jane dark's sugarhigh!

taylor swift is a marxist!

real badiou

Surely much of Alain Badiou's essay "Of Which Real is this Crisis the Spectacle?" (generously translated into english by Infinite and Savonarola) is salutary, and its conclusion only moreso:

Total break with capitalist-parliamentarianism, the invention of a politics on a level with the popular real, sovereignty of the idea: it's all there, everything we need to turn away from the film of the crisis and to give ourselves over to the fusion between live thought and organised action.

In trying to understand the crisis, and imagine our way toward such fearless demands, certain particulars of Badiou's essay bear noticing.

The main analytic involves in essence the collapsing of two Jamesonian formulations — that of "the real of history," and the epigrammatic "history is what hurts" — into a single, sharp point: the real is what hurts. Not the "real economy," not the spectacle of financial meltdown, but actual human misery which exists in contrast to fictitious capital and mendacious reportage. It would be tempting to describe the essay as "Jameson without political economy" (sometimes called "philosophy") — except for Badiou's gesture in that direction, so unfamiliar as to provoke Infinite's exclamation: "Badiou on mortgages! Who'd have thought it?" In short, one small measure of the crisis is this: it is spectacular enough to seduce even the set theorists into talking securitization, if only to dismiss it. And it must be remarked: Badiou treats the specifics well, choosing a select few and offering them up incisively without sacrificing his demands on the pyre of the technicians.

Let us start with what he gets right. Badiou notes that financialization is scarcely a new fact. And he adds, with even more justification, that there is no division between the speculative and "real" economy, and finally no such thing as "fictitious value" — a term which provides as much coverage to bankers as it does insult, since it proposes falsely that the financial processes are somehow isolated from exploitation in the production processes. And so he proposes, again compellingly, that "the return to the real cannot be a movement leading from bad "irrational" speculation back to healthy production." Instead, it must be "the return to the immediate and reflective life of all those who inhabit this world."

Now let us attend to what he gets wrong. He errs by ignoring the mutations of financial capital in the last 35 years, and their relation to the specific development of a world political dynamic. Which is to say that, while understanding the relation of the speculative and real economies, he fails to insist on the conjoining of finance space and political space. And this points up his classically Badiouvian horizon: even when gesturing toward economic facts, he cannot read the relation between political economy and the state.

Further, he can't read the relation between the political economy and the real. He treats the spectacle as an independent object projected to distract the audience from the real. This is more or less the antithesis of how Debord presents the spectacle, which is as anything but a diversion, a made object, a thing. "One cannot abstractly contrast the spectacle to actual social activity: such a division is itself divided. The spectacle which inverts the real is in fact produced." And, more specifically elsewhere: "The spectacle is not a collection of images, but a social relation among people, mediated by images." Perhaps Badiou had in mind Regis Debray's mediatisation, or Baudrillard's simulation. But the spectacle does not replace nor distract from the real; it is an expression of real conditions, produced by the developmental logic of capital and its forms of exchange. The social sphere may no more look away from the spectacle than I may look away from my own mind. There is no choice between spectacle and real; Badiou's title is nonsensical. Or, rather, it is non-dialectical. This may seem an abstract point: it had clear and absolute consequences for his analysis.

This non-dialectical thought conceives of things like state, political economy and the real as autonomous objects, only related — it would seem — by something like decisionism, as if we could simply turn away from one and toward another. This is evident in the inert presence within his argument of the autonomous concept, "immediate and reflective life" — an Archimedean position from which "one can observe capitalism without flinching, including the disaster movie that it is currently inflicting upon us." It is apparently arrived at via revelation.

One can't blame Badiou for such fantasies; they are a survival strategy. Less defensible is his root economic claim, to wit: "The real essence of the financial crisis is a housing crisis."

No it's not.

This is not to say that what has happened with housing has not been a source of actual homelessness, penury, and misery — and that this wants better attention than the hypnotic representational sway of the Dow Jones Index. And perhaps, as a generous friend argues, Badiou isn't referring to the specific housing crisis of foreclosures, but taking the opportunity to remind us of the ongoing global immiseration of the homeless — in which case his argument has nothing to do with this crisis in particular, and is reasonable to the very extent that it's entirely general. But if one wants to think economically or politically about the crisis — and as everyone with a handle on the dialectic knows, these constitute a single thinking — one ought to grasp that "the real essence of the financial crisis" is a doubled crisis of credit and of hegemony.

It is important to specify what "crisis of credit" means — and what it does not mean. It does not mean that the sudden credit freeze within the financial industry; it does not mean the unavailability of commercial paper in the money markets; it does not mean the phenomenon first called "flight to safety" and then shortly amended to "flight to quality." It does not even mean panicky deleveraging, or the failure of banks and hedge funds which cannot meet margin calls. And finally it does not mean the decreasing access to consumer credit, though that's a bit closer. The crisis of credit is found in the status of the relationship between the speculative and real economies.

The relationship is in essence contractual. The speculative economy expands based on the extension of credit. This extension of credit is in effect a contract, and it is not vague and mysterious (despite the mysterious financial instruments that wheel about withn it). It is a contract committing the real economy to increase the intensity, magnitude, and/or duration of its exploitation of labor so as to return that real value to the economy. That promised exploitation — on which every deal in the speculative economy eventually rests — is a guarantee of misery to human lives, and it doesn't get realer.

The meltdown is the upwelling of doubt that this contract to deliver real exploitation of value sufficient to the extension of credit can be honored. We can see that this macro-level reproduces the exact form of an individual mortgage disaster (say, e.g., an option ARM mortgage), wherein things fall apart as soon as home equity value ceases to increase within an endlessly expanding market. Having seen this, one sees that the crisis is isomorphic not simply with its individual cases but with geopolitics: the grand strategy for increasing intensity, breadth and duration of labor exploitation is exactly what we call neoliberalism. Thus the crisis of credit, wherein the promise to increase exploitation is no longer believed, is not just isomorphic to, but merely a different phrasing for, a crisis of hegemony. They are the same scheme to command and harvest a single space which is at once political and economic. Economics and the state are explicitly, absolutely and dialectically intertwined through the marriage of credit and hegemony in the modern era. This can be seen in the notion through which other nations and sovereign wealth funds purchase American paper to secure the protection of the U.S. military in our role as global cop, while the U.S. in turn funds its geopolitical force with such revenues.

But this is ending. That is the global truth of the crisis. The US-led interstate system, in conjunction with current transnational corporate forms, can no longer compel a belief in its own endless extensibility. Not even when Condoleeza Rice sneaks onto the television during the early peak of the meltdown to rattle sabers in Russia's direction — as if she could click together her famous heels while chanting hegemony hegemony hegemony and transport herself to the familiar comforts of home. Alas. Toto, I've a feeling we're not in Washington Consensus anymore.

We can now dispense entirely with Badiou; even accepting his definition of the real as the immiseration of the impoverished and exploited and displaced (and who but the most churlish of ideologists would refute that?) it's clear that the geoeconomic crisis is in no way exterior to such miseries. The crisis of credit/hegemony (or cregemony) is tied deeply and absolutely to the real and its fate, and to think these matters means to think political economy and geopolitics, and to think them together.

Without diverting attention from local effects (and I must say, the suddenly popular deployment of the term schadenfreude to indicate all feelings other than tender humanist concern is an impoverished account indeed of the affective lives engendered by capital), this systemic and historical crisis wants equivalent thought. I would argue that this is an occasion where revolutionary thought is not just possible but necessary, according to history itself.

Arrighi describes the successive cycles of world-system hegemony as each expanding on the previous in ways that are both quantitative and qualitative. One notes, at the same time, that pivotal revolutionary moments within the world-system have had three characteristics, which Yeats understood perfectly well when he wrote "Things fall apart; the centre cannot hold" (funny how poetry was once empowered to confront these matters). One: they happen during moments of exchange between hegemonic centers: the American, French, Haitian et al revolutions taking place during the transition from the Dutch to British empires; the Russian Revolution during the overlap between British and United States world regimes. Two: they happen not within the hegemonic exchange, but off to the side. Three: they increase in aggregate scale and organizational complexity, just as the empires do. All of which is to say that such revolutionary moments have a tendency to appear in a time and place where the struggle is not successfully magnetized by a singular hegemonic force, with a magnitude related to the magnitude of the world-system itself.

Or to rephrase the matter slightly: South America. It is, after all, there that the fading of U.S. geoeconomic hegemony has been most visible, as the capacity to enforce neoliberal economic restructurings via the IMF/World Bank nexus becomes a memory. Of course the political and economic shifts on the continent have been very much along the lines of three steps forward, two steps back in the last forty years, as has been well-summarized here. In part this is endogenous to the continental situation, with its differences in history, language, resources. However, this should be understood not as an impossible horizon but as an inevitable consequence of the broadening field of action, per element three above: a tenuous, only half-coordinated continental revolution. Two more evident horizons present themselves.

One is that it is hard to conceive of what form this current transition will take. It is unlikely to appear as a "world war"; unlikelier still as some sort of direct handover, as in the current fantasia, in which everyone wakes up one day and says in unison, "All hail China!" That this hegemonic exchange will be slow and unfamiliar, a mutation that doesn't accord with the world-picture fostered by the Westphalian interstate system, does not mean that it isn't happening nonetheless.

In the shorter run, the economic crisis will surely manifest itself in horrifying ways in Latin America itself, in ways that inhibit any kind of Mercosur solidarity — structural debt remains, even if the Chicago/Bretton Woods mandate has lost its premillennial charisma. This will be a real site of struggle, both economic and perhaps military. The reformulation of credit/debt relations between Norte and Sur, which exists in inextricable concert with the real housing crisis, is also a condition of possibility for the real revolutionary moment we are already in.

Given that the movie industry has played a significant role in the era of U.S. hegemony, both as economic engine and ideological chassis, it should surprise no one that it turns now to speak of that era's end. Perhaps — no, certainly —  that is the import of not one but two films being released in swift succession on the life of Che Guevara, the spectral embodiment of a unified revolutionary Latin America: films that are at once apparitions of the spectacle and expressions of the real.

apocalyptic capitalism

A brand of progressivism soothes itself by making reference to “apocalyptic Marxism”; this seems little more than weak comedy, as when an acquaintance stumbles up to you at a party, eyes glazed, to slur, Oh my god you are so wasted. But of course we must recognize the moment of truth in such a projection. The phrase “apocalyptic Marxism” is merely capital’s admission that the end of the current arrangement of private property, and of extracting value from human bodies, would indeed be annihilation of all. The capitalist is entirely identified with surplus value; when it dies, the world dies with it.

In realityland it is capitalism that is apocalyptic; so says the news every quarter of an hour. This is internal to the logic of capitalism itself, and particularly finance capital; even the closest camp followers of money cannot produce any external reason for this disaster. The two core characteristics of finance capital, correlation and credit, tend irrevocably toward this apocalyptic situation. Correlation is the situation produced by the need for increasingly rapid and voluminous transfers throughout the financial network; credit, what is transferred. Profits are made by balancing local risks, and then striking at increasingly slighter and briefer differentials. The strikes must therefore be delivered with ever-greater force. So there must be ever more channels and ever more liquidity to pour through them. Thus the rise in the extension of “leverage” — the ratio of borrowed to held assets — is not a “failure of fundamentals” but an absolute inevitability of finance capital. Correspondingly, because of these channels, an illness in one sector is increasingly likely to express itself as contagion systemwide. And because states as well as financial institutions are imbricated in correlation — this is the import of the phrase “too big to fail” — systemic risk is not just fiscal but global and political. One can even buy insurance against this eventuality, insurance against the end of the world, to improve one's bond rating as one sells dubious derivatives on to the next station.

The trade is the purchase of insurance against what would in effect be the failure of the modern capitalist system. It would take a cataclysm — around a third of the leading investment-grade corporations in Europe or half those in North America going bankrupt and defaulting on their debt — for the insurance to be paid out. (Mackenzie here)

Another way to describe the relation between correlation and credit, alongside channels and liquidity, is that between circulation and production. The credit has to be credit against something. It is a series of guarantees made and believed, stacked one atop the other like turtles. Even wagers that certain promises won’t be kept — insurance, credit default swaps, etc — are not external stabilizing forces on this stack of turtle; they're internal to the operation of the financial system. They too are part of the series of guarantees. They too have to be believed. And something has to produce this belief.

That is to say, it is not turtles all the way down (Buddhism is an opiate too). The bottom turtle rests on the production floor: the “real economy” where people go to work, make stuff, are paid wages minus surplus value, and in turn purchase stuff. The problem, from the perspective of financial capital, is that the value generated in that process can no longer keep up with the accelerating needs generated by financial competition: derivatives trading now far outpaces the commodity economy. And so, at the point where production floor and the stack of turtles meet, consumer credit becomes the pivotal guarantee: the promise that the real economy of the future, and of new and distant lands, will be paid into the ongoing apparatus — and thus can be spent now, guaranteeing all the other guarantees above it. Consumer credit is the bottom turtle. It’s a balloon turtle, really, that needs to be continually inflated; we call these “credit bubbles.”

It is clear enough that this abstract situation dominated by a single, endlessly expanding, relentlessly interconnected aggregation of corporations and states premised on the increasing internalization of labor across space and time is nothing but the financial expression of the concept of globalization, of neoliberalism itself. This is a point that Jasper is making here. And it thusly is clear that the attempt to “rescue” the financial sector is an attempt to rescue the neoliberal project.

There is perhaps something to be gained from recognizing the bailout as yet another credit bubble: money from future work to be made available now, but this time without even the choice to take out a mortgage or take home a flatscreen TV. When people keep asking “where will the money come from” they are simply asking about this problem, about the relation of circulation to production. For the bailout to work, one has to believe in the first place that the real economy can and will pay out such a figure in addition to its other requirements, in the future and in distant as-yet-unincorporated lands.

In the penthouse of the bailout debate, however, the central question seems to concern which turtle to inflate. And so even the most “liberal” economists simply suggest it will work better if we treat a lower turtle. Pure liquidity, at the head of the top turtle? A turtle slightly lower in the pile, like a stratum of financial corporations? Small business turtles? The lowest turtle of consumer credit and consumer demand? This set of choices is called “the political spectrum.”

None of this can answer the question about what will be made, sold, purchased within the real economy as it is abstractly mortgaged against this present loan. More commodities, more houses? Ironically, what is on offer this month is apocalypse itself. Or rather, safety from it. We are getting nothing for 700 billion but promised protection against the threat of systemic failure, a threat issued hour by hour on the news, by politicians and economists. We are made to purchase the very insurance Mackenzie discusses, but may sell nothing onward. Apocalypse is merely capitalism’s last new line, the latest in use value, though we are compelled always to imagine that it comes from somewhere else, is someone else’s idea…