- * Article published in RCCS 101 (September 2013).
1Talking about financialization these days is the same as talking about the dominant face of contemporary capitalism. Let us accept, as a general definition, that the concept of financialization stands for the steady growth of financial markets, players, institutions and motives as protagonists in the world economy (Epstein, 2005: 3). Most approaches to financialization tend to be of a macroeconomic nature. In our minds the colonization of the economy by finance is intimately associated with its occurrence on a global scale, which in turn redirects one’s analysis to the structural conditions leading to the wide reach of today’s increasingly financialized capitalism: the major trends and forces of globalization; bloc-based or area-based policies; or yet the actions of political or corporate entities, both national and supranational. But we know, since Max Weber, that capitalism entails the existence of a spirit – in sociological terminology, a subjectivity. In fact, in the context of financialization this particular facet is less palpable and harder to pin down, although no less important. Financialized capitalism at once requires and fosters a way of seeing and doing, a way of perceiving and interpreting the world, and also a form of personal self-perception which can be traced to a human archetype of behavioral and emotional management, which in turn both produces and is produced by financialized capitalism itself.
2The present article addresses this subjectivity, its principal aim being to critically analyze the discourse created by one of the tools used for conveying and constructing subjectivity: financial self-help literature (FSHL). The analysis a) uses, as empirical material, publications of this genre available on the Portuguese market; and b) is based on the theoretical approach of governmentality studies inspired by Foucault. It brings to the fore the importance of a mode of subjectivity that is consonant with the requirements of financialized capitalism (Papalini, 2013) and functionally capable of maintaining and reproducing it.
3The article’s first section reviews the concept of financialization, identifying its theoretical and empirical strengths and weaknesses. One such weakness is the lack of attention paid to micro-sociological aspects, and this justifies the need to explore, in the second section, the type of subjectivity related to financialized capitalism. The third section examines the key aspects of this subjectivity as presented in FSHL, including a framework for the characteristics of these publications and a study of the motives for, as well as the objectives and ways of, putting self-help advice into practice. The final section focuses on the social basis of the texts as discursive tools of neoliberal political rationality – where neoliberalism, as mentioned above, is understood in terms of the neo-Foucauldian take on governmentality.
4Financialization is a recent word, which means that we are still a long way from a plain definition or a consensus about its constitutive elements. However, we can list those aspects that are regarded as consolidated in the literature, and about which there is some consensus at this point:
Generally speaking, the concept amounts to saying that the capital that circulates in the financial channels outweighs capital flowing through the channels of the productive economy. Such predominance is the outcome of a historical process that marked a shift from a Fordist production to a post-Fordist financial system (Heilbron, 2005; Epstein, 2005).
This predominance also means that the balance between financial markets, on the one hand, and business and industrial corporations, on the other, has shifted in favor of the former, thus causing long-term pressure of dividends on industrial policy (Langley, 2007).
Financial activity is highly capable of generating new assets as well as indexing systems that can serve as collateral (Leyshon and Thrift, 2007).
On a global scale, the economy takes a back seat to finance, whose structural and logistical foundations are information technologies and the process of economic globalization (Martínez González-Tablas, 2012; Santos Ruesga, 2012).
5We are thus faced with qualitative and quantitative changes in financial activities. In this context, there is a relatively homogeneous set of manifestations and consequences linked to the development of financialized capitalism (Medialdea García Sanabria and Martin, 2013): the increased complexity of the foreign exchange market, the privatization of formerly public companies and services, the independence of central banks vis-à-vis governments, the many varieties of credit extension, the use of employment as an adjustment variable, or the growing instability of financial markets.
6In short, the study of financialization comprises a number of fairly constant characteristics, to wit:
It often provides macro-sociological approaches where the role played by governments, the state, and corporations is given explanatory precedence.
It is cast as a process that can force itself on individuals, who are relegated to a passive role as mere recipients of the actions of financial capitalism.
It is typically defined from an economic standpoint and, therefore, through variables whose analysis plainly belongs in the realm of economics.
7Structurally this phenomenon has been thoroughly identified, which is actually one of its strengths. But that strength is also a weakness, in that the analytical efforts have mostly targeted the abovementioned macro-sociological aspects, with virtually no studies devoted to its workings in everyday life and in people’s immediate experience. The notion of “democratization of finance” erupted on the scene as an attempt to fill this void. The phrase alludes, on the one hand, to the growing number of middle- to low-income earners participating in the financial markets as well as the level of such participation, and on the other hand to the whole range of incentives in place for purchasing financial products in order to satisfy housing, health, educational or retirement needs (Erturk et al., 2007). In addition to its descriptive meaning, the democratization of finance has a markedly normative side, especially when viewed as the desired product of an increasingly market-oriented society. A case in point is Robert Shiller, the recent Nobel laureate in economics, who advocates the notion that a comprehensive variety of financial products should be developed to meet the needs of a vast number of customers. In other words, the democratization of finance is viewed as an extension of financial markets, an alluring gate of access to basic goods and services, for it generates a social order where free individual choice is the prevailing principle (Shiller, 2007). The most visible manifestation of this normative reading can be found in the financial education programs that are being or have been implemented pretty much everywhere. Countries like the United States, the United Kingdom or Australia have pioneered this field, while Portugal has had its own National Plan for Financial Education since 2011 (CNSF, 2011). In general, this type of program seeks to improve people’s financial literacy, both quantitatively and qualitatively, while increasing their ability to choose among different products. So ultimately it is the customer who monitors the market and forces institutions to adjust supply according to the needs of well-informed consumers (Bay et al., 2012).
8As far as the descriptive version of the democratization of finance is concerned, it is safe to say that the pervasive penetration of the financial world in everyday life and the shaping of individual and family everyday practices are widely acknowledged realities these days (Martin, 2002; Erturk et al., 2005). This pervasiveness is also felt in the sphere of work and wage relations (Alonso and Fernández Rodríguez, 2012), as well as in the media, where financial issues are often presented within the framework of spectacle and entertainment (Harrington, 2008; Clark, Thrift and Tickett, 2004). Thus, this alternative approach to finance as something that is an integral part of everyday practices focuses on micro-sociological aspects, allowing us a first glimpse of what might be the mode of subjectivity associated with such practices.
9As mentioned above, financial capitalism has a spirit of its own, linked to a way of thinking and of representing the world and to a set of patterns of emotional and behavioral regulation that interact with practices on a permanent basis. In this connection, there are studies that analyze the use of board games – such as the famous “Cashflow,” based on Robert Kiyosaky’s bestselling Rich Dad Poor Dad – as an educational tool for developing not only financial skills but also life skills, i.e., a tool for acquiring an all-round personality (Fridman, 2010). Other types of study address the mental and cultural aspects of the development of personal finance policies (Aitken, 2007), or the prototypical mindsets of investors as a function of historical context (Preda, 2005). This is a line of research shared by the present paper, which seeks to underscore a few major points:
Building a subjectivity that befits the financialization process is crucial if the process is to be reproduced and maintained. Thus the process helps develop a certain type of subjectivity while being fostered by it.
This subjectivity is not strictly the result of disciplinary action aimed at breaking the individual’s will or resistance. From a Foucauldian point of view, it is rather the product of various arrangements in technologies of government, namely the discourses of experts, the regulations in place, and even the different ways in which individuals choose to implement technologies of self-government (Miller and Rose, 1990).
In order to understand the subjective aspects of financialization it is imperative that we put aside all notions of power as a unilateral imposition emanating from some central entity. A relational concept of power is adopted here instead, coming from multiple sources – state, corporate, business, etc. – and using personal autonomy as a fact upon which the exercise of government is based. In this context, each and every configuration of subjectivity is predicted on the notion of the autonomous individual. It is therefore easy, in an undertaking like the National Plan for Financial Education, to link its provenance and intentionality to formal government bodies and agencies, but in the case of self-help writings such identification is a lot less simple. As we shall see, however, such writings are relevant tools for constructing this financialized subjectivity. We are talking about authors with no professional or partisan connections with the state apparatus, who resort to the world of publishing to offer a specific product for solving issues – such as, among others, debt, consumption, saving and uncertainty – previously identified as problematic.
The seeming banality of financial self-help literature as a tool for constructing subjectivities has to be deconstructed. Ultimately this is a way of foregrounding discourse so as to analyze the concepts, explanations and motives being used to legitimize a given model of conduct and emotionality. Besides and beyond the relationship between language and politics – a relationship that tends to oscillate between homology and ideology – we need an approach based on a dynamic understanding of the relationship between power and knowledge. Hence the Foucauldian angle, with its emphasis on the need to know an object – in the case of FSHL, the Self, one’s personality or inner being – in order to govern it: the object will only become governable when it is turned into a knowable, quantifiable and manageable entity, with its inherent traits and limits. It follows that the study of financialized subjectivity cannot do without a scrutiny of the discourses that shape this subjectivity.
10Bearing in mind the above guiding principles, we now proceed to explore its configurations as presented in financial self-help texts. To put it succinctly, there is the question of why one should be financially literate, what it means to be financially literate, and how to be literate in technical, vital and behavioral terms.
- 1 The best and most comprehensive characterization of the genre is to be found in Papalini (2008). Fo (...)
11We may start out by defining FSHL as a subtype of self-help literature. It creates reflexive programs for behavioral and emotional control, intended to improve one’s psychological mindset and adaptation to the social environment. Such programs establish a frame of reference to guide behavior and affect, facilitating an individual’s full inclusion in the specific behavioral patterns of his or her social milieu. By and large, self-help literature as a genre addresses the person’s subjective side, and that is the point of departure for the kind of life change that is perceived as satisfactory. Thus self-help resorts to a variety of rhetorical devices, the most common being: a) the use of the second person singular pronoun or of the inclusive “we”; b) the repetitive insistence on a few main points; c) illustration with real life situations and personal accounts; d) interactive, test-based diagnosis; and e) the portraying of readers as endowed with the ability to change their behavioral and emotional conditions. The expository structure usually starts by typifying the problem or situation requiring change, and then proceeds to apply the remedies and solutions prescribed by the legitimizing discourse on which they are grounded.1 Still, the genre’s boundaries are not impermeable, which explains the existence of a somewhat gray area where we find publications that, while not including the whole gamut of paradigmatic features of self-help literature, partake of certain of its elements and show a number of similarities. These include novels, biographies, memoirs, as well as writings on Eastern thought, alternative medicines and body control.
12Personal finance is but one of the topics commonly covered by self-help literature. Samuel Smiles’ seminal Self-Help, first published in 1875, not only coined the phrase but also contained early allusions to savings. The book offered mostly advice to small investors, whose modest capitalist ventures were regarded as those that truly foster civilization and development (Smiles, 1908 : 341-368). Other classics of the genre, such as Dale Carnegie’s How to Win Friends and Influence People (1936), or Orison Sweet Marden’s Be Good to Yourself (1910), also offer self-help content that would later be included in other manuals, drawing parallels between personal psychological growth and the business-oriented mind. The visibility of these manuals increased during the decades of European developmentalism, with issues like corporate management, administration, human resources and emotional management also being addressed (Ampudia de Haro, 2010, 2011).
13This visibility is no less felt today. The economic and financial crisis which broke out in 2008 and the austerity policies that followed have produced a social framework in which the whole issue of personal finance rose to new prominence. Whether real or induced, this prominence is actually linked to a public discourse that sees bankruptcy as the single major threat to the social order (Ampudia de Haro, 2014). This context has presented the publishing industry with a window of opportunity, generating a proliferation of publications that offer individualized solutions for financial problems as a way of effecting personal change. Bookstores, airports, shopping malls and highway service areas are the preferred ‘habitat’ of these publications. In addition to the genre’s customary conventions, today’s financial self-help writings present the following specific traits:
The reflexive splitting of the individual as both subject and object of outside help applies primarily to economic and financial matters, and more specifically to household budgeting and to savings and investment planning.
These are not technical manuals, nor are they guides for disseminating economic knowledge. The financial content is indissociable from their wider intent with regard to the behavioral and emotional change that the financial moves are supposed to effect. Generally speaking, financial self-help literature is not only a source of knowledge, but also, and above all, a source of personal change.
Their reason to exist, according to their authors, lies in the fact that they are tools for dealing with the crisis. This categorization is also the reason why these writings tend to address the country’s economic situation, thereby somehow justifying the need to turn to financial self-help.
The authors’ self-legitimation is affirmed either by their status as finance experts or by their professional experience as specialists or journalists in the field of economics.
These writings involve a twofold dialectic: on one hand they clearly seek to inculcate a model of financial self-regulation – and therein lies their potential for creating something new – but on the other hand they exemplify and speak for those pre-existing models of self-regulation, which gives them the ability to reflect current behavioral patterns.
14Selections are always arbitrary. I am not including a number of books that happen to exhibit the same characteristics as the ones analyzed here. Therefore the authors and titles under analysis could well not be the ones mentioned below, but the type of discourse would not be significantly different. My list does not follow a logic of probabilistic representativeness, as it does not attempt to reproduce the target universe under analysis, i.e., all financial self-help books available on the market. Structural representativeness is what is aimed at here instead. In other words, an analysis is offered of the most significant discourses produced by FSHL, or the most common whenever the issue of personal finance is addressed (Ibáñez, 1985). Once the basics of this type of discourse are outlined, we will be in a position to critically analyze the subjectivity model we have before us, and to begin to interpret it theoretically.
15The analysis is based on the following books:
Como salvar a minha reforma [How to save my pension] (2011), by David Almas and Joaquim Madrinha. This book, by two economics journalists with degrees in finance and e-business, addresses the topic of personal finance in the context of the social security system crisis – which supposedly is reason enough, or so the authors argue, for people to opt for private pension savings plans in order to ensure their means of sustenance upon retirement. According to the “Management Books” ranking published in Diário Económico, a Portuguese newspaper, it remained among the ten best selling books in the period April-June 2011.
Seja mais esperto do que a crise [Outsmart the crisis] (2009), by Luís Ferreira Lopes. With a long career in journalism, namely in the area of economics, the author is the current economics editor for SIC Notícias TV channel. Moreover, the book includes a prologue by Marcelo Rebelo de Sousa, a law professor and well-known political commentator, arguing for its relevance in the present context. The main focus is on everyday saving practices, the small daily gestures that allow for significant gains in the long haul.
O seu primeiro milhão. Como poupar e fazer crescer o seu dinheiro [Your first million. How to save your money and make it grow] (2013), by Pedro Carrilho Queiroga. An “anti-crisis” publication is how the cover announces this book by the founder of Kash Finanças Pessoais [Kash Personal Finance], a pioneering company in the field of financial education in Portugal. With a title that is both commercially appealing and conventional in terms of self-help literature, it explores the relationship between savings and investment, viewing them as two sides of the same coin and at the service of one single purpose: life change.
Como esticar o salário e encurtar o mês [How to stretch your paycheck and shorten your month] (2009), by Camilo Lourenço. This is another case of a journalist specializing in economics and finance. Much of what is in this book was first aired on such radio and TV programs as “Moneybox” or “A cor do dinheiro” [The Color of Money]. Again, a wide range of suggestions and advice are offered on how to save on a daily basis and, to a lesser extent, on how to turn those savings into future income through investment.
O que os ricos sabem e não contam. Manual de finanças para mudar a sua vida [What the rich know and will not tell you. A finance manual to change your life] (2008), by Aitor Zárate. An expert in international taxation and the Chicago futures market, the author offers a digest of his personal knowledge about investment and savings as a method for changing one’s life. Instead of the more traditional, expository style used by the abovementioned authors, Zárate adopts a narrative, dialogue-based format delivered by two main characters: Roberto, who has a personal method for getting rich, and José, a student who wants to know about the method. The book is a perfect example of the transnational, transtextual and transcommercial nature of FSHL. It was originally published in Spanish and has gone through seven editions in Spain alone. The original title – Cambio de vida. Cómo me hice rico [Changing one’s life. How I became rich] – was not used in the Portuguese translation, as the publisher opted for an adaptation of Brian Sher’s 2001 classic What Rich People Know and Desperately Want to Keep a Secret, using the cover of the Brazilian edition.
Vacas magras, porcos gordos. Manual de boas práticas para conservar e fazer crescer o seu dinheiro [Lean cows, fat pigs. A manual of good practices to save your money and make it grow] (2011), by José Manuel Ribeiro Malarmey. An introduction by the CEO of Liberty Insurance Portugal claims the book should be a must read in this country of “cicadas and ants.” The main emphasis is on the question of everyday savings and how it relates to investment as a way of ensuring future financial security.
16FSHL discourse begins with a description of the social context that is the reason for the discourse to exist in the first place, providing a general explanation of the factors underlying the Portuguese crisis. The factors in question are basically two: consumerism and debt. They are interconnected, and have an individual as well as a national dimension. If on the one hand the shortcomings, or cognitive-ethical deficiencies, of the Portuguese with regard to consumption and credit can be ascribed to specific individuals, on the other hand when such specific behavior becomes pervasive, the result is an over-indebted country. Therefore the sum of the parts – which is to say, all this financially uncontrolled individual behavior – is exactly equal to the whole, and it spells a nation in distress.
17Let us start with the ethical shortcomings. “For 500 years, since the Discoveries, the Portuguese have lived beyond their means” (Lopes, 2009: 74). Portugal, it is said, has developed anomalous standards of ostentation, displaying goods and patterns of conduct that belie its actual material circumstances. In the past, there were the ships loaded with spices to mask the taste of foods, the “tacky exhibitionism” (ibidem: 73) decried by Eça de Queiroz, or the opportunistic land developers of the post-1974 period. With the arrival of the euro, the country kept pursuing those standards of ostentation, embracing the “debt craze at a time when interest rates were at a historic low” (ibidem). Here's your “Homus (sic) Lusitanus,” with his “delusions of grandeur, especially on the part of the middle- and lower-middle classes” (ibidem: 123). Homo Lusitanus then comes alive as an ideal type the reader can easily relate to: “the typical Santos family” (ibidem). The Santos, a perfect illustration of the average middle-class Portuguese family, lives in a cycle of consumption, credit and debt:
The couple is paying off two car loans, plus the monthly payments on the house. Next they took out a loan to buy a new TV set [...]. Then the children would not stop asking for a PlayStation or a Wii. The kitchen received the new dishwasher and washing machine, in addition to the fridge-freezer combo. Oh, I almost forgot to mention those overseas holidays. And all this at an interest rate I will not even go into now. (ibidem: 128)
18The guiding metaphor to describe this phenomenon is that of the cicada and the ant. It illustrates “the roots of the self-inflicted problems we are facing today” (Ribeiro, 2011: 10), problems arising from “the delusions of easily available credit” (Lopes, 2009: 20), or from the shopping mania when the country went from a culture of traditional saving to a culture of consumption (Lourenço, 2009: 40). The embodiment of traditional culture is Senhor Manuel,
[...] who lives down the street from us, only buys and consumes the things he needs and has serious saving habits [...], he does not wear designer clothes nor does he own a cutting-edge mobile phone; not to mention that car he drives around in, or the shoemaker who mends his shoes. (Ribeiro, 2011: 17)
19In a word, the lure of consumption has pushed financial recklessness to a considerable level, and caused a lack of long-term foresight and unwillingness to put off gratification (Carrilho, 2013: 40), thus giving rise to collective financial irresponsibility.
20Alongside the ethical deficiencies there are the cognitive shortcomings, which also help explain this irresponsibility. The latter have to do with the fact that the Portuguese have poor financial literacy skills and insufficient knowledge about money in general.
21Another typical illustration would be Senhora Maria, described by Camilo Lourenço. She applies for a loan to pay for a new car upfront. She knows that the monthly installments total 300 euros, but only later does she find out that the interest is 17%, and that canceling after signing the loan documents carries penalties: “What does Senhora Maria’s case tell us? The average Portuguese is lacking in financial literacy: people do not budget, and so they fail to estimate the impact of their decisions in the medium and long term, their sole concern being to have access to certain goods or services” (Lourenço, 2009: 44). The remedy for financial illiteracy is financial education. Its goal is to adequately understand money – in other words, “to make sure that such lack of awareness and lack of respect for money and its inherent value is not perpetuated in future generations” (Ribeiro, 2011: 12). Thus, once the shortcomings are identified, a process is set in motion whereby people try to “help themselves” financially: they then start to learn financial responsibility, embarking on what is also a path of personal transformation.
22As with any other exercise in self-help, in this case “helping oneself” involves the issues every person has to address, so it is not just a matter of knowing the state of one’s personal finances. Before anything else, it is a comprehensive questioning of the self, since it is up to the self to determine how to manage one’s money. Knowledge of one’s financial situation is a way of attaining self-knowledge, and therefore the technical details of finance are inseparable from one’s psychological makeup. But not every author of self-help books emphasizes this connection in an explicit manner. The technique required for self-knowledge is viewed as essential, even when the authors claim that theirs is not a self-help book:
This is not one of those somewhat esoteric self-help books, but it is important that we go through these questions first, if we are to understand the extent of our debt and how badly we need to change our consumption or lifestyle patterns. (Lopes 2009: 157)
23As it happens, there are several questions that have to be answered. So if you intend to be honest with yourself, first you will ask yourself whether you are aware of inflation, of having made any emotional investments and purchases, of a tendency to refinance debt when taking out new loans (ibidem: 158), or of your willingness to put your accounts in order by budgeting expenses and income (Ribeiro, 2011: 13; Lourenço 2009: 23). The next step in this self-inquiry makes you question yourself about finances as a manifestation of the Self, of your inner being, that which determines your uniqueness and authenticity as an individual. Self-knowledge allows you to delimit the factors that depend on personal control, thus removing from the equation those that tend to escape control. Self-help typically meets the duality of our inner and outer dimensions with the same solution: to move away “from the external circumstances we cannot control and come up with our own responses and actions” (Carrilho, 2013: 10). Financial responsibility is the product of work involving the self and grounded in self-knowledge, because first we must know where we belong, in what way we are productive, what our values and our strengths are: “It is by putting our strengths to work that we will be able to make a difference both in the workplace and in our lives. This work toward self-knowledge must be carried out at all times” (ibidem: 30). Before us is a “path of personal growth” (Zárate, 2008: 13). Finance has an expressive side: it speaks publicly about a person’s distinctive core and allows that core to manifest itself, while at the same time the managing of finance helps shape the person’s subjectivity.
24Financial literacy, by extension, is the precondition for unmasking a reality, a social order or a cultural norm that is harmful to the individual. It serves a demystifying purpose, piercing the veil of appearances to get to the truth. It is therefore necessary to go beyond whatever is defined as conventional, normal or possible. This notion is somehow articulated in terms of a paradigm shift or a new perspective on money (Carrilho, 2013: 27). The new perspective supposedly carries an emancipatory meaning: understanding how money works allows you to be your own master, which is another way of saying that it will get you off the “rat race,” that senseless spiral in which one can barely make ends meet, “working to pay the bills, like a mouse running endlessly on a wheel but not really getting anywhere” (ibidem: 38). A stronger view calls for a radical change in the way we see money, claiming that “virtually everything is a lie” (Zárate, 2008: 12). It is imperative, according to this view, to ignore financial beliefs, “everything we’ve been taught since early childhood and in college, as well as all the stuff they bombard us with every single day through the media” (ibidem: 12). A complete break is in order: “we’re going to see how the world of money with its rules truly works [...]; you’re going to hear ideas that clash head on with everything you’ve been instilled with” (ibidem: 14). Whereas before the goal was to get off “the rat race,” now the acceptance of the truth about the world of money ought to keep you from “following the herd”: first paycheck, first expenses, first home, first mortgage, salary increase, more expenses, new home, more borrowing, more debt. To get out of this vicious circle “we have to start thinking of generating assets that generate assets rather than earning money to buy liabilities, which is what most people do, and is financially very stupid too” (ibidem: 43).
25As soon as one understands the social framework that accounts for the need for financial self-help and sees one’s particular financial situation more clearly, it is time to develop a plan of action in accordance with the books’ prescribed solutions. The plan points to two complementary aspects that are part of a dual strategy aimed at achieving financial success: capitalization and saving.
26The “power of capitalization” (Almas & Madrinha, 2011: 108) is based on the accumulation of interest over time. This entails an assessment of the risk you are willing to take (Ribeiro, 2011: 166), which in turn determines your profile as an investor, ranging from “very conservative” to “very aggressive” (Almas & Madrinha, 2011: 114). It is therefore advisable to start investing as early as possible, since it potentially “leads to more risk-taking and a higher rate of return [...]. They can afford the occasional loss” (ibidem: 108), as losses will be compensated for by future profits. For this, you don’t even have to be an expert: just stay away from “wacky products,” make “cold, well thought out” choices, do not pay subscription fees, and avoid exchange rate risks (ibidem: 125-126).
27The power of capitalization is closely linked to the process of “inventing money,” an inherent trait of entrepreneurs:
These are the kind of people who are always open to novel business ideas, new ways of capitalizing on their savings. I can assure you that by incorporating this mindset in your daily routine, more money is bound to enter your lives, and with minimum effort. (Carrilho, 2013: 57)
28The notion of the dependent person looking for security and a fixed wage gives way to intelligence and integrity, i.e., to the alignment of the desire for profit with one’s life values, which is the basis of financial independence. In other words, we’re talking about never having to work for money again.
29The “power of saving” requires that a number of constraints be imposed on the family and personal budget, which in time will allow you to generate a fund to be used for financial investments: “And at this point the main advice is: save, no matter what. Even in families with budgets so tight that money hardly covers monthly expenses, the watchword has to be ‘save’” (Lourenço 2009: 22). Beyond this initial call, the range of suggestions and advice is pretty much the same across all these books: do not smoke, do not have breakfast out, use public transportation, cut back on your cell phone, cable TV and high speed internet bills (Almas & Madrinha, 2011: 129-136), use ecological light bulbs and turn off taps tightly, buy white label products (Lopes, 2009: 160), reduce or eliminate credit cards and vacation home rentals, share or exchange services with your neighbors, go to the library, wait for the movies to come out on DVD (Carrilho, 2013: 76-82), do not let the children help with the shopping list, do not make any purchases in the check-out line, do not buy designer clothes for the children, do not drive aggressively, switch off appliances in standby mode, insulate your house effectively, and make sure you always close the fridge door (Lourenço, 2009: 91).
30Since saving is always a potential investment, savers are also investors who do not have to be experts. All they need is some basic knowledge to guide their decisions. Thus a very simple understanding of the workings of Euribor, for instance, will be enough for “any of us to make a relatively good guess as to what will happen next in the interest rate market: when there is a risk of rising inflation, the rates go up; when the risk subsides, rates go down” (ibidem: 133). The combined power of capitalization and saving is the only way to ensure that individual material needs are provided for, both at present and in the future. It is also the only way to reduce uncertainty in the face of the unknown. It is a personal goal, an obligation each individual has to face and that cannot be shifted to anybody else. Hence the need for a plan.
31Until now the existence of a social welfare system prevented this uncertainty from making itself felt at the material and existential level, but the situation is quite different at present, a fact used by FSHL to justify the pertinence of its advice: “We wish to impress upon you that although the current financial crisis is surely a passing thing, the bankruptcy of social security is a given” (Almas & Madrinha, 2011: 22). The end of the Social Security Financial Stabilization Fund is due to occur shortly after 2035 (ibidem: 47), which is a bit far into the future when compared with other predictions: “Given today’s social and economic uncertainties and considering also the way social security funds are being managed and distributed, as well as current demographic trends, we do not even know if in ten years’ time we will still be entitled to a pension, or if social security will exist at all” (ibidem: 167). The only truly responsible way out is to take control of one’s life instead of waiting for institutions to come to the rescue: “Because we ourselves, not the government, are primarily and ultimately responsible for our own destiny” (Lourenço, 2009: 21). Accountability and its underlying logic take on not only a material significance, as a guarantee of fulfillment of future needs, but an expressive significance as well, for it tells us about the personality – what, in essence, the individual is.
32The pursuit of this logic, under which financial self-responsibility is a precondition for financial freedom and for a real emancipation from market structures, is also covered by FSHL. Utilitarian individualism, which claims that self-interest is the main driver of human action, and expressive individualism, which views personal subjectivity as the core of identity (Bellah et al, 1989, p. 54-58, 394-395), are associated here with savings and investment strategies and with the development of the Self, giving shape to an anarcho-capitalist type of discourse (Brown, 1997; Streeter, 1999). This is best illustrated by Aitor Zárate, who claims that what is important is to follow a radically divergent path from that of the masses: “Leave the trodden path, do not walk a straight line, and you’re guaranteed to succeed” (Zárate, 2008: 22). At the same time, divergence is congruent with the lack of security and assurance, which are incentives to constant change: “[...] so much the better, as it will allow us to improve” (ibidem: 39). The key is not to be part of the “system,” which in this respect is associated with the social security contributions you want to avoid. Those who keep contributing because they think that is the only way they are prevented from spending their pension money in the present, only show their “level of ignorance and irresponsibility [...]; we must think we can help ourselves and not expect others to do so” (ibidem: 128). Each of us must create conditions to ensure our own security and certainty both in the present and the future. You may complement your investment practices by setting up “tax structures,” i.e., a “legal mechanism that allows you to take advantage of the different legal frameworks in place across the world to pay less taxes” (ibidem: 31), which in any event should not exceed 5% of the profits. Tax evasion is “a sin, a legal offense,” but tax elusion “is neither” (ibidem: 166). Zárate eventually offers a few examples, which however tend to be vague: “I will allude to just one such structure as an illustration [...] but if you are smart you’ll know what’s what” (ibidem: 166 ). The illustrations are tips on the most tax-favorable places. Ireland offers favorable conditions to writers, Denmark is recommended in the case of royalties, the Netherlands are for brokerage firms, Monaco makes it easy to get a fiscal residence certificate, and a Swiss bank account is a solution one should always consider (ibidem: 168).
33There is nothing new about the discourse of FSHL on financial responsibility and the need to correct one’s cognitive and ethical shortcomings with regard to money. It shares some obvious similarities with the discourse we hear from political figures, business leaders, or economics and finance experts. In other words, certain arguments and accounts of the crisis and the Portuguese situation, along with some of the advice and recommendations on financial matters, are widespread in the media and not just in FSHL. The following statements, addressing some of the topics discussed above, are a brief illustration of this prevalence:
Pedro Seixas Vales, president of the Associação Portuguesa de Seguradores [Portuguese Association of Insurers]: “financial literacy must grow in Portugal” (RTP, 31 October 2011).
Aníbal Cavaco Silva, President of Portugal: “We cannot continue to live above our means” (Jornal de Notícias, 16 May 2011).
Vítor Bento, economist, president of SIBS – Sociedade Interbancária de Serviços [Interbank Services Society] and Councillor of State: “Economist [Vítor Bento] says the crisis is the result of the Portuguese having lived like cicadas” (Jornal de Notícias, 26th May 2011).
João Salgueiro, president of Associação Portuguesa de Bancos [Portuguese Banking Association]: “Portuguese guilty of debt” (Correio da Manhã, 25 September 2008).
Carlos Costa, Governor of the Bank of Portugal: “The Portuguese should use credit in a more responsible manner” (Diário de Notícias, 18October 2012).
34These statements express the same kind of political rationality, namely a neoliberal political rationality. The concept of political rationality – drawing on Michel Foucault’s work on the relationship between power, knowledge and subjectivity – has been explored and empirically substantiated by governmentality studies. It describes the goals pursued in the exercise of power, the theoretical principles underlying those goals, and how the nature of the governed subjects is perceived (Rose and Miller, 1992: 178; Marinis, 1999: 87-88). In this light, neoliberalism is not to be approached as a political philosophy, an ideology or a particular kind of market-oriented public policy, but rather as basically a way of articulating those goals, principles and notions about the individual, according to a specific lexicon and a discourse that conceive of the governed subject as autonomous and initiative-driven. Initiative makes it possible to exercise power more sparingly (Ampudia de Haro, 2006: 66-67), which means that individuals will have to contribute toward their own self-government to the best of their ability. But the individual is not viewed as a body to be disciplined and whose resistance has to be overcome (Vázquez García, 2005: 178). As pointed out, the governed are counted on to align or redirect their autonomy in consonance with the goals of the government.
35When I say that FSHL is an expression of neoliberal rationality I mean to underscore its status as a technology of government – in other words, the fact that it is a product that generates a specific knowledge and a specific truth that in turn legitimize intervention in personal behavior and subjectivity. But what kind of truth and knowledge does FSHL generate?
It identifies the type of cognitive and ethical shortcomings that make financial self-regulation impossible or difficult for the Portuguese.
It states that these combined shortcomings account for the crisis Portuguese society as a whole is currently facing. Each individual’s shortcomings and inability to self-regulate produce one negative collective outcome: a country on the brink of bankruptcy.
It claims that such deficiencies can only be corrected by developing financial responsibility and the ability to take control of one’s financial situation. We are dealing here with a transformation not just in technical terms – possessing financial knowledge – but also in terms of personal life, i.e., being capable of taking on the task of governing oneself.
It proclaims that this is a crucial task in a social and collective environment which is seen, on the one hand, as beset by failure and exhaustion (ascribed to unsustainable and irrational patterns of consumption or to the disappearance of the welfare state); and on the other, as the result of paternalistic manipulation, associated with a culture of dependence and submission vis-à-vis the institutions of the welfare state.
36In light of these truths and this knowledge, all action taken to affect the behavior and subjectivity of individuals is imbued with a very specific intent: financially responsible self-government based on saving and investment. When the social is defined in terms of failure, exhaustion, manipulation, dependence or domination, self-government is the only responsible way out to fend off life risks: “Keep in mind that if we don’t look after ourselves, no one will. It is up to each and every one of us to increase our income and generate wealth” (Carrilho, 2013: 73). But we must not forget that responsible self-government takes place in the market: investment and capitalization, effected through the financial markets, is what allows individuals to protect themselves against risk and make sure that their needs are met. In short, FSHL is one more tool made available by the market so that they can manage risk through the market. Therefore all the uncertainty caused by those risks is less felt when people are financially responsible. Or, to put it differently, to be left at the mercy of uncertainty is just a sign of individual irresponsibility.
37We could say that what we have here is simply an updated version of your archetypical individual guided by the principle of utterly traditional prudence – which would take us back to the abovementioned Senhor Manuel, a model saver, or to Grandma Clara with her strict budgeting of household income and expenditure as a means of anticipating financial decisions (Lourenço, 2009: 23). When we put it this way, prudence is associated with the expectation of income growth, the deferral of gratification and, more importantly, risk aversion (Erturk et al., 2005). However, this is not quite in tune with the type of individual envisioned by neoliberal rationality in general and FSHL in particular. It will be more appropriate then to speak of a new prudentialism (O'Malley, 1996: 203), which views risk as something positive, an opportunity that one can manage in a deliberate way. This presupposes that the individual chooses the risk level he/she is willing to accept, the premise being that the existence of risk should never be an excuse for not investing:
If your main goal is to eschew all worries, you are sure to remain poor. Life should be an adventure, and worrying is an inner pleasure principle. If given the option to choose between being poor and being worried, I’ll choose worried. Only by placing a portion of your money at risk, a fairly controlled risk, will you be able to make it grow more than that of those who do not own much. (Carrilho, 2013: 115)
38It is often the case that economic phenomena are presented as macro-structural processes that tend to stand out by reason of their sheer magnitude. To put it figuratively, if less accurately, they win over you without needing to win you over. The present article argues the opposite: winning you over is an intrinsic part of the rise of financialization. The human archetype projected by FSHL entails a particular subjectivity, suited to the needs and requirements of financial markets. Thus a genre that might seem negligible or anecdotal is shaped into a tool for producing a way of understanding behavior and emotions. The subjectivity model generated by FSHL systematically addresses issues like consumption and debt, not just from a technical point of view, but also and primarily in terms of personal transformation. This personal transformation has one fundamental goal: individual self-government based on the imperative of personal responsibility. At a time when the end of the collective welfare system is being announced and life risks are being transferred to each of us, we should look at those risks as a creative opportunity to guarantee security and fight uncertainty by using the resources provided by the market. FSHL offers a description of the type of subjectivity that needs to be developed for this purpose, but it has a normative component as well: in the context of financialization, this subjectivity is not only functionally adaptive but also desirable. It is desirable because financial irresponsibility is precisely what has caused the current crisis in our society. Being irresponsible is failing to correct those cognitive and ethical deficiencies and shortcomings that FSHL purports to set right. For this reason, irresponsible behavior is bound to pose a risk to society, as its pervasive spread could push the country into bankruptcy. Hence the notion of “cognitive delinquency” (Walker, 2012), having to do with a) the negation of the process whereby risk is socially produced and unevenly distributed by force of one’s social standing; and b) the growing individualization of risk and the commodification of the resources available to control or explore it in financial terms. Based on this, we are to exercise this responsibility by using the means offered by the market and under the conditions stipulated by it – supposedly an exercise in civics, in which participation in the public sphere is traded for private engagement in financial matters.