Readers of the Socialist Standard will be aware that there has recently taken place an editorial combat between that journal and the organ of the Socialist Labour Party, the “Socialist.” In the course of that combat it was shown by this side that the columns of the “Socialist” reflect the political ignorance and unsound organisation of the body whose organ it is supposed to be. Necessarily, that political ignorance must have its root in lack of knowledge of the scientific achievements of those men who raised Socialism to a science—Marx and Engels. In the September and November (1917) issues of the “Socialist” is to be found a case which bears this statement out.
In the September issue a contributor signing himself A. E. Cook, essaying to teach others what he himself does not understand, said: “Supposing the world’s output of gold is doubled, and the labour needed to mine, refine it, etc., remained the same, then the price of gold would tumble to about half, and an ounce of gold could be bought for 40s.”
This absurdity attracted the attention of one Wm. Walker, who, addressing the Editor as “Sir,” and being referred to as “Mr. Walker,” presumably was not a member of the S.LP. The critic pointed out that “Marx tells us that ‘money has no price.’ ” And he very legitimately proved A.E.C.’s statement to be the absurdity it is.
Mr. Walker’s letter, the Editor of the S L.P. organ informs us, was sent on to Mr. Cook, “to enable him to deal with the matter.”
How does Mr. Cook deal with it ? By resorting to a lot of tosh about “the dual function of gold when it appears at one time as a commodity and at another as money.” “My argument,” he goes on, “ is that the value of gold would fall to half as a result of the increased production ; and. all else being equal, the price would also fall to half.”
Would it! Let us see, then, where Mr. Cook lands himself.
“Gold,” Mr. Cook tells us, “functions as money.” That is to say, it functions as the medium of exchange. But why? Simply because, besides having certain qualities which select it from almost all other commodities, it contains that essential element which constitutes value — embodied socially necessary labour.
This value is, in the case of all commodities, measured by quantity ; for instance, double the amount of the same commodity contains double the value. Hence the shilling (the reference is not, of course, to the silver coin of that denomination, but to the portion of gold equal to the twentieth part of a sovereign) contains definite portion of the ounce of gold, and therefore a definite portion of the value of the ounce of gold. That is the crux of the matter. It is not the gold as such that is needed to make money, but the value of which the gold is the measure.
It is quite obvious, then that the shilling must always bear the same definite quantitative relation to the ounce of gold, both in the matter of weight and of value, and if the gold sinks in value the shilling will do so also. Therefore the value of the oz. of gold could never fall to 40s., fall it never so low. The formula must always be : 1 oz. gold =80s., never as Mr. Cook says: 1 oz. gold=40s. ,
We can find a simple illustration in the case of a foot rule, which in the first instance cost 1s. According to Mr. Cook’s method if the value fell by half, the foot rule would only be six inches long. Thus—
A— 1 foot rule = 12 inches.
B—1 foot rule = 6 inches.
The foot rule stands in the place of the oz. of gold; the inches are analogous to the shillings. As the inches are parts of the rule itself, so the shillings are parts of the oz. of gold. The 80s. are no more the price of the gold than the inches are the price of the rule— they are the thing itself, and it is impossible for the thing to be its own price. Just as the changing value of the rule cannot be revealed by its inch marks, but only by comparing it with something outside itself— money so the changing value of the gold is not revealed by its parts, but only by comparing it with the whole world of commodities outside itself. Granted, therefore, that in Mr. Cook’s first case
A—1 oz. gold= 80s.
is correct, his formula in bis second case (i.e., when the value of gold had fallen to half):
B—1 oz. gold= 40s.
is wrong, for it would result in this :
A—1 oz. gold = 80s., or = 2 cwt. blacking
B — l oz. gold=40s., or = 1 cwt. blacking
thus leaving gold in its money form with the same purchasing power as before—which is ridiculous.
Of course, the correct formula is
A —1 oz. gold=80s., or 2 cwt. blacking.
B— 1 oz. gold=80s., or l cwt. blacking.
Mr. Cook’s concluding advice to Mr. Walker to “re-read a little more carefully that chapter from Marx from which he tears his quotation” when “I am confident he will get a a little insight into the dual function of gold and avoid confusing gold as money with gold as a commodity” about reaches the limit of the ludicrous. The above shows who is confused.
Now for another aspect of this matter. It was recently shown in these columns that the pages of the “Socialist” lmd been used for urging the workers to support the capitalist war. In the resultant discussion the “Socialist” said how ready they were to congratulate the subjects of their criticism when they amended their ways, and instanced when the B.S.P. assumed control of their official organ. The impudence of this statement in view of the utter inability of the S.L.P. to conduct their own party organ in accordance with the principles they profess to hold is striking. Those in “control” of the S.L.P. organ follow their violation of the principle of the class struggle by teaching unsound economies, even in the face of correction.
The present writer is now waiting to be told that he is a “logic chopper.”
A. E. Jacomb