The reflection of Sismondi on Marx

By Umberto Mazzei

Geneve, January 2016


The physical well-being of man, so far as it can be produced by governments is the object of Political Economy



Marx, in his most well-known book, Capital, mentions almost all of the economists that existed since Classic Antiquity up to the last quarter of the XIX century. Adam Smith, David Ricardo and Jean Charles Sismondi are the most quoted. Marx sees Smith and Ricardo in a simple manner: as antagonists. With Sismondi the relation is a somewhat more complex one. Sismondi was the first to denounce the evils of the capitalist system that emerged from the French Revolution and the Industrial Revolution. Sismondi was the first to contradict Smith up to a certain extent and very much Ricardo’s economic theory. Marx sees him as a rival. A rival whose basic principle is that a more equality oriented wealth distribution, enforced by governments, can be the engine for a stable general economic growth. For Marx it was an undesirable proposition, because he believed capitalism as unredeemable and doomed to destruction. That could explain Marx’ ambivalence towards Sismondi, who he sometimes praises, sometimes omits to quote and even distorts or disqualifies. 


For this first research on the influence of Sismondi in Marx, the source for Sismondi’s economic ideas are his Nouveaux Principes d’Économie Politique in the 1827 edition and his Études sur l’ Économie Politique of 1837. The sources for Karl Marx’ ideas are the Communist Party Manifesto and the First English edition of Capital, because it was authorized by Marx himself who also wrote an author’s preface for it, while the editor’s preface was written by Frederich Engels. 


Sismondi’s social approach


We will approach the rapport between Sismondi and Marx from the perspective of Sismondi, because he lived, studied, thought, wrote and published extensively before Marx even existed and while there are many of Sismondi’s ideas in Marx, obviously there is no influence of Marx on Sismondi. During the whole of the XIX century all critics of the capitalist industrial revolution referred to Sismondi; his thinking and discoveries have gone well beyond this time.  It is well worth exploring and studying him now, when facts once again confirm his forecasts and the economic distortions and social damage that he criticized then have now been repeated, on a much larger scale, because the economic system remains the same, unchanged and even worsened.


Sismondi was a concerned and cosmopolitan philosopher who moved with great ease between the intellectual world of Switzerland, France, Italy and England, during the time of the Napoleonic Wars and their long sequels. He was a prolific writer on literature, history and economics and his work shows an innovative analysis technique, an acute realistic judgement, a social perspective, and a universalistic dimension.


His friend and compatriot, Mme. de Staël, described him in Corinne as a man of “deep wisdom” who spoke with “authority”. Stendhal, the great writer from Grenoble, carried with him the works of Sismondi wherever he went, and in his Lucien Leuwen he included Sismondi among the three favourite writers of the novel’s main character, together with Goethe and Walter Scott. The famous historian Charles Augustin Sainte-Beuve, member of the French Academy, devoted much space to Sismondi in his memoirs Nouveaux Lundis. The most illustrious British magazines published Sismondi’s works. Sismondi was also well known in Spanish America, and he makes accurate and interesting commentaries on the role and purposes of British finance on its separation wars from Spain. Domingo Sarmiento puts him as a political philosophy reference in his Facundo (1845). But the reference to Sismondi that is best known today came from the then unknown Karl Marx, in 1847, in his Communist Party Manifesto. Marx was obviously impressed by Sismondi and believed him worthy, because he was the only economist mentioned there, even if afterwards he disqualifies the quality of his social sense.


Indeed, Sismondi, quite before Marx, was the first to dissect and analyse the origins, consequences and contradictions of the capitalist production system. He wants to reform the system; he wants to make a more equitable distribution of wealth, to improve job stability and to balance production for a general well-being, to limit the power of the unbridled bankers and industrialists, through the intervention of the State. He wants to reform the system immediately and demonstrates clearly and specifically that a more equitable distribution of wealth is beneficial to economic stability and growth. Something akin to the principles that guided Bismarck in Prussia and Germany since the 1860s, but far from the radical messianic proposal of the theoretic anti-capitalistic system that Marx developed later.


Sismondi sees work as the only genuine source of value, abundance and wealth. He is the first to analyse the structural causes of the poverty and misery imposed worldwide on workers by the industrial revolution. He is the first to talk of class struggle and the exploitation of the proletariat, while looking for a practical, fair and immediate solution. In his opinion the workers’ misery has four major causes. a) the appropriation of the surplus value of labor by capital; b) the precariousness of employment, exacerbated by the automation of the production process; c) an excess of capital that fuels an overproduction that saturates markets, bankrupts industries and causes unemployment; d) the loss of a social structure that allowed the worker to balance his offspring with his livelihood. Sismondi believes his contribution to the science of political economy is to fill a gap left by Adam Smith, concerning wealth distribution. That is the reason, for his main economic work to be titled New Principles of Political Economy or about Wealth in its relation to population.  


His proposals to improve wealth distribution would be, especially for today’s global crisis, feasible innovations, but that would be inconvenient for entrenched privilege. Proposals like: a) to give workers a share in the profits and eventually a stake in ownership of the companies where they work; b) to absorb the increase in productivity resulting from the automation and technological improvements with decreased working hours without reducing wages; c) to improve education, to induce an awareness of reproductive responsibilities; and d) to control the freedom of banks on emitting money, credit and debt.


Sismondi thinks that the State should be the guarantor of a harmonious relationship between labour and capital, for mutual benefit, because good salaries expand and invigorate the market, while expanding property among workers makes a more just, happier and stable society.


An interesting detail of Sismondi is that even then, almost two hundred years ago, he criticizes four features in the capitalist system whose monstrous development threatens the entire world economy today. The first is the idea that governments should abstain from interfering in financial affairs and that central banks should be free to carry an autonomous policy. Sismondi says money and its facsimiles are public goods and therefore the State should be vigilant and keep control over its issuance and circulation. The second one is his criticism of the United States which he describes as an economy  based on debt, structurally bound to funding speculation and seeking maximum and fast profit as the only measure of success. The third is the deliberate use of loans that will be defaulted, loans for political subjugation of insolvent countries and it is there when he describes the case of England in Spanish America. The fourth is the damage and misery caused by subsidized exports from industrialized countries on developing countries’ economies and sees export dependent economies as victims of an excess of capital that makes them intrinsically unstable.


Another particular merit of Sismondi is that he is the first to place economic growth in a sociological frame and to look at the progress of the wellbeing mass in a global scale


Marx’s social perception


Karl Marx sees misery and deprivation as redemptive forces. His theory assumes solidarity among oppressed workers, which would overcome the call of selfishness and individual urgency. It will feed itself for action from their common rage and will be consciously channelled towards worldwide liberation from the oppression of the ruling classes. Marx sees the working class miseries as the element whose increase and accumulation will reach an unbearable level for the majority of the poor and cause a violent and uncontrollable social explosion. It is bound to happen because of a dialectic process where the theme is only economic, materialistic, and whose mechanics make a revolution against bourgeois capitalism, a historically unavoidable event.


He names his forecasted explosion, the Proletarian Revolution, which will nullify the private property system which for thousands of years has oppressed the working class under the proprietary classes. An oppression that has become worse since the French and Industrial revolutions which brought about bourgeois capitalism.


Marx proposes a ten-point program, first outlined in the Manifesto of the Communist Party and then developed in his book Capital. This programme shows very clearly the intellectual antecedents of his theory, which are also confirmed by the bibliography listed in Capital. His theory combines many ideas and observations of those authors, while commenting on a wide range of human activity from antiquity up to his contemporary society. Marx developed a huge, keen, detailed and erudite description of ancestral class conflict, which he brilliantly combined with acute economic dissections of the capitalist production process, underlining its unfairness and exploitative character. He believes Bourgeois Capitalism is the last manifestation of working class exploitation that through a dialectic process has reached its historic end, culminating in a final struggle. The poorest among the poor, the proletarians, would prevail and seize power to rule through a Proletarian Dictatorship imposed on the owners’ class.


Under that government, the system of private property would be cancelled, by gradually subtracting capital from the bourgeoisie and centralizing all means of production by State ownership. In the end private property will be abolished and there will be no more classes or distinctions and all means of production will be publicly owned. Unexpectedly, Marx considers including women among them. 


The reasoning process that Marx follows to reach his conclusions and make his forecasts are obviously speculative and not always consistent, but they are very convincing, because people like to believe in what they would like to happen, particularly when they are desperate, full of anguish and hate. The list of the many authors that Marx quotes expands from Moses, Homer, Aristotle, Plato, Xenophon and Antipharos, all the way past the luminaries of the Mercantilist, Physiocrat and the Liberal economic schools up to social philosophers like Hegel, Carlyle, Darwin and Engels. Among the economists, as we already said, Adam Smith, David Ricardo and Jean Charles Sismondi are the most quoted.


Marx is not known for being benevolent with those authors that lent him ideas and that he frequently omits and forgets to quote. It is strange that there is no mention of François Grachus Babeuf in Capital, even if he was the first to speak of communism as a modern political proposal, during the French Revolution. It is not for lack of documentation, for Babeuf was a journalist that left a long trail of documents and who forged a consistent and popular doctrine: babouvism, which cost him his life. He is mentioned in the Communist Party Manifesto, but only once. It seems a feature of Marx’s character, because in his time, Marx was often criticized for appropriating other people’s ideas, for changing the meaning of conventional economic terms, for copying without quoting and for distorting quotations. Hints of such behaviour can be found in the preface by Friedrich Engels, to the fourth German edition which can be seen in the first English edition of Capital, when he contradicts those accusations.


Another curious tendency of Marx is to criticize and dismiss authors that gave him inspiration and over whose ideas he has very obviously built his own theories. Such is the case with Georg Wilhelm Hegel. Marx takes Hegel’s dialectical interaction method of interpreting history based on cultural conflicts and makes it his own by reducing it to conflicts of an exclusively economic class, which he calls dialectical materialism. Then he claims that “my dialectic method is not only different from the Hegelian one, but it is its direct opposite.


Another similar case is that of Sismondi, from whom he copies the method of economic analysis, including his definitions and some of his examples, his perception of class struggle and his concerns over wealth concentration and the proletarization of the working class. Then he labels him petty bourgeois socialist.


He also dismisses Proudhon, and when he explains why, the reason for that socialist rivalry appears more explicit. These socialistic bourgeois want all the advantages of modern social conditions without the struggles and dangers necessarily resulting therefore… They would like a bourgeoisie without the proletariat..this socialism sought to depreciate every revolutionary movement in the eyes of the working class, showing that a political reform is not enough, because only a change in the material conditions of existence and economic relations can be advantageous for themBy changing the material conditions of existence, this form of Socialism, however, by no means understands the abolition of bourgeois relations of production – an abolition that can only be effected by a revolution – but only administrative reforms. It is clear here that it is not the immediate welfare of the working classes which Marx pursues, but the realization of a dream, a dream of a violent revolution to end the present bourgeois conditions of production, but with only a foggy and not very defined plan as a substitute for it, because the Dictatorship of the Proletariat, without institutional developments that define its political organs and a profile of its proposed method of production, as Marx says over  Proudhon socialism, it becomes a mere figure of speech.


This gratuitous disregard reaches other worthy and very well known previous socialist figures like Saint Simon, Fourier and Owen, who are bound together in the Communist Manifesto under the category of utopian socialists.


Claude Henry de Saint Simon (1760 – 1827) coined the term industrialization and founded the “organismic positivist” school, whose theory of organic evolution served Marx well for much of his doctrine of social evolution.


Charles Fourier (1772 – 1837), coined the term feminism and defended gender equality. His first book was The social destiny of man. Fourier proposed a social reconstruction based on experimental community associations that he called phalanges, where the social product would be distributed according to social needs, and allocation of responsibilities was done according to the intellectual faculties and individual inclinations, in order to make work a pleasure. There was also a decent minimum salary for those who could not work. His influence on Marx’s vision of a classless society, with equal conditions of education and income, is evident.


Robert Owen (1771 -1858) was an industrialist, who wrote A new vision of society, from which came the socio – political school that first carried the name Socialist. Owen thought that the loss of a sense of community was the main problem of the industrial revolution in England. Over this concept he developed the idea of building a model city for workers in his textile factory of New Lanark. There, working hours were shorter, wages were high and children had free education… Afterwards, because of the success of that first experiment, he built another workers city in Harmony, Indiana, United States. The basic objective of Owenite socialism was a rational human happiness, an idea shared by Bentham, but of which there is no trace in Marx. There is instead another Owenite idea that Marx elaborated on: the importance given to breeding environment in the future behaviour of the individual. Ironically enough, the Owenites regarded Marx as a simple closet theorist


Marx labelled them together as utopians, although technically their only feature in common is their desire to improve society and to have served him as a source of ideas. The reason for that is explained by Marx himself, who accuses them collectively of wanting to improve the condition of every member of society, even that of the most favoured… Hence they reject all political and, especially, all revolutionary action: they wish to attain their ends by peaceful means. Those words hint there is some venom in his wish for revolution at any cost. He then admits: they are full of the most valuable material for the enlightenment of the working class. The practical measures proposed by them – such as the abolition of the distinction between town and country; abolition of the family, of private gain and of the wage system; the proclamation of social harmony; the conversion of the functions of the State into a mere superintendence of production. All these proposals point solely to the disappearance of class antagonisms which were at that time just cropping up… Then he groundlessly concludes: These proposals, therefore, are of a purely utopian characterr.


It is likely that his hostile disdain for well known authors that shared a concern for improving the condition of workers and requested a more equal wealth distribution, is due more to his tumultuous character and disorderly and aggressive temperament than to personal meanness.


In the specific case of Sismondi, he is somehow presumed by Marx to be part of a ruined aristocracy or of a new class of petty bourgeois and summarily appoints Sismondi as the group’s head economist. In the Communist Party Manifesto, Chapter III, on Socialist and Communist Literature; in group b) petty bourgeois socialism, Marx  explains that “In countries such as France where the peasants constitute more than half of the population it was natural that writers who sided with the proletariat against the bourgeoisie should use in their criticism of the bourgeois regime, the standard of the peasant and petty bourgeois and from the standpoint of these intermediate classes fly the cudgels for the working class. Thus arose petty-bourgeois socialism. Sismondi was the head of the school not only in France but in England.


Then he adds something that explains why he may want to dismiss Sismondi: This school dissected with great acuteness the contradictions of modern production. It laid bare the hypocritical apologies of economists. It proved, incontrovertibly, the disastrous effects of machinery and division of labor, the concentration of capital and land in a few hands, overproduction and crises; It pointed out the inevitable ruin of the petty bourgeois and the peasant, the misery of the proletariat, the anarchy in production, the evident inequalities in the distribution of wealth, the industrial war of extermination between nations, the dissolution of old moral bonds, of the old family relations, of the old nationalities.


In its positive aims, however, this form of socialism aspires either to restore the old means of production and of exchange within the framework of the old property relations, and the old society, or to cramping the modern means of production and of exchange within the framework of the old property relations that have been, and were bound to be, exploded by those means. In either case it is both utopian and reactionary.


Nowhere, either in the Manifesto of the Communist Party or in Capital has Marx – who otherwise likes to get involved in minutia and detail – explained the reasons why he says such things. It seems misplaced to qualify Sismondi as a reactionary to Marx’s revolutionary proposals, because Sismondi published his New Principles of Political Economy, in 1919 and 1827, and his Studies on Political Economy in 1836, well before Marx called for a Proletarian Revolution. His labelling of Sismondi as a utopian is so unjustified that today we can believe, looking back, that his proposals would have saved much suffering to the working class by a fairer distribution of wealth, which still is a very modern concern. Marx has some responsibility in the delay for two hundred years of those still and increasingly urgent reforms.


Marx finally concludes saying about Sismondi: “His last words are: corporate guilds for manufacture; patriarchal relations in agriculture”. It is a completely fabricated and unjustified statement. Sismondi clearly says in his New Principles of Political Economy and in his Studies on Political Economy that he does not want the return of the old corporations and criticizes their tendency toward monopolistic behaviour. What he actually said is that we must find ways to give again the stability to employment and production that the old corporations gave, despite their flaws. He then made new proposals that are still valid to this day, such as employee participation in the benefits of production and a minimum wage. As for agriculture, Sismondi explicitly rejects patriarchy as a form of production. What he actually counselled was agricultural production by widespread small properties that are known to provide greater food security and more stable employment to farmers, while stimulating better quality, a wider range of production and a more equitable wealth distribution, something well proven to this day with modern cooperatives. As he said himself: No, I don’t want a return to the past, but I want something better than what we have today ….It is not against the machines, it is not against the discoveries, it is not against civilization that I bring my objections, it is against the modern organisation of society…. Today it is not the discoveries that are wrong; it is the unfair partition that men do with its fruits


The Sismondi in Marx


To study the influence of Sismondi’s ideas in Marx, the obvious first step is to look at how many times Marx quotes Sismondi in the first volume of Capital – it is the volume where he quotes him the most, and it is the only one of the three volumes, which Marx edited personally. Our analysis technique will be to identify in Marx the quotations of Sismondi’s text, expose them, then examine the context in which Marx quotes them, quote his commentaries and provide ours.


Marx does not always belittle Sismondi and for good reason, because there is much of Sismondi in the best of Marx, as much at least as there is from Hegel. So says Maximilien Rubel in his Marx, critique du marxisme. Obliquely, it is also Marx who says that himself: Sismondi is as important as Ricardo; the history of modern political economy … is complete with Ricardo and Sismondi: two antipodes. He continues on the same subject: Ricardo’s analysis is often absurd. Sismondi, by contrast, shows not only the existence of these production limits but shows how capital itself creates them and is enclosed in its own contradictions. Later on, talking about Surplus-Value – a basic element in the production process discovered by Sismondi- Marx continues: For Sismondi crises are not accidents, as for Ricardo, but essential explosions. This praise adds to the praise already mentioned in the Manifesto of the Communist Party.


Sismondi’s influence on Marx’s work is large, undeniable and obvious. Sismondi is the one who replaced the three classes in the Tableau of Quesnay with only two classes, fighting each other: the owners of capital and the wage-workers. Sismondi is the one who discovered the economic scheme of a circular movement of national income where each effect becomes in turn a cause and every step is regulated by the one that precedes it and determines the one that follows it and the last returns to the first order. The national income should regulate domestic spending, and that should absorb …the whole production, which when it fully absorbs the output at the bottom of the circulation determines a reproduction equal or above it. It is Sismondi who first identified the abstract relations of production in the framework of the capitalist world, where income, profit, business profits and interest on capital are seen under their general form of capitalist rent; where consumption is divided into two: indispensable consumption to keep the workers alive and luxury consumption reserved for the capitalists. This scheme is entirely taken by Marx in his scheme of reproduction, but at the same time he criticizes Sismondi for the way he explains the transformation of income into capital.


The first volume of Capital has a structure which, while offering a different order, continuously exposes issues already addressed by Sismondi in his New Principles of Political Economy and paraphrases the essence of his arguments, but the conclusions are not always the same. The essential difference between Sismondi and Marx is the way they approach private property. Sismondi believes that private ownership is a source of wealth that should be distributed in a more equitable way to everyone, through a reform of the capitalist system because violent solutions are cruel and ephemeral. Marx believes that private ownership is a form of violence which from time immemorial is imposed by a minority upon a majority; therefore it should be abolished and that – he says – can only be genuinely done with a violent revolution.


But there is agreement in many issues. In his preface to the second English edition of Capital, Marx says that Ricardo takes class conflict in England as a social law of nature and admits that “already in Ricardo’s life, he found opposition and criticism in the person of Sismondi. In Capital, Volume I, Chapter I – The goods, when Marx speaks of the difference between use value and exchange value, there are phrases with identical content as those of Sismondi, only more elaborate. Sismondi says that among the elements that compose the price of the producer labour is the most important; and up to a certain point, it regulates the others, because there is a necessary salary, under which even competition can not reduce workers for a long time. Marx says: The equality of all forms of human labor is expressed objectively by their products all being equally values; the measure of the expenditure of labour power must assume the form of the amount of value of the products of labour.


In Capital, Part II Transformation of money into capital, Marx makes Sismondi’s definition of capital his own and paraphrases it, but then he only quotes his shortest definition. Sismondi explains that the notion of capital arises from the existence of society because a man alone has no use for excess production. He shows that it is a production above the own need which allows to hire people in exchange of a surplus. He then describes  how it is the existence of a society, and the introduction of exchanges, what allows  to multiply almost infinitely these seed (wheat) this fruitful part of accumulated wealth, and it the one that we name capital, which is used to pay other people for help. This extra help further increases production and it forms a new capital. Before the producer consumed his own surplus as a rent, but once it was employed to feed productive workers; …against work…, it becomes a permanent value, which perishes no more; it was a capital. This value is separated from the merchandise that created it; it remains as a metaphysical and insubstantial quantity.


Marx said that, only when the money takes the form of a commodity, it becomes capital and is a wonderful means whereby out of money to make more money…. By its mere circulation goods have value and that is how the circulation of capital occurs suddenly as an independent substance, endowed with a motion of its own, passing through a life process of its own …Nay, more : instead of simply representing the relations of commodities , it enters now, so to say, into private relations with itself …It comes out of circulation, enters into it again, preserves and multiplies itself within its circuit, comes back out of it with expanded bulk, and begins the same round ever afresh.  


After this poetic description by Sismondi and the very similar and somewhat picturesque of Marx, both of them describe how commercial capital and industrial capital always operate buying at a lower price than the one they sell at. The first buys goods and the second buys inputs that are turned into goods. At this point, Sismondi already hints at Surplus – Value, which he will later on explicitly describe, when he says: the worker has labour as his only income …while his work becomes capital for his employer.  Sismondi then goes on to describe the division of labor and how it gave birth to the different classes and increased the submission of those that are born without other income than their ability to work. He explains then how the reduction of work to simple and repetitive operations increases the dependence on the employer and the brutalization of the person, another issue that will be dissected by Marx.


In Part II of Volume I of Capital, Chapter VI Buying and selling of labor power, there is again the obvious influence of Sismondi, which is indeed, quoted. Sismondi says: Regardless of the opposition we have established between the revenues that come from wealth and those who have only a potential to work, there is however, an essential relationship: they have the same origins, but from a different time. Among those who share the national income, there are some who buy every year a new right with a new work done, while others have acquired a permanent right by a previous  work … that makes every year’s work more productive.


As for the specific sale of labour power, Sismondi says and Marx partially quotes him: The poor, because their only income is their work, depend, before they spend it, on the upper classes. They need to do some work; they need to sell it before enjoying its fruits… The power to work gives an income only when it is used; capacity for labour is income only when it is employed; it is nothing unless it is sold


Concerning the same issue, Marx explains: When we speak of labour, or capacity for labour, we speak at the same of the labourer and his means of subsistence, of labourer and wages. When we speak of capacity for labour, we do not speak of labour, any more than when we speak of capacity for digestion we speak of digestion. This latter process takes more than a good stomach. When we speak of capacity for labour, we do not abstract from the necessary means of subsistence. On the contrary, their value is expressed in its value. If this capacity to work remains unsold the worker does not derive any benefit from it, and at this point he quotes in a note that last phrase of Sismondi.


Surplus Value


In New Principles of Political Economy, book II, Chapter V, Sismondi describes Surplus Value and identifies it with the name mieux-value. He will also refer to it in detail in a later work, Études sur l’Économie Politique (1837). Marx quotes him when he explains the concept of surplus value and describes it, but then elaborates over and goes to explain his notion of a relative surplus value. Very much like what he did with Hegel’s dialectic method of analysis.


When Sismondi explains the distribution of the national income between the various classes of citizens, he says that there are three permanent sources of wealth: the first is land, which has a spontaneous force that man can direct; the second is the capital used to pay for labour; the third is life, which gives the power to work. All three, he says, have a direct relationship with work and without work, there is no wealth.


He then describes how that relationship works in agriculture and industry. Unlike agriculture, he says, the power of the factory to produce is entirely as a result of previous work by men, who designed and built it… Factories bring into play forces infinitely superior to those of man, the movement of the air, the water, the steam; and their output, at least wherever the land became property, is more profitable than that from agriculture …. Compared to land, industry needs only the other two sources of wealth: life that gives the power to work and a capital that pays for it. When these two powers meet, they have an expansive force and the work that the worker will do during the year, will always be worth more than the labour he did the previous year, which is the one that will maintain himself. It is because of that Surplus Value, which is much greater than that of the progress the arts or science in their applications to industry, that there is a constant increase in the production of wealth. This growth can either increase the income of the working class or be added to capital. But, in general, very little of the capital that pays salaries and makes it possible remains in the hands of those who work. It turns out that there is an unequal distribution between the capitalist and the worker, where the capitalist strives to leave workers only what is necessary to keep them alive and reserves for himself everything that the worker produced above the value of his life. Workers, meanwhile, struggle to keep as much as possible from the work he does.


Marx develops this theme on the same conceptual basis, but takes it to a level of working hours. He assumes that the value of one half of the working day is enough for the subsistence of a worker and the other half day that the worker also works is appropriated by the capitalist. He assumes a 12 hour working day and divides the work into necessary labour and superfluous labour, then he makes an arithmetic demonstration with given values and elaborates on a difference between Surplus Value and a relative Surplus Values: The surplus value produced by prolongation of the working day I call absolute surplus value On the other hand , the surplus value arising from the curtailment of the necessary labour time and from the corresponding alteration in the respective lengths of the two on  the working day, I call relative surplus value.


This last definition which explains the title of Part IV Production of Relative Surplus Value should have preceded perhaps a previous long paragraph where Marx explains what he means by increase in the productivity of labour and where he also quotes Sismondi. By increasing the productiveness of labour we mean, generally, an alteration in the labour process of such a kind as to shorten the labour time socially necessary for the production of a commodity, and to endow a given quantity of labour with the power of producing a greater quantity of use-value.


At this point Marx quotes Ferdinando Galiani in Della Moneta and also quotes Sismondi, when he says Saving in the expense of production is necessarily saving in the quantity of work used for production. This quote of Sismondi is inaccurate, out of context and not in the work and page mentioned. It comes from a paragraph in the introduction of his Études when Sismondi explains how international competition is causing universal harm: If everyone works to increase his production, everyone works also to produce cheaper, and each of those actions is the necessary consequence, the complement of the other. If as we said, wealth is the fruit of labour; saving on the production expenses cannot be anything else than saving in the quantity of labour or saving on the retribution of labour. For Marx the hue in Sismondi’s real phrase runs counter his simplification.




Regarding wages, Sismondi also anticipates some of Marx ideas and Marx recognized it and quotes him in Part VI, Chapter XIX of Capital, where he pretends mistakenly that Sismondi had said, in one of his first works, De la richesse commercialeThere must be an agreement by which whenever there is an exchange between labour done for labour to be done, the capitalist must receive more value than the worker.


Again Marx distorts and quotes Sismondi out of context. That phrase or something that resembles it is found in the aforementioned book, in Chapter I – the Capitals, when Sismondi explains how, at the beginning of society, the exchange between work and salary started: Since every man is forced to consume before producing, the poor worker finds himself depending on the rich, and he cannot live or work if he does not get the food and goods already existent against those he promises to make with his work. That exchange cannot be gratuitous…It must be agreed that every time they exchange work done  against work to be done, the last one will have a value superior to the first, or in other terms, that the proprietary of the accumulated surplus will get a profit proportionate to his advances.     


But Sismondi in his later book, New Principles of Political Economy, Book IV, Chapter V-wages, that Marx obviously knew and quotes frequently, but avoids to mention when it concerns salaries, says much more than that, and we found obvious traces of his ideas in the way Marx approaches the issue.


Sismondi says that among the elements that are taken into account for fixing the producer price in the market, labour is the most important because it regulates all the others. Because there is a necessary salary….whilst the reduction in interest in the money or the capital gains, which are the other elements of price, seem to be able to go on forever; the low price of labour generally allows producers to establish their product at the best price… but the price of labour can be low, in reality or nominally, while the work is exchanged against an insufficient quantity or there is an overabundance of things necessary to live. Money isn’t the only sign of the exchange… he has not received it early enough so that it can be used to buy provisions that are needed. If these are at a low price and if his working day can be traded not only for what is strictly needed but for a quantity… (which gives him) the feeling of being at ease. We often consider low labour prices as national advantage without wanting to explore whether it is real or nominal. We have hired their patriotism, the manufacturers who refuse to increase the wages of their workers, and the governments who have seconded them by fixing the workers salary’s rate and forcing them to stay… it is not the profit of the manufacturer which holds the national interest. It’s the benefit that the manufacturer distributes to all the parties who have contributed… the nations strengthen when their revenue increases but not when the income of one class usurps the income of another… the salary is not just a recompense for work done calculated hourly after it has finished. It is the revenue of the poor. And as a consequence of this it must not only be enough to look after them during their working period but also in sickness, it must fulfil their childhood and their old age just as in the prime of their life. In sickness and in health


Marx treats wages in several very detailed chapters. In Chapter XIX he says that Classical political economy borrowed from every day life the category “price of labour” without further criticism, he then simply asked how this price is determined… As with other commodities, this value is determined by the cost of production.


In Chapter XX Time-wages, Marx analyses them and finds that wages can take many forms. First by working time for payment, where the distinction between the exchange value of labour power and the sum of the necessities of life into which this value is converted, now reappears the distinction between nominal and real wages The sum of money which the worker receives for his daily or weekly labor forms the amount of his nominal wages. But it is clear that according to the length of the working day … the same wage may represent very different labour prices … It follows therefore, that the daily and weekly wages may remain the same, although the price of labour falls constantly. If for example, the normal working day is 10 hours and the daily value of labour is 3 s., the price of the working time is 0.3s. It falls to 0.25s when working hours up to 12 hours… The same result is obtained if instead of the extensive amount of labour the amount of intensity is increased.


Then Marx, in Chapter XXI,  speaks of payment by piecework completed and looks into the international competitiveness of labour in his Chapter XXII where he says that the quality of labour is here controlled by the work itself, which must be of average perfection if the piece-price is to be paid in full,….Piece work has, therefore, a tendency while rising individual wages above the average , to lower this average itselfMarx. Ibid. Part VI, Chap. XXI, Pag. 272- 274….and then in a sharp analysis he concludes that even if frequently workers may earn more with this system, the price per hour and the lapses of unemployment frequently lower the total gain. 


On Chapter XXII- National differences on wages- Marx states quite appropriately that In the comparison of the wages in different nations, we must therefore, take into account all the factors that determine changes in the amount of the value of labour power; the price and the extent of the prime necessities of life…But the law of value in its international application is yet more modified by the fact that in the world market the more productive national labour reckons also as the more intense, provided that the most productive nation is not compelled by competition to lower the selling price of its commodities to the level of their value. Even if Marx analyses very acutely the whole wages issue and hints at an international perspective, it is noteworthy that Marx discusses nowhere the damage done by this international competition to foreign workers and to their labour stability, like Sismondi does over and over. Neither does Marx approach aspects of Social Security for unemployed, sick or old workers as Sismondi was the first to do, followed by some of Marx contemporaries, such as the detailed proposals by John Ruskin in his Unto This Last.


The reproduction of capital


The reproduction of capital is another issue addressed by Sismondi and then Marx, which quotes him. In his New Principles of Political Economy, Book II, Chapter IV – How capital income is born, Sismondi says that Trade, which is the generic name we give to the entirety of exchanges, complicates the relation that should exist between production and consumption but increases their importance … But since each one works for everyone , the production by all must be consumed by all, and each should have in view, when producing , the  final demand of society … that demand is imperfectly known, but is know to be limited.


Continues Sismondi: Society … to avoid ruining itself, can only consume its annual income, if it would diminish its capital, it would simultaneously destroy its means of reproduction and its future consumption. Everything it produces is destined for consumption and if the annual production, when brought to the market has no consumers, production will be suspended and the nation will be ruined in the midst of plenty. It is a situation that repeats itself in modern times.


Sismondi says that understanding the nature of what is capital and what is income is the most abstract and the most difficult question of political economy, the nature of capital and income are constantly confused… We see that what is revenue for one becomes capital for another, and the same object, in passing from hand to hand, receives different names. Meanwhile, its value, which is separated from the consumed object, seems  a metaphysical amount that some spend and others exchange, that perishes with the object itself for someone and is renewed for another and lasts as long as the duration of the circulation.


The workers exchange their labour for a salary which is his income and that labour becomes a capital for the capitalist owner, who exchanges it against another capital where each keeps his own under a different shape, until it reaches the final consumer who buys it with his income.


As only labour has the power to create wealth…. all capital must be used in creating work, because all wealth…. must be exchanged against a future wealth that labour should produce …. The benefit of an entrepreneur often is nothing other than a plundering of the workers he hires; he doesn’t make a gain because his company produces much more, but because he doesn’t pay all the cost. Sismondi distinguishes between fixed capital and working capital, and a third form which is the value on which the finished product exceeds the investments made: these value is what we call income from capital and is intended for consumption.


It is unexpected that, when Marx quotes Sismondi in this topic, he does not mention the Chapter and only refers to the Nouveaux Principes edition of 1819, which also is the one he mentions in Capital‘s bibliography. That text was revised in the 1827 edition, which Marx knew well because he quotes from it in Capital and in other works. The substantial part of that quotation from Sismondi says: Wealth, alike work and through work, produces an annual fruit, which can be destroyed every year without a rich man becoming poorer. This fruit is the income that arises from the capital.  This phrase is found in Nouveaux Principes, BookII, and Chap.III of the 1827 edition


Marx’s explanation continues and expands Sismondi’s arguments. In Capital, Part Seven- The accumulation of Capital Marx says: The conversion of a sum of money into means of production and labour power is the first step taken by the quantum of value that is going to function as capital. This conversion takes place in the market, within the sphere of circulation. The second step, the process of production is complete as soon as the means of production have been converted into commodities whose value exceeds that of its component parts and, therefore, contains the capital originally invested, plus a surplus value. These commodities must be then thrown into circulation. They must be sold, their value realized in money, this money converted afresh into capital and so on over and over again … The capitalist who produces surplus value –  who extracts unpaid labour directly from the labourers, and fixes it in commodities – is, indeed, the first appropriator, but by no means the ultimate owner of this surplus value. He has to share it with capitalists, the owner of the land, etc., who fulfil other functions in the complex of social production. Surplus value, therefore, splits up into various parts. Its fragments will fall into various categories of persons and assume various forms, independent of each other, such as profit, interest, merchant’s profit, rent, etc… As far as the process of accumulation takes place, the capitalist must have succeeded in selling his commodities and in reconverting the sale money into capital.


In Chapter XXIII, which follows the introduction that we quoted, Marx finds that Whatever the form of production in a society, it must be a continuous process….a society can no more cease to produce than it can cease to consume…and every social process of production is, at the same time, a process of reproduction … But the labourer is not paid until after he spends his labour power, and realized in commodities not only its value but its surplus value…But that process must have had a beginning of some sort … it seems likely that the capitalist, once upon a time, became possessed of money by some accumulation that took place independently of unpaid labour, and that this was , therefore, how he was enabled to frequent the market as a buyer of labour power


Later on, when Marx explains how capitalist production perpetuates the condition for exploiting the labourer, he quotes a phrase of Sismondi over the inferiority of worker’s bargaining condition, in a note:  A worker asks for subsistence in order to live, the boss asked for labour to make a profit


Later on, in Chapter XXIV Conversion of surplus value into capital, Marx says from a concrete point of view, accumulation resolves itself into the reproduction of capital on a progressively increasing scale. The circle in which the simple reproduction moves alters its form, and, to use Sismondi’s expression changes into a spiral. Marx complements this reference to Sismondi, with a note where he says that Sismondi’s analysis of accumulation suffers from the great defect that he  contents himself to too great an extent with the phrase “conversion of revenue into capital,” without fathoming the material conditions of the operation. An appreciation obviously unfounded because, as we saw synthetically, Sismondi devotes Chapter IV and Chapter V of the Second Book of his New Principles of Political Economy to study the transformation of revenue into capital, besides  returning on that subject in other chapters. It is true that Marx devotes much more space: all the Seventh Section and its seven chapters, but it is also true that all that space has many quotations recalling Sismondi.


Always talking on the conversion of surplus value into capital, Marx relieves another point of coincidence that he artificially presents as in controversy with Sismondi: it concerns the origin of the first seed capital that hired the first workers from which the first surplus value was extracted.


Marx assumes an original capital of £ 10.000, and then asks. How did the owner become in possession of it? “By his own labour and that of his forefathers” answer unanimously the spokesmen of political economy “and he goes to quote Sismondi in a note when Sismondi says “The original work to which capital owes its birth. Marx obviously wants to put Sismondi in the same bunch with the members the English liberal school, that seems to be his reason to omit that  Sismondi goes on to describe the ancestral origin when he says that The one that had provisions in reserve, offered to feed the one who’s granary was empty, on condition that this last one works for him. This nourishment given in exchange of labour was named salary.  Then, later on, he specifies that, once rent was used to feed productive workers; once it was exchanged against labour or against future products of labour … it became a permanent value, a multiplier one, that does not perish any more; it becomes a capital. That  specific remark is followed by a detailed description of how living in society brought exchanges of surpluses and then goes on to describe the difference between rent, capital and salary.


Marx recognizes afterwards that, indeed, Sismondi’s assumption seems to be the only consistent with the laws of commodity production. But even then, Marx insists: But it is quiet otherwise with regard to the additional capital of £ 2,000. How they originated we know perfectly well. There is not a single atom of its value that does not owe its existence to unpaid labor. There is not a shade of doubt that Sismondi would have also agreed that that £ 2,000 came from a surplus value of workers’ labour; because he had said exactly that 40 years earlier.


The Production Process


On the issue of surplus value Sismondi makes a reflection that explains the convenience for the capitalist to keep the poor apart from wealth and perhaps also the repugnance in Marx to the idea of turning workers into owners, into petty bourgeois, unfit to make a revolution. Sismondi says that: … thanks to the progress in the application of sciences to industrial production each worker can produce more and much more than his consumption needs. But while their labour produces wealth, if he were left to enjoy that wealth it would make him unsuitable for working.  That’s why wealth is almost never left in possession of the one who uses his arms to make a living Sismondi continuously reminds us that wealth always originates from work, but… although the worker in his daily labour has produced more than he spends in a day, it is rare that after sharing it with the landowner and the capitalist, he keeps much more than what is strictly neededSalary does not represent an absolute amount of work, but only a subsistence amount enough to keep alive workers from the previous year. The same amount of subsistence will move the following year, a quantity of labour more or less as big; and from the fluctuation in the ratio of these two values, results in the increase or reduction of the national wealth, the comfort or the misery of the productive class, the multiplication or destruction of the population.


The economic facts over commodity production and its important social and national prosperity implications, reported together by Sismondi, will be separated by Marx into several chosen statements when he speaks of relative surplus population. He will then run through Sismondi’s Book II, Chapter III – increased social needs of man, and limits production and Chapter IV – how rent is born from capital, ranging from page 79 to page 85, to build a somewhat incongruous speech, but that leaves the impression that Sismondi despises labour and approves the existence of a mass of workers available for exploitation. Marx attributes to Sismondi the finding that thanks to The indefinite multiplication of the productive powers of labour can then only have for result the increase of luxury and enjoyment of the idle rich. Sismondi – as we have seen- did indeed make a some how similar statement, but quite disapprovingly, while explaining the formation of wealth and its distribution among the different social classes


Explaining his laws of commodity production, Marx says:


Thus, the original transformation of money into capital proceeds in strict accordance with the laws of commodity production, as well as with the property rights which are derived from them.  Nevertheless, it has the following results:

1) The product belongs to the capitalist, not to the labourer.

2) The value of the product includes over and above the value of the advanced capital a surplus value, which has cost the labourer labour, while it has cost the capitalist nothing, and yet he is the rightful owner.

3) The labourer has reproduced his labour power, which can be sold again, if he finds a buyer.


After this statement, Marx adds: Simple reproduction is only the periodic repetition of this first operation. Every time it takes place money is transformed into capital. The general law is not violated; on the contrary, it finds the proper occasion to manifest itself continuously. At this point Marx quotes Sismondi, when he says:  “several successive exchanges have merely made of the last a representative of the first, This phrase was written by Sismondi in his Nouveau Principes, Vol. II, Formation and Progress of wealth, Chap.II Creation of wealth in society by exchanges, in the 1827 edition. That paragraph says that exchanges do not alter the nature of wealth, which remains always something created trough work… that it is the need of it which gives it value, even when another one replaces the producer at the moment of consumption… A man made it, a man saved it because a man need it and would consume it; it is of little importance if the man turns to be the same one, the intermediate exchanges make the last one the representative of the first.


Marx accepts and shares Sismondi’s elegant and streamlined description of the mecanics of exchanges, from production until consumption. What is however puzzling is that he doesn’t quote also the more elaborate description by Sismondi, that he also shares, of how merchandises become capital, which is what he is specifically talking about, and which Sismondi deals with in Chapter VIII How trade pushed production and replaced productive capital, in that same book II. It may be something attributable to the disorder with his papers for which Karl Marx was also notorious.



Then again Marx quotes Sismondi out of context when he comments on this previous quote of Sismondi. He says: Nevertheless, we have seen that the process of simple reproduction suffices to imbue this first operation – in so far as it was considered as an isolated transaction – with a totally different character. Here he introduces quotation marks and  paraphrases Sismondi “Among those who share in the national income, some” ( the labourers ) “ acquire every year a new title to it by new labour, while others” (the capitalists) “have previously acquired a permanent title to it by a primitive work”. Then he comments: The field of labour is evidently not the only one in which primogeniture works miracles. That sarcasm is misplaced if we consider what we already mentioned about Sismondi’s explanation of the production process and the origin of capital. Besides Marx here hints that Sismondi is a defender of primogeniture, while Sismondi, in many of his books, all over his New Principles, and specifically in its Third Book, over land wealth (sur la richesse territoriale), advocates the elimination of primogeniture.


As we already saw, the previous phrase quoted by Marx is to be found in Book Two, Chapter V Distribution of the national income between different classes of citizens. In it, Sismondi only describes the real world, which, indeed, is the pre-requisite of any science. There he analyses how the annual income of the capitalist production process in agriculture and manufacture is distributed. He points out that there is a class struggle in such distribution process whose results are important. That’s where that quote is located and is the proper context to interpret it. The specific paragraph also has a final phrase that Marx omits. It says:… a primitive work, which makes the annual work more advantageous. When Marx omits these last seven words, he eliminates the implicit reference to Fixed Capital and Circulating Capital and distorts the entire sense.  The complete paragraph from Sismondi says :  We have seen that regardless of the opposition between the income that comes from wealth and those that are only a work potential, there is an essential relation among them: their origin is the same, work, but in a different moment. Among those that share the national income, some acquire each year a new right by a new work, the others acquired a permanent right by a previous work, that makes annual work more advantageous.  


In his New Principles, Book II, Chapter VIII – How trade supports production y replaces productive capital. Sismondi makes some basic and elementary statements: There were never exchanges without benefit to both sides … one gets from the money he gets a better benefit than from his goods and the other gets more profit from the goods than from his money. Everyone wins and consequently the nation is winning twice. Similarly, when an owner puts a worker to work , he gives him in exchange wages corresponding to his livelihood, both sides have gained: the labourer  because he was advanced the fruit of his labour before his labour was performed; the master because the labour of the labourer is worth more than his wages, and the nation wins with both: because national wealth should be created, in a last analysis, with pleasure, everything that is more comfortable and increases individual enjoyment is a gain for all.


Again, this paragraph from Sismondi only describes reality in operation, but Marx, quotes him and makes a satire: “Both sides win: the labourer because he was anticipated the fruits of his labour” (read, the unpaid labor of other workers) “before this labour was performed” (read, before his own had borne fruit); “The master because the labour of the labourer was worth more than his wages”  (read lease, produces more value than that of his wages). Marx omits that last sentence which refers to a national and individual benefit.  Such vitriol is inadequate, because Marx knows very well that it was Sismondi who first discovered the appropriation by the capitalist of work’s surplus value and the first one to criticize it as unfair.


The concept of Proletarian


It was Sismondi who recovered from ancient Rome the word proletarian, which with synthetic capacity found in Latin, describes at the same time the tragedy, the social and economic role and the world vision of the impoverished working class that emerged from the industrial revolution. In his New Principles and in many of his multiple works, he elaborates on that theme. Sismondi presents it as mainly an English phenomenon and repeatedly explained that the allocation of land that took place in France during the French Revolution created a society where a better wealth and property distribution have created a more humane social ambience and wider political participation.


Sismondi describes the origin of the word and the meaning with a dramatic stroke: Therefore the more the poor are deprived of any property the more danger there is of misinterpreting their income and helping to increase a population which does not match the demand for labour so the subsistence level is not found. This observation is ancient enough to have passed in language, to have been passed from Latin through to modern languages. The Romans called those without property ‘proletarians’, as if, more than the others, their role was to have children: Ad prolem generandam.


In his foreword to the second edition of his Nouveaux Principes, Sismondi draws an anguished  picture of the effects of the unequal distribution of wealth in the British economy, nourished on David Ricardo’s liberal principles: Seven years have elapsed and facts have fought victoriously  for  me. They have proved, better than I could have ever done, that the wise men from which I separated myself were pursuing a false prosperity; that their theories, whenever they were applied, could increase material wealth, but…tend to make the rich richer and also the poor poorer…England has given birth to the most famous economists. Their science is applied today with renewed fervour. The English nation found it cheaper to give up the crops that require more manpower and they fired half of the farmers who lived off their fields; It found it cheaper to replace its workforce with steam engines. It laid off, hired and fired again its city workers; the knitters who lost their place to power looms (steam-powered looms) succumb to hunger today; it found it cheaper to reduce all workers to the lowest wage that workers can live on, who being proletarians did not fear plunging into even deeper misery, by always having larger families; it found it cheaper to feed the Irish only potatoes and to dress them in rags, it is why each packet-boat brings legions of Irish who work for less than the English, displacing them in all trades.


Sismondi mentions again the role of the  proletarians  in Nouveaux Principes, Sixth book, on Taxes, Chapter VI tax on consumption. He comments first on the unfairness for the poor of indirect taxes or consumption taxes, which is a very much a relevant topic today, so we will first quote his opinion on that subject in his most synthetic paragraph: There is a very unfair and inhumane proposal, which is much talked about, which is to eliminate all direct taxes and collect all the income necessary for the State with taxes on consumption. It is almost the equivalent of waiving all taxes on the rich, and to request them only of the poor. In many ways, it would be like going back to the feudal system in which the noble paid nothing; but this innovation brings a refinement on the aristocracy, because it would be enough to become rich to be exempt of paying.


Always on the subject of taxes, he again mentions the proletariat and its probable extension, when commenting about a French project to impose a tax on bread. He considers it to be unfair and also irrelevant. He remarks that those few pennies are important for the poor while they mean nothing to the rich, but both eat about the same quantity of bread. Besides, it is not even applicable, He says: Have we calculated that the five-sixths of the inhabitants of France do not buy their bread, but eat their own harvest or from their masters harvest?… There would be left only the people from some big cities and the most miserable among the proletarians, totalling maybe five million people who every day buy their bread from the bakery.


Sismondi addresses the proletarian issue in depth in his Studies on Political Economy. First he tells how the cities bourgeoisie and the cities guilds committed excesses of exclusion in their handling of the economic matters, they wanted justice, freedom, equality for themselves; but did not look at the rest of the nation …. They closed as much as they could access to their society, rejected the rural people who wanted to become citizens, they increased the restrictions for apprenticeship and made it difficult to become a Master … and that way they managed to disadvantage the city industries in terms of with respect to the numbers employed, but with greater superiority with regard to the rewards given. The bourgeois were involved in many monopolies in all trades and gained  from their fellow citizens the benefits of these monopolies. That is to say that they kept their market imperfectly provided, they sold things at high price with little consideration for the quality of their goods, because of the security of always being able to sale.


His description of corporations in that ancient period reminds us of the effects of not so ancient monopolistic policies of cartels in some developed and developing countries. He tells us about the disadvantages of that system but adds a question regarding social protection: Such a system, compared  to goods, compared to the creation of wealth, and according to chrematistic principles , was, without doubt, bad; it  put obstacles in the way of creating wealth, improvements and good prices, but concerning the people, have we calculated all the effects of destroying it? 


These excesses of corporate power led to their abolition, which in turn led to over production which created the proletariat. Sismondi explains then that: The abolition of corporations and all their privileges created the first proletarians, the day worker in the cities: anyone could enter any craft …without apprenticeship, without workshop, without a shop, to work with somebody else’s capital, in someone else’s factory, before having accumulated anything, and they believed they had gained in freedom while losing security. At the beginning, the proletarians, were a small number, the exception…but soon they multiplied for reasons we will show, while all the old masters, colleagues and apprentices disappeared almost completely, and today the proletarians alone carry out the majority of the work in the cities.  


Sismondi then explains that, this fundamental and revolutionary change, was aggravated and imposed on society by the universal struggle created by market competition; that the immediate effect of such struggle was the introduction of the proletarian among the human conditions.


He remarks that this revolution was not as sharp in the countryside and farmers improved their life by abolishing feudal rights. Only the farmers in those countries with extensive crops, found that it suited them better to supervise labour rather than to do it themselves … … and to have them done by the agricultural proletarians, which they hired or dismissed according to their needs. The economic revolution that replaced the old peasants with the proletarians only happened in England, but it is beginning to start everywhere. …Their number increases and the number of peasants decreases. He makes a reflection that concerns the cultural influence of agriculture for the national identity and spirit, that is close to the modern concept of the multifunctionality behind the Common Agricultural Policy of the European Union. The peasant is a man that cultivates his land and who cares about his country, who inherits and is entitled to a part of the country; the wage labourer is only concerned with his wages.


The effects of the accumulation of large amounts of capital in the creation of a proletarian class are described quite accurately by Sismondi and its similarity with present day wealth concentration problems is amazing.  We will cite some highlights. The capitalists are on the lookout to find ways to concentrate under the same system each and every industry, to suppress all independent trades and to install factories, to recreate the work of every locksmith, carpenter, furniture manufacturer in a factory… the chrematistic school looks on in admiration at how companies  manufacturing steam boats, stagecoaches , buses, railways, with the help of huge capital replace all the small industries of independent boatmen, coachmen, carters; each who had his own small capital and was his own master; all the work for big business is now done by salaried people, by  proletarians. The same admiration explodes when wealthy merchants opened vast stores in the big cities and offered, thanks to newly invented mass transportation, to supply all consumers at home … They are well on track to remove all gross merchants, all retail merchants, and all provincial small shopkeepers and to replace those independent men by employees, by salaried men, by proletarians. Big international corporations, Internet and e-commerce comes to mind.


Their success was announced as a prodigious industrial conquest and its promotors, as well as the heads of the chrematistic school, congratulated themselves on the rapid growth of public wealth. But a frightening reality has come to upset the spirits, to destroy all those principles that were announced so dogmatically: the emergence of pauperism, its rapid and menacing growth, and the recognition by oracles of the science who felt powerless to find a solution.


Marx has some of his most amusing and caustic pages when he describes this same process, while   quoting again a wide range of authors, like Luther, Goethe, Aikin, Smith, Say, Malthus, Senior, Scrope, Molinari, Ricardo, Stuart Mill Benjamin Thomson, Parry and obviously, Sismondi. The phrase he quotes from Sismondi belongs to a particular and amusing sort of a dialogue concerning a description of the economic development of Manchester.


Marx starts by a reminiscence of the conflict of Goethe’s Faust between the penchant for accumulation and the penchant for enjoyment, and then goes on to gloss Dr. Aikin’s history of Manchester which the  author divided  into four periods.


“.The first one was when manufacturers had to work hard to survive”, says Aikin.

When they enriched themselves by robbing parents whose children were taken as apprentices; parents paid a high price and apprentices were starving. As the average profit was low, in order to accumulate extreme stinginess was necessary… comments a caustic Marx. 


The second period, when they began to have small fortunes, but kept working as hard as before”, says Aikin.

Because the direct exploitation of labor implies work, as any slave driver well knows, says Marx.


The third one, when luxury started and trade was pushed by sending salesmen at each corner of the kingdom… It is probable that there were few or no capitals of £ 2000 to £ 3000 before 1690, however, by that time traders began to build modern brick houses” , says Aikin.

 “Even in the early seventeenth century, a Manchester industrialist who dared to put a pint of wine before his guests was exposed to criticism and accusations of his neighbours“, remarks Marx, who then goes on to give an interesting  description of usual tavern expenses at that time.


The fourth period, the last thirty years of the eighteenth century, is when the expense and luxury have made great progress, supported by expanded trade with vendors in every corner of Europe”, concludes Aikin.

What would the good Dr. Aikin say, if I he could leave his grave and see the Manchester today? Exclaims  Marx.


Accumulate, accumulate! That is Moses and the prophets! “Industry furnishes the material which savings accumulates” says Marx, quoting Adam Smith. Therefore, save, i.e. Reconvert the greatest possible portion of surplus value, or surplus product, into capital! Accumulation for accumulation’s sake, production for production’s sake, by this formula classical economy expressed the historical mission of the bourgeoisie and not for a single instant deceived itself over the birth-throes of wealth. This phrases are among the most lively in Marx’s stile, but there is the ambiguous footnote number 3, that says: Even J. B. Say says “The savings of the rich are made at the expense of the poor”… and then adds “The Roman proletarian lived almost entirely at the expense of society ….It can almost be said that modern society lives at the expense of the proletarian, on what it keeps out of the remuneration of labour ( Sismondi. Études, Vol. I, page 24. )”


Certainly putting together in the same footnote Say and Sismondi, after somehow attributing those exhortations to the English classical liberal economy looks very much as a manufactured effort to include Sismondi among them. A quite out of place assumption, because the profound discrepancies between Ricardo, Say and Sismondi were well known to any well informed economist and Marx was certainly one of them. Those discrepancies are specially sharp in what concerns over-production, a policy which Sismondi considers the cause of the periodic crises of the capitalist system. Besides, having Say state that the rich are made at the expense of the poor, is at least unexpected, and then there is no even mention of the source. Sismondi’s quote, although plausible, could not be verified in his Études at the page mentioned in the footnote or at any page related to the subject of proletarians.


Wealth and population


Sismondi is always interested on the equitable distribution of wealth among the population, as well as on the harmonious growth of the economic means available, in order to prevent the kind of imbalances between income and population that can cause suffering and misery. That led some to deem him a follower of Malthus, a mistake that is found even among scholars of economic thought. That confusion was denied by Sismondi himself in some articles after the publication of his Nouveaux Principes and with ample reason. The text of the first edition of Nouveaux Principes (1819) already contradicts Malthus and the text of the second edition (1827) widens his polite disagreement with him.


Sismondi says: Mr. Malthus, has established the principle that in every country the population was limited to the amount of food that the country could provide. This proposition could only be true if applied to the entire globe, or to a country without the possibility of importing from others any part  of its livelihood; in all other cases it is modified by foreign trade. But also, and this is most important, that proposition is true only in the abstract and does not apply to political economy. The population never reached the possible limits of subsistence and probably never will.


Not all those who want food always have the means or the right to take it from the land; On the contrary, those for whom the law grants the monopoly on the land, have no interest in asking it all the food that it can produce…. Long before the population growth stops because the country can produce no more food, it stops because it is not possible to buy it or there is a lack of willingness to produce it.


The human population, says Mr. Malthus, can double every twenty-five years, and follows a geometric progression; but work to improve land that is already cultivated, can add more products only in limited amounts … This reasoning …we find completely deceptive… Speaking in abstract, the multiplication of plants follows a geometric progression infinitely faster than that of animals, and this one is infinitely faster than that of men. A grain of wheat produces another twenty in its first year, which can produce four hundred the second, eight thousand the third and four hundred and sixty thousand, the fourth. But for the multiplication to proceed like that, resources, that means land, must be available for the wheat; just like with men.


It has often been seen miserable wage workers who do not find work, or not finding enough; they have been seen consumed by want bread and perishing; but it has never been seen in any country, the human species subjected to small portions as in a besieged city …. It has never been seen that food production stagnates because inability to have the land produce new fruits in proportion to the needs.


Sismondi ends his argument stating that there are other factors different from the lack of food, that limit population growth. He then points out that The nobility everywhere has had sufficient means so it should have multiplied itself until its descendants were reduced to the poverty. But it is the opposite that really happens: in every country in earth we see ancient noble families become extinct after a certain number of generations, and the body of nobility constantly recruited by ennobled ones. This argument closes with an amusing application of Malthus formula to the old noble and rich family of Montmorency, whose wealth goes back to around the year 1000 and who have never lacked food… and then today the universe would have only the Montmorencys, because their number in 1880 would be 2,147,475,648. But it is not so, because the main obstacle to unchallenged reproduction is man’s will, which always opposes this multiplication: an obstacle completely independent of the quantity of food.


One reason for the confusion about Sismondi as a follower of Malthus may come from the quote of Malthus by Marx, expanded by Engels in Capital, Part 7, Chapter XXV – The general law of capitalist accumulation. Marx says: Even Malthus recognizes overpopulation as a necessity of modern industry, though, after his narrow way (Marx always so polite), he explains it by the absolute over-growth  of the labouring population, not by becoming relatively supernumerary. Then he quotes Malthus who did actually say:  Prudential habits about marriage, if carried to a considerable extent among the working class of a country that depends on manufacturing and trade, may injure it. After which he explains that the amount of funds to keep work going grows faster than the population..


The Malthus quotation is attributed in a footnote to his Principles of Political Economy, but then in that same footnote there is a remark by Engels, where he adds the following ambiguous comment: In this work, Malthus finally discovers, with the help of Sismondi, the beautiful Trinity of capitalistic production: over-production, over-population, over-consumption. Three very delicate monsters.


A quite unjustified and out of place commentary, because Sismondi is very well known for his fight against over-production, which he sees as the main cause of the cyclical crises of capitalism, because it causes overconsumption, indebtedness and under-consumption, as well as profligate waste because it distances useful value from exchange value. As for over-population, Sismondi over and over recommended that population should be balanced with the possibility of employment, to avoid exploitation and recommended higher wages to increase workers share of consumption. Sismondi clearly says: Equality of benefits will always result in an increase in market size for producers, while inequality will reduce it. …Concentration of wealth among a small number of owners causes the internal market to shrink even further, and industry is forced to find its new markets overseas. Sismondi, all over his works considers that this Ricardian economic model, which becomes depends on exports, is the basic cause of imperialism.


On applied scientific progress


Sismondi was also accused of being against technological progress, to oppose the use of machines and industrial scientific applications. It is a baseless accusation that Sismondi himself proved wrong in several articles, that were included at the end of the second edition of his New Principles of Political Economy, in 1827.


He says: I have been presented in political economy as an enemy of the progress of society, and in favour of barbaric and oppressive institutions. No, I do not at all want what it was, but I want something better than what we have. I cannot judge what we have now but can compare it to the past, but I am far from wanting to restore ancient ruins, when I only use them to show the eternal needs of society.


I pray that attention is made; It is not at all against the machines, it is not against the discoveries, it is not against civilization, that I address my objections; it is against the modern organization of society, an organization that, by depriving the working man of any other property than his arms, does not leave any protection against competition, against a crazy auction directed against him, and of which he will become the victim.


Suppose that all men share equally among themselves the product of the labour in which they have all participated, and then all the industrial discoveries will be, in every possible case, a benefit for all; because, with every advance of industry, they can always choose to have less work and more rest, or longer joys with the same job. Today it is not discoveries that are bad; it is the unfair distribution that man makes of them.


We are, and it has not being said enough, in an entirely new condition of society, of which there is still no experience. We tend to completely remove all kind of property from every kind of work, to break any patronage between labourer and employer, to stop any sort of partnership from the first in the profits to the second.


This social organization is so new that it is barely established, and it exists only in the most industrial countries, the richest, the most advanced into a system that we are just establishing; a system where the work in agriculture, as well as the work in manufacturing, is made by workers who can be dismissed at the end of each week; It is that which we are heading toward; It is against this danger that I am warning and it is not against the discoveries of science


A few fragments of these clarifications are quoted by Marx in Chapter XXXII – historical tendency of capitalism to build accumulation. There is something somewhat disconcerting, because those clarifications were printed at the end of the second volume of the second edition of Nouveaux Principes, printed in 1827, which, as we said before, Marx does not mention in his bibliography. In the footnote Marx attributes the source to a Volume III that never existed.


The context of what Marx describes when he quotes Sismondi this last time, in the first volume of Capital, is touching: The expropriation of the immediate producers was made with a merciless vandalism, and under the stimulus of the passions the most infamous, the most sordid, the pettiest, the most meanly odious. Self-earned private property, that is based, so to speak, on the fusing together of isolated, independent labouring individual, with the conditions of his labour, is supplanted by capitalistic private property which rests on exploitation of the nominally free labour of others, i.e. on wage labour. To quote Sismondi in this case was indeed appropriate, because that description is precisely what Sismondi wrote at the end of his introduction to his Études sur l’Economie Politique, where he reached the conclusion that The crematistic school – meaning Ricardo’s kind of liberalism– supported with its arguments the power of money with the seduction of low prices.  




Sismondi was the first to develop an economic analysis over the causes for the misery and inequality brought by the economic and social theories that accompanied the Industrial Revolution. He believed in improving people’s conditions by making the large majority of the population owners of private property. Such a policy would mean a lot of work to overcome extructural resistance, but it is a plausible solution for stable growth.


Marx made a brilliant amalgam of the ideas of the XIX century, with Sismondi’s as the technical thread for socio- economics, to reach the conclusion that those miseries would unavoidably bring a violent revolution and that a history of economic injustice would resolve itself in a Proletarian Dictatorship. He thought that abolishing private property was the way to increase the wellbeing of the majority of people, which has a rather quimeric sound. Herding people’s pain and frustration towards  metaphysic and implausible solutions is a historically well proven way of maintaining the social Status Quo. David Ricardo would have smiled.


We can not know precisely what Sismondi would have thought of Marx theories, but we can imagine it by what Sismondi wrote arguing against David Ricardo’s brand of liberalism and of abstract theories in general: One should generally beware in political economy of absolute statements as well as of abstractions … and every abstraction is always a deception. Those lines can be equally applied to Marx’s communist theory. Sismondi concludes the argument against abstractions with a deep meaningful phrase that encapsulates his whole economic philosophy: Besides, political economy is not a mathematical science, but a moral science.    


Geneva, August, 2015


(Version updated: 12/01/2016)




John Harrison, Robert Owen and the Owenites in Britain and America, The Quest for the New                           Moral World, Routledge Revivals, 2009.

Karl Marx.: Capital, Encyclopedia Britannica, inc. Chicago. 1991.

Karl Marx & Frederich Engels. Manifesto of the Communist Party, Encyclopedia Britannica, inc.                       Chicago. 1991.

Maximilien Rubel. Marx critique du marxisme, Payot, Paris 2000

Jean Charles Sismondi. Nouveaux Principes de Économie Politique, Vols I-II, Delunay, Paris, 1827

Jean Charles Sismondi. Études sur l’ Économie Politique , Treuttel &Würtz, Paris, 1837.

John Ruskin. Unto this last. Penguin Books, Penguin Classics, 1985.     




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