This article is a revised version of a presentation at the Delhi University symposium on “Globalization, Justice and Democracy,” November 11, 2010.

A common response of the left to the financial crisis that broke out in the USA in 2007-08 was often a kind of Michael Moore-type populist one: Why are you bailing the banks out? Let them go under. This kind of the response was, of course, utterly irresponsible, with no thought given to what would happen to the savings of workers, let alone to the paychecks deposited into their bank accounts, or even to the fact that what was at stake was the roofs over their heads. On the other hand, the even more common response was all about asserting state responsibility: This crisis is the result of the government not having done its duty: governments are supposed to regulate capital, and they didn't do so. But this response was in fact fundamentally misleading. The United States has the most regulated financial system in the world by far if you measure it in terms of the number of statutes on the books, the number of pages of administrative regulation, the amount of time and effort and staff that is engaged in the supervision of the financial system. But that system is organized in such a way as to facilitate the financialization of capitalism, not only in the U.S. itself, but in fact around the world. Without this, the globalization of capitalism in recent decades would not have been possible.  

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