Adapt or Die?

I was reading an interesting review of an interesting-sounding book (Brian D'Agostino,"Tribute to Seymour Melman: Review of After Capitalism: From Managerialism to Workplace Democracy" Z Magazine, March 2005, pp. 58-60. subscription required) which argues that managerial (i.e. US-style) capitalism is in decline. Partially this is a result of the"permanent war economy" (a term which D'Agostino notes was coined by Melman) drawing resources into underproductive activities. But, more to the point, it is a cultural decline, as post-capitalist"workplace democracy" systems outcompete the smoke-and-mirrors shell game which fluffs up our economic numbers and our CEO pay:

Many of the countries from which the U.S. now imports goods and services pay their industrial workers higher hourly compensation than the United States [ed. and also offer a more generous social welfare system] ... These countries maintain advanced machine tool industries, and invest their profits in state of the art production equipment and methods, including more worker involvement ... corporate leaders in these countries seek to maximize profits by increasing productivity through both capital investment and a well-paid, motivated, highly skilled, and flexible work force.

In reality, the most advanced industrial societies, such as the Western Europeans and Japanese, are moving beyond the mental/manual split that still characterizes U.S. managerial thinking. In these societies, managers think about production, workers have increasing input into management decisions, and both collaborate to effectively introduce and operate new technologies. In Europe, labor unions are playing a central role in moving industrial affairs in this direction. Also, the most advanced U.S. enterprises, such as the Harley Davidson company [ed. -- !], operate on these same principles of workplace democracy.

Moreover, those sectors of the information economy that actually produce wealth, such as health care, education, and engineering, are experiencing a proletarianization of white collar workers, who are beginning to organize. Doctors and nurses facing exploitation from HMO managers, part-time professors who make up an increasing percentage of university faculties, and computer professionals and engineers whose jobs are being exported to low wage countries are are all discovering the merits of unionization and collective bargaining.

This is certainly a challenge to the"stagnating pseudo-socialism" narrative which is more common when discussing world economic affairs. I'm sympathetic to this argument: one of the things I have tried to do in the past is to complicate for my students the nature of the corporation as a social phenomenon. In Japan, in particular, corporations are not purely bottom-line operations, but are more openly cognizant of the way in which they are social entities and communities (well, that's less true now than it used to be, but it's still more true than not). And I'd like to see a social system in which people's decision-making was not entirely based on their functional position, but which took social and long-term costs into account. The critique of managerial capitalism seems pretty strong, though admittedly it's a sitting duck.

But neither Melman nor D'Agostino address the fact that the"end of capitalism" has been declared far too often for anyone to take it at face value. Capitalism has proven to be difficult to either define or defeat definitively, as it has a tendency to adapt. Or rather, people have a tendency to adapt: one of my problems with even a really good systemic analysis (and this looks like a candidate) is the tendency to entirely depersonalize the process, to overlook individual agencies which do not fall neatly into overdetermined paradigms [ed -- what? Oh, people don't always do what you expect them to, is that it? If you're going to use jargon, at least use jargon that saves word count, OK?]. Those adaptations include such positive innovations as unionism and what Melman (over-optimistically, in my opinion) calls"workplace democracy" as well as outsourcing, union-busting, Mergers&Acquisitions, etc.

In fact, it's not entirely clear to me that"workplace democracy" is in any meaningful sense post-capitalist, though it certainly isn't Wal-mart-ism. Rather, it strikes me as a variation on the same adaptation that scotched Marx's original predictions on the imminent end of capitalism: expanding middle-class membership and leadership instead of expanding polarization/oppression.

Another flaw in this argument has to do with competition: I will grant that the US economy includes massive unproductive sectors -- financial market speculation (which is very different from investment), and"overkill" military investment (there's a whole other discussion there about the role of militaries in past and present economic systems, and the common-sense problem of the necessity of defense and, at times, force projection) -- and that we overestimate our own productivity, viability and attractiveness to the world considerably, but it's also true that the US military-capitalist model has tactical advantages in the short- and medium-term with regard to competition for markets and for resources such that -- in the absence of an actual collapse of the system -- it seems likely to beat out systems with long-term strategic strengths. That's not a call for surrender: rather, it's a plea for continued analysis of the systems (preferably without the"winner-take-all" triumphalism which characterizes way too much economic analysis), realistic assessment of the social, personal and environmental costs and benefits, and continued pressure on political and economic (and cultural) leaders to adopt long-term horizons for policy evaluation.