1 - Debt, complexity and the sociological imagination

Summary

Introduction

Since the financial crisis of 2007-08 there has been a growing interest within sociology as well as within allied social science disciplines in debt and indebtedness. This has resulted in a range of analyses which, in various ways, attempt to outline the social conditions of indebtedness, that is, to define or map indebtedness in sociological terms. In so doing, such analyses have touched on a range of critical issues including austerity, the expanded powers of financial and banking institutions, and the relationship between the state and financial capital. In this chapter, I will suggest that to date much of the sociological engagement with debt and indebtedness has been limited by a number of issues. This includes a failure to engage with the dynamics of finance and finance markets and especially the long-term and embedded process of the transformation of debt into liquidity. It also includes the operation of the assumption that debt possesses particular properties or capacities in regard to the social, as well as the supposition that debt, particularly household and personal debt, amounts to illiquid and stagnant households. I will outline how such assumptions are compromising the ability of sociologists to identify and engage with the ways money, debt and finance have become deeply embedded in social life and have become central to the dynamics of social formation. This includes class formation – whose dynamics are increasingly based not on occupations but on the dynamics of financial assets and especially their distribution – and the materialisation and dynamics of what I will term here ‘Minskian households’, that is, households which exist in a permanent state of speculation.

This chapter therefore amounts to a call for sociologists to rethink their understandings and engagements with debt and indebtedness and offers a number of points of orientation for the development of a sociology of debt. Following Gane (2015) I will suggest one guiding principle of this development must be an engagement with the technicalities and complexities of money, finance and debt. While such an engagement is by no means straightforward, not least because of the jurisdictional hold that the discipline of economics exerts on this terrain, it is nonetheless a necessity given the centrality of money and finance to the dynamics of the social.