Strange Realities

I finished teaching Marx in class today. We had started out with his philosophy where I traced Marx’s intellectual development (in the context of Hegel and Feuerbach) and the historical materialist method that he developed (I offered a schematic and a narrative based on a Deleuzian flat ontology made possible by Heidegger’s notion of mode). We then made a detour into Althusser (to elaborate on the State and ideology) and, taking material from my thesis, finally discussed Marx’s critique of political economy (the forms of activity, material, and value in the capitalist political economy; labor and capital at the level of forces, classes, personifications, and persons; profit in exchange from the exploitation of labor; the need to realize surplus, crises of overproduction, and the changing form of capitalism). I ended the class with a brief and intentionally vague sketch of “species-being” and what Marx describes as the “free development of the human individual” in “communist society.”

There is a recent incident that illustrates what Marx critiques about the political economy that, unfortunately, I wasn’t able to raise in class (so I do it here). In late 2008, in lieu of the current economic crisis, former US Federal Reserve chair Alan Greenspan was called to testify in Congress. He had a revealing exchange with California congressman Henry Waxman:

Towards the end of his interrogation, Waxman asks Greenspan, “Do you feel that your ideology pushed you to make decisions that you wished you had not made?” Greenspan circles around the question, proffering his own definition of “ideology.” Greenspan who, consistently in the past, has uttered the term only with bitter contempt, identifying it with those who (like Naomi Klein)—unlike Greenspan and his experience (40 years in the Fed)—were somehow misinformed or misguided, perhaps even, for some tendentious reason, willfully misrepresenting reality. Those who—unlike Greenspan and the objective “science” he was a part of (along with University of Chicago guru Milton Friedman)—were delusionary, if not downright power-crazed totalitarian Commie. All the while as he enacted neoliberal policies (that monstrous combination of classical and Keynesian economics: deregulation, privatization, welfare cuts from the poor, wealth redistribution to the rich . . .) not only at home but abroad in a truly global economy.

In the debate with Naomi Klein (in late 2007), Greenspan retorts: “First of all, ideology is not what I hold. I try to learn what are the facts, and I let my opinions, judged on the facts, not by some preconception, which I regret is what ideology as a notion means.” In contrast, in front of Waxman: “Ideology is a conceptual framework with the way people deal with reality. Everyone has one. You have to. To exist, you need an ideology.”

Waxman is not distracted by the evasions. When Greenspan says, “I found a flaw—” Waxman interrupts in disbelief, “A flaw in the reality . . .?” Greenspan responds with complex formulations. Mindful of the time, Waxman finally demands, “In other words, you found that [. . .] your ideology was . . . not right?” “I was shocked,” says Greenspan, and (finally!): “Precisely.” Yes, I was in ideology.

That is classic! The head of the financial system—dismissive of “ideology” (except for his)—faced with a crisis he is responsible for is forced to recount in public that, as he defined the financial landscape of the world of the past 40 years, he did it with—in—ideology . . . The man possessed of oh so much certainty, hubris, authority, and power, the chief captain of the “free market” who has always posed his stance as “natural,” objective, a “science”—now forced to admit that his view of the world was (like the rest of us) but an ideology. That has got to be one of the most dramatic moments in recent American history—and no one even had to write it!

Greenspan of course could only do all this afterwards, with some reflection, after he had stepped down from power—and when forced (by a crisis!). As Althusser says of ideology:

Those who are in ideology believe themselves by definition outside ideology: one of the effects of ideology is the practical denegation of the ideological character of ideology by ideology: ideology never says, ‘I am ideological.’ It is necessary to be outside ideology, i.e. in scientific knowledge, to be able to say: I am in ideology (a quite exceptional case) or (the general case): I was in ideology. As is well known, the accusation of being in ideology only applies to others, never to oneself.

Greenspan could never say, “I am in ideology,” (science itself, I believe, is ideological, and economics, moreover, is not a science!) because then, being inside, he would not see it. (When he says, “I was in ideology,” well, what good does that do?) What makes these free-marketeers even more exceptional (in their being ideological) is that they are particularly self-assured and forceful in insisting that No, they are not in ideology (They are just letting be, laissez-faire!)—and their words (like scientists) carry weight, not to mention that they are (frequently) in positions of power. It is of course not only their discourse that appears as natural, but the capitalist political economy itself of which their discourse is the official science, organized as it is according to neoliberal principles. (Hence the distinct character and potency of Marx’s critique.)

But at least Greenspan was forced to admit. At least (if we can believe him) now Greenspan knows and, more importantly, we (should) know—Which is less than we can say for Ben Bernanke, Greenspan protégé, the new Fed chairman; Henry Paulson, former investment banker, Treasury secretary to the end of the previous administration; Tim Geithner, new Treasury chief, another New York insider; Robert Rubin and Larry Summers, “Liberal” deregulators, Obama’s ear on their mouths. These people never did recant. They never were forced to swallow in public. And they continue to shape the financial and economic policy of this country.

But they did change ways. They did defy their so-called “principles.” Confronted by a meltdown (of their own doing!), free-marketeers (even if only secretly) must have swallowed—swallowed hard—enacting all those interventions in the economy.

The only thing is, their intervention only helped their former colleagues. They are in fact intervening in the economy—to help their own class!

And they are still in charge! And everyone’s shouting, “We have become Marxists!”

The world has become a circus—and the clowns are ruling, if not laughing. What to say, what to say? It is a crazy world we live in!

Addendum (Some background on the economic terms):

Responding to the laissez-faire tendencies of Smith and Ricardo’s classical economics (that argued that the economy is composed of free, equal, and rational individuals in a self-regulating market), Keynesian or Liberal economics was developed by John Maynard Keynes during the Great Depression to argue that, over and above the ‘free individuals’ of the classical model, the State has a role to play in the economy in speeding up the process by which it reaches equilibrium, its optimum level of activity (hence its interventionist implications). Neoclassical economics, in turn, was a response to Keynesian economics in the crises of the seventies and eighties when presidents like Ronald Reagan and Margaret Thatcher enacted policies that called for low taxes, ‘balanced’ budgets, the reversal of New Deal welfare policies, and the removal of government constraints on private business in general. The neo- in neoclassical signals that the new economics is no mere return to the past but is an advance. True enough, there was in neoclassical economics tacit acceptance that the State would (and should) intervene—if only to make sure it wouldn’t (and that businesses are duly represented). Neoliberal economics is, in many ways, the consummation of the neoclassical model as ‘liberal’ governments of the West (especially the United States) sought to transform developing economies (through institutions like the World Bank and the International Monetary Fund) according to its own model (systematized by the Chicago School of economists, foremost of which was Milton Freedman). In essentially enforcing policies of deregulation and privatization around the world, neoliberal economics is thus a monstrous combination of classical and Keynesian economics in that a ‘liberal’ State intervenes to enforce classical, orthodox economic principles around the world: a new liberalism, indeed. Despite the seeming variety, then, among the supposedly different strands, economics maintains the core assumption of equilibrium.