FUTURE SHOCK THE THIRD WAVE

Posted by admin_akashic on Aug 7th, 2022 in Space

THE TECHNICIANS OF POWER

As the manager grew in power, the stockholder grew less important. As companies grew bigger, family owners sold out to larger and larger groups of dispersed shareholders, few of whom knew anything about the actual operations of the business. Increasingly, shareholders had to rely on hired managers not merely to run the day-to-day affairs of the company but even to set its long-range goals and strategies.Boards of directors, theoretically representing the owners, were themselves increasingly remote and ill-informed about the operations they were supposed to direct. And as more and more private investment was made not by individuals but indirectly through institutions like pension funds, mutual funds, and the trust departments of banks, the actual “owners” of industry were still further removed from control.

The new power of the integrators was, perhaps, most clearly expressed by W. Michael Blumenthal, former U.S. Secretary of the Treasury. Before entering government Blumenthal headed the Bendix Corporation. Once asked if he would some day like to own Bendix, Blumenthal replied: “It’s not ownership that counts—it’s control. And as Chief Executive that’s what I’ve got! We have a shareholders’ meeting next week, and I’ve got ninety-seven percent of the vote. I only own eight thousand shares. Control is what’s important to me… To have the control over this large animal and to use it in a constructive way, that’s what I want, rather than doing silly things that others want me to do.”

Business policies were thus increasingly fixed by the hired managers of the firm or by money managers placing other people’s money, but in neither case by the actual owners, let alone by the workers. The integrators took charge.

All this had certain parallels in the socialist nations. As early as 1921 Lenin felt called upon to denounce his own Soviet bureaucracy.Trotsky, in exile by 1930, charged that there were already five to six million managers in a class that “does not engage directly in productive labor, but administers, orders, commands, pardons and punishes.” The means of production might belong to the state, he charged, “But the state ‘belongs* to the bureaucracy.” In the 1950’s Mi-lovan Djilas, in The New Class, attacked the growing power of the managerial elites in Yugoslavia. Tito, who imprisoned Djilas, himself complained about “technocracy, bureaucracy, the class enemy.” And fear of managerialism was the central theme in Mao’s China.*