Tuesday, March 01, 2005

Profit is a dirty word

So, the HSBC bank made profits of nearly £10 billion in 2004, a record for any "British" bank (as, of course, a bank called the Hong Kong and Shanghai Banking Corporation must be). A lot of people don't like banks and assume that they make profits by ripping off their customers. No doubt, like all businesses, they do go in for this to the extent that they can get away with it, but this is not the source of their profits. Profits represent wealth (a claim on useful things) and there is only one source of wealth: the application of human labour, mental and physical, to materials that originally came from Nature. Since banks produce nothing, where do their profits come from? Where did the HSBC's £10 billion come from? There is only one possible source: the work of those who actually produce wealth. These produce surplus value for their immediate employers, a part of which is passed on to banks and other non-producing businesses performing a useful role in the capitalist economy through the averaging of the rate of profit on equal amounts of capital invested. In other words, the surplus value extracted from the immediate wealth-producers is shared out, through competition, amongst the various sections of the capitalist class. That's the source of all profits, not just those of the banks. According to today's papers Tory leader Michael Howard is too complain in a speech today that "too often in our country profit is used as a dirty word". We'd say it is not used often enough in this way since it really is a dirty word, describing as it does the proceeds of the exploitation of the class of wage and salary workers.
Nobody made this point in the various phone-in programmes that commented on HSBC's record profits, not even those who criticised them. Some callers saw nothing wrong with the bank's profits, the patriots among them saying it was a good thing that a "British company" should make profits. The critics only criticised the profits as excessive. BBC Radio 2 phoned someone they called a "socialist". It turned out to be ex-Labour MP and leader of the Militant Tendency, Dave Nellist, whose Trotskyist group has been trying to usurp our name of "Socialist Party". He wasn't against profits either; he just wanted the bank to be nationalised so that its profits could be used "for the benefit of the people". In other words, private profits "obscene", State profits OK. Or, private capitalism bad, State capitalism good. Next time the BBC want the opinion of a socialist perhaps they'll contact somebody who really is a socialist. They'd have told them that in a society based on common ownership and democratic control with production solely for use there'd be no need for banks as there'd be no need for money. And of course no profits or exploitation either.

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