In the fall of 2008, the “shock doctrine” came home to roost in the form of what has been referred to as a financial meltdown in the American but also increasingly larger segments of the world economy. Many were quite surprised, and there was certainly a sense of moral indignation about the entire affair. With media support there has been an ongoing witch hunt for the culprits who “got us into this mess.” But the proliferation of discourses has reacted to this crisis as if it were quite unique. The vacuum with respect to a longer-term comprehension of the scale and dynamics of capital accumulation, the various cycles that are packed into it, from shorter business cycles to longer cycles (including what Giovanni Arrighi and others have referred to as hegemonic cycles), are not part of the immediate reaction to losing one’s savings, pension, house, or livelihood. Consciousness would seem to be a short-term phenomenon, and, in large parts of the Western world, it was for a time reinforced by a myth that somehow business cycles were over and that growth had become a permanent fixture.

Crisis, then, is food for thought and for considering the conditions for action. The issue is that thoughts and actions emerging from crisis often compete with one another. This is why it is important for an anthropology of crisis to state what it is that we are dealing with. Therefore, the following seeks to locate current economic crisis in two larger contexts. The first is the real material process that connects declining hegemony in the global system to credit bubbles and crunches as much as to neoliberal flexibilization. Ultimately, we arrive at a view on crises, where there is a high degree of historical determinism linked to the cyclical logic of capital accumulation as a time-space phenomenon. The second, larger context is one that embeds such crises within an ideological space that becomes increasingly a moral space in periods of desperation like the present. Thus, we are dealing with a powerful material logic on the one hand and an accusatory moralism on the other, one that spans the gamut from hunting the devils to castigating the system itself.

The following discussion thus deals with the articulation between the dynamics of economic value and moral values, distinct and autonomous yet connected in the larger reality of experience and its conditions. What is the nature of the current moral reaction against markets? To what extent is this primarily a crisis phenomenon? And is this, at least, a phenomenon related to the effects of crisis, or are we dealing with a rather general structural expression of the system we live in?

Against keywords
There has been an excessive almost obsessive attempt in the past years to label reality rather than trying to account for its genesis and dynamics. This is a complex phenomenon that requires a study in its own right (Friedman 2000, 2002), but it seems apparent that in the vacuum of debate and the tribalization of academia, a canon has begun to emerge in which category terms, labels, and keywords have become a necessary ingredient in our discourses.

Words such as “globalization,” “millennial capitalism,” and “neoliberalism” are among terms used as causal, possibly definitive, rather than as objects to be deconstructed and deciphered. This has skewed much of the discussion in the direction of labeling and categorizing rather than analyzing. These are also words that have taken on moral connotations, to become part of the ahistorical almost visceral reaction to the rapid transformations of the past decades, as if capitalism was the work of bad guys that calls for a Rambo of the left.

In many ways, the term globalization itself has been, for quite a few years, a way of designating the nature of the contemporary situation, an epoch, a stage in history and unlike anything we have seen previously. In its heyday, globalization discourse made assumptions about a coming world of happy fusions, at least in cultural terms freed “of the constraints of the nation form” (Appadurai 1996: 23). But soon this image was confronted by the contradictory processes that were actually occurring in the world with all of their fragmented violence and class polarization. More recently, globalization has been modified or even replaced by the word “neoliberalism” with a new focus on the “bad side” of globalization.

Of course, words are used to capture a certain aspect of reality, and I would not argue that globalization and neoliberalism do not refer to any real objects, only that they have taken on a kind of magical explanatory value rather than being that which needs to be explained. This enables one to endow them with powers that they do not have. This is because they are not autonomous realities but aspects of larger logics or processes.

Globalization as a historically specific moment within global systemic cycles of expansion and contraction
I suggest that many of the keywords above are misdirected to aspects of a phenomenon that are more products than driving strategies. Globalization is, in this view, not a stage of history but a historical phase of capitalist processes of long-run expansion and contraction. It refers to a period of hegemonic decline in which there is a relatively rapid decentralization of capital accumulation within the larger system and in which potential new centers of world accumulation begin to rise to dominance. This idea is also very close to that expressed in Arrighi’s The Long Twentieth Century (1994), itself a development of Fernand Braudel’s understanding of European economic historical processes (1992a). But it also pertains for a much longer historical trajectory, at least as far back as the earliest commercial civilizations of the Bronze Age (Ekholm Friedman and Friedman 2008). Its internal logic is as follows:

1. Initial expansion by a state within a pre-existing global system or co-extensively with the formation of the latter
2. The formation of a hegemonic economic position, in which a center becomes a “workshop of the world”
3. Accumulation of wealth leads to increasing costs of reproduction in the hegemonic center as the immediate product of this accumulation.
4. Following (3), the center becomes relatively more expensive to reproduce than other regions of the system.
5. This leads to a gradual process of capital export to areas that are more profitable for investment.
   • In this phase capital (accumulated wealth) cannot profitably be invested in local production so it shifts to a combination of export and local investment in luxury consumption and a variety of forms of fictitious accumulation that tend to proliferate exponentially via a chain of packaging, securitization, and sale (i.e., hedge funds).
   • This is equivalent to broadly described shift from industrial to financial dominance in the accumulation process.
6. The center loses its productive activities to other areas of the world and becomes a major consumer (based on credit) of the products of its own exported capital.
7. New centers emerge, commonly former recipients of capital investment from the center, which turns from major source of credit to major global debtor (Braudel’s thesis of the autumn of hegemony [1992b: 246]).

Steps 4 to 7 correspond to the period of “globalization.”

Neoliberalism as a specific historical conjuncture
Just as globalization, neoliberalism can be understood as a cover term for a set of transformations in governance that accompany declining hegemony. There is a logical relation between globalization and the complex of processes referred to as neoliberalism. The transition from Fordism to flexible accumulation, often said to be the turning point toward neoliberalism, is actually the expression of the declining profitability of vertically organized capitalist production, one that was constituted in the period of expansion, which, again, led in classical analyses to modern corporate capitalism sometimes referred to as monopoly capitalism. The Fordist model is one in which the chain of production leading from raw material extraction to the final product tends to be incorporated within inclusive hierarchies of corporate structure. As phases 5 and 6 of the model above kick in, formerly productive units undergo a double process of, first, contraction into an exclusive financial hub surrounded by a slew of competing flexible (replaceable) sub-contractors and, second, a predatory diversification into activities that need not have anything to do with the original productive activity (real estate: hotels, golf courses, casinos; derivative markets, etc., from General Electric to GE Money, from General Motors to General Motors Acceptance Company). Finance is thus freed up from the production process and such periods are, as a result, also periods of massive expansion of finance capital relative to industrial capital. Flexible accumulation here offers a real-world “trickle-down” effect in that it also implies flexible labor, which is likewise hired on short-term uncertain contracts in the wake of the gradual dissolution of labor unions.

The establishment of the conditions of decentralized flexibility requires state intervention, essentially a question of the active dismantling of the former Keynesian controls. Thus, the neoliberalism in this is the change in the political/legal rules—that is, deregulation, or rather re-regulation, of the economic process. Neoliberalism then, in the first instance, refers to the political framework of economic activity rather than the activity itself. The government establishes the conditions of liberalization, privatization of state sectors, and so forth. But this should not be conflated with post-Fordism as an organizational phenomenon, which, in analytical terms, captures the fragmentation of economic activity and the subsequent global networking of the fragments.

One important lesson that can be drawn from this discussion is that globalization, neoliberalism, and related assemblage terms are not, as we have already suggested, indicators of some kind of general development or social evolution. On the contrary, they are crisis phenomena typical of end-of-hegemony scenarios.

Resistance and social movements
Against the background of the properties of a particular process of capital accumulation that is the driving force of the current system, it is noteworthy that most social movements occur in periods of crisis. Crisis implies dislocation of those who are otherwise integrated within the process of accumulation. Resistance is embedded in the system, perhaps in the form of hidden agendas and occasional outbursts, but it is substantially weakened in periods of growth when the integrative processes produce identities that are oriented to a future that seems attainable, often reduced to increasing levels of consumption and self-realization. These in turn are products of a prior individualization of territorial populations, the disintegration of sodalities between the individual and the state. But when crisis occurs, this process stops in its tracks or even backfires, and the embedded contradictions in the system are revived in various old and apparently (only apparently) new forms. This is so because for individual subjects the perspective is limited to the life cycle, and thus the goals of such movements are usually short term. (Even if class conflict was associated with a longer-term consciousness, its praxis was usually oriented to short-term results.) As capitalism has transited into financial or what some call neoliberal capitalism, the dominated population has become increasingly fragmented, not least in terms of cultural identities. The new social movements are primarily about the assertion of demands on behalf of particular culturally identified groups rather than in terms of class. This is no error, but the product of the dismantling of class structures and their replacement by other corporate forms of organization. The proliferation of green, religious, indigenous, and gender-based movements is a clear expression of this fragmentation, which is in its turn very much a product of the state of the system as a whole. The process described above is, in social terms, a race to the identitarian bottom line of social complexity driven by an increasing flexibilization of the work force and the formation of a global lumpenproletariat.

The Kafkaesque world of interpretation, moralization, and Marcel Mauss
The arguments that follow concern the embeddedness of discourses emerging as hegemony reaches its autumn, whether practical, political, or moral within the category sets within which they are conceived and which make them very much products of that which they seek to criticize.

The present economic crisis has led to numerous reactions—a great many of them moralizing. I use the word morals here in the emic sense only. Whether there is an etic morality is itself questionable if hopeful, but as an anthropologist the only morality that can be studied is really-existing morality. And as our practical life is embedded in our material existences, which are themselves constituted within social reproductive processes that are governed by the logic of capitalism, we should expect our moral discourses are generated within the above fields of experience. If one is a “liberal,” then the market is good by definition, and the evil in this situation is the product of deviations from true market morality. It is by cheating and pyramid schemes and tricking people into bad loans or tricking banks into the same that one becomes worthy of condemnation.

Among such moral discourses we find one rather anthropological moralization concerning capitalism, one that opposes it to what was once called the “natural economy” and which is part of a set of schemes based on oppositions of the type:

• primitive/civilized
• pre-capitalist/capitalist
• reciprocity/egoistism
• gift/commodity
• gemeinschaft/gesellschaft

Reference is made to the work of Mauss and Polanyi, to an economic world in which the economic is itself embedded in social relations. This is, of course, something of an exaggeration insofar as the market economy is itself a socially constructed and politically instituted reality. The more recent critique is that this dichotomization is itself ideological and a misrepresentation of the de facto mixed nature of all “economies” (Carrier 1992). This might well be a case of “occidentalism,” the essentialization of the West even if such dichotomies are always revealing of important issues. Karl Polanyi’s The Great Transformation (1944) is the classic and one of the most sophisticated examples of this oppositional discourse, and it contains within it the proof that that what appears as an external contradiction is also internal to capitalism. This is what he refers to as the “double movement” of the capitalist market, the liberal excesses of accumulation that lead to crises, and the need for state regulation to keep the former within the limits necessary for the survival of the population. The regulatory tendency is itself a skewed manifestation of the principle of solidarity, expressed in the gift relation in non-market worlds, and in it lies hidden the secret of social democratic ideology in which the function of the state is to insure the social welfare of the population (defined as the working class, although this is not an accurate description) by redistributing some of the proceeds of capitalist accumulation.

Morality within and beyond the system: Concluding distinctions
The above suggests that the discussions of the social consequences of capitalism are as old as the subject itself. Much of the discourse is produced from the alternative position and includes an array of more or less radical critiques, which, we have argued, generated from within the categories of the capitalist order. However, there is a more pedestrian stance, which is limited to the morality of particular capitalist actors, one that unties the “liberal,” the Maussian anthropologist, and the social democratic types of morality I referred to above. It assumes that there are legitimate morally acceptable practices and those that are beyond the threshold of immorality. It is even suggested by some that if capitalists were moral there would be no crises. Such an internal critique, a kind of hypocritical navel-gazing of the system in periods of hegemonic decline, posits a set of behavioral rules that are adapted to what is assumed to be a well-functioning economy.

But all of this talk about immoral capitalists assumes, of course, that there is a moral capitalism. In the liberal scheme of things, in which there are only price-based transactions, there is no fundamental (and surely no moral) difference between speculation as a general category and what we might call the necessary or rather material processes of social reproduction with all the prices and transactions involved. Thus, what Marx called fictitious capital in volume three of Capital—whose accumulation is the final process in the cycle of investment, growth, and decline—is also the principal operator of accumulation. It is not the growth of production or services, not the turning of cars into more cars, but the turning of money into more money. The way it occurs is, in fact, secondary, that which permits the expansion of speculative and other forms of fictitious accumulation in periods of decline. Since morality is grounded in a vocabulary of values, it is important to insist that the discussions of economic value should not become confounded with moral values that are in themselves a suspect turn, in phrases such as “moral economies,” and in the search for new keywords.

The argument that runs through this discussion is that moral representations are based in the same categories that constitute the social order more generally. This accounts for the similarity of so-called “external” moral critiques and internal critiques. This is the Kafkaesque nature of representation, interpretation, and practice with respect to “the economy” that makes it the proper domain of anthropological analysis, which is facing a situation in which intentionality is not its own source in terms of content. In crises like the present it becomes even clearer to what extent our reflections on reality are not autonomous even if we feel it in such terms. It is rather, as Lewis Caroll put it, “when you don’t know where you’re going, every road takes you there” (Alice in Wonderland). And this returns us to the issue of fetishism—that is, when the categories of critique are derivative of the categories of the system that is to be critiqued, and even overturned, we are in serious trouble.

Jonathan Friedman is Distinguished Professor of Anthropology at the University of California, San Diego and Directeur d’études at the School for Advanced Studies in the Social Sciences, Paris. His research has dealt with structuralist and Marxist analyses of kinship based societies and social transformation and with the anthropology of global systems.

Cite as: Friedman, Jonathan. 2014. “Did someone say globalization? The mystification of intellectuals and the cunning of history,” FocaalBlog, July 17, www.focaalblog.com/2014/07/17/did-someone-say-globalization-the-mystification-of-intellectuals-and-the-cunning-of-history-by-jonathan-friedman.