r
billion dollars has been produced. How much of this can labor buy
back? Two billions. There is no discussion of this, I am sure. For that
matter, my percentages are mild. Because of a thousand capitalistic
devices, labor cannot buy back even half of the total product.

"But to return. We will say labor buys back two billions. Then it stands
to reason that labor can consume only two billions. There are still two
billions to be accounted for, which labor cannot buy back and consume."

"Labor does not consume its two billions, even," Mr. Kowalt spoke up.
"If it did, it would not have any deposits in the savings banks."

"Labor's deposits in the savings banks are only a sort of reserve fund
that is consumed as fast as it accumulates. These deposits are saved
for old age, for sickness and accident, and for funeral expenses. The
savings bank deposit is simply a piece of the loaf put back on the shelf
to be eaten next day. No, labor consumes all of the total product that
its wages will buy back.

"Two billions are left to capital. After it has paid its expenses, does
it consume the remainder? Does capital consume all of its two billions?"

Ernest stopped and put the question point blank to a number of the men.
They shook their heads.

"I don't know," one of them frankly said.

"Of course you do," Ernest went on. "Stop and think a moment. If capital
consumed its share, the sum total of capital could not increase. It
would remain constant. If you will look at the economic history of
the United States, you will see that the sum total of capital has
continually increased. Therefore capital does not consume its share. Do
you remember when England owned so much of our railroad bonds? As the
years went by, we bought back those bonds. What does that mean? That
part of capital's unconsumed share bought back the bonds. What is the
meaning of the fact that to-day the capitalists of the United States own
hundreds and hundreds of millions of dollars of Mexican bonds, Russian
bonds, Italian bonds, Grecian bonds? The meaning is that those hundreds
and hundreds of millions were part of capital's share which capital
did not consume. Furthermore, from the very beginning of the capitalist
system, capital has never consumed all of its share.

"And now we come to the point. Four billion dollars of wealth is
produced in one year in the United States. Labor buys back and consumes
two billions. Capital does not consume the remaining two bil