The Power at the End of the Economy - Softcover

Massumi, Brian

Softcover

ISBN 10: 0822358387 ISBN 13: 9780822358381

Publisher: Duke University Press, 2014

Synopsis

Rational self-interest is often seen as being at the heart of liberal economic theory. In The Power at the End of the Economy Brian Massumi provides an alternative explanation, arguing that neoliberalism is grounded in complex interactions between the rational and the emotional. Offering a new theory of political economy that refuses the liberal prioritization of individual choice, Massumi emphasizes the means through which an individual’s affective tendencies resonate with those of others on infra-individual and transindividual levels. This nonconscious dimension of social and political events plays out in ways that defy the traditional equation between affect and the irrational. Massumi uses the Arab Spring and the Occupy Movement as examples to show how transformative action that exceeds self-interest takes place. Drawing from David Hume, Michel Foucault, Gilles Deleuze, Niklas Luhmann and the field of nonconsciousness studies, Massumi urges a rethinking of the relationship between rational choice and affect, arguing for a reassessment of the role of sympathy in political and economic affairs.

About this title

About the Author

Brian Massumi is Professor of Communication at the University of Montreal. He is the author of several books, including What Animals Teach Us about Politics and Parables for the Virtual: Movement, Affect, Sensation, both also published by Duke University Press.

Excerpt. © Reprinted by permission. All rights reserved.

The Power at the End of the Economy

By Brian Massumi

Duke University Press

Copyright © 2015 Duke University Press
All rights reserved.

ISBN: 978-0-8223-5838-1

Contents

1. The Inmost End, 
2. A Doing Done through Me, 
3. Beyond Self-Interest, 
SUPPLEMENTS, 
I. The Affective Tasks of Reason, 
II. Keywords for Affect, 
Notes, 
Works Cited, 
Index, 

CHAPTER 1

The Inmost End

The hypothesis of a calculable future leads to a wrong interpretation of the principles of behaviour which the need for action compels us to adopt, and to an underestimation of the concealed factors of utter doubt, precariousness, hope and fear. —John Maynard Keynes, "The General Theory of Employment" (1973, 122)

We are enjoined to rational choice. We are taught that our freedom is one with the freedom of choice. We are told we become who we are by how we choose. We are assured that if we choose well, according to our own best interests, we will end up serving the interests of all. We are told that there is a mechanism in place to ensure this convergence between our interests and others'. Market is its name. Its "invisible hand" adjusts best choices to each other, its magic touch guided by the principle of competition. Competition weeds out suboptimal choices, selecting for efficiency. Efficiencies multiply each other, minimizing effort and maximizing profit for all. The market, we are further led to believe, is self-regulating. It has a natural inclination toward optimization. As political subjects, we are enjoined to vote, rationally, in its interests so that we may pursue our own, for the general good. Rationally, the political subject coincides with the economic subject of self-interest that we all are fundamentally, in private pursuit of happiness. And what, if not that, gives meaning and motivation to our lives? We are all paying guests at the tea party of choice, spreading our favorite jam on our very own slice of the bread of life, served on the silver platter of efficiency by the invisible hand.

But on closer inspection, a rabbit hole appears at the heart of the market. It plummets from the apparently solid ground of rational choice to a wonderland where nothing appears the same. Affect is its name. The "concealed factors" of doubt, precariousness, hope, and fear—and (why not?) love, friendship, and joy—tend to bubble back up to the surface with rowdy abandon. In today's version of free-market ideology, neoliberalism, the affective commotion has become so insistent that something else surfaces as well: the creeping suspicion that it is upon the groundless ground of these now not-so-concealed factors that the edifice of the economy is actually built. Efficiencies, we are still assured, multiply each other. They lasso each other, bootstrapping the economy out of its periodic crises into a provisionally stable order that we are still entreated to consider rational. But when markets react more like mood rings than self-steering wheels, the affective factor becomes increasingly impossible to factor out. It becomes obvious that the "rationality" of the economy is a precarious art of snatching emergent order out of affect. The creeping suspicion is that the economy is best understood as a division of the affective arts.

The implications of this groundless grounding in affective artistry are worth a look, not least for what it might say about "rational" self-interest as the guarantor of self-optimizing order, but also for the rethinking it might necessitate of the very concept of the rational in its relation to affect. Michel Foucault provides a provocative starting point in his 1979 lessons on the genealogy of neoliberalism (Foucault 2008).

The Market in Wonderland

The "invisible hand" makes at least a cameo appearance in every discussion of the free market. Foucault's is no exception. As its inventor, Adam Smith, conceived it, Foucault argues, the concept of the invisible hand had nothing of the godlike quality that has come to be attributed to it. The whole point of the concept was that the economic system is too churningly complex for there to be any possibility of a lordly overview upon it. In his genealogy of neoliberalism, Foucault makes the point in no uncertain terms: when it comes to things economic, there is no "total transparency" (Foucault 2008, 279). Not only is there no total transparency—there is no transparency or totality. The concept of the invisible hand, as Foucault interprets it, is a principle of blindness in an open field of ceaseless activity whose contours, always shifting, are by nature indefinite. "Being in the dark and the blindness of all the economic agents is an absolute necessity" (297).

For neoliberals, this is actually a good thing: it makes economic liberalism unavoidable. It means that the economy can have no sovereign. The invisible hand actually means "hands off." The liberal's principle of laisser-faire, Foucault quips, becomes for the neoliberals "do-not-laisser-faire government": tie the government's hands (Foucault 2008, 247). Foucault is quick to add that in practice neoliberalism entails a large and even expanding range of forms of governmental intervention. But these are designed, paradoxically, to maintain the ability of market mechanisms to self-organize the economy free from undue government interference (175–176). They do not operate from a position of sovereign command. They are in the midst. Any governmental attempt from on high to weave the strands together into a well-defined, predictably regulated whole will just fray the fabric to the ripping point. Government purports to act all-knowingly in the general interest, and in its hubris always fumbles. Individuals, too, are under the injunction, in the name of the general good, to act without regard for it. For it is only then that the "invisible hand" can work.

But it's not a hand at all. It's an accumulation of little-handed decisions which end up serving the general good in spite of being self-interested. Individual decisions, made in the darkness of self-interest, percolate through the field. To the extent that the results of these decisions form positive feedback loops, they give rise to mutually beneficial multiplier effects and there occurs a "spontaneous synthesis" of what's best for all (Foucault 2008, 300). The synthesis is entirely involuntary with regard to each individual (275–276). This "rationalization" of the economy to which the subject of interest's decisions involuntarily contribute is an emergent property of a complex, self-organizing system: a novelty and a creation, forever self-renewing. The synthesis, Foucault continues, is a "positive effect" of an "infinite number" of "accidents" occurring at ground level in the "apparent chaos" (277), or quasi-chaos, of the market environment. These are bound together by a "directly multiplying mechanism"—competition—which, Foucault emphasizes, operates in the absence of any form of transcendence (275–276). In other words, the positive synthesis of market conditions occurs immanently to the economic field. The choice of the subject of self-interest rabbit-holed in that field of immanence is "irreducible" and "nontransferable" (272). It is "unconditionally referred to the subject himself" (272). At its core, Foucault says, the liberal economic model is one of "existence itself": it concerns first and foremost a relation of the "individual to himself" (242).

This is existence in its dissociative dimension. Here, in its relation to itself, the subject circles itself more and more tightly around its individual power of choice, like a dog to sleep, wrapping itself centripetally around a center of promised satisfaction. It circles in on itself, away from the social, unmindful of noneconomic societal logics. But it all works out for the best for society in the end, they say, thanks to the positive synthesis of multiplier effects. Relation to oneself involuntarily amplifies across the multiplier effects to become a systemwide social fact. The inmost dimensions of individual existence are operatively linked to the most encompassing level, that of the market environment that is the economic field of life. What is most intensely individual is at the same time most wide-rangingly social. The smallest scale and the largest scale resonate as one, in a quasi-chaos of mutual sensitivity. To relate self-interestedly to oneself is in the very same act to relate, involuntarily, to everyone else.

But there is a problem. It has to do with the future. Success, of course, is not guaranteed for any particular act, or any particular individual. The self-organizing of the system at the largest scale can synthesize its way past many a microfailure. As choices percolate through the economic field, the negative impact of individual failures is compensated for overall by the multiplier effects of the successes. Given the infinity of accidents riddling the economic field of life and the existential blindness of all economic actors, there is an ever-present threat of a misstep. Every economic calculation is a calculus of risk. "Behavioral finance (psychology) and rational actor models (the 'rational economic man', or REM) rarely emphasize how uncertainty differs from risk and probability" (Pixley 2004, 18). You can calculate risk in terms of probabilities, but probabilities by nature have nothing to say about any given case. The affect accompanying uncertainty is there in any case. Choices in the present become highly charged affectively with fear for the uncertain future. The present is shaken, tremulous with futurity. There is no calculus of risk independent of an individual's affective self-relation to uncertainty.

Even in the best-case scenario, rationality and affectivity cannot be held safely apart. Unlike the juridical subject of the law and the civil subject of society, the economic subject of interest is never called upon to renounce its self-interest for the general good. Self-interestedness remains "unconditional." It is measured in satisfaction. We have been successful in our self-interestedness if we have attained satisfaction for ourselves. What the economically productive subject of interest ultimately produces is its own satisfaction (Foucault 2008, 226). Paradoxically, the measure of how "rationally" a subject of interest behaves can only be measured affectively, in the currency of satisfaction. Rationality and affectivity are joined at the self-interested hip, in one way or another, for better and for worse. "Emotions function in the core structures of the financial world" (Pixley 2004, 18).

The subject of interest is never called upon to renounce self-interest. But it is frequently called upon to defer the very satisfaction by which its self-interest is measured. Feeling insecure? Be reasonable. Defer your satisfaction to a more secure time of life. Work toward retirement. But this is a rational choice only if you trust the system's self-organizing. This is an increasingly difficult sell as crises follow each other in rapid succession. Each crisis is a shock to the system, at all scales. Uncertainty starts to feed on uncertainty. Fear builds into panic. Negative multiplier effects take over. Household savings vaporize and national economies crumble. Suspicions grow that the invisible hand suffers from a degenerative motor disease.

All signs are that the condition is congenital. Crisis no longer seems a punctual interval between periods of stability. Crisis is the new normal. That this should be the case only stands to reason. The premise of any rational calculation is that similarly strategized actions will yield similar results. But the whole point of an economy that selects for creative multiplier effects is that multiplier effects are nonlinear. By definition, they are effects that are not commensurate with their causes, even if the causes be known. The whole point of capitalist enterprise is to "leverage": to extract a surplus yield of effect over and above what would normally be expected to follow from an investment. The capitalist process is driven by the potential for, and yearning after, an excess of effect over any given quantity of causative input: surplus value. The more complex the system is, the more uncertain the future becomes. And complexification has been a constitutive tendency of the capitalist system from its beginnings. Capitalism, always a far-from-equilibrium system, is becoming ever more so. The same multiplier mechanism that promises future satisfaction makes it exponentially less certain.

Why defer satisfaction if the capitalist future is constitutively uncertain? But on the other hand, how can you not play it safe by deferring your satisfaction, precisely because the capitalist future is so uncertain? This conundrum of deferral is an expression of the paradox that neoliberalism's promise of satisfaction unnerves the rationality it extols, giving it the affective shakes that cannot be cured. The rational risk calculations of the subject of interest become more and more affectively overdetermined by the tension between fear of the future and hope for success, and between satisfaction and its uncertain deferral. The embrace of rational self-interest and affective agitation becomes all the closer. They fall all the more intensely into each other's orbit, to the point that they contract into each other, entering into a zone of indistinction, at the heart of every act.

It's a vicious circle. Positive multiplier effects can be counted on only when individuals' rational choices mutually reinforce each other, catching like a contagion. This is the point at which rational choice is indistinguishable from "irrational exuberance" (in the legendary phrase of US Federal Reserve chairman Alan Greenspan). This is also precisely the mechanism that forms speculative bubbles leading to crisis. More radical than the fact that the same mechanism that promises satisfaction makes it exponentially less certain is the fact that the attainment of the very satisfaction promised can itself bring on a crisis. The tired hound of self-interest, circling in for satisfaction, traces its own private vicious circle in its self-relating movements. Its sleep will be agitated. It will twitch with dreams of disappearing rabbits.

System Distrust

In times of crisis, the first words out of the mouth of any economic leader are: "we must restore trust in the system." But as systems theorist Niklas Luhmann blithely observed, under these endemic conditions "trust rests on an illusion" (Luhmann 1979, 32). In a chaotic economic field personal relations of trust are impossible to guarantee. "In actuality, there is less information available than would be required to give assurance of success" (32). "Linear causal explanations come to grief" (83). However well intentioned other parties may be, they cannot be trusted. The nonlinear dynamics of the economy could well frustrate their best intentions. What's an enterprise system to do?

If relying on personal bonds of trust is out of the question, there's only one option: "depersonalize" trust. Make it "impersonal" (Luhmann 1979, 93). Entrust the system. "System trust" is the only answer. But how does an individual trust a system that doesn't trust itself to follow its own line? "There must be other ways of building up trust which do not depend on the personal element. But what are they?" (46). Luhmann has an ingenious answer to his own question. You actually "shift forward the threshold of effective distrust" (75). In other words, you foster distrust as a starting condition (88). You foster distrust, but not as the opposite of trust: as its "functional equivalent" (71).

What on earth does that mean? It means that you "interlock them so that they intensify each other" (Luhmann 1979, 92). You bring trust and distrust together into a zone of indistinction where they are in such immediate proximity to each other that one can easily tip into the other at the slightest agitation. They resonate together, intensely. As actions are taken, the resulting affective state of the individual oscillates between them. Foucault notes that the "horizon" of the neoliberal field of life is one of increasing differentiation that is constitutively open to "oscillatory processes" (Foucault 2008, 259). By differentiation, he is referring to capitalist society's overspilling of disciplinary modes of power based on normative models imposed on the individual, and the accompanying proliferation of "minority practices" (259). When he mentions oscillatory processes he is talking about the fluctuation of economic indicators such as salaries, job creation figures, industrial orders, and most fundamentally prices, which mark the ups and downs of the system's self-regulatory mechanisms. But the same description applies equally well to the smallest unit of the economy, the enterprising individual, as it does to the system as a whole. On the individual level, trust and distrust interlock and intensify each other, resonating together in immediate proximity, forming their own oscillatory system. As do fear and hope, satisfaction and self-denial, all in it together.

The individual subject of interest forming the fundamental unit of capitalist society is internally differentiated, containing its own population of "minority practices" of contrasting affective tone and tenor, in a zone of indistinction between rational calculation and affectivity. In other words, there is an infra-individual complexity quasi-chaotically agitating within the smallest unit. The individual remains the smallest unit despite this infra-level complexity, because what resonates on that level are not separable elements in interaction. They are intensive elements, in intra-action (Barad 2007, 33). They are immediately linked variations, held in tension, resonating together in immediate proximity. Their oscillatory co-motion expresses itself at the level of the individual, where it is marked by fluctuating indicators, just as the actions of individual economic actors express themselves on the systemic level in fluctuating indicators such as prices. We call the indicators of the intra-action occurring on the infraindividual level moods. "Moods," Gilbert Ryle writes, are like "the weather, temporary conditions which in a certain way collect occurrences, but they are not themselves extra occurrences" (Ryle 1949, 83). Moods collect infra-occurrences and sum them up in a general orientation giving direction to the next level up, just as price fluctuations collect the microeconomic decisions of individual actors and sum them up in the general orientation of the economy as a whole.

(Continues...)

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Edition details

• Publisher: Duke University Press
• Publication date: 2014
• Language: English
• ISBN 10: 0822358387
• ISBN 13: 9780822358381
• Binding: Paperback
• Number of pages: 144