Lampado said, “Thasius?”
A keen-eyed, overly heavy man who seemed even more uncomfortable in his toga than the others leaned forward. “We understand that this planet Avalon has a surplus of columbium. Frankly, Amazonia is largely lacking in this element and we had about decided to find an alternative. Our steel industry has utilized it in the preparation of stainless steel to prevent corrosion at high temperatures and to permit fabrication without added heat treatment.”
Guy nodded thoughtfully.
Thasius said, “Do we understand that this Avalon has extensive deposits of niobite, the ore from which columbium is extracted?”
“Extensive,” Guy repeated. “Far beyond her own needs.”
“Very well,” Lampado gruffed. “And we understand her own need is for titanium.”
Guy nodded. “Correct. Although titanium, of course, is one of the most common elements there are comparatively few, especially on Avalon, ores bearing it that are worth the extraction. Could you inform me which you have, here on Amazonia?”
Thasius said, “We have ilmenite, rutile, arizonite and particularly perovskite. Titanite, too, but not in particularly large quantities.”
Guy said, “It’s not part of my assignment to explain Avalon’s need of titanium, but aside from its more usual uses, she has been turning out gem stones from it in remarkable quality and quantity and has been trading them throughout the confederation.”
Lampado said, “Well, there seems little doubt here. We can supply an almost unlimited amount of titanium, in ingots, of course, and can take as much columbium as Avalon is likely to be able to export. What else is there to discuss, Citizen Thomas?”
Guy cleared his throat. “Possibly the most important facet of all. The basis of exchange. How are we to evaluate your titanium as compared to Avalon’s columbium? I might suggest you put it all in the hands of the planet Geneva, which specializes in just this sort of clearinghouse problem. Her medium of exchange is gold. It would be up to the Geneva experts to work this out in detail with you both, but I understand that what it amounts to is that, on paper, she buys your titanium for gold, at the going interplanetary rate, and Avalon’s columbium. She then sells you Avalon’s columbium for gold, and sells Avalon your titanium for the same medium. Actually, of course, it is mostly paperwork. The gold never leaves the vaults of the planet Geneva.”
They were staring at him.
Lampado blurted, “Why?”
Guy said, “I beg your pardon.”
She demanded, “What does this parasite of a planet, this Geneva, get out of the deal?”
“Oh,” Guy said. “Well, I understand it’s based on volume. In this case, I doubt if they would require more than one percent”
Lampado rumbled in disgust, “Aeasus?”
Aeasus was rubbing the side of his face as though in confusion. He said, “See here. Why don’t we trade with Avalon, even-steven? What is the need for this intermediary?”
Guy looked at him blankly. “You’ve got to have some exchange medium in common. Avalon’s is based on platinum. One of the few in the system. I confess, I don’t quite understand your own, but I assume it conflicts. What do you mean even-steven? Columbium is considerably more valuable than titanium. You certainly wouldn’t expect to trade a ton of your titanium for a ton of columbium. The Avalonians aren’t drivel-happy.”
“Of course not,” Aeasus said reasonably. “Our medium of exchange is the hour. Actually, so is their’s ultimately,. Their platinum is actually valued, as an exchange commodity, according to the number of hours it takes to produce a given amount.”
Oh, oh. He had run into this before. Who from? Teucer, the refugee revolutionist from Lybia. Guy scowled.
Aeasus said, “We propose to exchange with Avalon, hour for hour. The amount of man hours it takes to produce a ton of titanium will be traded for the amount of columbium that can be produced in that time.”
Guy gave a quick shake to his head. “Look,” he said. “Suppose they have a higher degree of automation than you. Suppose in their niobium reducing plants only half a dozen men are required. In a hundred hours they could reduce one hell of a lot of columbium, but by your way of figuring it would be worth much. Suppose on the other hand, a lot of your mining and smelting is manual. Can’t you see, it wouldn’t be fair?”
“Not at all,” Aeasus said, still reasonably. “The time expended in inventing, designing and building their automated plants would, obviously, be considered in the number of hours involved. Depreciation of plant is obviously a very important part in adding up the hours necessary to produce a given amount of columbium, or any other commodity. If our extraction of titanium was done by the primitive methods you suggest, then little plant would be involved, but actually, we too have automation.”
Guy was trying to assimilate it.
Aeasus pressed on. “The exchange value of any commodity is determined by the socially necessary number of hours required to produce it.”
Guy said, “Look, just about everybody else seems to think the exchange value of a commodity is determined by supply and demand.”
Aeasus shook his head, as did all the others around the table.
“If that were so, what would happen when supply and demand equalled each other? Would the value simply disappear? Obviously not. Supply and demand can effect temporarily the price of a commodity, but not its real exchange value. And its price tends to average out at its real value.”
Lampado put in with a snort, “Can’t you see? If exchange value depended only on arbitrary prices set artificially, what you would continually win as a seller, you would lose as a buyer. We’d have a picture of two persons in the bottom of a well, selling hats to each other and both getting rich.”
Guy said suspiciously, “Something is coming back to me. The so-called Law of Value. Wasn’t it originally dreamed up by Karl Marx, a long time ago?”
“Marx?” Aeasus said frowning. “Oh you mean the 19th Century economist? No, actually the theory was first developed in 1721 by a young man named Benjamin Franklin in his first essay entitled, A Modest Enquiry into the Nature and Necessity of a Paper Currency. He used wheat and gold as examples, pointing out that if the same number of hours of work were involved in producing a quarter of wheat and an ounce of gold, then they were equal in value. A good many of those who came after Marx gave him credit for, or blamed him for, various teachings that never originated with the man. In fact, there are few scholars in history whose teachings have been so completely distorted—especially by his supposed followers.”
“All right,” Guy said. “Lets leave that for a time. How about this? How can you simply add all the hours together in a lump? Take your titanium production. Out in the mines you’ve got a man…” he cleared his throat “…or woman. A big brawny type. Bucking a drill. Back at the plant you’ve got a chemist who’s running tests on the final product. This chemist spent ten years in school after the brawny yoke dropped out. He’s trained. He’s spent the better part of his youth getting that training. He’s of more value to society than the drill bucker!” His voice had gone slightly high.
Actually, of course, the whole thing meant little to Guy Thomas and his real assignment. The Avalonians actually did wish to trade titanium for their surplus columbium but this expediter nonsense was a front. However, the argument was getting to him, adding to the frustration he was finding everywhere on this madhouse planet.
Aeasus said, “But obviously when the yoke, as you call him, dropped out of school, he went into his chosen field, mining in this case, being paid the number of hours he expended. Your chemist continued in school for as long as he wished, so long as he could pass the examinations. When he finally finished his education, he too went to work in the titanium industry.”