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Step 32: The Culture of the New Capitalism (pt 1)

A walk through how capitalism started: from instability, to state stability for capital investment, and now to corporate instability. Richard Sennett‘s Yale Castle Lectures from 2006, in “The Culture of New Capitalism” walks through the “iron cage” of pyramidal bureaucracy to the “MP3 player” of central power, and how it dismantles time, produces anxiety, and undermines social bonds.

music courtesy of Feslyian Studios [link]

Richard Sennett
The Culture of the New Capitalism

PART 1: militarization of society

Tracing back to Max Weber’s insights, Sennett talks about the “iron cage” of the militarized bureaucracy is mapped onto society by Otto Von Bismarck.

This does 2 things: it gives everyone a place in society, so they won’t rebel, and it creates “rationalized time.” That is regimented time you can plan around, which develops agency for citizens. For the first time, you could plan for what should happen, instead of worrying about what might happen.

Part 2: The Fresh Page

The “fresh page” theory is that as pyramidal, bureaucratic stability crumbles around us, this is not a return to a previous age, but instead a new page in history.

Sennett maps out how in 1962, the Port Huron statement asked for the dissolution of large companies and social frameworks that held people in a rigid, iron grip. Part of that happened: we lost jobs that employ people for life and the ability to plan our life around stability as the corporations dismantled the structures that gave people a place in society and a future they could envision and narrate their lives around. These were not replaced with the communal, sympathetic negotiations and strong social structures, as the authors had envisioned.

Instead, we have a “fresh page” where “relations” have been replaced with “transactions.”

The characteristics of the unique individual who can survive on this fresh page are 1) people who can function in short-term time frames (with no long-term life narrative), 2) a person who can mine their talent for potential rather than becoming a craftsmen at one thing, and 3) they must surrender to their sense of self, over and over.

On the ‘fresh page’ free from rules, many meet failure, and are left drifting alone.

“Alone, they suddenly discovered time- the shapeless time, which before had exhilarated them, the absence of rules for how to proceed… Their fresh page was blank. In this limbo, isolated , without a life narrative, they discover failure.”

Richard Sennett

Part 3: Social Capital

The “iron cage” taught delayed gratification. Where people internalized their desire fulfillment to the extent that they could never arrive at fulfillment, and thus made the cage their home. The psychological trap became very rigid, producing drones and automatons, people who behaved like the machines they worked around.

Sennett wishes that Max Weber had a little more insight into the military to realize this pyramid hierarchy has some built in features of personal autonomy through the negation and translation of messages: each level gets the chance to interpret the order to fit conditions on the ground.

Feeling this sense of agency, to be able to “make a difference,” is an illusion that people need to proceed with an adult life.

Part 4: Capital

With the replacement of the local banker by a global merchant banker and the introduction of leveraged buyouts and hostile takeovers, the corporations themselves became the capital.

This destabilized them as previous associations and processes were broken apart and loyalty (along with employees) was shed. This faster, more ambitious, more cut-throat organization served capital, not people, because investors with “impatient capital” wanted short-term rewards.

institutional solidity became an investment negative… stability was a sign of weakness… the willingness to destabilize one’s own organization sent a positive signal.

Richard Sennett

This stripped down, de-layered version of the company was also changed by technology, such as e-mail communication. Now, instead of passing a command through managers (requiring interpretation and granting agency) a CEO could send an email directly and document their compliance… to the letter. So, email cut that layer out.

As well, automation stripped a layer of the pyramid at the bottom. Now people have to outpace machines to keep their jobs. They no longer have a place in society. Which in Otto Von Bismarck’s bureaucratic pyramid is a failure: the whole reason it existed was to stabilize society by giving everyone a place and role.

Today, the new workers are ashamed of dependency, and “worry about a loss of self-control.” We have reinvigorated and institutionalized the traumas of the unstable past, breaking community and social bonds, a sense of self, and communal history along the way.

Part 5: MP3 Player

Sennett compares the new system to technology: the corporation acts as an MP3 player. The laser shines from the center, playing one track (function) at a time. The workers are hired, perform their function, then are discarded with no loyalty of consideration. Now the workers must self-govern and educate for a changing future, offering no stability. But the companies suffer as well without formal or informal trust: they have lost formerly institutionalized knowledge of what works and the adaptability of people with agency, often making hubristic mistakes.

Leaders today no longer think critically of their employees, choosing instead to outsource anything painful smacking of responsibility of authority. They divorce power from authority, and hand it over to “consultants,” who know little about a company, and whose actual job is often not to be honest, but to shield leadership from the hard or dirty work.

loyalty is dead

90’s leadership guru

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Richard Sennett The Culture of the New Capitalism [link]

Max Weber “The Spirit of the Protestant Work Ethic” [link]



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