Business and the People
To the Editor:
Since the mid-60′s, we have been witnessing the third wave of relative public hostility to business during the 20th century. Until recently, it has faithfully followed the Progressive formula discussed by James A. Nuechterlein [“The People vs. the Interests,” March]: moralistic in tone, legalistic in content, politically rooted in an educated affluent middle class, and hence, for all its anti-corporate rhetoric and substantive legislative accomplishments, essentially unthreatening to private economic accumulation.
The recent deterioration in economic performance does, however, add an important new dimension, one that I think Mr. Nuechterlein does not consider carefully. Since its rise less than a century ago, the modern corporation has been viewed with varying degrees of suspicion by both middle-class and working-class Americans. They have tolerated its size and power because of its proven ability to deliver a relatively steady, but over the long run continual, increase in material living standards. What makes the current economic crisis unique is the growing consensus by economists as well as business itself that due to a number of complex factors, including acceleration of the business cycle, the limitations of government economic management, the maturation of the economy, and the declining international economic position of the United States, we can no longer look forward to a repetition of the growth rates of either the 50′s or the 20′s during the next few decades.
American business is only beginning to confront the persistence of quality-of-life issues, left over from the 60′s, combined with widespread resistance on the part of organized labor, welfare recipients, and the middle class to reduce their economic expectations so that the private-investment system can remain viable in the 70′s—expectations painstakingly created by both liberals and Madison Avenue copywriters.
Mr. Nuechterlein should not be misled by the often confused rhetoric of the contemporary opponents of business: the issues which divide business and non-business groups are becoming more clearly defined around such matters as the “just price” for essential commodities, the continued expansion of the welfare state, the control over U.S. investment abroad, the content of public investment, and the distribution of scarce resources—including wealth. In America, serious class conflict may yet materialize, though couched in Populist rhetoric.
University of California
James A. Nuechterlein writes:
David Vogel argues that the American economy will be unable in the future to sustain acceptable growth rates. Because of this failure by business to deliver sufficient economic payoffs, he suggests, long-latent hostilities toward the business community will emerge and produce in America genuine class conflict, as opposed to the limited and “essentially unthreatening” anti-business impulses of earlier Progressive and Populist movements.
My article was concerned with historical and political analysis, not economic prediction, and so did not really consider the matters Mr. Vogel raises. His prognostications may or may not be accurate; since I am a historian and not an economist, I can offer no expert comment, though I would question his description of a “consensus” among economists (much less businessmen) in support of his pessimistic forecasts. For what it is worth, my own guess is that American capitalism will be in the future, as it has been in the past, considerably more adaptable, resourceful, and successful than its critics regularly predict. I am reminded of all the death-of-capitalism analysts of the 30′s, with their assumptions of “secular stagnation” and the end of economic expansion. Given the far deeper economic crisis of those years, such pessimistic predictions had more immediate plausibility than do current ones. That they were wrong provides, of course, no necessary clues to what might happen today, though it is a perspective perhaps worth keeping in mind.
It is striking, finally, that Mr. Vogel’s letter provides an example of one of my points concerning the distinctive qualities of the American Left. His comments generally speak of opposition to business, yet his indicated antipathy to “private economic accumulation” suggests a deeper questioning of capitalism itself. Yet he does not clearly say so, an instance, perhaps, of the typically populistic ambiguity of American leftists in failing to specify how fundamental their quarrel with the business community actually is.