Are Bankers Essential Workers Doing “God’s Work?” – Gerald Epstein

God's work? Maybe so, but they were certainly not doing work for the economy, the taxpayers, or the people. Rather, it turns out we were all working for them. However preposterous Blankfein claim was, he went on to argue something that is contained in almost every money and banking textbook and whic God's work? Maybe so, but they were certainly not doing work for the economy, the taxpayers, or the people. Rather, it turns out we were all working for them. However preposterous Blankfein claim was, he went on to argue something that is contained in almost every money and banking textbook and which is constantly repeated by economists, politicians and bankers: "We're very important. We bankers help companies grow by helping them to raise capital and companies that grow create wealth. This, in turn, allows people to have jobs that create more growth and more wealth. We have a social purpose." That's the way the bankers talk. In other words, bankers are essential workers. Well, that's the article that we're going to talk to one of the authors about today. Now joining us to tell us whether bankers are essential workers is Gerald Epstein. He's the co-director of the PERI Institute. He's also a professor of economics. He received his PhD in economics from Princeton, and he has published widely on a variety of progressive economic policy issues, especially in the areas of central banking and international finance. He's the author most recently of The Political Economy of Central Banking: Contested Control and the Power of Finance. Thanks for joining us, Gerry. Gerald Epstein Thanks a lot for having me, Paul. Paul Jay Talk a bit about this article, because what you get to pretty quickly is that what's essential is not the bankers. What's essential is the banking, meaning we do need banks, but they don't need to be private. Talk a bit about this idea that it's banks that actually are the creators of wealth, which is their big argument. And then we'll get into the public banking part of it. Gerald Epstein Right. Well, banks are essential for many activities, especially for activities under capitalism, but also in social-democratic countries as well. And the thing is, it's not that banks by themselves create wealth. Banks can only create wealth if they serve the economy and they serve society. When banks are just serving themselves, we argue that they don't create wealth, they extract wealth from the rest of society. And the problem that we've had in the last 30 or 40 years under this, what I call "roaring banking" or neoliberal banking system in the United States, the United Kingdom and elsewhere, is that it's been extracting wealth from society, enriching the bankers, and impoverishing the rest of society. So, yes, real banking is necessary if it's serving the economy. But in order to get there, we really have to fundamentally restructure our whole financial system. Paul Jay Maybe before we unpack this further, we should step back and discuss one of the basic mythologies not just of the bankers but of the wealthy in general who are supposedly the job-creators. Except the thing about wealth they don't want to talk about is where that wealth came from in the first place. Like, who actually creates the wealth? Gerald Epstein First of all, Marx talked about primitive accumulation, that is, many of the conditions were for capitalism were expropriated from previous groups and people who had the assets -- land, agriculture, etc. -- and the workers who were working for themselves or in groups. Initially, according to Marx and I think in many places this is true,