Abstract
In his introduction to a new series of books on the recent financial crisis Craig Calhoun argues that ‘today we face an abundance of crises’, and how we respond to these crises will depend on how we understand them (p. 41). Volume 1 of this series, Business as usual: The roots of the global financial meltdown, is an attempt to provide understanding by bringing together the ‘world’s leading social scientists’ to put the crisis in historical perspective. This volume, edited by Craig Calhoun and Georgi Derluguian, presents a thoughtful collection of essays that tackles three main themes: the historical roots of the 2008 crisis, how the crisis might ‘influence transformations of global economic and political relations’, and finally, whether ‘patterns of new possibility’ may supplant ‘older economic relations’ as a result of the recent financial upheaval (p. 12).
The volume is striking in the diversity of perspectives its presents, particularly regarding the historical roots of the financial crisis. Beverly Silver and Giovanni Arrighi contend that the recent crisis illustrates that the US-centered systemic cycle of accumulation has reached its limits and, in the context of previous cycles of accumulation, is a ‘prelude to a terminal crisis of world hegemony and to the rise of a new geographical center of world economic and military power’ (p. 55). Immanuel Wallerstein argues that the 2008 crisis, in combination with deeper structural problems such as rising production costs and pressures caused by Chinese economic growth, has pushed the system permanently out of equilibrium and into a state of ‘gridlock’ (pp. 79, 84). David Harvey and Daniel Chirot point to recurrent tendencies of crisis and, although they diverge on the implications of the recent financial crisis, both suggest that the crisis is a result of inherent contradictions within capitalism.
Other contributors embed the financial crisis within the past three decades of neoliberalism. Nancy Fraser characterizes the recent crisis as the ‘second coming’ of Polanyi’s late-nineteenth century, self-regulating market – a ‘second great transformation’ or ‘great transformation redux’ (p. 140). Caglar Keyder situates his analysis within the breakdown of Fordism, where production and consumption maintained a balance, and the untrammeled growth of neoliberal globalization that has resulted in a global crisis of underconsumption (pp. 160, 169). Manuel Castells emphasizes the central role of technology, pointing to the ‘destructive trends’ induced by ‘deregulated global capitalism’ (pp. 185–186). Gopal Balakrishnan explicitly warns against trying ‘to understand the past quarter century of capitalism in terms of past cycles’ (p. 225), and instead focuses on problems stemming from ‘the transition to a grey capitalism of slow-growth service sectors and aging populations’ (p. 228).
The contributors’ perspectives on how the crisis might transform global economic and political relations are equally diverse. For example, while Silver and Arrighi, and Wallerstein present analyses that draw on centuries of capitalist development, they arrive at different conclusions regarding the transformative impact of the recent crisis. Wallerstein contends that ‘Humpty Dumpty has fallen off the wall’ – that the system is in a state of irreparable structural crisis that has destroyed the viability of capitalism (p. 84). Silver and Arrighi, however, are more circumspect regarding claims of systemic breakdown. They argue that the US-centered systemic cycle of accumulation has produced significant anomalies – such as the sustained dominance of US military power – that preclude a simple projection of past patterns onto the future, and suggest numerous ‘possible’ futures (p. 56).
In the same regard, Harvey and Chirot both look to the contradictions of capital accumulation, but come away with different assessments regarding the resolution or amelioration of these contradictions. Harvey argues that ‘capital accumulation is at a historical inflexion point where sustaining a compound rate of growth is becoming increasingly problematic’ and, as a result, a ‘limit is looming that cannot be transcended’ (pp. 90, 109). Chirot, on the other hand, argues that crises, like periods of economic growth and technological advance, are a natural part of capitalism, and that the problems associated with the recent crisis are ‘entirely curable’ given proper intervention by states and ‘politically powerful elites of the world’ (p. 134).
Other authors are more explicit in their predictions regarding systemic transformation. According to Castells, the crisis has forced states to return ‘from the oblivion of history’ as regulators of financial markets and institutions. This will eliminate easy credit, and with it, the viability of a consumption-led economy, leading to a significant curtailment of economic activity worldwide (pp. 186, 204). Balakrishnan argues that ‘the world’s most advanced societies have been heading to what the classical economists once called the ‘‘stationary state’’ of civilization, a potentially insurmountable condition of stagnation’ that even China’s extraordinary growth cannot forestall (pp. 211, 222).
The deep sense of uncertainty exhibited by many of the volume’s contributors about the long-term effects of the crisis naturally gives rise to contemplation about ‘patterns of new possibility’ – paths toward the reformation or elimination of the capitalist system. In her laudable chapter on Polanyi, Fraser provides a framework for critical theory after the crisis. She argues for a new ‘quasi-Polanyian’ conception of capitalist crisis that embraces a ‘triple movement’ of marketization, social protection and emancipation, enabling theorists to ‘validate struggles against domination wherever its roots’ (p. 144, author’s emphasis). Keyder draws from Polanyi as well, and sees the potential for a double movement that would ‘institute global and national social policies in order to redistribute global income toward the poor’. This redistribution would re-establish a balance between production and consumption and ultimately ‘remedy the imbalances in the global economy’ (p. 160).
Castells also predicts the persistence of a capitalist economy, but imagines a new ‘three-layered’ global structure that includes an enlarged, and tightly regulated, public and semi-public sector that mediates between a small professional class embedded in a ‘revamped informational economy’, and a giant ‘use-value economy’. This use-value economy will be populated by a cultural vanguard searching for meaning beyond capitalism and the ‘disoriented masses of ex-consumers who no longer have the opportunity to consume anything but themselves. . .’ (pp. 205–206).
Harvey and Wallerstein see a world beyond capitalism. Wallerstein predicts a battle between ‘the spirit of Davos’ – the forces promoting a polarized, exploitative system – and ‘the spirit of Porto Alegre’ – the forces promoting an egalitarian, democratic world (p. 85). Like Fraser, Harvey advocates a return to the classics, drawing from Capital and The Grundrisse to advocate the unleashing of a ‘co-revolutionary dynamic that can replace the present system of compounding accumulation of capital’ by challenging capitalist relations at multiple ‘moments’ in the social body politic (pp. 109–111).
In the final essay of the volume, Fernando Coronil presents an analysis of the paradoxes surrounding Latin America’s ‘turn to the left’ in the past two decades. He describes a ‘split world’ between ‘utopian imaginaries’ and ‘recalcitrant histories’. In Latin America, the ‘Left pursues a just future, but its particular content eludes it. It has a sense of direction but no clear destination’ (p. 235). This paradox, I would argue, plagues not just the Latin American Left, but is everywhere felt amongst scholars trying to grapple with the economic crisis.
Business as Usual, charged with the ‘core task of deepening historical understanding of the crisis’, sits uneasily within the same paradox. The volume, as a whole, is successful in providing an understanding of why we got to this point, but the likely ‘destinations’ of global capitalism presented by many of the contributors are less satisfactory. Most of the chapters were penned in 2010 or earlier, when uncertainty was a hopeful word and neoliberalism seemed exhausted. Today, as Harvey argues, the crisis has been moved – pushed onto others (states, workers) while capital has, by many indicators, rebounded. One can counter that this is a temporary fix, that a bigger crisis looms just over the horizon, but the problem of connecting the present to the analyses in the volume in a meaningful way remains.
Coronil’s analysis provides a potential way forward. He argues that Latin America’s ‘turn to the left’ has made it ‘more possible to imagine the present not as a stage toward history’s pre-ordained future but as its necessary ground. . .’ (p. 253). Perhaps then, we should view these analyses not as scholarly tarots, but as a clarion call to re-imagine the present and, in the words of Silver and Arrighi, make it our ‘urgent collective task’ to fight for a better future.