October 2009 • Anthropology News

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Anthropologizing EconomicsLessons from the Latest Crisis

Richard Robbins Plattsburgh State U

According to the International Monetary Fund, the total global equity loss since 2007—including losses to the financial sector,

corporations, homeowners and unincor-porated busi-nesses—totals some US $40 trillion, or about two-thirds of the

world’s GDP. In human terms, the International Labour Organization estimates that world-wide unem-ployment could rise by at least 30 million people, and possibly as many as 50 million people, from 2007 to 2009, while more than 200 million people, mostly in developing economies, will fall into poverty. How, as anthropolo-gists, do we explain the crisis, and how might anthropology actively engage in policy discussions to prevent it from happening again?

Historically, of course, the crisis is not unusual. Beginning with the tulip bubble of 1637, the South Sea bubble, the collapse of British railway stock through various post-war economic collapses, the Great Depression and on to the collapse of technology stocks and home prices, the precipi-tous decline in value of mostly overpriced assets has bedeviled our economic history. Although there have been various economic reasons for the collapse of specu-lative bubbles, and various failed attempts to prevent them, most explanations center on human greed, thereby assuming that if we can put mechanisms in place that somehow control individual acquisitiveness, we can prevent or at least mitigate the impact of such collapses. However, that may be a fool’s errand.

Ernest Gellner referred to the West as “the society of perpetual growth.” What this means is that, on average, every person and busi-ness must spend or earn more this year than last, and more next year than this, in perpetuity. Why this is so is rarely examined.

Economists largely treat the desir-ability of economic growth as self-evident, claiming that growth will solve such problems as hunger, poverty, social injustice and envi-ronmental devastation. As Edward Fischer describes elsewhere in this issue, this is similar to the unprob-lematized ways in which many also view capitalism and the “free market”: as “natural” and unques-tionably effective for meeting soci-ety’s needs. It is time to question these assumptions.

Debt and GrowthIn Fool’s Gold Gillian Tett makes a persuasive case that the culture of finance is such that even financial instruments designed to mitigate risk, when misused, can greatly increase it. She describes the efforts of a few financial innova-tors to come up with new credit-based financial products, in one case being instructed to “make at least half your revenues each year from a product which had not existed before.” In effect, finan-cial institutions were doing at the micro-level what the larger economic system requires at the macro-level—accelerating capital accumulation. However, I am less inclined to attribute the need to grow to individual or even insti-tutional greed. Rather, I see it as embedded in the nature of our economic system itself, which drives the need to constantly invent or discover new ways to convert stuff and activities into goods and services, to use earn-ings to further expand the market, to produce more and to consume more. But why is this the case? That is, if perpetual growth is not attributable to greed or self-interest, and if it is not desirable in itself, then what is the internal logic of the market as consti-tuted that requires the economy to perpetually grow, and hence, periodically collapse?

Historically this propensity to require growth goes back only to the sixteenth and seventeenth centuries and is attributed by historian Liah Greenfeld, in her book The Spirit of Capitalism,

to nationalism and the desire of countries to outperform their neighbors. Niall Ferguson, in The Cash Nexus, hints at the reason for growth when he attributes the development of Western demo-cratic institutions to the need of governments to tax the popula-tion to repay debt incurred in war. As he points out, once you have acquired debt, there are a limited number of ways to reduce it—default, restructure or grow—only one of which retains the integ-

rity of the economic system. In other words, debt and investment require perpetual growth.

Since countries, financial insti-tutions and individuals have been incurring debt or expecting returns on investments, the need to grow has vastly increased, never more so than in the past decade. In the United States, total government, corporate and individual debt totals over $57 trillion, $46 trillion of which has been created since 1990; global corporate bond debt is $54 trillion, as is total country debt. The questions we must ask are: what is the level of growth required to honor these debt obli-gations; what are the social, polit-ical and environmental costs of this growth; and, more impor-tantly, how are necessary growth rates to be maintained? The last question is particularly important because the wealthier a country becomes, the more difficult it is to sustain necessary rates of capital accumulation (eg, consump-tion, production and profit level). Anthropologists can contribute by posing questions about economic growth that are not part of current economic paradigms.

Anthropology’s RoleFirst, we need to demystify or, in the words of Paul Rabinow, “anthro-pologize” economic growth and show how it is historically peculiar and linked to social practices, indi-vidual behaviors and institutional priorities. The term “economic growth” is itself a euphemism that masks far more than it reveals. Few can argue against “growth”;

it embodies the tropes of prosperity, progress, maturity and advance-ment, opposing stagna-tion, decay and decline. But when they use the term “growth,” what economists really mean is that each of us, on average, must produce and spend 3–5% more this year than last, and 3–5% percent more next year than this, in perpetuity. If for some reason, we all produce and spend the same or less this year as last, turmoil ensues. When we turn debt into a commodity, and devise ways to create and sell more of it in order to amplify growth, a rapid acceleration in both the world money supply and global debt naturally results.

Second, economists conclude that the factors contributing to economic growth are “myste-rious.” But are they? Karl Polanyi pointed to the commodification of land, labor and money as central to the growth of the market. The past 50 years have been character-ized by the increasing commodifi-cation of the natural world, social relations (eg, family functions), political influence, and cultural traditions. Anthropology is well-suited to examine the price we pay in converting non-monetary capital into money, and to demon-strate that the process is myste-rious only to those who choose not to understand it.

Third, anthropologists should reexamine the privileged role of technology in economic growth. New technologies do more than simply create more products and services to buy and sell. In boosting market “efficiency,” new technologies accelerate capital accumulation, making it possible to produce and distribute goods and services faster and faster. Thus, agricultural technology focuses on producing crops or animals faster, communication technology on accelerating the exchange of information, and financial technology on creating and selling financial instruments (including credit derivatives) to more people in less time. This compression of time and space in the interests of rapid capital accu-mulation compounds the severity of any negative impacts of market growth, and spreads the effects across increasingly larger groups of people.

C O M M E N T A R Y

See Lessons on page 12

Anthropology News • October 2009

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the reorientation of meaning will not be the unilateral prerogative of the US. This analysis will involve more sustained ethnographic attention to some rather predict-able institutions such as the Federal Reserve System, government regu-latory agencies and banks, but it will also involve scrutinizing the changing business models of US manufacturers, adaptive strat-egies of pension fund managers, and responses of the contemporary labor movement, to name just a few possibilities. It also entails investi-gations of the formal institutions charged with the regulation of the global economic system, such as the World Trade Organization, as well as the corporate, governmental and household bodies of countries such as China and confederations such as the EU. In moving in and through these various spaces, the object of inquiry is not organiza-tional culture per se, but rather the nodes of connection that unite diverse agendas and behaviors and give them momentum at the collective level.

This research program is inher-ently collaborative and multi-scalar: it cannot be mastered by a single anthropologist nor undertaken in a single institution at a single level of scale. It involves a raft of method-ological techniques—conventional and innovative—and it attempts to speak to issues of broader economic, political and social significance. Quite simply, it is everything that twenty-first century anthropology should be. Perhaps the global crisis of economic meaning is the ideal antidote for anthropology’s own crisis of meaning.

Tara A Schwegler is a visiting scholar at the Teresa Lozano Long Institute for Latin American Studies at the University of Texas-Austin and lecturer at the University of Texas-San Antonio. Her research focuses on the inter-section of neoclassical economics and social welfare policy in Mexico. She recently edited (with Michael Powell) a special issue of Anthropology in Action devoted to methodological challenges in the anthropology of policy. She can be reached at tara.schwegler@utsa.edu

Meaningcontinued from page 9

goods. Take Germany, Sweden and the northern European model, or China with its hybrid economy. Clearly, there are many possible ways to construct market economies.

We must recognize the value in market efficiencies—the wealth market economies have produced, and the quantity and quality of life they have increased. Yet we should not naturalize or deify markets. Keeping firmly in mind that they are social constructions allows one to see markets not as absolute, omnipotent forces but as tools, instruments and techniques in the social and political project of living together to the greatest mutual benefit (as we define that socially and politically). This means that markets can and should be regu-lated to provide the greatest good for the greatest number. We need not put off difficult social and polit-ical questions about the quality of life onto simple material and finan-cial cost/benefit analyses.

We have been too quick in recent years to disavow tough political (and moral) decisions (about who get gets what, what is a “just” wage, and so on), leaving these to an almost religious belief in market forces to work out optimal solu-tions. Markets do lots of good— healthy market competition increases efficiencies, and we should let them do their work in the contexts they work best. But we should not let a notion of “natural” markets shy us away from making political decisions. The current crisis in the markets forces us—and policymakers—to see them as the contrivances that they are. Markets are neither inher-ently good nor bad—they are tech-niques and instruments that we can put to the social and political uses we see fit.

Edward F Fischer, professor of anthropology at Vanderbilt University, studies issues of culture and political economy in Guatemala and Germany. Many of the ideas in this commentary were inspired by a recent School of Advanced Research Seminar on “Markets and Moralities” organized by Peter Benson and Fischer. See also www.tedfischer.org.

Capitalismcontinued from page 10

Finally, anthropology can contribute to economic policy debate by exploring, as Tett does in her book, how the cultural ethos of perpetual growth becomes insti-tutionally operative. How much of the current economic crisis, for example, is about risk and how financial institutions, in their need to grow and keep up with the competition, failed to measure accurately the dangers posed by their inventions? Answering such

questions through on-the-ground research with those involved in financial industries is a key way that anthropologists can help understand, and perhaps prevent, future economic crises.

Richard H Robbins is SUNY Distinguished Teaching Professor at Plattsburgh State University. He is the author of Global Problems and the Culture of Capitalism ( fourth edition) and co-editor, with Gary Kroll, of World in Motion: Globalization and the Environment. He is also editor of the series “The Anthropology of Stuff ” for Routledge Press.

Lessonscontinued from page 11

In recognition of the 20th anniversary of the Native American Graves Protection and Repatriation Act (NAGPRA), Anthropology News seeks contributions for a thematic issue on repatriation, broadly conceived. Since its passage in 1990, NAGPRA has prompted significant and compelling conversations on issues such as intellectual property rights, identity politics, human rights and professional ethics. Beyond NAGPRA, researchers, educators and practitioners in all areas of anthropology engage with questions involving repatriation on a daily basis, whether tracking the lineage of a museum artifact, informing policy on cultural heritage, or facilitating the return of refugees fol-lowing a conflict.

We welcome proposals for In Focus commentaries, Teaching Strategies, Field Notes articles, photo essays, news stories and interviews that address the repatriation of people, objects and intangible heritage from a wide range of angles including (but not limited to):

February 2010 Anthropology News Call for Proposals

Theme: Repatriation

Proposal submission deadline: October 20, 2009

Early submissions are encouraged.

To participate, email a 300-word abstract and 50-100-word biosketch to Anthropology News editor Dinah Winnick (dwinnick@aaanet.org). Proposals for photo essays should also include five high resolution pho-tographs (tiff or jpg), each with a caption and credit. Selected authors will be asked to submit commentaries of 1000-1400 words or shorter pieces for other article types.

•Visualheritageandintellectualpropertyinadigitalage•Illegalartifactexcavationandtrafficking•Interpretinggenetic/culturalaffiliationandpatrimony•Theconsultationprocessandnewcollaborations•Tribalheritageprogramsandtribalsovereignty•Displacement/endangermentofpeopleandartifacts through conflict•Refugeeresettlementanddiasporicculturalcommunities•Returnofeconomicmigrants•Memory,identityandtemporality•Globaldiscontinuitiesinrepatriationpolicy•Humanrightsandsocialjustice•PracticesrelatedtoNAGPRAcompliance

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