Friedrich Engels

[On the Company-Promotion Swindle in England]

["Der Volksstaat" No. 91, 11 November 1871]

London, 4 November. — We are now here in the full swing of prosperity and brisk business — we, i.e., official England, the big capitalists. Capital is abundant on the market and everywhere seeks profitable investment; swindling companies for the blessing of mankind and the enrichment of the promoters shoot up like mushrooms. Mines, asphalt pits, horse-tramways for big cities, ironworks now appear to be most in vogue; mines are on offer on the Volga and in New Mexico; asphalt pits have been bought up in Savoy, in the Jura, in Hanover; Lisbon and Buenos Aires are to receive horse-tramways, etc. All these joint-stock companies have, of course, no other purpose than to drive up the shares for the moment so that the promoters can dispose of their holding at a profit; what becomes of the shareholders afterwards is no concern of theirs: “After us the deluge!” In three, four years five sixths of these swindling companies will have gone the way of all flesh, and the money of the shareholders caught on the limed twig will have gone with them. As always, it will mostly be small people who invest their savings in these “extremely solid and advantageous” undertakings, and precisely at the moment when the shares have been driven by the swindle to their highest point — and serve them right. The share swindle is one of the most potent means of channeling the small people’s alleged, and to some extent no doubt actually self-earned, wealth into the pockets of the big capitalists, so that it becomes clear to even the densest that in today’s social order “self-earned” capital is utterly impossible, that rather all existing capital is nothing more than the yield of alien labour appropriated without payment. And if this company-promotion swindle has also recently got into full swing in Germany and Austria, if princes and Jews, imperial chancellors and little parsons jointly hunt for the small people’s savings, this can only be welcome to us.

This overflow of capitals on the money market is, however, only the reflection of the flourishing state of large-scale industry. In almost all branches of production, work is being done with a briskness such as has not been seen for years, especially in the two main industries of England, those in which iron and cotton form the raw materials.

The Lancashire spinners have at last once again enough cotton to be able to expand their factories on a massive scale; and they are not letting the opportunity pass. In little Oldham alone fifteen new spinning mills are under construction, averaging fifty thousand spindles each — together 750,000 spindles, almost as many as the entire Zollverein (without Alsace) contains! Besides, power looms in proportion, and the same is happening in the other Lancashire towns. The engineering works are booked up for months, some for a year in advance, and are paid any price provided only they can deliver. In short, it looks again like 1844, after the opening of the Chinese market, when the manufacturers had only one fear, that they might be unable to deliver enough: after all, as they said, they had to produce clothes for 300 million people! At that time came the recoil of 1845 and 1847, when it suddenly turned out that the 300 million Chinese had hitherto obligingly made their clothes themselves, and the overproduced English goods lay unsaleable in heaps on all markets, while the manufacturers and speculators went bankrupt by the hundred. And so it will come again now; these people learn nothing, and even if they did learn something, the inner law of capitalist production compels them constantly to repeat the well-known cycle of business upswing, overproduction and crisis, to repeat it on an ever larger scale, until finally the rise of the proletariat frees society from the necessity of this senseless cycle.

A certain Herr Schwitzguebel demands in the “Volksstaat”, in the name of a Federal Committee of Romanish Switzerland unknown to me, further explanation regarding what I published in the “Volksstaat” concerning Mr Elpidin. I have absolutely nothing to do with Herr Schwitzguebel and cannot in this matter give any account whatever to an unauthorised third party. If, however, Mr Elpidin himself should apply to the editorial board in this matter, I am at his service and request the editorial board of the “Volksstaat” in that case to communicate my address to Mr Elpidin, so that he may apply to me directly.