They absolutely do. Focusing on investment banks (I assume you have no problem justifying the existence of retail banks and insurers, the other two giant topics in financial services), what they do is effectively make the allocation of capital more efficient.
Without efficient capital allocation, most enterprise becomes extremely difficult. Without banks, there would be no stock market. There would be no way for companies to raise large sums of money to grow faster. There would be no one keeping markets liquid, which would encourage people to stick their money under the mattress rather than invest it. There would be no way for startups to exit, and so there would be no VCs, and no angels either (or at least, much more limited ones, making maybe one or two investments to help out a friend). All of this would massively reduce the amount of capital available to work with, and decimate the business world.
Now, you might take the view that "you don't need capital to do business", but that's just a very limited viewpoint that applies in very narrow circumstances, like some small percentage of internet startups. Almost all businesses need capital to get started. There's a good reason why microloans are so successful - they provide capital that helps enterprise. Think of the banking system as an equivalent of microloans for people who need more than $100 (for example, because they need to design and sell new products, build new factories, buy stock, make strategic acquisitions, etc).
I agree but I think it's a little more complicated.
The problem is that we we loosing developers to high paying jobs in the banking industry. I.e. not your average netbank developer but the developer who can develop for those 1% you talk about.
So the problem is that the developers in talk here are the talented ones that goes for those jobs within certain parts of the banking industry that certainly don't provide anything close to the value they extract from the market.
Your argument only really stands if basically every single one of those programmers is Mark Zuckerberg, able to create a $50b company... I don't think that's a reasonable assumption.
My argument is that the startup community is loosing good developers to a specific part of the banking industry which I fail to see provide much value other than to their bosses.
I have no problem with them making more money. I think it's obvious why they make the choices they do.
The problem is that the part of the banking world they go to. That part of the banking industry that can pay the high salaries aren't benefitting society.
Without efficient capital allocation, most enterprise becomes extremely difficult. Without banks, there would be no stock market. There would be no way for companies to raise large sums of money to grow faster. There would be no one keeping markets liquid, which would encourage people to stick their money under the mattress rather than invest it. There would be no way for startups to exit, and so there would be no VCs, and no angels either (or at least, much more limited ones, making maybe one or two investments to help out a friend). All of this would massively reduce the amount of capital available to work with, and decimate the business world.
Now, you might take the view that "you don't need capital to do business", but that's just a very limited viewpoint that applies in very narrow circumstances, like some small percentage of internet startups. Almost all businesses need capital to get started. There's a good reason why microloans are so successful - they provide capital that helps enterprise. Think of the banking system as an equivalent of microloans for people who need more than $100 (for example, because they need to design and sell new products, build new factories, buy stock, make strategic acquisitions, etc).