ISSN: 1705-6411
Volume 5, Number 1 (January 2008)
Author: Dr. David Teh

I. Introduction
The contemporary geo-political situation has crystallised oppositions between a “secular” West and its Others. Some recent theorists (Kepel, Huntington) have identified the return of a religious and “cultural” difference – supposed to be irreconcilable – in place of the Cold War’s ideological differences. But while the primitive strategies of today’s terrorists certainly mark an irruption of otherness, they also have a more immediate history, one rooted in post-war economics and geo-politics as much as in the ancient rivalries of world religions. Similarly, scholars have yet to give much historical or geo-political background to Baudrillard’s concept of “symbolic exchange”, despite recent interest in it. And perhaps this is no surprise, given its timeless and placeless character, its defiance of linear historiography. But while we cannot examine symbolic exchange as a history, we can examine history for evidence of symbolic exchange. And it is precisely because history has been blind to symbolic exchange that symbolic exchange is able to blindside history.

This paper examines a set of “symbolic” currencies whose values shadow that of capital, but also exceed it, with a remainder that cannot be reduced to its law of general equivalence. This symbolic economy throws a different light on the crises that befell these currencies in the 1970s – that is, the period of symbolic exchange – a period that saw foundations laid for many of today’s intractable global conflicts, e.g., today’s global terrorism, which might be read as a response to the rise of a global “symbolic exchange”.

The postwar period has seen the world’s dominant powers deeply and continuously ensconced in intercontinental military and para-military adventures. But if ever there was a period to validate at once Clausewitz’s adage, that war is the continuation of politics by other means, and Foucault’s inversion of it, it was the 1970s. The decade of symbolic exchange was shot through with disturbances to the world’s economic and symbolic orders. It began with two watersheds in economic history: the abandonment of the gold standard in 1971, and the OPEC oil crisis in 1973. And it culminated with the commencement of the Iran-Iraq War, the Islamic Revolution, a spate of dramatic hostage crises and the engineering of somatostatin, the first human hormone to be reproduced using recombinant DNA technology. Is symbolic exchange capable of explaining how these events were connected?

Symbolic exchange reflects a decade in which economic value – and liberal humanism – undergo something of an identity crisis. Speaking of a “symbolic crisis” I’m flirting with two forms of temporal parallax, framing the present situation: 1) the word “symbolic” grounds the analysis in a “timeless” conflict – religious and cultural, and therefore somehow not “ideological” (Huntington). This is sometimes an explanation for – or rather an excuse for not explaining – an ascendant fundamentalism. 2) “novelty”: this situation is hailed as a “new era” of conflict, one that is networked, post-nation-state, cellular, etc. Both of these ideas are founded on truths – and truisms – of the present conflict. But together, these narratives are deployed to obscure the very direct links to recent economic history.

My desire is to examine the period of symbolic exchange and refract, through Baudrillard’s lens, some normal narratives of economic history – money, oil and life. In my thesis, I juxtapose their “crises” with the ideological crisis of the late Cold War and its failing currency of otherness; and with the informatic crisis, the failure of value Baudrillard calls “reproduction”. This led me to look at the interplay between these symbolic currencies and capital, asking, in loosely Bataillean terms, are their economies “restricted” or “general”? What I will present here is intended as both an overview and a provocation.

II. Symbolic Currencies in Crisis
Baudrillard’s symbolic exchange begins to take form in his (1972) For a critique of the political economy of the sign. By 1979, it passes into the language of Seduction.1 The concept is pivotal, designating, without necessarily explaining, a development between the theories which precede and follow it. But the context in which it has been read is mostly bibliographical. Few have given it an historical or geo-political backdrop, and perhaps this is no surprise, given the concept’s timeless and placeless character. Yet this period saw the beginnings of many of today’s perplexing, global conflicts. There is a certain irony in taking such an approach to something as opposed to linear historiography as symbolic exchange. But while we cannot examine symbolic exchange as a history, we can examine history for evidence of symbolic exchange. And it is precisely because history has been blind to symbolic exchange that symbolic exchange is able to blindside history.

III. Conventional Indicators: Oil and Money
By 1972, OPEC members accounted for over 50 per cent of world oil production. The OPEC embargo on sales to the US in 1973 sparked an extraordinary price-hike, the global economic effects of which are well known. In six months, the cost of crude quadrupled. Late in the decade, Iran was fulminating at the Westernisation imposed by the CIA-backed Shah; by the time he had fled, oil prices had doubled again. Taking advantage of his neighbours’ instability, the young President of Iraq, one Saddam Hussein, attacked Iran, re-igniting antagonisms ancient and recent, and sparking an eight year war which would severely dent OPEC’s production levels. The US – fighting the Cold War on every continent, with its newly floating dollar – was not exactly a portrait of fiscal austerity.

The oil crisis marks the beginning of the end of an era of production, that era in which “What was good for General Motors was good for the country”, as the company’s chairman Charlie Wilson famously put it to the US Senate in 1953. Wilson had just resigned from GM in order to become Secretary of Defense. Asked whether he could put the country’s interests before those of his former employer, the largest corporation in the world, he replied: “For years I thought what was good for our country was good for General Motors, and vice versa. The difference did not exist.” The Senate seems not to have bothered asking Dick Cheney the same question about his allegiances to petroleum giant Halliburton. Apparently the prospect of divergent interests was not deemed sufficiently likely.

The automobile sat at the very core of that economy – the ultimate object of consumption, but also the emblem of a whole logos of production: Fordism. These days, one takes the temperature of the US economy not from producers, but from consumers, not Ford, but Walmart, by an abstraction called “consumer sentiment”. It’s not a society’s productivity, but its collective wastefulness, that indicates fiscal health. What’s good for consumers is good for the country, ample testament (were it needed) that it is the disposal of surplus that determines modern society’s development, that “impels” it, precisely as Bataille said. And this waste, while it has economic ramifications, always also denotes a symbolic expenditure.

In the 1970s the escalation of values (at this early post-industrial moment), unsettled the order of general equivalence. Baudrillard’s critique of general equivalence includes both the political economy of the sign and simulation. Both are critical perspectives on economic equivalence and value, and on the philosophical question of representation. They therefore interrogate a certain principle of identity that guarantees and distributes values in the economy, an identity that links things to their value, that links the sign to its referent. Symbolic exchange is continuous with this critique of general equivalence, reflecting a moment at which money – the identity of value, the representational device of equivalence par excellence – undergoes something of an identity crisis2 with the abandonment of the gold standard (in 1971).

A gold standard means that money represents, and is convertible into, gold. When it is abandoned, money represents only itself – it loses, as it were, its “reality principle”, that which grounds it in the finite, restricted realm of material value.3 Hence the symbolic fallout when the British Ambassador to Washington arrived at the Treasury Department to request $3 billion of gold for his country’s stockpile of US currency. The French followed the British to the “gold window”, prompting Nixon to close it, declaring an end to the gold standard for the US dollar and, by implication, for the world economy. The greenback henceforth became a free-floating signifier. Though it took a beating, US economic supremacy remained intact. What was upset was a symbolic order that had helped steer the Western industrial powers to almost two centuries of global domination.

Money’s identity crisis marks a crisis not just in the representation of value, but in the value of representation. Even as signs become “irreferential”, the exchange of symbols realizes an ever more material value – the production of meaning, sign industries (communications, media and service industries) become increasingly important contributors to the economy. 1971 also saw the United States’ first trade deficit since the War. Economic historians have made much of this turning of the global tide of material wealth, typically with a nod to America’s “stagflation” problem and the post-war maturation of European and Japanese industry. But historian of science Susan Wright points to a more fundamental and qualitative shift. Between 1972 and 1979, what we now call old economy industries, which are “not research-intensive”, registered a trade deficit which tripled; over the same period, the research-intensive industries – including “computers, semi-conductors, telecommunications, … and pharmaceuticals” – rang up a surplus, which quadrupled.4 The significance of technoscientific research in stoking the nation’s economy became very clear.

The crises of money and oil, while they yielded legible politico-economic effects, also reflected the symbolic: each could be considered a sort of reality check for the advanced economies: 1) at the gold window, the expiry of a symbolic pact between a thriving US and a ruined Europe (the “giving without return” of the Marshall Plan); and 2) the advent of a multi-national Arab resistance to the West’s economic bullying and its sponsorship of Zionism (with the Yom Kippur War), which sparked the OPEC embargo (and which – not incidentally – involved deployments from just about all the countries since sanctioned as “State sponsors of terrorism”, with the exception of the Shah’s Iran – Iraq, Saudi Arabia, Syria, Libya, Algeria, and the Sudan).

Today, economic globalization is reeling from a reality check of its own: global terrorism. But its origins may be found in the early 1970s, with the consolidation of the PLO under Yasser Arafat, but also at the Munich Olympics, in Northern Ireland, Germany’s Baader-Meinhof gang, Italy’s Red Brigade5 , the Japanese Red army and so on. Much of this terrorism was clearly indigenous to the developed world, a relation Baudrillard would later read back into the terrorism of today, against the West’s phantasms of its exotic zealot-others.6 According to conventional wisdom, hostages represent a challenge to the global system of rights and security, a challenge that appears to come from beyond it, an intrusion by an extreme otherness. For Baudrillard, however, hostages are a measure of the extremity of the system itself. And so to the currency of life.

IV. Life – The Impossible Exchange of the Hostage
Alongside our economic currencies, there circulates an anthropological value also supposed to be universal: the individual. But the world humanist system of value breaks down precisely when this individual – the free individual, of rights, the “orbital currency” of global citizens – is taken hostage.

Terrorism aims to engage symbolic values against those of the market, reintroducing inequivalence and inexchangeability to the field of general equivalence. State power’s refusal to negotiate is therefore something of a charade, since the terrorist has already refused to do business, in by-passing the official overtures of conflict (e.g., declarations of grievances and hostilities). There must be no background to the terrorist act; each one must make for itself a new situation. (“This is the situation”.) The terrorist’s contempt for proprieties – such as the sanctity of non-combatants, and the value, the absolute positivity, of life – signals a disavowal of the day-to-day commerce of the political. If there is a context, it is only that of terrorism itself. “Each taking of hostages … is linked to another” in a global “chain or succession of transpolitical acts.” … But this symbolic, “orbital” currency may be no less susceptible to the crises facing all the others: “Nothing resembles this circulation of hostages,” writes Baudrillard, “more than the circulation of Euro-petro-dollars and other floating currencies, which are deterritorialized to such a point, beyond gold and local currencies, that in reality they are virtually no longer interchangeable.7

The inexchangeable hostage thus suspends the economic laws of value. Not even their death can restore the system of equivalences that their very existence threatens with collapse. Terrorism has always turned on the matter of inexchangeability. Originally, it was the State that assured this (“We will not negotiate with terrorists”). Of course, things often ended in political compromise and exchange. But this policy of excommunication is terrorism’s condition of possibility, the stalemate, an irresistible object for the media. These days, inexchangeability is a condition imposed by the terrorists themselves. There are no longer even any demands. Since 9/11, the stakes have been raised such that no symbolic reply is possible for the global order, save for its total collapse. “To a system whose excess of power creates an unsolvable challenge, terrorists respond by a definitive act that is also unanswerable”.8 Terrorism is properly a non-negotiable act, a différend – it names a total threat to the phantasy of an international rule of law, which seems bound to respond with totalitarian measures.9

The near total paranoia inspired in the state by terrorism is in no way an over-reaction. It only matches the gravity of the threat – which is not a threat to life, but rather life’s threat to a whole order of value. For life held hostage is not value, but its opposite – designating a radical non-value and inequivalence, hostages “no longer represent anything”; “cryogenized” and inexchangeable, they short-circuit every political exchange.10 For the hostage is beyond exchange, unsacrificeable, frozen “in a state of radical exception … a state of exhibition pure and simple”.11 A life which cannot be redeemed for economic value; a death which cannot be exchanged symbolically; a figure which puts into crisis the economic and symbolic values of life.

V. Life in the Age of its Mechanical Reproducibility
The 1970s also saw the explosive birth of biotech, with the advent of recombinant DNA techniques, or gene splicing. It all happened rather quickly. In 1970, scientists isolated the first “restriction enzyme” that could cut DNA molecules with precision. 1971 saw the founding of Cetus, the first corporate player. In 1972, the first recombinant DNA molecules were produced at Stanford. By the following year, they could be replicated in a microbial “factory”. By 1974, Stanford had patented recombinant gene technology. In 1980, the US Congress passed the Bayh-Dole act which allowed universities to patent and profit from innovations that had been publicly funded. The same year, the Supreme Court held (in Diamond v. Chakrabarty12 ) that engineered living organisms were patentable – life itself had become commodifiable, not as property, exactly, but as intellectual property. Biological science thus comes dangerously close to its reality principle and its symbolic currency: life.

We know that life has not always enjoyed the status of a reality principle. Foucault reminds us that before the nineteenth century, although there are living beings, “life does not exist”.13 “Natural historians” concerned themselves with description of what could be seen, not with life per se – it was one classifier amongst many, imprecise and contingent. … It still had to be produced as a concept, in order to assume its “autonomy” and “escape” natural history’s general descriptive matrix.14 So life may not have commanded for long the timeless, “inalienable” value we might like to accord it. And it may lose it. The following is a quote from a prospectus of the Cetus corporation, a pioneer in the emerging field:

No process of mutation or evolution will ever cause a micro-organism to manufacture insulin, … or an antibody to save a patient dying of encephalitis. … Gene splicing can and will make these things possible. Gene stitching finesses evolution; it breaks nature’s species barriers. We propose … to stitch, into the DNA of industrial micro-organisms, the genes to render them capable of producing vast quantities of vitally-needed human proteins, … to make these proteins in virtually unlimited amounts, … to create an entire new industry, … manufacturing a vast and important spectrum of wholly new microbial products using industrial micro-organisms.15

Thus barked the corporate dogs of the biotech revolution, casting around for venture capital in 1975. I’d particularly like to emphasise the parallel with rhetoric of the dotcom era. All the moral appeals of our can-do techno-industrialists are in there: the overcoming of nature, through both the transgression and the “finessing” of its laws; “vital” need; salvation by progress; and above all, production, production, production. Yet history has proven none of their claims exaggerated. The most revealing is perhaps the most hyperbolic – that of an industrial process whose produce is “virtually unlimited” – hyperbole, but for all that dangerously true.

Beneath all this hype lay a profound reconsideration of the nature of life and reproduction. Life became subject to industrial techniques; its mysteries dispelled, reproduction could be over coded as a rational process. A symbolic crisis, no doubt; but it poses, in the context of bioproduction, the very problem of information, the same problem faced by the US Treasury after 1971, that of a boundless supply, of a limitless value, an overflow of positivity. All this sounds positive enough in theory, but its practical implications are nothing short of cataclysmic. Biotechnology implied an entirely new metaphysics we now recognize only too well, the metaphysics of infinite-reproduction-at-zero-cost. The inputs of the new processes – DNA, cells, viruses, plasmids – are indeed all in limitless supply (as in the elemental, heliotropic world of Bataille). And this is where the biotech bulls are wrong: production is nowhere to be seen here. What they are selling – strictly speaking, or loosely – is reproduction from start to finish.

In 1978, with the birth of the world’s first test-tube baby, human life became subject to technoscientific reproduction. Biological reproduction was assimilated with industrial reproduction, losing once and for all its naturalist distinction, its monopoly over human genesis. The debate that raged over In Vitro Fertilisation opened ontological and ethical quandaries that have only deepened since: in the brave new world of genetic engineering, what is it that guarantees the specificity and value of individual life? Meanwhile, at the other end of the human drama, the other symbolic guarantor of life, death, was also thrown into question by a spate of hostage-takings (of Americans in Tehran, of Aldo Moro in Italy, etc.). Could the West’s collective hysteria, its fraught spectacularization of this terror, have been merely a pathetic attempt to prop up the failing currency of life?

VI. Conclusion
“Symbolic exchange” therefore arises amid a global system of values losing touch with its reals, its others: where money refers only to itself, where signifiers refer only to themselves, where even life can be reproduced from itself. Cloning technology certainly threatens identity, but not half as much as it threatens otherness. The whole symbolic pact, the complementarity, between life and its other, death, is upset. Might the inexchangeable and “transeconomic” figure of the hostage, and the “transpolitical” figure of the hijacker – with an alterity that erupts from outside, or within, the global system of exchange – thus mark a retaliatory condensation of symbolic otherness? For this currency, too, has undergone a crisis.

The Islamic Revolution is perhaps exemplary here in its denial and rejection of the progress – modern, liberal-democratic, emancipatory, technological, in short, Western – that was the guiding metanarrative of both Capitalist and Communist worlds. Here was a nation, fresh from decades of oil-fueled, British- and US-sponsored social and political modernisation, economic growth and “democratic reform”, which apparently wished to turn back the clock, to reverse the irreversible march of progress in favour of an illiberal, theocratic tradition. For Western minds it was – perhaps still is – unthinkable. One popular attempt to think it was Samuel Huntington’s famous and fatuous thesis about a “clash of civilizations”.16 This big-picture theory of international relations holds that the global conflicts of the future will be “not primarily ideological, not primarily economic”, but cultural. This polemic was penned in the defence of defense – the struggle to keep the Pentagon’s annual budget over $300 billion – and was intended to head off the demilitarization supposedly implied by Fukuyama’s end of history.17 Forget the trade deficit – what America was suffering from (since 1989) was an otherness deficit. The Western project of economic liberalism was clearly having trouble making sense of its end zone, casting for an opponent on behalf of its lonely superpower. As the Wall crumbled, the red bogeyman trades his star, hammer and sickle for a crescent, the Koran and a turban (reassuringly, he still has his Kalashnikov). Huntington had to mock up the unreasonable Other-figure (fundamentalism), whilst obfuscating the zealotry of the West’s own democratic fundamentalism. (A further ramification is that the West’s disciplinary responsibilities would be actionable not only on the grounds of territorial and strategic infractions, but also without regard to these, on the grounds of mere cultural infringements – against human rights and individual freedoms, instances of “bad” governance, etc. – offences to the natural democratic order.) Baudrillard, too, was intrigued by primitive societies, by the charge of radical otherness they generate when they confront the Western imagination. But he took up the perspective of these “traditional” cultures, holding out against the juggernaut of Western progress, not out of some multiculturalist sympathy, nor anthropological responsibility, nor post-colonial concern for cultural and biogenetic conservation. (He attacked these postures as condescending objectifications.) For he sought not understanding, but its limits. And he found them – the limits of the political in the primitive strategies of terrorism; the limits of value in its volatilization of life and death; and of economics in its impossible exchange.

About the Author
Dr. David Teh is Adjunct Research Fellow, Centre for Contemporary Art and Politics, College of Fine Arts, Sydney, Australia.

1 – Jean Baudrillard. Revenge of the Crystal. Sydney: Power Institute, 1990:24.

2 – For a thorough account of money’s identity crises, see Jean-Joseph Goux’s “Essay in Theoretical Numismatics”. Chapter 1 of his Symbolic Economies: After Marx and Freud. Translated by Jennifer Curtiss Gage. Ithaca, New York: Cornell University Press, 1990:9-63.

3 – Saussure’s theory, which Baudrillard follows, subjects the sign to a homologous identity crisis. On this homology see Jean-Claude Girardin, “Towards a Politics of Signs: Reading Baudrillard”. Telos 20, Summer 1974:127-137; and Goux’s Symbolic Economies (Ibid).

4 – Susan Wright. Molecular Politics: Developing American and British Regulatory Policy for Genetic Engineering, 1972-1982. Chicago: University of Chicago Press, 1994:49. The category of “design-intensive” industries advanced by Scott Lash and John Urry allows an understanding of scientific research alongside both aesthetic (culture) industries and the aestheticization of economic activity generally…. See Lash and Urry’s Economies of Signs and Space. London, SAGE, 1994.

5 – Both of these groups were connected to the student political scene of which Baudrillard was himself a part. He made much of the latter’s abduction, murder and unceremonious dumping of former Italian Prime Minister Aldo Moro (in 1978). Jean Baudrillard, Revenge of the Crystal. Sydney: Power Institute, 1990:176-178.

6 – Jean Baudrillard. The Spirit of Terrorism. New York: Verso, 2002; first published in Le Monde, 2 November 2001. Baudrillard had theorised the West’s complicity with terrorism in earlier texts see: Revenge of the Crystal. Sydney: Power Institute, 1990:173.

7 – Jean Baudrillard. Revenge of the Crystal. Sydney: Power Institute, 1990:173.

8 – Jean Baudrillard. The Spirit of Terrorism. New York: Verso, 2002. Here and in subsequent references I refer to the translation of Rachel Bloul, circulated on various mailing lists, including the Nettime list, 15/11/01.

9 – See Jean-François Lyotard. The Differend: phrases in dispute. Minneapolis: University of Minnesota Press, Minneapolis, 1988:5.

10 – Jean Baudrillard. Revenge of the Crystal. Sydney: Power Institute, 1990:176.

11 – Jean Baudrillard. Revenge of the Crystal. Sydney: Power Institute, 1990:170-176. Just as Giorgio Agamben’s homo sacer clings to a life that is always already forfeited to the sovereign, so are the hostages’ lives always already forfeited, to the masses they haplessly represent. Giorgio Agamben. Homo Sacer: sovereign power and bare life. Stanford: Stanford University Press, 1998.

12 – On which see John Frow. Time and Commodity Culture. Oxford University Press, 1997:197.

13 – Michel Foucault. The Order of Things: An Archaeology of the Human Sciences. New York: Random House (Vintage re-issue edition), 1970:160.

14 – Thus it becomes “one object of knowledge among others and [therefore] answerable … to all criticism in general.” But at the same time it “resists this critical jurisdiction, which it takes over on its own account and brings to bear, in its own name, on all possible knowledge. So that throughout the nineteenth century, … critical forms of thought and philosophies of life find themselves in a position of reciprocal borrowing and contestation.” Foucault, Ibid.:162.

15 – Cetus Corporation. “Special Report” (unpublished) c.1975; cited by Susan Wright in “The Social Transformation of Recombinant DNA Technology, 1972-1982”. Chapter 2 of Molecular Politics (see endnote 4).

16 – The original statement of this thesis is in Samuel P. Huntington. “The Clash of Civilisations and the Remaking of World Order”. Foreign Affairs, Volume 72, Number 3, Summer 1993.

17 – On the politics of this re-invention of US foreign policy post-1989, see Tariq Ali. The Clash of Fundamentalisms. New York, Verso, 2002:271-284.