On Dec 22, 2008, at 11:16 AM, Louis Proyect forwarded a piece by Stephen Mihm:
Thanks for re-posting this, Lou. The current mess - fraudulent boom followed by crushing bust - is as American as gun violence.
Re: this quote...
Perhaps the current wave of debt machinations will end badly. Then again, in the long run, it may not. Consider the impressions of another novelist, the British writer Frederick Marryat, who visited the United States in the wake of the panic of 1837. As he surveyed the wreckage of broken banks and worthless paper, he came to a surprising conclusion. “If all the profits of the years of healthy credit were added up,” he wrote, “and the balance sheet struck between that and the loss at the explosion, the advantage gained by the credit system would still be found to be great. The advancement of America depends wholly upon it. It is by credit alone that she has made such rapid strides, and it is by credit alone that she can continue to flourish.”
...a gloss from Capital, vol. 3 (somewhere around p. 570 of the Vintage/NLB edition):
"[Credit is T]he principal lever of overproduction and excessive speculation in commerce, this is simply because the reproduction process, which is elastic by nature, is now forced to its most extreme limit; and this is because a great part of the social capital is applied by those who are not its owners, and who therefore proceed quite unlike owners who, when they function themselves, anxiously weigh the limits of their private capital. This only goes to show how the valorization of capital founded on the antithetical character of capitalist production permits actual free development only up to a certain point, which is constantly broken through by the credit system. The credit system hence accelerates the material development of the productive forces and the creation of the world market, which it is the historical task of the capitalist mode of production to bring to a certain level of development, as material foundations for new forms of production. At the same time, credit accelerates the violent outbreaks of this contradiction, crises, and with these the elements of dissolution of the old mode of production.... The credit system has a dual character immanent in it: on the one hand it develops the motive of capitalist production, enrichment by the exploitation of others' labour, into the purest and most colossal system of gambling and swindling, and restricts ever more the already small number of the exploiters of social wealth; on the other hand however it constitutes the form of transition towards a new mode of production. It is this dual character that gives the principal spokesmen for credit, from Law through to Isaac Péreire, their nicley mixed character of swindler and prophet."
_______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
