(Our monthly review had to be held over from the last issue due to lack of space. We print here only that part of the review which concerns England.)
Shortly before the anniversary of the February Revolution, when Carlier had the trees of liberty[3] cut down, Punch printed a drawing of a tree of liberty whose leaves are bayonets and whose fruits are bombs, and opposite this French tree of liberty, bristling with its bayonets, in a song of its own it sings the praises of the tree of English liberty, bearing the only sound fruit: pounds, shillings and pence.b
But this feeble counting-house joke vanishes beside the immense outbursts of rage with which The Times has been foaming since March 10 at the triumphs of "anarchy".c The reactionary party in England, as in all countries, feels the blow struck in Paris as if it itself had been directly hit.
What threatens "order" in England most at present, however, is not the dangers emanating from Paris but a new and quite direct consequence of this order, a fruit of that English tree of liberty: a trade crisis.
In our January review (No. 2)d we already referred to the approach of the crisis. Several circumstances have hastened it. Before the last crisis in 1845, surplus capital found an outlet in railway speculation. The over-production and over-speculation in railways attained such a level however that the railway business did not recover, not even during the boom of 1848-49, and even the shares of the soundest enterprises of this kind are still exceptionally depressed in price. The low corn prices and the prospects for the harvest of 1850 equally provided no opportunity for the investment of capital, and the various state bonds were subject to too much of a risk to become the object of any large-scale speculation. Thus the surplus capital of the period of prosperity found its usual escape channels blocked. The only thing left for it to do was to throw itself completely into industrial production and into speculation in colonial products and in the decisive raw materials of industry, cotton and wool. With such a large part of the capital usually employed elsewhere flowing directly into industry, industrial production was naturally bound to increase with unusual rapidity and with it the glutting of the markets, and hence the outbreak of the crisis was significantly hastened. Already the first symptoms of the crisis are appearing in the most important branches of industry and financial speculation. For four weeks now that all-important branch of industry, cotton, has been completely depressed, and of its components the most important ones are those that are suffering most — the spinning and weaving of ordinary cloths. The fall in the prices of twist and of ordinary calicoes has already left the fall in the prices of raw cotton far behind. Production is being cut back; almost without exception the factories are now only working short time. A momentary reinvigoration of industrial activity was expected with the spring orders from the Continent; but while the orders given earlier for the internal market, for East India and China, and for the Levant are for the most part being cancelled, the continental orders, which always provided two months' work, have hardly come in at all as a result of the uncertain political conditions.—Here and there in the woollen industry symptoms can be seen which indicate the imminent end of the present, still fairly "healthy" state of business. The production of iron is similarly suffering. The producers consider it inevitable that prices will soon fall, and are trying to stop them from falling too rapidly by means of a coalition among themselves. So much for the state of industry. Now for financial speculation. The fall in cotton prices is due partly to new and increased supplies and partly to the depression in the industry. The same thing goes for colonial products. Supplies are increasing, consumption in the internal market is decreasing. In the last two months alone twenty-five shiploads of tea have arrived in Liverpool. The consumption of colonial products, held down even during the boom by the distress in the agricultural districts, is feeling all the more heavily the pressure, which is now spreading to the industrial districts too. Already one of the most important colonial import houses in Liverpool has succumbed to this recession.
The effects of the trade crisis now breaking will be more significant than those of any crisis hitherto. It coincides with the agricultural crisis which already began with the repeal of the Corn Laws in England[247] and was intensified with the recent good harvests. For the first time England is simultaneously experiencing an industrial crisis and an agricultural crisis. This double crisis, in England is being hastened and extended, and made more inflammable by the simultaneously impending convulsions on the Continent, and the continental revolutions will assume an incomparably more pronounced socialist character through the recoil of the English crisis on the world market. It is common knowledge that no European country reacts so directly, so extensively and so intensively to the effects of the English crisis as Germany. The reason is simple: Germany forms the largest continental market for England's exports, and the major German export articles, wool and corn, have by far their most significant outlet in England. History seems to have a weakness for that epigram to the Friends of Order, according to which the working classes revolt from insufficient consumption and the upper classes go bankrupt from superfluous production.
The Whigs will naturally be the first victims of the crisis. As of old they will abandon the helm of state as soon as the threatening storm breaks out. And this time they will say farewell to the Downing Street offices for good. A short-lived Tory ministry may follow them in the first instance, but the ground will be quaking under it, all the opposition parties will unite against it, with the industrialists in the van. These have no such popular panacea to oppose to the crisis as they had in the repeal of the Corn Laws. They will be forced to advance at least to a reform of Parliament. That is, they will assume the political power which cannot be denied them, in conditions which open the doors of Parliament to the proletariat, place the demands of the latter on the agenda of the House of Commons and hurl England into the European revolution.
* * *•
We have but little to add to these notes, written a month ago, concerning the impending trade crisis. The momentary improvement in business which regularly comes in spring has at last occurred this time also, although admittedly to a lesser degree than usual. French industry, which for the most part supplies light summer fabrics, has especially profited from it; but increased orders have also come in to Manchester, Glasgow and the West Riding. This momentary revival of industry in spring occurs every year, incidentally, and only delays a little the development of the crisis.
Commerce in East India has experienced a momentary improvement as well.- The more favourable rate of exchange in relation to England allowed the sellers to get rid of part of their stock below former prices, and the Bombay market was thus eased a little. This local and momentary improvement of business is also one of those border-line cases which occur from time to time, particularly at the start of every crisis, and which only have an insignificant influence on its general course of development.
On the other hand, reports have just come in from America which depict the market there as completely depressed. The American market, however, is the most decisive. With the glutting of the American market, with the standstill in business and the fall of prices in America the crisis proper will begin — the direct, rapid and irresistible reaction upon England will commence. We need only refer to the crisis of 1837. Only one article continues to rise in America: the United States national debt bonds, the only state bond which offers secure asylum to the capital of our European Friends of Order.
Following the entry of America into the recession brought about by over-production we may expect the crisis to develop rather more rapidly in the coming month than hitherto. Political developments on the Continent are likewise pressing daily more urgently towards a showdown, and the coincidence of trade crisis and revolution, which has already been mentioned several times in this Revue* is becoming more and more certain. Que les destins s'accomplissent!b
London, April 18, 1850
See this volume, pp. 52-53.— Ed. Let fate take its course! — Ed
13-1124
Endnotes
[246] The bulk of this review was written by Marx and Engels for the Neue Rheinische Zeitung. Politisch-ökonomische Revue No. 3 in the middle of March 1850, and forwarded to Hamburg not later than April 5. Lack of space prevented the material from being published in No. 3. Only part of the review dealing with England, as well as a small addendum written later and dated April 18, were included in No. 4 of the Neue Rheinische Zeitung. Politisch-ökonomische Revue.
[3] In May 1849, when the counter-revolution was on the upsurge, the Prussian Government issued an order expelling Marx and the other editors of the Neue Rheinische Zeitung from Prussia. This measure, prepared well in advance, was applied when the main uprisings in the Rhine Province had been virtually suppressed. On his return to Cologne in April 1848, Marx applied for Prussian citizenship which he had been forced to renounce in 1845 when he was living in Belgium as an emigrant. Despite the Cologne Magistrate's favourable reply to his application, however, the Cologne royal district authorities and the Minister of the Interior refused to grant it, and Marx remained a "foreigner", who could at any moment be accused of abusing hospitality and expelled. The royal district authorities' note to this effect followed on May 11, 1849, and on May 16 Marx was given 24 hours to leave Prussia. Weerth and Dronke, who did not enjoy Prussian citizenship either, received similar orders. Legal proceedings were instituted against Engels for his part in the Elberfeld uprising. The last issue, No. 301, of the Neue Rheinische Zeitung appeared on May 19, 1849.
[247] See Note 29.