Italian municipalities and the politics of financial derivatives: Rethinking the Foucauldian perspective

This study examines the use of interest rate swaps by Italian municipalities during the 2000–2014 period. Through a constructive critique of Foucauldian political economy, it argues that local administrators did not enter the swaps market to perform and depoliticize the disciplinary power of financialized discourses. The evidence suggests many more layers of historical complexity underlie the municipalities’ actions than a Foucauldian approach can grasp. Local governments used swaps to circumvent the budget constraints imposed by the European Stability and Growth Pact. In this sense, municipalities acted more for political-strategic than for performative and depoliticized purposes. Rethinking the dimensions of performativity and disciplinary power – through an approach that is more sensitive than Foucauldian analysis to historical agency and asymmetrical power relations – is crucial to address the differential and politically shaped contours of financialization across the globe.