Sismondi’s essay against Ricardo in the Revue EncyclopÉdique of May 1824, was the final challenge for J. B. Say, at that time the acknowledged ‘prince of economic science’ (prince de la science Économique), the so-called representative, heir and populariser of the school of Adam Smith on the Continent. Say, who had already advanced some arguments against Sismondi in his letters to Malthus, countered the following July with an essay on ‘The Balance Between Consumption and Production’ in the Revue EncyclopÉdique, to which Sismondi in turn published a short reply. The chronology of Sismondi’s polemical engagements was thus inverse to the sequence of the opposing theories, for it had been Say who first communicated his doctrine of a divinely established balance between production and consumption to Ricardo who had in turn handed it down to MacCulloch. In fact, as early as 1803, Say, in his TraitÉ d’Économie Politique, book i, chapter xii, had coined the following peremptory statement: ‘Products are paid for with other products. It follows that if a nation has too many goods of one kind, the means of selling them would be to create goods of a different kind.’[210]

Here we meet again the all too familiar conjuring recipe which was accepted alike by Ricardo’s school and by the ‘vulgar economists’ as the corner-stone of the doctrine of harmony.[211] Essentially, Sismondi’s principal work constitutes a sustained polemic against this thesis. At this stage Say charges to the attack in the Revue EncyclopÉdique with a complete volte-face, as follows:

‘Objection may be made that, because of man’s intelligence, because of the advantage he can draw from the means provided by nature and artifice, every human society can produce all the things fit to satisfy its needs and increase its enjoyment in far larger quantities than it can itself consume. But there I would ask how it is possible that we know of no nation that is supplied with everything. Even in what rank as prospering nations seven-eighths of the population are lacking in a multitude of things considered necessities in ... I will not say a wealthy family, but in a modest establishment. The village I live in at present lies in one of the richest parts of France; yet in 19 out of 20 houses I enter here, I see but the coarsest fare and nothing that makes for the well-being of the people, none of the things the English call comforts.’[212]

There is something to admire about the effrontery of the excellent Say. It was he who had maintained that in a capitalist economy there could be no difficulties, no surplus, no crises and no misery; since goods can be bought one for the other, we need only go on producing more and more and everything in the garden will be lovely. It was in Say’s hands that this postulate had become a tenet of the doctrine of harmony, that doctrine so typical of vulgar economics, which had evoked a sharp protest from Sismondi who proved this view untenable. The latter had shown that goods cannot be sold in any quantity you like, but that a limit is set to the realisation of goods by the income of society in each case, by v+ s; inasmuch as the wages of the workers are depressed to a mere subsistence level, and inasmuch as there is also a natural limit to the consumptive capacity of the capitalist class, an expansion of production, Sismondi says, must inevitably lead to slumps, crises and ever greater misery for the great masses. Say’s come-back to this is masterly in its ingenuity: If you will insist that over-production is possible, how can it happen that there are so many people in our society who are naked, hungry and in want? Pray, explain this contradiction if you can. Say, whose own position excels by contriving blithely to shrug off the circulation of money altogether by operating with a system of barter, now censures his critic for speaking of an over-abundance of products in relation not only to purchasing power but to the real needs of society, and that although Sismondi had left no doubt at all about this very salient point of his deductions. ‘Even if there is a very great number of badly fed, badly clothed and badly housed people in a society, the society can only sell what it buys, and, as we have seen, it can only buy with its income.’[213]

A little further on, Say concedes this point but alleges that his opponent has made a new mistake: ‘It is not consumers, then, in which the nation is lacking,’ he says, ‘but purchasing power. Sismondi believes that this will be more extensive, when the products are rare, when consequently they are dearer and their production procures ampler pay for the workers.’[214]

That is how Say attempts to degrade, in his own trite method of thought, or better, method of canting, Sismondi’s theory which attacked the very foundations of capitalist organisation and its mode of distribution. He burlesques the Nouveaux Principes, turning them into a plea for ‘rare’ goods and high prices, and holds up to them the mirror of an artfully flattered capitalist accumulation at its peak. If production becomes more vigorous, he argues, labour grows in numbers and the volume of production expands, the nations will be better and more universally provided for, and he extols the conditions in countries where industrial development is at its highest, as against the misery of the Middle Ages. Sismondi’s maxims he declares subversive to capitalist society: ‘Why does he call for an inquiry into the laws which might oblige the entrepreneur to guarantee a living for the worker he employs? Such an inquiry would paralyse the spirit of enterprise. Merely the fear that the authorities might interfere with private contracts is a scourge and harmful to the wealth of a nation.’[215]

Not to be diverted from his purpose by this indiscriminate apologia of Say’s, Sismondi once more turns the discussion on the fundamental issue:

‘Surely I have never denied that since the time of Louis XIV France has been able to double her population and to quadruple her consumption, as he contends. I have only claimed that the increase of products is a good if it is desired, paid for and consumed; that, on the other hand, it is an evil if, there being no demand, the only hope of the producer is to entice the consumers of a rival industry’s products. I have tried to show that the natural course of the nations is progressive increase of their property, an increase consequent upon their demand for new products and their means to pay for them, but that in consequence of our institutions, of our legislation having robbed the working class of all property and every security, they have also been spurred to a disorderly labour quite out of touch with the demand and with purchasing power, which accordingly only aggravates poverty.’[216]

And he winds up the debate by inviting the preacher of harmony to reflect upon the circumstance that, though a nation may be rich, public misery no less than material wealth is constantly on the increase, the class which produces everything being daily brought nearer to a position where it may consume nothing. On this shrill discordant note of capitalist contradictions closes the first clash about the problem of accumulation.

Summing up the general direction of this first battle of wits, we must note two points: (1) In spite of all the confusion in Sismondi’s analysis, his superiority to both Ricardo and his followers and to the self-styled heir to the mantle of Adam Smith is quite unmistakable. Sismondi, in taking things from the angle of reproduction, looks for concepts of value (capital and income) and for factual elements (producer and consumer goods) as best he can, in order to grasp how they are interrelated within the total social process. In this he is nearest to Adam Smith, with the difference only that the contradictions there appearing as merely subjective and speculative, are deliberately stressed as the keynote of Sismondi’s analysis where the problem of capital accumulation is treated as the crucial point and principal difficulty.

Sismondi has therefore made obvious advances on Adam Smith, while Ricardo and his followers as well as Say throughout the debate think solely in terms of simple commodity production. They only see the formula C—M—C, even reducing everything to barter, and believe that such barren wisdom can cover all the problems specific to the process of reproduction and accumulation. This is a regress even on Smith, and over such myopic vision, Sismondi scores most decisively. He, the social critic, evinces much more understanding for the categories of bourgeois economics than their staunchest champions—just as, at a later date, the socialist Marx was to grasp infinitely more keenly than all bourgeois economists together the differentia specifica of the mechanism of capitalist economy. If Sismondi exclaims in the face of Ricardo’s doctrine: ‘What, is wealth to be all, and man a mere nothing?’[217] it is indicative not only of the vulnerable moral strain in his petty-bourgeois approach compared to the stern, classical impartiality of Ricardo, but also of a critical perception, sharpened by social sensibilities for the living social connections of economy; an eye, that is, for intrinsic contradictions and difficulties as against the rigid, hidebound and abstract views of Ricardo and his school. The controversy had only shown up the fact that Ricardo, just like the followers of Adam Smith, was not even able to grasp, let alone solve the puzzle of accumulation put by Sismondi.

(2) The clue to the problem, however, was already impossible of discovery, because the whole argument had been side-tracked and concentrated upon the problem of crises. It is only natural that the outbreak of the first crisis should dominate the discussion, but no less natural that this effectively prevented either side from recognising that crises are far from constituting the problem of accumulation, being no more than its characteristic phenomenon: one element in the cyclical form of capitalist reproduction. Consequently, the debate could only result in a twofold quid pro quo: one party deducing from crises that accumulation is impossible, and the other from barter that crises are impossible. Subsequent developments of capitalism were to give the lie to both conclusions alike.

And yet, Sismondi’s criticism sounds the first alarm of economic theory at the domination of capital, and for this reason its historical importance is both great and lasting. It paves the way for the disintegration of a classical economics unable to cope with the problem of its own making. But for all Sismondi’s terror of the consequences attendant upon capitalism triumphant, he was certainly no reactionary in the sense of yearning for pre-capitalistic conditions, even if on occasion he delights in extolling the patriarchal forms of production in agriculture and handicrafts in comparison with the domination of capital. He repeatedly and most vigorously protests against such an interpretation as e.g. in his polemic against Ricardo in the Revue EncyclopÉdique:

‘I can already hear the outcry that I jib at improvements in agriculture and craftsmanship and at every progress man could make; that I doubtless prefer a state of barbarism to a state of civilisation, since the plough is a tool, the spade an even older one, and that, according to my system, man ought no doubt to work the soil with his bare hands.

‘I never said anything of the kind, and I crave indulgence to protest once for all against all conclusions imputed to my system such as I myself have never drawn. Neither those who attack me nor those who defend me have really understood me, and more than once I have been put to shame by my allies as much as by my opponents.’—‘I beg you to realise that it is not the machine, new discoveries and inventions, not civilisation to which I object, but the modern organisation of society, an organisation which despoils the man who works of all property other than his arms, and denies him the least security in a reckless over-bidding that makes for his harm and to which he is bound to fall a prey.’[218]

There can be no question that the interests of the proletariat were at the core of Sismondi’s criticism, and he is making no false claims when he formulates his main tendency as follows:

‘I am only working for means to secure the fruits of labour to those who do the work, to make the machine benefit the man who puts it in motion.’[219]

When pressed for a closer definition of the social organisation towards which he aspires, it is true he hedges and confesses himself unable to do so:

‘But what remains to be done is of infinite difficulty, and I certainly do not intend to deal with it to-day. I should like to convince the economists as completely as I am convinced myself that their science is going off on a wrong tack. But I cannot trust myself to be able to show them the true course; it is a supreme effort—the most my mind will run to—to form a conception even of the actual organisation of society. Yet who would have the power to conceive of an organisation that does not even exist so far, to see the future, since we are already hard put to it to see the present?’[220]

Surely it was no disgrace to admit oneself frankly powerless to envisage a future beyond capitalism in the year 1820—at a time when capitalism had only just begun to establish its domination over the big industries, and when the idea of socialism was only possible in a most Utopian form. But, as Sismondi could neither advance beyond capitalism nor go back to a previous stage, the only course open to his criticism was a petty-bourgeois compromise. Sceptical of the possibility of developing fully both capitalism and the productive forces, he found himself under necessity to clamour for some moderation of accumulation, for some slowing down of the triumphant march of capitalism. That is the reactionary aspect of his criticism.[221]