ABSTRACT
Productive capital is struggling desperately against the liability and has no other resource than to try to provide out of its own yield the income needed to pay the interest and amortisation on it, by carrying to the utmost possible limit the technical cheapening of production. The crisis itself is to be understood as a process of capital deflation, of the elimination of surplus capital. The world's economic system is struggling instinctively—so surely as every crisis is an illness of which the purpose is to aid recovery—to eliminate the extra capital. If the unproductive loan capital is held on to, the productive capital will dwindle away. The difference in economic development with and without the War cannot be so very great."—To that one must reply: It is one of the articles of faith of the capitalist system that the formation of new capital has to come from the surpluses that are tapped from the yield of production.
