‘Union Power and the New Inflation’, p. 65.21 21. John Davenport, ‘How to Curb Union Power’, Fortune, vol. 84, no. 1, July 1971, pp. 52–6 (p. 52).
22 22. See John Logan, ‘Employer Opposition in the US: Anti-Union Campaigning from the 1950s’, in Gregor Gall and Tony Dundon (eds.), Global Anti-Unionism (London: Palgrave Macmillan, 2013), pp. 21–38.
23 23. Quoted in Robert A. Georgine, ‘Statement of Robert A. Georgine. President of the Building and Construction Trades Department, AFL-CIO’, in Pressures in today’s workplace: oversight hearings before the Subcommittee on Labor-Management Relations of the Committee on Education and Labor, House of Representatives, Ninety-sixth Congress, first session, hearings in Washington, D.C. on October 16, 17 and 18, 1979, vol. 1 (Washington, DC: US Government Printing Office, 1979, pp. 408–35 [pp. 411ff]). I am here putting together a composite narrative that draws on different texts.
24 24. Ibid., p. 412.
25 25. Ibid.
26 26. Ibid.
27 27. Quoted in ibid., p. 419.
28 28. Quoted in ibid., p. 423.
29 29. Quoted in Georgine, ibid., p. 421.
30 30. These words were recorded by journalist Nancy Stiefel, who, armed with a tape recorder, managed to infiltrate a meeting organized by the law firm Jackson Lewis, Schnitzler and Krupman on the art of fighting unionization. Quoted in James Farmer, The hired guns of de-unionisation, Keynote Address by James Farmer Public Sector Labor Law Conference Spokane. Washington March 10 1979, reprinted in Pressures in today’s workplace: oversight hearings before the Subcommittee on Labor-Management Relations of the Committee on Education and Labor, House of Representatives, Ninety-sixth Congress, first session, hearings in Washington, D.C. on October 16, 17 and 18, 1979, vol. 2 (Washington, DC: US Government Printing Office, 1979, pp. 269–80 [p. 274]).
31 31. Quoted in Georgine, ‘Statement of Robert A. Georgine’, p. 433.
32 32. Ibid., p. 415.
33 33. Alfred T. DeMaria, How Management Wins Union Organizing Campaigns (New York: Executive Enterprises Publications, 1980), p. 15.
34 34. Ibid., p. 209.
35 35. Ibid., p. 95.
36 36. Ibid., p. 96.
37 37. Ibid., p. 153.
38 38. Ibid., p. 126.
39 39. Ibid., p. 130.
40 40. Ibid., p. 148.
41 41. Quoted in Georgine, ‘Statement of Robert A. Georgine’, p. 408.
42 42. Martin Jay Levitt, Confessions of a Union Buster (New York: Crown Publishers, 1993), p. 1.
43 43. Georgine, ‘Statement of Robert A. Georgine’, p. 408.
44 44. Quoted in ibid., p. 414.
5 A THEOLOGICAL CRISIS
The capitalist process, by substituting a mere parcel of shares for the walls of and the machines in a factory, takes the life out of the idea of property. […] Dematerialized […] ownership does not impress and call forth moral allegiance as the vital form of property did. Eventually there will be nobody left who really cares to stand for it – nobody within and nobody without the precincts of the big concerns.
Joseph A. Schumpeter1
‘It may not be saying too much to assert that the new thinking about collective enterprise, or managerialism, is about to be recognized as constituting a great theological crisis, on the order of the one that accompanied the introduction of Darwin’s work, or even the social and political thought that followed the Reformation. For we are experiencing the collapse of the economic and political pillars of the ideology which has dominated Western thought for the past several hundred years’.2 The decisive intellectual event in this respect, as the author of these lines said in 1962, had been the publication, three decades earlier, of a book co-authored by the lawyer Adolf Berle and the economist Gardiner Means, The Modern Corporation and Private Property.3 This work, which John Kenneth Galbraith considered to be one of the two most important books of the 1930s, with the General Theory of Keynes,4 did in fact polarize debates on the theory of firms for nearly half a century.
A few weeks after its release, however, its publisher, a small house specializing in tax issues, suddenly had second thoughts and withdrew it from sale. A General Motors executive, horrified by what he had read, had expressed his disapproval to the officials of the Corporation Trust Company, a business consulting agency whose publishing wing was one of the subsidiaries, and of which General Motors just happened to be one of the big customers – the kind of customers that it is always a pity to lose. As Berle comments, looking back on the affair: ‘Discovering the viper they had nourished in their corporate bosom, publication was promptly suspended after a few copies had been sold. (Copies under that rubric are – modestly – collectors’ items now.) […] Books questioning power systems – as did The Modern Corporation – often do have initial rough handling by the power system whose rationale and bases are analyzed’.5 This attempt at censorship in fact produced the opposite effect. Reprinted by Macmillan Publishing, the book was able to benefit from a much wider circulation. ‘Ironically, General Motors, […] was responsible for launching Berle and Means’s book’, as a conservative intellectual lamented some years later.6
What was so disturbing about the work? Its authors highlighted an unnoticed transformation in property rights, a revolution that led to the undermining of the principles of the capitalist economy as it had been justified for almost three centuries by its defenders.
Imagine a horse and its master. ‘The owner of a horse is responsible for it. If the horse lives he must feed it. If the horse dies he must bury it’.7 What about another relationship, that between a shareholder and the company of which he owns shares? ‘No such responsibility attaches to a share of stock’. The shareholder is not responsible for the company. Often, he has not even set foot on its premises. He has become, in the words of Thorstein Veblen, an ‘absentee owner’.8 He no longer has the physical possession of a property, only that of a ‘title deed’ – a dematerialized, abstract property, a paper property.
The old property-possession was solid. It immobilized the owner, who lived in the landscape of his ‘thing’. The shareholder, however, is without ties. If his property no longer suits him, he liquidates it. This represents a dematerialization, a fluidification and also a splitting of shareholder ownership, with the shares of a corporation being scattered between thousands of shareholders.
But something else also happens: ‘there has resulted in the dissolution of the old atom of ownership into its component parts’.9 The functions that private property had traditionally brought into a whole were split into two: ‘the power, the responsibility and the substance which have been an integral part of ownership in the past are being transferred to a separate group in whose hands lies control’.10 The shareholder now has only a passive property, and it is salaried managers, non-proprietors, who are now responsible for the active control of the company, its concrete management. So we have, on the one hand. ‘owners without real control’ and, on the other, ‘control without real ownership’.11 This is the main idea put forward by Berle and Means, that
