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Response to Review no. 29

I am extremely grateful to Michael Thompson for giving The Third Revolution serious attention in this new series of electronic reviews and responses for the Institute of Historical Research. He presents a generously detailed account of the book’s most significant features: the meaning of the title, the rise of professional elites, notably corporate executives and state bureaucrats, to dominance of post-industrial society, the ten major trends which I discern as common to most advanced societies, even the concept, which he dislikes, of the “great arch” from the extreme free-market to the extreme command economies. And he quite correctly divines that it is work both of serious historical analysis and of contemporary polemic, which I intended, for reasons that will appear.

I am of course flattered and amused by the undeserved comparison with Marx and Lenin – not mine, I hasten to say, but his own and David Marquand’s (meant as a joke, I think), since I have never been a Marxist or an admirer of Lenin, despite valiant efforts by friendly continental immigrants to convert me in my youth. Indeed, I have been hotly criticised by both left and right for being opposed to their positions, including a caning in the TLS by Dorothy Thompson for my first book and a libel suit two decades ago by the Institute of Economic Affairs, which I take to be an accolade if not of objectivity at least of moderation. I do not aspire to the authority or influence, mostly malign, of either guru, and I am relieved that my “guide to political tactics” is “definitely not worthy of a Lenin”. The Second World has suffered and survived a seventy-year experiment with state-centralized communism, and if I have a hubristic ulterior motive it is to warn the First against a similar but opposite and equally reckless experiment with with unregulated free-market ideology which puts theory before human happiness.

My aim in this response is merely to clarify some of the misunderstandings and disagreements which may have arisen between myself and the reviewer. Some will not be resolved and we will have to agree to disagree, but others may be due to my failure to express my ideas clearly enough. Thompson objects, as he has before in reviewing my Rise of Professional Society: England since 1880, to the whole concept of professional society as being too wide and too vague. Yet his own splendid first book was on Landed Society in Nineteenth-Century England – the first volume, I am proud to say, commissioned for my Routledge series, Studies in Social History. No-one objected that landowners, stretching from the Duke of Devonshire with £200,000 a year to squires on £1,000 or less, were too wide an object of study, or that the 1 million owners in the Modern Domesday Book of 1873-76 were not representative of their society. Societies are commonly defined by their dominant elites. From the first, neolithic revolution through the second, industrial one and beyond, society was mostly dominated by those who owned the scarce resource of land (that it lasted 7,000 years is proof of the inefficiency or, some would say, self-restraint of its system of exploitation). Industrial society was dominated by those who owned the scarce resource of material capital, both the landowners and the individual owner-managing capitalists. Post-industrial society is dominated by those who possess the scarce though highly variegated resource of human capital, above all by corporate managers and state bureaucrats. Call them what you will – human capitalists? meritocrats? managerialists? the (rather feebly named) “new class”? No epithet, not even Thompson’s “post-modern”, seems so apt as “professional”, since their power is based on their intelligence, education and experience.

Thompson objects to my concept of “the master conflict” between private and public sector professions since it applies, he infers, only to Britain and the United States but not to France, West Germany and Japan. But circumstances alter cases, and it does apply empirically more to the former than to the latter, while the whole point of comparative history is to show how concepts mutate as they move from one society to another. Indeed, it applies less to Britain as it moves towards a Thatcherite cohesion between business and government, and it applies less to the United States where, despite the opposition to “big government”, the “revolving door” brings corporate business men and other private sector professionals in and out of government with every change of administration. In France and Germany, where government bureaucrats were until recently superior to, and disdainful of, business men, they are now in rapprochement and almost interchangeable. In Japan the bureaucrats, though from the same few exclusive universities as the business men, were always in charge and still “descend from heaven” into top positions in the corporations. In all three “the master conflict” is latent, superseded by the symbiosis which I argue is a more fruitful way of managing a post-industrial society. In the USSR and East Germany the conflict could not arise, since the “nomenklatura” were a unified elite who climbed, by a combination of merit and sycophancy, interchangeably up the political and economic ladder. As Alex Simirenko observed, they dominated an even more nakedly professional society than the West, since they were a sort of theocracy, the confessional profession at the head of all the professionals, and, pace Thompson, were not in some anti-matter ghetto out of the modern world but at the extreme end of the same “great arch”.(1)

Thompson tries to catch me out in the “palpable absurdity” of citing the “hopelessly fudged and massaged statistics” of the USSR and East Germany in a comparative table of real national income per capita (p.9). A glance at the footnote, however, shows that these were “artificial figures, due to inflated official rates of exchange”, a warning as clear as the health panel on a pack of cigarettes. He also quotes, with heavy irony, my belief that the Reagan-Bush and Thatcher-Major regimes did more harm to the British and American economies than the Second or Cold Wars. Yet this can be demonstrated: World War II and its associated rearmament rescued both countries from depression, and the Cold War’s “military Keynesianism” stimulated their economies, while the two latter-day regimes enjoyed slower growth than their predecessors and piled up the largest deficits in history. Again, if my dependence on each country’s existing literature renders controlled comparisons “well nigh impossible”, what else can we rely on? Are we to throw up our hands in despair, ignore the rest of the world, and become “little Englanders” – surely the temptation of too many parochial English scholars? Is this why Thompson, wisely no doubt, has never subjected himself to the trials and tribulations, the risks and the exhilaration, of comparative history?

Yet, paradoxically, he claims to know more about the United States than I, who have been a regular academic visitor here for a quarter of a century and have lived and taught here for the last dozen years. From internal evidence it seems that his knowledge comes mainly from the triumphalist free-market school, who live by persuading themselves that theirs is the best of all possible worlds. If he lived here he would become aware of the strong countercurrent of disillusion and discontent with that complacent theory, a backlash that is supported by genuine statistics of economic growth, real as opposed to official unemployment due to “downsizing” and the export of jobs, maldistribution of income, government and trade deficits, the fear of falling into the underclass, and the massive crime rates and drugs problem, rather than the Candide-like complacency of the right-wing think-tanks. He might become aware of the growing army of skeptics: Arthur Schlesinger, Jr. on “the disuniting of America”; John Kenneth Galbraith on the danger that the free market may lead to equilibrium at a low level of performance, with slow growth and high unemployment; Robert Reich on the fact that the US is losing not only manufacturing but even the high paid professional “symbolic-analytic services” to the Third World; Lester Thurow’s demonstration that the boasted unemployment rate of 5.5 per cent should really be 14 per cent, if everyone out of benefit and in need of a job were counted; Kevin Phillips, the disillusioned Reagan adviser, on the politics of rich and poor, who contrasts the stagnation of average real wages with the take-home pay of CEOs, which rose in the 1980s from 29 to 93 times the average wage, and sees the “middle class” (in American terms the middle 60 per cent) as reaching “boiling point”; or William Julius Wilson on “the truly disinherited” in the inner-city ghettos, abandoned to crime and drugs not only by their “betters” but by their own upwardly mobile fellows. Perhaps the mood is best summarized by the No. 1 bestseller, America: Who Stole the Dream? by Barlett and Steele (published late 1996, after The Third Revolution), which chronicles the adverse impact of globalization on jobs, incomes, women’s interests, and, conversely, corporate profits that fuel the stock market and soak up most of the increase in GNP while maintaining the misleading average per capita.(2)

Thompson concludes vis-a-vis corruption that “there is nothing new under the sun.” I agree, and have said so many times. The elites of post-industrial society are only doing what the landed and industrial elites did before them. Indeed, the moral of my book is that those who control the flow of income are always tempted to steer more and more of it to themselves. The great problem of social organization is to structure the system of rewards so as to lead them out of that temptation, not only for the sake of distributive justice but to save them from themselves. As John Stuart Mill said long ago, while production, the province of supply-side economists, may be limited by nature, distribution “is a matter of human institution solely. The things once there, mankind, individually or collectively, can do with them as they like.” has consequences, not only for present happiness but for (3) How they deal with them has consequences for the future survival of society. I deeply appreciate Michael Thompson’s closing hope that my warning that the greed and corruption of the elites may lead to self-destruction will be generally heeded.

Finally, let me say that there are (at least) two kinds of historian, both equally necessary: those who do the hard work of digging up the facts of local, regional or national history and explaining them, often with great insight and brilliance, and those who (having learned their trade with the first) try to scan, however superficially, a wider horizon. Thompson is one of the most distinguished of the former, who in his monumental editing of The Cambridge Social History of Britain, 1750-1950 deemed it unnecessary to give even a summary national overview of the direction of change. I have become a belated practitioner of the latter, taking a perhaps prematurely stratospheric view of contemporary world developments. For the latter kind of historian, it is not enough to record what they think they see: when they discern “a cloud no bigger than a man’s hand” they feel compelled to warn against it. The warning will hopefully be effective: the storm may be averted, and the success will become a noble, or derisory, failure. If in the process they go beyond the objective role of scholar on penalty of being repudiated by the academic establishment, so be it. At the risk of being accused of an even larger hubris than being (unwillingly) compared to Marx and Lenin, let me quote a greater and more lasting world figure than either: “Here I stand. I can do no other.(4)


(1)Alex Simirenko, Professionalization of Soviet Society (Transaction Books, 1982).

(2)M. Schlesinger, Jr., The Disuniting Of America (Norton, 1992); John Kenneth Galbraith, The World Economy since the Wars (Mandarin, 1995); Robert B. Reich, The Work of Nations (Knopf, 1991); Lester Thurow, “The Crusade that’s Killing Prosperity”, The American Prospect, March-April 1996; Kevin Phillips, The Politics of Rich and Poor (HarperPerennial, 1991) and The Boiling Point: Republicans, Democrats, and the Decline of Middle-Class Prosperity (Random House, 1993); William Julius Wilson, The Truly Disadvantaged: The Inner City, the Underclass, and Public Policy (University of Chicago Press, 1990); Donald L. Barlett and James B. Steele, America: Who Stole the Dream? (Andrews and McMeel, 1996).

(3) John Stuart Mill, Principles of Economics (Longman, 1904 ed.), p.123.

(4)Martin Luther, Speech at the Diet of Worms, 18 April 1521.