Financialization in the neoliberal age

Like many universities, VCU’s one and a half billion dollar endowment has become a site of conflict between students and administrators, fighting over the ethical implications of the particular investments that VCU has made. On the one hand, to the extent that VCU invests in the multitude of businesses contributing to climate change1 (or, for that matter, anything problematic, but, then, there is also a history of divestment campaigns that climate change divestment campaigns can be situated within, lending credibility to activists), students’ concerns about the effects of their tuition payments on the world around them seem valid. College attendance is frequently motivated by a desire for a better job and larger pay – when contextualized with the increased funding for oil, coal and natural gas extraction that attendance causes, students appear less like aspiring scholars and more like profiteers. On the other hand, university officials often report a fiduciary responsibility to maintain diversified and profitable investment profiles (whether or not these officials actually have fiduciary responsibilities, as a matter of law, or if this is just a rhetorical technique is another matter), which could arguably reduce tuition, pay for instructors, improve facilities and provide increased funding for students.

This apparent double bind is hardly typical of the university as an institution from a historical perspective, nor is it simply a component of a dominant and fixed ideological imperative that must be adhered to, but rather is a co-production of the development of neoliberalism and finacialization2. As asserted by Cornel West (2004), western democratic states are increasingly characterized by the reification of the firm (or corporation), aggressive militarism dominated by intangible, ever-present threats, and increasing authoritarianism, enabled by increasing faith in quantified accounting measures and a bureaucracy of technocratic managers3, thought to be uniquely capable of finding solutions to political problems (Swyngedouw, 2010)⁠. Government and public institutions are increasingly pressured to model themselves upon business (not that the adaptation of this model does anything to quell ideological opposition to government), and, in conjunction with an elevated emphasis on individualism, it is not surprising that the individual is expected to think of one’s self as a firm as well. All of these institutions, whether it is the privatized post service or the classic nuclear family, are now normatively required to seek profit for their beneficiaries, in the same way a corporation is normatively required to seek profit for the benefit of their shareholders, and the public university is no exception.

This observation is not enough to explain the profit-seeking behavior of universities and university endowments, without the broader context of of the development of capitalism in the 20th century – the modern corporation simply isn’t analogous to the classic factory and its appropriation of unpaid labor. While the larger system is still structurally dependent on finding unpaid labor somehow, somewhere, increasing emphasis on the profit of shareholders in the 1980s demanded that corporations adapt the profit-generating strategies of shareholders, or, in other words, that they invest in other companies (Fligstein, 2001)⁠. So long as common economic wisdom holds diversification and and long-term investment as the safest vehicles to wealth, we will continue to see toaster manufacturers buying media outlets and public universities funding fracking and arctic drilling operations. In terms of the individual, normatively required to invest and diversify, but often incapable of paying the high opportunity cost of personal financialization, this need is often met through investment in the “total market fund,” which is essentially a symbolic investment in the market at large (including everything bad) – ironically, an act that erases whatever small impact individualized market choices might have had on the market in the first place, and situating the individual as small and unimportant in the larger corporate hierarchy of neoliberalism.

For more information about the VCU divestment campaign, check out their Facebook page at⁠


Fligstein, N. (2001). The Architecture of Markets. Princeton: University of Princeton Press.

Swyngedouw, E. (2010). Apocalypse Forever?: Post-political Populism and the Spectre of Climate Change. Theory, Culture, Society, 27(2–3), 213–232.

West, C. (2004). Democracy Matters. New York: Penguin Books.

1Arguably, this includes the entire market, whether for being, in any which way, a component of the capitalist paradigm, or, otherwise, simply because of the observation that money is fungible. The former is a broader concept of the topic of this blog post, which specifically focuses ⁠on the neoliberal phase of the capitalist project, while the latter is something of a slippery slope argument that can make anything meaninglessly problematic.

2I’m tired of seeing, writing about and thinking about Trump, which is why I decided to focus on the somewhat more optimistic trend of local protest, but much of my discussion about this co-production could be applied to the public display/trainwreck of Trump trying to annihilate the very concept of “conflict of interest” from public discourse.

3An extraordinarily sad but telling example of this was on display in the fifth Republican debate, where candidates tried to manufacture contrast between each other through their insistence that their potential administrations could find more targets to bomb in Syria, which only served to reveal their own ignorance of the day-to-day world of the bureaucrat-soldiers actually waging the war.


Peter Jameson


One thought on “Financialization in the neoliberal age

  1. I love your political economy analysis of university funds. I wonder if a stronger application of West would show how this commodification of university disproportionately hurts low income/minority students. Or how it reshapes the idea of public goods to the detriment of the powerless.

Leave a Reply

Your email address will not be published. Required fields are marked *

Privacy Statement