Is there a Global Capitalist Class - Essay Example

Is there a global capitalist class? The transnational or global capitalist class concept has recently occupied the economic and political spheres particularly for those ones – authors, scholars, economists, humanitarian, politicians, academics, etc. – seeking to challenge the dominant neo-realist approach in the study and analysis of the global political economy. This global capitalist class is said to be decreasingly identified with a particular location or country and retains little interest in the provision of public welfare goods by national states since these can easily be provided privately, while global communication networks widen location choices. There is allegedly in a real sense no longer a necessity to be a member of a society as characterized by a specific national terrain and political system. One sees an example of this supposed emergent class in Christopher Lasch (1995) description of the typical American ruling elite: To an alarming extent the privileged classes by an expansive definition, the top 20 per cent have made themselves independent not only of crumbling industrial cities but of public services in general. They send their children to private schools, insure themselves against medical emergencies by enrolling in company supported plans, and hire private security guards to protect themselves against mounting violence against them. In effect, they have removed themselves from the common life. It is not just that they see no point in paying for public services they no longer use. Many of them have ceased to think of themselves as Americans in any important sense. (p. 45-46) This paper will explore whether a transnational/global capitalist class has indeed emerged and particularly, its sociological implication will be examined. Leslie Sklair's theory on the subject will be thoroughly referenced, as the discussion of this paper will take a more sociological than economic approach to the development of this class. Background It was Marx along with Engels (2001) who has first suggested the global nature of capitalism and the vision that the bourgeoisie will try to expand its reach around the world in their most famous work, The Communist Manifesto. “The need of a constantly expanding market for its products chases the bourgeoisie over the whole surface of the globe... It must nestle everywhere, settle everywhere, establish connections everywhere.” (Marx and Engels, p. 476) In the Marxist perspective, the capitalist class is organized through distinct political boundaries of nation-states. The competition among capitals that is inherent to the system therefore takes the form of competition (as well as cooperation, depending on the circumstances of the moment) among capitalist groups of different nation-states and is expressed as interstate competition, rivalry, and even war. (Robinson p. 45) After Marx, a number of economists and sociologists have introduced a plethora of concepts that examine the possibility of class formation particularly during the advent of globalization. William Robinson wrote that an analysis of transnational class formation starts with the primacy of social relations of production in the constitution of antagonistic classes and with the derivation of specific classes or class fractions, such as a TCC, from struggles grounded in these relations. But we go back to the Marxist perspective in class analysis since this paper will not focus on the economic dimension of the subject. It appears impossible to understand society without an examination of class. While class analysis does by itself explain the various levels of social structure and that it is complex, it complements and enriches, rather than replaces, other kinds of analysis, like gender analysis or ethnicity. An examination of the rise of a new global ruling elite is pivotal in understanding social relations and their impacts. Marx, in his analysis of class, clearly identified class as a collective position vis-à-vis the means of production and the production process. But he also proposed that class exist on condition that its capacity to forge a collective political and/or cultural protagonism, that is, a self-representation and that class formation involves the mutual constitution of antagonistic classes. This underscores the sociological context of the whole discourse. To borrow Robinson’s words, class formation involves collective agency in the Marxist school of thought. Robinson used Marx’s a class-in-itself and a class-for-itself analogy in order to illustrate the point: A class-in-itself is a group whose members objectively share a similar position in the economic structure of society independent of the degree to which they are aware of their collective condition or to which they consciously act on the basis of this condition. A class-for-itself is a class group whose members are conscious of constituting a particular group with shared interests and would be expected to act collectively in pursuit of those interests. (p. 38) This class analysis therefore involves structural and agency, or objective and subjective, levels of analysis. The first is about the material bases as well as the production relations that give rise to and define classes. Finally, the second pertains to the intentionality and the forms of consciousness that are involved in the intervention that shape social processes and as well the direction of development in material relations. Sklair and the Transnational Capitalist Class (TCC) One of the most authoritative and widely referenced sociologists that have extensively discussed the transnational or global capitalist class is Leslie Sklair (2001). He was in fact responsible for the transnational capitalist class (TCC) concept, as we understand it presently. In recent years he has written broadly about this in his theory of global system with the global/transnational capitalist class as a fundamental element. In using his theory – the global system theory – as an approach to globalization, Sklair limited the scope of his discourse to the technological, economic, political and culture-ideology innovations that began to change the world in the second half of the twentieth century. (p. 4) Here, he was able to differentiate his global system from global capitalism. It is important to expand on this theory in order to understand Sklair’s perspective on the emergent global capitalist class. According to him: The global system theory… is based on the concept of transnational practices, practices that cross state borders but do not originate with state agencies or actors. Analytically, they operate in three spheres, the economic, the political, and the culture-ideological. The whole is what is meant by the global system… Global system theory sets out to explain how the system works, to show how the transnational capitalist class copes with the crises it produces, and to predict some likely outcomes. (p. 4-5) Here, the global mobility of capital and the reach of transnational corporations has fostered the growth of a transnational capitalist class. Sklair set out four propositions on the transnational capitalist class: 1. A transnational capitalist class based on the transnational corporations is emerging that is more or less in control of the processes of globalization. 2. The TCC is beginning to act as a transnational dominant class in some spheres. 3. The globalization of the capitalist system reproduces itself through the profit-driven culture-ideology of consumerism. 4. The transnational capitalist class is working consciously to resolve two central crises, namely (i) the simultaneous creation of increasing poverty and increasing wealth within and between communities and societies (the class polarization crisis) and (ii) the unsustainability of the system (the ecological crisis). (p. 5-6) Sklair differentiated global system from global capitalism. The former appears to be broader but that both concepts demonstrate the dominant forces of capitalism are also the dominant forces in the global system. For Sklair, the global capitalist class is one of the building blocks of the global system and global capitalism, particularly in the political and cultural-ideological sphere. Sklair’s arguments involve the idea of the global capitalist class as a new class that brings together several social groups: the executives of transnational corporations, or TNCs; globalizing bureaucrats, politicians, and professionals; and, consumerist elites in the media and the commercial sector – sectors with insatiable desire for profit. (p. 4) Specifically, they are divided into four class fractions: the TNC executive and their local facilities (the corporate fraction); the globalizing bureaucrats and politicians (state fraction); globalizing professionals (the technical fraction); and, the merchants and media (the consumerist fraction). (p. 17) To some extent the exact disposition of these fractions and the people and institution from which they source their power and influence within the global system may differ according to time and locality. For instance, in order to explore globalization in a particular state, it makes sense to pair globalizing bureaucrats and politicians, and that for other issues a different partnership may be required. Here are some specific examples of the TCC: The CEO: Up to the mid-1990s, the CEO was considered to be a member of the upper middle class but that in recent years, in the global systems theory, the CEO is considered to be the chief member of the transnational capitalist class – the sector of the world bourgeoisie representing transnational capital. Through the CEO the TCC “manages the globalized circuits of accumulation which give it an objective class existence and identity spatially and politically in the global system above any local territories and polities.” (p. 67) The CEOs’ inclusion in the global capitalist class makes them members of the global power elite controlling the global market from their perches in financial centers around the world such as London, New York and Tokyo. Organizations: The World Bank, the International Monetary Fund, the USAID, among other organizations with related mandate are members of the transnational capitalist class. For years, these organizations have imposed their own economic policies on Third World countries. Although a majority of transnational corporations’ investment in the Third World countries are consisted of well established companies producing very much like domestic companies mainly for the local market, the emphasis since the 1960s has been on TNCs locating or relocating in the Third World in order to take advantage of the cheap labour for some form of export processing. (Sklair 1994, p. 168) Sklair’s more sociological approach in explaining the existence of transnational/global capitalist class predominantly stress the structural power of transnational capital, emphasizing links to politics, the professions and the media-culture complex. He emphasized the formation of a historically unprecedented global capitalist class that emerged from transnational corporations in the backdrop of the globalization phenomenon, which is responsible for the significant erosion of national economic, political and cultural boundaries. Specifically, the TCCs for Sklair are transnational or have globalising power because: First, the economic interests of its members are increasingly globally linked rather than exclusively local and national in origin; second, the TCC seeks to exert economic control in the workplace, political control in domestic, international and global politics, and culture-ideology control in every-day life through specific forms of global competitive and consumerist rhetoric and practice; third, members of the TCC have outward-oriented global rather than inward-oriented local perspectives on most economic, political and culture-ideology issues; fourth, members of the TCC tend to share similar life-styles, particularly patterns of higher education, and consumption of luxury goods and services; finally, members of the TCC seek to project images of themselves as citizens of the world as well as of their places and/or countries of birth. Indeed, William Robinson wrote that in conceiving the capitalist class as increasingly less tied to territoriality or driven by national competition, focus must be on the national bourgeois classes that converge externally with other national classes at the level of the international system through the internalization of capital and, concomitantly, of civil society. (p. 36) Here, the formation of a world ruling class is seen as the international collusion of these national bourgeoisies and their resultant international coalitions. As stated previously, in Sklair’s examination of the formation of the capitalist class, globalization is a fundamental element and that it is founded on the development of global corporate concepts such as best practice, benchmarking as well as corporate citizenship and even concepts such as social responsibility, among other minor ones. To illustrate, when presented with the problem of global warming, solutions or responses are relegated to corporate planning groups as some form of acknowledgment of the sustainability discourse and the complicity of global capitalism. The importance of trade and globalization in the discourse of the TCC is highlighted by the statistics concerning international trade: For most of the postwar period, World trade has grown much faster that world output, and significantly so since the 1990s… Trade now involves a larger number of countries and sectors than any time in the recent past, while developing economies today account for the growing share of world export markets… Trade now reaches deeper into more sectors of many national economies as an expanded array of goods and services have become tradeable. (Sklair 2001, p. 74-75) Also, the number of transnational corporations have increased from 7,000 in 1970 to 37,000 in 1993, 53,000 in 1998, and more than 60,000 by 2000 and that they have accounted for some two-thirds of the world trade. (Robinson, p. 55) In addition, the business nexus of the culture-ideology of consumerism, according to Dieter Plehwe, Bernhard Walpen and Gisela Neunhöffer (2006), may be considered as the most important pillar of transnational class power because it provides the single dominant lifestyle concept characterizing the contemporary world-systems, with only possible challenge coming from some versions of religious fundamentalism. (p. 9) There is an ambiguity on how a transnational capitalist class exists and how they operate with some maintaining that it is simply how corporations rule the world while some argue that global governance is a tool for this global entity. Nonetheless, according to David Held and Anthony McGrew, the world we are in today is a “site of struggle that harbours the political potential for mitigating, if not transforming, relations of domination in the existing world order.” (p. 148) Criticisms Unarguably, Sklair presented us with a straightforward and systematic analysis of the global capitalist class. However, one finds certain contradictions in his arguments. Phlewe, Walpen and Neunhöffer gave us an example: Sklair emphasizes that the Business Council for Sustainable Development has successfully replaced obstructionist business strategies in the ecological battlefield. Thus, the business forces behind the US efforts to block the Kyoto protocol (the Global Climate Coalition, for example) would have to be identified as members of a national capitalist class faction in Sklair’s framework, regardless of the size and investment patterns of such companies and regardless of their countries of origin. But many a big business leader representing giant capital interests which clearly fall in Sklair’s category of transnational enterprises both outside and inside the US supports the US position rather than the arguably more enlightened position of the Business Council. (p. 10) Furthermore, Sklair included a brief rebuttal of the postimperialism thesis – that one presupposing a mutual exclusivity of capitalism and socialism. However, he did not touch nor does he appear to consider or anticipate the important resistance to transnational corporate investment. One should note that Sklair's point focuses on a class struggle on a global scale against the culture-ideology of consumerism. David Becker and Richard Sklar (1999) argued that from this standpoint, which underpins his (Sklair’s) entire analysis, he offered a one-dimensional view of the communications industry as a propaganda tool for the global capitalist project, as if its chief purpose were ideological rather than economic. (p. 20) This supposedly minimizes the plausibility of Sklair's analysis. The authors explained that when theories of social class, such as those by Sklair, lack plausibility, elite theories are always at hand to explain inequality as a functional requirement of institutions. For them corporations are changing not into some new emergent class but instead into the so-called 'enterprise webs,' which is defined as the “combinations of skill under the direction of persons with 'strategic insight.' Even the function of managerial control... is being replaced by 'strategic brokering.' In an enterprise web, no one exercises power. Strategic brokers do not issue commands; they facilitate outcomes.” (p. 21) Another important point that critics raise about Sklair’s perspectives on the transnational capitalist class is that it supposedly ignored the military industrial complex (MIC). The significance of the MIC economically, politically and socially lies in its coercive capability. Its implications can be felt through military interventions by powerful countries in weaker states. If we go back during the Clinton administration in the America, we have examples in the US military excursions in Somalia, Kosovo, among others. If we observe closely, the United States had no clear or direct interest from this military strategy, whether economic or in the area of security. However, if we observe from the TCC perspective, it would be easy to suggest that the capitalist class was able to force the United States government to intervene in a conflict that would not benefit the state but instead achieve for them a certain degree of stability in a region that the TCC want to operate in or maintain security in a locale they are in. The idea that these forces desire and impose upon countries a more stable and managed economic order is not impossible but a fact. The American involvement in Kosovo, the IMF and the World Bank’s control over Third World countries – these are just some examples that show powerful a group of capitalist could become. So if we assume that the emergent capitalist class could, indeed tap the military industrial complex, it would radically change how the game is played and presented to us by scholarly pieces such as those expounded by Sklair. The body of literature that examines Sklair’s claims about the TCCs and the TCC by itself seem to agree that Sklair’s arguments make sense. Whatever criticisms available, they were mainly about gaps and how Sklair’s positions could be modified in order to comprehensively cover all possible variables that would support the supposition that the transnational capitalist class indeed exist now in our midst. And so, let us consider the impact of such development in society from the sociological perspective. Sociological Impact David Held and Anthony McGrew outlined the negative effects of the emergence of the global capitalist class. According to them there is now a constant need to expand and reproduce the global markets as seen in the activities of the World Trade Organization. To quote: The priorities of the liberal global governance have become increasingly dominated by the need to extend, promote and secure the effective conditions for continued economic globalization… The growing emphasis on good governance, democracy and where necessary humanitarian intervention – what some referred to as global ‘riot control’ – represents attempts to stabilize world order around the liberal capitalist model. (p. 148) This was supported by Sklair in his other book, The Transnational Capitalist Class. He stressed that: The corporate, political, professional, and consumerist elites in Third World countries want to keep their own private communities clean and safe and to protect those parts of their own countries that are special to them. Lucrative exploitable resources may be more likely to be developed in Third World countries than elsewhere because the people who occupy the land are not the elites in these places. As we have seen, such developments tends to intensify more than resolve the ecological crisis for most populations and for most habitats (the effects on the class polarization crisis are not so clear-cut). (p. 249) This has been what Lasch has detailed as stated in the first part of this paper. Held and McGrew acknowledged that such trend brought about by the conglomeration of a global capitalist class and its pursuit to preserve and expand itself is at the expense of the effective global action to combat the “accelerating gap between rich and poor through redistributive mechanisms, from official aid to technical assistance.” (p. 148) In addition: Others values are excluded (e.g. equality or human rights Liberal economics always win in favor of the Western global capitalist class at the expense of the welfare of smaller nations. I would like to explore more about the inequality that come as a result of the creation and activities of the transnational capitalist class through their main institutional form – the Transnational corporations. The magnitude of the changes that the TCC, wrote Boaventura de Sousa Santos (2002), are bringing about in modern business can be seen from the fact that more than one third of the world’s industrial output is produced by these corporations. (p. 168) Hence, it seems inevitable that they dominate the world economy and that the degree and efficacy of centralized directions they manage to achieve, distinguish them from older forms of international business enterprise. Now, the effect of the TCCs and their institutional forms on new class formations and on world-level inequality looks very potent, although widely debated in recent years. De Sousa Santos referred to Evans’ dependency theory as he analyzed the triple alliance of TNCs, the elite local capital and what he called as the state bourgeoisie, the sector seen at the base of the dynamic industrialization and growth of a semi-peripheral country like Brazil. (p. 168) Here, based on Evans’ triple alliance, the issue of world-level inequality the situation is considered as inherently inequitable and capable of only one kind of redistribution ‘from the mass population to the state bourgeoisie, the multinationals and the state local capital. The maintenance of the delicate balance among the three partners militates against any possibility of dealing seriously with questions of income redistribution, even if members of the elite express support for income redistribution in principle.’ (Evans 1979, p. 288) What these mean is that wealth distribution represents a much lower share of national income particularly in smaller economies. The dominance of the TCCs have rendered the human and institutional embodiments of labour incapable of political, economic and ideological power. The transnational capitalist corporations have also managed to force countries into working a pre-emptive strategy in regard to the discourse on labour and the transnational processes that cover any possible future attempts to claim labour rights and assert such powers. This is underscored by the fact that the top transnational companies employed directly 70 million workers worldwide and that these workers produce one-third of the world’s total private output. (Castells 2000, p. 251) Opposition A reaction to the growing power and influence of the global capitalist class is the emergence of anti-globalization or anti-global capitalism. In Held and McGrew’s words, one gets a clear idea of what their objectives are: Mobilizing both local and global action, the movement has made use of direct action, transnational campaigns and the politics of protest to bring to the world’s attention the subordination of human and ecological security to the interests of global capital or US hegemony. (p. 149) As it is, global capitalist class would often find itself opposed by vocal coalitions when it attempts to force its will over peoples, over old and new ways. It is easy to understand how each of the economic, political and culture-ideology victories throws up mass movements challenges the hegemony of a global capitalist class. Opposition to capitalism permeates – from households to communities and cities, all the way up to and beyond the level of the nation-state. We can see this in capitalist societies. They are mostly characterized by movements for social democracy which have led to many uneasy alliances between those who are hostile to capitalism as well as those who struggle to alleviate its worst consequences, and those who simply want to ensure that capitalism works with more social conscience if not more than at least on par with what the so-called free-market allows. Nonetheless, it is important to note that numerous case studies of how environmental problems have been handled in the top 500 transnational corporations demonstrate how and why, even under constant threat to its existence, the transnational capitalist class has managed to defend itself, prosper, and organize in order to secure its future. (Sklair, p. 296) However, Sklair suggested that resistance to global capitalism could be successful. According to him, this can be done by disrupting the TCC’s smooth operations – that of accumulating private profits and claims of hegemony). (p. 296) There is no shortage of cases wherein the global capitalist class or the global capitalist system have been challenged. They can be disrupted and forced to change their practices and to compensate those whom they have affected. What is interesting is that a significant number of these disruptions have been due to local campaigns that have generated publicity of global proportions. Sklair also tend to forget this variable. Workers, citizens, feminist, religious, and other concerned groups and organizations in communities all around the world can and zealously monitoring the capitalist class' activities, forcing them to act responsible and create policies that have positive effects, socially. Conclusion As presented by this paper, class does operate in the global economy. Globalization has much to do with it because it is a process by which capitalist elite could extend their power. The economic freedom that permeates in a globalized world entails the spread of the free market wherein the capitalists gain from trade and, especially, from the flow of capital across borders. It is widely accepted that globalization is not merely an economic process but it is a political and social phenomenon as well. The transnational class formation is inevitable. What we have right now – an evolving global production system – it is redefining the relation between production and territoriality. Here, nation-states, economic institutions and social structures are affected and that they are modified because each of the national economies around the world must be reorganized for its integration into this new global production system. Presently, a transnational capitalist class is getting more and more tangible in shape. Here, we may hear people raising questions about nuance: the old and the new; because international bourgeoisies can be considered to be as old as capitalism itself. However, this paper has established that the new transnational capitalist class is different from the old cadre of international merchants. As Leslie Sklair put it, this new elite are executives, financiers, bureaucrats, professionals and media moguls. They primarily aim to globalize forms of capital. That is why business investments and ventures are not national enterprises even though capitals may enter and exit national economies in varying frequencies. “The entrepreneurial activities of this class are conceived in terms of markets, monetary transactions, and modes of manufacture that transcend national borders. They seek to disengage from parochial loyalties and jurisdictions, thus to minimize the effects of legal regulations, environmental constraints, taxation, and labor demands.” (Edelman and Haugerud 2005, p. 182) This is the reason why the transnational capitalist class is considered a negative development in sociological discourse. Globalization and international trade forces national governments to surrender certain degree of sovereignty, which in turn empower the TCCs to operate, expand, enrich and prosper at the expense of the majority of the people. There are several cases – cases of intervention in Third World countries, labour policies, international trade regulations as promulgated by world trade bodies, etc. – that demonstrate how the transnational capitalist class aggravate problems of inequality, unequal wealth distribution, human exploitation and environmental damage. On the other hand, seen from the perspective of the poor and the middle class, the rise of the global capitalist class could be a positive development in the sense that it opens up new potentialities of resistance and emancipation. References Becker, D and Sklar, R 1999, Postimperialism and World Politics. Greenwood Publishing Group. Castells, M, 2000, The Rise of Networked Society. Blackwell Publishing. de Sousa Santos, B 2002, Toward a New Legal Common Sense. Cambridge University Press. Edelman, M and Haugerud, A 2005, The Anthropology of Development and Globalization: From Classical Political Economy to Contemporary Neoliberalism. Blackwell Publishing. Evans, P 1979, Dependent Development: The Alliance of Multinational, State, and Local Capital in Brazil. Princeton University Press. Fox, R and Fox, J 2004, Organizational Discourse: A Language-ideology-power Perspective. Greenwood Publishing Group. Held, D and McGrew, A 2007, Globalization/Anti-Globalization: Beyond the Great Divide. Polity. Lasch, C 1995, The Revolt of the Elites and the Betrayal of Democracy. New York: Norton. Marx, K and Engels, F 2001, Communist Manifesto. New Albion Press. Robinson, W 2004, A Theory of Global Capitalism: Transnational Production, Transnational Capitalists, and the Transnational State. JHU Press. Sklair, L 2001, The Transnational Capitalist Class. Blackwell Publishing. Sklair, L 2000, The transnational capitalist class and the discourse of globalization. The Global Site. Available from: Sklair, L 994, Capitalism and Development: Immanuel Wallerstein and Development Studies. Routledge. Plehwe, D Walpen, B and Neunhöffer, G 2006, Neoliberal Hegemony: A Global Critique. Taylor & Francis. Read More