"was there nothing wrong with capitalism before finance (and ‘financialisation’) emerged after the 1970s? Were there no crises of overproduction and investment, no monopolies and rent-seeking before the 1970s? Was there a wonderful productive, competitive, equal capitalist mode of production existing in the 1890s, 1930s or even in the 1960s? And why did finance suddenly emerge in the 1970s, leading to the GDP measure being altered to account for it?
Mazzucato offers no explanation of why capitalism became increasingly ‘unproductive’ and ‘rent-seeking’. But Marx’s value theory does. From the mid-1960s to the early 1980s, there was a sharp fall in the profitability of the productive sectors of all the major capitalist economies. Capitalism entered the so-called neoliberal period of the destruction of the welfare state, restriction of trade unions, privatisation, globalisation – and financialisation. Financialisation (looking to make profit from the purchase and sale of financial assets using new forms of financial derivatives) became a major counteracting factor to this fall in profitability. For capital, it was not a matter of ‘choice’ but necessity to reduce the cost of government and raise profitability, and partly through financial speculation and monopoly rent-seeking."
The value (price and profit) of everything
The value (price and profit) of everything
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