Political Mistakes and Policy Failures in International Relations by Andreas Kruck Kai Oppermann & Alexander Spencer

Author:Andreas Kruck, Kai Oppermann & Alexander Spencer
Language: eng
Format: epub
Publisher: Springer International Publishing, Cham

Conventional Risk Management

Modern fi nance has increasingly become aligned with the scientific ‘discourse of transcendental rationality’ (Thrift 1996: 13), the ‘rational language of probability’ (Power 2007: 124) and therefore profitability. Political economy and socio-economic relations are ‘refurbished’ through methods of statistical actuarialism—dubbed ‘machineries of knowledge’ (Knorr Cetina 1999: 5)—so as to be considered an objective account of (metaphysical) reality amenable to risk calculation (Lépinay 2011). This ontological bias and fetishisation of utilitarian risk calculus has facilitated the ‘development of a causal knowledge of deviance and normalization’ (O’Malley 1996: 189).Subsequently, both monetary and normative valuations may be assigned to financial instruments, services and government policy. Deploying such predictive positivism, asset managers satisfy client and regulatory demands for quantitatively sophisticated and defendable validation.

Underpinning this infrastructure of referentiality is a (false) dichotomy between qualitative uncertainty and quantitative risk. By treating the latter as an exogenous, self-evident phenomenon, expertise extends this positivistic bifurcation to the fields of (qualitative) ‘politics’ and (quantitative) ‘economics’. Idiosyncratic and unique political economies become re-encoded in accordance with self-systemic/self-regulating logics of neo-liberal capitalism (Hay 2004; Roy et al. 2007). The remote calculative capacity of risk’s predictive and prescriptive positivism provides a platform through which to discover capitalism’s supposed self-equilibrating mechanics. To help unearth these universal economic properties, methods common to the mathematical/physical sciences are borrowed and applied to socio-economic relations (Best 2008). Reinforcing the effect that uncertainty can be transformed into risk, this grants epistocratic leverage to the financial subjects qualified to perform such alchemy (Carruthers 2013). But rather than any absolute subversion of indeterminism, or the actual elimination of impediments that prevent the automatic correction of capitalist dynamics, this renders neo-liberal political economy a social fact (MacKenzie 2011). Unfortunately, its foundation is an artificial normality whose legitimacy is produced through distortive practices.

Increasingly, this constitution of authoritative knowledge becomes predicated on an arsenal of evermore sophisticated and techno-scientific (risk) modelling/methodology—accessible to only a few ‘quants’. Lépinay (2011) exp lores how these highly educated mathematicians and physicists—‘quants’—are routinely imported into corporate finance in order to help engineer this array of complex financial products. Their expert predictive positivism helps conceptualise and structure finance. Yet as the constitution of authoritative knowledge becomes more concentrated, high frequency and computer automated, this exposes us to the inefficiencies of monopolies and the shocks of their failures. Even more distressing is that the technical knowledge necessary to make the informed decisions and execute business strategies fundamental to mitigating imbalances from profit maximisation, regularly, eludes the owners of capital or executives in the C-suites. Consequently, this monopoly over epistocratic discretion has depoliticising effects—whereby qualitative, political judgement is marginalised and censured (Paudyn 2015). This renders wh at Foucault (1980: 81) refers to as ‘subjugated knowledges’, which ‘have been disqualified as inadequate to their task or insufficiently elaborated: naïve knowledges, located low down on the hierarchy, beneath the required level of cognition or scientificity’.

But rather than the complete elimination of discretionary conduct, there is a concerted effort to disguise it through quantitative techniques. Indicative of wh at Cochoy (2008) refers

Download

Copyright Disclaimer:
This site does not store any files on its server. We only index and link to content provided by other sites. Please contact the content providers to delete copyright contents if any and email us, we'll remove relevant links or contents immediately.