Alfred Amonn: Review of Rudolf Kaulla’s Rechtsstaat und Währung (1951)

Alfred Amonn’s journal book review presents Rudolf Kaulla’s Rechtsstaat und Währung as a theory of modern money grounded in legally enforceable claims. Moving from monetary history through the nature of value measurement to the consequences of devaluation, Amonn reconstructs Kaulla’s “compensation theory” and concludes that it deserves attention from both economics and jurisprudence. The review’s central concern is the connection between monetary arrangements and the protection of creditors under the rule of law.

Kaulla’s historical argument turns on the transformation of offsetting monetary claims. What had long been a voluntary transaction became a legal institution generally applicable unless legislation or agreement provided an exception. This change gives claims themselves a monetary function:

Alle fälligen Forderungen auf Landeswährung sind nun mit gesetzlicher Zahlkraft ausgestattet gegenüber allen andern ebensolchen Forderungen, denen sie gegenübertreten.

English translation: All claims payable in national currency that have fallen due are now endowed with legal payment power against all other such claims against which they are set.

The decisive development is therefore not simply the growth of cashless payments. Amonn reports an inversion of the established hierarchy: settlement money has become the principal form of money, both quantitatively and legally, while coins and notes serve where settlement through claims is unavailable. Calling cashless instruments mere substitutes for “real” money no longer captures their status.

The review next explains the relation between claims, their objects, and the monetary unit. Offsetting requires claims directed toward like objects; gold’s fungibility makes it particularly suitable and facilitates international use. Under a gold currency, however, the unit is a claim to an abstractly fixed quantity of gold, rather than gold considered simply as a commodity. Monetary claims stand in stable relations to this unit and consequently to one another. Amonn identifies the conceptual distinction on which Kaulla’s account of measurement rests:

Diese und nur diese Stabilität ist nötig, aber auch genügend, um die Forderungseinheit zu einem zuverlässigen Wertmaßstab zu machen.

English translation: This stability, and only this stability, is necessary, but also sufficient, to make the unit of claims a reliable measure of value.

Such internal stability does not entail constant purchasing power. A measure requires stable relations between its parts and its own unit, not an unchanging relation to everything measured. This separates the reliability of the monetary unit from fluctuations in gold’s exchange value.

Kaulla then locates changes in the value of settlement money in the creditworthiness of debtors. Declining state credit can reduce the purchasing power of claims against the state without reducing gold’s own purchasing power. Even fear that public finances cannot cover obligations may raise the general price level. Devaluation, commonly used to address such developments, is consequently a redistribution through the reduction of debts:

Eine solche Abwertung bedeutet eine allgemeine Schuldenherabsetzung, die unterschiedslos allen denjenigen zugute kommt, die in dem gegebenen Augenblick das Glück haben, Geld schuldig zu sein.

English translation: Such a devaluation means a general reduction of debts that indiscriminately benefits all those who, at the given moment, have the good fortune to owe money.

Creditors correspondingly lose, except where special measures protect particular categories. The contrast with private debtors sharpens the criticism: individuals are expected to make every possible sacrifice before reducing payments, whereas governments may create a monetary fait accompli through administrative action without necessarily securing prior parliamentary approval.

Amonn’s closing comparison gives the theory its intellectual position. Against metallism, Kaulla identifies the claim to gold, rather than gold itself, as the bearer of monetary value. Against nominalism, he insists that a monetary claim possesses value of its own and merits state protection like other legal rights. Amonn accordingly calls the compensation theory a rule-of-law theory of money, contrasting it with Knapp’s “state theory.” The review’s relevance lies in this conjunction of monetary analysis and legal accountability: how politicians judge devaluation, and how courts address its individual consequences, reveals whether state monetary power respects enforceable rights or operates arbitrarily.