Capitalizing on Crisis: The Political Origins of the Rise of Finance

"I’ve read a good many books about our recent financial market afflictions, many of them quite good, some excellent. But there’s an awful lot of overlap. Most build at least in part on the same story line: a cabal of libertarian ideologues deployed a washed-up second string actor in the service of an ideological agenda. Krippner is one who tells a different and in itself arresting story. I discovered this book just lately and I’ve learned a lot from it. She is trained as a sociologist and she sees things through a different lens. Support Five Books Five Books interviews are expensive to produce. If you're enjoying this interview, please support us by donating a small amount . Krippner argues that the standard narrative, while not entirely wrong, is misleading and vastly oversimplified. For starters, she points out, the great wave of deregulation, seen as the heart of our problem, can be understood not so much as a purposive story arc as a series of ad hoc decisions designed, first of all, to kick the can down the road. ‘Let the market decide’ often meant little more than ‘we really haven’t any idea what to do about it.’ We also visualized ‘let the market decide’ vaguely as freeing up the world for a whole new smorgasbord of invention and production. It didn’t, really. Rather, most of the can-kicking decisions generated what Krippner calls ‘financialization’—a world in which the techniques for raising or investing money become more important than the nominal product. It’s a world where you can without distortion think of a company like Toyota or General Electric as a “bank.” With a proliferation of debt, it’s no surprise that you also find a proliferation of non-payment."