MARX'S 
NOTEBOOK COMMENTS ON JAMES MILL, 
LMENTS D'CONOMIE POLITIQUE
[From a translation of Mill's book, by J. T. Parisot, Paris, 1823]
by
KARL MARX
Written in the first half of 1844
Full text of conspectus first published in Marx/Engels, Gesamtausgabe,
Erste Abteilung, Band 3, Berlin, 1932.
English translation Clemens Dutt for the Collected Works
Transcribed for the Internet by meia@marx.org

          

Marx kept a wide variety of notebooks throughout his life. He often 
used them to aid in his study of other authors. A common practice 
was to transcribe long sections from a particular book, and then 
comment on those sections at some length. 
 During his time in Paris, Marx kept nine notebooks -- largely 
dedicated to his growing interest in economics. They date from the 
end of 1843 to January 1845. 
 The "Paris Notebooks" deal with books by J. B. Say, Adam Smith, 
David Ricardo, McCulloch, James Mill, Destott de Tracy, Sismondi, 
Jeremy Bentham, Boisguillebert, Lauderdale, Schtz, List, Skarbek 
and Buret. Most of Marx's accompanying commentary on these authors 
is very fragmentary; and, ideas are often restated far more clearly 
in the Economic and Philosophic Manuscripts (1844). 
 The exception to this is the material addressing James Mill's book, 
Elements of Political Economy (London, 1821). Marx used an 1823 
French translation of the English author's tome. The Mill part of 
the Paris Notebooks is quite lengthy -- it starts on page 25 of the 
fourth notebook and continues into the fifth. 
 Following a lengthy selection of Mill excerpts, Marx suddenly 
"veered off" and began developing a larger, tangential thought. 
After writing his thoughts out, Marx returned to more Mill 
transcription. Soon, a second digression followed. Upon its 
completion, Marx finished up his summarizing. (Only the middle three 
parts of this Mill section of the Paris Notebooks are presented 
below -- in other words, most of the opening and all of closing Mill 
transcriptions are omitted). 
 This document is very close in nature to the Economic and 
Philosophic Manuscripts. Some have suggested that the ideas 
contained herein might be a glimpse into the missing bulk of the EPM 
second manuscript. 
  



    "... A medium of exchange... is some one commodity, which, in 
    order to effect an exchange between two other commodities, is 
    first received in exchange for the one, and is then given in 
    exchange for the other." (P. 93) Gold, silver, money. 
     "By value of money, is here to be understood the proportion in 
    which it exchanges for other commodities, or the quantity of it 
    which exchanges for a certain quantity of other things."  
    "This proportion is determined by the total amount of money 
    existing in a given country." (P. 95) 
     "What regulates the quantity of money?" 
     "Money is made under two sets of circumstances: Government 
    either leaves the increase or diminution of it free; or it 
    controls the quantity, making it greater or smaller as it 
    pleases. 
     "When the increase or diminution of money is left free, 
    government opens the mint to the public, making bullion into 
    money for an many as require it. Individuals possessed of 
    bullion will desire to convert it into money only when it is 
    their interest to do so; that is, when their bullion, converted 
    into money, will be more valuable than in its original form. 
    This can only happen when money is peculiarly valuable, and when 
    the same quantity of metal, in the state of coin, will exchange 
    for a greater quantity of other articles than in the state of 
    bullion. As the value of money depends upon the quantity of it, 
    it has a greater value when it is in short supply. It is then 
    that bullion is made into coin. But precisely because of this 
    conversion, the old ratio is restored. Therefore, if the value 
    of money rises above that of the metal of which it is made, the 
    interest of individuals operates immediately, in a state of 
    freedom, to restore the balance by augmenting the quantity of 
    money." (Pp. 99-101) 
     "Whenever the coining of money, therefore, is free, its 
    quantity is regulated by the value of the metal, it being the 
    interest of individuals to increase or diminish the quantity, in 
    proportion as the value of the metal in coins is greater or less 
    than its value in bullion. 
     "But is the quantity of money is determined by the value of the 
    metal, it is still necessary to inquire what it is which 
    determines the value of the metal.... Gold and silver are in 
    reality commodities. They are commodities for the attaining of 
    which labour and capital must be employed. It is cost of 
    production, therefore, which determines the value of these, as 
    of other ordinary productions." (P. 101) 
     
In the compensation of money and value of metal, as in his 
description of the cost of production as the only factor in 
determining value, Mill commits the mistake -- like the school of 
Ricardo in general -- of stating the abstract law without the change 
or continual supersession of this law through which alone it comes 
into being. If it is a constant law that, for example, the cost of 
production in the last instance -- or rather when demand and supply 
are in equilibrium which occurs sporadically, fortuitously -- 
determines the price (value), it is just as much a constant law that 
they are not in equilibrium, and that therefore value and cost of 
production stand in no necessary relationship. Indeed, there is 
always only a momentary equilibrium of demand and supply owing to 
the previous fluctuation of demand and supply, owing to the 
disproportion between cost of production and exchange-value, just as 
this fluctuation and this disproportion likewise again follow the 
momentary state of equilibrium. This real movement, of which that 
law is only an abstract, fortuitous and one-sided factor, is made by 
recent political economy into something accidental and inessential. 
Why? Because in the acute and precise formulas to which they reduce 
political economy, the basic formula, if they wished to express that 
movement abstractly, would have to be: In political economy, law is 
determined by its opposite, absence of law. The true law of 
political economy is chance, from whose movement we, the scientific 
men, isolate certain factors arbitrarily in the form of laws. 
 Mill very well expresses the essence of the matter in the form of a 
concept by characterising money as the medium of exchange. The 
essence of money is not, in the first place, that property is 
alienated in it, but that the mediating activity or movement, the 
human, social act by which man's products mutually complement one 
another, is estranged from man and becomes the attribute of money, a 
material thing outside man. Since man alienates this mediating 
activity itself, he is active here only as a man who has lost 
himself and is dehumanised; the relation itself between things, 
man's operation with them, becomes the operation of an entity 
outside man and above man. Owing to this alien mediator -- instead 
of man himself being the mediator for man -- man regards his will, 
his activity and his relation to other men as a power independent of 
him and them. His slavery, therefore, reaches its peak. It is clear 
that this mediator now becomes a real God, for the mediator is the 
real power over what it mediates to me. Its cult becomes an end in 
itself. Objects separated from this mediator have lost their value. 
Hence the objects only have value insofar as they represent the 
mediator, whereas originally it seemed that the mediator had value 
only insofar as it represented them. This reversal of the original 
relationship is inevitable. This mediator is therefore the lost, 
estranged essence of private property, private property which has 
become alienated, external to itself, just as it is the alienated 
species-activity of man, the externalised mediation between man's 
production and man's production. All the qualities which arise in 
the course of this activity are, therefore, transferred to this 
mediator. Hence man becomes the poorer as man, i.e., separated from 
this mediator, the richer this mediator becomes. 
 Christ represents originally: 1) men before God; 2) God for men; 3) 
men to man. 
 Similarly, money represents originally, in accordance with the idea 
of money: 1) private property for private property; 2) society for 
private property; 3) private property for society. 
 But Christ is alienated God and alienated man. God has value only 
insofar as he represents Christ, and man has value only insofar as 
he represents Christ. It is the same with money. 
 Why must private property develop into the money system? Because 
man as a social being must proceed to exchange  and because exchange 
-- private property being presupposed -- must evolve value. The 
mediating process between men engaged in exchange is not a social or 
human process, not human relationship; it is the abstract 
relationship of private property to private property, and the 
expression of this abstract relationship is value, whose actual 
existence as value constitutes money. Since men engaged in exchange 
do not relate to each other as men, things lose the significance of 
human, personal property. The social relationship of private 
property to private property is already a relationship in which 
private property is estranged from itself. The form of existence for 
itself of this relationship, money, is therefore the alienation of 
private property, the abstraction from its specific, personal 
nature. 
 Hence the opposition of modern political economy to the monetary 
system, the systme montaire [1], cannot achieve any decisive 
victory in spite of all its cleverness. For if the crude economic 
superstition of the people and governments clings to the sensuous, 
tangible, conspicuous money-bag, and therefore believes both in the 
absolute value of the precious metals and possession of them as the 
sole reality of wealth -- and if then the enlightened, worldly-wise 
economist comes forward and proves to them that money is a commodity 
like any other, the value of which, like that of any other 
commodity, depends therefore on the relation of the cost of 
production to demand, competition, and supply, to the quantity or 
competition of the other commodities -- this economist is given the 
correct reply that nevertheless the real value of things is their 
exchange-value and this in the last instance exists in money, as the 
latter does in the precious metals, and that consequently money 
represents the true value of things and for that reason money is the 
most desirable thing. Indeed, in the last instance the economist's 
theory itself amounts to this wisdom, the only difference being that 
he possesses the capacity of abstraction, the capacity to recognise 
the existence of money under all forms of commodities and therefore 
not to believe in the exclusive value of its official metallic mode 
of existence. The metallic existence of money is only the official 
palpable expression of the soul of money, which is present in all 
branches of production and in all activities of bourgeois society. 
 The opposition of modern economists to the monetary system is 
merely that they have conceived the essence of money in its abstract 
universality and are therefore enlightened about the sensuous 
superstition which believes in the exclusive existence of this 
essence in precious metal. They substitute refined superstition for 
crude superstition. Since, however, in essence both have the same 
root, the enlightened form of the superstition cannot succeed in 
supplanting completely the crude sensuous form, because the former 
does not attack the essence of the latter but only the particular 
form of this essence. 
 The personal mode of existence of money as money -- and not only as 
the inner, implicit, hidden social relationship or class 
relationship between commodities -- this mode of existence 
corresponds the more to the essence of money, the more abstract it 
is, the less it has a natural relationship to the other commodities, 
the more it appears as the product and yet as the non-product of 
man, the less primitive its sphere of existence, the more it is 
created by man or, in economic terms, the greater the inverse 
relationship of its value as money to the exchange-value or money 
value of the material in which it exists. Hence paper money and the 
whole number of paper representatives of money (such as bills of 
exchange, mandates, promissory notes, etc.) are the more perfect 
mode of existence of money as money and a necessary factor in the 
progressive development of the money system. In the credit system, 
of which banking is the perfect expression, it appears as if the 
power of the alien, material force were broken, the relationship of 
self-estrangement abolished and man had once more human relations to 
man. The Saint-Simonists, deceived by this appearance, regarded the 
development of money, bills of exchange, paper money, paper 
representatives of money, credit, banking, as a gradual abolition of 
the separation of man from things, of capital from labour, of 
private property from money and of money from man, and of the 
separation of man from man. An organised banking system is therefore 
their ideal. But this abolition of estrangement, this return of man 
to himself and therefore to other men is only an appearance; the 
self-estrangement, the dehumanisation, is all the more infamous and 
extreme because its element is no longer commodity, metal, paper, 
but man's moral existence, man's social existence, the inmost depths 
of his heart, and because under the appearance of man's trust in man 
it is the height of distrust and complete estrangement. What 
constitutes the essence of credit? We leave entirely out of account 
here the content of credit, which is again money. We leave out of 
account, therefore, the content of this trust in accordance with 
which a man recognises another man by advancing him a certain 
quantity of value and -- at best, namely, when he does not demand 
payment for the credit, i.e., he is not a usurer showing his trust 
in his fellow man not being a swindler, but a "good" man. By a 
"good" man, the one who bestows his trust understands, like Shylock, 
a man who is "able to pay". 
 Credit is conceivable in two relationships and under two different 
conditions. The two relationships are: first, a rich man gives 
credit to a poor man whom he considers industrious and decent. This 
kind of credit belongs to the romantic, sentimental part of 
political economy, to its aberrations, excesses, exceptions, not to 
the rule. But even assuming this exception and granting this 
romantic possibility, the life of the poor man and his talents and 
activity serve the rich man as a guarantee of the repayment of the 
money lent. That means, therefore, that all the social virtues of 
the poor man, the content of his vital activity, his existence 
itself, represent for the rich man the reimbursement of his capital 
with the customary interest. Hence the death of the poor man is the 
worst eventuality for the creditor. It is the death of his capital 
together with the interest. One ought to consider how vile it is to 
estimate the value of a man in money, as happens in the credit 
relationship. As a matter of course, the creditor possesses, besides 
moral guarantees, also the guarantee of legal compulsion and still 
other more or less real guarantees for his man. If the man to whom 
credit is given is himself a man of means, credit becomes merely a 
medium facilitating exchange, that is to say, money itself is raised 
to a completely ideal form. Credit is the economic judgment on the 
morality of a man. In credit, the man himself, instead of metal or 
paper, has become the mediator of exchange, not however as a man, 
but as the mode of existence of capital and interest. The medium of 
exchange, therefore, has certainly returned out of its material form 
and been put back in man, but only because the man himself has been 
put outside himself and has himself assumed a material form. Within 
the credit relationship, it is not the case that money is 
transcended in man, but that man himself is turned into money, or 
money is incorporated in him. Human individuality, human morality 
itself, has become both an object of commerce and the material in 
which money exists. Instead of money, or paper, it is my own 
personal existence, my flesh and blood, my social virtue and 
importance, which constitutes the material, corporeal form of the 
spirit of money. Credit no longer resolves the value of money into 
money but into human flesh and the human heart. Such is the extent 
to which all progress and all inconsistencies within a false system 
are extreme retrogression and the extreme consequence of vileness. 
 Within the credit system, its nature, estranged from man, under the 
appearance of an extreme economic appreciation of man, operates in a 
double way: 
 1) The antithesis between capitalist and worker, between big and 
small capitalists, becomes still greater since credit is given only 
to him who already has, and is a new opportunity of accumulation for 
the rich man, or since the poor man finds that the arbitrary 
discretion of the rich man and the latter's judgment over him 
confirm or deny his entire existence and that his existence is 
wholly dependent on this contingency. 
 2) Mutual dissimulation, hypocrisy and sanctimoniousness are 
carried to extreme lengths, so that on the man without credit is 
pronounced not only the simple judgment that he is poor, but in 
addition a pejorative moral judgment that he possesses no trust, no 
recognition, and therefore is a social pariah, a bad man, and in 
addition to his privation, the poor man undergoes this humiliation 
and the humiliating necessity of having to ask the rich man for 
credit. 
 3) Since, owing to this completely nominal existence of money, 
counterfeiting cannot be undertaken by man in any other material 
than his own person, he has to make himself into counterfeit coin, 
obtain credit by stealth, by lying, etc., and this credit 
relationship -- both on the part of the man who trusts and of the 
man who needs trust -- becomes an object of commerce, an object of 
mutual deception and misuse. Here it is also glaringly evident that 
distrust is the basis of economic trust; distrustful calculation 
whether credit ought to be given or not; spying into the secrets of 
the private life, etc., of the one seeking credit; the disclosure of 
temporary straits in order to overthrow a rival by a sudden 
shattering of his credit, etc. The whole system of bankruptcy, 
spurious enterprises, etc.... As regards government loans, the state 
occupies exactly the same place as the man does in the earlier 
example.... In the game with government securities it is seen how 
the state has become the plaything of businessmen, etc. 
 4) The credit system finally has its completion in the banking 
system. The creation of bankers, the political domination of the 
bank, the concentration of wealth in these hands, this economic 
Areopagus of the nation, is the worthy completion of the money 
system. 
 Owing to the fact that in the credit system the moral recognition 
of a man, as also trust in the state, etc., take the form of credit, 
the secret contained in the lie of moral recognition, the immoral 
vileness of this morality, as also the sanctimoniousness and egoism 
of that trust in the state, become evident and show themselves for 
what they really are. 
 Exchange, both of human activity within production itself and of 
human product against one another, is equivalent to species-activity 
and species-spirit, the real, conscious and true mode of existence 
of which is social activity and social enjoyment. Since human nature 
is the true community of men, by manifesting their nature men 
create, produce, the human community, the social entity, which is no 
abstract universal power opposed to the single individual, but is 
the essential nature of each individual, his own activity, his own 
life, his own spirit, his own wealth. Hence this true community does 
not come into being through reflection, it appears owing to the need 
and egoism of individuals, i.e., it is produced directly by their 
life activity itself. It does not depend on man whether this 
community exists or not; but as long as man does not recognise 
himself as man, and therefore has not organised the world in a human 
way, this community appears in the form of estrangement, because its 
subject, man, is a being estranged from himself. Men, not as an 
abstraction, but as real, living, particular individuals, are this 
entity. Hence, as they are, so is this entity itself. To say that 
man is estranged from himself, therefore, is the same thing as 
saying that the society of this estranged man is a caricature of his 
real community, of his true species-life, that his activity 
therefore appears to him as a torment, his own creation as an alien 
power, his wealth as poverty, the essential bond linking him with 
other men as an unessential bond, and separation from his fellow 
men, on the other hand, as his true mode of existence, his life as a 
sacrifice of his life, the realisation of his nature as making his 
life unreal, his production as the production of his nullity, his 
power over an object as the power of the object over him, and he 
himself, the lord of his creation, as the servant of this creation. 
 The community of men, or the manifestation of the nature of men, 
their mutual complementing the result of which is species-life, 
truly human life -- this community is conceived by political economy 
in the form of exchange and trade. Society, says Destutt de Tracy, 
is a series of mutual exchanges. It is precisely this process of 
mutual integration. Society, says Adam Smith, is a commercial 
society. Each of its members is a merchant. 
 It is seen that political economy defines the estranged form of 
social intercourse as the essential and original form corresponding 
to man's nature. 
 Political economy -- like the real process -- starts out from the 
relation of man to man as that of property owner to property owner. 
If man is presupposed as property owner, i.e., therefore as an 
exclusive owner, who proves his personality and both distinguishes 
himself from, and enters into relations with, other men through this 
exclusive ownership -- private property is his personal, 
distinctive, and therefore essential mode of existence -- then the 
loss or surrender of private property is an alienation of man, as it 
is of private property, itself. Here we shall only be concerned with 
the latter definition. If I give up my private property to someone 
else, it ceases to be mine; it becomes something independent of me, 
lying outside my sphere, a thing external to me. Hence I alienate my 
private property. With regard to me, therefore, I turn it into 
alienated private property. But I only turn it into an alienated 
thing in general, I abolish only my personal relation to it, I give 
it back to the elementary powers of nature if I alienate it only 
with regard to myself. It becomes alienated private property only 
if, while ceasing to be my private property, it on that account does 
not cease to be private property as such, that is to say, if it 
enters into the same relation to another man, apart from me, as that 
which it had to myself; in short, if it becomes the private property 
of another man. The case of violence excepted -- what causes me to 
alienate my private property to another man? Political economy 
replies correctly: necessity, need. The other man is also a property 
owner, but he is the owner of another thing, which I lack and cannot 
and will not do without, which seems to me a necessity for the 
completion of my existence and the realisation of my nature. 
 The bond which connects the two property owners with each other is 
the specific kind of object that constitutes the substance of their 
private property. The desire for these two objects, i.e., the need 
for them, shows each of the property owners, and makes him conscious 
of it, that he has yet another essential relation to objects besides 
that of private ownership, that he is not the particular being that 
he considers himself to be, but a total being whose needs stand in 
the relationship of inner ownership to all products, including those 
of another's labour. For the need of a thing is the most evident, 
irrefutable proof that the thing belongs to my essence, that its 
being is for me, that its property is the property, the peculiarity, 
of my essence. Thus both property owners are impelled to give up 
their private property, but to do so in such a way that at the same 
time they confirm private ownership, or to give up the private 
property within that relationship of private ownership. Each 
therefore alienates a part of his private property to the other. 
 The social connection or social relationship between the two 
property owners is therefore that of reciprocity in alienation, 
positing the relationship of alienation on both sides, or alienation 
as the relationship of both property owners, whereas in simple 
private property, alienation occurs only in relation to oneself, 
one-sidedly. 
 Exchange or barter is therefore the social act, the species-act, 
the community, the social intercourse and integration of men within 
private ownership, and therefore the external, alienated 
species-act. It is just for this reason that it appears as barter. 
For this reason, likewise, it is the opposite of the social 
relationship. 
 Through the reciprocal alienation or estrangement of private 
property, private property, itself falls into the category of 
alienated private property. [2] For, in the first place, it has 
ceased to be the product of the labour of its owner, his exclusive, 
distinctive personality. For he has alienated it, it has moved away 
from the owner whose product it was and has acquired a personal 
significance for someone whose product it is not. It has lost its 
personal significance for the owner. Secondly, it has been brought 
into relation with another private property, and placed on a par 
with the latter. Its place has been taken by a private property of a 
different kind, just as it itself takes the place of a private 
property of a different kind. On both sides, therefore, private 
property appears as the representative of a different kind of 
private property, as the equivalent of a different natural product, 
and both sides are related to each other in such a way that each 
represents the mode of existence of the other, and both relate to 
each other as substitutes for themselves and the other. Hence the 
mode of existence of private property as such has become that of a 
substitute, of an equivalent. Instead of its immediate unity with 
itself, it exists now only as a relation to something else. Its mode 
of existence as an equivalent is no longer its specific mode of 
existence. It has thus become a value, and immediately an 
exchange-value. Its mode of existence as value is an alienated 
designation of itself, different from its immediate existence, 
external to its specific nature, a merely relative mode of existence 
of this. 
 How this value is more precisely determined must be described 
elsewhere, as also how it becomes price. 
 The relationship of exchange being presupposed, labour becomes 
directly labour to earn a living. This relationship of alienated 
labour reaches its highest point only when 1) on one side labour to 
earn a living and the product of the worker have no direct relation 
to his need or his function as worker, but both aspects are 
determined by social combinations alien to the worker; 2) he who 
bugs the product is not himself a producer, but gives in exchange 
what someone else has produced. In the crude form of alienated 
private property, barter, each of the property owners has produced 
what his immediate need, his talents and the available raw material 
have impelled him to make. Each, therefore, exchanges with the other 
only the surplus of his production. It is true that labour was his 
immediate source of subsistence, but it was at the same time also 
the manifestation of his individual existence. Through exchange his 
labour has become partly a source of income. Its purpose differs now 
from its mode of existence. The product is produced as value, as 
exchange-value, as an equivalent, and no longer because of its 
direct, personal relation to the producer. The more diverse 
production becomes, and therefore the more diverse the needs become, 
on the one hand, and the more one-sided the activities of the 
producer become, on the other hand, the more does his labour fall 
into the category of labour to earn a living, until finally it has 
only this significance and it becomes quite accidental and 
inessential whether the relation of the producer to his product is 
that of immediate enjoyment and personal need, and also whether his 
activity, the act of labour itself, is for him the enjoyment of his 
personality and the realisation of his natural abilities and 
spiritual aims. 
 Labour to earn a living involves: 1) estrangement and fortuitous 
connection between labour and the subject who labours; 2) 
estrangement and fortuitous connection between labour and the object 
of labour; 3) that the worker's role is determined by social needs 
which, however, are alien to him and a compulsion to which he 
submits out of egoistic need and necessity, and which have for him 
only the significance of a means of satisfying his dire need, just 
as for them he exists only as a slave of their needs; 4) that to the 
worker the maintenance of his individual existence appears to be the 
purpose of his activity and what he actually does is regarded by him 
only as a means; that he carries on his life's activity in order to 
earn means of subsistence. 
 Hence the greater and the more developed the social power appears 
to be within the private property relationship, the more egoistic, 
asocial and estranged from his own nature does man become. 
 Just as the mutual exchange of the products of human activity 
appears as barter, as trade, so the mutual completion and exchange 
of the activity itself appears as division of labour, which turns 
man as far as possible into an abstract being, a machine tool, etc., 
and transforms him into a spiritual and physical monster. 
 It is precisely the unity of human labour that is regarded merely 
as division of labour, because social nature only comes into 
existence as its opposite, in the form of estrangement. Division of 
labour increases with civilisation. 
 Within the presupposition of division of labour, the product, the 
material of private property, acquires for the individual more and 
more the significance of an equivalent, and as he no longer 
exchanges only his surplus, and the object of his production can be 
simply a matter of indifference to him, so too he no longer 
exchanges his product for something directly needed by him. The 
equivalent comes into existence as an equivalent in money, which is 
now the immediate result of labour to gain a living and the medium 
of exchange (see above). 
 The complete domination of the estranged thing over man has become 
evident in money, which is completely indifferent both to the nature 
of the material, i.e., to the specific nature of the private 
property, and to the personality of the property owner. What was the 
domination of person over person is now the general domination of 
the thing over the person, of the product over the producer. Just as 
the concept of the equivalent, the value, already implied the 
alienation of private property, so money is the sensuous, even 
objective existence of this alienation. 
 Needless to say that political economy is only able to grasp this 
whole development as a fact, as the outcome of fortuitous necessity. 

 The separation of work from itself -- separation of the worker from 
the capitalist -- separation of labour and capital, the original 
form of which is made up of landed property and movable property.... 
The original determining feature of private property is monopoly; 
hence when it creates a political constitution, it is that of 
monopoly. The perfect monopoly is competition. 
 To the economist, production, consumption and, as the mediator of 
both, exchange or distribution, are separate [activities]. [3] The 
separation of production and consumption, of action and spirit, in 
different individuals and in the same individual, is the separation 
of labour from its object and from itself as something spiritual. 
Distribution is the power of private property manifesting itself. 
 The separation of labour, capital and landed property from one 
another, like that of labour from labour, of capital from capital, 
and landed property from landed property, and finally the separation 
of labour from wages, of capital from profit, and profit from 
interest, and, last of all, of landed property from land rent, 
demonstrate self-estrangement both in the form of self-estrangement 
and in that of mutual estrangement. 
  
    "We have next to examine the effects which take place by the 
    attempts of government to control the increase or diminution of 
    money [....] When it endeavours to keep the quantity of money 
    less than it would be, if things were left in freedom, it raises 
    the value of the metal in the coin, and renders it the interest 
    of every body, [who can,] to convert his bullion into money." 
    People "have recourse to private coining. This the government 
    must [...] prevent by punishment. On the other hand, were it the 
    object of government to keep the quantity of money greater than 
    it would be, if left in freedom, it would reduce the value of 
    the metal in money, below its value in bullion, and make it the 
    interest of every body to melt the coins. This, also, the 
    government would have only one expedient for preventing, namely, 
    punishment. But the prospect of punishment will prevail over the 
    prospect of profit [, only if the profit is small]." Pp. 101, 
    102 (pp. 137, 138). 
     Section IX. "If there were two individuals one of whom owed to 
    the other 100, and the other owed to him 100", instead of 
    paying each other this sum "all they had to do was to exchange 
    their mutual obligations. The case" is the same between two 
    nations.... Hence bills of exchange. "The use of them was 
    recommended by a still stronger necessity [...1, because the 
    coarse polity of those times prohibited the exportation of the 
    precious metals, and punished with the greatest severity any 
    infringement...." Pp. 104-05, 106 (p. 142 et seq.). 
     Section X. Saving of unproductive consumption by paper money. 
    P. 108 et seq. (p. 146 et seq.). 
     Section XI. "The inconveniencies" of paper money are ... 
    "First, -- The failure of the parties, by whom the notes are 
    issued, to fulfil their engagements. Second, -- Forgery. Third, 
    -- The alteration of the value of the currency". P. 110 (p. 
    149). 
     Section XII. "... the precious metals, are [...] that commodity 
    [which is the most generally bought and sold...]. Those 
    commodities alone can be exported, which are cheaper in the 
    country from which they go, than in the country to which they 
    are sent; and that those commodities alone can be imported, 
    which are dearer in the country to which they come, than in the 
    country from which they are sent". Accordingly it depends on the 
    value of the precious metals in a country whether they are 
    imported or exported. Pp. 128, 129 [p. 175 et seq.]. 
     Section XIII. "When we speak of the value of the precious 
    metal, we mean the quantity of other things for which it will 
    exchange." This relation is different in different countries and 
    even in different parts of the country. "We say that living is 
    more cheap; in other words, commodities may be purchased with a 
    smaller quantity of money." P. 131 [p. 177]. 
     Section XVI. The relation between nations is like that between 
    merchants.... "The merchants [...] will always buy in the 
    cheapest market, and sell in the dearest." P. 159 (p. 215). 
     IV. Consumption. 
     "Production, Distribution, Exchange [...] are means. No man 
    produces for the sale of producing [....] distribution and 
    exchange are only the intermediate operations [for bringing the 
    things which have been produced into the hands of those who are] 
    to consume them." P. 177 (p. 237), 
     Section I. "Of Consumption, there are two species." 1) 
    Productive. It includes everything "expended for the sake of 
    something to be produced" and comprise' "the necessaries of the 
    labourer...." The second class then [...] "machinery; including 
    tools [...], the buildings necessary for the productive 
    operations, and even the cattle. The third is, the material of 
    which the commodity to be produced must be formed, or from which 
    it must be derived". Pp. 178, 179 (pp. 238, 239). "[Of these 
    three classes of things,] it is only the second, the consumption 
    of which is not completed in the course of the productive 
    operations." P. 179 (loc. cit.). 
     2) Unproductive consumption. "The wages" given to a "footman" 
    and "all consumption, which does not take place to the end that 
    something, which may be an equivalent for it, may be produced by 
    means of it, is unproductive consumption". Pp. 179, 180 (p. 
    240). "Productive consumption is itself a means; it is a mean to 
    production. Unproductive consumption [...] is not a means." It 
    "is the end. This or the enjoyment which is involved in it, is 
    the good which constituted the motive to all the operations by 
    which it was preceded". P. 180 (p. 241). "By productive 
    consumption, nothing is lost [....] Whatever is unproductively 
    consumed, is lost." P. 180 (loc. cit.). "That which is 
    productively consumed is always capital. This is a property of 
    productive consumption which deserves to be particularly 
    remarked [....] Whatever is consumed productively" is capital 
    and "become capital." P. 181 (p. [241,] 242). "The whole of what 
    the productive powers of the country have brought into existence 
    in the course of a year, is called the gross annual produce. Of 
    this the greater part is required to replace the capital which 
    has been consumed [....] What remains of the gross produce, 
    after replacing the capital which has been consumed, is called 
    the net produce; and is always distributed either as profits of 
    stock, or as rent." Pp. 181, 182 (pp. 242, 243). "This net 
    produce is the fund from which all addition to the national 
    capital is commonly made." (loc. cit.) "... the two species of 
    consumption" are matched by "the two species of labour, 
    productive and unproductive...." P. 182 (p. 244). 
     Section II. "... the whole of what is annually produced, is 
    annually consumed; or [...] what is produced in one year, is 
    consumed in the next." Either productively or unproductively. P. 
    184 (p. 246). 
     Section III. "Consumption is co-extensive with production." "A 
    man produces, only because he wishes to have. If the commodity 
    which he produces is the commodity which he wishes to have, he 
    stops when he has produced as much as he wishes to have [....] 
    When a man produces a greater quantity [...] than he desires for 
    himself, it "n only be on one account; namely, that he desires 
    some other commodity, which he can obtain in exchange for the 
    surplus of what he himself has produced.... If a man desires one 
    thing, and produces another, it can only be because the thing 
    which he desires can be obtained by means of the thing which he 
    produces, and better obtained than if he had endeavoured to 
    produce it himself. After labour has been divided [...] each 
    producer confines himself to some one commodity or part of a 
    commodity, a small portion only of what he produces is used for 
    his own consumption. The remainder he destines for the purpose 
    of supplying him with all the other commodities which he 
    desires; and when each man confines himself to one commodity, 
    and exchanges what he produces for what is produced by other 
    people, it is found that each obtains more of the several things 
    which he desires, than he would have obtained had he endeavoured 
    to produce them all for himself."  
    "In the case of the man who produces for himself, there is no 
    exchange. He neither offers to buy any thing, nor to sell any 
    thing. He has the property; he has produced it; and does not 
    mean to part with it. If we apply, by a sort of metaphor, the 
    terms demand and supply to this case, it is implied [...] that 
    the demand and supply are exactly proportioned to one another. 
    As far then as regards the demand and supply of the market, we 
    may leave that portion of the annual produce, which each of the 
    owners consumes in the shape in which he produces or receives 
    it, altogether out of the question." Pp. 186, 187 
     "In speaking here of demand and supply, it is evident that we 
    speak of aggregates. When we say of any particular nation, at 
    any particular time, that its supply is equal to its demand, we 
    do not mean in any one commodity, or any two commodities. We 
    mean, that the amount of its demand in all commodities taken 
    together, is equal to the amount of its supply in all 
    commodities taken together. It may very well happen, 
    notwithstanding this equality in the general sum of demands and 
    supplies, that some one commodity or commodities may have been 
    produced in a quantity either above or below the demand for 
    those particular commodities." P. 188 (pp. 251, 252). "Two 
    things are necessary to constitute a demand. These are -- A Wish 
    for the commodity, and An Equivalent to give for it. A demand 
    means, the will to purchase, and the means of purchasing. If 
    either is wanting, the purchase does not take place. An 
    equivalent is the necessary foundation of all demand. It is in 
    vain that a man wishes for commodities, if he has nothing to 
    give for them. The equivalent which a man brings is the 
    instrument of demand. The extent of his demand is measured by 
    the extent of his equivalent. The demand and the equivalent are 
    convertible terms, and the one may be substituted for the other. 
    [...] We have already seen, that every man, who produces, has a 
    wish for other commodities, than those which he has produced, to 
    the extent of all that he has produced beyond what he wishes to 
    keep for his own consumption. And it is evident, that whatever a 
    man has produced and does not wish to keep for his own 
    consumption, is a stock which he may give in exchange for other 
    commodities. His will, therefore, to purchase, and his means of 
    purchasing -- in other words, his demand, is exactly equal to 
    the amount of what he has produced and does not mean to 
    consume." Pp. 188-89 (pp. 252, 253). 
     
With his customary cynical acumen and clarity, Mill here analyses 
exchange on the basis of private property. 
 Man produces only in order to have -- this is the basic 
presupposition of private property. The aim of production is having. 
And not only does production have this kind of useful aim; it has 
also a selfish aim; man produces only in order to possess for 
himself; the object he produces is the objectification of his 
immediate, selfish need. For man himself -- in a savage, barbaric 
condition -- therefore, the amount of his production is determined 
by the extent of his immediate need, the content of which is 
directly the object produced. 
 Under these conditions, therefore, man produces no more than he 
immediately requires. The limit of his need forms the limit of his 
production. Thus demand and supply exactly coincide. The extent of 
his production is measured by his need. In this case no exchange 
takes place, or exchange is reduced to the exchange of his labour 
for the product of his labour, and this exchange is the latent form, 
the germ, of real exchange. 
 As soon as exchange takes place, a surplus is produced beyond the 
immediate limit of possession. But this surplus production does not 
mean rising above selfish need. On the contrary, it is only an 
indirect way of satisfying a need which finds its objectification 
not in this production but in the production of someone else. 
Production has become a means of gaining a living, labour to gain a 
living. Whereas under the first state of affairs, therefore, need is 
the measure of production, under the second state of affairs 
production, or rather ownership of the product, is the measure of 
how far needs can be satisfied. 
 I have produced for myself and not for you, just as you have 
produced for yourself and not for me. In itself, the result of my 
production has as little connection with you as the result of your 
production has directly with me. That is to say, our production is 
not man's production for man as a man, i.e., it is not social 
production. Neither of us, therefore, as a man stands in a relation 
of enjoyment to the other's product. As men, we do not exist as far 
as our respective products are concerned. Hence our exchange, too, 
cannot be the mediating process by which it is confirmed that my 
product is [for] you, because it is an objectification of your own 
nature, your need. For it is not man's nature that forms the link 
between the products we make for one another. Exchange can only set 
in motion, only confirm, the character of the relation which each of 
us has in regard to his own product, and therefore to the product of 
the other. Each of us sees in his product only the objectification 
of his own selfish need, and therefore in the product of the other 
the objectification of a different selfish need, independent of him 
and alien to him. 
 As a man you have, of course, a human relation to my product: you 
have need of my product. Hence it exists for you as an object of 
your desire and your will. But your need, your desire, your will, 
are powerless as regards my product. That means, therefore, that 
your human nature, which accordingly is bound to stand in intimate 
relation to my human production, is not your power over this 
production, your possession of it, for it is not the specific 
character, not the power, of man's nature that is recognised in my 
production. They [your need, your desire, etc.] constitute rather 
the tie which makes you dependent on me, because they put you in a 
position of dependence on my product. Far from being the means which 
would give you power over my production, they are instead the means 
for giving me power over you. 
 When I produce more of an object than I myself can directly use, my 
surplus production is cunningly calculated for your need. It is only 
in appearance that I produce a surplus of this object. In reality I 
produce a different object, the object of your production, which I 
intend to exchange against this surplus, an exchange which in my 
mind I have already completed. The social relation in which I stand 
to you, my labour for your need, is therefore also a mere semblance, 
and our complementing each other is likewise a mere semblance, the 
basis of which is mutual plundering. The intention of plundering, of 
deception, is necessarily present in the background, for since our 
exchange is a selfish one, on your side as on mine, and since the 
selfishness of each seeks to get the better of that of the other, we 
necessarily seek to deceive each other. It is true though, that the 
power which I attribute to my object over yours requires your 
recognition in order to become a real power. Our mutual recognition 
of the respective powers of our objects, however, is a struggle, and 
in a struggle the victor is the one who has more energy, force, 
insight, or adroitness. If I have sufficient physical force, I 
plunder you directly. If physical force cannot be used, we try to 
impose on each other by bluff, and the more adroit overreaches the 
other. For the totality of the relationship, it is a matter of 
chance who overreaches whom. The ideal, intended overreaching takes 
place on both sides, i.e., each in his own judgment has overreached 
the other. 
 On both sides, therefore, exchange is necessarily mediated by the 
object which each side produces and possesses. The ideal 
relationship to the respective objects of our production is, of 
course, our mutual need. But the real, true relationship, which 
actually occurs and takes effect, is only the mutually exclusive 
possession of our respective products. What gives your need of my 
article its value, worth and effect for me is solely your object, 
the equivalent of my object. Our respective products, therefore, are 
the means, the mediator, the instrument, the acknowledged power of 
our mutual needs. Your demand and the equivalent of your possession, 
therefore, are for me terms that are equal in significance and 
validity, and your demand only acquires a meaning, owing to having 
an effect, when it has meaning and effect in relation to me As a 
mere human being without this instrument your demand is an 
unsatisfied aspiration on your part and an idea that does not exist 
for me. As a human being, therefore, you stand in no relationship to 
my object, because I myself have no human relationship to it. But 
the means is the true power over an object and therefore we mutually 
regard our products as the power of each of us over the other and 
over himself. That is to say, our own product has risen up against 
us; it seemed to be our property, but in fact we are its property. 
We ourselves are excluded from true property because our property 
excludes other men. 
 The only intelligible language in which we converse with one 
another consists of our objects in their relation to each other. We 
would not understand a human language and it would remain without 
effect. By one side it would be recognised and felt as being a 
request, an entreaty, and therefore a humiliation, and consequently 
uttered with a feeling of shame, of degradation. By the other side 
it would be regarded as impudence or lunacy and rejected as such. We 
are to such an extent estranged from man's essential nature that the 
direct language of this essential nature seems to us a violation of 
human dignity, whereas the estranged language of material values 
seems to be the well-justified assertion of human dignity that is 
self-confident and conscious of itself. 
 Although in your eyes your product is an instrument, a means, for 
taking possession of my product and thus for satisfying your need; 
yet in my eyes it is the purpose of our exchange. For me, you are 
rather the means and instrument for producing this object that is my 
aim, just as conversely you stand in the same relationship to my 
object. But 1) each of us actually behaves in the way he is regarded 
by the other. You have actually made yourself the means, the 
instrument, the producer of your own object in order to gain 
possession of mine; 2) your own object is for you only the 
sensuously perceptible covering, the hidden shape, of my object; for 
its production signifies and seeks to express the acquisition of my 
object. In fact, therefore, you have become for yourself a means, an 
instrument of your object, of which your desire is the servant, and 
you have performed menial services in order that the object shall 
never again do a favour to your desire. If then our mutual thraldom 
to the object at the beginning of the process is now seen to be in 
reality the relationship between master and slave, that is merely 
the crude and frank expression of our essential relationship. 
 Our mutual value is for us the value of our mutual objects. Hence 
for us man himself is mutually of no value. 
 Let us suppose that we had carried out production as human beings. 
Each of us would have in two ways affirmed himself and the other 
person. 1) In my production I would have objectified my 
individuality, its specific character, and therefore enjoyed not 
only an individual manifestation of my life during the activity, but 
also when looking at the object I would have the individual pleasure 
of knowing my personality to be objective, visible to the senses and 
hence a power beyond all doubt. 2) In your enjoyment or use of my 
product I would have the direct enjoyment both of being conscious of 
having satisfied a human need by my work, that is, of having 
objectified man's essential nature, and of having thus created an 
object corresponding to the need of another man's essential nature. 
3) I would have been for you the mediator between you and the 
species, and therefore would become recognised and felt by you 
yourself as a completion of your own essential nature and as a 
necessary part of yourself, and consequently would know myself to be 
confirmed both in your thought and your love. 4) In the individual 
expression of my life I would have directly created your expression 
of your life, and therefore in my individual activity I would have 
directly confirmed and realised my true nature, my human nature, my 
communal nature.  
Our products would be so many mirrors in which we saw reflected our 
essential nature. 
 This relationship would moreover be reciprocal; what occurs on my 
side has also to occur on yours. 
 Let us review the various factors as seen in our supposition: 
 My work would be a free manifestation of life, hence an enjoyment 
of life. Presupposing private property, my work is an alienation of 
life, for I work in order to live, in order to obtain for myself the 
means of life. My work is not my life. 
 Secondly, the specific nature of my individuality, therefore, would 
be affirmed in my labour, since the latter would be an affirmation 
of my individual life. Labour therefore would be true, active 
property. Presupposing private property, my individuality is 
alienated to such a degree that this activity is instead hateful to 
me, a torment, and rather the semblance of an activity. Hence, too, 
it is only a forced activity and one imposed on me only through an 
external fortuitous need, not through an inner, essential one. 
 My labour can appear in my object only as what it is. It cannot 
appear as something which by its nature it is not. Hence it appears 
only as the expression of my loss of self and of my powerlessness 
that is objective, sensuously perceptible, obvious and therefore put 
beyond all doubt. 
  



NOTES
[1] Translated as "Monetary System": This was a specific belief 
among early Mercantilists. They contended that wealth consisted in 
money itself, in building bullion reserves. It's because of this 
that the export of gold or silver was not allowed, forcing active 
trade balances between nations. 
 [2] This passage reads, in the original German: "Durch die 
wechselseitige Entusserung oder Entfremdung des Privateigentums ist 
das Privateignetum selbst in die Bestimmung des entusserten 
Privateigentums geraten." It demonstrates that, when using the terms 
"Entusserung" and "Entfremdung" to denote alienation, Marx imparted 
to them an identical, or nearly identical, meaning. In all 
translations from early Marx, the Collected Works translates 
Entusserung as "alienation" and Entfremdung as "estrangement." They 
made this decision based on the fact that Marx would later (Theories 
of Surplus-Value ) directly employ the word alienation as the 
English equivalent of Entusserung. 
 [3] This refers primarily to James Mill, who divided his system of 
political economy into four independent sections: Production, 
Distribution, Exchange and Consumption. 
 [4] The rest of the conspectus contains further excerpts from 
Mill's book. After the excerpts dealing with the question of land 
rent, capital profit and wages as sources of taxation and state 
revenues, Marx wrote: 
 "Needless to say, Mill, like Ricardo, denies that he wishes to 
impress on any government the idea that land rent should be made the 
sole source of taxes, since this would be a partisan measure placing 
an unfair burden on a particular class of individuals. But -- and 
this is a momentous, insidious but -- but the tax on land rent is 
the only tax that is not harmful from the standpoint of political 
economy, hence the only just tax from the point of view of political 
economy. Indeed, the one doubt raised by political economy is rather 
an attraction than a cause for apprehension, namely, that even in a 
country with an ordinary number of population and or ordinary size 
the amount yielded by land rent would exceed the needs of the 
government." 
 
    


