Silvio Gesell - The NATURAL ECONOMIC ORDER
out of place in the university, and for this reason economic science must languish in the hands of our professors. A professor has scarcely gone a spade's depth into his subject when the menace: "Thus far but no further !" rings in his ears. Added to these external difficulties is the fact that the theory of this thorny subject requires knowledge which can only be obtained in practical commerce, and that commerce usually attracts natures incapable of theoretical investigation. Commerce requires men of action, not theorists and ideologists. Commercial pursuits were also, until quite lately, considered dishonourable; Mercury, the God of Merchants, was also the God of Thieves. Commerce was a profession for those who had failed in the schools. Intelligent sons were sent to the university, the rest to the counting-house. Such is the explanation of the startling fact that although in every other sphere science passes from triumph to triumph, we have as yet no sound definition or theory of metal money. Metal money has been in existence for 4000 years, has during a hundred generations passed through thousands of millions of hands, yet in the management of money every country in the world is guided, not by science but simply by routine. The lack of a sound theory of money is the reason why the phenomenon of interest has never been satisfactorily explained. For 4000 years we have paid and received countless thousands of millions in interest, yet science is at the present day incapable of answering the question "Whence and why does the capitalist receive interest ?" (* Boehm - Bawerk, History and Criticism of Theories of Interest.) Attempts to solve the problem of interest have not, indeed, been wanting. As an obvious disturber of the peace, interest has received a far larger share of public and scientific attention than money. All economists of note have dealt with this problem, especially the socialists whose whole effort is fundamentally directed against interest. But in spite of all these attempts the problem of interest remained unsolved. The failure is not due to the difficulty of the subject, but to the fact that capital-interest (interest on loans as well as interest on real capital) is the child or by-product of our traditional form of money and can therefore be scientifically explained only with the help of a theory of money. Money and interest, to superficial observers inseparable friends, have also a close inner connection, a connection in theory. A theory of interest can only be deduced from a theory of money. But theorists upon interest have always, for the reasons given above, neglected the study of money. Marx, for example, can never have given the theory of money five minutes attention - witness his three large volumes upon interest (capital). Proudhon under-rated money less and came nearest to solving the problem of interest. In the following investigation, begun by chance and helped by favourable outer circumstances, I now offer science, commerce and politics the long sought-for theory of money and interest. What I investigated was controversial matter. Am I to blame that what I discovered must stimulate sweeping changes in the social order ? Summer 1911 Silvio Gesell
1. HOW THE NATURE OF MONEY IS REVEALED If the inscriptions on coins are supposed to furnish information about the nature of money, it must be admitted that the information is scanty. The inscriptions run "10 Marks", "10 Francs" or "10 Roubles", and if we fail to deduce the nature of money from these words, the marginal comment "Mit Gott" or "Liberté, Egalité, Fraternité" will hardly bring us enlightenment. If we compare the present German coins with the old Prussian thalers it is noticeable that the inscription no longer states the quantity of fine metal contained in the coins. As the indication of weight was often a convenience (* The coin became a legally certified weight with which anyone could check a shopkeeper's weights. The number of coins in a sum of money could be determined by weighing, and conversely the weight of a given
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