# Notebook "α"

(“ALPHA”)

Contents

Notebook α. Pp. 1–48.

Recent economic literature.
Contents:
1–3[1]End of Schulze-Gaevernitz (from Social Economics) + 31–35 (Vogelstein).
4.Outline for an article on the struggle against the “Marsh”. ((Notes on Kautskyism.))
5.Source references.
6.Ravesteijn on the Balkan problem (Die Neue Zeit, 1913).
7–8.Werner on concentration in the Ruhr mining industry (Die Neue Zeit, 1913).
9.Meyer (capital investment) and source references.
10.
11–12.Liefmann on the Frankfurt metal trade.
13–14.Bourgeois scientists on the struggle against imperialism (“Subject races”).
15.Moride—“Multiple Stores”.
16.Source references.
17.Idem.
18.Schilder. Volume 5 of Weltwirtschaftliches Archiv (not his work).
19.Notes from Nashe Slovo.
20.
21.Source references.
22.Total capital in joint-stock companies.
23–28.Kestner, Compulsory Organisation.
29.Vienna Arbeiter-Zeitung on Viennese banks.
30.The Annals of the American Academy.
31–35.End of extracts from Social Economics.
36.
37.Source references.
38.Stillich, Money and Banking.
+41–42.
39-40.Liefmann, Cartels and Trusts.
43-48.From Social Economics ... (Schulze-Gaevernitz)
{{+1–3

and 31–35 }}

 p. 5 p. 21+32 || p. 44 p. 9 p. 37 || N.B. __ p. 46 p. 17+16 p. 38 p. 48

### Outline for an article on the struggle against the “Marsh”. (Notes on Kautskyism.)

Our Struggle Against the “Marsh”

The Marsh = K. Kautsky, Huysmans, etc.

Significance of the distinction between Plekhanov, Hyndman, Heine and K. Kautsky, Vandervelde, etc. 2 distinctions of “shades”. Eclectics instead of dialectics. The “middle way”:

• “reconciliation” of extremes, absence of clear, definite, firm conclusions; vacillation.
• Conciliation and blunting of class contradictions in words and their accentuation in reality.
• Conciliation with opportunism.
• Glossing over the theoretical and practical-political differences with opportunism.
• Repudiation (apostasy) of the Road to Power position and of the revolutionary essence (and revolutionary tactics) of the Basle Manifesto[2]....

The difference between the conceptions “Marxist centre” (= independent policy, independent ideas, independent theory) and “Marsh” (= wavering, lack of principle, “turn table” (“Drehscheibe”), weathercock).

 Illegal organisation. Work in the army. Support for and devel- opment of mass action. N.B. || Official optimism: the objective course of events ... everything is bound to be for the best. The “proletariat” and the “class struggle” “in general”. “Process”. N.B. || cf. Martov on the “hopeless- ness” of socialism if ... opportunism is hopeless!!!

Recognition of revolutionary activity along the lines indicated above, not denial of legal activity and of the struggle for reforms, should be the essence of the “struggle against the Marsh”.

The possibility of a fusion of socialism and syndicalism, should there be a new and deeper division.

Parliamentarism and a different conception of it. “Illegal parliamentarism”.

### SOURCE REFERENCES

From philosophical books in the Zurich Cantonal Library:

Gideon Spicker, On the Relation of Natural Science to Philosophy (especially versus Kant and Lange’s History of Materialism). 8°r;. Berlin, 1874.

Hegel, Phenomenology (Bolland edition, 1907).

[[BOX: Erich Kaufmann, The Foreign and Colonial Power of the United States, Leipzig, 1908 (in Studies in State and International Law, Vol. 1). A juridical study. Imperialist policy gave rise to the question of the colonies in America. ]]

Cantonal Library (Zurich).

Journal asiatique (Paris, 1857—to 1913 and table of the tenth series 11th series, volumes 1 and 2).

Giornale della società asiatica italiana, Vol. 1 (1887)—Vol. 26 (1913–14).

Kouznietsow, The Struggle of Civilisations and Languages in Central Asia. (Thesis.) 8°r;. Paris, 1912.

Lehmann-Haupt, Armenia. 8°r;. Berlin, 1910.

Büchler, Leopold’s Congo State, Zurich, 1912–14.

Fraisse, International Situation of the Dependent Countries of the Congo Basin, Their Division, 1907.

Kate Brousseau, Education of Negroes in the United States. Thesis. Paris, 1904. (American Writings and Reports on Education).

Census of India. (1911. Bombay. 1911.)

Moffet, The Americanisation of Canada. Thesis. New York, 1907.

Patouillet, American Imperialism. (Thesis. Dijon, 1904.)

Ed. Dettmann, The Rise of Brazil. A German View, 1908.

Hishida, The International Position of Japan as a Great Power. New York, 1905.

Lefèvre, Railways as a Means of Penetration into South China. Thesis. Paris, 1902.

Russier, The Partition of Oceania. Thesis. Paris, 1905.

### RAVESTEIJN ON THE BALKAN PROBLEM

W. van Ravesteijn, “The Balkan Problem”, Die Neue Zeit, 1913 (31st year, Volume I). November 15, 1912.

a federation” (of Balkan countries, including Turkey) “would be able to satisfy the cultural needs of this geographically integral area and to erect an insurmountable barrier to the advance of European | N.B.imperialism, and also of Russian world power. All other solutions of the Balkan problem can be only of a temporary nature and cannot for long satisfy the interests of all the races and nations that live there” (p. 228).

federation of all the Balkan countries will naturally be resisted by European imperialism and tsarism with all their strength. Their common interest, now as in the past, is aggravation of mutual enmity and rivalry between these nations and Turkey | N.B.so as the more easily to exploit their territories as colonial spheres. Will the statesmen of Turkey and the Balkan countries come to realise their common interests and put an end to this murderous war by entering into close relations with one another? | N.B.If they fail to do this, they will sacrifice the interests of their peoples to European capitalism and the interests of the Balkan dynasties” (p. 229).

### WERNER ON CONCENTRATION IN THE RUHR MINING INDUSTRY

G. Werner, “Concentration of Capital in the Ruhr Mining Industry”, Die Neue Zeit, 1913, p. 138 (October 25, 1912).

Ruhr area:

1) Deutsche Bank group:

 4 persons are directors or board members in four banks: {{ (α) Deutsche Bank . . . . . . all 4 (β) Essener Kredit-Anstalt . . 2 of them (γ) Essener Bank-Verein . . 2 ” ” (δ) Bergisch-Märkische Bank 2 ” ”

Mines within this bank’s “sphere of influence”:

 20 mines— 66,233 workers; 18.6 mill. tons (1907) || 72,594 ” ; 19.3 ” ” (1910) ||

2) Dresdner Bank and Schaaffhausenscher Bankverein group:

 9 persons are directors or board members in both banks. This group controls: 7 mines— 23,269 workers —5.98 mill. tons (1907) || 27,963 ” —7.2 ” ” (1910) ||
 [BOX:] Mines? “Werke” or “Zechen” Magnates of capital Chief banks Firms, no. of mines, etc. 1910 Workers (000) Tons (mill.) 4 persons—“personal union” of 4 banks Deutsche Bank +3 other banks (Deutscher Bank-konzern) (20 mines) α 72.6 19.3 Haniel Private property and mine Gute Hoffnungshütte (2 mines) γ 35.1 9.9 Kirdorf Discontogesell-schaft Gelsenkirchener Bank Aktiengesellschaft δ (1) 34.4 8.5 Stinnes Discontogesellschaft Private property and Deutsch-Luxemburger δ (2) 34.6 9.1 Berliner Handelsgesellschaft Harpener Bank Aktiengesellschaft ε (1) 25.9 7.1 9 persons—“personal union” Dresdner Bank, Schaaffhausenscher Bankverein Dresdner-Schaaffhausener Banken β (7) 28.0 7.2 Berliner Handelsgesellschaft Hibernia Aktiengesellschaft ε (1) 18.3 5.4 Thyssen γ (1) 16.2 3.9 Krupp γ (1) 12.2 3.1 Fisk (1) 11.1 2.3 Σ = 288.5 75.9 Total in Ruhr area 354.2 89.3 % of these firms 81.5 85
 No. of mines Workers (000) Mill. tons &alpha) 20 72.6 19.3 Deutsche Bank &beta) 7 28.0 7.2 Dresdner Bank + Schaaffhaiisenscher Bankverein γ) 4 63.5 16.9 3 magnates δ) 3 69.0 17.6 Discontogesellschaft ε) 2 44.2 12.5 Berliner Handelsgesellschaft Fisk) 1 11.1 2.3

“In the Ruhr mining industry the interests, of the whole nation come into conflict with the interests of a quite insignificant number of capitalists, who number hardly one hundred” (p. 144).

[[BOX-ENDS: Incidentally, this article deals with the question of whether or not the syndicate will be renewed. Consult Conrad’s chronicle for this period (October-December 1912, etc.). ]]

### MEYER (CAPITAL INVESTMENT) AND SOURCE REFERENCES

Literature

|| __

Dr. A. Meyer, business editor of the Neue Zürcher Zeitung. Capital Investment (Zurich, 1912).

Written by a “practician”: advice to capitalists.

Statistics of company profits, pp. 130–32.

In Britain, 38,928 companies were formed from 1893 to 1902. Of these, 14,538=37 per cent had to go into liquidation!! In France the number of companies forced into liquidation was about 10 per cent (Leroy-Beaulieu).

To be noted from the literature:

Wilhelm Gehrden, The Secret of Success on the Stock Exchange, Berlin. (no date?)

[[BOX-ENDS: a German private speculator, who describes his “personal experience”, p. 139: “a very minute number” win on the stock exchange.

p. 149: one in fifty cases of winning in deals on margin. ((Abundant examples of swindling, etc., etc.)) ]]

Africanus, Cold-Mining Shares as Capital Investment, Leipzig, 2nd edition, 1911.

W. Ruppel, Business in Mining Shares, Jena, 1909.

René Nouel, Joint-Stock Companies, Paris, 1911.

? J. Steiger, Trusts and Cartels Abroad and in Switzerland, Zurich.

H. Albert, The Historical Development of the Interest Rate in Germany, 1895–1908.

Curle, The Gold Mines of the World, London, 1902.

Gumpel, Speculation in Gold-Mining Shares (Freiburg, 1903).

Th. Huber, How to Read a Balance-Sheet (Stuttgart, 1910).

Robert Stern, The Commercial Balance-Sheet (Leipzig, 1907).

H. Brosius, The Balance-Sheet (Leipzig, 1906).

### LIEFMANN ON THE FRANKFURT METAL TRADE

Robert Liefmann, “The International Organisation of the Frankfurt Metal Trade”. Weltwirtschaftliches Archiv, Vol. I. Jena, 1913, p. 108 et seq.

The Merton concern grew out of the enterprises of Merton (Anglo-German family).

|| “Probably more than 200 million marks have been invested in the Merton concern as a whole, not counting, of course, the private property of the capitalists behind it” (p. 121).

“Through its enterprises, particularly those of the Merton concern, the Frankfurt metal trade which, incidentally, includes also some other firms of considerable importance, embraces, therefore, virtually the whole world” (p. 122).

Diagram (p. 120) (town names added): [see p. 37 —Ed.]

Trading capital (of Merton) has passed here into productive capital.

“The characteristic feature of modern wholesale trade in almost all its branches is its penetration into production” (p. 111).

### IMAGE FROM PAGE 37 GOES HERE

Arrows indicate the direction of control OVAL: Metallbank und Metallurgische Gesellschaft 40 mill. marks. Frankfurt OVAL: Schweizerische Gesellschaft für Metallwerte. 20+18 mill. francs. Switzerland BROKEN OVAL: Cuivres et Pyrites Société Anonyme 20 mill. francs. Paris RECTANGLE: Australian Metal Company Australia RECTANGLE: Henry R. Merton & Co. Ltd. £700,000 London RECTANGLE: Metallgesellschaft 18 mill. marks Frankfurt RECTANGLE: American Metal Company $3,000,000 RECTANGLE: African Metal Company Africa OVAL: Merton Metallurgical Company £1,000,000 OVAL: Compagnie des Minérals 2.5 mill. francs Belgium OVAL: Société Auxiliaire des Mines 5 mill. francs Paris OVAL: American Metallurgical Company$2,000,000 OVAL: Compania de Minerales y Metales Mexico

After the electrical industry (Allgemeine Elektrizitäts Gesellschaft in Germany, the General Electric Company in the U.S.A., etc.), probably “the most international branch of enterprise in Germany” (109) is the trade in metals (especially copper, zinc, lead, and rare metals—the chief centre of which is Frankfurt).

The present head, Dr. Wilhelm Merton (member of the board of most of the companies), is in Frankfurt. His father, Henry R. Merton, is in London.

The chief difference between all these companies and other similar ones is that the capitalists at the head of the business still have a direct (p. 119) part in all trading and production enterprises. They “supplement” their capital by capital from the public.

Of course, the number of “companies” in which they have “holdings” is immeasurably greater than shown in the diagram.

### BOURGEOIS SCIENTISTS ON THE STRUGGLE AGAINST IMPERIALISM

N.B. Bourgeois scientists on the struggle against imperialism.

“Nationalities and subject races.”

Report of the conference held in the Caxton Hall, Westminster, June 28–30, 1910. London, 1911 (xii + 178 pp.).

Review in Weltwirtschaftliches Archiv, Vol. II, p. 193, signed H. J. Nieboer (Hague). The author of the review notes that the report contains brief speeches by representatives “of various peoples living under foreign rule: Egyptians, Indians, Moroccans, Georgians, Negro races of Africa, South American Indians, and also European nations such as the Irish and Poles” (p. 194).

|| “We are told that we must fight imperialism; that the ruling states should recognise the right of subject peoples to independence; that an international tribunal should supervise the fulfilment of treaties concluded between the Great Powers and weak nations.

N.B. | They do not go further than expressing these pious wishes. We see no trace of understanding of the fact NB. || that imperialism is inseparably bound up with capitalism in its present form and that, therefore, an !! || open struggle against imperialism would be hopeless. unless, perhaps, it is confined to protests against N.B. certain of its especially abhorrent excesses” (p. 195).[3] || N.B. !!

It is significant that the bourgeois “imperialists” in Weltwirtschaftliches Archiv keep track of the national liberation movements in the colonies (at least the non-German ones).[4]

For instance, Vol. III, 2

the ferment and protests in India (p. 230)

idem in Natal (Africa) owing to restrictions on the immigration of Indians (230–31).

Vol. IV, 1, p. 130—the movement for self-government in the Dutch Indies.[5]

### MORIDE, “MULTIPLE STORES”

Pierre Moride, “Multiple-Store Firms in France and Abroad”, Paris, 1913 (Alcan). (Review in Weltwirtschaftliches Archiv, IV, 1, p. 286.)

Britain Germany Branches 497 firms with 20,644 14,453 ” ” 34,464 (of which 31,799 are shops or larger stores) No. of employees 926,369——— 473,077 France . . . . . . 12,000 50,000 manual and non-manual employees 125 million francs wages.

———“a manifestation of the process of concentration which is seen in trade as well as in manufacturing industry” (p. 286).

### SOURCE REFERENCES

in the Museum Society

N.B. The Edinburgh Review

1915, October:

“The Workshops and the War.”

[A very interesting article on the attitude of the working class to the war and its economic effects (improved position of the workers, less unemployment, etc.).]

The Atlantic Monthly, 1916, apparently June. White, “The Different World After the War”.

N.B. Schmoller’s Jahrbuch, 37th year. Marx on statistics of bond issues in Germany and abroad.

? Albin Geyer, Jahrbuch der Weltgeschichte. 1913—14th year. Leipzig, 1914. (Karl Prochaska’s Illustrierte Jahrbücher.)

[Supposed to be terse surveys of the year, rather than a collection of documents or handbook.]

[Ch. K.] Hobson, The Export of Capital, London, 1914.

[J. A. Hobson], Imperialism.

The South-African War.

Ballod, Fundamentals of Statistics, Berlin, 1913.

Ischchanian, National Composition etc. of the Caucasian Peoples, 1914 (81 pp.).

Taylor (German edition, 1914).

Dietrich, Factory Management.

Ely, Monopolies and Trusts.

Jenks. Published in Schmoller’s Jahrbuch or some other economic journal. Conrad’s Jahrbücher für National-ökonomie und Statistik. ((Third series, Vol. I.))

Harms.

Agahd, Big Banks and the World Market, 1914.

Riesser, Big Banks, 1906.

Macrosty, Trusts, 1910.

Shadwell, Britain, Germany and America, Berlin, 1908.

Jeidels, Relation of the Big Banks to Industry. Schmoller’s Forschungen, Vol. 24, Leipzig, 1905.

Schilder.

Levy, Monopolies and Trusts.

Tschierschky.

Liefmann, Cartels and Trusts.

Vogelstein, Capitalist Forms of Organisation.

### SCHILDER, VOLUME 5 OF WELTWIRTSCHAFTLICHES ARCHIV

Sigmund Schilder. “World-Economic Background of the World War”. Weltwirtschaftliches Archly. Vol. 5 (I) (pp. 1–22).

A very good outline (Germanophile, of course).

The transition of other countries to protectionism caused

Britain in the 19th—20th century to pass to plans for war.

Austria. Her Balkan aspirations.

Interesting to note: in Serbia(at the time of the annexation of Bosnia and Herzegovina) in 1908–09 there were voices in favour of war with Austria-Hungary on the following grounds. If we win, we shall | !! take the Serbs away from Austria-Hungary. If we are defeated, Serbia will be included in the customs | N.B frontier of Austria-Hungary. That would suit us too. We have nothing to lose (p. 11).

For Russia > “first and foremost” “the private economic advantage of the military-bureaucratic ruling class” (12). Exception: the drive for the Dardanelles.

In France dissatisfaction over the Morocco-Congo agreement of November 4, 1911.

Belgium can retain her Congo only with the help of Britain; the agreement of February 5, 1895 gave || N.B. France “first option” to the purchase of the Congo (p. 16).

Japan aims at domination over China.

Turkey prior to 1913 was “an object rather than a subject of world politics” (19).

Portugal is dependent on Britain.

Spain (by the November 27, 1912 treaty with France) obtained a northern portion of Morocco (France was against, Britain was in favour). Spain has gone a long way in the 16 years, 1898–1914.

### NOTES FROM NASHE SLOVO

Nashe Slovo No. 11 (February 10, 1915).

N.B. // Zaleweki’s article “Concerning the National Question”. In favour of § 9.[6] He quotes from Iskra No. 44:

| ...“However, our unreserved recognition of the struggle for freedom of self-determination does not in any way commit us to supporting every demand for national self-determination. As the party of the proletariat, the Social-Democratic Party considers it to be its positive and principal task to further the self-determination of the proletariat in each nationality rather than that of peoples or nations.”[7] No. 82 (May 6, 1915). Leading article: “Imperialism and the National Idea”.

(( against Hervé. “The bare national idea is reactionary.” The twentieth century = the century of imperialism; the nineteenth century, that of nationalism. ))

 {{ No. 116 (June 17, 1915) “K. Kautsky on Plekhanov” and No. 117 (June 18, 1915) (from a Bulgarian magazine) and No. 118 (June 19), No. 130 (July 3, 1915) “The Nation and the Economy” by N. Trotsky+No. 135 (July 9). {{ No. 170 (( August 21, 1915 )) L. Martov against Sotsial- and 171 August 22, 1915 -Demokrat (on defeat). 172 (August 24, 1915) No. 192 (September 16, 1915) Martynov on “TheUnited States of Europe”. No. 209 (October 8, 1915) N. Trotsky on Zimmerwald.

### SOURCE REFERENCES

From the Cantonal Library (Zurich).

N.B. Atlanticus, Production and Consumption in the Social State, 1898. Preface by Kautsky.

Henry Demarest Lloyd, Wealth against Commonwealth, New York, 1901.

? Statistisches Jahrbuch für das Deutsche Reich (1915).

Stillich, Economic Studies in Big Industrial Enterprise. Vols. I and II. 1904 and 1906.

Bulletin de l’institut international de statistique (Vols. 1—19).

Clark, The Labour Movement in Australasia, 1906.

André Liesse, The Social Question, Paris, 1895.

Grunzel, Cartels, 1902.

Baumgarten and Meszleny, Cartels, 1906.

Juraschek, Surveys of World Economy.

Neumann-Spallart, Surveys, 1879–80... 1883–84 editions.

Quaintance, The Influence of Farm Machinery on Production and Labour, 1904. (Thesis.)

J. Plenge, From Discount Policy to Domination of the Money Market, 1913.

Schulze-Gaevernitz, British Imperialism, 1906.

? Emil Brezigar, Harbingers of Economic Crisis in Germany, Berlin, 1913 (1.80 marks).

Prognosis of the 1913–14 crisis.

Bernhard Mehrens, Origin and Development of the Big French Credit Institutions, 1911.

Lysis, Against the Financial Oligarchy in France, 1908.

André Liesse, Portraits of Financiers, 1909.

Testis, The Truth about Lysis’s Proposals, 1908.

Edm. Théry, Economic Progress in France.

|| Pierre Baudin, The Economic Boom.

[DITTO: || ] Maurice Schwob, Before the Battle (The Trade War), Paris, 1904.

R. Claus, Russian Banks, 1908. (Schmoller’s Forschungen, Number 131.)

Dr. Mentor Bouniatian, Economic Crises and Over capitalisation, Munich, 1908.

Edm. Théry, Europe and the United States. General Statistics, Paris, 1899.

Keltie, The Partition of Africa, 1895.

N.B.: 0. Schwarz, Financial Systems of the Great Powers. (Series of Göschen publications.) Two vols. Leipzig, 1909.

N.B. | [Interesting tables on the development from the seventies to 1900. N.B.]

Principles of Social Economics, Tübingen, 1914 et seq.

### TOTAL CAPITAL IN JOINT-STOCK COMPANIES

What amounts do “they” control?

Bank-Archiv, XIIIth year. June 15, 1914.

“German joint-stock company reports, 1907–8—1911–12”....

1911–12...Number of joint-stock companies . . . . . . . . . .4,712
their share capital . . . . . .14,880 mill. marks
actual reserves . . . . . . .3,515 ” ”
income . . . . . . . . .1,470 ” ”
Number of companies paying dividends . . . . . . . .3,481
Total dividend . . . . . . .1,220 mill. marks=8.39%
!! |||Growth of capital:
 from 1907 to 1912 (5 years) = +2,766 mill. marks nominal +3,346 ” ” at market value __ __ __ above nominal +579 ” ” (!!)

### KESTNER, COMPULSORY ORGANISATION

Dr. Fritz Kestner, Compulsory Organisation.

A Study of the Struggle between Cartels and Outsiders, Berlin, 1912.

A systematic study of conflicts between cartels and “outsiders” and within cartels—and methods of “struggle”:

1. 1) Stopping supply of raw materials....
2. 2) Stopping supply of labour by means of alliances....
3. 3) Stopping deliveries....
5. 5) Binding purchasers by exclusive agreements.
6. 6) Systematic price cutting.
7. 7) Stopping credit....
8. 8) Boycott.[8]

[From Inquiry into Cartels (5 vols. 1903–06) and others.]

A host of examples. Very detailed examination of the state and legal significance....

“The Rhine-Westphalian Coal Syndicate, at its foundation in 1893, concentrated 86.7 per cent of the Rhine-Westphalian coal output ... in 1910—95.4 per cent (p. 11)....[9] The United States Steel Trust in 1911—45 per cent of the output of pig-iron”.... (Other examples: 98 per cent—85 per cent, and so on.)

“The entry of a particular enterprise into a cartel is a business act decided by considerations of profit. Like the operation of cartels in general, its implications are felt mainly in periods of depression. Conflicts between cartels and outsiders arise chiefly because of the differing impact restriction of trade outlets, the inevitable result of the cartel activity, has on individual enterprises. Restriction of trade outlets has a particularly severe impact on enterprises capable of expansion, which is why their resistance is the strongest” (pp. 25–26)....

...“The difference between the two concepts” (cartel and trust) “is really one of ownership: various owners in the cartel, only one in the trust” (p. 53 and a reference to Liefmann).

“It has been repeatedly established—and this can be regarded as a general phenomenon—that the profitability resulting from cartelisation attracts new entrepreneurs and new capital into the industry” (57). For example, the Potassium Syndicate raised prices. Result:

 in 1879 there were 4 enterprises ” 1898 ” ” 13 ” ” 1909 ” ” 52 (p. 57)

[[ARC-ARROW BETWEEN LAST AND LAST-2 PARAGRAPHS.]] Provisions concerning higher prices for outsiders sometimes take the form of lower discounts for them (p. 73)....

The Buchhändler Börsenverein—forbade the sale of books “to dealers selling at bargain prices” (84).

“Stopping the supply of materials, along with binding purchasers by means of exclusive agreements, which will be dealt with below, must be regarded as one of the most important means of compelling entry into the cartel” (91)....

...Export subsidies... (107).

“dependent traders’ organisations are set up” (109)... (coal—paraffin....)

Price cutting.... There were cases of benzine prices being reduced from 40 to 20–22 marks (118)—of alcohol in Upper Silesia to 49.5 marks (in Breslau the price is 62.2 marks)....

Credit refusal: Phoenix declined to join the Federation of Steel Plants. The director of the firm was against joining. The banks bought up its shares—withdrew its export subsidies—and secured a vote in favour of joining at a meeting of shareholders!! (pp. 124–25).

Agreements with members within the cartel .... (penalties; arbitration courts instead of general courts)....

The best means of control—“joint sales office” (153)....

“Jeidels (p. 87 of his book) is undoubtedly right that the foundation of a new big independent bank in Germany would be impossible” (p. 168).

“Even in the purely economic sphere a certain change is taking place from commercial activity in the old sense of the word towards organisational-speculative activity. The greatest success no longer goes to the merchant whose technical and commercial experience enables him best of all to estimate the needs of the buyer, and who is able to discover and, so to speak, ‘awaken’ a latent demand; it goes to the speculative genius who knows how to estimate, or even only to sense in advance, the organisational development and the possibilities of certain connections between individual enterprises and the banks...” (p. 241).[10]

| “The heads of the big firms are able at any time to enlist the services of the most learned and skilful lawyers, and if they themselves are not highly versed in commercial matters, they can enlist the aid of outstanding businessmen. It is common knowledge that the central offices of big enterprises employ a whole number of persons who have no relation to | !! the undertaking as such, including even a doctor of political economy for economic propaganda on behalf of the firm” (p. 242).

||| N.B. The formation of cartels—and this has been established in the case of those formed so far—leads to an alteration of prices, and also incomes, in favour of heavy or raw-materials industry and to the detriment of manufacturing industry. The prolonged raising of prices which results from the formation of cartels has hitherto been observed only in respect of the N.B. most important means of production, particularly coal, iron and potassium, but never in respect of manufactured goods. Similarly, the increase in profits I resulting from this raising of prices has been limited only to the industries which produce means of production. To this observation we must add that the industries which process raw materials (and not semi-manufactures) not only secure advantages from the cartel formation in the shape of high profits, to the detriment of the finished goods industry, but have also secured a dominating position over the latter, which did not exist under free competition” (p. 254).[11]

Cartels, says Kestner, do not always lead to concentration (they may “rescue” small establishments joining the cartel), but the cartel always leads to “intensification of capital” (274) ... to an enhanced role of rich, big-capital enterprises (272 and 274).

Regarding the importance of cartels one should not overlook, Kestner says, the difference between an organisation, say, of consumers (this is socialism, p. 282), and an organisation of manufacturing or raw-materials industries.

“The present situation, the dependence of a much bigger section of industry on the output of raw materials, has a certain superficial resemblance to it [to a union of consumers, etc.][12] but internally it is the exact opposite” (p. 282). ((Liefmann, he says, constantly overlooks this difference—note, p. 282.))

“It is a matter of dispute whether cartels have led to an improvement of the workers’ position, as is asserted by some and contested by others, and whether they embody a co-operative democratic principle” ((Tschierschky!! The author rejects that view: note, p. 285)), “or whether they indicate, precisely in the case of Germany, an anti-democratic attitude, owing to the shift to heavy industry which is hostile to the trade unions” (285)....

### VIENNA ARBEITER-ZEITUNG ON VIENNESE BANKS

Vienna Arbeiter-Zeitung, 1916 (April 11, 1916), No. 101.

Figures on banks (eight big banks: Kreditanstalt; Union-bank; Verkehrsbank; Eskomptegesellschaft; Bankverein; Bodenkreditanstalt; Merkur + Allgemeine Depositenbank).

 Capital— 657.4 mill. kronen Reserves— 383.2 ” ” __ __ __ 1,040.6 Borrowed money 4,833.8 ” ” Net profit __ __ __ 81.4 ” ” Increase of deposits compared with 1914 1,067.9

### ANNALS OF THE AMERICAN ACADEMY

The Annals of the American Academy of Political and Social Science, Vol. LVII–LIX (1915).

[BOX:]

(Consists of separate booklets + bibliography, etc. Vol. LIX (1915. May): The American Industrial Opportunity. A collection of articles.)

[BOX:]

Total wages in the U.S.A.[13]

1/10—$1,000 and > (p. 115) 2/10—$750-1,000

7/10—< $750 Includes an article by William S. Kies, “Branch Banks and Our Foreign Trade” (p. 301). “Forty English banks operating in foreign countries If have 1,325 branches; in South America five German banks have forty branches and five English banks have seventy branches.... England and Germany have put into Argentina, Brazil, and Uruguay, in the last twenty-five years, approximately 4,000 million dollars, and as a result enjoy together 46 per cent of the total trade of these three countries.”[14] ((and further on New York’s aspirations and attempts to replace them....)) [[BOX: A special examination of the “opportunity” for the U.S.A. to take advantage of the war to increase its trade, etc. with South America. | N.B. ]] || 200,000 million francs. 40,000 million dollars {{ =160,000 million marks }} [[BOX: cf p. 2 here//***/ See pp. 66–67 of this volume.—Ed. \\***\\ ]] p. 331 (in another article).... “Sir George Paish in the last annual of The Statist estimated that upwards of 40,000 million dollars of the capital had been supplied to the less developed countries by the five lending nations of the world, Great Britain, Germany, France, Belgium and Holland”....[15] || In another article on “South American Markets”: “Another fundamental proposition—and the most important of all in increasing trade with South America—is the investment of capital from the United States in loans and in construction and similar enterprises. The country whose capital is invested in a ||| N.B. South American country is going to get the most of the contracts for materials used in construction enterprises, railway building, and the like, as well as the contracts for public improvements carried on by the governments. England’s investments in Argentine railways, banks and loans are the living evidence of this fact” (314).... 110 corporations own capital = 7,300 million dollars, number of shareholders = 620,984. Figures for 1910 given, inter alia, in “Stocks and Stock Market”. Total American stocks = 34,500 million dollars (but without overlapping approximately) = 24,400 million dollars, and total wealth = 107,100 million dollars. ### SOURCE REFERENCES From the Lausanne catalogue (Lausanne Cantonal Library). Continuation 1902. Deschanel, The People and the Bourgeoisie, Paris, 1881. Godin, The Republic of Labour and Parliamentary Reform. Paris, 1889. L. Lallemand, Revolution and the Poor, Paris, 1898. Ch. Renault, History of Strikes, Paris, 1887. Eug. Schuyler, American Diplomacy, New York, 1886. Jooris, The Dutch Colonies. Liège, 1883. Th. Rogers, History of Prices, 6 vols. Mulhall, “History of Prices since 1850”, London, 1885. War on War. (Symposium.) Inagaki, Japan and the Pacific, 1890. Swift, Imperialism and Liberty, Los Angeles, 1899. Viallate, Political Life of the Old and New World, VIIth year (1912–13) and preceding years. Paul Feyel, Political History of the Nineteenth Century, Paris, 1914. 2 vols. Camille Vallaux, The Earth and the State (Social Geography), Paris, 1911. Lecarpentier, International Trade, Paris, 1908. Maritime Trade and the Mercantile Marine. Paris, 1910. Martin S.-Léon, Cartels and Trusts, Paris, 1909. Chisholm, Handbook of Commercial Geography, London, 1911. Eckert, Outline of Commercial Geography, 2 vols., Leipzig, 1905. Reichlen, Franco-German Rivalry in Switzerland, 1908 [also available in Berne?]. Raffalowitsch, The Money Market, 1911–12 ((21st year)). Van der Lecuw, Aspirations for World Peace, 1916, Rotterdam, 1915. Commission. Indian Plague (1889–1900). Vols. 4 and 5. Conclusion. Avenel, Peasants and Workers in the Last 700 Years, Paris, 1907. The Rich in the Last 700 Years, Paris, 1909. Fabre, Asiatic Competition (and the European workers), Paris, Nîmes, 1896. Langhard, The Anarchist Movement in Switzerland, Berlin, 1903. From recent literature: Ergang, “Ousting of the Worker by the Machine”. Technik und Wirtschaft. 4th publication year, No. 10. Kammerer, “Trends in the Development of Technics”. Ibid., 3rd year.+Schriften des Vereins für Sozial-politik, Vol. 132. Grunzel, The Triumph of Industrialism, 1911. Rathenau: see p. 32.[16] Ergang, The Problem of Machines in Economic Science, 1911. Mannstaedt, Capitalist Use of Machinery, 1905. A. Riedler, The Historical and Future Significance of Technics, Berlin, 1910. Öchelhäuser, Technical Operation, Past and Present, Berlin, 1906. E. Reyer, Power. Economic, Technical, etc., Studies in the Growth of the Might of States, Leipzig, 1908. Neuhaus, “Technical Prerequisites of Mass Production”. Technik und Wirtschaft, 1910 (3rd year). M. Gras, Machinism, Paris, 1911. Van Miethe, Technics of the Twentieth Century, 1911–12. F. Mataré, Instruments of Labour: the Machine, etc., 1913. Levasseur, Comparison of Hand Labour and Machine Labour, 1900 ### STILLICH, MONEY AND BANKING Dr. Oskar Stillich, Money and Banking, Berlin, 1907. A super-popular piece. a Proudhonist fool and banker against money ||| p. 95. Banker Julius Hucke, The Money Problem and the Social Question (5th edition), 1903. p. 143: “No banking operation brings in such high profit as the issue of securities.”[17] Profits from the issue of securities are higher than anywhere else.... There have been attempts to justify profits from the issue of industrial shares by pleading expenses and anticipated higher returns, but in reality this is economically unearned profit, and according to the Deutsche Oekonomist it amounts, on an average:  N.B. || 1895— 38.6% N.B. || idem more fully in Sombart, The GermanNational Economy inthe Nineteenth Century(2nd edition, 1909), p. 526, appendix 8 1896— 36.1% 1897— 66.7% 1898— 67.7% 1899— 66.9% 1900— 55.2% N.B. “In the ten years, from 1891 to 1900, more than a thousand million marks were ‘earned’ by issuing German industrial stock.”[18] p. 138. “Reconstructions”.... “Shares are amalgamated and their nominal value decreased. A classic example of such writing down of share capital is the Dortmund Union founded by the Discontogesellschaft. N.B. ||| In the first volume of my Economic Studies in Big Industrial Enterprise (Leipzig, 1904), I examined in detail the financial history of the unfortunate offspring of this bank. In ||| good example !!! the course of thirty years, more than 73,000,000 marks were written off the books of the Union by a series of operations decreasing the nominal value of shares. ||| !!! At the present time the original shareholders of the company possess only 5 per cent of the nominal value of their shares”!! (138)[19] Current Accounts—a means of exerting influence on industry. “How great the banks’ influence over their clients is shown, for example, by the following letter, reproduced from the Kuxen-zeitung, sent on November 19, 1901 by the Dresdner Bank to the Board of the German North-West Cement Syndicate. || good example!! The letter states: “As we learn from the notice you published in the newspaper Reichsanzeiger of November 18, we must reckon with the possibility that the next general meeting of your syndicate, to be held on the 30th of this month, ||| !! may decide on measures which are likely to effect changes in your enterprise which are unacceptable to us. We deeply regret that, for these reasons, we are obliged henceforth to withdraw the credit which has hitherto been allowed you. Accordingly, we ask you to cease requests for money from our bank and at the same time we respect fully ask you to return not later than the end of the current month the sums owing to us. But if the said next general meeting does not decide upon measures which are unacceptable to us, and if we receive suitable s on this matter for the future, we shall he quite willing to open negotiations with you on the grant of a new credit”[20] (146–47). good example | !!! ||| ...“The daily occupation of a number of employees in our big banks consists solely of calculating the interest on current accounts. !! ||| In the course of time they achieve real virtuosity in this matter.... They are an example of how capital suppresses personality and turns the individual into a machine” (148).... N.B. || “‘Every bank is a Stock Exchange’, and the bigger the bank, and the more successful the concentration of banking, the truer does this modern aphorism ring” (169).[21] ha-ha!! (cf. K. Kautsky) |||| “Through their subsidiary banks the Pereires” (founders of Crédit Mobilier) “wanted to entangle various nations financially and in this way promote world peace” (180).... “Spheres of operation” “for bank capital” in the seventies—German railways (nationalised at the close of the seventies) in the eighties—Rhine-Westphalian heavy industry in the nineties—electrical industry (and engineering). attitude to employees || “In 1906 the four Berlin “D” banks (Deutsche Bank, Discontogesellschaft, Dresdner Bank, Darmstädter Bank) concluded an agreement not to engage an employee of any of these banks who had not been freed from his post!” (203). The opposition of the employees compelled a “substantial” (??) “modification” (??) of this agreement ((in what respect? how????)). End N.B.: H. Withers, Money and Credit in England, 1911. Philippovich Sombart Principles of Social Economics (Bücher, Schulze-Gaevernitz, etc., etc.). ### LIEFMANN, CARTELS AND TRUSTS Professor Dr. R. Liefmann, Cartels and Trusts and the Further Development of Economic Organisation, 2nd edition, Stuttgart, 1910. Library of Jurisprudence and Political Science. [[DOUBLE OPEN LEFT BOX END: A popular book giving a good outline of the subject matter. The standpoint is that of a dull-witted, smug, complacent bourgeois apologist. ]] The facts are not badly selected but, of course, apologetically. N.B.: p. 161: “In Germany there have been a very large number of mergers that are not (???) of a monopolistic nature.... A typical example—not to cite numerous instances from a more remote period—is the gunpowder industry. Already in the seven ties, 19 gunpowder factories merged in a single joint-stock company. In 1890, this merged with its most powerful rival to form the Vereinigte Köln-Rottweiler Pulverfabriken. This big joint-stock company then formed cartels not only with other gunpowder factories, but also with the dynamite trust mentioned above. Thus there was formed quite a modern amalgamation of all the German explosives factories, which, together with the similarly organised ||| division of the world || French and American explosives factories, have of the divided the whole world among themselves, so to speak” (p. 161).[22] The number of industrial cartels in Germany (1905) was 3 8 5 (in reality more: p.25).[23] N.B. |||| Riesser (p. 137), in quoting these statistics, adds: “about 12,000 firms participated ‘directly’ in these cartels”. Riesser, The German Big Banks and Their Concentration, 3rd edition, Jena, 1910. The number of international cartels (with German participation) is about 100 (p. 30: in 1897 it was about 40).[24]  First cartel 1879: 4 firms Prices rise 1898: 10 firms “Potassium fever”: 1901–21firms 1909—52 (“Some collapsed”) The Steel Trust in America (1908: 165,211 workers) 1907—210,180 workers (total wages—$161 million), net profit—$170 million, capital—$1,100 million (p. 124).

In 1908, the biggest firm in the German mining industry, Gelsenkirchner Bergwerksgesellschaft, had 1,705 employees + 44,343 workers (wages—70.5 million marks).

(p. 135). In 1902 (June 17, 1902) Schwab founded the Shipbuilding Company, capital $70.9 million—of which Schwab had$20 million. Later this company went bankrapt; the public were robbed!

(173, etc.) “Interlocking”, “holdings” (passim), “abolishing isolation” (p. 155)—these are Liefmann’s “catch-words” for avoiding (and obscuring) Marx’s concept of “socialisation”.[25]

((End of extracts from Liefmann))

### FROM PRINCIPLES OF SOCIAL ECONOMICS

Principles of Social Economics, by S. Altmann...

K. Bücher and many others.

Section V, Part II: “Banking” (Schulze-Gaevernitz and Jaffé), Tübingen, 1915.

1. I. Schulze-Gaevernitz, “The German Credit Bank” (1–190).
2. II. Edgar Jaffé, “Anglo-American and French Banking” (191–231). (More like a textbook, by paragraphs, apparently mostly chatter and “systematics”.)

[[TRIPLE BOX ENDS: There is also interesting material. The spirit of “imperialismthroughout. ]]

p. 53: in 1914 eight Berlin big banks owned

 share capital— 1,245 mill. marks including Deutsche Bank 250 Discontogesellschaft 300 Dresdner Bank 200 reserves . . . . . . . . . . . 432 1,677 borrowed money . . . . . . . . 5,328 (“total capital”) . . . . . . . . 7,005

p. 140: Specialisation: “Money and Credit Operations”.

18821907
Establishments . . . . . . . . . .5,87913,971
Persons employed . . . . . . . . .21,63366,275
(of whom women) . . . . . . .2443,089
in 1907 there were 3 establishments with >1,000employees
Dresdner Bank ” 1912 ” . . . . .4,638

cf. p. 11: there were 14,000 banking houses in Germany in 1907, of which 4,000 were auxiliary establishments....

p. 145: ... “The big banks have become the most important means for the economic unification of the German Reich”....

|||| “a dozen persons” “Once the supreme management of the German banks has been entrusted to the hands of a dozen persons, their activity is even today more significant for the public good than that of the majority of Ministers of State” (145–46).[26]

ha-ha!! ||| “If, however, this is so, then the national welfare requires the development of a new spiritual type of bank magnate whose abstract [ha-ha!] urge for profit is permeated by national-political and therefore national-economic considerations....

“If we imagine the development of those tendencies we have noted carried to their logical conclusions we will have: the money capital of the nation united in the banks; the banks themselves combined into cartels; the investment capital of the nation cast in the shape of securities. Then the forecast of that Saint-Simon | genius Saint-Simon will be fulfilled: ‘The present anarchy of production, which corresponds to the fact that economic relations are developing without uniform regulation, must make way for organisation in production. Production will no longer be directed by isolated manufacturers, independent of each other and ignorant of man’s economic needs; that will be done by a certain public institution. A central committee of management, being able to survey the large field of social economy from a more elevated point of view, will regulate it for the benefit of the whole of society, will put the means of production into suitable hands, and above all will take care that there be constant harmony between production and consumption. Institutions already exist which have assumed as part of their functions a certain organisation of economic labour, the banks.’ what Marxism!!! ||| We are still a long way from the fulfilment of Saint-Simon’s forecast, but we are on the way towards it: Marxism, different from what Marx imagined, but different only in form!” (146)[27]

| good example! (envy) 4 and 30 “Of course, investments like those made by Britain, e.g., in the Suez Canal, on the basis of her political power—the shares were bought in 1876 for £4 million and today are worth £30 million—are still unattainable for Germany”...(159–60).

p. 164 quotes J. Lewin, German Capital in Russia, St. Petersburg, 1914

.|| N.B. “The economic function of the banks is the already much discussed management of the national property [a reference to Lansburgh’s article in the magazine Die Bank, 1908]. Today, the greater the development of credit operations, the greater becomes the share of the total capital going to entrepreneurs chosen by the bank. The banks now provide the channels through which flow not only annual savings but also previously accumulated (and continually renewed) capital. One recalls, above all, the enormous growth of ‘borrowed money’. In our joint-stock banks in Germany these deposits amounted |||| N.B. |||| 10,000 million to about 1,280 million marks at the end of 1891; to about 6,305 million marks at the end of 1906; at the present time they are estimated at approximately 10,000 million marks.

|||| 5,000 million “At the end of 1913, deposits of the nine big Berlin banks alone were about 5,100 million marks.[28] At the same time, however, the banks act as channels for still larger movements of capital in dealings in stock. In this matter, even if there is good will, they may make mistakes; they may direct thousands of millions into the wrong channel and, N.B. ||| under certain circumstances, lose. At the present time a few big banks can to a certain extent determine the course of our economic development. Hence their economic responsibility to the shareholders becomes a national economic responsibility in relation to the state as a whole. They do, in fact, direct capital into industrial and commercial channels, primarily into the giant enterprises N.B. |||| of heavy industry, and also into real estate—formerly into the estates of the nobility but nowadays into the leasehold houses of the big cities. Hence the rapid progress of the German iron industry, which is second only to America, and of the German big cities, which are overtaking even their American prototypes” (p. 12)...

N.B. ||| p. 27: “Borrowed money (of creditors and depositors) at the end of 1908: 8,250 million marks in credit banks, 15,000 million marks in savings banks, 3,000 million marks in credit associations. Σ = 26,250 million marks.

N.B. ||| “‘Private banking houses’ are increasing in number (1892: 2480; 1902: 2,564; 1912: estimated at about 3,500) and decreasing in importance” (p. 16).

Everywhere (passim), throughout, Schulze-Gaevernitz’s tone is that of triumphant German imperialism, of a triumphant swine!!!!

 || Chara- cteristic of a crisis!! || p. 35: 1870 —31 banks with a capital of 376 million marks 1872 —139 ” ” ” ” ” 1,112 ” ” || (1873) —73 banks, the rest with a capital of 432 mill. marks liquidated by the crisis

State Bank endorsement and clearing operations (thousand million marks)

189119011913
||98.7196.6452.8|| N.B.
including turnover of cash payments
24.3 (=24.7%)29.7 (=15.1%)43.4 (=9.6%)

.

.“In 1909, the Bank of France discounted 7,500,000 bills below 100 francs, whereas the German State Bank discounted only 700,000 bills below 100 marks”. (p. 54).

“Democratisation” of banking!![29] Compare the one-pound shares in Great Britain and the minimum of 1,000 marks in Germany (p. 111).[30] The average size of a bill of exchange in Germany = 2,066 marks (State Bank); in France it is 683 francs (Banque de France).

|| N.B. “G. von Siemens declared in the Reichstag on June 7, 1900, that the one-pound share was the basis of British imperialism” (p. 110).[31] || “The British industrial state is based less on credit than the German, and more on its own capital” (55).

“Even today, Great Britain, as the international intermediary for payments, is said to earn about 80 million marks annually as commission on acceptances. It is said that 6,000 million marks are paid annually through Great Britain for the overseas trade of Europe” (83).

p. 100: § entitled “The Banks’ Domination over the Stock Exchanges?”—This is said to be an exaggeration but “their [the banks’] influence is far-reaching”.... ||||| “While formerly, in the seventies, the Stock Exchange, flushed with the exuberance of youth, opened the era of the industrialisation of Germany, taking advantage of the opportunities offered by shares, nowadays the banks and industry are able to ‘manage it alone’. The domination of our big banks over the Stock Exchange, which is bound up with “completely organised”[32] ||| contango business—but not only with this—is nothing else than the expression of the completely organised German industrial state. If the domain of automatically functioning economic laws is thus restricted, and if | the domain of conscious regulation by the banks is considerably enlarged, the national economic responsibility of the few directing individuals is immensely increased” (101).[33]

N.B. || (Quoted) A. Löwenstein, “History of the Württemberg Credit Bank System and Its Relation to Big Industry”... Archiv für Sozialwissenschaft. Supplementary issue No. 5. Tübingen, 1912.

Issues (p. 104):

Internal securitiesMy calculation

Σ:3=

190919101911
Germany with colonies . . . . . . .3.22.52.27.9:3=2.6
Britain with colonies . . . . . . .1.93.11.86.8:3=2.3
France with colonies . . . . . . .1.40.70.62.7:3=0.9
Foreign securitiesMy calculation
190919101911Σ:3=ΣΣ
Germany with colonies . .0.30.50.51.3:3=0.43,000 million marks
Britain with colonies . .1.82.32.06.1:3=2.04,300 million marks
France with colonies . .2.03.83.18.9:3=2.93,800 million marks

Issues in Germany (at market value)

000 million marks
Social credit

(state and mu-

nicipal loans)
Land credit

(mortgages)

Industrial

Internal

securities Total

Foreign

securities Total

[1886-1890]1.81.21.34.32.3
[1891-1895]1.82.20.84.81.5
[1896-190011.71.94.38.22.4
[1901-1905]3.32.32.68.32.1
[1906-1910]6.02.64.812.61.5

The author concludes:

“The statistics of issues very clearly reveal the state-socialist and industrial colouring of the German national economy” (104).

Germany’s “Prussian railway system”, the author says, is “the greatest economic undertaking in the world” (104)....

Joint-Stock Companies in Prussia in 1911

(million marks)
Invested capitalAnnual profit
No. of

companies

Nominal

value

Market

value

%

(market)

Millions of

marks

% of

nominal

value
% of

market

value
177.9%|||8908,82115,696177.995210.8%6.1%|||15,700

– 8,800

6,900 mill.

N.B. || ...“Advocates of the small share emphasise that it enables workers to participate in industry, interlocking the interests of the worker and the employer in a way that is socially and economically desirable. It is profit-sharing in a modern form” (pp. 11O–11)—-(in connection with one-pound shares).

phrase-mongering and lies!! {{{ !! || In the § on “speculation in securities” (p. 111 et seq.), instead of exposing speculation by the banks ((cf. the magazine Die Bank, Eschwege and others)), the scoundrel Schulze-Gaevernitz gets out of it by phrases: “If our banks were speculative companies ... it would mean ... the collapse of the German national economy” (112)... ((“if”))... saves the “propriety” of our “business world”, and our bank officials are forbidden to speculate in alien banks (of course, he says, this can be easily circumvented!! in large cities) ...but what about bank directors? For they are “in the know” (“Wissenden”)!! Here, he says, legislation is of no avail, what is needed is “strengthening of the commercial sense of honour and standing” (113)....

“At the end of 1909, the nine big Berlin banks, together with their affiliated banks, 9 banks 83% of the total!! || controlled 11,300,000,000 marks, that is, about 83 per cent of total German bank capital. The Deutsche Bank, which together with its affiliated banks controls nearly 3,000,000,000 marks, represents, parallel to the Prussian State Railway Administration, the biggest and also the most decentralised accumulation of capital in the Old World” (137)....[34]

Agreements between banks: the Darmstädter Bank wanted to conclude an agreement with the city of Berlin on “revenue-use” of the Tempelhof area, at a 10 per cent profit. towards a bank cartel || Later, when the Deutsche Bank made this deal—the Darmstädter Bank was found to be in its consortium!! (p. 139).... “Bank consortiums of this kind tend to make price agreements”....

(1913) ||| “Nevertheless, the ‘general agreements’ concluded in the summer of 1913 go so far that, after their implementation, there can hardly be any further talk of free competition in banking”... (139)...

25 persons control.... ||| “The Discontogesellschaft, for example, em ploys a permanent staff of 25 to check accounts and the formal aspect of operations” (143).

banks and the army!! || “Army service in Prussia and Germany, with the mass training it provides in disciplined work, performs important preparatory work for big firms, especially the banks. If it were not indispensable already on political grounds, it would have had to be introduced as a preparatory school for big capitalist firms and for raising the intensity of economic activity” (144–45)....

N.B. N.B. ||| “Thirty years ago; businessmen, freely competing against one another, performed nine-tenths of the work connected with their business other than manual labour. At the present time, nine-tenths of this ‘brain work’ is performed by employees. N.B. ||| Banking is in the forefront of this evolution (151).[35] In the gigantic firms, the official is everything, even the director is a ‘servant’ of the institution

...“The Frankfurter Zeitung (May 2, 1914) greeted the fusion of the Discontogesellschaft with the Schaaffhausenscher Bankverein with the following words:

“‘Theconcentration movement of the banks is narrowing the circle of establishments from which it is possible to obtain credits, and is consequently increasing the dependence of big industry upon a small number of banking groups. In view of the close connection between industry and the financial world, the freedom of movement of industrial companies which need banking capital is restricted. For this reason, big industry is N.B. ||| watching the growing trustification of the banks with mixed feelings. Indeed, we have repeatedly seen the beginnings of certain ||| agreements between the individual big banking concerns, which aim at restricting competition’” = (p. 155).[36]

154–55: The question is: who is more dependent on whom, the banks on industry or vice versa?...

Wiewiorowski, The Effect of the Concentration of German Banks on Crisis Phenomena (Freiburg Thesis), Berlin, 1911.

N.B. ||| Völker, Forms of Combination and Interest Sharing in German Big Industry, Leipzig, 1909 ((Schmoller’s Jahrbuch, Vol. 33, No. 4)).

Chapter X. “Foreign Investments.”

N.B. ||| “For our banks to be able to channel the inflow of capital into foreign investments requires definite prerequisites of a private economic nature on the part of their clients. N.B. ||| The chief stimulus is the need for a higher rate of profit than that from investment at home, N.B. ||| where capital wealth is increasing and the rate of interest falling....

N.B. || “...The banks therefore aim primarily at stock issues, which usually yield higher profits in foreign countries poor in capital and rich in raw materials” (158)....

N.B. [cf. above, p. 44 quotation: from pp. 159–60[37] ] N.B.

“According to statistical data, foreign capital investments are estimated at 7 0,000 million ||| 70 35 20 marks for Britain, 35,000 million for France (1910), but hardly 20,000 million for Germany in 1913” (160).

Quoting facts confirming “export stipulations” and the benefit accruing to industry from foreign investments, Schulze-Gaevernitz says, incidentally, that France also benefits from this:

||||| “The French rentier state is thus experiencing a second industrial flowering”—the floating of the Turkish loan in 1910 was made conditional on Turkey not giving to any country ||| character- istic!!! more orders than to France... (p. 163). || “Germany today is a typical ‘entrepreneur operating abroad’, whereas France, and gradually also Britain, are becoming ossified as rentiers.... Though the world of today has an Anglo-Saxon countenance, our banks, by N.B. ||| means of railways, mines, plantations, canals, irrigation works, etc., are working to give this countenance traits of the German spirit” (164)....

(N.B.: p. 1, note. “Written before the war.”)

In Chapter X.

N.B. || C. “Political appraisal of foreign investments.” || “The export of capital is a means for achieving the foreign policy aims and, at the same time, its success depends on foreign policy. || “a) The creditor’ states: France, Great Britain, Germany. Great Britain and France, the two big creditor powers of the world, are political bankers. The state and the banking community act as one and the same person. Such is the French Government and the Crédit Lyonnais. Such is the friendship of Edward VII and Sir E. Cassel. Hoping to win the main prize in the political lottery, France staked thousands of millions of francs on the Russian card alone. Russia, by obtaining money from France, was even able to act as a political loan giver in the Far East—in China and in Persia. France, as a loan giver, had a hold over Spain and Italy, and as her clients they helped her in Algeciras. France was prepared to extend to the Kossuth ministry loans she refused to Count Kuehn: ‘the earnest-money would have been the Triple Alliance’. As a political creditor, Great Britain cemented afresh the British world empire, without fear of pressure on the current value of her Consols. The d safety afforded colonial state loans in the metropolis enabled, for example, such a half-opened-up new country as Natal to enjoy cheaper credit than long-consolidated, highly respectable Prussia with her gigantic property in railways and state lands. This credit nexus is a ‘bond of interests’, stronger, perhaps, than Chamberlain’s preferential tariffs would ever have been. Going beyond the imperial connections, the British creditor keeps Japan in political vassalage, Argentina in colonial dependence, and Portugal in unconcealed debt bondage. The governors of Portuguese Africa, for all their gold braid, are British puppets” (165)....

...“The total [of German capital in Russia] is estimated at 3,000,000,000. The preference shown by our banks for this greatest of all N.B. || the debtors in world history is understandable if one bears in mind the high bank profits from Russian securities” (166).

|| gem!!! “There can be no doubt, that, in their efforts for political and economic independence, the semi-civilised countries not yet allotted as colonies cannot receive from any European power such unselfish support as from Germany. || gem!! China, Persia and Turkey know that Germany has no territorial claims” (167).

{{ impe- rialism and democ- racy[38] }} ...“Conditions within a country that are inimical to freedom are an obstacle also to world political thought penetrating deeply into the soul of a people. How far we are from the slogan ‘imperium et libertas’, to which ||| gem! (and N.B.) the Anglo-Saxons, from Cromwell to Rhodes, owe their greatest successes!” (168)

[[DOUBLE BOX ENDS: the bribing of wide sections of the petty bourgeoisie and of the upper strata of the proletariat is more subtle, more cunning ]]

“The German banks abroad everywhere encountered the competition of the long-established British ‘foreign banks’, which even today far surpass them in volume of business and size of share capital” (173)....

...“All the more soberly, therefore, must we regard the fact that we have arrived late on the scene. The activity of the German foreign banks can be likened to the highly promising steps of an eager youth from whom the greater part of the world has been barred by its fortunate possessor. Hardly a single German banking establishment is from be found in the ||| gem!!! British Empire, to say nothing of the French and Russian empires, and yet it is claimed that the Britisher rules the world in the interests of all. The future of German foreign N.B. ||| banking depends largely on solving a political problem: keeping of an open door to the still uncolonised countries, rebirth of the Moslem world, creation of a German colonial empire in Africa”... (174).

The second part of the book, the work of Jaffé is a dry-as-dust survey of Anglo-American and French banking. Nil.

Section VI of Principles of Social Economics. “Industry, Mining, Building.” Tübingen, 1914.

Many source references (cf. p. 37[39] ).

For statistical data on big industry see ruled notebook.[40]

[[DOUBLE BOX: Copy from the book: pp. 34 and 143, industry in 1882 and 1907 ]]

From the article by M. R. Weyermann: “Modern Industrial Technique.”

N.B. |||| quotes K. Rathenau’s book, The Effect of Increased Capital and Output on Production Costs in German Engineering Industry, 1906.

(pumps)
Pump models
Approximately 50% output increaseABC
1978801,593 marks
1627381,345
Typewriters (p. 157)
Numberproduced100Price=200 marks
500160
1,000140
2,000125

Issues of German industrial shares {according to the Frankfurter Zeitung and the Dictionary of Political Science} ((“New Issues”))

 1903—195,300,000 Beginning of boom ||| boom versus crisis 1904—267,600,000 ” ” ” 1905—492,500,000 Boom 1906—624,300,000 Boom peak 1907—240,200,000 Crisis 1908—326,700,000 (Beginning of revival)

According to Behr’s data, consumption of footwear in the United States was (p. 175):

 1880— 2.5 pairs per inhabitant ||| N.B. 1905— 3.12 ” ” ”

From Th. Vogelstein’s article “Financial Organisation of Capitalist Industry and Formation of Monopolies”.

||| N.B. “Ten years after May 9, 1873, when, in Schönlank’s exaggerated expression, the bells tolled the death of the economic boom and the birth of cartels, Fr. Kleinwächter published his book on cartels” (216).

From the history of cartels:

“Isolated examples of capitalist monopoly could be cited from the period preceding 1860; in these could be discerned the embryo of the forms that are so common today; but all this undoubtedly represents the prehistory of cartels. The real beginning of modern monopoly goes back, at the earliest, || to the sixties. The first important period of development || N.B. of monopoly commenced with the inter national industrial depression of the seventies and lasted until the beginning of the nineties” (222).

N.B. || “If we examine the question on a European scale, we will find that the development of free competition reached its apex in the sixties || and seventies. It was then that Britain completed the construction of her old—style capitalist organisation. In Germany, this organisation entered into a fierce struggle with handicraft and domestic industry, and began to create for itself its own forms of existence” (ibidem).

“The great revolution commenced with the crash of 1873, or rather, the depression which followed it and which—with hardly discernible interruptions in the early eighties, and an unusually violent but short-dived boom about 1889—occupies twenty-two years of European economic history” (222)....

...“During the short boom of 1889-90, the system of cartels was widely resorted to in order to take advantage of favourable business conditions. An ill-considered policy sent prices soaring more rapidly and steeply than would have been the case if there had been no cartels, and nearly all these cartels ended ingloriously in the ‘grave of bankruptcy’. Another five-year period of bad trade and low prices followed, but a new spirit reigned in industry. The depression was no longer regarded as something to be taken for granted; it was regarded merely as a pause before another boom.

second epoch of cartels |||| “The cartel movement entered its second epoch: from a transitory phenomenon, the cartels became one of the foundations of economic life. They were winning one industry after another, primarily, the industries processing raw materials. By the early nineties the cartel system had already acquired—in the organisation of the coke syndicate, N.B. ||| on the model of which the coal syndicate was later formed—a cartel technique which has hardly been improved on. For the first time the great boom at the close of the nineteenth century and the crisis of 1900–03 occurred entirely—in the mining and iron industries at least—within a cartel economy. And while at that time it appeared to be something novel, now the general public takes it for granted that large spheres of economic life have been, as a general rule, removed from the realm of free competition” (224)....[41]

Forms of cartels:

1. a) Cartels fixing sales conditions (terms, time limits, payment, etc....)
2. b) Cartels fixing the sales areas
3. c) Cartels fixing output quotas
4. d) Cartels fixing prices
5. e) Cartels fixing distribution of profit

Syndicate—single sales office (Verkaufsstelle)

Trustownership of all enterprises

[[BOX: sole and absolute power ]]

 Consult Kondt Lindenberg Sayous Steller Stillich Warschauer Weber

1. Pages of Lenin’s notebook.—Ed.
2. This refers to Kautsky’s pamphlet Der Weg zur Macht (The Road to Power), published in Berlin in 1909. Lenin called it Kautsky’s “last and best work” against the opportunists.
The Basic Manifesto on war was adopted by the Extraordinary Congress of the Second International in Basle, November 24–25, 1912. It exposed the predatory aims of the war the imperialists were preparing and called on the workers of all countries to wage a vigorous struggle for peace, against the threat of war, and “to oppose to capitalist imperialism the power of international proletarian solidarity”. Should imperialist war break out, it said, socialists must take advantage of the economic and political crisis it will cause so as to advance the socialist revolution (see present edition, Vol. 21 pp. 208–17 and 307–08). The leaders of the Second Inter national (Kautsky, Vandervelde, etc.) voted for the Manifesto at the Congress, but consigned it to oblivion and supported their imperialist governments when the war broke out. p. 30
3. See present edition, Vol. 22, p. 286.—Ed.
4. Ibid.—Ed.
5. Ibid.—Ed.
6. This refers to paragraph 9 of the RSDLP Programme adopted at the Party’s Second Congress. Paragraph 9 proclaimed “the right to self-determination of all the nations making up the state”. p. 42
7. See present edition, Vol. 6, p. 454.—Ed.
8. See present edition, Vol. 22, p. 206.—Ed.
9. Ibid., p. 203.—Ed.
10. See present edition. Vol. 22. p. 206.—Ed.
11. Ibid., p. 207.—Ed.
12. Interpolations in square brackets (within passages quoted by Lenin) have been introduced by Lenin, unless otherwise indicated.—Ed.
13. The data on the annual wages of workers in the U.S.A. in 1913 are taken from an article by Scott Nearing, “The Adequacy of American Wages”, published in The Annals of the American Academy of Political and Social Science, Vol. LIX, p. 115. p. 48
14. See present edition, Vol. 22, p. 245.—Ed.
15. Ibid., p. 245.—Ed.
16. See p. 70 of this volume.—Ed.
17. See present edition, Vol. 22, p. 234.—Ed.
18. Ibid., p. 234.—Ed.
19. Ibid., p. 235.—Ed.
20. Ibid., pp. 223–24.—Ed.
21. See present edition, Vol. 22, p. 215.—Ed.
22. Ibid., p. 252.—Ed.
23. Ibid., p. 202.—Ed.
24. See present edition, Vol. 22, p. 262.—Ed.
25. Marx’s concept of “socialisation”, based on a scientific analysis of the objective laws of development of capitalist society, points to the necessity and inevitability of the means of production passing from private capitalist ownership to social ownership. Lenin showed that the conflict between the production relations and the productive forces under capitalism becomes very acute in the era of imperialism. In this last stage of capitalism the concentration and socialisation of production reach the highest level (see present edition, Vol. 22, pp. 205, 207, 302–03). This makes it easier, after the victory of the socialist revolution, for the workers ’and peasants’ state to take over the basic means of production and organise planned production in the interests of the people. p. 56
26. Ibid., p. 303.—Ed.
27. See present edition, Vol. 22, pp. 303–04.—Ed.
28. Ibid., p. 211.—Ed.
29. Lenin refuted the apologetic inventions about the “democratisation” of capital as far back as 1902. He conclusively showed that individual workers acquiring small shares do not become owners of joint-stock enterprises, “propertied” people. The ones who profit from the issue of small shares are the big shareholders of the capitalist monopolies and joint-stock companies—they use for their enrichment even the very small crumbs of the people’s savings (see present edition, Vol. 6, p. 96). p. 61
30. See present edition, Vol. 22, p. 228.—Ed.
31. Ibid.—Ed.
32. In the Notebooks and Imperialism, the Highest Stage of Capitalism, Lenin exposes the bourgeois-apologetic nature of “organised capitalism”, an unscientific theory that seeks to prove that imperialism is a special, transformed capitalism which has abolished competition, anarchy of production and economic crises, and has achieved planned economic development. This theory, advanced by the ideologists of monopoly capitalism—Sombart, Liefmann, etc.—was seized upon by Kautsky, Hilferding and other reformist theoreticians of the Second International. Lenin demonstrated that monopolies’ rule, far from abolishing, intensifies competition and anarchy of production, and does not rid the capitalist economy of crises (see present edition, Vol. 22, p. 208). p. 62
33. See present edition, Vol. 22 p. 218.—Ed.
34. See present edition, Vol. 22. p. 211.—Ed.
35. Ibid., p. 219.—Ed.
36. See present edition. Vol. 22 p. 220.—Ed.
37. See p. 59 of this volume.—Ed.
38. In his study of imperialism, Lenin showed that political reaction in all aspects of home and foreign policy is the political superstructure of monopoly capitalism. Imperialism, he pointed out, is the negation of democracy in general (see present edition, Vol. 23, p. 43). Monopoly capitalism curtails or nullifies even formal bourgeois democracy, and establishes its unlimited dictatorship.
The characteristic features of imperialist for policy are aggression, violation of the national sovereignty of weak and dependent countries. p. 69
39. See pp. 50–51 of this volume.—Ed.
40. This refers to Notebook “μ”. see pp. 464—65 of this volume.—Ed.
41. See present edition, Vol. 22, pp. 200–02.—Ed.