towards a better understanding of the world, in order to change it.
I HOPE I am not succumbing to the fashion of supposing a golden age in the past, but I cannot help thinking that the nature and functions of deposit banking were much better understood forty years ago than they are now. We had not then become convinced that nothing in economics can be both simple and true, and the young were taught that the theory of deposit banking was very simple.
1. LABOUR-TIME ACCOUNTING OR CALCULATION IN KIND?
In 1920 Ludwig von Mises published an article "Die Wirtschaftsrechnung im sozialistischen Gemeinwesen", which was translated into English in 1935 as "Economic Calculation in the Socialist Commonwealth" and published in Collectivist Economic Planning: Critical Studies on the Possibilities of Socialism edited by Fron Hayek. His basic argument was that socialism would be impossible because, without money and prices fixed by the market, society would not be able to do economic calculations rationally. Or, as he put it, "where there is no free market there is no pricing mechanism; without a pricing mechanism, there is no economic calculation".
The transition from feudalism to capitalism is often viewed as the result of a gradual and rising progress of technology, urbanisation, science and trade - inevitable because humans have always possessed ‘the propensity to truck, barter and exchange’ (Adam Smith). However, as I hope to demonstrate, the rise of capitalism depended on very specific and localised conditions and was the result of a process that was far from automatic.
In May 1970, upon the occasion of the 150th anniversary of the birth of Friedrich Engels, the town of Wuppertal had organised an international scientific conference. This occasion brought together around 50 specialists from more than 10 European countries, as well as Israel and the United States whose task was to take stock of modern research on the thought of he who is universally taken to be, alongside his friend Karl Marx, one of the founders of “Marxism”.
"Propaganda and policemen, prisons and schools, traditional values and traditional morality all serve to reinforce the power of the few and to convince or coerce the many into acceptance of a brutal, degrading and irrational system." (AS WE SEE IT - Solidarity)
According to economists whose theories currently prevail in America, economics has replaced political economy, and economics deals with scarcity, prices, and resource allocation. In the definition of Paul Samuelson, "economics - or political economy, as it used to be called ...
One of the most amusing reports to come out of France during the recent unrest was of one panic-stricken capitalist, convinced that his class was about to be expropriated, who loaded his car with over £1 million in cash and made a dash for the Swiss border. But his terror, ridiculous in retrospect, was matched by a corresponding euphoria in left-wing circles. Anyone accustomed to thinking along Bolshevik or anarchist lines was convinced that "a revolutionary situation" had developed and, in Britain at any rate, there were several groups declaring that the socialist revolution had started.
Fifty years ago on 6th January began the hopeless Spartakist rising against the Social Democrat government of Germany. It led to the brutal murder of Karl Liebknecht and Rosa Luxemburg, two well-known and courageous opponents of the first world slaughter. Luxemburg, as an opponent of both reformism and Bolshevism who understood the worldwide and democratic nature of socialism, had views on many subjects near to those of the Socialist Party of Great Britain. However, there were certain basic differences between our views and hers.
Classical economy, whose beginning is usually traced to Adam Smith, found its best expression and also its end in David Ricardo. Ricardo, as Marx wrote, “made the antagonism of class-interest, of wages and profits, of profits and rent, the starting-point of his investigation, naively taking this antagonism for a social law of nature.
