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Agnotology

C-theory has some new articles under Theory Beyond The Codes. Michael Betancourt’s Immaterial Value and Scarcity in Digital Capitalism (link) describes financialization through the notion of semiotic capitalism. Find myself a bit skeptical overall of the argument, but I certainly enjoyed the term agnotologic capitalism and the section “Agnotology and Affectivity”:

While digital capitalism may appear to be an affective form of capitalism, and to a certain extent it does deploy affective measures to achieve its ends, a more correct designation is agnotologic capitalism: a capitalism systemically based on the production and maintenance of ignorance. [14] The accusations of fraud against banks such as Goldman Sachs for creating derivatives “designed to fail” and then claiming that these commodities are of the highest value demonstrates this process of misinformation designed to obfuscate, confuse and confound. This situation is partly a function of ideological blindness, and partly a reflection of the all-too-human desire to believe in positive scenarios such as the well known, but hypothetical, “free lunch.” Coupled with an affective performance, the agnotological dimension can only produce a social dynamic of misinformation.

This agnotism affects all participants within digital capitalism, precisely because it is the enabling factor for the perpetuation of the cycle of bubbles and the escalation of values they create. The limited horizons produced within this social network of agents and immaterial assets constrains the range of potential solutions to those that reinforce the established dynamic; this is the Ponzi formulation in action — as with the caucus-race in Alice in Wonderland, there is no alternative but to run faster simply to remain in place. It is this perverse dynamic that generates the need for affective remedial services. Juan Martin Prada’s affective capitalism is thus a symptom of the disassociation between the reality of capitalist economy and the alienation it produces:

Therefore, it seems to be almost evitable that the increasing computer automation of the productive and management processes in companies should only be able to generate the mere effects of closeness, affective simulations of service for the user, who will not cease to complain about the lack of contact with actual “flesh and blood” people when hiring services, solving doubts or presenting complaints. [15]

The affective labor created to address this alienation is part of the mechanisms where the agnotological order maintains its grip on the social: managing the emotional states of the consumers, who also serve as the labor reserve, is a necessary precondition for the effective management of the quality and range of information. The creation of systemic unknowns where any potential “fact” is always already countered by an alternative of apparently equal weight and value renders engagement with the conditions of reality — the very situations affective labor seeks to assuage — contentious and a source of confusion, reflected by the inability of participants in bubbles to be aware of the immanent collapse until after it has happened. The biopolitical paradigm of distraction, what Prada calls “life to enjoy,” can only be maintained if the underlying strictures remain hidden from view. If affective labor works to reduce alienation, agnotology works to eliminate the potential for dissent. This elision is essential.

Creating values through the production of immaterial values that are constructed around a fictitious basis in tangible assets (there are more derivative assets than can be matched to physical commodities) requires that the valorizing process apparent in the semiosis remain unacknowledged. The biopolitical paradigm of distraction serves this semiosis by keeping the social agents occupied in affective pursuits and fantasies of economic advancement (home ownership as “the American Dream” being the lure for the “Housing Bubble”). Without these tangential considerations distracting the human resource, the valorization process would be impeded as the concept of production is extended to all parts of the social domain, and subsequently deployed in the escalation of values inherent in the financialization process.

Can fit into many situations - consumer marketing and mass advertising come to mind. Disinformation especially with regards to the perception of opinion gleaned from internet but at any functional level can facilitate a self propaganda where a frank lack of knowledge might have otherwise been recognized. Organizational dynamics and groupthink-type effects and biases can be procyclically reinforced by their nature. 

Specifically, however, asymmetric information tends to be less often mentioned in the context of credit ratings agencies, other agents in the securitization process, or in counterparty risk considerations. Procyclical calibration of credit enhancement or counterparty credit risk exposure opens up many sites for potential arbitrage and financial misdealing (below).

A consideration of Foucault’s concept of governmentiality could be substituted or, with a stretch, realist considerations of geopolitical anarchy. The recent SEC settlement on the Abacus deal - as referenced - along with the probe into motivations behind the SEC’s initial timing are, however, telling.