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State and Ruling Class in Corporate America

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State and Ruling Class in Corporate America STATE AND RULING CLASS IN CORPORATE AMERICA G. William Domhoff On top of the gradually-merging social layers of blue and white col- lar workers in the United States, there is, a very small social upper class which comprises at most 1% of the population and has a very diVerent life style from the rest of us. Members of this privileged class, accord- ing to sociological studies, live in secluded neighborhoods and well- guarded apartment complexes, send their children to private schools, announce their teenage daughters to the world by means of debutante teas and debutante balls, collect expensive art and antiques, play backgam- mon and dominoes at their exclusive clubs, and travel all around the world on their numerous vacations and junkets. There is also in America, an extremely distorted distribution of wealth and income. Throughout the twentieth century, the top 1% or so of wealth-holders have owned 25–30% of all wealth and 55–65% of the wealth that really counts, corporate stock in major businesses and banks. But even that is not the whole story, for a mere .1% have at least 19% of all the wealth in the country—190 times as much as they would have if everyone had an equal share. As for income, well, the maldis- tribution is not quite as bad. But one recent study argues that if income from capital gains is included, the top 1.5% of wealthholders receive 24% of yearly national income. And, as all studies on matters of wealth and income are quick to point out, these estimates are conservative. It is not hard for most of us to imagine that the social upper class uncovered in sociological research is made up of the top wealthholders revealed in wealth and income studies. However, it is not necessary to rely on our imaginations, for it is possible to do empirical studies link- ing the one group to the other. The rst systematic studies along this line were reported by sociologist E. Digby Baltzell, but there have been others since. In most countries, and in most times past in our own country, it would be taken for granted that an upper class with a highly dispropor- tionate amount of wealth and income is a ruling class with domination over the government. How else, it would have been argued, could a tiny group possess so much if it didn’t have its hooks into government? But not so in the United States of today. This nation is diVerent, we Critical Sociology 25,2/3 state and ruling class in corporate america 267 are assured. It has no social classes, at least not in the traditional European sense, and anyhow there is social mobility—new millionaires are created daily. Besides, many diVerent groups, including organized labor, organized farmers, consumers, and experts, have a hand in polit- ical decisions—at least since the New Deal. There is no such thing as a ruling class in America.1 In this paper I am going to suggest that in fact a ruling class does dominate this country, a suggestion which not only ies in the face of prevailing academic wisdom, but raises problems for political activists as well. To support this suggestion, I will describe four processes through which the wealthy few who are the ruling class dominate government. Let me begin by de ning two terms, “ruling class” and “power elite.” By a ruling class, I mean a clearly demarcated social upper class which a. has a disproportionate amount of wealth and income: b. generally fares better than other social groups on a variety of well- being statistics ranging from infant mortality rates to educational attain- ments to feelings of happiness to health and longevity; c. controls the major economic institutions of the country; and d. dominates the governmental processes of the country. By a power elite I mean the “operating arm” or “leadership group” or “establishment” of the ruling class. This power elite is made up of active, working members of the upper class and high-level employees in institutions controlled by members of the upper class. Both of these concepts, I contend, are important in a careful con- ceptualization of how America is ruled. The distinction between ruling class and power elite allows us to deal with the everyday observation, which is also the rst objection raised by critics of ruling-class theory, that some members of the ruling class are not involved in ruling, and that some rulers are not members of upper class. Which is no problem at all, in reality. There always have been many members of ruling classes who spent most of their time playing polo, riding hounds, or leading a world-wide social life. And there always have been carefully- groomed and carefully-selected employees who have been placed in posi- tions of importance in government. The most important criticism of class-dominance theory is cham- pioned by political scientists, who say proponents of ruling class theory do not spell out the mechanisms by which the ruling class supposedly dominates government. Not content to infer power from such indica- tors as wealth and well-being statistics, they want the case for govern- mental domination by a ruling class demonstrated in its own right, without appeal to statistics on wealth, income, health, and happiness. 268 william domhoff Despite the generally negative response I have received from politi- cal scientists, I would like to take another stab at satisfying their major criticism of ruling-class theory. Perhaps it is masochism that motivates this near-hopeless task, but I have a new way of thinking about the problem of ruling class and government that may put things in a new light. Simply put, I think there are four general processes through which economically and politically active members of the ruling class, operat- ing as the leaders of the power elite, involve themselves in government at all levels. I call these four processes: 1. the special-interest process, which has to do with the various means utilized by wealthy individuals, speci c corporations, and speci c sec- tors of the economy to satisfy their narrow, short-run needs; 2. the policy-planning process, which has to do with the develop- ment and implementation of general policies that are important to the interests of the ruling class as a whole; 3. the candidate-selection process, which has to do with the ways in which members of the ruling class insure that they have “access” to the politicians who are elected to oYce; and 4. the ideology-process, which has to do with the formation, dis- semination, and enforcement of attitudes and assumptions which per- mit the continued existence of policies and politicians favorable to the wealth, income, status, and privileges of members of the ruling class. Let me now turn to each of these processes to show their role in ruling class domination of the government. Although my focus will be on the federal government in Washington, I believe the general schema can be applied, with slight modi cations, to state and local governments. The special-interest process, as noted, comprises the several means by which speci c individuals, corporations, or business sectors get the tax breaks, favors, subsidies, and procedural rulings which are bene cial to their short-run interests. This is the world of lobbyists, Washington super-lawyers, trade associations, and advisory committees to govern- mental departments and agencies. This is the process most often described by journalists and social scientists in their exposés and case studies con- cerning Congressional committees, regulatory agencies, and governmental departments. I do not think I need spend any time giving examples of how this process works. Indeed, each reader will have his or her favorite studies for demonstration purposes. There are many ne studies of this process, and more are appearing all the time. The information in these studies might seem on its face to be impres- sive evidence for ruling-class theory. After all, it shows that members state and ruling class in corporate america 269 of the ruling class are able to realize their will on innumerable issues of concern to them. They can gain tax breaks, receive subsidies, sub- vert safety laws, and dominate regulatory agencies, among other things. However, in the eyes of most political scientists this is not adequate evi- dence, for it does not show that the various “interests” are “coordi- nated” in their eVorts. Moreover, it does not show directly that they dominate policy on “big issues,” or that they control either of the polit- ical parties. This typical view is even expressed by Grand McConnell, the political scientist most sensitive to the many ways in which various private interests have taken over the piece of government of greatest concern to them. After concluding that “a substantial part of govern- ment in the United States has come under the in uence or control of narrowly based and largely autonomous elites,” he then asserts there is no need to talk of a power elite because These elites do not act cohesively with each other on many issues. They do not rule in the sense of commanding the entire nation. Quite the contrary, they tend to pursue a policy of noninvolvement in the large issues of statemanship, save where such issues touch their own particular concerns.2 Moreover, the big interests do not dominate the government as a whole. The political parties and the Presidency seem to be beyond their reach: Fortunately, not all of American politics is based upon this array of small constituencies. The party system, the Presidency and the national govern- ment as a whole represent opposing tendencies.
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