INTRODUCTION: CULTURES OF FINANCE

WHEN THE CRISIS, WHICH WAS A CERTAINTY,

BECOMES A CONTINGENCY

Kay Bal and Mar Wdtu

I

Since Karl Polyani published The Great Transformation in 1944,

cultural theorists have become less teleological and more chastened
in their hope that the crises, which reveal the contradictions inherent
in capitalism, will inevitably bring about its disintegration.1 At the
start of the new millennium, this attitude may be attributed in part to
the intensification of debt, speculation, and risk on global, national,
corporate, and individual levels that has attended changing patterns
of accumulation in the post-World War II era.
Greta R. Krippner understands financialization as "a pattern of
accumulation in which profit-making occurs increasingly through
financial channels rather than through trade and commodity produc-
tion."2 Her initial analysis gauging relative industry shares of corpo-
rate profits between 1952 and 2001 in the United States demonstrates
a dramatic decline of manufacturing in contrast to the finance, insur-
ance, and real estate industries.3 These industries have not only be-
come the dominant sector of the economy but also grow increasingly
volatile the more they disengage from production.
This state of affairs provides part of our impetus as guest editors
of this special issue to reevaluate Marx's arguments about the com-
petition between finance and industrial capital and to consider the
role of fictitious capital vis-A-vis public perceptions of debt and risk.
According to David Harvey, fictitious capital refers to the flow of money
capital not backed by any commodity transaction. More specifically,
"the category of fictitious capital is, in fact, implied whenever credit
is extended in advance, in anticipation of future labour as a counter-
value."4 Harvey's emphasis on the inherently fictitious character
of credit is consonant with Krippner's use of the term financial to

Cultural Critique 65-Winter 2007-Copyright 2007 Regents of the University of Minnesota

2 1 KARYN BALL AND MARK WOYTIUK

comprise "activities relating to the provision (or transfer) of liquid

capital in expectation of future interest, dividends, or capital gains."'
In his attention to the hegemonic emergence of a "mass investment
culture," 6 Adam Harmes notes that "new trends, associated with the
rise of the mutual-fund industry and an emerging 'investment cul-
ture' may be creating the perception of a growing link between the
interests of workers and finance capital," which has transformed
"tens of millions from passive savers into 'active' investors." Harmes
argues that this transformation disciplines voting constituencies into
favoring neoliberal, macroeconomic polices and structures that are
7
opposed to their interests as workers.
A few events have recently heightened scholarly and media atten-
tion to the potentially catastrophic consequences of shareholder value
as a fulcrum of corporate governance as well as speculative trading
associated with the proliferation of new financial instruments. In the
hysterical wake of the punctured dotcom bubble, Enron's bankruptcy
in 2001 was among the first of many scandals to traumatize market
faith by devastating U.S. stockholder savings and pensions. Enron's
employees shared their fate with those at Nortel Networks Corpora-
tion, Lucent Technologies, and Global Crossing, who were also over-
invested in company stock when it dove and dissolved their savings.
In the same year, Argentina declared its inability to make payments
on its external debt, thereby precipitating the largest sovereign default
in history. Notably, finance has also become an important term in the
"war against terrorism" as the United States and other G7 countries
have sought to control the flow of funds to particular groups. While
official responses to these events have varied nationally, most are
mediated by "common-sense" assumptions about market rationality
and a fetishistic faith in the magical potency of financial liberaliza-
tion. This faith has made workers susceptible to a disciplinary rhetoric
that currently promotes the privatization of investment risk in retire-
ment planning.
Studies of financialization conducted by researchers in the social
sciences have often resulted in positivistic and economistic views of
speculation, debt, and risk. Yet, as Marcus Taylor and Adam Morton
have recently pointed out, even those political economists commit-
ted to challenging this tendency seem to have forgotten the category
of socially necessary labor, despite their almost exclusive reliance on
 INTRODUCTION I

Marxist theories.8 These methodological and theoretical shortfalls have

narrowed the range of inquiry about financialization and its implica-
tions for subject formation. To open up this line of inquiry, the editors
of this special issue have invited scholars from the social sciences and
the humanities to consider the value of cultural theory for critical
approaches to financialization.
Karyn Ball's "Death-Driven Futures, or You Can't Spell Deconstruc-
tion without Enron" turns to Jacques Derrida, Jean Baudrillard, and
David Harvey to examine how Enron inadvertently "deconstructed"
a fetishistic faith in market rationality through its calculated gaming
with the imaginary proleptic potential of value determinations in its
trading, financing, and accounting strategies. Her argument is that such
strategies "hyperrealized" projected revenues and derealized debt in
order to inflate Enron's stock values from the letter rather than the sub-
stance of speculative gains. The essay also considers debates about
the 2002 Sarbanes-Oxley Act, which responded to the implosions of
Enron and Worldcom by legislating for the reform of corporate gov-
ernance structures and enjoining greater transparency in financial
representations. Ball's consideration of diff6rance as the horizon of
postmetaphysical theories of designation and production links her
analysis with A. Kiarina Kordela's "Marx's Update of Cultural The-
ory." Kordela sees the differentiation and deferral of surplus value as
the "transcendental" principle of capital accumulation as a whole
and thus calls on us to rethink the presumed historical break between
productive and virtual capital. A reading of Spinoza serves as a de-
parture point for her critique of Michael Hardt and Antonio Negri's
failure in Empire to acknowledge the interrelationship between "tran-
scendent" and "immanent" authority. Just as the normal functioning
of capital is revealed in fictitious capital, Kordela argues, the normal
functioning of power is revealed in disciplinary power.
Kordela reaffirms Marx's relevance in light of Spinoza, Derrida,
Kojin Karatani, and Lacan. Their writings inform her theorization of a
hysterically Cartesian introjection of market uncertainty: "the Other/
Capital exists, therefore I am," or "I capitalize (through risk-taking),
therefore I am." Public- and private-sector manipulations of this un-
certainty play a crucial role in producing a mass investment culture,
as Paul Langley's contribution contends. In "Uncertain Subjects of
Anglo-American Financialization," Langley brings Foucault's theses
4 KARYN BALL AND MARK WOYTIUK

on governmentality and subjectification to bear on personal invest-

ment and consumption as disciplinary modes of "securing, advanc-
ing, and expressing individual freedom in neoliberal society." The
essay thus repoliticizes discourses of financial literacy that configure
investment and pension planning as technologies of the self. Susanne
Soederberg also considers the neoliberal disciplining of investor sub-
jects in "Freedom, Ownership, and the Privatization of Social (In-)
Security in the United States." The essay historicizes the Social Secu-
rity system in the United States from the advent of pension plans
after the Civil War to the present in order to situate George W. Bush's
Ownership Society rhetoric as a strategic adaptation to crises of
overaccumulation.
Maureen Sioh's and Marieke de Goede's contributions illuminate
the global power of financial regulation to unravel state autonomy. In
"Pricing Race, Circulating Anxieties, and the Fate of Malaya's Cur-
rency Reserves at Independence," Sioh offers a case study of the
Malayan government's decision to peg its currency to sterling rather
than U.S. dollars after the break from British imperial rule. Her
analysis problematizes the assumption that independent postcolonial
states make completely autonomous financial decisions by highlight-
ing the extent to which the combined force of colonial structures and
racial stereotypes institute social hierarchies that overdetermine eco-
nomic practice. De Goede's "Underground Money" also probes the
ideological coding of financial hierarchies. Like Kordela, de Goede is
critical of Hardt and Negri's conceptualization of Empire, but she
selectively draws on it to expose a discourse that projects "a clearly
bounded and rationally organized space for global finance on the one
hand and a clearly bounded and centrally organized space for under-
ground money on the other." De Goede's analysis of the detection and
prevention strategies employed in the post-9/11 war on terrorist fund-
ing isolates the terrorist underground as a discursive construct that
consolidates the apparent "legitimacy" of global finance.
In "Debt and Denunciation in Post-bubble Japan: On the Two
Freeters," Mark Driscoll identifies an anxious rhetoric at the official
political level and in popular culture that blames national and eco-
nomic degeneracy on "freeters"-unmarried 15-34 year olds who
work part time or are unemployed. Driscoll reveals that freeters are
alternately tolerated or condemned for their purported postnationalist
 INTRODUCTION 1 5

apathy, yet they engage in concerted protest against state practices.

The ambivalence that surrounds them as fringe figures is sympto-
matic of a climate that refracts the fallout from Japan's "orgy of finan-
cial speculation in the 1980s" by disciplining workers and leftists into
accepting financialization as part of a neoliberalized social contract.
In "Escape Artists: Germany, Fortress Europe, and the Situation-
ist Rescripting of Travel," Ole Gram interprets the avant-garde prac-
tices of the Munich-based artist collective Bundesverband Schleppen
& Schleusen, an ostensible "PR firm and lobbying organization" that
"hijacks" corporate discourse and iconography. Their situationist style
of intervention ironically enunciates how the term mobility gains a
privileged place in a universalistic discourse about "globalization" as
long as it pertains to finance, technology, and commodities but not to
"human capital." Gram revisits Peter Bilrger's Theory of the Avant-
Garde and Guy Debord's Society of the Spectacle to foreground the per-
formativity of Schleppen & Schleusen's advocacy on behalf of human
mobility and global capital flow over and against EU policies that
criminalize migrant workers while occulting the exploitation of their
labor. We conclude the volume with Driscoll's and Gram's contribu-
tions because they move beyond an earnest literalization of Marxist
universals while responding to Taylor and Morton's 2006 call to main-
tain the visibility of labor in cultural theories of finance.

Notes

1. Karl Polyani, The Great Transformation:The Political and Economic Originsof

Our Time, introduced by R. M. MacIver (Boston: Beacon Press, 1957).
2. Greta R. Krippner, "The Financialization of the American Economy," Socio-
economic Review 3 (2005): 173-208 at 181. She adopts this definition from Giovanni
Arrighi's The Long Twentieth Century: Money, Power, and the Origins of Our Times
(London: Verso, 1994).
3. Krippner, "The Financialization of the American Economy," 179-80.
4. David Harvey, The Limits to Capital (Chicago: University of Chicago Press,
1982), 266.
5. Krippner, "The Financialization of the American Economy," 174-75.
6. Adam Harmes, "Mass Investment Culture," New Left Review 9 (2001): 103-24.
7 Ibid., 105.
8. These remarks were made in the context of panels devoted to labor issues
at the 2006 International Studies Association Conference in San Diego.
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TITLE: Introduction: Cultures of Finance: When the Crisis,

Which Was a Certainty, Becomes a Contingency
SOURCE: Cult Crit 65 Wint 2007

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