ACCUMULATING PERIPHERALS


Taibbi: skimming off the great rivers of capital by mattsteinglass
March 30, 2009, 1:22 pm
Filed under: Economics

Taibbi’s takedown of DeSantis is exactly right. One of the rightest things about it is this:

Here’s the real problem with people like Jake DeSantis. Throughout this whole period, they never were able to connect the dots — to grasp the fact that when they skimmed a million here or a million there off the great rivers of capital that flowed through their offices, that that money came from somewhere, from someone. To them, it wasn’t someone else’s money, it was just money, and why shouldn’t they have it?

Marxists used to refer to middlemen and capitalists as skimmers and parasites. (You can see the mirror image of this idea in Ayn Rand’s “looters and moochers”; she remained fundamentally Marxist in her way of thinking, though only she was capable of the amazingly unique insight that it was the ordinary working people who actually produce everything in the world who were actually “mooching” off of the capitalists.) For Marxists, a merchant who buys a piece of fruit and resells it for more money is a parasite; Marxists didn’t recognize the work of finding or creating markets as valuable work, and that’s why the stores in the USSR were empty and the goods they did have were things nobody wanted. The reaction against Marxism’s multifarious economic wrongnesses has left us allergic to any accusations that people with paying jobs in the private sector are parasites. If they’re being paid money by a private employer, the free-market ideology has axiomatically assumed, then what they’re doing must by definition be producing value.

Except it isn’t. A lot of the things people do in free-market economies are actually worthless. They just consist of getting access to money, taking it, and conning people into believing they deserve to have it or that there’s nothing that can be done to keep it away from them. The highest risk of this kind of things happens in situations where people are standing right next to the flow of vast sums of money and are able to siphon it off. I.e. the financial industry. There should be no presumption that the money earned by financial institutions has been “earned”. It’s entirely possible that any given financial institution is parasitical. That doesn’t mean we can eliminate that institution immediately; it can be dangerous to suddenly kill a parasite. Think of extracting a tick. But you wouldn’t say the tick is playing a vital role in your body’s health or that it’s entitled to the blood it’s sucking out of you.

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