June 15-17, 2023
June 15-17, 2023
HARVARD LAW SCHOOL
Sponsored by: INET; PERI, University of Massachusetts, Amherst; LPE@HLS; APPEAL; Harvard Law School; University of Würzburg
June 15-16, 2023
THE NEW INSTITUTE AND HAMBURG INSTITUTE FOR SOCIAL RESEARCH
Sponsored by: Hamburg Institute for Social Research and THE NEW INSTITUTE; University of Würzburg
The Honourable Mia Amor Mottley, Q.C., M.P.
Prime Minister of Barbados
Saule Omarova, Professor of Law
Cornell Law School
Call for Panel and Independent Paper Proposals
(Deadline: Feb. 01, 2023)
Submit: Panel Proposal or Submit: Independent Paper Proposal
We are delighted to announce Money as a Democratic Medium 2.0. The Conference will be held at two sites in order to maximize participation while minimizing carbon impacts: Cambridge, MA (Harvard Law School, June 15-17, 2023) and Hamburg, Germany (the Hamburg Institute for Social Research and THE NEW INSTITUTE, June 15-16, 2023). The Conference is open to all students of money, credit, and finance, the monetary system, and the modern economy, including members of the public. We will offer robust online access and we encourage distant participants to join us virtually.
The Conference includes opportunities for specialized exchange in panel sessions and plenary events of interest to the broad audience.
- For specialized panel sessions, we welcome proposals by February 1st, 2023. To propose a panel, please submit your proposal using the link provided above or on the conference webpage: https://justmoney.org/money-as-a-democratic-medium-2-0/. Your material should include panel participants, paper abstracts (1-2 pages each), and a confirmed commentator. We will receive independent paper submissions, but their chances of acceptance depend on the vagaries of other submissions. Panels and papers in the areas identified below are particularly encouraged. In addition, there will be limited opportunity for emerging scholars (i.e. undergraduate and graduate students) to workshop with experienced faculty. Dependent on participant interest, zoom “poster board” sessions will also allow participants to share work and receive feedback online.
- Additional plenary sessions will be announced.
- Registration for the Conference will open on March 1st, 2023.
Money has moved to the front and center of debates over democratic governance. In the five years since our first conference (Money as a Democratic Medium 1.0, 2018), scholarship and policy contention in the field have exploded. Money as a Democratic Medium 2.0 takes that development as its focus. The Conference aims to amplify inquiry, research, and debate over money as a public project. The 2023 meeting will bring together those working across disciplines, locales, and subject areas to consider the way societies make money and allocate credit as an essential element in the way they govern themselves.
Recent events compel the focus. Twice over the last two decades, governments world-wide have leapt to rescue the financial infrastructure that undergirds modern markets. The amounts they appropriated, the way they distributed those funds, and the decision-makers who controlled the process – all raised questions about democratic voice and accountability. In the United States alone, officials in 2008 committed more than $5 trillion in lending, guarantees, or financing to firms operating in the capital markets, while individuals who lost homes scrambled for relief. In the COVID-19 pandemic of 2021, the Federal Reserve mobilized the same magnitude of funds at even greater speed to maintain the markets for public bonds, corporate borrowing, and other financial assets. Proactive after the experience of 2008, Congress’s emergency spending still failed to match the Fed’s, even as it faced repeated obstacles, drew the ire of deficit hawks, and triggered blame as the catalyst for inflation. The very character of the monetary architecture seemed skewed to fail the people it was said to serve. In Europe, too, the two global crises significantly changed the structure of government and the economy. The ECB and national banks have since played a significant role in supporting the financial sector with the aim of preventing economic collapse inter alia through large-scale quantitative easing. The pandemic, furthermore, prompted unprecedented fiscal measures, not only at the member state, but also the EU level. Yet, governments stopped short of complementing the monetary with a fiscal union and discontent has been rising about the distributive effects of monetary as well as fiscal policy.
Other phenomena escalate that concern. As the evidence of rising inequality mounts, so do arguments about how monetary drivers, from financial instability to predatory credit structures, may contribute to it. Financialization appears to have taken on a life of its own. On the one hand, the industry continues as a critical interface in the markets. On the other hand, scholars document increased returns to traders without any gains in efficiency or accessibility to most individuals. Stabilizing that sector remains the conventional priority of central banks. At the same time, climate change gains destabilizing force at the existential level, challenging those institutions, legislatures, and the banking industry to turn the power of modern money-making towards the ultimate public welfare. Over the past few years, a new set of institutions and approaches have attempted to promote alignment of the financial system with the Paris Agreement, and to manage climate-related risks to the financial system. Largely untheorized, these new institutions and approaches require discussion as to their strengths and weaknesses.
Each of these issues reverberates globally, joined by an array of other exigencies. Monetary sanctions, for example, carry grave geopolitical ramifications: some see a route around expanding militarized conflict, while others decry the strategy for creating new nation-state blocs. The status of the dollar as the global currency comes in for daily debate; shifts in its hegemony would mean regional realignment across the globe. Meanwhile, the Eurozone’s experiment in monetary governance has wrapped representative institutions, courts, and transnational organizations into novel relations. Residents there and in polities across the globe debate degrees of “monetary sovereignty” as an index of self-determination. That concern is closely tied to rising burdens of sovereign debt, a challenge configured by patterns of early and current colonialism. The phenomenon implicates both international financial organizations and the fractured landscape of debt resolution and restructuring.
The 2023 MDM Conference, like its predecessor in 2018, distinctively frames new work on money, credit, and the financial architecture: it recognizes them as elements of a public project rather than privately produced phenomena. Given that frame, the Conference will focus on the following themes. (1) Issues of institutional design, (2) the fit of that design to democratic governance, and (3) the globalization of monetary structures as a challenge to domestic decision-making.
First, we invite work that opens monetary institutions to view. Comparative and historical work suggests that societies have experimented constantly with different monetary structures and methods of allocating credit. Everyday experience reiterates that lesson. The crises of 2008 and 2020, the rise of cryptocurrencies, the European Monetary Union, recurring sovereign debt crises – all have catalyzed intense debates over institutional reform. The Conference will feature work that enables us to explore more effectively the complex engineering that produces modern money and credit, to evaluate the way our monetary orders have changed and the capacities at stake when they do, and to consider causal connections previously obscured, including the relationships between governmental structures and market processes. The focus will include arguments about forward-looking institutional alternatives, like central bank digital currencies, the political and normative premises that shape them, and their impact on shaping the modern political economy.
Second, the Conference directs attention to the claims that the public rightfully makes on the monetary media organized in its name. Recent scholarship on money details the governmental infrastructure that undergirds most moneys, the public obligation that anchors demand for the medium, and the enforcement and regulatory practices that consolidate the payments system. That public commitment suggests that we have profound legal and political obligations to evaluate monetary design as a matter of democratic governance. But such a mandate arguably collides with the very structure of the modern financial architecture, which insulates central banks to ensure their independence while incorporating significant commercial bank voice into their administration. The intricacy of modern finance compounds the challenge, as does the expansion and important role of expertise in monetary policy, bank management, and financial development. The question remains how members of a monetary community can participate in the way that body operates, how they can claim fair access to the medium, and what structures engender well-being and opportunity, as opposed to dearth and exclusion.
Third, and new in 2023, the Conference will focus on the global dimension of monetary governance. From the dynamics of the Gold Standard to the taper tantrum of 2013 to the crescendo of dollar-denominated sovereign debt that came with COVID, communities worldwide have been tied at the monetary level. “Interdependence” has not meant equal fates. Empire traveled financial trajectories while international financial institutions turn on the capacity and centrality of the global hegemons. Monetary shocks often hit countries with less financial clout harshly, irrespective of their efforts at economic orthodoxy. The EU continues to revise its political alliance through an intensely monetary process. Meanwhile, markets respond more abruptly to the decisions of investors world-wide than the efforts of officials to coordinate. Perhaps most striking, monetary authorities answer to domestic mandates even as their actions create lucrative opportunities or catastrophic impacts abroad.
The 2023 Conference invites work on these themes from any discipline, including law, the social sciences, and humanities broadly construed. Interdisciplinary approaches are welcome.
Conference and Climate
The Conference structure aims to balance the great value of in-person meeting with responsible measures to mitigate the impact of carbon emissions. Our dual locations will enable those participants proximate to Cambridge, MA, and Hamburg to avoid long distance travel. The Cambridge meeting is open to all regional participants to attend in-person along with a limited number of long-distant registrants. At Hamburg we will be able to host approximately 60 participants. The Conference will maximize Zoom and hybrid access for all. Participants choosing to attend online/remotely will enjoy the same opportunities to present their work as in-person participants. We will also do our best to use available technology to integrate and facilitate discussion between remote and in-person participation modes. For in-person participants, we will encourage the use of ground, as opposed to air, travel. Finally, the Conference will be designed to accommodate working groups that normally meet online to make use of conference time and space to gather, maximizing the productivity of in-person meeting.
Specifically, the Conference will include:
- A robust hybrid option – zoom and online interactive capacity
- Cambridge in-person meeting:
- Regional participants (northeastern US) or those proximate for multiple reasons – open registration
- Long-distance participants traveling by air – 60 spaces (parallel capacity as MDM 1.0). These spaces will be allocated on a first-come, first-serve basis, with reservations for organizers, keynotes, plenary speakers, and accepted panelists. Graduate students will be able to register provisionally, as they apply for any required funding.
- Hamburg in-person meeting: 60 spaces
- Subsidized train travel — by application for graduate students and others without institutional support.
- A “layered” conference structure – making space and time available for affiliated working groups. Please notify conference organizers if you would like space set aside for your meeting.
We encourage attention to the following topic areas in specialized or broader sessions:
Financialization and Distribution
At issue here is the distributive impact of financialization, given recent work suggesting that a burgeoning financial sector has failed to increase productivity or exchange efficiency while claiming increasing profits. Observers have also raised concerns about how the existing channels of liquidity support used by central banks may augment the benefits to asset owners, even as they provide necessary relief in crises and ordinary times.
Democratizing Central Banks
The conditions that protect central banks from political manipulation also reduce democratic access to them. Existing channels of accountability depend on functional political oversight, an increasingly tenuous supposition in many nations, not least the fractured American landscape. The complexity of the monetary architecture exacerbates the problem, as does the arcane nature of much economic and financial expertise. In the wake of two crises (remedied, in large part, by copious support for finance with distributive impact that appears to have exacerbated inequality) a growing literature confronts the issue of whether the existing monetary bureaucracy can be justified and/or reformed.
As a recent JustMoney roundtable noted, “the drawn-out COVID-19 shock is fueling an explosion in public and private debt stocks across the national income spectrum. It has disrupted nominally risk-free government debt markets, triggered massive capital flight from vulnerable countries, and sent central banks on an unprecedented asset-shopping spree.” The crisis – and the avalanche of sovereign debt defaults that is likely to follow – revealed an institutional architecture for sovereign debt resolution that is in fragments, following the demise of the norms that earlier controlled the process. The issue is what can or will be constructed in its stead.
Reconceptualizing Money: Public Utility, Mode of Governance, or Constitutional Structure?
Scholars approaching money as a public utility make a strong case for treating money as an integrated resource. Approaching the monetary system as a utility or infrastructural service reframes the government’s obligation to provide access, as well as the regulatory methods that should be applied to commercial banks, while also situating the monetary liberalization agenda that has prevailed in recent decades within a broader context of network, platform, and utility privatization and deregulation. Approaching money as a public utility both resonates with and diverges from understanding it as a mode of governance or matter of constitutional structure. The question here is how these and other approaches shape normative and political assumptions.
Public Banking, Public Purpose Finance, and Sustainable Credit
From a wide variety of angles, scholars are using monetary theory and history to illuminate the government’s unique capacities as a source of credit for socially beneficial projects and/or individual borrowers. State and municipal public banks, for example, could use money creative powers to lend to marginalized borrowers, or to support investments at society-wide levels to innovate in the face of chronic and intractable problems. Related proposals interrogate the possibility that the government, either through its post offices or its central bank, should provide transactional services directly to individuals.
Climate-Related Financial Risk
Central banks and bank supervisors are in the process of developing new frameworks to assess the risks climate change poses to individual financial institutions as well as to financial stability at large. Climate stress testing, climate-related capital requirements, corporate disclosures of climate-related risks, and the NGFS (Network for Greening the Financial System) scenarios underlie many of these efforts. New work analyzes the strengths and limitations of these new developments, the degree to which they incorporate key lessons from the Global Financial Crisis, and more generally, cross-country experience and experimentation in regulatory approaches.
Independent from risk-management, demand has increased for financial institutions to affirmatively contribute to climate mitigation effort. According to arguments for “alignment,” financial institutions should make lending and investment decisions that would help meet science-based targets for decarbonization, including the 2030 goal of 50% [global] emissions reduction. Thus, the commitments taken by members of GFANZ (Global Financial Alliance for Net Zero), a U.N. initiative now representing over $130 trillion in assets under management; new analytical tools like PACTA (Paris Agreement Capital Transition Assessment) and CDP (Carbon Disclosure Project) that help measure a financial institutions’ level of alignment; and debates over incorporating alignment scores into financial regulations, thereby making them binding requirements. More generally, issues here include the broader theoretical frameworks appropriate to anchor arguments for climate alignment, including case studies of the close relationship between industrial and financial policies in successful industrial development, as well as the role of monetary architecture reform in discussions orienting climate-responsive international trade governance.
Central Bank Digital Currencies
New technologies invite central banks to create digital liabilities that could circulate as cash at the retail level. CBDCs could improve access, convenience, and transparency in payments transfer within existing banking structures. More ambitiously, the technology could reach individuals and families currently outside the banking system. The possibility that central banks offer accounts at the retail level may have more profound effects, including disintermediating commercial banks, otherwise changing their role as money creators, shifting channels of surveillance and accountability, and/or mitigating the risk of bank runs.
Race and Money
Scholars are increasingly examining public monetary systems and the private flows of value that they support as terrains that distribute resources, including access, authority, profits, and credit, along racial lines. Black-owned banks in the U.S., for example, appeal to communities resolved on self-determination but work at a continual handicap given their exclusion from networked benefits and the degradation of banking assets that accompanies discrimination in housing. Municipal bond markets are also weighted against underserved communities while channeling investment returns towards wealthier individuals.
Crypto and Virtual Currencies
The virtual world has become a test ground for re-theorizing the nature of money, the meaning and location of governance and law, and the line between money and payments systems. The turn towards stablecoins has increased concerns about the vulnerability of virtual assets to runs, the dangers to unwary investors, the adequacy and proper domain of the existing regulatory system, and the influence of industry on that system.
Recent scholarship on the way that modern monetary forms travelled across the globe identifies them as a vector for imperialism; Britain’s manipulation of India’s entry onto the Gold Standard is only one obvious example. Elsewhere, the financial structure of credit operated systematically to privilege foreign, disproportionately European, investors, while saddling emerging economies with externally denominated debt. Debates today include the question whether it is possible to revise current monetary forms and relations to minimize the advantage of traditional financial centers, whether the architecture is irreparably skewed towards first movers, and/or whether the normative valence of the modern system is itself irreconcilable with de-colonization.
The Political Life of Money
If money is a complex collective enterprise, protean in design possibilities both in practice and conception, then it is fraught with moral significance and rightful claim to the concern of citizens as well as experts. One issue is how and whether transparency in money creation and design would affect governance; another issue is how it might affect or be affected by popular politicization.
Reparations and Monetary Worldbuilding
Creative approaches to finance affect the attainability of reparations. So also does the reframing of money as a public project. One contemporary question is whether transparency about public finance changes popular calculations about societal responsibility and capacity. Another considers ways in which the global monetary architecture, linked as it has been to structuring the relations of colonialism and essential as it remains in maintaining the world they have built, might now be restructured and leveraged as a tool in global causes of justice and redistribution, particularly as regards supporting countries of the Global South in the climate transition.
The Case for / against Commercial Banking
Recognizing banks as agents that create money by public delegation raises a set of essential questions. Why do banks hold that role? What is the evidence that they are experts in their role? And to what ends have they leveraged their position? Has their privilege been vetted and justified at the political level? Do they face any mechanisms holding them accountable to the public?
Modern sovereign moneys have collective roots: the units that circulate represent liabilities spent and received in the name of a group. By the same token, groups can create other currencies, whether at the informal, municipal, sectoral, or regional level. According to their design, such currencies can operate alongside an official currency; they can displace that currency; or they can circulate to different ends, like the support of local business or non-commercial exchange. Complementary currencies offer a set of natural experiments in money design, collective mobilization, and group dynamics.
In response to Russia’s invasion of Ukraine, the ‘West’, and most prominently, the U.S. and EU, announced a slew of sanctions aimed to cripple the Russian economy, and hurt the interests of a select number of its oligarchs. The sanctions, marked most prominently by the goal of cutting off Russian banks from the system of international finance, put the design of the monetary system and its global integration into the spotlight. Issues include how monetary sanctions compare to the traditional economic or trades blockade, how effective they are, how they relate to conventional geopolitical blocs, whom they impact most sharply, and how they might change national and investor calculations about global finance.
U.S. Dollar Hegemony and the Global Rise of China
New developments, often involving China, have led to questions about the future of the U.S. dollar’s status as global reserve currency, as well as to broader reconsideration of the relationship between monetary and political hegemony. One issue is what impact, if any, China’s outward direct foreign investment practices in the Global South, including the Belt and Road initiative, will have on the role of the International Monetary Fund, World Bank, and similar institutions associated with ‘Western’ orthodoxy and invasive conditionality. Another concerns the potential risks a notoriously opaque and precarious Chinese financial system and its fleet of State-Owned Enterprises might pose to the global economy, particularly as domestic developments paint a picture of increasing authoritarian consolidation.
Over the past decade, a hundred flowers have bloomed in the study of money, banking, and finance as a variety of new technologies, techniques, sources, and approaches have multiplied the number of questions productively asked of money, shedding new light on its actual and potential forms and roles in societies throughout space and history. Among these are mappings and analyses of payment networks, experiments in currency design, new archival discoveries, and novel theoretical interpretations of older narratives — how can these diverse research agendas be put productively into conversation with one another? What can novel approaches add to our collective understanding of the issues of focus?
Susan J. Smith, ALM
Faculty Assistant to Professor Christine Desan
Harvard Law School