I've had an article accepted by Theory Culture & Society, entitled 'When is a market not a market?: 'Exemption', 'externality' and 'exception' in the case of European State Aid rules', which I've now uploaded a pre-print version of. This paper was originally something I prepared for a seminar last summer, as part of the Rising Powers network I took part in (and also wrote this paper [pdf] for).
The paper attempts to identify the various logics and justifications through which neoliberalism delineates the limits of the market, or rather, the limits of certain market-based forms of economic reasoning. Clearly, the assumption that any society allows markets or economic logic to determine everything is falsified by simply walking down the street or reading the newspaper. So the question (as posed by Karl Polanyi) is where and how to draw the line around market principles and values; Keynes famously said that this was what Hayek had no capacity to do, but pragmatically speaking, states do manage it. One way that these limits are codified is in EU State Aid rules, which is why I thought that would be an interesting empirical place to look.
I guess the contemporary pertinence of this paper, if there is any at all, is in how I've attempted to theorise the current condition of (European) neoliberalism as existing in a state of exception, in which market norms and techniques are constantly dependent on necessary forms of executive intervention for their survival. Hence, neoliberalism lives on, but only on the condition that it is in a possibly long-term state of emergency. This can be shown empirically via the shifting emphasis of the Commission, away from a logic of 'market failure' as a justification for state intervention, towards a logic of necessity, at least for a period of time.
Here are some of the paper's conclusions:
How long does this state of exception last and how far does it extend? One criterion by which Aid to banks would be considered compatible with State Aid rules was that it be reviewed at least every six months (EC, 2008b). In December 2008, the Commission announced a new ‘Temporary framework’ authorising necessary rescue packages in the ‘real economy’ (i.e. non-financial firms), such as loans and guarantees that the financial sector was itself unable to offer (EC, 2008c). This framework expired on 31st December 2010, and subsequent communications were issued to provide guidance on the phasing out of Aid to financial institutions (EC, 2010). Statements made by the Commission therefore indicate a desire to terminate the formally recognised exception to market-based principles and techniques of valuation. But this doesn’t mean that these principles and techniques are now restored to the status of state-endorsed norms. On the contrary, the exception does not need to be legally validated or recognised to persist; that is its definition. From a Schmittian perspective, the legality of sovereign rule always tacitly allows for non-legal acts. But moments of rupture and publicly declared states of exception create the possibility of permanently exceptional states, in which executive political power acquires the legal right to act purely out of necessity, and without justification. Whether or not the European Commission recognises this as an accurate depiction of European neoliberalism post-2008, this may be what has emerged.
There is an inherent conflict in the relationship between economics and sovereignty, as explored by Foucault, which shapes the unwieldy character of the neoliberal state. The Euro crisis of 2010 can be seen as a consequence of this, in which a transnational market logic was created in place of national sovereignty, but without any political sovereignty of its own. As Peck argues, “neo-liberalism’s curse has been that it can live neither with, nor without, the state” (Peck, 2008: 39). The European monetary crisis is serving up new attempted solutions to this contradiction. The appointment of economists as unelected Prime Ministers of Greece and Italy in 2011 takes the attempted synthesis of economics and sovereign power to unprecedented heights, and casts a thoroughly more Hobbesian light upon the possible ‘performativity’ of economics. Meanwhile, whatever imbalances of European national power may once have been concealed by the liberal rhetoric of a post-national European project, are now naked as the survival of the single currency becomes predicated upon the obedience of southern European citizens to the demands of German and French national leaders. In its apparent state of exception, the European project is one of discretion and political decision, as much as one of judicial rule...
In the years that have followed the rescue of European banks, a number of scholars have questioned whether neoliberalism is alive or dead, or in some type of ‘zombie’ state (Harman, 2009; Peck et al. 2010). The unfolding of the European sovereign debt crisis over the course of 2010 and 2011 has forced constant decisions and dilemmas upon state actors, who face repeatedly unprecedented situations in which the ‘normal’ market order faces an existential threat. Senior politicians and senior bankers now negotiate face to face, to try and identify shared interests. In answer to the question of whether neoliberalism is alive or dead, it seems entirely plausible to speak of an on-going or permanent state of neoliberal exception. Agamben identifies one case of exception in the Roman institution of iustitium, in which law would go on ‘holiday’ while the republic fought for its survival. Iustitium is neither legal nor illegal; in fact it is not a legal category at all, but a juridical vacuum. The present actions of European states and European Commission are perhaps neither compatible with market-based principles and techniques of valuation, nor contrary to them, but operating in a market vacuum.
Anyway, that's quite enough. It's a paper I feel quite proud of, as it knits together a number of theoretical and empirical interests of mine of the last few years, and hopefully casts some light on the present. Any thoughts very welcome. I can't say when it will appear in print.