The Politics of Democratizing Finance: A Radical View

Abstract

How can finance be durably democratized? In the centers of financial power in both the United States and the United Kingdom, proposals now circulate to give workers and the public more say over how flows of credit are allocated. This article examines five democratization proposals: credit union franchises, public investment banks, sovereign wealth funds, inclusive ownership funds, and bank nationalization. It considers how these plans might activate worker and public engagement in decision making about finance by focusing on three modes of public participation: representative democracy, direct democracy, and deliberative minipublics. It then considers the degree to which democratization plans might be resilient to de-democratization threats from business. It argues that of the five, bank nationalization goes furthest in guarding against de-democratization threats but is still pocked with pitfalls if it relies solely on representative democracy. It argues that two criteria appear necessary for democratically durable alternatives: the active direct participation of workers and citizens and the weakening of businesses’ capacity for democratic retrenchment.

Towards an institutional “landscape” view of modern money creation mechanisms and some reflections on their ecological significance

“…In the context of fuel price rises following the COVID-19 period and the conflict in Ukraine, government spending on nuclear, and shale gas exploration has turned upwards, much to the disappointment of pro-renewable activists (New York Times 2022 ). This underlines that, even if central banks themselves were to become more democratic, transparent, and accountable, as scholars such as McCarthy ( 2019 ) have argued they should, their fiscal-monetary coordination would still be constrained by the legal and political character of the broader state in which they are located (Block 2014 , 2019 ).…”

Exit, control, and politics: The structural power of finance under asset manager capitalism

“…legitimacy of control rights associated with stock holdings or about the costs and benefits public asset management and ownership -are being re-opened (Block, 2014;Buller & Lawrence, forthc. ;McCarthy, 2019;Palladino, 2019).…”

Book review: Labor in the Age of Finance: Pensions, Politics, and Corporations from Deindustrialization to Dodd-Frank

“…Yet, “finance” does not just refer to rapacious Wall Street firms. Possibilities exist for radically altering finance for the public good and labor specifically (Block, 2019; McCarthy, 2019). It would have been helpful had Jacoby, who has a deep understanding of this topic, ruminated on these historical lessons.…”