Chapter Content
Okay, so, you know, let's talk about what was going on in the sort of, mid to late twentieth century. It's, like, a really interesting time when you think about business and society. So, the sixties, right? Total upheaval. You had the Beatles, mini skirts, the Pill… and you know, Kennedy. And then the tragedy of his assassination, and Johnson pushing through civil rights and the Great Society.
But, the thing is, corporations were becoming, like, a big deal. I mean, they were so entrenched that, they became fodder for satire, you know? But there were also people raising real concerns. Eisenhower, for example, he warned about the “military-industrial complex,” which is a really important concept. And Galbraith was arguing that corporations were, basically, controlling everything.
Basically, all the foundational stuff, you know, about corporate governance, the theory of the firm, all that, organizational theory, it was all written in this context of, like, huge manufacturing corporations, like General Motors. GM was, like, the poster child for the “technostructure” and, it was the target of people like Ralph Nader who was really critical of corporate irresponsibility. You could spend days, seriously, in a library and not realize that American business went beyond this one company in Detroit, can you imagine?
But, of course, there were other things happening, too. The Vietnam War was really dividing the country, sparking all these protests and the anti-war movement. And then '68, student protests all over the world, actually unseated the leaders of the US and France.
And the critique of business was getting a lot more, well, let's say, forceful, right? People weren't just talking about the nuances anymore, they were calling for the overthrow of capitalism! They were inspired by thinkers like Gramsci, Marcuse, and Chomsky.
And the whole thing had, like, these ripple effects. This guy Dutschke, he came up with “the long march through the institutions," you know? The idea was to kind of, infiltrate professions with left-leaning grads. Some people later said it was pretty successful.
Of course, it wasn't just protests. People started talking more about the environment, you know, Rachel Carson's "Silent Spring" really kicked off the modern environmental movement. And Paul Ehrlich was predicting, um, apocalyptic stuff that didn't pan out, you know? Plus, you have Nader getting harassed by GM trying to discredit him, and, yeah, it's not a good look for them.
So, you've got all this hostility towards business from intellectual circles, right? And that sparked a reaction. Milton Friedman wrote this famous article, "The Social Responsibility of Business Is to Increase Its Profits." I mean, it was a pretty strong statement, you know? He thought that businesses talking about social responsibility were basically preaching socialism, which sounds pretty intense, honestly.
Then, you have Lewis Powell, a corporate lawyer, writing a memo for the US Chamber of Commerce. He emphasized education and getting business issues addressed sympathetically in universities. And then he gets nominated to the Supreme Court. And, uh, people like Fred Borch and John Harper started the Business Roundtable, which is now a big lobbying group in Washington.
So, Powell's approach was actually pretty effective. The idea of “the long march through the institutions” worked for both sides, the right and the left. And business-friendly scholarship was being funded. Think tanks like the Heritage Foundation and Cato Institute became really influential.
Dutschke wanted students to take their ideas into the workplace. Powell wanted business to, you know, engage with the world of ideas. And it's not a stretch to say that, that, this period really laid the groundwork for the whole culture wars we're seeing today.
And, you know, while all this was going on with protests and stuff, things were also changing in the financial world, too. The Bank of England was encouraging the Eurodollar market, and that was the beginning of this huge expansion and deregulation of financial markets.
The Bretton Woods system, the one that set up the IMF and World Bank, that started to crumble. The Vietnam War had economic consequences, inflation started rising, and then Nixon abandoned the gold standard. And the Yom Kippur War led to an oil crisis that fueled inflation even more.
Then you have, the Mont Pelerin Society, which, I guess was sort of a dining and debating club for right-wing intellectuals. It's impact may not have been as direct as the changes in the political and business climate that were happening. I actually went to one of their meetings once, it was about the role of evolution in business and economics, weirdly enough. It was in the Galapagos Islands. Very impractical, but, you know, it had, like, a tragic end, if I remember correctly.
The political fallout from all this was huge. In Britain, you had the Labour government in the '70s, then Thatcher coming in at the end of the decade. In the US, Reagan beat Carter. And suddenly, the leaders of Britain and the US were all about market-oriented policies, what they called neo-liberalism.
France went the other way for a bit. Mitterand got elected and started nationalizing stuff and expanding welfare. But that didn't last long, he ended up having to backtrack.
And Mitterrand's U-turn was, like, the last gasp of socialism in the Global North. The Soviet Union collapsed between '89 and '91. The world had changed, a lot since the sixties, when General Motors was king and everyone was worried about the "missile gap". So, what was to come next? And what were the new ideas coming from the neo-liberal turn?