THE BELL TELEPHONE HOUR: Burnham's The Managerial Revolution

Beginning in the early nineteen-seventies I was greatly influenced by the writings of three men: George Orwell, whom as everyone knows was the author of 1984; James Burnham, author of the book which inspired that novel, The Managerial Revolution, and Karl Wittfogel, who wrote Oriental Despotism. These men had three things in common: all were originally Marxists, all ultimately became more conservative (or at least, in Orwell's case, anti-Stalinist), and all taught that the future held not a worker's paradise but a state controlled by governmental bureaucrats and industrial managers, despotic in form. Since Orwell, whose book I have been reading and re-reading since I was in high school, was British and died in 1950, I had long assumed that Burnham (whom I knew only indirectly, from Orwell's commentary upon him) was British and died before I began to think about politics (I knew that Wittfogel was a naturalized American citizen of German descent). So it was with surprise that, when I was recently attempting to re-discover my own intellectual roots, I learned that Burnham, a native-born American, had survived until 1987, and indeed inspired a number of right-wing thinkers (for instance Samuel Francis, whom I find too offensively racist to be worth arguing with). As I am myself of the opposite political persuasion, it seemed worthwhile to read Burnham's book and find out why his theories, as conveyed by Orwell, had so influenced me and why the implications I had drawn from them were so different. To be sure, there were similarities. When I first discovered the "managerial revolution", which might better be called the "bureaucratic revolution", I too was afraid that Communism would triumph and impose a bureaucratic despotism upon us. But perhaps because I have never been a Marxist, and saw no necessary connection between power and the ownership or even control of property, I also glimpsed warning signs within our own society and government, which have become all the more obvious since the collapse of Communism and particularly, after the events of September 11, 2001. Wittfogel, with his emphasis upon the deleterious effects of large-scale irrigation systems upon non-Western societies, had led me to view modern technology as a threat to liberty in every country of the world. What was it about Burnham's theories which ultimately led me to look toward Washington D.C. and not foreign nations as the center of the new bureaucratic despotism? And who exactly are the new managers?

Burnham takes as his starting-point World War II, in the midst of which his book was written (though before the U.S. officially entered it). This is appropriate, as we shall see. He asserts that the war is only the external manifestation of a social revolution. Although that social revolution will replace capitalist society, which is generally characterized by parliamentary democracy and individualism, it will not usher in a socialist utopia. His dismissal of Soviet Russia as a genuine socialist society is all the more persuasive in that the process of movement away from the socialist ideal was later to be repeated in China and other Communist countries. His attempt to prove that socialism is not the only alternative to capitalism and that when capitalism is defeated it will be by another force entirely is persuasive except in one particular, for there is one passage in which, as we now know, he is demonstrably wrong. He says, "Experience has shown that there is not the slightest prospect of ridding capitalism of mass unemployment... Even total war, the most drastic conceivable 'solution', could not end mass unemployment in England and France, nor will it do so in this country." (p. 6). In fact, of course, it did-- and this has vastly more relevance to his theory of the bureaucratic revolution than he himself realizes.

For as he says elsewhere, advances in military technology have rendered obsolete one central tenet of socialist belief-- that the mass citizen armies which characterize capitalist society will ultimately turn their weapons against their oppressors. That is because "victory is today seen to depend upon complicated mechanical [sic--'electronic' would be more accurate] devices-- airplanes, tanks and bombers." (pp. 52-53) Burnham comes so close, yet fails to grasp, that the ultimate vehicle for the furtherance of his new managerial class would be the National Security State, with its continual readiness for and actual participation in unending warfare, which makes it more dangerous than any government which has ever existed. In this he may be excessively constrained by his own Marxist background. For he fails to see that in today's world, power is determined not by ownership or control of the means of production, but by the possession of knowledge, information--especially concerning all advanced technology which has any military application-- and in that fact lies the key to identifying the rulers of the new bureaucratic despotism.

Burnham's prediction that state ownership of all the means of production would replace private ownership (p. 72) has also proven false, but this does not mean that there is no truth in his theories-- actually he himself often confuses corporate ownership with state ownership, as if he did not realize that the former is still, after all, private. The important point is that in Burnham's theory, the managerial revolution is bringing about a situation in which political power is the determinant of economic power-- that is to say, if the advent of capitalism represented what Robert Heilbroner has called "the making of economic society", the advent of the managerial revolution represents its end. This is stated unequivocally by Burnham, who thus unintentionally undercuts the Marxist basis of his analysis: in the new managerial society, "The most powerful will also be the wealthiest." (p.94) Of course private corporations linger on, conveying to leftists the impression that they are fighting capitalism and to rightists the impression that they are defending it. But they have changed significantly in character, because technology has become more complex. As Burnham asserts,

"It is unnecessary to stress that the most important branches of modern industry are highly complex in technical organization. The tools, machines, and procedures involved are the results of highly developed scientific and technical operations. The division of labor is minute and myriad; and the turning out of the final product is possible only through the technical co-ordination of a vast number of separate tasks... A century ago, there were scarcely any trained chemists, physicists, biochemists, or even engineers functioning directly in industry, a fact which is plainly witnessed by the almost complete lack of educational facilities for training such industrial scientists and engineers. The comparatively primitive techniques of those days did not require such persons; today few branches of industry could operate without their services." (pp. 78-9)

These specialists require a new kind of management, which usually cannot be accomplished by the actual owners:

"This task of direction and coordination is itself a highly specialized function. Often it requires acquaintance with the physical sciences (or the psychological and social sciences, since human beings are not the least among the instruments of production) and with engineering." (p. 80)

Thus has the "management-controlled corporation" been born: quoting Berle and Means, The Modern Corporation and Private Property, Burnham says:

"By 'management-controlled', as they explained, they meant that the managments [executives-- we would today call them CEOs] of these companies, though owning only minor percentages of the shares of their corporations, were in actuality self-perpetuating, in control of the policies and the boards of directors of the companies and able to manipulate them at will, through proxies, majority votes of the nominal owners, the shareholders. The American Telephone and Telegraph Corporation is the classic example of 'management-controlled'. (p. 88)

This assertion is bound to raise eyebrows among any aware defender of civil liberties today. It also raises the question, what is the relationship of the managers of these corporations to the managers of the state? And this is where Burnham makes his truly historic contribution, a contribution which Orwell was to illustrate so devastatingly in 1984. Discussing the location of sovereignty in modern society, Burnham says:

"Sovereignty has shifted from parliament to the administrative bureaus... How plainly is reflected in the enormous growth of the 'executive branch' of government... in comparison with the other two branches. Indeed, most of the important laws passed by Congress in recent years have been laws to give up some of its sovereign powers to one or another agency outside its control." (pp. 147-8)

Or, one might better say, to the non-elected part of the executive branch. In this connection, one must not take use of the term "bureaucrat" to imply plodding inefficiency. Bureaucrats in a democracy are plodding and inefficient because they have to follow the law and comply with directives passed down to them from democratically-elected officials. Having written a biography of Albert Speer, I know that bureaucrats in a totalitarian society can be exceptionally dynamic and efficient. So can bureaucrats who belong to what Bill Moyers called "the secret government" in our society-- that portion of the executive branch which refuses to subordinate itself to the rule of law or to democratically-elected leaders.

One such bureaucracy, the Central Intelligence Agency or CIA, was brought into being by the National Security Act of 1947. It was signed into law by President Harry Truman, who later-- as if to confirm Burnham-- lamented that it had grown from a mere intelligence-gathering tool of the president to an "operational and at times policy-making arm of the government." Subordinate to it is the National Security Agency (NSA), which was created in 1952 and operates under the Department of Defense. Both agencies are supposed to deal primarily with foreign threats, but both have come to exercise excessive control over American citizens. Being essentially similar, the corporate managerial elite often cooperates with such government bureaucracies. That this is true can be seen from a case which recently came to public attention and which concerns the "classic example" of a management-controlled corporation, American Telephone and Telegraph (AT&T).

In 2006, a man named Mark Klein, who had worked as a technician for AT&T for some 22 years, made public is discovery of the collusion of that corporation with the NSA. A special room had been installed in the corporation's San Francisco office, which the regular work force were not allowed to enter. Klein's technical specialty enabled him to discover that AT&T was electronically "splitting off" records of the activities conducted by private individuals on the internet-- whether e-mails, websearches or whatever-- and sending them to the NSA. According to Klein, "This potential spying appears to be applied wholesale to all sorts of internet communications of countless citizens." Klein took the information to the Electronic Frontiers Foundation, an organization which aims at the impossible goal of protecting the privacy of internet users, which eagerly took up the cause. EEF filed a class action suit against AT&T , and various branches of the ACLU also did so. When U.S District Court Judge Vaughn Walker ruled that the government could not use the state secrets privilege to block the lawsuit, the government appealed. The Senate passed an act which grants immunity to phone companies which assist in electronic surveillance, while the House passed one denying them such immunity. That such a divided Congress will be able to muster the votes necessary to overrule the inevitable presidential veto is unlikely, and in any case, intelligence agencies pay no attention to any law.

Meanwhile, the man who was in charge of the program, a despotic bureaucrat of Orwellian character, was making progress in his career. General Michael Hayden was director of the NSA from 1999 to 2005. During that time, he developed a strategy to increase the government's use of private industry for domestic surveillance. The first case which came to the public's attention involved warrantless wiretapping of phone calls made to parties outside the United States. The NSA's computer-based system searched for "tagged words" which might reveal the presence of a terrorist plot. Naturally this was bound to affect innocent citizens as well. As one television commentator complained, "Why should I be targeted by the government just because I have told someone overseas that my friend is writing her dissertation on jihad?" But the abuse represented by the warrantless wiretapping of telephone calls is dwarfed by the internet surveillance discovered by Klein. For in the first instance, however unconstitutional the method, there was at least a legitimate concern that someone might be in the process of conspiring to commit a violent act. The internet surveillance, by contrast, seems to aim at discovering the political opinions of people and targeting them on that basis. The mere fact that someone belongs or contributes to an organization which opposes government policy, such as the ACLU, the Center for Constitutional Rights or EFF, can make him or her an object of interest to intelligence agencies. A blog such as this one and the ones which have preceded it on this blogspot undoubtedly make me an object of interest to them. But political opinions, as opposed to illegal actions, are none of the government's business. For his work in compiling lists of dissidents which will undoubtedly be used to nip in the bud any organized movement against future governmental outrages, such as the use of weapons of mass destruction or the declaration of martial law, General Hayden was made Director of the CIA, America's premier intelligence agency and chief promoter of lawlessness and terrorism throughout the world.

All this tends to support the Burnham thesis in its essentials. There is a profound difference between what we used to call capitalism and what the power which a corporation like AT&T represents today. For in contrast to the past, when private enterprise often found itself in opposition to government and in that respect may have exercised a salutary brake upon it (as government in turn exercised a salutary brake upon the rapacious greed of entrepreneurs), now management-run corporations work hand-in-hand with their bureaucratic counterparts. How any leftist today can think that the force he is opposing is capitalism, or any right-winger think that he is defending freedom, is beyond me. For it is clear that an alliance has been forged between the corporate managerial elite and governement bureacracies which is opposed both to traditional capitalism and political liberty. And of all the government agencies which pose a threat to liberty, the most dangerous are the intelligence agencies. We must not forget that the CIA is responsible for overthrowing democratically-elected governments and supporting dictatorships around the world. It is impossible not to think that the repressive methods it has been perfecting-- including torture-- will not be turned upon the Americans whose names have been complied through the NSA-AT&T collusion. When one contemplates this, it seems very appropriate that the CIA-run PHOENIX program in Vietnam called electrical torture "the Bell Telephone Hour".