Editing Finance capitalism (section)

==Historical developments==
[[File:Rudolf Hilferding and Gattin, cropped.jpg|thumb|[[Rudolf Hilferding]] is credited with first bringing the term finance capitalism into prominence.]]

[[Rudolf Hilferding]] is credited with first bringing the term finance capitalism into prominence, with his (1910) study of the links between German trusts, banks, and monopolies before [[World War I]]. Hilferding's ''Finance Capital'' (''Das Finanzkapital'', Vienna: 1910) was "the seminal Marxist analysis of the transformation of competitive and pluralistic 'liberal capitalism' into monopolistic 'finance capital'",<ref>Robert Bideleux and Ian Jeffries, ''A History of Eastern Europe: Crisis and Change'', Routledge, 1998. {{ISBN|0-415-16111-8}} hardback, {{ISBN|0-415-16112-6}} paper. p. 356.</ref> and anticipated [[Vladimir Lenin|Lenin]]'s and [[Nikolai Bukharin|Bukharin]]'s "largely derivative" writings on the subject.<ref>Bideleux and Jeffries, p. 361.</ref> Writing in the context of the highly [[cartel]]ized economy of late [[Austria-Hungary]],<ref>Bideleux and Jeffries, p. 357–359.</ref> Hilferding contrasted [[monopoly|monopolistic]] ''finance capitalism'' to the earlier, "competitive" and "buccaneering" capitalism of the earlier [[economic liberalism|liberal]] era. The unification of industrial, mercantile and banking interests had defused the earlier liberal capitalist demands for the reduction of the economic role of a [[mercantilism|mercantilist]] state; instead, finance capital sought a "centralized and privilege-dispensing state".<ref>Bideleux and Jeffries, p. 359.</ref> Hilferding saw this as part of the inevitable concentration of capital called for by Marxian economics, rather than a deviation from the free market.

Whereas, until the 1860s, the demands of capital and of the [[bourgeoisie]] had been, in Hilferding's view, [[constitutionalism|constitutional]] demands that had "affected all citizens alike", finance capital increasingly sought state intervention on behalf of the wealth-owning classes; capitalists, rather than the [[nobility]], now dominated the state.<ref>Bideleux and Jeffries, p. 359–360.</ref>

In this, Hilferding saw an opportunity for a path to socialism that was distinct from the one foreseen by Marx: "The socializing function of finance capital facilitates enormously the task of overcoming capitalism. Once finance capital has brought the most importance (''[[sic]]'') branches of production under its control, it is enough for society, through its conscious executive organ – the state conquered by the working class – to seize finance capital in order to gain immediate control of these branches of production."<ref name=Hilferding>"Rudolph Hilferding. Finance Capital: A Study of the Latest Phase of Capitalist Development. Chapter 25, The proletariat and imperialism. http://www.marxists.org/archive/hilferding/1910/finkap/ch25.htm"</ref> This would make it unnecessary to expropriate "peasant farms and small businesses" because they would be indirectly socialized, through the socialization of institutions upon which finance capital had already made them dependent. Thus, because a narrow class dominated the economy, socialist revolution could gain wider support by directly expropriating only from that narrow class. In particular, according to Hilferding, societies that had not reached the level of economic maturity anticipated by Marx as making them "ripe" for socialism could be opened to socialist possibilities.<ref>Bideleux and Jeffries, p. 360.</ref> Furthermore, "the policy of finance capital is bound to lead towards war, and hence to the unleashing of revolutionary storms."<ref name="Jeffries p. 360">Quoted in Bideleux and Jeffries, p. 360.</ref>

Hilferding's study was subsumed by [[Lenin]] into his wartime analysis of the imperialist relations of the great world powers.<ref>Frederic Jameson, 'Culture and Finance Capital', in ''The Jameson Reader'' (2005) p. 257</ref> Lenin concluded of the banks at that time that they were “the chief nerve centres of the whole capitalist system of national economy”:<ref>Quoted in E. H. Carr, ''The Bolshevik Revolution 2'' (1971) p. 137</ref> for the [[Comintern]], the phrase "dictatorship of finance capitalism"<ref>Quoted in F. A Voight, ''Unto Caesar'' (1938) p. 22</ref> became a regular one.

In such a traditional Marxist perspective, finance capitalism is seen as a dialectical outgrowth of [[industrial capitalism]], and part of the process by which the whole capitalist phase of history comes to an end. In a fashion similar to the views of [[Thorstein Veblen]], finance capitalism is contrasted with industrial capitalism, where profit is made from the manufacture of goods.

[[Fernand Braudel]] would later point to two earlier periods when finance capitalism had emerged in human history—with the Genoese in the 16th century and the Dutch in the 17th and 18th centuries—although at those points it was from commercial capitalism that it developed.<ref>C. J. Calhoun/G. Derluguian, ''Business as Usual'' (2011) p. 57</ref> [[Giovanni Arrighi]] extended Braudel's analysis to suggest that a predominance of finance capitalism is a recurring, long-term phenomenon, whenever a previous phase of commercial/industrial capitalist expansion reaches a plateau.<ref>Jameson, p. 259-60</ref>

Whereas by mid-century the industrial corporation had displaced the banking system as the prime economic symbol of success,<ref>A. Sampson, ''Anatomy of Britain Today'' (1969) p. 475</ref> the late twentieth-century growth of derivatives and of a novel banking model<ref>P.Augar, ''Chasing Alpha'' (2009) p. 122 and p. 108</ref> ushered in a new (and historically fourth) period of finance capitalism.<ref>Jameson, p. 256-7</ref>

[[Fredric Jameson]] has seen the [[Globalization|globalised]] abstractions of this current phase of financial capitalism as underpinning the cultural manifestations of [[postmodernism]].<ref>Jameson, p. 268-273</ref>