Democracy

The Megapower Elite

“Power is the ultimate aphrodisiac.” Henry Kissinger, 1973

I recently returned to teaching selections from C. Wright Mills’s 1956 book, The Power Elite. The book was written in the midst of unprecedented prosperity in America, what economists Claudia Goldin and Robert Margo have called “the great compression,” when the levels of social inequality that peaked in 1929 and muddled through the next two decades were lowered and stabilized in the 1950s and 60s. It was the “good times” fifties. But Mills saw acutely that something had changed in America; that an unprecedented centralization of power “not before equaled in human history” had also been set in motion as the aftermath of World War II, whose continued development would undermine democratic institutions.

Mills claimed that “the Big Three” institutions—Corporate, Government, and Military—powered up into an interlocking directorate. Though he does not mention them, two coups of that era engineered by the CIA provide ample evidence of what Mills was describing. The overthrow of the Iranian government in 1953, which installed the Shah of Iran, was undertaken to secure British and American oil interests. Corporate oil, political, and military (particularly the burgeoning CIA) institutions realized their common interest in overthrowing the democratically elected regime of Mosaddegh. The long-term consequence was the empowerment of Islamic fundamentalism in the overthrow of the Shah in 1979.

In 1954 the CIA directed the overthrow of the democratically elected government of Guatemala, in order to keep the profits of United Fruit at their maximum. The secretary of defense, John Foster Dulles, his brother Allen Dulles, the head of the CIA, and the UN ambassador, Henry Cabot Lodge, Jr., all had investments in United Fruit, and as David Halberstam states in his book The Fifties: “The national security complex became, in the Eisenhower years, a fast-growing apparatus to allow us to do in secret what we could not do in the open. This was not just an isolated phenomenon but part of something larger going on in Washington—the transition from an isolationist America to imperial colossus. A true democracy had no need for a vast, secret security apparatus, but an imperial country did…What was evolving was a closed state within an open state” (p. 371). American power helped over one hundred thousand Guatemalans to be killed over the next decades.

Consider that the 1950s were also the years when big science jumped into center stage as the model for progress and development. Yet that process was hatched out of the secret atomic bomb Manhattan Project of the Second World War, which fostered a continuing alliance between science and the military. Science is inherently a public activity, open to the community of all possible inquirers. Secrecy is thus the enemy of science. So what do we call the military-funded, compromised activity that permeates Big Science and bequeaths its fruits to industry? Sci-tech?

When Mills published The Power Elite in 1956, the power of the powerful clearly was upsurging. But that decade also saw gains by workers as the legacy of the union struggles, and also a sense of corporate citizenship, both in levels of federal taxes paid by corporations and a commitment to long term worker employment that has been subsequently eclipsed. By the end of the 70s, newer centralizing forces began to emerge.

That power elite was eclipsed by today’s megapower corporate elite, which owes nothing to workers or locale or even production in America, even while corporations have been ruled “persons” by the Supreme Court, capable of money laundering electoral politics. The “War on Terror” has proven an excellent replacement for the Cold War as a source of funding for the military-industrial complex (the term first used by President Eisenhower a few years after Mills’s book). The post 1979 period is what Paul Krugman has called “the great divergence,” where, between 1980 and 2005, “more than 80 percent of total increase in Americans’ income went to the top 1 percent,” as Timothy Noah has noted in Slate Magazine. Corporate profits have soared in the 2007-2009 period, rising 720 percent, despite the great Recession!

The report, “The ‘Jobless and Wageless Recovery’ From the Great Recession of 2007-2009,” by Andrew Sum, Ishwar Khatiwada, Joseph McLaughlin, Sheila Palma of The Center for Labor Market Studies, Northeastern University, gives a chilling view of the Megapower elite now in command of the American economy. Earlier recession recoveries in the first six quarters are telling: in 1991 50 percent of the growth in national income went to wages and salaries while corporate profits fell by 1 percent, and in 2000-1 only 15 percent went to wages and salaries with 53 percent going to corporate profits. But in the current recovery: “…corporate profits captured 88 percent of the growth in real national income while aggregate wages and salaries accounted for only slightly more than 1 percent…Aggregate employment still has not increased above the trough quarter of 2009, and real hourly and weekly wages have been flat to modestly negative. The only major beneficiaries of the recovery have been corporate profits and the stock market and its shareholders.”

Mills’s concluding sentences strike home in today’s Megapower Elite America, where consumer identity and its values of exclusive distinction have eclipsed the broader sense of citizenship as involving inclusive commonality. “Those who sit in the seats of the high and mighty are selected and formed by the means of power, the sources of wealth, the mechanics of celebrity, which prevail in their society… They are not men shaped by nationally responsible parties that debate openly and clearly the issues this nation now so unintelligently confronts. They are not men held in responsible check by a plurality of voluntary associations which connect debating publics with the pinnacles of decision. Commanders of power unequaled in human history, they have succeeded within the American system of organized irresponsibility.”

  • http://www.deliberatelyconsidered.com Jeffrey C. Goldfarb

    Re-reading The Power Elite certainly provides insight into a major problem in American society today, suggesting a reversal of Marx. First time comedy (capture in recent tv programs, Mad men and its imitators), now tragedy. I am not completely convinced by the idea of a power elite or now of a mega power elite. The closely interlocked nature of the elite that Mills presented and Halton suggests, I think, is an exaggeration. Yet this exaggeration does highlight a fundamental problem and can motivate critical action, such as the demonstrations on Wall Street. Something which I hope will be discussed deliberately at DC.

  • Anonymous

    This is very interesting. What I take away from it is the deep question of the extent to which our (or any superpower’s) economic interests determines our foreign policy. And, of course, the fact that these economic interests are shared by powerful leaders and corporations– in short, if United Fruit as our company determined our handling of countries in Central America, and it did or our interest in cheap oil led us to get rid of a democratically elected leader in Iran, and it did, then we really do live in a corporate oligarchy. And I understand the distinction you make between now and then (and least then we had a progressive reaction or the creation, at home, of unions, etc.) whereas now corporate power has no resistance. There is resistance to corporate power and hopefully the resistance will result in the upkeep of unions, etc.

  • Scott

    I think it is an interesting question whether or not the “power elite” indeed act in tandem as a “united front.” Yet whether the power elite are closely interlocked or not, it seems that a system being rigged in their favor, via the influence of money in politics, has the effect of taking power out of the hands of everyday citizens, and undermining democratic processes. And like Dr. Goldfarb mentioned, this can motivate critical action such as people taking to the streets and creating their own power.

  • Eugene Halton

    Goldfarb claims that C. Wright Mills’s concept of power elite or my proposal for a megapower elite is an exaggeration, “Yet this exaggeration does highlight a fundamental problem and can motivate critical action, such as the demonstrations on Wall Street.” Presumably Eisenhower’s 1961 claim for “the military-industrial complex” would also be taken as an exaggeration (an interesting one if so, coming from the head of government and former general and supreme commander of allied forces in World War 2). So what is the exaggeration of the “fundamental problem” then, could you be more specific?

    Are the examples I offered of American sponsored coups in the 50s to illustrate Mills’s concept not evidence of strongly interlinked corporate, military, governmental institutions? Do you not see a centralization of power per se as problematic?

    Could it be that your concern for grassroots political action may be overshadowing the significance of larger scale systemic interconnections which Mills’s idea of the power elite tried to draw attention to?

  • http://www.deliberatelyconsidered.com Jeffrey C. Goldfarb

    As a matter of principle, I am the last one to recognize a conspiracy, for theoretical and political reasons. I know there are conspiracies, but try to find alternative explanations first. In the case of Mills and Halton’s notion of an interconnected elites, I see institutions interlocking, justified by ideologies and a political culture that have to some extent lives of their own. During the cold war, fighting communism justified actions that also protected American corporate interests, and it could even be given a human face with Rockefeller support through art shows abroad featuring abstract expressionists. (How New York Stole the Idea of Modern Art by Serge Guilbaut and Arthur Goldhammer). But that doesn’t mean that Jackson Pollock was part of the Power Elite. It is the intentionality of Mills notion that I question.

  • http://www.deliberatelyconsidered.com Jeffrey C. Goldfarb

    As a matter of principle, I am the last one to recognize a conspiracy, for theoretical and political reasons. I know there are conspiracies, but try to find alternative explanations first. In the case of Mills and Halton’s notion of an interconnected elites, I see institutions interlocking, justified by ideologies and a political culture that have to some extent lives of their own. During the cold war, fighting communism justified actions that also protected American corporate interests, and it could even be given a human face with Rockefeller support through art shows abroad featuring abstract expressionists. (How New York Stole the Idea of Modern Art by Serge Guilbaut and Arthur Goldhammer). But that doesn’t mean that Jackson Pollock was part of the Power Elite. It is the intentionality of Mills notion that I question.