Tag Archives: social cost of economics

Sacrifice and the crypto-theologies of management

Sacrifice and management are not words that one expects to hear in the same sentence. But – as those who read my earlier post will know – I’ve been reading theology in my spare time, so when Marcia Pally invited me to talk on sacrifice and the economic world at an interdisciplinary workshop I was happy to accept. Here’s an expanded version of my Huberlin-logo.svgcontribution to Marcia’s workshop ‘Sacrifice: Biological and theological investigations for economic and military/political praxis’, held at Humbolt University, Berlin, 16-17 June 2016 funded by the Fritz Thyssen Foundation and the Theology Faculty of Humboldt University-Berlin. Many thanks to both funders and to Marcia for her kind invitation. This piece was first published on the Telos website.

“Sacrifice, or at least the discourse of sacrifice, is a recognizable aspect of popular management discourse and management scholarship of the ‘post-bureaucratic’ variety, especially popular in America from the 1980s to the 2000s (Child, 2005; Peters, 1992; Peters & Waterman, 1982). The absence of bureaucratic structures of command necessitates other forms of authority, and notions of sacrifice form part of the symbolic armoury of the post-bureaucratic chief executive – though, of course, post-bureaucracy is itself a symbolic myth more than a practical solution (du Gay, 2000). In this talk I will set out some aspects and suggest, playfully, that there are crypto-theologies at work in management discourse and scholarship; I will finish by connecting these to the sacrifice and excess inherent in neoliberal forms of organisation.

So let me start with two exemplars. The first is American businessman Lee Iacocca, Iacoccacelebrated for his self-sacrifice in saving the struggling automotive giant Chrysler for a salary of $1 a year. Certainly, Chrysler received government bailout – some $1.5bn in loan guarantees and huge military orders of trucks, but Iacocca put the company’s turnaround to his own sacrifice, and its inspirational effects on those around him. The second is Mark Zuckerberg, who has committed to give away 99% of his holding in Facebook stock – worth $45bn dollars, in his lifetime. What is interesting from the perspective of sacrifice is his decision to do so through the legal form of a limited liability corporation, and I’ll return to this point later on.

Both of these are very high profiles of management sacrifice; both are accompanied by other, less newsworthy, everyday sacrifices – the jobs lost in Chrysler’s reorganization, or Facebook’s value built on the unpaid contributions of millions (billions?) of users (Scholtz, 2013). This kind of discourse speaks to a very specific notion of sacrifice – one that is calculative, strategic, and self-aware. It is part of the armoury of the charismatic or transformational leaders vaunted in management literatures: typical findings include that self-sacrifice leads to the attribution of charisma, the establishment of legitimacy the encouragement of follower reciprocity, an increase in organizational commitment and team efficiency and a decrease in perceived autocracy (Śliwa, Spoelstra, Sørensen, & Land, 2013). Continue reading

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The problem with economics, again

A very happy New Year to all – to celebrate, here’s something from the archives. I wrote this for the LSE Politics and Policy blog in the spring of 2014, just after my book had been published. It circulated for a while, and popped up again at the end of the year as one of the blog’s ten most interesting reads from 2014. I’ve seen it on twitter a couple of times since. It hasn’t gone out of date: the year of horrors that was 2015 threw up so many issues about which economics would have something to say, notably the crises over European debt and migration. With typical humility and understatement I chose the title ‘The problem with economics’. So, without further ado, here it is once again:

‘In my recent book, I Spend Therefore I Am, I claim that economics is itself one of the biggest problems we face today. By economics, I don’t just mean something that happens in universities, but a way of thinking based on and institutionalizing certain assumptions: that we are driven primarily by self-interest, organised by competition, and governed by the calculation of future returns over costs. I argue that the logic of the market has even become embedded in our daily, personal interactions. And I suggest that, as the real challenges for our future – such as the distribution of wealth, global welfare and climate change – cannot be usefully discussed, let alone settled, in those terms, economics itself is in need of some attention.

Judging by some of the reviews, I have ruffled a few feathers. I have been accused, even by the more benevolent, of doing economics a disservice, setting it up as a straw man to be knocked down. In one sense this is true. In the UK, at least, university departments of economics are heterodox, interesting places, housing scholars of all hues: Marxist economists, development economists, and labour economists who work happily alongside behavioural economists and financial econometricians. I freely admit this but it’s what happens outside universities that matters, and the diaspora of one particular kind of economic thought, that represented in economic textbooks, PPE degrees, and the business case justification, is almost universal.

Universal it may be, but fit for purpose it is not. It crowds out other values and leads conversation into a cul-de-sac of squabbles over calculation. In February, a major healthcare institute hit the headlines with the suggestion that statins (anti-cholesterol drugs) should be prescribed to the majority of men over 50 and women over 60, on the grounds that it is more cost-effective to flood the nation with drugs than deal with a tsunami of heart-related health care issues. This may be true but it obscures some more pressing questions: should we eat less, eat better, spend more time out of the office, and be subjected to less stress? Is there something fundamentally wrong with the organization of our society of which heart disease is just a side-effect?

The economist’s answer is that we just need better (read more complex) models. But ceding authority to models rob us of the ability to talk about what we should do, or even to recognize that the best we can do is far from good enough. If we object to contested and complex models sitting as unelected legislators in our parliament, then more sophisticated models will simply worsen the situation: more sophistication equals less transparency and less opportunity for the lay-citizen to contest the models’ judgement.

This kind of economics is ever present in our public discourse. It appears when we ask what we should do about higher education or the flooding in the South West. Government officials charged with looking after culture are obsessed by the Treasury’s Green Book and preoccupied by the thought of market failure. The way that we talk tells us what counts and what does not and helps us assign value to certain things. But talk alone is not enough to ensure the dominance of economics in our public and private lives. For that we need economic things: models, tools and organizational architectures. It’s not a metaphorical ploy to suggest that economic artefacts are active legislators in the world around us. The complexities of arriving at a decision in the modern world force us to share the burden of calculation with devices, which become, in the words of the French sociologist Michel Callon, ‘prostheses’ for economic action. These things do. They act in the world and our agency is shared out amongst them.

So, for example, when one adopts the methods of the Green Book, or switches on an investment bank trading screen, one takes up calculative tools in which certain economic assumptions are embedded. The discounted cash flow, central to business case analysis, produces in the world a very particular set of effects with its roots in economic theory – the diminishing value of money (and sometimes persons) in the future. Philosophers may be less than happy with its assumptions (how can one discount a life?) but every day in offices and trading rooms around the globe, the discounted cash flow really does make the world into a place where the future is worth less than the present.

Often, economic devices are naturalised such that we often don’t notice their effects. Let me offer another example. My colleague Shiona Chillas and I have spent some time investigating the mechanics of online dating sites. We have been able to trace the progress of particular economic ideas and methodologies into the construction of dating algorithms and interfaces. When a user enters the site, they form a temporary partnership with the machinery and act in a certain way, to maximise return on their own value. Our findings align neatly with the substantial body of research on the tactics of users on the sites: they become economic, they shop, they maximise dynamic preferences. Some sites analyse previous searches and show you matches according to your ‘revealed preference’. The machine knows you better than you know yourself, so long as you choose a partner as you might a pair of trousers. Under these conditions, it’s impossible to maintain the fiction that a user’s choices are not shaped by the site’s mechanics, when the machinery does so much of the work. Nor is it much of a defence to claim that the school disco was also instrumental. It may have been, but the cybernetic rationality of online dating is something else altogether. We don’t know for sure how much of this cyborg dater spills into the world around us, but I suggest that the prognosis is not benign.

Many will agree that our economized public discourse is lacking. But examples like online dating, healthcare, and the grimy world of Punternet (an online review site for sex workers, promising that better information will lead to ‘less stressful, more enjoyable and mutually respectful visits’) encourage me to push the argument a little bit further. Economic rationality is powerful, and in its thoroughgoing solipsism it drives out other virtues: if we must only care about ourselves, how can we possibly care about others? When we reduce our interpersonal relations to calculations of cost and benefit, disciplined by competition and mediated by the manifold devices of economics in the world – the same discipline that we must focus upon ourselves – then we run the risk of losing something far more precious: our humanity.’

Happy New Year to you all. I hope 2016 brings us all good things.

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New Books in Critical Theory: podcast

Some weeks ago my friend and colleague Dr Dave O’Brien interviewed me for a podcast on his New Books in Critical Theory series. I’m delighted to be in such eminent company (not to mention being called a critical theorist) – recent podcasts from William Davies on the happiness industry and Liz McFall on the insurance and credit markets, not to mention the splendid Swedes Isabelle, C-F, and Francis, talking about their recent edited volume on value practices in life sciences (which I’m in!). Listen to them all. So without further ado, here’s the link to the podcast. Thanks Dave!

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Does economics leave room for love?

Back in August I recorded an interview for Talking Books on newstalkfm. Susan Cahill, whose show it is, had really got her teeth into my book and asked me all sorts of difficult questions. Why had I used Borges’s fable as a metaphor for economics – no one has ever asked me that before, although fortunately I did have good reasons! So I had to think on my feet a few times, but I think it’s a great interview, all the better for hearing an author really challenged once or twice. And from my point of view, there’s nothing more flattering than having someone take real interest in what you’ve written; that’s true any time, but even better when others can listen to it on the radio. Thanks Susan! The interview was broadcast on 4 October 2015 and you can listen to it here.

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Pally, Roscoe and Felber in Cologne – session video

I’ve already published my lecture ‘Reorganizing Growth‘ from the conference ‘Ihr aber glaubet’ (Cologne, 12-14 June, funded by the German Federal Cultural Foundation). Now video from the whole session is available – in high quality too! – so I’m making it available here. First up is Marcia Pally, who urges us to be willing to learn lessons from two millennia of theological thought. Though we may not embrace the sacred worldview any longer, the problems that taxed the medieval thinkers are not so different from those that perplex us. My talk is next (from 33 minutes to 1hour 9 minutes on the extract). I’m followed by the lively Christian Felber, who believes that change can happen and offers us some good ways of thinking about how that might happen. Finally, there’s one of those strange chairs on the podium debates, moderated by Wolfram Eilenberger (editor-in-chief, Philosophy Magazine).

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‘The True Cost of Economics’ at the RSA

On 13 February 2014 I had the honour of giving a lecture at the RSA (Royal Society of Arts) in London on ‘The True Cost of Economics’. You can find audio podcasts, including the Q&A, and downloadable video on the RSA’s website.

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