The role of the boards of Directors, is to represent the interests of shareholders, not the company. As set out before, shareholders, as owners of interest-bearing capital/fictitious capital, seek to maximise their revenue in the form of interest/dividends. The interest of the company, however, is to maximise its profit of enterprise/retained profit, and so to minimise all other deduction from profit, such as rent, interest/dividends and taxes.
A company that simply borrows money from a bank, or in the bond market, pays only the going, competitive rate of interest on the money it borrows, though, as Marx describes, the worker cooperatives always found they were charged higher rates of interest. But, precisely because shareholders have control over companies, and appoint the boards of directors that set the dividend payments, they are able to pay themselves more than any such competitive market rate of interest. The consequence is that, where a company agrees a higher dividend pay-out, other owners of loanable money-capital seek to obtain it. By buying the company's shares. That causes the market price of those share to rise, and consequently the dividend yield (dividend/share price) to fall back towards the average.
But, in the same way, the speculative money that flows towards these shares flows away from other shares (and other speculative assets). The market price of those shares/assets then would fall, and so on. Speculative money moving to buy shares would cause bond prices, property prices etc., to fall, with a corresponding rise in bond yields, rental yields and so on.
Shareholders, therefore, simply by assigning to themselves a larger amount of interest/dividends than would represent a competitive market rate of interest, bring about changes in all asset prices and yields. But, as Marx sets out in Capital III, Chapter 23, it is still constrained by the laws of capital.
“It would be still more absurd to presume that capital would yield interest on the basis of capitalist production without performing any productive function, i.e., without creating surplus-value, of which interest is just a part; that the capitalist mode of production would run its course without capitalist production. If an untowardly large section of capitalists were to convert their capital into money-capital, the result would be a frightful depreciation of money-capital and a frightful fall in the rate of interest; many would at once face the impossibility of living on their interest, and would hence be compelled to reconvert into industrial capitalists.”
Shareholders cannot simply continue to pay themselves more out of profits as interest/dividends. On the one hand, the process described above creates a vicious circle. Dividend/interest payments rise, asset prices rise, yields fall, but, also, if more and more profit is simply shelled out as dividends/interest, less is available as profit of enterprise/retained profit, so, at some point, the actual industrial capital that creates the profit out of which that interest is paid does not grow. If industrial capital does not grow, i.e. if the social relation it represents does not expand, so that more labour is exploited, surplus value does not grow, and so the profit out of which all those revenues (interest/dividends, rents, taxes and profit of enterprise) are taken does not grow.
It is those laws of capital that have imposed themselves on the ruling-class over the last thirty years. They, also, found nuance, reflection and contradiction in the political sphere. The drawing of ever greater interest/dividends from profits, in the old imperialist state, showed up as deindustrialisation and asset stripping, but the other side of that was a combined and uneven development of large-scale industrial capital in China/Asia, Latin America, and later Africa. The globalisation of production, of which this was part, itself facilitated the continuation of the delusion in the West. It reduced unit costs, and facilitated trade, raising profits. In the same way that Britain, in the 19th century, used its surplus money profits to provide credit to those countries that used it to buy British exports, so China and other countries, now, ploughed money into western credit markets. They loaned money to he US, buying US bonds and so on, pushing up their price and reducing yields.
In the West, the US and UK in particular, the process of deindustrialisation led to a resurrection of the petty-bourgeoisie. It is most noticeable in the UK where, since the 1980's, it has grown by 50%. Napoleon called Britain a nation of shopkeepers, but, since the 1980's, it has been a nation of precarious, self-employed traders, symbolised by “white van man”. That includes those traders involved in the growing trade in illicit substances, home-made porn etc. The majority of adverts on Youtube etc., now assume that their audience are all involved in some kind of small business activity.
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