Shareholder-value austerity harms firms and society while financiers profit from crashes

Evidence

As Ho notes, the price for this culture of liquidity is not merely limited to the woeful fate of individual bankers. An overarching value paradigm is imposed by Wall Street on the rest of the economy, as firms (and also, we might add, governments) are compelled to constantly downsize and do more with less. Ho illustrates that, while financiers lionize their austerity agenda in the name of “shareholder value” and the clients whom they ostensibly represent, it has high long-term costs for both individual firms (and their share prices) and society at large (2009, 122–168). Further, the “strategy of no strategy” and the culture of acceleration and short-term profiteering foment the conditions of over-speculation and mis-evaluation that cause market crashes, although Wall Street long ago learned to profit from these economic disasters (2009, 295–324). — Max Haiven, Cultures of Financialization, 187

Categorization

• XREF: The shareholder-value austerity mechanism is the economic core the reader’s cultural argument (deWaard) builds on — direct precursor. — connects to: Financialization theory links wage-compromise collapse and shareholder value to inequality — Natascha van der Zwan, Making Sense of Financialization, 109; Austerity is economically irrational yet politically rational for preserving capitalism; Monetary austerity deliberately induced recession to discipline workers. — Clara E. Mattei, Escape from Capitalism: An Intervention, 154 (+5 more)

Broader Connections

• Financialization theory links wage-compromise collapse and shareholder value to inequality #expands (0.82) — Natascha van der Zwan, Making Sense of Financialization, 109
• Austerity is a recurring policy suite that entrenches wealth and private primacy #corroborates (0.82) — Clara E. Mattei, The Capital Order, 21
• Austerity was capitalism’s manufactured response to worker challenges #expands (0.80) — Clara E. Mattei, The Capital Order, 585
• Austerity is economically irrational yet politically rational for preserving capitalism #corroborates (0.78)
• Monetary austerity deliberately induced recession to discipline workers. #expands (0.75) — Clara E. Mattei, Escape from Capitalism, 154
• Tax evasion, austerity, and loose monetary policy mutually reinforce each other #corroborates (0.74) — Nick Srnicek, Platform Capitalism, 38
• Finance escaping crisis consequences legitimated the economics profession dodging blame #expands (0.72) — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 583