The First Neo-Liberal Science: Management and Neo-Liberalism

Neo-Liberalism and Management

Neo-liberalism is a political not an economic project because it aims to generate certain forms of subjectivity. It argues positive cooperative bonds are fostered through markets and that these generate new enhanced subjects. It further suggests these bonds must be nurtured through constant vigilance and the maintenance of competition because interest groups seek to avoid markets. Such vigilance is organised through interventions designed to ensure ‘spontaneity’ in the market/society, ever-expanding competition and the presence of elite leadership (Biebricher, 2015; Dardot and Laval, 2014: 101–120; Hayek, 1948: 92–118; Megay, 1970; Müller, 2015). All three help form neo-liberalism’s political rationality. As is well known there is no single neo-liberal project (Brown, 2003, 2006; Gane, 2013) because it mutates across space and time with the (re)structuring of societies (Röepke, 1992: 48–52). However, while proponents often differ, the neo-liberal themes of elite led institutional intervention to ensure competition and the moral rejuvenation of the subject remain. Intervention to reshape subjectivity necessarily gives rise to the importance of authority and leadership because some visions are better – more normal (Brown, 2006: 699) – than others (Hayek, 1948: 108).

These issues are also fundamental to management thought. An examination of two central management figures – Elton Mayo and Max Weber – demonstrates the connections. In different ways both connect to neo-liberalism. While Mayo is directly located in management, Weber’s role is ambiguous because his interest is sociological not managerial. Nevertheless, his influence on management through the sub-fields of leadership, innovation, entrepreneurship and organisation studies has been profound and neo-liberal in direction (Du Gay, 2013 for bureaucracy/post-bureaucracy; Hollander, 1992 for leadership; Hanlon, 2014 for entrepreneurship). Using these origins, the analysis presented demonstrates how neo-liberal and management thought developed remarkably similar solutions to the social crisis of the early 20th century – a time when markets were simultaneously growing and under threat. Since their beginnings management and neo-liberal thought have been kindred responses to the collective challenges confronting organised capitalism.

What follows addresses the core themes of neo-liberalism before examining them in management. In common with neo-liberals, early management theorists stressed active planning, competition, elite leadership and the problematic nature of democracy. For management theorists intervention was necessary if competition, moral rejuvenation and capitalism were to be saved (Bendix, 1956). Thus both projects share fundamental beliefs. Furthermore, their work informs one another; for example, Weber influences neo-liberals (Foucault, 2008: 105; Gamble, 1996; Gane, 2013, 2014; Mommsen, 1974) and management (Hanlon, 2016a, 2016b); Mayo’s (1937) work acknowledges Lippmann’s Method of Freedom (1935); and WB Donham (1922, 1933) – Harvard Business School’s influential Dean – was informed by Lippmann and shared, with President Hoover, a desire to create management as a legitimate authority (Scott, 1992: 58–60). Both programmes addressed similar issues and put forward similar solutions for societies, markets, organisations and individuals. The article draws out these connections and concludes by positing management as a central neo-liberal tool. As such, it builds on Davies’ (2014: 108–147) examination of contemporary management and neo-liberalism.

At this stage two points should be made. First, the article downplays resistance. Although these ideas were fiercely contested (Hanlon, 2016a), in what follows resistance is not central because one reaction of neo-liberal and management theorists to it was to emphasise theory, ideas, think-tanks, writing and the long intellectual war (Dardot and Laval, 2014: 112–114; Mirowski, 2013; Scott, 1992). These theorists also responded to resistance by claiming the ‘mass’ was irrational and/or easily led. Thus resistance intensified their beliefs about the mass. As such, examining these beliefs allows us to unpick the ideological nature of these ‘pure’ projects.

Another downplayed theme concerns the varieties of capitalism debate which stresses governance differences between and within states (Crouch, 2005). Again it could be claimed the article over-extends the reach of ‘neo-liberal management’. Although accepting this, it is apparent that the recent downgrading of the social market within the EU (Biebricher, 2015; Müller, 2015; Offe, 2005a: 154; Streeck, 2014), suggests the emergence of a ‘variegated capitalism’ (Jessop, 2014). While this variegated capitalism houses different governance forms, these are increasingly subordinate to neo-liberal governance thereby making our understanding of neo-liberalism more important. Thus while not denying capitalism’s variety or resistance to these projects, neither is examined.

‘The Social Crisis of Our Time’

In 1938, at the Walter Lippmann Colloquium, neo-liberals gathered to celebrate Lippmann’s The Good Society. The book highlighted neo-liberalism’s dominant themes (Dardot and Laval, 2014). It focused on the social and political crises caused by the maladjustment of many to organised capitalist society; the centrality of competition; the maintenance of private property rights; and the need for new forms of leadership and authority to intervene in the state, institutions and organisations so the masses could be adjusted to the emerging society. Lippmann stressed abandoning liberal laissez-faire for elite intervention if property relations were to be maintained, collectivism defeated, competitive markets expanded and individual subjects transformed – all ongoing neo-liberal priorities (Dardot and Laval, 2014; Foucault, 2008; Gane, 2013, 2014; Hoover, 1922). In light of these different priorities, Biebricher’s (2015) examination provides a useful way to analyse neo-liberalism’s heterogeneity. He suggests a tripartite divide between neo-liberals while stressing the overall aims of the project.

The Mass as Social Crisis

Neo-liberalism’s crisis manifested itself as collectivism – fascism, communism, welfare states and market protection (Hoover, 1922: 1–22). Collectivism was created by those seeking sanctuary from competition (Von Mises, 1944). Such threats were widespread – from farmers, to capitalists, to professions. Indeed, neo-liberals argued interest groups sought to foist markets onto others while pushing them away from themselves. Nevertheless, the biggest collectivist threat was the working class ¹ because it was maladjusted to organised capitalist social relations and capable of using its numerical strength to capture the state thereby protecting itself from markets and threatening freedom (Hayek, 1944: 89–113, 1948: 107–118; Lippmann, 1935: 74–79, 1944[1938]: 45–54; Röepke, 1948: 132–137; Von Mises, 1944: 4–5).

Importantly, this made democracy dangerous because it enabled the majority to separate life and the market (Brown, 2003: 9; Gane, 2013). If capitalism – not democracy – was to be saved, the mass had to be moulded to the market’s form. The economy must be collapsed into a polity where economy and society were one (Mirowski, 2013: 89–157). If unmanaged, the mass pursuit of security and its numerical advantage in a democratic state forced society to ‘its lowest common denominator’ (Hayek, 1948: 109; Lippmann, 1935: 24; Megay, 1970; Röepke, 1948; Von Mises, 1944: 1–19). To stop such descending, both states and private organisations needed to ensure people competed for work (Lippmann, 1944[1938]: 198–199). ² Organisations with their selection and recruitment, structuring of careers, promise of progress, generation of new desires, practices and routines become key mechanisms for securing ‘spontaneous’ labour competition. As such, the managed organisation becomes a core institution for delivering ‘everyday neo-liberalism’ (Mirowski, 2013).

Everyday neo-liberalism operates at two levels – it externally regulates behaviour via rules, rewards and punishments and it internally instils new values and ways of being to engineer a new subject. As such, elite activity, planning and management could never end (Lippmann, 1935: 73). Crucial here is selection which both Mayo (1937) and Weber (1994: 283) understood was reshaping society through new forms of external and internal ‘discipline’. This discipline meant not only would labour heed the call for work but it would adapt to be chosen in the competition to work.

Creating Possessive Individualism and the Entrepreneurial Subject

The desire for security emerged because of liberalism’s failings which themselves were not natural and could be remedied. Indeed, not only is collectivism abnormal within a developed capitalist society but competition becomes the normal, free and spontaneous way of being (Brown, 2006; Foucault, 2008; Gamble, 1996; Hayek, 1948: 1–32). Market competition drives knowledge and allows individuals to learn and behave rationally so that markets are educational (Dardot and Laval, 2014: 101–120; Hayek, 1948: 33–57; Kirzner, 1973; Von Mises, 1996 – as we will see Weber expressed similar views). Because of this, individual competition replaces collective security. The 19th century need to destroy the regulatory system of the earlier order encouraged capitalist collectivism which undermined markets, impoverished labour, generated the inability of many to maintain property rights, and weakened labour’s traditions of socialisation. This forced the mass towards collectivism and created the tendency to concentrate power in distributive states (Lippmann, 1944[1938]: 23–24; Megay, 1970).

Neo-liberals agreed the ‘proletariat’ was created (Lippmann, 1935: 92–95; Megay, 1970; Röepke, 1948: 139) and argued market societies had progressed too quickly for social traditions thereby generating the false urge to collectivise. This drive proletarianised much of the population making them potentially unmanageable by destroying their established routines and practices. These groups needed to be externally regulated by organisations selecting workers, providing incentives and punishments and supporting individual property rights. But they also needed to be internally disciplined through the creation of new desires, ambitions, motivations and ways of being if social order was to be maintained (Lippmann, 1935: 91–97). New governance through new regulations and new routines would form new subjectivities housing new desires – an everyday neo-liberalism. Collectivist threats to knowledge and progress could only be eradicated through widening property rights, markets and competition. To break collectivism the world of possessive individualism must be opened to all – nobody could be protected because everyone was naturally a bourgeois (Mirowski, 2013: 110).

Embracing this project meant labour – indeed all who rejected competition – needed moral reconstructing, re-educating, individualising and creating anew as bourgeois subjects. Such a project reaches far beyond the economic (Megay, 1970: 427) but is difficult because the mass is unthinking, prone to ‘drift’ (Lippmann, 1961[1914]: 101–112), led by ‘dreamers’ (Hoover, 1922: 1–2) and in need of an intellectual elite (Von Mises quoted in Dardot and Laval, 2014: 115, fn. 33). Indeed, mass susceptibility to demagoguery led neo-liberals to question democracy – something Lippmann (1935: 74–79), echoing de Tocqueville, referred to as the tyranny of ‘transient majorities’. The will of the people is problematic because they seek security and the wrong forms of intervention (Hayek, 1944; Röepke, 1948; Von Mises, 1944 – in a contemporary setting see Brown, 2003, 2006; Davies, 2014: 136; Müller, 2015; Streeck, 2014). Collectivism thus creates war economies and undermines freedom (Gane, 2013, 2014; Lippmann, 1935: 54–90; Röepke, 1948: 1–40; Von Mises, 1944). To deliver freedom (Gamble, 1996: 26–49) the spontaneous market must be led by the elite who would carry ‘the Schmittian burden to decide on behalf of others’ (Davies, 2014: 133, emphasis in original). In this world public opinion becomes important because the conditions of mass existence render workers incapable of thought (Lippmann, 1922: 75). It became the elite’s role to shape public opinion and institutions thereby better moulding the mass along neo-liberal lines (Bernays, 1928; Biebricher, 2015: Lippmann, 1992: 107–108; Megay, 1970: Müller, 2015; Röepke, 1992: 176–194). To overcome ‘loose thinking’ (Röepke, 1992: 151–153), neo-liberals must manage opinion and intervene in institutions as a moral endeavour. Institutional restructuring and moral reform merge so the citizen is worked on through rules, desires and ways of being (Röepke, 1948: xxii).

This developing society requires new forms of authority because older forms – craft, age, gender or status – were uncompetitive and being eradicated (Röepke, 1948, 1992). While this was positive, because it unleashed potential and competitive merit, it threatened society. To save society and the individual social restructuring must expose people to the ‘emery wheel of competition’ (Hoover, 1922: 9). Competition trumps democracy because democracy succumbs to interest groups (Biebricher, 2015; Lippmann, 1944[1938]: 263; Müller, 2015; Scheuerman, 1997; Von Mises, 1944: 1–19). Competition in the pursuit of efficiency, the sanctity of private property, and the use of the market as the arbiter of worth, rises above other values. All action becomes economically determined (Gane, 2013, 2014). At neo-liberalism’s core is elite intervention ensuring the institutions of society are subject to competition and the individual is moulded to capitalist social relations and reformulated as an enterprising being (Chiapello and Fairclough, 2002; Dardot and Laval, 2014; Foucault, 2008). Such processes secure private property, liberty and peace.

Trickle down competition structures behaviour and makes managed organisations central alongside the institutions of market and state. Significantly, neo-liberal self-care makes (expert) management pivotal to creating competition as the foundation of society because if organisations must compete then so too does human capital (Chiapello and Fairclough, 2002; Drucker, 1985). Through state regulation and management, subjects are entrepreneurially recreated in markets and competitive work organisations. In light of this, these concerns also emerge in some of the first analyses of management.

Neo-Liberal Themes and Early Management?

If neo-liberalism’s origins emphasise intervention, competition and elite authority aimed at reshaping subjects, then it shares much with management theory. From its inception management thought analysed ways to actively intervene, push competition onto labour and provide leadership to ensure labour was externally regulated, rewarded and punished and internally disciplined so it embraced new behaviours, desires, ambitions and ways of being: that labour both heard the call to work but also needed, or better still desired, the prospect of being chosen.

To do this management had to be (re)invented. One of the features of early management is the transition from management as expense – ‘mere superintendence’ (Pollard, 1965: 250) – to management as the productive organisational activity (Drucker, 2007: 97). Through this transition, management becomes the new form of authority at work. This authority is explicit in FW Taylor – the seminal management theorist. Taylor’s project is structured around the productive gains of ‘good’ management. Management is an intervention into the struggle for knowledge of production on behalf of capitalist accumulation – such knowledge is only good if it is management controlled. Management is not about coordination – although it is that – it is primarily about change through redistributing knowledge from one group to another aimed at developing new routines of working (Taylor, 1903: 1390). This redistribution is important because, as with neo-liberals, Taylor (1903: 1412) felt workers did not know their interests and needed leadership. They could be improved but the necessity of greater effort and the benefits of good management had to be explained to them by objective experts. Without interventionist management organisations failed because workers used their knowledge to collectively control the pace of work thereby lowering competition and damaging themselves and, crucially, citizen-consumers (Taylor, 1947: 18–19). Competitiveness only trickles down from markets to organisations to individuals with management intervention. Unbeknown to workers they need management’s leadership if they are to be individualised, made competitive and hence fulfilled and free. Individuals, organisations and society require management because it delivers a (neo-liberal) world of competition, markets and freedom. As such, management bears the burden of responsibility for competition, authority and leadership (Taylor, 1919: 37).

Management sets worker against worker, breaks collectivity and individualises workplaces. This occurs through constant intervention in organisations via piece rates, internal labour markets, rewards, punishments and career paths. Elite created competition within and beyond the organisation delivers this and hence it is central to Taylor. These ideas structured the organisational form of the 20th century (Stone, 1973). Management becomes a necessary elite activity delivering labour competition. Taylor’s elite intervention is not an aberration or a mere historical artefact. It emerges again and again – albeit in different forms. For example, British Airways’ restructuring before its Thatcherite privatisation reflects these ideas. Restructuring was deemed necessary if investors were to buy shares. It entailed downsizing the workforce, altering work so new forms of stimulation become central (on new forms of stimulation see Chiapello and Fairclough, 2002), hiring personnel consultants to change attitudes, designing appraisal mechanisms focused on new performance behaviours, performance based compensation and profit sharing (these last three sought to encourage individualised employee competition and new forms of legitimacy located in ‘meritocracy’; see Chiapello and Fairclough, 2002). This was pushed through by a new management elite (Goodstein and Burke, 1991). Here, management seeks to create the entrepreneurial subject.

We also see these beliefs in the Thatcher government report on reforming the UK’s National Health Service. The Griffiths Report (1983) was produced under the direction of Roy Griffiths, then head of the supermarket chain Sainsbury’s. It explicitly makes management the central force for creating a more competitive and private sector like organisation. To do so, management must be recruited from outside the public and civil service sectors. Only private sector personnel management provides the leadership to deliver change, cost improvements, secure ‘the proper motivation of staff’, ensure professionals follow management objectives and end democratic consensus management to create clear lines of authority (Griffiths Report, 1983: 11–13). These developments were aimed at changing ‘morale and attitudes’ (Griffiths Report, 1983: 16–17) through new pay structures, conditions, practices, routines and so on. These are inherent themes to management and are central to two of its ‘founding fathers’ – Elton Mayo and Max Weber.

Elton Mayo and Neo-Liberal Thought

Although unknown beyond management, Mayo was perhaps the best funded social scientist of the 20th century. Between 1926 and 1946 the Rockefeller Foundation provided him with $1.5m – a stupendous sum for social science at the time. His work was debated in academic and popular journals by Daniel Bell, Clark Kerr, Robert Merton and Reinhard Bendix, among others. Indeed, Fortune hailed him, alongside Thorstein Veblen and John Dewey, as a modern social thinker (Smith, 1998). He was central to the establishment of Harvard Business School as the pre-eminent institution for business and leadership. When Harvard moved away from the strife associated with Taylor, whom they sporadically employed, it turned to Mayo’s ‘enlightened’ management (Stewart, 2009). He is closely associated with the Hawthorne work experiments which laid the foundation for the human relations school of management – the forerunner to contemporary human resource management. Under the auspices of the Department of Industrial Research, which he headed with Rockefeller money, books such as Street Corner Society (William F Whyte) and Family and Community in Ireland (Conrad Arensberg and Solon Kimball) were published. He closely collaborated with George Homans, T North Whitehead, F Roethlisberger and WJ Dickson and was a member of the elitist Harvard Pareto Circle. This circle reflected Herbert Hoover’s political philosophy (Scott, 1992: 58–60), was hostile to Marxism and socialism and included Homans, Talcott Parsons, Joseph Schumpeter and LJ Henderson. As such, Mayo was involved in important academic projects beyond management and it is unfortunate he is overlooked because ‘his influence upon the academic profession and especially the disciplines of sociology, psychology and their various applied fields has been extensive. It has likewise been extensive with regard to the education of businessmen’ (Bendix, 1956: 308, fn. 126).

In a striking similarity to the role of ‘spontaneity’ in neo-liberalism, Mayo (1919: 48, 1949: 120) argued work is based on ‘spontaneous cooperation’. Like Röpke (1948, 1992) he suggested established society and its socialisation processes of craft, status, gender and age were undermined by capitalism and that an ‘adaptive society’ had emerged which, if left unmanaged, was potentially unfree and un-civilising (Mayo, 1949: 11–30). As such, he believed organisationally dominated market societies needed new spontaneous, unthinking or semi-thinking routines to create new forms of collaboration and cohesion (Mayo, 1937). Thus routines and their cooperative benefits are central to social order. Although Mayo (1939: 335) cites Malinowski, he reflects Hayek (1948: 1–32, 1960: 54–71) because he stresses the importance of ‘custom, tradition, and non-logic’ to routine cooperation. Mayo (1919) argues limited knowledge – a central neo-liberal concept (Hayek, 1945, 1948: 92–106) – necessarily creates a society that should be administered and managed through a small state with a large market if individual freedom is to flourish. The collectivist state is a (im)moral entity that inevitably forces unnatural cooperation. State intervention limiting markets is ‘a subtle form of state control; its decisions are inevitably moral rather than technically skilled, from a strictly industrial point of view’ and as such, it ‘can do nothing to bring about a condition of whole-hearted and spontaneous co-operation’ (Mayo, 1919: 48). For freedom and spontaneous cooperation to flourish, the (democratic) state must be limited by objective (pro-market) technical decision making.

Organised, capitalist, spontaneous cooperation emerges through the creation of new elite led everyday routines:

It must be insisted that the intelligent development of civilisation is impossible except upon the basis of effective social collaboration and that such collaboration will always be dependent upon semiautomatic routines of behaviour made valuable by personal association and high sentiment. The most intelligent adaptation will remain ineffective until transformed from logic and the abstract into the human and actual routine with deep emotional attachment. Here then is the problem for the sociologist and administrator that I propose to illustrate as best I may from personal experience. (Mayo, 1939: 336)

As with Taylor, management’s primary role is creating new routines, new ‘personal associations’ and new ‘emotional attachments’ which reshape social collaboration in particular ways. Ways located in the habits of markets and competitive organisational life; ways which over time form deep meanings and ‘high sentiments’ for people. Mayo wanted to re-engineer the subject by creating new everyday lives located in managed competitive organisations and markets.

Echoing neo-liberals, Mayo (1919: 5) argued liberalism was flawed. His society needed competition, individualism, the rejection of laissez-faire and the limiting of democracy because the mass would use the democratic state to undermine competition and hence civilised society (Mayo, 1919: 5). For Mayo (1919: 10) democracy was potentially as ‘tyrannical as any historic monarchy’. The only way to circumvent the damage of democracy was to reconstruct the subject and this needed an understanding of the subject’s ‘total situation’ which would then collapse life into work. In this vision, ‘spontaneous cooperation’ was no longer possible without management because of the disruptive birth pangs of capitalism. The transition to organised capitalism generated a ‘seamy side’ which eradicated the traditional routines, socialisation and knowledge transfer capacities of labour. This created a ‘rabble’ that threatened society (Mayo, 1923a, 1923b, 1924, 1949: 3–50). As such, labour needed to be moulded by management through new practices and socialisation processes which supported private property, competitiveness and the market (Bendix and Fischer, 1949: 316). While acknowledging the transition to organised capitalism had undermined labour, Mayo (1922: 159) accuses workers of being incapable of developing the learning skills necessary for competitive life without elite leadership. He further argues one of the problems of capitalism is it forces socialisation processes onto the nuclear family which is inadequate to the task. As such, other institutions must take up the moral role of developing everyday individual ‘social discipline’ (Mayo, 1937: 829–830). Neither the family nor the dying traditions of yesteryear could discipline the individual into the new society hence the work organisation becomes the central place for neo-liberal disciplining. Here, work and life collapse so that life becomes the competitive discipline of employment or preparing for employment. Mayo makes management central because the work organisation becomes the site for everyday neo-liberalism’s reconstruction.

Mayo’s neo-liberalism sees the mass as corrupted and easily led so that society and the organisation need elite intervention to morally restructure the worker-subject and secure competition, private property, the market and freedom. Management is the source of this in the same way as today it is the ‘technology’ to ‘make America an entrepreneurial society’ (Drucker, 1985: 15). Mayo’s is a neo-liberal project seeking to externally regulate and internally discipline people through new routines and other forms of spontaneous cooperation to which they would have ‘deep emotional attachment’. As with neo-liberals, external and internal management of subjects is necessary if competition, property rights, markets and freedom are to blossom.

Max Weber: An ‘Elective Affinity’ with Neo-Liberalism

Weber also analyses these issues. In relation to management rather than being discussed as a neo-liberal, Weber is addressed as a bureaucracy theorist or viewed through his iron cage, or for his influence on entrepreneurship, innovation and leadership studies. In contrast, this article stresses his epistemological ‘elective affinity’ with neo-liberalism. The qualified term is used because while Weber influenced neo-liberals (Gane, 2013, 2014; Mommsen, 1974), he also stressed non neo-liberal ideas, for example vocation – the form of conduct wherein different spheres of (competitive) activity produce their own behaviours and ethics (Du Gay, 2013; Gane, 2013, 2014; Hennis, 1983; Merton, 1940; Weber, 1948, 1994: 309–369). Indeed, within management, Du Gay (2013) argues Weber’s work opposes the totalising market project of (neo-liberal) post-bureaucracy. Equally, in contrast with neo-liberalism, Bendix (1960: 469–494) highlights his idealist thinking and his combination of utilitarianism and Hegelian civil society. This leads Weber to suggest self-interest on its own is not enough to understand social relations. Such views potentially conflict with neo-liberalism which prioritises self-interested instrumental rationality at the expense of ideals (Gane, 2013). Thus although here Weber’s work is read to support neo-liberal analyses, whether or not politically he endorses neo-liberalism is an open question – indeed Bendix (1960: 471, fn. 2) cautions us against politically reading him through the logical consequences of his work. Nevertheless, the article’s contention is management scholars use his ideas to give management a neo-liberal inflection which supports active intervention, pursuit of competition and the necessity of elite leadership. These important themes in Weber allow management theorists to take this neo-liberal turn. One can see this in Weber’s views on economic activity, democracy and the relationship between bureaucracy and leadership.

Weber’s concept of economic activity is similar to neo-liberals (Parsons, 2003). Like the Austrians, Weber’s (1975) market is not static, the future is unknown, people make mistakes, behave non-rationally and markets teach us over time. Indeed, in his analysis of utility theory Weber (1975: 33) endorses Menger’s position. Furthermore, rather than allowing static supply and demand determine markets, Weber (1975: 28) stresses the importance of anticipation and social interaction in the formation of price thereby rejecting orthodox economic analysis in favour of uncertainty and risk (Parsons, 2003: 1–19). Finally, the entrepreneur – a key figure in neo-liberalism – is central to the market and production. Through awakening and directing future and uncertain needs entrepreneurs drive production (Weber, 1978, vol. 1: 92; see also Von Mises, 1996: 299). Implicit here are time, dynamism, innovation, entrepreneurship and the fear of stagnation – key concepts in neo-liberal management.

Like pro-plebiscite neo-liberals, Weber also supports universal suffrage because he rejects the idea that the working ‘class’ is a threat to capitalism. Importantly, as a methodological individualist, Weber (1978, vol. 1: 302–305) sees class as a collection of self-interested individuals who were only uniform among the unskilled, property-less and irregularly employed. Indeed, as a (short-term) collection of self-interested individuals shaped by consumer markets, such classes are heterogeneous and open to influence and division. He agrees the working class is powerful but is unconvinced it can, or wants to, abolish capitalism and thus argues for its enfranchisement (Weber, 1994: 102). This defence of universal suffrage is bound up with Weber’s over-riding fear of bureaucracy not democracy (Bendix, 1960: 458–460; Loader and Alexander, 1985: 4). He argues a consumerist working class (citizen-consumers), with heterogeneous desires and interests, ensures markets are competitive. Like some neo-liberals, he believes labour is susceptible to leadership and because of this, it is reformist. Through demagoguery charismatic leaders ‘manage’ democracy and provide bureaucracies and societies with the progressive dynamism they need. The right ‘Caesarist’ leadership (Weber, 1978, vol. 2: 1452) keeps both the bureaucratic form of organised capitalism and the democratic state in check and protects competition, private property and freedom (Mommsen, 1974: 72–94 – Bendix, 1960: 471, fn. 2 challenges Mommsen’s reading).

Weber sees interventionist leadership as central because through (weak) democracy it defends society from an ossified bureaucracy. Again similarly to neo-liberals (Biebricher, 2015: 263), he argues the threat to competitive relations is an alliance between capitalist and state bureaucratic interest groups. This alliance generates a ‘robber capitalism’ (Weber, 1994: 89) allowing capitalists and state bureaucrats avoid competition, thereby undermining freedom. Hence he supports universal suffrage precisely to limit the push towards protection from markets. He argues the two dominant sources of privilege in capitalism – property ownership and education – are in the hands of those groups who benefit from a bureaucracy led economy. For Weber (1994: 105), the enfranchised majority is a bulwark against anti-market segments.

As indicated, bureaucracy is central to Weber’s society. Weber (1978, vol. 2: 956–1005) argues bureaucracy reshapes society by making bureaucratic knowledge and practices central to governance. In so doing, bureaucrats become a powerful group within society and potentially concentrate power. In a manner similar to neo-liberals, bureaucrats use organisational positions to control the populace and the populace is deskilled and confronted by an efficient, objective, rational, secretive, concentrated and powerful force. Furthermore, bureaucrats follow impersonal rules thereby potentially damaging freedom. The bureaucrat is characterised by an obedience located in ‘habitual activity learned in public as well as in private organizations’ (Weber, 1948: 229, emphasis in original). Obedient habits make bureaucrats susceptible to corporatism and the formation of unethical bureaucratic economies because they learn the wrong routines – hence his neo-liberal like stress on the central importance of setting ‘good’ rules by which bureaucrats operate (Bendix, 1960: 465).

Undermining stagnation is achieved by organisational change, dynamism, innovation, entrepreneurship and leadership which are necessary to instilling the right routines (e.g. British Airways or the NHS). Using Weber, management theory embraces such ideas to present charismatic leaders (and entrepreneurs/innovators) as above mundane bureaucratic rules because their genius is the central value creating agency (see Iassacson, 2012). For Weber, charismatic leadership is pivotal to undermining bureaucracy and its un-freedom in democratic states (Burawoy, 2013: 752–753; Mommsen, 1974: 72–94; see also Bendix, 1960: 458 who highlights Weber’s belief that without general cultural decline this undermining was unlikely). This leadership emphasis demonstrates Weber’s (neo-liberal) democratic scepticism. On the issue of democracy and leadership he supposedly expressed the following to General Ludendorff: ‘[i]n a democracy people choose a leader in whom they trust. Then the chosen leader says “Now shut up and obey me”. People and party are now no longer free to interfere in his business’ (Gerth and Mills in Weber, 1948: 42). Thus Weber’s affirmation of charismatic leadership in the face of bureaucratic capitalist societies is used to enable some – in contemporary language leaders, innovators, entrepreneurs – to maintain their freedom and creativity while others inevitably (if unfortunately) are subject to the rules and regulations of the bureaucratic organisation (Du Gay, 2013; Mommsen, 1974: 93–94). In this manner, competitive based leaders set the correct rules for individuals, organisations and societies. In so doing a mass dominated by competitive organisational un-freedom is generated (Goodstein and Burke, 1991; Griffiths Report, 1983; Kantor and Streitfeld, 2015). Graeber (2015: 18) suggests this is the logical end point of neo-liberalism – ‘total bureaucratisation’. Neo-liberals present bureaucracy as the antithesis of competitive freedom (Von Mises, 1944), but in reality neo-liberal management regulates and de-democratises to create increasing un-freedom and rule bound lives for the many and freedom for the elite (Biebricher, 2015; Graeber, 2015: 3–44; Müller, 2015; Streeck, 2014).

Weber argues these twin features of bureaucracy and charismatic leadership – the ‘double nature of what may be called the capitalist spirit’ (Weber, 1978, vol. 2: 1118) – alter people in two neo-liberal ways. Bureaucracy externally regulates subjects through rules, rewards and punishments and charismatic leadership internally alters them by giving people new ambitions, desires and beliefs (Weber, 1978, vol. 2: 1115–1117). Thus if managed by the right elite, bureaucracy and charismatic leadership can shape society, buttress markets, create competitive organisations for labour, mould subjectivity and protect individual freedom. Here Weber’s competitive leadership and bureaucracy dominate individuals, organisations and societies. Some get to manage, intervene and lead and others get to follow, be disciplined and act in prescribed manners. This occurs in market societies overseen by large organisations with competiveness, individualism and private property at their base. Charismatic leaders are the intervening force disrupting bureaucratic rules, altering society, maintaining competition and protecting freedom. They are the seemingly ‘post-bureaucratic’ leaders who sit at the apex of corporate bureaucracies forcing competition onto others (Du Gay, 2013). One sees elements of this toxic combination in Amazon with its merciless bureaucratic use of data to foist competition onto labour and its infatuation with a competitive culture that rewards the successful charismatic leaders and survivors (Kantor and Streitfeld, 2015).

In this reading, Weber favours competition, active intervention and elite leadership. Like neo-liberals, he sees dynamic markets, elite intervention, bureaucracies built on correct rules, and consumer-citizens as part of the solution to the emergence of new (aristocratic) organisations and the undermining of competitiveness. Furthermore, he argued labour was more in favour of freedom than the elite. In particular, he suggested the American worker had resisted bureaucracy, maintained individualism and disapproved of ascribed privilege. However, he suggested this was ending as the USA was ‘Europeanised’ (Offe, 2005b: 50; Weber, 1994: 278–279). Central here was the growing power of bureaucracy within state and private organisations, the role of education, the decline of ‘free land’ and the growth of special interests (see Weber, 1948: 363–385, 1994: 272–303). Reversing this drift necessitated returning to competition in the market, in leadership and in organisations. This reversal is necessarily combined with the limiting of democracy through demagoguery, the need for entrepreneurship and through developing the correct rules to chasten bureaucracy’s potential to subvert the market – all major themes in management and neo-liberal thought today. This ‘elective affinity’ is at the heart of Weber’s ability ‘to influence the neo-Liberalists of the 1950s so greatly’ (Mommsen, 1974: 64) and crucially, management thought ever since.

Conclusion

This article argues neo-liberalism and management are the same programme. Both share responses to the crisis of authority which emerged with the transition to corporate capitalism. Both argue intervention, expanded competition and elite leadership should reshape the subject and social relations through new forms of external regulation and internal discipline. The article suggests management thought and the managed organisational form are central but under-developed themes in studies of neo-liberalism. Management thought aims to restructure social relations and subjects along neo-liberal lines (Davies, 2014: 144–147). Both programmes addressed what they saw (and still see) as the same problem – collectivism and democracy. Thus despite the enabling and inclusive claims of these dominant discourses, both are embedded in elite, anti-democratic thought and practice and should be considered elements of one project. As such, recent intensifications of management forms located in neo-liberal individualisation, competitiveness and leadership through human resource management (Townley, 1993), entrepreneurship (Hanlon, 2014), leadership (Du Gay, 2013), the expansion of management as consumerist practice and pedagogy within universities (Browne Report, 2010) and the explicit demands for more private sector management within the NHS to ensure new subjectivities and less democratic consensus (Griffiths Report, 1983), are part of an extension which is not alien to management as a practical and pedagogic programme. We are witnessing a return to the neo-liberal roots of the subject area rather than a new departure. Indeed it is perhaps the only subject area founded in neo-liberalism. In this sense, management differs to other social sciences in its relationship to neo-liberalism because the relationship is far more organic than the indirect and often confrontational nature of other social sciences to neo-liberalism.