Leslie Sklair
The concept of transnational practices refers to the effects of what people do when they are acting within specific institutional contexts that cross state borders. Transnational practices create globalizing processes. TNPs focus attention on observable phenomena, some of which are measurable, instead of highly abstract and often very vague relations between conceptual entities. […]
The global system is most fruitfully conceptualized as a system that operates at three levels, and knowledge about which can be organized in three spheres, namely the economic, the political, and the culture‐ideology. Each sphere is typically characterized by a representative institution, cohesive structures of practices, organized and patterned, which can only be properly understood in terms of their transnational effects. The dominant form of globalization in the present era is undoubtedly capitalist globalization. This being the case, the primary agents and institutional focus of economic transnational practices are the transnational corporations.
However, there are others. The World Bank, the IMF, WTO, commodity exchanges, the G7 (political leaders of the seven most important economies), the US Treasury and so on are mostly controlled by those who share the interests of the major TNCs and the major TNCs share their interests. In a revealing report on ‘IMF: Efforts to Advance US Policies at the Fund’ by the US General Accounting Office (GAO‐01‐214, January 23, 2001) we discover that the US Treasury and the Executive Director actively promoted US policies on sound banking, labour issues, and audits of military expenditures. The report concluded that it was difficult to determine the precise significance of US influence, because other countries generally support the same policies. This phenomenon is widely known as the Washington Consensus, a term coined by John Williamson of the Institute for International Economics.
By ‘Washington’ Williamson meant not only the US government, but all those institutions and networks of opinion leaders centered in the world’s de facto capital – the IMF, World Bank, think‐tanks, politically sophisticated investment bankers, and worldly finance ministers, all those who meet each other in Washington and collectively define the conventional wisdom of the moment … [One may roughly] summarize this consensus as … the belief that Victorian virtue and economic policy – free markets and sound money – is the key to economic development.
This is the transnational capitalist class at work. The underlying goal of keeping global capitalism on course is in constant tension with the selfish and destabilizing actions of those who cannot resist system‐threatening opportunities to get rich quick or to cut their losses. It is, however, the direct producers, not the transnational capitalist class who usually suffer most when this occurs as, for example, the tin miners of Bolivia and the rest of the world found out when the London Metal Exchange terminated its tin contract in 1985 and when the Association of Coffee Producing Countries collapsed late in 2001. […]
It may be helpful to spell out who determine priorities for economic, political and culture‐ideology transnational practices, and what they actually do. Those who own and control the TNCs organize the production of commodities and the services necessary to manufacture and sell them. The state fraction of the transnational capitalist class produces the political environment within which the products and services can be successfully marketed all over the world irrespective of their origins and qualities. Those responsible for the dissemination of the culture‐ideology of consumerism produce the values and attitudes that create and sustain the need for the products. These are analytical rather than empirical distinctions. In the real world they are inextricably mixed. TNCs get involved in host country politics, and the culture‐ideology of consumerism is largely promulgated through the transnational corporations involved in mass media and advertising. Members of the transnational capitalist class often work directly for TNCs, and their life styles are exemplary for the spread of consumerism. Nevertheless, it is useful to make these analytical distinctions, particularly where the apparent and real empirical contradictions are difficult to disentangle.
The thesis on which this conceptual apparatus rests and on which any viable theory of the current dominant global system depends is that capitalism is changing qualitatively from an international to a globalizing system. This is the subject of a heated debate in academic, political and cultural circles. The idea that capitalism has entered a new global phase (whether it be organized or disorganized) clearly commands a good deal of support though, unsurprisingly, there are considerable differences on the details. The conception of capitalism of Ross and Trachte convincingly locates the emergence of global capitalism in a series of technological revolutions (primarily in transportation, communications, electronics, biotechnology), and this provides a key support to the global system theory being elaborated here. My focus on transnational corporations draws on a large and rich literature on the global corporation, again full of internal disputes, but based on the premise, well expressed by Howells and Wood that ‘the production processes within large firms are being decoupled from specific territories and being formed into new global systems’. […]
Economic transnational practices are economic practices that transcend state boundaries. These may seem to be entirely contained within the borders of a single country even though their effects are transnational. For example, within one country there are consumer demands for products that are unavailable, in general or during particular seasons, from domestic sources. Retailers place orders with suppliers who fill the orders from foreign sources. Neither the retailer nor the consumer needs to know or care where the product comes from, though some countries now have country of origin rules making mandatory the display of this information. Many campaigning groups make sure that customers know, for example, that some products come from sweatshops in Asia or the USA. There may be a parallel situation in the supplier country. Local producers may simply sell their products to a domestic marketing board or wholesaler and neither know nor care who the final consumer is. Transnational corporations, big or small, enter the scene when sellers, intermediaries, and buyers are parts of the same transnational network.
Hundreds of thousands of companies based all over the world export goods and services. In the US alone in the late 1990s there were more than 200,000 exporting companies according to the website of the US Department of Commerce. Of this large number of exporters only about 15 percent operated from multiple locations, but these accounted for about 80 percent of exports from the US and almost half of manufacturing exports were from the top 50 firms. They, of course, are the major TNCs, comprising the less than one percent of US manufacturers that export to 50 or more countries. Over half of all US export value derives from their transnational economic practices and, significantly, much of their business is comprised of intra‐firm transactions. The picture is similar in many other countries with firms that export manufactured goods. The global economy is dominated by a few gigantic transnational corporations marketing their products, many of them global brands, all over the world, some medium‐sized companies producing in a few locations and selling in multiple markets, while many many more small firms sell from one location to one or a few other locations.
One important consequence of the expansion of the capitalist world economy has been that individual economic actors (like workers and entrepreneurs) and collective economic actors (like trade unions and TNCs) have become much more conscious of the transnationality of their practices and have striven to extend their global influence. As capitalist globalization spread, anti‐globalization researchers and activists focused on imports and exports, and vested some products with great political and culture‐ideology significance. Increasing numbers of consumers now register where what they are buying comes from, and producers now register where what they are producing will go to, and this knowledge may affect their actions. An important example of this process is the rapid growth of ethical and organic marketing between Third World producers and First World consumers. These transnational practices must be seen within the context of an unprecedented increase in the volume of economic transnational practices since the 1950s, as evidenced by the tremendous growth of cross‐border trade. According to the World Bank, global exports rose from US$94 billion in 1965, to $1,365 billion in 1986, $3,500 billion in 1993 and over $5,400 billion in 1999. Foreign investment and other types of capital flows have increased even more rapidly. This means that even some quite poor people in some poor countries now have access to many non‐local consumer goods, and through their use of the mass media are becoming more aware of the status‐conferring advantages that global branded goods and services have over others. […]
The transnational capitalist class is not made up of capitalists in the traditional Marxist sense. Direct ownership or control of the means of production is no longer the exclusive criterion for serving the interests of capital, particularly not the global interests of capital.
The transnational capitalist class (TCC) is transnational in at least five senses. Its members tend to share global as well as local economic interests; they seek to exert economic control in the workplace, political control in domestic and international politics, and culture‐ideology control in everyday life; they tend to have global rather than local perspectives on a variety of issues; they tend to be people from many countries, more and more of whom begin to consider themselves citizens of the world as well as of their places of birth; and they tend to share similar lifestyles, particularly patterns of luxury consumption of goods and services. In my formulation, the transnational capitalist class includes the following four fractions:
This class sees its mission as organizing the conditions under which its interests and the interests of the global system (which usually but do not always coincide) can be furthered within the transnational, inter‐state, national and local contexts. The concept of the transnational capitalist class implies that there is one central transnational capitalist class that makes system‐wide decisions, and that it connects with the TCC in each community, region and country.
Political transnational practices are not primarily conducted within conventional political organizations. Neither the transnational capitalist class nor any other class operates primarily through transnational political parties. However, loose transnational political groupings do exist and they do have some effects on, and are affected by, the political practices of the TCC in most countries. There are no genuine transnational political parties, though there appears to be a growing interest in international associations of parties, which are sometimes mistaken for transnational parties. […]
There are, however, various transnational political organizations through which fractions of the TCC operate locally, for example, the Rotary Club and its offshoots and the network of American, European and Japan‐related Chambers of Commerce that straddles the globe. As Errington and Gewertz show in their study of a Rotary Club in Melanesia as well as my own research on AmCham in Mexico, these organizations work as crucial transmission belts and lines of communication between global capitalism and local business. […]
At a more elevated level are the Trilateral Commission of the great and good from the United States, Europe and Japan whose business is ‘Elite Planning for World Management’; the World Economic Forum which meets at Davos in Switzerland and the annual global conferences organized by Fortune magazine that bring together the corporate and the state fractions of the TCC. Many other similar but less well‐known networks for capitalist globalization exist, for example the Bilderberg Group and Caux Round Table of senior business leaders. There are few major cities in any First or Third World (and now New Second World) country that do not have members of or connections with one or more of these organizations. They vary in strength from the major First World political and business capitals, through important Third World cities like Cairo, Singapore and Mexico City, to nominal presences in some of the poorer countries in Africa, Asia and Latin America. They are backed up by many powerful official bodies, such as foreign trade and economics departments of the major states. Specialized agencies of the World Bank and the IMF, WTO, US Agency for International Development (USAID), development banks, and the UN work with TNCs, local businesses, and NGOs (willing and not so willing) in projects that promote the agenda of capitalist globalization. […]
The relative strength of the transnational capitalist class can be understood in terms of the relative weakness of transnational labour. Labour is represented by some genuinely transnational trade unions…. In addition, there are some industrially based transnational union organizations, for example the International Metalworkers Federation, and the International Union of Food and Allied Workers’ Associations. These have been involved in genuine transnational labour struggles, and have gained some short‐term victories. However, they face substantial difficulties in their struggles against organized capital, locally and transnationally, and they have little influence. […]
While most TNCs in most countries will follow the local rules regarding the unions, host governments, particularly those promoting export processing industries (not always under pressure from foreign investors), have often suspended national labour legislation in order to attract TNCs and/or to keep production going and foreign currency rolling in. With very few exceptions, most globalizing bureaucrats and politicians wanting to take advantage of the fruits of capitalist globalization will be unhelpful towards labour unions, if not downright hostile to them when they dare to challenge the transnational capitalist class. […]
[…] Bagdikian characterized those who control this system [world media] as the lords of the global village. They purvey their product (a relatively undifferentiated mass of news, information, ideas, entertainment and popular culture) to a rapidly expanding public, eventually the whole world. He argued that national boundaries are growing increasingly meaningless as the main actors (five groups at the time he was writing) strive for total control in the production, delivery, and marketing of what we can call the culture‐ideology goods of the capitalist global system. Their goal is to create a buying mood for the benefit of the global troika of media, advertising and consumer goods manufacturers. ‘Nothing in human experience has prepared men, women, and children for the modern television techniques of fixing human attention and creating the uncritical mood required to sell goods, many of which are marginal at best to human needs’. Two symbolic facts: by the age of 16, the average North American youth has been exposed to more than 300,000 television commercials; and the former Soviet Union sold advertising slots on cosmonaut suits and space ships! In order to connect and explain these facts, we need to generate a new framework, namely the culture‐ideology of consumerism.
The transformation of the culture‐ideology of consumerism from a sectional preference of the rich to a globalizing phenomenon can be explained in terms of two central factors, factors that are historically unprecedented. First, capitalism entered a qualitatively new globalizing phase in the 1960s…. [I]n the second half of the twentieth century, for the first time in human history, the dominant economic system, capitalism, was sufficiently productive to provide a basic package of material possessions and services to almost everyone in the First World and to privileged groups elsewhere…. A rapidly globalizing system of mass media was also geared up to tell everyone what was available and, crucially, to persuade people that this culture‐ideology of consumerism was what a happy and satisfying life was all about….
Mass media perform many functions for global capitalism. They speed up the circulation of material goods through advertising, which reduces the time between production and consumption. They begin to inculcate the dominant ideology into the minds of viewers, listeners and readers from an early age, in the words of Esteinou Madrid, ‘creating the political/cultural demand for the survival of capitalism’. The systematic blurring of the lines between information, entertainment, and promotion of products lies at the heart of this practice. This has not in itself created consumerism, for consumer cultures have been in place for centuries. What it has created is a reformulation of consumerism that transforms all the mass media and their contents into opportunities to sell ideas, values, products, in short, a consumerist worldview. […]
Contemporary consumer culture would not be possible without the shopping mall, both symbolically and substantively. As Crawford argued, the merging of the architecture of the mall with the culture of the theme park has become the key symbol and the key spatial reference point for consumer capitalism, not only in North America but increasingly all over the world. What Goss terms the magic of the mall has to be understood on several levels, how the consuming environment is carefully designed and controlled, the seductive nature of the consuming experience, the transformation of nominal public space into actual private terrain. Although there are certainly anomalies of decaying city districts interspersed with gleaming malls bursting with consumer goods in the First World, it is in the poorer parts of the Third World that these anomalies are at their most stark. Third World malls until quite recently catered mainly to the needs and wants of expatriate TNC executives and officials, and local members of the transnational capitalist class. The success of the culture‐ideology of consumerism can be observed all over the world in these malls, where now large numbers of workers and their families flock to buy, usually with credit cards, thus locking themselves into the financial system of capitalist globalization. […]
The theory of the global system can be summarized, graphically, as follows. All global systems rest on economic transnational practices and at the highest level of abstraction these are the building blocks of the system. Concretely, in the capitalist global system they are mainly located in the major transnational corporations. Transnational political practices are the principles of organization of the system. Members of the transnational capitalist class drive the system, and by manipulating the design of the system they can build variations into it. Transnational culture‐ideology practices are the nuts and bolts and the glue that hold the system together. Without them, parts of the system would drift off into space. This is accomplished through the culture‐ideology of consumerism. […]
In order to work properly the dominant institutions in each of the three spheres have to take control of key resources. Under the conditions of capitalist globalization, the transnational corporations strive to control global capital and material resources, the transnational capitalist class strives to control global power, and the transnational agents and institutions of the culture‐ideology of consumerism strive to control the realm of ideas. Effective corporate control of global capital and resources is almost complete. There are few important natural resources that are entirely exempt from the formal or effective control of the TNCs or official agencies with whom they have strategic alliances. The transnational capitalist class and its local affiliates exert their rule through its connections with globalizing bureaucrats and politicians in pro‐capitalist political parties or social democratic parties that choose not to fundamentally challenge the global capitalist project. The local affiliates of the TCC exert authority in non‐capitalist states indirectly to a greater or lesser extent. This is the price levied as a sort of entrance fee into the capitalist global system. In the last resort, it is the corporate control of capital and labour that is the decisive factor for those who do not wish to be excluded from the system.
The struggle for control of ideas in the interests of capitalist consumerism is fierce, the goal is to create the one‐dimensional man within the apparently limitless vistas of consumerism that Marcuse prophesied. Ideas that are antagonistic to the global capitalist project can be reduced to one central counter‐hegemonic idea, the rejection of the culture‐ideology of consumerism itself, and they get little exposure in the mass media, as opposed to alternative media where they are at the core of an exciting cultural diversity for minority groups all over the world. Without consumerism, the rationale for continuous capitalist accumulation dissolves. It is the capacity to commercialize and commodify all ideas and the products in which they adhere, television programmes, advertisements, newsprint, books, tapes, CDs, videos, films, the Internet and so on, that global capitalism strives to appropriate. […]