena of the circulation process, as these acquire autonomy in the movement of commercial capital. Hence it only grasped the semblance of things. This was partly because commercial capital is the first independent mode of existence of capital in general. And partly on account of the overwhelming influence that commercial capital exercised in the period when feudal production was first overthrown, the period of the rise of modern production. The genuine science of modern economics begins only when theoretical discussion moves from the circulation process to the production process. Interest-bearing capital, too, is an age-old form of capital. But we shall see later why mercantilism did not take this as its basis, but rather engaged in polemics with it.

mercantilism grasps only semblance