Harmony of Interests, Theory of

The following article is from The Great Soviet Encyclopedia (1979). It might be outdated or ideologically biased.

Harmony of Interests, Theory of

 

one of the basic dogmas of the school of vulgar political economy. The best-known representatives of this theory were F. Bastiat in France and H. C. Carey in the USA. Bastiat, whom Karl Marx described as “the most banal and therefore the most successful representative of the vulgar-economic apologetic” (K. Marx and F. Engels, Soch., 2nd ed., vol. 23, p. 18), tried to prove that the bourgeois society was “the best, the most perfect, the most solid, the most universal, and the most just of all associations.” Disclaiming the contradictions and class antagonisms of capitalism, Bastiat depicted bourgeois society as a harmonious entity, based on mutual rendering of services. He denied the objective essence of value, which is created in the process of production of wares. The value, or simply the cost, according to Bastiat’s terminology “is the relation between two service exchanges.” These “services,” according to Bastiat, are rendered not only by the workers but also by capitalists and landowners. In his view, the income of the capitalists, their profits, are the rewards for deferring the use of the capital; the land rent, he believed, was a percentage on capital invested in the land as a reward for the services of the landowner and his ancestors in the cultivation and improvement of the land. Bastiat enlarged his idea of economic harmony to embrace production, as well as relations of distribution of bourgeois society. In his opinion, the capitalist’s share in a given product falls, while the share of the workers grows. The only thing that can break this harmony is the interference of the state in the economic relations of people. He advocated unlimited freedom of competition and free enterprise, that is, a development of capital that is in no way hindered.

Another variation of this theory of the harmony of interests came from the USA. Its exponent was Carey. He not only defended capitalism but also justified slavery as it existed in the southern USA. Carey tried to demonstrate the presence in bourgeois society of a complete harmony of real and genuine interests. He relied on “the law of distribution” as the basis of his theory. In his writings he maintained that this law, of all the laws established by science, is very likely the best, since its effect is to establish a full harmony of the true and real interests of the different classes of human society (Principles of Social Science, vol. 3, New York, 1859, p. 113). The foundation of this theory of the “identity of interests” of the proletariat and the bourgeoisie, was built by Carey on an erroneous, unproven assumption, as if in capitalistic society the wages increased together with the increase of the productivity of labor of effort and consequently the differences in the economic conditions of the worker and the capitalist become smaller. By drawing, in luminous colors, the situation of the Negroes on the plantations, Carey tried to establish the presence of a harmony of interests of slaves and their owners.

F. Walker (1840-97) also advocated the theory of the harmony of interests of the bourgeoisie and the proletariat. A representative of American bourgeois political economy of the second half of the 19th century, he maintained that profits were entirely created by entrepreneurs, because an increase in profits depended on the ability of the entrepreneur. The workers receive wages according to the production of their work. He did not see any discrepancy between the wages of the worker and the profit of the capitalist. The logical conclusion of Walker’s contention was his appeal for “peace in industry,” for “peaceful settlement of conflicts between workers and entrepreneurs.”

The American economist H. George maintained that economic crises, unemployment, and the poverty of the masses do not arise out of the laws of capitalism themselves but out of the violation of these laws, as a result of which the land falls into the hands of landowners; these landowners appropriate in the form of rent all the fruits of social production. The liberation of capitalism from these artificial disruptions, that is, the appropriation of rent by the bourgeois state, could supposedly provide a “harmony of work and capital” and eliminate the crises of overproduction and the poverty of the masses.

Other followers of the theory of the harmony of interests were M. Wirth and E. Dühring in Germany and N. Kh. Bunge in Russia.

The idea of the harmony of interests, which was born out of vulgar political economy, was interpreted and continued by bourgeois political economy of the 20th century. It became the main part of the apologetic conception of maximum productivity, the aim of which was to conceal the antagonistic contradictions of contemporary capitalism. According to the contentions of one of the better-known advocates of this conception, the American economist J. B. Clark, there is no exploitation in the capitalist society, but rather a cooperation of different classes, participating together in production and dividing the income according to the productivity of the particular factor of production (labor or capital) possessed by each. On these ideas of the harmony of the class interests rest the contemporary apologetic conceptions of “cooperation,” the “social partnership,” “people’s” capitalism, “collective” capitalism, and so on, which are aimed at giving a theoretical basis to the “popular” character of contemporary capital and at convincing the toiling masses of the necessity of upholding it.

REFERENCES

Marx, K. Kapital, vol. 1. K. Marx and F. Engels, Soch., 2nd ed., vol. 23, pp. 18, 70, 91, 92, 204, 419, 545.
Marx, K. “Kari i Bastia.” Ibid., vol. 46, part 1.
Chernyshevskii, N. G. Izbrannye ekonomicheskie proizvedeniia, vol. 2. Moscow 1948. Page 546.
Al’ter, L. B. Burzhuaznaia politicheskaia ekonomia SShA. Moscow, 1961. Chapter 4.

N. V. OPARIN

The Great Soviet Encyclopedia, 3rd Edition (1970-1979). © 2010 The Gale Group, Inc. All rights reserved.