Manufacturing Discontent: The Trap of Individualism in Corporate Society

Michael Perelman, Manufacturing Discontent: The Trap of Individualism in Corporate Society (London: Pluto, 2005).

Capitalism loves those who love it. Thus Michael Perelman, a radical economist at California State University-Chico, labors in relative obscurity. In Manufacturing Discontent, he writes for the layperson. To this end, he offers analysis and information on the social causes and effects of modern capitalism. Academic and media praise about the pristine perfection of market competition has made this kind of study hard to see, and in this sense Perelman’s book is a strong corrective.

Case in point is the corporate production of autos by unionized workers after WWII in the US. Then, unlike now, business was good for General Motors. The beneficial effects were heralded to be likewise for the nation. Perelman delves into the underlying reality during this golden age of US capitalism. A central feature of this time was the deliberate design of poor quality cars built not to last but to boost shareholder value via “planned obsolescence.” Greater quantity did not equate to better quality. For Perelman, such waste defines corporate production and distribution under the capitalist economy.

With respect to the individualizing effects of capitalist auto production, GM elites, with a cold calculus, planned to weaken labor union solidarity by offering autoworkers a defined-benefit corporate pension program. They ultimately succeeded. Crucially, the corporation’s plum deal for this small fraction of US workers was unavailable to the rest of the nation’s populace. Here we see the impact of past policies and practices of the US labor movement that chose to exclude rather than include all workers into the “one big union” favored by the radical Industrial Workers of the World. Perelman explains clearly how the United Auto Workers’ involvement with the GM pension fund was limited to their identifying, as individuals drawing retirement benefits, with the carmaker’s future profitability.

Administration of the pension program remained with GM. The devil was in these details. The current relevance of this flawed approach could hardly be greater. GM shareholders are responding to market competition from foreign carmakers by attacking UAW pensions. As corporations use federal bankruptcy courts to liquidate employee pensions, the UAW’s decision to cede control over their pensions to GM looms large indeed.

Perelman aptly cites Adam Smith on the deception of people who seek pleasure via consumer purchases.1 Smith’s critique of industrial capitalism was deepened by Thorstein Veblen, a Marxist scholar and iconoclastic thinker. Veblen’s focus was on the dehumanization of the working class via its aping the competitive consumption of the upper class. Cogently, Perelman mines the writings of Marx, Smith and Veblen concerning money. The artificially created store of value that we call currency affects the development of real and imagined happiness for humans. For Perelman, human alienation in a market economy cannot be understood so long as its corporate origin is obscured.

In the mainstream pro-corporate rhetoric of the past twenty-five years, government regulation harms businesses and, by extension, the consumers they serve. The myth centers on an imaginary community in which consumer and producer thrive whenever government steps aside for the market to work its magic. Perelman refutes this view by focusing on the class-structured conflict formed by the inequality of social relations. “[T]he government sees fit to put strict limits on consumer sovereignty,” he writes, “especially when any substantive consumer sovereignty might collide with corporate interests.”

Take food. The federal government’s complicity with the Monsanto Corp. enabled it to poorly inform consumers via deficient food labeling of dairy products containing recombinant bovine growth hormone, given to cows for them to produce more milk. Corporate accountability for such criminal wrongdoing is shockingly absent. “The government takes corporate crimes so lightly that it does not even bother to publish statistics on this subject,” Perelman says. He makes clear that class control of the state — the “executive committee for handling the common affairs of the bourgeoisie” in Marx’s famous phrase — is, for corporate America today, alive and well.

The purpose of such control is the corporate business model that generates profits for shareholders — rightly so, according to leading mainstream economist Milton Friedman. For him, the ideal politics stands apart from economics, i.e. the so-called “free-market” view of human society. With reference to the case of Monsanto and the government as well as various other corporations, Perelman demolishes Friedman’s theory of the market that has shaped the past quarter-century of public policy in the US.

Besides being kept in the dark about the food they buy, people are subjected to constant corporate advertising that appeals to their individualizing preferences for this or that commodity. The commodity form, of course, was a key concept for Marx in his seminal work on capitalist production. As this dynamic and revolutionary system has spread, the production and distribution of commodities has invaded new spheres of life. One is gender. The beverage industry, for example, targets teen girls with new products that pander to issues of body appearance and self-esteem. Firms such as Abercrombie & Fitch hire young women to make thong underwear, which is then marketed to pre-teen girls.

This corporate push for individuals to pursue competitive and destructive consumption, to “keep up with the Joneses,” supposedly equals consumer power, according to the conventional wisdom. In Naming the System: Work and Inequality in the Global Economy,2 economist Michael D. Yates analyzes such thinking and finds its assumptions and conclusions faulty. The owner/producer, and not the consumer, is king/queen of the market. In Manufacturing Discontent, Perelman complements Yates’s critique. Workplace relations in corporate society “may be the possible strongest example of consumer sovereignty — that of the employers who purchase the services of their workers,” Perelman writes. Such wry humor is sprinkled throughout his book. Daily, working people come to understand that the boss need not be right; s/he need only be the boss, a proxy for the employing class extending and intensifying the working day. This workplace process, in both material and psychological terms, cramps the lives of people by squeezing leisure time from them with grim precision, of which Perelman says: “Such is the reality of our modern version of individualism in which commerce triumphs over all else!”

In terms of political triumphs, the neo-conservatives on 1600 Pennsylvania Ave. in 2006 favor the rhetoric of persons being accountable and responsible. This language is highly selective, however. Perelman hammers the point home with reference to the utter lack of accountability in the taxpayer-funded fiasco of the scientifically untenable missile-shield defense technology, backed by weapons makers and the members of Congress who represent them. This is one example of many that Perelman cites to illustrate how corporate-government collaboration harms individuals and society generally.

For many people most of the time, the experience of class power comes on an individual basis. Alone they lack power, exactly where corporations want to keep them for reasons of power and wealth. “Although individualism might seem to be antagonistic to corporate power,” Perelman argues, “it reinforces corporate power.” Crucially, this contradiction flows from patterns in US history established under racial slavery in the 18th and 19th centuries. The long history of racialized colonialism and racial slavery defined in no small way who is a citizen and who is not. Considering this factor in the US national identity can, I think, enhance the grassroots coalition-building and learning required to reverse the rise of corporate capitalism and the decline of labor unionism that have helped to atomize the US populace since the end of the Vietnam War. Perelman’s thesis in Manufacturing Discontent is essential to the popular understanding of political democracy, in militant opposition to corporate rule.

Perelman writes in an era of unprecedented power for US corporations. One result of this social triumph is that the left is mired in organizational disarray. Progressive actions to reverse this corporate trajectory require laboring and oppressed peoples to join forces around improvements to the common good. To realize such a goal will require ordinary people to have accurate facts and information about ruling circles of wealth and power. Reading Perelman’s book is a useful step in this direction.

Reviewed by Seth Sandronsky, Co-editor
Because People Matter, Sacramento


1. See Perelman’s earlier work, The Invention of Capitalism: Classical Political Economy and the Secret History of Primitive Accumulation (Durham, NC: Duke University Press, 2000).

2. (New York: Monthly Review Press, 2003).

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