I wrote:
if "wealth" refers to exchange-value, financiers do not create it (according to Marxian political economy). All they do is transfer property rights from one person to another, rather than creating new exchange-value -- or surplus-value. The financiers are able to slice off a piece of the surplus-value pie without expanding the pie's size. Value and surplus-value, on the other hand, are produced by labor that produces new products (goods or services) that are sold on the markets rather than transferring legal claims to products among individuals.It might be argued in reply that financial intermediation (as opposed to its absence) allows capitalism to be more prosperous, producing more value and surplus-value and/or allowing greater realization of that value and surplus-value.("Financial intermediation" refers to the provision of use-values of the sort described in my first paragraph above.) That is, by greasing the wheels of commerce, financiers allow the GDP to be larger than it would be in their absence. If this argument is true, it only says that financiers are productive _in capitalist terms_. It does not say that financiers benefit the human race in human terms. Capitalist terms -- measured by such things as GDP -- ignore all sorts of costs to humanity such as pollution, the destruction of communities, and social inequality. GDP also ignores benefits (use-values) that are not provided in a capitalist way.
I left out crucial parts. It may be very possible to have financial intermediating (transferring money from those with excess funds to those who want to borrow it) without paying interest or outrageous financier salaries & fees to get it done. Even within capitalism, this may be possible, since a lot of the transfers of ownership claims among individuals is unnecessary (even to capitalism) and absolutely wasteful (as with speculative bubbles). A marginal move in this direction would be a Tobin tax, where there would be a tax on each financial transaction, slowing down or even preventing bubbles. Further, if we are able to get beyond capitalism, we will need investment planning to serve the democratically-decided public interest rather than the individual greed-driven capitalist interest as we see it now. The problem with capitalist financial intermediation (as I did note) is that it is "productive" only in capitalist terms (if it is that at all). But we want the system to be "productive" in socialist-democratic terms, we cannot organized financial intermediation in a capitalist way. Some sort of scheme like that of Charlie Andrews in his FROM CAPITALISM TO EQUALITY appeals to me, though more democratic control over the investment planning process seems needed. -- Jim Devine / [this space for rent]
