Chapter Abstract
How does finance affect the politics of everyday life? This chapter examines how finance affects the politics of everyday life, and how the financialisaton of the everyday is often obscured until it is disrupted. Using the Global Finance Crisis in 2007-2008 as an illustrative example, this chapter examines how the most routine aspects of our lives are inserted within a global economic system, and how changes to the global economy can have a significant impact on how we live our lives. Whereas most responses have tended to focus on the regulatory failures that created the Global Finance Crisis in 2007-2008, this chapter calls for a re-politicisation of finance, and a re-politicisation of everyday life, so that we can ask more critical questions about how our economies – and our everyday lives – are structured.
Additional web content and audio-visual materials
- ‘The Giant Pool of Money’ (This American Life podcast), http://www.thisamericanlife.org/radioarchives/episode/355/the-giant-pool-of-money. An excellent explanation of the financial forces behind the sub-prime crisis appeared on National Public Radio’s and WBEZ’s radio programme, This American Life.
- Debtocracy, http://youtu.be/qKpxPo-lInk. A documentary film about the crisis in Greece.
- The Watson Institute at Brown University presents Mark Blyth on Austerity, http://youtu.be/FmsjGys-VqA. Mark Blyth, a professor at the Watson Institute for International Studies at Brown University, on what’s wrong with austerity.
- http://www.guardian.co.uk/world/gallery/2011/oct/18/occupymovement-protest. The UK newspaper the Guardian published a series of photos of the ‘occupy everywhere’ events of 18 October 2011.
- Quantitative easing, http://www.bankofengland.co.uk/monetarypolicy/Pages/qe/default.aspx.
- Debtwatch, http://www.debtdeflation.com/blogs/. Steve Keen’s blog was an excellent source of heterodox economic analysis, but it is updated less frequently now. Other good sources of heterodox economic thought can be found at Prime Economics, http://www.primeeconomics.org; at Progress in Political Economy, http://ppesydney.net; and at Nouriel Roubini’s blog https://www.themaven.net/economonitor.
Additional reading
Pettifor, Ann (2006) The Coming First World Debt Crisis, Basingstoke: Palgrave Macmillan.
One of the myths surrounding the 2007 crisis is that no one saw it coming but this myth is not correct; one of the important warnings was Ann Pettifor’s (2006) book, The Coming First World Debt Crisis.
Taibbi, Matt (2010) Griftopia: Bubble Machines, Vampire Squids, and the Long Con That Is Breaking America, New York: Random House.
One of the best, and angriest, introductions to the contemporary financial crisis is Matt Taibbi’s 2010 book Griftopia: Bubble Machines, Vampire Squids, and the Long Con That Is Breaking America. Taibbi is a political journalist and contributor to Rolling Stone magazine. Griftopia not only provides a good description of the events and characters behind the crisis but also provides clear and lucid explanations of the obscure and technical terms, such as credit default swaps, that have kept the discourse about finance technical and obscure, and not everyday.
Strange, Susan (1997/1986) Casino Capitalism, Manchester: Manchester University Press.
Susan Strange was one of the earliest figures in international political economy to draw attention to the particular way the finance exercises power in the global system. See, for example, Susan Strange (1997/1986) Casino Capitalism.
Epstein, Gerald (ed.) (2005) Financialization and the World Economy, Cheltenham, UK and Northampton, MA: Edward Elgar.
Gerald Epstein (2005) collected a series of important essays that tried to conceptualize financialization in his book Financialization and the World Economy.
There is a range of international political economy literature that has pursued the diagnosis of the crisis in interesting directions. For four very different examples, see:
- Nesvatilova, Anastasia (2010) Financial Alchemy in Crisis: The Great Liquidity Illusion, New York: Pluto
- Eichengreen, Barry (2015) Hall of Mirrors: The Great Depression, The Great Recession, and the Uses and Misuses of History, Oxford: Oxford University Press
- Varoufakis, Yanis (2015) The Global Minotaur: America, Europe, and the Future of the Global Economy, London: Zed Books
- Langley, Paul (2014) Liquidity Lost: The Governance of the Global Financial Crisis, Oxford: Oxford University Press.
Harmes, Adam (2001) Unseen Power: How Mutual Funds Threaten the Political and Economic Wealth of Nations, Toronto: Stoddart.
Shows how financial instruments regulate policy and political options.
de Goede, Marieke (2005) Virtue, Fortune, and Faith: A Genealogy of Finance, Minneapolis: University of Minnesota Press.
A groundbreaking theoretical and historical critique of finance and the forms of power/knowledge that underpin it.
Knafo, Samuel (2013) The Making of Modern Finance: Liberal Governance and the Gold Standard, London and New York: Routledge.
Examines the historical origins of the power of finance as a political instrument.
Cooper, Melinda and Martijn Konings, eds (2015) Rethinking Money, Debt, and Finance after the Crisis, Durham and London: Duke University Press.
Revisits fundamental conceptualizations across diverse sectors of social, cultural, economic, and international life.
Lapavitsas, Costas (2003) Social Foundations of Markets, Money, and Credit, London: Routledge.
A good introduction to money and finance in social context. I have elaborated some of the themes in this chapter in an article titled, ‘The Aesthetics of the Financial Crisis: Work, Culture, and Politics’ (2012).
Langley, Paul (2009) The Everyday Life of Global Finance: Saving and Borrowing in Anglo-America, Oxford: Oxford University Press.
The most systematic and penetrating analysis of finance, international political economy, and everyday life.
Ho, Karen (2009) Liquidated: An Ethnography of Wall Street, Durham and London: Duke University Press.
Karen Ho is an anthropologist who worked in Wall Street and wrote this fascinating ethnographic study of the culture of working in financial services.
LiPuma, Edward (2017) The Social Life of Financial Derivatives: Markets, Risk, and Time, Durham and London: Duke University Press.
Edward LiPuma is a cultural anthropologist who has updated his study of financial derivatives (2017), The Social Life of Financial Derivatives: Markets, Risk, and Time. Of course, each of these books approaches the issues from different theoretical perspectives and reading them will give you as much a sense of how deep the arguments go as of how things are supposed to work.
The analytical framework used in this chapter draws on the contributions of two of the most important figures in contemporary social and political theory.
Lefebvre, Henri (1984 [1968]) Everyday Life in the Modern World, New Brunswick, NJ and London: Transaction Publishers.
––––(1991 [1958]) Critique of Everyday Life vol. 1, London: Verso.
––––(2006 [1962]) Critique of Everyday Life, vol. 2, London: Verso.
––––(2008 [1981]) Critique of Everyday Life, vol. 3, London: Verso.
Henri Lefebvre’s career spanned the twentieth century and he wrote over sixty books. His Critique of Everyday Life appeared in three volumes, published first in 1947 (revised in 1958 and appearing in English in 1991), second in 1962 (2006 in English), and the third volume appeared in 1981 (2008 in English). An overview of his theoretical work can be found in the collection edited by Stuart Elden, Elizabeth Lebas and Eleanore Kofman (2003) Henri Lefebvre: Key Writings.
Rancière, Jacques (1999) Disagreement: Politics and Philosophy, Minneapolis: University of Minnesota Press.
––––(2009) Aesthetics and Its Discontents, Cambridge: Polity Press.
Jacques Rancière has also been extremely prolific. His political philosophy is presented succinctly in Disagreement: Politics and Philosophy. A good introduction to his approach to aesthetics is Aesthetics and its Discontents.