2010s >> 2018 >> no-1361-january-2018

Cooking the Books: The Money Shuffling Business

There is trade and trade. Trade in tangible things – what most will understand by ‘trade’ – and trade in services. This was brought out by a news item in the Times (6 November):

‘Data published by the Office for National Statistics last week showed that Guernsey, with a population of 63,000, was one of Britain’s largest international trade partners and the sixth-largest consumer of British services, putting it ahead of major economies including Italy, China and Japan’.

In other words, the UK exports more services (not tangible goods of course) to the island than it does to the other countries mentioned. According to the statistics, export of services to the Channel Islands, the Isle of Man, the British Virgin Islands and the Cayman Islands accounted in 2006 for 11 percent of all such exports.

What are these services? The ONS lists 52 of them, but excludes travel, transport and banking. On the list some such as technical advice on production are useful in themselves. Most are only useful in a capitalist society and some only to capitalists and capitalist corporations: accounting, advertising, market research, management consultancy, public relations, legal services, leasing, financial services, merchanting.

As sales of technical advice on how to grow potatoes, tomatoes and flowers must be rather limited, it is not difficult to guess what the ‘trade’ in ‘services’ with Guernsey will be. And why. In a word, tax-dodging.

That some capitalists and corporations don’t pay their fair share of taxes compared with other capitalists and corporations is not really of concern to socialists or to the wage and salary working class generally. But it does expose the hypocrisy of those who preach patriotism to the workers while in practice being, as they used say of the Northern Ireland Protestants, more loyal to the half-crown than to the Crown.

Trade is a buying and selling transaction but what is traded doesn’t have to be tangible. Anything – in fact everything – can be bought and sold and, under capitalism, is. Some services such as health care, education and entertainment are useful in themselves, even though corrupted by being sold. Other services – all those concerned with money – are useful only under capitalism. They would not make sense in a socialist society.

In fact, there would not be any trade or trading in socialism. There won’t need to be as what is produced will be the common property of society and will just need to be moved from where it is produced to where it is needed (actually, technically this is still part of production). So, goods will still be moved from one part of the world to another. This won’t be trade because no equivalent will have to be moved in the opposite direction. If people in some part of the world need farm machinery it will simply be shipped there. The same goes for food or minerals that can’t be grown locally. There will be no expectation that something has to be shipped back in exchange. No doubt people will move from one part of the world to another to provide services like technical advice, training or health care. Once again, in exchange for nothing.

All the financial services necessary under capitalism – and the vast waste of resources and work involved in them – will disappear. The people of Guernsey will be able to give up shuffling about paper claims to wealth and concentrate on doing something useful, sure in the knowledge that, as with all communities, they will be provided with all the things they can’t produce locally.

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