Jefferson's letters to Gaillatin often offer that strange, mechanical, almost binocular, insight by which one of the world's greatest hypocrites sustained his equipollence:
At home things are not well. The flood of paper money, as you well know, had produced an exaggeration of nominal prices and at the same time a facility of obtaining money, which not only encouraged speculations on fictitious capital, but seduced those of real capital, even in private life, to contract debts too freely. Had things continued in the same course, these might have been manageable. But the operations of the U.S. bank for the demolition of the state banks, obliged these suddenly to call in more than half of their paper, crushed all fictitious and doubtful capital, and reduced the prices of property and produce suddenly to 1/3 of what they had been. Wheat, for example, at the distance of two or three days from market, fell to and continues at from one third to half a dollar. Should it be stationary at this for a while, a very general revolution of property must take place. Something of the same character has taken place in our fiscal system. -- Dec. 26, 1820
Interesting that Jefferson calls the outcome of deflationary trends a "general revolution", especially seeing that he would not have used the term lightly since he knew that his entire legacy would rest solely on the continuing stature of the concept of "revolution." He reveals a bit more about the precise mechanics of such a revolution nearly twenty years earlier, in another letter to then-treasury secretary Gallatin:
I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs. --
1802
Jefferson is so clearly describing the current situation, in the same terms which are used today, that it needs almost no explanation. So absolute are the correspondences, that all we need say is that the "false capital", at our particular moment, masks housing, while threatening to extend its aura to commodities. Again, there is a spectre of scarcity and depletion (or value) where there is plenty (the housing market is in fact overbuilt, commodities are produced in absurd excess). Jefferson has here exceeded himself, and the whole earth on which the game of capitalism stands, by accidentally calling into question the existence of true capital. The "aura" of "false capital", which is nothing other than the anxiety of privation (an over-determination of nothingness) and its corresponding predatory drives, threatens to create a perpetual debt which will, he thinks, accumulate property in the hands of a few bankers: a capitalist "general revolution" which will leave homeless those (genocidal maniacs) who conquered the Continent. Fool though he may be, Jefferson was always a thinker of growth (intensive and expansive) and was never an economist, and only rarely allowed himself the luxury of openly dialectical thinking. Is this in part because he knew that "general revolution" had even further, unforeseeable affects, beyond the apparent accumulation of all property in the hands of a few bankers? What, for instance, happens to Jefferson's libertarian-agrarian post-slavery utopia when markets deflate to zero, or near zero? When the bankers begin to cannibalize each other, as in the margin calls Jefferson describes in 1820 or the Carlyle collapse of last week, it is far from clear that the end product is "true capital" accumulation among "true capitalists" (see earlier post on "America's Communist Landlords"). The problem with any economic thinking (revolutionary, distopian or otherwise) is the fabulation of competent "agents" with the technical ability to perform a "general revolution of property." This is not the way history lives. Technicity itself lives a much more active and fearless life than any agent of capital; and so little is known of it that we can only say that it is the name of the deflation that always exhausts and infinitley exceeds the anxiety that inflates the world to "value" through the terror of its loss.
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