In The Kingdom and the Glory, Agamben proposes that there are two competing paradigms in Western politics: political theology and economic theology. Two questions immediately arise. First, if the “theological” appears in both paradigms, why is it not redundant? That is, why can’t algebraically cancel out theology and simply refer to the “political” and “economic” paradigms? Secondly, if the “theological” is really a separate element that creates a different kind of chemical compound with each of the other two, then why can’t we also have something called “political economy” as a third, competing paradigm?
Let’s start with the political theological. A first glance indicates that this paradigm does not actually exclude the economy. If we assume that the theological designates something like the horizon of meaning, we might say that in political theology, the sovereign ruler (politics) creates and distributes meaning (theology). This occurs by means of an economy, but the economy is used in a purely instrumental way and so does not emerge as a defining element. An extreme political theologian like Schmitt would want to get rid of that economic element or at least deny it all meaning and autonomy.
If this interpretation holds, then it would appear that economic theology in the form of secular liberal capitalism also includes the political. In this paradigm, the economy itself is what is most meaningful (theological) — we constantly seek guidance from market signals, etc., and the political is the instrumentalized element that therefore never becomes determinative. As in the political theological paradigm, the political is identified with glory and acclamation, but it takes a different form, becoming basically a glorification of the economy itself. Parallel with Schmitt, an extreme economic theologian wants to erase the realm of the political altogether or at least keep it from interfering in any way with the pristine market.
So what would political economy be here? If political theology is fascism and economic theology is liberal democracy, then it seems like political theology should be communism — as the implicit reference to Marx in the name itself might indicate. Perhaps we could say that meaning (the theological) becomes the subordinate, instrumentalized instance here, as the political and the economic become increasingly indistinguishable. And in the end, universal cynicism means that the official ideology becomes a purely negative point of reference, serving solely to prevent the emergence of any alternative horizon of meaning, much as the constitutional monarch is sometimes said to occupy the place of head of state to prevent anyone else from really, effectively claiming that place.
Perhaps the question of whether this description of communism holds true — perhaps justifying its exclusion as an irrelevant dead end — can help us to decide the extent to which Agamben’s other two paradigms are actually adequate or useful.
An und für sich 
Does “the economy” assign values or do Keynes “defunct economists”?
“Practical men, who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist.”
I’m pretty sure that the view that making money is inherently valuable and hence activities that make more money are more valuable has been hegemonic throughout the capitalist era, regardless of the intellectual fashions in economic theory.
Do you mean that Agamben would see communism/political economy as an “irrelevant dead end”? Because it seems to me he would welcome a situation that subordinated theology–where “meaning” was never abstracted (never “Law”) but always responsive to the economic/political work of building a community. I may be misreading your last paragraph.
But he dismisses the economy as beyond redemption in “Angelology and Bureaucracy.” And as for communism, I was thinking of Real Socialism rather than the ideal of communism.
I’m not sure if that really captures what’s going on in fascism: we have regimes where the sovereign ruler creates and distributes narrative — where “the sovereign is the story”, so whoever writes the story is sovereign — and they don’t look like Mussolini. In fascism, the sovereign reflects and amplifies an [allegedly, but usually in practice] pre-existing story: the state is supposed to be the highest expression of the people, and instead of writing the narrative ex nihilo, it takes the history and current state of ‘the people’ as its reference point. Maybe a distinction between political theology and theological politics is in order: in the latter, the sovereign is tasked with reflecting, protecting, and advancing supposed nature of the polis, the Volk, whatever — subordinating politics to theology, the sovereign to the story, at least in theory — whereas in the former, the sovereign acts as a vanguard, tasking the people with keeping up with it — subordinating the story to the constantly rewriting sovereign. The former looks like politics; the latter is, well, America.
Or am I misinterpreting ‘politics’?
Political economy, assuming I’m not misinterpreting anything, is techno-commercialism, right-accelerationism, whatever you want to call it: the political economist wants to separate information and state, story and sovereign. Given that right-accelerationism formed explicitly as a (post-?)libertarian reaction to theological politics, a reaction that says that *any* theological involvement leads to bad governance, it shouldn’t be surprising that they want theology thrown out entirely: the goal is to establish a government market, a patchwork of microstates all granting those allowed participation in the economy free exit. For the political economist, progressivism (i.e. actually existing American ‘liberalism’), communism, and fascism are all basically the same, because they still allow a place for theology — that is, meaning outside the market.
In my understanding communism falls into political theology. The sovereign creates the narrative/big other/historical necessity and that in turn justifies the ruling of sovereign.