Politics & Politics in Financial Markets…
September 28, 2008
One of the most delicate questions that SSF is going to face is how to talk about political action taken by the state (bailout (D) / workout (R)) while distinguishing this from the broader definition of politics inherited from 1970’s social science. In the latter, politics is not carried out within a certain set of institutions, but is an intricate part of all human action, it is impregnated in the practices of everyday life.
There are two kinds of politics in financial markets: Those that occur as tools and technological infrastructures are built, and those that are enacted through government agents and public policy. The crisis makes it imperative that we be able to speak about both of these fluently, to render each relevant and yet distinct.
Here is an example: Interestingly enough it seems as though it is Republicans who are blocking the bail out plan. Although Democrats hold the house and can pass any resolution without the support of Republicans, there is a general reluctance to pursue a partisan plan. (See this Bloomberg’s clip for some of the issue at play, where the interviewer, Kathleen Hays insists to House Representative Blunt (R, Missouri) that the delay is like playing with fire.)
Here’s one where the Janet Tavakoli claims that ‘finance is the political boogeyman’. Notice the endless overtones to non-democratic political systems: communism, totalitarianism, socialism…?
Before we delve any further into this exchange, I think it is important to make our question explicit: The question I had originally raised was not about whether our work on finance is or is not political . As Yuval points out, micro-scholarship movements such as ethnomethodology (literally the methods of the people) were inherently political. By extending the definition of what should be considered political to every day practices, 1960’s micro-scholarship sought to remove politics from big (state) institutions and re-conceive of it as a distributed property happening everywhere (the personal is political). These statements were simultaneously descriptive (shifting the object of study) and performative (intended to be a persuasive argument for the greater inclusion of more groups into formal political processes).
Laboratory studies like trading floor studies adopted the ethnomethodological position to politicize esoteric spaces: scientists and traders are people doing situated and contingent work: their work involves messy politicking. The charge of elitism towards lab studies and trading floor studies is really quite misplaced, for this work puts expert and non-expert groups on par. These studies make it possible to treat a group of say, laboring migrants, with the same analytic tools as Nobel prize winning bio-chemists. So why don’t we talk more with scholars of laboring migrants? Because ironically, many scholars of non-elite groups do not appreciate the equalizing effects of a micro-politics for everyone when pushed to its logical conclusion. When everyone is symmetrically engaged in meaningful practice and politics the traditional basis for critique drops out the bottom.
Exploring the similarities of how the trader uses the spread plot just as migrants might use cell phones to creatively assemble new forms of opportunity is distinctly distasteful to many of our colleagues. When talking about how these groups relate to one another in the world, they shift gears, preferring to talk abstractly about how ‘our’ traders are participants in a global capitalism that suppresses ‘their’ laboring migrants. And they sincerely wonder why we don’t do the same. I have to say, although I don’t find that form of argument particularly useful, I increasingly have sympathy for the question – for the desire to understand how the micro-activities of some groups seem to spill out as a force onto those of others. Not just how, say, one scientific group trounces another in the race to sequence the genome, but how genomic research might produce a forms of commercially developed HIV treatment whose application are unaffordable for the vast majority of people.
That micro-studies are political – because they certainly are – no longer seems to be enough. The question is: To what extent are these studies up to the task of answering other types of questions. Are we able to open up our finance oriented research program to include global questions of inequality and disparity in global resource provisioning and allocation? Are we able to show how these are not the problems of imperfect (financial) markets but to precisely trace how these are the very properties of extant market systems? Instead of ideologically condemning market systems as, on the one hand, impossible fictions, or, on the other, naked exercises of power, the idea is to ask a micro-empirical question about how these systems have been developed technically to produce the specific geo-political situations we know today.
It seems to me there are other politics and other political questions to the ones that have been tackled. I definitely do think our methodological approaches are elastic enough to examine a broader range of questions. But this will require active ‘translation’ and an adaptation to new data, and new kinds of research sites. These are not problems that can be inductively solved base on the research that has already been done…
Thanks for engaging in this conversation, Yuval.
