Engels on Proudhon and The Housing Question

First, three new chapters from Property is Theft! have been posted:

Second, below is something originally written as an appendix to a detailed reply to Marx’s The Poverty of Philosophy I was working on a few years ago. It is nearly finished and in need of review (I get the impression it is a bit repetitive in places) but it was used for the following pieces which have been published:

One aim of the work was to embed Proudhon’s (and another’s) marginal notes into Marx’s text before discussing the claims made in more detail. Proudhon ignored part 1 of Marx’s book and his comments are – all bar one, if I recall correctly – scribbled in part 2. They are definitely of interest so I may get around to finishing and revising the text and post it here in the Property is Theft! blog.

Suffice to say, it is a deeply dishonest work by Marx and should not be taken seriously as an account of Proudhon’s ideas nor as a critique of them. If it were a serious critique, Marx would not have felt the need to invent and doctor quotes to portray Proudhon as an idiot. The same can be said of Engels’ claims in The Housing Question – as will be shown below.

I should note that, like Marx, Engels in this text makes much of Proudhon appealing to “eternal justice” (justice eternelle), an expression which he rarely used – he used the expression “eternal justice” twice in the two volumes of System of Economic Contradiction and both times in an ironic fashion, Marx four times – once in a quote which he attributes to Proudhon:

“Certainly,” cries M. Proudhon, “there is one; it is arbitrary. The price which results from this struggle between supply and demand, between utility and estimation will not be the expression of eternal justice.”

There is no page number given, for the simple reason that Marx made-it up… I will not dwell on Engels use of “eternal justice” to assert that Proudhon wanted to abolish industry (no quote provided, of course) to return to handcrafts so individual workers could exchange their product directly, simply because Proudhon explicitly rejected such a call as in System of Economic Contradictions and based his critique of capitalism and vision of a socialist society on “collective force”

More could be written on the distortions and inventions inflicted upon Proudhon by Marx and Engels (amongst others) but time is pressing and I have done so before many-a-time – but of interest here is this reply to a Marxist: The Poverty of Mick Armstrong’s Polemic

Finally, I should note that this text was originally posted elsewhere: Engels on The Housing Question and Proudhon (again) and that there is a more direct, revolutionary, solution to the Housing Question than the reformist path suggested by Proudhon, namely one advocated by Kropotkin: expropriation.

Notes on The Housing Question

It is not only The Poverty of Philosophy which saw the founders of Marxism distort Proudhon’s ideas. While questionable commentary on Proudhon exists in Capital and Theories of Surplus Value, Engels’ The Housing Question matches that of Marx’s 1847 work and is worth discussing.

Engels’ 1872 work is part of a polemic within German socialist circles and sought to defend the Marxist orthodoxy against those influenced by the French anarchist seeking “to transplant the Proudhonist school to Germany”. Needless to say, he paints a picture of Proudhon’s ideas which are in complete contradiction to the work he references in support of his summation, namely Proudhon’s 1851 work General Idea of the Revolution while somewhat incredulously noting that Marx had “delivered a decisive blow precisely to the Proudhonist ideas as far back as twenty-five years ago” – if so, then why is he having to do so in 1872? (Marx-Engels Collected Works 23: 238, 317)

Engels suggests that Proudhon’s aim to solve the housing question involves a scheme in which the workers “become part-owner” of dwellings by “paying annual instalments” via their rent. So if a worker lives in a rented property then the rent they pay goes towards buying the house. This means that if the rent is 10 Francs per month and the house is valued at 2,400 Francs then the house would become theirs after 20 years. For the amusement of his readers, he paints a picture of a worker moving from rented accommodation to rented accommodation and accruing a tiny fraction of each one. In this way “the individual worker becomes owner of the dwelling”. (Marx-Engels Collected Works 23:238, 386)

Given how obviously impractical this proposal is, the equally obvious question is: did Proudhon actually advocate such a scheme. Consulting the work and pages explicitly referenced by Engels (Marx-Engels Collected Works 23: 387), the answer is a resounding no:

“From the date of the decree which shall be passed by future representatives, all payments made as rental shall be carried over to the account of the purchase of the property, at a price estimated at twenty times the annual rental.

“Every such payment shall purchase for the tenant a proportional undivided share in the house he lives in, and in all buildings erected for rental, and serving as a habitation for citizens.

“The property thus paid for shall pass under the control of the communal administration, which shall take a first mortgage upon it, in the name of all the tenants, and shall guarantee them all a domicile, in perpetuity, at the cost price of the building.

“Communes may bargain with owners for the purchase and immediate payment for rented buildings.

“In such case, in order that the present generation may enjoy the benefit of reduction in rental, the said communes may arrange for an immediate diminution of the rental of the houses for which they have negotiated, in such manner that complete payment may be made within thirty years.

“For repairs, management, and upkeep of buildings, as well as for new constructions, the communes shall deal with bricklayers companies or building workers associations, according to the rules and principles of the new social contract.

“Proprietors who occupy their own houses shall retain property therein, as long as suits their interests.” (“General Idea of the Revolution”, Property is Theft!, 576)

Note well that in Proudhon’s scheme that housing “shall under the control of the communal administration” and that the tenant gains “a proportional undivided share in the house he lives in, and in all buildings erected for rental, and serving as a habitation for citizens.” In short, the aim is to achieve social ownership of housing and the rent paid does not accrue ownership to the individual worker but rather the commune. This makes sense as, unlike the individual worker, housing does not move. In short, the rent paid in rental by whoever lives in the house over the twenty year period goes towards the commune becoming the owner after twenty years. The worker gains access to all such social housing in every commune.

Engels, in short, either cannot understand Proudhon’s argument or deliberately seeks to distort it. The answer seems to be the latter for in 1851 he accurately noted that Proudhon’s scheme meant “converting interest payments into repayments, all real wealth being concentrated in the hands of the State or the communes” and suggests that “it takes far too long” as these are “systematically protracted measures, extending over 20 or 30 years”. (Marx-Engels Collected Works 38: 421-2) He also accurately quotes Proudhon in the notes of an aborted review around the same time. (Marx-Engels Collected Works 31: 560-1) Clearly Engels did know what Proudhon had actually advocated but decided to distort his ideas.

It should be noted that, Proudhon makes the same suggestion for land:

“Every payment of rent for the use of real estate shall give title to the farmer for a share of the real estate, and shall be a lien upon it.

“When the property has been entirely paid for, it shall revert immediately to the commune, which shall take the place of the former proprietor, and shall share the fee-simple and the economic rent with the farmer.

“Communes may bargain directly with owners who wish to do so for the repurchase of rentals and the immediate purchase of the properties.

“In that case, provision shall be made for the supervision of the communes, for the installation of cultivators, and for the fixing of the boundaries of possessions, taking care to make up by an increase in quantity for any deficiency in the quality of the land, and to proportion the rent to the product.

“As soon as all landed property shall have been completely paid for, all the communes of the Republic shall come to an understanding for equalising among them the quality of tracts of land, as well as accidents of culture. The part of the rent to which they are entitled upon their respective territories shall serve for compensation and for general insurance.

“Beginning with the same date, the former proprietors who have held their title by working their properties themselves, shall be placed on the same footing as the new, subjected to the same rights; in such a manner that the chance of locality or of succession may favour no one, and that the conditions of culture shall be equal for all.

“The tax on land shall be abolished.

“The rural police are placed under the control of the municipal councils.” (“General Idea of the Revolution”, Property is Theft!, 578-9)

Notice the references to economic rent which mirror comments in System of Economic Contradictions but with the difference that while in 1846 it went to all in 1851 it is now “the other land workers who hold inferior land” which explains “why in our scheme […] every variety of cultivation should pay a proportional contribution, destined to accomplish a balancing of returns among farm workers, and an assurance of products.” (Property is Theft!, 582) Also of note is that the land would “revert immediately to the commune”, so suggesting the ending of private property with possession as suggested in 1846 when “from now on the question to resolve” was “[h]ow, by destroying property, would men all become proprietors?” Economic rent, “considered in its principle and its aim, is the agrarian law by which all men must become guaranteed and irremovable proprietors of the soil”. (Système des contradictions économiques ou Philosophie de la misère [Paris: Guillaumin, 1846] II: 271, 314)

Ironically, after Marx (wrongly) proclaiming that economic rent was a category only applicable to farming under capitalist conditions in 1847 Engels admits twenty-five years later that “the abolition of property in land is not the abolition of ground rent, but its transfer, if in a modified form, to society. The actual seizure of all the instruments of labour by the working people, therefore, does not at all preclude the retention of rent relations.” (Marx-Engels Collected Works 23: 386) Unless, of course, this is referring to the kind of transitional system Marx dismissed in 1847 like the state-capitalism he embraced in 1848?

Needless to say, Engels in The Housing Question takes the time to repeat all the standard Marxist nonsense about Proudhon, for example that he had “an aversion to the industrial revolution” and wished “to drive the whole of modern industry out of the temple”. Engels suggests that Proudhon’s use of the term the “productivity of capital” was “an absurdity that Proudhon takes over uncritically from the bourgeois economists” and that he “differs from the bourgeois economists in that he does not approve of this ‘productivity of capital’, but on the contrary, discovers in it a violation of ‘eternal justice’” as it “is this productivity which prevents the worker from receiving the full proceeds of his labour”. It would be abolished by “lowering the rate of interest by compulsory legislation” (Marx-Engels Collected Works 23: 325, 331)

Ignoring the obvious nonsense of being opposed to industry, what of the other claims? In terms of “the productivity of capital”, yes, he does use the term but only to proclaim that the theory is a “fiction” as “all value is born of labour” and so contrasts the “the theory of the real productivity of labour” with “that of the fictitious productivity of capital”. Apparently in Marxism proclaiming something a fiction equates to “uncritically” taking it over. In short, while bourgeois economists use the term “the productivity of capital” Proudhon dismisses it as simply a cover for the exploitation of labour. This, for Proudhon, does violate justice as this requires that “all labour must leave a surplus, all wages be equal to product” so it appears that he is to be mocked for opposing the exploitation of labour by capital! (Système des contradictions économiques I: 16, 18, 305) Given Proudhon’s position that labour is the source of value and that wages must equal product, he did not think that lowering interest rates would do this directly but rather allow workers to get sufficient credit to create their own companies and so secure the “full proceeds” of their labour by abolishing wage-labour.

The notion of justice has been one which has driven many socialists and working people to change society and it does Engels little favours to mock it so. Needless to say, he adds that “this justice is still called ‘eternal justice’ […] later on, nothing more is said about eternity, but the idea remains in essence” and so he is unaware that Proudhon used the term just once in System of Economic Contradictions compared to four times that by Marx. (Marx-Engels Collected Works 23: 378) As it stands, developments in biological science have indicated that a sense of justice is a product of our evolution and so it is Engels and Marx who have been judged wrong by history rather than Proudhon.

Finally, Engels claimed that Proudhon had in 1851 appropriated, without acknowledgement, Marx’s ideas as his own. In a letter to Marx, he proclaimed that he was “convinced” that the Frenchman had read The Communist Manifesto and Marx’s The Class Struggles in France as “our premises on the decisive historical initiative of material production, class struggle, etc., largely adopted” and a “number of points were indubitably lifted from them – e.g., that a gouvernement is nothing but the power of one class to repress the other, and will disappear with the disappearance of the contradictions between classes”. Another letter states that Proudhon “seems to be making progress” for he “has now come to the conclusion” of “the disguised confiscation of all property by a more or less disguised State”. (Marx-Engels Collected Works 38: 434–5, 418)

Both claims are false – as is the confusion of considering all social organisations “states”.

In reality, Proudhon had concluded that the state was an instrument of class power long before Marxism was invented. For example, in Chapter VII of System of Economic Contradictions he noted that the state was “inevitably enchained to capital and directed against the proletariat. No political reform can solve this contradiction […] The problem before the labouring classes, then, consists, not in capturing, but in subduing both power and monopoly […] generating from the bowels of the people […] a greater authority, a more potent fact, which shall envelop capital and the State and subjugate them.” (Système des contradictions économiques I: 363-4)

As for the claim that in 1851 Proudhon had finally recognised the need for social ownership, in reality in 1840 he had argued that while people “are proprietors of their products […] not one is proprietor of the means of production. The right to product is exclusive […] the right to means is common” and so “all accumulated capital being social property, no one can be its exclusive proprietor” and “all property becomes […] collective and undivided.” (Property is Theft!, 112, 118, 137)

Suffice to say, very little of what Marx and Engels proclaimed against Proudhon can be taken at face value and without taking the trouble of verifying whether it is accurate or not.