May 1, 2013
by Annelise Riles
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In its latest newsletter, the Tobin Project covered the online publication of my recent working paper in which I examine the relevance of “New Governance” regulatory theory to the challenges faced by the Financial Stability board in regulating systematically important financial institutions.
Direct link to my working paper: Is New Governance the Ideal Architecture for Global Financial Regulation?
March 5, 2013
by Annelise Riles
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Bank of Japan, Tokyo
Last weekend we convened a quite exciting conference on “The Changing Politics of Central Banks” sponsored by the Cornell International Law Journal (symposium website). The focus on central banks as political actors is clearly timely given the growing awareness of the public of the distributive effects of monetary policy and also the debates taking place in many countries around the world about the proper scope of independence for central banks. Yet we lack a sufficiently rich vocabulary for talking about this politics. Moreover, this is one of those interesting places where traditional right-left divides do not apply: what do we make of Paul Krugman’s embrace of Abenomics, for example?
The perspectives of the conference participants–academics and central bankers, mainly–varied considerably. Keynote speaker Dan Tarullo pointed out that while independence make sense in the realm of monetary policy there is no reason for independence with respect to the central bank’s regulatory role, since in that space it acts very much like other kinds of administrative agencies which are subject to various forms of oversight (press coverage of Dan Tarullo’s remark: 1, 2, 3, 4). Peter Lindseth, an administrative law and EU law specialist, spoke of the need for precisely this form of administrative oversight. Anna Gelpern pointed out that given what she called “the big blur” of monetary and fiscal policy, we need to begin to reeducate the public about what political legitimacy for central banks should look like. Katharina Pistor argued that the focus on central bank legitimacy was not the entirely right question–that we should be asking “what kind of global financial system do we want”–because as long as we have this system, central banks can do nothing other than what they are currently doing. Bob Hockett argued for an international central bank that would better address the needs of the global financial system than can a network of national central banks. I took the opposite approach to Bob to the same problem: I suggested that the field of conflict of laws, with its rules for determining “who is in charge” in any particular situation, could better coordinate regulation transnationally than can global institutions. Doug Holmes presented the findings of his extensive research on how central banks communicate with their various publics and constituencies in order to demonstrate that central banks are in fact more in touch, and more accountable, than the formal institutional structure would suggest.
What was resolved at the conference? I think we clarified a few points:
Sounds like a mandate for more research. Stay tuned!
September 8, 2012
by Annelise Riles
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I am in Freiburg, Germany for a conference at the Max-Planck Institute on Regulation and Law Enforcement after the financial crisis. Freiburg is the greenest city in Germany, I am told proudly by our hosts: 100% of the energy used in the city comes from renewable sources. Everywhere you see small systems installed in the streams to collect little bits of energy that are pooled to supply local energy needs. Even visitors are supplied with a public transport pass on hotel check-in and advised to take the tram, bicycle or walk to our appointments. The air is clean and crisp and, in marked contrast to my own country, people look remarkably fit and relaxed. If Freiburg can do it, why not Ithaca?
At the conference, I can sense a palpable shift in the way scholars are beginning to think about the financial crisis as compared to several years ago. There is a breadth of approaches–geography, sociology, anthropology, experimental psychology, criminology–and scholars are engaging in direct, detailed and fruitful conversation with practitioners. Everyone seems to have far more patience for approaches and perspectives different from their own–perhaps we have all been chastened by the limits of our own disciplinary viewpoints! The practitioners themselves are more diverse in their views than in the past. Some think the government is doing a great job, but others (including former government regulators) have an extremely dark and pessimistic view of how things are going on the inside, and they are not afraid to say so. The consensus of the conference was clearly that, four years after the start of the financial crisis, we have not made nearly enough progress in making the kinds of regulatory and institutional changes needed to prevent the next one. We joked that each of us outdid the next in our presentations with ever-darker pictures of the political impediments to regulatory reform, the structural problems such as a lack of self-confidence and incentives against forceful action among regulators and prosecutors, and the limits of the securities and criminal laws for addressing problematic behavior. I talked about a different level of problem–the rise since 2008 of a new mode of state managerialism I call Market Totalitarianism (which gives you a sense of what I think of it!) More on that in a next post.
But the real reason I am posting here is that I met a remarkable young legal anthropologist, Johanna Mugler, who is just beginning her teaching career at the University of Bern and working on the politics and epistemology of taxation. She told me what this blog means to her and her students and chided me for not posting more frequently as of late! It’s an honor to have a conversation anywhere with imaginative young scholars like Johanna–and if this blog can be a venue of that kind of conversation with so many readers like her, well, that is all the inspiration I need to get cracking again. Thank you, Johanna!
May 10, 2012
by Annelise Riles
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Kim Brooks published yesterday a review of From Multiculturalism to Technique: Feminism, Culture and the Conflict of Laws Style, an article published earlier this year (64 Stan. L. Rev. 589 (2012)) and that I co-authored with Karen Knop and Ralf Michaels.
You can read her review here.
April 5, 2012
by Annelise Riles
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March 5, 2012
by Annelise Riles
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This coming weekend, at Cornell, we will be holding a very special conference. The conference marks the one-year anniversary of the earthquake and tsunami and subsequent nuclear crisis in Japan. The title of the conference, which will bring together economists, lawyers,
anthropologists, policymakers, literary theorists, and many others from Japan, the US and Europe, is “How can we bring closure to crisis?” The program is here: http://meridian-180.org/3-11-2012_symposium_schedule
As many of you know, the events on and since March 11, 2011 have had quite a profound impact on me personally and professionally. It’s no exaggeration to say that my own vision of my scholarly and professional mission, and even of what is important in life, has been transformed by the events of the year ago. This conference will offer a chance to reflect on the enduring policy questions but also the more personal aspects of all of this, and also to consider what we had his academics and professionals can do to address the continuing political, economic, environmental crises of the moment. If you are in the Ithaca area and have an interest in attending part or all the program, please let me know. You would be more than welcome.
June 20, 2011
by Annelise Riles
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There was a truly saddening story on the front page of the New York Times on June 13 about events surrounding the Japanese government’s response to the Fukushima crisis in the days immediately after the earthquake. Prime Minister Kan rightly mistrusted the nuclear industry and the government’s own nuclear experts, the article says, and hence relied upon a small group of close advisors, none of whom had expertise in the problem. The officials in the relevant
government ministries with material information that could have saved lives didn’t bother to try to get this information to the Prime Minister because, they said, he didn’t ask for it. The company hid information from the government. The academic experts obscured the issues. According to the Times, these people only started actually speaking to one another when the Americans came in and demanded information–and hence they all had to get on the same page about what to tell the Americans at their daily briefing. As I was discussing this over lunch with a senior bureaucrat today, he sighed–Japanese are people who don’t take any responsibility. And indeed, the only person (save perhaps the Prime Minister and his crew) who took any personal responsibility in all of this to do what they could for the welfare of their fellow-citizens was the manager of the Fukushima plant, did so by actually disobeying the orders of his superiors (and thereby probably saved many lives).
We often think of Japan as a country in which people know how to cooperate, and indeed the foreign news media has been full of wonderful stories about how much cooperation there has been among the citizenry in the aftermath of the earthquake. But at least at the policy and corporate levels this was a case of failed cooperation of an almost unthinkable magnitude with disastrous and enduring consequences.
Although readers of this blog know I am a big defender of Japan against Western stereotypes of all that is wrong with the place, I have to say that the Fukushima incident has given me pause. Japanese may be able to cooperate in certain settings–they know how to work together within the family or the company or how to line up for the subway–but what does this disastrous failure of cooperation and lack of will on the part of politicians, bureaucrats and corporate executives to sacrifice for the public good, or at least take responsibility to do all they can in this case, say about the Japanese cooperative ability? What kind of response is it, for a ministry bureaucrat questioned by the Times as to why he did not inform the Prime Ministry that they had a warning system available to let the public know the radiation risks they were facing and thus possibly avert tens of thousands of future cases of cancer, to say “well, he didn’t ask”?
My own country certainly has its sickening examples of government officials failing to live up to their public responsibilities or work together collegially. But in Japan too, perhaps, there is a need for some serious reflection on how to build a more cooperative culture.
June 14, 2011
by Annelise Riles
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There is an old stereotype of Asian markets that goes like this: Asians don’t really have capitalism, they have relational capitalism. Relationships are what matter first in Asia. And then the standard critique follows: and that is why their markets are inefficient, because they care too much about relationships.
In this light, I found the following observation by a Japanese lawyer over dinner the other night about what is wrong with US markets deliciously challenging to the standard dogma: Why, he asked me, when Americans meet in the market, do they insist on pretending they are friends? “When I hire a taxi to take me from point A to point B,” he said, “it is because I want a ride, not a conversation. Why do I have to engage in the farce that what I am really after is a chat about the weather with the driver? Or when I go to get my haircut, it is because I actually want a haircut. Or if I want to buy a sandwich, it is because I am hungry, not because I want to make friends with the waitress. I talk all day long for a living, and yet I find that in America in addition to paying a fee you get charged another kind of charge–you have to do the work of making small talk too.”
He has a point–we Americans seem to need to dress up our capitalism as if it were relational capitalism. In Japan, at least, in contrast, when you pay for a service, you don’t have to pretend the seller of the service is your new best friend.
June 3, 2011
by Annelise Riles
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Yesterday I had an adventure that exemplifies some of the enduringly unique aspects of the Japanese market.
I left my office at 5:30 pm and took the thirty minute subway ride to Aoyama for my evening dinner appointment. I arrived in Aoyama thirty minutes early and so settled into a cafe with a cappuccino to pass the time. Thirty minutes later I went to pay, intending to scoot right on to dinner. That is when I discovered that I had left my wallet at the office.
First, I need to explain how this mistake was even possible. After all, in New York or Paris, without a wallet you wouldn’t get far. But in Japan, virtually all transportation costs, from the subway to trains to buses and taxis, are settled through an electronic card called a PASMO. You can pay for all kinds of other things with PASMO too such as purchases at convenience stores. It is a very advanced system backed by a legal and technological infrastructure that is years ahead of anything in the US now. But unfortunately for me my PASMO was not accepted at the coffee shop nor at the restaurant where I was heading.
So what to do? I summoned the waiter and apologetically explained my predicament. I expected a furious response but he showed not even a hint of concern or annoyance. Just pay me later, he said. Can you imagine a New York waiter having that kind of trusting and generous reaction when faced with a customer he or she had never seen before? I gave him my business card and left.
I phoned my business dinner appointment and again profusely apologized for the fact that I was going to have to borrow money from him despite the fact that I was due to be the host. No problem he said. He had the equivalent of $600 in cash with him so he could cover it. Not a credit card, but a huge amount of cash was going to solve the problem. This was possible because Tokyo is relatively safe enough from theft that people don’t worry about carrying around that much cash. And so my friend’s usage of cash also reflects the weak power of credit card companies over consumers relative to the United States. If you pay cash you don’t have the temptation to go into debt over ordinary indulgences.
When my colleague arrived for dinner he joked, “but is your wallet safe on your desk?” I realize it doesn’t sound like a joke at all to American ears. On the contrary, if I were in New York or even in Ithaca this concern would have been a serious part of the dilemma I was facing. Would my wallet still be sitting on my desk in the morning when I went to retrieve it? But we both understood that this was not something I even needed to worry about. As we finished dinner I borrowed some more cash from him and we stopped by at the cafe to pay my bill from earlier in the evening. The waiter wasn’t the least bit surprised to see me, and gave me back my business card.
The final episode in this adventure happened early the next morning when I went back to my office to retrieve my wallet. I needed to meet my dinner partner from the night before at 9:00am on the other side of town for an academic conference and wanted to repay him the $500 or so cost of dinner. But my bank–actually not a bank but the local post office in fact–did not open until 10:00am. What to do? I simply walked into the convenience store around the corner, put my card in the machine and withdrew the cash. For this I was charged a fee of approximately US $3.00 I bought a nice envelope, since it would be gauche to hand over cash without an envelope, and headed back to the subway.
Japanese convenience stores, open 24 hours, on almost every street corner, are magnificent consumer centers. You can buy all kinds of things there from deli meals to airplane tickets to cell phone contracts to a clean pair of underwear. Young people have started using them for their banking needs more than banks themselves because you are never more than five minutes away from one and you can do your business at any time of day or night. Of course it did cost me something. But not more than what I would have paid to use another bank’s ATM in the US and I doubt that I could have withdrawn that much cash at most ATMs.
All in all, as a consumer I have to say that this incident was unbelievably low hassle relative to what I would expect at home. In fact you could say that my whole foolish mistake was enabled by how convenient it is, say, to purchase transportation services. I should add that my encounters with service providers at every step, from the waiter in the cafe to the automated cash machine in the convenience store, were courteous, helpful and respectful. No surly staff or incompetent bank employees in a telecenter. For me at least, this all counts for a positive aspect of a market.
May 1, 2011
by Annelise Riles
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Last week we convened another meeting of our working group of economists, anthropologists, lawyers, psychologists and policy makers interested in how our disciplines could work together in new ways to solve market problems. It is a very smart, high-powered group of creative people who truly have the best interest of the national and global economy at heart. And the policy makers are brilliant, dedicated individuals who know how things work on the inside, and who think broadly about the issues. Once again, our meeting was supported by the Tobin Project, as well as by the Clarke Program in East Asian Law and Culture at Cornell Law School.
The theme this time was health care insurance reform and we did some hard thinking about what our disciplines could say, practically, about what kind of insurance exchanges might help different kinds of consumers make the best choices possible for them.
But there is another running conversation at these meetings about how the disciplines can be reconfigured to work better together in the future. The disciplinary truce worked out in the early twentieth century was a kind of cold war-like division of the territory: anthropologists study exotic others, sociologists study deviant groups at home, psychologists study individuals, economists study markets, and so on. Thank goodness that along the way we learned that all these elements are inter-related and that each of these disciplines has much to say about every aspect of life. So how else could they work together?
One model that is emerging from our meetings is a kind of production model, beginning with original insights and moving all the way to the incorporation of ideas into policy. Eric Johnson, a distinguished psychologist teaching at the Columbia Business School, suggested that anthropologists could provide the insight (based on ethnographic research), economists could provide the models, and psychologists could provide the data (based on experiments)–and that we need data and numbers to convince policy makers.
Another model seems to be a model of internal change within fields. Peter Spiegler, an economist at U Mass Boston and one of the most truly original scholars I have ever encountered, suggested that economics needs to start incorporating ethnography into its own method of research, rather than just taking insights (about trust, or reciprocity or whatever) from anthropology and modeling them in the traditional way. I argued that anthropologists, conversely, need to learn to value simplicity as well as complexity, and to communicate openly and clearly and generously with people in government and in other fields, as economists and psychologists have learned to do.
There are a lot of things that infuriate me about anthropology and anthropologists. But at the end of the day, some of our most basic insights are sorely lacking in the policy world and could make an enormous contribution to market reform. Here are just a few obvious ones:
-Asking about the givens: noticing what is so important that it is just taken for granted by everyone, including perhaps even the researcher. For example, at our meeting, we were deep into how to structure consumer choices about insurance and one anthropologist asked “why do we value choice so much in the first place?”
-thinking about the global dimensions of even the most domestic policy problems, and thinking comparatively about policy problems. For example, what could we learn about health reform from Japan, or Singapore, or South Africa?
-thinking about the range of actors and interests involved in law reform. For exaple once a law like the health care act is passed the story is not over–it has to be implemented by armies of regulators, interpreted in practice by physicians, drug companies and insurers, used by consumers…how do all these people come together in practice?
-reflexivity–realizing that academics are part of the picture and bear some responsibility for what we advocate for, and its consequences, intended and unintended.
Insight rather than data–ultimately ethnography gives you a picture, and a story, and helps you to to become aware of the aspects of a problem you may have ignored altogether in constructing your model or your policy proposal. Private companies have grasped the value of this kind of insight and are employing ethnographers in large numbers to do market research and study organizational culture within their companies but we have a ways to go before it is adopted as broadly in policy circles.
What do you think are the strengths and weaknesses of each discipline in thinking about market reform? How do you think fields like economics, anthropology and law could better work together to address market reform?
