Journal: INTERNATIONAL JOURNAL OF POLITICAL ECONOMY
Year: 2021
Volume: 50, No.1
Pages: 60-74
Summary:
This article explores the role of power in the history of political economy, with a focus on the contributions of Michel Foucault. It discusses Foucault's criticisms of the narrow understanding of power and revaluates Foucault's method of investigation in analyzing historical facts, power, and truth. The article also examines the effects of economic decisions on social reality and the role of power in shaping economic policies, discourses, and ideologies. Overall, it emphasizes the importance of considering power dynamics in understanding the history and development of political economy.
Analysis:
Danielle Guizzo has assessed two key moments in history where a change in economic theories and models has reflected in the state apparatus and thereby created power relations in society. The Foucaultian concept of power says that the holder of knowledge (here, economic knowledge) automatically wields power (here, state power), used in search of the truth or the goal. Guizzo provides an alternative analysis of power relations being generated not as a top-down approach but from a micro-internal perspective where not only the state but the market and other institutions create and disseminate power without coercion. Foucault has described this approach as a re-creation of the “historical ontology of ourselves” where the subjects are products of their time and place. To understand how power changes (in the form of state action) depending on the economic reasoning of each era, we first understand the relation between power, knowledge, and truth (Foucauldian Trinity).
Any idea, norm, concept, or institution is historically constructed from perception and, therefore, can be changed when the perception changes. The history of ontology is a study of perception. Foucault attacks the narrow conception of power as only coercive but urges to ask why people obey and accept ‘subjectivization’.
The Foucauldian Trinity explores how specific knowledge becomes truth through power relations. foucault ‘s genealogy of power is a reinvestigation of power relationships in history not as coercive but as constructive force. This genealogical approach thus rejects single, ahistorical, metaphysical truths and replaces them with specificity. The state becomes not a macro-institution but one of the many institutions that influence the ‘subjectivization’ of individuals. In this context, Foucault reexamines the role of economic ideas in changing power relations. Guizzo argues with two cases-
⦁ Late 18th-century classical political economy
As already established, power is only sometimes repressive but also productive. In this sense, state power operates through ‘biopolitics’ and ‘governmentality’, linked with political economy. Fighting against scarcity and poverty, the economic principle of laissez-faire reached the government level, where economic liberalism was adopted as state technology, which in turn changed the power relation in the market (changing social reality itself). Introducing liberal economic principles also changed how the government treated its population (thus, a change in governmentality and biopolitics). Minimal state intervention led to the emergence of well-being as part of the policy agenda, where states were no longer controllers but supervisors. Similarly, when Malthus came up with his economic theory of population growth, he asked for the annulment of British Poor laws( a clear instance of state action), which kept people in poverty.
⦁ Post 20th century Keynesian economics
The spread of Keynesian ideas coincided with two developments, i.e. economists turning into “policy advisors” and the strengthening of states as institutional regulators with more interventionist policies. The acceptance and influence of Keynesian ideas by political institutions can be examined in a case where Keynes's theory on how to pay for war led to the inclusion of national accounting systems with the use of statistical tools by the states. States introduced regulatory bodies for taxation and forced savings. Also, the Beveridge Report (1942) and the White Paper on Employment Policy (1944) show how interventionist policies were modernized to deal with unemployment issues. Thus it shows how the economic problems and theorization on issues of unemployment, health, and social security reach the government level and turn into policies that change the power relation (biopolitics and governentality) between the state and the population.
Concluding Remarks:
We must look at the reappraisal of Foucault’s genealogical method by incorporating the power element as the core of social and political practice. This is an attempt to look at power constructively and how it works, from ideas, norms, and theories to the level of state influencing the way a state behaves with its population. Thus, ‘a social body is ruled by economics rational’. The paper was well-presented methodologically, from explaining the trinity concept of power down to the linkage between economics and politics and how the overall political economy reflects the relationship of dominance through knowledge. Truth and power. The conclusion that can be drawn and which is true for every society is how particular ‘economization’ affects the ‘politicization’ of life. It is the power that reflects the ‘why; and ‘how’ in economic theory and how they affect individuals in a certain time and place.
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