���The Vast And Unsolved Enigma Of Power���: Business History And Business Power

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It is traditional to begin this presidential address with some autobiographical background, if only to provide some context for what is to follow. Chris McKenna rightly likes to remind us regularly that few of us self-identify as business historians. In this respect, it is fair to say that I would not be here today if it was not for me getting a position at the University of Glasgow. Until I moved to the university, my research had focused on the making of government economic policy, in particular the Keynesian revolution. At Glasgow, the long tradition of business history research had been formalized in the creation of the Centre for Business History in Scotland a year before I arrived and led then by Tony Slaven. And so, another “business historian” was belatedly born. However, to return to Chris’s anecdote, for me, it is not just an issue of self-identification. About fifteen years ago, an esteemed professor of business history said to me (and with no malice intended or taken): “Neil, you are not really a business historian, are you?” Today, I am happy to swear my oath of allegiance to the field, whether or not this article convinces you of my business history credentials.

I was born in Brighton but then moved frequently around southern England, until at the age of six my family arrived in Croydon, where my parents lived until they retired. We moved frequently as my father’s career progressed. He began as an apprentice in the building trade but worked his way up, so that by the time we moved to Croydon he was a building estimator. I have yet to come across anyone else who has had this job, so I had better explain what it was. He would estimate the costings and then the price of a construction project. This estimate then formed the basis for the company’s tender submitted to the client to try to win the contract. He worked in this role for some of the largest UK construction companies at a time when they were internationalizing. I remember hearing about his trips to various parts of the world, but my sister and I were taken only to Swansea University in Wales and High Wycombe, just outside London.

Why do I tell you this? Looking back on his anecdotes about his job and the industry, it is clear that economic power and political power were strongly evident. Although bids were blind, it was clear that there was sometimes a degree of collusion or at least ballpark knowledge of other companies’ likely bids; and, at times, companies would take turns to try to win contracts. It was also an industry in which incomplete contracts predominated—on a project my father would have ongoing working relations with architects, subcontractors, and the clients, often being involved in follow-up meetings as the building specifications changed or simply to catch up on the developing cost of the project, but always where this was an ongoing negotiation.

All of this is evidence of economic power, but it also merged into political power. The industry famously kept a shared list of ostracized workers linked with trade unions or the left, and it employed the right-wing group the Economic League to spy on suspect workers. When this was closed down, it set up its own organization that operated from the 1990s until 2009, and for which the industry has just paid compensation to some of the workers who were boycotted for over twenty years.Footnote 1 More generally, the industry was known for strongly supporting right-wing or neoliberal think tanks and various other similar activities. Unsurprisingly, it not only had close links with the Conservative Party but was also very active in the Confederation of British Industry (CBI), which was the main representative body of business in the United Kingdom.Footnote 2 The industry often prompted the CBI to push infrastructure projects as an area for further public investment. When threatened with nationalization in the 1970s, my father, like other employees, came home with a sticker for his company car and balloons advertising the merits of the industry.

More seriously, he also mentioned bribery with regard to some of the international projects. The power of these individual companies and the industry as whole resonates with the theme of the address.

After much self-debate I ended up with the title, “‘The Vast and Unsolved Enigma of Power’: Business History and Business Power.” There are many similar such phrases about power, but this one is from Adolf Berle.Footnote 3 I was tempted to use another of his quotes—“Power, next to sex and love, is perhaps the oldest social phenomenon in human history”Footnote 4—but I thought it might give you a misleading impression of what follows. However, this alternative title does link better to the person, other than me, most to blame for this topic: the UK’s Prime Minister Boris Johnson, who certainly loves power, and seems to love sex too.

So, why Boris Johnson? In June 2018, the then foreign secretary responded to concerns raised by business about Brexit with the immortal phrase “F*** business,” prompting headlines like “‘F*** business’: Boris Johnson is accused of dismissing concerns of UK job losses in foul mouthed comment to EU diplomats”; and from the Financial Times’ Facebook page, “‘Fuck business,’ Boris Johnson is reported to have said, putting himself at odds with any normal sense of what the Conservative Party stands for.”Footnote 5 It also resulted in a cartoon that won 2018’s UK Political Cartoon of the Year Award, but the joke, a spoonerism referring to Bucks Fizz, the British winners of the Eurovision song contest in 1981, might be lost on a non-UK audience.Footnote 6

A source close to Johnson subsequently elaborated that he had been misheard; he was actually attacking lobbying groups like the CBI.Footnote 7 Certainly, since becoming prime minister, he has deliberately snubbed the organization on a number of occasions. But the same can be said of his attitude to business more generally. Even the City of London got nothing like the relationship that it wanted with the European Union in the post-Brexit negotiations.Footnote 8

Yet, in the United Kingdom and elsewhere in the world, the common belief is that business is dominant and its power is out of control, particularly in the case of big business and multinationals. Nor is this limited to popular opinion as the titles of these books well illustrate: Gangs of America: The Rise of Corporate Power and the Disabling of Democracy; Unchecked Corporate Power; Monopolized: Life in the Age of Corporate Power; The Political Power of Global Corporations; and The Political Power of the Business Corporation. Footnote 9 Some of these books may be polemical, but others are serious works by respected senior scholars. Stephen Wilks, the author of the last of the list, for example, is not only one of the leading scholars of business regulation in the UK but also served as a member of the UK Competition Commission for eight years. The preface to his book is telling, but typical:

In 1974, when I first became intrigued by the power of business corporations, and particularly by their ability to wrest concessions from national governments, it seemed perfectly possible to bring these concentrations of economic power under democratic control. Now I’m not so sure. It seems to me that many of the democratic gains fought for so heroically over the last 150 years have simultaneously created a set of nominally economic forces which have emptied many of those gains of real meaning. The truly worrying prospect is that those forces, call them corporate capitalism, managerial dominance or simply corporate power, have created new autocrats, immune from effective popular control. Business corporations are often creative and can be brilliant and enriching, but their economic and cultural achievements cloak their ability to dictate political choices. This is far from an original insight.Footnote 10

As business historians, we well know the accuracy of that final sentence, especially for the United States with the cacophony of calls for action against business power during the Gilded Age and subsequently.Footnote 11 The exercise of business power is evident in many areas of business history, from business lobbying and interest groups, to multinational interactions with home and host nation governments, to monopolies and cartels and calls for deregulation, to the study of business networks, interlocking directorates, and business elites.Footnote 12 At the same time, as I will show, most business historians have been reluctant to take on the issue of business power directly and explicitly. Despite working on business-government relations and the collective action of business, I am as guilty of this as anyone else.

In many respects, this reluctance is both understandable and justifiable given that many social scientists are also unwilling to analyze power directly. The subject is too abstract, unfalsifiable, and empirically quite difficult to operationalize. As Culpepper noted in 2011, “The study of business power is currently more neglected than it has been for the last half century.”Footnote 13 Thus, many social scientists have followed the line of the historical institutionalist Kathleen Thelen in shunning “‘the language of power’ in favor of identifying the interests and coalitions on which institutions are founded [because], unlike power, actors and their interests are more tractable empirically.”Footnote 14

Despite this, I would suggest that now might be the time for business historians to visit, or revisit, the study of business power. Why is it timely? For several reasons. First, as Adolf Berle suggested, power is a fundamental issue and should be a fundamental issue for business historians. To ignore it or only to engage with it implicitly relegates what should be a core topic of the field to the periphery. Second, it is clear that there has been a reinvigorated interest in the subject among social scientists since the global financial crisis.Footnote 15 Even Kathleen Thelen is now writing on business power.Footnote 16 Third, and finally, there is evidence that business historians are beginning to talk about power more frequently in their work, but it remains rather unfocussed and often implicit.

This article will begin with a brief discussion of the main core approaches to the theory of business power and explain the problems that have subsequently been highlighted. It will then turn to considering the areas of business history in which business power has been addressed. The third section outlines some of the main recent developments in the social science literature that have emerged with the reinvigoration of interest in the topic of business power. The final section suggests how these new developments offer the potential for new insights for business historians by illustrating how these approaches are informing my own work. It is hoped this will act as a prompt to open a wider conversation about business history and business power.

Source : https://www.cambridge.org/core/journals/enterprise-and-society/article/vast-and-unsolved-enigma-of-power-business-history-and-business-power/41823105B5C71F19E2F18BB0F1DEE709

1903
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