Abstract
The study of banking and finance in developing countries has historically been dominated by mainstream economists working within a neoclassical approach, and preoccupied with the financial sector’s capacity to mobilise savings for the development of a ‘modern’, i.e. capitalist, economy. In the neoliberal era, this approach has focused on issues such as privatisation, the development of financial markets, and the management of financial liberalisation, both domestic and international.
Against this background, Marois’s study of banking and finance in Mexico and Turkey provides an excellent corrective, for he combines a detailed knowledge of recent developments in the two countries with an original critical perspective on the neoliberal promotion of ‘emerging economies’ and their incorporation into global finance. The first two chapters set out his general argument about emerging finance capitalism (hereafter EFC), and Chapter 3 gives historical background on the two countries studied. Chapters 4 and 5 then look at the transformation of banking and the wider economy in the 1980s and 1990s in each country, leading up to the crises of 1994 (Mexico) and 2000 (Turkey). Chapters 6 and 7 then analyse in detail the emergence of a distinctive finance capitalism in each country thereafter, while Chapter 8 then summarises the research and briefly proposes alternative courses of action aimed at subordinating finance once more to social goals.
Anyone looking to understand the changes in Mexican and Turkish capitalism over recent decades will find here an account that, while focused on banks and financial capital, situates them fully in the wider context of neoliberal transformations. But States, Banks and Crisis is also important for the whole political economy community, for Marois’s account offers the prospect of resolving many of the obstacles that we have faced during the long retreat of the left.
First of all there is the question of the state and its relation to capital and to markets. While it has happily become commonplace in Marxism to reject mainstream analyses that counterpose states and markets, the question of how their relationship is to be specified has been strongly contested. Many of us have remained preoccupied with the rights and wrongs of major contributors on this issue such as Gramsci and Poulantzas, but Marois does not get bogged down in such arguments, focusing instead on what we can call the historical sociology of the state: the investigation of institutional change in the ways in which states serve the interests of capital. Without denying the need for theoretical debate, he does not feel it necessary to take sides over concepts such as ‘relative autonomy’ or ‘depoliticisation’. The value of his approach is evident in his treatment of bank ownership, where he shows that the role of state ownership during the period under study signals a choice of nationally appropriate political strategy for financial capital, rather than a systemic challenge to it.
Second, this book signals, surely, the end of the debate over whether globalisation has taken place. Marois shows the fundamental unity, in discourse and in practice, that has been forged between ‘the national’ and ‘the global’: financial sectors and states (here in the Turkish and Mexican cases) have conjoined an increasingly imperative global requirement to allow the free movement of capital and commodities to the specific national circumstances generated by long-run uneven capitalist development.
Third, this approach is exemplified specifically in the analysis of the financial institutions and policies that have formed EFC. As with theories of the state, Marois does not allow the continuing arguments over the legacy of Hilferding to muddy the waters. EFC ‘is defined by the structural primacy of money and credit in the circuits of production and circulation alongside the structural inequality between financial capital and labour’ (p.129). ‘Financial capital’ is not equated with Hilferding’s specific institutional form of ‘finance capital’, in which rentiers (money capitalists) directly dominate entrepreneurs (productive capitalists) through ownership; rather, it consists of businesses, especially banks, which deploy loan capital in order to reap a share of the surplus value produced by workers. Through the case studies, he shows how developmentalism, in what we used to call the Third World, has been supplanted by a capitalism that has been institutionally and ideologically rebuilt around the specific interests of financial capital.
Fourth, although labour does not appear in the title of the book, it plays an important part in the analysis. Overall, productive labour is understood as the source of financial capital, and the political development of EFC unfolds in terms of class power and class struggle. Within the banking sector, Marois places unprecedented emphasis on the labour of bank workers as a source of profit and of competitive advantage, while he also recognises the significance of lending to workers’ households, and the sale of financial services to them, in extending the grip of financial capital.
Although this book represents in these and other ways a very important advance for critical analysis, there is certainly scope for extending it in several directions. First, it needs to be combined with a detailed analysis of production under EFC. We need a parallel re-examination of changes in both the international division of labour, and labour processes and labour representation within particular economies, sector and firms. A second and related major need is for a fuller analysis of the changes in class composition and class consciousness in the transition from underdevelopment to EFC. Here, we need a better understanding of the continuing political weakness of conventional trade union organisations, as well as the powerful ideological appeal that EFC now holds for the so-called ‘new middle classes’: the educated professionals, managers and skilled workers whose protests are now being heralded as potential sources of change in the Middle East and Latin America.
The brief sketch that Marois offers of alternatives to EFC in the concluding chapter distinguishes carefully between merely a modified and less extreme version, and a real break with capital’s rule. In this way, he confirms the great merits of his analysis, but also reveals clearly the enormity of the task before us.