silver," is shown by the fitness of the physical properties of these metals for the functions of money.2 Up to this point, however, we are acquainted only with one function of money, namely, to serve as the form of manifestation of the value of commodities, or as the material in which the magnitudes of their values are socially expressed. An adequate form of manifestation of value, a fit embodiment of abstract, undifferentiated, and therefore equal human labour, that material alone can be whose every sample exhibits the same uniform qualities. On the other hand, since the difference between the magnitudes of value is purely quantitative, the money commodity must be susceptible of merely quantitative differences, must therefore be divisible at will, and equally capable of being re-united. Gold and silver possess these properties by nature.

The use-value of the money commodity becomes twofold. In addition to its special use-value as a commodity (gold, for instance, serving to stop teeth, to form the raw material of articles of luxury, &c.), it acquires a formal use-value, originating in its specific social function.

Since all commodities are merely particular equivalents of money, the latter being their universal equivalent, they, with regard to the latter as the universal commodity, play the parts of particular commodities.3

We have seen that the money-form is but the reflex, thrown upon one single commodity, of the value relations between all the rest. That money is a commodity is therefore a new dis

4

naturalmente moneta," (Galiani.

1 Karl Marx, 1. c. p. 212. "I metalli. "Della moneta " in Custodi's Collection: Parte Moderna t. iii.).

2 For further details on this subject see in my work cited above, the chapter on "The precious metals."

"I. danaro é la merce universale (Verri, 1. c., p. 16).

"Silver and gold themselves (which we may call by the general name of bullion), are . . . commodities. . . rising and falling in. value... Bullion, then, may be reckoned to be of higher value where the smaller weight will purchase the greatest quantity of the product or manufacture of the countrey,' &c. ("A Discourse of the General Notions of Money, Trade, and Exchange, as they stand in relations to each other." By a Merchant. Lond., 1695, p. 7.) "Silver and gold, coined or uncoined, though they are used for a measure of all other things, are no less a commodity than wine, oyl, tobacco, cloth, or stuffs." ("A Discourse concerning Trade, and that in particular of the East Indies," &c. London, 1689, p. 2.) "The stock and riches of the kingdom cannot properly be confined to money, nor ought gold and silver to be excluded from being merchandize." ("A

covery only for those who, when they analyse it, start from its fully developed shape. The act of exchange gives to the commodity converted into money, not its value, but its specific value-form. By confounding these two distinct things some writers have been led to hold that the value of gold and silver is imaginary. The fact that money can, in certain functions, be replaced by mere symbols of itself, gave rise to that other mistaken notion, that it is itself a mere symbol. Nevertheless under this error lurked a presentiment that the money-form of an object is not an inseparable part of that object, but is simply the form under which certain social relations manifest themselves. In this sense every commodity is a symbol, since, in so far as it is value, it is only the material envelope of the human labour spent upon it. But if it be declared that the social characters assumed by objects, or the material forms assumed by the social qualities of labour under the régime of a definite mode of production, are mere symbols, it is in the same breath also declared that these characteristics are arbitrary fictions sanctioned by the so-called universal consent of mankind. This Treatise concerning the East India Trade being a most profitable Trade." London, 1680, Reprint 1696, p. 4.)

1"L'oro e l'argento hanno valore come metalli anteriore all' esser moneta." (Galiani, 1.c.). Locke says, "The universal consent of mankind gave to silver, on account of its qualities which made it suitable for money, an imaginary value." Law, on the other hand, "How could different nations give an imaginary value to any single thing . . . or how could this imaginary value have maintained itself?" But the following shows how little he himself understood about the matter: "Silver was exchanged in proportion to the value in use it possessed, consequently in proportion to its real value. By its adoption as money it received an additional value (une valeur additionelle)" (Jean Law: "Considérations sur le numéraire et le commerce" in E. Daire's Edit. of "Economistes Financiers du XVIII. siècle.,” p. 470).

L'Argent en (des denrées) est le signe." (V. de Forbonnais: "Eléments du Commerce, Nouv. Edit. Leyde, 1776," t. II., p. 143.) "Comme signe il est attiré par les denrées." (1.c., p. 155). "L'argent est un signe d'une chose et la représente." (Montesquieu: "Esprit des Lois," Oeuvres, Lond. 1767, t. II., p. 2.) "L'argent n'est pas simple signe, car il est lui-même richesse; il ne représente pas les valeurs, il les équivaut." (Le Trosne, l.c., p. 910.) "The notion of value contemplates the valuable article as a mere symbol; the article counts not for what it is, but for what it is worth." (Hegel, 1.c., p. 100.) Lawyers started long before economists the idea that money is a mere symbol, and that the value of the precious metals is purely imaginary. This they did in the sycophantic service of the crowned heads, supporting the right of the latter to debase the coinage, during the whole of the middle ages, by the traditions of the Roman Empire and the conceptions of money to be found in the Pandects. "Qu'aucun puisse ni doive faire doute," says an apt scholar of theirs, Philip of Valois, in a decree of 1346, que à nous et à notre majesté royale n' appartiennent seulement. le

suited the mode of explanation in favour during the 18th century. Unable to account for the origin of the puzzling forms assumed by social relations between man and man, people sought to denude them of their strange appearance by ascribing to them a conventional origin.

It has already been remarked above that the equivalent form of a commodity does not imply the determination of the magnitude of its value. Therefore, although we may be aware that gold is money, and consequently directly exchangeable for all other commodities, yet that fact by no means tells how much 10 lbs., for instance, of gold is worth. Money, like every other commodity, cannot express the magnitude of its value except relatively in other commodities. This value is determined by the labour-time required for its production, and is expressed by the quantity of any other commodity that costs the same amount of labour-time1 Such quantitative determination of its relative value takes place at the source of its production by means of barter. When it steps into circulation as money, its value is already given. In the last decades of the 17th century it had already been shown that money is a commodity, but this step marks only the infancy of the analysis. The difficulty lies, not in comprehending that money is a commodity, but in discovering how, why and by what means a commodity becomes money.

mestier, le fait, l'état, la provision et toute l'ordonnance des monnaies, de donner tel cours, et pour tel prix comme il nous plait et bon nous semble." It was a maxim of the Roman Law that the value of money was fixed by decree of the emperor. It was expressly forbidden to treat money as a commodity. "Pecunias vero nulli emere fas erit, nam in usu publico constitutas oportet non esse mercem." Some good work on this question has been done by G. F. Pagnini: "Saggio sopra il giusto pregio delle cose, 1751"; Custodi "Parte Moderna," t. II. In the second part of his work Pagnini directs his polemics especially against the lawyers.

1" If a man can bring to London an ounce of Silver out of the Earth in Peru, in the same time that he can produce a bushel of Corn, then the one is the natural price of the other; now, if by reason of new or more easie mines a man can procure two ounces of silver as easily as he formerly did one, the corn wil be as cheap at ten shillings the bushel as it was before at five shillings, cæteris paribus." William Petty: "A Treatise on Taxes and Contributions." Lond., 1662, p. 32.

2 The learned Professor Roscher, after first informing us that "the false definitions of money may be divided into two main groups: those which make it more, and those which make it less, than a commodity," gives us a long and very mixed catalogue of works on the nature of money, from which it appears that he has

We have already seen, from the most elementary expression of value, x commodity A=y commodity B, that the object in which the magnitude of the value of another object is represented, appears to have the equivalent form independently of this relation, as a social property given to it by Nature. We followed up this false appearance to its final establishment, which is complete so soon as the universal equivalent form becomes identified with the bodily form of a particular commodity, and thus crystallised into the money-form. What appears to happen is, not that gold becomes money, in consequence of all other commodities expressing their values in it, but, on the contrary, that all other commodities universally express their values in gold, because it is money. The inter mediate steps of the process vanish in the result and leave no trace behind. Commodities find their own value already completely represented, without any initiative on their part, in another commodity existing in company with them. These objects, gold and silver, just as they come out of the bowels of the earth, are forthwith the direct incarnation of all human labour. Hence the magic of money. In the form of society

now under consideration, the behaviour of men in the social process of production is purely atomic. Hence their relations to each other in production assume a material character independent of their control and conscious individual action. These facts manifest themselves at first by products as a gen eral rule taking the form of commodities. We have seen how the progressive development of a society of commodity-producers stamps one privileged commodity with the character of money. Hence the riddle presented by money is but the riddle

not the remotest idea of the real history of the theory; and then he moralises thus: "For the rest, it is not to be denied that most of the later economists do not bear sufficiently in mind the peculiarities that distinguish money from other commodities" (it is then, after all, either more or less than a commodity!)... "So far, the semi-mercantilist reaction of Ganilh is not altogether without foundation." (Wilhelm Roscher: "Die Grundlagen der Nationaloekonomie," 3rd Edn., 1858, pp. 277-210) More! less! not sufficiently! so far! not altogether! What clearness and precision of ideas and language! And such eclectic professorial twaddle is mod estly baptised by Mr. Roscher, "the anatomico-physiological method" of political economy! One discovery however, he must have credit for, namely, that money is "a pleasant commodity."

presented by commodities; only it now strikes us in its mos. glaring form.

CHAPTER III.

MONEY, OR THE CIRCULATION OF COMMODITIES.

SECTION 1. THE MEASURE OF VALUES.

THROUGHOUT this work, I assume, for the sake of simplicity, gold as the money-commodity.

The first chief function of money is to supply commodities with the material for the expression of their values, or to represent their values as magnitudes of the same denomination, qualitatively equal, and quantitatively comparable. It thus serves as a universal measure of value. And only by virtue of this function does gold, the equivalent commodity par excel lence, become money.

It is not money that renders commodities commensurable. Just the contrary. It is because all commodities, as values, are realised human labour, and therefore commensurable, that their values can be measured by one and the same special commodity, and the latter be converted into the common measure of their values, i.e., into money. Money as a measure of value, is the phenomenal form that must of necessity be assumed by that measure of value which is immanent in commodities, labour-time.1

The expression of the value of a commodity in gold-x 1 The question Why does not money directly represent labour-time, so that a piece of paper may represent, for instance, x hour's labour, is at bottom the same as the question why, given the production of commodities, must products take the form of commodities? This is evident, since their taking the form of commodities implies their differentiation into commodities and money. Or, why cannot private labour-labour for the account of private individuals-be treated as its opposite, immediate social labour? I have elsewhere examined thoroughly the Utopian idea of "labour-money" in a society founded on the production of commodities (1. c., p. 61, seq.). On this point I will only say further, that Owen's "labour," for instance, is no more "money" than a ticket for the theatre. Owen presupposes directly associated labour, a form of production that is entirely inconsistent with the production of commodities. The certificate of labour is merely evidence of the part taken by the individual in the common labour, and of his right to a certain portion of the common produce destined for consumption. But it never enters into Owen's head to presuppose the production of commodities, and at the same time, by juggling with money, to try to evade the necessary conditions of that production.

money,