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Mapping the cultural grammar


of reflexivity: the case of the
Enron scandal
Galit Ailon
Published online: 19 Feb 2011.

To cite this article: Galit Ailon (2011) Mapping the cultural grammar of reflexivity:
the case of the Enron scandal, Economy and Society, 40:1, 141-166, DOI:
10.1080/03085147.2011.529331
To link to this article: http://dx.doi.org/10.1080/03085147.2011.529331

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Mapping the cultural


grammar of reflexivity: the
case of the Enron scandal
Galit Ailon

Abstract
Theorists of political economy, institutional sociology and late modernity have
recently embraced reflexivity as a pivotal concept in their accounts of change in
capitalist society and institutions. Despite significant differences between them,
these theorists jointly promote an image of reflexivity as a culturally unstructured or
disembedded reflection upon problematized conventions and beliefs. The paper
turns this joint theoretical image into an empirical question. Focusing on the
reflexive discourse sparked by the Enron scandal, it offers a grounded analysis
of Enron-related articles published in the popular American BusinessWeek in
19972007. The analysis examines the rise and fall of the Enron icon and the
sense-making process that followed its bankruptcy which, at that time, was the
biggest in history. It shows that reflexivity had an underlying cultural grammar that
paralleled that pertaining to the management of money. Its four primary principles
were: minimizing costs entailing loss of discursive status or persuasive effect;
maximizing the use-value of a core truism; quantitatively cueing morality; and
conducting discursive competitions. Capitalist reflexivity, the case study proposes, is
based on an underlying grammar cast in the shape of its own beliefs.
Keywords: reflexivity; Enron; capitalist culture; financial scandals.

If the vast literature on the development of capitalism has one theme in


common it is this: capitalism has a transformative sensitivity to its own crises
and failures. A variety of relatively recent streams of theorizing about political
economy (e.g. Leyshon, French, Thrift, Crewe & Webb, 2005; Thrift 2005),
institutional sociology (e.g. Berk & Schneiberg, 2005; Sabel & Zeitlin, 1997;
Galit Ailon, Department of Sociology and Anthropology, Bar-Ilan University, Ramat-Gan,
Israel. E-mail: ailonsg@mail.biu.ac.il
Copyright # 2011 Taylor & Francis
ISSN 0308-5147 print/1469-5766 online
DOI: 10.1080/03085147.2011.529331

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Stark, 1996) and late-modernity (e.g. Beck, 1992; Giddens, 1994; Lash, 1994a)
have identified reflexivity as pivotal in this regard, referring to it as a process
involving self-reflection upon problematized beliefs or knowledge limitations
and attempts to revise them. Despite significant differences between the
streams, they promote a joint theoretical image of reflexivity as a discourse1
that is culturally and institutionally unstructured, representing a look from an
abstract or disembedded outside upon conventional ways of conceiving the
provisions and practices of the capitalist world.
The paper turns this joint theoretical image into an empirical question.
Using an interpretative approach, it offers a longitudinal analysis of a decadelong reflexive sense-making process that unfolded in a popular American
business media outlet. Its findings indicate the existence of an underlying
cultural grammar of reflexivity: a group of principles structuring its unfolding
dynamics and standing at the basis of its logic. The case study thus suggests
that reflexivity does not represent a look from a disembedded cultural
outside. Rather, it is premised upon a structured movement that is capitalist
in the deepest cultural sense of the word, managing beliefs with the same
underlying grammar pertaining to the management of money.
The reflexive discourse under analysis unfolded in the widely-read
American BusinessWeek magazine in relation to the Enron scandal. Once a
prime icon of New Economy rigour and an exemplary prototype of postderegulation entrepreneurship, Enron was a fast-growing energy trading firm
that thrived alongside the American public faith in the free market. It collapsed
in 2001 after some of its accounting manoeuvres were revealed as questionable.
Its bankruptcy, then the largest in history, and first in a series of corporate
financial scandals, constituted a capitalist failing at a time of seeming triumph,
a failing in its own terms and by its own momentum. It gave rise to a long
discursive shock which drew attention to financial and business knowledge
limitations and contradictions. The Enron discourse thus offers an opportunity to explore some of capitalisms modes of self-reflecting upon truth failures
and problematized beliefs and of coping with and revising them.

Capitalist reflexivity from three theoretical angles


As claimed, different theorists of capitalism and capitalist society have placed
reflexivity under the spotlight. These theorists are jointly concerned with
explaining change, but they do so from distinct theoretical vantage points. In
what follows, I discuss both the theoretical role that the theorists ascribe to
reflexivity and the lacuna that jointly besets their conceptualizations.
The first group of theorists is concerned with the new political economy
and belongs to a stream of thinking that focuses on the constitutive role of
knowledge within modern economies (virtualism; see Carrier & Miller, 1998).
According to such theorists, contemporary times mark the extension and
acceleration of a process identified by Polanyi (1957) as the abstract

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disembedding of economic activities from other spheres of action (Carrier,


1998, p. 2). As a consequence of various developments, notably the growing
cultural circuit of capitalism (Thrift, 2005) and, within it, the critiques and
economic spectacles circulated by the media (e.g. Clark, Thrift & Tickell,
2004; Leyshon et al., 2005; Thrift, 2005), capitalism has become increasingly
caught in virtual webs of meaning that are constitutive of (rather than merely
reflective of) the economic world. In this sphere of virtualism, it continues its
historically unending process of resolving the contradictions that are intrinsic
to its culture (Miller, 1998, 190). Indeed, according to some researchers, this
process of resolving contradictions is to a great extent intensified in the current
era. Facing constant pressure of crises and unexpected events, capitalisms
virtual phase is characterized by continuous self-reflections and revisions of
practical knowledge (e.g. Leyshon et al., 2005; Thrift, 2005).
These theorists thus view reflexivity as a mark of a growing cultural focus
on the ideational realm of abstraction. At the same time, some also promote an
image of it as involving an innate and intensified ability to ascend discursively
above this realm, to engage in what Thrift describes as a process of continual
critique of capitalism, a feedback loop which is intended to keep capitalism
surfing along the edge of its own contradictions (2005, p. 6). Thus, while the
reflexive preoccupation with knowledge is taken to be culturally encouraged,
its essence is also seen to be somehow culturally detached, representing an
innate critical ability to stay reflectively on top of the cultural flow, constantly
to pull capitalism up above itself.
Institution-change theorists have also brought reflexivity into the limelight.
Working to further the understanding of how crises, failures or environmental
shifts lead to institutional change, several writers have presented reflexivity as
a missing link (e.g. Berk & Schneiberg, 2005; Sabel & Zeitlin 1997; Stark
1996). Reflexivity, they indicate, overcomes a divide between an economistic
theoretical focus upon agents calculations within constraints and a politicocultural focus upon the strategic enactment of taken-for-granted understandings. The concept contributes to institutional-change theory an
acknowledgement that agents who face unexpected circumstances have the
capacity to reflect collectively on background conditions, discover and
experiment with alternatives, deliberate about their consequences, and then
revise those conditions (Berk & Schneiberg, 2005, p. 49). Change in capitalist
institutions is accordingly seen to result from a reflexivity born by and
expressed in relation to institutional heterogeneity, ambiguity and path
variety: a reflexivity residing in the space between institutionalized
alternatives. In other words, this conceptualization of reflexivity promotes a
theoretical image of it as a phenomenon that is creatively formulated by
agents in the interstices of institutions, leading to change through a thought
process that lacks a structured path or a preordained normative or
instrumental calculus.
Late-modernity theory is another stream of thinking to have placed
reflexivity under the limelight. Writers of this stream have argued that

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various developments in capitalism  namely, its victories and industrial


achievements (Beck 1992), its expansion and global interconnectedness
(Giddens 1994) and its increasing institutional disorganization (Lash
1994b)  have given rise to reflexive modernization. This jointly embraced
term should not be confused with unitary theoretical meaning. For
Beck (1992), reflexivity originates from a quasi-autonomous social selfconfrontation with the unintended risks of industrialization, one which makes
the limitations of traditional institutions and beliefs evident and thus available
for critique. For Giddens (e.g. 1990, 1994) reflexivity is something that
advanced modernization enables (not forces) through its expert systems of
knowledge. In his account, these systems induce an intensified self-reflection
upon social conventions which functions to detraditionalize them. And Lash
(1994a) links reflexivity to the new communication structure typical of
production and consumption contexts, as well as to the increased centrality
of cultural institutions such as the media (1994b, p. 208). Critical of Becks and
Giddenss cognitive focus, he speaks of aesthetic reflexivity and hermeneutic
reflexivity: the former is born by the flow of mimetic symbols and functions
incessantly to deconstruct social structures from a particularist and contingent
position empty of cultural depth. The latter is marked by an increased
tendency for self-interpretation of shared meanings and is issued from the
groundless ground of reflexive communities (1994a, p. 168).
Theorists of late modernity thus posit reflexivity as the cultural mark and
the chief engine of the institutional movements that constitute late
modernity. The actual substance of the critique and self-interpretation
that constitute it is nevertheless rendered institutionally liberated (Beck,
Giddens), empty of cultural depth (Lash) or resting upon a groundless
ground (Lash). In all these ways, reflexivity is cast as a reflective
phenomenon which lacks a deeply ingrained cultural imprint; a reflective
phenomenon freely, contingently or groundlessly deconstructing contemporary structures and conventions.
Thus, writers from three distinct theoretical streams have embraced
reflexivity as a core concept. Generally, their treatments of reflexivity share
two paradoxical commonalities. First, all of them are primarily concerned with
understanding the relationship between reflexivity and the culture and
institutions of capitalist society. Thus they pose reflexivity as a primary motor
of change, especially in contemporary times. Second, the theorists also
promote an image of reflexivity as a discourse that is somehow beyond culture
and institutions: a reflective process that is perhaps culturally encouraged but
also culturally unstructured, representing a detached, deconstructive observation upon the conventions and provisions of the capitalist world.
Theorists from all three streams have not actually put this image to an
empirical test. They illustrated reflexivity by assembling evidence for the
cultural jolts that constituted its points of origin (unexpected events, crises,
trends, etc.) and the knowledge revisions that constituted their end products.
Since reflexivity is defined by all theoretical streams as a process, accounts of its

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points of origin or end products cannot sustain the joint image of it as a


culturally unstructured or disembedded reflection. Given the theoretical
emphases on the contemporary importance of capitalist reflexivity, there seems
to be a need to undertake methodical inquiries into actual reflexive processes,
to explore their evolution as a means of examining their patterns and dynamics.
Undertaking such an inquiry, the study explores reflexivity within the
broader capitalist cultural field. As writers from both the virtualism and the
late-modernity streams of thought have noted, the popular media (e.g. Lash
1994b), and especially their managerial and business outlets (e.g. Clark et al.,
2004; Thrift, 2005), play a central role in constructing and disseminating
capitalist beliefs and knowledge, thus constituting an optimal site in this regard.
Institutional-change theorists, too, offer justifications for choosing popular
media as a site of inquiry into the cultural underpinning of capitalist reflexivity.
Thus, theorists marked public discourse as a primary site for exploring
processes of embedding/re-embedding of market institutions (Somers & Block,
2005), and argued for the need to take ideas and discourse seriously and
unravel the meta-level collective discursive logic which enables agents to reflect
critically upon their institutions (Schmidt, 2008, pp. 322, 310).
This researchs case study is the reflexive discourse sparked by the Enron
scandal in the leading American magazine BusinessWeek,2 a weekly trade
publication of McGraw-Hill. Distributed to a huge worldwide audience of
nearly five million,3 it is arguably the most powerful business magazine in the
world (Salak, 2003, p. 67). With a large editorial staff located in its New York
headquarters and a majority of correspondents located in news bureaus across
the US,4 it represents a core segment of the American business-oriented
mainstream and its take on contemporary capitalism and the global markets.
Characterized by a broad economic focus, it offers business, managerial and
financial news and analyses. Its role in developing New Economy thinking has
been especially prominent (Henwood, 2005, pp. 7, 32). BusinessWeeks broad
economic focus, centrality, explicit capitalist commitment and week-by-week
coverage turn it into an optimal site within which to track an evolving and
popular stream of capitalist reflexivity. Future research will hopefully map
out other variants of reflexivity by examining other outlets and sites of reflection.

The Enron scandal


During the last decades of the twentieth century, the American publics faith in
the market thrived. In contrast with the post-war belief in the need for
government to regulate market forces, markets were increasingly trusted as
self-regulating mechanisms that, if set free, were more capable of advancing
prosperity and wellbeing than any governmental apparatus. A set of neoliberal
principles designed to disembed business and exchange from public regulation
(deregulation) progressively became accepted wisdom (e.g. Harvey, 2005;
Stiglitz, 2003). As the twentieth century approached its end, faith in the

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market grew increasingly optimistic and engulfed American culture writ large.
In the 1990s writers and reporters announced a new economy and claimed
that advanced communication technologies were revolutionizing production
and democratizing the market, overcoming entrenched elite privileges and
promising creative new opportunities for making money (Frank, 2000;
Henwood, 2005; Thrift, 2001).
Enron was a celebrated emblem of this triumphant free-market faith.
Founded in 1985 as a natural-gas pipeline company, it evolved into an energy
trading firm that bought and sold not only gas but also electricity, that
ventured abroad to build power plants and utilities and that eventually became
a dot-com, trading commodities online. In 2000 its revenues reached $101
billion, making it the seventh-largest company in the US and an exemplary
specimen of New Economy thinking throughout the world. Like McDonaldization and Disneyfication, Enronization [was] at the center of the new
global economy (Boje, Rosile, Durant & Luhman, 2004, p. 766). During its
years of growth, the company spent millions on lobbying in order to receive
assistance for advancing projects abroad and furthering energy deregulation,
and its chairman, Kenneth Lay, was called upon to take part in policy task
forces (Fox, 2003; Stiglitz, 2003).
To help sustain its growth and prop up stock prices, the company hid losses
and shuffled debts through complex accounting procedures. Many of these
procedures, it should be noted, were within the wide, deregulated American
legal bounds, and actually quite standard in the 1990s (Stiglitz, 2003).
Additionally, the company was among the suppliers and traders involved in
Californias electricity crisis in 20001. The crisis, precipitated by the
deregulation of the states electricity market, involved overpriced power and
blackouts (see Fox, 2003; Stiglitz, 2003).
In the end of 2001, at the height of the Californian crisis, Enrons stock price
tumbled and its financial manoeuvres were exposed. As the Securities and
Exchange Commission (SEC) began investigating the companys records,
employees of Arthur Andersen, Enrons auditor, shredded relevant documents.
The accounting firm was consequently indicted by the Justice Department and
collapsed. Enron went bankrupt in December 2001 and its bankruptcy was, then,
the largest in history. The years since the bankruptcy have involved a series of
trials and legal hearings, including those which eventually led to the criminal
conviction in 2006 of Enrons former CEOs  Kenneth Lay and Jeffrey Skilling 
on counts of fraud, conspiracy and related charges.
The revelations and legal dramas unfolded gradually, over the course of
years. It was a megaspectacle (Boje et al., 2004); a long-lasting media
sensation that rocked America (Stiglitz, 2003, p. xlii). So much of the last
twenty years come together in the Enron story, writes Henwood, deregulation, financialization, post materiality fantasies, the links between capital and
the state, the increased role of the stock market in the running of big
corporations, and professional corruption . . . Enron would be read as the
demise not just of one firm, but of an entire economic model (2005, p. 33).

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As the details of Enron story were revealed there was some space  there is
always some space  for determining what they mean, how they impinge upon
existing convictions, what lessons should be drawn from them. Since this was
not a one-shot event but an ongoing spectacle, the reflexive sense-making
process was a gradual project, constantly checked against itself by the sequence
of discoveries and the stream of corporate scandals that followed Enron. What
were the elements of this process? What type of sense-making, criticisms and
reflections did they incite? What were the dynamics of reflexivity that the
Enron scandal set in motion?

The process of analysis


This study is based on an interpretative analysis. It seeks to unravel the
ordering principles of an evolving reflexive content. Since reflexivity concerns
a process of self-reflection and knowledge revision, the study applies a
longitudinal perspective and explores the discursive movement along a
primary trajectory of reflection across time (the Enron scandal).5 Data
includes all articles containing the word Enron which were published by
BusinessWeek in January 1997May 2007 and selected by a search engine from
electronic databases. Approximately one thousand articles, ranging from short
reports to cover stories, were thus selected by a search engine.6
Interpretation was premised upon an inductive logic and based on a process
of emergent coding. Originating from grounded theory (Glaser & Strauss,
1967), its methodological strategy was adapted to the research question at
hand, in accordance with the more contemporary approach of emergent
methods (Hesse-Biber & Leavy, 2008). Primarily, the interpretative analysis
was based upon two major sets of codes, one characterizing the substantive
content and the other characterizing the evolution  the flow  of the sensemaking process.
Specifically, the process of interpretation consisted of four stages. The first
included reading and substantive coding. In the second stage I summarized
each article, rechecked and elaborated the substantive codes and noted their
recurrence and centrality. Seeking to track the flow of meaning, I further coded
the discursive evolution both within the articles and between them, noting, for
example, a development of a previously introduced distinction, a moral flip in
the construction of managerial figures, a transition from doubt to certainty and
so on.
The third stage was marked by the move from the textual details to the
comprehensive interpretative outlook, whereby I eventually formulated the
four interpretative frames concerning the grammar of reflexivity. In this
stage I opened computer files for the major substantive codes, pasted into them
the relevant citations and undertook a classificatory analysis of their underlying
themes. Additionally, I mapped out the discursive evolution codes chronologically. The twin focus on thematic characteristics and dynamics of flow

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enabled me to track down and compare the development of the different


themes across time, to identify repetitive tendencies and, thus, eventually, to
map out patterns in the evolution of the content.
Finally, once the four interpretative frames were formulated, I rescanned the
articles for each separately, searching for examples, counter-examples, nuance
and exceptions. Rescannings enabled the rechecking and developing of the
frames, in order to ensure precision in capturing intricacy.
In light of contemporary post-structuralist sensitivities, it is important to
stress that, as is always the case, research constitutes an interpretative reading
of data in relation to which more possibilities of meaning await. To help
evaluate my interpretation, the exposition of the findings will be accompanied
by a profusion of illustrations: every interpretative statement will be directly
illustrated and, as an aggregate, the illustrations will not only speak to distinct
interpretative statements but also to the interpretative framework as a
whole.

Findings
This section consists of two parts. The first traces the history of the Enron
icon: its initial fame and the events leading to its re-iconization as a symbol of
corruption and evil. This part is designed to contextualize the reflexive debate
that ensued from the bankruptcy onwards. Focusing on this debate, the second
part discusses the grammatical principles expressed through its evolution.

The Enron icon


In 19972000 BusinessWeeks coverage of Enron posed the company as a New
Economy icon. Starring in the journals best-lists (e.g. The 50 best performers
[27 March 2000]), Enrons managers were posed as missionaries committed to
advancing deregulation and the free-market agenda (e.g. 9 June 1997),
exemplary incarnations of New Economy entrepreneurial spirit (e.g. 10
January 2000) and pioneers of web technology ingenuity (e.g. 18 September
2000a). Enchantment with the cutting-edge energy powerhouse (10 January
2000) was especially evident in 2000. It was stylistically expressed and bolstered
through glib phrases which included wordplay (Skilling has taken Enrons skills
to the net (15 May 2000)), wittiness (By creating the financial tools . . . Skilling
has boosted Enrons revenues tenfold . . . Plug in the Web, and the mixture
becomes, well, electric [24 July 2000]) and economic cliches (transforming
inspiration and new resources into gold [18 September 2000b]). Though not all
went smoothly for Enron during this time, criticism against it was usually cast as
doubtful: Yet some question whether Enron is moving too fast to get it all right,
stated for example an article titled Enron electrified (24 July 2000) after six
enthusiastic paragraphs. Citing a competitor who claimed that Skillings

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projection about the US bandwidth market was exaggerated, the article


immediately stated: That sounds sweetly familiar to Enron execs. When they
started trading electricity six years ago, naysayers warned it would never be
bought and sold like gas. Now it is.
A slightly more critical stance was nevertheless adopted in relation to
persistent protests about overpriced power provided by Enrons Dabhol plant in
India. Here, it was admitted that Enron was suffering from a distinct whiff of
controversy and that it may need to learn new lessons (24 May 1999), but
blame was generally attributed to an unstable Indian political system and
immature economy. When overpriced power struck the deregulated California
market, deregulation itself came under a public attack. Consumers rage
mounted a challenge to the core belief that unfettered markets work in the
best interest of both producers and consumers, as well as to deregulation plans in
other states (12 February 2001a). Now that the distinction between India and
us had collapsed, new distinctions were introduced to explain the problems
with deregulation. One distinction was between the short and long run, the
argument being that the problems are temporal and deregulation ultimately
helps (28 August 2000). Another was between full and partial deregulation. The
problem with California was not that it deregulated, but that it did not
deregulate enough (e.g. 12 February 2001a) or did not deregulate carefully
enough (12 February 2001b): it was a problem with inept policy-makers, not
with deregulation.
Enron garnered no . . . accolades from Californias great deregulation
experiment: making huge profits during this time, consumers accused it of
profiteering and market manipulation, a fact acknowledged in a BusinessWeek
cover story titled Power play (12 February 2001a). Nevertheless, as it still
bore the numeric honorary tokens marking rises in the figures of success
(sales, stock prices, etc.), it was said to deserve the benefit of the doubt
(12 February 2001a).
Yet Enrons trouble in California heightened throughout the summer of
2001 (Fox, 2003). With the Californian consumers anger on the rise, a pie was
thrown at Skilling; the Federal Energy Regulatory Commission imposed price
caps on electricity, forcing a price drop which apparently set off the sharp stock
fall that ensued; and Enron was cited for contempt by a California Senate
committee investigating possible price-gouging.
However, it was not until November that an Enron Debacle was announced
in a BusinessWeek article bearing that name (12 November 2001). Though
briefly mentioned, this debacle announcement did not focus on California, but
on two accounting events which occurred in October: Enron took a $1.2 billion
charge related to various write-offs, including ones concerned with off-balancesheet partnerships (LJM) managed by its CFO Fastow; and the SEC began
investigating the companys disclosure of partnerships. It should be noted
that charges relating to off-balance-sheet partnerships and a SEC probe
were perhaps problematic, but not unique: many companies managed such
partnerships and were under a probe. Alongside the focus on these events as a

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debacle, attention shifted from Californias consumers anger to a new concept


of investors anger:

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The deals were first revealed in a 1999 proxy, raising concerns from investors
and analysts. By this summer, when Enrons stock was falling and its bets in
broadband were souring, complaints about LJM grew louder. So in June, Fastow
pulled out of the partnerships. When the write-offs came, Enron enraged
analysts and investors further by failing to disclose the hit to equity in its thirdquarter earnings press release. Instead, Lay mentioned it in a conference call
with analysts. (12 November 2001)

Retroactively narrated to construct a sense of intensification, investors anger


at the partnerships was posed as building momentum since 1999. Note that,
while the stock fall and the broadband failure were integrated into this anger
narrative, the Californian crisis was not. Anger was thus redirected to a new
path: one originating not from consumers but from investors and directed not
at the deregulated market but at a specific company. On this path, the gist of
BusinessWeek articles changed from defence to offence, from struggling to
explain the deregulation debacle to piecing together the elements of the Enron
debacle. Accordingly, that November article was marked by a turn to the
negative rhetoric visible thereafter.7 Enrons once idealized operations were
now described as the often Byzantine trading business or the calamitous
foray into the water business. Its star executives were portrayed as aggressive,
even arrogant managers and its visions as grandiose.
Now on the offensive, BusinessWeek writers further broadened the targets of
attack to include not only Enron  the allegedly deviant market actor  but also
the financial professions that did not stop it. How did one of the biggest
companies on the New York Stock Exchange manage to inflate its earnings by
20% . . .? asked an editorial titled End the numbers game (26 November
2001). It answered: In part, blame the breakdown of standardized accounting
rules and the anarchy that runs rampant in the financial statements of
Corporate America. The notion of a numbers game was already laid out in a
May cover-story (14 May 2001), but now that it was linked to the re-iconized
Enron it was about to give rise to what may be titled a full-blown hysteria. The
notion that numbers could be manoeuvred to look like other numbers  that
the economic real itself can be produced and authorized by financial
professionals  challenged one of the most vital symbolic foundations of the
system as a whole. Thus we reach the point of bankruptcy.

The grammar of reflexivity


The post-bankruptcy discourse was a voluminous discourse which reflexively
examined topics such as accounting, corporate governance and financial
institutions. In what follows I explicate the four most salient grammatical
principles underlying its dynamic evolution.

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Minimizing discursive costs

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The examined discourse seemed oriented, however unwittingly, to reducing


discursive costs, to minimizing the surrender of truths entailing loss in
discursive status or persuasive effect. The two most evident costs thus reduced
were market blame and reform concessions.

Minimizing the blame of the market The BusinessWeek articles were primarily
preoccupied with the task of assigning blame for the Enron debacle to various
actors and institutions  executives, accountants, analysts, banks and others.
Indeed, blame attributions constituted one of their central thematic underpinnings (see Boje & Rosile, 2002).8 Nevertheless, underlying the stream of
blame attributions was a market-blame minimizing impulse: if the declaration of
an Enron debacle directed anger away from deregulation and the free market
towards a single, supposedly deviant market actor, then reports of the
bankruptcy basically exonerated the market from any fault, blocking the neoliberal core from the reflexive process. The post-bankruptcy portrayal posed
Enrons managers as deviants who committed serious offenses against todays
Information Economy (26 August 2002a). Thus, the economy was posed not as
a cause but as a casualty, a prime victim of Enron. The alleged lack of innocence
of the deviants (Enrons managers and their professional accomplices) was used
to assert the innocence of the capitalist market. For example:
Capitalism works only when it is played on a level field. The essence of efficient
markets . . . is transparency . . . Enron management and its auditor, Arthur
Andersen, didnt play by the rules that define a market economy. And they were
allowed to get away with it for years. The great tragedy is that if the system had
worked as it should have, Enron would still be in business . . . No one would
ever have noticed if the auditors, outside directors, and regulators had done the
right thing. It all would just have worked the way it was supposed to  and that
would have been the real tribute to capitalism.
(28 January 2002b)9

Note how the attributions of blame to specific wrongdoers and to general


professional oversight  to a specific player from inside the market and to the
guardians standing outside it  are used to exonerate the market itself from any
fault. With blame thus internally compressed and externally diffused, the
capitalist market and its idealizing apparatuses were made immune to reflexivity.
They were rendered a purity impaired, an innocence criminally assaulted.
While sustained throughout the period under analysis, the compression of
blame to the alleged corporate deviants was haunted by two tensions. First,
within the deregulated bounds of the 1990s, it lacked a decisive legal anchor.
The accounting techniques associated with Enron, it was generally realized,
conformed to the letter of the law. Enrons execs got approval from their
boards of directors and accountants for most of their actions, and their

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financing and accounting techniques . . . may not rise to the level needed to
put the executives in jail (26 August 2002a).
The sense of criminality nevertheless withstood this lack of clear legal
culpability. It was sustained by two interrelated elements. One was the
tendency to pose the market not only as Enrons ultimate victim, but also as
Enrons ultimate judge, and to construe bankruptcy as its judgement. The
basic rationale was that Enron was hyped (10 December 2001b) to appear
innocent and successful but the market was able to see and reveal its true
nature through the lost faith (10 December 2001a) of investors and
customers. Since the outcome  bankruptcy  was seen to expose the truth
about Enron, all that made the company seem innocent and successful before,
including the apparent legality of its actions, was, according to this logic,
scandalously designed to hide the truth. Enrons managers committed the sin
of shamelessly promoting [Enrons] image (18 March 2002). They hid the
companys true nature with sophisticated accounting mirages (25 February
2002e). In effect, there has to be an implicit moral contract to make the New
Economy work, one article construed the meaning of the market-sentencing,
and Enron violated that contract (20 May 2002). In other words, what
Enrons managers did was perhaps technically legal but immoral, violating
some higher, retroactively defined law. They had the most obsessive and
careful concern for the letter of the law, but they sacrificed the spirit (12
June 2006b). Backed by a notion of a clear market judgement, the sense of
criminality was sustained alongside the acknowledged legal ambiguities.
Additionally, the sense of criminality was sustained narratively. Several
textual elements gave rise to a sense of criminal plot. Most evident was the
characterization of Enrons managers: for example, describing CFO Fastow, an
article claimed that insiders saw him as sometimes volatile and vindictive, that
he had a screaming, table-pounding style, that he could also turn on the
charm and that Fastows spokesman denies that he ever threatened bankers to
get them into Enrons deals (4 February 2002c). Similarly, Kenneth Lay was
first compared to Mr Ponzi the infamous financial schemer (e.g. 11 February
2002b), and later recast as a weak, even spineless manager . . . [who] made no
real effort to control Skilling and his kamikaze minions as they gamed energy
markets and US accounting laws (6 February 2006). Such characterizations
were complemented with cynical public-shaming displays, such as a proposed
annual Enron Award . . . nicknamed the Kenny Boy (after Ken Lay) that
will go to the company whose actions did the most to undermine capitalism
and free markets in the preceding year (20 May 2002). And to complement
this sense of a criminal plot filled with crooks and a sense of justice-revealedafter-all, there was also a helpless whistleblower who had seen it all in the
making, was powerless to make the bad guys stop, but would nevertheless be
called upon to make them pay:
One of the few heroes to emerge from this sordid case is Sherron Watkins, an
Enron finance executive who wrote a letter in August to Chairman and CEO

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Kenneth L. Lay that laid out in amazing detail the companys accounting tricks.
Her letter, since made public, shows that Lay knew far more about misdeeds at
the company than he has admitted.
(28 January 2002a)

The compressed blame construct  narrowed down to the realm of a single


market actor  was haunted not only by a sense of legal inconclusiveness, but
also by a second tension: the fact that Enron was hardly the sole villain in the
market. Enron was far from last in a string of corporate scandals, and these
scandals threatened to undermine the sense of its deviancy. Until the WorldCom
scandal erupted in summer 2002, evolving into an even bigger bankruptcy
than Enron, the sense of Enrons deviancy rested on the notion of its being a
scandal . . . unprecedented in scope (25 February 2002a). Additionally, there
was a tendency to pose Enron as the cause of the stock falls that occurred after its
bankruptcy: Enron was a source of an epidemic, sometimes titled Enronitis
(e.g. 11 February 2002a), expressed in the angst of investors who fled the market
because of doubts about the quality of corporate earnings.
By the time WorldCom fell, however, the sense of Enrons unprecedented
scope was shattered and the notion of unique deviance could no longer be
sustained. In his Fourth of July speech, President Bush spoke of a few bad
apples, and BusinessWeek reporters disagreed. The scandal-a-day environment [is] rapidly turning those now infamous few bad apples into a full
orchard, one of them, for example, stated (26 August 2002b).
Nevertheless, Fastows indictment the following fall resanctioned the notion
of a few bad apples, and the sense of Enrons uniqueness was restored. Now,
however, it was broadened to include WorldCom as well. It was the year
Enron set new lows in corporate ethics, stated a January article, while
WorldCom broke records for the size of its bankruptcy (13 January 2003).
With each indictment and trial that followed, the bad apples paradoxically
seemed fewer: the lone deviants exonerated the system as a whole. After
Skilling and Lay were declared guilty by their juries, claims such as the
following were rendered sensible once again: if there is one thing the
corporate scandals have shown us, its that bad behavior is actually pretty rare
(12 June 2006a) Thus, while a source of much preoccupation, the tensions
haunting the compressed blame construct were discursively managed
throughout the period under analysis.
Minimizing reform concessions As claimed, the target of BusinessWeeks criticism
concerned not only the Enron debacle, but also the financial anarchy.
Discussions of this anarchy included many calls for reform. Nonetheless,
these calls were structured in a way which laid foundations for eventually
minimizing reforms by rationalizing reform reversals and withdrawals.
The structuring of the reform subdiscourses consisted of two basic
elements. First, calls for reform were explicitly not directed at the market.
The market, articles stated, was fixing itself much more efficiently than any

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potential reform. Readers were assured that there is a sweeping and


preemptive move on the part of businesses to rethink their relationship with
auditors well ahead of any government action (8 April 2002). Or: In America,
an enormous cleansing has already started . . . The market is recalibrating,
sending capital to companies with transparent, easy-to-understand financial
statements while causing the rest to tank (8 July 2002).
This should not imply that problems were not acknowledged. There was
talk of problems, most, as I discuss in the next section, in terms of conflicts of
interests. Nonetheless, articles promoting reform did not focus on fixing
the market but on fixing investors trust in the market (e.g. 10 June 2002).
Some 100 million investors, an article declared, are the new Investor Class
. . . Today, the Investor Class is angry and disillusioned because it feels
betrayed (25 February 2002c). If investors lose their faith in stocks and pull
out in a big way, another stated, they could seriously hurt the economic
recovery (25 February 2002e). Reform was thus a price to pay for a good
short in supply and high in demand.
But how much reform was needed to achieve this trust? How was the reform
price determined? The second element in the structure of the reform subdiscourse offers the answer: the reform price was determined through an
exchange construct consisting of a moving three-point scale. Three alternative
paths of action were presented on this scale, but one was deemed insufficient,
another too tough and the third, in the middle, as just right: a fair price,
neither too cheap nor too expensive. There were variations to this scale, but
the most fundamental consisted of no reform, regulatory action and
legislation. In the following citation, the three are presented as options
held by most economists, Republicans and Democrats, respectively:
recovery times from earlier stock bubbles are sobering . . . [but m]ost
economists doubt that history will repeat itself so cruelly. After all the US
economy is in much better shape now . . . Still, thats cold comfort for ordinary
investors. . . Shareholders are clamoring for more accountability . . . Despite
bipartisan tears for Enrons victims, the parties are taking different approaches.
Democrats see Enron as justification for a strong assertion of government power
to outlaw conflicts of interest and even restore the ban on companies operating
in both the banking and securities industries . . . But in the GOP, proponents of
investor empowerment are more likely to prevail. Treasury Secretary ONeill
. . . and SEC Chairman Harvey L. Pitt dont think that Washington rulemakers
can anticipate all the combinations and permutations of every business activity
in the world, as ONeill puts it. Instead, they would cater to the Investor Class
with more transparency. On Feb. 13, the SEC took a large step in that direction
by announcing plans to impose far stiffer disclosure rules on companies . . .
(25 February 2002c)

Once under way, this just right reform of stiffer SEC disclosure rules 
neither too light nor too tough  was described as creating dramatic
changes, as constituting a high enough price. The ground is shifting beneath

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the foundation of Corporate America, it was thus declared two months later.
Fueled by investor resentment and driven by renewed activism by regulators,
a new age of reform is radically changing the rules of business in America
(29 April 2002b).
Yet, as the stock market continued falling and more scandals erupted, the
reform price rose along the scale. Articles next embraced the proposal noted
tougher before. Thus, an editorial titled Accounting: stronger reform,
please, stated: we think the best bet for strong accounting and financial
reform is the legislation proposed by Senator Paul S. Sarbanes (D-Md.)
(3 June 2002). Once this legislated reform was passed, BusinessWeek writers
announced that a believable bottom line is back: Credibility in financial
numbers is quickly being restored. Investor confidence and the willingness to
risk buying stocks should soon follow (17 March 2003).
But once the stock market stabilized and the Enron trials were over there
was a backward motion on the three-point scale. As far as accounting was
concerned, the Sarbanes-Oxley Act supported earlier was claimed to entail too
high a price:
The intentions were good. But in the two years since its passing, the SarbanesOxley Act has collapsed into a glob of regulatory confusion costing U.S.
businesses billions of dollars a year in compliance costs. Now comes the mad
dash to fix the statute . . . On Nov. 30 a long-awaited report from a committee of
Wall Street VIPs gave its best idea: Lets tinker. Rather than repealing SarbOx,
the committee recommended minor changes to the law, such as relief for small
companies and better guidance from regulators on how to apply the rule. The
act never got the vetting it deserved because of the race to approve it after the
Enron and WorldCom meltdowns, but the SEC . . . is hoping to make
improvements by spring.
(18 December 2006)

Thus the legislative reform was cast as too costly  a pricey concession to be
legitimately reduced through the tinkering of market actors and the
modifications of regulators. The same occurred with regard to other major
reform-issues which were priced up until the sense of investors trust was
regained. Consider corporate governance:
Actually, too many [boards] are running scared. And while that may give some
governance groups a self-satisfied twinge of victory, a board in defensive mode is
bad for employees, companies, and the economy . . . hunkering down over
numbers and downside scenarios is just not what boards should be doing with all
their time.
(25 December 2006)

And consider corporate crime:


Yes, the system worked. In fact, the old system worked . . . Look, business isnt
perfect, and it never will be as long as it is comprised of human beings. After all,

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we have laws galore, and people still drive above the speed limit, rob
convenience stores, and, of course, do far worse . . . we cant let a small group
of companies rewrite reality and make businesspeople cower in shame and lose
their courage.
(12 June 2006a)

Thus, through most of the period calls for reform gave an impression of a
discourse transcending its bounds by embracing proposals of change deemed
too tough before. However, the goal of reform was defined in terms of fixing
trust in the market, not the market itself. Moreover, the discursive movement
was structured as a form of exchange with articles setting a changeable reform
price for investors trust. This price was raised when trust seemed short in
supply and minimized when it seemed more abundant, marking a measured
movement never more expensive than deemed necessary by the constructed
price-scale.
Maximizing the use-value of a core market truism
The articles maximized the use-value of the market ideologys core truism
about human nature by applying it as a sole, fit-for-all explanation. The core
truism was that people are driven by self-interests, that this insatiable egoism
is the predominant inner force that directs them not only in the realm of
market exchange (where it is traditionally expected and supposedly
monitored by an invisible hand), but in other contexts as well. Thus, in all
the professional contexts reflected upon, problems were attributed to
unmonitored self-interests, constructing them as a force so preponderant as
not to yield to and conflict with role interests that should transcend them (i.e.
conflicts of interest). And solutions were defined in terms of monitored selfinterests, engineered through incentive or oversight programmes to be
checked and balanced against the professional interests. Applying selfinterest to basically every problem in need of explaining, the articles turned the
failures of the professional foundations of the market economy into proof of the
correctness of this foundational truism of the market ideology.
For example, in Enron [s]elf-interested executives gorged with stock-option
wealth and [m]any of the corporations outside professionals fell prey to greed
and self-interest as well (6 May 2002). Fastow had a clear conflict of interest,
as did other executives and Andersens accountants (17 December 2001).
Lawyers had conflicts of interest (4 March 2002). Bankers had conflicts
of interest (12 August 2002). Conflicts of interest stopped Wall Street
analysts from pulling the plug on Enron (17 December 2001). Financial
conglomerates have egregious conflicts of interests (9 September 2002).
The New York Stock Exchange is another bundle of conflicts of interest
(13 October 2003).
To solve these conflicts of interest, articles claimed, incentives and oversight
must be engineered to monitor self-interests. Corporate America has . . . to

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restore the checks and balances that would allow capitalism to work as
effectively as it could (1 July 2002). Checks and balances must be restored to
corporate governance (29 July 2002). Or: Its time to reinstitute checks and
balances inside the US financial system (9 September 2002).
Self-interest was thus presented as the single, fundamental source of
practically all choice and behaviour, its predominance and consequent conflict
with other interests as the source of all problems and its checking and
balancing as the key to solutions. It was the origin and the horizon, the
question and the answer. The all-encompassing self-interest was nonetheless
haunted by its opposite: the possibility of altruism and selflessness. Was
Sherron Watkins really so selfless? (16 December 2002) asked an article
reporting revisionist criticism about the whistleblower who was declared a
hero a year earlier. Discussing philanthropy, an article assured readers that
companies argue their funding causes are completely within their self-interest
(1 December 2003). And, referring to Bushs State of the Union address, a
writer expressed disappointment that even President Bush apparently
subscribes to the romantic notion that volunteering is somehow better for
society than working at a market wage, and, citing Adam Smith, declared: as
a general tendency, it is better if people operate from self-interest than from a
desire to serve the public good (25 February 2002d).
Thus, both the bad and the good were made up of self-interests. Problems
and solutions, too: self-interests. The point here is not ontological but economical: the discourse bolstered the use-value of its core truism by selling it in every
heuristic corner. Every reported failure and success, every misdeed and deed
were used to further annihilate human motivations, perceptions and ambitions
by this single, unified abstraction standing at the core of the market ideology.

More-lizing
The third principle concerns the juxtapositioning of more and morality,
quantity and ethics. The underlying premise, repetitively constituted, was that
the two always come together or go together. Thus, as shown, market justice
was seen to work by raising or hammering stocks.
This should not be taken to imply that more and morality were
constituted as identical. The two were distinguished. In accordance with the
self-interest truism, the underlying premise was that morality is too romantic a
notion to direct behaviour or bring about actual good. Impractical on its own,
it needs more as its horizon and motivation. Accordingly, calls for good
behaviour were couched in growth-evoking rationalizations, never completely
justifiable as ends in themselves. For example: companies . . . with the most
transparency will be rewarded with higher stocks. And theyll deserve it
(4 February 2002a).
The juxtapositioning of more and morality further expressed itself in the
structuring of the discourse in terms of both the timing of the morally-charged

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dramatic turns and the dynamics of size. Regarding the former, articles took
their moral cues from quantitative shifts: they idealized Enron when it was
growing, renounced it as its stock was falling, reproached it as it went
bankrupt, criminalized it as the bankruptcy turned out to be the biggest in
history. Major turns in the moral narrative thus explicitly correlated with
quantitative signals. In other words, the moral plot was structured along the
contours of a stock-price graph or an income diagram.
Regarding the dynamics of size, the declared moral shocks were accompanied by rises in the volume of rhetoric. If two articles referring to Enron
were published in October 2001, the month before a debacle was announced,
then thirteen were published in November and forty-three in the bankruptcy
month of December. The number further rose as more scandals erupted,
giving the impression of a rhetorical swell sustained by the flow of moral
shocks: the number peaked at eighty-one in February and averaged forty-seven
in the five months that followed. Then it gradually dropped and from April
2003 onward the average number of articles per month was seven. Thus, the
intertwining of more and morality expressed itself in both narrative
structure and shifts in volume.

Competing
The final structuring principle was expressed in the tendency of articles to
conjure up and sustain a sense of competitive rivalries and to secure a sense of
advantage within them. A major discursive competition of this sort concerned
the global status of American capitalism. Basically, articles sought to persuade
readers that despite Enron and other scandals American capitalism was still
number one. Thus, while compliments were granted to specific foreign
CEOs or companies (e.g. the European BusinessWeek 50 list, 28 July 2003),
writers repeatedly reasserted the inferior status and achievements of foreign
markets. The strategies of persuasion diverged, and I will illustrate three. The
first was to cast Enrons fall as a tribute to American capitalism. Consider the
following excerpt from a commentary titled Why a few Enrons would do
Europe good:
. . . Enrons fall is a reminder of just why the American economy has been
performing so much better than its European rivals over the past two decades 
and why it will probably continue to do so despite the pain of the current
recession. The speed at which Enron crashed is almost a textbook example of
Austrian-born economist Joseph A. Schumpeters celebrated description of
creative destruction at the heart of vibrant capitalism . . . Compare and contrast
that idea with the state of Europes industrial undead. (31 December 2001)

A second strategy was to acknowledge that Enron was causing trouble for
American capitalism, but nonetheless argue that foreign markets are facing
related or similar competitive setbacks. Discussing Europe, one article for

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example stated, Make no mistake, though: Enronitis is having its effect there,
too (25 February 2002b). Another stated that the Continent . . . is grappling
with severe economic shocks, that it might have Enron-scale time bombs and
that European equities have imploded far more severely than stocks in the
US (31 March 2003).
A third strategy was to ascertain that American capitalism had proved its
superiority by the quality of its recuperation from the scandals. Consider the
following citation:
When it comes to US corporate scandals, the bad news never stops . . . Yet despite
their magnitude, these sins are of the venial rather than the mortal variety . . . The
fact is, CEOs in the US lack the power to drag down entire industries or the
economy as a whole . . . The imperial CEO . . . is much less pernicious than an
entrenched government bureaucracy, an economy dominated by a few large
families, or a single-party political system. Such roadblocks to growth are far more
common in Europe and Japan than they are in America . . . The ability to fix
problems when things go wrong is one of the great virtues of the US economic
system . . . Thats tough for other countries to match . . .
(4 April 2005)

Thus, rhetorically recasting Enron as a sign of strength, BusinessWeek reporters


used it to assert an advantage in a discursive competition over the international
first place.

Conclusions
The analysis of Enron-related articles published during a decade in a central
business magazine was designed to explore some of the cultural attributes of
capitalist reflexivity. The analysis tracked the rise and fall of the Enron icon: its
enactment as an enchanting emblem of the new economy and its transformation
into a symbol of corruption and evil. This transformation, I showed, occurred
in the context of the California deregulation crisis, but was primarily narrated in
terms of accounting irregularities. It caught momentum alongside the
companys plunging stock. By the time of bankruptcy, Enron was already cast
as the New Economys number-one criminal, a single scandalous offender, albeit
with plenty of professional accomplices from all corners of the financial scene.
The sense-making that followed the bankruptcy tackled the contradictions
and failures made evident by Enron. The tackling of these failures, however,
always seemed on guard to protect the neo-liberal ethos, exonerating the market
by compressing blame into the realm of a supposedly deviant market actor and
diffusing it outside the market, to the professions charged with ensuring the
integrity of numbers. Minimizing the markets blame was thus revealed as a
prominent structuring principle in a grammatical code of reflexivity which
included other principles as well: minimizing reform concessions, maximizing
the use-value of the core self-interest truism, quantitatively cueing moral

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outrage and competing. To a great extent, then, the capitalist discourse under
analysis managed its beliefs like a capitalist manages money: it responsively
paid in discursive concessions  making knowledge revisions as it reappraised
superstar managers or acknowledged problems with the financial professions 
but its underlying commitment was to cutting costs and capitalizing on the
core discursive asset; it traded convictions but the exchange was conducted
with an eye open to supply and demand; it sanctified more as morality; and it
craved competition and mobilized all the forces of construction to winning.
This, it should be stressed, is not a mere analogy. The reality statements
produced this way never saw themselves as a metaphor but as a truth; indeed, a
winning truth.
This paper is based on a single case study. Theorists that I reviewed in the
opening section have noted the importance of media discourse for understanding the workings of contemporary capitalism and capitalist institutions.
This study encompassed an influential, popular and mainstream media outlet,
but, since it is a single case study, it does not easily lend itself to generalization.
The core value of this studys contributions lies in the sort of rethinking
and research that its empirically-grounded findings can incite. Its conclusions
should be read along these lines as propositions for future theoretical
development.
A first conclusion concerns the pervasiveness of the capitalist mindset. If
capitalism produces beliefs in the same way it produces money, if it approaches
both with the same impulses, than its materialism should be seen as pertaining
not only to what people think or value but also to how people think. With a
grammatical code that pertains not only to economic but also to ideational
production, capitalism appears to be programmed to efficiency in the crafting
of discursive products, in the crafting of truths.
This grammatical code may explain the simultaneity of capitalisms
transformation and resilience. Capitalist discourse, the analysis indicates,
does responsively surrender truths in the reflexive process, but the price paid
in terms of surrendered content is reclaimed by the structure of the surrender:
by its cost-efficiency; by the value of the truism it objectifies in exchange; by
the way it recasts its loss as a competitive advantage. Even as reflexivity aims to
resolve contradictions by examining capitalisms axioms, its impulses are
annihilated by these axioms, performing them through the process of critique.
Capitalist reflexivity thus seems to be a sense-making mechanism cast in the
shape of its own beliefs.
As such, reflexivity is neither above nor beyond capitalist culture.
Reflexivity, this case study indicates, is not conducted from some disembedded
outside: a critical edge (Thrift, 2005), a space between institutions (Berk &
Scheiberg, 2005), a liberated high ground of expertise (Giddens, 1994), a
groundless ground (Lash, 1994a) and so on. Rather, it appears as a structured
praxis that is deeply shaped by capitalist impulses, turning critical selfreflection into a symbol of the potency and validity of the culture that is
reflected upon.

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What are the implications of these findings for theories of the new politicaleconomic virtualism, institutional change and late modernity? Regarding the
first, the findings indicate that as the virtual realm turns contradictions and
truth failures into objects of abstract reflection it transforms them from
structural threats to raw materials of a discursive production system set, like
any production system, on minimizing costs and securing profit. Thus, the
claim that reflexivity enables capitalism to surf along the edge of its own
contradictions (Thrift, 2005, p. 6) tells only half the story: reflexivity also
turns the surfing into an economical endeavour. As such, it re-embeds critical
reflection into the same culture it appears to distance itself from. The story
here is thus not merely one of the virtualization of the economy (e.g. Carrier &
Miller, 1998), but also one of the economization of the virtual realm. Far more
than being constitutive of economic practice (e.g. Carrier, 1998; Miller, 1998),
or even of staying close to economic practice (Thrift, 2005), reflexive thinking
is an economic practice. In order to understand what virtualism holds in store
for contemporary capitalism, there is a need to study it as such.
Regarding institutional change theory, the findings of this research indicate
that the process of deliberating alternatives or choosing paths may not only be
the mark of agents wits and pragmatic sensibilities (e.g. Berk & Schneiberg,
2005), but also of a culturally structured reflexivity that they conform to and
enact. It is thus problematic to take agents sense of reflective ingenuity at face
value. Though deliberation can and does evolve in new directions, the study
indicates that it is also conditioned by a grammatical system that patterns it
along particular, taken-for-granted routes, that filters deliberation and
mediates change. Reflexivity thus seems to be an institution-modifying
institution of sorts. Change, it seems plausible to propose, is determined
through the interplay between this institution of reflection and the institutions
that are reflected upon, an interplay whereby discourse does not merely impact
on the structures that are reflected upon (Schmidt, 2008), but is also
structured by them itself, grammatically embodying the same rules and
conventions it observes. This finding indicates a much more intricate
institutional change dynamics than is currently acknowledged and points to
the need for further methodical research into the unfolding logic of reflection
and deliberation.
Regarding late modernity theorists, the findings of this study fit uncomfortably with their various accounts. The reflexivity studied here did not appear
to be an unaware reflex gradually becoming cognizant, as Beck (1992)
maintains, or the mark of a liberated cognition, as Giddens (1990, 1994)
does. Even as existing beliefs were examined, the underlying structure of
reflexivity became neither cognizant nor liberated: reflexivity was thoroughly
captivated by the same capitalist beliefs it reflected upon, performing them (for
example, by structurally binding morality and growth, cutting costs or
maximizing value). The examined reflexive process also did not appear to be
born of the fashionable mimesis Lash (1994a) refers to by the term aesthetic
reflexivity or of the self-mobilized, groundless hermeneutics he refers to by

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the term hermeneutic reflexivity. Rather, reflexivity appeared to turn beliefs


into belief-producing grammar in a loop that both shied away from the
visible surface and trapped interpretations inside themselves: discursively
self-interested, it found self-interest everywhere but in its own impulses;
discursively competitive, it found competition everywhere but in its own
beliefs; discursively consumed by questions of blame, it found blame
everywhere but in its own main constructs. Thus, reflexivity appeared to
have an inner structure which interpretatively grounded its unfolding
dynamics. Any account linking reflexivity to late modernitys culture and
institutions must take into account a dialectical process which reaffirms the
same underlying logic it also reconsiders, deeply embodies the same culture it
also critically interprets and hides the taken-for-granted from view by the
process of observation itself.
Thus, this case study offers empirical evidence indicating that the
theoretical accounts advanced by all three streams offer too simplistic a view
of the actual workings of reflexivity. Theorists from all the streams have much
to gain by continuing this studys effort of mapping out its cultural grammar.
Further analyses of other concrete processes of reflexivity would hopefully
contribute to our understanding of the mechanisms of economic self-reflection
and social critique, of the forces structuring our understanding of mistakes and
our inclination for change.

Acknowledgements
I thank Economy and Societys anonymous reviewers for their comments. I also
thank Michael Shalev, Gideon Kunda and Daniella Arieli for their suggestions.
This research was supported by the Israel Science Foundation (grant no.
568/08).

Notes
1 By discourse I refer to a particular way of defining, describing and narrating both
events and knowledge about events. The concept of culture is related to that of
discourse, although as they are used here the latter is more directly concerned with the
content of meaning, the former with its underlying patterning and organization.
2 This analysis includes content selected by an academic computerized search engine.
Note that until 2005 BusinessWeek customized its domestic edition for Europe and Asia.
Articles referenced by the search engine as belonging to these customized Englishlanguage editions are included in the analysis (less than 10 per cent of the total amount
of articles, some of which were also published, often with slight changes, in the
domestic edition). The analysis does not cover BusinessWeek Online and the local
language editions that were published with regional partners since 2005.
3 http://finance.google.com/finance?qbusinessweek&hlen (22 June 2009).
4 http://onlinepresrom.net/businessweek/ (25 June 2009).

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5 This study does not examine BusinessWeek itself, the way it functions or the way its
audience receives it. Nor does it examine actual Enron events as existing outside their
media representation.
6 Different search engines select slightly different numbers of articles in this
date range. I began the analysis with one search engine and then updated the
dataset according to the larger citations list (consisting of 1118 items) of LexisNexis.
The difference was approximately eighty items. Note, that data did not include readers
reports. The databases used for referencing are Gale Academic Onefile and LexisNexis.
7 The Californian crisis regained attention months later, when evidence was found
indicating that Enron (and other traders) manipulated its deregulated market. Thus the
crisis returned to centre stage as a means for augmenting the sense of Enrons deviancy,
after it was possible to use it as such.
8 This discussion does not concern actual blame but blame discourse. For example,
when claiming that the articles repeatedly directed blame discussions away from the
market, I am not debating whether or not market blame existed, but pointing out that
the discourse always tended to evolve this way.
9 It is interesting to note that a rare pro-regulation article sustained this basic blame
construct, sanctifying market ideals by posing Enron as an assault on the very heart of
capitalism (4 February 2002b).

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BusinessWeek articles cited


9 September 1997. The quiet man whos jolting utilities. G. McWilliams, 3530, 84.
24 May 1999. Enron isnt home free yet. M. Kripalani, 3630, 70E4.
10 January 2000. The dynamo at Enron. 3663, 73.
27 March 2000. The 50 best performers. A. Barrett with S. Hamm, S. Rosenbush,
S. Rutledge, R. Roeker, A. T. Palmer . . . and bureau reports, 3674, 124.
15 May 2000. Jeffrey Skilling. W. Zellner, 3681, EB66.
24 July 1000. Enron electrified. W. Zellner, 3691, EB54.
28 August 2000. Gridlock on the power grid. P. Coy with C. Palmeri, 3696, 48.
18 September 2000a. Are you web smart? M. Stepanek, 3699, 36.
18 September 2000b. The web smart 50. 3699, 35.
12 February 2001a. Power play. W. Zellner with C. Palmeri, P. Coy & L. Cohn, 3719, 70.
12 February 2001b. Market lessons from California. Editorials. 3719, 112.
14 May 2001. The numbers game. D. Henry with C. H. Schmitt, 3732, 100.

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12 November 2001. The Enron debacle. S. Anderson Forest & W. Zellner with
H. Timmons, 3757, 106.
26 November 2001. End the numbers game. Editorials. 3759, 130.
10 December 2001a. Enron: Running on empty. P. Coy, E. Thornton, S. A. Forest with
C. Palmeri and bureau reports, 3761, 80.
10 December 2001b. Skilling: The man who knew . . . how much? W. Zellner, 3761, 82.
17 December 2001. Enron: Let us count the culprits. Editorials. 3762, 154.
31 December 2001. Why a few Enrons would do Europe good. J. Rossant, 3763, 22.
28 January 2002a. How to prevent future Enrons. Editorials. 3767, 124.
28 January 2002b. Theres no positive spin on this one, Mr. Lindsey. H. Gleckman, 3767,
41.
4 February 2002a. Brutal honesty could force a market correction. M. der Hovanesian,
3768, 44.
4 February 2002b. Enron: A powerful blow to market fundamentalists. R. Kuttner, 3768,
20.
4 February 2002c. The man behind the deal machine. W. Zellner with M. France &
J. Weber, 3768, 40.
11 February 2002a. Paying for the sins of Enron. N. Byrnes, 3769, 35.
11 February 2002b. The good, the bad, and the worse. R. Barker, 3769, 90.
25 February 2002a. Congress will huff and puff and . . . do little. G. Weiss, 3771, 116.
25 February 2002b. In Europe, the search is on for other Enrons. S. Reed with K. Capell,
A. Reinhardt, C. Matlack and bureau reports, 3771, 58.
25 February 2002c. The betrayed investor. M. Vickers & M. McNamee with P. Coy,
D. Henry, E. Thornton, M. Der Hovanesian and bureau reports, 3771, 104.
25 February 2002d. The state of the union: Bush mostly got it right. R.J. Barro, 3771, 30.
25 February 2002e. The wrath of the investor class. Editorials. 3771, 150.
4 March 2002. Et tu, Enron lawyers? G. Weiss, 3772, 80.
18 March 2002. Enron was mostly right about one thing: Deregulation. G.S. Becker, 3774,
26.
8 April 2002. Auditing here, consulting over there. N. Byrnes with M. McNamee,
R. Grover, J. Muller & A. Park, 3777, 34.
29 April 2002. A ripe time for reform: Editorials. 3780, 130.
6 May 2002. How to fix corporate governance. J. A. Byrne with L. Lavelle, N. Byrnes,
M. Vickers & A. Borrus, 3781, 68.
20 May 2002. And the Enron award goes to . . . Enron. M. J. Mandel with W. Zellner,
3783, 46.
3 June 2002. Accounting: Stronger reform please. Editorials. 3785, 102.
10 June 2002. Time for CEOs to speak up. Editorials. 3786, 160.
1 July 2002. Investor power has its downside, too. J. A. Byrne, 3789, 48.
8 July 2002. Can trust be rebuilt? B. Nussbaum. 3790, 32.
29 July 2002. Getting the message, finally. Editorials. 3793, 116.
12 August 2002. Merrill has to face the music. Editorials. 3795, 116.
26 August 2002a. 3: Crimes against the information age. M. J. Mandel, 3796, 80.
26 August 2002b. 8: Firepower for financial cops. J. Weber, 3796, 98.
9 September 2002. Flawed financial giants. Editorials. 3798, 156.
16 December 2002. Was Sherron Watkins really so selfless? W. Zellner, 3812, 110.
13 January 2003. The best (& worst) managers of the year. 3815, 58.
17 March 2003. A believable bottom line is back. Editorials. 3824, 118.
31 March 2003. Europe cant afford to stay mad for long. J. Rossant, 3826, 42.
28 July 2003. The best European performers. D. Fairlamb with J. Ewing, G. Edmondson,
K. Capell, S. Reed, A. Reinhardt & F. F. Jespersen (international eds), 3843, 50.
13 October 2003. The big board: Crying out for regulation. R. Kuttner, 3853, 26.

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1 December 2003. The corporate donors. M. Conlin & J. Hempel with J. Tanzer &
D. Polek, 3860, 92.
4 April 2005. A few bad apples spoil . . . not much. M. J. Mandel, 3927, 38.
6 February 2006. Ken Lays audacious ignorance. A. Bianco, 3970, 58.
12 June 2006a. The real verdict on business. J. Welch & S. Welch, 3988, 100.
12 June 2006b. The Skilling trap. M. Gimein, 3988, 31.
18 December 2006. The jury is out. 4014, 106.

Galit Ailon is a lecturer at the Department of Sociology and Anthropology at


Bar-Ilan University. She received her PhD from the Department of Labor
Studies at Tel-Aviv University. She is author of Global ambitions and local
identities: An Israeli-American high-tech merger (Berghahn Books, 2007). Her
primary research interests currently concern multinational organizations and
global financial culture.