If there is a tangible threat posed to our economic existence, it is that of the Zombie Banks, the massive credit institutions whose balance sheets are so disproportionately weighted with ‘toxic assets’ or dead capital that they essentially function as massive value-vacuums. By dead capital, we mean loans that no longer perform or no longer procure a return, and that have as their only security rapidly devaluing collateral as bad, if not worse, than the nonperforming loans themselves.
Zombie Banks have been parasitically infected by these negative assets, appearing like the hosts of a virus that, as in contemporary zombie films like the 28 Days Later series, begin embody their own affliction, not simply as carriers of the disease but as something like macrological pathogens, life-sized viroid monsters. As economist Michael Hudson puts it [via Jodi Dean]:
A zombie bank is supposed to be a bank that has negative equity. And the word “zombie” comes basically from parasitology. Everybody—people often say the financial sector is a parasite extracting. But a parasite does more than that. It doesn’t just take nourishment from the host; it takes over the host’s brain, so the host thinks it’s actually part of the host’s body and, in fact, it’s its child, and it nurtures it.
Hence, such banks begin to act as viral parasites on other banks, and increasingly on the federal government as well, demanding constant infusions or sacrifices of capital to keep them alive while nonetheless furnishing no return, nor exhibiting any recovery or even stability. It seems they become all the worse for all the efforts of the Treasury and the Fed, and moreover, they themselves play the role of dead capital on the ‘balance sheets’ of these institutions. Whereas before banks infected each other with parasitic toxic assets, they now become parasites themselves upon their benefactors, no longer hosts but themselves enormous viruses.
The massive value contractions symptomatic of dead capital are evidence that the latter are a case of econontological ‘black holes’, along the lines Michael lays out:
Could there not be ontological voids or black holes? Could there not be entities that are entirely vaccuous to the extent that they deny Being to those entities around them, that is, that like black holes, actually exist not only as void in reality but destroy existence itself?
If ‘dark matter’ is that which is a nothing without context, that is, not a simply empty space in reality, I think the comparison to a black hole is fitting. My ontological black hole not only exists as void, but denies its very context and exists to annul its context in the universe. It is not a quasi-being, not a ghost, but a voided void, an absolute denial of existence.
Dead capital has seemingly the inverse function of ‘living’ Capital, that of the continuous increase of itself or its value, as the former rather exists only as a locus of the contraction or implosion of the value of assets, or instances of Capital’s reproduction. Dead capital is the very embodiment of the wanton destruction of value, and moreover transforms its host or ‘context’ into a zone of annulment or voiding, pulling its surroundings into its event horizon.
Zombie banks, as the horrific energy or post-mortem animation of dead capital in the flesh, are hence the flip side of what I previously referred to as null or ‘ruined’ productive sites, as sites from which capital investment has withdrawn, and hence within which nothing registers as valuable or, econontologically speaking, ‘existent’. Zombie banks, on the other hand, are sites in which there is no more novelty or surplus-value to be extracted, in which extraction has decelerated absolutely, but which nonetheless enjoy an ever-increasing investment for the futile purpose of ‘curing’ these sectors of their sterility or vacuity.
Moreover, dead capital and its zombifying effects are here to be strictly opposed to the hauntological specter, in that the voided or zombified region or econontological black hole allows nothing to return from it, it permits no spectral remainder to persist but acts rather as a kind of absolute absention or obliteration of whatever enters its borders. We can say, on the other hand, that spectrality functions as an almost perfect description of the ‘normal’ functioning of capital: an initial investment or loan is granted to a given enterprise, or in a sense ‘bequeathed’ to it and inherited by it. Yet this inheritance is not a straightforward appropriation, but involves as a work of inheritance that must discover more than was given in that given, a surplus-value. Finally, the debt cannot be simply ‘laid to rest’ through repayment, but returns in excess of what was inherited in the form of interest, as a kind of spectral injunction or demand. There is hence no ‘pure presence’ of investment as a kind of ‘repaid loan’, but rather an infinite deferral of repayment into the future in the form of interest or ‘return’. (This is to oversimplify both finance and hauntology, but I do believe in their homology and hope this analogy elucidates it to some extent.)
In contrast, we should say that dead capital is a matter of the corpse, not the specter (to paraphrase Alex). The horror of the undead is not that of the spectral return of debt as interest, but of something that will simply not return, something that is inexplicably ‘gone forever’. Whereas the hauntological longing of Capital admits to the nostalgic fantasy that yes, the dead still persist, we have not lost them completely, there is still hope that our loved ones are waiting for us, they will return to us… the case of (un)dead capital forces us to confront this fantasy as such, and to accept that no, the dead are in fact gone, they will not return, all that is now left of them are stupid pieces of rotting flesh. There is no longer a spirit, not even a spectral spirit, but only the inertia of the corpse, or worse, the unspeakable animation of the corpse, brutally illustrating that there is nothing left of the loved one in that body, it is only a soulless mechanism of destruction.
If this last bit seems to cloud the economic discussion with emotional pathos, one should take note that it is not a mere metaphor. Capital fundamentally relies upon such a fantasmatic logic of loss and mourning, in the mode of its origins. If we admit that all existing wealth is the materialization of ‘dead labor’ or already performed labor embodied in its products, labor not itself performed by the current owners of said wealth, then Capital essentially is an inheritance, ‘bequeathed’ to the capitalist. The fundamental presumption of Capitalism is that this accumulated dead labor is not itself an inert quantity, but rather has a certain productivity proper to it – a kind of ‘undead labor’. It is this presumed productivity ascribed to dead labor that marks the transition from mercantilist wealth to wealth as Capital.
Moreover, this productivity of undead labor or Capital is not equivocal with that of living labor, but serves as a necessary condition of the latter: it is the investment of living labor qua force of production with existing capital qua means of production that raises the former out of subsistence and into a genuine productivity, that of a product that is not also an immediate object of consumption. The product, having attained this level of autonomy by virtue of undead labor, thereby becomes a commodity. In this sense, the product of undead labor is productality proper, as the surplus value of a product over and above the satisfaction/reproduction of the living labor that produced its materiality.
The crisis posed by dead capital and its zombifying effects is thus that of the inertia or non-productivity of undead labor. Dead capital is, in other words, dead labor that remains dead, and that, in so remaining, has a collapsing or voiding effect on the production of surplus value, swallowing it up as a black hole of value. There is a movement from Capital as zombified labor, to zombified Capital as labor that remains dead without any excess of undeadness.
To conclude, I can only hint at the bearing the recent discussions of a Dark Vitalism may have upon such econontology. For one, there is seemingly a parellel between my discussion here of un/dead labor and Michael’s weird Schellingianism of a retarded materiality. I also hope to have complicated the tentative distinction between ‘cold’ and ‘spectral’ vitalism, which in my view seem to be complicit modalities rather than distinct theoretical positions. Moreover, this discussion gives us an opportunity to return to Dominic’s theory of unlived life, which for me is a more eloquent description of what I’ve been calling ancestrality than I’ve been able to provide. This is opportune considering that my tentative approach to the problem of un/dead labor must involve this concept of ancestrality as catastropic loss of potentiality-to-be-other. This latter point in fact is probably the best one-sentence synopsis I can give of my bachelor’s thesis.
Finally, it seems that, in the context of econontology, Dark Vitalist ruminations become less a matter of philosophical curiousity than one of vital necessity (pardon the pun), in that it is no exaggeration to say that the future of the American economic and political infrastructure, and even that of capitalism more globally, hinges on precisely the threat posed by dead capital, zombified institutions, and the ‘second death’ of dead labor. Our ability to properly pose and confront these problems is absolutely crucial, and it seems unlikely that current economic theory contains the resources necessary for such a problematization. I think Dark Vitalism might, in this context, provide an essential supplement to economic theory, if the latter becomes vulnerable enough to infiltration. And there is ample evidence that such vulnerability is growing.