Dialectic, Cosmos, and Society
Issue Number Three
Introduction
Rudolfo Rincones: A Preliminary Analysis of the 1992 Elections in Mexico: The Case of Chihuahua
Anthony E. Mansueto: The Crisis of Neoliberalism and the Emergence of a Progressive-Institutionalist Bloc
Songs of Struggle
The Foundation for Social Progress
Introduction
The 1992 General Elections in the United States mark a change in the composition of the hegemonic
ruling bloc in the United States. For the past 12 years, the U.S. has been governed by a neoliberal-
conservative alliance led by the large commercial banks and the multinational corporations which
celebrated the virtues of the spontaneous order of the marketplace and of traditional forms of social
organization, especially the patriarchal family. This alliance mounted a frontal assault on the
socialist countries and on the national liberation movements which precipitated the disintegration of
the Soviet Union (which was already in crisis) and put the national liberation movements, which had
experienced a decade of victories, on the defensive. The alliance also undertook systematic
reduction in levels of taxation, particular taxation on on the privileged classes, and in levels of state
expenditure, while deregulating vast spheres of economic and social activity. The result has been a
profound crisis, as the system finds it increasingly difficult o protect the integrity of the ecosystem
and the social fabric, or to centralize the resources necessary for investment in infrastructure,
education, research, and development. As the economic crisis has deepened, the hegemony of the
neoliberal-conservative bloc has increasingly been undermined, creating an opening for progressive
forces.
The new ruling bloc is led by a coalition of investment bankers and capitalists based in nonmilitary,
high technology sectors. Elements in the clergy and the social development bureaucracy, anxious to
halt the erosion of the social fabric, have provided an important strategic reserve. This new
"progressive-institutionalist" bloc promises to take measures to halt the degradation of the
environment, repair the social fabric (through measures like the family leave bill) and to use the
mechanisms of taxation, state expenditure, and state regulation to catalyze investment in
infrastructure, education, research and development.
It is vitally important that progressive forces understand in a balanced and nuanced manner the
nature and implications of this change. On the one hand, the working classes remain largely
unorganized, and have no real representation in this new bloc. Organizations such as the Industrial
Areas Foundation, controlled by the clergy, will serve to bloc the formation of independent working
class organization. At the same time, Clinton's victory in the election will lead to a marked change
in the tone of public discourse and in the main thrust of public policy. The rhetoric of individualism
and self-reliance will give way to a new sense of personal and social responsibility. Blind faith in
the workings of the marketplace will give way to state led investment in the development of human
social capacities.
This issue of Dialectic, Cosmos, and Society explores the significance the political realignment on
the North American continent. Rudolfo Rincones analyzes the somewhat paradoxical phenomenon
of neoliberal consolidation in Mexico, at the very moment when neoliberalism is entering a period
of crisis in the U.S. My own article examines in some detail the current realignment in the U.S.
In this issue we include for the first time some poetic material --in this case three songs from the
popular movements. We hope to include more material of this sort in the future.
We call your attention to the brief description of the Foundation for Social Progress and an
invitation to membership, which appears at the end of this issue.
A Preliminary Analysis of the 1992 Elections in Mexico:
The Case of Chihuahua
Rudolfo Rincones
The first years of the 1990s have witnessed profound changes in the economic, institutional, and
political life of Mexico. In the international economic arena, Mexico is in the process of negotiating
the North American Free Trade Agreement, which would created a unified market embracing
Canada, the United States and Mexico. On the national level, fiscal and monetary policy is being
reorganized. Institutional efficiency and efficacy are the order of the data, as such diverse sectors
as energy production, health, and education, are being pushed to help the country compete
economically with the United States, Canada, and the most advanced economies in Europe and Asia.
This new emphasis on international competitiveness as been accompanied by a shift in international
alignment. Mexico has softened its commitment to the nonaligned movement generally and to Latin
American liberation movements in particular. Some see these changes as the first stages in the
development of a new democracy.
There are signs that the political monopoly of the Partido Revolucionario Institucional (PRI) is
beginning to loosen. The opposition Partido Accion Nacional (PAN), a party of Christian
Democratic origins which currently advocates neoliberal policies, won the gubinatorial elections in
Baja California del Norte in 1989 --the first time an opposition party has won an election at that
level since 1929, when the PRI was created. This year PAN won the gubinatorial elections in the
state of Chihuahua, as well as most of the mayoral races in the larger cities of that state.
In order to understand these developments accurately, however, it is necessary to situate them in the
context of the complex transformation of Mexican society, and its integration into a changing
international economic and political environment.
At the most fundamental level, the reorganization of Mexican society is rooted in an enormous
international debt, which has had devastating consequences for the national economy, and growing
popular unrest due to the unwillingness of the PRI to allow other political parties to participate
freely in the political system, and to the centralized political system generally. At the center of this
process of reorganization has been growing subservience to the recommendations made by the
International Monetary Fund (IMF). The IMF has pressed Mexico to reduce the national debt, to
privatize corporations managed by the government, to negotiate entry into the General Agreement on
Trade and Tariffs (GATT), and to create a politically pluralistic society. The plan adopted by the
government in response to these IMF recommendations, has brought about a deterioration in the
standards of living of many middle class Mexicans, as well as the broad layers of the working class.
In order to carry out this program, several constitutional amendments have been enacted. For
example, Salinas de Gotari is the only president since the revolution of 1910 that has not conducted
an agrarian reform. On the contrary, he has actually amended the constitution to permit the
communal unit of production (ejido) to establish units of production with private businesses. This
will have grave consequences for the Mexican economy, raising the specter of the privatization of
land ownership and the displacement of the peasantry. Maquiladoras along the border with the U.S.
have absorbed thousands of Mexicans displaced by privatization of agriculture and industry. Cities
such as Juarez, as well as others further from the border, have become magnets for people from
throughout Mexico. The impact of this process on social relations, traditions, family, culture, and
the development and utilization of human capacities remains unclear.
Control of education --including fiscal and planning responsibilities-- has been transferred from the
federal government to the states. The government has all but broken an historically powerful
teachers union. Textbooks generally, and History texts in general are being revised to reflect the
new national priorities.
Likewise, the church and the clergy have been given a new role in Mexican society. Clergy are
now allowed to vote, something which they had not been permitted to do since the end of the last
century. By establishing relations with the church, the government hopes to dissociate local and
regional clergy from the political orientation of the people, while centralizing power in the
ecclesiastical hierarchy and using it to control dissent (Lau 1990).
In the political arena, the PRI has permitted an opening to the right, "permitting" electoral victories
by the PAN, which advocates free market polices and privatization, and which has historic links to
both international capital and to the church. The prospect of sharing power with the PAN does not,
therefore, fundamentally threaten the neoliberal policies of the PRI. The leftist Partido
Revolucionario Democratico (PRD), on the other hand, despite broad popular support in central and
southern Mexico, has been denied entry into the political arena, and is unlikely to be granted entry
until the economic policies support by the PRI and PAN are well established.
The 1992 elections can, therefore, be analyzed from several different perspectives. At the political
level, the importance of these elections resides in the fact that for the first time in Mexican history
the hegemony of the PRI has been successfully challenged. Because of this it is now said in Mexico
that democracy has finally arrived. But is this really true? There is no doubt that the electoral
victories of the opposition parties have galvanized popular belief in democracy and that now more
than ever Mexicans believe in the power of the vote and in partisan politics. The electoral victory
in Chihuahua will invigorate the PAN and it will gain more political latitude. Ultimately this may
lead to the emergence in Mexico of a bipartisan political system. This system will, however, limit
political discourse and exclude opinions which dissent from the prevailing neoliberal consensus.
The Mexican Congress will be permeated by a bipartisan politics, and will follow the desires of the
executive branch. Constructive debate over national, economic, and social issues will be strictly
limited.
It is also interesting to note the emergence of political parties such as the Partido del Trabajo (PT)
which won the mayoral race in Durango. Most of these parties use rhetoric which is nationalistic
and populist in tone. These parties appeal to the masses dislocated by the policies of the PRI, but
divide the political base of the more powerful PRD.
PRI and PAN have similar economic platforms: they promote free market policies, reduction of
government spending, and foster the penetration of international capital. In a country where a large
portion of the population is under 20 years of age, with low educational levels and limited skills, it
is inevitable that Mexico generally, and the border states in particular, will become havens for low
wage, low skill industries.
We can expect that other social institutions, such as education and religion, will be used more as a
means of social control than as means of promoting the development of humanity as a whole.
In short, Mexican "democracy" will become a game of political "musical chairs" between PRI and
PAN, with other parties playing a minor role at the national and regional levels. In Chihuahua there
will be a rotation of elected positions between PRI and PAN. Eventually a bipartisan political
system will be consolidated. The political debate will not be enriched significantly and dissenting
opinions will become a hollow voice. Economic, social, and cultural policies will not change.
Mexicans, to be sure, are facing a new era, filled with political changes. These changes, however,
will be geared toward the creation of bipartisan political system which will only compound Mexico's
already serious economic and social problems.
REFERENCES
Lau, Ruben
1990 "Crisis y Distencion Electoral 1980-1990," Noesis, Ene/Jun 1990, pp. 53-70
The Crisis of Neoliberalism
and the
Emergence of a Progressive-Institutionalist Bloc
Anthony Mansueto
In the last issue of Dialectic, Cosmos, and Society, we published an article on "Synergism" which
outlines our current understanding of the process of human historical development. The article
argued that we stand at the threshold of a new era, when ecologically sound technologies, new
methods of institutional organizing, new sciences of organization, and a new spirituality founded on
a rational grasp of the self-organizing character of the cosmos will flourish, making possible an
unprecedented development of human social capacities. Neither market nor centralized
redistributional systems are adequate to the task of organizing the complex new forms of social
activity which are emerging. We must develop new structures which guarantee the allocation of
resources in such a manner as to best promote the qualitative complexity of the ecosystem and the
all sided development of human social capacities. We characterized such structures as synergistic.
That article contained a brief analysis of the current situation and of our strategic perspective. The
present article takes up where that article left off, and attempts to define with greater precision the
nature of the current crisis, and the current alignment of social forces. The article focuses on the
situation in the United States, and addresses international developments primarily in so far as they
affect our work here. The article also focuses in particular on the implications of the recent U.S.
general election, which we regard as an important political event which signals significant changes
in the political climate. An upcoming article will set forth our strategic plan in some detail.
I. The Emergence of Synergistic Forms of Social Organization
We need to begin by explaining in greater detail what we mean by the emergence of synergistic
forms of social organization. Industrial organization is based fundamentally on breaking down the
pre-existing organization of matter in order to release energy and then use that energy to reorganize
matter in new, presumably more complex forms. This is true at all levels. Industrial production
burns fossil fuels (or smashes atomic nuclei) in order to generate energy, which is then used to
break raw materials down into their constituent elements, transforming ores into metal, wood into
pulp, etc., and then to reorganize these elements as machines, paper, etc. Similarly, industrial
production requires that communitarian forms such as the family and the village community be
broken down, and that workers be reorganized under the discipline of the factory system. The
science of the industrial era is irreducibly analytic, breaking the object of knowledge down into its
component parts (particles, elements, competing organisms, etc.). The marketplace serves, among
other things as a social solvent, breaking down communitarian social forms so that industrial
organizations can then reassemble them in new ways.
While industry has vastly increased human productive capacities, and human organizing capacity
generally, it has a tendency to simply displace organization i.e. from carbon based organisms to
silicon based machines, from village communities to factories, rather than raising the overall level of
organization and complexity. Thus the deepening ecological crisis of industrial societies. Similarly,
industrial production is largely indifferent to the social capacities of the workers it mobilizes,
something which frequently leads to a tremendous waste of human talent.
The new synergistic forms of organization are very different. Synergistic technology is based on an
understanding of production as a conscious participation in the self-organizing activity of the
cosmos. From the ecological side this means that it must not be based simply on the exploitation of
natural resources, but rather on the struggle to actually increase the qualitative complexity of the
ecosystem. This means using sources of energy and raw materials which are renewable, the
"capture" of which does not reduce the energy or raw material available for other uses. Production
must also be clean enough that valuable species of plants and animals, which make up an
irreplaceable part of the genetic endowment of this planet, are not lost. Synergistic technology thus
takes as its starting point the energy producing, self-organizing activities of the natural world, and
then integrates and channels these process to create new and more complex products. This is true of
both new energy sources (solar, biomass, wind) and of some of the biotechnological methods of
production.
Similarly, synergistic production must not simply exploit human labor; it must tap fully into the
creative potential of the working classes, and actually regard the task of increasing that potential as
the principal force for economic growth. From an industrial standpoint it makes little difference if
one worker on an assembly line is a talented organizer, another a great artist, and a third a closet
theoretical physicist, if employing these workers on the assembly line, rather than as organizers,
artists and physicists, maximizes the profits of the owners (in an industrial capitalist society) or the
total value produced (in an industrial socialist society). From a synergistic standpoint, on the other
hand, such a "use" of human resources is a terrible waste. In its fully developed form, all routine
tasks will have been automated, and human labor will consist in designing and organizing the
production process --though we may well find that an element of manual labor actually increases
our ability to understand, and thus organize and direct, productive activity. Synergistic modes of
production will take as their starting point traditional social formations such as the family, the
village community, the workshop, and the workers collective, and then reorganize these structures
in such a way as to increase their creativity and productivity, and integrate them into larger social
networks, rather than dissolving them and then attempting to subject the workers to an external
factory discipline.
Synergistic production cannot be organized adequately by either the marketplace or by a centralized
state planning apparatus. The marketplace, in so far as it allocates resources in such a way as to
maximize profit, has no access to information regarding the qualitative complexity of structures, and
certainly has no mechanism at its disposal for encouraging the development of such structures.
Centralized state planning mechanisms, when coupled with de facto state ownership of enterprises,
have proven rather more effective at centralizing surplus necessary for promoting such development
--such as health care, housing, employment, education, scientific research and technological
development-- and (where there is the will) for curtailing ecologically destructive activities. Such
planning mechanisms have no realistic prospect, however, of collecting and organizing information
regarding the interests and capacities of billions of virtually unique individuals, much less of
organizing the activities of those individuals in a way which taps directly into, rather than
suppressing those interests and abilities.
The process of developing synergistic social structures is still in its earliest stages. We must, first
of all, develop a more conceptually rigorous understanding of "organization," so that we know
precisely what it is that we are attempting to promote. To put the matter differently, we need to
know with far greater precision than we do now just what we mean by the "qualitative complexity
of the ecosystem," and the "development of human social capacities" and be able to tell, in any
given situation whether these qualities are more or less developed. Second, we must have a way of
knowing the interests and abilities of each individual in the society, and of organizing their activity
in a way that taps into that interest and ability to promote the all sided development of humanity.
This means not simply accessing and processing information, but building complex multidimensional
relationships which can actually change peoples motivations. Each individual, whatever his or her
particular interests, abilities, etc., must locate his or her own highest interest in promoting the all
sided development of humanity and of the cosmos as a whole.
To what extent are the conditions outlined above, which we have argued are necessary if we are to
develop fully humanity's capacity to participate in the self-organizing activity of the cosmos,
beginning to develop? There can be no doubt that elements of synergistic technology are beginning
to emerge. Solar, biomass, and wind energy technologies are extremely promising, and meet fully
the criteria we outlined above regarding renewability. "Hot" and "cold" fusion are somewhat more
controversial, and have significant limitations, but deserve our continuing attention. Biotechnology,
together with studies of artificial life and artificial intelligence are teaching humanity how to harness
the self-organizing properties of matter itself. The development of machine intelligence generally,
and of robotics in particular, promises real progress towards the automation of less creative aspects
of the production process. The percentage of workers involved in direct reorganization of physical,
chemical, and biological matter continues to decline in the advanced industrial countries, while more
and more are employed in organizing the production process itself, or in collecting and processing
information. Progressive corporations are increasingly involving workers in analyzing the
challenges facing the enterprise, and in developing and implementing solutions. New sciences of
organization, such as anthropic cosmology, the theory of nonlinear dynamic systems, ecology and
"deep evolution," algorithmic information theory, cybernetics, general systems theory, and
synergetics are forging the intellectual tools that we need in order to organize a complex synergistic
economy. And millions, across a broad religious and ideological spectrum, from traditional
religious institutions to the outer limits of the New Age movement, are increasingly speaking the
language of interdependence, solidarity, and the Common Good.
There are, however, definite limits to these current developments. Those who speak as if we were
on the verge of a new postindustrial era are, I think, sadly mistaken. On the one hand, those
technologies which we have available --such as solar and wind energy, institutional organizing, etc.,
are very far from being fully implemented. On the other hand, we have a very long way to go
before the technological, economic, political, and cultural level of our society can be regarded as
authentically postindustrial.
At issue here is the need to develop fundamentally new ways of producing, acting, thinking, and
feeling. Development of solar and wind energy and the enforcement of stricter environmental
standards is not sufficient for synergism, if we continue to organize production in such a way as to
simply maximize value or profit. It is necessary to develop a qualitative analysis of the complexity
of the ecosystem, and plan production in a way that reflects our understanding of labor not simply
as a means of satisfying human needs and desires, but as a conscious participation in the self-
organizing activity of the cosmos.
Replacing manual laborers with "knowledge workers" is hardly sufficient for synergism, if those
"knowledge workers" continue to be exploited in much the same way as the assembly line workers
of old --if their time, and their skill are simply used to produce value. For synergism it is necessary
that the economic system be able to analyze, and tap into the interests and creative potential of the
working classes --and that the full development of that potential be regarded as the principal motor
of growth. It is not enough for synergism that increased funds be invested in education and
training, if that training is purely technical in character and does nothing to develop workers as
engineers, organizers, artists, scientists, philosophers, and spiritual leaders.
Similarly, involving workers in analyzing the relationships which affect the enterprise, and in
developing solutions, is not sufficient for synergism if the mission of the organization continues to
be understood simply as maximizing profit or production of use values. For synergism it is
necessary that the tasks of particular organizations be derived from a developing analysis of the
ways in which that organization can best serve the ongoing development of humanity, and of the
cosmos as a whole.
Even the most advanced developments in complex systems theory suffer from a tendency to
understand organization rather narrowly, in terms of the capacity to access and process information,
rather than in terms of complex, multidimensional relationships which bear fruit in creativity,
power, knowledge, and love. As a result, there is a growing group of scientists who believe that
the next steps in social development will be taken not by human beings but rather by silicon and
metal based intelligent machines (Barrow and Tipler 1986, Tipler 1989).
Similarly, in the realm of spirituality, using the language of interdependence, solidarity, and the
common good, is not sufficient for synergism unless we both understand the real social conditions
for the realization of those values, and are interested enough in those values that we are willing to
struggle for the comprehensive reorganization of the social order.
It is thus necessary to identify the structural obstacles to the full development of synergistic,
technology, economics, politics, and culture. We will examine the economic, political, and
ideological dimensions of the problem, and consider both long range structural factors and the
current political conjuncture.
II. The Current Crisis
The current crisis is rooted ultimately in the internal contradictions of the market system itself,
coupled with the collapse of the bureaucratic redistributional structures which mitigated those
contradictions during earlier periods of capitalist development, and provided an important strategic
reserve for progressive forces in the U.S. and around the world. In order to understand this crisis,
it is helpful to examine the operation of the marketplace in the light of current developments in
systems theory.
Neoliberal economists have pointed out, quite correctly, that the marketplace functions as a kind of
information processing system (Hayek 1988), accessing, processing, and transmitting an incredible
quantity of data regarding the relative demand for, and scarcity of, various goods and services.
Drawing on contemporary theories which equate information which negative entropy (Shannon and
Weaver 1949), they argue that maximizing information processing maximizes organization. No
centralized planning agency or redistributional structure can grasp the complexity of a highly
interdependent, rapidly developing social system, and any attempt on the part of such agencies to
plan the society will inevitably result in a loss of complexity and will hold back growth and
development. Thus the superiority of the marketplace as a regulating mechanism for human
societies (Hayek 1973: 49; 1988: 15, 77).
This analysis is seriously flawed. There are, first of all, real limits to the types of information which
the marketplace can access, process, and transmit, and to the type of information processing which
it can carry out. The marketplace has no access to information regarding the impact of various
activities on qualitative complexity of the ecosystem or on the development of human social
capacities. On the contrary, the marketplace accesses only information regarding the effective
demand for various goods and services, the relative scarcity of those goods and services, and,
indirectly, the quantity of socially necessary labor time contained in those goods and services. The
system encodes this information in the form of a price structure, which individuals may then use to
determine the relative profitability of various activities open to them, given the resources (land,
labor, capital) which they control.
Furthermore, in so far as the marketplace is merely an information processing system, it does
nothing to develop complex multidimensional relationships between human beings which are the
precondition for creativity, power, knowledge, and love. It does nothing either to tap into the most
advanced aspirations of the people, or to challenge them to develop more complex interests. On the
contrary, it tends to break down all relationships which do not permit individuals to realize their
short term consumer interests, and makes consumption the final goal of all human activity. It
should thus come as no surprise that the marketplace tends to systematically degrade the ecosystem
and to erode the social fabric. As market relations penetrate every sphere of social life, all activity
is transformed into simply a means of realizing individual consumer interests. The complex web of
interdependence between humanity and the natural world, and the intricate networks of nonmarket
relationships which make up families, village communities, and urban neighborhoods begin to
dissolve, undermining the ecological conditions for life itself, and interrupting the delicate process
of socialization which prepares human beings to be productive workers, powerful participants in the
political process, able to understand the world around them and to devote themselves to its ongoing
development (Durkheim 1897/1951, Marx 1844/1978, Lasch 1979, Bellah 1985, 1991).
The market system also creates definite structural obstacles to the development of human social
capacities. This is true, first of all, because as investment in new technology or in skilled labor,
increases, the rate of profit will, other things being equal, tend to decline. Long term research and
development efforts, massive infrastructure projects, the development of an educational and health
care system, etc., are relatively less profitable than low wage labor intensive activities (Marx
1867/1976: 772ff, Mandel 1968: 166ff).
Historically, capitalist societies have coped with this contradiction in two ways. On the one hand,
to the extent that the market has been permitted to operate unimpeded, capital has tended to flow
away from capital intensive high wage sectors to labor intensive, low wage activities. This is the
basis for the redeployment of capital from the advanced industrial to the developing countries, and
from industry generally to the services sector (Lenin 1916/1971: 169ff, Mandel 1968: 448, 535).
At the same time, in order to create the conditions for capitalist accumulation, the state has
undertaken to finance critical research and development and infrastructure projects through
nonmarket mechanisms. Thus the leading role of the state in the development of roads and
railroads, of air transportation, etc., and in the development of a system of universal public
education. This is the pattern which prevailed during the early stages of capitalist development --in
the U.S. from roughly 1865-1918.
This often led to sharp contradictions between the advanced industrial sector of the bourgeoisie,
which opposed imperialism and which sought increased investment in infrastructure, education,
research and development, and reactionary, imperialistic, planter, rentier, and financial elements.
Daniel Walker Howe writes that John Quincy Adams, for example,
believed in a messianic age, as prophesied by the Second Isaiah .. The advance of
civilization, technology and knowledge were taking us near to this long awaited day:
"Progressive improvement in the condition of man is apparently the purpose of a
superintending Providence." Such had been the burden of his famous First Message to
Congress in 1825. The system of internal improvements there outlined, he remained
convinced, constituted a "sacred duty," imposed by God to elevate America in the scale of
civilization. The political policies of his rivals "led us back to the savage sate" and away
from the millennial age. The contemplation of the divinely ordained glorious end of history
promoted Adams to his highest flights of eloquence. When secretary of state he had been
requested by Congress to prepare a report on weights and measures. The impressive
document he drew up presents a thorough justification for the adoption of the metric system
in terms of scientific rationality and international cooperation. But his peroration declares
the metric system desirable in the last analysis because it implements the "trembling hope of
the Christian" for the unity of mankind, the binding in chains of Satan and the thousand
years of peace on earth. No more remarkable synthesis of Christianity with the
Enlightenment can well be imagined (Howe 1979: 58).
This notion that industrialization and rationalization would somehow bind the planet together in a
higher unity, was coupled with a disdain for what he perceived as the backward, imperialistic thrust
of westward expansion.
Towards the end of his life, Adams began to doubt that the Union really was serving the
ends of political, economic, and moral "improvement." If the Union continued on the course
set by the annexation of Texas, he feared it would become a "conquering and warlike
nation." Then "aggrandizement will be its passion and its policy. A military government, a
large army, a costly navy, distant colonies and associate islands in every sea will follow in
rapid succession ..." (Howe 1979: 68).
He "deplored the "perfidious dismemberment of Mexico (Howe 1979: 68)," and died on floor of
House opposing commendations for the generals who had conquered Mexico.
This is the type of sentiment that drove the Whig party, and progressive elements of the Republican
party, until about 1876, as they forged an alliance which brought together the industrial bourgeoisie,
farmers and workers to build a thriving industrial economy. By 1876, however, the growing
strength of rentier elements had crushed this alliance, and while certain progressive initiatives
continued (development of the railroad system), capital withdrew increasingly into low wage, low
skill, low technology activities.
Redeployment of capital to labor intensive, low wage activities precipitates a secondary economic
contradiction: the tendency towards overproduction or underconsumption. In a market system all
production must find an outlet either in final consumer demand, or else in demand for capital goods
used to produce goods for final consumption. But if capital flows by preference into low wage
activities, then real wages, and therefore effective demand, will remain low and eventually become
an obstacle to economic growth. Historically this became an critical problem beginning towards the
end of the nineteenth and the beginning of the twentieth centuries, when corporations began to
develop durable consumer goods such as automobiles, various home appliances, and eventually
radios and televisions, which were too expensive for the average worker. The result was the period
of protracted stagnation which lasted from 1914-1945, and more specifically, the Great Depression
which began in 1929 (Marx 1863/1978: 465, Davis 1986).
There were, broadly speaking, three responses to this crisis. Countries on the periphery of the
world capitalist system, which provided low wage outlets for capital from the more advanced
capitalist centers, found the road to development blocked entirely. Developmentalist elites joined
with impoverished workers and peasants to lead a series of revolutions in Mexico, Russia, China,
and elsewhere in Asia, Africa, and Latin America which initiated state led development strategies.
Dispossession of foreign capitalists and landed elites restricted unproductive consumption, so that
surplus extracted from the peasantry could be invested in industrialization, development of a
bureaucratic administrative apparatus, education, research, and development. In most cases the
burden of defending these revolutions required a large part of the surplus to be invested as well in
the creation of a large military industrial complex and a national security apparatus.
In countries in the middle ranks of industrial development --German, Japan, Italy-- which lacked a
colonial empire, and where revolutionary movements either failed or never developed, fascist
movements came to power which mobilized nationalistic and religious sentiments in order to
leverage support for development of a massive military apparatus. This military apparatus at once
promised to win for these countries the colonial empires which they lacked, and at the same time,
provided a focus for state financed investment in research and development activities which the
marketplace itself would not support --e.g. the development of rocket technology, nuclear energy,
etc. (Mandel 1968: 536).
In the advanced capitalist countries (Northwestern Europe, North America) these two dynamics
were combined, but in a way which ultimately served the interests of an emerging bloc of capitalists
centered in the large commercial banks and the consumer durables sector. On the one hand
capitalist states developed large national security bureaucracies and used state expenditures to
finance the development of technologically advanced defense systems which were directed first
against fascism, and later against the socialist countries and the national liberation movements. State
expenditures, in effect, were used to defend the marketplace against the threat of movements
advocating statist development strategies --and simultaneously to finance research and development
in the electronics, telecommunications, and aerospace industries which the marketplace itself could
not support.
At the same time the state created a legal framework for collective bargaining which permitted
workers organizations to drive up real wages and thus effective demand (but not to mount a real
contest for power), and set in place a system of transfer payments (Unemployment Insurance,
Workmens Compensation, Social Security, and eventually General Assistance and Aid to Families
with Dependent Children) designed to mitigate the effects of cyclical crises on real wages and
effective demand. A share the surplus produced by the working class was, in effect, returned to
them (Mandel 1968: 536; Davis 1986).
This dynamic could have developed in either of two directions. On the one hand, it was possible
for this surplus to be invested in infrastructure, education, research, and development, setting in
motion a process of human capital formation and of working class development. Or it could be
used to create an expanding market for consumer durables (and in particular for suburban houses
and automobiles) which did little to advance human creative capacities. In Europe, which had a
powerful organized bureaucracy, and a strong social democratic workers movement, the first of
these tendencies was rather more pronounced, but in the United States, where the bureaucracy and
workers movement was weak, it was the second, consumerist impulse which dominated. This
effectively brought the workers movement under the hegemony of the consumer-industrial complex
and the liberal democratic bloc, centered in a reorganized and revitalized Democratic Party, which
was its political expression (Davis 1986).
The resulting "boom," which lasted from 1945 to 1968, had a devastating effect on the ecology and
social fabric of the planet, and only partially removed the structural obstacles to social progress.
Resources which might have been invested in research and development, on ecologically sound
infrastructure systems, and on education was squandered on a war of attrition against socialism and
on ecologically and economically wasteful consumption in which a globally very small fraction of
the working class shared. Most of the real growth and development which took place during this
period was the result either of the persistence of older dynamics (state investment in civilian
research and development, infrastructure, and education) or of spin offs from technology developed
by the military industrial complex. The working class became increasingly mired in the hegemonic
consumerism, and abandoned its historic vocation to lead humanity's struggle towards self-
development, while the technologically most advanced sectors of the bourgeoisie (electronics,
telecommunications, aerospace) and much of the intelligentsia was absorbed into the anticommunist
military industrial complex and the national security state. Those intellectuals who were not tied to
the military industrial complex, meanwhile, faced rapid proletarianization.
John Kennedy's New Frontier, and his brother's Newer World programs were fundamentally
attempts to reform the hegemonic liberal democratic bloc from within. At the international level,
their program centered on reigning in the military industrial complex and setting in motion a process
of detente with the Soviet Union, and supporting reformist development strategies in the Third
World, with a view to creating an expanding market for capital goods produced in the U.S. On the
domestic front, they looked attempted to shift the thrust of domestic social policy from meeting
human needs to catalyzing human development, with growing investment in scientific space
exploration serving as both a symbolic focus and substantive leading factor. Domestic volunteer
programs and expanding state expenditures promised to rescue the nontechnical intelligentsia from
proletarianization and enlist them in a campaign to comprehensively develop human social
capacities. Their attack on the hegemonic consumerism was summed up in John Kennedy's
inaugural call for Americans to ask not what their country could do for them --but rather what they
could do for their country.
This effort at reform was cut short by the bullets of assassins who may well have been in the
employ of threatened elements of the U.S. ruling class. The result was economic crisis and the
rapid disintegration of the hegemonic liberal democratic bloc. Continued U.S. support for
reactionary landed elites and dependent bourgeois elements in the Third World, symbolized by
escalation of the war in Vietnam, blocked the process of agrarian reform and industrialization which
would have created the expanding Latin American, Asian, and African market which U.S. capital
goods industries required. The market for consumer durables became saturated, and European and
Japanese products began to compete with those produced in the U.S. The less than visionary
programs of the Great Society did little more than redistribute income within the working class,
failing to increase the total surplus available for investment in either new technologies, or human
development. The rate of growth of productivity declined, and with it the rate of profit.
Redeployment of capital to low technology, low wage, activities in the Third World only deepened
the crisis (Davis 1986).
Income transfers within the working class, meanwhile, created contradictions between lower strata
workers, drawn largely from oppressed nationalities, and the newly suburbanized workers in the
consumer-and military-industrial complexes whose unions had won them a remarkably high standard
of living. Movements of resistance to proletarianization among younger members of the
nontechnical intelligentsia, meanwhile led to cultural contradictions with the rest of the working
class (Davis 1986).
The result was a period of economic stagnation which began around 1968 and which has persisted
up to the present period, the speculative boom of the 1980s notwithstanding. The first attempt to
address this crisis was rather contradictory in character. On the one hand, the Nixon administration
led the military industrial complex in what must be regarded as a temporary, tactical retreat,
coupled with a second effort at detente with the Soviet Union --this time balanced with new strategic
alliance with China to restrict Soviet influence in the Third World, and thus protect the interests of
U.S. multinationals with direct investments overseas. Meanwhile, Nixon moved to protect the
interests of industries increasingly under the pressure of foreign competition, instituting wage and
price controls, going off the gold standard, and effectively devaluing the U.S. dollar. Most of the
income transfer programs of the Great Society were left intact, but new initiatives, designed to
develop human social capacities rather than merely buy off poor communities, were blocked. A
modest but unsuccessful effort was made to rationalize income transfer programs with proposals for
a "negative income tax." These proposals were especially aimed at elements in the social
development bureaucracy, which capital increasingly perceived as a drain in its resources and a
strategic reserve for the left. The rising tide of oppressed nationality movements and the emerging
new left were crushed in a new wave of domestic repression (Davis 1986).
Nixon was forced from office after overstepping himself in the Watergate conspiracy. A new
coalition centered in the Trilateral Commission, led by the large commercial banks, with elements of
high technology export oriented capital as junior partners, came to power under Ford and Carter. In
order to understand the character of this bloc it is necessary to make a distinction between
transnational and multinational capital. By transnational capital we mean corporations the ownership
of which is increasingly international in character. Transnational corporations are above all located
in the sphere of finance (investment banking) and in certain high technology sectors. By
multinational corporations we mean U.S. corporations with direct investments in (mostly low
technology, low wage activities) abroad.
Trilateralism reflected the interests of the transnational as opposed to the multinational sector of the
ruling class. It was first and foremost an attempt to rationalize production on an international scale,
permitting redeployment of low and intermediate technology activities to Europe, Asia, Latin
America, and Africa, while catalyzing the development of a high technology export oriented
economy in the U.S. The Trilateralist strategy centered on increasing loans to countries in the
Third World, to finance development of low and intermediate technology industries. This would
simultaneously initiate a downward pressure on wages in low and intermediate technology sectors in
the U.S., "rationalizing" production, while creating an expanding market for high technology capital
goods produced in the U.S. The Trilateralist strategy assumed that the discipline of a growing debt
burden would bring the national liberation movements which were coming to power throughout the
Third World more or less to heel, while rapid industrialization undercut the predominantly rural
social basis of these movements and laid the ground work for capitalist modernization --the strength
of populist, socialist, and communist ideologies notwithstanding. At the same time, Trilateralists
mounted a diplomatic and ideological offensive against socialism, slowing the pace of detente,
responding sharply to the Soviet invasion of Afghanistan, and attacking alleged violations of "human
rights." For some within the Trilateralist coalition (e.g. Brezhinski) this was to be the beginning of a
new offensive against the Soviet bloc, for others (Vance, and probably Carter himself), it
represented an effort to set in motion internal reforms within the Soviet bloc which might lay the
groundwork for a new period of peaceful coexistence and collaboration.
The pressure toward economic rationalization in the U.S. was intensified by program of fiscal
austerity which tended to reduce transfer payments and weaken the bargaining position of workers in
the U.S. Reduction in spending for entitlement programs was to be balanced by new investments in
infrastructure, education, research, and development, particularly development of alternative energy
sources and community development programs which empowered working class communities.
Carter's first government included, at the subcabinet level, a new generation of community
organizers such as Gail Cincotta and Gino Barone who saw their role less as advocates for the
consumer interests of the working class than as conservers of the social fabric and leaders in the
struggle to develop human social capacities.
Up until 1978 the more progressive elements in the Trilateralist coalition predominated, and
rationalizing market pressure was accompanied by new initiatives, especially in the field of energy
and community development. But ultimately the Trilateralist coalition was too weak to resist
growing pressures from the right. On the one hand the forward march of victorious national
liberation movements put multinationals with investments in the Third World in a panic. These
were the years of victory for Vietnam, Laos, and Cambodia, Guinea Bissau, Angola, and
Mozambique, Ethiopia, Iran, and Grenada, and finally Nicaragua. The Soviet Union increased its
aid to national liberation movements, sending troops to Afghanistan in 1979. And even the globalist
elements within the Trilateralist camp found it increasingly more difficult to resist the temptation of
imperialist superprofits. Growing debt burdens soon began to undermine capital formation in the
Third World in any case, making rising demand for U.S. capital goods seem increasingly unlikely.
Powerful reactionary interests in the U.S. meanwhile, were profoundly threatened by the policies of
the Carter administration. The petroleum industry feared the impact of a successful alternative
energy strategy on its monopoly superprofits. Rentier elements were hurt by high levels of inflation
which undermined the return on their investments. Intermediate technology sectors joined the
clothing and textile industries in demanding protectionist measures to dampen the effects of foreign
competition.
Antitax sentiment among the working class, meanwhile, was growing. Trilateralist elements used
this to garner support for reductions in transfer payments and entitlement programs. This was a
serious error, as "fiscal austerity" measures soon extended beyond reduction in spending for
entitlement to attacks on spending for infrastructure, education, and nonmilitary research and
development. The new community organizations which were subaltern partners in the Trilateralist
alliance were not strong enough to stem this growing antitax sentiment among the workers, much
less to affect the administration's policies (Davis 1986).
Towards the end of the Trilateralist period a new hegemonic bloc took shape within the Republican
Party, composed of:
a) the large commercial banks and the multinational corporations, increasingly concerned
about the rising tide of the national liberation movements,
b) the military industrial complex and the national security bureaucracy, and
c) broad strata of small investors, speculators, entrepreneurs, etc. who had little interest in
investment in infrastructure, education, research, and development.
The new bloc was united first and foremost around a commitment to global free trade. The
dominant sectors within the bloc --the large commercial banks and the multinational corporations,
have been more or less committed to a neoliberal analysis of the global economy, according to
which taxation, state expenditure, and state regulation all constitute obstacles to growth, through
clearly the military industrial complex and the national security bureaucracy can only embrace this
sort of analysis in a very conditional way. This bloc was able to secure ideological and
programmatic hegemony over broad sectors of the working class and traditional petty bourgeoisie
along two distinct lines. As market relations penetrate every sphere of social life, all activity is
transformed into merely a means of realizing individual consumer interest. This undermines interest
in the public sphere and in promoting the development of human social capacities generally. Thus
the rise of antitax movements throughout the 1970s.
At the same time, life in an advanced industrial society is characterized by an extraordinarily high
level of interdependence. Mediation of this interdependence through market relations undermines
humanity's grasp of its own underlying sociality, while at the same time subjecting individuals to
powerful forces beyond their comprehension and control. Human interdependence receives alienated
expression in ideologies in which the self-organizing activity of the cosmos appears as an alien
power, beyond human knowledge or control. This is most apparent in evangelical Protestantism,
which has historically stressed human sinfulness and the need to submit to the will of a divine
sovereign whose inscrutable cosmic plan is forever beyond our comprehension (Fromm 1941: 56-
122). Similar tendencies, however, have manifested themselves in the Catholic Church, specifically
in the Communio-theology which is currently dominant in the Vatican (von Balthasar 1968), and in
the popular twelve step programs, which, like the evangelical churches, teach that human beings
cannot control their drives and must turn their lives over to what in this case is an unnamed "higher
power."
Ideologically the link between neoliberalism and cultural conservatism was forged with the help of
Austrian school economists who stressed the superiority of spontaneous social forms (the family, the
marketplace, traditional religious institutions) to the rationalizing constructs of bureaucratic planners
and redistributors. According to thinkers such as Frederick Hayek (1988: 70) morality arises
spontaneously as a result of human adaptation to the environment. Traditional morals may not be
rationally justifiable according to the canons established by rationalist thinkers from Descartes and
Spinoza to Hegel and Marx, but they have nonetheless demonstrated that they have survival value.
The new ruling bloc thus appealed both to growing antitax sentiment rooted in the hegemonic
consumerism, and to an emerging cultural conservative trend centered in the evangelical churches.
For this reason it is appropriate to refer to it as the neoliberal-conservative bloc.
Once in power, the neoliberal bloc pursued a two pronged strategy. On the one hand they set in
motion a largely successful counteroffensive against the socialist countries and the national liberation
movements, which resulted by the end of the 1980s in the effective defeat of the Soviet bloc and its
Third World allies --though not of the more complex and stable Chinese state. This greatly
weakened the position of the peasantry, the proletariat, and the intelligentsia around the world, and
undermined the credibility of even moderate progressives proposing modest programs of increased
taxation, and state expenditure and regulation.
High levels of military spending secured the alliance between multinational finance capital and the
military-industrial complex and the national security bureaucracy. At the same time they set in
motion an assault on the national bureaucratic redistributional and regulatory apparatus, attacking
funding for infrastructure development, education, social services, and nonmilitary research and
development, and interfering systematically with the activity of critical planning and regulatory
agencies, while drastically reducing taxes on the bourgeoisie and the upper middle strata. The result
was a speculative boom based on high levels of military spending and luxury consumption, while the
country's physical and social infrastructure literally rotted away (Davis 1986).
Already by the middle 1980s the limits of this strategy were becoming apparent. As defense
spending peaked, and rising federal deficits prevented further reductions in levels of taxation, the
economic engine which had driven the boom ground slowly to a halt, first in the farm-belt and the
industrial midwest, then in Sunbelt metropoles heavily dependent on military spending, and finally
on the coasts. The collapse of the Soviet bloc, and the resulting prospect of even lower levels of
military spending, in the context of the prevailing neoliberal strategy, has meant not increased funds
for the civilian sector, but a further contraction of state expenditures, and a deepening crisis
throughout all sections of the country.
In analyzing the current crisis it is important to distinguish between the cyclical recession which
began during 1988 or 1989, and which ended sometime last year, and the deeper crisis of the
neoliberal regime of accumulation. If the recovery from the most recent dip in the business cycle
has been so anemic, and if we are perhaps on the verge of yet another cyclical downturn before the
effects of the "recovery" of 1991-1992 have even been felt, then it is because the neoliberal
strategy for economic development is largely exhausted, and no new strategy has emerged to take its
place.
There are, broadly speaking, two distinct but interrelated dimensions to the current crisis. On the
one hand, the penetration of market relations into every sphere of life, together with the collapse of
bureaucratic forms of regulation and social integration, has set in motion an ever deepening crisis of
the ecosystem and of the social fabric. The marketplace, as we noted above, has no way to know
how the activities it organizes affect the integrity of the ecosystem. So long as customary or legal
restraints are in place, the damage to the ecosystem may well be gradual and even imperceptible.
But once these restraints have been stripped away, the delicate balance of life itself is in danger.
Similarly, at the social level, the marketplace functions like a solvent, which dissolves the bonds of
family, clan, village, region, and nationality so that individuals can be combined in new ways by
industrial modes of production. In this sense, market societies have always depended on a reservoir
of nonmarket institutions, --a literal or figurative countryside-- from which to draw individuals who
have been socialized by stable families, trained in quality schools, and in general formed into
productive, powerful, rational human beings capable of forming stable bonds with others --able that
is, to use the language of the psychoanalytic tradition, to love and to work. The destruction of this
nonmarket hinterland means that such individuals are no longer being socialized, with results that
are apparent from the ghettos of South Central Los Angeles, to the prosperous suburbs such as
Plano, Texas --teenage suicide capital of the country (Lasch 1979, Bellah 1985, 1991).
Second, the marketplace itself has no way to know how the activities it promotes affect the
development of human social capacities. Once again, so long as the marketplace was surrounded by
a complex of (private and public) nonmarket political, social, cultural, scientific, and religious
institutions, it was possible to centralize the resources necessary to develop the infrastructure,
educate workers and citizens, promote artistic and cultural expression and scientific discovery, and
cultivate human spirituality, even where these activities did not themselves lead to the accumulation
of capital. As traditional communitarian institutions declined, or where they were unable to carry
out the organizing tasks required, bureaucratic institutions took their place. Twelve years of
neoliberal hegemony, however, has all but completed in short order the gradual erosion of these
nonmarket institutions which has been underway for several hundred years, with the result that
social progress, understood in terms of qualitative advances in technology, organization, art,
science, and spirituality, is slowly grinding to a halt. Nonmilitary state expenditures have failed to
keep pace with the need for investment in infrastructure, education, research, and development, and
in many cases have declined, while generous tax cuts for the very wealthy have undermined the
incentives both for private investment in new technologies, and for contributions to nonprofit
institutions. Thus the current "crisis of capital formation."
If we continue on our present path, the planet's ecological and social infrastructure will surely be
destroyed within another one or two generations. At that point the only hope for the human
civilizational project will be to preserve the heritage of our own civilization through a long period of
chaos and degeneration, and attempt a new beginning once the planet has recovered. We will argue
in the next section, however, that there is some reason to hope that the balance of power is shifting
and that the period of neoliberal hegemony is coming to an end. There is growing recognition, not
only among the masses, who are largely unorganized, but also among certain sections of the ruling
class, that we cannot continue on our present path. The upcoming Presidential election may will
bring to power a new ruling bloc. In order to understand this new dynamic we need first to analyze
in some detail the current alignment of social forces.
III. Towards an Alliance for Social Progress
A. Analysis of the Social Forces
The specific way in which capitalism has developed during the course of the past twelve years has
had a profound impact on the class structure of the world capitalist system. It will be useful at this
point to identify the principal strata and fractions within the bourgeoisie and the working class, as
well as the intermediate social strata which are neither bourgeois nor proletarian.
We regard as bourgeois all those elements in society which derive the majority of their income from
surplus produced by others, even if they themselves perform useful social labor. Traditionally the
bourgeoisie has been divided into financial, services, industrial, construction, extractive,
commercial, and agricultural fractions, depending on the type of capital which they hold, or the
activities in which they are engaged. Increasingly, however, each of these fractions is characterized
by growing levels of internal differentiation, and often by sharp internal contradictions.
The principal contradiction within finance capital is between the large commercial banks, which
derive their revenues from interest on loans, and the investment banking houses involved in trading
stocks and bonds. This is particularly true in the United States where investment bankers are
protected from competition from the large commercial banks by the Democratic Glass-Steagull Act.
High interest rates, furthermore, tend to drive down the price of stocks. Investment bankers thus
have indirect interests in common with the industrial sector of the bourgeoisie (Ferguson 1992a:
476). Insurance companies often support improved product safety legislation, and real estate
developers often support investment in infrastructure, even as they otherwise drain capital that might
have been invested in other, more progressive activities.
Within the growing service sector there are sharp differences between capitalists involved in
personal services and those providing technical or professional services to individuals, businesses, or
government. Personal services require a large pool of unskilled, low wage labor, and of high
income households able to devote a significant portion of their incomes to luxury consumption. The
growing complex of information processing companies, computer services, research and
development and technical services concerns, on the other hand, requires a highly educated work
force, and gets most of its business from advanced industrial corporations or from the public sector.
Once again the military remains one of the largest purchasers of high-end professional services in
the country. Some sectors of the information processing industry (software, computer services) face
serious obstacles to international expansion (the difficulty of producing software useful in many
languages) (Ferguson 1992b: 174).
Industrial capital is divided first and foremost along technological lines. Broadly speaking it is
possible to identify four distinct fractions:
* low technology sectors which can no longer survive without some protection: textiles, food
processing, etc., and which have little or no stake in investment in infrastructure, education,
research, and development,
* medium technology sectors such as auto and most consumer durables industries, which are
facing increasing pressure from international competition, and which have only a limited
stake in investment in infrastructure, education, research, and development,
* high technology sectors such as electronics, computers, telecommunications, aerospace,
machine tools, scientific instruments, etc., which enjoy a long term comparative advantage in
international trade but which are having difficulty centralizing the resources they need to
develop new products, and which are beginning to suffer from low levels of investment in
infrastructure, education, research, and development, and
* emerging synergistic sectors such as solar energy and biotechnology.
Construction a peculiar sector in that tends to be low technology and labor intensive, but nonetheless
embodies certain progressive impulses. Construction companies have an interest in state investment
in infrastructure, both because it is a direct source of revenue for them, and because a sound
infrastructure is the precondition for expanded private sector industrial, commercial, and housing
development.
The extractive sector is clearly dominated by the petroleum industry, which is unique in that it is an
essentially intermediate technology activity which remains internationally competitive due to the
state's failure to support development of alternative energy sources. The petroleum industry
together with other extractive and mining interests with a few exceptions constitute a major obstacle
to the development of ecologically sound technologies.
Agricultural capital is characterized by high levels of internal differentiation, with grain producers
anxious to see foreign markets opened up to absorb their enormous surpluses, and fruit, vegetable
and tropical products producers vigorously resisting free trade agreements which could wipe them
out.
Commercial capitalists, especially large retailers, have an interest in lower consumer interest rate
and rising real incomes, and thus an affinity for demand side economic strategies.
The structure of the bourgeoisie is further complicated by the fact that many corporations operate in
several very different sectors of the economy, which may have conflicting interests. We have
already noted the contradictions between transnational, multinational, and national capital. The
precise composition of each of these sectors changes as the international economy itself evolves.
Ordinarily, one would expect the high technology sectors of the bourgeoisie to be the most
progressive, and there is probably a long term trend in this direction. This picture is complicated,
however, by the fact that many advanced industrial sectors have developed strong ties to the military
industrial complex (electronics, telecommunications, aerospace), and others (chemicals, the medical-
industrial complex) have a short term interest in limiting environmental regulation or the
development of a national health care system.
There exists a small African American and Chicano national bourgeoisie. This sector of society
has, however, tended to decline as the end of legal segregation and the advent of affirmative action
programs has made it possible for members of oppressed nationalities to secure positions in the
bureaucracy which are generally more rewarding in terms of income, power, and status than running
a small business that serves a ghetto community. Many African American and Chicano capitalists
are in fact neocolonial elements who serve to link their communities economically to the larger
North American market. The social basis of nationalist tendencies in these communities is located
largely in the lower ranks of the bureaucracy and among the proletarianized intelligentsia.
Between the bourgeoisie and proletariat, it is possible to identify several intermediate strata:
* The Petty Bourgeoisie --small working entrepreneurs who retain the surplus which they
produce, but do not extract significant surplus from other workers. It is useful to further
divide the petty bourgeoisie between "traditional" and "new" fractions.
The traditional petty bourgeoisie consists largely of merchants, shopkeepers, and
owners of small personal services establishments (hair styling salons and barber
shops). This stratum tends to be highly identified with the sectors of society which
constitute it market. Inner city merchants, owners of working class taverns,
independent professionals and consultants, and owners of chic boutiques are all more
likely to identify with their clients than they are with each other. The traditional petty
bourgeoisie never constitutes a unified social force. Inter-ethnic conflicts (e.g.
between Korean merchants and African American workers) can often undermine the
unity between small businessmen and their clients.
There is one exception to this pattern. Small farmers constitute a distinct fraction of
the traditional petty bourgeoisie with their own interests and their own traditions.
The new petty bourgeoisie on the other hand consists largely of small enterprises in
emerging fields --solar energy, technical services and consulting operations of various
kinds, software development, etc. This stratum is generally characterized on the one
hand by a commitment to development of human social capacities --their work often
involves them directly in developing new technologies, or training others in new
skills--- and on the other hand by an anarchistic resistance to large organizations.
Many members of this stratum established their businesses after the corporate or state
bureaucracies proved unreceptive to their ideas.
* The Bureaucracy. This stratum consists of salaried working intellectuals whose salaries
have not been driven down to proletarian levels --i.e. who retain control over the surplus
which they produce, and who may even use a monopoly on knowledge or organizational
ability to garner a share of the surplus extracted by the bourgeoisie. This stratum is sharply
differentiated by sector.
1) The corporate bureaucracy largely shares the interests of the capitalist sector in
which it is employed, except that there is an ongoing struggle between managers and
stockholders, and banks, over the division of surplus between managerial salaries,
dividends, interest, and new investment.
2) The national security bureaucracy (including the military itself, together with
Department of Defense, State, and Energy civilians, the intelligence community and
defense and national security contractors) is essentially an advanced political
leadership cadre which in other countries (i.e. the socialist countries) has played a
progressive role. In the U.S. however, it entered into an alliance with capital to
defend the market system, while carving out for itself a nonmarket niche which would
be the envy of its Soviet counterpart. Reduction in defense outlays will make this
sector highly volatile, in that it is less able to "retool" for civilian activities than the
advanced industrial sector. There is some evidence of progressive trends, especially in
the intelligence community, but the dominant tendency will be towards the fascist
right.
3) The social development bureaucracy consists largely of the upper echelons of the
education, social service and health and nonmilitary research establishments, including
both public sector and non-profit organizations. Organized to develop human social
capacities, this is an unambiguously progressive sector which is limited more by its
low level of organization and by the influence of backward ideological problematics
than by the very limited privileges it enjoys.
* The Clergy: Similar to the bureaucracy in many ways is the clergy. The clergy is a
residual feudal class living off of quasitaxes (religiously mandated donations, tithes, etc.).
While its ideological impact is generally reactionary, some sectors of the clergy have
supported policy measures designed to slow the disintegration of the social fabric, and to
support the development of human social capacities. The economic interests of various
clerical sectors are partly determined by their religious ideologies. Catholic and Jewish
institutions tend to thrive in tight ethnic communities with intact nonmarket social networks
which they partly help to conserve, while evangelical churches flourish in highly fluid
mobile communities where market relations dominate. This is true both because evangelical
piety is a reflex of market relations, which make the self-organizing activity of the cosmos
appear to be a mysterious force beyond human control, and because evangelical churches
provide a place where isolated individuals can find "a sense of community" without taking on
cumbersome social responsibilities.
We use the term working classes to designate those strata which derive all of their revenue from
productive labor, and from whom all or most of the surplus product is extracted either through
market mechanisms or through the wage relationship. The working classes include the peasantry and
the proletariat.
The peasantry, as distinct from traditional petty bourgeois farmers, consists of those small agrarian
producers whose surplus is extracted by market mechanisms (unequal exchange) and which is
inserted in residual communitarian structures (the village community). This sector is of little
importance as a force within the United States (with the exception of the Indian communities and
some Hispanic communities in Northern New Mexico and Southern Colorado). Displaced peasants,
however, form the largest portion of new immigrants to the U.S. from Asia and Latin America, and
the communitarian traditions of this sector constitute an important strategic reserve for progressive
forces. The peasant community, and residual communitarian traditions among newly proletarian
workers, have historically served as the principal basis for the emergence of socialist consciousness
in capitalist societies.
The proletariat includes all those sectors of society who derive their income from the sale of their
labor power, and from whom all or most of the surplus they produce is extracted through market
mechanisms. The proletariat is differentiated internally according to levels of skill, and the sector in
which it is employed --a pattern of differentiation which often intersects with ethnic and gender
differences. It is possible to identify:
1) a large unskilled pool of personal services, retail, and assembly workers, many of whom
are women, and who are drawn predominantly from the oppressed African American,
Chicano, and American Indian nations, and from oppressed immigrant nationalities,
2) broad strata of semiskilled
a) operatives employed in various intermediate and high technology industries, and
b) clerical workers employed in all sectors,
3) skilled
a) craftsmen and foremen employed in intermediate technology sectors
b) technicians employed in high technology sectors, and
4) proletarianized intelligentsia --i.e. those salaried professionals employed in sectors where
market forces have driven salaries down to the point that most of the surplus which they
produce is extracted. This includes, especially, those employed in the education, social
services, health (except physicians), and nonmilitary research sectors.
It is important to understand the ways in which the type of work person performs, and their position
in the relations of production affect their interest in and approach to synergism. Generally speaking
members of the proletariat and the peasantry have the strongest interest in synergism, because the
entire surplus which they produce is already available for productive investment (they have nothing
to lose) and they are accustomed to organized, disciplined, cooperative labor. Within the peasantry
and proletariat, there are some distinctive differences. Peasants and workers who have preserved
the traditions of the village community in highly organized urban neighborhoods bring to the
struggle an intact social fabric --an immediate, albeit often pre-rational grasp of the underlying unity
and order of the cosmos, and an intact ability to rear children, work collaboratively, and develop
public relationships. Members of such communities, on the other hand, often have a relatively weak
grasp of the development of human society towards increasingly complex levels of organization.
Workers in intermediate technology sectors (the historic stronghold of the labor movement) have a
long history of organized class struggle, but are largely organized as an interest group working to
realize individual consumption interests. Skilled workers in high technology sectors, and members of
the working intelligentsia bring to the struggle an experience of participation in the development of
human social capacities. High technology workers and intellectuals, however, are often socially
disconnected and have lost their sense of the underlying unity and order of the cosmos. These
differences have important implications for our organizing strategy --a matter we will address in a
later section of this article.
B. Political Trends
We need at this point to assess the level of organization and strategic orientation of each of the
principal social forces identified above. While social classes and class fractions constitute the
building blocks of political trends, organized social forces generally bring together elements from
several social strata under the leadership of one or more hegemonic elements.
The core of the hegemonic neoliberal-conservative bloc has remained intact through the current
crisis, largely because of the perceived advantages of support for the incumbent Republican
government. The large commercial banks as well as some investment houses, the multinational oil
companies and grain exporters, and high technology companies with large military contracts, all
figure prominently among the contributors to the Bush campaign (Ferguson 1992a: 446). Important
fissures are beginning to appear among subaltern elements in this bloc --the full dimensions of which
will probably not become apparent until the campaign for the 1996 Republican presidential
nomination gets underway. More specifically, commercial banks and multinationals with direct
investments in low technology, low wage activities in the Third World will likely try to defend the
status quo while reducing the burden of a military industrial and national security apparatus they no
longer regard as necessary. This trend was reflected in a recent forum held by the Council on
Competitiveness on the future of the National Laboratory System at which several industrial leaders
argued that the labs should be neither retained in their present form nor converted to civilian uses
but simply shut down. Discontent from protectionist textile, shoe and clothing interests, and from
small speculators and entrepreneurs anxious for another tax break, on the other hand, have already
financed Patrick Buchanan's break to the right. Speculative sun-belt interests also seem to have
provided at least a secondary source of support for the Perot campaign --though these interests are
ultimately out of tune with Perot's long term strategy. At the same time, advanced industrial firms
which formerly relied heavily on defense contracts, as well as the national security bureaucracy
itself, will likely undergo a period of disorientation. Two distinct trends have emerged within this
sector.
1) Military imperialists seek to preserve as much as possible of the military industrial
complex by arguing that U.S. economic power depends on military superiority. Proponents
of this position are arguing in effect that the U.S. cannot compete with Europe and Japan in
civilian technology, but enjoys a comparative advantage --even a monopoly-- in the military
arena, and that we should preserve and even deepen our specialization in this economic
niche. Military imperialist forces will likely enlist some support from elements interested in
activities which cannot be supported by the marketplace, but which might find a place in the
military's vision of the future --e.g. space exploration, especially manned space exploration.
This trend may also be well positioned to tap into culturally conservative tendencies with an
increasingly self-conscious anti-market orientation. This tendency is illustrated by a CIA
report issued last year attacking Japan as a society hell bent on conquering the world through
the marketplace. This trend is clearly rich with neofascist potential.
2) Conversionists look forward to a gradual transformation of military-technological into
industrial-technological capacity and look to transform the national security apparatus into an
industrial espionage service. These elements have clearly drifted towards the Democrats, as
a former chairman of the joint chiefs of staff, and a former director of the National Security
Agency, along with several other military leaders, have endorsed Bill Clinton. On its left
fringes this trend apparently includes elements interested in transforming the intelligence
community into a kind of national information agency which would defend the ecosystem and
the social fabric against the ravages of the marketplace (Steele 1992). This sector will likely
drift towards alignment with the emerging Democratic bloc, though incorporation into a
Perot-type campaign for organized capitalism is by no means out of the question --nor for
that matter is a unified anti-market, corporatist thrust incorporating both military and
conversionist elements.
The hegemony of the neoliberal-conservative bloc over broad layers of the population has been
undermined, meanwhile, by prolonged economic stagnation, and by growing alarm over the impact
of neoliberal policies on the integrity of both the ecosystem and the social fabric. The rhetoric of
"Judeo-Christian civilization" and "family values" has come to seem increasingly shallow as workers
come to understand that it is the marketplace and not the activities of bureaucratic planners which
are destroying their families, neighborhoods, and churches. We should keep in mind, however, that
the social basis for evangelical piety remains intact. It is also important to keep in mind that even if
the North American neoliberal-evangelical alliance is somewhat discredited, the international allies
of this alliance have been enormously strengthened by the crisis of socialism and by the continuing
rightward drift of the Roman Catholic Church. The Vatican plans to promulgate a new catechism at
the end of this year, which will probably make Communio- theology official church teaching, and
will bar teachers in Catholic institutions at all levels from teaching anything contrary to this
theology. The Church is also aggressively pursuing an alliance with Austrian school elements
throughout eastern Europe and has established a new theological center in Liechtenstein, with
massive support from the remnants of Europe's decayed nobility at which it hopes to train a new
intellectual elite for the counterrevolutionary governments of the East.
Some culturally conservative elements --those most concerned with actually conserving traditional
institutions-- will probably break loose from neoliberal hegemony. These elements may drift in a
more explicitly authoritarian direction, and make common cause with reactionary protectionist
elements on the bourgeois right, and with military imperialists seeking to defend the national
security apparatus and the military industrial complex.
Others --particularly new petty bourgeois elements based in high technology sectors, and knowledge
based services sectors, and elements of the technical intelligentsia-- may drift towards more new
forms of religious alienation, more compatible with neoliberal economics.
There is no ready English or even German word that precisely characterizes an extended
order, or how its way of functioning contrasts with the rationalists requirements. The only
appropriate word, `transcendent,' has been so misused that I hesitate to use it. In its literal
meaning, however, it does concern that which far surpasses the reach of our
understanding, wishes and purposes, and our sense perceptions, and that which
incorporates and generates knowledge which not individual brain, or any single organization,
could possess or invent. This is conspicuously so in its religious meaning, as we see for
example in the Lord's Prayer, where it is asked that thy will [i.e. not mine] be done on
earth as it is in heaven ... But a more purely transcendent ordering, which also happens to be
a purely naturalistic ordering (not derived from any supernatural power), as for example in
evolution, abandons the animism still present in religion; the idea that a single brain or will
(as for example that of an omniscient God) could control and order (Hayek 1988: 72-73).
Particularly interesting in this regard is physicist Frank Tipler's attempt to provide a scientific
(physical) basis not only for belief in God, but traditional Christian doctrines of divine grace and
eternal life (Tipler 1989).
The result of this process of disintegration will probably be the emergence of two well defined
rightist blocs, and a centrist periphery. On the far right, protectionist elements in declining low
technology industries, military imperialist elements in the military industrial complex and the
national security apparatus, speculative small investors anxious to recover the prosperity which they
enjoyed in the 1980s, and the most reactionary elements of the evangelical and Catholic right will
come together to form a traditionalist bloc with strong fascistic overtones.
The core of the neoliberal coalition, on the other hand --large commercial banks and multinationals,
together with much the military industrial complex, will continue to argue that the principal obstacle
to capital formation remains high levels of taxation and state expenditure, while resisting economic
conversion and military spending cuts.
On its left the neoliberal bloc will shade off into a liberal Republicanism which draws its support
from advanced industrial elements and technical services firms anxious to convert from military to
civilian production, more progressive elements in the national security apparatus, and engineers,
skilled workers, and others in the high technology sector. The interest of these elements in
neoliberal, free market policies has less to do with a desire to redeploy capital abroad to low wage,
low technology activities, than with their own position in the relations of production: that of
innovative small entrepreneurs adapting to highly specialized niches in an increasingly complex
economy --niches which could never have been "planned" by state bureaucrats. These elements will
support both anti-bureaucratic cost cutting measures and increased investment in infrastructure,
education, research and development --and most especially in technology transfer. At the cultural
level, this sector will gravitate towards a secular form of Calvinism.
These blocs will increasingly differentiate from each other as the 1996 Republican election campaign
approaches, and then try to achieve a hasty rapprochement as a leading candidate emerges, and
attempts, probably unsuccessfully, to reassemble the neoliberal-conservative coalition which served
the party so well during the 1980s, with liberal Republican elements gradually drifting towards the
Democratic camp.
In opposition to the hegemonic neoliberal bloc, we are witnessing the emergence of a complex new
opposition. This new coalition has taken form only gradually, as the result of more than a decade
of struggle between several very different tendencies. Throughout most of the 1980s the only
consistent bourgeois opposition to the dominant neoliberal bloc came from relatively small groups of
investment bankers concerned about high deficits and high interest rates, and real estate developers
anxious to shift state funding from the military to the inner cities and to infrastructure development.
These interests were at the core of the coalitions which financed the Presidential campaigns of
Walter Mondale and Michael Dukakis, and would likely have dominated a campaign by New York
Governor Mario Cuomo. In 1992, it was the (tremendously unsuccessful) campaigns of Nebraska
Senator John Kerry and Iowa Senator Tom Harkin which most nearly matched this profile. These
campaigns were all characterized by a consistent rhetoric of fairness intended to mobilize support for
investment in infrastructure in the inner cities and a commitment (more prominent in the case of
Mondale than Dukakis), to draconian tax increases in order to reduce the deficit (Ferguson 1992a:
475ff).
Towards the middle of the 1980s these sectors were joined by elements within certain nonmilitary
high-technology sectors, especially smaller manufacturers in the personal computer industry,
together with elements in the growing software and computer services industries --the so called
Atari Democrats who supported Colorado Senator Gary Hart. These same elements also formed the
core of Paul Tsongas' campaign for strategic trade policies, reduced interest rates, and subsidies for
high technology manufacturing industries (Ferguson 1992a: 475ff). Hart, and to far lesser extent
Tsongas, attempted to expand on their base among high technology capitalists by appealing to
intellectuals and skilled workers with a liberal approach to social policy, promises for increased
funding for education, several proposed environmental initiatives, and a commitment (which Walter
Mondale was unwilling to make) to end U.S. support for the counterrevolution in Central America,
and more generally to adopt a more collaborative attitude towards the national liberation movements.
These elements favored the analysis of the current crisis developed by University of Texas
economist James Galbraith (1990) and Thermo Electron president George Hatsopoulos (who was one
of Paul Tsongas' chief economic advisors). This analysis centered on the deepening capital
formation crisis. Throughout much of the 1980s, they point out, U.S. industrial corporations
suffered from high interest rates, engendered in part by high federal deficits, and unfavorable
exchange rates that made the cost of capital prohibitive. Galbraith has also stressed the limits placed
on demand for high technology capital goods by the enormous debt burden of the developing
countries which constitute the principal market for such goods. Reduced interest rates, federal
deficit reduction through a combination of cuts in defense spending and higher taxes, devaluation of
the dollar, and reduction of Third World debt burdens form the core of the "strategic trade" agenda
favored by this tendency.
Serious criticisms have been raised regarding certain aspects of this analysis (Ferguson 1992a: 477).
Declining interest rates and a falling dollar over the past few years do not seem to have sparked
investment in advanced industrial sectors. Left economists have pointed out that capital is unlikely
to flow into capital intensive high wage industries so long as it can find an outlet in the Third
World. It would be a mistake, however, to overlook the progressive drift of this tendency. It
represents a frontal assault by nonmilitary advanced industrial sectors against the hegemony of the
commercial banks and multinational corporations. What did became clear during both campaigns is
that these sectors were unable, on their own, to assemble the kind of broad based coalition which
was necessary to break the power of the hegemonic neoliberal bloc. While both Hart and Tsongas
were able to draw significant support from the intelligentsia (especially the technical intelligentsia)
and allied elements in the corporate bureaucracy, neither was able to mobilize the masses of workers
marginalized by years of neoliberal austerity. This was particularly true of workers in the midwest
and the south, who are essential to any Democratic Party victory. This is true in large part because
they failed to advance significant proposals to develop the productive capacities of the working class
and make them real participants in the transition to a higher stage of industrialization.
A somewhat different attempt on the part of elements within the nonmilitary high technology sector
to break neoliberal hegemony was represented by Ross Perot's 1992 venture into Presidential
politics. Perot has a long history of political engagement, as part of a group of Texas capitalists and
public officials interested in weaning Texas away from its traditional reliance on agriculture and the
petroleum industry, and to develop an economy based on electronics, computers, biotechnology, and
other "science based" industries (Ferguson 1992b: 174). This group is bipartisan, and includes both
Republicans such as Tom Luce and Democrats such as Henry Cisneros, as well as nonpartisan
organizations such as the Texas Interfaith Network, a congregation based organization which turned
out 10,000 organized participants at its 1990 founding convention. Perot joined to this core a
number of key leaders from the computer industry, including Charles Sporck, founder of National
Semiconductor, and Scott McNealy, president of Sun Microsystems, along with a number of
financiers and investment bankers, including Michael Dingaman of Abex, Inc., A.C. Greenberg of
Bear, Stearns; Thomas Forstmann; William Simon and, with some reluctance, Felix Rohatyn.
At the programmatic level, Perot shared the emerging consensus in high technology sectors circles
that free operation of the market was inadequate to guarantee investment in infrastructure,
education, research and development, and that free trade, without state support for strategic
industries would be inadequate to guarantee the position of even highly efficient U.S. industries in
the world market. Through the course of the campaign he placed increasing emphasis on the role of
the federal deficit in absorbing capital which might otherwise have been more productively
deployed. But he joined to this consensus a new emphasis on organization (Ozaki 1991). U.S.
corporations pay their executives exorbitant salaries and their shareholders unusually generous
dividends by comparison with most European or Japanese corporations. Salaries and dividends,
furthermore, often bear no relationship to corporate performance. The economic strength of private
and institutional investors means that corporations are often forced to pay out large dividends rather
than investing in research and development, and that dividends paid are often absorbed in luxury
consumption rather than into the operations of related corporations. At the middle and lower
echelons, corporation organization theorists point out, U.S. corporations are characterized by
redundant layers of middle managers who contribute little or no value added, and in fact may do
more to stifle than to catalyze the creativity and productivity of the productive work force.
Corporate organization theorists generally favor development of a North American variant of the
"organized capitalism" that prevails in Japan and Germany, coupled with streamlining and
decentralization of management, and promotion of worker initiative and collaboration in shop floor
management. Representatives of this tendency point to the success of Japanese corporations
operating in the U.S., using U.S. workers, but Japanese mangers and corporate structures to
document the strength of their analysis.
Building on his own experience at Electronic Data Systems, Perot advocated a massive
rationalization of bureaucratic structures in the U.S., including the corporate and national security,
as well as the education and social service bureaucracies. This restructuring would eliminate large
layers of middle management, increasing productivity and empowering workers, but also vastly
increasing the flexibility enjoyed by senior managers. Senior managers, meanwhile, would be held
accountable for corporate performance by authentically independent boards of directors.
Perot's attack on middle management meant that from the beginning he would have to seek a
different mass base than that cultivated by Tsongas and Hart, who drew many of their votes from
upwardly mobile members of the intelligentsia, who either were, or who hoped soon to become part
of the bureaucratic middle management which Perot sought to rationalize --but who had little
prospect of becoming senior managers or chief executives. Perot instead sought support from the
broad masses of workers and members of the petty bourgeoisie who had been hurt by twelve years
of neoliberal neglect, who were increasingly aware that the marketplace alone could not guarantee
the continued development of U.S. society, but who resented the privileges enjoyed by bureaucrats
in both the private and the public sector, who were sheltered from the market pressures which were
tearing their own lives apart. Perot sought to mobilize those masses of Americans who said
repeatedly on surveys that they were willing to pay higher taxes in order to support certain specific
initiatives such as education, but who were manifestly unwilling to be taxed in order to pay for
increases in the salaries of Congress or congressional staffers, GS-15 public servants, or the large
bureaucracies which ran their school boards and their state, county and municipal governments.
It is thus not surprising that Perot's campaign should have taken on a quality which was at once
authoritarian and populist in character. Perot had a longstanding relationship with the Industrial
Areas Foundation, which had built a successful network of 12 congregation-based organizations in
Texas, largely with the aid of the Roman Catholic hierarchy. And his own organizational style was
certainly paternalistic and even feudal. Those who feared a quasi-fascist presidency if Perot was
elected were not far from the mark.
Perot's rapid ascent, sudden withdrawal, and late return the race --apparently something he had
planned from the beginning-- remain something of a mystery. Thomas Ferguson has suggested that
Perot withdrew because he felt their was a danger that his campaign would become a vehicle for
reactionary supply side interests who would support his effort to rationalize state, but not private
bureaucracies, and who would support his proposals for reductions in capital gains taxes and federal
spending, but not his campaign for state investment in infrastructure, education, research, and
development. Perot had tangled with this sector of the political right in the past, during the Nixon
administration, and had no desire to repeat that episode. More likely, he never intended to win the
election but was simply a vehicle of investment banking and high technology interests which wanted
to draw public attention to the growing budget deficit, and which were concerned to insure that
increased state expenditures for infrastructure, education, research and development were
accompanied by attempts to carry out the rationalization of bureaucratic structures which two
Republican governments had promised but never carried out. The candidacy may also reflect the
concerns of ruling class elements which recognized the need for a radical change in policy, but
which are also concerned that a Clinton victory might strengthen the position of the working classes
and lead to a rebirth of progressive mass movements.
In the end it was a campaign based in the regional bourgeoisie of a relatively backward Southern
state which was able to both assemble a coalition which united most of the more progressive sectors
of the bourgeoisie, and to build a mass base sufficient to break the neoliberal stranglehold on the
state apparatus. Arkansas Governor Bill Clinton's core of support comes from agricultural,
extractive, food processing, retailing, and investment banking interests in his home state, including
Tyson Foods, Murphy Oil, the Stephens family, the Walton Family (owners of Wal-Mart) and
Beverly Enterprises, a large private health care provider. But Clinton has been able to build on this
core of support, winning over many of the investment bankers who flirted with but eventually
abandoned Ross Perot's campaign, especially those with a Pacific orientation and close ties to
Japanese capital, large communications companies, and, especially since the collapse of the Tsongas
and Perot campaigns, increasingly large sectors of the nonmilitary advanced industrial bourgeoisie,
and the computer software and services sector --Apple, Xerox, and Western Digital Data
(Albuquerque Journal, Ferguson: conversation) are particularly prominent in this regard. It is
interesting to note, in this regard, the presence in the Democratic camp of high technology firms
with strong consumer and educational markets.
It is, no doubt Clinton's commitment to investment in infrastructure, education, research and
development which has made it possible for him to forge a coalition between these very disparate
interests. Clinton has drawn, in this regard, on the work of Harvard economist Robert Reich.
Reich argues that the emergence of a global economy has effectively doomed U.S. low and
intermediate technology industries which utilize low wage, low skill labor. The United States
cannot hope to compete with Mexico or China in textile and garment production, unskilled assembly
work, etc. Effective participation in the global market requires that the United States build on its
comparative advantage in high technology, high skill sectors. This requires, first and foremost,
increased state expenditure, and ultimately increased taxation, to support infrastructure development,
education, research, and development. Reich's influence is apparent in Governor Clinton's
commitment to development of high-speed rail, fiber optic networks, education, technology transfer,
etc.
Investment in infrastructure and education is the precondition both for the development of the still
relatively backward sections of the South and for effective competition on the part of U.S.
nonmilitary high technology firms in international markets. Clinton even appears to be winning a
section of the national security bureaucracy and the military industrial complex with a commitment
that reductions in defense research and development will be matched by a comparable increase in
civilian research and development.
It is this dimension of his program as well which has caught the imagination of the broad masses of
North Americans dissatisfied with twelve years of neoliberal policies which have enriched a small
minority while permitting the country as a whole to stagnate. Much of the left wing of the party has
expressed disappointment over Clinton's nomination, and is concerned when they hear him speak of
the need for "investment" rather than "meeting human needs." Clinton has, to be sure, conceded
rather more than was necessary to racism and class chauvinism, particularly in his discussions of
welfare reform and criminal justice issues. But the left, which has spent the past twelve years
defending the subsistence rights of the masses, has clearly failed to grasp the principal progressive
political dynamic of the present conjuncture. Taxing the "wealthiest Americans to fund investment
in developing human social capacities (Clinton's New Covenant) is substantively far more
progressive than taxing upper strata workers to fund transfer payments for the destitute masses
(Johnson's Great Society).
It is the neoliberal and the emerging progressive bourgeois trends which constitute the poles around
which political struggle at the electoral level continues to organize itself. At the same time, there
are other important trends which are strong enough to exercise some impact on public policy, and
even more impact on the political development of the masses. Of these trends, the two most
important are based in the middle strata --the clergy, the bureaucracy, the petty bourgeoisie, and the
intelligentsia.
The deepening social disintegration of market societies, coupled with the crisis of socialism, has led
to the emergence of a non-socialist but anti-market trend based in the clergy and religious
institutions, and among senior elements in the social development bureaucracy. Sometimes referred
to as communitarian (Bellah 1991: 6), this trend is better described as "institutionalist."
Institutionalism has its roots among the clergy and some lay leaders of "centrist" religious
institutions --Roman Catholics, Anglicans, a few moderate Lutherans and Presbyterians, and some
orthodox and conservative Jews-- as well as among senior members of the academic and social
development bureaucracies. These institutions have historically served as conservers of nonmarket
social networks, while at the same time being centers of resistance to the intensive rationalization
promoted by the socialist and communist left. The trend is united by a commitment to resist the
breakdown of the family structure and of "mediating institutions" such as the church and synagogue,
the school, the neighborhood organization, etc. The trend is unique in that it attributes this process
of social disintegration to both market and bureaucratic institutions, and in this rejects both
neoliberalism and socialism. Increasingly, prominent intellectual members of this trend --Robert
Bellah (1985), Christopher Lasch (1990)-- have been drawn as well towards a "postmodern"
rejection of rationalist ethics, and argue that meaning and morality are possible only in the context
of a particular tradition or a particular community.
Organizationally, this trend has received its most advanced expression in the congregation based
organizing movement led by the Industrial Areas Foundation (IAF). Founded in the late 1930s with
the support of progressive Chicago capitalist Marshal Field, the Catholic hierarchy, and the State
Department, (Industrial Areas Foundation 1990, Mansueto 1991) in order to stem growing
communist influence within working class communities, the IAF is a disciplined cadre organization.
Organizers, funded by generous contributions from local congregations and national judicatories,
conduct a series of individual meetings in order to identify potential leaders and map out their
interests and networks. The most advanced leaders --those who are interested in organizing as well
as in struggle around particular issues-- receive special training and are recruited to local strategy
teams. This focuses largely on understanding power and organization, on the conduct of issue
campaigns, and on direct action tactics. Efforts to incorporate systemic social analysis are
vigorously resisted. The IAF has successfully resisted efforts at the development of left-wing
concentrations within its ranks.
After years of organizing Euro-American Catholic working class communities, the IAF turned in the
1970s to the Hispanic Southwest. The IAF currently has some 25 organizations, and is strongest in
Texas and Southern California, and in some scattered areas along the East Coast from New York to
the Washington D.C. suburbs. The IAF has close ties to the same group of progressive capitalists
which supported Ross Perot, and has in fact helped to develop Perot as a mass leader. The IAF
works at once to rebuild mediating institutions, particularly local churches and synagogues, and to
reorganize them into an effective political force. Objectively, IAF organizations serve as a strategic
reserve for the progressive bourgeoisie. The IAF is most powerful in regions (such as Texas) where
the progressive forces are weak and where it has become an important component of the progressive
bloc. The same organizing techniques have produced only modest political results in other regions,
such as New York or Baltimore, where progressive forces are stronger and the value of strategic
reserves such as the IAF less significant.
On the left, certain theoreticians of the trend (Bellah) have advanced interesting proposals to
restructure corporations, using the corporate charter to mandate some level of social responsibility
and accountability, without creating new bureaucratic structures. On the right, the trend shades into
neoconservatism, and looks to the religious institutions to form people intellectually, morally and
spiritually in a way that counters the disintegrating effect of market relations.
The institutionalist trend makes some important contributions. Perhaps most important, it has
focused attention on the role of the marketplace in the disintegration of the social fabric, and the
decline of public life. In this sense it has served as an important counterweight to the religious
right. And elements on the left wing of the trend, like Bellah, have made very real contributions to
reorienting the country politically and ideologically. The Industrial Areas Foundation has conserved
and developed the organizational technology which it appropriated from the Communist Party at a
time during which the left has tended to neglect organizational matters. At the same time, the
"postmodern" anti-rationalism of trend as a whole, and its insistence on the leading role of the
hierarchy, or other "institutional leaders" makes it a potent tool for "counterinsurgency" efforts --a
role which has become quite explicit and quite conscious in the case of the IAF. In this sense
institutionalism is a nonconfessional, or better yet interfaith, latter day counterpart of the old
Christian Democracy --but a Christian Democracy endowed with a disciplined cadre and enormous
authoritarian potential (Mansueto 1991).
To the left of the institutionalist trend lie the new social movements: ecologism, feminism, cultural
nationalism, and pacificism, which emerged during the 1970s and 1980s. These movements are
based among younger members of the intelligentsia, and the new petty bourgeoisie and the social
development bureaucracy. Far from being single issue movements devoted to improving ecological
policy, struggling for women's liberation, and working for world peace, the new social movements
share a loosely defined, but ultimately unified ideology, and a system of interconnecting social
networks (though not of formal organizations). At the ideological level these movements are
defined on the one hand by a grasp of the growing interconnectedness not only of humanity, but of
the ecosystem as a whole, and on the other hand by a postmodern ideological problematic which
rejects any attempt to rationally comprehend and control this interconnectedness. Rationalism,
including, in particular, socialism, are rejected as residues of an "industrial," totalitarian, patriarchal
mentality which seeks to control the rich diversity of nature and of human cultures, and which ends
by threatening to destroy life itself.
Organizationally, the new social movements are characterized by a tendency towards anarchism and
fragmentation. These movements currently dominate the left subculture in most large urban areas,
and recruit largely by means of cultural osmosis rather than by means of any systematic organizing
initiatives. Action groups of various kinds come together around specific problems, and then
dissolve into the larger "movement" milieu. This tendency towards fragmentation is increased by
the growing influence of a "politics of identity" which organizes on the basis of gender or
nationality, and then attempts to build coalitions between groups which have decided in advance that
they have nothing in common other than the fact of their oppression. The limitations from the
standpoint of a contest for power are obvious.
Not surprisingly, the new social movements have had more difficulty articulating a positive program
than they have in advancing a critique of existing structures, though over the course of the past
decade a variety of intelligent proposals, encompassing a wide range of institutions have emerged,
including:
* development of ecologically sound technologies,
* dismantling of the military industrial complex and redirection of resources to environmental
cleanup, social services, education, etc.,
* a variety of proposals for economic and political decentralization,
* respect for the contributions of non-European cultures, and for the rights of oppressed
nationalities to self-determination,
* a new approach to family issues which integrates shared responsibility between men and
women for childrearing with a policy of radical tolerance towards "alternative family
structures,"
* a new spirituality, centered on recognition of the goodness and interdependence of
"creation," which rejects the historic Christian problematic of sin and redemption.
The new social movements have little in the way of organized strategy and have promote the above
goals using a variety of tactics including electoral and legislative struggle, nonviolent direct action,
and education.
On the left, the new social movements tend to merge with the more creative elements in the workers
movement, in so-called "red-green" coalitions, and have given new life to anarcho-syndicalist ideas
of workers' control. Not surprisingly this tendency is strongest among younger proletarianized
intellectuals. Elements within the oppressed nationality movements have spearheaded attempts such
as the Rainbow Coalition, intended to unite these forces under the leadership of the African
American and Chicano bureaucracy and national bourgeoisie --attempts which failed because
common oppression is not sufficient basis for the construction of a social movement. On the right,
there is an "eco-liberaterian" trend which argues for a continuity between the spontaneity of natural
structures, and the spontaneity of the marketplace. This trend seems particularly strong among
"eco-entrepreneurs." Certain elements in the solar energy industry, for example, argue that if
subsidies were removed from the oil and gas industry, that the marketplace by itself would insure
the triumph of solar power.
Clearly these movements have made important contributions. The new science of ecology, the
critique of the military industrial complex, of bureaucratic centralization, and of the patriarchal
family, as well as the emerging "creation spirituality," all constitute important strategic reserves for
synergism. Oppressed nationality movements have made an important contribution to the political
development of the country when they conserve and rationalize the traditions of their peoples and
make them a force for the construction of a new social order. The new social movements
nonetheless have two critical weaknesses. First, they have failed to grasp the critical role of the
marketplace in the destruction of the ecosystem, the growth of the military industrial complex, and
the persistence of patriarchal family structures. Second, the postmodern ideological problematic,
and the organizational liberalism characteristic of this trend, undermine its capacity to develop its
members theoretically and politically. These problems are rooted in the complex social forces
affecting the movements' principal constituencies. On the one hand proletarianized intellectuals
vigorously resist their proletarian condition, hoping to recover the autonomy they once enjoyed,
while members of the new petty bourgeoisie and the social development bureaucracy defend their
limited control over surplus, and of their own labor power.
The proletariat and peasantry remain either unorganized, or under the hegemony of other social
classes. In our class analysis, we identified four principal strata of the North American proletariat.
Lower strata workers are largely unorganized in their capacity as workers. There are, however,
several organizations which organize among these sectors on a non-class basis. Two trends are
particularly important in this regard. Cultural nationalist groups based primarily in the African
American and Chicano intelligentsia and social development bureaucracy have enjoyed some modest
success in cultivating a politics of identity among younger African American and Chicano workers.
On its left this tendency has strong socialist inclinations and ties to Third World national liberation
movements. The most important organizations of this kind are the Republic of New Africa and the
Movimiento de Liberacion Nacional/Tierra y Liberdad which run a joint training camp for militant
youth in Tierra Amarilla in New Mexico. A variety of community organizations provide an urban
mass base for this tendency. On its right, cultural nationalism shades into the Rainbow Coalition
which was essentially an attempt to link lower stratum workers organized on the basis of national
identity to a broader agenda which encompassed the interests of elements in the intelligentsia and the
African American national bourgeoisie. (It is interesting to note that Citicorp and Coca Cola both
contributed heavily to the presidential campaign of the Rev. Jesse Jackson.)
At the same time, the past decade has witnessed a massive expansion of congregation based
organizing, led by a variety of groups, most of which trace their origins to the Industrial Areas
Foundation. As we noted above, these organizations organize workers on the basis of their religious
traditions, and incorporate them into multiclass organizations which have become one of the
principal strategic reserves of the progressive bourgeoisie, while vigorously resisting efforts at
systemic social analysis and the development of autonomous working class organizations.
Only semiskilled operatives and skilled workers, and of these only workers employed in certain
sectors-- have been organized by the labor movement. The North American labor movement has,
furthermore, made it a principle not to develop workers beyond the level of trade union
consciousness --i.e. beyond the level of organizing to realize individual consumer interests. Not
surprisingly, this has led both to a failure to invest in new organizing, and to the political
marginalization of the labor movement as a "special interest group." Historically the labor
movement functioned as a vehicle of the hegemony of the now largely disintegrating consumer-
industrial complex (consumer durables producers) over the working class.
The intelligentsia has provided the principal base for the political left during the past three decades.
Democratic Socialists of America seems to have profited from the crisis of the Soviet bloc. It has
grown tremendously over the course of the past several years, capturing the lion's share of ex-
communists, and recruiting very successfully among the academic intelligentsia and the social
development bureaucracy. Indeed, it is very close to becoming an interest group for these strata. It
has been unable, however, to tap into the tremendous strengths of this constituency to organize
students, and young workers, for whom the fears of proletarianization are greatest, and who are
attracted to the new social movements. And it seems unable to actually do anything with its mass
base. This is largely the result of a social democratic heritage which envisions socialism as
mechanism for redistributing wealth (first and foremost to the education and social service
establishment) and for meeting human needs, rather than as a catalyst for human social
development, and because of the historic organizational laxity of the social democratic trend.
The crisis of socialism has more or less destroyed the Communist movement. The Communist
Party itself split in 1992, with the majority retreating into Neo-Stalinist orthodoxy --a stance in
which they are joined by a smattering of other left organizations, including the formerly Trotskyist
Workers World Party, which enjoys some influence on college campuses, and which is developing
ties to North Korea. The pro-perestroika minority, which calls itself the Committees of
Correspondence has become the center of an attempt at democratic realignment which incorporates
as well those elements of the new communist movement which were influenced primarily by Latin
American Marxism. Other groups exist (most notably the New Democratic Movement and the
Unity Organizing Network) which have moved towards a "reform" position from within an
essentially Maoist framework. Small groups remain which support the Maoist Shining Path in Peru,
and which attempt to tap into the voluntarism of the most desperate elements of the proletarianized
intelligentsia and marginal elements of the working class, or which conduct propaganda arguing that
the crisis of socialism vindicates their own, dissenting, Maoist or Trotskyist critiques of the Soviet
Union (Elbaum 1992).
None of these groups has the strength to affect change of strategic significance, or even to mount an
independent issue campaign, and none are conducting large scale mass organizing on their own
account. Organizations such as the Committees of Correspondence and the New Democratic
Movement, are, however, home to many experienced organizers interested in rethinking the socialist
experience, and may yet become a source for renewal on the left.
The working class, in other words, enters the new conjuncture in an extremely weak position, either
unorganized, or organized under the leadership of clerical, bourgeois, or bureaucratic elements.
C. The Current Political Dynamic
It is not enough to analyze the principal political trends. We need to assess the ways in which these
trends are interacting in the context of the larger political system. Broadly speaking we would like to
suggest that the present period is characterized by
1) a general crisis of the neoliberal-conservative bloc,
2) the emergence of a new progressive-institutionalist ruling bloc, with the new social
movements and the socialists playing the role of "left opposition, and
3) continued disorientation, disorganization and demobilization of the working classes.
The crisis of the neoliberal-conservative bloc is rooted on the one hand in the social crisis
engendered by the penetration of market relations into every sphere of life --which the right has
been unable to resolve through authoritarian measures-- and the economic crisis set in motion by the
inability of the marketplace to centralize the resources necessary for investment in infrastructure,
education, research, and development. The bloc is now entering an advanced state of disintegration.
Those elements committed to an authoritarian solution to the social crisis, together with the most
backward sections of the bourgeoisie and petty bourgeoisie --low wage, low technology elements
committed to continuing to produce in the U.S.-- will break to the right, and provide the social basis
for probable Buchanan and Robertson candidacies in 1996. Those elements of the bourgeoisie
interested in conversion from military to civilian high technology development, together with many
investment bankers, have already broken to the left, and form the core of the new progressive bloc.
This will leave in place a still very powerful core of large commercial banks, multinational
corporations with direct investments in low technology, low wage activities abroad, and high
technology companies committed to preserving as much of the military industrial complex as
possible. This bloc will continue to exercise influence over new petty bourgeois elements attached
to the military industrial complex or enthralled by the neoliberal pro-market ideology, and over the
most backward elements of the remainder of the population, unwilling to pay the taxes necessary to
resolve the country's critical problems.
The new ruling bloc will be led by investment bankers anxious to reduce the deficit and increase the
funds available for investment, together with a growing number of high technology corporations and
forward looking capitalists from the less developed areas of the country committed to investment in
infrastructure, education, research, and development. Institutionalist elements will play a
subordinate role in the bloc, much as the religious right did in relation to the neoliberals. The new
bloc will exercise broad leadership over the social development bureaucracy, elements of the petty
bourgeoisie, and most of the working class on the basis of its commitment to the development of
human social capacities.
The working class itself, however, will continue to remain largely unorganized and unmobilized, or
else under the hegemony of other social forces. Institutionalist elements will tend to replace the
consumerist trade unions as the principal vehicle of ruling class hegemony. "Green," cultural
nationalist, and residual socialist elements will exercise modest influence, but not on a scale to
significantly affect the political dynamics of the country.
Clinton's victory in the election will create a fundamental shift in the political climate. On the one
hand, partly because these sectors really do see the need for change, and partly because of their
need to preserve and deepen their hegemony over the working class and the bureaucracy, we can
expect to see a dramatic shift in the main thrust of public policy and the tone and direction of public
discourse. The neoliberal emphasis on tax cuts and reduction in state expenditures and regulations
will be replaced by a new emphasis on the use of state mechanisms to centralize resources necessary
for investment in infrastructure, education, research, and development, and on the use of state
regulations to force modernization of key sectors of the economy. The rhetoric of free trade and
free markets will give way to the language of strategic trade and social markets. The emphasis on
self-reliance will give way to a more nuanced ethic of responsibility to and for the community.
This will create a fundamentally new opportunity for progressive forces. For the past twelve years,
progressive forces have been on the defensive, and the losing character of most of our defensive
struggles has weakened our organizations tremendously. Now, for the first time in more than a
decade, we will be in a position to fight and win battles, and to begin to rebuild our organizations.
And we will be in a position to rebuild our relationships with center forces on a new basis which
permits us to exercise real leadership.
At the same time, we should not expect initiatives of anything like the depth and scope necessary to
come to terms with the crisis of the ecosystem and the disintegration of the social fabric, or to set in
motion a new period of dynamic growth and social development. The balance of forces within the
emerging Democratic coalition is such that the interests of investment bankers and advanced
industrial capitalists will far outweigh those of workers and bureaucrats. The Republican
governments of the past twelve years were nothing if not successful in systematically destroying the
international workers movement. On the one hand, the already weak and politically underdeveloped
U.S. workers movement has been more or less successfully isolated as a "special interest" defending
the consumer interests of a narrow sector of the U.S. working class, based largely in aging low and
intermediate technology industries. The only growing form of working class organization during the
past decade has been the congregation-based community organization, which organizes workers on
the basis of religion, rather than class, and which are under the control of the Roman Catholic
hierarchy and the advanced industrial bourgeoisie. On the other hand, the crisis of the Soviet bloc
and its allies in the national liberation movements, coupled with China's decision, made more than
15 years ago, to pursue a strategic alliance with the United States, has left North American workers
with no powerful international allies. The communist movement in the United States, which always
functioned more as a (very ineffective) political arm of international socialism than as an organizer
of the U.S. working class, has collapsed along with its international sponsors. Workers in the
United States are largely unorganized as workers. The international workers movement as we have
known it during the course of the past 150 years is dead. Its theory is discredited, its organizations
are disintegrating, and it lacks a credible strategic perspective for the coming period.
The new Democratic administration is likely to take a harder line with regard to China, than the
dominant Sinophile elements in the old Republican government. We should remember that powerful
elements in the new Democratic bloc were attracted to Perot's authoritarian populism and that they
may opt for a more vigorous version of that strategy should Clinton prove unable to effect authentic
restructuring. Organizations such as the Industrial Areas Foundation, which mobilize workers under
the leadership of the clergy and the advanced industrial bourgeoisie are likely to be favored as a
bulwark against renewed working class militance.
We face, in effect, the challenge of rebuilding the movement from the ground up.
REFERENCES
Barrow, John and Tipler, Frank
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Bellah, Robert
1985 Habits of the Heart. New York: Harper
1991 The Good Society. New York: Knopf
Davis, Mike
1986 Prisoners of the America Dream. London: Verso
Durkheim, Emile
1897 Suicide. New York: Free Press
Elbaum, Max
1992 "What's Left?" in The Guardian 44:34
Ferguson, Thomas
1992a "Who Bought Your Candidate and Why?" in The Nation, April 6/13 1992
1992b "The Lost Crusade of Ross Perot?" in The Nation, August 17/24, 1992
Fromm, Erich
1941 Escape from Freedom. New York: Holt, Rinehart, and Winston
Galbraith. James
1990 Balancing Acts.
Gorbochov, Mihail
1987 Perestroika
Hayek, Frederick
1973 Law, Legislation, and Liberty. Chicago: University of Chicago Press
1988 The Fatal Conceit. Chicago: University of Chicago Press
Howe, Daniel Walker
1979 The Political Culture of the American Whigs. Chicago: University of Chicago Press
Industrial Areas Foundation
1990 Fifty Years of Organizing.
Lasch, Christopher
1979 The Culture of Narcissism. New York: Norton
1990 The True and Only Heaven: Progress and its Critics. New York: Norton
Lenin, V.I.
1916/1971 Imperialism, in Selected Works. New York: International
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von Balthasar, Hans Urs
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SONGS OF STRUGGLE
On the following pages we present a few poems and songs from the international workers
movement. The following song is from Korea. It was sung by political prisoners during the
resistance to Japan as they were led away to the hill of Ariran to be executed.
Ariran
Ariran, Ariran, Arario
We are crossing over the last hill.
Oh my countrymen why are, your voices hushed
when the springs and streams are running free:
Ariran, Ariran, Arario
We are crossing over the last hill.
Countless the stars blinking in the night
countless the sorrows we know in our lives.
The following song is from Italy. It is a song of the antifascist resistance.
Partisan Song
High in the mountains,
in the heart of the Alps
Let the Nazi come
---if he dares.
And if any one lets him pass
Our partisans will know how to deal with them.
Where the battle is most bitter
Hand to hand, body to body
We will show them that we are partisans.
We restore the honor of our nation.
This song is originally from Poland. It was one of the most popular songs of the workers
movement during the early part of this century.
Whirlwinds of Danger
Whirlwinds of danger are raging around us
O'erwhelming forces of darkness assail.
Still in the night see advancing before us
Red flag of liberty that yet shall prevail.
(Chorus)
So forward you workers, freedom awaits you
O'er all the world on the land and the sea.
On with the fight for the cause of humanity.
March, march your workers and the world shall be free.
Sisters and brothers in hunger are calling,
Shall we be silent to their sorrow and woe?
While in the fight see our comrades are falling,
Up then united and conquer the foe!
(Chorus)
Off with the crowns of the tyrants of favor,
Down in the dust with the prince and the peer,
Strike off your chains sons and daughters of labor,
Wake all humanity for victory is near!
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