Public and Private Institutions: Bridging the Gap
Robert Heilbroner speaks to the values of capitalism and how it has been viewed and utilized throughout Western history. In short, Heilbroner says that capitalism is a means of placating material wants that are important to human nature, with little regard to aesthetic or moral values that may have been trampled. This also falls in line with his historical analysis of capital development. During the times of Adam Smith and his works, the idea that materialism should be the basis of an economic system flew in the face of religious mores and was intolerable, even to capitalist theorist Adam Smith. This view was rectified eventually by Bentham’s utilitarian philosophy in the late 19th century, which stated that by attaining self-interest in accumulating wealth, the individual is helping their society. This philosophy has since helped form the basics of society and how it is governed. A quote of John Locke states that “…the great and chief end…of men’s uniting into commonwealths and putting themselves under government is the preparation of their property.” This quote aptly describes the way that a society of capitalist gains must be governed. An emphasis is placed on allowing liberties and a limited government in such a society, as can be seen in America today.
Heilbroner’s more applicable comments to a discussion of Warner pertain to his analysis of those forces that control society under the influence of classical liberalism. Heilbroner states that there are four main elite groups that are atop of capitalist society: business executives, politicians, public administrators, and military personnel. Even amongst these groups, there is an even more elite group who governs these classes. Also discussed is the fact that only two times in recorded history has there ever been a lasting revolt against these forces: the Tsarist Revolution during the early 20th century and the bourgeoisie revolt in the West during the 18th and 19th century. The reason why such revolts are few and far between is that societies with capitalist tendencies allow subversive ideas and people into their society. The reason for this is that ideas are treated as commodities, not sacred, and therefore come and go with much fluctuation. Heilbroner, in essence, seems to be saying that there is a primary society of affluence of material but a poverty of morality, which festers underneath the seemingly heartless pursuit of wealth.
Charles Lindblom speaks of the “privileged position of business.” In short, this idea speaks to the trend toward decentralization of government authority in some areas, especially economic, and deference in policy discretion to business elites. Why does government do this? There are several factors in answering this question. First, business needs some sort of incentive and push toward increasing productivity besides intrinsic rewards so government allows a privileged position in policy creation as a reward for economic progress. Another reason is that government has so much on its plate already with other domestic and foreign issues that it cannot possibly be expected to be experts in such a vast and complex field as the business world. We see this in many other policy areas, such as deference to state and local authorities as far as issues in their jurisdiction. This leads to a third reason: Business in particular areas or regions may know what is best for it and having a strict oversight of these businesses would be too heavy handed.
Business is then deemed paramount to a society, dictating income and wealth, prestige, efficacy, and many other material and non-material factors in society. Government does not allow business to run all over their toes and move beyond the bounds of representative democracy; the job of government is to make sure business is doing its job. This has been an issue in the last few decades, worrying many political pundits who feel that business is circumventing electoral politics and hoodwinking the public. I believe the heart of Lindblom’s argument lays in this very worry; his main argument is that this special position of business is a necessary evil, as the economy is the most important of all functions of a society.
Both Heilbroner and Lindblom have compelling arguments in their respective views on society and both of their main ideas are put into action in Warner’s book The Private City. Warner portrays the development of Philadelphia as an example of the development of urban and national political trends. Heilbroner’s idea that capitalism had slowly started to become accepted and exercised as a necessary tool toward acquisition by American society is born out in Warner’s analysis. An example that exemplified this idea is the evolution of municipal structures in Philadelphia.
The first such structure is the establishment of public schooling in Philadelphia starting in the late 19th century. The need for public schooling became apparent when private schools became either unpalatable or beyond the means for many of the general population. A few theories came to the surface about schooling for the city’s children. Joseph Lancaster put one such theory forth in the early 19th century. His idea allowed for poor children to go to school by having their more intelligent and well read peers teach them. This would be an inexpensive way to help teach the poor and ensure a strong educational system. Another idea was raised by Swiss educational reformer Joseph Neef, who proposed a more humanistic and interdisciplinary approach to education, involving more teacher to student contact and an exploration of the self. Both of these ideas would fall short, however, as both public sentiment and private interests were not in sync with these visionary ideas. Instead, the rise of private technical and vocational schools became much popular in the 1840s and became a standard in private education. The affluent and philanthropists would have to bail out these experimental schools and the schism between private and public education would grow farther apart. At its core, this analysis can be seen as a condemnation of the failures of these visionaries to move beyond idealism to a more moderate and attainable middle ground.
The second, and possibly more important, municipal institution that falls under Heilbroner’s statements on capitalism would be the establishment of a water works system in Philadelphia to stem health concerns. Since there was little central planning in Philadelphia until the late 20th century, the needs of Philadelphians in the 1910s fell on a weak committee system consisting of merchants, politicians, and business interests. The concerns over yellow fever at this time were reaching a crisis level and forced a substantial solution. The solution that came about was a mass water filtration and transportation system, much akin to a tributary and canal system that we see today. The creativity born from this crisis had forgone the materialistic wants of these committee members for the inception of this project. Eventually, the tides would change as the project worked toward defeating an immediate crisis. As the occurrences of yellow fever and other water born diseases started to decrease, apathy and lethargy overcame the committee system. The water works project would only last in that form until the middle 19th century and would again rise as innovations in sanitation took form in the early 20th century.
What can be observed from this example is the need for some crisis or sense of fear to instill the need for mass democratic behaviors in the public. The committees only formed in the midst of emergency and would only last effectively until this crisis was eliminated. Capitalism’s ethos of abandoning moral and aesthetic values for profit can be seen as well in these two examples of municipal institutions. An ideal form of education fell by the wayside because of a lack of funding and support from the public sector. A system of sanitation that would have benefitted all and would have kept public health at a premium was destroyed because there was no pressing issue that would make a water works necessary.
Lindblom’s analysis of the privileged position of business as a necessary evil of the modern capitalist ethos can be seen in the expansion of the Philadelphia city limits outwards and the resulting effects on community politics. When developments led to the affluence of a larger number of the middle and upper classes, they fled the darkness and poverty that surrounded them and headed outward to what is now referred to as the suburbs. Leaving the suburbs were a class that had previously participated, until recently, in more participatory politics and had acted in committees and on the behalf of their peers. Thus, when these people left the city, they also left a power void in the already weak system of community government that existed in Philadelphia.. Who swept in to take control over the city limits of Philadelphia? Business interests, professional politicians, and administrators (much akin to Heilbroner’s argument) were the lone descendants of the migration to the suburbs and thus became the central power in politics in the early 20th century in Philadelphia, as it would in many other cities in the United States. Economic progress would not be stopped by any sense of community cooperation or need for a cohesive political agenda for a greater good.
Do these ideas on capitalism still hold true today? I tend to believe so, and I would say that Lindblom’s arguments are much more compelling then the arguments presented by Heilbroner. The idea that there is a privileged position for business is very much a fact today in American society, what with commercial domination of our everyday lives and the ownership of major media outlets by business interests at every turn. I also feel that his argument about the necessary evils of such a system is very accurate. Without business interests and without the strength of our economy, we would not be what we are today, a world power with influence transnationally. This is all testament to a much more loosely held regulatory policy on business and an interesting dichotomy of business and government: while both are necessarily in cooperation with each other, both are also vying for competing amounts of support from the public and power to do their bidding.
Of course, this dialectic, as most are, is an ever evolving and complex process. My feeling is that in the end, business will always win out but will always be assailed by some sort of democratically minded subversion. Business is much more important to the everyday lives of the American public than democratic equality, no matter how unfair it may seem ideologically. We live under the guise of a representative democracy, and if someone believe that they are living in a fantasy world. Business gets many of the deferred benefits of policy making with the government checking it periodically. Politicians are basically hand puppets for a greater hierarchy of business and government that becomes amalgamated into one gigantic and complex social system. In short, Lindblom’s argument are stark yet compelling and are very much accurate as to the current situation.
In the end, we can see a bit of all of these ideas in modern society. All three writers have captured the essence of the argument, conceding the fact that capitalism and business interests have gained the upper hand on the democratic ideology. All three also present a slightly different angle on this very same argument: Heilbroner with a broad Western perspective, Lindblom with observations pertaining very much to the present situation, and Warner with a case study for the development of public and private interests in Everytown, USA. I would have to say that I comply most with Lindblom, as I have mentioned before, but I cannot disagree with any of the three in their basic arguments. Capitalism has become, and will always be, the driving force behind Western thought because of the nature of human thought. The battlefield has become strewn with the remains of egalitarian and social democratic thought, with ideas such as individualism and private property standing tall in victory.
