# The Social Revolution/Part 2/Chapter 2

​Here also nothing is lacking but the necessary power to bring about socialization. The victorious proletariat will furnish this power.
The expropriation of the exploiting classes presents itself purely as a question of power. It proceeds essentially from the economic necessities of the proletariat, and will be the inevitable result of their victory.
CONFISCATION OR COMPENSATION.
The question of the possibility and necessity of the expropriation of the exploiters can be answered with much greater degree of certainty than the question which naturally arises therefrom: Will the expropriation proceed as a process of confiscation or compensation; will the previous possessors be indemnified or not? This is a question which it is impossible to answer to-day. We are not the ones who will have to complete this development. It is now impossible to determine any force inherent in conditions which will make either one answer or the other necessary. In spite of this, there are, however, a number of reasons which indicate that a proletarian regime will seek the road of compensation, and payment of the capitalists and landowners. I will here mention but two of these reasons which appear the most important to me. Money capital, as already stated, has become an impersonal power, and every sum of money can to-day be transformed into money capital without the owner ​actively functioning as a capitalist. We know that when a man has saved a mark to-day he can put it out at interest without thereby becoming a capitalist. As is well known, this phenomenon has been widely utilized by the optimistic representatives of the existing order. They conclude that this gives an easy way for the expropriation of the capitalist by the laborers depositing their total of saved pennies in the saving banks or purchasing shares in the corporations with them, and thereby becoming partners in capital. At other times these optimists say that if we were to confiscate capital to-day we must confiscate not alone the capital of the rich, but that of the laborers also, in which case we would be taking away the scanty savings of the poor, the widows and the orphans. In this manner we would arouse great discontent among the laborers themselves, another reason which would tend to provoke them to the overthrow of their own domination, a result which these glorifiers of the existing order await with greatest certainty.
The first assumption I do not need to discuss further. It is too foolish. The people who expect to see capital expropriated by the increase of savings are blind to a much more rapid increase of large private capitals. On the other hand, it is not wholly unjustifiable to say that a proletarian regime pledged to universal confiscation would also confiscate the savings of small traders. That would not be ​a reason why the laborers should find their own rule unnecessary. (One must be hard up for plausible arguments against a social revolution when he makes use of such anticipations.) But it might become a reason for the conquering proletariat to stop in the confiscation of the means of production.
If, however, that should happen, one could ask. What justice has the laboring class received from expropriation? It works simply to make all capital become simple money capital; and all the capital being transformed into national, state and co-operative bonds, any surplus value which the capitalists have drawn directly from the laborers will flow to them from the nations, states and co-operatives. Is this in any way to change the condition of the laborer?
This question is wholly justifiable. But even if a proletarian regime should permit the same amount of profit to flow to capital that it had formerly received, the expropriation through a continuance of proletarian rule would have brought great advantages with it, in that a further increase of exploitation from then on would be impossible. Any new application of capital as well as every increase would be excluded together with all increase in ground rent. This alone would be a significant result of proletarian transformation. Every further increase of social wealth would from then on inhere to the good of all society.
​But together with this there would come still another advantage. As soon as all the capitalist wealth had taken the form of bonds of states, municipalities and co-operatives, it would be possible to raise a progressive income, property and inheritance tax to a height which until then was impossible. It is one of our demands at the present time that such a tax shall be substituted for all others especially for an indirect tax. But even if we had to-day the power to carry through such a measure with the support of other parties, which is plainly impossible because no bourgeois party would go so far, we would at once find ourselves in the presence of great difficulties. It is a well known fact that the higher the tax the greater the efforts at tax dodging. But when a condition exists where any concealment of income and property is impossible even then we could not be in a position to force the income and property tax as high as we wish because the capitalists, if the tax on their income or property pressed them too closely, would simply leave the State. There have already been instances of this. The State then has the income and property tax without either income or property. Above a certain measure such taxes cannot rise to-day even if we had the political power. The situation however is completely changed when all capitalist property takes the form of public debts. The property that to-day is so hard to find then lies in broad daylight. It would then only be ​necessary to declare that all bonds must be public and it would be known exactly what was the value of every property and every capitalist income. The tax could then be raised as high as desired without the possibility of tax frauds. It would then also be impossible to avoid taxation by emigration for it is then a public institution of the country and above all of the nation itself from which all interest must flow and the tax could simply be taken from the interest before it was paid out. Under such conditions it would be possible to increase the progressive income and property tax as high as desired. If necessary it might be put so high as to be equivalent, or nearly so, to a confiscation of the great properties.
It might well be asked what advantage is offered by this roundabout way of confiscation of great property instead of taking the direct road. Is it not mere jugglery simply for the purpose of avoiding the appearance of confiscation if capital is first compensated for at its full value and then confiscated through tax legislation? The difference between this mode and that of direct confiscation appears to be but formal.
But the difference is not so trifling. Direct confiscation of all capitalists would strike all, the small and the great, those utterly useless to labor and those the most essential to labor in the same manner. It is difficult, often impossible, in this method to separate the large possessions ​from the small when these are united in the form of money capital in the same undertaking. Direct confiscation would complete this quickly, often at one stroke, while confiscation through taxation permits the disappearance of capitalist property through a long drawn out process proceeding in the exact degree in which the new order is established and its benevolent influence made perceptible. It makes it possible to extend the process of confiscation over a decade so that it will only be fully operative in the new generation that will have grown up under the new conditions and is therefore not accustomed to reckon with capital and interest. Confiscation in this way loses its harshness, it becomes more acceptable and less painful. The more peaceably the conquest of the political power by the proletariat is attained and the more firmly organized and enlightened it is, the more we can expect that the primitive forms of confiscation will be softened.
I have lingered somewhat longer with this question because it constitutes one of the main objections of our opponents and not because its carrying out is the greatest difficulty that we will meet. The greatest difficulties begin rather after all of the above events. The expropriation of the means of production is relatively the simplest incident among the great transformations of the social revolution. It requires only the necessary power and it is one of the inevitable presumptions of our whole investigation. ​The difficulties for the proletarian regime lie not so much in the sphere of property as in that of production.
THE INCENTIVE OF THE LABORER TO LABOR.
We have seen that the social revolution makes the continuation of the capitalist manner of production impossible, and that the political domination of the proletariat is necessarily bound up with the economic uprising against the capitalist manner of production by which its progress is hindered. Production however must continue. It cannot pause even for a few weeks without the whole of society going down. So it is that the victorious proletariat has the imperative task of ensuring the continuance of production in spite of all disturbances, and to lead the laborer back to the factories, or other places of labor upon which they have turned their backs and to keep them there in order that production may go on undisturbed.
What are the means at the disposal of the new regime for the solution of this problem? Certainly not the whip of hunger and still less that of physical compulsion. If there are people who think that the victory of the proletariat is to establish a prison regimentation where each one will be assigned his labor by his superior then they know the proletariat very poorly. The proletariat which will then make its own laws has a much stronger instinct for freedom than any of the servile and pedantic