Charles Fourier (1772-1837)

On Trade[204]

Source: A Fragment of Fourier’s On Trade, Engels 1845, from MECW Volume 4, p. 613, First published in Deutsches Bürgerbuch für 1846;
First Published: in Des trois unités externes, written between 1807 and 1821;
Transcribed: by Andy Blunden.

Introduction to these excerpts by Engels, 1845

I [207]

We now touch on civilisation’s most sensitive spot; it is an unpleasant task to raise one’s voice against the folly of the day, against chimeras that are downright epidemical.

To speak against the absurdities of trade today means to expose oneself to anathemas just as much as if one had spoken against the tyranny of the popes and the barons in the twelfth century. If it were a matter of choosing between two dangerous roles, I think it would be less dangerous to offend a sovereign with bitter truths than to offend the mercantile spirit which now rules as a despot over civilisation and even over sovereigns.

And yet a superficial analysis will prove that our commercial systems debase and disorganise civilisation, and that in trade as in all other things we are going astray more and more under the guidance of the inexact sciences.

The controversy on trade is hardly half a century old and has already produced thousands of volumes; and yet its originators have not seen that the trade mechanism is organised in such a way that it is a slap in the face for all common sense. It has subordinated the whole of society to one class of parasitical and unproductive people, the merchants. All the essential classes of society — the proprietor, [It must not be forgotten that Fourier was not a Communist. — Note by Engels] the farmer, the manufacturer, and even the government — find themselves dominated by an inessential, accessory class, the merchant, who should be their subordinate, their employed agent, removable and accountable, and who, nevertheless, directs and obstructs at will all the mainsprings of circulation.

In respect of errors other than those of trade, public opinion and the learned bodies are, indeed, more tractable; it is pretty well agreed that the philosophical systems are dangerous illusions, that experience belies our boasting of perfection, that our theories of freedom do not square with civilisation, that our virtues are social comedies and our legislations labyrinths; there are even jokes about a fashionable controversy, ideology. [208] But tongue-wagging about commerce, with its theories of imports and exports, counterbalance, balance, and guarantee, has become the Ark of the Covenant before which everything bows down. This, then, is the illusion which we have to dispel.

First of all we must show that our trade systems, which are now gaped at with stupid veneration, are the antipodes of truth, of justice, and therefore also of unity.

It is difficult to make clear to a century that precisely that operation which it considers to he the masterpiece of all wisdom is nothing but the seal of ignorance stamped on its entire policy. Let us but look at the already known results: maritime monopoly, fiscal monopoly, growing national debts, bankruptcies in unbroken succession resulting from paper money, increasing villainy in all business relations. Already now we can stigmatise the mechanism of free trade, i.e., of free lying, that veritable industrial anarchy, that monstrous power in society.

How is it that the most lying class in the social body is most protected by the ‘apostles of truth’? How does it happen that today learned men who preach contempt of vile wealth praise only the class which pursues wealth per fas et nefas [by legal or illegal means], the class of stock exchange gamblers and corner-men? Formerly the philosophers were unanimous in censuring certain corporations which defended with flexibility of conscience the proposition that there is a difference between taking and Stealing. How then have the same philosophers now become the apologists of a class which affirms, with still greater immorality, that haggling is not lying, that to dupe the buyer is not the same as robbing him, that stockjobbing and cornering are by no means plundering the productive class ‘ in brief, that one must work only for money, not for fame; — for that is the refrain which the merchants sing in chorus: We don’t pursue business pour la gloire! [This expression exists in literally the same form also among German merchants.- Note by Engels] Is it then to be wondered at that the modern sciences went astray when they espoused the cause of those who openly profess such principles?”

Trade takes various forms according to the various social stages; for as it is the pivot of all social life, it exists as soon as there is any social condition in general. A people becomes social, forms a society, from the moment when it begins to carry out exchange. For this reason trade exists already among the savages, where it takes the form of direct barter. Under patriarchy it becomes indirect commerce; in barbarism the basis of the commercial method is formed by the monopolies, the fixing of maximums and prices and forcible government requisitions, and in civilisation by individual competition or lying and bewildering struggles.

There is no need for us to dwell on direct barter among the sa ages who have no knowledge of money. One man is lucky at the hunt and exchanges a piece of game for arrows made by another, who has not been hunting and needs eatables. This method is not even trade, it is barter.

The second method, indirect commerce, is “primitive trade.” It is carried on through a go-between, who becomes the owner of something which he did not produce and he does not intend to consume. This method, although it is bad and leaves room for arbitrariness, is nevertheless highly advantageous in the following three cases:

1) in young countries, where only agriculture exists without industry; this is the state in which all colonies find themselves at the beginning;

2) in harsh lands, as in Siberia and the African deserts; a merchant who defies heat and cold to carry objects of necessity to distant parts is a very useful man;

3) in oppressed and constricted lands, where the, Bedouin plunder caravans, exact ransom from merchants and often murder them — every kind of protection is due to him who braves these dangers in order to bring supplies to a distant land. When such a merchant becomes rich he certainly deserves it.

In these three cases the merchants are neither Stock Exchange gamblers nor corner-men; they do not hawk, one speculator to another, the objects intended for consumption. On their arrival they offer them openly to the consumer in a bazaar or public market; they are the accelerators of industrial movement. They want to earn — nothing is more reasonable in the civilised world: he who has sown deserves to harvest. But it is very rare that the merchants content themselves with this function of theirs; singly or in alliance they scheme to obstruct the circulation of commodities in order to make prices immediately soar.

Trade becomes pernicious from the moment the go-betweens, due to their excessive number, become parasites [on the social body] and are ready to conceal goods, to let them rise in price under the pretext of an artificially produced scarcity, in brief, to rob simultaneously the producer and the consumer through speculation tricks instead of serving both as simple, open go-betweens. We still see this openness at our small markets in villages and towns. The man who buys a hundred calves or sheep is a useful intermediary for twenty peasants, who would otherwise lose whole working days to bring them to market in town. When, on arriving at the market, he publicly offers his animals for sale, he thereby renders a service also to the consumers; but when by means of heaven knows what tricks he agrees with other ‘friends of trade‘ to hide three-quarters of the sheep, to tell the butchers that sheep are scarce, that he can only supply a few friends, to sell them half as dear again under this pretext, to alarm the buyers, and then to bring the hidden sheep out one after the other, to sell them at inflated prices in the atmosphere of alarm previously created and thus to extort a high ransom from the consumers — then this is no longer simple commerce, open offering of commodities free from any intrigue, it is compound commerce, whose endlessly changing tricks give birth to the thirty-six typical vices of our trade system and are tantamount to a legal monopoly. When one lays hands on the total product by ruse in order to make it dearer, that is robbing more by means of intrigues than the monopoly does by armed force.

I shall not dwell any longer on the method of the barbarians. It comprises fixing of maximums, forcible requisitions and monopolies, which are still quite customary also in the civilised state. As I have already said elsewhere [Charles Fourier, Théorie de l’unité universelle, t. 2.-‘Prolégomène‘] the various methods of individual periods overlap; one must not wonder, therefore, that civilisation borrows individual features from both higher and lower stages. Our civilised trade mechanism is thus an amalgamation of the characters of all periods, with those of the civilised stage, however, predominating — and these are much more despicable still than those of barbarism, because our trade is nothing but organised and legitimised robbery under the mask of legality. As a result, the racketeers and intermediaries can unite to cause artificial dearth of any foodstuffs and thus plunder both producers and consumers to heap up in a hurry scandalous fortunes of fifty millions, whose owners nevertheless complain that there is no protection of trade, that the merchants cannot subsist, that nothing is done, and that the state is being ruined if the merchant is reduced to the inability to make more than fifty millions!

Meanwhile we are taught by a [new] science that these people should be granted complete freedom. Let the merchants do their job, we are told; without this freedom the corner-man, who even so has earned only fifty million, would perhaps not even have made a single million, and his respectable family would have to manage on fifty thousand francs revenue —

Dii, talem avertite casum,
[Ye gods, ward off such an occurrence!,
paraphrase from Virgil’s poem Aeneid, Book III]

... Contempt of commerce, a contempt inborn in all peoples, was prevalent in all nations considered to be honourable except for a few coastal clans of hucksters who derived benefit from commercial extortions and villainies. Athens, Tyre and Carthage, which profited by commerce, could not mock at it; everybody refrains from mocking at the ways in which he has enriched himself, and the financier least of all will mock at the art of adding ciphers to bills, or allowing the enemy to take away the ledgers and putting the cash in safety while reporting it also as having been taken by the enemy.

In reality with ancient as well as with modern peoples commerce has always been an object of mockery on the part of all honourable classes. How can one have any esteem for an out-and-out rascally profession or a class of people who lie with every word they say and by means of this magic art cam millions while the honest landowner who cultivates his piece of land with great effort and exertion, using the best of his experience, barely achieves an insignificant increase in its yield?

Meanwhile, for a century a new science called Economics has been exalting hucksters, stockjobbers, corner-men, usurers, bankrupts, monopolisers and commercial parasites to the peak of honours: the governments, daily deeper and deeper in debt, always intent on finding means of borrowing money, have found themselves forced to conceal their contempt and to spare this class of mercantile bk>od-suckers which keeps the money-coffers locked to civilisation and pumps out all the treasures of agricultural and industrial diligence under the pretext of serving it. It is not denied that trade ensures transportation, victualling, and distribution, but it does so like a servant who performs service actually worth a thousand francs annually and on the other hand robs his master of ten thousand francs, or ten times as much as he produces.

As a young spendthrift secretly despises the Jew to whom he goes every week to get himself fleeced, but still always greets him very politely, so also the modem governments have, with obvious contempt, concluded an armistice with trade, which is doing all the better for the fact that it knows how to have itself lumped together with the very manufacturers whom it plunders. The economists, who have found in this merchants’ hotchpotch a nursery of new dogmas, a mine of systems, have overthrown morality with all its high-sounding talk of truth in order to enthrone their favourites, the stockjobbers and bankrupts. Thereupon all the scholars rivalled in self-abasement; in the beginning science admitted those ‘friends of trade’ as its equals — Voltaire dedicated a tragedy to an English merchant. [Voltaire, Zaire] Today these stockjobbers would have a good laugh if a scholar presumed to dedicate a tragedy to them! Stockjobbing has discarded the mask, it no longer needs the incense of the scholars; it wants secret — and soon legal — participation in government! And indeed we have seen the Aachen Congress unable to decide anything until two bankers arrived. [209]

Despite the fact that the economic systems have exalted the Golden Calf of trade, they have been unable to put an end to the natural contempt which the nations feel towards it. It remains despised by the nobility, the clergy, the propertied classes, the officials, the lawyers, the scholars, despised by artists, soldiers, and every class worthy of respect. In vain has trade heaped sophism on sophism to prove to them that the stockjobbing blood-sucker should he respected — a natural disdain for this class of upstarts still prevails. Everybody yields to the upswing of a dogma favoured by fortune, but everybody continues in secret to despise the mercantile hydra, which takes no notice of this and pursues the course of its conquests.

How is it that our century has made public the crimes of so many classes, even those of the Federates, [210] who only existed for a month in 1815, whence comes it that it has never occurred to this century, which has spared neither kings nor popes in its collections on crimes, to make public the crimes of the merchants? Yet writers are unanimous in complaining that they suffer from a lack of material. To show them how fruitful this material is, I shall make a methodical analysis of only a single one of the (thirty-six) crimes of civilised trade. These thirty-six reprehensible features of our trade under the domination of individual competition and of bewildering and lying struggle are the following:

Syoptical Table of the Features of Civilised Trade

Pivotal points: Intermediate ownership and the dismemberment of agriculture.

1) The two-sidedness of trade.
2) Arbitrary determination of value.
3) Freedom of fraudulence.
4) Insolidarity, [lack of mutual liability].
5) Theft, removal of capital.
6) Decrease in wages.
7) Artificial obstruction of supply sources.
8) Oppressive surpluses.
9) Perverse interferences.
10) Destructive policy.
11) Torpidness or general lack of credit (recoil, repercussion).
12) Fictitious money.
13) Financial confusion.
14) Epidemical crime.
15) Obscurantism.
16) Parisitism.
17) Cornering (accaparement).
18) Stockjobbing.
19) Usury.
20) Unfruitful work.
21) Industrial lotteries (speculation on risk).
22) Indirect corporative monopoly.
23) Fiscal monopoly, state administration enforced by falsification.
24) The exotic, or colonial monopoly.
25) Maritime monopoly.
26) Feudal, caste monopoly.
27) Baseless provocation.
28) Loss.
29) Falsification.
30) Ruin of health.
31) Bankruptcy.
32) Smuggling.
33) Piracy.
34) Fixing of maximums and requisitions.
35) Speculative slavery.
36) Universal egoism.”

Of these thirty-six features we shall consider in detail only one, bankruptcy; before that I shall say a few words about some others.

Falseness of the Economic Principles on Circulation

(Proved by three features of the Table, Nos. 7, 8 and 12: artificial obstruction of supply sources, oppressive surpluses and fictitious money)

Our century, which has been so prolific of theories about the movement of industry, still cannot distinguish circulation from obstruction. It confuses circulation interrupted in places with that which is uninterrupted, simple circulation with compound. However, let us leave these dull distinctions; the facts may speak and serve us as a basis for principles which are directly opposed to those of economics.

Both governments and peoples agree that forgers, both of money and of public securities, should he punished with death. Those who counterfeit coins and bank-notes are indeed condemned to death. A very wise precautionary measure. But why does trade enjoy the right to forge money when this practice brings other people to the gallows?

Every bill of exchange made out by a merchant bears the seed of counterfeit, for it is extremely uncertain whether it will ever be paid. Everyone who steers a course towards bankruptcy floods circulation with his bills of exchange without intending ever to pay them. In this way he in fact makes and spreads counterfeit money.

Will it be objected that everyone else enjoys the same privilege, that a property-owner, like a merchant, can put bills of exchange into circulation?

That is not true. A property-owner cannot do that. A right is illusory when it cannot be exercised. Witness the constitutional right of the people to sovereignty, a pompous prerogative in spite of which the plebeian cannot even get his midday meal if he has not a sou in his pocket. And yet how far from the pretension to sovereignty is the claim to a midday meal. Many rights exist thus on paper, but not in reality, and their granting is an insult to him who cannot even ensure himself rights a hundred times less important.

So it is with the property-owner as regards the issuing of bills of exchange. He has the right to issue them as the plebeian has the right to claim sovereignty; but to possess the right and to exercise it are two very different things. When the property-owner makes out a bill of exchange he win not find anybody who will accept it without a guarantee, and he will be treated as one who forges money. He will be required to hypothecate a completely debt-free immovable property and to pay a usurious rate of interest into. the bargain. His bills of exchange would be accepted at this price, and with such a security they would be money with real value, not fictitious money like those of a second-hand dealer who, by virtue of his title as a ‘friend of trade, finds means of putting into circulation [good] bills to the value of a million when he does not possess even the hundredth part of that sum, even 10,000 francs as guarantee for that million.

How beautifully those governments let themselves be cheated who deprive themselves of this ability and guarantee it for the merchant! A merchant who has ten thousand francs security issues bills of exchange to the amount of a minion when he pleases; he is protected and authorised to do so; he has the right to set this mass of paper in circulation without the law being entitled to investigate how he places his capital and what securities he has. The Treasury, offering a guarantee of say ten million, would have to he able, according to this ratio, to issue securities up to a thousand million. But if a government tries to do so without consulting public opinion, without informing it of the move, it will see its credit ruined and its country exposed to political disturbances; and yet it is only doing the same, only availing, itself of the same privilege which is enjoyed by so many schemers, who often cannot offer the hundredth part of these guarantees and cannot run their business.

It will be answered that these schemers know how to talk over the foolish and insinuate themselves into their confidence; it is therefore set up as a principle of commerce that the art of duping and plundering good-natured, credulous people deserves to be protected in every way and that this protection must be limited to the merchant and not be enjoyed by the government. I do not maintain that this fine art should he allowed to both, but on the contrary that it should he denied both to rulers and to merchants.

From this it follows that the merchant enjoys the ability to issue fictitious money in the form of bills of exchange (twelfth feature) — a crime which is equivalent to forging money, for which the other categories of rascals are sent to the gallows — and that the trade system of civilised people legalises and protects competition of fraudulence (third feature).

The accusation of forging money, like the other points of the accusation, will be answered as follows: there must he merchants in order to ensure circulation, and business would become impossible if these agents were placed under restraint; the state would disrupt the public credit and place the whole of its industry in jeopardy.

It is true enough that a quality of trade is that it forges our fetters still tighter whenever the social body shows any signs of resistance. As soon as any administrative measure hampers the machinations of trade, trade restricts credit and paralyses circulation, while the state, which wanted to eliminate an old disorder, in the end adds new ones. This effect is called repercussion (eleventh feature) in the Table.

This danger is used as the basis for establishing the principle: Let the merchants do their job, their complete freedom is the guarantee of circulation. An exceedingly false principle, for it is precisely this complete freedom which gives rise to all the tricks that are so obstructive to circulation: stockjobbing, cornering, bankruptcy, and so on, the consequences of which are the two features:

7. Artificial obstruction of supply sources.

8. Oppressive surpluses.

Let us see what influence these two features have on circulation.”

Trade does not content itself with delivering commodities from the producer to the consumer, “it schemes by means of cornering and stockjobbing speculation to produce an artificial dearth of those food articles which are not exactly plentiful. In 1807 a stockjobbing manoeuvre suddenly raised the price of sugar to five francs in the month of May, and the same sugar dropped to two francs in July, although not the slightest new supplies had arrived. But the stockjobbing had been countered by means of false information and thus the sugar had been brought down to its value; the scheming and artificially aroused fears that there would he no supply had been disposed of. These schemes and artificial fears play their tricks every day with some food article and make it scarce without a real scarcity existing. In 1812, when the harvest was assured and the corner-men were disappointed in their hopes, enormous quantities of grain and flour were suddenly seen coming from their warehouses. So there had been no shortage at all and absolutely no danger of famine, if only these foodstuffs had been distributed rationally.” But trade has the peculiarity that even before there is a danger, with an eye to its possibility, it diverts supplies, stops circulation, arouses panicky fears, produces artificial food shortage.

The same effect is produced in times of surplus, when trade obstructs supplies out of affected fear of profusion. In the former case it operates positively, by buying up foodstuffs in anticipation; in the latter case negatively, by not buying and thus causing prices to drop so low that the peasant does not even get his production costs refunded. Hence arises the eighth feature, oppressive surpluses.

Trade will retort that it does not need to buy when it foresees no profit, and that it will not he so insane as to overload itself with grain which offers no probability at all of a surcharge, while it, trade, can invest its capital far more usefully in such commodities as hold out profit for it because of their scarcity, which can easily he increased by cornering.

There you have convenient and pleasant principles in a social system in which people talk about nothing but mutual guarantees. Trade is therefore exempted whenever it pleases from serving the social body. It acts like an army which would be authorised to refuse to fight whenever danger were present, and to do service only in its own interest, without any consideration for the state interest. Such is our mercantile policy, so one-sidedly does it determine all obligations.

In 1820 the price of grain dropped below three francs in various provinces in which a price of four francs hardly covered the costs. This would not have occurred had French trade bought in advance six months’ food supplies for thirty million persons,” as it would have had to do under a system of mutuality adapting itself to the interests of both parties. a “This reserve stock, withdrawn from circulation and locked up in granaries, would have kept up the price of the rest, and the peasant would not have suffered from the depreciation and the impossibility to market his products. But our trade system works exactly in the Opposite direction: it aggravates the pressure b of surplus and the evils of famine and thus has a destructive effect on both side’.

I have chosen the eighth feature, oppressive surplus, to show that the existing mode of trade has both negative and positive defects, and that it often sins by non-intervention, by omitting a service which it could easily render. For when in a time of famine the sum of five hundred million is required to buy up the corn, it is immediately available; but if this sum is needed for precautionary measures to increase stocks in times of surplus, not even five hundred talers c can he scraped together. There is neither mutuality nor guarantee in the contract concluded between the social body and the commercial body. The latter serves only its own interest, not that of society, and hence the abundant capital which it uses is a robbery perpetrated against industry as a whole. In the Table I have listed this robbery as the fifth feature: ‘Removal of capital.”

Thus, on both sides of trade there is not the slightest sense of obligation towards the social body, which surrenders itself, bound hand and foot, to the. Minotaur, to whom it guarantees despotic power over capitals and foodstuffs.” Yes, indeed, despotic power! “After so many declamations against despotism we still have not discovered the real one, which is no other than the despotism of trade, that real satrap of the civilised world!

To sum up, it follows from this that the civilised mechanism guarantees the merchants complete impunity for the crime of forging money, for which other classes are punished with death — and that this impunity is based on the pretence of help which they allegedly render to circulation but in reality refuse — positively by artificial obstruction of supply sources and negatively by oppressive profusion.

To this falsity in the results must be added the lack of any principles. The economists admit that their science has absolutely no fixed principles; and it is indeed the height of unprincipledness to grant complete freedom to a class of so exceedingly depraved agents as the merchants.

The consequence of all this is that the commercial movement proceeds by fits and starts, in spasms, surprises and excesses of all descriptions, as can be seen every day in the present trade mechanism, which can achieve only a periodically interrupted circulation, without regular graduation, without balance and guarantees.

An amusing result of this disorder is that people have the courage to reproach the government with financial abuses which they never dare to reproach trade with. Witness the two bankruptcies — that of Law’s bank-notes and that of the assignats. [211] These were gradual bankruptcies, they were seen approaching from afar; with a timely partial sacrifice they could have been guarded against. Despite these extenuating circumstances the public gave no quarter. It rightly declared Law’s notes and the assignats to be forgery, armed plunder.

Why then does the same public good-naturedly tolerate the issue of counterfeit money by the merchants when it does not allow it for governments, even when these are cautious enough to prepare for the bankruptcy by a slow depreciation which affords the holders of the papers the possibility to evade it? This possibility does not exist for the holders of the securities issued by trade. Bankruptcy strikes them like a thunderclap. Many a man goes to sleep tonight in possession of 300,000 francs and wakes up tomorrow with no more than 100,000 as a result of a bankruptcy. The National Convention copied this manoeuvre in the operation of the Consolidated Third [212]; people did not tire of reproaching it with this as a fully established robbery. And yet every merchant is allowed the right to commit still more vexatious robberies and to steal by bankruptcy two-thirds of what he received, whereas the Convention withheld two-thirds of sums it had never received. How outrageous the crimes of trade become when compared with other, and even the biggest, political infamies!’

The following details will demonstrate that modern politics, by handing over trade to completely free merchants exempt from any kind of obligation, has set the wolf among the fold and provoked robberies of all kinds.

Let us now go on to bankruptcy to describe it in somewhat greater detail.