The Fracturing of the American Corporate Elite

The Fracturing of the American Corporate Elite

Mark S. Mizruchi
Copyright Date: 2013
Published by: Harvard University Press
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  • Book Info
    The Fracturing of the American Corporate Elite
    Book Description:

    Critics warn that corporate leaders have too much influence over American politics. Mark Mizruchi worries they exert too little. American CEOs have abdicated their civic responsibilities in helping the government address national challenges, with grave consequences for society. A sobering assessment of the dissolution of America's business class.

    eISBN: 978-0-674-07536-8
    Subjects: Sociology, Business, History, Political Science

Table of Contents

  1. Front Matter
    (pp. i-vi)
  2. Table of Contents
    (pp. vii-viii)
  3. Acronyms
    (pp. ix-x)
  4. Preface
    (pp. xi-xvi)
  5. 1 Introduction
    (pp. 1-21)

    In October 1957, the Soviet Union successfully launched the first artificial satellite to orbit the earth. The American public reacted in panic at the possibility that the Communist power was poised to surpass the United States in space technology and, by extension, possibly military technology as well. Intelligence reports had already suggested that the Soviets were about to launch their satellite, and President Eisenhower had been duly forewarned. Most policy makers, members of the media, and the public were taken by surprise, however.

    Shortly after this episode, an organization of business leaders, the Committee for Economic Development (CED), sprang into...

  6. 2 The Rise of the American Corporate Elite
    (pp. 22-45)

    The origins of the American corporate elite can be traced at least as far back as the Founding Fathers. There are clear ideological affinities between the group that emerged in the twentieth century and early leaders such as George Washington and Thomas Jefferson (Judis 2001, 16). The corporate elite as a collective entity was a product of two historical events, however: the rise of industrial capitalism in the late nineteenth century and the reaction of business leaders to the consequences of this development.

    The period from 1870 to 1900 witnessed a revolution in American economic life. Spurred on by the...

  7. 3 The State and the Economy
    (pp. 46-80)

    It is widely assumed that government began to play a significant role in the American economy only in the 1930s. In fact, as a number of scholars have shown, the American state had already become an active force in the early nineteenth century (see, for example, Hartz 1948; Goodrich 1960). The government developed the corporation as a public institution, using it to build canals and to facilitate the expansion of the railroads (Dobbin 1994; Roy 1997). Later in the century, it became increasingly active in regulating the economy—establishing the Interstate Commerce Commission and the Federal Trade Commission, and passing...

  8. 4 Labor as Uneasy Partner
    (pp. 81-110)

    If the state created one constraint on the autonomy and actions of business, organized labor provided another. Just as the growing power and legitimacy of the government contributed to the moderate perspective exhibited by the American corporate elite in the postwar period, so too did the growing power and legitimacy of labor. The elite’s attitudes toward organized labor may have been less accommodating than those toward the state. Business, even its most moderate elements, was opposed to collective bargaining at virtually all points. But as it did with the government, the corporate elite made its peace with the labor movement...

  9. 5 The Banks as Mediators
    (pp. 111-138)

    Beyond the government and organized labor was a third force that contributed to the moderation of the postwar corporate elite: the financial community. That the banks would be a significant player in the postwar era, at the height of the managerial revolution, seems paradoxical. Banks are acknowledged by many observers to have been powerful in the early part of the twentieth century, and they are widely believed to be powerful in the twenty-first as well. In the post–World War II period, however, most observers assumed that the large nonfinancial corporations were so strong, with so much capital, that they...

  10. 6 The Breakdown of the Postwar Consensus
    (pp. 139-179)

    The problems that crested in the 1970s were all present in one form or another in the 1960s, and even the 1950s. The inflationary spiral that became the central economic problem of the decade actually began in the mid-1960s, a consequence of President Johnson’s decision to pursue an ambitious set of social programs while conducting the war in Vietnam. The foreign competition that severely hampered American manufacturing in the 1970s had already begun to raise its head in the late 1950s during the strikes in the steel industry. The crisis of legitimacy among major American institutions—triggered in part by...

  11. 7 Winning the War but Losing the Battle: The Fragmentation of the American Corporate Elite
    (pp. 180-224)

    The undoing of the constraints on the American corporate elite had already been largely accomplished by the time that Ronald Reagan assumed the presidency in January 1981. Business and capital gains taxes had been significantly reduced. Redistributive policies by the federal government had been sharply curtailed. The labor movement had become increasingly weak. And the initiatives by the consumer and environmental movements, including those involving the regulation of corporate activities, had been thwarted. The demise of ameliorative government and organized labor accelerated after Reagan took over, however. This demise, along with two further developments—the decline of commercial banks and...

  12. 8 The Aftermath
    (pp. 225-265)

    So what were the consequences of the decline of the American corporate elite for the group’s ability to act collectively? To address this question, it is useful to return to Robert Dahl’s classic 1958 article on the sources of group power. Dahl, as we saw in Chapter 1, argued that for a group to be powerful, two things are necessary: a high level of resources and a high level of unity. If this formulation is correct, then if large corporations, with their impressive resources, are able to achieve a high degree of political unity, they pose a considerable threat to...

  13. 9 The Ineffectual Elite
    (pp. 266-286)

    The goal of corporations is to generate profits, and returns to shareholders. But corporations, as they grew large in the late nineteenth century, became more than just profit-making machines. Given their size, they became a presence in their local communities as well as on the national scene. Although the corporation was the source of great wealth, this wealth was sometimes achieved at the expense of the firm’s workers and customers, and it also created costs that were borne by the larger society, including despoliation of the natural environment within which it operated. The costs that the firm created—externalities, in...

  14. Notes
    (pp. 289-324)
  15. References
    (pp. 325-354)
  16. Index
    (pp. 355-363)