ABC of Economics (1933), Part 1

Ezra Pound

2,306 words Part 1 of 5 The aim of this brochure is to express the fundamentals of economics so simply and clearly that even people of different economic schools and factions will be able to understand each other when they discuss them !fter about forty pa"es # shall not $descend%, but # shall certainly "o into, $"o down into% repetitions and restatements in the hope of reachin" this clarity and simplicity Chapter I # shall have no peace until # "et the sub&ect off my chest, and there is no other way of protectin" myself a"ainst char"es of unsystemati'ed, uncorrelated thou"ht, dilettantism, idle eclecticism, etc , than to write a brief formal treatise 1 Dissociations: Or preliminary clearance of the ground. # be" the reader not to see( implications )hen # express a belief # will say so )hen # am tryin" to prove somethin", # will say so !t the start # am attemptin" merely to "et the reader to distin"uish between certain thin"s, for the sa(e of his own mental clarity, before he attempts to solve anythin" # shall use the term property as distinct from the term capital $*apital% for the duration of this treatise implies a sort of claim on others, a sort of ri"ht to ma(e others wor( Property does not

+or example ,y bust by -audier is my property .obody is expected to do anythin" about it ,y bond of the / and 0 railroad is capital 1omebody is supposed to earn at least 60 dollars a year and pay it to me because # own such a bond Therefore2 it would be possible to attac( the $ri"hts% or $privile"es% of capital without attac(in" the ri"hts or privile"es of property 3nce a"ain, please do not imply Please do not thin( # mean one whit more than what # have written )hen # want to mean somethin" further # will say it 4issociation 2 3verproduction did not be"in with the industrial system .ature habitually overproduces *hestnuts "o to waste on the mountain side, and it has never yet caused a world crisis Chapter II 1 1ane en"ineers and wise men tell us that the 5uestion of production is solved The world%s producin" plants can produce everythin" the world needs There is not the faintest reason to doubt this 2 !s mechanical efficiency increases, the above6mentioned production will re5uire pro"ressively less human time and effort 3 1ane economy demands that this effort should be, for various reasons, apportioned to a very considerable number of people This is not absolutely necessary, but it is advisable #t is not necessary, since a few million slaves or temperamentally busy human bein"s could indubitably do the whole wor( for the lot of us They did it for the 7oman 8mpire and nobody ob&ected save an occasional slave 9 3b&ections to slavery are in part ideal and sentimental 3penly avowed slavery has nevertheless "one out of fashion 5 #t is pure do"ma to assert that an adult human bein" should be ready to do a reasonable amount of wor( for his (eep #t is empiric opinion that a man who is constantly tryin" to spon"e on others and who is unwillin" to do anythin" whatever conducive to the "eneral comfort or to the maintenance of civili'ation is a mere s(un( and that he ultimately becomes a blasted bore not only to others but to his own blasted self 6 # assert a simple do"ma2 ,an should have some sense of responsibility to the human con"eries : !s a mater of observation, very few men have any such sense ; .o social order can exist very lon" unless a few, at least a few, men have such a sense

4emocracy implies that the man must ta(e the responsibility for choosin" his rulers and representatives, and for the maintenance of his own $ri"hts% a"ainst the possible and probable encroachments of the "overnment which he has sanctioned to act for him in public matters < These encroachments in so far as they were political= in so far as they were special privile"es handed down from mediaeval chaos and feudal arran"ements have been from time to time more or less put in order >efferson and >ohn !dams observed that in their youn" days very few men had thou"ht about $"overnment% There were very few writers on $"overnment% The study of economics is a later arrival !n economic library in 1;00 could have been pac(ed in a trun( 10 1ome economic problems could perhaps be considered via political analo"y, but a "reater number cannot Probably the only economic problem needin" emer"ency solution in our time is the problem of distribution There are enou"h "oods, there is superabundant capacity to produce "oods in superabundance )hy should anyone starve? That is the crude and rhetorical 5uestion #t is as much our 5uestion as @amlet%s melancholy was the problem of the renaissance dyspeptic !nd the answer is that nobody should The $science% or study of economics is intended to ma(e sure no one does There is 8nou"h @ow are you "oin" to "et it from where it is, or can be, to where it is not and is needed? # spare the reader the old history of barter, etc !pples for rabbits= slips of paper from the owner orderin" his servants to "ive to the bearer two barrels of beer= "enerali'ed to(ens of "old, leather= paper inscribed with a $value% as of 16 ounces of copper= metal by wei"ht= che5ues with fantastic fi"ures= all serve or have served to shift wealth, wheat and beef from one place to another or to move wool cloth from +landers to #taly )ho is to have these To(ens? 3bviously certain men deserve well of humanity or of other limited numbers of men Those who "row wheat, those who ma(e cloth and harness, those who carry these thin"s from where they are in superfluity to where they are needed, by pushcarts and airplanes, etc !.4 !A13 T@318 who (now where thin"s are, or who discover new and easier means of "ettin" them $out%, coal from the earth, ener"y from an explosion of "asoline ,a(ers, transporters, facilitators and those who contribute to their pleasure or comfort or whom it pleases them favour usual se5uence of children, if they have or want children, a"ed parents who have earned their affection !ll of which would seem perfectly simple and idyllic, but then we come to the &am

1ome of these people who wor( or who could and would wor( are left without paper to(ens 1omeone else has "ot all the to(ens= or someone else has done all the wor( $needed% *B7#3B1A0 8.3B-@, despite the lon" howls of those who used to complain about bein" oppressed and overwor(ed, the last thin" human bein"s appear to wish to share is )37C The last thin" the exploiters want to let their employees divide is labour #T #1 .8D87T@8A811 B.48.#!EA8 that if no one were allowed to wor( Fthis year 1<33G more than five F5G hours a day, there would be hardly anyone out of a &ob and no family without paper to(ens potent enou"h to permit them to eat The ob&ections to this solution are very mysterious # have never yet seen a valid one, thou"h # have seen some very complicated $explanations% about increase in costs # would be willin" to set it out as simple do"ma that the shortenin" of the wor(in" day Fday of paid labourG is the first clean cut to be made # admit it is not the whole answer, but it would "o a lon" way to (eep credit distributed amon" a "reat part of the population Fof any country whatsoeverG, and thereby to (eep "oods, necessities, luxuries, comforts, distributed and in circulation #t is not the whole answer= not the whole answer to the present emer"ency nor does it constitute the whole science of economics Chapter III )hen "oods are produced, some reco"nition of that fact must be made, let us say in the certificates of "oods in existence *an we say that perfect money consists in true certificates of "oods extant? 3r must we limit that statement? 4oes perfect money consist in a potent order2 4eliver these "oods? 3r is it a conditional? ! compromise between a certificate of existence and a re5uest or a promise of proportional concession? 3r is it an abracadabra? ! fa(e havin" no strict correspondence with "oods extant? Excursus ! hard6headed 1cotchman has for some years been tellin" us that money FcreditG as we actually find it at present is a more or less irrelevant product= that it acts as a very stron" imperative2 @ave thou the wei"ht of wheat at such and such a place and deliver itH Eut an increasin"ly lar"e proportion of "oods produced never "ets its certificate 1ome fool or some s(un( plays mean, out of stupidity, out of fear, out of craven and crin"in" malice

)e artists have (nown this for a lon" time, and lau"hed )e too( it as our punishment for bein" artists, we expected nothin" else, but now it occurs to the artisan, and there bein" a lot of artisans, cler(s, etc , this devilment has led the world into misery There was room for the artist to dod"e throu"h the crac(s, a few thousand artists could wan"le or ma(e a haul now and then, but the crac(s won%t pass men by the million 1o there has "ot to be some fairness in the issuin" of certificates, or at any rate somethin" has "ot to be $done% to (eep people from, etc Chapter IV *!AA #T ! 43AA!7, or a 5uid or ten shillin"s or anythin" else you li(e #f a 5uid is a certificate of wor( done F"oods producedG and if you produce twice as much as you did yesterday, you have either "ot to have more 5uids 37 you have "ot to a"ree, all of you, that the 5uid that meant one bushel now means two bushels That is to say if you, in any sense, mean to play fair To put it another way, if money is scarce and an ox sells at four pence you can conceivably have economic &ustice at four pence per ox Eut you can not have social &ustice at four pence per ox and ten shillin"s per beefstea( #f ox is four pence, beefstea( must be some small fraction of a farden !t some a"reed ratio the certificate must function +rom 1<19 to %29 bar chocolate remained, as nearly as # can remember, stationary in respect to "old .ations rose and fell, currencies and commodities became dearer or cheaper )e have had fifteen or more prime years for empiric observation .obody remembers the 1;30%s Fei"hteen6thirtiesG, anythin" men learned then in !merica has been lon" since for"otten The civil war wiped it out Chapter V Inflation and Deflation # am all for controlled inflation, if by that you allow me to mean that more certificates must be "ranted when more "oods are produced !ll the inflation wan"les and all the official "overnmental schemes for inflations yet proposed, leave out the 5uestion of control That is to say, the place of control is a dar( room bac( of a ban(, hun" with deep purple curtains .o one must see what happens )hat happened in the Ean( of the B 1 ! before ,r Dan Euren set up an #ndependent "overnment treasury? )hat happened? #nflation for the benefit of the few Chapter VI 8very economist has to start somewhere # start on the proposition that every man who is decent enou"h to be willin" to wor( for his (eep or that of his helpless dependents Fimmature or senescentG ou"ht to have the chance of doin" a reasonable amount of wor( This is hi"hly !merican and anti68n"lish

T@8 +#71T 1T8P is to (eep the wor(in" day short enou"h to prevent any one man doin" two or three men%s paid wor( T@8 18*3.4 1T8P is the provision of honest certificates of wor( done F"oods produced, or transported, discoveries, facilitations, etc G .obody can be left free to fill in che5ues with lar"e fi"ures re"ardless of services rendered 0es, yes, # have a che5ue boo(, but if # "et fanciful the ban( doesn%t pay for my che5ue Eut there be some, alas my brother there be some who can write che5ues for "reat fi"ures and for mysterious reasons )ho, my brother, controlleth the ban(? #n one country the east wind, and in another country, the west wind #n 8n"land a private firm has for so lon" done it so 5uietly that the world has for"otten it !ll that our "reat "randfathers did for the liberation of the !merican treasury before our fathers were yet in the e"", has been allowed to slip into oblivion, and we are so little tau"ht economics Fa dry, dull and damned sub&ectG that there are not ten thousand !mericans who are the least aware that a similar movement, a similar step toward liberty or democracy or individual responsibility and state control of the national finances simply never occurred in 8n"land 1o clever was the Eritish cli5ue, so astute and so prudent that the $issue has never arisen% The !merican in the street (nows that 8n"land has a $curious old institution called royalty% Ffunny old thin" out of the po(er dec(G, but he supposes that the two nations have the same fiscal system Fthat is, if he ever stops to consider itG Chapter VII #t may not be a matter of names ! free private company may administer a nation%s credit as &ustly and with as little "raft as a board nominally of "overnment officials, bribed or $influenced% by cli5ues of friends and ac5uaintances The economist is the man who (nows )@!T the board, official or unofficial 1@3BA4 do for the continued well6bein" of the nation #n other worlds, where and how it should allocate its certificates of wor( done or its orders to do further wor( and to deliver such and such products

ABC of Economics (1933), Part 2

Ezra Pound

1,6:; words Part 2 of 5 Chapter I On Volition #t will be ob&ected that # am tryin" to base a system on will, not on intellect !nd that is one of the main reasons for my writin" this treatise The criminal classes have no intellectual interests #n proportion as people are without intellectual interests they approach the criminal classes, and approach criminal psycholo"y .o economic system is worth a hoot without $"ood will% .o intellectual system of economics will function unless people are prepared to act on their understandin" People indifferent to the definition of liberty as $le droit de faire tout ce 5ui ne nuit pas aux autres% Ithe ri"ht to do anythin" that does not in&ure others 66 8d J will not 43 anythin" about their economic (nowled"e, whatever be the de"ree of that (nowled"e People with no sense of responsibility fall under despotism, and they deserve all the possible casti"ations and afflictions that the worst forms of despotism provide .o economic system can be effective until a reasonable number of people are interested in economics= interested, # should say, in economics as part of the problem2 what does and what does not in&ure others That the answer to this is probably identical with the answer to2 what is the most enli"htened form of e"otism, does not affect the matter .o e"oist has the ener"y to attain the maximum of e"oistic enli"htenment Chapter II ,arx has aroused interest far less than the importance of his thou"ht mi"ht seem to have warranted @e (new, but for"ot or at any rate failed to ma(e clear, the limits of his economics That is to say, ,arxian economics deals with "oods for sale, "oods in the shop The minute # coo( my own dinner or nail four boards to"ether into a chair, # escape from the whole cycle of ,arxian economics

$*an%t move %em with a cold thin" li(e economics%, said ,r -riffith, the inventor of 1inn +ein .ot one man in a thousand can be aroused to an interest in economics until he definitely suffers from the effects of an evil system # (now no sub&ect in which it is harder to arouse any interest whatsoever The cost of thin"s which really interest human bein"s has nothin" whatever to do with their 5uality ! pleasant woman cost no more than an unpleasant one, in fact, she probably costs infinitely less #t costs no more to coo( a dinner well than to coo( it badly 0ou can, # admit, probably pay more for a "ood dinner than for a bad one, but what you "et is due to your (nowled"e and not to the cate"ory of the hotel The arts of commerce are built on personal application of the laws of value F,arxian metaphysics and the $psycholo"y% of !merican business ballyhooG 0ou will "et not further with economics $as a science% until you are ready to mar( out the scope of that science, as you do in the study of chemistry, physics, mathematics -oods in the window are worth more than the "oods in the basement The art of commerce whereby the proprietor of one cafK ac5uires a clientele and his nei"hbour does not The luxury of the poor, the luxuriousness of the poor which has for a"es sanctioned the small shop and the middleman The savin" of steps, # buy my coffee at my front door, not at the lar"e shop 90 yards off The same applies to my tailor F?G, cobbler and butter merchant 3ver a decade a"o, ,a&or 4ou"las admitted that # had made a contribution to the sub&ect when # pointed out that my "randfather had built a railroad probably less from a desire to ma(e money or an illusion that he could ma(e more that way than some other, than from inherent activity, artist%s desire to ,!C8 somethin", the fun of constructin" and the play of outwittin" and overcomin" obstruction Dery well, # am not proceedin" accordin" to !ristotelian lo"ic but accordin" to the ideo"ramic method of first heapin" to"ether the necessary components of thou"ht .one of these $incoherent% or contradictory facts can be omitted ! problem in the resolution of forces can only be solved when all the forces are ta(en count of #f there be any of them whose variants we cannot reduce to an e5uation, that one must remain at least temporarily outside our $science% #f # remember it correctly my $Part 3ne% was concerned mainly with science The science of economics will not "et very far until it "rants the existence of will as a component= i.e. will toward order, will toward $&ustice% or fairness, desire for civili'ation, amenities included The intensity of that will is definitely a component in any solution Chapter III

O !ections (Cf" Part I, Chapter III) The certificate of wor( done must e5ual that wor( EBT when it is certified that too much corn has been "rown the certificates of its "rowth, or orders to deliver it, will be less pri'ed That is to say, the tic(et for some particular substance depreciates in relation to the "eneral tic(et FmoneyG The finance of financiers is lar"ely the &u""lin" of "eneral tic(ets a"ainst specific tic(ets !s, per example, decline of price in the wheat pit !ll of which would seem to have been wor(ed out and to be fairly familiar )hen the certificate is not $money% or common carrier, but a particulari'ed certificate, it is $&ust% in the sense that the order to deliver so many bushels already $paid for% implies so many bushels ! certificate made out in $common carrier% will not automatically stabili'ed currency or produce &ustice, unless some common sense is used in the production of "oods Ffood, etc G @ence the cries for plannin", etc # mean to say all the ob&ections, etc , to my main thesis lead us bac( into familiar phenomena 8ither the individual must use his intelli"ence, or some con"eries of individuals Fstate or whateverG must persuade or foresee or advise or control .ature overproduces 3verproduction does no harm until you over6mar(et FdumpG #n politics the problem of our time is to find the border between public and private affairs #n economics2 to find a means whereby the common6carrier may be in such way (ept in circulation that the individual%s demand, or at any rate his necessary re5uirement, shall not exceed the amount of common6carrier in his poc(et at any moment, or at his proximate disposal ! new school of economists says it should be put into his poc(et Fevery wee(, every mornin", every six months???G !n old type of mentality as(s whether this would maintain the said individual%s sense of responsibility, and answers the 5uestion very emphatically in the ne"ative # fall bac( on a profession of faith The simplest starting-point appears to me to be the individual%s willin"ness to wor( four hours a day between the a"es of twenty and forty There are doubtless, in modern industry, various directive &obs, etc , that need more prolon"ed attention, but very few in which an e5uivalent stint would not serve Ten years at ei"ht hours a day, as proportionate *ountin" money as certificate of wor( done, the simplest means of (eepin" money distributed Fin le"al6tender credit6slipsG sis to (eep wor( distributed # do not say it is the only

conceivable means, but # definitely assert that it is the most available means, the simplest, the one re5uirin" least bureaucracy and supervision and interference !s for over6time Aet it mean over6time Aet the man wor( four hours for pay, and if he still wants to wor( after that, let him wor( as any artist or poet wor(s, let him embellish his home or his "arden, or stretch his le"s in some form of exercise, or croo( his bac( over a pool6table or sit on his rump and smo(e @e would "et a "reat deal more out of life, and, supposin" him to have any rudiments of intelli"ence, he would be infinitely more li(ely to use it and let it "row, and in any case he would $"et a "reat deal more for his money% # (now, not from theory but from practice, that you can live infinitely better with a very little money and a lot of spare time, than with more money and less time Time in not money, but it is almost everythin" else 8ven suppose that the wa"e for a four6hour day should be $cut% to half the wa"e of an ei"ht6 hour day Fwhich is for various simple reasons unnecessaryLvide infra, *hap #DG, but even supposin" it were necessary and were done The man on that wa"e, once he were assured of its continuance, once he had $arran"ed his life% in accordance, and or"ani'ed his other four hours for private activity, could have a damn si"h better life than he now "ets Chapter IV # say $which is for various reasons unnecessary% because the $wa"e% is now measured in currency which is merely a convention, and a bit of paper with 10 on it is no more difficult to provide than a bit of paper with 5 or with 20 There are various credit schemes which could ta(e care of the problem of leavin" the fi"ure 10 on the bit of paper, even thou"h the day%s wor( were cut in half 4ou"las would pass out slips to the middleman # have outlined a scheme for passin" them out via the factory .either scheme is necessary ! few months a"o the -erman "overnment proposed an inflation without, apparently, any control The $need% of such a scheme is possibly due more to the stren"th of habits of mind, to conventionality in the populace%s thou"hts about money, than to anythin" else +reedom from worry, inherent in the reasonable certainty of (eepin" one%s &ob, must be worth at least 25M of !.0 income .3T8 that this reasonable certainty can only exist when the necessity of pro"ressively shortenin" the wor(in" day, pari passu with mechanical invention, is "enerally reco"ni'ed .o arbitrary number of hours set for 1<33 will be valid in 1<;:, let alone 2093 3ver and above which we come upon ,a&or 4ou"las%s e5uations reLsuperstition in costin"

ABC of Economics (1933), Part 3

Ezra Pound

2,115 words Part 3 of 5 Chapter I Costin# # don%t 5uite see how anyone is "oin" to dod"e Ffor everG the ,a&or%s I* @ 4ou"lasNJ e5uations There are various verbal manifestations and various terminolo"ies and various approaches to the problem # have be"un with distribution of wor( ! point at which the 4ou"lasites disli(e to be"in # have "one on to the demand for &ustice in the distribution of credit slips, but that does not invalidate the ,a&or%s contention that under the present system there are never enou"h credit slips to deal with the product= to distribute the product= to purchase the product= to con&u"ate !.0 of the necessary verbs of sane economics or of a decent and a"reeable life The ,a&or has pointed out the superstition in the computation of costs The reader can loo( up the details in a number of contemporary wor(s @e will not find a simpler statement than 4ou"las%s2 0ou pay for the tree every time you buy a bit of the fruit 3bviously the tree has to be maintained, some fraction over and above the worth of the fruit must be added, but the computation of the faction can and should be free from "ross error -ross error here could undoubtedly undo the "ood effects of a short wor(in" day !s a patient may easily die of one disease after you have cured him of another The re5uirements so far on our list are2 F1G $,oney% as certificate of wor( done

F2G $)or( done% to be in a sense $inside a system%, that is to say, it must be $necessary% or at any rate it must be wor( that someone )!.T1 done The product must be what someone lac(s SicL# lac( half a loaf of bread daily or thereabouts # lac( a few suits of clothes per annum, etc F3G There must be some way for everyone to "et enou"h money or common6carrier to satisfy a reasonable number of lac(s The simplest road is via wor(, and # suspect any other This is also the first instinctive outcry #t is empirically observable that the first thin" men as( for is wor(= and only after refusal do they cry out for free food #f this statement indicates a "reat naOve trust in humanity # am willin" to stand the char"e F9G +airness in the issuance of certificates F# thin( the various 4ou"las plans fall mainly under this headin" G Chapter II $i%e is &ot 'one( Time is not money, but is nearly everythin" else That is to say #t is not money, food, raw materials, women or various fundamental necessities which # cannot at the moment remember, includin" possibly health, but it is a very important lever to most of them $.obody, but socialists%, read ,arx, and there is conse5uently little enli"htened discussion of either his history or his $errors% # have never, so far as # can recall, seen a contemporary reco"nition of the plain fact that a man with a lot of spare time can "et a "reat deal more out of life with a very little money, than an overwor(ed man with a "reat deal # mean apart from polyana Aeisure is not "ained by simply bein" out of wor( Aeisure is spare time free from anxiety !ny spare time not absolutely obsessed by worry can be made the means to a $better life% ,arx deals with "oods in the shop window or the shop basement The minute # coo( my own dinner or ma(e the chair that # sit on # escape from the whole cycle of ,arxian economics #n consideration of which fact # remain a >effersonian republican, and # believe the present troubles, or at any rate the present B 1 !merican or 8n"lish troubles, can be treated from a >effersonian an"le 0ou can throw in *onfucius and Dan Euren, but you must distin"uish between 1;20 and 1<30, you must brin" your >efferson up to date T > had already seen that a"riculture would in "reat measure "ive way to manufacturin", etc !ll !merican and republican principles were lost durin" the damnable rei"n of the infamous )oodrow, but even )oodrow did not favor the /D###th amendment Fprohibition, since repealedG 4espite $liberty unions%, etc , it is almost impossible to discover any sense of !merican principles in contemporary !merican writin", apart from editorials in one or two newspapers which naturally are not read by hi"hbrows

3ne commissioner of labor whose name # have for"otten, did definitely advocate a shorter wor(in" day .o one has raised any coherent or even publicly avowable ob&ection .o one has ventured to say that a shorter day would not decrease the number of totally unemployed .o one has claimed that it would lead to the creation of more $bureaus% and more bureaucrats, and more sassy typists to ta(e notes of vacuous commissioners and sit on their obese laps in "overnment offices .aturally there is no very clear outcry for shorter hours from the wor(men themselves The labor party in !merica is not rich in economist 0ou can%t arouse any very fiery passion on the bare plea of less wor( #t spells less pay to most hearers Ey simple extensions of credit Fpaper creditG it would probably be possible to leave the nominal pay exactly where it is, but it re5uires an almost transcendent comprehension of credit to understand this The plain man cannot in any way comprehend that the accelerated movement of money when everybody has a little means "reater comfort than the constipated state of thin"s when a lot of people have none The fiery laborite wants the unemployed paid out of the rich man%s poc(et The rich man%s poc(et happens to be a mere pipe and not an inexhaustible upsprin"in" fountain .aturally all men desire to pass the buc( The immediate effect of distributin" wor(, under the present system, means that wor(in" men would have to divide with wor(in" men #t cannot, therefore, be a very popular cause The benefits of a shorter day would be diffused, everyone would in a few months 78ceive them, but it would ta(e probably lon"er to P87ceive them !nnoyances stri(e more 5uic(ly than comforts Tell any man that he can live better on 90 shillin"s a wee( and an extra two hours per day to himself, than he can on 50 shillin"s without the two hours and see how little he believes you The idea that prices would come down sounds li(e a pipe dream Prices have always ad&usted themselves to the current spendin" powers of the "eneral public, but that a"ain is a "eneral idea Two hours more per day to loaf, to thin(, to (eep fit by exercise of a different set of muscles, as distinct from overwor( and the spectacle of several millions in idleness H # am an expert # have lived nearly all my life, at any rate all my adult life, amon" the unemployed !ll the arts have been unemployed in my time Chapter III )ree $rade

+ree Trade mi"ht be possible between two countries if they had for each other a full and wholly enli"htened "ood will, provided they had first attained an almost perfect ad&ustment of their own internal affairs #t need hardly be said that for the last century or more, the practice of "overnments has been to ne"lect internal economy= to commit every conceivable villainy, devilry, and idiocy and to employ forei"n affairs, con5uests, dumpin"s, exploitations as a means of distractin" attention from conditions at home, or to use the spoils of sava"es as palliatives to domestic sores or in producin" an eyewash of $prosperity% #n the sense that such prosperity is useful as $bait%= as spectacular fortunes= as $the chance% of "ettin" rich Chapter IV 'althus #n practice it has been shown that families who do not overproduce, that is, who be"et no more children than they can support, have been able to maintain decent standards of livin", and that other families do not #t is probably useless to propound theories of perfect "overnment or of perfect economics for human bein"s who are too demnition stupid and too i"norant to ac5uire so rudimentary a perception of cause and effect 3b&ections to this system are raised and are conceivably raisable on the score of national "reatness, etc .evertheless we are told that @olland has maintained decent standards of livin", etc , by not over populatin" herself The system is supposed Ffor wholly arcane reasonsG to wor( for a small nation and not for a lar"e #t would wor( The only ob&ection to it is that curtailment of the philopro"enitive instinct may not be necessary 3r possibly on practical "rounds, that the present state of bi"otry and idiocy prevent the curtailment, and that the inade5uate pro"ress of education is not able to achieve it 0et sparely populated districts are not necessarily the most prosperous The remedy is to be recommended only at close ran"e for the individual family livin" in a bad economic system #t cannot be made the bac(bone of enli"htened economics on the "rand scale 1uch economics, now, bein" little more than a study of how we can B18 our resources, not how we can refrain from employin" them Bntil we have decent economics the sane man will refuse to overbreed !nd pity for the lar"e poor family will continue to be pity for idiotic lac( of prevision #t may be that all, or most, sciences start from sufferin" or from pity= but once a science is started these emotions have no place in that science -ive a people an almost perfect "overnment, and in two "enerations they will let it run to rot from sheer la'iness Fvide the B 1 ! where not one person in ten exercises his ri"hts and not one person in ten thousand has the faintest idea of the aims and ambitions of the country%s "reat founders and lawma(ers Their dun" has covered their heads G #t is nevertheless one%s duty to try to thin( out a sane economics, and to try to enforce it by that most violent of all means, the attemptin" to ma(e people thin(

Proof of this last statement is very obscure # suppose the only warrant for it is the capacity to thin( and the sense of obli"ation thereby conferred Chapter V *elf+,elp The fore"oin" is not mere nihilism, or mere in6vain6ism or mere 5uietism, nor is it so far off the sub&ect as it mi"ht seem= the point is that .3 3.8 in any society has the ri"ht to blame his troubles on any one else Aiberals and liberal thou"ht so6called have been a mess of mush because of this unac(nowled"ed assumption, and a tendency to breed this state of mind The law of nature is that the animal must either adapt itself to environment or overcome that environmentLsoft life and decadence 4ecline of the !merican type, often bewailedH +irst the pioneer, then the boob and the soft6 headH +loodin" of peasant type, without peasant perseverance and peasant patience in face of low returnH !bility to thin(, part of the adaptation to environmentH Aa'iness of whole "enerationsH !ll the bac(6bone of >efferson%s thou"ht and of Dan Euren%s for"ottenH Eenefits of the latter, lost in civil war and post civil war financeH !ll of which is not wholly alien to my sub&ect !ll 5uestions of how measures can be ta(en, how enforced, are 5uestions of politics 8*3.3,#*1 is concerned with determinin" )@!T financial measures, what methods or re"ulations of trade, etc , must be ta(en, or can most advanta"eously be ta(en of decreed by "overnment whatever its nature, or by whatever elected or hapha'ard or private or dictatorial bodies or individuals control trade, credit, money, etc *ertain thin"s are wise, let us say, for the "overnors of the Ean( of 8n"land Fa private corporationG and wise for the B 1 +ederal 7eserve Eoard, appointed by an elected president, and would be e5ually wise or e5ually foolish for a body directly elected by the people 8n"land, as we have remar(ed, "ave herself to a "an" of ban(ers a"es a"o .o one remembers why #t is no concern of a forei"ner The Eritish wished it or at least some Eritish wished it, and now the rest don%t, apparently, mind !ll these thin"s are part of politics 8conomics is concerned with what should be done, not with how you are "oin" to "et a controllin" "roup of men to carry out an idea= but with the idea, with the proper e5uations !s you mi"ht say the Ealdwin Aocomotive )or(s are concerned with ma(in" en"ines that will pull trains, not with which direction they are to run -ood economics are as sound for 7ussia as for the B 1 ! There may even be several economic solutions to any problem -asoline and coal both serve as fuel

ABC of Economics, Part Ezra Pound 9,:;1 words

Part 9 of 5 Chapter I Politics, . &ecessar( Di#ression 1cience or no science an economic system or lac(6of6system is bound to be affected by the political system in which or beside which it exists, and more especially by the preconceptions or pre&udices or predispositions and attitudes implied in the political system The preconception of democracy, let us say at its best, democracy as it existed in the minds of >efferson and Dan Euren, is that the best men, kaloikagathoi, etc , )#AA T!C8 T@8 T73BEA8 to place their ideas and policies before the ma&ority with such clarity and persuasiveness that the ma&ority will accept their "uidance, i e $be ri"ht% The preconception of let us say the !damses, or aristodemocratic parties is that privile"e, a little of it, will breed a sense of responsibility The further Toryism is that the best should be served #n practice it is claimed that the best "et tired or fail to exert themselves to the necessary de"ree #t seems fairly proved that privile"e does .3T breed a sense of responsibility #ndividuals, let us say exceptional individuals in privile"ed classes, maintain the sense of responsibility, but the "eneral ruc(, namely <5M of all privile"ed classes, seem to believe that the main use of privile"es is to be exempt from responsibility, from responsibilities of every possible (ind

This is as true of financial privile"e as of political privile"e The apparent exception seems to occur at the birth of any new privile"ed class, which amounts to sayin" that any new "overnin" class is bound to be composed of exceptional men, or at any rate of men havin" more ener"y and bein" therefore more fit FaptG to "overn than their fellows The dross of the intelli"ent'ia, lac(in" the force to "overn, constantly try to spread the belief that T@80 are the $best%, the agathoi, etc 3bviously no best, no even "ood, "overnin" class can be spineless= this applies even to an administrative class, or people administerin" economics The term $"ood% in either case must include a capacity for action= some sense of relation between action and mere thou"ht or tal( ! lot of rot is tal(ed and written on the assumption of political and economic laws existin" in vacuo # "o on writin" because it appears to me that no thou"htful man can in our time avoid tryin" to arran"e those thin"s in his own mind in an orderly fashion, or shir( comin" to conclusions about them, i e as man livin" perforce amon" other men, affected by their actions, and by his affectin" them To separate ideas that are not identical and to determine their relations !s to the history of the sub&ect, a fi" for that history save in so far as it applies to the present and to the day after to6morrow ! democracy, the ma&ority which $decides% in a democracy functionin" as such, would presumably choose sound economics shortly after it had learned to distin"uish the sound from the unsound 1ub&ects of an autocrat would obey, and continue obeyin" the economic decisions of their ruler or rulers as lon" as the orders were economically sound, and for a considerable period after those orders were unsound Darious durations of patience in intermediate forms of "overnment ! brea(, revolution, chaos, need not imply any new discovery or ambition or new form of soundness= it is, nevertheless, usually en"ineered in the name of some form of &ustice, or some social belief with economic implications The point is that the orders of an omniscient despot and of an intelli"ent democracy would be very much ali(e in so far as they affected the main body of the country%s economics )hether as independent citi'ens, individuals, etc , or as pac( animals, the nutrition of the population would have its importance +or any particular country, the most immediate road thereto has a "ood deal to be said in its favor and that road would start +73, the conditions in which the said country finds itself at the moment The present moment, the moment under consideration Chapter II

*apital is "enerally considered as per6durable, eternal and indestructible This is probably an error -old coin in circulation wears down, whence paper currency, to save attrition Paper has to be renewed The expense is triflin" but mathematically extant >ewels mi"ht seem to be property and not capital They or precious metal can be buried in cellars )hence they wor( as a ma"net 3bserve the force of the wildest and mildest hopes of profit, and consider the imponderabilia that enter into any consideration of credit F$the expectation that the other man will pay%G ! further point is that not only particular masses of credit may rot, but that the credit of !.0 economic system, 5ua system, may rot .ot only may a year%s crop fail, but the tree itself may There have been so6called systems based not on any sound thou"ht or e5uation but on nothin" more than a temporary accident= as say the chance of swappin" "lass beads to the heathen, or the monopoly of a trade route, or the willin"ness of #ndians to swap forty s5uare miles of land for a rifle 1ome of these systems have lasted for a least three hundred years .ile tolls are at the be"innin" of history Cublai understood paper currency The ,antuans in the 5uattrocento considered a cloth pool on the lines of the @oover "overnment%s buyin" of wheat There is probably no inventable scheme or measure that can%t be upholstered with historic bac("round Chapter III In 1933 /here are /e0 1 +or civili'ed countries the problem of production is solved There are doubtless particular products not producible in particular "eo"raphic areas, and particular uncivili'ed areas where industriali'ation, improved methods of production would solve the local troubles, but for the $"reat powers% etc , the problem is not production 2 The shortenin" of the wor(in" day Fsay to five or four hoursG would so aid the "eneral distribution in all civili'ed countries that they could carry on without other chan"es for a considerable period 3 Eut this would not in the lon" run permit them perpetually to dod"e the problem of a fair andPor ade5uate distribution of credit slips *alled the problem of money or of the fiduciary system That is the main 5uestion and the overwhelmin" 5uestion of economic science #t is, # should assert, open to permanent solution 1cientific solution 9 Eut a permanent and scientific solution of it would still leave us with the necessity of practicin" the !7T of economics= that is to say, we should still have to exercise constant vi"ilance with the same ca"iness that the peasant shows in selectin" his next crop There is no way of dispensin" with the perceptive faculties +ive year planners, ten year planners, clever

men, etc , will for ever have to "uess and to try to "uess ri"ht reLwhat is to be produced and how much and when ,a(e fair the distribution of paper slips certifyin" wor( done, (eep the wor( distributed amon" a sufficient proportion of the people, and you still must have constant ca"iness not to find yourself in 3ctober with nothin" but wheat, or nothin" but aluminium fryin" pans !nd toward this end, there is probably no e5uation other than the "reatest watchfulness of the "reatest number of the most competent 3ne man asleep at a switch can very "reatly discommode 5uite a "ood railway #n a world of Creu"ers and ,ellons you mi"ht say the switchboards are enveloped Fon purposeG in dar(ness )hat # am "ettin" at is, that with all the solvable problems solved, clear and in the open, there will still be $opportunity%, there will still be need to use wits Chapter IV Inflation (*cience as possi l( distinct fro% art in econo%ics) #nflation was said to be $understood% in -ermany after the war There are now almost universal cries for inflation F-ermany, B 1 ! , and elsewhereG There are very few demands for control of inflation #nflation is perhaps the ambi"uous or camoufla"in" homonym for a do'en or more manoeuvres 4issociate what we can +or many people it means merely abandonin" the "old standard ,erely havin" certificates for somethin" other than precious metal The ban(s Fthe bo"ymenG inflate and deflate at will, or appear to )e are told that the tariffs on money are too hi"h, and the tellers are answered that the ban( rates on overni"ht money are almost nil 1o that is not the real crux The ban(s possibly use their freedom to inflate and deflate to their own disproportionate advanta"e T)3 sorts of nations exist2 those which control their finances and those which $are financed% There are, # ta(e it, intermediate de"rees, nations that try more or less to control part of their finances, or that exercise a semi6conscious control over their finances, or have an unconscious influence on them The !merican FB 1 G treasury was $freed% about a century a"o #t was somewhat confused by the civil war, etc

3nce a"ain we are not even concerned with @3) a people or nation is to "et control of its economics but with )@!T it ou"ht to do with them if it did "et control !nother form of the 5uestion is2 what price should it insist on "ettin" from the present controllers if it continues to tolerate their control, i e what is the minimum For maximumG of intelli"ence and of intelli"ent measures it should demand of its $owners% or financiers )e have stated at least part of this in the formula !48QB!T8 Fand more or less &ustG distribution of credit slips Fcertificates of wor( done, etc G # have put $!48QB!T8% in capital and $&ust% in lower case because that is the order of their importance There is a very "reat mar"in of error, a very "reat coefficient of in&ustice possible in a 5uite wor(able and 5uite comfortable economic system The ,iller of 4ee and the rest of it 3nce a human bein" is comfortable, even tolerably comfortable without actual sufferin" and free, more or less, from #,,84#!T8 worry, he will not bother Fto an almost incredible de"ree he will refuse to botherG about economics Eut an inade5uate distribution of credit6slips will upset the whole system, any system= it will heap up obstacles before anyone is aware, it will heap them up all over the place and without ascribin" responsibility to anyone in particular, and without offerin" handy solutions Chapter V 1.de2uate3 4ith 5ueries a out *olutions The ,ahometans ran on a share6out system # for"et whether every fanatic "ot an e5ual share #t don%t much matter, it was so lon" a"o, but at any rate they had national dividends, at least as lon" as they continued to con5uest #t is difficult to conceive national dividends in our day and in our countries without a noisome increase in bureaucracy .ational dividends have wor(ed in the past Bndoubtedly most people would li(e to receive ten "uineas a month is crisp bills from the postman or other trusted minion of officialdom #t sounds so easy, so easy that hardly anyone Fincludin" the authorG can believe it #t seems as if the recipients ou"ht at least to "o throu"h the motions, or to hold themselves ready to do somethin" useful in return for the bonan'a, or at least to (eep awa(e and ma(e sure that somethin" was bein" done, that the "reenbac(s or Eradbury%s or whatever, meant and continued to mean somethin" other than "reenbac(s # seem to remember a time when ,a&or 4ou"las wrote boo(s without mention of national dividends

# am now ma(in" simply a catalo" or list of offered $solutions% # am inclined to leave the national dividendists to show @3) they will insure the perennial delivery of needed "oods a"ainst distributed "reenbac(s # am not denyin" the possibility # merely await fuller enli"htenment !s nearly as # can recall 4ou"las%s early expositions, he claimed that in the present system a certain proportion of the credit6slips, or what should be the 5uantity of same, were suc(ed up or absorbed or caused to disappear # am purposely puttin" this the $other way on% to see whether the idea is sufficiently will constructed to stand bein" &o""led about #n the $present industrial system%, wor( is done, "oods produced, and the manufacturers, owners, traders, etc , demand from the public more credit6slips than the wor( is worth, or at any rate more credit6slips than the "overnments and ban(s will permit to be available a"ainst that wor( !nd the effect is cumulative There are constantly more "oods and constantly fewer and fewer valid certificates, which same leads to constipation !nd a"ain, if # remember ri"htly, ,a&or 4ou"las explained how the wan"le was wan"led !ccordin" to him, if # translate correctly, a certain part of the credit6slips received by the entrepreneurs was wormed down a sort of tube, i.e. instead of e5ualin" the cost for the thin" made and "iven for it, it e5ualed that cost plus part of the machinery used in producin" the article Fpart of the plantG !nd nothin" was done a"ainst this amount of credit ta(en in from the public and hidden #t flowed continually down into the "round, down into somebody%s poc(et 7esultLconstantly more and more "oods for saleLconstantly fewer certificates of wor( done 1o that to (eep thin"s even, one would have either to print more slips, or to compute the cost in some other way, i e to distin"uish between real cost and costs accordin" to the traditional boo(6(eepin" !ccordin" to traditional boo(6(eepin" the ,a&or%s re5uirements would have meant that impossible thin"2 sales under cost Eut he fi"ured that they would not be less than the real cost, and that the paradox was all on paper !ll of which re5uires a bit of thin(in" ,anifestly we have seen companies buildin" new plants out of $profits% ,anifestly we have seen crises Chapter VI The fore"oin" is perhaps very confusin" # state in one place the ma(er ou"ht to "et certificate of wor( done, a fair certificate e5uivalent T3 the wor( done

Then # appear Fto some readersG to say that he "ets too much )hen # ou"ht apparently to say that he "ets too little There is no contradiction @e "ets too much, or as(s too much for some of his product, and is unable to "et anythin" for the rest Aet us say he ma(es one million brooms that really cost him 3d each @e asserts Fin accordance to inherited beliefs of his accountantsG that they cost him 5d and must be sold for 6d @e sells 900,000 for 6d , has 600,000 left on his hands, and ultimately "oes bust 4espite the fact that five hundred or seven hundred thousand people could use the brooms That is an $impossible case% 3r rather it is a crude statement, and there are various intermediate conditions 1ay he drops his price to 1d and sells his six hundred thousand spare brooms, and thereby ruins some other manufacturer, etc , etc ,y ima"inary example is merely to show that hi"h price needn%t ensure perpetual success, and needn%t be the best possible commerce The issue of credit For moneyG must be &ust, i e neither too much nor too little !"ainst every hour%s wor( Fhuman or (ilowatt hourG, an hour%s certificate That can be the first step That can be scientific Bltimately it must be scientific Eut it will not "et you out of the necessity of usin" intelli"ence reLwhat and how much you produce )hat? can be answered by $8verythin" useful or desirable% !nd the how much can be answered by $all that is wanted% with allowance over for accidents That may sound very va"ue, but it is nevertheless reducible to mathematical e5uations and can be scientifically treated The e5uations Fal"ebraic e5uationsG will not mean merely any old 5uantity turned out hapha'ard Their answer will "overn the len"th of the wor(in" day Ey which # still mean the number of hours% wor( per day for which a man is paid 3ver and above which, he can paint pictures on his wall, stuff his armchairs, breed fi"htin" coc(s, buy lottery tic(ets, or indul"e in any form of fru"ality or wastefulness that suits his temperament so lon" as he confines his action to his own property Fvide definition in Part #, *hapter #G 1o lon" as his action is confined to his own home and front yard Chapter VII

Di#ression perhaps 6nnecessar( Personally # favor a home for each individual, in the sense that # thin( each individual should have a certain amount of cubic space into which he or she can retire and be exempt from any outside interference what so damn ever +rom that # should build individual ri"hts, and as they move out from that cubicle or inverted trape'oid they should be modified by balancin" and counterpoise of the same6sprun" ri"hts of others, up to the ri"hts of the state or the con"eries Parallels political and economic Chapter VIII Econo%ics There would seem to be the followin" (inds of error or crime in the issuance of credit6slips a"ainst wor( 1 The issuers may refuse to issue any slips, or ade5uate slips a"ainst the wor( 2 They may issue too many 3 They may issue them in such a way that for products produced and distributed in a complicated manner too much of the credit "oes to some, or some (ind of the labour, and not enou"h to some other The terms $labour%, $wor(%, throu"hout this discussion apply to the man with a shovel, the cler(, the transporter, the entrepreneur, etc 8veryone who acts in the transposition of the article from mother earth to the eater Feye of beholder, hand of userG Chapter I7 # (now of no alphabetic or primer simplification of the 5uestions of de6 and in6flation # mean nothin" easier to comprehend than the history of some particular instance, say the story of Dan Euren versus Eiddle in the 1;30s !t the other end of the scale, 4ou"hty%s Arabia Deserta or Aeo%s history of the ei"hth and ninth centuries can illumine the reader reLwhat occurs when there is .3 production The point is that in any system, in any conceivable system, there arise similar problems, whether under 1oviet or +lorentine Ean(er 1 The "oods needed, 2 The transport, 3 The use or consumption The necessity of motion, which means both of "oods and of the $carrier%,

9 ,onetary carrier ! small amount of $money% chan"in" hands rapidly will do the wor( of a lot movin" slowly, etc , etc !s in mechanics some si'es of machine are found fit for some wor(, etc , detailed applications without chan"e of principle +ruits of experience as to detail2 ideas as to main causes This loo(s li(e a mare%s nest or li(e wilful confusionH )hat the ,a&or said fifteen years a"o matters less than "ettin" a valid and clear statement The manufacturer is $paid% in two ways under the present system @e "ets $money% or $is owed% money for what he sells, and he "ets ability to borrow from ban(s, i e his action and potentiality to produce enable him to "et credit as will as payments Fcash and deferredG and the ban(s "et more credit than they "ive @#,, i e he has to hand part of it bac( to them, and for the part he hands bac( he "ets no direct credit, thou"h he may "et the ability to have more Fon similar termsG Perhaps the only value of these statements is a test value # mean that # am merely sayin" 5 and 2 ma(e : in place of the other economists% statements that 2 and 5 ma(e :, to see whether either they or their readers understand their previous statements !fter all, this is a very rudimentary treatise Ey the time the ban(s have "ot more credit than they "ave the manufacturer, the potential consumer hasn%t enou"h credit to purchase the needed "oods )here would he "et it? The ban(s will always "ive him less than he has to "ive them They are not there for their health The boo(6(eepin" cost of the "oods is the cost FrealG of the "oods plus the cost of the money, or the rent of the money # ta(e it that in the perfect economic state the cost of the money is reduced almost to nothin", to somethin" li(e the mere cost of posta"e, and that this cost is borne by the state, i.e. distributed so as to be a burden on no one in particular 3nce that end is attained, the "eneral intelli"ence can apply itself to the problem of what and how much to produce The state conceived as the public convenience ,oney conceived as a public convenience .either as private bonan'a Chapter 7 &o8elties The possibility of novelties in economics is probably somewhat exa""erated @ume by 1:50 is already tal(in" of paper credit and cites someone or other to the effect that the "reat amount of "old coin in !thens seemed to be no use to the !thenians save in facilitatin" arithmetic

Twenty years a"o we were as(ed to thin( that someone was bein" a $modern% with a lar"e $,% economist because he $left out money% 1ome (now and many fail to state or (eep clearly in mind the need of money, which is the need of a common denominator +37 T@8 1!C8 3+ !**3B.T#.-, so as not to send boo(6(eepers cra'y with columns of ten horses, twelve cows, nine locomotives *onsider the chips in a po(er "ame, more convenient than to have each man bettin" his shirt, watch and cuff6lin(s ! -7!D87 +!#AB78 to dissociate2 is in the nature of wealth *rises in the shei( and sheep trade seldom occur # mean that the primitive "ra'er counts his property in sheep and is not continually worried if he cannot sell out his whole herd @alf the modern trouble is the mania or hallucination or ide fixe of ,!7C8T and mar(et value The fundamental difference in wealth is that of animal, ve"etable and mineral (in"doms !ll manufactured articles parta(e of the main property of the latter, namely, they do not increase and multiply The shepherd%s sheep multiply, the crops that are sown multiply, and neither re5uires much wor( # mean the shepherd sits around, with a boy and a do" The dan"ers from bears and wolves and other incidents of primitive shepherd%s life have been diminished #n le"endary countries he may still do odd &obs of (nittin" The sheep supply clothin" F>efferson%s calculation was that one sheep per person "ave sufficient wool G The meat is disa"reeable but nutritive There is no 5uestion of (eepin" the shepherd +BAA0 employed *rops demand wor( Ftoo muchG at special seasons Eut with a minimum of care crops and sheep multiply 0our possessions and mine do not multiply 0our tables, pianos, etc , remain set as a mineral, but you can%t "et more by di""in" up the floor of your cellar @ume already saw that $the increase and consumption Fitalics mineG of all the commodities, which serve to the ornament and pleasure of li(e, are advanta"es to society= because, at the same time they multiply those innocent "ratifications to individuals, they are a (ind of storehouse Fitalics hisG of labour which in the exi"encies of the state, may be turned to the public service% @ume mi"ht have served as a warnin"= for his $exi"encies of state% are mainly war, which fact ou"ht to have made people thin( a bit more deeply # su""est that it didn%t, for the simple reason that they didn%t in the least understand his first proposition .o boo( can do !AA a man%s thin(in" for him The utility of any statement is limited by the willin"ness of the receiver to thin(

The practices of rent and interest arise out of the natural disposition of "rain and animals to multiply The sense of ri"ht and &ustice which has sustained the main practice of rent and interest throu"h the a"es, despite countless instances of particular in&ustice in the application, is inherent in the nature of animals and ve"etable There is no need to postulate any "reater perversion than natural indolence, and that in itself is insufficient as postulate There has always been a supply of slac(ers, members of less civili'ed tribes, or non6possidentes ready and "lad to watch sheep for part of the wool The impulse of the +rench in our day to "et wor( out of the *on"o is wholly traditional and $normal% !s for sellin" children into servitude, etc , the whole problem is no lon"erLbut at many periods of history has been hardly more thanLthe duration of mortmain @ow lon" shall the dead hand rule, and to what extent? The two extremes2 superstitious sacrosanctity of $property% versus >efferson%s $The earth belon"s to the livin"%, which was part do"ma, and part observation of a fact so obvious that it too( a man of "enius to perceive it #t led >efferson to the belief that no nation has the ri"ht to contract debts not payable within the lifetime of the contractor, which he interpreted to mean the lifetime of the ma&ority of the contractors who were of a"e at the date of contract 1o that from a first estimate of thirty6five years, he finally fixed on nineteen years as the limit of validity of such debts Ey the li"ht of his intelli"ence !merican economics improved from the time of the revolution till the confusion of the B 1 civil war .o system of economics can be valid unless it ta(e count of this inherence in ve"etable and animal nature Fwhich inherence includes or extends to $overproductionG The term $over6production% usually means $more of a thin" than will sell% I1J Chapter 7I Dissociate Per%anence fro% Per%anence 4issociate the perdurability of "ranite from the perdurability of "rain or of a species of animals 1ome people seem to demand the same (ind of durability from a "erminatin" or"anism as they do from the lump of roc( !t the other end of the scale they say2 ! ban( mana"er need (now nothin" save the difference between a bill and a mort"a"e 1everal $"reat financiers% and pri'e6receivin" $economists% in our time fail to ma(e this distinction 8conomic habits arise from the nature of thin"s Fanimal, mineral, ve"etableG 8conomic mess, evil theories are due to failure to (eep the different nature of different thin"s clearly distinct in the mind The economic $revolution% or an economic revolution occurred when raw supply ceased to be limited to static mineral matter Fplus animal and ve"etable increasesG

The minute wor( be"an to be in "reat measure $raw supply% the need for a chan"e in economic concepts arose The minute you have practically unlimited stores of wor( at your disposal, by the simple device of lettin" water run down hill throu"h a pipe onto a turbine For any other deviceG, you have "ot to be"in to read&ust your mental derivatives .ot only will sheep "o on be"ettin" each other, without much attention from the shepherd, but li"hts will shine, stoves "ive heat, trains move, etc , while a couple of men watch a dynamo The cattle drover fed his family The turbine can wor( for the "roup 8ven the idea of national dividends Fwhich # disli(eG seems less "oofy from this an"le #t is as idiotic to expect members of a civili'ed twentieth6century community to "o on wor(in" ei"ht hours a day as it would be to expect the shepherd to try to "row wool on his sheep by hand= the farmer to blow with his own breath on each buried seed to warm it= the poulterer to sit on his hens% e""s Chapter 7II People are so little used, or shall we say the readers of boo(s and papers are so little used to usin" their eyes, or so little traveled as never to have seen simple phenomena @as the reader ever seen women at a well curb, or at a public spi"ot or pump? Citchen plumbin", the spi"ot in the home, means half an hour%s idleness For leisureG per day to every female member of the community F*ivili'ed community as compared with the sava"e and with many very far from sava"e communities G This is not a theory of the leisure class #t is a fact of leisure humanity Fi e civili'ed human lifeG &ote 1 !fter the last war @enry +ord as an experiment bro(e up a number of armoured vessels @e made no money profit, he "ot bac( what it cost him, and he was left with a "reat number of en"ines, which, for all # (now, he still has There is no reason to suppose that these en"ines do any harm, any more than the ruins of !i"ues ,ortes or *arcassonne 0es, they occupy space 0ou don%t want %em in Piccadilly *ircus # have also seen a si"n translatable as2 $,ountain to let, capable of enalpin" 30,000 muttons% There is still room to breathe and wal( about the face of the planet

ABC of Economics, Part 9 & Conclusion

Ezra Pound 2,;10 words

Part 5 of 5 Chapter I 'inor .ddenda and Varia # have never met a "ambler with an ounce of intelli"ence, but the pre&udice a"ainst lotteries is in the cate"ory of superstitions, totemism and taboo Aotteries can harm only the imbeciles who buy tic(ets, but these imbeciles appear to be wholly in their own ri"ht !s a means of collectin" money for state purposes no sound reason has ever been adduced a"ainst this sane safety valve The instinct has been romantici'ed, doubtless in special cases it is the only dan"er some men can incur and the only chance of adventure they "et # doubt if it would "reatly survive in a sane commonwealth, but the world has not yet seen such a commonwealth The pre&udice is part of the puritan imbecility, which is at root a disease, be"otten of the worst in nature There is, however, every reason why the imbecile pastime should be isolated, i e confined in its effect to those who voluntarily "amble, and that it should not be allowed to affect the price of foodstuffs and necessities The whinin"s of a )hitney and the yowls of stoc( &obbers are no better than any other form of "an"ster%s sobstuff The purpose of an act is one of its dimensions= is a component of its specific "ravity, and no one ever yet claimed to have sold short, or ri""ed the stoc( mar(et, save in the hope of pic(in" other men%s poc(ets There is nothin" to be said a"ainst any "an" of thieves playin" po(er except that they are playin" with other men%s money )hen members of a stoc( exchan"e play a"ainst each other without affectin" the food and welfare of members of the community who have no chance of profitin" by the play and in any case no voice in the layin" of the bets, the said bro(ers, etc , cannot ma(e much showin" as sportsmen

They have had a fair amount of time to show what they have done for their countries and so far haven%t been able to di" up even a &ournalist liar to write them a tombstone !s a public utility they are not a success #t is perfectly easy to dissociate investment from speculation= it is fairly easy to spin cobwebs over the borders of the dissociation ! stoc( exchan"e confined to the buyin" and sellin" for real investors would doubtless be very very dull, and many of the present practitioners and scoundrels would ta(e to "olf and chic(en6farmin" in preference to such ovine tran5uillity, but we are not out to "uarantee the private amusements of a few hundred or a few thousand barons #t would be much better from the bono publico standpoint if they were to (ill themselves racin" motor6boats, "et their (ic(s playin" the races, and leave the small fry to roulette and the lotteries 8conomics, as a science, has no messianic call to alter the instincts 1hort of an absolute state ownership of all property there will always be plenty of chance for men to $ma(e fortunes% with serious construction in industry The fewer fa(e diamond mines, the more li(ely new inventions and amplifications will be to find support .3T8 The printin" of fine boo(s improved "reatly after the 1<19R1; war Eecause a "reat number of people had no confidence in the value of money # am aware that # am here in a ris(y position, and that an attempt to do"mati'e mi"ht &eopard my credit, nevertheless # should ha'ard a "uess that a definite "ood or "ain occurred because of a definite state of intelli"ence The "ood occurred not because money was unstable, which # don%t thin( anyone can re"ard as a desirable state of thin"s, but because these people were freed from the ide fixe of money as the one and only fixed value # admit they were only half free and mostly bou"ht de luxe editions because they hoped to be able to sell them later at a profit, but at any rate it was the $thin end of the wed"e%= they had at least for ten minutes "ot their eye on to somethin" concrete ! few honest consumers and a few of the better producers reaped a benefit Chapter II Chec: 6p The remar(s fore"oin", even thou"h they are in some cases my own, have no claim to be novelties !ny man readin" or re6readin" a classic will be affected by what he a"rees with, but probably respect the ancient author in proportion as he seems sound or as he seems to have antedated modernity Thus in @ume, $Prices do not so much depend on the absolute 5uantity of commodities and that of money which are in a nation, as on that of the commodities which come or may come to mar(et, and that of the money which circulates% F4 @ume, b 1:11, d 1::6 ssay on !oneyG The error of !merica in the 1;30%s was to bull the land mar(et as if unwor(ed land far from railways could $yield%

The analo"y in the 1<30%s is that the !merican fool has repeated himself, puttin" $industry% in the place of land, i e stoc(s, shares in industrial companies which either were not in shape to produce or had no possible mar(et anywhere within dreamable ran"e of the sellin" price of stoc(s in .ew 0or( @ume%s reasons for wantin" what he calls a prosperous state were manifestly despicable, consistin" mainly in the idea that if a state were prosperous some dis"ustin" louse li(e Aouis /#D would be able to pay the dre"s of the population Fhis own or some one else%sG to "o (ill or rob some one else Eut that is no reason for not observin" @ume%s intelli"ence @e already saw throu"h money, saw throu"h coined money at that 1ome of his propositions are still valid, and possibly unsupercedable 0ou will probably find nothin" more valid inside its own scope than the statement that prosperity depends not on the 5uantity of money in a country but on its constantly increasin" This was before the term inflation was in daily use 4#113*#!T8 #nflation, first used as a dero"ative term and now F1<32G advised as policy $all over the place% 4#113*#!T8 inflation from steady increase The term inflation mi"ht be limited to mean disproportionate and fa(ed au"mentation of the amount of paper currency, and au"mentation havin" no relation to fact, or havin" a fa(ed relation to fact #.*78!18 or proper au"mentation !s certificate of an increasin" productivity, increase of product, increase of means of production there 1@3BA4 be an increase in the printed certificates of value Fcirculatable certificatesG Eut here a"ain one must distin"uish, and here in particular one can learn from history and in particular the !merican history of the 1;30%s !t that time there was a land boom +ools bou"ht land and boosted the sale price re"ardless of the fact that the merchandise FlandG wasn%t producin", wasn%t bein" wor(ed, couldn%t be wor(ed at once or for a considerable time, and there were crises and panics, etc $)orthless% land was &ust as worthless then as worthless machinery and factories are now To need certificates of value the product Fof land or of factoryG must be wanted by someone, and there must be means of "ettin" it to them There are four elements= and it is useless tryin" to function with three2 1 The product 2 The want 3 The means of transport

9 !.4 the certificates of value, preferably le"al tender and $"eneral%, in the sense that they should be "ood for wheat, iron, lumber, dress "oods, or whatever the heart and stomach desire !nd Frepeatin" an earlier propositionG, everybody must be able to "et a certain number of these certificates on what mi"ht be called decent conditions, i e without torture and without excessive worry Preferably on $fair terms%, namely that the conditions for "ettin" them must not be violently different in the cases of !, E and * +or the nth time, # repeat that the strai"htest road to such a desirable condition is via the formula2 a small amount of wor( for everyone, with a certificate of wor( done as the conse5uence The brains of the nation or "roup to be used to discernin" )@!T wor( is most needful, what wor( is less necessary and what is desirable even thou"h not strictly necessary 1uch wor( should be paid #t would not fill up any man%s day The rest of his day he could employ in expressin" his difference of opinion with the ma&ority, and in such $wor(% or activity as he Fas distinct from the brains of the country officially or"ani'edG mi"ht consider proper, necessary or desirable Bltimately your credit board or your ban( scoundrels or whoever is the financial and economic executive would have one main function and would be &ud"ed intelli"ent or imbecile accordin" as this was performed with competence They are there to determine, and so far as possible to (eep steady, the rate of increase in the printed certificates of value !nd their motivation should be the bonum publicum, the commonweal and not the shiftin" and sha(in" the sieve for the benefit of a few hi"hly6placed croo(s, scoundrels and exploiters The most opportune citation is from a 1paniard whose name is not, in my source, printed, debatin" the new constitution, he observed that where the financial influences had been too stron" and uncontrolled, freedom had suffered T@8 E!181 3+ 8*3.3,#*1 are so simple as to render the sub&ect almost wholly uninterestin" The complication of the sub&ect is hardly a complication, it arises ! from the extreme difficulty of foreseein" what will be wanted= E from the rascally nature of certain men, from selfishness of exploiters and those in $favoured positions% who fear to lose an $advanta"e% The best system of "overnment, economically spea(in", is that which best balances the four elements listed above, be it republic, monarchy, or soviet or dictatorship #n future it will probably be a republic save in special cases, but republic or soviet, the "overnment which

best mana"es this balance, which mana"es it with the least bun( and blah and the "reatest honesty, will and should probably prevail $as a system of "overnment% Chapter III Dictatorship as a *i#n of Intelli#ence Popular fancy and Audwi"ian cheap6&ac(ery show the dictator as man of the hour, force of will, favoured of fortune The phrase $intelli"ence% is more interestin" ,ussolini as intelli"ent man is more interestin" than ,ussolini as the Ei" 1tic( The 4uce%s aphorisms and perceptions can be studied apart from his means of "ettin" them into action $)e are tired of a "overnment in which there is no responsible person havin" a hind name, a front name and an address% $Production is done by machines but consumption is still performed by human bein"s% Chapter IV .lso his Perception of the Di%ension 5ualit( #t is somethin", it was indeed a bri"ht day when some ruler perceived that there was a limit to the dimension 5uantity in the nation%s productivity, # mean a limit to 5uantity of production that could be advanta"eous either to a "iven nation or to the world, but that there is no limit to the dimension 5uality There have been attained maxima, vide my criticism of arts and letters for cited examples, but these attained maxima are not ineluctable limits .othin" forbids us to desire a better art than that of the Quattrocento )e may be or may not be damned unli(ely to "et it, but there is no harm in tryin" !t any rate, in the dimension QB!A#T0 there is ample field for all human ener"y, no one need feel cramped at havin" only four hours a day for paid wor( !fter that, the problem of civili'ation is pretty well outside the domain of the economists .either the billionaire nor the whole howlin" populace can bribe, coax or bully the artist into surpassin" his own 5ualifications +ive hundred people can "et any (ind of civili'ation they li(e, up to the capacity of their best inventor and ma(er Eut all they can do for him is to feed, clothe, and "ive him leisure and space to wor( in )inale )ithin twenty6four hours of writin" the above # find that 7 @ * Fin "e# nglish $eekly for >une 16, 1<32G has at last found an expression simple enou"h to be understood by almost anyone, save possibly ,aynard Ceynes or some paid mouthpiece of Eritish Aiberalism $)ould you call it inflation to issue tic(ets for every seat in a hall, despite the fact that the hall had never before been filled, or more than a fourth of the seats sold, because of there not bein" enou"h tic(ets available?

$#nflation would consist in issuin" more tic(ets than there are seats% That is the foundation stone of the .ew F4ou"lasG economics Ceynes may have found it out by now= he was incapable of understandin" it in 1<20, and until he ma(es public ac(nowled"ment of the value of * @ 4ou"las, # shall be compelled either to re"ard him as a saphead or to believe that his writin"s arise from motives lyin" deeper in the hinterland of his consciousness than courtesy can permit me to penetrate $ and they adopt a hundred contrivances, which serve no purpose but to chec( industry, and to rob ourselves and our nei"hbours of the common benefits of art and nature% 4avid @ume2 %he &alance of %rade Conclusions Or a Postscript in the *prin# 1 !n economic system in which it is more profitable to ma(e "uns to blow men to pieces than to "row "rain or ma(e useful machinery, is an outra"e, and its supporters are enemies of the race 2 The immediate problem is distribution 3 .ational dividends are possible 9 The moment you conceive money as certificate of wor( done, taxes are an anomaly, for it would be perfectly simple to issue such certificates of wor( done for the state, without wastin" effort in re6collectin" certificates already in circulation save at a rate proportional to the destruction of "oods The "esellite stamp can be considered either as tax or as cancellation of excess currency This doesn%t mean that the state should buy &ust anythin" it fancies There would be a rush of $"old6di""ers% the moment such a concept be"an to function, but there should also be an aroused sense of proportion in values T3 the state There would be no miserliness in re"ard to sanitation, healthy houses, medical and dental services 8n"land now wastes three million lives in peace time for every million lives spent in the war 5 The popular instinct a"ainst taxation is sound # repeat that national dividends are possible, but # doubt their immediate necessity, and in any case the first step toward them, whether you re"ard it as proved ri"ht or as experiment, could F? shouldG be made by this direct payment in newly conceived money for wor( publicly needed This mi"ht very possibly provide the &ust proportion of increase in circulatin" medium needed to (eep exchan"e healthy $Prosperity comes of exchan"e% Fmeanin" exchan"e of different "oods, re"ardless of the steps, boo(6(eepin", etc , which may interveneG

6 ! lot of rot is tal(ed because of failure to dissociate different meanin"s in the term $"old standard% -old could serve as measure even with the new and newest fancy brands of economics, so lon" as the issuance of money Fneeded for exchan"eG isn%t ham6strun" or exploited by people who happen to have the "old at a "iven moment #t is perfectly easy to increase the volume of money in circulation without debasin" its value : #f any of the author%s opinions are wron" he will be only too "lad to chan"e %em on proof bein" adduced to their contraries, but he will not alter them merely to please "unma(ers% touts or subsidi'ed economists who for twenty or more years have done nothin" save their utmost to wrap up the sub&ect in tissue paper, and to involve it in mystery Their opinions are suspect because of probable motives, and they never meet open statement by open statement but solely by avoidance or by runnin" off at a bias # personally heard one of the chief and most despicable fa(ers describe himself as an $orthodox economist% $3rthodox% and subsidi'ed physicists condemned -alileo Political earin# Eoth in 8n"land and in !merica the new party should be a ,!T87#!A P!7T0 with three parts to its platform2 1 )hen enou"h exists, means should be found to distribute it to the people who need it 2 #t is the business of the nation to see that its own citi'ens "et their share, before worryin" about the rest of the world F#f not, what is the sense of bein" $united% or or"ani'ed as a state? )hat is the meanin" of $citi'en%?G 3 )hen the potential production Fthe possible productionG of anythin" is sufficient to meet everyone%s needs, it is the business of the "overnment to see that both production and distribution are achieved 8 P 'eb. ()* anno +, dell- era 'ascista