Rated Agency: Investee Politics in a Speculative Age by Michel Feher
Translated by Gregory Elliott, 192 pp, September 2018, £20.00, ISBN: 9781942130123

“Some people don’t like to take responsibility for their own shit, they blame everything in their life on somebody else. Good luck!” With these words former Uber CEO Travis Kalanick left the car. This outburst followed an argument with his Uber driver Fawzi Kamel who had confronted him about the precarious working conditions at the ride hailing company.

For many people, Uber has become the embodiment of what is wrong with contemporary capitalism. Not least for their refusal to treat drivers as employees, which deprives them of the most basic worker protections. Can the ‘Uberisation of everything’ be resisted by doubling down on demands for fair employment conditions?

In his book Rated Agency, Michel Feher seeks to make an intervention in how we address this question. He advocates shifting the critical focus from the relationship between employer and employee, towards investor and investee. In his view, neoliberal reforms set in motion financialisation, but the two shouldn’t be conflated. The initial intention of neoliberal reforms to restore entrepreneurialism in effect enabled the transfer of funds from the ‘real economy’ to the speculative circuits of finance. The ensuing process of financialisation put investors, and more generally the suppliers of credit, into an extraordinarily powerful position. They select the projects that deserve to be financed, they decide ‘what the real economy will comprise’ (p.17). In turn, investees adjust their behaviour, shifting away from profit-maximisation towards portfolio-optimisation.

Feher examines three areas in the analytical chapters of his book: publicly listed companies and the shareholder revolution, states and bond market ratings, and platform capitalism. After setting out the trajectory of financialisation in each area, he argues that the Left’s efforts to scale back financialisation are misguided. Activists should rather contest financialisation in the speculative realm by engaging in counterspeculative activities (p.58). The relentless focus on shareholder value, for example, opens up the possibility to pressure management into action by trying to influence the share price through public shaming. Likewise, Corporate Social Responsibility programmes can be used to hold companies to account. Prominent examples include how activists got the Dakota Access Pipeline defunded, and how shareholders pressured Shell into tying executive pay to carbon emission targets. Financialisation, in this view, can only be resisted by first ceding considerable territory to finance, only to then turn its logic against itself.

This is a controversial claim. Much current criticism of finance on the Left is built on the conviction that we can de-financialise – progressive political visions often express the desire to reinstate pre-financialised conditions. It is Feher’s declared aim to shake the Left out of this nostalgia, to dispel ‘the melancholy of the left’ (p.11). His activist proposals are the main contribution Feher makes to the discussion of financialisation.

Not surprisingly, many reviews of Rated Agency have focused on what the prospects of this kind of activism are. Central challenges certainly include how to coalesce a diverse range of stakeholders to a single issue, and just how progressive alliances can preserve their radical edge and avoid getting priced in by the market.

The solution of counterspeculation follows from a particular way of framing the problem of financialisation. Feher broadly follows the standard narrative of neoliberalism and financialisation. Yet by examining precisely how he defines the problem of financialisation and its history, we can better assess the viability of his solutions.

Feher explains that the Fordist era ended because its model of production was unable to meet changing demands. Mass-production did not meet consumer tastes, and consumerism failed to distract from the social inequalities and shortcomings of the supposedly inclusive welfare state. Eventually, though, it was inflation that enabled the conservative revolution of Thatcher and Reagan. The implementation of the neoliberal policy agenda disempowered organised labour and companies could accommodate better to demands of investors. This is where a new paradigm in management came to fruition, distinguishing between shareholders (principals) and managers (agents) that act on behalf of the shareholders. Through the influence of the Chicago school Law and Economics agenda, managers as agents did not so much focus on the company’s long-term sustainability, but respond solely to the demands of the shareholders as principals. Maximising shareholder value became their true mandate (p.64).

In a similar fashion, tax cuts for corporations implemented by neoliberal politicians deprived the state of tax income that needed to be compensated with borrowing on bond markets. Drawing on Wolfgang Streeck, Feher traces the transformation from ‘welfare state’ to ‘debt state’ to ‘consolidation state’ (p.102-4). Whether it is states borrowing to compensate declining fiscal revenues or citizens taking out more consumer credit in response to declining welfare payments and stagnant wages – the takeaway is that evermore power is held by the suppliers of credit. Feher argues that this becomes apparent when politicians align decisions with the interests of financial capital rather than their voters’, fearing the rising cost of borrowing on bond markets and negative credit ratings. Temporality is key in understanding this: While voters get to decide only every couple of years, investors can react almost immediately to decisions.

Moving from wages to debt, what Feher presumes here is that the debtor is the investee, pretty much constantly at the receiving end of power relations. But what about leveraged economic actors, which through amassing debt exercise a considerable amount of power?

In addition to that, the current low interest environment has rather made it harder for investors to find good returns rather than disempowered debtors. Especially with regard to bond markets, government bonds with negative yields ballooned to $17 trillion this year. In Feher’s version, however, governments remain passive recipients of the structural power of finance.

Given the low yields environment, many look at the platform economy for examples where high Return on Investment is still realised. Feher situates the rise of platforms within the neoliberal paradigm of putting responsibility on the individual. Platforms open up myriad opportunities for self-exploitation, and their expansion is financed by venture capital (VC) funds. He observes that VCs ‘readily understand that devising cost-effective ways to satisfy a hitherto unexpressed demand on a scale large enough to ward off competitors is an endeavour requiring patient shareholders’ (p.192). Investors accept staggering losses as long as their money is spent on scaling the platform’s operations, often to the detriment of substitutable service providers.

This examination of platforms contradicts the point Feher earlier makes about shareholders chasing short-term gains. He emphasises that platforms burn through investor money for a long time before turning a profit. In that sense platforms are wholly reliant on investors’ long-term commitment.

Indeed the ‘burn rate‘ is allegedly interpreted as a good sign by investors, losses are considered an ‘asset’. But if wholly contradictory practices can both be deemed part of an ‘investee logic’ then the concept is tautological. More interesting would have been to examine how particular practices translate into the appreciation or deprecitation of assets and why. Without doing that anything can be deemed part of investee capitalism: Losing money is a good sign, making money is a good sign.

For Feher’s concept of Uberisation to work, you have to presume extremely powerful investors in tech. As mentioned above, this is not necessarily the case. Recent lacklustre IPOs in the sector suggest that massive investments in tech are not necessarily a sign of strength, but rather of desperation in a low interest environment. WeWork is a case in point here, and so to a certain extent is Uber. For activism in this domain to work, we need to break up the monolithic conception of investors. Even within the VC industry there are big differences in investment strategies, each with different implications for potential activist action.

Kamel gave Kalanick a one-star rating for the ride. Understanding the investor-investee relationship as metaphor rather than scrutinising the actual workings of finance risks that activism on the investee side remains just as inconsequential as Kamel’s rating on Uber.


Nils is a PhD student at the Political Economy Research Centre, Goldsmiths.