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Singing the Praises of the Beautiful Banks

The Co-operative bank has had various scandals in recent years, financial and otherwise. The Co-op 'brand' has decided it needs to clean up its image. The result is a current television advertising campaign which is as preposterous as it is insulting to our intelligence. The television ads are voiced by Russell Brand’s former radio show on-air commentator, George The Poet, who utters ponderous platitudes as if these capitalist high-street banks and supermarkets were some kind of socialist utopia. In fact, of course, today’s Co-op bears hardly even a trace of the idealism of the Rochdale Pioneers of 1844. Like the John Lewis Partnership, it has long succumbed to the pressure to act just like any other profit-hungry, hierarchical corporation within a capitalist world.

HBOS: the Horse That Bolted

In 2001 the former Halifax building society which had turned itself into a bank merged with the Bank of Scotland to form HBOS. In October 2008 HBOS failed and was merged with Lloyds Bank in which the government took a major share. The Bank of England and the new Financial Conduct Authority have now issued a 400-page report on The Failure of HBOS PLC (HBOS).

'Militant' Confusion About Inflation

The West London supporters of Militant (the Trotskyite group which still believes in infiltrating the Labour Party) have recently republished a pamphlet, which first appeared in 1977, entitled Inflation and the Financial System.

It begins by explaining, using arguments first developed by Marx in Value Price and Profit, how a rise in wages leads to a decrease in profits rather than an increase in prices and goes on to draw the correct conclusion that

“since we have a paper currency which is not convertible into gold, inflation is caused by the printing of paper money in excess of the actual requirement of circulation.”

Cooking the Books: Marx and Banks

The Morning Star (23-24 March) carried a cartoon which has Marx holding a piece of paper on which is written ‘Cyprus banks grab’. He is writing on a blackboard:  ‘Banks in Capitalist society are institutions created for the systematic robbery of the people’ and asking, ‘Now will you believe me?’

The only problem is that this is not a quote from Marx, nor does it correspond with Marx’s expressed views on banks. Marx was well aware of the opportunities for swindlers opened up by the coming of limited liability companies and their promotion, and by stock exchange manipulations in which some financiers and banks already were involved in his day, and wrote about this.

However, Marx’s whole analysis of the nature of exploitation under capitalism was that this took place in the course of production in the places where real wealth was actually produced when capitalist employers extracted surplus-value from wage-workers, not in the sphere of money and finance.

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