#emac6374

For the new “version” of this text object AKA blog entry, I wish to spare everyone’s suffering through a rehash the original. Rather, with the passage of time, I think it more appropriate to reflect on the major “historical” (what technically isn’t historical?) upheavals/changes since penning the original entry back in October. Naturally, I will continue to dwell on the theme of contagion with regard to the financial meltdown started circa 2008 that continues to this day. Namely, I extend the discussion that centers on this passage taken from the original blog post:

My point is not to give a blow-by-blow analysis of Part I, but to document my visceral reaction to it, which I have nearly forgotten at this point. In the blog post after this one, I have thrown compiled a list of words and thought associations culled from this section of the book. The emphasis is on those words and phrases most closely associated with the idea of a new paradigm for understanding digital contagions: they constitute internal threats equally if not more so than external (p. 44); the worst, most effective damage comes from targeted attacks (“shocks”) at key, well-connected nodes in the network (p. 45); under the concept of a scale-free topology of networks, the success of a contagion stems from infecting a few select nodes (the elite nodes, I would say) in close proximity to alike “power nodes” or hubs that are incredibly well-connected (better than the average “network assemblage”) to the rest of the network and lie in relatively close “spatial proximity and equilibrium” to each other (p. 55).

While Thomas S. Ray is quoted as saying, “The objective is not to create a digital model of organic life …”, I am in a way breaking this rule by applying a newly refurbished digital model of virality and contagion to the socio-political phenomena (not necessarily organic, I realize) of the latest financial crises. After spending last summer reading Matt Taibbi’s Griftopia: Bubble Machines, Vampire Squids, and the Long Con That Is Breaking America and parts of Naomi Klein’s Shock Doctrine: The Rise of Disaster Capitalism, I cannot help but see the latest round of disastrous events clearer than ever through the lens of this reconfigured model of digital contagion.  The corruption (credit default swaps, toxic loans, bad mortgages, housing market collapse) that infected our financial system stemmed from a small cabal of powerful, well-connected players (e.g., Wall Street Bankers, Goldman Sachs, Lehman Brothers, Bear Stearns and others aided and abetted by politicians, lax government regulation, the Federal Reserve lead by Alan Greenspan) – the nodes or network assemblages of aristocratic connectivity whose activities were kept well hidden from public scrutiny (i.e., they were a nearly invisible internal threat) – many of whom paradoxically ended up rewarded for their misdeeds thanks to a political apparatus (the other internal hubs or nodes of power) more accountable to the anti-democratic influence of corporations than to the democratic influence and outcries of its own people.

Network analysis lends itself easily to the examination of the collapse of markets. It provides an adequate though not comprehensive paradigm for making sense of the mess that is the Great Recession. If I may call upon my faulty memory of Christakis and Fowler, the network paradigm grants us a more nuanced understanding of the phenomenon  of the financial collapse than strictly limiting our view to key individual players (methodological individualism) or its polar opposite, the (economic, political) system as a whole (methodological holism). Rather, a happy medium that strikes a balance between the two methodologies is called for in the adoption of the network paradigm. However, the trap we want to avoid is that of an uncritical exaltation of the network employed by Christakis and Fowler. After all, their infectious, quasi-Pollyannaish attitude toward networks likely contributed to the failure to see and perhaps even prevent (or at least mitigate) the financial disaster of the century sooner.

Rather, the approach of Galloway and Thacker (The Exploit: A Theory of Networks) offers a more critical, albeit more intellectually challenging, method with which to interpret the collapse as a whole. I will grant that contagions on digital networks are not in and of themselves malignant or malevolent. Such blanket judgments are facile and shallow, as we well learned in The Spam Book. If I may hark back to my original musings on contagions through the light of network analysis, I still hold to the assertion that a network model or network theory given the Galloway and Thacker treatment (that is, filtered through the lenses of Deleuze, Guattari, and assorted pomo philosophers) opens up a fuller understanding of the latest exploits enjoyed (and inflicted) by the “winners” of the economic debacle.

At play in the collapse were multiple networks (or “assemblages” to use Spam Book terminology) operating at different levels. In one corner were the banksters and hedge fund managers, AKA the investment managers AKA the big gamblers. They operated under a dogged delusion of optimism, that is, they were determined to take large, unnecessary risks in the name of big profits. If they lost money, well – so what? - it wasn’t theirs being lost. It was the investors’, the often unwitting pawns in the game (they make up another network), who would under watchful, controlling eye of the investment managers have little to gain and everything to lose. And, so their thinking often went, the next “big win” was just around the corner. There was no way that any underhanded dealings or gigantic losses would catch up to them. If so, they would be long gone, leaving the people to whom they were legally, financially, and ethically beholden (in theory) to foot the bill.

If history, sociology, and human psychology have taught us anything, it’s that this economic optimism is irrational, inflated, and unfounded. In the WS gambling game, there has to be losers; not everyone comes out rosy in the end. Yet the fast and loose players deluded themselves into believing that investments could go nowhere but up, and those that knew better would simply jump ship as soon as the floor fell out beneath them. With so many investors’ pensions and retirements on the line, it is very sad to think that we lowly “ordinary folk” have come to depend on such a system for our fortunes during our twilight years. The folly of irrational faith in The (Great Free) Market demonstrates what a tragedy such thinking leads to in light of recent events.

Even worse is the thought that so much of the finance game is rigged against us, the “lesser” network AKA the network that doesn’t (but should) hold any power all along. The “big players” AKA elite nodes experience the best, strongest connections within their own network, which are then supplemented by equally powerful connections to the network of politicians (another major set of elite nodes) that aided and abetted them (and continue to do so to this day). As the elite nodes, the big players stood in a position of unfathomable privilege and power as they overplayed the wins and downplayed, hid, or outright lied about the risks in the WS game (again, all well documented in the writings of Matt Taibbi, Naomi Klein, and noted economist Paul Krugman). And yet, contagions of at least two types were at play during the collapse that illustrate how utterly undemocratic network structures are (as argued by Galloway and Thacker in The Exploit) as opposed to the “networks are liberating!” viewpoint advocated by Christakis and Fowler. The elite nodes/power players even manipulated the promiscuity factor to their benefit  (Sampson, p. 55). As the losses rolled in and piled up, the elite nodes were more than happy to dump those negatives on the unsuspecting and largely helpless network of joe-blow, you-and-me investors. For this purpose, the network of greaters and the network of lesser were well connected and rampantly promiscuous, in fact, unidirectionally so. When it came to sharing the gains, the level of promiscuity mysteriously and miraculously shrank to apply only to those in the circles or networks of the elite. Suddenly, the network of lesser was not so well connected and continues in this fashion to the present.

It will require an exploit or exploits of monumental proportions (again, as advocated by Galloway and Thacker) for the lesser network to see any justice exacted. Since writing my first entry on this topic back in October, we have witnessed (and many have contributed money and resources to) the coalescence of the Occupy Wall Street movement. An antidote to the insider, poisonous, avaricious behavior of Wall Street and to the overt corruption in Washington that enables such heinous behavior by the WS crowd is badly needed. A contagion of the most virulent, potent, and far-reaching kind is needed, but OWS has a dubious future in light of the extremely uneven ground on which it stands. In the past couple of months, many of the demonstrations have been quelled, pushed out of existence. Clearly, the powers that be, those in the position of the elite nodes, refuse to give up their power easily, going so far as to use the very police forces who are supposed to be dedicated to serving the people to serve their interests instead.