In one form or another and in varying degrees, Marxists have generally adopted modes of analysis which, explicitly or implicitly, treat the economic ‘base’ and the legal, political, and ideological ‘superstructures’ that ‘reflect’ or ‘correspond’ to it as qualitatively different, more or less enclosed and ‘regionally’ separated sphere.
This is most obviously true of orthodox base-superstructure theories. It is also true of their variants which speak of economic, political and ideological ‘factors,’ ‘levels’ or ‘instances’, no matter how insistent they may be about the interaction of factors or instances, or about the remoteness of the ‘last instance’ in which the economic sphere finally determines the rest. If anything, these formulations merely reinforce the spatial separation of spheres.
Other schools of Marxism have maintained the abstraction and enclosure of spheres in other ways – for example, by abstracting the economy or the circuit of capital in order to construct a technically sophisticated alternative to bourgeois economics, meeting it on its own ground (and going significantly further than Marx himself in this respect, without grounding the economic abstractions in historical and sociological analysis as he did). The social relations in which this economic mechanism is embedded – which indeed constitute it – are treated as somehow external. At best, a spatially separate political power may intervene in the economy, but the economy itself is evacuated of social content and depoliticized. In these respects, Marxist theory has perpetuated the very ideological practices that Marx was attacking, those practices that confirmed to the bourgeoisie the naturalness and eternity of capitalist production relations.
Bourgeois political economy, according to Marx, universalizes capitalist relations of production by analysing production in abstraction from its specific social determinations. Marx’s approach differs from theirs in his insistence that a productive system is made up of its specific social determinations – specific social relations, modes of property and domination, legal and political forms. This does not mean simply that the economic ‘base’ is reflected in and maintained by certain ‘superstructural’ institutions, but that the productive base itself exists in the shape of social, juridical and political forms […]
Although Adam Smith was responsible for coining one of the most popular slogans for describing how a market economy operates, its semantics are determined by two further aspects. On the one hand, if we follow the tangled history of the “invisible hand” metaphor, we can see how through this metaphor theological and cosmological questions were deposited in the field of social ontology. A century before Adam Smith, for instance, the metaphor referred to something secretly at work in relations between natural things, a cosmological phenomenon that, like the mechanism of a clock, hides behind the clearly visible hands and dial: “For Nature works by an Invisible Hand in all things.” […] The manus gubernatoris of Scholastic philosophy, the guiding hand of God invisibly directing all Creation, returns as an influential theological metaphor for the Providence manifest in the natural order, the oeconomia naturae. And before the “invisible hand” appeared in Wealth of Nations as a topos for the law-governed activity that turns self-interest and the striving for gain to the general good, this expression occurred in Smith himself in an entirely different yet equally significant context.
In his History of Astronomy, probably written around 1758, not only did Smith attempt an apologia for the Newtonian world system, with its laws of gravity and inertia; he also casually remarked on the inability of polytheistic religions to trace irregular events in the natural world — events in which they saw the miraculous power of the ancient gods at work — back to regularly occurring patterns. While it is only natural that “fire burns and water refreshes,” or that “heavy bodies descend and lighter substances fly upward,” extraordinary phenomena such as lightning, thunder, or storms call for explanation — and for this the ancients would in the end simply turn to Jupiter’s “invisible hand.” […] Here too the invisible hand is treated as a cosmological fact; and just as an invisible hand will later bring the unpredictable inclinations of self-seeking subjects to order, so too here an invisible hand shows how irregular natural events manifest the workings of divinely ordained laws. As a result of such supernatural intervention, earthly matters are brought into conformity with Providence, irregularities are translated into order, and diffuse forces and movements [p.26] are made to bear witness to an invisible power linking them together. All this activity by invisible hands indicates that hidden manipulations — in the most literal sense — intervene both in the natural course of events and in the dynamics of social interaction.
On the other hand, it should not be forgotten that Smith presented another version of his concept of the “invisible hand” in the first volume of his 1759 essay on moral philosophy, The Theory of Moral Sentiments. And here homo economicus is defined by more than his failure to see the whole situation, his lack of a comprehensive overview. Economic beings can only function to the extent that they are always missing something even more fundamental. […] Despite or precisely because of their “natural selfishness and rapacity,” the rich share their wealth with the poor. In Smith’s words, this means that […] “they are led by an invisible hand to make nearly the same distributions of the necessaries of life, which would have been made, had the earth been divided into equal portions among all its inhabitants; and thus without intending, without knowing it, advance the interest of the society and afford the means for the multiplication of the species.”
Joseph Vogl, The Specter of Capital (Stanford: Stanford University Press, 2015), pp.25-26.
Put somewhat crudely, we would have to speak here of the emergence of a liberal despotism. […] This momentous moral-philosophical shift was probably first made explicit by the physiocrats […] The market guarantees that natural laws can pertain equally to moral life; and the forces of the market make it possible for economic law, in particular, to represent natural rights in general. […] One inevitable consequence of this overall accommodation to the market is that the distinction, stemming from the modern theory of the state, between civil society and the state of nature no longer makes sense. The market cancels or elides this distinction and eliminates the associated aporias of natural law. It circumvents the social contract and presents itself as a kind of état de nature. [p.30] What later goes by the name of “liberalism” thus first took the form of naturalism, which defined so-called market freedoms primarily in terms of a duty and an obligation: the duty to relinquish control of economic subjects and a corresponding obligation to subordinate governments and their agents to primordial market laws.
Joseph Vogl, The Specter of Capitalism (Stanford: Stanford University Press, 2015), p.29.
Since the Middle Ages, the rudiments of a functioning credit system have been necessary conditions for the expansion of commercial capitalism. […] It is all the more surprising, then, that it was not until the end of the eighteenth century that a sufficiently systematic discussion of banking, capital, and credit mechanisms got underway. This may be due to a delay in the emergence of a systematic science of economics, which was notoriously late in catching up with manifest business practices; but it may also have owed something to a certain theoretical resistance to the fact that a genuinely capitalst structure — one that trades with credit, assets, prospective profits, and hence with time — could no longer be directly translated back into elementary exchange and balance relations. Though people still assumed that there was a balancing dynamic at work in the market, the constant circulation of debt, credit, and capital they observed seemed to contradict this assumption, and they were evidently alarmed by the wide-ranging impact of the economic decisions and actions being taken.
Joseph Vogl, The Specter of Capital (Stanford: Stanford University Press, 2015), p.41.
This brings us to one of the most important component of the new social law and the oikodicy, a defining feature of homo economicus and his milieu, the market. Economic beings are reliable on account of their very limitations, they are social due to their lack of sociality, and it is only through their self-interested participation in trade that they can be brought to serve a purpose extrinsic to themselves. Above all, they best exercise control over themselves and others if they are left uncontrolled. There is nothing — and this will be one of the leitmotifs of the liberalism to come — more harmful than a government that wants to do good. On the contrary, what is called for here is a Mephistophelian agenda, one that takes its cue from a power “which would do evil constantly and constantly does good,” inadvertently producing what is best for all. Civil society, which constitutes itself as the milieu of homo economicus, is governed by the principle of nontransparency or inscrutability; there is no benevolent political actor, possessed of an all-encompassing overview and piercing insight, who might be willing and able to do what is good for everyone.
Joseph Vogl, The Specter of Capital (Stanford: Stanford University Press, 2015), p.24.
The critical mass of events endlessly argued over by economists resembles a picture puzzle in which reason and unreason, order and chaos, a foreseeable course of world events and sheer unfettered contingency appear as indistinguishable. Questions, exegetical efforts, and controversies of this kind weigh all the more heavily since they bear on the validity of one of liberal economic theory’s oldest and most deep-seated convictions: the conviction that market activity is an exemplary locus of integration mechanisms, harmonization, appropriate allocation, and hence social rationality, and that it demands to be represented in a coherent, systematic way. That is why it seems justified to identify, at the very heart of these disputes in the explanatory attempts occasioned by financial crises, the reprise of a problematic that only older attempts to establish a theodicy had been compelled to address with comparable [p.16] systematic rigor. Given that the capitalist economy has become our fate, given too our propensity to look to profit and economic growth to satisfy some remnant of the old hope for an earthly Providence, modern financial theory also cannot avoid confronting the baffling question of how, if at all, apparent irregularities and anomalies can exist in a system supposedly based on reason. In Leibniz’s terms: Which events appear to be compatible (and hence “compossible”) with which other events? Are relations between these events law-governed and if so, by which laws? And how can the existing economic world be “the best of all possible worlds”?
In any case, the questions that Kant used to test whether attempts at a theodicy were at all tenable would have to be directed, by analogy, to justifications of the current financial system. Here too it would be necessary to demonstrate that what seem to be “counterpurposive” and dysfunctional conditions are in fact nothing of the sort; or that they should not be judged as brute facts but as the “unavoidable consequence of the nature of things,” as tolerable side effects of a generally satisfactory world order; or that they are to be ascribed, in the end, to the flawed nature of “beings in the world,” the limited foresight of unreliable human actors.
Joseph Vogl, The Specter of Capital (Stanford: Stanford University Press, 2015), pp.15-16.
Even if the concept of equilibrium has taken different theoretical and epistemological forms on its journey from classical economics, via the marginalists of the nineteenth century, to twentieth-century neoliberalism, these versions share a limited spectrum of basic assumptions. They assume that all market players are interested in maximizing profit or use-value, that a self-regulating relationship between different quantities, forces and other factors obtains, that exchange mechanisms operate most effectively when arbitrary intrusions and interventions are kept to a bare minimum, and hence that the market should be seen as an exemplary arena for the clarification of otherwise inscrutable and opaque forms of social interaction.
Joseph Vogl, The Specter of Capital (Stanford: Stanford University Press, 2015), p. 35.
On the one hand, the rationality of economic transactions is renscribed here in a new code: the exchange “mechanism” becomes the “web” of competition. Competitive societies are understood as being defined less by reciprocal trade relations — as was still the case in the eighteenth century — than by competitive differences or inequalities. And whereas the market once fulfilled the (liberal) natural law of self-interest, it now follows the (neoliberal) idea or form (ēidos) of competition.
Joseph Vogl, The Specter of Capital (Stanford: Stanford University Press, 2015), p.38.
[…] those who operate with such theories do not apply them naively. For it is by no means certain that fully decentralized markets actually exist — markets, that is, that are motivated by self-interest, guided by price signals, and guarantee a perfect distribution of economic resources. The less such abstractions apply to the confused situations that prevail in the real world, the greater is the intellectual onus on political economy to demonstrate that even if there are no such things as ideal markets they nonetheless could exist. In other words, while the assumptions behind such markets may not be “realistic,” they do at least stand a chance of being realized. […] It may be possible to detect the workings of a social imaginary in all this, by which we mean those efficacious fictions [p.35] which inform the self-understanding of societies, coordinate social and symbolic practices, and provide intuitively justified images or self-evident truths to determine how society functions and which options for action are available at any given time.
Joseph Vogl, The Specter of Capital (Stanford: Stanford University Press, 2015), pp.35-36.
When Mr. Thang approached me for money the first time, he did so cautiously, explaining that he needed a hundred dollars to purchase material for school uniforms and pay tuition for his two daughters in high school. At the end of his story, he punctuated his story with a “what do you think of that,” as if he did not quite believe it himself. The image of his school-age daughters caught me off-guard. I quickly convinced myself that I was learning something from him and could — perhaps should — pay him for our conversations as I had paid others for more formal language instruction. So I became complicit in the economy of intimacy in which stories could be exchanged for cash, but without ever outright acknowledging what we each thought the money represented.
Allison Truitt, “Hot Loans and Cold Cash in Saigon,” in Money: Ethnographic Encounters, ed. Stefan Senders and Allison Truit (Berg: 2007), p.60.