The Idolatry of the State

by Franz Oppenheimer

Review of Nations, 2, 1927, pp. 13-26.

[p. 13] What is the State? Everyone seems to make an idol of it. Some regard it as
the most beneficent of deities, which men should worship with all their heart and
with all their soul, while to others it is the worst of devils, the curse of
mankind, and deserves to be sent back to the hell from which it came.

What is the reality between these two extremes? The answer which I have given in my
System der Soziologie is that it is a mixed form of human relationships, the
bastard offspring of might and right, of »ethos and kratos«.

The primitive forms of human relationship are two: The first I have called the »we«
relationship, because in it the sense of »I« falls into the background, or indeed
entirely disappears, giving place to the sense of »we«. In his sense of values, his
judgement and his actions the individual combines with his comrades in his group as
an indivisible unity, a whole of which he feels himself not a part, but a member.
In primitive times this collective consciousness and collective interest existed
within the tribe, in the relations between the members of the same horde or clan.
The second form of relationship, the »not-we« relationship, existed between one
tribe and another, in the relations between the men of a clan and strangers, or
members of another horde or clan. In this relationship the individual ego and the
group ego stand in strong opposition to the ego of the strange clan.

The »we« relationship stands for peace, morality and natural justice. The group
within which it prevails corresponds more or less to what Tönnies calls the natural
community, of which he writes: "Communal life is reciprocal possession and
enjoyment, and possession and enjoyment of common goods. [p. 14] The will to
possession and enjoyment is the will to defence and unity." Where this is the case,
the relationship of the members is that of co-operation.

The »not-we« relationship, on the other hand, is characterised by the sense of

foreignness. This means that the foreigner has no rights for »us«, and »we« have no
duties to him. This does not however necessarily result, in primitive times, in
that constant warfare of all against all which the Epicureans and Hobbes held to be
the beginning of the history of mankind, or in that »absolute hostility« which
Ratzenhofer imagined. On the contrary, we have evidence, in Australia for example,
of numerous cases of peaceful intercourse between different clans or tribes. At
this stage war has not yet become an end in itself; it is avoided as far as
possible, not out of any regard for the interests of the foreigner, but in the best
interests of the tribe itself. The clans are still so small that the loss of even a
few men in war may weaken them seriously, and in some cases even endanger their
existence. Thus, originally, it is not hostility which constitutes the »not-we«
relationship, but rather that cold indifference which primitive man also feels
towards animals - a complete lack of interest in the weal or woe of the stranger.
Where »my« or »our« interests are at stake, his do not count at all. The stranger
can be deprived of his property or his life without sin. Sin only comes into play
in a man's dealings with his comrades.

The transition between prehistoric and historic times is the age of migration and
conquest. At this stage the clans have become larger, and have either developed or
combined so as to form tribes, and in many cases even associated groups of tribes.
Here and there their own territory becomes too small for their primitive methods of
cultivation, and a tendency to expansion arises. A more numerous or better armed
tribe, or one which is capable of better tactical co-operation or more perfect
discipline, attacks and conquers another tribe. This, in all parts of the world, is
the origin of the State. The active factors in the formation of the State are in
the Old World the pastoral peoples and the sea-faring peoples which proceed from
them; in the New World the active factors are the more highly-developed hunting
peoples. The passive factors are as a general rule the less highly developed
cultivators, those who still cultivate their land by hoeing it by hand. The use of
the plough for cultivation only begins in the State, when the draught animals
introduced by the pastoral peoples - horses, oxen or camels - are harnessed to the
instrument used for tilling. The object of conquest and the subjection of other
clans is everywhere the same: it is exploitation. The conquered are compelled to
work for their conquerors without recompense, or to pay them tribute. The form
assumed by exploitation is mastership, which must [p. 15] not be confused with the
leadership of earlier times, which did not involve any kind of exploitation.
Mastership is leadership combined with exploitation.

Two institutions are created for the purposes of mastership: the separation of
classes and the large-sale ownership of land. These two form an indivisible whole.
The large-scale ownership of land has no real economic meaning (because only then
does it bring in income), except where there is a dependent labouring class which
tills the land for the benefit of an owner who does not work himself. Conversely, a
labouring class can only exist where the large estate as a legal form of land
ownership exists to such an extent that it makes large areas of land unavailable
for free settlement, so that there is a large landless population which is obliged
to take service on the land of a master in order not to starve. The identity
between land ownership and class superiority is reflected in language; in the
states created by the conquest of Germanic tribes the nobility are called »Adel«;
and »Adel« (Odal) means nothing else than large-sale land ownership.

The whole process must be presented in terms of economics if it is to be properly

understood. It is an act of satisfaction of economic needs on the part of the
conquerors. They obtain control of the subject populations by precisely the same
means and for precisely the same purpose as in earlier times, when they were
predatory nomads, they forcibly seized the herds of cattle or horses of their
neighbours in order to use them for their own benefit. Economy requires, however,
that acquired property should be carefully administered so that it is not lost or
spoiled. The human herd must be protected just as the herds of cattle which were
carried off were protected from enemies who wished to seize them; and just as care
was taken to maintain and if possible to improve the state of health and nutrition
of the herd of cattle, so are must be taken that the human herd does not decrease
in numbers or lose its working capacity. For this purpose the ruling class which
has come into existence since the creation of the State must at once undertake two
tasks: frontier defence and the maintenance of justice. The frontier has to be
defended against other warlike and predatory tribes of the steppe or of the sea-
board; justice has to be maintained in the face of any attempt at revolt by those
who are now subjects, and not less in the face of excesses of other members of the
ruling class itself which might diminish the productive capacity of the subjects.
The State is thus a society divided into classes and possessing institutions for
the defence of the frontier and the maintenance of justice; its form is mastership,
its content exploitation. In other words, the State is the vehicle of exploitation
and mastership.

Sociology has up to the present almost always seen only one aspect of the
historical State. It has only seen the State as the guardian of peace [p. 16] and
justice. Indeed it is commonly assumed that peace and justice did not exist until
the State came into being. This is a great error; the community which preceded the
State defended its territory and the lives and property of its members to the
utmost, and was exceedingly energetic in maintaining internal equality of rights.
The State merely took over from the community these two tasks, which must be
carried out if any kind of society is to exist at all. This misconception cherished
by previous sociology is the cause of its idolatry of the State, taking the form of
State-worship. Peace and justice are great benefits to society, and consequently it
is assumed, that the State, which is regarded not merely as the guardian of peace
and justice, but as the only possible means by which they can be created, must be
the greatest of all benefits. In reality however the State is nothing but one
community living as a parasite upon another. The victorious group so to speak eats
itself into the subject group just as Baron von Münchhausen's wolf eats itself into
the horse so that it finds itself in its harness and has to draw the sledge.
Similarly the victorious group has to draw the vehicle of society as a whole by
carrying out its most important functions.

If it is permitted to anticipate a little, it may be said here that the most

extreme social doctrine of the lower classes, which is anarchism, is based on the
opposite misconception. It sees nothing in the State but mastership and
exploitation, and does not see its function as the protector of peace and justice.
It therefore desires to get rid of the State altogether, and, grossly
overestimating the goodness of human nature, believes that peace and justice will
then automatically establish and maintain themselves. This is also idolatry of the
State, but the State is made into a devil instead of a god. The one theory is as
untenable as the other.

As soon as the State is created, sin comes into the world. For conquerors and
conquered now form a single society, in which - largely under the influence of the
defensive functions of the State - a »we« consciousness rapidly comes into being.
On the positive side this »we« consciousness embraces all the members of the State,
the lower as well as the upper classes, while on the negative side it excludes all
those who are not members of the State as »not-we«. The two groups which constitute
the State become amalgamated by intermarriage or by connections outside marriage,
speak the same language, worship the same gods, and soon come to have a common
tradition, built up largely out of the glorious victories which they have jointly
won against foreign enemies; in short, they become what Mac Dougall calls a highly
organised group. In a group of this kind, however, the spirit of comradeship ought
to prevail; there should be peace, morality and natural justice - justice based on
the innate sense of what is right; and justice means [p. 17] that all persons
should be recognised as equal in dignity. This is not the demand of a philosopher
remote from life who wants to arrange everything according to his own personal
ideas; it is the demand of morality itself, which speaks clearly and unmistakably
in every one of us as the voice of conscience. Man, trained into humanity in the
prehuman horde, is a »social animal«, as Aristotle said long ago. This means that
he feels within himself the categorical imperative which commands each man to treat
his comrades in his own group as his equals, to respect each man's personal
dignity, and always to treat him as a free agent and never as the mere object of
another's will. For this reason mastership and exploitation within any group that
has a »we« consciousness is sin.

That this is the case can be proved in two ways, even without venturing on to the
heights of abstract philosophy. The first proof is the following: Let the proudest
aristocrat, the greatest despiser of the lower classes, be thrown into a dungeon;
let him be starved, ill-treated and insulted. He will not accept his fate with
resignation as a mere misfortune or Act of God, but he will feel it with angry
indignation as an injustice - thus achieving his own reductio ad absurdum. The
second proof is that every ruling class has invented a special class theory of its
own to justify the prevailing state of injustice, and to make it appear to itself
as well as to the lower class as a state of justice. Thus the categorical
imperative is recognised even while it is denied.

The formula for this justification was given long ago by Plato: »Equality for
equals, inequality for unequals.« That is the sense of all the class theories of
the ruling classes. Wherever it was, or still is, desired to justify the most
extreme form of class system, namely, slavery, the view which always has been and
still is advanced is that expressed by Aristotle: »The barbarians are slaves by
nature and exist for the purpose of serving the nobler race of the Hellenes.« It is
more than probable that although they had never heard of Aristotle the planters of
the Southern States of the United States said exactly the same of the negroes, and
that all land-owning magnates have said the same of their serfs and bondsmen. Even
in the Edda we read that in the beginning of all things the gods created three
races, the slender aristocratic fair-haired jarl, the sturdy peasant (carl) and the
clumsy, stupid, flat-footed thrall (the born servant). All race theories are some
such attempt to legitimise injustice. This also applies to the »popular« anti-
Semitism of today. Just as according to the discoveries of modern folk-lore all
national costumes and all folk-songs are nothing else than costumes formerly worn
by the nobility and former courtly songs which have come down in the world, so the
racial theories of the populace of today are nothing else but [p. 18] class
theories of the nobility which have come down in the world and have greatly
deteriorated in the process; the false pride of the mob, which believes itself to
be naturally superior and more aristocratic on account of its so-called »Aryan«
blood, just as formerly the noble believed himself superior on account of his
»blue« blood.

Although it is somewhat differently coloured, the class theory of the bourgeoisie

is at bottom the same. The bourgeoisie rises above the lower classes by means of
its wealth, and thus, in the course of history, it comes into conflict first of all
with the two ruling classes of the feudal State, the nobility and the clergy. After
its victory it comes into conflict with the other members of what was formerly its
own class who have not risen, i. e. the proletariat. Here again the watchword is
»Equality for equals, inequality for unequals«. In this case however the inequality
is considered to reside not in race but in gifts. The virtues by means of which the
merchant rises: industry, punctuality, sobriety, economy, are believed to result in
a gradual differentiation of the originally uniform mass, first of all into strata
differing from one another in the amount of their income and soon also in the
amount of their property, which gradually crystallise into different social
classes.

This is the »law of original accumulation« which Karl Marx, in a famous passage of
»Das Kapital«, derides as an old wives' tale: »It plays approximately the same part
in political economy that the Fall of Man plays in theology. Adam ate the apple,
and so the human race became subject to sin ... In long past ages there were on the
one hand an industrious, intelligent and above all thrifty élite, and on the other
hand good-for-nothings who were idle and squandered all that they had and more ...
Thus it happened that the former accumulated wealth, while the latter finally had
nothing left to sell but their own skins. And from this Fall of Man dates the
poverty of the masses, who still, however, much they may work, have nothing to sell
but themselves, and the wealth of the few, which continues to increase although
they have long since ceased to work.«

This attempt at justification is just as unsound as the legitimist justification of

the nobility. In the first place there is every reason to assume that the
distribution of talent in human society is not essentially different from the
distribution of those qualities such as physical development, muscular strength,
acuteness of the senses etc. which can be directly measured. Intellectual
differences unfortunately cannot be measured; but if they are to account for the
difference in income and property between a Crassus and a Sicilian farm slave, or
between a Rockefeller and an East-End proletarian, then the minds of men must
differ from one another not merely as much as Gulliver from the midgets of
Lilliputia or the Brobdingnagian giants, but [p. 19] as the Lilliputians from the
Brobdingnagians. In the second place, even if such immense differences in mental
gifts really existed, they could never have given rise to differences of income and
property of real importance, and certainly not of sufficient importance to form
classes, until all the arable land of the earth was so completely occupied by
peasants cultivating small or medium-sized holdings that, as Jean-Jacques Rousseau
puts it, all the holdings, each touching another, cover the whole land. This is an
obviously true statement which is accepted by all authorities, whether bourgeois or
socialist. The great Turgot said: »So long as the industrious man can still find
land on which he can work independently, he will not be inclined to work for anyone
else«; Adam Smith, the father of economic science; definitely lays it down that
until the land is fully occupied there an be no working class, no ground rents and
no profit on capital. Karl Marx expresses exactly the same view in the last chapter
of the first volume of »Das Kapital«: »So long as any settler can still transform a
piece of land into his private property and his individual means of production,
without preventing future settlers from carrying out the same operation«, there is
no class of wage-earners and consequently no capitalism.

As a matter of fact, however, a working class and capitalism have existed for the
last five hundred years. Consequently there is no more land freely available for
men without means who need land. The only question is whether it was really
occupied in the way presupposed by the »old wives' tale« in which Turgot and Adam
Smith believed. Did one free peasant really settle next to another until all the
holdings, each touching the other, covered the whole land? This question can be
answered by a simple calculation. We know accurately how much land an independent
peasant needs if he is not in a position to hire paid workers as farm hands; on an
average he requires not more than one hectare per head, i. e. 5-7 hectares for the
whole family, for the holding. If we divide the cultivable area of the earth by
this figure, we find to our astonishment that the number of independent peasants
who could live on the earth is from four to eight times (different geographers'
estimates of the cultivable area of the earth differ very widely) the total
population of the world. If we take one of the most densely populated countries in
the world, e. g. Germany, we shall find that there is room for independent peasants
with middle-sized holdings to a number equal to double that of the total rural
population; and yet more than half of the rural population consists of landless
agricultural proletarians, and even among the holders of land there are immense
numbers who have only dwarf holdings or plots which do not provide them with a
living, and who are obliged to supplement their income by means of paid work.

[p. 20] Thus if the settlement of the earth or of a single large country had taken
place in the way that Rousseau believed, then only one-quarter or perhaps one-
eighth of the earth, and in a country such as Germany barely one-half, would be
occupied; and the formation of a working class and the consequent accumulation of
wealth in a few hands could not even begin for centuries or perhaps even for
thousands of years, notwithstanding any differences in individual talent, however
great.

The complete occupation of the land must therefore have taken place in some other
way than Rousseau believed. There is only one other possibility: the masses must
have been shut out from the land; it was monopolised by the conquering class under
the legal form of the large estate in order to create a working class and to make
large incomes and accumulations of wealth possible. It was said above that there
can only be a working class where under the legal form of the large estate the land
is made unavailable for free settlement to such an extent that there is a large
surplus population which is compelled to work on the land of a master in order to
avoid starvation. We have now proved this statement to be true.

These considerations make the nature and the method of procedure of the modern
State comprehensible. It has already been said that every State is the vehicle of
mastership and exploitation. This also applies to the modern State. The form of
exploitation which it both embodies and protects is capitalism. And capitalism is
the direct consequence of the closing of access to the land.

If this fact has not hitherto been realised, the chief reason is that capitalism
has been far too narrowly conceived, both as regards its nature and as regards the
time of its appearance. Bourgeois sociology, and still more bourgeois economics -
which in this respect as in so many others is almost slavishly followed by
socialist theory in general - centres round industry; it is hypnotised by what has
taken place in the towns, and takes no account whatever of the development of
affairs in the country -although it must surely be clear even to the casual
observer that urban trade, commerce and industry are merely a secondary growth on
the main stem of national economy, whose growth, prosperity and decay are closely
bound up with the growth, prosperity and decay of the main stem, which represents
the market for the products of urban industry. Starting from this erroneous
standpoint, it is believed that historically capitalism begins with the development
of the stock system and of the factory, and only attains its full development with
the development of power-driven machinery in the towns. Capitalism is practically
identified with the machine system. In reality, however, capitalism is much older
and much more widespread. [p. 21] Capitalism exists wherever employers who can
dispose of the labour of exploited proletarians supply goods to a market under a
developed financial system. The exploited workers need not be free citizens. They
may be slaves; thus it is customary to speak of the capitalistic slave-system of
Greek and Roman antiquity. They may also be serfs, bondsmen or an agricultural
proletariat bound to the soil; and in actual fact modern capitalism everywhere
began in the country as a system of exploitation of workers bound to the soil.
Brodnitz, in his economic history of England, has conclusively shown this to be
true in the case of England, the classic example of a capitalist country. In that
country the workers enjoyed personal freedom from the Middle Ages onwards, but they
did not enjoy freedom of movement because the parochial laws hindered free movement
from the land, while the rules of the guilds and corporations made migration to the
towns almost impossible. Thus agrarian capitalism, the supply of food to the urban
markets, preceded industrial capitalism by hundreds of years; the latter only
followed very slowly and hesitatingly, and did not really develop until a time when
freedom of movement had been attained.

What happened in Germany was precisely the same. Georg Friedrich Knapp has
established that »the large estate east of the Elbe is the first capitalistic
undertaking of modern times«. In this case also the agricultural workers were tied
to the soil, or were made so in the course of the process by open or legally veiled
force. Here too agrarian capitalism came into existence centuries before industrial
capitalism, and here too the latter only followed slowly and with hesitation, and
did not fully develop until freedom of movement had been attained - in Germany by
the emancipation laws of Stein and Hardenberg, in Austria-Hungary and Russia after
the freeing of the serfs.

This is in outline the way in which capitalism and the modern State, which
enshrines it, must be regarded in order to be properly understood.

All previous attempts to explain capitalism have taken industry as their starting-
point. They have sought the cause of the central phenomenon which accounts for
everything else, namely the constant surplus of labour on the market, solely in the
conditions of urban industry. All these attempts have failed, both the bourgeois
explanation, the Malthusian law of population, and the socialist explanation, the
replacement of human labour by machinery. Of the former there is no need to speak;
it is now entirely abandoned, and it is in fact untenable. The second explanation
is contrary to all the statistical data. The number of workers and employees
engaged in industry and commerce in all capitalist countries increases at an
enormously greater rate than the total population. If there were no influx from
without, [p. 22] the average wage would in these circumstances have risen very much
more than is actually the case.

There is however always such an influx. It can come from nowhere else than the
country. But it does not come to he same extent from all rural districts, but
chiefly from those where there are large estates and those, therefore, are alone
responsible for the surplus of labour on the market. This was established
statistically by von der Goltz as early as 1874, and it can also be established
deductively. The day labourers on the large estates are subject to the »law of
increasing pressure from one direction«, and this drives them to mass migration.

In this way, and in this way only, the history of capitalism can be understood in
all its phases. First of all there are the horrors of the early days of industrial
capitalism throughout the world. Before freedom of movement had been achieved,
industry developed very slowly; there were only few and small undertakings, and
these employed only a small number of comparatively prosperous and well-paid
workers. The moment that freedom of movement from the country became possible, a
reservoir of misery which had been accumulating for ages suddenly poured itself
out; for agrarian capitalism had forced the tied agricultural proletariat down to
and even below the physiological minimum standard of living. The supply of labour
thus created flooded the labour market, and the wages of the older working class
were dragged down, while under the influence of low wages urban capitalism shot up
as in a forcing-house. Migration, however, thinned out the rural proletariat, while
at the same time the rapid growth of the towns led to an increased demand for
foodstuffs. Consequently the price of foodstuffs rose, and agriculture was driven
to adopt intensive methods. This meant not only the use of machinery, but also an
increased demand for labour. This again resulted in a rise in wages. Higher wages
in agriculture had to outbid the still-growing industries; this in itself resulted
in a further rise of industrial wages, especially as the proportion between the
inflowing agricultural proletarians and the industrial proletariat already
established was constantly growing more favourable to the latter; where previously
hundreds of thousands had flowed in on tens of thousands, now tens of thousands
were flowing in on hundreds of thousands. The pressure on the labour market grew
comparatively easier, even if the absolute number of rural workers migrating to the
towns had remained the same; but as a matter of fact it decreased as soon the first
rush of the dammed-up flood had ceased.

This is the perfectly simple explanation of the appalling misery which accompanied
industrial capitalism in the first decades of its existence, and the gradual
improvement in the wages and living conditions of the workers [p. 23] in all
countries in which the capitalist order has prevailed for any length of time. It is
not trade unionism, as so many people suppose, which has brought this miracle to
pass, but the proportional decrease in the influx of rural workers; and the result
would have been better still if all these countries had not received a large stream
of immigrants from foreign countries which were still industrially undeveloped, and
where the large estate and consequently agrarian capitalism still prevailed.

This contention is fully proved by the amazing development of capitalism in the

United States, especially in the last ten years. There the wages and standard of
living of the majority of the workers, those at all events who have acquired the
language of the country and learnt to understand its social conditions, have risen
to an extent that neither bourgeois nor Marxist theory can even begin to explain.
Twenty years ago, in an essay entitled »What Russian agrarian reform means to
us«[1], I wrote as follows: »Here, in the feudal agrarian constitution of the Old
World, reside, clearly recognisable, the roots of the serious evils from which the
New World suffers. Freedom cannot prosper anywhere so long as slavery still exists
anywhere else. For it is an infection which spreads across mountain and ocean.
Suppose that as a result of Russian or rather of Eastern European agrarian reform
mass immigration into the United States ceased even for a decade, what would become
of American capitalism? The already high wages of urban and rural workers would
rise enormously; the already colossal requirements of foodstuffs and industrial
products on the home market would reach giddy heights; labour would become the
rarest of commodities.« This prophecy has been literally fulfilled. I have before
me a book published in 1926 by Thomas Nixon Carver, Professor at Harvard
University, entitled »The present economic Revolution in the United States«. On p.
VIII appears the following passage: »Notably, because of the stoppage of
immigration by the war, followed by restrictive legislation, our wage workers have
continued to earn a larger share in this prosperity than wage workers have ever
gained.« The author sees quite clearly that American capitalism, which in spite of
his rosy optimism he cannot deny, is only to be explained by immigration: »For
forty years preceding the Great War we were importing manual labourers, literally
by the millions. We were not importing any very large number of employers or
capitalists.« (p. 37.) This was the cause of the surplus on the labour market. But
»during the last half-dozen years, since we have removed the disturbing factor, or
greatly reduced it - that is, the importation of vast numbers of unskilled
labourers, - we are gradually relieving [p. 24] the occupational congestion under
which we suffered for at least two generations.« (pp. 45-46.) The results produced
are already extraordinary, even although the immigration over the Canadian and
still more the Mexican frontier still brings in enormous numbers of workers who are
not only unskilled and of different race, but quite illiterate and difficult if not
impossible to adapt to the conditions of civilised life - who are in fact coolies
or peons. This is paving the way for a new negro question. At the same time the
workers who have been assimilated already enjoy a standard of living which might
well be envied by even the upper middle classes of a country such as Germany. A
mason employed on piece-work in New York earns as much as 14 dollars a day, or
allowing 25 working days to the month, 1,500 marks a month. All the statistics show
that the workers are not only able to put by something for a rainy day, but that
they can actually accumulate a considerable capital. One workers' bank after
another is instituted, and these banks are beginning to take an active part, to the
benefit of the class for which they were created, in the financing of industry.
Brady estimates the sum annually paid as wages to industrial workers in the United
States at the present day at 25 milliards of dollars, and the amount of this saved
annually at 6-7 milliard dollars. Even if this is a considerable over-estimate, the
fact remains that if anything like these sums are flowing into the workers' banks,
they will soon be in a position to control an increasingly large section of
industry and to direct its wages and price policy in the interests of the workers.
Even today it can be proved that in many of the largest and most influential
undertakings a considerable proportion of the shares are in the hands of the
workers and employees.

Everyone will of course realise the dangers to which a development of this kind is
exposed. Everyone knows that in certain circumstances, and in the hands of
unscrupulous capitalists, the joint stock company is a very convenient arrangement
for expropriating the small shareholder by the manipulation of the exchange market.
This however is not the decisive factor in the matter under consideration. The
decisive factor is that the workers should be in a position to accumulate such
immense sums; if they suffer from setbacks, they will learn by experience where
they can invest their savings safely and profitably. The best means for this
purpose is certainly the institution of workers' banks with proper regulations and
subject to the supervision of expert and reliable persons. The savings of European
workers, which in their total represent a large body of capital, even though the
separate items may be very small, have hitherto been invested in a way which so far
from benefiting the workers, only serves to rivet their chains more firmly. The
savings banks in which their scanty savings are placed [p. 25] have had no
possibility open to them except short-term investments in bills of exchange and
long-term investments in mortgages, principally on urban real estate. Thus they
have increased the capital of financiers and contributed to the strength of the
worst enemy of the working classes - speculation and profiteering in land.

To return to the United States and Prof. Carver, it is quite clear that American
opinion has as yet no inkling that the large estate is the ultimate cause of all
the evils which formerly existed, and which, in spite of the improvement which has
taken place, still persist. Carver dismisses in a few words the enormously
important fact that in the last two hundred years the State has made a present of
the immense treasure of the national land to itself, i. e. to its upper classes, in
order to shut the lower classes out from it and thus to create the working class
which was required. In my »System der Soziologie« (III, pp. 540 et seq.) I have
described this deplorable practice, which has prevailed not only in America but in
all European colonies. This is the real reason why for a whole generation an
excessive proportion of the European immigrants have remained in the large towns,
and this although most of the immigrants were agricultural workers. And whence did
these immigrants come? Almost entirely from the European regions of large estates,
first from Germany east of the Elbe and Ireland, from England, and then from
Poland, Russia, Rumania, Sweden, Southern Italy etc. The peasant countries of
Europe only contributed a few small tributaries to the immense stream, only a small
percentage of the total number. And what is the position in Mexico? Mexico is a
land of the most enormous estates, where the land is enclosed to an unprecedented
extent. The consequence is that in spite of its immense size and extremely scanty
population its people are forced to emigrate because the way to a livelihood at
home is blocked. A further consequence is that the peons are »animals without
souls«, like the agricultural workers in all countries where the large estate
prevails. The words of Isaiah apply to Mexico: »Woe unto them that join house to
house, that lay field to field, till there be no place, that they may be placed
alone in the midst of the earth!«

With this the chain of proof may be said to be complete. It has been said that the
State, that creature of forcible conquest, that parasite on the body of the
community, created two institutions as soon as it came into existence: the division
of classes and the large estate. The division of classes has been destroyed by the
great revolutions of 1649 in England, of 1789 in France, of 1848 in Germany, and of
1917 in Russia; the large estate has up to the present only been radically
abolished in Russia. In the latter country the revolution was however bound up with
activities which were [p. 26] not only entirely superfluous but exceedingly
destructive, and that is the only reason why this region, which is equal to the
United States in natural resources, is unable to achieve prosperity.

The other nations still have before them the task of uprooting from their midst
this last remaining creation of primitive violence, of completing the work of the
middle class revolution, and thus of bringing into the world real freedom, which
can never exist where, as Rousseau puts it, »some are rich enough to be able to buy
many, and many so poor that they have to sell themselves.«

We have now ascertained the nature and the future of the modern State. It is in
reality the vehicle of capitalism; but we have learnt from the history of its
development that capitalism in neither quite so good nor quite so bad as is still
almost universally believed in Europe. It too in a mixture of kratos and ethos. And
so the capitalist State does not deserve to be made into an idol, either good or
bad; it deserves neither apotheosis, nor, if a word may be coined, »apodiabolosis«.
It is the bastard offspring of slavery and freedom; and the great task before us is
to get rid of the remaining traces of slavery and bring full freedom into being.
Our descendants will then live under an order which will still be a State in so far
as it possesses fixed laws and institutions with the duty and power of enforcing
them, but yet will not be a State because it will not, like all previous States
known to history, represent mastership and exploitation.

Translated into English from the German Manuscript

By Miss Monica Curtis-Geneva