Author: Ariel

Karen Ho initiated the fieldwork for Liquidated: An Ethnography of Wall Street by obtaining employment at Bankers Trust NY Corporation, a Manhattan investment-banking firm, for 6-months before she was eventually “restructured” out of employment there. Ho utilized kinship bonds via colleagues she’d met during her undergrad and graduate degrees at Stanford and Princeton and the aura of “smartness” attached to those institutions much in the same manner that the majority of young investment bankers did to obtain their position. She than expanded the scope from her own experiences to include those that she interviewed via contacts she made over a three-year period.

Ho connects this portrait of embryonic and low-level finance culture illustrated to traditional historical writing that limns the development of the American corporations divergence from stakeholder models of business to the prioritization of shareholder value. As Ho shows, in sections that would make good companions to excerpts from Balogh’s A Government Out of Sight, this perspective emerged first as a result of legal rulings contesting the nature of who the modern corporation was meant to serve – the public interest or the private shareholders. What develops is a judicial imperative to serve the former no matter the cost to the latter and the adoption of a financial model that concerns itself solely with the bottom line shown in quarterly reports rather than the long-term prosperity of the corporation, its employees or anyone else otherwise connected to them. The implications of these rulings have huge social and economic effects, ones leading to increased “liquidity” justified, at its base, by the need for increased capital return. Shareholder value, however, is not just a business practice but, like that of Christian free enterprise, has a moral tenor to it. It “…meant more than raiding the stock price of a corporation, it also signified a mission statement, a declaration of purpose, even a call to action. Creating or reclaiming shareholder value was morally and economically the right thing to do, it was the yardstick to measure individual as well as corporate practices, values, and achievements” (Ho 125).

Using the language and conceptual framework of the dismal science, economics, this rhetoric encouraged illogical corporate mergers and hasty leveraged buyouts that served to temporarily boost stock prices, while simultaneously rendering thousands unemployed, millions of dollars of corporate assets stripped, and driving the longevity of hundreds of corporations straight into the ground. This viewpoint additionally glossed over the inescapable interconnectivity between financial actors, neglects numerous other stakeholders and glossed over the “smartness” of those running the business about to be purchased by a conglomerate with that of the fresh faced newly grads incentivized to continuously be breaking apart and putting together new combinations.

Ho discusses this shift away from the stable corporation dominated market of the 1950’s and 60’s with an almost nostalgic tone, mourning the marginalization of the perspective that the combination of government regulation and corporation as social bodies offering its citizens/employees certain forms of stability and protection from the market forces. With the increasing emphasis placed upon the individual to guard against all possible outcomes, this is understandable. Freedom is not just that ability to do as one pleases but to be free from imposition, be it levies or need to engage in increased attention to myriad economic indicators due to the deinstitutionalization of financial security within the private and public sector.

In this vaguely concerned as to the state of business affairs vein, Liquidated is akin to To Serve God and Wal-Mart and Liar’s Poker, where we see an insider account of the business practices constituting the markets and culture of neoliberalism. Ho, however, differentiates itself by delving further into the abstract rhetorical practices used within the industry to obfuscate the social and material realities that conceptualize businesses as “too big to fail” and individuals are “too small to be cared about.”

Bethany Moreton’s book To Serve God and Wal-Mart: The Making of Christian Free Enterprise historicizes the Ozarks region, showing how the growth of Wal-Mart was related to the yeoman ideal and a feeling of resentment towards Northern bankers. Legal mobilizations occurred in these regions against northern owned chains coming in during the 1920’s as a means of “preserving competition by denying the combinations their unfair advantages” (Moreton 17). During a period of economic hardships mandating thrift and with the development of a “home-grown” chain that is able to produce a quasi-Christian image reflecting the values of the community – Wal-Mart is able to become successful. These two developments are intimately related. As U.S. manufacturing jobs moved abroad (a process dealt with in more detail in Judith Stein’s A Pivotal Decade) it created shifts in economic subjectivity, largely by creating the need for households to have multiple income earners. This occupational/economic context was addressed by Wal-Mart’s low prices and employment opportunities. Management positions are prioritized for men emerging from Christian colleges while service labor positions were offered to unskilled women, not as a means of obtaining economic self-reliance but as a means for supplementing the primary income of their husband. With the both adult members of the family working, childcare was now often delegated (externalized) to immediate family and community members, a situation that was celebrated as it encouraged the values of the hearth rather than the market. Moreton’s focus on description rather than valuation can lead the reader to believe either that those believing the servant-leadership model proselytized by Wal-Mart aren’t dupes operating within the confines of false consciousness but adherents to a new “Christian” system, or that they are. It is this ambiguity, I believe, that made the book so popular by readers that weren’t strictly speaking academic (it’s the only academic book that I’ve ever seen at an airport book store).

That ambiguity of the text laid out, I think it’s important to note that Moreton’s description of servant-leadership seeks to supplant previously existing populist ideologies that were antagonistic to “the feminization of labor”. Lower wages are here naturalized, supplemented with notions of personal benevolence on the behalf of the employer and social conservatism. The concept of the servant leader is an alibi within a structurally static hierarchy that reinforces gender norms of men as leaders and women as subservient. Moreton also shows how such an operational ideology helps create the strange alliance between evangelicals and military hawks, due to the valorization of obedience and the conflation of capitalism with Christian values.

Moreton doesn’t just rely upon the oral histories and available literature but also shows how as Wal-Mart expanded they sought to recreate the practices that originated in the Ozark region in their competitive quest to be the dominant chain retailer. Specifically, through their associations with groups such as the Business Round Table and financial donations to school’s M.B.A. programs, Wal-Mart sought to counter-act the anti-capitalist sentiments created by a higher level of education. Through a result of their combined efforts: “By 1981, graduating business majors already outnumbered their classmates in all languages and literatures, the arts, philosophy, religion, the social sciences and history combined” (Moreton 151). The emphasis of this education was of an explicit anti-leftist orientation and these courses promoted mythologies rather than material realities.

In a final note, I want to argue against claims that “Christian free enterprise” is not defined by Moreton. As I’ve tried to show in the above exegesis of the text, it seems to me that the word is a positively conceived code phrase for “neo-liberalism”. Whereas Liar’s Poker is an account of the pursuit of money as a religion, here we see an ideology in which it is more important to pursue religion and money is secondary to the social relationship in which it is made. In this way those that would say the phrase is an oxymoronic trope are correct – for it elides the sites of Wal-Mart’s production and numerous of Christianity’s generally accepted values – but that doesn’t mean it isn’t operative in the manner in which Moreton outlined.

Liar’s Poker by Michael Lewis is a first person account of his employment with Salomon Brothers during the time that a number of new financial instruments such as mortgage backed securities and junk bonds were created. In contradistinction to the books that we’ve read thus far this semester, with the exception of a section of Galambos, the book is unique in it’s insider insights into the culture and context of these developments as well its colorful character descriptions.

Lewis memoir is in a way a eulogy for Saloman, which was purchased by Citigroup in 1998. By recounting the many ways it was unable to properly manage its growth, diversify its offerings when new ones were created, create a stable, sustainable staff Lewis shows how the company analysts had trouble looking at themselves. The listing of the sophomoric pranks, culture of fatness, lack of seriousness on behalf of the trainees, inability for upper management to maintain talented employees, the internecine departmental conflicts leading to purges of talented people as well as the desire to project a grand image in new and emerging markets (London) that hadn’t yet wholeheartedly embraced the New York model reads like a litany of decadent symptoms that would have been cause for it’s buyout and dismantling by those such as Michael Milken, who did try to do just that.

In the tight focus on Saloman, it’s investors and the companies it interacts with the broader economic implications fall by the wayside. For instance, one of the topics which has been discussed extensively in class has been the government’s regulatory relationship to markets. We learn that Lewis Ranieri was instrumental in creating the framework for the national legality of mortgage bonds by transforming the state-to-state legal codes presiding over such issues into a national one.

While in accordance with mass-market consumers values, the book is light on it’s citation. It’s not just the foregoing of an annotated bibliography, but the stating of certain events and circumstances happening without giving much background. I think this a strength as it does not scare away the casual reader, but an annotated companion piece, preferable free and posted on the author’s website, would be a welcome addition to those interested in following at least some way down a path of further inquiry.

As President Nixon’s National Security Advisor and interlocutor in the process that helped China transition from inward-directed autarky to export-oriented international player on the world stage, it is of no surprise that Henry Kissinger’s On China presents a compelling account of the country’s history that is both fond and insightful. Some reviewers of the book have called it excessively idiosyncratic, but considering the wealth of history lived by the author and the credentials of the presented by the team that helped him research it I don’t find this to be an issue. Kissinger frames their history prior to his dealings with Chinese diplomats not so much to give a total history of China, but to saliently frame the political issues that relate to the initiation and maintenance of positive diplomatic relations.

Kissinger views both the US and China as countries with national perspectives defined by their exceptionalism, though in drastically different ways. Whereas America imagines that it’s set of democratic values are eternal, judges other countries according to it’s particular moralistic standards of the moment and in a missionary sense seeks to replicate it’s values in other places, China doesn’t hold that it’s values are applicable anyplace else. The actual geo-political results of such a belief system backed by their economic dominance are substantial. Prior to the European’s development of heavy naval warfare, the Chinese were the dominant world power that were so self-content and uneasier to impose themselves on others that they deconstructed their naval fleet following a Mediterranean tour where they gave out wealth to the ports they stopped at as they were under the impression that there was nothing outside of the Middle Kingdom that was not already there. This is not to say that they weren’t afflicted by barbarian, semi-nomadic hordes, but that prior to their feeling the effects of industrial revolution age weaponry, there was nothing that particularly interested them and foreigners were to only be admitted to the country at certain sites at certain times of the year.

The Chinese long sense of history of provided a framework for patience and endurance of many terrible circumstances while their particular geographic position helped imbue specific conceptual insights that is perhaps best seen in the game of Go, a game that makes Chess seem positively sophomoric. On this latter point Kissinger points out similar insights as Deleuze & Guattari, but also includes throughout this diplomatic and political history of China with great effect. On the former issue we also see throughout how it is that the economic and political maneuverings of the CCP were in part informed by the wealth of their cultural and Confucian past. For instance Kissinger explains that within the Confucian principles that have guided China’s course for thousands of years, until the century of humiliation and their anti-imperialist struggles, the nation’s “spiritual fulfillment was a task not so much of revelation or liberation but patient recovery of forgotten principles of self-restraint. The goal was rectification, not progress” (14). The writings of Confucius emerged from a period in which China was again being reunified following a breakup of it’s historical land mass – a similar set of circumstance prior to Mao’s unification of the majority of China. Additionally, Kissinger tell of several instances wherein classical Chinese literature is used to inform political policy and states that “Mao owed more to Sun Tzu than to Lenin” (102). One such example tells how several disgraced General’s justified their position on whether or not to attempt to open to America due to the Chinese fear of China by referencing classic books then banned due to the Cultural Revolution. Amusingly enough, having based their sense of geopolitics on balance of forces model of the Westphalian system, it was these types of decision-making processes that made it so difficult for Russia and the United States to understand their strategic maneuvers.

The descriptions of the various summits designed to normalize relations between the country as fascinating.The manner in which Kissinger describes how a “communist” country was able to reconcile with a “capitalist” one, the shifting alignments amongst countries in South East Asia, Stalin’s masterful strategies for influencing Asia and how it is that the Chinese were able to use small acts to obtain large benefits are just several aspects of the modern period worth highlighting. Furthermore, in this period the 2011 J.P. Morgan Summer Reading List sticker on the font cover of my book began to make more sense to me (I bought the book used from Amazon). How to deal with the management of various crises as well as strategies for continuing fruitful, productive relationships despite temporary and essential set-backs is something that Kissinger can go into at moments without appearing didactic but simply helpful. Additionally, the section on Deng Xiaoping’s assumption of power can be seen as a compelling call to the benefits of reform for the purpose of unleashing creative energies and destroying the old, limiting prohibitions that left the country in poverty for the sake of ideological purity.

One of the surprising aspects of the text for me was the respect and deference towards which Kissinger displays towards the Chinese communists, especially Zhou Enlai and Mao Tse-Tung. Mao, like Stalin, is still a bogeyman in many a political circle but, unlike Stalin, does not receive the Kissinger’s approbation. One could say that this could be explained away by Kissinger’s concerns towards maintaining positive diplomatic relations following his having spent a significant portion of his career on creating and sustaining meaningful dialogue – however I do not think this to be the case. I claim this as Kissinger does highlight what he sees as some of Mao’s negative qualities, such as his circuitous and philosophic manner of speech, yet simultaneously claims that it was his fearlessness towards nuclear weapons that kept other countries from invading, that the high death toll during the three difficult years was not the fault of the CCP nor even exceptional in the history of the region and that to an extent the conflicts of the Cultural Revolution were impossible to avoid unless China wanted to risk another civil war of greater intensity than before. Scene such as Mao’s entreating of Khrushchev to discuss the return of portion of China taken by Russia with him in a swimming pool rather than a meeting room are evokes moments that are humanizing and humorous, as Khrushchev, who could not swim, was forced to wear water wings.

Two final notes partially related to On China. Firstly, this is the second book of Kissinger’s I’ve read and I must admit that like Diplomacy, Kissinger again shows here that he is an excellent stylist as Churchill was. Kissinger’s pre-revolutionary history of the China is, despite it’s brevity, a paean to Chinese culture that unlike few other books made me feel ashamed for knowing so little about the oldest human civilization. I knew various aspects about it, such as it being the first institutional meritocracy, their non-expansionist politics, etc. but admit that after reading this I yearn to learn more. While I’ve no intentions in becoming a Sinologist, and will likely read Red Star Over China, which currently sits on my shelf, prior to anything else due to my desire to now learn more about their re-independence I must admit what little bit I learned here about Mandarin culture makes me want learn more, be it by reading the classical Chinese novel such as Outlaws of the Marsh, Journey to the West, A Dream of Red Mansions, and Three Kingdoms or some other text that I’ve yet to pinpoint.

Mansel Blackford’s monograph Making Seafood Sustainable: American Experiences in Global Perspective is primarily a history of the development of the American regulatory regimes in the fisheries of the Pacific Northwest. That such a development occurred while the truck transportation, airline, rail industries were being deregulated by may seem unusual, but is explained by different set of conditions composing their industry. For one, the increased capacity of new, technologically advanced boats following World War II to bring in and even process ever larger catches with greater efficiency was a new force. To speak to the novelty of such an occurrence Blackford quotes a marine biologist who says that “the twentieth century heralded an escalation in fishing intensity that is unprecedented in the history of the oceans, and modern fishing technologies leave fish no place to hide” (15). Secondarily, domestic fishers appealed to government for greater-sized regions to exclusively exploit; thus regulations emerged to progressively force out foreign capital from extracting the limited resources. Following the Fishery Conservation and Management Act of 1976, regulations increased barriers to foreign exploitation of fisheries from 12 to 200 miles off the coast of U.S. borders and helped formulate limits to the amount of specific types of fish could be taken. With these factors, at wide variance from the other industries mentioned, regulation became conservatory rather than seeking to facilitate the rapid extraction of maximum profits. These are not, however, the only two factors affecting the form of subsequent regulation and Blackford opens the book by illustrating the historical milieu of the Northeast and California fisheries that helped inform policy makers how to proceed once a regulator body was formed.

Since the inception of the industry in the northeast Atlantic, fishers extracted from the commons of the ocean in their region in a largely unsupervised manner. In California, the fisheries had the resources involved in their catches take a second place to other industries such as electricity and construction. The result for both was a tragedy of the commons, wherein fish were no longer able to reproduce themselves fast enough and stocks were depleted to the point of near extinction. Despite late attempts at curbing catches to a sustainable level, damage to the stocks had been done so that that fishing had to be banned outright for a period of time so stocks could restore themselves. With this knowledge in mind, the northwestern fishers nor various environmental groups wished to see this replicated, so a disciplinary regime based upon scientific analysis of available stock and industry leaders requirements for profitability was formed. As Blackford then shows, this wasn’t a large enough constituency and they had to include other groups that had traditionally fished in that region such as native communities and particular Alaskan villages. Following the creation of a maximum catch allowable, a quota system with percentages of the potential catch had to be distributed amongst those groups. These portions were highly contested and led to conflict amongst various historical stakeholders with the new, big-capital corporations investing in processing and distribution.

At several point throughout the work Blackford relies upon novels in order to depict the life of fishers and the changes occurring as a result of these regulatory and technological changes that made Alaskan fisheries into the most regulated industry in the United States. In addition to this, it provides an aesthetic element that shows the terrifying and sublime aspects of the job that seems to readily appeal to intellectuals looking for a break from their work in the form of strenuous manual labor. Additionally, Blackford includes numerous descriptions of the daily operations of the processing industry that shows how seemingly banal technological developments and hygienic standards could have huge impacts on the industry.

I believe Mansel was a little too soft-handed when writing on the entrepreneurial ideology anathemic to government intervention held by so many of the fishers. While he need not go deeply into the content of an ideology that doesn’t recognize the fact that the federal government purchased Alaska for 7.2 million dollars in 1868, invested in the infrastructure that allowed the fisheries to transport their goods to southern markets, provided for the search and rescue operations which their lives depended in event of capsizing, or acted as police to keep foreign resource extractors out of the fisheries, it certainly speaks volumes to their incredibility as a legitimate institutional guides in helping determining maximum optimal catches in councils. As this is one of the factors Blackford’s conclusion focuses on, in the context of his endorsement of Elinor Ostrom’s cooperative, natural resource management framework, I think it’s worth more than just letting pass, especially having mentioned that the European attempt at a similar regime has ended so poorly.