TY - JOUR
T1 - The Transformation of Global Financial Power
T2 - A Binary Economics Alternative
AU - Mouatt, Simon
PY - 2005
Y1 - 2005
N2 - The control of financial resources has conferred power to people, ever since the original development of money systems. However the nature and role of this power, relative to other power sources, has been difficult to determine. This paper discusses Susan Strange?s theory of financial power, which indicates its function within present capitalist mechanics, and outlines the control of money as the primary (but not exclusive) source of power that determines outcomes and historical transition. The power of productive capitalists is seen as a secondary source to financial power since the trajectory of production is determined by the vagaries of state and market, whereas the control of money is not constrained in the same manner. The paper suggests, therefore, that the notion of finance capital is a false one since although at most times the interests of financial and productive powers converge, centred on wealth creation, this is not always the case. In times of a conflict of interest financial powers will predominate as they seek to retain their relative proportions of power in global order. Financial powers constitute, therefore, the bourgeosie of the modern era. Using these concepts the paper then investigates the binary economics of Louis Kelso as a vehicle to engender the use of financial power for the purposes of crisis prevention and even development. This involves the state issue of ?interest-free? money and the wider social ownership of capital incomes that would weaken the financial power of private bankers. Redistribution and enhanced multilateral regulatory capacity, in substantial form, are seen as desirable for the present capitalist order although it is recognised that there is neither the political will nor necessary consensus. It also ironically suggests that, at present rates of credit accumulation, debt could ultimately be replaced by redistribution as the only means of sustaining the interests of global capital and neo-liberalism. Much depends upon the agendas of the presiding financial powers.
AB - The control of financial resources has conferred power to people, ever since the original development of money systems. However the nature and role of this power, relative to other power sources, has been difficult to determine. This paper discusses Susan Strange?s theory of financial power, which indicates its function within present capitalist mechanics, and outlines the control of money as the primary (but not exclusive) source of power that determines outcomes and historical transition. The power of productive capitalists is seen as a secondary source to financial power since the trajectory of production is determined by the vagaries of state and market, whereas the control of money is not constrained in the same manner. The paper suggests, therefore, that the notion of finance capital is a false one since although at most times the interests of financial and productive powers converge, centred on wealth creation, this is not always the case. In times of a conflict of interest financial powers will predominate as they seek to retain their relative proportions of power in global order. Financial powers constitute, therefore, the bourgeosie of the modern era. Using these concepts the paper then investigates the binary economics of Louis Kelso as a vehicle to engender the use of financial power for the purposes of crisis prevention and even development. This involves the state issue of ?interest-free? money and the wider social ownership of capital incomes that would weaken the financial power of private bankers. Redistribution and enhanced multilateral regulatory capacity, in substantial form, are seen as desirable for the present capitalist order although it is recognised that there is neither the political will nor necessary consensus. It also ironically suggests that, at present rates of credit accumulation, debt could ultimately be replaced by redistribution as the only means of sustaining the interests of global capital and neo-liberalism. Much depends upon the agendas of the presiding financial powers.
M3 - Article
JO - Political Economy
JF - Political Economy
ER -