It is often claimed, and most ardently today by Mr Blair, that capitalism has changed. Indeed the very word has disappeared from polite society, being replaced in general usage by the euphemistic and much wider category of “market economy”. Thus John Scott’s book Corporations, Classes and Capitalism, published originally in 1979 and first revised in 1985, has lost the word “capitalism” in the new title for a 1997 edition, while retaining a surprisingly pluralistic reference to “capitalist classes”. Theories of industrial society and of capitalist society, according to Scott, must now be “buried” and “transcended”. This appears to mean that neither the development of industrial technology nor the ownership of capital are any longer key determinants of corporate power or of social relations in the modern world.
John Scott’s earlier books provided a comprehensive review of the literature, especially the sociological literature, on the workings of big business and its influence on class formation in different national economies within the wider framework of international capitalism. A new edition had evidently to take account of the economies in transition from the command of the Soviet Union, Eastern Europe and China, but also of further stages of globalisation of the national economies in what was still generally understood as the capitalist system.
Revising an earlier text is, as I know from personal experience, a difficult task. The temptation is to keep too much of the original and to add bits on where important new developments have taken place. The result is to make a much bigger book which carries conflicting statements and fails to clarify the real changes in structures and relations, both economic and social. The major changes which Scott identifies since 1985 he calls economic “disorganisation” of capitalist (sic) societies and “disarticulation” of national economies. By these terms he seeks to describe the ending of what could be called “national capitalism”. Private ownership of capital is, he believes, no longer the chief organising force in national society and the nation state is no longer the chief articulating force in the world economy. The impersonal transnational company has transcended both private capital and the nation state.
There are many occasions in Scott’s new book where the hangover of formulations from earlier editions obscures the argument. The use of the present tense about events occurring in the 1970s and even in the 1960s and 1950s gives a particularly misleading impression. The presentation of statistical tables of movements over time which do not go beyond the 1970s compounds the impression of uncertain change. References to the literature published in the 1990s makes up less than 10 per cent of the bibliography of more than 1,000 entries. Earlier works are cited and statistical tables incorporated in the text from several authors, including myself, without reference to later editions and revisions.
A particular example occurs in the references to the City of London. On page 115 we read that “there was a sharp separation of City financiers from provincial manufacturers” (according to the context that was in the later part of the nineteenth century). On page 120, however, by the 1970s according to the context, “There was no real separation of the ‘City’ and ‘Industry’”. On page 231 “The separation of the City and industry …” appears as typical of years before the First World War. Yet, on page 267 in relation to the 1980s, we read: “Through all the subsequent vicissitudes of intervention and deregulation the City view point remained central to British industrial and economic policy”. Finally, on page 270 it was apparently after the 1980s that “the City became a disarticulated element in a disarticulated national economy”. All these contradictory references could be to successive periods of history, as I have suggested, but no explanation is given for such sharp changes back and forth over time. Ingham’s argument for a City/industry divide continuing to this day is quoted but not the responses to it, including my own.
Because of these uncertainties and contradictions in the text the central case that Scott is making for capitalist “disorganisation” and political “disarticulation” is very hard to pin down. He is, I believe, rightly critical, of the managerial view that owners of capital have lost all power to their managers, but regards individual entrepreneurial capitalists as no more than a survival from the past. He recognises ownership of capital as a source of great power but wishes to distinguish several capitalist classes: entrepreneurs, rentiers, managers, service executives and petty bourgeois. He sees the strength of the Marxist view of finance capital building up financial empires but wishes (correctly in my view) to distinguish the different roles of the banks in Germany and in the UK (while never, I think, properly distinguishing the merchant banks and the High Street banks in the UK). He understands the internationalisation of the transnational companies, but doubts the existence “yet” of a “global capitalist class”. He records the growing inequality of wealth and income in all capitalist economies, but explains this as due to the rise of executives’ access to shares (through options, etc.) and not to the increasingly unregulated state of capital accumulation. He describes the reduced role of the nation state in direct economic and industrial management, but fails to realise that the indirect support of the state continues as an essential servant of transnational capital.
My own conclusion in answer to the key questions raised by Scott about “disorganised capital” and the “disarticulated state” is that neither trend has gone so far as he supposes. Capital gearing and the renewed wave of foreign direct investment and company take overs and mergers, of which Scott says very little, have greatly strengthened the power of a few very big private capitalist entrepreneurs. The role of the state, especially of the big nation states ‐ the USA, Japan, West Germany, China, India ‐ far from being diminished is an essential support for transnationally operating capital, but the Hilferding concept of national finance capital is now located only in these larger states. “British capitalism”, however much Mr Blair may seek to re‐establish its role, is not a meaningful concept but must be increasingly subsumed within European finance capital and a truly global capitalist system. Capitalism remains as the dominant system of capital accumulation which draws all peoples and societies into its maw ‐ a “dynamic market economy”, but with its own ruthless and articulating dynamic.
