ECONOMY OF CRISIS

Economy as an ideology

Doing things, or creating, distributing and consuming objects, services, or ideas does not belong to the sphere of economy per se; they become such only after being subordinated to a certain kind of discipline of economy. In other words, all activities, social relations and their results have to be economized before becoming economic. Economy is an achievement of economization rather than a starting point or a pre-existing reality that can simply be revealed and acted upon(1).

During certain processes — that I shall roughly summarize later — economization has become the biggest ideological and political project of the last two centuries and economy probably the most protected epistemological discipline ever in existence; containing not only the conventional economy; production, distribution, consumption and their practices and institutions, but nature, culture and the subject as well. This more holistic understanding of economy should be taken under special consideration when we are talking about economic crisis, and ask, what exactly is in crisis and what is the role of economy in relation to this?

When we are talking about economy we are never talking only about business as usual. This is just the surface of a more deep-rooted and fundamental philosophical idea. Economy is basically a combination of some abstract ideas like utility, value, exchange and markets, applied to everyday life. By understanding most human actions and social relations within the fields of utility, value, exchange and markets the discipline of economy makes it possible to interpret activities as work (value), things as products (utility), distribution as trade (exchange), cooperation as competition (markets) and so on. Here utility is the fundamental motivation for doing things; value is the measurement of people and things, which are related to each other throughout different transactions and this happens in the sphere of freed or limited — but still — markets. These same abstractions can be found in all modern economic ideas as such or as simple negations, just as they belong to all mainstream political ideologies from left to right.

By reading history one can notice that the idea of economy, as we understand it now, is a relatively new concept. So-called uncivilized cultures did not have anything comparable to our economic conception at all, even though they were definitely doing things we could call, or better economize, as production or work. For ancient Athenians οἰκονομία (oikonomia) was the custom of household maintenance, and had nothing to do with utility, value, exchange, or markets either. Aristotle stated contrary to the contemporary economic belief that value and exchange — if they are necessary — were not formed by nature nor automatically but by law or custom, “and it is in our power to change [them] and make [them] useless”(2).

Utility, value, exchange and markets were widely included in economic thinking and the European world-view as late as the 17th–18th century soon after the discoveries of new sources of wealth — fossil fuels3 (black coal and oil) and colonialism. According to historians of political economy, this inclusion came about on account of a relatively small minority of people who wished to establish a new foundation of power, against Crown and Church. In practice, this occurred in the realization of large scale land privatizations at home or in recently occupied colonies abroad, bringing about new social structures, means of production, and capitalizing their appropriated wealth. Economy and its philosophical basis did indeed voice some optimism about general prosperity but it was mainly used as a theoretical foundation to legitimate the law and order required for these processes of exploitation. The term political economy was introduced in the 18th century. Very soon after that most of the European states were more or less based upon the theories of economists and similar economic theories were adapted by the critics as well.

brockville-carriage-co-engraving-ca1892It is important to point out that all previously mentioned economic developments happened as a part and continuation of the scientific revolution and followed the tide of a scientific world-view. And indeed in the end of the 19th century the term economics replaced the term political economy and finally became “the recognized name of a science”(4). If post-Newtonian science was all about the creation of harmonious rational systems (like classical mechanics for physics, Kant for ethics or Hegelianism for political history which Marx later economized) based on laws and striving for the truth, so was economics. However, the early modern scientific world-view had some severe problems with handling individuality or exceptions.

At the dawn of the 20th century a few turning-points happened that gave rise to the wider economization of knowledge. First of all, some thinkers started to doubt the unity and harmony of “the reality” early modern science was providing. Sigmund Freud and his psychoanalytic school came up with the theory of the unconscious, formed by each individual’s personal history, as a source of knowledge. Philosophers, sociologists and other humanistic schools also started to shake the unity of scientific world-views and focus upon the particular (the unit, the atom, the subject). This new paradigm divided previously unified knowledge in two: micro and macro. A bunch of new general universal (macro) preconditions were needed to be able to define something that is particular (micro). These theories generated structuralism, that was finally vulgarized into popular post-modernism.

A good and illustrative example of this division of knowledge is macroeconomics which divided the economy in two different spheres. The economy itself was understood as a universal self-sufficient macro phenomenon that functions independently beyond any mortal control, but was constructed from countless micro-economic events of everyday production and consumption. However, these two levels were not connected theoretically. A similar division occurred in the natural sciences as well. Quantum mechanics was able to offer a theory of a general structure of the Universe, but was not combinable with classical natural science.

The philosophy of knowledge (e.g. epistemology) reacted to these developments by concluding that knowledge is formulated in a certain discourse, for example socially. What is revealing here (in the discourse of economization) is that some of the epistemologists proposed that a truth value of scientific theory is evaluated by the success of the theory — in other words how well it succeeds in the markets of knowledge.

I hope this hasty overview contributes to an understanding of how knowledge was liberated (in terms of Liberalism) from a solidified and homogenous classical paradigm, but was paradoxically not freed from a similarly homogenous idea of the new universality: the markets of knowledge. This means that knowledge has became dominated by one epistemological trend — not physics nor philosophy — but economy. One could call this the great economizing process of knowledge. Most notably this has happened in the humanistic sciences and to something we call a ‘human being’, the subject or the self.

Economization of the self

As I argued in the last section, the process of economization proceeds together with an emancipative liberation process where old meanings are re-evaluated and new ones constructed. This kind of liberation process of the western subject has happened on two levels. First, a promise of liberty has been classically granted throughout financial success and consumption — arbeit macht frei. Second, it has happened on the level of identity which the Euro-American intelligentsia has been actively recording since the early 20th century. Paradoxically, the latter has often been theorized by the same thinkers that criticize the former one. In the end these two ideas have very little difference.

Criticism of financial liberty can be summarized as concealing an idea of capitalistic exploitation — like marxists should say; it does not really liberate anyone. But this discussion is overdone and not so important here. What I am more interested in is the liberation process of the human being or the subject, that has been a big project of left and right liberals since the 19th century, which was addressed against all reactionary forces and conservative normativeness. This process has been very important in many senses, but still fundamentally a dramatic failure in terms of constituting the macro-economic idea of humanity that the liberation of science did for knowledge.

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By declaring everybody’s equality, the liberation of the subject ended up by assuming universal human worth as a basic value and the idea of equality as a fundamental starting point for normativeness and comparison. This general valorization of the human has separated each subject from all subjective qualities and transformed the idea of the human into something that is comparable to currency. Even every human will wear and erode with time but retain the same value, just like a ten euro bill. To study what the basic unit of human worth is one just need take a brief look at the most bare and unveiled persons of the society, those who have no signification or status other than their species. Combining this notion with an observation that the liberation project developed inside an economizing world, using economic terms and discourses, we can see how good-hearted liberalism created a subject that has to be invested in the market to succeed and gain more value in order to be something. The problem lies in the very idea of liberty itself that is more an operational environment than quality of the self. Even clever thinkers like Michel Foucault could not really avoid this kind of economism, when he said that the modern subject should become un objet d’art(5). Art is definitely a commodity that exists in markets. Also, some early radical nihilists, as Sergej Netjajev, were trapped in the same conception. For Netjajev, a revolutionary should be seen as revolutionary capital that “should, of course, be spent as economically as possible in order to derive from it the greatest possible profit”(6), as he did himself, by telling his comrades to kill Tsar Alexander II of Russia instead of spending their time on trying to free him from prison.

One could ask what is wrong with the liberty of free markets and answer with the criticism that an equal basis for subjects and free markets has never existed. These ideas bring the topic closer to the analysis of the true meaning of the crisis that I will present in the next section.

First of all, it is important to notice that there are some differences between left and right liberalism, but even more important to recognize is that there is also a lot in common. A quarrel about communalizing or freeing the markets is less important, since both of them are trying to establish a freed but economic subject, aiming at universality and productivism. Second, one should not confuse liberal theories with liberalism as a political project. The former is an incompetent salvation doctrine among many others and basically used to legitimate the latter. Practically, the latter does not correspond with liberal theory as it has been historically established through dictatorship (i.e. Pinochet’s Chile and the Soviet Union), a strong bureaucratic state (social democrat Scandinavia) or global authorities like WTO, World Bank, NATO and so on (the governments of Reagan and Thatcher). These political projects have not been free nor liberal, but were certainly economic.
Despite all the great efforts of left wing liberalism, the idea of economy itself has become almost identical to right wing liberalism, as the economic epistemology that the idea implied supports mainly right wing values. This is why strong polarized political divisions in mainstream politics do not really exist anywhere in Europe. The New Left can somehow make it out after a big step towards the liberal right by accepting the same economic discourse. But, in the end, the problem of economization stays more or less the same and seems to work for the right liberals or, alternatively, for neo-fascist ideologies as its defective negation. In spite of the anti-liberal agenda of fascism (that seriously contradicts the liberal theory), fascism seems to benefit pragmatic political liberalism which needs some sort of social Darwinism and totalitarianism to maintain the free market ideology. This explains the close relations of the liberal right and neo-fascists.

Like reactionary ideologies, economization is based on an inadequate interpretation of the real world and the subjects, and suggests artificial universalism or naturalism, and needs strong and repressive power mechanisms to exist. This is not only the case with market liberalism but the liberal idea of the self as well — both just use different tactics of power. As Aristotle already noted, markets — even free markets — are based on law and do not function without the classical legislative and repressive powers: state, justice, police, army, and different technologies of control. Consequently, the liberal subject controls itself by self control. To be able to succeed in the market of identities, one has to adapt certain successful presentations and trends of the self — like sexuality, gender, style, diet, ideology, religion, nation, class, and so on, that we better know as identity politics. Liberty surely opens a theoretical path to creativity and real variation, but practically, competition and unavoidable privileges that the system requires to be maintained, seem to restrain the diversity and liberty of each person. Together these two spheres of power — external and internal — constitute something comparable to the Deleuzean concept of control that is all inclusive. This is a fairly good representation of how economic hegemony works, even though I don’t agree with the totality of the idea of Deleuze.

Economy of crises

Now I have defined economy as a comprehensive epistemological system, including not merely business as usual but a great deal of knowledge and the subject as well. I have explained how the project of liberalism has incorporated the whole economic discourse into right-wing ideology and how the economy operates on two different levels of repression: external and internal. From this position we can, finally, make some observations about so-called economic crisis.

monopolyThe first and most prominent note is that economy as an interpretation of reality is not in crisis nor is the process of economization. Economic crisis would literally mean that everyday reality would correspond less and less to economic thinking and this indifference would
derail the idea of economy into crisis. What we have seen in the last century is quite the contrary and the current crisis is just one example of that. By intimidating people with poverty, crisis draws them even closer to utilitarianism, competition and markets in favour of even harsher economization.

So, if the economy still works well, where is the error and what is the source of growing anxiety and suffering? What is the idea that does not correspond anymore with everyday reality? I would say that there is no error. Anxiety and misery are just a result of bad economic success and what does not correspond with reality is the optimistic economic idealism that has become the dominant ideology during the period of economic growth. Financial success created a misconception that surplus and economy are synonyms even though the success is just one side of the coin. Economy as a doctrine of salvation bears fruit only in circumstances of economic growth. This deduction is surely cynical and sad, but it strictly follows the logic of economy. However, it opens an interesting philosophical view that partly explains why the hegemony of economy is so strong and all- inclusive that even the collapse of idealism does not destroy it.

In the crisis, the discipline of economy is able to combine spiritual and material spheres that some philosophies have classically divided. This happens through internal and external power. But, before I go into details the theory needs some preparation.

It seems that there is something specific about the current crisis. It is happening at an historical moment, when the business economy has already consumed a big part of its own material bases — mainly oil and phosphor — and created noteworthy environmental problems that cannot be ignored much longer. There is plenty of discussion about the material imbalance between the demand and supply of fossil fuel and the critical state of climate, soil and water resources as one of the causes of the current global crisis. This was surely to be expected as the essence of economy is unlimited competition and success. Even early economists, as Thomas Malthus, predicted this already at the end of the 18th century. However, this reality gives a special character to this ongoing crisis in comparison to other historical crises. If I’m wrong here and some new resources are found, it does not really matter since the dynamics and direction of economy will explode and consume them anyway. By saying this, I do not mean that we have an economic and environmental imperative to act upon. No, just that these are only the conditions of the economy.

What this means in practice is that some sort of optimistic expansion of wealth has stopped and the invisible hand that was supposed to self-regulate the markets in order to benefit the whole society has become paralyzed — if it ever existed. From now on, surplus is a privilege for fewer and fewer people simply because of material reasons. However, what the crisis is proving against common optimism is that surplus is necessary for creativity and imagination. Day-to-day hunger and the struggle for survival in this economic condition does not leave much space for daydreaming, and creativity has surely become more worldly, purposeful, and economic than ever in modern times. Unemployment does not just mean more free time, like it meant during the times of the wealthy social welfare state.

It is important to make clear that poverty and suffering are not based on real shortages of food, houses and other wealth. It is the economy which establishes the order and controls material resources, human activities and the distribution of things. Under other circumstances there would not be this kind of scarcity.

But let’s go back to the current crisis. What is happening now is that lack of surplus pushes the whole project of economy in a more material direction. This movement — from ideal and theoretical into material and practical — is important here. In other words, during the crisis previously metaphysical economic ideas are clearly becoming hard reality and the situation is forcing people to be truly economic subjects: utilitarian, competitive, calculative and selfish. It does not matter if these qualities describe true human nature or whether economic theory is well argued or not. Economic hegemony does not provide any other choices. This is guaranteed by bureaucrats, tax officers, cops and judges and the little economist inside our heads who commands us to calculate and prioritize. And this is how spiritual and material become one. The tools are repression and violence and the result, the totality of “one truth”.

As we have seen during the crisis, the materialization of the imaginary or of metaphysics enforces economic order and rearranges power relations. The period of financial surplus that started around the 18th century established metaphysical — ethical, idealistic and imaginative — power structures. It surely takes a lot of imagination and idealism to unify a diversity of people into a nation, nation-state or proletariat, and all these entities had a significant share in political power. However, austerity policy shows how old divisions of power (nation-state, voters, labor movements and unions) are losing their share of power to global free market organizations, corporations and supranational powers like WTO, IMF, NATO and EU. The state that used to be sovereign is mainly a tool of governing for the desires of the new sovereignty. Here we should remember the classical anarchist criticism of the nation-state, parliamentarianism, democracy, class division and all other structures and declare that while the new normality is bad the previous was not good either. Despite the materialization of economized “reality” all kinds of philosophy and idealism are still possible, but the important thing is that they have less and less effectivity.

Unfortunately, to establish new epistemologies or even destroy the existing one needs some non-utilitarian creativity, imagination and daydreaming. The alternatives that we now and then hear of are more or less different reproductions of existing economic hegemony. In brief, an economic solution — Marxism, national socialism, Keynesianism, Third Way, Degrowth, Transition Movement, techno utopias or even collectivism, syndicalism or federalism — might rehabilitate the doctrine of salvation for a period but cannot deal with the fundamental question that is not technical but epistemological. It is all about how we understand humanity and the world.

So, let us summarize the previous. The crisis is one convention of economization, a new form of economic control and the new normality. That is why the term ‘economic crisis’ is misleading. Economy of crisis describes the situation best. What happens in the crisis is that the idealistic economy will be violently transformed into pragmatic economy violently through poverty and repression. By doing so economic metaphysics and imagination will become the material, hard reality. This creates a degenerative closed circuit that — as we can see everywhere — wears away knowledge, ethics and environment; in other words, the foundations of all alternatives or change. However, a closed circuit does not provide vitality for life. It needs metaphysics and imagination in order to do so. Any kind of economic reform cannot solve the situation, only reproduce it in other forms. This all sounds very pessimistic, and it seems that we are doomed to ultimate decadence and a dead end. But this is just my use of an old technical trick to build an interesting narrative for a political essay.

Political Nihilism

History has shown that historical knowledge cannot be easily done away with, and personally I do not see any reason for doing so. But what the future can do is to reinterpret old meanings and create new ones. Two recent projects that are active in this field and have challenged economic epistemology are surely radical anarchism and the new nihilism. I do not want to make too strict a conceptual division between them so I will just use the word nihilism, because it sounds more fresh. Also, I do not use the term nihilism as a title. There are rather some things that resemble something we could call nihilism.

However, nihilism could be understood as an unsystematic plurality and self-determinate individuality without any universal, social or atomistic definition of the individual. For example, for a nihilist, a social reality does not need any specific epistemology to exist. Nihilistic thinking cannot claim sociability to be a natural quality of every subject; — but a true anomaly cannot be one either. For nihilism there is no theory, every one is theory — if needed — without artificial causality or interpreted relations imposed from the outside. From this point of view, nihilism has already overstepped universal economic abstractions, like value in a material, spiritual and ethical sense but also the idea of nihil as one undivided nothingness. The nihilist project is not against knowledge itself nor qualities of each individual but authoritarian forms of those.

What I’m going to present next might be a misinterpretation, but as I have come so far with my analysis let me be excused if I’m wrong. The development of new nihilism can be connected to this historical moment we are living now with two points. First, one could even say that nihilism has been finalizing liberal thought by liberating it from liberalism. This could be seen as a Nietzschean antagonistic position against postmodern constructionism (that interprets reality throughout micro and macro divisions), denying it as a false concept. Second, some recent nihilist practices could be seen as opposing the general materialization of economic ideas, with the potential to breathe new life into metaphysics and imagination. However, this hypothesis needs a bit more flesh on the bone.

As I argued in the last section, economic hegemony and especially the imperative of crisis suppress imagination. The power of pragmatic economy (scarcity and cops) has severed all alternative, non-economic world-views and philosophic ideas from everyday reality, condemning them to isolation. Only one philosophy can access reality and that is non-discussable and materialized, vicious, economic metaphysics: utility, value, exchange and markets. If the moment is impossible for theoretical philosophy and life has been materialized, the political conclusion should be that new philosophical arguments have to be presented in pragmatic form as well.

Recent political activities undertaken by nihilists appear to follow this interpretation. Arsons, robberies and other forms of direct action can be seen as pragmatic philosophical arguments. If we read nihilist responsibility claims and other texts, we can find out that there is no reproduction of economic epistemology, nor do they provide new economic systems, any general social theory, universalities or other single-minded “truths”. This distinguishes nihilists from all other political projects. However, nihilist insurrection and destructive actions are surely communicating philosophical meanings and proposing practical approaches to metaphysical questions — what is ultimately there and what it is like — by placing individual ethics above all and opening a sphere of organic social relations and unceasing variation.

We believe that each person makes up, for themselves, an entire universe. From this lens, everything is subjective. Our very life is our personal narrative, through our own eyes. This is why we do not believe in objective conditions that assimilate and accept a single and exclusive objective and revolutionary truth. There is not one reality, but countless realities. We do not accept mass production of revolutionary consciousness, subversive experiences, or liberating gestures.(7)

Thomas Hobbes was partially right by arguing that a “state of men without civil society is nothing else but a mere war of all against all; and in that war all men have equal right unto all things”8. But, one thing he did not get is that ‘war on society’ does not “mean mass death, but the death of social norms”(9). This state of divine violence — that does not constitute power, only dissolves it — is the death of the homogenous universal subject, “the All”, and all other allnesses which try to dominate how brutal or tender we are, where, when and why.

— Anonymous

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End notes:

1. Koray Çalışkan and Michel Callon, “Economization, part 1: shifting at- tention from the economy towards processes of economization”, 2009, Economy and Society 38(3): 369 – 398
2. Aristotle, Nicomachean Ethics
3. Philosphers of the Future, The Barbarian 1/2013, pp. 4-15
4    W. Stanley Jevons, The Theory of Political Economy!, 1871, pp. xiv-xv
5. Michel Foucault, ”Conversation avec Werner Schroeter”, 1982, Werner Schroeter, Paris, Goethe Institute, pp. 39-47
6. Sergei Netjajev, ”The Revolutionaty Catechism”, 1969, http://www.marxists.org/subject/anarchism/nechayev/catechism.htm
7. Short interview by Contra Info translation counter-information network with Conspiracy of Cells of Fire members, ten comrades currently incarcerated in Greece, April 2013, http://en.contrainfo.espiv.net/files/2013/08/interview_en.pdf
8. Thomas Hobbes, ”The Elements of Law, Natural and Politic: Part I, Hu- man nature and De Corpore Politico”, pp. xvii
9. Short interview by Contra Info translation counter-information network with Conspiracy of Cells of Fire members, ten comrades currently incarcerated in Greece, April 2013, http://en.contrainfo.espiv.net/files/2013/08/interview_en.pdf

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