Two Letters of Friedrich Engels

Vijay Singh

August 5th, 1995 was the death centenary of Friedrich Engels, the co-founder with Karl Marx of the Marxist theory, who made great contributions to the elaboration of dialectical materialism, historical materialism, political economy and scientific communism. Lenin emphasised that it 'is impossible to understand Marxism and to propound it fully without taking into account all the works of Engels.' As a tribute to this devoted revolutionary fighter and theoretician 'Revolutionary Democracy' publishes two letters of Engels which appear in a complete form in English for the first time in any country. Although these letters have been published in the collected works of Marx and Engels both in German and Russian they have been passed over in silence over the last four decades as they strike at the very heart of subjective idealism in the realm of the political economy of socialism.


In the letter translated below Engels criticised the view expressed by Kautsky that after the abolition of commodity production value 'alters' itself, that value in itself remained but in a 'changed' form. He argued that economic value was one of the categories belonging to commodity production and vanished with it.

The history of 'altered' or 'transformed' value did not end with this discussion between Engels and Kautsky. The 'transformed' and 'altered' value made a regular appearance in the communist movement whenever attempts were made to justify the retention or expansion of commodity-money relations in revolutionary societies. In the 1920s a number of economists projected the view of the 'altered' and 'modified' commodity within the Soviet Union. In the discussions which took place in the Communist Academy in 1924. A.F. Kon argued that in the Soviet economy the form of the capitalist regulator was preserved through exchange but with a changed content (N.C. Shukov, 'Politicheskaya ekonomiya sotsializma v 20-e gody', Moscow, 1991, p. 198, emphasis added). V. Chernomordik considered that the law of value was transformed under the influence of planning (ibid., p. 203). Preobrazhensky, the major economist close to Trotsky, argued that commodity-money categories in the state sector transformed and changed their role and function: 'Our state economy within certain bounds shows that under the forms of exchange relations, their content in changing' (ibid., p. 200, emphasis added). In 1926 he said that 'Marx and Engels said that the law of value is superseded in the last analysis, but did not go into the question of the transformation of this law in the course of the transitional epoch' (E. Preobrazhensky, 'The New Economics', Oxford, 1965, p. 22, emphasis added).

Such views persisted into the period after the Second World War. This is clear from Stalin's last work where he criticised a number of erroneous views in political economy which had become apparent after the November 1951 Discussion on the projected Textbook of Political Economy. Very much consonant with the spirit and letter of Engels' Letter to Kautsky, Stalin denied that the law of value had been 'transformed' or even 'radically transformed' on the basis of the planned economy. He noted that the formula that economic laws could be 'transformed' had been current in the Soviet Union for a long time but had to be abandoned for the sake of accuracy. Stalin argued that laws could not be 'transformed' as the laws of political economy exerted their influence independent of the will of man, the Soviet government and its leadership. The sphere of action of a particular law could be restricted but it could not be 'created' or 'transformed'. (J. Stalin, 'Economic Problems of Socialism in the USSR', Moscow, 1952. pp. 11-12).

'The Textbook of Political Economy' which was eventually published in the USSR in August, 1954 contained views which were in contradiction to the views of Engels and Stalin: 'The new conditions arising as a result of the victories of socialism, change the character of commodity production and commodity circulation and the organic sphere of their operation'. ('Politicheskaya ekonomiya-Uchebnik', Moscow, 1954. p. 402, emphasis added.) In the same spirit it was argued that the nature of money 'changed' under socialism: 'Money is an economic category, which, preserving its old form, in a fundamental manner changes its nature in conformity with the requirement of the development of the socialist economy (ibid., p. 449, emphasis added).

The re-emergence of the notion of the 'altered' commodity in the Political Economy Textbook of 1954 corresponded to the changes which had taken place in the USSR between the death of Stalin in March, 1953 and the 17th August, 1954 when the manuscript of the text book went to the press. The programme for the gradual extension of products-exchange between state industry and the collective farms was de facto abandoned in May, 1953 and measures were introduced to expand the sphere of commodity circulation. The first major step to terminate the system of directive planning, under which all economic organisations were obliged to carry out the decisions of the planning authorities, was initiated in April, 1953, by which the powers of the All-Union Soviet ministries were expanded. In this manner the powers of Gosplan were reduced. The September, 1953 Plenum of the CPSU incepted policies which in previous years had been identified as 'Rykovism'. Commodity-money relations were expanded systematically. Prices for fixed delivery and the purchase prices for the main agricultural goods were considerably raised. The quantum of obligatory deliveries of grain, potatoes, vegetables, oilseeds and livestock products by the collective farms was reduced. Arrangements are made for the collective farms to partially remove themselves from centralised planning by permitting them to decide the size of their crop area, the yield of certain crops, the number of livestock and the productivity of animal husbandry. ('History of the CPSU', Second revised edition, Moscow, n.d., p. 639).

The notion of an 'altered' value appeared in different forms in the Asian people's democracies. As in Central and Eastern Europe the initial revolutionary thrust was directed against imperialism and the pronounced survivals of feudalism which permitted the preservation of the middle bourgeoisie in the course of the democratic revolution. Only in the second, socialist, stage of the people's democracies was the question broached of terminating the continued existence of this middle bourgeoisie. Dimitrov indicated the perspectives of socialism in 1948: 'The correctness of the Party's policy for the liquidation of the capitalist system and the construction of socialism in our country through an uncompromising class struggle against the capitalist elements and through adoption of the planning principle in our economy is not disputed by anyone in our party'. This programme involved the following understanding regarding the future of the urban bourgeoisie: 'The last vestiges of the exploiters' classes in the towns -- the urban bourgeoisie will be economically liquidated (G. Dimitrov: 'Political Report to the Vth Congress of the Bulgarian Communist Party', Sofia, 1949, p. 85, 78, emphases added).

Some four years later the CPC, too adopted the programme for socialist construction in China as the second stage of people's democracy. It was correctly recognised in 1952 that: 'With the overthrow of the landlord class and the bureaucratic-capitalist class, the contradiction between the working class and the national bourgeoisie has become the principal contradiction in China' ('Selected Works of Mao Tsetung, Vol. V, Peking, 1977, p. 77). After the 20th Congress of the CPSU and the 8th Congress of the CPC however the liquidation economically of the middle bourgeoisie was no longer considered obligatory. The logic of the CPC was as follows: 'The contradiction between the national bourgeoisie and the working class is one between exploiter and exploited, and is by nature antagonistic. But in the concrete conditions of China, this antagonistic contradiction between the two classes, if properly handled, can be transformed into a non-antagonistic one and be resolved by peaceful methods' (ibid., p. 386, emphasis added).

The notion of 'transformed' value, considered wholly impermissible for Marxists by Engels and Stalin, was sought to be applied to a section of the bourgeoisie on the ground of the - unspecified - concrete national conditions of a particular country. As a consequence the 'transformed' national bourgeoisie was considered exempt from the laws of motion of the commodity which Marx in 'Capital' had argued was the basic cell of capitalism. In his tract on political economy Stalin argued that as contradictions continued to operate in socialist society, if incorrect policies were followed by the directing bodies then contradictions between the productive forces and the relations of production could become antagonistic (J. Stalin, ibid., p. 75). This did not normally occur as socialist society did not include obsolescent classes that might organise resistance (ibid., p. 57). After 1954 when the People's Republic of China declared itself as a socialist society it was asserted in effect that obsolescent classes could be incorporated in the 'socialist' state and society. It was argued that if national capital were 'properly handled', (Mao Tsetung, loc. cit.) it could be incorporated within 'the classes, strata and social groups which favour, support and work for the cause of socialist construction' (Mao Tsetung, ibid., p. 385). After 1953 the CPC shrank from the nationalisation of the property of the middle bourgeoisie, i.e., from the economic liquidation of the national bourgeoisie specified by Dimitrov as the sine qua non for the transition to socialism in a people's democratic state. The notion of the 'transformed' character of Chinese national capital corresponded to this political and economic compromise; it offered the theoretical justification for the eternal preservation of middle capital in the basis and superstructure in the 'socialist' stage of peoples democracy. These policies received support from the CPSU. At the 20th Congress of the CPSU it was noted that much that was unique in socialist construction was being done in the People's Republic of China: 'Having taken over the decisive commanding positions, the people's democratic state is using them in the social revolution to implement a policy of peaceful reorganisation of private industry and trade and their gradual transformation into a component of socialist economy', (N.S. Khrushchov, 'Report of the C.C. of the CPSU to the 20th Party Congress', Moscow, 1956, p. 43, emphasis added). The formulations of the CPC were replicated in the other people's democracies of Asia, in Korea and Vietnam, as well as in the German Democratic Republic.

I - Engels to Karl Kautsky in Zurich

London, 20 Sept. '84

Dear Kautsky,

Enclosed herewith the manuscript1 returned by registered post. Your article about R[odbertus] was very good, as far as the economic aspects are concerned; what I find wrong with it again are apodictic statements in fields in which you are yourself not certain and in which you expose weaknesses to S[chramm] which he was clever enough to seize upon.

This particularly with regard to the "abstraction" which you at any rate criticised far too generally. The difference in this case is as follows:

Marx sums up the common content existing in things and conditions in their most general conceptual expression, his abstraction thus merely gives in conceptual form the content already existing in things.

As against this, R[odbertus] produces a more or less complete conceptual expression and measures the things against this concept by which they are supposed to be governed. He looks for the true, eternal content of things and of social conditions which however are essentially transient. Hence authentic capital. What we have at present is not this but only an incomplete realisation of the concept. Instead of deriving the concept of capital from capital which is contemporary, which alone really exists, he sets out to arrive at authentic capital from present day capital and makes use for this purpose of the isolated human being by asking what could well figure as capital in his production. Namely the simple means of production. With this, authentic capital is thrown - without further ado - together with the means of production which, depending on the circumstances, is capital or it is also not. With this all bad properties, that is all real properties of capital, are removed from capital. Now he can demand that real capital should be modelled after this concept, that is it should function only as simple social means of production, remove everything which makes it into capital and still remain capital, in fact precisely in this manner become authentic capital.

You do the same thing with value. Present value is that of commodity production, but with the abolition of commodity production value also "changes", i.e. value in itself remains, it only changes form. But in fact economic value is a category belonging to commodity production with which it disappears (see "Dühring", pp. 252-622) and before which it did not exist. The relationship of work to product does not express itself before commodity production and after it any more in the form of value.

Luckily S[chramm] is also not philosophically sound and exposes weak spots which you have comprehended and presented very well. Moreover:

1. Schr[amm] knows material interests which do not - directly or indirectly - come from the mode of production. Compare this with Marx "Critique", Preface,3 where the matter is briefly presented in 20 lines.

2. Rodb[ertus]' critique of existing society was made just as well and better long before him by the English and French Utopians, the same by the post-Ricardo socialist school of economists who based themselves on R[icardo's] theory of value: Marx quotes some of them in the "Misère", pp. 49, 50.4

3. The Robinson in Marx5 is the authentic one, of the original Robinson by Daniel Defoe, from which the accessory circumstances have been copied - the pieces saved from the shipwreck etc. He later also has his Friday and was a shipwrecked merchant who, if I am not mistaken, at times also carried on slave trade. An authentic "bourgeois" therefore.

4. To speak of the Marx[ist] historical school was certainly over-anticipation. I would shorten the passage of your reply and refer above all to M[arx] himself. The above-mentioned passage from the "Critique", thereafter "Capital" itself, particularly primitive accumulation,6 where S[chramm] can also find out about the chicken and the egg.

Otherwise it is truly fortunate that all bourgeois elements now group themselves around Rodb[ertus]. We cannot wish it any better.

You would have received your Ms. "Misere".7 Ede would have also received my letter with contribution to the election fund of last Sunday.

Tussy requests that in future the "Soz[ialdemokrat]" etc. be sent at the address:

Mrs. Aveling
55, Great Russell St. W.C. London


Bebel's letter enclosed.

So we expect you here in Jan.-Febr. "To-Day" has become a mere "symposium", i.e. a review in which everyone can write for and against socialism. Next No. a critique of "Capital"!8 I was supposed to reply to this anonymous writer, but declined with thanks. Dr. Drysdale has also written in it, quotes you in support,9 there is a reply from Burrows, who asked about you. I have taken care of what was necessary, but somewhat warily, as I did not know whether Dr[ysdale] did not have your book.

Karl Marx, Friedrich Engels: Werke, Volume 36, Dietz Verlag, Berlin, 1979, pp. 209-11.

Translated from the German by Shaswati Mazumdar.


1. In August and September 1884, Karl Kautsky had published in "Neuen Zeit" his critique "Das Kapital of Rodbertus". Carl August Schramm replied to Kautsky in the same journal. Kautsky wrote a reply to this which together with Schramm's manuscript he sent to Engels for evaluation. Schramm's article "Karl Kautsky and Rodbertus and Kautsky's Reply" appeared in the November issue of "Neuen Zeit".

2. Frederick Engels: "Anti-Dühring, Herr Eugen Dühring's Revolution in Science", in Karl Marx, Frederick Engels 'Collected Works', Volume 25, Progress Publishers, Moscow, 1987, pp. 286-290.

3. "A Contribution to the Critique of Political Economy", Karl Marx, Frederick Engels, 'Collected Works', Volume 29, Progress Publishers, Moscow, 1987, pp. 261-265.

4. "The Poverty of Philosophy", Karl Marx, Friedrich Engels, "Werke", Volume 4, Dietz Verlag, Berlin, p. 98.

5. "Das Kapital", Volume I, "Werke", Volume 23, Dietz Verlag, Berlin, pp. 90-93.

6. Ibid., pp. 741-791.

7. The reference is to the translation of Marx's work "The Poverty of Philosophy" by Eduard Bernstein and Karl Kautsky.

8. The reference is to "Das Kapital. A Criticism by Philip H. Wicksteed" in No. 10 of the periodical "To-Day" of October, 1884.

9. In his article "The State Remedy for Poverty" in No. 9 of "To-Day" of September 1884, C.R. Drysdale referred to Karl Kautsky as a 'zealous socialist' who recognises the 'full' truth of the population theory of Malthus. C.R. Drysdale cited Kautsky's book "The Influence of Population Explosion on the Progress of Society", Vienna, 1880.


In the letter of Engels to August Bebel of January, 1886, Engels argued that Marx and he had considered the cooperative system in industry and agriculture to be an intermediate stage in the transition to the full communist society. The means of production must remain initially in the hands of the state and later be controlled by society. Land ought to be owned by the state and the large landholdings to be transferred, initially, on lease to the self-managing co-operatives under state supervision. Society required to retain the ownership of the means of production in the co-operatives of town and country so that the private interests of the cooperatives could not establish themselves vis-a-vis the interests of society as a whole.

In the USSR these guidelines were followed until 1958. The land in Soviet Russia had been nationalised with the October Revolution. The USSR Constitution of 1936 reiterated that the land, the natural deposits, waters and forests were state property belonging to the whole people ('Constitution [Fundamental Law] of the USSR', Moscow, 1945, p. 52). The basic implements of production in agriculture were not owned by the collective farms but by the Machine Tractor Stations which constituted an integral part of the state property of the whole people. In 'Economic Problems' Stalin opposed the view advocated by A.V. Sanina and A.G. Venzher that the basic implements of production concentrated in the MTS be sold to the collective farms. He argued that a gigantic quantity of instruments of agricultural production would come within the orbit of commodity circulation (J. Stalin, 'Economic Problems of Socialism in the USSR', Moscow, 1952, p. 101), and reminded Sanina and Venzher that Engels in 'Anti-Dühring' had stated that the existence of commodity circulation was inevitably bound to lead the 'economic communes' of Dühring to the regeneration of capitalism (ibid., p. 102). The proposal advocated by Khrushchev in the post-war period encouraging the collective farms to construct auxiliary enterprises for the manufacture of bricks, tiles and other items also implied the existence of means of production outside the state sector and instead centred on the co-operative property of the collective farms. This measure was correctly criticised by Malenkov in 1952 (G. Malenkov, 'Report to the 19th Congress on the Work of the C.C. of the CPSU (B)', Moscow, 1952, pp. 75-76.)

The positions defended by Engels and Stalin were relinquished in the Khrushchev years. In 1958 the basic implements of production in agriculture which were owned by the MTS were sold to the collective farms. As a result a 'gigantic' quantum of the means of production now entered the sphere of commodity circulation. Pari passu, those sectors of state industry which had produced agricultural machinery under the plan and which were allocated to the MTS now engaged in commodity production which produced these goods as commodities to be sold on the collective farm market. The realm of commodity production was further extended by the collective farms which were permitted to build power stations and industrial enterprises for the purposes of processing food products. ('History of the CPSU', Moscow, n.d., Second revised edition, p. 670). Khrushchev successfully pushed through his earlier proposal, which had been shot down by Malenkov, for the collective farms to produce bricks and tiles (N.S. Khrushchov, 'Report of the CC of the CPSU to the 20th Party Congress,' Moscow, 1956, p. 82). The dissolution of the MTS did not take place without resistance: both the political leadership and the political economists were divided over the matter and the measure could only be implemented after Molotov and Kaganovich had been removed from the leadership of the CPSU in 1957. It is instructive to note that a number of economists who desired to see the retention of the MTS cited Engels' Letter to August Bebel of January, 1886. This was decried by the Khrushchevite school of political economy represented by persons such as A.V. Bulgov (P.S. Buyanov et al (eds.) 'Novyy etap v razvitii kholkozhogo stroya', Moscow, 1959, p. 95).

In the early years of the People's Republic of China the property relations in agriculture were modelled on the experience of the USSR and the people's democracies of Central and Eastern Europe. During the revolutionary war and in the course of the agrarian revolution of 1950-52 feudal landownership was abolished in China and feudal exploitation ended. In common with the practise on the agrarian question adopted in the European people's democracies land in general was not nationalised in China. Only the land adjoining the towns, mineral wealth, waters, state forests, virgin lands, formed a part of state property belonging to the whole people. In the realm of agriculture, state property included the state farms, agro-technical stations, machine-hiring depots and the MTS ('Political Economy', Textbook, Second edition of 1955, London, 1957. p. 791). By the beginning of 1955 there were over an hundred large mechanised State farms, about 2000 country and district State farms, and about one hundred MTS (ibid., p. 809). A total of 194 MTS were to be established during the course of the First Five-Year Plan (Li Fu-Chun 'Report on the First Five-Year Plan for Development of the National Economy of the PRC in 1953-57,' Peking. 1955, p. 26).

Already in 1956 the collective farms were permitted to own the basic implements of production in agriculture as is apparent from the Model Regulations for the higher and lower Agricultural Producers' Cooperatives (Tung Ta-lin, 'Agricultural Co-operation in China', Peking, 1959, p. 112, 154). Thereafter the very term MTS disappeared from the literature on the agricultural question in China. The People's Communes formed in 1958 were thirty times larger than the former average advanced cooperative and integrated industry, agriculture, trade, education and defence, merging government administration and commune management ('National Programme for Agricultural Development 1956-1967', Peking, 1960, pp.32-33). The communes incorporated the former agricultural producers' co-operatives of the higher type, the artisan producers' cooperatives where the means of production were the co-operative property of their members, as well as the supply-sales, consumer and credit cooperatives ('Politicheskaya ekonomiya, Uchebnik', Third Edition, Moscow, 1958, p. 354).

As was pointed out by the leadership of the CPC, 'In the communes not only land and machinery but labour, seeds, and other means of production as well are commune-owned. Thus the output is so owned' (Mao Tsetung, 'A Critique of Soviet Economics', New York, 1977, pp. 144-5). Thousands of rural industries were established in the communes including modern fertiliser plants. The output value of rural industries run by the people's communes reached about 10,000 million yuan in 1959 ('National Programme', op. cit., pp. 367). The fact that the communes owned the basic means of production, the land, the basic agricultural machinery, and, also operated commune-based industries meant that a 'gigantic' quantity of the means of production was outside the sector of state property which constituted the property of the whole people. In addition to this the sphere of commodity production embraced the advanced state capitalist sector in the form of the joint state-private enterprises in which the national bourgeoisie in industry and trade had a total investment of some 2,418 million yuan (Kuan Ta-tung, 'The Socialist Transformation of Capitalist Industry and Commerce of China', Peking, 1960, p. 87). This meant that a vast sector of commodity production and circulation existed in China by 1958 in contrast to the USSR in the period of Stalin.

Mao Zedong did not seem to be aware of the existence of Engels' Letter to August Bebel of January, 1886 which enjoined that the basic means of production in the cooperatives required to be owned by society as a whole so that the private interests of the cooperatives did not over-ride the general interests of society. He was aware of Stalin's criticism of the views of A.V. Sanina and V.G. Venzher who had advocated the dissolution of the MTS and the sale of the basic implements of production to the collective farms. Mao Zedong rejected the understanding of Engels and Stalin and argued that 'In Chinese agriculture there are still many means of production that should be commodities' (Mao Tsetung, op. cit., p. 130). He argued that Stalin's 'Reply to Comrades A.V. Sanina and V.G. Venzher' was 'entirely wrong' (loc. cit.), stating that the letter 'expresses a deep uneasiness, a belief that the peasantry cannot be trusted to release agricultural machinery but would hang on to it' (loc. cit., emphasis added), and that 'Mistrust of the peasants is the basic viewpoint of the third letter' (op. cit., p. 136, emphasis added). The view of Marxist political economy on the elimination of the operation of the law of value with regard to the basic implements in the agricultural sector had to be discarded, then, because it appeared to imply 'mistrust' in the peasantry and not because there could be conflict between the interests of the cooperatives and the general interests of society. This ratiocination was not unique for it was also prevalent in the USSR. The Ukrainian journalist, Ivan Vinnichenko, who was closely aligned to A.V. Sanina, V.G. Venzher and Khrushchev, and who had pushed the view in the press from 1957 itself that it was necessary to dissolve the MTS and hand over the agricultural machinery to the collective farms, argued that under the 'cult of personality' of Stalin there existed a 'basic dogma' that the sale of machinery to the kolkhozy would deprive the state of its chief economic lever in guiding the kolkhozy system. Stalin, argued Vinnichenko, 'simply did not trust the kolkhoz peasantry and therefore feared to release it from his grip' ('Literaturnaya Gazeta', No. 22, 28th February 1962, p. 2, emphasis added).

II - Engels to August Bebel in Berlin

[London] 20 January '86

Dear Bebel,

The warning shot has been fired. Schramm has done me the honour of sending me a copy of the terrible work, but I have to say, it is quite pauvre,1 and the early reference to it in the "S[ozialdemokrat]" gave him far too much credit. Ede is sure to tell him what's what, I have already drawn his attention to some points which I noticed, and the main things he will find himself.2

For K[autsky] this entire polemic with Schr[amm] has been very useful.3 Schr[amm] is clever enough - as he himself cannot say anything in the matter - to pick out all the mistakes in form which K[autsky] makes, partly because of his youthful zeal, and partly due to his acquired university and literary praxis, and this was a very useful lesson for him. In this respect, Ede - because of not being a university person, nor a litterateur by profession, yet constantly engaged in struggle in the "S[ozialdemokrat]", moreover a businessman and, not least of all, a Jew - is even now head and shoulders above K[autsky]. One simply learns war only in the middle of war.

Your news about the mood in the fraction was very encouraging.4 As long as the Party remains good - and in that situation petty bourgeois behaviour will certainly not get the upper hand -, the mistakes of the esteemed deputies can only serve the purpose of bringing home hard lessons for the deputies themselves. As you yourself say, and this is also my opinion, we never get quite the right kind of people into the Reichstag, and so the help extended to us by the Party through its pressure on the esteemed deputies cannot be valued highly enough; this shows them that they have to avoid any serious conflict, and the certainty that it is so can acquire great importance in a decisive moment because it gives us the certainty that one can resolutely step forward without coming to harm.

Of late, Lieb[knecht] has been bombarding me with letters for information about all sorts of things. I used the opportunity to tell him in all friendliness but firmly5 what I thought of his contradictory behaviour, and when he as usual wanted to put the blame on the gossip which has surrounded me, I told him that the only person who could find fault with me was called W. Liebknecht who always forgot what he had written in letters and got published in newspapers. Apart from this, we would just have to accept these weaknesses of his and would do this all the more easily if we knew that in the really decisive moment he would of course be found in the right place. At which, contrary to his habit of always having the last word, he calmed down.

Since he mentioned the story of the Schleswig-Holstein canal, I used the opportunity to tell him that it would be unwise to vote for a shallow canal, less than 8-9 metres deep, because of an opposition to the use of the canal by the fleet. The big trading steamships are getting ever bigger, 5-6000 tons are quite common already, and the ports are being more and more equipped for the required draught. Those which cannot, are afflicted by obsolescence and decay, and this will be the case in the Baltic Sea as well. If the Baltic Sea is to take an active part in overseas trade, sufficiently deep harbours will have to be built, and this will happen there as surely as elsewhere. But building the canal in such a manner that it is as useless and decayed in 10-20 years as the old Erder Canal would mean throwing money out of the window.

As for my suggestion regarding the production cooperative in domains,6 it only had the purpose of showing the majority, which at that time was for the steamship subsidy, a way out, showing them how they could gracefully vote against it and come out of the cul-de-sac in which they were stuck. However, it was in principle correct in my opinion. Absolutely right, we should only make feasible suggestions when we suggest something positive. But feasible in terms of the matter at hand, irrespective of whether the existing government can carry it out. I go even further: when we suggest socialist measures (such as these) which would lead to the overthrow of capitalist production, then only such measures which are objectively practical but impossible for this government. For, this government will mess up and wreck all such measures, only carrying them out to ruin them. However, no Junker or bourgeois government will carry out this suggestion. Showing the rural proletariat the way, putting it on the path on which it can wipe out the exploitation by the Junkers and the tenant farmers - drawing into the movement exactly those people whose enslavement and stupefaction supplies the regiments on which entire Prussia rests, in short, destroying Prussia from inside, at the roots, this would not occur to them. This is a measure which we must under all circumstances press for as long as large landed property remains there, and which we must ourselves carry out as soon as we come into power: the transfer - initially on lease - of the large landholdings to self-managing cooperatives under state supervision and in such a manner that the state remains the owner of the land. The measure has, however, the great advantage of being practically feasible, objectively speaking, but that no Party other than ours can take it up, and also that no Party can bungle it. And with that alone Prussia is done for, and the earlier we popularise it, the better it is for us.

The matter has nothing to do with either Sch[ulze]-Delitzsch or with Lassalle. Both propagated small cooperatives, the one with, the other without state help; however, in both cases the cooperatives were not meant to come under the ownership of already existing means of production, but create alongside the existing capitalist production a new cooperative one. My suggestion requires the entry of the cooperatives into the existing production. One should give them land which otherwise would be exploited by capitalist means: as demanded by the Paris Commune, the workers should operate the factories shut down by the factory-owners on a cooperative basis. That is the great difference. And Marx and I never doubted that in the transition to the full communist economy we will have to use the cooperative system as an intermediate stage on a large scale. It must only be so organised that society, initially the state, retains the ownership of the means of production so that the private interests of the cooperative vis-a-vis society as a whole cannot establish themselves. It does not matter that the Empire has no domains; one can find the form, just as in the case of the Poland debate, in which the evictions would not directly affect the Empire.7

Precisely because the government can never accept such things, precisely for this reason it would not have been hazardous to demand the allocation suggested by me as a counterpart to the steamship allocation. If the government had been able to accept it, you would naturally have been right.

The crumbling of the German liberals in the economic field corresponds exactly to what is happening to the English radicals. The old Manchester men à la John Bright are dying out and the younger generation, exactly like the Berliners, is doing patchwork social reforms. Only that here the bourgeois does not want to help either the industrial worker or the agricultural labourer who just rendered him such excellent service in the elections and that neither the state nor the community is supposed to intervene in English manner. Little gardens and potato patches for the agricultural workers, improvements in sanitation and the like for the urban workers, that is their programme. It is a splendid sign that the bourgeois must already sacrifice their own classical economic theory, partly for political considerations, but partly because they themselves have been compelled by the practical consequences of this theory to have doubts about it. The same is proved by the growth of Katheder socialism8 which in one or the other form is more and more dislodging classical economics from the university chairs both here and in France. The actual contradictions created by the mode of production have become so glaring that they just cannot be glossed over by any theory, unless it is the Katheder socialist hodgepodge which is no longer a theory but rubbish.

6 weeks ago there was talk here that symptoms of improvement in business had appeared. Now all that has already died down again, want is greater than ever and hopelessness too, added to that an unusually hard winter. This is now already the eighth year of overproduction in the markets, and it is getting worse rather than better. There is no doubt any more that the situation has substantially changed from earlier; since England acquired significant rivals in the world market, the period of crisis in the hitherto existing sense has ended. If the crises go from acute to chronic, thereby not losing their intensity, how can this end? A period of prosperity, even if short, must return once again after the swarm of commodities has dispersed; but I am eager to see how all this will shape up. Two things are certain: we have entered a period which is incomparably more dangerous for the continuance of the old society than the period of the 10-yearly crises, and secondly: England will be far less affected by the prosperity, when it comes, than earlier when it alone skimmed off the cream from the world market. On the day when this becomes clear here, on that day the socialist movement here will become earnest, not earlier.

About the composition of the English liberals, another time. That is an extensive theme because it describes a state of transition.

I received the debate about the motion on Poland (1st day) this morning. The 2nd day must be on its way. These parcels are all the more important for me since I now only see the weekly edition of the "Köln[ische] Zeitung" which only gives very short excerpts of the debates. How are the stenographic reports sold? I will gladly pay for all debates in which our people seriously intervene.

You should under all circumstances go along on the trip to America. On the one hand, success depends very much on your also being present. Secondly, the Party is fully and truly represented only when you are there. If you don't go, the first comer will be sent with L[iebknecht] and who knows what will happen then. Thirdly, you should not miss the opportunity of seeing with your own eyes the most progressive country in the world. Life in the German conditions exercises on everyone, even on the best, a depressing and cramping influence. I know this from my own experience. At least from time to time one must get out. If I could get away from my work I would have sailed across once long ago, I always hoped9 to be able to do it once with M[arx]. You know that abroad you and L[iebknecht] represent the Party, and neither of you can be replaced. If you stay away there will be a deficit of 5,000 to 10,000 Marks, perhaps more.

But it can also become a very pleasant affair. You must know that Tussy and Aveling are in correspondence with the American Freethinkers about a probable trip to that place and wish to tie it up with yours. The reply will probably be here in 3-4 weeks. That would make a very nice travel Party of four.

For today, I wish you good health. Apropos, Ede surpassed my expectations in his first article against Schr[amm]. Absolutely excellent. He has actually learnt the strategy and tactics of war.


23 Jan.

Karl Marx, Friedrich Engels: Werke, Volume 36, Dietz Verlag, Berlin, 1979, pp. 424-428.

Translated from the German by Shaswati Mazumdar.


1. Wretched. French in the original.

2. Engels refers to the book by Carl August Schramm 'Rodbertus, Marx, Lassalle - A Social Science Study', published from Munich in 1885 which was a continuation of the polemics between Kautsky and Schramm. It was announced in "Sozialdemokrat" on 10th December 1885 under the rubric 'Social-Political Round-up' under the heading 'Clarification'. In his polemics Schramm sought once again to underplay the significance of Marx as a theoretician and practitioner of socialism. Bernstein replied in a series of articles entitled 'A Moral Critique and his Critical Method' in "Sozialdemokrat" on 21st and 28th January, and 12th February, 1886.

3. Karl Kautsky and Carl August Schramm engaged in polemics from August to November 1885 on the significance of Marx and Rodbertus. Subsequently, in the January issue of "Neuen Zeit" Engels' foreword to the German translation of Marx's "The Poverty of Philosophy" was published under the title "Marx and Rodbertus" Schramm continued these polemics until 1885.

4. In a letter of Engels dated 7th December 1885, August Bebel indicated that the opportunist majority of the Reichstag Fraction was 'as good as finished'. Bebel also pointed out the various thrusts of the Reichstag fraction as, for instance, with respect to the Bill concerning the deportation of Poles and others and expressed the hope that the fraction should not repeat the stupidities of the previous session.

5. The fate of this letter is not known.

6. Engels in a letter to August Bebel in Berlin dated 17th November, 1885 noted that state help was being provided to the bourgeoisie which was coming out of the pockets of the workers and peasants. Engels argued that this should not be opposed but it would be justified only if similar help was approved for the urban and rural workers, especially to establish cooperative farms on the state domains.

7. In November, 1885 the fraction of the Polish minority in the Reichstag brought in an interpellation directed against the expulsion of non-Germans from the eastern provinces of the Prussian state. This interpellation was signed also by the Social-Democrats. In the session of the Reichstag of 1st December, 1885, Bismarck read out the message of Wilhelm I which denied the competence of the Reichstag in this matter. Nevertheless the question came to be debated. Bebel participated in this and gave the reasons why the Social-Democrats had supported the interpellation and stressed the competence of the Reichstag. In the Reichstag session of the 15th and 16th January, 1886, discussion took place on the Social-Democratic sponsored Bill demanding the revocation of the mass expulsion of non-Germans from the eastern areas.

8. The Katheder socialists were a bourgeois reformist trend of 'National Economists' which was formed in the last third of the nineteenth century. This trend opposed the supporters of the Manchester School which reflected the interests of industry, it demanded the intervention of the bourgeois state in reducing social contradictions through reforms so as to impede the spread of the revolutionary workers' movement and the political class struggle of the workers. The most famous representatives of Katheder socialists - literally the socialists of the University Chairs - were Lujo Brentano, Gustav Schmoller, Adolph Wagner and Albert Eberhard Friedrich Schäffle. In 1873 this group founded the Association for Social Policy.

9. In the handwritten script: hope.

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