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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 influential
approach to recent American history while remaining largely uninfluenced by
contemporary academic currents such as social history. In particular, Sklar
espoused the relevance of a certain kind of Marxism to American history before
Marxismbecame fashionable, and he maintains it now that Marxism isonce again
out of fashion. Before the publication of this book he produced, in articles, two
concepts of great significance - corporate liberalism and disaccumulation.
"Corporate liberalism" is an attempt to capture twentieth century liberal
ideology. Since the progressive era, liberalism has presented itself as the use of
government to regulate business in the popular interest. The concept of "corpo-
rate liberalism" points to the role of large-scale corporate interests and their
advocates in formulating this ideology- not as a "conspiracy," nor so much to gain
immediate advantages, but out of a self, conscious - class-conscious - sense of the
need for order and legitimation.
"Disaccumulation" is Sklar's attempt to frame a "law" for corporate capitalism
analogous to the law of accumulation Marx developed for market or competitive
capitalism. Under the terms of the nineteenth century market, increases in
production required increases in labor time, thereby provoking, for example, the
great struggles over the work day. "Disaccumulation" is the idea that in a
corporate-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 the
concept of corporate liberalism to show how the shift from the market to a
corporate dominated economy was accompanied by a transformation in Ameri-
can law and government. Recent historians of nineteenth century America such
as Eric Foner and Eugene Genovese, because they understand capitalism to
involve a politics and culture ("free labor"), as well as a system of economic
relations, have been able to argue, without reductionism, that the development
of 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 to
twentieth century politics and culture.
Most nineteenthcentury Americans believed that the free market was the basis
not onlyof liberty but ofcommunity and individual discipline; hence they viewed
the state as distinctly subordinate to "society," i.e. The play of private economic
forces. The challenge to the market came at the end of the century with the rise
of the large corporations ("trusts") and the dislocation that at first accompanied
them. Many Americans, such as the Populists in Sklar's interpretation, sought to
preserve or restore the market. Others however saw a value in the new corporate
forms and broke with the earlier ideal of market individualism.

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178 journal of social history
Just as the earliest capitalism required advocates, ideology, and political
struggle, sodid this newstage of capitalism, and Sklar speaks of a "movement" for
corporate capitalism. The movement had its external opponents - supporters of
the 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 charac-
ter - its "liberalism" -lies in the fact that the state remained largely subordinate
to private economic forces ("society"); thus "corporate liberal" ideas were able to
win 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 onthe separation
of ownership and management. They strove toward "horizontal and vertical
integration" (i.e. they sought to control everything they required from raw
material to retail outlets) and were organized into specialized departments (e.g.
marketing, finance, etc.). These corporations both needed to supervene over
market forces - to make rather than take prices - and had the organizational clout
to do so. Unlike nineteenth century businesses that often succumbed to depres-
sion, the owner's death, or other mishaps, these corporations have essentially
proven permanent and, along with their successors, continue to dominate the
economy. More important, they represented an historically unprecedented level
of rationalization which contemporaries sought to extend to other spheres,
including the state. The bulk of Sklar's book does not concern party politics or
mass ideology (a point to which I will return) but focuses on the effort to create
a legal and administrative infrastructure appropriate to a society in which the
market was no longer dominant.
Sklar discusses four subjects in support of his thesis. First, he shows that key
economists of the period rejected the earlier market model according to which
supply created its owndemand. Whereas earlier economists blamed the economic
difficulties of the 1890s onfactors assumed to be exogenous to the market (e.g. the
railroads, Wall Street) the new economics argued that under conditions of
corporate 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 the
Supreme Court over the meaning of the Sherman Act (passed in 1890) which
forbade "restraints of trade." Sklar argues that the framers of the act never
intended to limit the scope of the modem corporation but were concerned with
specific "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 order
and the unfolding corporate reorganization of industry were out of sync.
Third, Sklar traces the history of the attempt to establish a federal trade
commission 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 Theodore
Roosevelt was the most important, saw it as an alternative to reliance on the
courts at the same time as they valued the court's war on labor. Above all, the
struggle for a commission (eventuallycreated in its weak or "liberal" form in 1914 )
brought the danger of "statism" into focus and was responsible for much of
Roosevelt's profoundly divisive role in American politics, especially after 1910.
Fourth, Sklar characterizes the outlooks ofRoosevelt, Wilson and Taft, the first
two of whom, Sklar points out, were among the very few of our presidents who
were genuine intellectuals. For Roosevelt, according to Sklar, only an activist
state 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, held
to the established view that the market, protected by the courts, was the only
sufficient basis for both freedom and self-discipline. Wilson, like Taft, rejected
Roosevelt's statism but made room for a distinctively American kind of polity in
which a place is made for the state but in which private forces (corporate and
otherwise) remain dominant.
How new is Sklar's interpretation of the period? Very. Many historians have
emphasized the importance of the corporation and accompanying changes in the
state but the differences are important. Gabriel Kolko describes the corporation
as using the state for immediate or short-term economic gain. Samuel Hays and
Robert Wiebe describe a process of universal and inevitable bureaucratizationand
rationalization proceeding at an even pace everywhere in the society. Christo-
pher Lasch describes the rise of experts and administrative authority and traces it
to the needs of private capital but, like Hays and Wiebe, he ignores the continued
predominance of private economic interests alongside a regulatory state. Sklar's
work must be considered another major interpretation of the progressive era and
compared to these and others.
Nonetheless, as such it remains unfinished and, in that sense, unsatisfying. The
problem, I believe, goes back to Sklar's relative imperviousness to related
contemporary work, both social history and neo-Marxism. First, Sklar explicitly
describes corporate liberalism as a "cross-class ideology" and not "as the ideology
of 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, profes-
sional 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-liberal
solution but their voices are scarcely found in these pages - unless Sklar believes
that Theodore Roosevelt or WoodrowWilson adequately spoke for these groups.
In an aside Sklar mentions the anti-statist (Le. republican) ideology ofAmerican
labor as contributing to the eventual triumph of corporate liberalism. This is the
sort of insight I would wish to see developed.
This problemis linked, in turn, is linked to a difficulty in the Marxist theory that
Sklar propounds. Seeking to broaden the conception of capitalism, Sklar rejects
the base/superstructure model (p. 9) and urges us "to conceive of capitalism not
simply as economics...but as a systemof social relations expressed in characteristic
class structures, modes of consciousness, patterns of authority, and relations of

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180
journal of social history
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 modemsociety was characterized
by three discrete types of social relations - class (Le., economic relations), status
(e.g. authority, ethnicity, prestige) and power (the political parties and their
organizations) and that these should not be telescoped together. Weber's asser-
tion can be disputed, but it cannot be ignored. I said earlier that one of the
strengths of Foner and Genovese's work on the early nineteenth century lay in
linking economics to politics and culture. It is possible, as Daniel Bell has argued,
that these three realms have become increasingly discrete in the twentieth
century and that Sklar, therefore, faced a more complex - or at least different-
theoretical task than Foner and Geneovese.
For example, Sklar fails to distinguish party politics (as opposed to law and
administration) as discrete from, though connected to, the capitalist economy.
Sklar casually asserts "a corporate sector of the capitalist class [formed] a political
leadership poised to act within the class and in national politics." (24, italics
added) Here, too, he would have beenhelped by considering the work of Marxist,
influenced political scientists such as Amy Bridges and Martin Shefter who
distinguish party politics from class relations and, by distinguishing, relate. After
all, Sklar cannot properly interpret the writing and speeches of Roosevelt, Taft,
and Wilson without considering whether they act as social thinkers or party
politicians.
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 admin-
istrative arguments to show that those making the arguments were concerned
with nothing less than the relation of the state to society and with ensuring the
continued predominance of society (private economic forces, though now ad,
ministered ones) over the state. Of all the theories of contemporary society we
have, Sklar's, it seems to me, is the only one that even begins to give adequate
attention to the continued play of private interests, not only in the economy but
in politics and culture as well. If his interpretation is correct, he has certainly
provided 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 feminism
between 1910,1930. It replaces the old story of the demise of the feminist
movement in the 1920s with a more sophisticated understanding of how femi-
nism changed, rather than dissolved. Cott's theoretical framework rests on the
relation between the concepts of women as equal to men, and women as different
from men. She continually stresses the constant tension between the positions of
sexual equality/sexual difference, individualism/solidarity, diversity/unity. Her

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