Meet the New Boss, Worse Than the Old Boss

Here's a review I just posted on Amazon. The paragraphs in bold type at the bottom were not included in the Amazon review because of the 1,000 word limit there.

Mysteries of Corporate Mayhem Revealed!
November 26, 2006

Richard Sennett, in THE CULTURE OF THE NEW CAPITALISM reflects upon the reactionary extirpation over the past three decades of the Western social capitalist state. Starting with a discussion of Bismarckian social capitalism which was founded on the model of the Prussian Army's highly successful bureaucracy and which provided structure and discipline to cultural relations, Sennett ends with a bleak meditation on the values encoded in the New Economy versus the Old. These include the elevation of process over craftsmanship, of "flexibility" over stability, of superficial over deep knowledge, and of centralized power over mediated authority. Along the way, Sennett shares pithy insights into the nature of this revolutionary shift and the cultural and economic dislocations it has caused.

Sennett states that three new pages were turned in the late twentieth century workplace. "First has been the shift from managerial to shareholder power in large companies." (pg. 37) This shift in power, according to Sennett turned a second new page: "The empowered investors wanted short-term rather than long-term results." The third new page representing a challenge to the past "lay in the development of new technologies of communication and manufacturing." He notes that "one consequence of the information revolution has...been to replace modulation and interpretation of commands by a new kind of centralization." (pg. 43) At the same time, automation, growing out of technological innovation "...has affected the [social capitalist] bureaucratic pyramid in one profound way: the base of the pyramid no longer needs to be big." (pg. 43). Circuits replace people.

According to Sennett, the old model, built on the pyramid model with a mass of workers at the bottom responding to a chain of command situated at the top is on the way out. In contrast, the new model he likens to an MP3 player: "The MP3 machine can be programmed to play only a few bands from its repertoire; similarly, the flexible organization can select and perform only a few of its many possible functions at any given time. In the old-style corporation, by contrast, production occurs via a fixed set of acts; the links in the chain are set. Again in an MP3 player, what you hear can be programmed in any sequence. In a flexible organization, the sequence of production can be varied at will." (pgs.47-48). (Notably, and perhaps inevitably, the new model got its start in the cutting edge businesses of finance, technology, pharma and media and their support industries: marketing research, advertising, and business consulting).

In a remarkable section on the shift in how employees are assessed - based on achievement in the old structure and "potential" in the new -- he shows how SAT testing supports the new regime. Sennett notes that "in the search to consummate the project of finding a [Jeffersonian] natural aristocracy, the mental life of human beings has assumed a surface and narrowed form. Social reference, sensate reasoning, and emotional understanding have been excluded from that search, just as have belief and truth. ...These [flexible] institutions ... privilege the kind of mental life embodied by consultants, moving from scene to scene, problem to problem, team to team. He says that "...this talent search cuts reference to experience and the chains of circumstance, eschews sensate impressions, divides analyzing from believing, ignores the glue of emotional attachment, penalizes digging deep--the state of living in pure process which the philosopher Zygmunt Bauman calls 'liquid modernity.'" (pgs. 120-122)

He notes that while citizen-workers might have been trapped in Max Weber's "iron cage" under the old system, nevertheless the structure gave its denizens a sense of meaning and was roughly consonant with general social values. In essence, Sennett says: "Time lay at the center of this military, social capitalism: long-term and incremental and above all predictable time." (pg. 23).

This new architecture, crafted by the business consultant class to whom agency is given by the new corporation, enables the exercise of enormous centralized power through new communications technology, and at the same time evades the responsibility of its recommendations, as do those who hire them. Bloodless terms like "flexible" workplaces," "off-shoring" and "right-shoring," "downsizing" and "right-sizing" are, for instance, deployed to mystify mass firings and those responsible for them.

The ideal worker in this paradigm is conceived to be flexible, cooperative, efficient and not get too involved in the nuts and bolts when doing problem-solving. Want ads looking for "entrepreneurs," and "self-starters" are emblematic of this shift. The ideal worker is most of all attuned to short-term shareholder values, values which insist on change. Whether the change is good or bad is almost irrelevant: change is in and of itself a signal to investors of impending short-term gains.

Sennett offers "five ways in which the consumer-spectator-citizen is turned away from progressive politics," each element of which arises from the culture of the new capitalism. He says that the consumer-spectator-citizen is "(1) offered political platforms which resemble product platforms and (2) gold-plated difference; (3) asked to discount 'the twisted timber of humanity' (as Immanuel Kant called us), and (4) credit more user-friendly politics; (5) accept continually new political products on offer."(pg. 163). Summarizing these points, he says: "The culture of the new capitalism is attuned to singular events, one-off transactions, interventions; to progress, a polity needs to draw on sustained relationships and accumulate experience. In short, the unprogressive drift of the new culture lies in its shaping of time." (pg. 178).

In his last paragraph, Sennett attempts to end on a hopeful note: "What I have sought to explore in these pages is thus a paradox: a new order of power gained through and ever more superficial culture. Since people can anchor themselves in life only by trying to do something well for its own sake, the triumph of superficiality at work, in schools, and in politics seems to me fragile. Perhaps indeed, revolt against this enfeebled culture will constitute our next fresh page."

I don't know about you, but I'm not holding my breath.

Sennett offers as the historical turning point from the old pyramid to the unraveling of the Bretton Woods agreement in the oil crisis of 1973. This rupture caused the weakening of national constraints on investing. Wealth, suddenly liberated, was available for investment, and began chasing after short-term profits where once it had been satisfied with long-term dividends. The post-war consensus, that social compact which attempted to regulate business, government and labor, slowly came apart.

Notably, the unraveling of Bretton Woods happened at the same time that the U.S. and Soviet governments put aside their inflammatory anti-communist and anti-capitalistic rhetoric and sought to demonstrate to their unruly citizens and client states that as nations they could and would work together in peaceful coexistence. Jeremi Suri, in POWER AND PROTEST: GLOBAL REVOLUTION AND THE RISE OF DETENTE, suggests citizens had become unruly because of their leaders' charismatic rhetoric in the early 60s -- the "New Frontier," the "Great Society," "Communist Construction (and DeStalinization)" – a rhetoric of rising expectations that promised more prosperous, more egalitarian societies. But when these promises could not be kept, the U.S. and Soviet Union found it useful to engage in an era of détente, the strength of which "…derived from the fact that it addressed the fears and served the interest of the leaders in the largest states."

Doug Henwood in AFTER THE NEW ECONOMY, notes that it was at this same time that the conservative movement in the United States, which had been mostly quiescent in the 50s and 60s, gained a new counter-
revolutionary impetus as the ruling class, the top 1% which had traditionally controlled about 40% of the wealth in the United States, found their share reduced to approximately 20% in the early 70s. (Pg. 121). It was then that The Chicago School economists, led by Milton Friedman, sharpened their neo-liberal apologia for anti-Keynesian capitalism. Their theories were embraced by the denizens of the Business Roundtable, their friends in the Treasury Department and the White House. Eventually, in Henwood's words, "...through benefit cutbacks by employers, outsourcing, speedup, permanent downsizing, cutbacks in regulation, the central-bank-led class war succeeded in more than doubling the profit rate for non-financial corporations between 1982 and 1997" (pg. 210).

Also at this same time (1971) future Supreme Court Justice Lewis Powell wrote a memo for the U.S. Chamber of Commerce entitled "Attack on American Free Enterprise System" that warned of an assault by environmentalists, consumer activists, and others who "propagandize against the system, seeking insidiously and constantly to sabotage it." The memo called for an organized effort by a powerful coalition of business groups and ideologically compatible foundations to align the U.S. political and legal system with their own vision. To see that this reactionary memo did in fact call forth the very forces that Powell sought to conjure, one has to look no further than the rise of K Street lobbyist and right-wing think tank in Washington, D.C.

And so we find a remarkable similarity in the goals of business and government during this pivotal time. All were reactionary attempts to tamp down the insurrection by citizen-workers as well as unruly client states and non-aligned and third-world countries.

At the same time in a feat of singular cynicism, as Thomas Frank (in THE CONQUEST OF COOL and ONE MARKET UNDER GOD) notes that while business which becoming more regressive in the 1970s, business also began to sell soft-core versions of revolution to world consumers: revolution by Nehru jacket, by suits with bell-bottom trousers, by VW bug, by blow-dryer and ever more outrageous entertainments. Then, in the 80s during the Reagan revolution, business took an even more amazing liberty: it began to position itself as promoters of Populism, Progressivism, and personal freedom. Business began to advertise itself as the vanguard of a revolutionary movement, a movement in which the magical workings of the market would smooth the way for a new birth of personal freedom and human dignity in the U.S.A., and throughout the world.

Frank notes that this fake populist "revolution" continued in the 90s when Americans were told that average working stiff could easily become the "millionaire next door," and further, that the average guy was much better off owning stock than relying on his pension or Social Security to see him through his golden years. So pervasive did this free market farrago become in the media, that even now, well after the New Economy bubble has burst, many still hear it as gospel truth, believe that inevitably everything must be privatized for "efficiency's sake." So cunning has the pro-business rhetoric of the corporate state become that the average American blames himself for not being "entrepreneurial" enough, when instead Frank says he should be working to reverse the corporatocracy's 30-year rollback of worker's and citizen's rights.

I couldn't agree more.

One final thought. I was reminded in writing this review of THE CULTURE OF THE NEW CAPITALISM of Rory's Stewart's harrowing chronicle of his walk across Afghanistan, THE PLACES IN BETWEEN. At the end of his walk he makes the observation that the "neo-colonialists" have one plan for every developing country, a plan that is based on a modern "fundamentalism" -- the infallibility of the Free Market. And when this ideology fails, Stewart notes, as it has failed in Afghanistan and elsewhere, the new neo-colonialist administrators pack up their bags and move on to the next international hotspot, touting the same panacea despite its repeated failure to take hold. He observes that this kind of failure would never have been tolerated among earlier colonial empires; that it may be emblematic of America's schizophrenic, impatient, inconsistent brand of imperialism.

Sound familiar?