The Real Wolves of Wall Street: Examining Debt, Austerity, and Accountability through the Lens of Primitive Accumulation

ABSTRACT

This article looks debt and austerity as a contemporary form of primitive accumulation. Marx saw that the transition from feudalism to capitalism was accomplished not only by enclosures and the enslavement of peoples of the Americas and Africa; it required an ensemble of ideas and stories that justified these actions. Today’s expropriation by debt also requires public discourses and cultural productions that work in concert with the coercive mechanisms of the state to protect the interests of the rentier class and shift accountability for financial malfeasance to others. It examines the ascendency of neoliberal economic policies in the United States, and then it examines the narratives that accompanied it through three feature films about finance. These films construct dual images of masculinity that portray men as either the “bad boys” of Wall Street, or their obverse, sober and responsible guardians of the financial order. They contribute to a public discourse in which insider trading and stock market manipulations are not, in and of themselves, blameworthy. What is blameworthy is a particular type of failure, and it is this discursive move that allows both the moral culpability and economic consequences of debt to be shifted from the elites to others.

KEYWORDS:

• Primitive accumulation
• debt
• accountability
• austerity

Disclosure Statement

No potential conflict of interest was reported by the author.

Notes on Contributor

Drucilla K. Barker is a professor in the Department of Anthropology and the Women’s & Gender Studies Program, University of South Carolina. She is a radical, feminist economist whose research interests are globalization, feminist political economy, and economic anthropology. Her work is interdisciplinary and from ranges from examinations of the roles of gender, race and class in social valuations of labor, especially affective labor, to accounts of the financial crises that characterize late global capitalism.

Notes

1. The rentier class refers to the class of people whose income comes from the returns on financial assets: insurance company executives, stockbrokers, investors and bankers.

2. My argument here is based on Minsky’s (1992) financial instability hypothesis. Others writing in the Marxist tradition, argue that capitalist over-accumulation is at the root of financial crises (Harvey 2004; Lazzarato 2013).

3. The difference between structural adjustment policies and austerity policies is one of semantics. See Katie (2015) for an interesting discussion.

4. See the Foucault (Foucault and Gordon 1980) interview “The Confession of the Flesh” for a further discussion of the concept of an apparatus.

5. Although the separation of reproduction and production has been discussed extensively in feminist literature with reference to the creation of the nineteenth century affluent housewife as a lady of leisure, Federici’s (2014) treatment is unique in that she situates this separation at the beginning of the sixteenth century.

6. The distinction between primitive accumulation and accumulation by dispossession is used to preserve a binary between capitalism and its outside.

7. Not all financial firms were bailed out, Lehman Brothers being a prominent example. A discussion of all the reasons why they were allowed to fail is beyond the scope of this article, so let me just say that like all classes, the rentier class is neither homogenous nor altruistic. Nor are economists always of one mind on which policies are appropriate.

8. See Harvey (2011) for an in-depth exposition of the rise of neoliberalism.

9. For a more complete explanation see Hudson (2012). There are also a variety of good documentaries on the subject such as Inside Job. I have also found the website, Investopedia, to be both accurate and simple in its explanations of financial concepts.

10. There were rare exceptions. The medical doctor turned hedge-fund manager, Michael Burry, did investigate what is in the CDOs, saw the large number of subprime mortgages, and recognized the consequences. He predicted the housing market would default when the interest on the adjustable rate mortgages rose. His story is documented in the biopic The Big Short.

11. This is similar to the argument made by Nelson (2017) in her work on gender and finance. She argues that a more gender diverse workplace would be socially beneficial for financial markets. This is not because women are innately less risk averse than men, her work decidedly refutes this claim, but rather because women would bring with them gendered behaviors, such as carefulness and regard for others, which would over time discourage reckless cowboy-type behaviors.

12. See De Goede (2005) for an excellent discussion of the Merton-Bolles contribution to reducing risk through arbitrage.

13. Michael Hudson is a financial journalist and an economist.

14. Available from The American Presidency Project (1981).

15. In 2014 property taxes provided only 12% of the city’s revenues; fines and public safety another 14%, and sales taxes another 32%. The good news is that since the tragic shooting of Michael Brown, Ferguson has been forced to reallocate police department resources and this resulted in diminished traffic enforcement. In 2016 fines and public safety contributed only 6% of the city’s revenues (City of Ferguson 2017).

16. Human Rights Watch has a comprehensive report on this phenomenon, framed in terms of probation (Albin-Lackey 2014).