II.1. Economic Development and Socialism

The greatest achievement of the proletarian class struggle in the course of its development was the discovery of the points of departure for the realisation of socialism in the economic relations of capitalist society. Through it socialism changed from an “ideal” that had floated before humanity for thousands of years into a historical necessity. — Bernstein disputes the existence of these economic preconditions of socialism in present-day society. In the course of his argument he himself goes through an interesting development. At first, in the Neue Zeit, he disputed only the speed of concentration in industry, basing this on a comparison of the results of the German trade statistics of 1895 and 1882. To make use of these results for his purposes he had to resort to quite summary and mechanical procedures. But even in the most favourable case Bernstein could not touch Marx’s analysis in the least by pointing to the tenacity of medium-sized enterprises. For that analysis presupposes neither a definite tempo of the concentration of industry, that is, a definite time-limit for the realisation of the socialist final goal, nor, as we have shown, an absolute disappearance of small capitals, or the disappearance of the petty bourgeoisie, as a condition of the realisability of socialism.

Developing his views further, Bernstein now offers new evidence in his book, namely the statistics of joint-stock companies, which are supposed to show that the number of shareholders is constantly increasing, so that the capitalist class is not shrinking but, on the contrary, growing ever larger. It is astonishing how little Bernstein knows the available material, and how little he knows how to use it to his own advantage!

If he wanted to prove anything against Marx’s law of industrial development by means of joint-stock companies, he should have brought quite different figures. For anyone who knows the history of company promotion in Germany knows that the average founding capital per enterprise has been falling almost regularly. Before 1871 this capital amounted to about 10.8 million marks; in 1871 to only 4.01 million marks; in 1873, 3.8 million marks; in 1883–1887 to less than 1 million marks; in 1891 to only 0.56 million marks; in 1892, 0.62 million marks. Since then the amounts have fluctuated around 1 million marks, and indeed they have fallen again from 1.78 million marks in 1895 to 1.19 million marks in the first half of 1897.

Astonishing figures! With them Bernstein would probably even construct a whole anti-Marxian tendency of transition from large enterprises back to small ones. But in that case anyone could answer him: If you want to prove something with these statistics, you must first of all prove that they refer to the same branches of industry, that the smaller enterprises now appear in place of the old large ones and not where until now there was individual capital, or even handicraft or the dwarf enterprise. This proof, however, you will not succeed in providing, for the transition from huge joint-stock foundations to medium and small ones can be explained precisely and only by the fact that the joint-stock system is penetrating ever new branches, and that whereas at first it was suitable only for a few giant undertakings, it has now adapted itself more and more to medium-sized enterprise, here and there even to small enterprise. (Even joint-stock foundations with a capital as low as 1,000 marks occur!) But what does the ever wider spread of the joint-stock system mean for the national economy? It means the progressive socialisation of production in capitalist form, the socialisation not only of giant production but also of medium and even small production: that is, something that does not contradict Marx’s theory but confirms it in the most brilliant way imaginable.

Indeed! What does the economic phenomenon of the joint-stock company consist in? On the one hand in the union of many small fortunes in money into one productive capital; on the other hand in the separation of production from the ownership of capital; that is, in a twofold overcoming of the capitalist mode of production — always on a capitalist basis. In view of this, what do the statistics Bernstein cites of the large number of shareholders taking part in one enterprise mean? Nothing other than that one capitalist enterprise now corresponds not, as formerly, to one owner of capital but to a whole number, an ever-growing number, of owners of capital; that the economic concept “capitalist” therefore no longer coincides with the single individual; that the industrial capitalist of today is a collective person consisting of hundreds, indeed thousands, of persons; that the category “capitalist” itself has become, even within the framework of the capitalist economy, a social one, that it has been socialised.

How, then, in view of this, are we to explain that Bernstein takes the phenomenon of joint-stock companies precisely the other way round, as a splintering and not as a concentration of capital, that he sees the spread of capital-ownership where Marx sees the “abolition of capital-ownership”? By a very simple blunder of vulgar economics: because by capitalist Bernstein means not a category of production but one of property right, not an economic unit but a tax unit, and by capital not a whole of production but simply wealth in money. That is why in his English sewing-thread trust he sees not the welding together of 12,300 persons into one, but a full 12,300 capitalists; that is why his engineer Schulze, who received “a fair number of shares” from Müller the rentier as a dowry with his wife (p. 54), is a capitalist to him as well; that is why for him the whole world swarms with “capitalists”.

But here as elsewhere the blunder of vulgar economics is with Bernstein merely the theoretical ground for a vulgarisation of socialism. By transferring the concept of the capitalist from the relations of production to the relations of property, and “speaking of people instead of entrepreneurs” (p. 53), he also transfers the question of socialism from the sphere of production to the sphere of relations of wealth, from the relation of capital and labour to the relation of rich and poor.

With that we have happily been brought back from Marx and Engels to the author of the Gospel of a Poor Sinner, only with the difference that Weitling, with a sound proletarian instinct, recognised the class antagonisms in primitive form precisely in this antagonism of poor and rich and wanted to make it the lever of the socialist movement, whereas Bernstein, on the contrary, sees the prospects of socialism in turning the poor into rich, that is, in blurring the class antagonism, and so in a petty-bourgeois procedure.

Admittedly Bernstein does not confine himself to statistics of income. He also gives us statistics of enterprises, and from several countries: from Germany and from France, from England and from Switzerland, from Austria and from the United States. But what kind of statistics are they? They are not, say, comparative data from different points in time in each country, but from one point in time in each of different countries. Except for Germany, where he repeats his old comparison of 1895 with 1882, he compares, then, not the state of the structure of enterprises in one country at different moments, but only the absolute figures for different countries (for England from the year 1891, France 1894, the United States 1890, and so on). The conclusion he reaches is “that although large-scale enterprise in industry today in fact already predominates, it nevertheless, including the enterprises dependent on it, represents at most half of the population active in production even in so advanced a country as Prussia”, and similarly in the whole of Germany, England, Belgium and so on (p. 84).

What he proves in this way is evidently not this or that tendency of economic development, but merely the absolute relation of strength between the different forms of enterprise, or the different occupational classes. If this is meant to prove that socialism has no prospects, then the argument rests on a theory according to which the outcome of social endeavours is decided by the numerical, physical relation of strength between the combatants, that is, by the mere factor of force. Here Bernstein, who scents Blanquism everywhere, for a change falls himself into the crudest Blanquist misunderstanding. Once again, admittedly, with the difference that the Blanquists, as a socialist and revolutionary tendency, took the economic practicability of socialism for granted and based on it the prospects of a violent revolution even by a small minority, whereas Bernstein, conversely, concludes from the numerical inadequacy of the majority of the people that socialism has no economic prospects. Social Democracy derives its final goal no more from the victorious force of the minority than from the numerical preponderance of the majority, but from economic necessity and from the insight into this necessity, which leads to the abolition of capitalism by the mass of the people and which expresses itself above all in capitalist anarchy.

As regards this last, decisive question of anarchy in the capitalist economy, Bernstein himself denies only the great and general crises, not partial and national crises. He thus merely disputes a great deal of anarchy while admitting the existence of a little anarchy. The capitalist economy fares with Bernstein like — to speak with Marx for once — that foolish maid with the child that was “only a very little one”. The awkward thing about the matter, however, is that in things like anarchy a little and a lot are equally bad. If Bernstein admits a little anarchy, the mechanism of commodity economy of itself sees to the growth of this anarchy to enormous proportions — up to the collapse. But if Bernstein hopes — while keeping commodity production — gradually to dissolve even the little bit of anarchy into order and harmony, then he again falls into one of the most fundamental errors of bourgeois vulgar economics, in that he regards the mode of exchange as independent of the mode of production.

This is not the proper occasion to show in its entirety the astonishing confusion about the most elementary principles of political economy that Bernstein has displayed in his book. But one point, to which the basic question of capitalist anarchy leads us, should be briefly illuminated.

Bernstein declares that Marx’s law of labour value is a mere abstraction, which in political economy is evidently a term of abuse for him. But if labour value is merely an abstraction, “a mental image” (p. 44), then every upright citizen who has done his military service and paid his taxes has the same right as Karl Marx to fashion any nonsense he likes into such a “mental image”, that is, into a law of value. “From the outset Marx is just as entitled to abstract from the properties of commodities to the point where they finally remain only embodiments of quantities of simple human labour, as the Böhm–Jevons school is free to abstract from all the properties of commodities except their utility” (p. 42).

So Marx’s social labour and Menger’s abstract utility are all one to him: all mere abstraction. Bernstein has thus quite forgotten that Marx’s abstraction is not an invention but a discovery, that it exists not in Marx’s head but in the commodity economy, that it leads not an imaginary but a real social existence, an existence so real that it is cut and hammered, weighed and minted. For the abstract human labour discovered by Marx is, in its developed form, nothing other than — money. And this is precisely one of Marx’s most brilliant economic discoveries, whereas for the whole of bourgeois economics, from the first mercantilist to the last classical economist, the mystical nature of money has remained a book with seven seals.

The Böhm–Jevons abstract utility, on the other hand, is in fact merely a mental image, or rather an image of thoughtlessness, a private piece of nonsense for which neither capitalist nor any other human society, but solely and exclusively bourgeois vulgar economics, can be held responsible. With this “mental image” in their heads, Bernstein and Böhm and Jevons, with the whole subjective congregation, may stand before the mystery of money for another twenty years without arriving at any other solution than what every cobbler knew without them: that money is also a “useful” thing.

Bernstein has thus completely lost his understanding of Marx’s law of value. But anyone who is at all familiar with Marx’s economic system will see at once that without the law of value the whole system remains completely incomprehensible, or, to speak more concretely, that without an understanding of the nature of the commodity and its exchange the whole capitalist economy with its interconnections must remain a mystery.

But what is the magic key of Marx’s that opened to him the innermost secrets of all capitalist phenomena, that let him solve with playful ease problems whose very existence the greatest minds of classical bourgeois economics, such as Smith and Ricardo, did not even suspect? Nothing other than his conception of the whole capitalist economy as a historical phenomenon, and that not only looking backwards, as classical economics understood it at best, but also looking forwards, not only with regard to the feudal economic past but above all with regard to the socialist future. The secret of Marx’s theory of value, of his analysis of money, of his theory of capital, of his doctrine of the rate of profit, and so of the whole economic system, is — the transitoriness of the capitalist economy, its collapse, and therefore — this is only the other side of it — the socialist final goal. Precisely and only because Marx looked at the capitalist economy from the outset as a socialist, that is, from the historical point of view, could he decipher its hieroglyphics; and because he made the socialist standpoint the starting point of his scientific analysis of bourgeois society, he could, conversely, give socialism a scientific foundation.

It is by this that we must measure Bernstein’s remarks at the end of his book, where he complains of the “dualism” (split) “that runs through the whole monumental work of Marx”, “a dualism that consists in the fact that the work aims to be a scientific investigation and yet to prove a thesis that was complete long before it was conceived; that it is based on a scheme in which the result to which the development was supposed to lead was settled from the outset. The return to the Communist Manifesto (that is, to the socialist final goal!) points here to a real remnant of utopianism in the Marxian system.” (p. 177.) But Marx’s “dualism” is nothing other than the dualism of the socialist future and the capitalist present, of capital and labour, of the bourgeoisie and the proletariat; it is the monumental scientific reflection of the dualism existing in bourgeois society, of the bourgeois class antagonisms.

And when Bernstein sees in this theoretical dualism in Marx “a remnant of utopianism”, that is only a naive confession that he denies the historical dualism in bourgeois society, the capitalist class antagonisms; that for him socialism itself has become a “remnant of utopianism”. Bernstein’s “monism”, that is, his unity, is the unity of the capitalist order made eternal, the unity of the socialist who has dropped his final goal in order to see instead, in the one and unchanging bourgeois society, the end of human development.

But if Bernstein does not see in the economic structure of capitalism itself the split, the development towards socialism, then, in order to save the socialist programme at least in form, he must take refuge in an idealist construction lying outside economic development, and transform socialism itself from a definite historical phase of social development into an abstract “principle”.

Bernstein’s “principle of co-operation”, with which the capitalist economy is to be embellished, this thinnest dilution of the socialist final goal, appears in view of this as a concession of his bourgeois theory not to the socialist future of society but to the socialist past — of Bernstein.