That the financial crisis of 2007 represents a turning point in history, no one can doubt anymore: Past truths, economic and political, have been well and thoroughly shaken. The national democracies in the West are rotting from the inside, and the battle for the racist voices is tearing apart alliances and threatening to throw the world into trade wars reminiscent of the 1930.
The French economists Gérard Duménil and Dominique Lévy analyze in the book Managerial Capitalism: Ownership, Management and the Coming New Mode of Production the political-economic development of the 20. century, with a particular focus on the United States. They believe that society is leaving capitalism as we know it and moving into a new mode of production. They call the new system managerialism.
The managers, that is, managers of both private companies and the state, are seen here as the key players in politics and the social economy. This group constitutes a class of its own, whose ability to form alliances alternately on both the right and the left has largely determined the economic development of the 20. century.
In 1920, wages for labor accounted for 40 percent of Americans' income, today it represents 78 percent.
For a long period after the economic crisis of the 1930s, and especially after the end of World War II, the managerial class entered into an alliance with the working class within the framework of a state-run modernization economy. It not only governed private companies, but also the state, which, with the establishment of welfare, infrastructure development and education and cultural investment aimed at the working class, grew significantly and demanded ever more tax revenue. Public investment in the United States was at 2 percent of GDP before World War I; in 7, at 1 percent. As Duménil and Lévy show, economic inequality declined significantly throughout the Western world during this period, and purchasing power grew correspondingly for the wide mass of wage laborers in the United States.
From two to three classes
The authors historically go about making diligent use of statistics when showing income trends among the richest in the United States. In 1920, wages amounted to 40 percent; today 78 percent. Thus, many of the wealthiest are mainly employees – not owners of capital.
Against this backdrop, the authors revise Marx's notion of the struggle between capitalists and the working class. In the updated analysis, the production method is based on three: Classes: Owners of the means of production, the workers / "the public classes" – and the managerial class
The social order that existed for four decades until about 1970 has been named "the post-war social democratic agreement". During this period, the lower classes and the emerging group of private and public managers made a political compromise, in a historical situation characterized by depression and war. The managers allied to the left, and Roosevelt's New Deal launched this alliance.
But from being a working-solid middle class, the managerial class has thus become a new and independent upper class. Around 1970, the "agreement" between managers and workers was replaced by what the authors call "the neo-liberalist managerial capitalist financial hegemony" that lasted until the financial crisis of 2007. The Social Democratic compromise gradually became a financial hegemony, the left alliance became a alliance, Roosevelt joined Reagan.
This trend is reflected in the statistics as a growing inequality between the two societies. In short, managers start to get a lot more in pay than production workers – and the migration up the one percent is in progress.
leaders has gone from being a working-class middle class to being part of the upper class.
However, the financial crisis heralds a shift in which neoliberal managerial capitalism continues hero to take over the power of the capitalist class. Thus, it is no longer those who own the means of production, but those who administer them who are the ruling class. Those who lead the big corporations and sit at the top of the state and governmental institutions are the new upper class – those who possess the political and economic power.
Duménil and Lévy's book is an important contribution to analyze the social development in retrospect as well as to the discussion of the ongoing transition. Although, somewhere in the book, they warn against leftist managerialism, they nevertheless end up putting the post-war social-democratic compromise and the neoliberal reaction against each other.
It is true that the alliance between the working class and the managerial class managed to tap into the swampy greed of the market, and that the structural production of misery was swept away by social politics and consumption in the West. But we must not forget the global conditions for the class compromise.
The post-war social state cannot be the goal of system-critical action. The revolution is not a possible new alliance between the lower classes and the lower parts of the managerial class; the revolution is still the settlement of the monetary economy and the nation state.