Inside the Economy of Appearances

Anna Tsing

Indonesia’s profile in the international imagination has completely changed. From the top of what was called a “miracle,” Indonesia fell to the bottom of a “crisis.” In the middle of what was portrayed as a timeless political regime, students demonstrated, and, suddenly, the regime was gone. So recently an exemplar of the promise of globalization, overnight Indonesia became the case study of globalization’s failures.

The speed of these changes takes one’s breath away—and raises important questions about globalization. Under what circumstances are boom and bust intimately related to each other? If the same economic policies can produce both in quick succession, might deregulation and cronyism sometimes name the same thing—but from different moments of investor confidence? Such questions run against the grain of economic expertise about globalization, with its discrimination between good and bad kinds of capitalism and policy. Yet the whiggish acrobatics necessary to show how those very economies celebrated as miracles were simultaneously lurking crises hardly seem to tell the whole story. A less pious attitude toward the market may be necessary to consider the specificities of those political economies, like that of Suharto’s Indonesia, brought into being together with international finance.1

This essay brings us back to the months just before Indonesia so drastically changed, to canoe at the running edge of what turned out to be a waterfall, and thus to think about a set of incidents that can be imagined as a rehearsal for the Asian financial crisis as well as a minor participant in the international disillusion that led to the Suharto regime’s downfall. In 1994 a small Canadian gold prospecting company announced a major find in the forests of Kalimantan, Indonesian Borneo. Over the months, the find got bigger and bigger, until it was the biggest gold strike in the world, conjuring memories of the Alaskan Klondike and South Africa’s Witwatersrand. Thousands of North American investors put their savings in the company, called Bre-X. First-time investors and retired people joined financial wizards. Whole towns in western Canada invested.2 The new world of Internet investment blossomed with Bre-X. Meanwhile, Bre-X received continuous coverage in North American newspapers, especially after huge Canadian mining companies and Indonesian officials entered the fray, fighting over the rights to mine Busang, Bre-X’s find.3 The scandal of Indonesian business-as-usual, opened to public scrutiny as corruption, heightened international attention and garnered support for Bre-X. But, in 1997, just when expectation had reached a fevered pitch, Busang was exposed as barren: There was nothing there. Gasps, cries, and law suits rose from every corner. Even now, as I write two years later, the drama rumbles on. The Toronto Stock Exchange is changing its rules to avoid more Bre-Xs.4 Bre-X law suits set new international standards.5 Bre-X investors still hope and complain across the Internet, as they peddle the remains of their experiences: jokes, songs, and stock certificates (as wallpaper, historical document, or irreplaceable art, ready to hang).6 Meanwhile, Indonesian mining officials and copycat prospecting companies scramble to free themselves from the Bre-X story, even as they endlessly reenact its scenes, hoping to rekindle investor enthusiasm.7 Hope’s ashes are inflamed even by ridiculous claims; recently the Bre-X chief geologist, named in many lawsuits, says there is gold at Busang. Who is to prove him wrong?8

The Bre-X story exemplifies popular thinking about the pleasures and dangers of international finance and associated dreams of globalization. The story dramatizes North-South inequalities in the new capitalisms; it celebrates the North’s excitement about international investment, and the blight of the South’s so-called crony capitalisms: business imagined not quite/not white. Painting Southern leaders as rats fighting for garbage, the story also promises new genres of justice for the Northern investor who dares to sue. Finance looks like democracy: The Inter-net, they say, opens foreign investment to the North American everyman. But the Bre-X story also narrates the perils of the downsized, overcompetitive economy: the sad entrepreneurship of selling worthless stock certificates on-line. As one writer put it, mixing metaphors, “The Bre-X saga will come to be known as the demarcation of the Internet as the weapon of choice for investors.”9

Most salient to my concerns about the specificity of global economic promises is the genre convention with which Bre-X started its own story, and by which it was finished off. Bre-X was always a performance, a drama, a conjuring trick, an illusion, regardless of whether real gold or only dreams of gold ever existed at Busang. Journalists compared Busang, with its lines of false drilling samples, to a Hollywood set.10 But it was not just Busang; it was the whole investment process. No one would ever have invested in Bre-X if it had not created a performance, a dramatic exposition of the possibilities of gold.

Performance here is simultaneously economic performance and dramatic performance. The “economy of appearances” I describe depends on the relevance of this pun; the self-conscious making of a spectacle is a necessary aid to gathering investment funds. The dependence on spectacle is not peculiar to Bre-X and other mining scams: It is a regular feature of the search for financial capital. Start-up companies must dramatize their dreams in order to attract the capital they need to operate and expand. Junior prospecting companies must exaggerate the possibilities of their mineral finds in order to attract investors so that they might, at some point, find something. This is a requirement of investment-oriented entrepreneurship, and it takes the limelight in those historical moments when capital seeks creativity rather than stable reproduction. In speculative enterprises, profit must be imagined before it can be extracted; the possibility of economic performance must be conjured like a spirit to draw an audience of potential investors. The more spectacular the conjuring, the more possible an investment frenzy. Drama itself can be worth summoning forth.11 Nor are companies alone in the conjuring business in these times. In order to attract companies, countries, regions, and towns must dramatize their potential as places for investment. Dramatic performance is the prerequisite of their economic performance.

Yet conjuring is always culturally specific, creating a magic show of peculiar meanings, symbols, and practices. The conjuring aspect of finance interrupts our expectations that finance can and has spread everywhere, for it can only spread as far as its own magic. In its dramatic performances, circulating finance reveals itself as both empowered and limited by its cultural specificity.

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Notes

This essay was first presented as a talk at the Society for Cultural Anthropology meetings in San Francisco in May 1999. A number of colleagues have generously encouraged me to write about Bre- X. Rheana Parrenas offered invaluable research assistance. Steven Feld and Tania Li contributed their newspaper clippings on the Bre-X saga. Arjun Appadurai, Kathryn Chetkovich, Paulla A. Ebron, Celia Lowe, and Lisa Rofel offered their comments on earlier drafts.

1. As much as any place in the world, Indonesia rode high on the wave of enthusiasm for mobile, finance-driven international investment in the 1980s and early 1990s. Between the late 1980s and 1997, economic growth averaged about 8 percent annually, and in early 1997 economists saw “little sign of the turmoil that was to emerge” when the economy crashed later that year and the Suharto regime followed in 1998 (Ross McLeod, “Indonesia’s Crisis and Future Prospects,” in Asian Contagion: The Causes and Consequences of a Financial Crisis, ed. Karl Jackson [Boulder: Westview Press, 1999], 209). Looking back, many once enthusiastic analysts blamed the crisis on “cronyism,” residual protectionism, and bad national regulatory practices. See, for example, Karl Jackson, “Introduction: The Roots of the Crisis,” in Asian Contagion, 1–27.
2. Dale Eisler, “Sorrow in St. Paul,” Maclean’s, 7 April 1997, 100(14): 55.
3. From the first, the Bre-X story caught the popular imagination in Canada, and thousands of articles have been written about it. Most major Canadian newspapers covered the story in detail; the Calgary Sun, Calgary Herald, and Ottawa Citizen have had many installments of Bre-X news. Only rather late in the game did U.S. newspapers cover the Bre-X story regularly, but at the height of its fame and infamy much of the media across North America covered the story. Indonesian newspapers and news magazines also offered considerable coverage. Indonesian nongovernmental organizations added their distinctive perspectives in flyers and newsletters. Several books have been published about Bre-X, mainly by journalists. Diane Francis, Bre-X: The Inside Story (Toronto: Key Porter Books, 1997) and Douglas Goold and Andrew Willis, The Bre-X Fraud (Toronto: McClelland and Stewart Inc., 1997) tell the story with lively excitement. Vivian Danielson and James Whyte (editor and staff writer for the Northern Miner, respectively) offer their expertise on the people and politics of the mining scene in Bre-X: Gold Today, Gone Tomorrow (Toronto: The Northern Miner, 1997). Bondan Winarno’s Bre-X: Sebungkah emas di kaki pelangi (Jakarta: Inspirasi Indonesia, 1997) includes useful detail on Indonesian politics and texts of a number of Bre-X documents. Jennifer Wells’s coverage for the Canadian news magazine Maclean’s and John McBeth’s coverage for the Far Eastern Economic Review have also been very informative. John Behar’s “Jungle Fever,” (Fortune, 9 June 1997, 116–28) offers a useful description of Bre-X’s operations. Internet investor chat lines with Bre-X “threads” offer a wealth of both technical information and personal views on the drama.
4. “TSE Raises Listing Standards for Mining and Exploration Companies,” and “TSE Tightens Rules for Junior Miners,” CFRA News Talk Radio web site, 20 August 1998.
5. Bre-X lawsuits have their own web site: the Bre-X/Bresea Shareholder Class Action Information web site. Key issues have involved the liability of stock exchanges as well as Bre-X officials (Diane Francis, “Brokers Must Pay for Their Role in Bre-X,” National Post Online, 20 May 1999); the ability of Canadians to participate in U.S. class-action lawsuits (“Will Canadians Be Allowed in American Bre-X Suit?,” Daily Mining News, 31 March 1999 [on-line version]); and the nationwide (vs. provincial) scope of Canadian class action lawsuits (Sandra Rubin, “Let All Canadian Bre-X Shareholders in Class-Action Suit, Court Urged,” Financial Post, 11 February 1999 [on-line version]).
6. Thus, for example, the Bre-Xscam.com web site peddled jokes, news, and art about the Bre-X saga on their “Bungle in the Jungle” web page. A Canadian stockholder named Ross Graham recorded a song called “The Bre-X Blues” and made the CD available for sale on the Red Deer Advocate web page. He claims to have made back his losses on Bre-X investment through selling these CDs (“Bre-X Investor Gets Last Laugh with Song,” Breaking News, 22 December 1998, CANOE online version.)
7. “Indonesia Trying to Recover Reputation after Bre-X, Says Specialist,” CFRA News Talk Radio web site, 20 March 1999. Junior companies prospecting for gold in Kalimantan with “post–Bre-X” advertising of their claims include Kalimantan Gold Corporation (Vancouver); Twin Gold Corporation (Toronto); and Nevada Manhattan Mining Inc. (Calabasas, California).
8. “Felderhof Still Insists Bre-X Site Has Gold,” Financial Post on CANOE web site, March 1999.
9. David Zgodzinski, “Bre-X: The Battle Between Bulls and Bears on SI,” Silicon Investor web site, 1997.
10. Behar, “Jungle Fever,” 121.
11. To “conjure” is both to call forth spirits and to perform magical tricks; in each case, the term highlights the intentionality of the performance, the studied charisma of the performer, and the hope of moving the audience beyond the limits of rational calculation. These features characterize the economic strategies I discuss here, in which everyday performance requirements—for contracts, marketing, investor reports, and the like—are made into dramatic shows of potential.