The State by Anthony de Jasay (44 page)

the "technostructure" soullessly specialist, we have the "unacceptable face of capitalism." When those in charge genuinely want to serve the people and respect its "legitimate aspirations," we get the Prague Spring and "socialism with a human face." It is not so much systems of rule, configurations of power which are conducive to a good or bad life, but rather the sort of people administering them. If the bureaucracy is not "bureaucratic," the corporate executive is "socially minded" and "community-conscious" and the party apparatchik "has not lost contact with the masses," private or state capitalism can be equally tolerable.

1. This is a tempting belief and easy to adopt. In turn, it gives rise to a live concern with how to make sure, or at least how to shorten the odds, that the right sort of people get to play the controlling, administering and managing roles. Each culture has its recipe for recruiting a good bureaucracy. Some place their faith in breeding and a stake in the land (England before the Second World War, as well as Prussia, spring to mind), others in the passing of examinations (France, Imperial China and lately perhaps the USA, are cases in point), while the socialist prescription recommends calloused hands or at least a credible claim to "working-class origins." (Mixed and contradictory criteria should not surprise us. An aristocrat with the common touch, a welder who went on to get an MBA or conversely the graduate who learnt all about life by doing a stint at manual labour, are particularly acceptable recruits into the "power elite." Among contradictory and mixed criteria, minor ones can in time become major. It is said that a contributory cause of Khrushchev's downfall was the embarrassment felt by the Soviet public, especially vis-à-vis the outside world, at his bumptiousness, clowning and lower-class Ukrainian accent.)
   
2. Hopeful ideas about the right way of recruiting the "power elite" and the difference its personnel makes between "savage" and "responsible" capitalism, "despotic" and "democratic" socialism, condition civil society's approval of the composition of the bureaucracy. They also help explain the passionate interest of modern sociology in the statistical parameters of particular hierarchies, for if the behaviour of "power elites" depends critically on where their members come from, it must matter a great deal whose father did what and went to which school. This preoccupation with "socio-economic origins" is really the complete negation of the belief that existence determines consciousness and hence the bureau determines that of the bureaucrat.*66 On the latter view, whether it is principally made up of the sons of toilers, schoolteachers or of other bureaucrats, the institutional interest and hence the conduct of a bureaucracy will be essentially the same, give and take minor cultural variations of style between the moderately nice and the rather nasty. For the former view to hold, the bureaucracy must be completely autonomous and obey no master, in order to be able to follow its own personal tastes and dispositions. For the latter, its master is its own existential, institutional interest, which may or may not happen to coincide with the "maximand" of the ultimate beneficiary the bureaucratic institution is supposed to serve-the state in state capitalism, shareholders in private capitalism. On either view, the bureaucracy calls the tune, though which tune it calls depends on the further particulars. Either view is contingent on the thesis that the owner does not control, the bureaucrat does. How good is this thesis?
   
 

3. In order for the separation of ownership and control to mean what its disparate proponents, from Berle and Means through Trotsky,*67 Burnham and C. W. Mills to Marris and Penrose
   

intend it to mean, it is trivial merely to show that the bureaucracy administers and the managers manage with little apparent reference to their ostensible masters. A more telling argument would be to establish that they have non-trivial discretionary power. Evidence for such discretion would be some measure (if a convenient one could be found) of a divergence between the owner's presumable maximand and the maximand the managers seem in fact to be pursuing.*68

1. This is not really feasible if the future consequences of the manager's present actions are uncertain, hence he can always be supposed to have aimed at consequence A (best for his employer) rather than B (best for him, less good for his employer), regardless of whether the actual result of his action turned out to be A or B. For instance, Montgomery's generalship in North Africa can be seen as self-serving, in that he would only really engage Rommel once his "bureaucratic" insistence on a large sufficiency of resources gave him odds-on chances of spectacular victories. Yet it can always be argued (and it is hard "objectively" to disprove) that though he earned fame at no risk by brazenly "hogging" resources for the Eighth Army, he was in effect serving Britain's best long-term interest (e.g. because the resources he "hogged" would not have done any greater good to the war effort in any other theatre). Likewise, the corporate manager who, in apparent pursuit of self-aggrandizement, goes for market share at the expense of current profit, can always pretend to be making future profit larger than it would otherwise have been-the sort of business school or management consultancy waffle one can dismiss with a shrug but not refute with science.
   
 

2. Nevertheless, it is at least possible deductively to assert that only security of tenure provides the sufficient condition for the state
   

bureaucrat, the corporate manager or other hired power-elitist to exercise discretionary power regularly and in significant conflict with the owner's interest. The corollary of secure tenure is that in delegating control, the owner has somehow awarded it for keeps and has lost the faculty of recall, i.e. he has lost control. The standard argument to this effect is that once ownership has become fragmented and many owners have delegated managerial power to a single tenant (a bureaucracy, a management), each owner has only an infinitesimal influence on the tenant's tenure, and insufficient motivation to shoulder the cost of mobilizing fellow owners for joint action. In technical language, the bureaucratic tenant is protected by an "externality."

1. Precisely such an externality may protect a state from its unorganized subjects. The sheer money value of liberty to the subjects of a despotic state may be much larger than the money cost of suborning the praetorian guard, buying arms, copying machines or whatever it may take to topple such a regime. Yet no political entrepreneur would come forth and shoulder the cost if he considered it impracticable to recover it from the liberated subjects. He would lose his outlay if their liberty were an externality for which they could not be made to pay (except by enslaving them again).
   
 

2. The most casual reader of the financial pages of newspapers knows, however, that there is no such obstacle to organizing revolt against self-serving or just plain unsuccessful corporate managements. The take-over bidder, conglomerator, "raider," "asset stripper," proxy solicitor have (despite the regulatory hurdles well-meaning authorities put in their way) several ways of "internalizing" some of the potential benefit accruing to the owners from the recall of the sitting management. These ways can
   

be devious and unscrupulous, in keeping with the unscrupulous defences (such as "scorched earth," self-denunciation on anti-trust grounds and "saturation bombing" with frivolous lawsuits) put up by sitting managements to "protect corporate property" from shareholders at the latter's expense. All in all, "unfriendly" takeovers even in the face of desperate defences are often successful enough to shake the average hired management's confidence in its security of tenure.*69

1. If the hold of the bureaucracy is precarious in the face of an unorganized multitude of dispersed owners, it is a fortiori precarious in the face of a single, concentrated owner. No externality protects the bureaucracy from the state it is supposed to serve. The discretionary power of a bureaucrat or a bureaucratic institution, no matter how important in the whole apparatus of the state, must not be confused with that of the state proper from which it is derived.
   
 

2. Nor is there much excuse for falling into traps of the "good king, bad councillors" or conversely the "wicked lord, kind-hearted bailiff" type. The bailiff may be kind-hearted, close to the villeins and especially to any relatives he may have among them, but his personal interest is seldom so far divorced from that of the lord as to make him let off the serfs all that lightly. He, too, wants the manor to function properly as a going concern. The reason the bureaucracy on the whole does serve the state's ends is not only that it has to, on pain of losing its precarious place, but also that, except in rare and easily identified historical situations where state power has just passed to an invader, a usurper or at least a culturally alien contender, there is a large and genuine harmony between their respective maximands. The greater the discretionary power of the state, the more scope the bureaucrat is likely to have
   

for the fulfilment of his ends. He need not have the same ends the state is striving to realize. It is sufficient that his ends should be non-competing or subordinated. A loyal bureaucracy will find much of its happiness in a strong state. It would take disloyalty, safety from being found out, or perhaps a credible excuse in terms of the "real," "long-term" interest of the state, for it to side with civil society against its master. The chance of imposing its own will on both state and civil society by acting the role of ruling class looks, for all these reasons, doubly remote.

1. The true place and role of the bureaucracy in relation to the state were suggestively summed up by the historian Norbert Elias in what he called the Monopoly Mechanism. The state is the monopolist of "the army, land and money" while the bureaucracy is the body of "dependents upon whom the monopolist depends." Of course the dependents are important, of course their qualities, their human types are interrelated with the type of state which depends on them; in Elias's example, while the free feudal nobility went with an earlier type, a later one produced the courtly nobility.*70 In a less neat sequence, we might add the clerics, the lay legists and commoner court servants, the landless administrative nobility, Chinese mandarins, Prussian Junkers, French "enarques," American congressional staffers, dollar-a-year men and socialist party apparatchiks. Within each type, there is no doubt room for human variations leaving their stamp on the life of the society they help administer. Undeniably, they can lend socialism a human face, or an inhuman one. It is very much a matter of each subject's personal destiny what proves to be of greater import to him, the system or its face.
   
 

2. For any schema of social explanation which runs in terms of classes, however, putting the bureaucracy or some rough
   

equivalent administrative, managerial, insider, expert and authority-carrying category in the place of the ruling class is liable to prove confusing. Doing so is to attribute to such a category a durable and well-defined identity ("the New Class"?), a degree of discretionary power and a liberty of action which it can in general hardly possess. It is to lose sight of the political significance of the pattern of capital ownership, reducing it to irrelevance in terms of power over others. Finally, it is by implication to allot to the human qualities of this category an overriding influence on the quality of social life, as if the variable disposition and character of office-holders could altogether swamp the systemic constants which are the source of the power delegated to such offices. Confusion of this sort yields such gems of incomprehension as that a certain despotism was, or has resulted from, "bureaucratic distortion" or the "personality cult." If the system of state capitalism is to be thought of in traditional class terms, the role of the ruling class can only be ascribed to the state itself. This imposes no anthropomorphism and does not require the state to be personified by a monarch, a dictator or the party elders. Nor need it be identified with a specific institution, assembly, central committee or cabinet. More non-committally and generally, it is sufficient for the state (to adapt a famous phrase of Marx) to be armed force and capital endowed with consciousness and a will.*71

5.2.2
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Author: Jasay, Anthony de Title: The State

Anthony de Jasay
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5.
State CapitalismOn the Plantation

Money, markets and the habit of choice are best weeded out by shaping the social system as a well-run plantation.

1. The universal employer, not content with pushing string, will have to end up owning his employees.
   
 

2. Completing mastery over civil society in maximizing discretionary power can be seen as a chain of corrective moves, each one being aimed at making the social system both amenable to the state's purpose and internally consistent, although these two requirements are not necessarily or even probably compatible. Each corrective move is consequently capable of creating some new systemic inconsistency and of necessitating other corrective moves. This sequence drives in the political dynamics, such as it is, of state capitalism.
   
 

3. The first and perhaps most decisive of these moves, whereby civil society is purged of decentralized capitalist ownership and the