EssaysFeatureImaginal PoliticsNew Fascisms, Mass Psychology and Financialization

Mass Psychology of Crisis

For a structural analysis of financialization and against the use of “fascism” as a scare tactic

Mass psychology, new fascism, financialization. The conjunction of these three terms is startling. Its meaning is not immediately transparent. To grasp it requires an imaginative leap.

What connects them, for me, is a fourth term, crisis. Not just financial crisis, nor indeed any crisis that is merely sectoral — whether ecological, economic, social or political. I am thinking, rather, of a general crisis of our whole social order as such. This amounts to the sudden appearance of a profound shakiness in social reality: the trembling of its established political routines, the wobbling of an economy hollowed out by finance, the unsteadiness of the climate, perhaps even of nature itself.

We can (indeed should!) think about this sort of crisis on two different levels: call them the structural and the hegemonic. Part of what is unsettling in the conjunction of the terms mass psychology, new fascism, financialization is that they straddle those levels. Financialization pertains to the structural level, while mass psychology and new fascism pertains to the hegemonic level. By conjoining these terms, the organizers of this workshop force us to think both of these levels together. That is not easy, by any means. But it is absolutely necessary for grasping the present conjuncture.

I’ve written a fair amount lately about both levels of the present general crisis. On the structural level, I’ve analyzed the unraveling of the historically specific form of capitalist society, with a historically specific way of organizing the relation between society and nature, production and reproduction, polity and economy. I won’t repeat that analysis here, except to say that financialization is central to this form of capitalist society. In it, finance plays a much weightier role than it did in previous forms. Earlier, it served as an auxiliary to industrial capital, providing credit to enable expensive technological innovations that raise productivity. Today, in contrast, finance is the dominant fraction of capital, which sets the overall direction of investment and development. Today, accordingly, finance is not confined to one specific region of economic space; rather, it has metastasized throughout the whole social landscape: it runs through private firms and private homes, through national states and local governments, through international space and transnational organizations, through communities and neighborhoods, through housing, education, and land, hence the all the pores of everyday life. As a result, finance (or better, financialization) has proved to be a deeply corrosive and destabilizing force — although a tremendous source of profit for investors.

For these reasons, it makes sense to call the present phase of capitalism financialized capitalism (just as we commonly refer to earlier phases as mercantile capitalism or colonial capitalism or state-managed capitalism.)

I won’t say any more about financialized capitalism, except for one crucial thing. In this phase, capital has taken an even harder line than usual in refusing to pay the replacement costs of its necessary supports and inputs — of human labor, of energy and raw materials, of political governance and associated public goods. Truth be told, it has never paid the full replacement costs of these things. But today, it pays even less. The situation is especially clear with respect to labor: wage rates no longer cover the socially necessary costs of reproducing and replenishing workers, let alone their families. Rather, widespread precarity and below-cost wage levels represent a kind of extractivism: no longer content to simply appropriate our surplus labor, capital also appropriates the necessary portion, drilling down into bone. The same is true for the costs of those elements of social reproduction previously assumed as public charges — education, health care, housing, public transport. Insisting simultaneously on reduced public spending and reduced corporate taxes, capital treats those preconditions too as sources of super-profits to be mined in its pursuit of limitless accumulation. Finally, financial capital blithely rejects even the mildest suggestion that it should shoulder some of the costs of mitigating climate change, let alone de-fossilizing the energic basis of its production. In this area too, it is hyper-predatory, lending a new, more literal meaning to the old phrase, “après moi, le déluge.” Truly, financialized capitalism is a system primed to generate multiply stranded crises. General crisis is inscribed in its DNA.

OK. That’s enough on the structural side of crisis. Let me turn now to the hegemonic side. This is the side where mass psychology lives.

Hegemonic crisis is about the sudden collapse of interpretive frames, value horizons, and psychic investments, all of which had previously worked together to suture gaps in the social-political universe. At this level, crisis is first and foremost about disaffiliation. It involves withdrawal from established loyalties, party memberships, and commonsense world-views. The mass psychology of hegemonic crisis consists in being set adrift, being disoriented and disconnected. It is a hard, uncomfortable place to inhabit. And it’s not in the long run sustainable. On the contrary, hegemonic crisis is necessarily lived as an interregnum, a way station en route to some new dispensation: a new worldview, a new set of affiliations, new political loyalties and existential investments.

Hegemonic crisis is lived, in other words, as a restless search for answers to the followings sorts of questions: who are my allies, and who are my enemies? What should I believe? What can I hope for? Who am I/ what is my community? Who are my fellows?

These questions become insistent in moments of hegemonic crisis. But the answers don’t readily consolidate. People tend, rather, to stay in an “experimental attitude” (Dewey). They try this, then that, then something else. The hallmarks are volatility and lability. We see this at the electoral level: first they vote for Brexit, then for Corbyn; first for Mélenchon, then LePen; first for Sanders, then Trump.

I would like to see practitioners of mass-psychological analysis focus less on the seemingly unshakeable attachment of Trump’s diehard followers and more on the uncertainty, the disaffiliation, the adrift-ness and experimentalism of the broader population. That seems to me to be the most striking feature of the mass psychology of the present crisis.

One reason I prefer this focus is that is captures the openness of the present moment. It allows us to think more critically about the terminology that is thrown into this breach as various elite actors attempt to manage it, to re-suture the gap to their own advantage. The terms “regression,” “populism, “new fascism” seem to me to function as totems of such re-suturings. They serve to freeze a landscape that is actually much more open and uncertain.

Although I agreed to have my essay published in The Great Regression, I always hated the title. The whole point of my essay in that volume, and indeed of my talk here today, is to enhance the possibilities for non-regressive outcomes, for an emancipatory, transformative resolution of the present crisis.

There has been a great deal of analytic work by historians and social scientists aimed at defining fascism, enumerating the essential traits that a political formation must display in order to merit that label. I’m not myself involved in these discussions, and I don’t want to engage the question here at this level.

I’m focused, rather, in the performative force of the term “fascism” (or “new fascism”) in the present context. As I read it, it’s a call to order, to re-affiliation, to re-consolidation, to closure. It’s a call above all to close ranks with the liberal elites who present themselves as our “protectors,” but who could more accurately be seen as our predators.

“Fascism” is, in other words, a scare tactic. It is used to say something like this: things are too dire, too far gone, too nearly closed to remain in an experimental attitude. Forget Sanders, forget AOC, forget your childish utopian dreams. Move to the center. Return to the liberal center, reconnect with the grown-ups, re-affiliate with the benign parental figures who can protect you from the bad bogeymen.

The phrase “great regression’ works the same way. Even “populism” (a term with a much more complex genealogy) is used to designate the penultimate stage before fascism, the slippery slope to perdition: go there and you won’t find your way back.

Eli Zaretsky raised the question of the relation between “populism” and finance. I don’t know exactly what he had in mind. But one all-too-common interpretation is that the American populists of the late 19th century were paranoid (possibly even anti-Semitic) in demonizing finance. At the very least, they were crackpots, who imagined they could solve their problems by replacing the gold standard with silver. But I’m inclined to think that despite the absurdity of the silver panacea, their basic instincts were quite sound, that the trusts, the banks, the railroads really were the forces destroying the livelihoods of small farmers.

I am trying to avoid repeating my analysis of progressive neoliberalism, which I assume many of you already know. But it’s my view that progressive neoliberalism was the hegemonic bloc that sutured the political universe prior to Trump. Its hegemony is what collapsed. And no wonder! It was the progressive neoliberal bloc (in the form of Clintonism) that oversaw the shift to neoliberal financialized capitalism. Where they didn’t install financialization, they consolidated it. Where they didn’t invent neoliberalism, they repackaged it as “progressive” and gave it legitimacy.

So, is the collapse of progressive-neoliberal hegemony really “a great regression”? Or is it a necessary step on the path to creating something better? Who benefits from the rush to fix the meaning of the present interregnum via terms such as “regression,” “new fascism,” “populism”? What do these terms serve to obscure? What is left out of the picture they paint?

In brief: Alexandria Ocasio-Cortez. Bernie Sanders. Podemos. The possible rebirth of the British Labor Party as a leftwing party. The struggle to reorient the Democratic Party to “democratic socialism”; to struggle to defeat the forces seeking to revive progressive neoliberalism, to give it a cosmetic makeover, and to restore the status quo ante. What is left out, in a nutshell, is the struggle to build a counterhegemonic left project.

Let me conclude by reprising a question posed by Arjun Appadurai: whose narrative wins when left narratives are missing?

Make no mistake. The present interregnum is the scene of a battle for hegemony in Gramsci’s sense. Financialization continues on steroids, but its legitimating ideology lies in tatters. The result is a rare historical moment of political dis-affiliation and mass-psychological experimentalism. It is a moment when critical masses of people no longer believe the ruling commonsense and are willing to think outside the box. It is entirely premature to brand them as “regressive” or “fascistic.” The last thing we need is to allow such scare tactics to close down the space of experimentation that represents our best hope for an emancipatory resolution of the present crisis.

Nancy Fraser (New School) discussed the role of ‘crisis’ in the structural operation of financialization, offering insights on the opportunities for experimentation contained in the political spaces of ‘populist withdrawal’ from the promise of neoliberalism.

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Nancy Fraser

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