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The Power of Business in America: A Re-appraisal

Published online by Cambridge University Press:  27 January 2009

Extract

Over the past fifteen years, there has been a steady stream of books and articles on business-government relations describing the ‘privileged position’ occupied by the business corporation in the American political system. Taking issue with the pluralist paradigm that dominated writing and research on American national politics in the two decades after the Second World War, these writers have argued that business is not simply another interest group. Instead, they have suggested that its role in American society is more akin to that of a dominant class, power elite or private government: it thus possesses a degree of influence that invariably exceeds that of any other class or interest group. This appraisal of the political dominance of business in contemporary American society primarily rests on four sets of interrelated observations. These include the ability of business to define the political agenda; the extent to which business gains disproportionate benefits from the political process; the need for elected officials to maintain a high degree of ‘business confidence’; and the superior capacity of business interests to mobilize political resources, work closely with each other and shape the climate of public and elite opinion.

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Articles
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Copyright © Cambridge University Press 1983

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References

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15 The phrase ‘adversarial culture’ is originally Lionel Trilling's. For a comprehensive description and analysis of its manifestation in American life in the 1960s and early 1970s, see Bell, Daniel, The Cultural Contradictions of Capitalism (New York: Basic Books, 1976)Google Scholar. For particular examples, see the references cited in footnote 1. For an overall analysis of this political phenomenon, which has occurred periodically in American history, see Huntington, Samuel P., American Politics: the Promise of Disharmony (Cambridge, Mass.: The Belknap Press of Harvard University Press, 1981)Google Scholar. Huntington's book represents one of the few scholarly efforts to analyse why the American public became more resentful toward all sources of authority, including the large corporation, during much of the 1960s and 1970s; he argues that since the ‘Great Awakening’, such ‘crucial passion periods’ have occurred in the United States approximately every sixty years. See Chap. VI, pp. 130–66.

16 For various perspectives on the political significance of this ‘new class’, see Bruce-Briggs, B., ed., The New Class? (New Brunswick, N.J.: Transaction Books, 1979).Google Scholar

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18 For statements of this position, see, for example, Bernstein, Marver, Regulating Business by Independent Commission (Princeton, N.J.: Princeton University Press, 1955)CrossRefGoogle Scholar, and Kolko, Gabriel, Railroads and Regulation 1877–1916 (New York: W. W. Norton, 1965).CrossRefGoogle Scholar

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33 For federal budgetary expenditures, see Economic Report of the President, Transmitted to the Congress January 1979 (Washington, D.C.: USGPO, 1979), Table B-70, Federal Budgetary Receipts, Outlays, and Debt, Fiscal Years 1970–80, pp. 264–5.Google Scholar

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35 The auto industry was periodically able to postpone the enforcement of auto-emissions and fuel economy standards. See Lundquist, Lennart, The Hare and the Tortoise (Ann Arbor: University of Michigan Press, 1980), Chap. 7Google Scholar. See below for the second example.

36 Not surprisingly, a concern with the lack of ‘business credibility’ became a major preoccupation of corporate executives. See, for example, Randall, Frederick and Duerr, Michael, Private Enterprise Looking at Its Image (New York: Conference Board, 1970).Google Scholar

37 The 1974–75 recession probably marked the nadir of business's political influence, coming as it did shortly after both the Arab oil embargo and the forced resignation of President Richard Nixon. For business reaction to these developments, see Silk, and Vogel, , Ethics and Profits, especially Chap. 2.Google Scholar

38 See, for example, Aspin, L., ‘Shortage scenario: big oil's latest gimmick’, Nation, 18 06 1973Google Scholar; and Hume, B., ‘The case against big oil’, New York Times Magazine, 9 12 1973, p. 40.Google Scholar

39 Wilson, G. N., The Changing Role of Business in American Politics (Political Studies Association Conference, Exeter, 1980)Google Scholar. The following description and analysis of business's shift in political strategy during the 1970s closely parallels Wilson's argument.

40 According to a Conference Board survey, seventy-one of the government relations practitioners who reported an increase in their companies' political involvement said the strongest factor was the impact of recent government regulations and legislation (McGrath, Phyllis S., Redefining Corporate-Federal Relations (New York: Conference Board, 1979)).Google Scholar

41 McGrath, , Redefining Corporate-Federal Relations, p. 2.Google Scholar

42 McGrath, , Redefining Corporate-Federal Relations, p. 58Google Scholar. For a more detailed description of the role of corporate political affairs offices, see Public Affairs Offices and Their Functions (prepared by the Public Affairs Research Group, School of Management, Boston University, 03 1981).Google Scholar

43 One management consultant estimates that 80 per cent of corporate planning is now concerned with how the world affects the company, and 20 per cent with what management wants; ten years ago these figures were reversed. See Brown, James K., The Business of Issues: Coping with the Company's Environments (Conference Board, 1979)Google Scholar. For more on how corporations attempted to respond to the more hostile political environment of the 1970s, see ‘Business Strategy for the 1980s’, Staff Task Force on Corporate Social Performance, in Business and Society: Strategies for the 1980s (US Department of Commerce, 12 1980), pp. 145.Google Scholar

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46 From a speech by Shapiro, Irving quoted in Drucker, Peter F., ‘Coping with those extra burdens’, Wall Street Journal, 2 05 1979Google Scholar. This development has led some firms to appoint two chief executives – one to deal with the public and the other to manage the business.

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50 See, for example, ‘Preparing for the TV appearance’, Business Week, 14 09 1974, p. 167Google Scholar; and ‘Grooming the executive for the spotlight’, Business Week, 5 10 1974, pp. 57, 61.Google Scholar

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58 Merry, Robert M. and Hunt, Albert R., ‘Business lobby gains more power as it rides anti-Government tide’, Wall Street Journal, 17 05 1978, p. 15Google Scholar. More than a hundred organizations eventually collaborated to defeat this legislation, which was strongly supported by the building trade union. Common-situs picketing refers to the practice of picketing a worksite where employees of more than one employer are engaged in work. While the dispute is with one employer only, the intent and effect of the picketing is to shut down the entire job site, thus affecting employers who were not involved in the original labour dispute.

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61 See Sethi, S. Prakash, Advocacy Advertising and Large Corporations (Lexington, Mass.: Lexington Books, 1977)Google Scholar, for a full-scale study of this phenomenon. Sethi's data are updated in Sethi, S. Prakash, ‘Grass-roots Lobbying and the Corporation’, Business and Society Review (Spring 1979), 814Google Scholar. For a discussion of Mobil's effort, see Poe, Randall, ‘Masters of the Advertorial’, Across the Board (09 1980), 1528Google Scholar. See also Liff, David, O'Conner, Mary and Bruno, Clarke, Corporate Advertising: The Business Response to Changing Public Attitudes (Washington, D.C.: Investor Responsibility Research Center, 10 1980).Google Scholar

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63 Crittendon, Ann, ‘The economic wind's blowing toward the Right – for now’, New York Times, 16 07 1978, pp. 1, 9.Google Scholar

64 See Lott, John R., ‘Economics educator’, Reason (12 1978), p. 52Google Scholar; and Slambrouch, Paul Van, ‘A new kind of think tank’, San Francisco Business (07 1976).Google Scholar

65 For a good summary of the lobbying efforts underlying each of these developments, see Shabecoff, Philip, ‘Big business on the offensive’, New York Times Magazine, 9 12 1979, p. 134.Google Scholar

66 For a discussion of how business succeeded in this conflict, see Walker, Charles E. and Bloomfield, Mark, ‘How the capital gains tax fight was won’, Wharton Magazine (Winter 1979), pp. 3440.Google Scholar

67 See, for example, the Special Issue of Business Week, devoted to ‘The reindustrialization of America’, 30 06 1980.Google Scholar

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69 See, for example, Thurrow, Lester, The Zero-Sum Society (New York: Basic Books, 1980)Google Scholar, and Mueller, Ronald, Revitalizing America: Politics for Prosperity (New York: Simon and Schuster, 1980)Google Scholar. Although their specific policy prescriptions clearly differed from those of business, their analysis of the fundamental problems confronting the American economy was strikingly similar to that of more conservative analysts. For a broader analysis of this shift, see Vogel, David, ‘The Inadequacy of Contemporary Opposition to Business’, Daedalus (Summer 1980), 4758.Google Scholar

70 Baibus, Isaac, ‘The Concept of Interest in Pluralist and Marxist Theory’, Politics and Society, I (19701971), p. 173.Google Scholar