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In all of these cases, and they are all historic, it is not distribution that seems to be organized and determined by production, but on the contrary, production by distribution.

In the most shallow conception of distribution, the latter appears as a distribution of products and to that extent as further removed from and quasi-independent of production. But before distribution means distribution of products, it is first, a distribution of the means of production, and second, what is practically another wording of the same fact, it is a distribution of the members of society among the various kinds of production (the subjection of individuals to certain conditions of production). The distribution of products is manifestly a result of this distribution, which is bound up with the process of production and determines the very organization of the latter. To treat of production apart from the distribution which is comprised in it, is plainly an idle abstraction. Conversely, we know the character of the distribution of products the moment we are given the nature of that other distribution which forms originally a factor of production. Ricardo, who was concerned with the analysis of production as it is organized in modern society and who was the economist of production par excellence, for that very reason declares not production but distribution as the subject proper of modern economics. We have here another evidence of the insipidity of the economists who treat production as an eternalPg 287 truth, and banish history to the domain of distribution.

What relation to production this distribution, which has a determining influence on production itself, assumes, is plainly a question which falls within the province of production. Should it be maintained that at least to the extent that production depends on a certain distribution of the instruments of production, distribution in that sense precedes production and constitutes its prerequisite; it may be replied that production has in fact its prerequisite conditions, which form factors of it. These may appear at first to have a natural origin. By the very process of production they are changed from natural to historical, and if they appear during one period as a natural prerequisite of production, they formed at other periods its historical result. Within the sphere of production itself they are undergoing a constant change. E. g., the application of machinery produces a change in the distribution of the instruments of production as well as in that of products, and modern land ownership on a large scale is as much the result of modern trade and modern industry, as that of the application of the latter to agriculture.

All of these questions resolve themselves in the last instance to this: How do general historical conditions affect production and what part does it play at all in the course of history? It is evident that this question can be taken up only in connection with the discussion and analysis of production.

Yet in the trivial form in which these questions are raised above, they can be answered just as briefly. In the case of all conquests three ways lie open. The conPg 288quering people may impose its own methods of production upon the conquered (e. g. the English in Ireland in the nineteenth century, partly also in India); or, it may allow everything to remain as it was contenting itself with tribute (e. g. the Turks and the Romans); or, the two systems by mutually modifying each other may result in something new, a synthesis (which partly resulted from the Germanic conquests). In all of these conquests the method of production, be it of the conquerors, the conquered, or the one resulting from a combination of both, determines the nature of the new distribution which comes into play. Although the latter appears now as the prerequisite condition of the new period of production, it is in itself but a product of production, not of production belonging to history in general, but of production relating to a definite historical period. The Mongols with their devastations in Russia e. g. acted in accordance with their system of production, for which sufficient pastures on large uninhabited stretches of country are the main prerequisite. The Germanic barbarians, with whom agriculture carried on with the aid of serfs was the traditional system of production and who were accustomed to lonely life in the country, could introduce the same conditions in the Roman provinces so much easier since the concentration of landed property which had taken place there, died away completely with the older systems of agriculture. There is a prevalent tradition that in certain periods robbery constituted the only source of living. But in order to be able to plunder, there must be something to plunder, i. e. there must bePg 289 production.161 And even the method of plunder is determined by the method of production. A stockjobbing nation162 e. g. can not be robbed in the same manner as a nation of shepherds.

In the case of the slave the instrument of production is robbed directly. But then the production of the country in whose interest he is robbed, must be so organized as to admit of slave labor, or (as in South America, etc.) a system of production must be introduced adapted to slavery.

Laws may perpetuate an instrument of production, e. g. land, in certain families. These laws assume an economic importance if large landed property is in harmony with the system of production prevailing in society, as is the case e. g. in England. In France agriculture had been carried on on a small scale in spite of the large estates, and the latter were, therefore, broken up by the Revolution. But how about the legislative attempt to perpetuate the minute subdivision of the land? In spite of these laws land ownership is concentrating again. The effect of legislation on the maintenance of a system of Pg 290distribution and its resultant influence on production are to be determined elsewhere.

c. Exchange and Circulation. Circulation is but a certain aspect of exchange, or it may be defined as exchange considered as a whole. Since exchange is an intermediary factor between production and its dependent, distribution, on the one hand, and consumption, on the other; and since the latter appears but as a constituent of production, exchange is manifestly also a constituent part of production.

In the first place, it is clear that the exchange of activities and abilities which takes place in the sphere of production falls directly within the latter and constitutes one of its essential elements. In the second place, the same is true of the exchange of products, in so far as it is a means of completing a certain product, designed for immediate consumption. To that extent exchange constitutes an act included in production. Thirdly, the so-called exchange between dealers and dealers163 is by virtue of its organization determined by production, and is itself a species of productive activity. Exchange appears to be independent of and indifferent to production only in the last stage when products are exchanged directly for consumption. But in the first place, there is no exPg 291change without a division of labor, whether natural or as a result of historical development; secondly, private exchange implies the existence of private production; thirdly, the intensity of exchange, as well as its extent and character are determined by the degree of development and organization of production, as e. g. exchange between city and country, exchange in the country, in the city, etc. Exchange thus appears in all its aspects to be directly included in or determined by production.