Bank of the People

31st January 1849

Translator: Clarence L. Swartz (“Declaration” and “Formation of the Company”) and Ian Harvey (“Report of the Luxembourg Delegate and Workers’ Corporation Commission”)


I swear before God and man, upon the Gospel and on the Constitution, that I have never held nor professed any other principles of reform than those laid down in the present treatise, and that I ask nothing more, nothing less, than the free and peaceful application of these principles, and their logical, legal and legitimate consequences.

I declare that in my innermost thought, these principles and the results which flow from them, are the whole of Socialism, and that beyond is nothing but utopia and chimeras.

I vow that in these principles, and in all the doctrine to which they serve as a basis, nothing — absolutely nothing — can be found opposed to the family, to liberty, or to public order.

The Bank of the People is but the financial formula, the translation into economic language, of the principle of modern democracy, the sovereignty of the People, and of the Republican motto, Liberty, Equality, Fraternity.

I protest that in criticising property, or rather the whole mass of institutions of which property is the pivot, I have never intended either to attack individual rights, based upon existing laws, or to contest the legitimacy of acquired pos. sessions, or to demand an arbitrary division of goods, or to place any obstacle to the free and regular acquisition, by sale and exchange, of property, or even to forbid or suppress, by sovereign degree, ground rent and interest on capital.

I think that all these manifestations of human activity should remain free and voluntary for all: I ask for them no modifications, restrictions or suppressions, other than those which result naturally and of necessity from the universalisation of the principle of reciprocity which I propose.

What I say of property, I say of every political and religious institution as well. My sole aim, in passing through the crucible of criticism the different parts of the social structure, has been to discover, by a long and laborious analysis, yet higher principles, whereof the algebraic formula is announced in this treatise.

This is my testament in life and in death: he only may doubt its sincerity who can lie when on his death-bed.

If I am mistaken, the good sense of the public will soon dispose of my theories: there will be nothing left for me but to disappear from the revolutionary arena, after having asked pardon from society and from my brothers for the annoyance which I may have caused to their minds, of which I am, after all, the first victim.

But if, after being discredited by general good sense and experience, I should seek again some day to excite the feelings and arouse false hopes by other means or by new suggestions, I would invoke upon myself thenceforth the scorn of honest people and the maledictions of the human race.




Article 2. The object of this Company is to organise credit democratically:

(1) By procuring for everyone the use of the land, of buildings, machines, instruments of labour, capital, products and services of every kind, at the lowest price, and under the best possible conditions;

(2) By facilitating for all the disposal of their products and the employment of their labour, under the most advantageous conditions.


Article 9. The Company holds the following principles: That all raw materials are furnished to man by nature gratuitously.

That therefore, in the economic order, all products come from labour, and reciprocally, that all capital is unproductive.

That as every transaction of credit may be regarded as an exchange, the provision of capital and the discount of notes cannot and should not give rise to any interest.

In consequence, the Bank of the People could and should operate without capital; as it has for its base the essential gratuity of credit and of exchange; for its object, the circulation of values, not their production; for its methods, the reciprocal agreement of producers and consumers.

This end will be attained when the entire body of producers and consumers shall have become supporters of the by-laws of the Company.


Article 28. [...]

The Bank of the People, while favouring workers’ associations, maintains the freedom of commerce and emulative competition as the principle of all progress and the guaranty of good quality and low price of products.


Article 51. Advances thus made by the Bank are not made as a joint stock company, and cannot be at all likened to redemption of shares of stock; they are, like advances on Consignments of merchandise, and like opening of accounts on real estate, simple discount transactions, and compose the proper function of the Bank.

Article 52. For this purpose there is to be established at once in the office of the Bank of the People, a special division under the name of General Syndicate of Production and Consumption.

It will be directed by Citizen Andre-Louis-Jules Lechevalier, Ex-Secretary of the West India Company. The powers of the Syndicate are for the present as follows:

(1) To receive the declarations of manufacturers and dealers who desire to place themselves in relations with the supporters of the Bank of the People and to enjoy the custom of the Company, and who therefore wish to give information as to their names, occupations, addresses, their special products or services, the qualities and prices of their merchandise, and the amount of their remittances and deliveries;

(2) To receive the requests of consumers, and to make sure of the chances of success for new enterprises by exact investigation of the demand;

(3) To publish a bulletin of commerce, agriculture, and industry, containing, together with the Bank’s reports and the market quotations, all announcements and notices, such as demands for and offers of labour, demands for and offers of merchandise, reductions of prices, information of manufacturers and dealers newly admitted into the Company; this bulletin to be inserted in the newspaper, Le Peuple, which is appointed by these presents the official organ of the Bank of the People, in its relations with its shareholders, its supporters and the public;

(4) To solicit the support of producers whose products and services are needed by the Company, and, in case of their refusal, to start, among the members, competing establishments in similar lines;

(5) To begin a record of general, comparative and detailed statistics of commerce, industry and agriculture; in a word, to obtain, by every possible means, the extension and strengthening of the Company.


Organisation and Administration of the Bank


Article 63. As soon as circumstances permit, the present Company will be changed into a joint-stock company, as this form will enable it to realise, in accordance with the desire of its founders, the triple principle, 1st, of election; 2nd, the division and independence of its functions; 3rd, the individual responsibility of each employee.


Article 66. The General Manager may be dismissed [...]

His dismissal involves by law the revocation of all powers that he may have granted to his Assistant Managers.


The Council of Oversight

Article 70. A council of thirty delegates will be created to supervise the administration, and to represent the sleeping partners in their relations to it.

They will be chosen by the General Assembly from among the shareholders or supporters in the various branches of production and of public service.

Article 71. The Council of Oversight will be renewed by thirds from year to year.

Departing members for the first two years will be selected by lot. A departing member may be re-elected.

In case of vacancy in the course of the year, the Council will fill it temporarily.

Article 72. The Council of Oversight will meet at least once a month, at such time and place as it may think fit. Its functions are:

(1) To see that the by-laws are observed;

(2) To have submitted to it, as often as it may think proper but at least once every three months, a statement of accounts by the General Manager;

(3) To verify the accounts presented by him, and to make report thereon to the General Assembly;

(4) To represent the shareholders, whether as plaintiff or as defendant, in all differences with the General Manager;

(5) To call special meetings of the General Assembly when it thinks proper;

(6) To declare that it opposes or does not oppose propositions for sale, alienation or hypothecation which may be made by the General Manager; to provide judiciously for the replacement of the General Manager in case of death, resignation or dismissal, until the General Assembly shall have named another manager.

Each of its members, moreover, has the right to examine the books and documents of the Company whenever he may choose to do so.

The Council of Oversight may delegate three of its members for a year, who shall be particularly charged with examining as often as possible, the books, the cash, and all the transactions of the administration.

Compensation for loss of time may be granted to the delegates, of which the amount shall be determined by the General Assembly.


The General Assembly

Article 74. The General Assembly shall be composed of one thousand delegates at most, named by the whole body of members and supporters;

Article 75. The election of delegates shall be made by industrial classes, and proportionally to the number of members and supporters in each class.

The bulletin of the Bank will announce before the elections the number of delegates to be named by each profession and locality.

Article 76. The Annual Meeting of the General Assembly shall take place regularly in the first month of each year.


The General Assembly, composed as above described, represents the whole body of shareholders and supporters.


Article 78. Decisions shall be made by a majority of votes of members present, whatever their number.

Article 79. In addition to the Annual General Assembly, there may be special General Assemblies, summoned either by the management, or by the Council of Oversight.


Article 81. The objects of the General Assembly shall be:

1st To receive the accounts and reports of the management, and to approve them if possible, after having heard the advice of the Council of Oversight;

2nd To amend, if necessary, the by-laws, upon the motion of the Manager or of his delegates, all constitutional powers for that purpose being granted to him;

3rd To deliberate upon all questions submitted to it, nevertheless without interfering with the management;

4th To decide upon any increase in the capital, and to order the issue of additional shares in connection therewith;

5th To order the recall of the Manager, upon the motion of the Council of Oversight;

6th To appoint another Manager if necessary;

7th To appoint the members of the Council of Oversight and to provide every year for replacing them;

8th To determine the rate of discount for the coming year;

9th To point out the general needs of the Company, and the means of satisfying them.



To set this presentation in order, we will start by dealing with the mechanism of those various institutions by supposing their complete and definitive organisation; then we will present the various modifications intended to harmonise the institutions with the current special organisation from the start so that they operate in a practical way.

Each of the two parts of this presentation will therefore be divided into three distinct chapters:

The Bank of the People,

The Syndicate of Production,

The Syndicate of Consumption.

Let us begin with an overview of all of these establishments.

All of you know that any bank is nothing other than a mechanism of circulation. Therefore, the three institutions above can be summarised with three words:




That is, these are all of the social functions anticipated within their three economic aspects.

In fact, production and consumption may be considered the two poles of the social organisation that circulation is intended to balance, and from that perspective, circulation becomes the crucial cog.

We will begin this presentation with the Bank of the People, which is the circulation organisation.



As you know, citizens, first under the name of the Exchange Bank and then of the Bank of the People, citizen Proudhon has tried to constitute an institution of circulation that can be for the People what the Bank of France is for the bankers.

Our friend’s proposed goal has been to steal away the masses of workers from capital’s exploitation. Therefore, he has had to try to lower capital’s interest so that it only represents the indispensable fees for Bank of the People administration, that is, compensation to its employees for their labour, plus the cost of the risks inherent in any operation of that type, risks such as the prime rate decreasing due to the increased number of Bank members. Once those conditions are met, credit becomes free.


The Bank’s Internal Organisation

The main establishment of the bank will be in Paris. In each neighbourhood, it will have a counter, and in each commune it will have a correspondent bank. Its internal organisation in both Paris and the department is based on the three principles:

1. Election,

2. The division and independence of employees,

3. The individual responsibility of each employee.


Among the members of the commission responsible for developing the Bank of the People project is citizen Jules Lechevalier, a mutual friend, whom you all know, and whose great deal of work as a socialist has earned him a justly deserved position. We are indebted to him for the idea of establishing the two unions that we are going to discuss with you; the development of the organisation, as will be presented to you in the follow-up to this work, is under his special direction.

Just as Proudhon had organised circulation in his bank project, Jules Lechevalier asked himself if, to complete that work, it was essential for him to create two major controls by organising production, on the one hand, and consumption, on the other, so that the production and distribution of products could function as economically as possible and the social transformation would be facilitated by the gradual elimination of parasitic functions in production and consumption, just as the Bank of the People operates in relation to circulation.

In the name of those unions, he first designed two large corporations responsible for centralising production and consumption operations so that all the various retail operations, which came to the Bank of the People as the major circulation agent, had to first go through one of those two corporations, which, independent from the bank, also provided it with guarantees inherent to business itself, the bank coming from the community of those same businesses represented as a body by both of those large corporations, which vouch for all operations they send to the bank; furthermore, the relationships between those two corporations had to go through the Bank of the People, which was for them, as for all the business they centralised, the major and sole circulation element.

First, we have to present to you the fundamental idea on which a large part of the development work we must begin will operate.

Up until now, various economists have only understood two things as capital:

1. Raw materials appropriated for use;

2. Accumulated labour, represented by those same materials implemented.

But with regard to the human race, the great creator of all wealth: although those who exploited labour considered it as income, they did not consider the accumulated individual talent, which was the source of that income, as capital. However, in the land of slaves where the race of humans is so truly appropriated that it is designated as real property, humans are considered as capital on which all circulation operations, known as bank operations, take place as they do with properties (movable and immovable), which constitute what we in Europe call capital.

Therefore, let’s examine if humans under the conditions of freedom lose the very thing that pertains to them, their virtue of being capital, that is, they will be able to conduct operations on themselves to their own benefit, operations that, in the state of slavery, the master conducted on them to their detriment.

The only objection that could be made is that humans in a state of slavery are a constant source of labour because that labour is forced, but in the state of freedom, with the ability to voluntarily cease to produce, they do not present the same degree of solvency as they do in the first state.

How specious that objection is, and the facts victoriously answer it: on the soil of the United States, the least encumbered soil of all civilisations, slavery is disappearing overnight due to the competition of free labour.

If we now compare humans considered from this new perspective with the dead material believed until now to be the only capital, we find that humans have the double property of being able to value and strengthen themselves in an even more effective manner through mutual life insurance.

Therefore, an average partnership of approximately 500 francs each, or 18 billion for all the French people together, will then be completely guaranteed by the living capital on which that partnership will have been made because all of the workers, by only taking as a base the effective creation of wealth in the current regime of atomisation, represent a capital of between 169 to 259 billion if we consider France’s revenue to be between 8.5 and 12 billion.

Let’s now move on to a specific examination of each of these institutions.

General Syndicate of Production

This syndicate’s active membership will be comprised of proper delegates from the various production branches. Its responsibilities will be:

1. To create the free and democratic corporation as the absolute and definitive system for all workers, regardless of their present social condition: already organised in associations, still belonging to the employers or working in isolation from each other; it must also give rise to the organisation of associations.

2. To put the workers’ in a position of liquidity, that is, to make themselves and their work tools available.

Workers’ advances depend on three bases:

1. Each producer’s prior availability.

2. Workers’ reciprocal financing for means of production.

3. Reciprocal financing of food supplies for workshops and labour.

4. Centralisation of manufacturers’ relations on all products.

5. Control of products.

6. Co-operation in the distribution of labour and therefore of unemployment among the various workshops with the goal of improving the balance between production and consumption.

7. Co-operation in the liquidation of obsolete industries in favour of new ones.

8. Provision of the general costs of industrial development and compensation for industrial displacements due to the use of new processes

9. Reimbursement of inventors

10. Solicitation of inventions and improvements

11. Establishment of a common fund for reciprocal compensation to be awarded to various industries

12. Establishment of mutual insurance of all the corporations against all disaster subject to valuation

13. Negotiation and guarantee of each special corporation’s loans vis-à-vis the Bank of the People, it being agreed that the only coverage will be the fair valuation of the worker’s life in capital and current circulation on the labour force’s obligations

14. Organisation of apprenticeship, so that:

1. Children can always find a place to pursue their vocations;

2. There is no glut of workers in a corporation;

3. Apprentices, through reimbursement agreements their parents contract for them, can receive the necessary credit for food when their work does not cover its expense;

4. All corporations that need apprentices can have them at will.

15. Determination of each corporation’s relationship with the general union with regard to its sharing of expenses for apprentices connected with the corporation and the means for reimbursing those expenses

16. Determination of benefit conditions and mutual services in case of illness, accident or disability; the union provides for these by means of its reserve fund and a contribution from all the workers to the general fund. It will negotiate the conditions under which it shall interact with all corporations with regard to union members

17. Organisation of a central pension fund, the deposits into which will be produced through the corporations’ contributions; this central fund in concert or in participation with the corporations will contribute to the workers’ pensions

18. Search for a method of meshing work to avoid inherent unemployment in certain industries and the counterbalancing of the fatal influence that the extended division of work produces on workers.


The Syndicate of Consumption is responsible for storing raw materials and manufactured products, as well as for ensuring flow.

It will credit workers with raw materials and make all advances on manufactured product consignments.

Therefore, it will provide raw materials to all industries from seeds to precious metals and ensure a regular supply. It will provide for all preparations, productions and services necessary for the needs of life.

Product Distribution Service

The Syndicate of Consumption will be a general supply and commission business.

In that regard, it will have combined buildings constructed from a perspective of safety, economy and the distribution of forces for all social needs and services.

It will have bakeries, butcher shops, fruit shops, grocery stores, etc. established — in short, establishments in all branches of industry involved in people’s direct consumption.

It will store all raw materials and receive them on consignment.

There will be general warehousing for all raw materials with limited consumption and special warehousing for those with significant consumption.

It will open credits and reach agreements with the Syndicate of Production and various corporations for supplies connected with various production workshops.

It will make advances to the Syndicate of Production on manufactured products deposited with it or consigned for sale.

In all centres, it will directly organise raw material warehouses and merchandise bazaars or initiate relations with already existing local establishments of that nature.

Concurrently with the Syndicate of Production, it will exert its control on product quality and prices.

It will deliver products and raw materials to the best market in return for circulating bonds and cash.

To connect the syndicates in a more unified manner with the Bank of the People, a division will be formed within the bank under the title of central bureau of supply and demand to receive all offers and requests and forward them to the proper syndicates so as to prevent procedural problems on the part of the public, which need not be familiar with the organisations’ internal details, such as going to one of the syndicates for operations that are the domain of another syndicate. As we have seen above, this would be especially likely because the industries concerned with manufacturing products appropriate for personal use are under the aegis of the Syndicate of Consumption even though they are production work.


In 1789, despotism had its fortress; it was the Bastille. In one of its days of sublime rage, the People razed it to the ground, and on its site, that evening, one could read the inscription, so beautiful in its simplicity: Here is where we danced.

In 1849, financial feudalism has its fortress: it is the Bank of France. A clever engineer has come to tell us that this fortress, which all thought impregnable, is not so. Let us have courage, then, and the temple of usury, no longer seeing the product of our sweat flow into its coffers, deserted by its priests, will collapse, taking the old world with it.