Monday, August 3, 2009

The History of the Corporate-Commercialist State, Pt2: Mass Media

As important as the massive corporate power aggregated by the trusts in the Gilded Age and Progressive Era was to the creation of a corporate utopian political creed to replace the old Jeffersonian agrararian utopian creed of the pre-Civil War conservative movement, and as dramatic an effect as this corporate power had on American capitalism, by themselves the trusts were not in a position to truly change the face of the American economy. Teddy Roosevelt, William H. Taft, and Woodrow Wilson were all active 'trust-busters' and committed to varying degrees of liberal social reform. Indeed, many political historians have said (with considerable accuracy) that differences between T.R.'s 'Progressivism', Taft's 'Gradualism', and Wilson's 'Liberalism' were so slight that the real difference in the election of 1912 was the split Republican vote between Roosevelt and Taft and the failure of Roosevelt's health after he was shot in a failed assassination attempt before a campaign speech rather than any real preference for Wilson's policies among the electorate. The policy positions of all three were remarkably similar, and on the issue of corproate power it was Taft who was the biggest 'trust buster' and most 'liberal' of the three despite his commitment to fiscally conservative principles.

Wilson represented the prototype of the modern American liberal, with notions of democratic freedoms coupled with social reforms creating a different kind of utopia from that envisioned by either the old Jeffersonian aristocrats (though much of Wilson's thinking was Jeffersonian in origin) or the new supercapitalist corporate aristocrats. While this has led to its own unhealthy offshoots (most notably the 'nanny state' philosophy) down the road, it was certainly far healthier than the corporate alternative and gave Wilson a strong motivation to resist unrestricted growth of corporate power. However, the political consequences of Wilson's intervention in Europe during WWI and his grand plan to extend his utopian vision to the entire world through the post-WWI peace process were disastrous for any kind of liberal thinking... utopian or not.

Wilson was succeeded by the incompetent Warren G. Harding, who admitted his own incompetence to be president cheerfully and whose inept and corrupt administration served as the perfect prototype for the Reagan and George W. Bush administrations of later years. During his brief administration the seeds were sewn for a return to Gilded Age economic and social policies and after his deat his successor, conservative VP Calvin Coolidge, would preside over the massive boom in stock speculation that led directly to the Great Depression during the first and only term of his successor, the ironically far more progressive Herbert Hoover.

What is important about all of this recap is that it set the stage for a massive shift in corporate management... the break-up of the trusts had transferred corporate ownership from single, huge stockholders to a much wider circle of investors and had given some reality to the basic principle of capitalism most lauded by those who associate it with democracy and freedom... quasi-democratic participation in the economy through the purchase of stock. Corporate officers went from megacapitalists like Carnegie and Morgan to employees of boards of directors representing the stockholders. While there was still a signficant representation of the new corporate aristocracy among the corporate boards, corporate officers were professionals whose job was to provide competent management and produce a good product for a fair price. This would have good consequences and bad. On the one hand, it would slow the growth of the raw power of the new corporate aristocracy and open it up to a wider membership. On the other, it would further instill utopian ideas in the minds of many corporate directors as they felt themselves responsible parties for their employees and came to see this relationship as natural and right. This would appear to be innocent, as most of these individuals (Henry Kaiser is one of the most notable examples) provided extremely good benefits to fulfill this role.

The problem, of course, is that this feeling of responsibility would ultimately become a feeling of ownership. This feeling of ownership of one's employees has strengthened as feelings of responsibility have waned or disappeared entirely. Today's corporate institutions demand more and more from their employees while offering less and less in return, frequently making the old Marxist label of 'wage-slavery' more accurate than would make us all comfortable.

Around this same time, radio changed the way way corporations sold their product. The advent of the radio meant the advent of the genuine commercial advertising so common today. Radio programs were sponsored by corporate interests, which made offering radio service to the nation far more practical than selling radio programming only to those able to afford it. The catch was that the corporate advertiser gained influence over the medium. In a sense, it is impressive that advertising remained as relatively low-key and essentially honest as it did for so long.

After WWII, with radio advertising firmly set in the American experience, television began to appear in more and more homes. The television set was, and remains, the most lucrative and powerful commercial instrument in the world. American television was quickly dominated by corporate sponsors. who soon achieved a significant amount of influence over the content of television programming. Though tv news was initially kept strictly separate from tv entertainment, the entertainment programming was geared to keep people watching the commercials. As time went on, someone came to a brilliant discovery...

Everyone watched tv, listened to the radio, or both. This meant that a corporation did not have to be restricted by the simple task of meeting society's economic demands. It could create demand itself through commercial advertising. One could manufacture a new product, test market it, and then advertise it on a massive scale between segments of the 'Lone Ranger' or 'I Love Lucy.' This advertising would frequently ensure that someone would buy the product, and the more massive and skillful the advertising campaign then the more successful the product would be. The product did not have to be necessary, it just had to be something that lent itself to mass marketing. One could convince Americans what they needed. Though historians and sociologists have frequently referred to this as 'consumer culture', it was really commercial culture. Corporate sponsors sold culture as a means to sell shaving cream and beer.

Of course, the business interests best able to take advantage of the big media were big business. Television commercials cost money. So the corporation has a natural marketing advantage over the entrepreneur. This made it increasingly easy for a few corporations to dominate markets once shared by many entrepreneurs. This crowding out of entrepreneurism by sheer weight of corporate capital, through the means of commercial culture, was fundamentally anti-capitalist and served to undermine the free market on a massive scale... all through the exercise of economic 'freedoms' theoretically enjoyed by all and yet only available to those with the most money. This is the double-edge of the 'free market' advocated by utopians. It fundamentally favors corporatization and cartels over entrepreneurs and competition.

The creation of commercial culture, however, was not enough to genuinely destroy capitalism in a society that still rested on basic New Deal principles of economic opportunity and democratic interpretation of individual rights. Government regulation prevented corporations from becoming too overwhelmingly powerful in most industries, but there were unsettling signs of the change to come. The US government, through the agency of the federal courts, assisted the auto cartel in preventing the establishment of a new auto manufacturing firm by entrepreneur Preston Tucker. This was an anticapitalist action in favor of monopoly and corporate commercialism. Nor would it be the last troubling sign.

To truly turn a capitalist economy into a corporate-commercialist state, corporate power would need more than the influence of mass media. It would need the active assistance of the US government.


TRUTH 101 said...

I did a post along these lines awhile back. It was more a satirical look that poked fun at the republican presidents and their running mates.

I without reservation and envy admit your post is better. Well done ER.

Chris Richards said...

I'm not good at funny, but rambling historiography suits whatever abilities I have. Thank you for the kind words. Hopefully, you'll like part 3 as much. Part 1 is just a couple posts down. :)