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 Benjamin Barber on ‘Supercapitalism’Posted on Dec 13, 2007
According to Bill Clinton’s own labor secretary, his administration was “one of the most pro-business administrations in American history.” That labor secretary was Robert Reich, an old friend of the Clintons who was too controversial and radical a critic of business to be very influential in Clinton’s two-term presidency, dominated as it was by the Democratic Leadership Council, Robert Rubin, Lawrence Summers and other business luminaries. Clinton’s presidency embraced market capitalism so ardently that “market democracy” became a synonym for the administration’s stance on big business. The book Reich wrote about his experience as labor secretary with the telling title “Locked in the Cabinet” displayed more spleen than political savvy, but it was a revealing and acute exposition of how much less progressive the administration was in its policies and practices than in its rhetoric.
Supercapitalism: The Transformation of Business, Democracy, and Everyday Life
By Robert B. Reich Knopf, 288 pages
Today, back in the more comfortable setting of academia (and having moved to UC Berkeley from Brandeis), Reich has reconsidered the relationship between government and the market and produced a new book, called “Supercapitalism: The Transformation of Business, Democracy and Everyday Life.” It too is controversial and radical, but Reich has evolved and the new work’s radicalism lies in its tolerant recognition of capitalism’s essential nature as a system driven by the interests of shareholders and thus by profit; and hence in Reich’s insistence on the civic limits of “corporate responsibility” and on the inadequacy of civil society and private-sector reform as surrogates for government regulation and oversight. “Supercapitalism” may have more impact than Reich’s earlier, more conventional anti-business perspective because in it he cedes to the market its “natural” and necessary selfishness, and expects democracy rather than capitalism to do the actual work of providing equality and ensuring social justice. By recognizing the entailments of capitalism in its new hyper-competitive global form (hence the somewhat overheated term supercapitalism), Reich builds a case for democracy on premises that traditional market liberals and neoliberals can accept. Robert Rubin would not make the argument quite the way Reich does, but he might well accept it. A Financial Times review by Clive Crook grudgingly allows as how “much of what Reich now says is even correct.” Reich’s argument unfolds as an intriguing story about capitalism’s modern history. He first describes an earlier “Not Quite Golden Age” of capitalism where ostensible competition within national states was trumped by the reality of monopoly. Think Standard Oil or Bethlehem Steel. In that earlier age of cartels, Reich argues, government played the corrective role of trust buster and fairness guarantor. For capitalist competition to flourish, the democratic oversight of a judicious umpire state was required. According to Reich, this earlier stage of capitalism gave way to a second stage in which globalization opened up markets and forged a new and ferocious competitiveness that made monopoly less feasible, and forced would-be corporate monopolists to seek the assistance of government in securing their privileged positions. Superheated and hyper-competitive, capitalism emerged in the new global marketplace as supercapitalism: “The central institutions of democratic capitalism in the Not Quite Golden Age—big oligopolisitic companies, big labor unions organized by industry, and government representing communities and local interests through regulatory agencies—came undone. ... Power shifted to consumers and investors. Supercapitalism replaced democratic capitalism.” Key to these changes was a new privatized role for government. Rather than acting as a tool of the common good imposing public interests on private-market outcomes (mandating real competition, creating social safety nets), government became a tool of private interests hoping to repress or circumvent market competition. Companies that once resisted all government intervention now jockeyed for position to assure that it would favor their interests rather than those of their competitors. To take a recent example: Netscape was glad to see the Justice Department go after Microsoft not because it was interested in fairness but because it didn’t want to be pushed out of business by Microsoft’s software and hardware bundling practices. The massive role of lobbying today, along with the corrosive role of ex-members of Congress as lobbyists, signals this new inverted relationship between government and the market. You may have thought that the effort to secure a legislative ban on offshore oil drilling in California was the work of public-interest environmentalists. Certainly environmental groups supported the proposed ban while the oil industry opposed it, but, writes Reich, “their views did not carry much weight.” The crucial opposition to the oil industry came from a rival private-market sector, the tourist industry, whose aim was to limit drilling to sites that would not adversely affect tourism. Similarly, in October 2006 when Congress passed legislation barring credit card payments for Internet gambling, the real lobby at work was not citizens against sin but the real-world casino industry, which didn’t want virtual casinos competing with them on the Internet. Again and again, battles which under the rules of traditional democratic capitalism might have been contests between public and private interests turn out under supercapitalism to “boil down to a competitive contest between companies that would be affected differently by whatever rules emerged” from government intercession. Hence the remarkable power of the new lobbying industry, constituted largely by retirees from the executive and legislative branches of government—by women and men able to use their access to the commonwealth to pursue the interests of private wealth. Reich reminds us that “upon leaving office, more than half of the senior officials of the Clinton administration became corporate lobbyists.” And whereas in 1970 only 3 percent of retiring members of Congress became lobbyists, 35 years later 30 percent were doing so. It is not hard to see how under these conditions democracy is “overwhelmed” and politics is “diverted” from the public to the private sector. Today firms are urged to pursue corporate responsibility and consumers are pushed to use their private spending (or withhold spending) to underwrite public purposes. In something of a surprise, Reich embraces the late Milton Friedman’s argument that “the business of business is to make a profit, not to engage in socially beneficial acts.” Friedman’s point, writes Reich approvingly, is that companies “should not seek to accomplish social ends because companies are not the appropriate vehicles for social benevolence.” Consumers may like the idea of social responsibility but, Reich observes, are unwilling to pay for it. They may regret trade with countries whose human-rights records are dubious, like China’s, and they may criticize companies whose labor practices are less than savory, like Wal-Mart’s, but they will nonetheless purchase China’s and Wal-Mart’s cheap goods. Thus, argues Reich, we cannot and should not rely on producers or consumers to create the public goods and public regulations that are the provenance of democratic institutions. That is the task of citizens and must be done by them.
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By DennisD, December 22, 2007 at 7:21 am # #120106 by GW=MCHammered on 12/13#120106 by GW=MCHammered on 12/13 at 11:11 pm You nailed it GW. It’s called “Supercrapitalism”. “Today, back in the more comfortable setting of academia” - says it all - academia is about as far removed from reality as you can get.
By I.M. numbnuts re:JBorowski, December 19, 2007 at 8:17 pm # Adm-may have double-posted--problems lately #120593 by John Borowski on 12/16 at 11:39 am John--I’ve got to disagree with you and Pres.Eisenhower and probably everyone else on this site. All overt abuses of power are backed up by threat of physical violence. This can, for sure, include things like the dumping of disease-inducing chemicals in one’s town but the delivery system for the violence is a constant: weak-willed people who carry out unjust orders. Without their “enforcers,” centers of power are helpless. We and our kids, I’m afraid, are the enemy.
By John Borowski, December 19, 2007 at 11:02 am # Bobadi I think you are thinking of Western Europe. The British and Americans were alarmed by the discontent of the people and because so many were joining the Communist Party. The British and American governments came up with a plan they called the Marshall Plan to head off the intrusion by the Communist Party. Whenever the people are homeless, jobless, and foodless they usually turn to Communism. This was also a concern in the US during the depression in the 1930s when Communism gained its greatest advance in this country. The Marshall Plan spent thirteen billion dollars (In the forties thirteen billion was a phenomenal amount) to help restore Western Europe back to normalcy. Starting in July 1947 and ending in 1951 it restored the countries except for Germany back to prewar level. Oddly enough they offered the Soviet Union aid with strings attached, but the Soviet Union said NYET.
By Bobadi, December 19, 2007 at 9:42 am # John, (Borowski) I don’t think we have anything to argue about here.
By Bobadi, December 19, 2007 at 9:21 am # John, (Borowski) I don’t think we have anything to argue about here.
By John Borowski, December 18, 2007 at 12:44 pm # So as not to get the currency traders in a panic, it is ONE DOLLAR for one hundred yen.
By John Borowski, December 18, 2007 at 11:58 am # Bobadi are you aware what it means to have to sell your soul to the British and American countries? They don’t have to entice the Japanese, they command them. Do you know that the Japanese Constitution is written in English not in Japanese? Do you know that the composers of the Japanese Constitution were General Macarthur and some covert help from the British? Do you know that the banks have big English letters and below smaller Japanese letters on their buildings? Do you know that the American arm forces are still over in Japan? Do you know the cost of having the American troops over there is paid for by the Japanese? Do you know that if a Japanese man offered me one hundred yen (The Japanese version of our dollar) for my penny he would be making a profit on me? Do you know if I buy a Japanese Echo or Yaris for fourteen thousand dollars (I’m not a fantasy woods driver, a fantasy sex idol driver, a fantasy ego driver, or a fantasy race car driver) the money I gave them doesn’t go to Japan? It first goes to an American bank and then to US Treasury bonds etc. Do you know that many public places in Japan have emergency exit signs in English not Japanese? Do you know that there are a myriad of things that indicate Japan is about as close to being a colony as a country can get? (Too numerous to mention here)
By John Borowski, December 18, 2007 at 6:09 am # When 6 traitors over-threw theWhen 6 traitors over-threw the Soviet Union no one, not even the venerable New York Times (The British flag ship) reported the over-throw. It is analogous to the sky falling down and not one of the media reports it. So too the over-throw of the US by the military and industrial complexes with help from their lackeys the Republicans (Aka Conservatives right wingers) was not reported by any of the media. It is sad to see that most Americans still believe they can vote out the Republicans (Aka Conservatives right wingers) and get rid of their cohorts the military and industrial complexes. They actually believe they can get their beloved country back. (They can’t) The game plan by these evils is to create a world dictatorship and call it “freedom democracy globalization”. The US overthrow is interesting because unlike the Soviet Union (Which was perpetrated spontaneously) the US overthrow was done in slow motion through the years by the British, Nixon, Reagan, and the two Bush. If the American people took action when warned of the overthrow by Eisenhower in the early sixties we could have circumvented their game plan. Now it is too little, too late. The Democrats facing the god-like power of this troika was like a flea challenging an evil elephant to a tug of war. (The Kennedys tried it and look where it got them) There is a law of fate (That can’t be violated) that tells us absolute wealth and absolute power will corrupt absolutely.
By Bobadi, December 16, 2007 at 1:06 pm # John Borowski said: "Years ago theJohn Borowski said: From my reading of Chalmers Johnson; Japan was propped up by the US to con other nations (notable communist) to adopt our Capitalist system rather then anything resembling socialism. A come-on that has apparently worked, as shown by capitalism’s advance to Russia and China.
By John Borowski, December 16, 2007 at 11:39 am # After World War 2 theAfter World War 2 the US was the only major industrial power that wasn’t devastated. As a consequence, industry in this country had business with little or no competition. It took the other industrial powers about twenty years to get back in the game. Similar to 9/11, Churchill came over to this country and scared the crap out of us by referring to the Iron Curtain. This scare gave the military a blank check to spend as they pleased. The results of this were the industrial and military complexes became five hundred pound gorillas. President Eisenhower was alarmed by this and he warned the American people that this country had a muddy road ahead. Unfortunately, it fell on deaf ears. Like the king of England, the president of our country is just a figure-head. The all powerful industrial and military complex runs things.
By John Borowski, December 16, 2007 at 5:03 am # Years ago the media toldYears ago the media told us that we would be second-rate to Japan eventually. Japan had to sell their souls to the victor as a requirement of unconditional surrender. Their post- war success was accomplished by large Western World companies feeding on the qualities of the Japanese people. When China offered vast amount of cheap labor the robber barons took down their tents in Japan and moved to China. As a result of this action Japan is now an economic basket case. One would wonder why China a communist nation would be in bed with Capitalist countries. China knows that they are not at the level of technology that the Capitalist world is. The tortoise knows, they can catch up to the hare in technology if they allow the capitalist to do their “technology stuff” in their country. In the old days the country that had cannon always defeated the country that had spears. Today, the country that has technology will defeat the country that has infantry. Globalization can only work if you have one world government. There never will be two types of political systems living symbiotically in globalization.
By John Borowski, December 15, 2007 at 7:04 am # To Expat: After the "FreeTo Expat: After the “Free World” found six traitors to overthrow the Soviet Union by putting a billion dollars in each traitor’s pocket, the rape of the vast wealth of the country’s resources began. To the robber barons’ surprise, there was even greater wealth in the highly intelligent, trained, and educated people to exploit. This human wealth was by far even greater than the resources in that country. In China there exists the same highly intelligent, trained, and educated “gold mine” of people to exploit. (The robber barons are searching for 6 Chinese traitors currently) It is worth participating in a web site when you find people like Expat on it. I agree with everything Expat writes except for Africa. This continent has always been ripe for the raping by the robber barons except for one important factor. Because they were dominated by the British and European robber barons for centuries (The robber barons had cannon and the natives only had spears) it benefited them to keep the people in those countries uneducated and exploit their resources. As a result the people were not trained or educated like those in the Soviet Union or China. The qualities of the Africans are equal to any other country in this sad world. The problem in Africa is it would take many, many years to upgrade most of the people there because of the scourge of colonialism. Even though most countries are supposedly free, they are run by lackeys for the British and European powers. Those countries that are determined to be sovereign are blacklisted economically.
By John Borowski, December 14, 2007 at 10:46 am # Bush and his right wingBush and his right wing cabal (Aka Republican Conservatives) are determined to give the five percent of the super rich ninety percent of the wealth of this country. If you are a John Doe type and are willing to vote Republican, in my opinion your are an A--H--- because your ignorance is screwing ninety five percent of the American people and your own family. The only remaining party is the Democrats. The British will not allow the Democrats to win the elections unless they are seventy five percent for the super rich.
By terry jeffers, December 14, 2007 at 10:41 am # Mr. Barber and Mr. ReichMr. Barber and Mr. Reich are talking about the problem very well. A big part of the solution, it seems to me, is campaign finance reform. Part of that is a legislative solution to cease defining a corporation as a “person.” If a corporation is no longer defined as a person, its speech can be regulated. If we could keep corporate money, all of it, out of elections, and limit the amount that corporations may spend on lobbyists, it would go some of the way towards solving the problem. Then the government might have some breathing room to work on the underlying problems of citizens and would-be citizens: our bad-and- getting-worse level of education, and the other problems identified by Mssrs. Barber and Reich.
By GW=MCHammered, December 14, 2007 at 9:29 am # Robert Reich also says, "SocietiesRobert Reich also says, “Societies are fragile things, they’re based on trust. If people don’t feel that they have a fair chance of getting ahead, a lot of people feel excluded. That’s not good for society. That doesn’t keep America together.” Perhaps his book more accurately should be titled ‘ZüperKapitalizm’. The End of Globalization? “Contemporary America’s biggest export now appears to be the well-paid jobs of its middle class. The trend that began with blue-collar workers and has expanded to software engineers will hit investment bankers and pharmaceutical researchers next, says Alan Blinder, a professor at Princeton University and a former deputy chairman of the US Federal Reserve Bank. According to Blinder, up to 40 million American jobs—representing twice as many people as are currently working in the US industrial sector today—could face the threat of outsourcing.” http://www.spiegel.de/international/world/0,1518,52262 8,00.html
By GW=MCHammered, December 13, 2007 at 11:11 pm # "The struggle for democratic sovereignty“The struggle for democratic sovereignty remains the common struggle.” Are you kidding us? Open borders. Illegal immigration run amok. Financing our government to communist countries. Selling US assets, even freeways, to foreign entities. We auction sovereignty to the lowest bidder. Now, where’s the graph that shows the consumer Their Spending vs China’s Military Growth? Might be a factor someday soon, ya think? Where’s the chart showing the Decline of Earnings vs Skyrocketing Retail Prices vs the Pyrotechnic Cost of Education and Healthcare? How about a concise explanation of that one, eh? Oh, and where on earth is the M1, M2 AND M3?! Just want to teach my kids something about what sovereignty used to mean vs what it means today. Add Your Comment |
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