Public-Private Co-dependence

Everybody and their mother has invoked the old Mussolini quote (regardless of its accuracy) about renaming fascism to "corporatism". It always surprises me how many different political conclusions this point is used to augment. For some, it means private business is bad because it takes advantage of a vulnerable democratic political process. For others, it means firms are enlisted into the agendas of big bad politicians, restraining the so-called "free market" competition that benefits us all.

When considering each competing interpretation, it's most interesting and instructive to note which institution plays the victim and which the oppressor. After all, the quote is often used by people who assume the legitimacy of both big business and big government. The quibble lies solely with the relative power of one party relative to the other.

To my mind, the victim/oppressor dichotomy is positively self-reinforcing. In this case, the ontological dynamics serve to restrict what might be a broader conversation about not just the powers that be, but the powers we might have alternatively. Even radicals reinforce these established concepts: capitalists must have an articulable definition of the corporation and of the government to be able to ensure the victory of one over the other. Same for radical communists. If they didn't have set definitions of each institution, how would they understand the conditions of success towards which they strive?

Nobody ever considers the political climate in which Mussolini made this remark; nor do they consider the indeterminate nature of the concept of "state" and "business". And so they divide themselves into left/right positions and jockey for supremacy without instead challenging the ground rules of the game. Take this article by Nelson Hultberg, where he advances a position in the debate about whether the Federal Reserve is a public or a private entity:

For example, Exxon Corporation is considered a private corporation. So let's compare it to the so called "private" Federal Reserve corporation. Does Exxon have its CEO and board of directors appointed and confirmed by the government? No, but the Fed does. Are 97% of Exxon's profits turned over to the federal Treasury? No, but the Fed's profits are. Can Exxon be voted out of existence tomorrow by Congress? No, but the Fed can. Therefore despite what our courts maintain, the Fed is not a private corporation; it is a government run cartel.

But this is simply not true: corporations most certainly can be voted out of existence by a deliberative body, as corporations are chartered according to laws that legislatures enact. In fact, before the Civil War, corporations had to be granted a charter by a deliberate act of the state legislature, and usually for a limited time and only for limited purposes. In the same way that government supplies fiat, artificial money that we are bound by law to honor, it supplies fiat, artificial entities that we must recognize.

Congress may not preside over the appointment of anybody to the upper echelons of Exxon, but it certainly doesn't butt out, either. It's constantly looking over the shoulders of those executives, regulating the corporation to stabilize and protect it minimally from management's potential malfeasance with property it has little stake in. And surprise, surprise: those who rise to the highest levels of corporate business tend to be those who can best navigate the bureaucracy government has established. Direct appointments by senators might at least be more honest.

But the point of this post is not to rehash Reagan's old line about government being the problem. At its root, government is one aspect of a system of collusion designed to privilege some over others. The radical socialists of the 19th century understood this when they critiqued the aristocratic, nascent industrialist class that had started pulling together this giant system that would give advantages to those who knew how to navigate it. We find ourselves subject to an interlocking directorate, as C. Wright Mills would put it, involving elites in government, business, academia, and other core institutions of society. These elites are not necessarily intelligent, or even competent at management - they are skilled at maneuvering through the bureaucracy and rituals of the highly structured society we live in.

The radicals of the 19th century saw the state as larger than just the government. The state was composed of all those who benefited from the status quo. Government, business, academia, and other institutions work to stabilize this status quo as the basis of their privilege. So when Mussolini talks about a merger between corporate and state power, he is not talking about fusing business to government - that alliance already exists, and most people back then knew it, too.

Mussolini was talking about bringing all aspects of society under a smaller group of technocratic, autocratic managers. The full power of society could only be leveraged by total submission of the individual. Today, that's hardly necessary; the system has become so suffocating that its a trivial matter to convince most people to give up and become a cog in the machine. And we're not going to reach those cogs as long as we talk in terms of the machine's operating manual. The state is more subtle than the conservative "government vs. business" paradigm.

Written on Wednesday, December 23, 2009 | Tags: corporatism, left-libertarian, politics