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10 The Manchester men were accused of being inconsistent. They believed in liberty to compete with the laborer in order to reduce his wages, but not in liberty to compete with the capitalist in order to reduce his usury. Laissez faire was very good sauce for the goose, labor, but very poor sauce for the gander, capital. But how to correct this inconsistency, how to serve this gander with this sauce, how to put capital at the service of business men and laborers at cost, or free of usury,—that was the problem.

Marx, as we have seen, solved it by declaring capital to be a different thing from product, and maintaining that it belonged to society and should be seized by society and employed for the benefit of all alike. Proudhon scoffed at this distinction between capital and product. He maintained that capital and product are not different kinds of wealth, but simply alternate conditions or functions of the same wealth; that all wealth undergoes an incessant transformation from capital into product and from product back into capital, the process repeating itself interminably; that capital and product are purely social terms; that what is product to one man immediately becomes capital to another, and vice versa; that, if there were but one person in the world, all wealth would be to him at once capital and product; that the fruit of A's toil is his product, which, when sold to B, becomes B's capital (unless B is an unproductive consumer, in which case it is merely wasted wealth, outside the view of social economy); that a steam-engine is just as much product as a coat, and that a coat is just as much capital as a steam-engine; and that the same laws of equity govern the possession of the one that govern the possession of the other.

For these and other reasons Proudhon and Warren found themselves unable to sanction any such plan as the seizure of capital by society. But, though opposed to socializing the ownership of capital, they aimed nevertheless to socialize its effects by making its use beneficial to all instead of a means of impoverishing the many to enrich the few. And when the light burst in upon them, they saw that this could be done by subjecting capital to the natural law of competition, thus bringing the price of its use down to cost,—that is, to nothing beyond the expenses incidental to handling and transferring it. So they raised the banner of Absolute Free Trade; free trade at home, as well as with foreign countries; the logical carrying out of the Manchester doctrine; laissez faire the universal rule. Under this banner they began their fight upon monopolies, whether the all-inclusive monopoly of the