A PERSPICACIOUS cRTInC remarked of this essay in an early version: It tells us more about what radical economists do than what radical is. While I hope this is less true of the present version, Professor Jacob Viner was right in arguing that economics is what economists do, especially when the in question is inchoate, unstructured, and still developing, as is decidedly the case witlh the American radical variety.

WITH THE STUDY OF problems of capitalization, credit, and discount, the peaceful parade of equationally determinate barter economy' comes to an abrupt halt. The systems of equations expressing the conditions of equilibrium theory differ in number from the unknowns to be determined. Equational determinacy is established only by the introduction of money into the system. This conclusion is, I believe, novel in general-equilibrium theory. It is an obvious confirmation to an essentially monetary theory of interest-as distinguished from a real capital theory admitting of short-run monetary dislocations. In its support, demonstration of the following subordinate propositions will be attempted: In a static, but not stationary,2 barter economy it is necessary, first, to posit a plurality of interest rates in order to secure the equality of demand and supply of loans for each of the various goods and services lent in natura.3 It is necessary, second, to provide for yet another plurality of discount rates, to take account of the loan aspect of payments for services made at times other than those at which their final products are sold. It is necessary, third, to establish various fixed relationships, which I call capitalization rates, between the prices of services and the prices of the goods which are their sources, so that individuals may be able to choose rationally between the purchase (sale) of the goods and the purchase (sale) of the services. Under barter, there are no clear interrelationships between these various rates. The lack of interrelationships renders indeterminate each of the three

T HE Commission on Money and Credit has laid its 285-page egg 1 and gone over like a lead balloon -choose your own metaphor with both the economists and the general public. Certain of its administrative suggestions, notably those involving reconstitution of the Federal Reserve System's Board of Governors, have attracted a significant modicum of attention.2 On the substantive side, however, the Commission's main body of work appears already spurlos versen,kt, in unhappy contrast with both the National Monetary Commission of fifty years past, whose influence it was intended to rival, and the Radcliffe Report of I959,3 its closest contemporary transatlantic equivalent. This unhappy fate rather befits a series of attempted least common denominators between unreconciled and possibly unreconcilable special interests, which turned out to be meaningless verbal compromises as often as anything more. Indeed, the least uninteresting feature of the report to this reader was the triangular running battle between the predominantly sound don't rock the boat position of its text and the two accompanying sets of mutually contradictory footnote dissents. Set i, contributed primarily by the labor bloc (Lubin, Nathan, Rieve, Ruttenberg, and Thorp, with Ruttenberg the principal spokesman), stands for guaranteed full employment and a 5 per cent annual growth rate, at any cost in direct controls over everyone but organized labor, and over everything but wages. Set 2, contributed by a mixed bag of business, finance, and agricultural4 spokesmen (Black, Lazarus, Miller, Schwulst, Shuman, Thomson, and Yntema) stands for Free Enterprise in the economic aggregates -McKinley minus the gold standard.5 Rather than aim a supernumerary nail at the Commission's coffin, I propose to examine a biased sample of the professional papers submitted for the Commission's use, and to all appearances neglected by the Commission in favor of cliches and weasel words masquerading as common sense.6 The papers are to an econo-