By William Kay
Defining corporatism is so problematic some recommend retiring the word. The confusion partly results from its having shifted meanings over time. While some trek to antiquity to discover its headwaters; corporatism is clearly of 19th century origin. By the 1880s corporatism was an organized, self-conscious ideological movement much like its rivals: liberalism and socialism. However, the utopian fantasies of the early corporatists are barely discernable in corporatism’s 20th century manifestations.
Regimes now generally accepted as having been corporatist include:
Mussolini’s National Corporatism (Italy, 1922-45);
Primo de Rivera’s Country-Religion-Monarchy (Spain, 1923-30);
Salazar’s New Deal (Portugal, 1932-68);
Hitler’s National Socialism (Germany, 1933-45);
Vargas’s New State (Brazil, 1933-45);
Roosevelt’s New Deal (USA, 1933-45);
Franco’s National Syndicalism (Spain, 1936-73);
Metaxas’s Third Hellenic Civilization (Greece, 1936-41);
Peron’s Justice Party (Argentina, 1943-55). (1)
The connection to fascism is obvious. The labels"Syndicalism" and "Socialism" should be red-flagged because from its inception corporatism appropriated leftist lingo while simultaneously exerting lethal opposition to the Left. The label "New" is equally misleading as corporatists were actually systematizing reactionaries bent on preserving the privileges and fortunes of the oldest aristocratic, monarchical and clerical institutions. The starting dates are instructive because, as one renowned authority has noted:
"In fact, throughout Europe as well as Latin America, corporatism was extremely popular as an ideology during the 1920s, 1930s, and early 1940s (before the end of World War II). Hundreds and even thousands of books, articles and news stories were written about it." (2)
After WWII corporatism vanished from printing presses and political speeches. Corporatism then surged back in the 1970s with many professors extoling it as the superior socio-economic pathway. By the 1990s it had fallen again. Today no one boasts about being a corporatist. The word survives only as an insult.
Corporatists promote the privately-owned yet state-planned economy. They champion bureaucratic associations representing all firms within, and all practitioners of, the various industries and professions. These mega-associations (a.k.a. the corporations) would collude with state officials but remain self-governing as regards determining quotas and pay-scales etc. The free market would disappear as would independent labor unions. Ultimately, a grand council of corporations would replace elected legislatures.
Across the world, in varying degrees, we now find:
a) powerful self-governing medical, legal and academic associations;
b) mandatory agricultural marketing boards;
c) oligopolies, with proven lobbying capabilities, dominating key economic sectors; and above them all,
d) unacknowledged land cartels.
Some scholars contend that every country is now, more or less, corporatist in deed, if not in name.
Environmentalism presumes corporatism. These two social movements are historical twins. Moreover, today’s green industries, in true corporatist fashion, consist of vast alliances of privately-owned businesses integrated into, and dependent upon, government ministries. The world’s most corporatist countries are also the most environmentalist.
What follows are four 2,500-word vignettes which may shed light on the meaning of corporatism.
Table of Contents
As the medieval order coalesced haphazardly across Europe kings and emperors began their respiteless melee with subject and neighbor alike. Monarchs personally owned vast agricultural properties and viewed themselves as representing all landlords within their domains. Nobles, citizens whom monarchs inducted into the political class, channelled their activism through crown-sanctioned aristocratic, merchant and artisanal estates. The toiling masses were forcibly evicted from politics.
Corporations consisted of crown-sanctioned: municipalities, universities, guilds, monasteries and military orders. The term derives from the Latin "corpus" meaning "body" and translates to "organization" – specifically to function-specific, state-chartered organizations.
Until the 1500s Western Europe had one religion, Catholicism. Popes ruled as monarchs over central Italy, including Rome, while the Church’s private landholdings covered a third of Western Europe.
The long century running from Henry VIII’s founding of the Anglican Church in 1534 (and his subsequent sale of Catholic Church properties) to the end of the catastrophic transcontinental Thirty Years War (1648) drew the curtain on the Middle Ages. The Thirty Years War divided Europe south from north; Catholic from Protestant. In addition to the rise of independent Protestant states across northwestern Europe this century witnessed: a) the proliferation of printing presses; b) the growth of capitalism, colonialism and world trade; and c) the development of quasi-republican, quasi-democratic regimes.
Key to the latter development were the English Civil War (1640-51) which reduced the King’s power and strengthened the House of Commons; and the protracted Dutch War of Independence from Spain (1568-1648) which also ushered in republican, capitalist structures. Southern (Catholic) Europe and eastern (Orthodox) Europe remained unsullied by such profanities.
The next shock to the residual medieval order came in 1791 when France’s revolutionary government abolished guilds and corporate privileges. Over the next decades several countries followed suit. Groups harmed by these changes did not merely lament the passing of their privileges; they resisted fiercely.
The long century running from the Napoleonic Wars (1803-1815) to World War One (1914-8) beheld a relentless march toward parliamentary supremacy and universal voting rights. Still by 1850 in Norway, then Europe’s most democratic country, only 8% of the population had voting rights. At this time only 4% of Brits were enfranchised. In France only the richest 0.5% voted. In much of Europe there were no elections, no constitutions.
After 1850 as voting rights expanded so did gerrymandering, corruption, intimidation, and the use of multi-tier voting systems aimed at thwarting democracy. Fraud was endemic. In one late 19th century Spanish election results were leaked before the polls opened. Moreover, monarchs often ignored elections and dismissed legislatures. In the words of Austro-Hungarian Emperor Francis I (1792-1835):
"I have my estates and if they go too far I snap my fingers and send them home." (1)
Politicians crowed about their life-long efforts to suppress democracy. Potentates positively delighted in denying fundamental justice to the lower classes. Political dissidents faced public torture and/or execution. Duke Charles III of Parma (1849-54) personally carried out public canings for crimes as slight as failing to remove one’s hat in his presence.
Political exclusion facilitates economic privation. Before 1850 life expectancy for Europeans hovered around 35 years. A third of Europeans subsisted on starvation’s brink. 20% of children born alive did not see their first birthday and 20% of those that did never saw their twentieth. One in seven women died giving birth. (2) This hardly mattered to the likes of Count Arakchevyev, one of Czar Alexander’s top generals, who demanded all serf women attached to his property bear one child a year.
Over much of Eastern Europe a serfdom akin to slavery lasted until the 1860s. There, as in eastern Prussia and the Hapsburg Empire, the nobility owned all the land. Peasants had rights of use but never ownership and with those rights came onerous obligations.
Prince Paul Esterhazy owned 6.5% of Hungarian land; collecting rents from 700,000 tenant farmers. Serbian Prince Milos Obrenovic’s personal income equalled 15% of Serbian gross income. Milos ruled a land with no doctors, virtually no roads and near universal illiteracy. 5,000 such aristocrats dominated European politics, culture, and economics. (3) Even in Britain these families monopolized cabinet portfolios and top military positions.
Basic rights of freedom of speech, assembly and association were denied. Across Europe, save Britain, censors vetted all newspapers and books before publication. Well into mid-century peaceful political assemblies in Berlin were set upon by sabre-wielding Prussian cavalry. (Detectives then scoured hospitals arresting anyone with sabre wounds.) Europe’s free-speech and pro-democracy campaigners met in secret or cleverly used funerals and banquets as false fronts.
The right to assembly and associate became battle-cries in the critical arena of labour organizing. While Britain legalized unions and strikes in 1824 severe harassment persisted into the 1870s. In 1854 alone 3,000 British strikers were imprisoned for leaving their employment in violation of the Master and Servant Act (of 1351). After this Act lost its criminal teeth it was still used to inflict financial penalties on employees who withdrew labor services. In 1872 alone 10,000 British employees suffered such penalties. Nevertheless, Britain was eons ahead of the continent where acceptance of minimalist worker rights to associate and withdraw labor did not occur until 1870. On the eve of union legalisation in Austria fifteen labour leaders received long prison terms for treason. In the early 20th century union organizing remained a crime in Portugal and Russia. (4)
Corporatism was thus the brain-child of despotic minds from terrible times. Corporatism (a.k.a. distributism) emerged post-Waterloo in that bastion of absolutism, the Hapsburg’s Austro-Hungarian Empire. It sprang from the conservative romantic’s abhorrence of capitalist industrialization. It was the ancient regime’s proud tower hoisting the medieval banners of organic harmony and craftsmen guilds. Early corporatists were Catholic aristocrats to whom the Middle Ages was paradise lost.
Among corporatism’s earliest proponents was Adam Muller (1779-1829), spokesman for Prince Klemens Metternich (1773-1859) – the Hapsburgs’ henchman. The Hapsburgs articulated their pathological resistance progress with their motto: "govern and change nothing." In the 1830s Emperor Francis I rejected plans for railway construction "lest the revolution come into the country." (Conterminously, and for the same reasons, Pope Gregory XVI vetoed railways in the Papal States.)
Beyond its own domains the Austro-Hungarian Empire militarily dominated Italy and southern Germany. Metternich held Prussian Kings and Russian Czars spellbound with his zealous commitment to keeping lower classes down. He sent 50,000 troops to crush a peasant uprising in the Ukraine and he blanketed Italy with his "forest of bayonets" to puncture popular mobilizations.
Within Austria Metternich prevented any expression of dissent through: strict censorship; omniscient secret police; and rigid control over education, assembly and association. Whenever dissent evaded these controls, immediate and violent repression followed. Key to Metternich’s system was a vast network of spies recruited from among domestic servants, prostitutes and waiters. Tourists were warned that talking about politics in a Viennese café could result in spending the night in a Viennese jail.
Metternich’s handiwork temporarily came undone in 1848 when a massive uprising in Vienna called for: a free press, constitutional government and his dismissal. Emperor Ferdinand surprisingly agreed to all demands. News of Metternich’s dismissal unleashed rebellions throughout Europe. The exuberance was short-lived however, as by 1849 order had been restored to Vienna – over the dead bodies of 5,000 Viennese. Twenty-five populist leaders were then executed. Hungarian revolutionaries suffered 150 executions with another 1,500 received long prison terms. Several ladies from Hungarian high society who had supported the protesters were publically whipped. The 1850s proved a reactionary nightmare after the "new enlarged second edition of the Metternich system" came out. (5)
Back in the 1820s Metternich’s philosophe, Adam Muller, sought to rescue traditional institutions by attacking both egalitarianism and laissez faire economics. His proposed "class state" would coordinate production and regulate competing interests through grand organizations each controlling separate economic sectors. This re-hash of feudal guilds and estates pandered to the aristocrat’s aversion to unrestricted capitalism. After a lull following Metternich’s death, Muller’s writings surged in popularity.
Until the 1850s corporatists were uncompromising reactionaries bent on extinguishing capitalism and restoring feudalism. In the 1860s a more practical corporatism developed. As with its arch-rivals, liberalism and socialism, corporatism became both an ideology and a movement. It remained hostile to the revolutionizing dynamism of capitalism and to the new forms of conflict capitalism engendered. Corporatists opposed voting rights for the masses and expressed a lethal hostility toward organized labour. Their rhetoric about class collaboration, and their disdain for class conflict, allowed them to posture as peace-makers… whilst they plotted to restore aristocratic hegemony.
Corporatists were monarchists in whose utopia monarchs would interact, not with a citizenry endowed with equal rights, but with corporate leaders. They sought an alternative to parliamentary democracy weighted heavily toward the landed estate. Important post-1860s corporatists tellingly include: Cardinal Henry Manning (1808-1892), Bishop Wilhelm von Ketteler (1811-1877), Vincenzo Pecci (a.k.a. Pope Leo XIII, 1810-1903), Francois-Rene de La Tour du Pin (1834-1924), and Monsignor Antoine Pottier (1849-1923).
The denunciations of liberalism and socialism in Pope Pius IX’s infamous Syllabus of Errors (1864) addressed a Church reeling from property seizures in Iberia and Latin America at the hands of liberal-republican elites. The Church was also losing its grip on its core holding, the Papal States. (Fifteen years earlier Pius IX oversaw the brutal suppression of the popular, but short-lived, Roman Republic.)
The Church’s counter-attack involved nurturing Political Catholicism; i.e. social movement Catholicism. This stooping to re-conquer took many forms: from antipoverty activism to electoral parties. Political Catholicism marked a departure from their nakedly repressive strategy exemplified by the Centurions – a 40,000-strong pope-worshipping paramilitary who waged a terrorist crusade against Italy’s "thinkers." (6) In the 1870s, after Political Catholicism unveiled "corporativismo" as the cure-all for the social malaise, corporatism morphed into a full-fledged, multi-faceted program coupling utopian economics with grassroots mobilizing.
In the 1860s as Europe’s oligarchs realized brute force alone could not contain dissent they begrudgingly acquiesced to minimal labor and voting reforms. Nowhere did this strategic shift result in the masses gaining real power; nor did it herald an end to wholesale violence. Several subsequent slaughterings of the innocents followed; the most consequential occurring in Paris in 1871.
In 1870 French disasters in the Franco-Prussian War triggered a bloodless insurrection overthrowing Louis Napoleon’s proto-fascist regime. Sans Louis, his former political base triumphed in the subsequent gerrymandered, rural-dominated election. The new pro-monarchist regime, under Adolph Theirs, relocated government headquarters to Versailles and passed laws causing market chaos in Paris.
A second insurrection in Paris in 1871 was legitimated by municipal elections producing a working and middle class government. While lacking a coherent program, the Parisian government was republican, anti-clerical and determined to continue the wartime moratorium on rents.
Prussia aided Theirs’s effort to subdue Paris by releasing tens of thousands of French prisoners of war. After a few weeks of fighting the woefully out-gunned Parisians capitulated. Theirs’s forces suffered 900 combat fatalities. 25,000 Parisians were killed, the vast majority in cold blood. At La Roquette prison 1,900 faced firing squads in two days. A stack of 1,100 corpses graced Place du Trocadero. At the Ecole Polytechnique the stack of corpses measured three yards high and a hundred yards long. The mere possession of army boots, or of a jacket-shoulder possibly discolored from rifle fire, became crimes worthy of summary execution.
A state of siege, denying all basic freedoms, lasted five years. Of the 50,000 arrested 1,200 died in custody, 26 were executed, and 10,000 received long sentences in squalid prisons. So thorough was the culling Paris suffered labour shortages. Half the workers in the shoe industry perished or vanished.
Europe’s press reveled in tales of atrocities committed by the Parisians. In reality, these consisted of 56 hostages being killed and several Parisian landmarks being torched – actions undertaken by a handful of extremists after Theirs’s massacres had begun. Tales of the Parisians’ atrocities were interwoven with references to an international Marxist conspiracy. In fact, the Parisian government was neither Marxist nor controlled by the First International. In the continent-wide clampdown prosecutors depicted the First International as a powerful Marxist shadow government. In fact, the First International began exhibiting Marxist influence only in 1870 and as of 1871 could not scrape together enough funds to rent an office or hire a single staff.
This bias in journalism was mirrored in academia. Monarchs dominated higher education throughout the 19th century. During the reactionary 1850s, the Catholic Church signed numerous concordats with monarchs giving the Church extensive control over higher and lower education. In Prussia a similar clerical domination of schools prevailed. This throne-altar alliance purged hundreds of academics and teachers for political reasons. Hapsburg Emperor Francis I (1768-1835) expressed the dominant view of academic freedom thusly:
"I have no use for scholars, but only for good citizens…Who serves me must teach what I order…"
After Hanover’s King Ernst Augustus (who committed every crime but suicide) fired seven professors for their liberal views, he shrugged off criticism saying:
"Professors and whores can always be had for money." (7)
In the run-up to WWI this throne-altar alliance switched from mere suppression of dissent to proactively broadcasting their opposition to liberalism and democracy through academics like: Gaetano Mosca, Vilfredo Pareto, Robert Michels, Georges Sorel, Ludwig Gumplowicz, Giuseppe Toniolo, Ferdinand Tonnies, Alfredo Rocco, Max Weber and Emile Durkheim (1858-1917). These scholars coined the term "elitism" and they did not use it pejoratively. Neo-feudalism saturated their systematic expositions of corporatism, Christian Democracy and guild socialism. They bemoaned capitalism’s dissolution of sacred communitarian bonds. Neo-feudalism was even more evident in the patronized arts milieu.
The biographical blurbs about the above-mentioned scholars repeat the phrase: "a father of sociology." Indeed, these men laid the cornerstones of sociology especially its structural-functionalist school. Their writings are still required reading. What is conveniently forgotten is that these men were political activists connectable to corporatism (i.e. fascism) by a thousand threads.
Pope Leo XIII, in 1881, summoned a panel of academics to study corporatism. Their 1884 conference in Freiburg, Germany defined corporatism as:
"… (A) system of social organization that has at its base the grouping of men according to the community of their natural interests and social functions, and as true and proper organs of the state they direct and coordinate labor and capital in matters of common interest." (1)
Said "groupings of men" were the "corporations"; i.e. monopolistic, guild-like assemblies that, because they embodied all owners and workers within various industries, would do away with market anarchy and worker-owner conflict. Medieval harmony would be imposed on industrial capitalism.
Harkening back to pre-industrial times was not, yet, wildly idealistic. In most European countries over 50% the workforce remained agricultural; the exception being Britain which was 15% agricultural. Britain was also exceptional for having 40% of its population in cities. In most of Europe urbanization was below 10%. In Austria 7% lived in cities; 65% worked the fields. Village blacksmiths and shoemakers were not, yet, relics. (2)
Corporatists never challenged the private ownership of wealth. Rather, they sought to manage privately-owned economies through some means other than laissez faire liberalism. Here is Williamson on 19th century corporatism:
"While corporatism was an intellectual response to the advent of industrial capitalism in what was held to be liberal politico-economic systems and the writers were often scathing of the impact it had on the proletariat, the theory strongly defended the maintenance of private property as the most desirable form of ownership of the means of production." (3)
Corporatism was not a form of socialism. On the contrary corporatism was a unique political pathway characterised by widespread, sustained attacks on socialism. However, corporatists often masqueraded as leftists; Williamson again:
"…it is often suggested that corporatism is closely associated with forms of socialism, where in fact they were part of different traditions of thought separated by divergent underlying values. A note of caution, however, should be added because certain corporatist writers, like Catholic socialists and monarchical socialists were not adverse to using ‘socialism’ as a flag of convenience." (4)
Clerics, north and south, rightly feared socialists as socialists were even more aggressive about expropriating church lands than were the capitalists. Moreover, socialists tended to be philosophical materialists if not outright atheists.
The Freiburg Conference gave corporatism legitimacy and coherence. A follow-up conference in Berlin in 1890 (later dubbed the Corporatist Internationale) provided additional momentum. The word "corporatism" arrived in English at this time.
In 1891 Leo XIII re-worked the documents generated by these two conferences into his encyclical: Of New Things. In this first Papal blessing of labor unions, Leo fantasized about embracing bosses and workers in familial love. Bosses would show fatherly solicitude toward workers who in return would faithfully perform their duties.
After 1891 Political Catholicism quickened. Catholic labor unions sprouted alongside Catholic youth groups, Catholic business associations, Catholic women’s organizations and Christian Democratic parties. Catholic (corporatist) unions, narrowly focussed on specific crafts, competed directly with socialist unions and other forms of autonomous worker assembly, notably anarcho-syndicalism. Corporatist syndicalism ultimately co-opted and supplanted radical syndicalism. The boards of corporatist unions, as a rule, included employers. Such unions were led by priests and bosses determined to spike working class solidarity and prevent authentic labour organizing.
In southern Germany corporatist Working Men’s Circles date to the 1870s. The national Catholic trade union federation first convened in 1895. By 1910 similar federations appeared in several countries. While explicit "Corporatism" existed in northern Germany, Scandinavia and Holland it never attracted the support that it did in Catholic realms. On the other hand, there was a parallel rise of craft-based, Lutheran-led unions in northern Europe which became the establishment’s preferred alternatives to broad-based socialist unions.
Also emerging across northern Europe at this time was a mode of governance featuring the essential corporatist trait: the centrally-planned but privately-owned economy. This non-idealistic corporatism, which lacked any façade of worker input, was strongest in Germany where industry from its inception was subsidized and cartelized. To compliment this industrial strategy Chancellor Bismarck pioneered government-run health insurance and welfare programs in the 1880s.
The label "social democratic" is problematic. While it now signifies a mainstream, middle-class, neo-corporatist orientation; many early social democratic parties, including the massive one founded in Germany (SPD) in 1875, were originally radical, working-class, socialist affairs.
Between the introduction of Bismarck’s Anti-Socialist Law in 1878 and its lapsing in 1890 some 1,500 socialists were incarcerated and hundreds of socialist publications banned. Although driven underground individual SPD members successfully ran for office. When the Anti-Socialist Law lapsed in 1890, and the legislature refused to reinstate it, Bismarck told Kaiser Wilhelm to execute a coup. Instead Wilhelm dismissed the aging Bismarck and briefly postured as pro-worker.
In the 1890s unions and socialist parties grew across Europe alongside the inexorable expansion of the industrial workforce. Unions made inroads among semi-skilled and unskilled workers. By 1914 25% of German workers belonged to unions. An equal number were kept from union membership by economic and political controls related to employment monopolies and company-supplied housing. Non-unionized workers played pivotal roles in the German strike wave of 1905 and the German Revolution of 1918-19.
Although the SPD eschewed revolutionary rhetoric and anchored itself to legal means, its members continued to be harassed after 1890 and were excluded from civil service employment. In 1889 Wilhelm ordered all teachers and professors to combat the spread of socialistic ideas. Between 1890 and 1913 over 100 SPD journalists suffered incarceration. Restless talk within German ruling circles about coups and crackdowns pervaded the SPD with dread.
This political environment, coupled with establishment efforts to cultivate a conservative, guild-style, labor movement, split the SPD in two. Nevertheless, SPD-affiliated union membership leapt from 100,000 in 1890 to 2.6 million in 1914 while its share of the popular vote spiked to 20%.
Divisions within the SPD widened during World War One. Under the leadership of Friedrich Ebert (a monarchist saddle-maker cum anti-socialist bar-owner) the SPD supported the Kaiser’s war effort. As their western front crumbled the German High Command turned to parliament and the SPD for support. This process culminated, after the Kaiser’s flight, in Prince Maximilian’s unconstitutional transfer of the Chancellorship to Ebert on the understanding that the aristocracy would retain control of the military and that squelching revolutionary activism would be the government’s first order of business.
Ebert’s (majority) faction within the SPD considered the revolution completed when they attained power. The SPD’s minority faction and splinter groups like the Spartacists, along with myriads of leftist independents, expected the revolution to go further. In Berlin, as elsewhere, newly minted workers’ councils formed militias. The majority SPD formed rival militias with funds from foreign governments and German elites. Ebert negotiated a secret pact with Freikorps Commander General Groener.
The SPD and Spartacists both chose January 5, 1919 as a day of demonstration in support of the revolution. Even the Spartacists were amazed when hundreds of thousands of Berlin’s workers, professionals, and housewives poured into the streets, many of them armed. On January 6 shops remained closed and the crowds increased hourly. Then, at a meeting at Ebert’s office in the Chancellor’s Palace, the head of the Prussian War Ministry appointed SPD stalwart, Gustav Noske, the Commander-in-Chief. Noske departed for a Berlin suburb with Prussian General von Luttwitz to mobilize infantry and cavalry.
Later that day Berlin’s demonstrators were ambushed by machine gun fire from rooftops. Berlin was kept in state of terror for ten days while Noske’s forces deployed artillery and aerial bombardment on leftist strongholds. Similar crackdowns, directed by the SPD, hit eastern Prussia and Bavaria. Indicatively, in Munich twelve leftist SPDers were summarily executed by their erstwhile SPD comrades.
In early March 1919, after the revolution and general strike in Berlin had been suppressed, working class districts were subjected to house-to-house searches. During this operation 1,500 Berliners, including women and teenagers, were marched in handcuffs to the nearest walls and machine gunned. (5) The public face, and soundtrack, for this atrocity was… social democracy.
March 1919 also saw the launch of the Fascist Revolutionary Party (FRP) in Milan. The FRP closely copied the Italian Nationalist Party (INP); founded a decade earlier by a clique of wealthy Italian politicos seeking working class credentials. The INP’s paramilitary wing sported monochrome blue-shirts and its leadership spouted a melange of Marxist and nationalist verbiage. They coined the phrase "national socialism." The FRP and INP merged in 1923, two years after the FRP dropped its syndicalist and leftist trappings; rebranding itself the National Fascist Party. INP’s chief ideologue, Professor Alfredo Rocco, an ardent corporatist, became one of Mussolini’s cabinet ministers.
Like their Italian counterparts the German oligarchy realized they could rule through either naked force or through alliances with lower class elements who could supply a popular base. The SPD’s reputation as a workers’ party, and its connections to organized labor, were used to effectively hobble rank and file resistance. On the other hand, the SPD’s democratic constitution, and its formal integration into unions with democratic constitutions, rendered it an unreliable instrument for the oligarchy. The SPD government functioned as a stop-gap while elements from the oligarchy frantically fashioned new parties that were "socialist" and "worker" in name only.
Military intelligence officers and aristocrats atop the Thule Society, Pan-German League and the massive but short-lived Fatherland Party invented the German Socialist Party in 1918, and the German Workers Party on January 5, 1919. The former party dissolved into the latter which renamed itself the National Socialist German Workers Party (Nazi Party) in 1921.
Meanwhile, the SPD continued tacking rightward. In the mid-1920s they supported the presidential candidacy of the Kaiser’s former Chief General, Paul von Hindenburg. In the late-1920s the SPD converted police forces under their command, like the 700-strong Berlin Police Department, into de facto security guards for what was then the largest fascist paramilitary – Steel Helmet. (6) The SPD’s credibility plummeted. President von Hindenburg, in January 1933, handed the Chancellorship to Hitler.
On January 5, 1974 a column of armoured vehicles containing 150 British troops, decked in full battle order, snaked into Heathrow Airport. They stayed a fortnight. This operation, conducted under Conservative Prime Minister Heath’s watch, was thrice repeated in 1974 during the tumultuous inflation-wracked early months of Labour Prime Minister Wilson’s second government.
Wilson had no foreknowledge of these, or other, suspicious military maneuvers which he sincerely and soundly took to be coup preparations. He and long-time confidante, Labour Party political secretary Marcia Williams, spent 1974 and 1975 waiting for the second boot to drop. Williams expected the coup to start with Royal Horse Guards abducting Wilson. (1)
Alongside the suspicious military maneuverings ran a disinformation operation codenamed Clockwork Orange (a name taken from Anthony Burgess’s 1962 dystopia; adapted to film in 1971). Clockwork Orange began in 1973 with MI5 and Army information personnel giving private briefings to journalists whereat Wilson and his appointees were smeared as: communists, IRA sympathisers, KGB agents and bribe-takers.
The coup’s protagonist was Lord Mountbatten (nee Battenberg): uncle of Prince Philip; cousin of Queen Elizabeth; mentor of Charles. This former Chief of Defense Staff (1959-1965) had maps and timelines detailing the arrests of Wilson’s Cabinet and of militants within the Labour Party and union movement. On the morning of the coup Elizabeth would broadcast a speech imploring Brits to stand by their armed forces. As British officers pledge allegiance to the crown, not to parliament, there would be no constitutional conundrum.
Among the coup plotters were billionaire James Goldsmith, (Ret.) General Walter Walker, David Sterling and Cecil King. Sterling, the founder of the SAS, spent 1973-4 touring high society venues as head of GB75. He circulated Clockwork Orange rumours and encouraged aristocrats and business leaders to form militias. General Walker did likewise.
In 1968 newspaper magnate Cecil King sacrificed both his Bank of England directorship and his chairmanship of International Publishing Corporation (then the world’s largest publisher) by penning a front-page op-ed for Britain’s top circulation newspaper calling for an extra-parliamentary overthrow of Wilson’s first government. King was the nephew and understudy of Viscount Rothermere, famous for throwing his newspaper empire behind Oswald Mosely’s British Union of Fascists in the 1930s.
Anyone finding the above scenario unbelievable is guilty of presentism.
In 1974 Spaniards writhed in Franco’s grip while Portugal’s authoritarian corporatist regime celebrated its 48th anniversary. Greece had squirmed under the Colonels for several years. Italy narrowly escaped a similar fate in 1970 when hundreds of military and intelligence officers, allied with leading industrialists, and led by pretender-King Victor and Prince Junio Borghese, botched an impressively orchestrated coup.
Europe’s neo-fascists were well represented in the violent takeover of Chile on September 11, 1973. They figured more prominently in the agonizing destruction of Argentine civil society which in 1974 saw a juggernaut of right-wing terrorism clear the path for the 1976 pogrom. The worst excesses of Brazil’s 20-year military dictatorship – the years of lead and torture – occurred during Emilio Medici’s reign (1969-74). January 1974 marked the mid-point of Bolivian General Hugo Banzer’s first junta aided, as it was, by flamboyant national revolutionaries and Falange-socialists.
In 1974 South Vietnam groaned under the boots of General Thieu’s cabal who seized power in a 1963 coup wherein Thieu distinguished himself as the most sanguine of the pack. Although Ferdinand Marcos had been Philippine President since 1966 his dictatorship dates to a September 23, 1972 declaration of martial law. In 1974 South Korea’s Park Chung-hee basked in his 13th year of tyranny. Chiang Kai Shek and his Kuomintang remained ensconced in Taiwan while their World Anti-Communist League oversaw influential chapters in 40 countries.
1974 was the heyday of the CIA whose agents worked cheek by jowl across the Caribbean and Central America with sub-fascist monsters like Baby Doc Duvalier and Anastasio Somoza. Anglo-Americans numbered among their allies: a dozen brutal African regimes; a similar number of absolutist Arab monarchies; the Shah of Iran; and apartheid South Africa.
The January 1974 issue of Cambridge’s The Review of Politics showcased Still the Century of Corporatism by 38-year-old American political scientist, Phillipe Schmitter, who began his paper by thanking the Council of Foreign Relations and Carnegie Endowment for their support. (2) Influential contacts (and corporatist predispositions) came easily to Phillipe. He was born in Washington DC to an academic father who specialized in New England’s agricultural marketing boards before assuming a welfare policy position in FDR’s Administration.
Phillippe received a degree in international relations from the University of Geneva before transferring to Berkeley. In 1966 he left Berkeley for Brazil. While marvelling at Brazil’s hierarchical monopolistic interest structures Schmitter happened upon a tattered copy of Mihail Manoilescu’s The Century of Corporatism in a Rio bookstore. This epiphany, according to lore, inspired Schmitter’s deep delve into fascist social science.
The title of Schmitter’s 1974 paper recalls Manoilescu’s book. The paper commences with a quote from Manoilescu and identifies Manoilescu as "the most original and stimulating of corporatist thinkers." (3) Eight of its 43 pages are devoted to Manoilescu and Manoilescu’s distinction between pure and suborned corporatism is a central theme. Nevertheless, the paper neglects to tell us who Manoilescu was.
Mihail Manoilescu’s birth in 1891 unto a wealthy and political Romanian aristocratic family launched his furiously ambitious political career. An engineer by training Manoilescu self-educated in economics and plied this knowledge while a cabinet minister in several Romanian regimes between 1920 and 1944. He sat in multiple cabinets of the reactionary putschist King Carol II. During Carol’s reign Manoilescu met Mussolini; a man whom Manoilescu praised throughout his life. (4)
Manoilescu financed the macabre fascist Iron Guard and campaigned for a senate seat for an Iron Guard front group. He served as an envoy in the Ionescu-Iron Guard government and as foreign minister for the pro-Third Reich Gigurtu junta. He was arrested in 1945 and died in jail five years later.
Manoilescu shared the classical economist’s focus on the purchasing power of a unit of labour on the world market. He departed from classical economics by contending that industrialized labour, being more valuable than agricultural labour, made free trade a swindle for backward countries.
Romania’s economic strategy had been to maximize agricultural exports. The 1864 abolition of serfdom proved a purely symbolic modernization as Romanian landlords (like the Manoilescus) competed on world markets by intensifying the exploitation of their tenant farmers. This process climaxed in a tenant farmer rebellion and subsequent slaughter of over 10,000 unarmed farmers. Mihail was 16 at the time.
As Mihail rose to prominence Romania exported large volumes of grain (and oil) but its underdeveloped banking and industrial sectors remained foreign owned. In three books published between 1929 and 1942 Manoilescu criticised Romania’s nascent capitalist class as wasteful and vision-less. Romania’s industrialization would have to be state driven. The state had to protect high labour-value industries. The state must mould a capitalist class.
Manoilescu’s books sold well in Latin America especially among Brazilian officials in Vargas’s corporatist New State (1937-1945) who wished to rapidly industrialize their underdeveloped agrarian country. (The dictator Vargas himself equivocated regarding protecting "fictitious industries.")
Manoilescu’s Latin American adherents demanded tariffs and import substitution. They bemoaned the vulnerabilities of the export commodity economy and denounced free trade as colonialist. Manoilescu presaged the UN Economic Commission for Latin America’s (ECLA) agenda. His writings were re-published by prestigious ECLA economists. It was not just Manoilescu’s protectionism and corporatism that won accolades; his unabashed elitism and defence of the one-party state also went down well down south.
Still the Century of Corporatism rocked academia. The paper has been cited 4,021 times; far more than any other paper on corporatism. Corporatism Studies ignited. Soon corporatism was receiving obsessive attention from professors who considered Schmitter their high priest. "Mr. Corporatism" spread disdain for the "Anglo-Saxon path." He snidely intoned that comparative politics did not begin in 1950s America. His disciples eschewed Anglo-American ethno-centrism. (5)
In the 1970s European political scientists claimed tri-partite alliances of government, business and labour, coupled with the welfare state, signalled corporatism’s return. This political configuration (promoted by both Christian Democrats and Social Democrats to foil American-style liberal capitalism) went by many names: ordo-liberal, social market, social partnership, Nordic model etc.
Led by the Austro-Scandinavians, governments granted special status to select labour and business leaders and then integrated these leaders into decision-making bodies; thereby blurring the public-private boundary. In exchange these interest group leaders, especially the labour leaders, delivered stability by disciplining their members. Neo-corporatism functioned best where there was a high degree of unionization and hegemonic dominance by a social democratic party.
"Neo" was one of many prefixes academics hyphenated onto corporatism; others included: liberal, societal, quasi, and democratic. As corporatism’s main aim was reducing labour-capital conflict, the focus of Corporatism Studies was labour relations. (Inevitably, as academics clamoured to exalt corporatism the concept became stretched and tangled.)
Anticipating this corporatist revival, Still the Century of Corporatism, commences:
"The first step, I propose, is to rescue the concept of corporatism from various usages of it which have crept into the literature… the most difficult task is to strip the concept of its pejorative tone and implication..." (6)
The paper’s definition of corporatism, destined to launch a 1,000 turgid re-assessments, is:
Corporatism can be defined as a system of interest representation in which the constituent units are organized into a limited number of singular, compulsory, non-competitive, hierarchically ordered and functionally differentiated categories recognised or licenced (if not created) by the state and granted a deliberate representational monopoly within their respective categories in exchange for observing certain controls on their selection of leaders and articulation of demands and supports. (7)
The adjoining footnote credits Manoilescu for this definition. Schmitter admits redacting any mention of: a) how totalitarian a corporatist state need be; b) employer representation in labour union governance; and c) whether councils of corporations should displace elected legislatures. (8)
Pre-1974 Pluralism Studies overwhelmed Corporatism Studies. Both paradigms focussed on the role played by interest groups in government decision-making. Both emphasised: a) the professional, bureaucratic nature of lobbying groups; b) the interpenetration of public and private sectors; and c) the decline of partisanship. Some considered corporatism to be merely a type of pluralism.
Schmitter stressed that pluralist interest groups were: a) not necessarily state licensed; b) not limited in number by the state; c) not monopolistic with regards to their own constituencies; and d) and did not have state modified organizational structures. Pluralism denotes a free market of activists, lobbyists and pressure groups. Corporatism regiments this domain into a fixed array of state-centered vocational bureaucracies. Corporatism is a far more structured form of interest group activity than pluralism. (9)
To Schmitter fascism was a corruption of corporatism. He distinguishes "societal corporatism" from "state corporatism" (fascism) and sneers at how the latter diligently replaced unions with compliant syndicates while leaving businesses associations untouched. (10) He further criticizes state corporatists with:
"Hence, while they are often capable of decrying, in lurid and quite convincing terms, the inequitable and rachitic performance of existing capitalist institutions (and of conjuring up terrifying visions of life under godless socialism), they are obviously not very concerned with revealing how the forceful implantation of corporatism acts as an instrument for rescuing and consolidating capitalism rather than replacing it." (11)
It was not only state corporatists who rejected liberal capitalism, all corporatists did, including societal corporatists. Here Schmitter calls upon Lord Keynes and Sir Andrew Schonfeld. The former, he praises as the: "first major theorist to perceive certain emergent imperatives of capitalism and to link them explicitly to corporatism." (12)
Schmitter quotes at length from Keynes’s: The End of Laissez Faire:
"It is not true that individuals possess a prescriptive "natural liberty" in their activities… The world is not so governed from above that private and social interests always coincide. It is not a correct deduction from the Principles of Economics that enlightened self-interest always operates in the public interest. Nor is it true that self-interest is enlightened, more often individuals acting separately to promote their own ends are too weak to attain even these. Experience does not show that individuals, when they make up a social unit, are less clear-sighted than when they act separately." (13)
"I believe that in many cases the ideal size for the unit of control and organization lies between the individual and the modern state. I suggest therefore, that progress lies in the growth and recognition of semi-autonomous bodies within the state…I propose a return, it may be said, towards medieval conceptions of separate autonomies." (14)
Schmitter’s second witness, Sir Andrew Schonfield (1917-1981), was a Financial Times journalist and a British Labour Party wonk famous for advocating extensive government direction of the private sector as an alternative to socialism. His membership on the Royal Commission on Trade Unions and Employers Associations (reported 1968) landed him a plum job atop the Social Science Research Council. From 1969 through 1971 Sir Andrew was the field marshal of British social sciences.
Schonfeld’s Modern Capitalism (1966) calls for a positive state to: promote employment and growth; check inflation; smooth out business cycles; regulate working conditions; cover economic risks; and resolve labour disputes. These ends would be achieved through large state-coordinated interest groups.
According to Sir Andrew:
"The major interest groups are brought together and encouraged to conclude a series of bargains about their future behaviour, which will have the effect of moving economic events along the desired path….It is curious how close this kind of thinking was to the corporatist theories of the early writers of Italian Fascism in the 1920s. Corporatism got its bad name, which has stuck to it, essentially because of its association with the one-party state." (15)
At this juncture we shall call a third witness, not from Schmitter’s paper, but from a 1977 critique of that paper by Professor Leo Panitch whose star anti-capitalist, Aubrey Jones, is introduced as a: "prime mover of corporatist structures under Conservative and Labour governments." (16)
Aubrey Jones (1911-2003) was an International Labour Organization bureaucrat; a British Military Intelligence Captain; and a journalist for The Times. For much of the 1950s and 1960s he was both a Conservative MP and the head of the British Iron and Steel Federation for whom he lobbied unsuccessfully against nationalization. Later, as a cabinet minister, Jones ran nationalized industries. Still later, PM Wilson picked Jones to run the Prices and Incomes Board (PIB). After being sacked by PM Heath, Jones drifted to the Liberal Party whilst arguing for a permanent PIB "with teeth."
Here is a sampling of Jones’s political philosophy:
The greatest evil of all wrought by individual capitalism was the division it drove between the two classes… the labourer, preoccupied with the day, was left bargaining helplessly against an employer secure in the present and uncertain only about the future… The classic remedy for labour’s plight, trade unionism, solves only part of his troubles… (It) was never intended to bridge the gap that had grown between employers and employed; it served rather to widen it and exacerbate the strife between the two sides. For trade unionism itself became infested with the doctrine that the struggle of the classes was something inevitable; the struggle was looked upon as scrawling itself across the whole of history; and the more inevitable it is accepted to be; the more implacable and the more permanent does it become…
Conflict follows only because labour is an outsider in industry… the bigness or smallness of the common pool of profits means nothing to it; it is intent only on the size of its own share; and is tempted to act irresponsibly….
Labour must be made to feel the same purpose of capital…
Authority remains with the employer, it is he who still controls. But those who are controlled are taken into his confidence, their views are solicited, and so the control, by becoming less of an imposition, is made to operate more effectively. (17)
Jones, Schonfeld and Keynes were neither outliers nor innovators. They were architects of Britain’s deep state and their writings display little originality. Their advocacy of corporatism like their assaults on liberalism were more ably articulated by that veteran of both Labour and Conservative parties, Sir Oswald Mosley, the founding-leader of the British Union of Fascists.
Corporatism’s decline as an academic rallying cry tracked its decline as fa useful policy toolkit. In the late 1980s businesses showed diminishing interest in continuing corporatist partnerships with organized labour. Globalization’s enhanced capital and labour mobility, and the concomitant disciplinary effect of mass unemployment, amply supplied the wage restraint that corporatists had been selling. The slaying of private sector unionism rendered tri-partism redundant. The remaining "bi-partism", or collusion between business and government absent labour, is a political configuration distinct from what academics had been calling "corporatism."
By the 1990s "corporatism" was again a pejorative term causing some to deploy "integration", or more commonly "concertation", as alternatives. The discourse shifted from wage restraint to broader concerns about state management of privately-owned economies. Concertation, in the EU, translates into a myriad of obscure subsidies aimed at exporting your nation’s unemployment problems to the English-speaking world. (18)
After 1974 Schmitter enjoyed posh postings at prestigious universities. Now, age 80, he is Professor Emeritus of Political Science at the European University Institute. In 2009 he received the Skytte Prize; considered by Europe’s poli-sci academy to be their highest honour.
Academics don’t dwell on land. The professors who mined corporatism during its late 20th century rush were no exception.
From Williamson’s Varieties of Corporatism: A Conceptual Discussion (Cambridge, 1985) one can garner a few nuggets for the case that the landed interest, especially in Portugal, inspired and profited from corporatism; but Williamson never centres out land for scrutiny.
Wiarda’s Corporatism and Comparative Politics: The Other Great Ism (M.E. Sharpe, 1997) never discusses the political economy of landlordism and muddles the concepts of aristocracy and nobility in a manner reminiscent of Dahl’s sophistry regarding social and economic notables.
A stark exception is Simmie’s chapter in The Political Economy of Corporatism (St. Martin’s, 1985) which opens:
The comparatively recent revival in interest in the study of corporatism has been focussed mainly on the political relationships between big capital, organized labour and national government….From the point of view of neoclassical economic analysis, however, capital and labour must be joined by land as the three major categories of factors of production. Indeed, virtually all forms of production require land on which to combine capital and labour. (1)
Agog by this revelation, the editor repeats this passage in his Introduction. (2)
Like his contemporaries Simmie embraced the pluralist-corporatist dichotomy and took his definition of pluralism from Dahl; faithfully reciting Dahl’s famous query:
In a political system where nearly every adult may vote but where knowledge, wealth, social position, access to officials and other resources are unequally distributed, who actually governs? (3)
Corporatism, according to Simmie, is where effective political participation occurs during regular, secretive meetings between representatives of large commercial enterprises and senior government bureaucrats.
Simmie estimated that 32% of British land was owned by large aristocratic estates, with the lesser gentry owning 19%. This was mainly farmland. Construction companies, investment funds, and banks owned 7% of Britannia. The 1% owned by investment funds tended to be premium downtown parcels. The central government owned 9% and local governments, 8%. Ordinary house and cottage owners owned 20%. Conservation trusts owned 3.6% and the Church, 0.3%.
British land use planning, which Simmie dates to 1909, is a terraced affair involving grand national strategies, detailed county plans followed by wrangling at the local level over whether specific development proposals conform to said strategies and plans. (4)
Simmie cites the Oxford Development Plan to claim that the visible facets of planning are public relations exercises. 40% of attendees at planning fora are government bureaucrats and the Environment Ministry controls meeting agendas. As few Brits have territorial interests spanning a city or county only a handful of aristocrats, conservancies, universities, banks and/or developers send delegates. Obscure jargon-encrusted planning documents are, for the laity, undecipherable.
For an example of local plan implementation Simmie culls a late-1970s dispute regarding a London neighborhood originally zoned residential but rezoned office-land after backroom finagling by developers. Typical development approval processes consist of government officials, sometimes pressured by middle class ‘pluralist’ groups, haggling with developers for more parking space or residential units. Such bargaining is corporatist; involving secretive contact between development execs and local authorities.
Simmie hammers this point. His chapter begins:
"…disputes over land use involve political bargaining that diverges increasingly from the pluralist democratic and accountable paradigm." (5)
"At the local level effective interest representation in planning is largely confined to elites drawn from functionally differentiated organizations. This is corporatism." (6)
Simmie is most perturbed when plans are overruled. He complains:
"There are examples where both feudal landowners and producers were permitted large-scale developments in green belts." (7)
While this chapter has little to say about strategies to maximize green space (i.e. create land scarcity) in a 2006 publication of Simmie accuses Cambridge’s greenbelt of inflating land prices and inhibiting development. (8)
(In a 2014 paper Simmie describes wind power in the UK and Germany as state-driven pathways led by rural landowners and universities.) (9)
Simmie’s current avoidance of corporatist lingo is a far cry from his opening salvo in 1981 where James, still in neo-Marxist short-pants, chose to study land relations as a means to study corporatism. (10) Young James measured politics on the corporatist/pluralist spectrum and cited Dahl’s research on New Haven as his source for the thesis that control over land planning had shifted from wealthy oligarchies to independent entrepreneur-politician alliances. Simmie never questions Dahl’s methodology.
The 20th century’s most influential political scientist, Robert Dahl (1915-2014), received a Ph.D. in political science from Yale in 1940 then, after a stint in the Army, joined Yale’s political science faculty where he remained until 1986; eventually rising to Sterling Professor Emeritus. His breakaway book: Who Governs? Democracy and Power in an American City (Yale University Press, 1961) analysed Yale’s hometown: New Haven, Connecticut. Cited 7,051 times in academic literature, this book catapulted Dahl to the Presidency of the American Political Science Association in 1966. In 1995 Dahl became the first recipient of the uber-prestigious Johann Skytte Prize.
New Haven was purportedly a microcosm of the USA; a country without an oligarchy, ruling class, or power elite; with a permeable political stratum populated by politicians attuned to electorates. While inequalities of wealth, knowledge and access made America less than a perfect democracy, what existed (dubbed "pluralism" or "polyarchy") was the best of possible worlds.
Dahl wrote Who Governs between 1958 and mid-1961 amidst a raging debate about how democratic the USA truly was. The Khrushchev-Nixon Kitchen Debate occurred on July 24, 1959. Eisenhower’s warning of a creeping coup by the military-industrial complex occurred on January 17, 1961. Many American academics, not only the Marxists, believed America had become oligarchic. Dahl wrote to dispel such heresy.
Who Governs pioneered empirical research in political science. Through recorded interviews with actual political operatives Dahl’s team sought to uncover how specific groups influenced specific government agencies.
In Dahl’s narrative, New Haven’s upper class was not based in its politically inert business community and Yale was peripheral to local politics. Mayor Lee and his aides wielded power in pursuit of electoral payoffs. (11)
Dahl’s team assembled lists of New Haven’s social and economic notables. Social notables were the 231 patriarchs who attended the New Haven Lawn Club debutante ball in either 1951, 1958 or 1959. Attendance at this ball was the sole indicator of social notoriety despite the ball being but one event in New Haven’s social scene and despite the Lawn Club being but one of three elite New Haven clubs. Dahl’s social notables included managers, doctors and other aspiring upper middle class professionals.
Sociologist G. William Domhoff, Dahl’s nemesis, estimated 1,350 families (0.8% of New Haven County) belonged to social clubs. Domhoff considered multiple club membership a better indicator of social notoriety. Only a few hundred held multiple memberships.
For economic notables Dahl tabled a grab-bag of 238 businessmen including micro-bank directors, motel owners, and car dealers. They formed no power elite.
Professor Domhoff, on the contrary, unearthed a downtown establishment consisting of 10 businesses (large banks, utilities and one law firm) at the core of New Haven’s economy. At the nucleus spun the First New Haven National Bank – owner of half the commercial bank assets in the county. Its 25 directors had 26 connections to the other 9 central businesses and 52 connections to 28 other New Haven businesses. 24 directors held social club memberships. 13 held multiple memberships.
Dahl denied the existence of a downtown power elite, although he was aware it. His team interviewed at least two officials who made the following statements regarding First New Haven National Bank:
"The bank’s support is necessary for anything that is done in this town…"
"What they say goes."
"…nothing gets done without the First New Haven National Bank saying so."
Dahl suppressed this data. He also suppressed Yale’s connections to the business elite. Eleven Yale Trustees were bank directors or law firm partners. Yale’s Assistant to the President sat on First New Haven National Bank’s board. Yale retained the services of New Haven’s top law firm.
Dahl’s lists are non-representative and shoddy. (They contain non-locals and the deceased.) He used a method stacked against finding overlap between economic and social notables.
Dahl further skewed the picture in his selection of political issues. His choice of public high school curricula as an important issue ignored the fact that economic notables sent their kids to private schools thus cared little about public schools. Dahl used their absence of involvement in this issue as evidence of politically marginality.
The book’s main issue, urban renewal, received massive media coverage during the late 1950s. Recently announced federal programs helped cities buy and clear any land their city fathers defined as "slum" and to resell this land to businesses or universities.
Dahl’s economic notables were incapable of urban renewal. Dahl also deemed Yale powerless regarding urban renewal despite its being the city’s largest landowner and despite most business leaders being proud Yale alumni. He depicted Yale as alien to the business community and at the mercy of Mayor Lee. In Dahl’s hero-worshipping account it was Mayor Lee and his aides who bargained and maneuvered urban renewal into existence.
Truth be known, the downtown business establishment and Yale promoted urban renewal earlier and more intensely than anyone. A 1937 study commissioned by Yale concluded the university needed land and recommended revamping New Haven’s land use policies. The study’s author was an Old Blue hailing from a Yale dynasty, including Professors, dating to 1720.
In 1947 Yale struck a committee to explore Yale’s land needs. Committee Chair, and Yale Trustee, Prescott Bush (from the Wall Street investment firm Brown Brothers, Harriman) was another Old Blue. His grandfather entered Yale in the 1830s. The Bush Committee Report (1950) recommended a building spree for Yale, including off-campus student housing, and advocated redeveloping downtown New Haven. (The housing component was usurped by the downtown business establishment.)
Yale’s involvement was essential because urban renewal agencies could not access federal aid unless some private entity committed to purchasing the "slum" land. Yale demonstrably deployed its expertise and financial clout to attract federal, and state, subsidies. Informants told Dahl that without Yale the project would have "died aborning." In the midst of redevelopment Yale stepped in with a big loan after one private developer bailed.
In the late 1950s Connecticut Senator Prescott Bush sat on the Urban Renewal Committee and the Banking and Currency Committee (which handled redevelopment legislation). Connecticut received more urban development aid per capita than any other state. Bush’s interventions were crucial because New Haven’s redevelopment plan contravened federal guidelines; i.e. it was not really a slum clearance. Bush gamed federal agencies into ignoring such contraventions as he sliced through other strands of red tape.
Dahl’s informants stressed Bush’s role and his Yale connections. They considered Bush "most helpful" adding that when Senator Bush came to town New Haven’s redevelopment community treated him like royalty at lunches at Mory’s. Dahl suppressed this. He gave no credit to First New Haven National Bank, Yale or Bush. Only Mayor Lee and his merry men mattered.
Richard Lee was born in a working-class Irish New Haven neighborhood in 1916. Like most locals he never attended Yale; only going as far as high school. After graduating he worked for a local paper. However, by age 23 the ambitious Lee was a public relations man for the Chamber of Commerce and an Alderman.
In 1944 Yale’s powerful Secretary, the wealthy and erudite Carl Lohmann, took Lee under his wing. Under Lohmann’s mentorship Lee adopted the Yale dress code and began mouthing enlightened upper middle class slogans. He became a rare non-Yalie permitted to dine at Mory’s.
As Yale’s PR man Lee defended Yale from locals who resented the university’s property tax exemption and its stinginess both as an employer and as a contributor to city services. No Catholic or Jew had ever been a Yale Trustee; an affront to local Irish, Italian and Jewish communities.
Lee ran for Mayor in 1949, 1951 and 1953. Prior to the 1953 election several Yale honchos launched "Independents for Lee." This cabal included the Dean of Yale Law School (Eugene Rostow) and the Dean of Yale’s son-in-law, Edward Logue, a Yale Law grad with some urban planning education. Yale’s concern for local politics was further evidenced by the three Yale faculty elected as Aldermen. Dahl insists, at length, that Yalies ignored local politics.
Lee won the 1953 election with strong showings in the Irish and Yale wards. Edward Logue became Mayor Lee’s right-hand man and his Redevelopment Administrator. He also became Dahl’s chief informant.
Lee’s election marked no watershed of interest in urban renewal among New Haven elites. The Chamber of Commerce, which had been requesting a redevelopment agency since 1949, actually worried they would have to sell urban renewal to Lee and arranged a lunch at the Lawn Club for that purpose. When Lee’s aides first pitched urban renewal to the First New Haven National Bank board they were sent back to Lee and told to think bigger. In Dahl’s fable, Edward Logue heroically outlined the urban renewal scheme alone in his office one night.
Mayor Lee’s function was to assuage locals who were losing their land, being pushed out of their neighborhoods, and saddled with immense municipal debt. Redevelopment jammed blacks into public housing ghettos. Neighborhood denizens and small shopkeepers learned about urban renewal from the daily papers after the deals were done.
Pre-1953 the problem was not a lack of a Lee but a lack of federal and state funding. Part of the funding problem stemmed from a lack of traffic justification for a centrepiece of the renewal plan, the Oak Street Connector freeway (OSC). New Haven’s elite needed the OSC to expand the downtown area and contain suburban sprawl. A decision by the Southern New England Telephone Co. to build an office tower near the OSC, plus investment promises from Yale and others, won over state highway authorities. The OSC became a battering ram for destroying a neighborhood wrongly declared a slum. The OSC is now widely viewed as a blunder. An unfinished off-ramp leads to an embarrassing dead end.
For New Haven’s elite the heart of the matter was not Oak Street but nearby Church Street; i.e. office land. This part of the renewal project sucked up $40 million in federal grants and loans. The elite wanted to lure suburban shoppers back to downtown New Haven. The plan involved a marquis hotel, department stores, a plaza and a parkade.
In the late 1950s as New Haven enjoyed America’s largest urban renewal boom the glossy magazines brayed about Mayor Lee’s daring miracle. Dahl’s book solemnified this myth.
Yale is now an island of privilege in a sea of poverty. New Haven is another deindustrialized university town whose neighborhoods were bulldozed by downtown elites obsessed with raising land values. Government subsidised money-losing megaprojects keep downtown landlords rich and cities poor.
Domhoff does not appreciate what he has uncovered. Lee’s 1953 election was a Yale orchestrated coup. Yale’s Deans and Trustees undertook this project with a view to securing control over land use policies around their campus. Dahl was a co-conspirator. This textbook example of corporatist land use governance became, via Dahl’s disingenuous distortions, the textbook for denying the existence of corporatism.
Universities comprise a major part of the landed estate. Back in 1985, Simmie estimated British universities owned 0.6% of British land. There are many more British universities now. In cities across the western world, universities are often the largest local land-owners. We are not referring here only to their priceless campuses and conservancies. Harvard’s far-flung empire of farms and apartment buildings is worth $4 billion.
There is much more to the land-university connection. Search any university Board of Governors and you shall find:
a) representatives of banks, insurance firms and investment funds whose assets are largely land based; and;
b) old money/big money philanthropic families whose fortunes have solidified into land. (Such entities and individuals are also top donors to universities.)
Furthermore, tenured professors often receive eye-popping salaries. They must be 99% home owners. There is a venerable tradition of professors investing their gains into local rental housing markets. Students being 99% tenants constitute a renewable supply of customers for the landlords of university towns.
While universities, their donors, governors and professors, have diversified investments; it is safe to surmise they are very long on land. As such they express the landed interest and are ardent advocates of land conservation. Universities are not mainly in the land business. They are mainly in the ideological indoctrination business. The professor and the landlord, hand in hand always do they go.
Libertarians hold up America’s Gilded Age, 1860-90s, as that shining moment of unfettered free enterprise before corporatism’s onslaught. However, the economic drivers of this era were: the Union Government’s military-industrial complex; the post-Civil War Reconstruction; and the great transcontinental railway boom – each generously financed by government procurements, land grants, and government-backed bonds. Simultaneous to this great leap forward in statism, pro-corporatist prose poured from the pens of Europeans who viewed railroads and the opening of the American West as diabolical monstrosities. Clearly, there is more to corporatism than government-business comingling.
Two grand befuddlements occlude the view. For the first we can blame Marxists whose portrait of a ruling bourgiousie brushes over the line separating landlords from capitalists. Marx wrote obits for the landed estate in the 1840s. There is, of course, much overlap between capitalists and landlords; and both are often wealthy, prominent gentlemen. However capitalists, left untended, forever break new ground, erect new structures, and open new markets. The landed estate, on the other hand, conserves itself by cartelizing urban and rural land; by protecting domestic industry and agriculture… by reining in the entrepreneurs.
From the Seven Years’ War (1756-63) to the Paris Commune (1871) the landed estate and the upstart entrepreneurs engaged in an internecine and international struggle erupting in the American and French Revolutions, in South American wars of independence, and much else. After organized labour entered the arena the land-capital contest became subdued, submerged and subject to truce… but it never ceased.
A duel is a contest (most picturesquely: a prearranged pistol combat) between two persons or parties. A truel is like a dual only it involves three persons or parties (or economic classes). In truels alliances may form… but watch your back.
The three factors of production (land, labour and capital) each sponsor relentless micro and macro exertions and connivances toward aggrandizement. In politics this truel is not obvious. From three primary colours a thousand hues are blended. As well, the common interests of classes always conflict with the particular interests of certain members.
When corporatists list the few dozen economic sectors whose leaders are to be incorporated into their New State, they never list "landownership" as a sector (although they usually mention agriculture). Corporatists silently presume an aristocratic substructure. In academic tomes the landed interest omnisciently narrates the social diagnosis. Schmitter’s class-neutral state and Dahl’s polyarchy redact references to a landed oligarchy.
Struggles for hegemony entail struggles for the banking sector. Modern governance and high finance first merged in the 1690s when the Bank of England funded William III’s war with Louis XIV in exchange for a monopoly on limited liability banking and currency issue. American money dates to a Civil War arrangement allowing banks to print dollar bills equal to the amount of Union bonds they purchased. However, it was only over the last several decades that banking and the landed estate merged. In many countries, certainly the USA, banks were prohibited from owning land directly and real estate mortgages were too risky for blue-chip financiers.
American banking, among other things, became partly corporatized during FDR’s lengthy administration. In 1935, after the Supreme Court blocked FDR’s Mussolini-inspired National Recovery Administration, the ruling Democrats advanced across a pontoon bridge of agencies like the Securities and Exchange Commission, National Labour Relations Board, and notably, the Federal Housing Administration and Federal National Mortgage Association.
Corporatists believe home ownership transforms obstinate workers and minorities into loyal gentry. The banker-friendly "fair housing" movement reared its head prominently in the 1970s when the Senate Committee on Banking and Currency rebranded itself as the Committee of Banking, Housing and Urban Affairs. The fair housing movement facilitated mortgages for sub-par borrowers thereby pumping up mortgage debt and the real estate bubble that burst in 2008.
Resolving the 2008 crisis cost US taxpayers well over $1 trillion. A grassroots mobilization, the Tea Party, emerged among Americans unwilling to bail out under-water homeowners and their financial enablers. Without the bailout several million houses would have been abruptly dumped onto the market. The concentrated benefit that a bailout would bring to delinquent homeowners and bank shareholders trumped the diffuse cost of that bailout to taxpayers. Remnants of the Tea Party played a lead role in Trump’s victory over the Republican establishment in the 2016 primaries.
The 2008-9 bailouts solidified the government-banking complex. In the US and EU major financial institutions are either state-owned or "too-big-to-fail." The latter, the Systemically Important Financial Institutions (SIFIs), employ many former and future government bureaucrats. SIFI execs boast about their intimate partnership with regulators. The mutual penetration involves SIFIs selling (and accumulating) government bonds while governments regulate and prop up SIFIs. Most SIFI assets consist of: real estate mortgages, real estate itself, government bonds, and loans to the ecological-industrial complex. Thus, the most unproductive, parasitic components of the financial and real estate sectors successfully usurp political power and create a parallel economy driven by politicians not consumers.
Let no one discuss land economics without discussing land conservation and other land use restrictions. State-sanctioned vetoes over the use of public lands are but one of the many calculated rigidities imposed on markets by land-owning cartels seeking to stabilize rents. Real estate development is so over-regulated that new construction projects require protracted campaigns aimed at zoning changes, condemnation approvals, infrastructure support, loan guarantees, tax breaks and subsidies. New projects are monuments to the tenacity and perspicacity of the teams enabling them to be built. (1)
The second grand befuddlement obscuring our view involves treating "social democracy" as if it were a working class manifestation. Social democracy, corporatism’s Protestant twin, is an expression of the landed interest. Their welfare state consists largely of taxpayers paying the housing costs of the unemployed. A week after dole cheques are issued the lion’s share of the disbursed money sits in the bank accounts of landlords. Government assistance programs engender legions of dependents and hypertrophied bureaucracies whose combined electoral clout bolsters the social democratic hegemony.
Except for that anomalous decade (1900-10) when Teddy Roosevelt and the Progressives hijacked the Republican Party; America’s corporatist (social democratic) vanguard has been the Democratic Party. Pre-1960 the Democrats were the party of racist Dixiecrats in the South and priest-ridden big city electoral machines in the North. They coopted the conservative American Federation of Labour in the early 1900s and the militant Congress of Industrial Organizations in the 1950s. Post-1960 Democrats domesticated independent black, feminist and Latino movements; incorporating them into their electoral machine. The Democrats’ espousal of leftist, even socialist, rhetoric merely replays a cynical corporatist practise stretching back 140 years. Bernie Sanders was the most thorough-going corporatist to contest a presidential primary since Teddy Roosevelt – a man whom Sanders repeatedly praised.
Corporatism is neo-feudalism. It slides society back to a two-tier political system of commoners and nobles. Politicians, obsessed with fundraising, become agents of rent-seeking donors. Citizens without vast sums to donate might as well forget about politics. The toiling masses are excluded.
The Clintons are exemplars of pay-to-play politics. Their open border agenda ensures entrance to a mass of non-citizen workers without basic democratic and legal rights. Their agenda will bring a police state for the disenfranchised poor and a growing licence to commit crimes for the well-connected rich. Exorbitant housing and energy costs will devour paycheques. In this world of gated communities and private cops economic activity will center on providing luxury goods for elites who will then hold forth about the evils of mass consumerism.
A clear and direct correlation exists between how corporatist a country is and how environmentalist that country is. Topping both lists is the German-Danish-Swedish-Swiss-Austrian meta-state (the Fourth Reich). Global Warming is a sweeping socio-technological regime change orchestrated by this meta-state. Their primary goal is their own emancipation from a world market system fueled by hydrocarbons. Unsurprisingly, green energy, from biofuels to solar farms, is land-based energy chiefly benefiting landowners. The deployment of pseudo-scientific rationales as political vehicles is as old as corporatism. Capturing climate science was one of the lesser tasks on their agenda.
Footnotes for: Intro
Footnotes for: Incubation of the Incubus
Footnotes for: Corporatism and Social Fascism
Footnotes for: January 1974: Mr. Corporatism’s Manifesto arrives like Clockwork (orange)…
Footnotes for: The Land beneath the Dahl House
Footnotes for the Conclusion
The list of blogposts, books, chapters, articles, and encyclopedia entries read researching this posting would be longer than the entire posting itself. What follows is a list of the more useful sources.
Bennich-Bjorkman, Li "Mr. Corporatism" awarded "Nobel Prize of Political Science" skytteprize.statvet.uu.ee
Browder, Earl. The Meaning of Social-Fascism. Workers Library Publishers. New York City. 1932.
Domhoff, G. William. Who really ruled in Dahl’s New Haven? www2.ucsc.edu/whorulesamerica/
Goldstein, Robert. Political Repression in Nineteenth Century Europe. Provident House, Croom Helm, Australia, 1983.
Greve, Michael S. The rise of adversarial corporatism. Library of Law and Liberty. July 1, 2014.
Lind, Michael. The"corporatist" confusion: Why prominent a political term needs to be retired. Salon. January 5, 2014.
Love, Joseph. Theorizing Underdevelopment: Latin America and Romania 1860-1950. Estudos Avancados January-April 1990.
Littlewood, Mark. The Social Democratic Hegemony. www.centreforum.org
Locke, Robert. What is American Corporatism? Frontpagemag.com September 13, 2002.
Panitch, Leo. The development of corporatism in liberal democracy; Comparative Political Studies, Sage Publications, April 1977.
Schmitter, Phillippe. Still the Century of Corporatism; Review of Politics, University of Cambridge, 1974.
Scruggs, Lyle. Is there really a link between Neo-corporatism and Environmental Performance? British Journal of Political Science. Cambridge University Press. 2001.
Siaroff, A. Corporatism in 24 Industrial Democracies: Meaning and Measurement. European Journal of Political Research, 1999, Wiley Online Library.
Simmie, James. Corporatism and Planning. Chapter 7 in: Grant, Wyn (Ed.). The Political Economy of Corporatism. St. Martin’s Press, New York, 1985.
Simmie, James. New Technological Path Creation, Evidence from the British and German Wind Energy Industries. Journal of Evolutionary Economics, Springer 2014.
Simmie, James. The Competitive Economic Performance of English Cities. Department of Communities and Local Government. London 2006.
Stromberg, Joseph. Corporatism as Theory and Practice. Explore Freedom. The Future of Freedom Foundation February 1, 2014.
Tilly, Charles. The Rebellion Century, 1830-1930. Harvard University Press. Cambridge Mass. 1975.
Watkins, Thayer. The Economic System of Corporatism. San Jose University Department of Economics; www.sjsu.edu
Wiarda, Howard. Corporatism and Comparative Politics: The Other Great Ism; M. E. Sharpe, Armonk, New York, 1997.
Whitehead, John - The Age of Neo-feudalism in America – government by the rich and for the rich and the corporations – Huffington Post 1/28/2013
Williamson, Peter. Varieties of Corporatism: A Conceptual Discussion; Cambridge University Press, 1985.
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