Re: [OPE] market socialism

From: Ian Wright (
Date: Tue Jul 01 2008 - 19:16:06 EDT

> The usurer of the past, or the merchant bank of today, was not
> 'postponing consumption', they were and are in the business of lending
> to make money as a business, in order to grow their capital.

Lending at the natural rate of interest by definition does not grow
one's capital.

> The distinction between equity capital and loan capital is relatively
> superficial and indicates a rather anglo saxon perspective on
> capitalism. Outside of the English speaking world, finance capital,
> rather than equity capital has been a characteristic form of ownership
> of large industry. Taken at face value, your argument would suggest
> that the classic German model of capitalism described by Hilferding
> would not be exploitative.

If I lend to you at the natural rate of interest, so you can start a
firm to produce widgets, and you pay me back in 10 years time, then
you've got a business and I have the same claim on the fruits of labour
as I did ten years ago. No exploitation here.

In contrast, if I purchase equity in your widget-firm, and in 10 years
time you've paid back my initial expenditure plus natural interest in
the form of dividends, I still have a claim on your firm's revenue
stream. I will do in-perpetuity as long as I own the shares. In this
case, I am receiving income from other people's work. So this is an
example of exploitation.

Aren't these cases different?

Isn't there an important distinction to be made between:
(i) lending money, and
(ii) having equity-capital in a firm?

ope mailing list

This archive was generated by hypermail 2.1.5 : Thu Jul 31 2008 - 00:00:08 EDT