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DON KALB Central European University and Utrecht University Financialization and the capitalist moment: Marx versus

DON KALB Central European University and Utrecht University

Financialization and the capitalist moment:

Marx versus Weber in the anthropology of global systems

ABSTRACT

Kajsa Ekholm Friedman and Jonathan Friedman’s The Anthropology of Global Systems (AGS) is a robust, ambitious, and timely undertaking in macrotheoretical and macrohistorical anthropology. I show that, more than 30 years ago, its political-economic underpinnings anticipated the key mechanisms of financialization, so important for debates on the current financial crisis. By revisiting the “transition from feudalism to capitalism” debate with new insights from diplomatic history, I work out a Marxian critique of the Friedmans’ Weberian concept of capital, which is insufficiently relational and therefore not sufficiently alert to the politics of class. Attention to these relational politics adds an important measure of what I call “structured contingency,” and indeed agency, to temporal process, which in the AGS tends to become overly teleological. Building on my critique, I also draw attention to the absence of the possibility of “collective rationality” in the Friedmans’ grid of modern subject positions. [globalization, financialization, Marx, Weber, capitalism, transition to capitalism, class, modernism and modernity ]

nvited to comment on the Wall Street collapse while it was ongo- I ing, Keith Hart and Horacio Ortiz (2008) made several points worth recalling: First, anthropology’s relevance would be much enhanced if some of us adopted a more self-conscious strategy of analyzing the crisis of society at all levels; second, if we want to do so effec-

tively, we need to rethink our methods in terms of the relationship between ethnography, history, and philosophy; and, third, attention to the work of Karl Polanyi and Marcel Mauss, with its stress on the embeddedness of markets and money in social relations and institutions against dominant neoliberal “economism,” is one commendable way to start such a project (see also Gudeman 2008). “Embeddedness theory” delivers a critique of the economic paradigms involved in the current capitalist crisis on the basis of their cognitive distortions or their moral and ethical failings. But Polanyi and Mauss do not point to an explanation for the recent and continuing dominance of these paradigms beyond the straightforward functionalist notion that they have probably served the dominators well. Nor are they always eloquent about why markets appear to be disembedded. Mauss and Polanyi derived their vision from the Christian socialism of small-scale producer associations in early modern European cities. The Friedmans’ The Anthropology of Global Systems ( AGS; Ekholm Fried- man and Friedman 2008a, 2008b) builds its political-economy compo- nent on a later and very different version of European socialism, as rep- resented by Rosa Luxemburg. Their work adds important elements to the “embeddedness” perspective by focusing on the cyclical globaliza-

tion of capital, capital flight as a response to the loss of market com- petitiveness, and the recurrent geographic shifts in the centers of accu- mulation throughout human history that underlay such globalizations. What this results in is a more systematic view of geographic space, structural obstacles to capital accumulation and flows, and in a con- ception of time and periodicity that springs from an analysis of cap- ital and empire rather than “just” markets and communities—though not sufficiently, as I argue here. This framework actually helps us to explain why, lately, neoliberalism has served the dominant so well.

AMERICAN ETHNOLOGIST, Vol. 40, No. 2, pp. 258–266, ISSN 0094-0496, online ISSN 1548-1425. C 2013 by the American Anthropological Association. All rights reserved. DOI: 10.1111/amet.12018

Financialization and the capitalist moment American Ethnologist

Obviously, by advancing theoretical work and by combin- ing contemporary historical ethnography in several world regions with archaeological research on antique world sys- tems, the Friedmans’ approach magnificently embodies the reconceptualization of the anthropologists’ mix of methods that Hart and Ortiz urge us to consider. Here is a quote that serves as an example of the sort of insights that this shift from “markets” to “capital” helps to make. It gives a representative flavor of some of the more di- rectly political economy–oriented claims that are advanced in the AGS —which are, of course, only a small part of what that work is about, but a crucial part in any case. I am giving a long quote, focused on the West, to show how much some anthropologists not mentioned by Hart and Ortiz have ac- tually already been engaged in analyzing the structures be- hind the financial collapse:

This (recent) cycle was one that ran from high national accumulation and a high proportion of world pro- duction and export of manufactures associated with relatively limited internal consumption to a low rate of accumulation and a high rate of capital export. It was in the latter phase that internal consumption was highest, but it was followed by a weakening national economy, a decline in real wealth, and a shift in the center of accumulation, the degree of competition, in- ternal high consumption, fictitious accumulation, and

multinationalization

.much of the present structural

crisis in the world economy is clearly related to this development—that is, the tendency of the center to be-

come a consumer of the products of its own exported capital, while producing less itself, leading to a chronic

The export of capi-

balance of payments problem

tal reflects a shift in the central stakes from industrial

As capital is exported, it

to financial accumulation

shifts increasingly into speculative and fictitious accu- mulation at home, the latter is a normal cyclical phe-

nomenon that may in fact be offset by massive capital export if the latter brings back enough money capital in order to maintain credit levels in an increasingly un- productive national economy. [Ekholm Friedman and Friedman 2008a:54]

In particular, the last two sentences closely capture some of the crucial underlying financial processes that have been happening lately. The Friedmans argue that similar se- quences and spatial dislocations with comparable capitalist mechanisms have been in evidence since the early empires, and AGS features some wonderful chapters elaborating this.

Now, here comes the surprise: You might think the above passage is about the present crisis unfolding since 2007. Wrong. The analysis was first published in 1978 (in Immanuel Wallerstein’s Review; see Friedman 1978), a full generation ago. The surprise is, as usual, a meaningful one:

Minimally, two relevant things can be read from it.

The first is that some fifteen years before Giovanni Arrighi (1994) discovered the core mechanism of “financial- ization,” the Friedmans were already sketching its contours quite specifically. Financialization is what Fernand Braudel called a moment of “autumn” in an accumulation cycle in the world system. After a period of advances in techniques, new products, and rising productivity associated with the emergence of a new hegemon in the system, innovations are copied by others in the system, wages rise, overall com- petition starts to increase, profitability declines, and capi- tal accumulated in the once-expanding core is disinvested, turned into liquidity, taken out, and used as credit for spec- ulative purposes at home and abroad in a frantic effort by the core to regain its profitability. The background for the financial collapse is the pro- cess of financialization as described by the Friedmans and, later, by Arrighi. Recent commentators have emphasized the insatiable and indiscriminate demand by investors for whatever financial innovation was on offer. In their presen- tist perspective, such authors seem to take the enormous lake of liquidity that massively pushes for valorization as self-evident. But it is not, and it is precisely what must be explained in the first place. Financialization, as a slowly creeping as well as institutionally and spatially revolution- ary process over time, is the underlying cause. With AGS in hand, anthropology can claim some early and powerful insights here. Clearly, the turn toward history and theory has been a key tool for making such discoveries. AGS also shows that there is nothing new to historization and theo- rization in the discipline, not even during the short post- modern interlude—which, significantly, fell right within the financialist moment, in what Arrighi called the new “belle epoque,”´ and which was in fact intellectually mimicking the speculation and infinite flow defining this conjuncture, as the Friedmans have regularly pointed out. The AGS is a rationalist and realist monument against the postmod- ern seduction of endlessly circulating signifiers feverishly in search of meaning. The second insight starts from the surprising observa- tion that it obviously took 30 years for the Friedmans’ antic- ipated financialization moment to come to full fruition at home. The Friedmans were analyzing empirical processes in the 1970s, but in retrospect we know they were in fact giving a prediction for things to come after a whole genera- tion. This speaks both to the strength and to the weakness of their analysis. The strength lies in their analysis of the basic cyclical tendencies of capital export and deconcentration, the weakness in their lack of anticipation of the specificities and contingencies (in fact, the “structured contingencies”) that postponed the full consequences of these trends for a whole generation. Both strength and weakness, I would argue, spring from their notion of capital and capitalism. The Friedmans are strong on understanding the transhistorical inclinations of

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money capital in general (“commercial capitalism,” they call it) but focus less sharply on the more specific mech- anisms and politics of capital ism, which, I argue, cannot be reduced to money capital or commerce. The reason for their emphasis might relate back again to their specific version of Hart and Ortiz’s “new methodological mix.” As all-round anthropologists, the Friedmans turned to field- work in several global peripheries as well as to archaeol- ogy in the antique cores of the circum-Mediterranean. They spent less time studying modern European history, which is, of course, precisely what anthropology was classically not supposed to be about. Even exemplary omnivorous and iconoclastic researchers like the Friedmans cannot eat or slay everything. But provincializing Europe is one thing; not sufficiently theorizing it is quite another. This must be an- other recommendation for Hart and Ortiz’s methodological wishlist: reject the “savage slot.” First, in the above quote, the Friedmans hint at a mech- anism that could have served to postpone the process of deflation getting under way until the seventies. They argue that if exported capital brings back “enough money capi- tal” to reinflate the economies of the core with easy credit, the process could be extended over a longer time span, de- spite declining local productivity. This has turned out to be an excellent prediction. But unspecified in the 1978 Review article are the precise conditions under which those large quantities of money capital return to the core over a pro-

tracted period. This is where capital ism comes in, which is,

I emphasize, not just wealth or commerce but, first of all,

a social, institutional, and geographic power relation that

can produce, sustain, valorize, and secure wealth over time by deepening and extending capitalist (imperial) relation- ships “endlessly,” as we know. In other words, capital ism is not just about finance but is defined by the capitalist nature of formations of state and empire. It is about power. The Friedmans (2008b:7) define capital in the Webe- rian sense of “abstract wealth.” At various places in AGS (but, in particular, in Historical Transformations, chapter 1), they argue against the Marxist notion of capital as a social

relation of exploitation between capital and labor, which they see as necessarily place based rather than spatial and static rather than dynamic. Marx, they argue, was too im- pressed by the industrialization and urbanization processes and their localizing consequences happening around him in 19th-century Europe. Later Marxists, in a different conjuncture, such as Luxemburg (2003), V. I. Lenin (1996), and Rudolf Hilferding (1985), articulated a more expansive and spatial understanding of capital, focused on the global circuits involved in the crisis-ridden social reproduction of societies rather than place-based social production within factories and localities. The Friedmans’ critique of Marx is not unfounded, although David Harvey (2006), for example, building on Henri Lefebvre, found a way around it in his dy- namic notion of the “production of space” and the “spatial

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fix.” World-systems theory too never bothered much about the supposedly localized Marx. It took his insight in uneven exchange and spatialized it through the notion of “world system.” The point is, as Luxemburg (1996), world systems theory, and Harvey (2006) show, that this relevant critique of the place fetishism of 19th-century Marxism does not nec- essarily lead to embracing the entirely nonrelational Webe- rian notion of capital as abstract wealth. It can also encour- age one to seek a more spatialized relational notion of cap- ital. This is a path not taken by the Friedmans. Given their reliance on Luxemburg in other respects, one wonders why. Throughout AGS, the Friedmans talk about “com- mercial civilizations,” time and again emphasizing that modern capitalism is no more than a subspecies of this very broad historical category. If we want to understand why capital could actively create, indeed impose, the conditions under which it would bring “enough money capital back” into the core between 1977 and 2007, we need to bring back capitalism ’s specificity again. I do that via a detour through the historical core of the core and by revisiting the “transition debate” with new historical insights from diplomatic history.

“Anglo-Dutch moments” in the transition(s) to and within capitalism

The term commercial civilization conjures up the image of the mercantile city and the city-state. The question of whether the classical empires, in particular Rome, belong to this category is open, since so much of their internal dy- namics depended on war, plunder, bounty, and rents from vassalage rather than “mere” trade. While the Friedmans do write about imperialism in several chapters, it seems that the city-state and its wider territorial hegemony through the spatial division of labor is much more emblematic of their theoretical vision. In Wallerstein’s terms, they talk about world systems and not so much about world empires. Nei- ther do they talk about capitalist world systems or capitalist imperialisms. Arguably, the transition from Weberian capital as ab- stract pecuniary urban wealth to full-fledged capitalism ac- cords with the shift from the last world-dominant city-state formation in history, the United Provinces—a protonational alliance among trading cities at the muddy margins of Eura- sia, with Amsterdam, by the late 16th century, as its over- powering player—to the United Kingdom. This shift in the center of capital accumulation is also a qualitative shift in the mechanisms of accumulation: I argue—with an eye on the classic debate on capitalist transition—that it is, in fact, the moment of the making of capitalism, the mo- ment at which mercantile capital fully merges with territo- rial state power and becomes, in fact, world making. From that point on, capitalism subjects territories and their so- cial structures, including, crucially, the prevailing forms of

Financialization and the capitalist moment American Ethnologist

the state, directly to its own accumulation imperatives. This transition shows exactly what the difference is between ab- stract wealth and capitalism as a social, institutional, and geographic power relation. I discuss it below as an illustra- tion of what goes missing if you build a theory of capitalism

or finance on Weber. 1

The precise dynamics underpinning this momentous historical shift have not always been well understood. For the classic authors in the debate about the transition from feudalism to capitalism, the shift has always remained a

bit of a black box: At some point around 1700, the United Kingdom, it is assumed, somehow surpassed the United Provinces in commercial prowess, explained in general by

its larger resources. Both Wallerstein (1980) and Arrighi (1994) have little more specific to say about it. For Robert Brenner (1987, 1993), it is not even very significant because, for him, UK capitalism emerges as an internal phenomenon

in its own countryside, driven by agrarian class formation,

the enclosure movement, and the creation of a landless

proletariat. For Brenner, “capitalism in one country” seems

a perfect possibility (another Marxist place fetishism).

Whig historians have also always been vague, noting the

emergence of a “political union” in 1688, when the Dutch stadholder William III became king of England, supposedly “invited” by the Whig party and the Protestant gentry (Ferguson 2004; Pincus 2009; see also Brenner 1993). This

is, indeed, what Thomas Macaulay’s classical 19th-century

text History of England narrates. But “political union” is

a highly unanalytic term suggesting some kind of rosy

get-together. That sort of “union” does not exist in history, certainly not when a concentrated container of capital and maritime firepower such as the United Provinces, itself utterly disinterested in territory, is one of the desig- nated partners. This city-state alliance had very specific interests for making a “union,” and these interests were infinitely better served if the outcome were to be forever

represented as a union on English request. What were these

interests?

Recent research suggests that the story about the “in- vitation” is, in fact, one of the myths of the modern world that has continued to anchor the grand narrative of the En- glish state and its “glorious revolution” until the present day.

The myth depicts the glorious revolution of 1688 as a na- tional uprising of an independent Protestant people against a Catholic tyrant, James II, helped by the Dutch stadholder. Research in Dutch archives by Jonathan Israel (2003), how- ever, has established that the “glorious revolution” was in reality a full-fledged Dutch military occupation decided in Amsterdam. Admittedly, there was substantial internal En- glish support for it, but it was largely driven by a delib- erate Dutch-led propaganda campaign for the “protection

of English liberties.” More than an internal rebellion, 1688

was what Israel called “the Anglo-Dutch moment”: an in- vasion by one of the largest war fleets that early modern

Europe had ever seen, financed and ordered by the City of Amsterdam. The burghers of Amsterdam did so with a strategic design in mind that was as audacious as it was desperate. Threatened by the rising clout of France and its world-empire designs, and looking a decisive land-based military battle in the eye, the leading burghers intended to externalize their staggering protection costs with one sur- prise seaborne move and quickly turn around the balance of forces in Europe by forcing a military alliance with an England that would now be commanded by the Dutch mili- tary elite. With full control over the center of London (and the channel), James II running, and an important gentry segment in the provinces willing to collaborate on Dutch terms, William made England responsible, militarily and also financially, for defending the Low Countries, while his own battle-hardened mercenaries were to unify the English Isles against the counterrevolution led by James II with sup- port of France. A “perpetual Protestant alliance” was forged between the United Provinces and what was now “Great Britain.” The final crown on the Dutch design was not the crown of James II but the creation of the Bank of England in 1693 and the consequent creation of the capitalist state–finance nexus supported through public debt. The bank, mod- eled on Dutch financial practices and heavily underwritten by (Anglo-)Dutch financiers, guaranteed Amsterdam-based capital higher fixed rents in English state bonds than even the Dutch East India Company could deliver. It also made the English state accountable for guaranteeing the value of these investments, which were now backed by state revenue based on the highest tax rates within Europe (except for the United Provinces itself ). This move was explicitly linked to the strengthening of a parliamentary regime that would prevent the monarch from defaulting or inflating away the debts of the Bank of England on his own account. Thus was created the first credible alliance between territorial state making, empire building, and capital accumulation since the Roman Republic. The bank and its wider constitutional, legal, and institutional environment was, in fact, a histori- cally unique accumulation mechanism designed by Dutch capital for global capital formation. It would work in tan- dem with the English state, which would now have the fi- nancing mechanisms in place for outcompeting France on the North Atlantic and imposing capitalist relationships all over the globe. The bank facilitated the recycling of Dutch capital into the making of the Atlantic space of flows, creat- ing a spatial division of labor among a “commonwealth” of juridically “free” communities connected through the cir- cuits of capital with London as its center and entrepot.ˆ Af- ter the “glorious revolution,” the enclosure movement in the English countryside, so essential for the Brenner thesis, was accelerated and legally consolidated, and the internal capitalist transition within England became now both hege- monic and nonreversible. 2

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In other words, the making of the modern British state and the Bank of England, including its further internal and external ramifications of capitalism at home and capitalist imperialism abroad, was, in fact, the outcome of an inter- vention by Amsterdam-based finance capital to first save itself and then create a larger and secured space for its own operation. Until late in the 18th century, the “finan- cial revolution” (Brewer 1988) that drove English imperial- ism forward was substantially financed from Amsterdam. Over this period of a hundred years, the English state debt multiplied more than ten times, but its revenues boomed even more. The Anglo-Dutch moment therefore signaled the world-historical transition from the precapitalist long phase of city-state formation in the interstices of territo- rial empires—the period of capital as “abstract wealth”— to actual modern capitalism as a social, spatial, and insti- tutionalized relationship, crystallized around formations of state and empire, that could now be imposed on territories and communities whose reproduction would subsequently become not just dependent on it but structured by it. The core of that relationship was composed of three elements:

the creation of dependent labor forces (free, bonded, or enslaved), secured “free” and “endless” capital circulation, and supremely militarized imperial state power focused on enforcing contracts, property rights, debt obligations, and the management of unequal exchange (“the rule of law”). Capital had become a space-making, indeed world-making, and biopolitical force far beyond mere wealth. While capital leaked away from the United Provinces, local credit in Amsterdam became more abundant than ever. Pockets of rentier wealth kept accumulating. But, over time, unemployment, urban poverty, and the stagnation of provincial middle classes became political issues, as did protest. Inequality and oligopolization deepened all through the period up to 1800 (Israel 1995). I now move the focus back to the contemporary West, where similar, though accelerated, processes began to occur in the 1970s. In response to overaccumulation and a declining rate of profit, Western capital was disinvested and turned liquid. Abstract wealth flowed out, first to the Global South and later, increasingly, to the Global East, where much larger, more disciplined, and better-educated proletariats were to be found as well as to be made. Western capitalism meanwhile created for itself the global social relationships, institutions, and mechanisms—analogous to the Bank of England + English imperialism + enclosures formula of the 17th and 18th centuries—for deepening the global divisions of labor, guaranteeing “free trade,” and securing the value of its overseas investments, including the safe repatriation of “enough money capital” to create Arrighi’s belle epoque´ of postmodern consumption. Among the analogous mechanisms were the Washington Consensus, neoliberalism and its abbreviated version of democracy and human rights, the WTO, the post–Bretton Woods roles

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for the IMF and the World Bank as the toolbox for national institutional reengineering and debt collection, the global property rights regime, the new “humanist” militarism, the depression of local social wages by developmentalist states and competition states seeking to attract global capital (Kalb 2005). These mechanisms also had consequences analogous to those of the Anglo-Dutch moment: the de- velopment of new spaces of capital, global imbalances, oligopolization in the old core, growing inequality, and, finally, crisis. Nothing new, the Friedmans would say. But the specifics are new, and the important point is that they are not anticipated by Weber’s “abstract wealth.” Abstract wealth does not make new spaces of capital. Abstract wealth is not by itself world-making. Only capitalism is.

Global–local: Alliances or hierarchies?

The function of this digression into history and concepts is not to argue the innate superiority of Marx over Weber or anything else of a scholastic nature. The function is, first, to illustrate the sort of global capital ist processes that were overlooked in Friedman’s otherwise foresighted 1978 arti- cle and that are insufficiently developed in the AGS, with its idea of capital derived from Weber. Second, I need this il- lustration to discuss the vision of the global, the local, and their mutual articulations in AGS . The global, the Friedmans argue repeatedly, is not something tangible out there, not something hovering above the local. It is not a “supralocal organism” (Ekholm Friedman and Friedman 2008b:9), not an independent sphere of activities and interests forcing itself on local life (2008b:1–11). In particular, it is not “transnational” (Ekholm Friedman and Friedman 2008b:9). For the Friedmans, it is the sum of the properties of a global system of exchange relationships and divisions of labor: “The global is in em- pirical terms the arena of interaction among localities” (Ekholm Friedman and Friedman 2008b:4). Their vision is certainly consistent with a Weberian no- tion of capital and exchange. But it ignores the possibility of capital ism as an institutionalized large-scale system of un- equal exchange, guaranteed and imposed by statelike and imperial institutions that push people over time in different ways and via different social forms into the networks of cap- ital or that even produce literally capitalist spaces. Their vi- sion of the global is at most Holland before 1688 but not the English empire or the U.S.-led neoliberal, militarized, and financialized “globalization” of the last three decades. Such capitalist global systems have an identifiable set of very tan- gible “transnational” institutions and networks in place that penetrate deeply into the structure and dynamics of local- ities and, indeed, tend to re-create localities in their own image. Ergo: It does hover above the local in at least some significant ways. Jonathan Friedman has regularly rejected the premises of the cultural globalization school in anthropology for

Financialization and the capitalist moment American Ethnologist

assuming that globalization was something new and had generally transformative consequences on local culture everywhere. AGS magisterially demonstrates that local societies have always been dependent for their social reproduction through time on exchange relationships with others within global systems. At the same time, it claims, against the cultural globalizers, that such local cultures, through time, have remained distinct, have kept forms of “sociality” and “intentionality” of their own, and tend to “assimilate” circulating items according to their own “strategies” in order to “practice coherence” (Ekholm Friedman and Friedman 2008b:11–24). AGS strongly argues against a diffusionist anthropology focused on circulating signifiers. U.S. anthropology, it reminds us, had always rejected diffusionism in favor of an interest in how cultural elements were “structured into larger schemes of life” (Ekholm Friedman and Friedman 2008b:13). AGS defends Franz Boas against the return of the Kulturkreislehre, and it does so on Boas’s culturally holist grounds. This view connects with a general property of local– global articulations in global systems a` la the Friedmans. In AGS, while localities will always depend on wider spheres of exchange for their social reproduction, they are explicitly not shaped or determined by them. Their actual social log- ics and forms of development are ultimately local. Global systems in this vision are always “constraining” (Ekholm Friedman and Friedman 2008b:2) for local possibilities— and evidently also enabling—but never more than that. They remain external to “local strategies,” “socialities,” “intentionalities,” and “practices.” Global systems thus “set limits” but never really “exert pressures” of a radically qualitative kind. The work the Friedmans use to illustrate this local–global articulation is that of Claude Levi-Strauss´ on alliances. But why not turn to Eric Wolf, for example, whose work (1982, in particular) could be said to be funda- mentally about such relationships? Alliances have a taint of horizontalism about them. They are not automatically as- sociated with profound hierarchy, inequality, unevenness. Friedmanian notions such as “commerce,” “exchange,” and “alliances” do not well describe capitalist imperialism, exploitation, structural violence, and the dispossession that also tend to come, cyclically, with capitalism. It is tempting to say that this conception of local–global articulation fits the Friedmans’ ethnographic cases well. Their cases are not located in the spaces made directly by capital. They are not, say, Gerald Sider’s (1986) New- foundland fishing communities, which were historically hidebound vis- a-vis` English merchant capital and therefore deeply contradictory rather than coherent, instances of people forced inevitably to “struggle within and against their own histories.” They are not Susanna Narotzky and Gavin Smith’s (2006) Vega Baja in Spain, where class rebel- lion and civil war, fascism, and the European Union have created continuous havoc and taken away any chances

of local coherence and cultural autonomy; where “local culture” is actually explicitly used against the people who live there. They are deeply unlike my own Dutch and east European 20th-century urban industrial locations where local histories are both selectively appropriated on behalf of capital against local daughters and presented as barbarism that must be unlearned by shock therapy and dispossession (Kalb 1997, 2009). I cite these particular cases because they deal with the local ramifications and contradictions of capital and have led to a reimagining within anthropology of class in relational, spatialized, dynamic, and situated ways. One could make a case that the Friedmans’ culturalist local–global reimagining sprang from their debate with the cultural globalist school on the latter’s diffusionist terms. But I would argue that the difference with the class approaches is not random. It is a difference that stems from the contrast between a Marxist and a Weberian conception of capital and class. There is a set of pressing theoretical debates involved here that go far beyond the descriptive question of local cultural difference: They are about the mechanisms of insertion and subjection of locales and peoples in capitalist power projects as well as about their cultural intentionalities. And they lead, for example, to rethinking Boasian ideas such as “cultural coherence” in the light of lived contradictions. Class was always meant as a notion pinpointing the mechanisms of unequal exchange as well as describing the unequal “cultural” negotiations by which they are surrounded. And I do not just mean class from below but, in particular, also class from above, the class-structured relational articulation over time, including the recurrent “Anglo-Dutch moments.”

Hegemony and identity: Logic of capital or structured contingencies of class?

With their tools based on ethnography, archaeology, Lux- emburg, Weber, Levi-Strauss,´ and Boas, the Friedmans have generated a sparkling oeuvre, peppered with debates with eloquent adversaries such as Marvin Harris, Mar- shall Sahlins, and, recently, the cultural globalists. The excitement of AGS lies in how the Friedmans bring to- gether three different specialist interests: in the expansion and contraction of global systems throughout human his- tory, the formation and demise of centers and peripheries through time, and within those processes the “cyclical and dialectical relations between cultural identity and global hegemony” (Ekholm Friedman and Friedman 2008b:11). Their work thus stands out as probably the most ambi- tious effort at large-scale theory formation in anthropology today. In AGS, these three strands come synthetically to- gether in the theory of modernity as the cultural and iden- tity space of all “commercial capitalisms” in human his- tory. This is succinctly represented in three complementary

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American Ethnologist Volume 40 Number 2 May 2013 Figure 1. The ramifications of hegemonic decline in

Figure 1. The ramifications of hegemonic decline in the Friedmans’ glob- alization framework. Figure courtesy of Jonathan Friedman.

graphs in AGS (Ekholm Friedman and Friedman 2008a:255, 2008b:204, 215), of which one is shown in Figure 1. The theory argues that hegemonic expansions within global systems and cycles, as capital flows into core local- ities and local manufacturing grows, tend to increase the “capitalization” of social relationships, which, in turn, in- creases the likelihood that people will develop modernist, individualist, and future-oriented outlooks within their own specific cultural cosmologies. Conversely (see Figure 1), it predicts that hegemonic declines, with capital flowing out from the former cores and local manufacturing collapsing, lead to a decapitalization of social relations, generating a new search for cultural roots in the form of primitivist, post- modern, or fundamentalist identities (see Nonini, this is- sue, for further discussion of identity spaces as suggested by the Friedmans). Expansion brings a combined sparkling of progress, consumption, and individualism within the eth- nonational framework, whereas decline helps to nurture a retrospective narcissism, a search for authenticity, and a drift toward communalism. Having started out as Marxist critics of Marx, the Friedmans have thoroughly anthropol- ogized and universalized Max Weber on Protestantism and individualism. “The West” these days is in such a phase of compre- hensive decline: The rerouting of capital away from the old core leads to a rerooting of our cultural sensibilities. The strength of this jumbo vision resides once more in its hit- ting at tendencies springing from markets and the money form, and the weakness emerges again from its lack of par- ticularity on capitalism. Until recently, Western capitalism had succeeded in bringing back “enough money capital” to sustain high consumption and high credit levels among the upper-middle to middle classes in the countries of the Organisation for Economic Co-operation and Development (OECD), even though members of these classes are going to need to save more in the near future. It has also, until now, by and large succeeded in keeping control over tech- nology and property rights, thus again feeding its owners

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and cadres in the old core by the work of the proletariats in the Global South and East, the knowledges of indigenous peoples, and the devalued living standards of the reserve army of labor, wherever it is found (see Smith 2011 for an important discussion of “surplus populations” and “selec- tive hegemony”). It is hard to maintain that modernism has completely lost its sway among Western citizenries. We are not back in the Middle Ages yet, even though our optimism for the future is fading. This is not to say that the Friedmans’ predictions are mistaken: Nationalist and Christian funda- mentalisms are structurally on the rise. A neonationalism of the dispossessed and disenfranchised lower-middle and working classes in the OECD as well as in the new produc- tion spaces such as eastern Europe seems vibrant in many places and might become hegemonic in an unfortunate set- ting here or there (Kalb 2009; Kalb and Halmai 2011). Ret- rospective narcissism does abound. But it is not yet of the thoroughly ritualistic kind; rather, it takes the form of a se- ries of serious pun-pricks in an otherwise slowly crumbling cake of modernism, sunk deeply in the institutions of the capitalist (national and transnational) state. After 30 years of that state’s declining hegemony, the future clearly is not so hopeful anymore and the present is fearful, but neither is entirely swallowed by the imaginary attractions of the past. What underlies the actual contingencies at this point is, again, the power balances between classes, the global and local configurations of class that allow capitalist glob- alization to happen but not without forms of complex ne- gotiation in which alliances as well as antagonisms of class are articulated. These negotiations are about the dollar– yen exchange rate as well as about German–Greek relation- ships on the Euro. They are about employment and benefits in China, India, and Poland as well as in Belgium and the United States. They are about the Occupy Wall Street and Indignados movements and worker and peasant rebellions in China and India. And they are about the class charac- ter of global governance, about international labor organiz- ing and social standards. And, of course, about global finan- cial flows and their regulation. These and other institutional fields are the terrain of wars of position and maneuver. The outcome of those wars, globally and locally, determines the fate of modernism in an era of globalization and declining hegemony of an older core. These are the structured contin- gencies not worked out in the AGS . Here we touch at the missing slot in the various possi- ble subject positions provided for in the Friedmans’ vision of modernity as the identity space of commercial civiliza- tions. The genuinely modern position in this vision is ex- clusively an individualist one driven by consumerism and encapsulated in the modern nation-state, with its civic na- tionalism. A mark of Weber again here. The Friedmans, sig- nificantly, do not provide for a collectivist modernist posi- tion that is expressed in rational collective claims on states and capital (see, again, Nonini, this issue). Collectivism only

Financialization and the capitalist moment American Ethnologist

appears in the regressive search for roots under conditions of decline. Rational collective action based on rational col- lective insights is not expected. Capitalism, as I have argued throughout, is about the making of capitalist relations, insti- tutions, and spaces. But, historically, in Marxism, it was also about the possibility of the dictatorship of the proletariat, which, in Marx, served as a metaphor for the attainment through class struggle of collective rationality against the destruction wrought by capital left to its own devices. Later, it was about planning, welfare, development, and a bal- anced international order. Collectivist modernist counter- hegemony against national states captured by financialized capital and cosmopolitan elites, in short, is a missing slot in the Friedmans’ grid of possible subjectivities. This absence is homologous to the absence of a relational–institutional– spatial vision of capitalism . Weber usurps it all. The graphs in AGS are elegant and insightful, but they have a certain agencyless finalism and a taint of science fiction. That is so because they are based on the cover- ing laws of “commercial capitalism” and the universality of Weberian abstract wealth and not on the dynamic so- cial, geographic, and institutional relationship of classes, al- ways in the (un)making, called “capitalism,” a relationship at once crystallized within and structured by the forms of the state. The latter is at once more revolutionary, more “fixed,” and more contradictory then the Weberian ver- sion and therefore, ultimately, more dynamic and open- ended. The Friedmans exclusively provide for a Weberian individualist modern subjectivity within the ethnonational state, whereas modernity has, in fact, been the transna- tional fountain from which (transnational) social move- ments for collective—as well as individual—emancipation have sprung. These two missing elements together produce much more structured contingency, and, indeed, politics, than the graphs allow. But who would deny that the ques- tions posed by the Friedmans are the fundamental ques- tions of our time? Nothing new, they would say. Which is only one of the reasons why an engagement with their work, so singularly ambitious as macroanthropological theory, is so immensely exciting.

Notes

Acknowledgments. I thank Gus Carbonella, Gavin Smith, Steve Reyna, Don Nonini, and, of course, Jonathan and Kajsa Ekholm Friedman for sustained debate. This article has given rise to a sub- stantially longer discussion entitled “Deep Play: Finance, Demos and Ethnos in the New (Old) Europe” (Kalb in press).

1. Arjun Appadurai (2011) takes up Weber too in search of “The

Ghost in the Financial Machine.” He offers fascinating insights on “the culture of finance” and its embrace of complexity and “uncer-

tainty” rather than mere calculable “risk.” However, one does not need a “ghost” to make a financial machine, as the AGS makes per- fectly clear. It is the other way around.

2. Marx seemed aware of the importance of the “Anglo-Dutch

moment” and the Dutch-imposed management practices of the national debt for the actual consolidation of capitalism as a mode

of production. See, for example, Marx 1977:883–884, 919 and Pat- terson 2009:124–127.

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Don Kalb Department of Sociology and Social Anthropology Central European University Budapest, Hungary kalbd@ceu.hu

Department of Cultural Anthropology Central European University and Utrecht University Utrecht, The Netherlands