On 3/23/07, Jim Devine <[EMAIL PROTECTED]> wrote:
"...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."
For David Shemano:
This is why I concern myself with things like banks and mortgage
lenders essentially saying: "It's not our automated tools, WE know
what we're doing!". I'm SURE they do know quite a bit about computer
modelling of 'scores' for mortgages, and automated tools for those
calculations.
However, on a 'macro' scale, I think the sociological under-pinnings
of 'greed for capital' as currently practiced leads, via some sub rosa
societally subconcious method, to mathematical models that that lead
to computer generated financial models for wealth creation leading to
sales of that software to people who expect optimized performance,
performance that intrinsically leaves out certain issues...
sustainability of the planet and the health of the planet's denizens
are two issue that immediately comes to mind.
Whether a person of color ends up with consistently higher mortgage
interest rates is another.
Another example:
Triple witching... what mayhem did institutional automated trading do
to small investors before modifications were made to how the trading
was done (staggering the trades? I don't keep up). Did the
mathematical models the institutions used ever take the effect of
small investors bailing/forced out into account? I doubt it, and only
if it optimized the calculations to improve the *institution's*
creation of wealth... or if forced to...
You could sum this up by saying: "I don't trust the people who HIRE
the math/software creators, because their vision is myopic.
Leigh
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]
