25 CAPITAL AND LABOR, AN OLD STORY
Most people who talk and write about the U.S. political system never mention corporate capitalism. But the capitalist economy has an overbearing impact upon political and social life. It deserves our critical attention.
To begin, one should distinguish between those who own the wealth of society, and those who must work for a living. The very rich families and individuals who compose the owning class, live mostly off investments: stocks bonds, rents, and other property income. Their employees live mostly off wages, salaries, and fees. The distinction between owners and employees is blurred somewhat by the range of incomes within both classes. “Owners” refer both to the fabulously wealthy stockholders of giant corporations and the struggling proprietors of small stores. But the latter hardly qualify as part of the corporate owning class. Among the victims of big business is small business itself. Small businesses are just so many squirrels dancing among the elephants. And squirrels that dance among elephants have a notoriously low life expectancy. Every year over 30,000 small enterprises go out of business in the United States.
Among the employee class, too, there is much diversity. Along with factory and service workers there are professionals and executives who in income, education, and lifestyle tend to be identified as “middle” or “upper-middle” class. Company managers and executives are employees whose task is to extract more value-producing performance from other employees. And some top business executives, corporate lawyers, and entertainment and sports figures enjoy such huge incomes as to be able eventually to live off their investments, in effect becoming members of the owning class.
You are a member of the owning class when your income is immense and comes mostly from the labor of other people, that is, when others work for you, either in a company you own, or by creating the wealth that allows your investments to give you a handsome return. The secret to wealth usually is not to work hard but to have others work hard for you. This explains why workers who spend their lives toiling in factories or offices retire with little or no wealth to speak of, while owners who never set foot in the factory or firm can amass considerable fortunes. The ultimate purpose of a business is not to perform public services or produce goods as such, but to make as large a profit as possible for the investor.
Adam Smith, considered one of the founding theorists of capitalism, noted in 1776, “Labor . . . is alone the ultimate and real standard by which the value of all commodities can at all times and places be estimated and compared. It is their real price; money is their nominal price only.”1 What transforms a tree into a profitable commodity such as paper or furniture is the labor that goes into harvesting the timber, cutting the lumber, and manufacturing, shipping, advertising, and selling the product.
Workers’ wages represent only a portion of the wealth created by their labor. The average private-sector employee works two hours for herself or himself and six or more hours for the boss. The portion that goes to the owner is what Marx called “surplus value,” the source of the owner’s wealth. Capitalists themselves have a similar concept: “value added in manufacture.” In 2000, workers employed in manufacturing alone produced at least $1.64 trillion in value added, as reported by the U.S. Census Bureau, for which they were paid $363 billion in wages, or less than one-fourth of the value created by their labor. Workers employed by Intel and Exxon received only about one-ninth of the value added, and in industries such as cigarettes and pharmaceuticals, the worker’s share was a mere one-twentieth. In the last half century, the overall average rate of value added (the portion going to the owner) in the United States more than doubled, far above the exploitation rate of other industrialized countries.2 Workers endure an exploitation of their labor as certainly as do slaves and serfs. The slave obviously toils for the enrichment of the master and receives only a bare subsistence in return. James Madison told a visitor shortly after the American Revolution that he made $257 a year on every slave he owned and spent only $12 or $13 for the slave’s keep. Slavery is a very profitable system (which explains why it still exists in many parts of the world). Sharecroppers who must give a third or half their crop to the landowner are also obviously exploited. Under capitalism, however, the portion taken from the worker is not visible. Workers are simply paid substantially less than the value they create. Indeed, the only reason they are hired is to make money off their labor. If wages did represent the total value created by labor (after expenses and improvements), there would be no surplus value, no profits for the owner, no great fortunes for those who do not labor.
The value distributed to the owners is apart from workers’ wages or even executives’ salaries; it consists of profits—the money one makes when not working. The author of a book, for instance, does not make profits on his book; he earns a recompense (fancily misnamed “royalties”) for the labor of writing it. Likewise, editors, proofreaders, printers, and salespersons all contribute labor that adds to the value of the book (usually). Profit on the book goes to those who own the publishing house and who contribute nothing to the book’s marketable value. The sums going to owners are aptly called unearned income on tax reports.
While corporations are often called “producers,” the truth is that they produce nothing. They are organizational devices for the exploitation of labor and accumulation of capital. The real producers are those who apply their brawn, brains, and talents to the creation of goods and services. The primacy of labor was noted in 1861 by President Abraham Lincoln in his first annual message to Congress: “Labor is prior to, and independent of, capital. Capital is only the fruit of labor, and could never have existed if labor had not first existed. Labor is the superior of capital, and deserves much the higher consideration.” Lincoln’s words went largely unheeded.
Capitalists like to say they are “putting their money to work,” but money as such does not work. What they really mean is that they using their money to put human labor to work, paying workers less in wages than they produce in value, thereby siphoning off more profit for themselves. That’s how money “grows.” Capital annexes living labor in order to convert itself into goods and services that will produce still more capital.3 All of Rockefeller’s capital could not build a house or a machine or even a toothpick; only human labor can do that. Of itself, capital cannot produce anything. It is the thing that is produced by labor.
Persons of great wealth can get quite annoyed when it is pointed out that they do not work. Since many of them equate work with whatever activity they happen to pursue, they do not see themselves as parasitic idlers. When asked, they will tell of their endeavors: serving with a charity organization or on a church or museum board of directors; running for public office; studying art, photography, or ceramics; writing a personal memoir; raising horses; preparing for a long sailing expedition up the coast, an exploration in Indonesia, or a shopping trip to Paris or London; or going on a spiritual retreat or to a health spa to work on their personal development.
Some wealthy individuals actually do work in the more usual sense. They pursue professions and occupy managerial posts—but it is out of personal choice, not economic necessity. Such labor would seem to entitle them to a fair recompense, not an immense fortune. Some prominent tycoons, whose names regularly appear in the press, manage vast financial empires. But the workday they put in, no matter how arduous, does not explain the source of their immense wealth nor the pace at which it accumulates. The far greater portion of their money still comes from the acquisition of assets that directly or indirectly engage the labor of others. This perpetual transference of value is the less conspicuous part of their otherwise highly publicized careers.
The power of the wealthy business class is like that of no other group in our society. The giant corporations control the rate of technological development and availability of livelihoods. They relegate whole communities to destitution when they export their industries overseas to cheaper labor markets. They devour environmental resources, stripping our forests and toxifying the land, water, and air. They command an enormous surplus wealth while helping to create and perpetuate conditions of scarcity for millions of people at home and abroad. And they usually enjoy a predominating voice in the media and the highest councils of government.
That they can reach so deeply into our society and culture while incurring relatively little critical attention is itself a measure of their ideological hegemony.
26 WEALTH, ADDICTION, AND POVERTY
In order that a select few might live in great opulence, millions of people work hard for an entire lifetime, never completely free from financial insecurity, and at great cost to the quality of their lives. The complaint made against this social arrangement is not that the very rich have so much more than the rest of us but that their superabundance and endless accumulation comes at the expense of everyone and everything else, including our communities and our environment.
Furthermore, the absence of money is what makes the have-nots and have-littles relatively powerless, depriving them of access to wider publics and severely limiting their influence over political life. As the gap between the corporate rich and the general populace grows, the opportunities for popular rule diminish.
One does not have to be destitute and jobless to experience the stress and scarcity of a corporate economy. Even people with fairly well-paying jobs can face cutbacks in pay, speedups, loss of seniority, layoffs, loss of health insurance and other benefits, run away housing and medical costs, and persistent debt. Economic insecurity and income inequality have increased considerably since 1978. Real wages (wages adjusted for inflation) have remained flat or have declined; labor unions are fewer and weaker; still greater subsidies and giveaways go to corporate America as the public sector increasingly supports the private sector; and massive cuts in taxes go to the superrich.
This picture is at variance with the accepted “trickle-down” ideology of modern capitalism which says that as the economy booms, and investments and profits increase, so do wages and general prosperity. As the pie gets bigger, we all get a larger slice. “A rising tide lifts all boats,” the saying goes. But in these days of reactionary ascendancy, a rising tide lifts all yachts and drowns many people.
In certain respects the political economy really is zero sum. No rent control means higher rents, more for the landlords, and less disposable income for the renters. Wage cuts for the workers means more for the owners. Conversely, more for the workers means less for the owners. Every dollar the employer has to spend on such annoying things as wages, benefits, occupational safety, and environmental protection, is one less dollar pocketed as profits.
The corporate ideology maintains that capitalism creates prosperity not poverty; just look at the prosperity of capitalist North America and capitalist Western Europe. But that is a very selective view of capitalism. I would argue the reverse: class wealth creates poverty. Put aside the fact that in the United States there are millions who live in hardship and serious want, let us look elsewhere. Quite simply, most of the world is capitalist and getting more capitalist, yet most of the world is poor and getting poorer. Capitalism works best in the poor countries, where wages are low, regulations and human services are paltry, and unions are weak or nonexistent; the result is that profit margins are higher than ever. Look at capitalist countries like Indonesia, Nigeria, Mexico, the Philippines, Haiti, Thailand, El Salvador, and so many others—all so capitalist and all so poor. Their populations get still poorer while a handful of transnational corporate investors get ever richer off them.
What is the imperative that propels wealthy individuals and their powerful financial organizations? In large part it is the desire, even the necessity, to accumulate still more wealth. “Accumulate, accumulate, accumulate,” as Marx put it. Why? Those who have billions of dollars, who have more money than they know what to do with, why would they want still more and more? There are several reasons:
First, wealth can become addictive. Fortune whets the appetite for more fortune. There is no end to the amount of money one might desire to accumulate, giving oneself over to the auri sacra fames, the cursed hunger for gold, the desire to possess more wealth than can be consumed in a thousand lifetimes of limitless indulgence.
Wealth buys every comfort and privilege that is available, elevating the possessor to the highest social stratosphere, an expression of the aggrandizing self, leaving one feeling almost invulnerable to time and mortality. Wealth is an extension of one’s existence beyond the grave. There is little desire to see your fortune dispensed or scattered after you depart from this world. Years ago a comedian wisecracked: “If I can’t take it with me, I’m not going.” The comment touches a real sentiment. If you can’t take it with you, the next best thing is to keep it going after you’re gone. The thought of breaking up one’s estate into, say, four smaller parts for one’s four offspring becomes painful. Worse, it is dangerous to the family’s standing. If one great family fortune is reduced to four relatively modest holdings, the family slips in social standing.
So there was invented the custom of primogeniture: the oldest son inherited the entire estate and kept it intact. The other sons had to make do with going into the upper echelons of the military, the church, or the diplomatic corps. The daughters were married off to other families of fortune whenever possible. Failing that, they were sent to the nunnery or left to live out their dreary days in the lonely comforts of the family manor. Such is the addictive nature of wealth, keeping all of it together, always adding to it, never subtracting. The family wealth is immortalized in order to secure the family name and fortune—though not necessarily the well-being of all family members.
In modern times things do not always work that neatly. Great fortunes can sometimes breed fractious family dynasties, as siblings and other relatives contest for a cut of the inheritance in messy clashes that spill into public view, a far cry from the older practice of primogeniture.
Another reason for the relentless accumulation of wealth is less psychological and more systemic. Even in today’s monopolistic oligopoly where a few corporate giants dominate each field of commerce and mergers are the rule, capitalism is still a potentially insecure system for the capitalist (as well as for everyone else). Markets change, new competitors with new technologies enter the fray, suppliers turn elsewhere, consumer tastes prove transient, investments backfire.
The competitive investment system requires constant expansion, from local to regional to national to international scope. The companies that grow are the ones most likely to survive. In 2006 Wal-Mart, the world’s largest retailer, reportedly was going to build a chain of five hundred outlets in China. “For Wal-Mart, China represents an opportunity to tap a vast and fast-growing market abroad at a time when the company’s sales are lagging elsewhere and it has run into obstacles to expansion at home.”4 In short, even the very biggest of corporations never feels perfectly secure unless they are accumulating in still greater quantities.
Of course there are exceptions. Some small companies with specialized markets and devoted clientele do well enough without perpetual growth. Still, global mergers and expansion are the general pattern. To remain in one place usually is to lose ground, not just relatively but absolutely, as competitors gain an edge that some day might prove fatal if carried too far.
In addition, one’s accumulated wealth is rarely totally safe. It might get expropriated or plundered by other forces: revolution, insurrection, invasion, natural disaster. Or it might be lost through devaluation, inflation, overproduction, insider looting, market crash, or some other failure to realize its value. The safest way to remain very rich is to get still richer, coming out on top, never on bottom. Given this rat race, the tendency is for wealth to be pursued without moral restraint. Like any addiction, or any systemic imperative, money is pursued in that singleminded way, with a disregard for what is right or wrong, just or unjust, helpful or harmful to others.
If the workforces of the world are being downsized and wages are stagnating, where will purchasing power come from? Who will buy all the goods and services produced by overworked and underpaid employees? This question is often asked. The elites are cutting their own throats, the argument goes, and sooner or later they will have to reverse their policies as consumption diminishes. Indeed, a major preoccupation of the financial sector is overcapacity. There is overcapacity in Brazil, Indonesia, Japan, the United States, and numerous other countries. This is a real problem that capitalism chronically faces. But there are several mitigating factors.
First, though people may be working for proportionately lower real wages in the United States, more of them are working. Despite all the downsizing, millions of new but poorer paying jobs are being created every year. In many households, the collective family wage has been maintained because the male breadwinner (who might now have a poorer paying job) has been joined in the job market by his wife and one or two of the older children. Instead of going off to school or getting their own living quarters, the offspring stay at home because it is affordable, get a job, and contribute to the household income.
Second, we not only have the two- and three-job family but the two- and three-job person. People are working longer hours. Economists say that the average workweek is close to record levels. Overtime is more common, although time-and-a-half pay for overtime is becoming less common. In states like Texas, white-collar salaried workers in many firms are expected to stay well into the evening, come to the office on weekends, and put in an eighty-hour week if asked to do so. Workers are still buying things but they have to work harder and longer to do so. Of course, if you have to work harder to stay in the same place, you are not staying in the same place. In fact, you are losing ground, giving more of your life energy and labor power, but getting back relatively less in return.
Third, for the big-ticket items—durable-use goods like cars, refrigerators, and homes—there is installment buying. The consumer debt is climbing precipitously. Those with lots of extra money need to do something with it, so they lend it to those in need—at a price. Here is an area of poverty that is also a source of profit for rich creditors.
Fourth, the government keeps the economy going by massive deficit spending, a large chunk of which goes to the military. To make up for these deficits, the government borrows from rich financial interests at home and abroad. The accumulation of these yearly deficits is what we call the national debt, amounting to upwards of $9 trillion as of the end of 2006. Over the last two decades, the U.S. national debt has skyrocketed by 120 percent or so, mostly driven by conservative presidents: Ronald Reagan, George H. W. Bush, and his son, George W. Bush. The U.S. national debt is larger than the national debts of all Third World nations combined.
Conservatives like a big deficit because it represents an upward transfer of income from those who are eventually held responsible to pay it (the general public) to those who hold the notes on the debt (rich creditors). A massive national debt is a way of privatizing the public treasury. The bigger the debt, the larger the portion of the federal budget that finds its way back into the coffers of private creditors, as the government continues to borrow from those it should be taxing.
Fifth, demand is increasing among the very rich. Even during recent recession years, the sales of highly expensive jewelry, antiques, artwork, executive apartments, mansions, vacation homes, yachts, luxury cars, and fabulous excursions abroad boomed among upper-class clientele.
Sixth, there probably will always be some sort of middle-class consumption. In the United States there are some ten million professionals, upper and middle corporate managers and government bureaucrats, small investors, and small but successful entrepreneurs who do well enough. Even in a country like India, with a vast impoverished population of a billion people, there are some 80 million who might be designated as middle class, a consumer market much larger than the entire consumer population of most industrialized European nations.
Seventh, it should be noted that the present forced rollback in the United States started from a relatively high level of consumer abundance. With downsizing, the pie may expand at a slower rate or even get a little smaller, but if the plutocrats at the top keep getting larger and larger slices, they are not much troubled about sluggish demand.
The poor shall always be with us, says the Bible. Indeed, that will be so—as long as the superrich also are with us. For wealth and poverty do not just exist in an unfortunate but innocent juxtaposition. They endure in a close dynamic interrelationship. Wealth creates poverty and relies on it for its own continued existence. Without slaves how could the slaveholder live in the lavish style to which he is accustomed? Without serfs or overworked peasants, how could the lord be to the manor born? Without the working poor, how could the leisurely rich make do? With no underprivileged, who would be privileged? As Gilbert and Sullivan said, “If everybody is somebody, then nobody is anybody.”
Economic downturns, or what is popularly known as “hard times,” are not unmitigated gloom, at least not for the giant transnational corporations. During recessions, smaller competitors are weeded out, unions are weakened and often broken, and a reserve supply of unemployed workers grows in number, further helping to depress wages. And depressed wages increase profit margins. In recessions, profits rise faster than wages; indeed, in the severer slumps, wages are not likely to rise at all.
The idea that all Americans experience good and bad times together should be put to rest. Even as the economy declines, rich investors grow richer by grabbing a still bigger slice of whatever exists. During recent recessions, corporate profits rose to record levels, as companies squeezed more output from each employee while paying less in wages and benefits.
Former Secretary of the Treasury Nicholas Brady once remarked that recessions are “not the end of the world” and “no big deal.”5 Certainly not for Brady, who rested comfortably on a handsome fortune, and certainly not for his wealthy associates, who welcomed the opportunity to acquire bankrupted holdings at giveaway prices. Brady and friends understood that the comfort and prosperity of the superrich require an abundant supply of those who, spurred by the lash of necessity, toil as servants on rich estates, tend the country club grounds, serve the banquet luncheons, work the mines, mills, fields, and offices, performing a hundred thankless and sometimes health damaging tasks for paltry wages so that Brady and company can live in the style to which they are accustomed.
Worse still, poverty is not just a material condition. It is not just about income levels, consumption patterns, and employability—as some middle-class economists seem to think. For those who have known it firsthand, poverty is an encompassing oppression. It permeates and muddies all other life experiences. Not having enough money for food or rent; not having a place to live, sleep, and bathe; not being able to get needed medical care; these are not just material hardships, they are conditions that stress the soul and damage the spirit. And in an increasingly industrialized and urbanized society organized around high consumption and high prices, the poor find even less opportunity to create pockets of sustenance and survival.
Although they are getting ever wealthier, today’s superrich are paying fewer taxes, if any at all, while the poor see their limited resources cut back further and their hopes grow dimmer. With free-market globalization, the same pattern emerges abroad. Poverty is spreading as wealth accumulates in ever greater concentrations. Again, it is no coincidence. Wealth battens on poverty.
In most instances, working people are not the authors of their own oppression but victims of the inequities and iniquities of corporate coteries whose consuming need for more and more accumulation creates the tragedies of history, big and small, personal and global.
27 MONOPOLY CULTURE AND SOCIAL LEGITIMACY
In the realm of governance, the economically dominant class is also the politically dominant. Lest this assertion be dismissed as a tired Marxist shibboleth, we should note that throughout much of the seventeenth, eighteenth and early nineteenth centuries, leading bourgeois theorists and philosophers saw the linkage between wealth and political hegemony, and readily accepted it as a necessary and desirable social feature. The English political philosopher John Locke wrote in 1689: “The great and chief end of Men’s uniting into Commonwealths and putting themselves under Government, is the Preservation of their Property.”6 Adam Smith wrote in 1776: “The necessity of civil government grows up with the acquisition of valuable property.” And “till there be property there can be no government, the very end of which is to secure wealth, and to defend the rich from the poor.” Civil authority, Smith went on, “is in reality instituted for the defense of the rich against the poor, or of those who have some property against those who have none at all.”7 (Parenthetically we might remind ourselves that from ancient Athens to today the historic purpose of democratic government has been the reverse, to protect the poor from the rich.)
The framers of the U.S. Constitution understood the class nature of the state. In 1787, while ostensibly cobbling together a representative republic, they repeatedly asserted that an essential purpose of governance was to resist the “leveling tendencies of the masses” and to secure the interests of affluent property holders against the competing demands of small farmers, artisans, and debtors. In short, they wanted a stronger state in order to defend the haves from the have-nots.8 In Federalist No. 10, James Madison wrote that “the most common and durable source” of divisions and conflict within a polity “has been the various and unequal distribution of property [wealth]. Those who hold and those who are without property have ever formed distinct interests in society” and “the first object of government” is “the protection of different and unequal faculties of acquiring property,” so that those who possess great wealth are not hampered in any way by those who do not. That is not the only function of government, according to Madison, but it is “the first object.”
The state power of the dominant economic class, however, never stands alone. A class that relies solely on the state’s police and military to maintain its rule is never really secure. As Napoleon once said, one can do anything with bayonets except sit on them. Behind the state is a whole supporting network of doctrines, values, myths, and institutions that are not normally thought of as political. The state, as Antonio Gramsci noted, is “only the outer ditch behind which there [stands] a powerful system of fortresses and earthworks.”9 These auxiliary institutions help create the ideology that transforms a ruling-class interest into a “general interest,” justifying existing class relations as the only natural and optimal—albeit not perfect—societal arrangements. Hence, along with monopoly capital we have monopoly culture. In other words, modern corporate capitalism is not just an economic system but an entire social order.
Ideologically conventional observers resist such a notion of ruling- class cultural hegemony. They see social institutions as autonomous and neutral configurations, largely independent of any linkage to business power and the state. They treat culture as something distinctly separate from—and even competitive with—politics. They talk about keeping our social institutions free of the taint of political ideologies.
A closer look reveals that cultural institutions such as the media, publishing houses, professional sports, entertainment enterprises, and most hospitals are not merely influenced by business ideology but are themselves profit-making corporate conglomerates. Furthermore, nonprofit cultural institutions like schools, museums, scientific and research associations, foundations and universities are tied by purchase and persuasion, by charter and power, to capitalist-class interests, ruled much like the profit-making ones—by boards of directors (or trustees or regents), drawn mostly from the corporate business class or from the ranks of loyal acolytes in the employ of that class. These boards have final say over the institution’s system of rewards and punishments, its budget and personnel, its investments and purposes. They exercise power either by occupying the top positions or hiring and firing those who do. Their power to change the institution’s management if it fails to perform as they desire is what gives them control over operations.
The boards of directors exercise authority not by popular demand but by state charter. Incorporated by the state, they can call upon the courts and police to enforce their decisions against the competing claims of staff, clients, or other constituents. These boards are unaccountable to the institution’s rank and file or the general public, whose lives they might affect with their decisions. “When the state acts to protect [corporate] authority, it does so through the property system; that is, it recognizes the corporation as the private property of some determinate group of [persons] and it protects their right to do, within legal limits, what they please with their property.”10 Yet, institutions so ruled are said to be the mainstay of democratic pluralism.
In a word, social institutions are controlled by the more active members of the business class in what amounts to a system of interlocking and often interchanging directorates. We know of more than one business leader who not only presides over a bank or corporation but has served as a cabinet member in Washington, is a regent of a large university, a trustee of a civic art center, and at one time or another a member of the board of a major newspaper, a church, a foundation, or a television network. This pattern became evident by the latter part of the nineteenth century as capitalism came to maturity and capitalists moved to achieve a cultural hegemony that would be useful to their economic dominance. As one historian describes it:
In short order the railroad presidents, copper barons, the big dry-goods merchants and the steel masters became Senators, ruling the highest councils of the national government . . . but they also became in even greater number lay leaders of churches, trustees of universities, partners or owners of newspapers or press services and figures of fashionable, cultured society. And through all these channels they labored to advance their policies and principles.11
With command over organizational structure, personnel, and budget, the owners and trustees pretty much call the tune. They may not be able to exercise perfect control over every note that is played but employees who stray too far from the score, who create too much cacophony, eventually find themselves without pay or position. Along with the punishments there are the rewards for compliance—the grants, fellowships, commissioned studies, honorary awards, special programs, promotions, top appointments, conference invitations, fat lecture fees, junkets, and other such career enticements.
Cultural dominance provides a number of payoffs for the plutocrats:
First, cultural institutions such as the media, and the health and entertainment industries are a major source of capital accumulation. Capitalists are involved in them because they make lots of money from them.
Second, nonprofit institutions such as universities, professional schools and research centers provide the kind of services and trained personnel that business does not want to pay for itself. When capitalists realized they needed literate, punctual and compliant machinists, they then favored public schools. When they needed lawyers, engineers and managers, they approved of professional and technical schools. The substantial public funds used to sustain these institutions represent an indirect public subsidy to the private sector.
Third, these institutions are crucial instruments of ideological and class control, socializing people into values that are functional to the existing system, while suppressing perspectives that are not.
Fourth, not only through propaganda and socialization but also through “good works,” or the appearance of such, do plutocrats achieve hegemonic legitimacy. The ruthless industrialist becomes the generous philanthropist; the expropriator becomes “a leader of society,” a trustee of our social and cultural needs. This was a conscious policy on the part of some moneyed leaders. 12 To appreciative American audiences Mobil Corporation was for years better known as the sponsor of Masterpiece Theater than as the heartless exploiter of oil workers in the Middle East and elsewhere. Cornell, Johns Hopkins, Clark, Duke, Vanderbilt, Tulane and Stanford are no longer ruthless tycoons but prestigious universities. And Carnegie is remembered not for the workers he starved and attacked, but for his Hall, his Institute, and his Endowment.
The primary goal of capitalist cultural dominance is not to provide us with nice concerts and museums but to give capitalism’s exploitative reality a benign gloss and providential appearance so that people learn to accept and admire the “stewardship” of the owning class. So some say, “More for the rich means more for the rest of us because they create the jobs we need” and, “they do a lot of other good things for society.”
In fact, some of their undertakings do have beneficial spinoffs. This brings us back to Antonio Gramsci’s insights about how hegemony works to induce the people to consent in their own oppression. Gramsci noted that the capitalist class achieves hegemony not only by propagating the self-serving values, attitudes and beliefs but by actually performing vital social functions that have diffuse benefits. Railroads and highways may enrich the magnates, but they also provide transportation for much of the public. Private hospitals are for-profits not for people, but people who can afford them do get treated. The law is a class instrument, but it must also to some degree be concerned with public safety.
Gramsci notes that if a ruling class fails to keep up the appearance of being concerned for the public interest at least some of the time, its legitimacy will decline, its cultural and national hegemony will falter and its power will shrink back to its police and military capacity, leaving it with a more overtly repressive but ultimately less secure rule.13
The struggle for democratic change is long and difficult, but progressive victories are not impossible. The ruling class rules, but not quite in the way it wants. Its socializing agencies do not work with perfect effect. To maintain popular acceptance and democratic appearances it must lie, distort, and try to hide its oppression and unjust privileges. Occasionally it even must make concessions to popular demands.
In time, the legitimating ideology propagated by the plutocracy becomes a two-edged sword. Hypocrisies that rulers mouth about “democracy” and “fair play” are more than just the tribute vice pays to virtue. Such standards put limitations on ruling-class oppression once the public takes them seriously and fights for them. Legitimacy cuts both ways within cultural institutions. The danger with calling the oligarchic university a “democratic institution” is that students and faculty may take the assertion seriously and demand the right to ideological diversity and self-governance.
In sum, monopoly culture, like monopoly economy, suffers from internal contradictions. It can invent and control just so much of reality. Its socialization is imperfect and not without vulnerabilities. It cannot rest absolutely secure because it does not serve the people, yet it must pretend that it does. Its legitimating deceptions are soft spots of vulnerability, through which democratic forces can sometimes press for greater gains.
An understanding of monopoly culture shows us how difficult it is to fight capitalism on its own turf, but sometimes it is the only turf available. At the same time, we must continue to create alternatives to monopoly culture—alternative media, films, art, schools, and scholarship. But such a “counterculture” must be grounded in an alternative politics so that it confronts rather than evades the realities of class power and avoids devolving into cultural exotica and inner migration. It is easier to shock the plutocracy with cultural deviance than to defeat it with mass revolutionary organization.
The struggle for democracy is, among other things, a struggle to win back the entire cultural and social life of the people, so that someday we can say this land is our land, and so too this art and science, this learning and healing, this prayer and song, this peace and happiness.
28 THE FLIGHT FROM CLASS
Writers of varying political persuasions, including some who consider themselves to be on the left, maintain that class is a concept that is no longer preeminently relevant to understanding what is happening in society. Class is dismissed out of hand as an outworn Marxist notion. At a conference at Brown University years ago, I heard the anarchist Murray Bookchin assert, “There are no classes, only people.”
Dissident ideas become all the more difficult to express when there are no acceptable words to express them. With the C-word out of the way, it is then easy to dispose of other “irrelevant” concepts such as class privilege, class interest, class power, class exploitation, class conflict, and class struggle.
When acknowledged at all, the concept of class is treated as nothing more than an occupational status, an educational or income level, or a social lifestyle. Thus reduced to a set of demographic traits, one’s class affiliation certainly can seem to have a relatively low political salience, less significant than, say, race, gender, sexual orientation, or other components of “identity politics.” Society itself is perceived as little more than a pluralistic configuration of status groups, having nothing to do with the dynamics of wealth and power. In this way have many observers perfected the art of looking at class in capitalist society without ever having to look at capitalism itself.
But class, as used by those who are awake to broader social dynamics, has another meaning: it describes an interrelationship. Classes get their definition from each other. One cannot think of a class as just existing unto itself. There can be no slaveholders without slaves, no lords without serfs, no capitalists without workers. The crucial axis of the relationship, however, is not between the two classes as such but pertains to the relationship each class has to the means of production, to ownership (or nonownership) of the land, industry, and wealth of society, and to the exploitative nature of the process of production and capital accumulation.
This defining relationship involves a conflict of material interests between those who own and those who work for those who own. Class gets its significance from the process of surplus extraction. The relationship between master and slave, lord and serf, boss and worker is essentially an exploitative one, involving the constant transfer of value from those who labor (but do not own) to those who own (but do not labor). This explains how some people can get ever richer without working or with doing only a fraction of the work that enriches them, while others toil hard for an entire lifetime only to end up with little or nothing.
Those who occupy the higher perches of wealth and power are keenly aware of their favored position. While they occasionally differ among themselves on specific issues, they exhibit a workable cohesion when it comes to protecting the overall class system of corporate power, property, privilege, and profit. At the same time, they are careful to discourage public awareness of the class power they wield. They avoid the C-word, especially when used in reference to themselves as in “owning class,” “upper class,” or “moneyed class.” And they like it least when the politically active elements of the owning class are called the “ruling class,” or plutocracy. This country’s superrich owning class labors hard to engineer the impression that it does not possess the lion’s share of wealth and investment, and does not exercise a vastly disproportionate influence over the affairs of the nation. Such an unwillingness to discuss class power is not symptomatic of a lack of class consciousness, quite the opposite.
Conservative ideologies justify existing socio-economic inequities as inevitable outcomes of largely innate human proclivities. But if the very rich are just naturally superior to the rest of us, why must they be provided with so many artificial privileges under the law, so many government protections, services, bailouts, subsidies, and other special considerations—at our expense? Their “naturally superior talents” include unprincipled and illegal subterfuges such as price-fixing, stock manipulation, insider trading, fraud, tax evasion, unfair competition, bribery, rigged laws, ecological spoliation, labor-contract violations, harmful products, and unsafe work conditions. One might expect naturally superior people not to act in such morally inferior ways. Differences in talent and capacity as might exist between individuals do not excuse the endemic venality, rapacity, hypocrisy, and crimes.
The idea that wealth is constantly being transferred from the labor of many into the accounts of the few is widely at variance with the established notion that the relationship between rich and poor, owner and worker, is not exploitative but symbiotic. The question “Where would workers be without the company?” is more likely to be asked than “Where would the company be without workers?” Worker and owner are supposedly engaged in a mutually beneficial “teamwork.” Such class collaboration is presumed beneficial to all. Conversely, class strife is seen as harmful to all.
Even among persons normally identified as progressive, one finds a reluctance to deal with the reality of capitalist class-power. Sometimes the dismissal of the C-word is quite categorical. At a meeting in New York in 1986 I heard the sociologist Stanley Aronowitz exclaim, “When I hear the word ‘class’ I just yawn.” Through the whole evening he never used the term “Marxist” without preceding it with the loaded adjective “orthodox,” as if by definition Marxism was a set of rigid dogmatic beliefs, and not a fruitful mode of inquiry.
Aronowitz’s self-appointed task is, in his words, “to interrogate Marxists’ habitual separation of political economy and culture and to make a contribution to their articulation, even reunification.” 14 But his dismissive boredom with the term “class” and his energetic bludgeoning of something he calls “orthodox Marxism” would suggest that he is more interested in replacing class analysis with cultural explanations than in linking class and culture. While claiming that the two concepts are complimentary, he seems to treat them as adversarial.
Aronowitz was one of several people who edited Social Text, a journal devoted to articles that specialize in impenetrable verbiage and niggling academic one-upmanship, supposedly representative of a field called “cultural studies,” whose primary function seems to be to deny the importance and centrality of class power. (That the journal’s writings are seldom connected to the real world was demonstrated in 1996 by physicist Alan Sokal, himself a leftist, who wrote a parody and submitted it to Social Text. Sokal’s piece was laden with bloated but trendy hypertheorized jargon and many footnoted references to the likes of Jacques Derrida and Aronowitz himself. It purported to be an “epistemic exposition” of “recent developments in quantum gravity” and “the space-time manifold” and “foundational conceptual categories of prior science” that have “become problematized and relativized” with “profound implications for the content of a future post-modern and liberatory science.” Various Social Text editors, including Aronowitz, read and accepted the piece as a serious contribution. After they published it, Sokal revealed that it was little more than fabricated gibberish and hot air that “wasn’t obliged to respect any standards of evidence or logic.” In effect, he demonstrated that the journal’s editors were themselves so profoundly immersed in pretentiously inflated, obscurantist, and incomprehensible discourse as to be unable to distinguish a genuine intellectual effort from a silly hoax. Aronowitz responded by calling Sokal “ill-read and half-educated.”15)
Another left academic, Ronald Aronson, claims that classes in capitalist society have become “less polarized” and class exploitation is not an urgent issue nowadays because labor unions “have achieved power to protect their members and affect social policy.” 16 This at a time when many unions were being destroyed, real wages were slumping, the income gap was wider than in decades, and the number of people living in poverty throughout the capitalist world was (and still is) growing at a faster rate than the world’s population.
The left anti-class theorists say we are giving too much attention to class. Who exactly is doing that? Surveying the mainstream academic publications, radical journals, and socialist scholars conferences, one is hard put to find much class analysis of any kind. Far from giving too much attention to class power, most of these theorists have yet to discover the subject. While perpetually pummeling a rather minuscule Marxist left, they would have us think they are doing courageous battle against hordes of Marxists who dominate intellectual discourse in this country—yet another hallucination they share with conservatives.
Almost any allusion to class is likely to elicit a negative response from academics. Years ago, in a discussion with Harold Isaacs, a faculty member at MIT, I suggested that much of what we define as “ethnic” is really representative of a common class experience, so that in many respects, urban working-class ethnic groups manifest, along with distinctly different traits, many similar ones because of their being similarly situated in the class structure. Having arrived at this hypothesis after years of work in ethnic studies, I thought it was worthy of further consideration. But Isaacs was not happy to hear it. “Well, if you want to fall back on a Marxist viewpoint, you can,” he said. His response puzzled me. Like any red-blooded American social scientist, I was at that time blithely ignorant of what Marxists might be saying about ethnicity or most other subjects. Yet the mere idea that class should be taken into account was enough for him to equate my suggestion with Marxism. To be sure, there is nothing inherently wrong in having one’s views thought of as Marxist. What is wrong is the habit of immediately rejecting an idea as deficient or dogmatic because it has been labeled “Marxist.”
To support their view that class struggle is passé, the left anti-class theorists repeatedly assert that there is not going to be a workers’ revolution in the United States in the foreseeable future. (I heard this sentiment expressed at three different panels during what purported to be a “Gramsci conference” at Amherst, Massachusetts, in April 1987.) Even if we agree with this prognosis, we still might wonder how it becomes grounds for rejecting class analysis and seeing class struggle as of no import. The feminist revolution that was going to transform our entire patriarchal society has thus far not materialized, yet no progressive person takes this to mean that sexism is a chimera or that gender-related struggles are of no great moment. That workers in the United States are not throwing up barricades does not mean class conflict is a myth. In present-day society, such struggle permeates almost all workplace activities. Management constantly wages class war using court injunctions, anti-labor laws, lobbying, tax cuts for the superrich, police repression, union busting, contract violations, sweatshops, dishonest clocking of time, forced and unpaid overtime, safety violations, speedups, harassment and firing of resistant workers, cutbacks in wages and benefits, layoffs, plant closings, outsourcing to cheaper labor markets, and pilfering pension funds.
Workers fight back—when they can—with union organizing, strikes, slowdowns and other job actions, boycotts, public demonstrations, legal appeals, electoral struggle, coordinated absenteeism, and workplace sabotage. “The class struggle is never absent, right down to an argument over whether a worker has spent too long in the lavatory, or whether they have the right to go the lavatory if they wish.”17
Class power may not be the only factor, but it is an important one in setting the political agenda, selecting leaders, determining public budgets, silencing dissenters, and funding scientific research. Class is a major determinant in how people gain access to higher education, how health care is distributed, how the environment is (mis)treated, how the elderly try to survive, how women and people of color are dealt with, and how religion, news, entertainment, art, and sports are marketed.
Left anti-class theorists like the hyper-theorizing Chantal Mouffe define the working class as composed only of industrial proletarians. This definition excludes farm workers, service workers, and white-collar employees. It enables the anti-class theorists to see the working class as on the way out, declining in numbers and importance. When I once observed that the Nicaraguan Revolution was a “working-class victory,” Mouffe vehemently objected, stating that the Nicaraguan Revolution was “a popular uprising.” But who is the populace? Was the Sandinista victory carried out by a leisure class? By a small professional class? In Nicaragua and other countries, a popular uprising and a working-class uprising are much the same thing.
A grasp of class reality vastly superior to Chantal Mouffe’s was evidenced by George Rohal, a supermarket manager in Weirton, West Virginia, and the son of a steelworker. Rohal commented, “All classes are really working classes. Very few people sit back and just collect income. Anyone drawing any type of salary or a weekly paycheck is a working-class person.”18 This might not be true of the very top corporate CEOs, whose huge salaries are well complemented by enormous investment earnings and whose wealth and organizational command positions give them an inescapable identity with the owning class, yet Rohal’s comment contains a core insight. Having never read the anti-class theorists and mainstream social scientists, he is able to see that class is a relationship to ownership and not just a demographic characteristic.
By the 1980s “the retreat from class” became something of a stampede, most notably in countries like France and the United States. For those who sought to be au courant, class oppression and class struggle now seemed terribly passé. During the seventies and eighties, the anti-class theorists set sail for seemingly more inviting ports, announcing that the future belonged to the Greens, the feminists, the gays, the political culturalists—or even the free market and the ideological right. Few people wanted to associate with a loser, and class struggle seemed like a loser.
Various “left” theorists devoted yet more time to Marxist bashing. Anyone who still thought that class was of primary importance was labeled a diehard Marxist, guilty of “economism”19 and “reductionism” and unable to keep up with the “post-Marxist,” “post-structuralist,” “post-industrialist,” “postmodernist,” and even “post-capitalist” times.
Explaining why, like so many other French intellectuals, she shifted away from Marxism and from studying working-class history, Michelle Perrot remarked: “After the war, the working class was highly visible; we believed that it was the vanguard. To do working-class history was one way of being an intellectual.”20 A revealing admission by Perrot. She did not side with the working class because of the inherent question of economic justice, but because “the working class was highly visible,” and an identity with the class was largely a means to another end, that of being a certified intellectual. And now, when the working class is perceived as “declining in importance,” the anti-class theorists move on to matters more deserving of their attention, announcing the advent of a post-something-or-other era, and marketing a new line of threadbare ideas. The intellectual life resembles the fashion industry in more ways than one.
Rather than treating class, race, culture, and gender as mutually exclusive and competitive concepts, we need to see how they interact, often with compound effect. The resurgence of racism is not proof that class realities are thereby less important. Indeed just the opposite. Racial and ethnic divisions are often incited as a way of retarding class consciousness and unity.
Consider the way the left anti-class theorists have misused Antonio Gramsci, an Italian Communist Party leader and intellectual of the 1920s. Gramsci made much of the fact that cultural hegemony was one of the ways the bourgeoisie maintained itself and buttressed state power. In emphasizing the importance of cultural hegemony, he did not mean to downplay the significance or centrality of class. Quite the contrary, he was showing how culture was a force instrumental to class struggle. Gramsci would have been appalled at those theorists who try to use his work as a weapon against Marxism, since he himself was a Marxist-Leninist.
When Marxists and other social critics argue that the class dimension is of primary importance, they are being neither reductionist nor “economistic,” for they continue to recognize the multifaceted nature of social phenomena. That all human activity has a material base does not mean that all human activity is reduced to material motives but that it is all anchored within the overall structure of politico-economic power.
While all things cannot and should not be reduced to class, class does penetrate so much of our social experience. An economically dominant class is able to hold sway over other social institutions and cultural forces in society—albeit not in all matters for all time. The capitalist class is dominant but not omnipotent. One of the prime conditions of that class’s hegemony is the ability to mute and blur class awareness. In this they have plenty of allies across the political spectrum.
NOTES
1. Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations (Modern Library, 1937), 33.
2. See Victor Perlo’s columns in People’s Weekly World, 31 May 1997, and 1 August 1998; and Paul Lawrence, “Capitalism is Organized Crime,” The People, September/October 2003.
3. For the classic statement on capitalism, see Karl Marx, Capital, vol. 1, available in various editions; see also Marx’s A Contribution to the Critique of Political Economy (International Publishers, 1970).
4. New York Times, 17 October 2006.
5. Brady quoted in Lewis Lapham, “Notebook,” Harper’s 26 April 1995.
6. John Locke, Treatise of Civil Government (Appelton-Century-Croft, 1937), 82.
7. Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations (Encyclopedia Britannica, 1952), 309, 311.
8. See Michael Parenti, Democracy for the Few, 8th ed. (Wadsworth/Thomson, 2007), chapter 4.
9. Antonio Gramsci, Selections from the Prison Notebooks, edited by Quinton Hoare and Geoffrey Nowell-Smith (International Publishers, 1971), 238.
10. Michael Walzer, “Civil Disobedience and Corporate Authority,” in Philip Green and Sanford Levinson (eds.), Power and Community (Pantheon, 1969), 226.
11. Matthew Josephson, The Robber Barons (Harcourt Brace and World, 1962), 317.
12. E. Richard Brown, Rockefeller Medicine Men (University of California Press, 1960), 13–59.
13. Gramsci, Selections from the Prison Notebooks; also Edward Greer, “Antonio Gramsci and ‘Legal Hegemony’,” in David Kairys, ed., The Politics of Law (Pantheon, 1982), 306.
14. Stanley Aronowitz, “Alan Sokal’s ‘Transgression,’” Dissent, Winter 1997.
15. New York Times, 18 May 1996; and also Aronowitz, “Alan Sokal’s Transgression.”
16. Ronald Aronson, After Marxism (Guilford Press, 1994).
17. John Downing, The Media Machine (London: Pluto Press, 1980), p. 18.
18. New York Times, April 24, 1978.
19. “Economism” was originally a term used by Lenin to criticize those who thought that the class struggle was entirely encapsulated in the trade union movement. It is now used by anti-Leninists and anti-Marxists to criticize those who see economic factors as of prime importance.
20. “New Subjects, New Social Commitments: An Interview with Michelle Perrot,” Radical History Review 37, 1987, 27.