The Capitalist Class Starts its (Re)education

Representatives of the US capitalist class used to be famous for stomping all over the world, putting their feet up on other’s desks and, cigar in mouth, handing orders down to their counterparts in other countries. At home, they believed that there was no labor problem that could not be handled by court orders at the least and police batons and hot lead whenever necessary. As far as the economy, they believed that there was no need for state intervention whatsoever.

Then they received an education.

1930s & Aftermath
In 1929 their economy collapsed and the old “laissez faire” (“leave it alone”) economic policy only allowed a bad situation to get worse. Equally shocking, the working class rose in such numbers and with such determination that it was not possible to crush their movement with brute force. The fact that there were two anti-capitalist political parties with a significant base in the working class (the Socialist and the Communist Parties) also played a role. Although he was generally hated by the capitalists, Franklin Delano Roosevelt realized that he must make concessions to the workers in order to save the bacon for his class – the capitalist class.

The workers’ movement made a partial retreat during WW II and the capitalist class attempted to return to the pre-1929 situation after the war. The response was the biggest strike wave in US history in 1946. This convinced them that a new approach was necessary. Thus was the period of relative labor peace and concessions to major sectors of the working class born.

Capitalists Return to Offensive
However, as the post WW II period of prosperity collapsed and US capitalist domination weakened (mid 1970s onward), the employers started to return to the offensive — hesitantly at first, but with increased aggression and confidence as they repeatedly saw the weakness, short-sightedness and timidity of the US labor leadership in action.

There were always layers of the capitalist class who had never really learned the lessons of the 1930s and the 1960s (the days of the youth movement as well as the revolt of black people). Over a series of decades, these layers of the class increased their influence. This was expressed as well in foreign policy, where the George Bush presidency gave it its fullest expression.

Obama – A More Balanced Approach
Obama’s installation into office represented a new approach to international relations, the importance of which was recognized by world capitalism by his being awarded the Nobel Prize for peace before his even having accomplished anything. However, in terms of class relations domestically, little if anything has changed… yet. The unbridled plunder of the state by the capitalist class has accelerated, if anything, under Obama.

The problem for the capitalist class is that, in installing a president who is intelligent and less narrow in his vision, and having installed him in a time of economic crisis, they now find him saying some things that are not to their liking. Thus have developed some tensions between Obama and his administration vs. the tops of the capitalist class. Neither side is happy with these tensions, and attempts are being made to resolve them. A clear example of this was seen at a recent conference of the Wall St. Journal’s CEO Council. Largely hidden from public view, members of this council are CEOs of the US’s top corporations, representing some $2 trillion in value. Top politicians from both parties appeared at the conference. These included Sen. John McCain (the Republican) and Rahm Emmanuel. Emmanuel, Obama’s chief-of-staff is probably the single most important member of Obama’s administration, having a daily direct contact with the president. He served as the president’s stand-in, having the advantage that his presence would not attract the public attention that the president’s presence would have.

Gerald Seib Warns the Capitalists
While reports of the results of this conference are still forthcoming, some initial comments bear thought. Gerald Seib, one of the Wall St. Journal’s most thoughtful commentators, and one who serves as far more than just a cheer-leader for the capitalist class, wrote an extensive column on this conference (WSJ, 11/20/09). It should be emphasized that Seib is the WSJ’s Washington bureau chief and as such carries a lot of influence in the capitalist class. He opened his column by quoting Rodney King (of LA police brutality fame): “Can we all just get along?” and commented that this should be applied to relations between the Obama administration and the “business community.”

He described the attitude of these CEO’s: “The magnitude of the economic crisis was becoming clearer, and the business leaders were virtually leaning forward in their seats, seeking help and reassurance,” from the administration.

Despite this, the “business community” (i.e. the capitalist class) is so accustomed to having everything go its way, including the rhetoric that comes from the White House, that even the token words Obama has uttered continued to annoy them; they tended to blame Obama’s rhetoric itself for the anti-corporate mood that exists. First, Senator John McCain, certainly no opponent of Corporate America, was trotted out to warn them about the level of “popular anger” aimed at them. On top of this, one of the top members of their class, John Chambers, CEO of Cisco Systems, was brought forward to remind them that the administration was moving away from the anti-corporate rhetoric (which never was anything but rhetoric.) “To miss this opportunity (to reconnect with Obama) would be one we would look back on and say, ‘Shame on us,’ ” he said.

The task of Obama’s stand-in, Rahm Emanuel, was to reassure them. He explained that the American “people” feel “taken advantage of….In a democratic process somehow you’ve got to respond to that.” In other words, Obama is not stoking the anger; but he must respond to a widespread feeling; don’t worry, though, he doesn’t really mean what he says. In order to press the point home, Seib writes to his constituents (these CEOs): “In other words, acknowledging populist anger is a small price to pay for saving the financial system.”

Conference Future Goals
Sheib writes that three concrete goals emerged from the conference: One was “job creation”, meaning measures to boost profits. Another was “education reform”, meaning more privatization and further steps to improve the ability of the education system to produce more efficient, more profitable workers. The third was tackling the massive and growing budget deficit. He concludes with commenting on the need to “take shared political risks on spending and taxes. Business leaders — influential with both parties, but especially with the Republican opposition — should be part of the equation, throwing their weight behind the effort and politicians willing to take a chance.” In other words, there must be massive cuts in social spending, including cuts in social security and Medicare. So far, these have been a “third rail” for politicians of either corporate political party. Sheib, ever the strategist for the “business community” is calling on these CEO’s to enforce a little discipline on their parties (the Republicans and the Democrats) and see to it that none of the party leaders who call for such cuts will come under attack by their opponents who seek to make political hay from such calls in order to get elected.

So while the capitalist class is learning some lessons, at the same time they are being called upon to exercise some discipline within their own ranks. In the coming period, the movement from below – of youth and then of workers – will teach them even further lessons. More important, however, is how that movement will learn and grow itself.