we reckon it in terms of
money, consists, like income, of real things; factories, machinery,
materials and the like. It is quite obvious that these things are of
use, are, indeed, indispensable for production; what more natural than
that capital should command a price? It almost seems as though we
might pass, without further ado, to a detailed discussion of the
forces which determine the amount of this price.

But this account does not bring out the essential point as brief
reference to a very famous controversy will show. Some ingenious
writers in the last century, the most notable of whom was Karl Marx,
set out to prove that, in our modern society, workpeople are
"exploited," robbed of the "whole produce of their labor," to the full
extent of the return which accrues to capital. The argument was
exceedingly complex in detail; but it boils down to this: The
factories and machinery which are admittedly essential to production
were themselves produced in exactly the same way as consumable
goods. They were produced by labor, working with the assistance of
nature, and, again, if you choose, of capital in the form of further
factories, machinery, etc. But these further capital goods can in
their turn be regarded as the product of labor, nature and capital;
and so we can proceed until it seems as though the element of capital
must disappear in the last analysis, as though labor and nature were
the sole ultimate agents of production, and the reward of capital
represented no more than the exercise of the exploiter's power. In one
form or another this argument still dominates the minds of a large
proportion of the so-called "rebels" against the existing social
order.

If we are to meet this argument, if, which is perhaps more important,
we are to understand the true nature of capital, we cannot rest
content with saying that it consists of factories and machinery, and
that these are essential to the worker. Just as it was well to get
behind the money terms, in which we often think of capital, to the
real goods; so we have now to get behind the real goods to something
else. What this something else is, the first chapter may have already
done something to reveal.

Sec.2. _Waiting for Production_. Between production and consumption there
is an interval of time. All productive processes take time to
accomplish. The farmer must plow the soil and sow the seed months
before he can reap the harvest which will reward him for his
e