The Financial Crisis as an Expression of Macrohistorical Trends: World Hegemony, Neoliberal Globalization, and Financialization in 21st Century Capitalism

ion. Humans do not see the entire spectrum of light, only a small portion of it. We do not see microwaves, x rays and many others. Instead, our eyes evolved to block out those unnecessary waves for they are not germane to everyday existence. We do not think about all the light waves outside the spectrum, but our eyes are seemingly purposefully limited to maximize and focus cognitive power on the portion of the spectrum that matters most. The others are abstracted away. Once again, we do not think about this fact consistently; it simply happens. While that may work well in a normal setting, social theory and social research require a more rigorous and explicit formulation of how we abstract, even though many social theorists abstract without doing so explicitly. Abstraction refers to how we delimit the totality for further understanding. Good abstractors show the ways they do so. Thus, throughout the study I will explicitly limit certain boundaries or temporal and geographic scopes of analysis in each section. This allows for a more clear understanding of what aspects are being abstracted in each portion of the study. Put briefly, in this project my method of breaking down the causes and salient histories that led to the financial crisis consisted of (1) reading relevant literature31 and searching through the sources of that literature for further reading, (2) finding consistencies in the overarching lines of history that fed into the crisis, (3) dividing and synthesizing these histories into easily comprehensible subjector concept-specific areas, (4) explicitly formulating the temporal and spatial boundaries of each area – in other words, concretizing the level of generality, (5) analyzing those histories along such levels, and (6) adding the new levels back into the perspective as a whole, which enriches the overall depth of the analysis.32 31 Secondary sources were used along with more primary government data such as The Financial Crisis Inquiry Commission Report 2011. 32 For example, I start by analyzing the Arrighian long-term theory of systemic cycles of accumulation which is deemed to be relatively cogent. Then, drawing from other sources, I add a new hegemonic epoch to the previously theorized US world hegemony: neoliberal globalization. That leads into the need for understanding the hegemony of neoliberalism and globalization, which according to the Arrighian definition 148 A dialectical critical realist philosophy of science is the basis for good theory, especially good social theory (Benton and Craib 2010; Steinmetz 2005; Ollman 2003). Dialectical critical realism is a mixture of general critical realist philosophy that takes a dialectical or internal relations philosophy as an ontology/epistemology. It is highly compatible with Frankfurt School style critical theory and both mutually reinforce each other. This perspective views social relations as fundamental parts of existence and as fundamental parts of defining things as previously mentioned, but also adds in the critical realist ideas of emergence and multicausality. A critical realist theory of knowledge is “committed to the existence of a real world, which exists and acts independently of our knowledge or beliefs about it....” (Benton and Craib 2010:121). Concordant with Frankfurt School style critical theory, it “differs from empiricism in theorizing knowledge as a social process which involves variable ‘means of representation’” (Benton and Craib 2010:121). These variable means of representation require a “reflexivity about the conditions for a possibility for thought, or language, to represent something outside itself” (Benton and Craib 2010:121, emphasis in original). By subscribing to a dialectical conception of reality and reflexivity about representing an external reality through language, dialectical critical realism requires the use of dialectical concepts in an attempt to make reality and the representation of reality coincide more fully. Furthermore, the “critical realist(’s) insistence on the independent reality of the objects of our knowledge, and the necessity of work to overcome misleading appearances, implies that current beliefs will always be open to correction in the light of further cognitive work,” meaning that it coincides closely with the Frankfurt version of critical theory (Benton and Craib 2010:121). Critical realism puts positivist/anti-positivist debates almost to rest by moving them to a new level. Critical realism does this, in part, through the idea of emergence. Emergence refers to the fact that certain arenas of reality emerge from others. Take for example the act of speech. The ability to speak is based on our biology, psychology, and on physics, among other things. We could analyze our speech at the level of linguistics or psychology by of hegemony requires both consent through the creation of ideology and organizational/juridical changes. Those analyses lead into a further discussion of financialization, and so on.