Yet a much more fundamentally political dimension of the socially constructed nature of capital – nothing less than the specification of a parallel universe with its own natural laws and rules for the physical existence and subsistence of financial capital and its interaction with the other factors of production – has also often been overlooked in contemporary academic literature. Under the current monetary arrangements financial capital is a peculiar creature indeed. Money can be created ex nihilo at the stroke of a pen – or a keyboard – by a specific type of legal person entrusted with the task, not other legal or natural person. With the socially constructed ability to attract compound interest in a world where physical assets rot and break, it does not share the same physical reality with the mere mortal factors of production: even in cases where productive investments which enable the payment of interest in real terms can be identified, the compounding of interest on financial capital is not temporally limited to the period that the relevant physical assets can continue to produce exponential returns in real terms. Rather than representing accumulated wealth that could be “saved” to finance investment, the bulk of money disappears as soon as other factors of production are not willing to pay a tribute to induce its continuing circulation in the form of interest payments. In addition to the inherently political nature of specifications of money have been detached from virtually any substantive connection to the rules or the realities experienced by other factors of production in the physical world that is nonetheless supposed to achieve economic efficiency and a host of other objectives through monetary calculation and monetarily mediated social relationships deserves particular scrutiny.
Yet a much more fundamentally political dimension of the socially constructed nature of capital – nothing less than the specification of a parallel universe with its own natural laws and rules for the physical existence and subsistence of financial capital and its interaction with the other factors of production – has also often been overlooked in contemporary academic literature. Under the current monetary arrangements financial capital is a peculiar creature indeed. Money can be created ex nihilo at the stroke of a pen – or a keyboard – by a specific type of legal person entrusted with the task, not other legal or natural person. With the socially constructed ability to attract compound interest in a world where physical assets rot and break, it does not share the same physical reality with the mere mortal factors of production: even in cases where productive investments which enable the payment of interest in real terms can be identified, the compounding of interest on financial capital is not temporally limited to the period that the relevant physical assets can continue to produce exponential returns in real terms. Rather than representing accumulated wealth that could be “saved” to finance investment, the bulk of money disappears as soon as other factors of production are not willing to pay a tribute to induce its continuing circulation in the form of interest payments. In addition to the inherently political nature of specifications of money have been detached from virtually any substantive connection to the rules or the realities experienced by other factors of production in the physical world that is nonetheless supposed to achieve economic efficiency and a host of other objectives through monetary calculation and monetarily mediated social relationships deserves particular scrutiny.
