And of the works of the authors themselves

485

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Luiz Felipe Bruzzi Curi_Danilo Barolo Martins de Lima

of writings, one is particularly relevant for our purposes: 

the letters to von Kirchmann, as they certainly circulated 

in early 20

th

-century Brazil, but probably not in the 

English translation of 1898. In 1899 Adolph Wagner and 

Teophil Kozak published a separate edition of the fourth 

letter to von Kirchmann in Berlin, titled Das Kapital. 

This edition was in turn translated into French (Le 

capital) and reprinted in 1904 by the renowned Parisian 

publishers “Giard & Brière”. The translation eventually 

reached Brazil, as attested by the presence of an exemplar 

in the library of the São Paulo Law School.

13

The theory of “commercial crises” (Handelskrisen), 

sketched by Rodbertus (1971 [1854], pp. 38-39) in his 

contention with Kirchmann, constitutes one of the 

most relevant contents of this book. It is a theoretical 

framework which places particular emphasis on  

the behavior of wages, proposing in the end a 

redistributive solution. Kirchmann supposedly saw 

overproduction crises – situations in which the 

population endures scarcity, while capitalists accumulate 

stocks – as a consequence of the avarice of employers, 

who would not equitably share the “returns to capital” 

(Kapitalzins), because they would pay extremely low 

wages. Rodbertus challenged this idea, attributing the 

cause of such crises to a disruptive tendency inherent  

to the free market economy.

Our commercial crises, in a word, are not 

the fault of one social class, but rather an 

intrinsic problem, immutable in a circulation 

left to its own fate. Crises are the paroxysm 

of the failure that stands out in the current 

economic organization: productivity can 

grow at any rate, while the shares of national 

output corresponding to wages tend do 

decrease. 

(RODBERTUS, 

1971

 [

1854

], p. 

63

)

According to Rodbertus, economic crises derive from the 

fact that the share of wages in national income decreases 

over time, as capitalism develops. This would make the 

mass of proletarians unable to consume the output of 

their own labor, which would result in a situation of 

overproduction and under consumption, followed by the 

accumulation of unsellable stocks.

In current conditions, i.e. given the 

expansion of the free trade principle to the 

determination of the wage rate and provided 

that productivity is increasing, is the wages 

share in income stable? Given this order –  

or disorder – of things, does not the share 

pertaining to the largest part of society, the 

laboring class, decline, as productivity grows? 

(RODBERTUS, 

1971

 [

1854

], p. 

58

)

The fact that productivity grows while the wage share 

declines is ascribed to the “expansion of the free market 

principle” to wage bargaining. In other words, if there is a 

free labor market, capitalists would pay the lowest wages 

possible. The solution to this problem would include 

redistributive policies that should make the wages share 

in output increase proportionally to the productivity 

of labor, which tends to increase continually. The State 

would play an important role in this redistribution. 

Simonsen attributed to Rodbertus an important revision 

of Smithian economics, as he recognized the State as an 

important aspect of the social division of labor.

Rodbertus, resuming the study of the division 

of labor, which, according to the theory of the 

classics, constitutes the basis for commercial 

expansion, placed this great conception 

of Adam Smith in its proper terms, in an 

---

Roberto Simonsen and the Brazil-U.S. Trade Agreement of 1935 

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486

endeavor to emphasize its social aspect, 

the organic basis of States, their process of 

historical formation and the preponderant 

part which was reserved to them in the 

exercise of social rights. 

(SIMONSEN, 

1935

, pp. 

8

-

9

)

It is important to underline that Simonsen read 

Rodbertus rather selectively. Although Simonsen 

emphasized the fundamental role played by the State in 

the promotion of social rights, he did not support the 

idea that income redistribution should be a priority of 

economic policy. On the contrary, for him the Gordian 

knot of the Brazilian economy was the very low  

quantum of wealth generated – and not the unfair 

distribution of this wealth.

14

According to Schumpeter, Rodbertus’ works 

experienced a revival in the last two decades of the 19

th

 

century because of the strong support given to them 

by Adolph Wagner, another German author quoted by 

Simonsen in his speech. Indeed, as the recompilation 

published in 1971 shows, some of Rodbertus’ writings 

were re-edited by Wagner in the 1890s.

15

In his 

Grundlegung, Wagner cited Rodbertus many times, 

making particularly favorable references in the sections 

in which he developed his concept of national economy.

Simonsen praised Rodbertus for a correct approach 

to the Smithian principle of the division of labor, 

including the State in the scheme, as a promoter of 

social rights. Wagner in turn appeared in his speech 

as the economist who had the best definition of the 

idea of “national economics”, understood here as the 

science devoted to the study of the national economy: 

“It was Adolph Wagner in his ‘Fundamentals of Political 

Economy’ who first and best established the conception 

of national economics, of national capital, of national 

income”. (

SIMONSEN

, 1935, p. 9)

Adolph Wagner (1835-1917), a German economist, was 

part of the group that became known as “socialism of the 

Chair” (Kathedersozialismus), composed, according to 

Schumpeter, by politicians and progressive intellectuals, 

who advocated social reform and denounced the 

tendencies that hindered it. As Gustav Schmoller, Wagner 

participated in the Verein für Sozialpolitik (Society for 

Social Policy), an association that gathered the most 

important economists in Bismarckian Germany. Though 

members of the same institution, the relationship 

between Wagner and Schmoller, the leader of the second 

generation of the German Historical School, was not 

marked by intellectual agreement. Wagner was more 

prone to theorization than his historicist colleagues. 

Monetary theory and public finance were the fields 

in which Wagner became an international authority. 

His most relevant work, from a theoretical point of 

view, was the Grundlegung der politischen Oekonomie 

[Fundamentals of political economy], published for the 

first time in 1876.

16

This book received a French translation in 1909  

[Les fondements de l’économie politique], which eventually 

reached Brazil. It is worth remembering that French was 

a language of international scientific communication 

at the time: a significant part of the foreign economic 

literature appropriated by Simonsen and his 

contemporaries circulated in Brazil in French editions.  

Furthermore, both Wagner’s Grundlegung and Rodbertus’ 

Kapital were edited in France by the publishers 

V.

  

Girard & E. Brière, who played an important role  

in the dissemination of international economic literature 

in early 20

th

-century Brazil.

17

 

Even though Simonsen 

did not scrutinize Wagner’s writings analytically in his 

speech, he did mention Wagner’s name and referred  

to the concept of national economy, central to Wagner, 

---