Abstract
This is the most recent of several books on modern capitalism by Luis Suarez-Villa, recently retired professor of Social Ecology and of Planning, Policy, and Design at the University of California, Irvine. Suarez-Villa has put forward a bright canvas with innumerable details, but he has painted it with a broad political economy brush. He argues that the pieces of the U.S. political economy fit together but that the assembled puzzle is crumbling under the weight of oligopolies, suppressed especially by recently expanded financial oligopolies. As he writes at the beginning of the concluding chapter, the “state, and the oligopolistic corporate apparatus that supports it, negate fair governance.” The United States is “a society ruled by corporate oligopolies and their privileged elites” and it is “neither just nor democratic” (339).
From cradle to grave, oligopolistic corporations have immense influence not only over our governance, but also over how we live and work, what we eat, how we sustain our health, the way we are educated, how our consciousness is shaped, where we live, how we move around, and how we deal with each other and with nature. (339)
The book is divided into five chapters, plus an introduction and conclusion. The longest two chapters, titled Oligopolies and Financialization, are about 80 and 90 pages in length, with 249 and 278 detailed footnotes, respectively. The bulk of the discussion and the references throughout the book, but especially in these two chapters, are drawn from the Wall Street Journal, next in line the Los Angeles Times, and the Economist. In many senses Suarez-Villa has written a classic work of Marx-like analysis, drawing from government financial reports, the business press, and key texts both historical and current, with arguments and evidence brought up to date but which would be familiar to readers of Paul Baran, Paul Sweezy, and many other old-time contributors to Monthly Review.
The other chapter titles (they are un-numbered) are Fundamental Split (between commodification and reproduction), Stagnation (on the “long-term tendency toward slow or minimal growth,” a result of over-accumulation by the oligopolies), Neo-Oligarchy (on the unjust and undemocratic corporate elites), and the brief conclusion, Governance Derailed.
The first full chapter, Oligopolies, is a powerful listing of sectors with “vast contemporary influence over government and society” (87), from banking, food, hi tec, and on-line education, to medicine, communications, and news media, in which a small number of corporations control a high and recently increased proportion of production and sales.
The arguments in the Financialization chapter are broad, in a Monthly Review sort of way (which I like) but perhaps burdened by repetition and overuse of words like oligopoly (in all its forms). The book asserts repeatedly that this crisis, occurring these days, is unique. Suarez-Villa writes, “[p]olitically, financialism has built deep and widespread webs of influence that have no precedent in American history” (100, emphasis in original).
It is difficult to disagree with Suarez-Villa’s main point, stated frequently, as at the very end of this chapter on financialization, that in good part because of financialism the interests of citizens, residents, “the public,” are of little concern to the government. The state is in crisis: – a state in which the interests of oligopolistic corporate power are served above everything else. A state that is increasingly corporatocratic in deed and spirit, and that crafts its laws to suit the interests of oligopolies. (174)
The chapter on the Fundamental Split between production (“commodification”) and reproduction reminded me at first of those long discussions of the 1960s and 1970s about such things as production and reproduction (when we focused on households), productive and unproductive labor, and of course various sorts of land and housing rent. But then Suarez-Villa takes it in interesting directions, stressing the extraordinary difficulties and lengths to which oligopolistic corporations go to hang on to the less tangible and less easily governed productive capacities, including of course intellectual property.
The chapter on Stagnation, which for Suarez-Villa results mainly from overaccumulation, begins with mention of oligopoly capitalism’s tendency toward stagnation and the problems this poses for the state.
Slow long-term growth in advanced capitalism tends to generate greater economic insecurity, downward mobility, debt, and a redistribution . . . toward the wealthiest segments of society. A dependence on financialism to concoct growth through speculation is also related to this phenomenon. At the same time, greater dependence on intangibles . . . makes it more difficult for the real economy to sustain growth, especially over the long term. (223)
In the final chapter, Governance Derailed, Suarez-Villa sums up by arguing that three “alignments of interest” create the pathologies and dysfunctions reported throughout the book: first, the interests of politicians and government officials align with those of “oligopolistic corporate power”; second, the public imagines its interests to be aligned with oligopolies through financialization and a neoliberal lottery mentality, credit, cuts in services, etc.; and, third, the judicial system aligns with the oligopolies. These alignments are accompanied by three redistributive phenomena: transfer of risk from corporations to the state, of wealth and power from the majority to the oligopolies, and the rise of the neo-oligarchy.
Some readers will hesitate on Suarez-Villa’s arguments. His assertion that this current period of transformation and crisis is unprecedented (100) may seem an overstatement. After all, trusts controlled almost 200 industries at the end of the 19th century (according to linfo.org), John D. Rockefeller’s Standard Oil the giant among them, and of course the Robber Barons ran the railroads. Trust busters did respond with the Interstate Commerce Act in 1887, the Sherman Antitrust Act in 1890, and then reforms under McKinley and Theodore Roosevelt. Still much later, in 1941, Justice Brandeis said, “We can have democracy in this country or we can have great wealth concentrated in the hands of a few, but we cannot have both.” Suarez-Villa is surely correct to say that “[i]nstitutionally, financialism has fundamentally distorted the tax system” (101), but it may be good to remember also that 102 years ago there was no federal income tax. Nevertheless, it is true that economic concentration in the late 19th and early 20th centuries was mainly industrial. Today that concentration is accompanied, superseded, and heavily influenced by highly concentrated financial capital, a central force in our economy.
I find it odd that neither ecology nor environment appears in the (too brief) index. There is no mention of the looming crises of global warming, species destruction, or water shortages, a strange omission given the (properly) sweeping nature of Suarez-Villa’s analysis. I sense the ghost of Barry Commoner frowning, as I think of his forceful melding of Marxian political economy with the essentials of thermodynamics.
One might say the same thing about Suarez-Villa’s failure to mention international crises, about which I know he knows a great deal. Even if we acknowledge the good luck by which we have witnessed neither nuclear destruction nor full-scale “world” war since the bombing of Hiroshima and Nagasaki, it seems to me that a book of this broad scope ought to emphasize the constant warfare, deep poverty, and pervasive pestilence nearly everywhere today, other than in a small number of prosperous and protected islands that rise above a world-wide sea of misery.
I find it wonderful that SUNY Press either allowed or encouraged the use of footnotes, obviating troublesome page flipping back and forth.