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The Political Economy of Money and Finance
Thu, April 5, 2018 @ 7:30 PM - 9:30 PM
Presented by the Capital Studies Organizing Task Force
There has been much talk in recent years about the “financialization” of capitalism and the increasingly dominant and totally destructive role of money and finance. But what exactly is “financialization” and is this something truly new for capitalism or simply the latest manifestation of a phenomenon and process that has earlier historical roots and is basic and fundamental to the way that capitalism functions? And, what is the role of money and finance in 21st century capitalism?
To understand “financialization” and the pronounced instability of the world economy since the 1970s, this reading group will undertake a close reading (over 10 weeks) of Costas Lapavitsas and Makoto Itoh’s book Political Economy of Money and Finance. The book attempts to offer a systematic theoretical examination of money and finance by re-examining the classical foundations of political economy and the creator of money and assessing all of the important theoretical schools since then, including Marxist, Keynesian, post-Keynesian and monetarist thinkers.
Lapavitsas and Itoh argue that monetary and financial instability has roots in capitalist production and trade, as well as in the defects of the mechanisms of money and finance. Thus, no mix of policies can fully establish monetary and financial harmony, though different policies can significantly ameliorate or worsen instability. To sustain its central claim, the book also re-examines the historical and logical origin of money, the creation of interest bearing capital, the spontaneous emergence of the capitalist credit system, the process of capitalist crisis, and the nature and function of the central banks. In addition, by presenting insights from Japanese political economy largely ignored in Anglo-Saxon economics, the authors contribute to a radical political economy based on a thorough historical analysis of capitalism.
The Capital Studies Organizing Task Force are workers and allies who gather frequently to study the three volumes of Marx’s Capital, in order to be concrete in our analysis of capital and to better inform the class struggles against capitalists and their collaborators.