The Corporate Reconstruction of AmericanCapitalism, 1890,1916:The Market, The Law and Politics, By Martin J. Sklar (New York;Cambridge University Press, 1988. 484 pp.)

Since the late 1950s, Martin J. Sklar has developed an original and influentialapproach to recent American history while remaining largely uninfluenced bycontemporary academic currents such as social history. In particular, Sklarespoused the relevance of a certain kind of Marxism to American history beforeMarxism became fashionable, and he maintains it now that Marxism isonce againout of fashion. Before the publication of this book he produced, in articles, twoconcepts of great significance - corporate liberalism and disaccumulation.

"Corporate liberalism" is an attempt to capture twentieth century liberalideology. Since the progressive era, liberalism has presented itself as the use ofgovernment to regulate business in the popular interest. The concept of "corpo­rate liberalism" points to the role of large-scale corporate interests and theiradvocates in formulating this ideology - not as a "conspiracy," nor so much to gainimmediate advantages, but out of a self,conscious - class-conscious - sense of theneed for order and legitimation.

"Disaccumulation" is Sklar's attempt to frame a "law" for corporate capitalismanalogous to the law ofaccumulation Marx developed for market or competitivecapitalism. Under the terms of the nineteenth century market, increases inproduction required increases in labor time, thereby provoking, for example, thegreat struggles over the work day. "Disaccumulation" is the idea that in acorporate-dominated economy, where information and technology are central,increases in production proceed as a function of the decrease in labor time.

The Corporate Reconstruction of AmericanCapitalism, 1890,1916 builds on theconcept of corporate liberalism to show how the shift from the market to acorporate dominated economy was accompanied by a transformation in Ameri­can law and government. Recent historians of nineteenth century America suchas Eric Foner and Eugene Genovese, because they understand capitalism toinvolve a politics and culture ("free labor"), as well as a system of economicrelations, have been able to argue, without reductionism, that the developmentof capitalism was central to nineteenth century history (e.g. to the Civil War).Sklar is attempting to show that capitalist development is no less central totwentieth century politics and culture.

Most nineteenth century Americans believed that the free market was the basisnot only of liberty but ofcommunity and individual discipline; hence they viewedthe state as distinctly subordinate to "society," i.e. The play of private economicforces. The challenge to the market came at the end of the century with the riseof the large corporations ("trusts") and the dislocation that at first accompaniedthem. Many Americans, such as the Populists in Sklar's interpretation, sought topreserve or restore the market. Others however saw a value in the new corporateforms and broke with the earlier ideal of market individualism.

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Just as the earliest capitalism required advocates, ideology, and politicalstruggle, so did this new stage of capitalism, and Sklar speaks of a "movement" forcorporate capitalism. The movement had its external opponents - supporters ofthe older marketplace concept, small businessmen - and was internally divided,especially around the issue of how much power should be vested in the state."Corporate liberalism," essentially achieved during the early Wilson presidency(1913,1916), represented a resolution of these conflicts. Its fundamental charac­ter - its "liberalism" -lies in the fact that the state remained largely subordinateto private economic forces ("society"); thus "corporate liberal" ideas were able towin over many of those committed to market individualism and become he,gemonic. This, in essence, is Sklar's thesis.

Whereas nineteenth-century businesses were generally family owned or part'nerships, the corporations that emerged in the 1890s were based on the separationof ownership and management. They strove toward "horizontal and verticalintegration" (i.e. they sought to control everything they required from rawmaterial to retail outlets) and were organized into specialized departments (e.g.marketing, finance, etc.). These corporations both needed to supervene overmarket forces - to make rather than take prices - and had the organizational cloutto do so. Unlike nineteenth century businesses that often succumbed to depres­sion, the owner's death, or other mishaps, these corporations have essentiallyproven permanent and, along with their successors, continue to dominate theeconomy. More important, they represented an historically unprecedented levelof rationalization which contemporaries sought to extend to other spheres,including the state. The bulk of Sklar's book does not concern party politics ormass ideology (a point to which I will return) but focuses on the effort to createa legal and administrative infrastructure appropriate to a society in which themarket was no longer dominant.

Sklar discusses four subjects in support of his thesis. First, he shows that keyeconomists of the period rejected the earlier market model according to whichsupply created its own demand. Whereas earlier economists blamed the economicdifficulties of the 1890s on factors assumed to be exogenous to the market (e.g. therailroads, Wall Street) the new economics argued that under conditions ofcorporate organization a competitive market would inevitably "overproduce"thus requiring price-fixing and/or investment abroad. One of the theorists of"overproduction," Arthur Hadley, called the earlier economics a "commercial,"not an "industrial" theory.

Second, Sklar traces the conflict between the 1890s and 1911 in and around theSupreme Court over the meaning of the Sherman Act (passed in 1890) whichforbade "restraints of trade." Sklar argues that the framers of the act neverintended to limit the scope of the modem corporation but were concerned withspecific "unfair practices." A faction of Supreme Court justices, in Sklar's view,used the Act to oppose "trusts" in support of an earlier ideal of the market,according to which all competitors should have roughly the same power. Thus ­until the "rule of reason" decisions in 1911 - for almost fifteen years the legal orderand the unfolding corporate reorganization of industry were out of sync.

Third, Sklar traces the history of the attempt to establish a federal tradecommission to regulate industry as the Interstate Commerce Commission regu-

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REVIEWS 179

lated railroads. The proponents of such a commission, of whom TheodoreRoosevelt was the most important, saw it as an alternative to reliance on thecourts at the same time as they valued the court's war on labor. Above all, thestruggle for a commission (eventually created in its weak or "liberal" form in 1914 )brought the danger of "statism" into focus and was responsible for much ofRoosevelt's profoundly divisive role in American politics, especially after 1910.

Fourth, Sklarcharacterizes the outlooks ofRoosevelt, Wilson and Taft, the firsttwo of whom, Sklar points out, were among the very few of our presidents whowere genuine intellectuals. For Roosevelt, according to Sklar, only an activiststate in command of the economy could preserve both "property rights," and"human rights" in the corporate epoch. Thus Roosevelt, in Sklar's interpretation,directly addressed the socialist critique of capitalism. Taft, on the other hand, heldto the established view that the market, protected by the courts, was the onlysufficient basis for both freedom and self-discipline. Wilson, like Taft, rejectedRoosevelt's statism but made room for a distinctively American kind of polity inwhich a place is made for the state but in which private forces (corporate andotherwise) remain dominant.

How new is Sklar's interpretation of the period? Very. Many historians haveemphasized the importance of the corporation and accompanying changes in thestate but the differences are important. Gabriel Kolko describes the corporationas using the state for immediate or short-term economic gain. Samuel Hays andRobert Wiebe describe a process of universal and inevitable bureaucratization andrationalization proceeding at an even pace everywhere in the society. Christo­pher Lasch describes the rise of experts and administrative authority and traces itto the needs of private capital but, like Hays and Wiebe, he ignores the continuedpredominance of private economic interests alongside a regulatory state. Sklar'swork must be considered another major interpretation of the progressive era andcompared to these and others.

Nonetheless, as such it remains unfinished and, in that sense, unsatisfying. Theproblem, I believe, goes back to Sklar's relative imperviousness to relatedcontemporary work, both social history and neo-Marxism. First, Sklar explicitlydescribes corporate liberalism as a "cross-class ideology" and not "as the ideologyof anyone class, let alone the corporate sector the the capitalist class." (35) If so,almost no sense of the contribution of others than corporate capitalists, profes­sional politicians and government bureaucrats is offered. Sklar mentions"intellectuals...professionals and reformers, workers and trade-union leaders,populists and socialists" as among those who identified with the corporate-liberalsolution but their voices are scarcely found in these pages - unless Sklar believesthat Theodore Roosevelt or Woodrow Wilson adequately spoke for these groups.In an aside Sklar mentions the anti-statist (Le. republican) ideology ofAmericanlabor as contributing to the eventual triumph of corporate liberalism. This is thesort of insight I would wish to see developed.

This problem is linked, in turn, is linked to a difficulty in the Marxist theory thatSklar propounds. Seeking to broaden the conception of capitalism, Sklar rejectsthe base/superstructure model (p. 9) and urges us "to conceive of capitalism notsimply as economics...but as a system of social relations expressed in characteristicclass structures, modes of consciousness, patterns of authority, and relations of

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power." (p. 6) This conception, however, although it points in the right direction,is so broad as to run the danger of losing explanatory power.

In a famous fragment Max Weber argued that modem society wascharacterizedby three discrete types of social relations - class (Le., economic relations), status(e.g. authority, ethnicity, prestige) and power (the political parties and theirorganizations) and that these should not be telescoped together. Weber's asser­tion can be disputed, but it cannot be ignored. I said earlier that one of thestrengths of Foner and Genovese's work on the early nineteenth century lay inlinking economics to politics and culture. It is possible, as Daniel Bell has argued,that these three realms have become increasingly discrete in the twentiethcentury and that Sklar, therefore, faced a more complex - or at least different­theoretical task than Foner and Geneovese.

For example, Sklar fails to distinguish party politics (as opposed to law andadministration) as discrete from, though connected to, the capitalist economy.Sklar casually asserts "a corporate sector of the capitalist class [formed] a politicalleadership poised to act within the class and in national politics." (24, italicsadded) Here, too, he would have been helped by considering the work of Marxist,influenced political scientists such as Amy Bridges and Martin Shefter whodistinguish party politics from class relations and, by distinguishing, relate. Afterall, Sklar cannot properly interpret the writing and speeches of Roosevelt, Taft,and Wilson without considering whether they act as social thinkers or partypoliticians.

These criticisms, however, do not dispel the power and authority of this work.Sklar has recast a series of complicated and technical legal, judicial and admin­istrative arguments to show that those making the arguments were concernedwith nothing less than the relation of the state to society and with ensuring thecontinued predominance of society (private economic forces, though now ad,ministered ones) over the state. Of all the theories of contemporary society wehave, Sklar's, it seems to me, is the only one that even begins to give adequateattention to the continued play of private interests, not only in the economy butin politics and culture as well. If his interpretation is correct, he has certainlyprovided a key to understanding the twentieth century.

University of Missouri, Columbia Eli Zaretsky

The Grounding of Modem Feminism. By Nancy Cott (New Haven:Yale University Press, 1987. xiii plus 372 pp. $29.95).

This superbly researched study describes the development of American feminismbetween 1910,1930. It replaces the old story of the demise of the feministmovement in the 1920s with a more sophisticated understanding of how femi­nism changed, rather than dissolved. Cott's theoretical framework rests on therelation between the concepts of women as equal to men, and women as differentfrom men. She continually stresses the constant tension between the positions ofsexual equality/sexual difference, individualism/solidarity, diversity/unity. Her

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