6 - The Chief Executives

M ANY of those who are disposed to celebrate the American economy rest their case upon a curious jumble of notions about the chief executives of the big corporations.

 

Within the free, private, enterprising system, it is said, there has arisen a set of executives who are quite distinct from the 'crude old-fashioned entrepreneurs' out for themselves in the ruthless ways of a capitalism now long dead.

 

These executives, who have risen to the top, have come to be responsible trustees, impartial umpires, and expert brokers for a plurality of economic interests, including those of all the millions of small property holders who hold stock in the great American enterprises, but also the wage workers and the consumers who benefit from the great flow of goods and services.

These executives, it is held, are responsible for the refrigerator in the kitchen and the automobile in the garage - as well as all the planes and bombs that now guard Americans from instant peril. All of them, or nearly all, have come up from the bottom of the ladder; they are either farm boys who have now made good in the big city, or poor immigrants who have come to America and now enjoy the dream of success it allows.

 

Full of the know-how that made America great; efficient, straightforward, honest, the chief executives, it is often said, ought really to be allowed to run the government, for if only such men were in charge there would be no waste, no corruption, no infiltration. Dirty politics, in short, would become clean business.

On a slightly higher level of sophistication, however, rather unpleasant things are said about the executives. After all, they are powerful men, rather new men of power, but upon what basis does their power rest? They are not the owners of the corporate properties, and yet they run the corporate show.

 

If their interests are quite distinct from the interests of the rightful owners,

• Just what are those interests?

• Have not these chief executives carried through a silent revolution, a managerial revolution from the top, and has not their revolution transformed the very meaning of property?

• Are not, in short, the old expropriators now expropriated by their salaried managers?

• Maybe the chief executives are trustees for a variety of economic interests, but what are the checks upon how fair and well they perform their trusts?

• And was it not the state, subject to the control of a free electorate, that was to be the responsible trustee, the impartial umpire, the expert broker of conflicting interests and contending powers?

Both the pleasantries and the unpleasantries about the executives are generally wrong and equally jumbled.

 

The pleasantries are often mere kindergarten chatter for economic illiterates; the unpleasantries often rest on some very fast inferences from a few simple facts about the scale, the organization, and the meaning of private property in America. For in the agreeable as well as the disagreeable notions about the higher economic circles, one simple fact is often overlooked: the chief executives and the very rich are not two distinct and clearly segregated groups.

 

They are both very much mixed up in the corporate world of property and privilege, and to understand either we must understand something of the upper levels of their corporate world.
 

1 - The corporations are the organized centers of the private property system: the chief executives are the organizers of that system.

 

As economic men, they are at once creatures and creators of the corporate revolution, which, in brief, has transformed property from a tool of the workman into an elaborate instrument by which his work is controlled and a profit extracted from it.

 

The small entrepreneur is no longer the key to the economic life of America; and in many economic sectors where small producers and distributors do still exist they strive mightily - as indeed they must if they are not to be extinguished - to have trade associations or governments act for them as corporations act for big industry and finance.¹

Americans like to think of themselves as the most individualistic people in the world, but among them the impersonal corporation has proceeded the farthest and now reaches into every area and detail of daily life. Less than two-tenths of 1 per cent of all the manufacturing and mining companies in the United States now employ half of all the people working in these basic industries.²

 

The story of the American economy since the Civil War is thus the story of the creation and consolidation of this corporate world of centralized property.

1. In the development of each major industrial line, competition between many small firms tends to be most frequent at the industry's beginning. There is then a jockeying and maneuvering which, in due course, results in consolidation and merger.

    

   Out of the youthful competition, there emerges the Big Five, or the Big Three, as the case may be: a small set of firms which shares what there is to share of the industry's profits, and which dominates the decisions made by and for the industry.

    

   1. 'The power exercised by a few large firms,' John K. Galbraith has remarked, 'is different only in degree and precision of its exercise from that of the single-firm monopoly.'³

    

   If they compete with one another they do so less in terms of price than in terms of 'product development,' advertising, and packaging.4 No single firm among them decides, but neither is the decision made impersonally by a competitive, autonomous market. There is simply too much at stake for that sort of slipshod method to be the going rule.

    

   Decisions become, explicitly or implicitly, the decisions of committees; the Big Three or Four, one way or another, are in on the major decisions that are rendered. In this there need be no explicit conspiracy, and certainly none that is provable. What is important is that each big producer makes his decisions on the basis of his impression of the reactions of the other big producers.
   
    

2. In the process of corporate consolidation many owning entrepreneurs and even salaried managers become too narrow; they cannot detach themselves from their own particular company. Managers with less personal feelings for any one firm come gradually to displace such men narrowed by their own experience and interests.

    

   On the higher levels, those in command of great corporations must be able to broaden their views in order to become industrial spokesmen rather than merely heads of one or the other of the great firms in the industry. In short, they must be able to move from one company's policy and interests to those of the industry.

    

   There is one more step which some of them take: They move from the industrial point of interest and outlook to the interests and outlook of the class of all big corporate property as a whole.
   
   The transitions from company to industry and from industry to class are aided by the fact that corporate ownership is, in a limited way, scattered. The very fact of the spread of ownership among the very rich and the chief executives of the great corporations makes for a unity of the property class, since the control of many corporations by means of various legal devices has excluded the smaller but not the larger propertied interests.⁵

    

   The 'scatter' of sizeable property is within a quite small circle; the executives and owners who are in and of and for this propertied class cannot merely push the narrow interests of each property; their interests become engaged by the whole corporate class.
   
    

3. The six and a half million people who owned stock in publicly held corporations in 1952 made up less than 7 per cent of all adults in the population.⁶ But that is not the whole story; in fact, by itself, it is misleading. What is important is, first, what types of people own any stock? And second, how concentrated is the value of the stock they own?
   
   First of all: 45 per cent of the executives, 26 per cent of all professional persons, and 19 per cent of all supervisory officials hold stock. But only 0.2 per cent of the unskilled workers, 1.4 per cent of the semi-skilled workers, and 4.4 per cent of foremen and skilled workers hold stock.7 Some 98.6 per cent of all workers in manufacturing own no stock whatsoever.
   
   Second, in 1952, only 1.6 million (25 per cent) of the 6.5 million people who held any stock received as much as $10,000 per year from any and all sources. We do not know how much of that $10,000 came from dividends, but there is reason to believe that the average proportion was not great.8 In 1949, some 165,000 -  about one-tenth of 1 per cent of all U.S. adults - received 42 per cent of all the corporate dividends going to individuals. The minimum income of these people for that year was $30,000.⁹

    

   The idea of a really wide distribution of economic ownership is a cultivated illusion: at the very most, 0.2 or 0.3 per cent of the adult population own the bulk, the pay-off shares, of the corporate world.
   
    

4. The top corporations are not a set of splendidly isolated giants. They have been knit together by explicit associations, within their respective industries and regions and in supra-associations such as the NAM. These associations organize a unity among the managerial elite and other members of the corporate rich.

    

   They translate narrow economic powers into industry-wide and class-wide powers; and they use these powers, first, on the economic front, for example with reference to labor and its organizations; and, second,' on the political front, for example in their large role in the political sphere. And they infuse into the ranks of smaller businessmen the views of big business.
   
   When such associations appear to be unwieldy, containing conflicting lines of argument, cliques have emerged within them which have attempted to steer their programs and lend direction to their policies.¹⁰ In the higher circles of business and its associations, there has long been a tension, for example, between the 'old guard' of practical conservatives and the 'business liberals,' or sophisticated conservatives.¹¹

    

   What the old guard represents is the outlook, if not always the intelligent interests, of the more narrow economic concerns. What the business liberals represent is the outlook and the interests of the newer propertied class as a whole.

    

   They are 'sophisticated' because they are more flexible in adjusting to such political facts of life as the New Deal and big labor, because they have taken over and used the dominant liberal rhetoric for their own purposes, and because they have, in general, attempted to get on top of, or even slightly ahead of, the trend of these developments, rather than to fight it as practical conservatives are wont to do.
   
    

5. The growth and interconnections of the corporations, in short, have meant the rise of a more sophisticated executive elite which now possesses a certain autonomy from any specific property interest. Its power is the power of property, but that property is not always or even usually of one coherent and narrow type. It is, in operating fact, class-wide property.
   
   Would it not, after all, be quite strange if, in a country so devoted to private property and where so much of it is now piled up, and in an atmosphere which in the last fifty years has often been quite hostile, where men of economic means also possess, we are continually told, the greatest administrative and managerial ability in the world - would it not be strange if they did not consolidate themselves, but merely drifted along, doing the best they could, merely responding to day-to-day attacks upon them?
   
    

6. Such consolidation of the corporate world is underlined by the fact that within it there is an elaborate network of interlocking directorships. 'Interlocking Directorate' is no mere phrase: it points to a solid feature of the facts of business life, and to a sociological anchor of the community of interest, the unification of outlook and policy, that prevails among the propertied class.

    

   Any detailed analysis of any major piece of business comes upon this fact, especially when the business involves politics. As a minimum inference, it must be said that such arrangements permit an interchange of views in a convenient and more or less formal way among those who share the interests of the corporate rich. In fact, if there were not such overlapping directorships, we should suspect the existence of less formal, although quite adequate, channels of contact.

    

   For the statistics of interlocking directorates do not form a clean index to the unity of the corporate world or the co-ordination of its policy: there can be and there is coordinated policy without interlocking directors, as well as interlocking directors without coordinated policy.¹²
   
    

7. Most of the thirty-odd billion dollar corporations of today began in the nineteenth century. Their growth was made possible not only by machine technology but by the now primitive office instruments of typewriters, calculators, telephones, and rapid printing, and, of course, the transportation grid.

    

   Now the technique of electronic communication and control of information is becoming such that further centralization is entirely possible. Closed-circuit television and the electronic calculator put control of an enormous array of production units - no matter now decentralized such technical units may be - under the control of the man in the front office.

    

   The intricately specialized apparatus of the corporation will inevitably be more easily held together and controlled.
   
   The trend within the corporate world is toward larger financial units tied into intricate management networks far more centralized than is the case today. Productivity has and will increase fabulously, especially when automation makes it possible to interlock several machines in such a way as to eliminate the need for much of the human control at the point of production that is now required.

    

   That means that the corporate executives will not need to manage huge organizations of people; rather, in Business Week's words, they will be 'operating great mechanical organizations using fewer and fewer people.'¹³

All this has not been and is not now inevitable; certainly the enormous size of the modern corporation cannot be explained as due to increased efficiency; many specialists regard the size now typical of the giants as already in excess of the requirements of efficiency.

 

In truth, the relationship of corporate size to efficiency is quite unknown; moreover, the scale of the modern corporation is usually due more to financial and managerial amalgamations than to technical efficiency.*

 

 

* 'At the very least,' John M. Blair of the Federal Trade Commission has contended, 'the widely-held assumption that the ownership and control of plural production units by single corporate enterprises contributes to efficiency would seem to rest upon an overwhelming absence of supportable facts. The only noticeable gain achieved by these large corporations is in the purchase of materials, which undoubtedly results more from their superior buying power than any technological or managerial efficiency.'¹⁴

 

 

But inevitable or not, the fact is that today the great American corporations seem more like states within states than simply private businesses. The economy of America has been largely incorporated, and within their incorporation the corporate chiefs have captured the technological innovation, accumulated the existing great fortunes as well as much lesser, scattered wealth, and capitalized the future. Within the financial and political boundaries of the corporation, the industrial revolution itself has been concentrated.

 

Corporations command raw materials, and the patents on inventions with which to turn them into finished products. They command the most expensive, and therefore what must be the finest, legal minds in the world, to invent and to refine their defenses and their strategies. They employ man as producer and they make that which he buys as consumer.

 

They clothe him and feed him and invest his money. They make that with which he fights the wars and they finance the ballyhoo of advertisement and the obscurantist bunk of public relations that surround him during the wars and between them.

Their private decisions, responsibly made in the interests of the feudal-like world of private property and income, determine the size and shape of the national economy, the level of employment, the purchasing power of the consumer, the prices that are advertised, the investments that are channeled.

 

Not 'Wall Street financiers' or bankers, but large owners and executives in their self-financing corporations hold the keys of economic power. Not the politicians of the visible government, but the chief executives who sit in the political directorate, by fact and by proxy, hold the power and the means of defending the privileges of their corporate world.

 

If they do not reign, they do govern at many of the vital points of everyday life in America, and no powers effectively and consistently countervail against them, nor have they as corporate-made men developed any effectively restraining conscience.*
 

* Neither the search for a new equilibrium of countervailing power conducted by the economist, John K. Galbraith, nor the search for a restraining corporate conscience, conducted by the legal theorist, A. A. Berle, Jr., is convincing. Both are concerned to show the restraints upon the acknowledged powers of the corporation: Galbraith finding it from without, in a new version of the equilibrium theory; Berle, from within, in an odd view of the conscience of the powerful.
 

I. Many exceptions must be noted to any equilibrium that may prevail among the new giants. Some industries are integrated from the source of supply to the ultimate consumer; and in some industries, such as residential construction, the individual contractor is squeezed between strong craft unions and strong suppliers, rather than balancing with them. Moreover, as is recognized by Mr. Galbraith himself, 'countervailing power' does not work in periods of inflation, for then the corporation's resistance to wage demands is reduced, and it is easy to pass on the increased costs to the consumer, whose demands, in turn, are so strong that the retailer is pressed to satisfy them, and thus cannot wield his power against the corporate producer. In such times, the big units, far from being held in counterbalance, become a 'coalition against the public' The big power blocs gang up on the consumer, rather than benefit him by countervailing against one another. It also would seem that market power does not exactly 'generate' countervailing power: with the exception of railroading, strong unions did not develop in strong industries, until government backed them up in the 'thirties. Nor do chain stores prosper in counterbalance to automobiles or petroleum but rather in the relatively unconcentrated field of food suppliers. The new equilibrium, in short, is not self-regulating. To know that power does not automatically 'beget' its countervailing power, one has only to think of farm laborers and white-collar employees. But the weaker unit, Mr. Galbraith urges, ought to organize an opposition; then perhaps it will be able to get the aid of government, and government should support the weaker side of any imbalance. Thus weakness, as well as strength, is to lead to countervailing power, and the theory of the big equilibrium becomes less a theory of the going fact than a suggested guideline to public policy, a moral proposal for strategic action. Moreover, it is assumed that the government is less an integral element of the balance than an umpire biased toward shoring up those with weak market power. When the conceptions of the big balance are laid alongside the qualifications and exceptions which must be made, they do not seem so compelling as the bold initial statement of 'countervailing power.' Like the 'competition' among little entrepreneurs, which it is designed to replace, 'countervailing power' among the big blocs is more ideological hope than factual description, more dogma than realism.15

II. As for Mr. Berle's search for a corporate conscience, see the remainder of this chapter for an account of the men who have presumably developed it. In a money-economy, expediency may follow the longer or the shorter run. Their inclination for longer-run profits, for a stable take, in an economy integrated with political institutions and shored up by military purchases, requires that corporations become more political; and today they are, of course, as much political as economic institutions. As political institutions, they are of course totalitarian and dictatorial, although externally, they display much public relation and liberal rhetoric of defense. Mr. Berle, in brief, mistakes expedient public relations for a 'corporate soul.'16

 

 

2 - The corporate world is only two or three generations old, yet even in this short time, it has selected and created certain types of men who have risen with it and within it.

 

What manner of men are they? We are not here interested in the bulk of the corporate managers, nor in any average executive - if such a conception is meaningful and revealing. We are interested in the very top men of the corporate world - top according to the criteria which they themselves use in grading one another: the controlling positions they occupy.

The chief, executives are the men who occupy the top two or three command posts in each of those hundred or so corporations which, measured by sales and capital, are the largest. If, in any one year we list these leading corporations, in all industrial lines, and from their top levels select the presidents and the chairmen of their boards, we shall have listed the chief executives. We have six or seven careful studies of such executives, covering the period of the last century.¹⁷

Are the top executives of the big corporations a distinct breed of men, or are they merely a miscellaneous collection of Americans? Are they what Balzac would have called a genuine social type? Or do they represent a cross-section of Americans who happen to be successful? The top executives of the big companies are not, and never have been, a miscellaneous collection of Americans; they are a quite uniform social type which has had exceptional advantages of origin and training, and they do not fit many of the stereotypes that prevail about them.

The top executives of 1950 are not country boys who have made good in the city: whereas 60 per cent of the population about the time of their birth, in 1890, lived in rural areas, only 35 per cent of the 1950 executives were bom in rural communities. And this was even more true in 'the good old days': even in 1870, only half of the executives were farm born, compared with 93 per cent of the 1820 population.

They are not immigrants, poor or rich, or even the sons oi immigrants who have made good in America. The families of about half of the 1950 executives settled in America before the revolution - which is not a much different proportion than among the population at large, and which of course represents a decline from the 1870 executives, of whom 86 per cent were of colonial families.

 

Yet only 8 per cent of the post-Civil-War executives have been foreign-born - and only 6 per cent of the 1950 set, less than half the 15 per cent foreign-born among the representative population at the time of their birth. The proportion of sons of the foreign-born - of the second generation - has increased, especially in the newer industries of distribution and mass entertainment and communication; but it still remains below the representative level. Over three-quarters of the 1950 executives are American-born of American-born fathers.

The business executives are predominately Protestant and more likely, in comparison with the proportions of the population at large, to he Episcopalians or Presbyterians than Baptists or Methodists. The Jews and Catholics among them are fewer than among the population at large.

These urban, white, Protestant Americans were born into families of the upper and upper-middle classes.

 

Their fathers were mainly entrepreneurs:

• 57 per cent are sons of businessmen

• 14 per cent, of professional men

• 15 per cent, of farmers

Only 12 per cent are sons of wage workers or of lower white-collar employees.

 

This entrepreneurial origin more emphatically sets the executives off as a group apart when we remember that at the time of their start in life - around 1900 - only 8 per cent of all the men at work in America were businessmen, only 3 per cent were professional men. Some 25 per cent were then 'farmers' - an ambiguous term - and almost 60 per cent, five times greater a proportion than among the executives, were in wage or salary work.

Moreover, apart from a decline in farm boys, the executives of the entire post-Civil-War era are substantially similar in occupational origin. At any period, over 60 per cent - usually closer to 70  - of American executives have been from the business and professional classes; and never more than 10 or 12 per cent from the wage worker or lower white-collar employee level.

 

In fact, only 8 per cent of the paternal grandfathers of the 1950 executives were wage or office workers, while 57 per cent of the male population were. Of these grandfathers, 54 per cent were business or professional, at a time when no more than 9 per cent of the male population was; 33 per cent of the grandfathers were farmers or planters, roughly the same as the general male population.

For at least two generations now, the families of the top executives of the big American corporations have, as a group, been far removed from wage work and the lower white-collar ranks. In fact, their families are in a substantial proportion citizens of good repute in the local societies of America. And only 2 1/2 per cent of the top executives who were under 50 years of age in 1952 (the newest crop) come up from the ranks of wage-worker families.¹⁸

Back in 1870, not more than 1 or 2 per cent of adult American men had graduated from college, but about one-third of the 1870 executives had. Among today's executives, nine times as great a proportion (60 per cent) are college graduates as among the comparable white males between 45 and 55 years of age (7 per cent).

 

Moreover, almost half of them have had formal educational training beyond college, 15 per cent in law, 15 per cent in engineering, and about the same proportion in miscellaneous courses and schools.¹⁹

The typical executives, today as in the past, were born with a big advantage: they managed to have fathers on at least upper middle-class levels of occupation and income; they are Protestant, white, and American-born. These factors of origin led directly to their second big advantage: they are well educated in the formal sense of college and post-college schooling.

 

That such facts of origin were keys to their educational advantages is clear from the simple fact that among them - as among any group we might study - those with the highest origins have had the best chances for formal education.

The salaries of the executives vary somewhat by the industry they are in, but in 1950 the top 900 executives averaged about $70,000 a year; the chief executive officers among them, about $100,000.20 But salaries are not typically their only source of income. In the briefcases of virtually every major executive there is a portfolio ready for additional stock certificates.

 

There are many places of secure anchorage in the corporate world,* but the most secure is the position of the owner of big pieces of corporate property.

 

 

* See below, SEVEN: The Corporate Rich.
 

 

In the big corporation the fact that the executives do not own the property they manage means that by their decisions they do not risk their own property.

 

When the profits are high they continue to receive high salaries and bonuses. When they don't go so well, their salaries often continue quite high even though their bonuses drop. The bulk of executives today, in addition to salary payments, received bonuses, either in stock or cash,' and often in installments over a period of years.²¹

 

In 1952, among the highest paid executives were,

• Crawford Greenewalt, President of E.I. du Pont de Nemours and Co., with $153,290 in salary and $350,000 in bonuses

• Harlow Curtice, then one of four executive vice-presidents of General Motors, received $151,200 in salary and $370,000 in bonuses

• Eugene G. Grace, President of Bethlehem Steel Corp., received $150,000 as salary and $306,652 in bonuses

• Charles E. Wilson, with his much-publicized salary and stockholdings, was the highest paid executive in American industry: $201,000 in salary and $380,000 in bonuses, plus an unknown amount in dividends.²²

The executives do not constitute a leisure class,'²³ but they are not without the higher comforts.

 

By the time they are fifty or sixty years of age, most chief executives have impressive houses, usually in the country, but not too far from 'their cities.' Whether they also have places in town depends somewhat on the city - they are more likely to in New York or Boston than in Los Angeles.

 

Now they are receiving large incomes, from their salaries as well as from dividends which may amount to as much or more. And so at about this point they branch out in a variety of ways.

 

Many acquire sizable farms and go in for raising fancy livestock. Wilson, of Detroit and Washington, has Ayrshire cattle on his Michigan farm and plans to experiment with a new breed on his Louisiana plantation.²⁴

 

Cyrus Eaton has short-horn cattle. Mr. Eisenhower, in his smaller way, now emulates his models with Aberdeen-Angus. The executives are definitely numerous among the three or four thousand people who own boats of over 65 feet or 15 ton displacement. They may even ride to hounds, and moreover, like Mr. George Humphrey, wear pink coats while doing so.

 

The leisure of many chief executives is taken up by country places and a good deal of hunting. Some fly by private plane to the Canadian woods, others have private cabanas at Miami or Hobe Sound.

It is not characteristic of American executives to read books, except books on 'management' and mysteries:

'The majority of top executives almost never read drama, great fiction, the philosophers, the poets. Those who do venture into this area,  are definitely sports of the executive type, looked upon by their colleagues with mingled awe and incredulity.'²⁵

Executive circles do not overlap very much with those of artistic or literary interest.

 

Among them are those who resent reading a report or a letter longer than one page, such avoidance of words being rather general. They seem somehow suspicious of long-winded speeches, except when they are the speakers, and they do not, of course, have the time. They are very much of the age of the 'briefing,' of the digest, of the two-paragraph memo.

 

Such reading as they do, they often delegate to others, who clip and summarize for them. They are talkers and listeners rather than readers or writers. They pick up much of what they know at the conference table and from friends in other fields.
 

 

3 - If we attempt to draw blueprints of the external careers of the executives, we find several more or less distinct types:

1. Entrepreneurs, by definition, start or organize a business with their own or with others' funds, and as the business grows so does their stature as executives. Less educated than other executives, this type tends to begin working at an earlier age and to have worked in several companies. According to the careful tally of Miss Suzanne I. Keller, a grand total of 6 per cent of the top corporation executives in 1950 America have followed such an entrepreneurial route to the top.
   
    

2. Some executives have been placed in companies owned by their fathers or other relatives and have subsequently inherited their positions. These men tend to begin work later in their lives than other types, and frequently never work in companies other than the one in which they eventually come to the top. In these companies, however, they often work for considerable periods before assuming the key posts of command. Some 11 per cent of the 1950 executives are such family-managers.
   
    

3. Another 13 per cent did not begin in business at all, but as professional men, primarily lawyers. Their work in their profession leads - usually after professional success - to their becoming corporation presidents or board chairmen.

    

   As the incorporation of the economy got under way, William Miller has noted, corporations felt the need, on the one hand, to get in touch with lawyers in public office and, on the other,

   • 'to have growing recourse to private legal advice in the making of day to day business decisions. The demand for such advice, indeed, became so great that the best paid metropolitan lawyers almost without exception after 1900 made business counseling the focus of their work, at the expense of traditional advocacy; and many lawyers yielded to the blandishments of the corporations to become house counsel and even regular business executives themselves.'²⁶

    

   Today, the success of the corporation depends to a considerable extent upon minimizing its tax burden, maximizing its speculative projects through mergers, controlling government regulatory bodies, influencing state and national legislatures. Accordingly, the lawyer is becoming a pivotal figure in the giant corporation.
   
    

4. These three types of careers - entrepreneurial, family, and professional - have been followed by about one-third of the top 1950 executives. The external career-line of the remaining 68 per cent is a series of moves, over a long period of time, within and between the various levels and circles of the corporate business world

Two generations ago, 36 per cent of the executives - as compared with only 6 per cent today - were entrepreneurial; 32 per cent were family-managers, as against 11 per cent today; there were about the same proportion then of professional men, 14 per cent, as now, 13 per cent. Steadily and swiftly - from 18 per cent in 1870 to 68 per cent in 1950 - the career of the business executive has become a movement within and between the corporate hierarchies.

If we examine the careers of 900 top 1950 executives - the largest group of contemporary executives whose careers have been studied - we find that the bulk of them began their work for large companies, and that about one-third of them have never worked for any other company than the one they now head. The greater number worked for one or two other companies, and over 20 per cent worked for three or four. So there is typically some criss-crossing of corporate boundaries in their climb.

 

Even so, their average age when they were hired by their present company was about twenty-nine.

About a third, as one might expect on the basis of their origin and education, started in their present company as executives. Well over a third - in fact 44 per cent - started in various 'departments.' That leaves about 24 per cent who started as clerks or laborers. We must, however, be careful about interpreting such figures.

 

Low jobs in themselves do not mean anything, especially when one considers the backgrounds and higher educations of these executives. The taking of a clerical or, much better, a labor job for awhile 'to learn the business' is often a sort of ritual for some families and some companies. At any rate, more of the chief executives started on the executive level; more of the younger men started in the more specialized departments.

 

For example, over one-third of those under 50 had a position in 'sales' just before their top jobs.²⁷

Those are the outside facts of the executive's career. But the outside facts, no matter how added up, are not inside facts. There is the bureaucratic crawl and there is the entrepreneurial leap. But there is also the deal of the fixer, the coup of the promoter, the maneuver of the clique.

 

Words like entrepreneur and bureaucrat are no more adequate to convey the realities of the higher corporate career than of the appropriation of great fortunes. They are, as we have noted in connection with the very rich, middle-class words, and retain the limitations of middle-class perspectives.

'Entrepreneur' suggests the picture of a man with all the risks of life about him, soberly founding an enterprise and carefully nurturing its growth into a great company. In 1950, a far more accurate picture of the 'entrepreneurial' activity of the corporate elite is the setting up of a financial deal which merges one set of files with another. The chief executives of today do less building up of new organizations than carrying on of established ones.

 

And, as Robert A. Gordon has indicated, they are less creative, restless, dynamic individuals than professional coordinators of decisions,

'approving decisions that flow up... from... subordinates, but doing less and less initiation.'²⁸

It is usual in studies of business executives to term such a career, 'bureaucratic,' but, strictly speaking, this is not correct.

 

The bureaucratic career, properly defined, does not mean merely a climb up, from one level to the next, of a hierarchy of offices. It does involve that, but more importantly, it means the setting up of strict and unilateral qualifications for each office occupied. Usually these qualifications involve both specified formal training and qualifying examinations.

 

The bureaucratic career also means that men work for salaried advancement without any expectation of coming to own even a part of the enterprise, of personally appropriating a portion of the accumulated property of the enterprise, by bonuses or stock options or lavish pension and insurance plans.*

 

* For more on the bureaucratic career, see below ELEVEN: The Theory of Balance.

Just as the word 'entrepreneur,' as used to refer to the career of the very rich of today, is often misleading, so the word 'bureaucratic,' as used to refer to corporation executives on the higher levels, is misleading.

 

Both the advancement of the chief executives and the accumulations of the very rich, on the higher levels, are definitely mixed up in a 'political' world of corporate cliques. To advance within and between private corporate hierarchies means to be chosen for advancement by your superiors - administrative and financial - and there are no strict, impersonal rules of qualifications or seniority known to all concerned in this process.

 

On the higher levels of the corporate world, careers are neither 'bureaucratic' nor 'entrepreneurial;' they are a composite of payoffs, involving speculators, men with great American fortunes, and executives in jobs with chances to make money. The owners alone can no longer say with William H. Vanderbilt in 1882, 'The public be Damned.' Neither can the professional executives alone.

 

Together - as a set of corporate cliques - they can say what they want, although today they are usually too wise in the ways of public relations to say it, and besides they do not need to say it.

 

 

4 - There is, of course, no one type of corporate hierarchy, but one general feature of the corporate world does seem to prevail quite widely. It involves a Number One stratum at the top whose members as individuals - and increasingly as committees - advise and counsel and receive reports from a Number Two stratum of operating managers.²⁹

It is of the Number One stratum that the very rich and the chief executives are a part. The Number Two men are individually responsible for given units, plants, departments. They stand between the active working hierarchies and the directing top to which they are responsible. And in their monthly and yearly reports to the top executives, one simple set of questions is foremost: Did we make money: If so, how much? If not, why not?

Decision-making by individual executives at the top is slowly being replaced by the worried-over efforts of committees, who judge ideas tossed before them, usually from below the top levels. The technical men, for example, may negotiate for months with the salesmen over a tubeless tire before the chief executives descend to operation-level conferences.³⁰

 

Theirs is not the idea nor even the decision, but The Judgment. On the top levels this judgment usually has to do with the spending of money to make more money and the getting of others to do the work involved. The 'running' of a large business consists essentially of getting somebody to make something which somebody else will sell to somebody else for more than it costs.

 

John L. McCaffrey, the chief executive of International Harvester, recently said,

'...he [a business president] seldom lies awake very long thinking about finances or law suits or sales or production or engineering or accounting problems... When he approaches such problems the president can bring to bear on them all the energy and the trained judgment and past experience of his whole organization.'

And he goes on to say what top executives do think about at night: 'the biggest trouble with industry is that it is full of human beings.'

The human beings on the middle levels are mainly specialists. 'We sit at our desks all day,' this chief executive continues, 'while around us whiz and gyrate a vast number of special activities, some of which we only dimly understand.

 

And for each of these activities, there is a specialist. . . All of them, no doubt, are good to have. All seem to be necessary. All are useful on frequent occasions. But it has reached the point where the greatest task of the president is to understand enough of all these specialties so that when a problem comes up he can assign the right team of experts to work on it... How can he maintain the interest of and get full advantage from the specialists who are too specialized to promote?

 

On the one hand, the company absolutely requires the skills of the specialists in order to carry on its complicated operations. On the other hand, he has to get future top management from somewhere. And that somewhere has to be largely within the existing company, if he is to have any management morale at all... we live in a complicated world - a world that has spiritual and moral problems even greater than its economic and technical problems. If the kind of business system we now have is to survive, it must be staffed by men who can deal with problems of both kinds.'³¹

It is below the top levels, it is where the management hierarchies are specialized and varied by industrial line and administrative contour, that the more 'bureaucratic' types of executives and technicians live their corporate lives. And it is below the top levels, in the domain of the Number Two men, that responsibility is lodged. The Number One stratum is often too high to be blamed and has too many others below it to take the blame. Besides, if it is the top, who is in a position to fix the blame upon its members?

It is something like the 'line' and 'staff' division invented by the army. The top is staff; the Number Two is line, and thus operational. Every bright army officer knows that to make decisions without responsibility, you get on the staff.³²

On the middle levels, specialization is required. But the operating specialist will not rise; only the 'broadened' man will rise. What does that mean? It means, for one thing, that the specialist is below the level on which men are wholly alerted to profit. The 'broadened' man is the man who, no matter what he may be doing, is able clearly to see the way to maximize the profit for the corporation as a whole, in the long as well as in the short run.  

 

The man who rises to the top is the broadened man whose 'specialty' coincides with the aims of the corporation, which is the maximizing of profit. As he is judged to have realized this aim, he rises within the corporate world. Financial expediency is the chief element of corporate decision, and generally, the higher the executive, the more he devotes his attention to the financial aspect of the going concern.³³

Moreover, the closer to the corporate top the executive gets, the more important are the big-propertied cliques and political influence in the making of his corporate career.

 

This fact, as well as the considerations for co-optation that prevail, is nicely revealed in a letter that Mr. Lammot du Pont wrote in 1945 in response to a suggestion from a General Motors executive that General George C. Marshall be appointed to the board of directors.

 

Mr. du Pont discussed the proposal:

'My reasons for not favoring his membership on the board are: First his age [The General was then 65]; second, his lack of stockholdings, and third, his lack of experience in industrial business affairs.'

Mr. Alfred P. Sloan, chairman of General Motors, in considering the matter, generally concurred, but added:

'I thought General Marshall might do us some good, when he retires, following his present assignment - assuming he continues to live in Washington; recognizing the position he holds in the community and among the government people and the acquaintances he has - and he became familiar with our thinking and what we are trying to do, it might offset the general negative attitude toward big business, of which we are a symbol and a profitable business, as well. It seems to me that might be some reason, and in that event the matter of age would not be particularly consequential.'

In considering other appointments, Mr. Sloan wrote to W. S. Carpenter, a large owner of du Pont and General Motors:

'George Whitney [G. M. director and chairman of J. P. Morgan & Co.] belongs to the board of directors of quite a number of industrial organizations. He gets around a lot because he lives in New York where many contacts are easily and continuously made. Mr. Douglas [Lewis W. Douglas, a G. M. board member, chairman of the Mutual Life Insurance Company, former Ambassador to Great Britain] is, in a way, quite a public character. He seems to spend a great deal of time in other things. It seems to me that such people do bring into our councils a broader atmosphere than is contributed by the "du Pont directors" and the General Motors directors.'³⁴

Or examine a late case of corporate machination that involved the several types of economic men prevailing in higher corporate circles.

 

Robert R. Young - financial promoter and speculator - recently decided to displace William White, chief executive of the New York Central Railroad and a lifetime career executive in railroad operation. *

 

 

* Over a luncheon table Young offered White the tide of 'chief operating officer' and stock options - 'an opportunity to buy Central stock at a fixed price and without any obligation to pay for it unless it went up.' White refused, announcing that if Young moved in he would give up his contract: $120,000-per-year salary until retirement at 65; a $75,000a-year consultant fee for the next five years; then a $40,000-a-year pension for life.

Immediately White hired, out of Central's funds, a public relations firm at $50,000 a year plus expenses, turned over the $125 million advertising budget of the Central to the coming fight, and engaged a professional proxy solicitor from Wall Street. From Palm Beach, Young began maneuvering cliques among the rich and among friends with contacts to get control of blocks of the property. His side came to include three important members of the very rich - Allen P. Kirby of the Woolworth fortune; and two men each worth over $300 million: Clint Murchison, with whom Young had previously done business, and Sid Richardson, whose ranch Young had visited. The deal shaped up in such a way that a block of 800,000 shares at $26 a share ($20.8 million worth) was secured. Of course, the multimillionaires did not have to put up the cash: They borrowed it - mainly from the Allegheny Corporation, which Young is presumably able to treat as his personal property and .07 per cent of which he personally owns. And they borrowed it in such a way as to cover all risk except 200,000 shares. They were on the scheduled new board of directors. Young had 800,000 voting shares.

Chase National Bank, a Rockefeller bank, had had the trusteeship of these shares and now had sold them to Murchison and Richardson. John J. McCloy, the Bank's board chairman, arranged for White to meet Richardson and Murchison, who flew up the next day to New York City. The Texans, who now owned 12 1/2 per cent of the New York Central, attempted to arrange a compromise. They failed, and a fight for the votes of the more scattered owners began.35

Young's side spent $305,000. (Later the New York Central repaid it, thus footing the bills of both the winners and the losers.) One hundred solicitors for White from coast to coast were reaching stockholders, as well as several hundred volunteer employees of the railroad. Young also engaged a professional proxy solicitation firm; he also had the services of Diebold, Inc., a firm manufacturing office furniture which Murchison owned - 250 of its salesmen were hired to solicit proxies. If Young won, the office furniture for New York Central might henceforth be made by Diebold.36

 

 

Young won - but did it really matter?

 

Success in the corporate world does not follow the pattern it follows in the novel, Executive Suite, in which the technologically inclined young man, just like William Holden, wins by making a sincere speech about corporate responsibility.

 

Besides the favors of two friends, each a leading member of the very rich, Mr. Young's income, over the past seventeen years - most of it from capital gains  - is reported to be well in excess of $10 million.

 

His yearly income is well over a million, his wife's, half a million - and they manage to keep, after taxes, some 75 per cent of it.37 But then, no fiction known to us begins to grasp the realities of the corporate world today.

 

5 - When successful executives think back upon their own careers, they very often emphasize what they always call 'an element of luck.'

 

Now what is that? We are told that Mr. George Humphrey makes it a point to have 'lucky men work with him.' What this means, translated out of the magical language of luck, is that there is an accumulation of corporate success. If you are successful, that shows that you are lucky, and if you are lucky, you are chosen by those up the line, and thus you get chances to be more successful. Time and time again, in close-ups of the executive career, we observe how men in the same circles choose one another. For example, Mr. Humphrey was on an advisory committee to the Commerce Department.

 

There he meets Mr. Paul Hoffman. Later, when Mr. Hoffman heads ECA, he pulls in Mr. Humphrey to run an advisory committee on German industry. There General Clay notices him. General Clay naturally knows General Eisenhower, so when General Eisenhower goes up, General Clay recommends Mr. Humphrey to his close friend, President Eisenhower.³⁸

There is another item that ties in with the network of friends which people call 'luck': the social life of the corporation. It is a reasonable assumption that part of the executive career is spent 'politicking.' Like any politician, especially when he is at or near the top of his hierarchy, the successful executive tries to win friends and to make alliances, and he spends, one suspects, a good deal of time guessing about the cliques he thinks oppose him. He makes power-plays, and these seem part of the career of the managerial elite.

To make the corporation self-perpetuating, the chief executives feel that they must perpetuate themselves, or men like themselves  - future men not only trained but also indoctrinated.

 

This is what is meant when it was truly said recently of a man high in the world's largest oil company that he,

'is really as much a product of the company as are the two million barrels of oil products it makes every day.'

As future executives move upward and toward the center, they become members of a set of cliques, which they often confusedly refer to as a team. They must listen. They must weigh opinions.

 

They must not make snap judgments. They must fit into the business team and the social clique. In so far as the career is truly corporate, one advances by serving the corporation, which means by serving those who are in charge of it and who judge what its interests are.³⁹

The executive career is almost entirely a career within the corporate world, less than one out of ten of the top men over the last three generations having entered top position from independent professional or from outside hierarchies. Moreover, it is increasingly a career within one company: back in 1870, more than six out of ten executives gained the top rung from outside the corporation; by 1950, almost seven out of ten did so from within the company.40 First you are a vice-president, then you are president

You must be known well, you must be well liked, you must be an insider.

Success in the higher corporate world is obviously determined by the standards of selection that prevail and the personal application of these standards by the men who are already at the top. In the corporate world, one is drawn upward by the appraisals of one's superiors. Most chief executives take much pride in their ability 'to judge men'; but what are the standards by which they judge?

 

The standards that prevail are not clear-cut and objective; they seem quite intangible, they are often quite subjective, and they are often perceived by those below as ambiguous. The professors of 'business psychology' have been busy inventing more opaque terms, and searching for 'executive traits,' but most of this 'research' is irrelevant nonsense, as can readily be seen by examining the criteria that prevail, the personal and social characteristics of the successes, and their corporate style of life.

On the lower and middle levels of management, objective criteria having to do with skillful performance of occupational duties do often prevail. It is even possible to set up rules of advancement and to make them known in a regular bureaucratic manner. Under such conditions, skill and energy do often pay off without what one may call the corporate character having to be developed.

 

But once a man of the lower ranks becomes a candidate for higher corporate position, the sound judgment, the broadened view, and other less tangible traits of the corporate character are required. 'Character,' Fortune magazine observers have remarked, even how the man looks as an executive, became more important than technical ability.⁴¹

One often hears that practical experience is what counts, but this is very short-sighted, for those on top control the chances to have practical experience of the sort that would be counted for the higher tasks of sound judgment and careful maneuver. This fact is often hidden by reference to an abstract, transferable quality called 'managerial ability,' but many of those who have been up close to the higher circles (but not of them) have been led to suspect that there probably is no such thing.

 

Moreover, even if there were such a generalized ability, only the uninformed would think that it was what was needed in high policy office, or that one should go to the trouble of recruiting $200,000-a-year men for such work. For that you hire a $20,000-a-year man, or better still, you employ a management counseling firm, which is what the $200,000-a-year men do.

 

Part of their 'managerial ability' consists precisely in knowing their own inabilities and where to find someone with the requisite ability and the money to pay for it. In the meantime, the most accurate single definition of ability - a many-sided word - is: usefulness to those above, to those in control of one's advancement.

When one reads the speeches and reports of executives about the type of man that is required, one cannot avoid this simple conclusion : he must 'fit in' with those already at the top. This means that he must meet the expectations of his superiors and peers; that in personal manner and political view, in social ways and business style, he must be like those who are already in, and upon whose judgments his own success rests.

 

If it is to count in the corporate career, talent, no matter how defined, must be discovered by one's talented superiors. It is in the nature of the morality of corporate accomplishment that those at the top do not and cannot admire that which they do not and cannot understand.

When it is asked of the top corporate men: 'But didn't they have to have something to get up there?' The answer is, 'Yes, they did.' By definition, they had 'what it takes.'

 

The real question accordingly is: what does it take? And the only answer one can find anywhere is: the sound judgment, as gauged by the men of sound judgment who select them. The fit survive, and fitness means, not formal competence - there probably is no such thing for top executive positions - but conformity with the criteria of those who have already succeeded.

 

To be compatible with the top men is to act like them, to look like them, to think like them: to be of and for them - or at least to display oneself to them in such a way as to create that impression. This, in fact, is what is meant by 'creating' -  a well-chosen word - 'a good impression.' This is what is meant -  and nothing else - by being a 'sound man,' as sound as a dollar.

Since success depends upon personal or a clique choice, its criteria tend to be ambiguous. Accordingly, those on the lower edge of the top stratum have ample motive and opportunity to study carefully those above them as models, and to observe critically and with no little anxiety those who are still their peers. Now they are above the approval of technical ability and formal competence, business experience and ordinary middle-class respectability. That is assumed.

 

Now they are in the intangible, ambiguous world of the higher and inner circles, with whose members they must come into a special relation of mutual confidence. Not bureaucratic rules of seniority or objective examinations, but the confidence of the inner circle that one is of them and for them, is a prerequisite for joining them.⁴²

Of the many that are called to the corporate management, only a few are chosen. Those chosen are picked, not so much for strictly personal characteristics - which many of them cannot really be said to possess - as for qualities judged useful to 'the team.' On this team, the prideful grace of individuality is not at a premium.

Those who have started from on high have from their beginnings been formed by sound men and trained for soundness. They do not have to think of having to appear as sound men. They just are sound men; indeed, they embody the standards of soundness. Those who have had low beginnings must think all the harder before taking a risk of being thought unsound.

 

As they succeed, they must train themselves for success; and, as they are formed by it, they too come to embody it, perhaps more rotundly than those of the always-high career. Thus, high or low origin, each in its own way, operates to select and to form the sound men with well-balanced judgment.

It is the criteria of selection, it is the power to conform with and to use these criteria that are important in understanding the chief executives - not merely the statistics of origin. It is the structure of the corporate career and its inner psychological results that form the men at the top, not merely the external sequence of their career.

So speak in the rich, round voice and do not confuse your superiors with details. Know where to draw the line. Execute the ceremony of forming a judgment. Delay recognizing the choice you have already made, so as to make the truism sound like the deeply pondered notion. Speak like the quiet competent man of affairs and never personally say No. Hire the No-man as well as the Yes-man.

 

Be the tolerant Maybe-man and they will cluster around you, filled with hopefulness. Practice softening the facts into the optimistic, practical, forward-looking, cordial, brisk view. Speak to the well-blunted point. Have weight; be stable: caricature what you are supposed to be but never become aware of it much less amused by it.

 

And never let your brains show.
 

 

6 - The criteria for executive advancement that prevail are revealingly displayed in the great corporations' recruitment and training programs, which reflect rather clearly the criteria and judgments prevailing among those who have already succeeded.

 

Among today's chief executives there is much worry about tomorrow's executive elite, and there are many attempts to take inventory of the younger men of the corporation who might develop in ten years or so; to hire psychologists to measure talent and potential talent; for companies to band together and set up classes for their younger executives, and indeed to employ leading universities which arrange distinct schools and curricula for the managers of tomorrow; in short, to make the selection of a managerial elite a staff function of the big company.

Perhaps half of the large corporations now have such programs.⁴³

 

They send selected men to selected colleges and business schools for special courses, Harvard Business School being a favorite. They set up their own schools and courses, often including their own top executives as lecturers. They scout leading colleges for promising graduates, and arrange tours of rotating duty for men selected as potential 'comers.' Some corporations, in fact, at times seem less like businesses than vast schools for future executives.

By such devices, the fraternity of the chosen have attempted to meet the need for executives brought about by the corporate expansion of the 'forties and 'fifties. This expansion occurred after the scarce job market of the 'thirties, when companies could pick and choose executives from among the experienced.

 

During the war there was no time for such programs, which, on top of the slump, made for a decade-and-a-half gap in executive supply. Behind the deliberate recruiting and training programs there is also the uneasy feeling among the top cliques that the second-level executives are not as broad-gauge as they themselves: their programs are designed to meet the felt need for perpetuation of the corporate hierarchy.

So the corporations conduct their raids among the college seniors, like college fraternities among the freshmen. The colleges, in turn, have more and more provided courses thought to be helpful to the corporate career. It is reliably reported that the college boys are 'ready to be what the corporation wants them to be... They are looking hard for cues.'⁴⁴

 

Such 'alertness and receptivity may well be a more important characteristic of the modem manager than the type of education he received. Luck obviously plays a part in the rise of any top executives, and they seem to manage to meet luck better than halfway.'⁴⁵

The cues are readily available: As corporation trainees, the future executives are detached from a central pool and slated for permanent jobs,

'only after they have been given a strong indoctrination in what is sometimes called the "management view." The indoctrination may last as long as two years and occasionally as long as seven.'

Each year, for example, General Electric takes unto itself over 1,000 college graduates and exposes them for at least 45 months, usually much longer, to a faculty of 250 full-time General Electric employees.

 

Many people are watching them, even their peers contribute to the judging, for which, it is said, the trainee is grateful, for thus he will not be overlooked. Training in 'Human Relations' pervades the broad-gauge program.

 

'Never say anything controversial,' 'You can always get anybody to do what you wish,' are themes of the 'effective presentation' course worked up by the Sales Training Department of the knowledgeable corporation.

In this human-relations type of training, the effort is to get people to feel differently as well as to think differently about their human problems. The sensibilities and loyalties and character, not merely the skills, of the trainee must be developed in such a way as to transform the American boy into the American executive.

 

His very success will be an insulation of mind against the ordinary problems and values of non-corporate people. Like all well-designed indoctrination courses, the social life of the trainee is built into the program: to get ahead one must get along, with one's peers and with one's superiors.

 

All belong to the same fraternity; all of one's 'social needs can be filled within the company orbit.' To find his executive slot in this orbit, the trainee must 'take advantage of the many contacts that rotation from place to place affords.' This too is company policy: If you're smart,' says one smart trainee, 'as soon as you know your way around you start telephoning.'⁴⁶

There are many arguments pro and con about training programs for executives, but the Crown-Prince type of program is a central argument among the top executives of big corporations. Nine out of ten young men, even today, do not graduate from college - they are excluded from such executive training schools, although most of them will work for corporations.

 

What effects do such programs have among those who have been called to the corporation but are not among those chosen as Crown Princes? Yet there must be some way to inflate the self-images of the future executives in order that they may take up the reins with the proper mood and in the proper manner and with the sound judgment required.

The majority view of one small but significant sample of executives is that the man who knows 'the technique of managing, not the content of what is managed,' the man who knows 'how to elicit participative consultation... how to conduct problem-solving meetings...' will be the top executive of the future.*

 

 

* Of 98 top executives and personnel planners recently asked to choose between the executive 'primarily concerned with human relations' and 'the man with strong personal convictions... not shy about making unorthodox decisions,' some 63 were willing to make the choice: 40 said the human relations man, 23 the man of conviction.47

 

 

He will be a team player without unorthodox ideas, with leadership rather than drive. Or, as Fortune summarizes the argument:

'Their point goes something like this: We do need new ideas, a questioning of accepted ways. But the leader hires people to do this for him. For this reason, then, the creative qualities once associated with the line are now qualities best put in staff slots. The top executive's job, to paraphrase, is not to look ahead himself, but to check the excesses of the people who do look ahead. He is not part of the basic creative engine; he is the governor.'

Or, as one executive put it: 'We used to look primarily for brilliance...

 

Now that much abused word "character" has become very important. We don't care if you're a Phi Beta Kappa or a Tau Beta Phi. We want a well-rounded person who can handle well-rounded people.'48 Such a man does not invent ideas himself; he is a broker for well-rounded ideas: the decisions are made by the well-rounded group.

Lest all this be thought merely a whimsical fad, not truly reflecting the ideological desert and anxiety of the executive world, consider sympathetically the style of conduct and the ideology of Owen D. Young - late president of General Electric - who serves well as the American prototype of modem man as executive.

 

In the early twentieth century, we are told by Miss Ida Tarbell, the typical industrial leader was a domineering individual, offensive in his belief that business was essentially a private endeavor.

 

But not Owen Young. During World War I and the 'twenties, he changed all that. To him, the corporation was a public institution, and its leaders, although not of course elected by the public, were responsible trustees.

'A big business in Owen D. Young's mind is not... a private business... it is an institution.'

So he worked with people outside his own company, worked on an industry-wide basis, and laughed at 'the fear that co-operation of any kind might be construed as conspiracy.' In fact, he came to feel trade associations, in the corporate age, performed one role that once 'the church,' in a time of small businesses in a local county, performed: the role of moral restrainer, the keeper of 'proper business practices.'

 

During the war, he became a kind of 'general liaison officer between the company and various [government] boards, a kind of general counsel,' a prototype of the many executives whose co-operation with one another during the wars set the shape of peacetime co-operation as well.

His interest in the properties he managed could not have been more personal had he owned them himself. Of one company he helped develop, he wrote to a friend:

'We have worked and played with it together so much that I feel sure it is not boasting to say that no one knows the strength and weakness - the good and bad side of this property better than you and I. In fact I doubt if there were ever such a great property which was known so well...'

His face was always 'friendly and approachable' and his smile, one colleague said,

'his smile alone is worth a million dollars.'

Of his decision, it was said,

'it was not logical document ... It was something his colleagues felt was intuitive rather than reasoned  - a conclusion born of his pondering, and though you might by rule and figures prove him wrong, you knew he was right!'⁴⁹

Back to Contents

 

 

 

 

7 - The Corporate Rich

SIXTY glittering, clannish families do not run the American economy, nor has there occurred any silent revolution of managers who have expropriated the powers and privileges of such families.

 

The truth that is in both these characterizations is less adequately expressed as 'America's Sixty Families' or 'The Managerial Revolution,' than as the managerial reorganization of the propertied classes into the more or less unified stratum of the corporate rich.¹

As families and as individuals, the very rich are still very much a part of the higher economic life of America; so are the chief executives of the major corporations. What has happened, I believe, is the reorganization of the propertied class, along with those of higher salary, into a new corporate world of privilege and prerogative.

 

What is significant about this managerial reorganization of the propertied class is that by means of it the narrow industrial and profit interests of specific firms and industries and families have been translated into the broader economic and political interests of a more genuinely class type. Now the corporate seats of the rich contain all the powers and privileges inherent in the institutions of private property.

The recent social history of American capitalism does not reveal any distinct break in the continuity of the higher capitalist class. There are, to be sure, accessions in each generation, and there is an unknown turnover rate; the proportions of given types of men differ from one epoch to the next. But over the last half a century, in the economy as in the political order, there has been a remarkable continuity of interests, vested in the types of higher economic men who guard and advance them.

 

The main drift of the upper classes, composed of several consistent trends, points unambiguously to the continuation of a world that is quite congenial to the continuation of the corporate rich. For in this stratum are now anchored the ultimate powers of big property whether they rest legally upon ownership or upon managerial control.

The old-fashioned rich were simply the propertied classes, organized on a family basis and seated in a locality, usually a big city.

 

The corporate rich, in addition to such people, include those whose high 'incomes' include the privileges and prerogatives that have come to be features of high executive position. The corporate rich thus includes members of the big-city rich of the metropolitan 400, of the national rich who possess the great American fortunes, as well as chief executives of the major corporations.

 

The propertied class, in the age of corporate property, has become a corporate rich, and in becoming corporate has consolidated its power and drawn to its defense new men of more executive and more political stance. Its members have become self-conscious in terms of the corporate world they represent. As men of status they have secured their privileges and prerogatives in the most stable private institutions of American society.

 

They are a corporate rich because they depend directly, as well as indirectly, for their money, their privileges, their securities, their advantages, then-powers on the world of the big corporations. All the old-fashioned rich are now more or less of the corporate rich, and the newer types of privileged men are there with them.

 

In fact, no one can become rich or stay rich in America today without becoming involved, in one way or another, in the world of the corporate rich.
 

1 - During the 'forties and 'fifties, the national shape of the income distribution became less a pyramid with a flat base than a fat diamond with a bulging middle.

 

Taking into account price changes and tax increases, proportionately more families in 1929 than in 1951 (from 65 to 46 per cent) received family incomes of less than $3,000; fewer then than now received between $3,000 and $7,500 (from 29 to 47 per cent); but about the same proportions (6 and 7 per cent) in both 1929 and 1951 received $7,500 or more.*²
 

* This shift - which of course is even more decisive as between say 1936 and 1951 - is generally due to several economic facts:³

(1) There has been rather full employment - which during the war and its aftermath brought virtually all who wanted to work into the income-receiving classes.

(2) There has been a great doubling up of income within families. In 1951, less than 16 per cent of the families at each of the two extremes, under $2,000 and over $15,000, consisted of families in which the wife also worked; but in the income range of $3,000 to $9,999, the proportion of working wives increased progressively with family income from 16 to 38 per cent.⁴

(3) During the 'twenties and 'thirties, large proportions of the very poor were farmers, but now fewer people are farmers and for those on the farm a prosperity has been backed up by various kinds of government subsidy.

(4) Union pressure - which since the late 'thirties has forced a constant increase in wages.

(5) Welfare programs of the government coming out of the 'thirties have put a floor under incomes - by wage minimums, social security for aged, and pensions for the unemployed and disabled veterans.

(6) Underneath the whole prosperity of the 'forties and 'fifties, of course, is the structural fact of the war economy.
 

Many economic forces at work during the war, and the war-preparations boom that has followed it, have made some people on the very bottom levels rise into what used to be the middle-range income levels, and some of those who used to be in the middle-range of income levels became upper-middle or upper.

 

The changed distribution of real income has thus affected the middle and lower levels of the population, with which, of course, we are not here directly concerned. Our interest is in the higher levels; and the forces at work on the income structure have not changed the decisive facts of the big money.

At the very top of the mid-century American economy, there are some 120 people who each year receive a million dollars or more. Just below them, another 379 people appropriate between a half a million and a million. Some 1,383 people get from $250,000 to $499,999. And below all these, there is the broader base of 11,490 people who receive from $100,000 to $249,999.

Altogether, then, in 1949, there were 13,822 people who declared incomes of $100,000 or more to the tax collector.5 Let us draw the line of the openly declared corporate rich at that level: $100,000 a year and up. It is not an entirely arbitrary figure.

 

For there is one fact about the fat diamond that remains true regardless of how many people are on each of its levels: on the middle and higher levels especially, the greater the yearly income, the greater the proportion of it from property, and the smaller the proportion from salaries, entrepreneurial withdrawal, or wages. The rich of the higher incomes, in short, are still of the propertied class.

 

The lower incomes derive from wages.*

 

 

* Some 86 per cent of the money received by people paying taxes on less than $10,000 in 1949 came from salaries and wages; 9 per cent, from business or partnership profits; only 5 per cent from property owned.

As a proportion of money received, entrepreneurial withdrawals bulk largest among those receiving from $10,000 to $99,999 per year -  34 per cent of the income gotten by people on this income level is business profits; 41 per cent, salaries and wages; and 23 per cent from property. (Two per cent is 'miscellaneous income,' annuities or pensions.)

One hundred thousand dollars a year is the income level on which property enters the income picture in a major way: two-thirds (67 per cent) of the money received by the 13,702 people in the declared $100,000 and up to $999,999 bracket comes from property - from dividends, capital gains, estates, and trusts. The remaining one-third is split between chief executives and top entrepreneurs.

The higher you go into these upper reaches, the more does property count, and the less does income for services performed. Thus 94 per cent of the money of the 120 people receiving a million dollars or more in 1949 came from property, 5 per cent from entrepreneurial profits, 1 per cent from salaries. Among these 120 people, there was considerable variation in the type of property from which their money came.⁶

 

But, regardless of the legal arrangements involved, those with big incomes receive it overwhelmingly from corporate property. That is the first reason that all the rich are now corporate rich, and that is the key economic difference between the rich and the more than 99 per cent of the population who are well below the $100,000 income level.

In these tax-declared high-income classes, people come and go; every year the exact number of people varies. In 1929, when taxes were not so high as to make it so dangerous as now to declare high incomes, there were about 1,000 more such declarations than in 1949 - a total of 14,816 declared incomes of $100,000 or more. In 1948 there were 16,280; in 1939 only 2.921.7 But on the highest levels there remains throughout the years a hard core of the very wealthy.

 

Four-fifths of the 75 people who appropriated one million dollars or more in 1924, for example, got one million or more in at least one other year between 1917 and 1936. The chances are good that those who make it in one year will make it in another year or two.*

 

 

* Such figures are, of course, only crude indications of the meaning of the big money, as they dp not take into account the element of inflation. The number of corporate rich for any given year, as well as the number of million-dollar incomes, is related to the tax rate and to the profit level of the corporate world. Periods of low taxes and high profits are periods in which the declared million-dollar incomes flourish: in the ideal year of 1929, 513 people, estates, or trusts, told the government they had received incomes of one million or more. The average of these million-dollar incomes was $2.36 million, and after taxes the average million-dollar man had 1.99 million left. In the slump year of 1932, there were still 20 people who reported incomes of one million or more; by 1939, when three-fourths of all the families in the United States had incomes of less than $2,000 a year, there were 45 such million-dollar incomes reported. With the war, however, the number of million-dollar incomes increased as did the general level of income. In 1949 when both profits and taxes were high, the average income of the 120 people who told the government they had received one million or more was 2.13 million; after taxes they were left with $910,000. In 1919, however, when taxes and profits were high although profits were falling a bit, only 65 people earned one million or more, averaging 2.3 million before taxes, but only $825,000 after taxes.⁸

 

 

Farther down the pyramid, only 3 or 4 per cent of the population during the decade after World War II have held as much as $10,000 in liquid assets.⁹
 

 

2 - Since virtually all statistics of income are based on declarations to tax collectors, they do not fully reveal the 'income' differences between the corporate rich and other Americans. In fact, one major difference has to do with privileges that are deliberately created for the exclusion of 'income' from tax records.

 

These privileges are so pervasive that we find it hard to take seriously the great publicity given to the 'income revolution,' which is said to have taken place over the last twenty years. A change, as we have just reported, has taken place in the total income distribution of the United States; but we do not find it very convincing to judge from declared income tax records that the share the rich receive of all the wealth in the country has decreased.¹⁰

Tax rates being high, the corporate rich are quite nimble in figuring out ways to get income, or the things and experiences that income provides, in such a way as to escape taxation. The manner in which the corporate rich pay their taxes is more flexible and provides more opportunities for shrewd interpretations of the law than is true for the middle and lower classes. People of higher income figure their own tax deductions, or more usually have them figured by the experts they hire.

 

Perhaps those whose income derives from property or from entrepreneurial and professional practice are as honest - or as dishonest - as poorer people on wages and salary, but they are also economically bolder, they have greater opportunities and greater skill, and, even more importantly, they have access to the very best skills available for such matters: accomplished lawyers and skillful accountants who specialize in taxation as a science and a game.

 

In the nature of the case, it would be impossible to prove with exactitude, but it is difficult not to believe that as a general rule the higher the income and the more varied its sources, the greater the likelihood of the shrewd tax return. Much declared money is tricked, legally and illegally, from the tax collector; much illegal money is simply not declared.

Perhaps the most important tax loophole in retaining current income is the long-term capital gain. When a military man writes a best-seller or has it written for him, when a businessman sells his farm or a dozen pigs, when an executive sells his stock - the profit received is not considered as income but as capital gain, which means that the profit to the individual after taxes is approximately twice what it would have been if that same amount of money had been received as a salary or a dividend. Individuals claiming long-term capital gains pay taxes on only 50 per cent of that gain.

 

The half that is taxed is taxed at a progressive rate applicable to a person's total income; but the maximum tax on such gains is 52 per cent.

 

This means that at no time can the tax paid on these capital gains be more than 26 per cent of the total gain received; and it will be smaller if the total income, including the gain, leaves the individual in a lower income tax bracket. But when the flow of money is turned around the other way, a capital loss of over $1,000 (those under $1,000 may be deducted from ordinary income) can be spread backward or forward in a five-year span to offset capital gains.

 

Aside from capital gains, the most profitable tax loophole is perhaps the 'depletion allowance' on oil and gas wells and mineral deposits.

 

From 5 to 27/2 per cent of the gross income received on an oil well, but not exceeding 50 per cent of the net income from the property, is tax-free each year. Moreover, all the costs of drilling and developing an oil well can be deducted as they occur-instead of being capitalized and depreciated over the years of the well's productive life.¹¹

 

The important point of privilege has less to do with the percentage allowed than with the continuation of the device long after the property is fully depreciated.

Those with enough money to play around may also off-set taxes by placing money in tax-free municipal bonds; they may split their income among various family members so that the taxes paid are at a lower rate than the combined income would have required.

 

The rich cannot give away to friends or relatives more than a lifetime total of $30,000 plus $3,000 each year without paying a gift tax; although, in the name of both husband and wife, a couple can give twice that amount. The rich man can also make a tax-deductible gift (up to 20 per cent of yearly income that is given to recognized charities is not taxed as income) that will provide him security for the rest of his life.

 

He can donate to a named charity the principal of a fund, but continue to receive the income from it.*

 

 

* For example, a man can give $10,000 worth of stock to a theological seminary, which - because of tax savings - actually costs him only $4,268.49. In ten years, let us assume, the stock increases in market value to $16,369.49, and the man receives $6,629 in income payments which is 50 per cent more than the cost of his gift. When the man dies, of course, the seminary will own the stock and receive its earnings.¹²

 

 

He thus makes an immediate deduction on his income tax return; and he cuts that part of his estate that is subject to inheritance taxes.¹³

There are other techniques that help the rich preserve their money after they are dead in spite of high estate taxes. For example, it is possible to set up a trust for a grandchild, and stipulate that the child receive the income from the trust as long as he is alive, although the property legally belongs to the grandchild. It is only at the death of the child (instead of both the original owner and the child) that an estate tax is paid.

A family trust saves taxes - both current income tax and estate tax levied upon death - for income of the trust fund is taxed separately.

 

In addition, the trust provides the property holder with continuous professional management, eliminates the worries of responsibility, keeps the property intact in one manageable sum, builds the strongest possible legal safeguards to property, and, in effect, enables the owner to continue to control his property after he is dead.*

 

 

* 'Take the case of a married man,' a magazine for executives carefully explains, 'who has a taxable income of $30,000, including a $1,000 return on a $25,000 investment. After taxes, that $1,000 of income is worth only $450. Accumulating it each year for 10 years at compound interest of 4 per cent would produce, at the most, a fund of about $5,650 for his family. But suppose the man transfers the $25,000 investment to a short-term trust. If the arrangement meets certain requirements, the trust will pay a tax of about $200 on each $1,000 of income, leaving $800. In 10 years, that could build up to about $9,600-a gain of 70 per cent over what could have been accumulated without a trust... [This is not allowed in all states.] At the termination of the trust, the man would get back his $25,000, plus unrealized appreciation. The accumulated income would go to the trust beneficiary, someone within his family in a light tax status.'¹⁴
 

There are many kinds of trusts, and the law is rather complicated and strict in their application; but in one type of short-term trust,

'what you do is Indian-give ownership of property to a trustee - and actually give away its income - for some set period (of more than 10 years). Then if the trust meets all other requirements, you're clear of tax on that income.'¹⁵

Twenty-five years ago, there were no more than 250 foundations in the entire United States; today there are thousands.

 

Generally, a foundation is defined as,

'any autonomous, non-profit legal entity that is set up to "serve the welfare of mankind." It administers wealth that is transferred to it through tax-free gifts or bequests.'

Actually, the setting up of foundations has often become a convenient way of avoiding taxes,

operating as private banks for their donors; not infrequently, the "mankind" they have served turned out to be a few indigent relatives.'

The Revenue Act of 1950 tried,

'to plug up some of the bigger loopholes' but 'dubious foundations still have an advantage - the tax collector has a hard time getting information about them... revenue men complain they haven't time or manpower to check more than a tiny fraction of the reports already filed by foundations. They have to steer largely by instinct in deciding which ones to investigate,' and even the 1950 law does not require that all pertinent data concerning them be furnished to the government.

In recent years, more businesses have been creating foundations, thus making a bid for local and national good will, while encouraging research in their own industries.

 

The corporation so engaged does not have to pay taxes on the 5 per cent of its profits that it yearly gives to its foundation. Very rich families also can keep control of their business after a death in the family by giving large shares of the company stock to a foundation (Ford is unusual in this respect only in the magnitude of the sums involved).

 

The size of the inheritance tax, which might otherwise force a sale of stock to outsiders in order to pay the taxes, is reduced. 'If a man's chief concern is to raise a tax-free umbrella over part of his income and to give some jobs to needy retainers,' an alert business magazine advises its executive readers, 'he should by all means set up his own foundation, no matter how small. Then he may even prefer to have the overhead eat up all the income.'¹⁶

For virtually every law taxing big money, there is a way those with big money can avoid it or minimize it. But such legal and illegal maneuvers are only part of the income privileges of the corporate rich: working hand-in-hand with the rules and regulations of the government, the corporations find ways directly to supplement the income of the executive rich.

 

These various forms of feathering the nest now make it possible for executive members of the corporate rich to live richly on seemingly moderate incomes, while paying taxes lower than the law seemingly intends as fair and just.

 

Among such privileged arrangements are following:

Under the deferred pay contract, the corporation signs up for a given salary for a number of years, and further agrees to pay an annual retainer after retirement as long as the executive doesn't go to work for any competing firm. The executive's loyalty is thus linked to the company, and he is able to spread his income into the years when lower earnings will result in reduced taxes.

 

One Chrysler executive, for example, recently signed a contract yielding him $300,000 a year for the next five years, then $75,000 a year for the rest of his life. A recently retired Chairman of U. S. Steel's Board, who was receiving a $211,000 salary, now gets $14,000 a year as his pension, plus $55,000 a year in 'deferred pay.'¹⁷

The classic case of deferred payment is perhaps the one worked out for a famous entertainer, who was in a position to demand $500,000 a year for 3 years. Instead, he arranged to take $50,000 a year for the next 30 years. No one seriously expects him to be active in show business when he is approaching 80, but by spreading out his income and keeping it in lower tax brackets he was able to cut the total income tax he will have to pay by nearly $600,000, according to one estimate.'¹⁸

 

Such fabulous arrangements are not limited to the world of show business, even though there they may be more publicized: Even the most respected and staid companies are now in many instances taking care of their key people by such means.

Executives are given restricted options to buy stock at or below current market value. This keeps the executive with the company; for he is able to pick up the option only after a specified period of time such as a year, or he may only be able to use it to buy limited quantities of stock over a longer period of time - say five years.¹⁹

 

To the executive as riskless entrepreneur, at the time he picks up his option, there comes an immediate profit (the difference between the option price previously set and the market value of the stock at the time when he buys it). Most of the profit he makes if he later sells the stock is not considered taxable income by an obliging government: it is taxed at the lower capital gains rate. Nothing prevents him from borrowing money to pick up his option, and then selling the stock in six months at the higher market value.

 

For example, in 1954, the president of an aircraft company was given - in salary, bonus, and pension credits - about $150,000, but after taxes he took home only about $75,000. However, if he wished to sell the 10,000 shares of stock he had bought on his company's option plan several months before, he could, after paying all taxes due, have also taken home $594,375.²⁰

 

About one out of six companies listed on the New York Stock Exchange gave stock options to executives within a year or so after the 1950 tax law made them attractive as capital gains. Since then, the practice has spread.²¹
 

3 - The corporate rich are a propertied rich, but big property is not all that they possess; the corporate rich are able to accumulate and to retain high incomes, but high incomes are not all they accumulate for keeps. In addition to big property and high income, they enjoy the corporate privileges that are part of the newer status system of the incorporated economy of the United States.

 

These status privileges of the corporate rich are now standard practices, essential, even though shifting, features of business-as-usual, part of the going pay-off for success. Criticism of them does not arouse indignation on the part of anyone in a position voluntarily to do anything about them, and much less about the corporate system in which they are firmly anchored.

None of these privileges are revealed by examination of the yearly income or the property holding. They are, one might say, fringe benefits of the higher circles. The 'fringe benefits' which lower salaried and wage earners have been given - primarily private pension and welfare plans, social security and unemployment insurance - have risen from 1.1 per cent of the national payroll in 1929 to 5.9 per cent in 1953.²²

 

It is not possible to calculate with suitable precision the 'fringe benefits' taken by the risk-less entrepreneurs of the big corporations, but it is now certain that they have become quite central to the higher emoluments. It is because of them that the corporate rich may be considered, in a decisive way, to be members of a directly privileged class.

 

The corporations from which their property and incomes derive are also the seats of the privileges and prerogatives. The great variety of these privileges substantially increases their standard of consumption, buttresses their financial position against the ups and downs of the economic system, lends shape to their whole style of living, and lifts them into a security as great as that of the corporate economy itself.

 

Designed to increase the wealth and the security of the rich in a manner that avoids the payment of taxes, they also strengthen their loyalties to the corporations.²³

Among the accoutrements that often go with the big executive job but are never reported to tax collectors are such fringe benefits as these: free medical care, payments of club fees, company lawyers and accountants available for tax, financial and legal advice, facilities for entertaining customers, private recreation areas  - golf courses, swimming pools, gymnasiums - scholarship funds for children of executives, company automobiles, and dining rooms for executive use.²⁴

 

By 1955, some 37 per cent of all the Cadillac registrations in Manhattan, and 20 per cent in Philadelphia, were in company names.²⁵

'A company dedicated to keeping its officers happy,' one reliable observer recently noted, 'can with all propriety have a company airplane for business trips and a yacht and a hunting-fishing lodge in the north woods to entertain its biggest customers.* It can also arrange to hold its conventions in Miami in midwinter. The effect, as far as company executives go, is to provide wonderful travel and vacation facilities without cost.

 

The company officers go south in the winter and north by summer; take along enough work or enough customers to justify the trip, and proceed to have a very pleasant time of it... At home the executives can also ride around in company-owned and chauffeured automobiles. Naturally the company is happy to pay their dues at the best available country club, for the purposes of entertaining customers on the golf course, and at the best town club, for intimate lunches and dinners.' ²⁷

*Businessmen now fly nearly four million hours a year in private planes - more than all scheduled, commercial airlines put together.²⁶

 

 

You name it and you can find it. And it is increasing: it is free to the executive, and deductible as an ordinary business expense by the corporation.

These higher emoluments may also extend to lavish gifts of wonderful toys for adults, like automobiles and fur coats, and conveniences like deep freezes for the purchasing agents and business contacts not directly employed by the company.

 

All this has been widely publicized and decried in the political field,** but, as any business executive of stature well knows, such gifts of business friendship are standard practice within and especially between big firms.


** For example: 'Over the past two years more than 300 Congressmen have taken trips abroad at a cost to the U.S. taxpayer estimated unofficially at over $3,500,000. Many of the junkets were unquestionably useful and legitimate fact-finding tours and inspections. Others unquestionably represented some fancy free-loading. Last week the House of Representatives Rules Committee served notice that the lid was on junkets.


Back in 1910, for example, White Sulphur Springs in the hills of West Virginia was on the same social circuit as Bar Harbor and Newport.

 

In 1954, the Chesapeake and Ohio Railroad, which owns the Greenbrier resort hotel in White Sulphur Springs, invited as guests top level executives who are, in fact or potentially, important shippers and who feel honored to be invited.

 

In 1948, the C & O paid for everything, but the response was so great from the business, social, and political celebrities who accepted the invitation that they now come on their own expense accounts. The resort operates year-round but the Spring Festival is the big social-business event.²⁹

In Florida, there is now being constructed an entire resort town, with an average population of 3,000, which will be rented to executives and their guests on a year-round basis. The companies involved can either sublet it to their employees or write off the cost as a business-expense deduction during the times it is used for entertaining customers, holding conventions or important conferences.

The Continental Motors Corporation operates duck-hunting expeditions at Lost Island, Arkansas. Assuming that the golf, cocktail, dinner, and night club routine is 'old-hat' to any executive by the time he is big enough to be an important customer, Continental set up a 'customer relations program' which has been going some fifteen years.

 

Such 'lodge-type' selling retreats are concentrated in the primary goods industries, where the big sales are made, president to president, rather than in consumer goods. Everyone on the hunt is 'a president or a vice-president, or maybe a general or an admiral.' In the same vicinity, at least three other corporations also operate exclusive duck-hunting clubs. Top employees as well as clients are usually among the guests at such duck, deer, and trout facilities.³¹

'The Committee, which must approve all investigating authority, said it planned to approve free foreign travel only for members of the Foreign Affairs, Armed Services, and Insular Affairs Committees. Around Congress the gag last week,' The New York Times concluded, 'was that it would be tough to muster the usual quorum in Paris this summer.'²⁸
 

More widely wide-ranging and recognized, but far-reaching still fact not of the seriously studied is expense account. the No one knows, and there is no way to find out for sure, just how much of high living and exciting entertainment is made possible for the new privileged classes solely because of the expense account.

 

The vice-president of one firm,' economist Richard A. Girard recently reported,

'is assigned a flat $20,000 each year to cover any entertaining he may decide to do. His contract specifies that he does not have to account for the money.'³²

Tax officials play a continual game with members of the corporate rich over expense-account deductions but generally insist that each case is unique - which means there are no set rules and the revenue agent has wide responsibility.

'Theatre people estimate that thirty to forty per cent of the New York theatre audience is an expense-account audience, and that this is the percentage between life and death.'³³

 

Moreover, 'in cities like New York, Washington and Chicago,' one investigator feels it 'safe to say that at any given moment well over half of all the people in the best hotels, the best nightclubs and the best restaurants are charging the bill as an expense account item to their companies, which in turn are charging it to the government in the form of tax deductions' - and goes on to assert what is well known:

'There is something about an expense account that brings out the latent rascality, rapacity and mendacity in even the otherwise most honorable man. Expense account forms have long been known affectionately by their fond possessors as "swindle sheets."

 

Filling out an expense account itemization has been regarded as a kind of contest of wits with the company auditor, in which it is perfectly justifiable to use the most outrageous half-truths, little white lies and outright fantasies, anything at all which the auditor, regardless of how outraged he might be, cannot absolutely prove to be false.'³⁴

We have by no means reported all of the privileges of the corporate rich, confining ourselves mainly to legally and officially sanctioned types. Many of the new privileges - especially the higher emoluments - have long been known and are quite accepted by heads of state and by higher officials of public office.

 

The governor is given 'the governor's mansion' in which to live rent free; the president, with $50,000 a year tax-free expenses, also has his White House, which contains his serviced living quarters as well as offices of administration.

 

But what has happened, as the corporation has become the anchor point for the privileges that go with great wealth, is that such higher emoluments have become normal among the private rich as they have become transformed into the corporate rich. When, in their happier moods, corporation executives speak lovingly of their corporations as One Big Family, one can understand that in a very real sense they are asserting a sociological truth about the class structure of American society.

 

For the powers and privileges of property, shared among the corporate rich, are now collective, and the individual has such privileges most securely only in so far as he is part of the corporate world.
 

 

4 - America has not become a country where individual pleasures and powers are bounded by small incomes and high taxes.

 

There are incomes high enough to remain high despite the taxes and there are many ways of escaping and minimizing taxes. There is maintained in America, and there is being created and maintained every year, a stratum of the corporate rich, many of whose members possess far more money than they can personally spend with any convenience.

 

For many of them, the prices of things are simply irrelevant. They never have to look at the right hand column of a menu; they never have to take orders from anybody, they never have to do really disagreeable things except as a self-imposed task; they never have to face alternatives hedged in by considerations of cost.

 

They never have to do anything. They are, according to all appearances, free.

But are they really free?

The answer is Yes, within the terms of their society, they are really free. But does not the possession of money somehow limit them? The answer is No, it does not. But are not those just the hurried answers, are there not more considered, deeper-going answers?

What kind of deeper-going answers? And what does freedom mean? Whatever else it may mean, freedom means that you have the power to do what you want to do, when you want to do it, and how you want to do it And in American society the power to do what you want, when you want, how you want, requires money. Money provides power and power provides freedom.

But are there no limits on all this?

Of course there are limits to the power of money, and the freedoms based on that power. And there are also psychological traps for the rich, as among misers and spendthrifts on all levels, which distort their capacity for freedom.

The miser enjoys the possession of money as such. The spendthrift enjoys the spending of money as such. Neither - in the pure type - can look upon money as a means to free and various ends of life, whatever they may be. The miser's pleasure is in the potentiality of his spending power, so he draws back from the actual spending. He is a tense man, afraid of losing the potentiality and so never realizing it.

 

His security and his power are embodied in his hoard, and in fearing to lose it, he fears loss of his very self. He is not merely a stingy man, nor necessarily a merely avaricious man. He is an impotent voyeur of the economic system, one for whom the possession of money for its own sake, and not as a means to any further end, has become the end of life.

 

He cannot complete the economic act. And money, which to most economic men is a means, becomes to the miser a despotic end.

The spendthrift, on the other hand, is a man for whom the act of spending is itself a source of pleasure. He does not feel happy on a spending spree because of his expected ease or pleasure from the goods acquired. The act of senseless spending is in itself his pleasure and reward. And in this act the spendthrift advertises his unconcern with mere money. He consumes conspicuously to show that he is above pecuniary considerations, thus revealing how highly he values them.

No doubt both of these oddities of the money system are available among the American rich today, but they are not typical. For most members of the corporate rich money remains a gratifying medium of exchange - a pure and unadulterated means to an enormous variety of concrete ends. For most of them, money is valued for what it will purchase in comfort and fun, status and alcoholism, security and power and experience, freedom and boredom.

On the bottom level of the money system one never has enough money, which is the key link in the hand-to-mouth way of existence. One is, in a sense, below the money system - never having enough money to be firmly a part of it.

On the middle levels, the money system often seems an endless treadmill. One never gets enough; $8,000 this year seems to place one in no better straits than did $6,000 the last. There are suspicions among people on such levels, that were they to make $15,000, they would still be on the treadmill, trapped in the money system.

But above a certain point in the scale of wealth, there is a qualitative break: the rich come to know that they have so much that they simply do not have to think about money at all: it is only they who have truly won the money game; they are above the struggle. It is not too much to say that in a pecuniary society, only then are men in a position to be free.

 

Acquisition as a form of experience and all that it demands no longer need to be a chain. They can be above the money system, above the scramble on the treadmill: for them it is no longer true that the more they have, the harder it seems to make ends meet. That is the way we define the rich as personal consumers.

For the very poor, the ends of necessity never meet. For the middle classes there are always new ends, if not of necessity, of status. For the very rich, the ends have never been separated, and within the limits of the common human species, they are today as free as any Americans.

The idea that the millionaire finds nothing but a sad, empty place at the top of this society; the idea that the rich do not know what to do with their money; the idea that the successful become filled up with futility, and that those born successful are poor and little as well as rich - the idea, in short, of the disconsolateness of the rich - is, in the main, merely a way by which those who are not rich reconcile themselves to the fact. Wealth in America is directly gratifying and directly leads to many further gratifications.

To be truly rich is to possess the means of realizing in big ways one's little whims and fantasies and sicknesses. 'Wealth has great privileges,' Balzac once remarked, 'and the most enviable of them all is the power of carrying out thoughts and feelings to the uttermost; of quickening sensibility by fulfilling its myriad caprices.'³⁵

 

The rich, like other men, are perhaps more simply human than otherwise. But their toys are bigger; they have more of them; they have more of them all at once.*

 

 

* One of the propositions with which Howard Hughes has been associated was the purchase of RKO from Floyd Odium for almost nine million dollars. 'I needed it like I needed small pox!' When asked to account for this move, Hughes seriously answers, '. . .  the only reason I bought RKO from Floyd Odium was because I enjoyed the many flights down to his ranch in Indio [California] while we discussed the details of the purchase.'⁸⁶ 'He is king...' one of Balzac's characters proclaims, 'he can do what he chooses; he is above everything, as all rich men are.

To him, henceforth, the expression:

"All Frenchmen are equal before the law," is the lie inscribed at the head of a charter. He will not obey the laws, the laws will obey him. There is no scaffold, no headsman, for millionaires!'
'Yes, there is,' replied Raphael, 'they are their own headsmen!'
'Another prejudice,' cried the banker.37
 

As for the happiness of the rich, that is a matter that can be neither proved nor disproved.

 

Still, we must remember that the American rich are the winners within a society in which money and money-values are the supreme stakes. If the rich are not happy it is because none of us are happy. Moreover, to believe that they are unhappy would probably be un-American. For if they are not happy, then the very terms of success in America, the very aspirations of all sound men, lead to ashes rather than fruit.

Even if everyone in America, being human, were miserable, that would be not reason to believe that the rich were more miserable. And if everyone is happy, surely that is no reason to believe that the rich are excluded from the general American bliss. If those who win the game for which the entire society seems designed are not 'happy,' are then those who lose the happy ones?

 

Must we believe that only those who live within, but not of, the American society can be happy? Were it calamitous to lose, and horrible to win, then the game of success would indeed be a sad game, doubly so in that it is a game everyone in and of the American culture cannot avoid playing.

 

For to withdraw is of course objectively to lose, and to lose objectively, although subjectively to believe one has not lost - that borders on insanity. We simply must believe that the American rich are happy, else our confidence in the whole endeavor might be shaken. For of all the possible values of human society, one and one only is truly sovereign, truly universal, truly sound, truly and completely acceptable goal of man in America.

 

That goal is money, and let there be no sour grapes about it from the losers.
 

 

5 - The newer privileges of the corporate rich have to do with the power of money in the sphere of consumption and personal experience.

 

But the power of money, the prerogatives of economic position, the social and political weight of corporate property, is by no means limited to the sphere of accumulation and consumption, corporate or personal. In fact, from the standpoint of the American elite, of which the corporate rich are only one segment, the power over consumer goods is not nearly so important as the institutional powers of wealth.

I. The Constitution is the sovereign political contract of the United States. By its fourteenth amendment it gives due legal sanction to the corporations, now the seat of the corporate rich, managed by the executives among them. Within the political framework of the nation, this corporate elite constitutes a set of governing groups, a hierarchy developed and run from the economic top down.

 

The chief executives are now at the head of the corporate world, which in turn is a world of economic sovereignty within the nation's politically sovereign area. In them is vested the economic initiative, and they know it and they feel it to be their prerogative. As chiefs of the industrial manorialism, they have looked reluctantly to the federal government's social responsibility for the welfare of the underlying population.

 

They view workers and distributors and suppliers of their corporate systems as subordinate members of their world, and they view themselves as individuals of the American individualistic sort who have reached the top.

They run the privately incorporated economy. It cannot be said that the government has interfered much during the last decade, for in virtually every case of regulation that we examine the regulating agency has tended to become a corporate outpost.³⁸

 

To control the productive facilities is to control not only things but the men who, not owning property, are drawn to it in order to work. It is to constrain and to manage their life at work in the factory, on the railroad, in the office. It is to determine the shape of the labor market, or to fight over that shape with union or government. It is to make decisions in the name of the enterprise as to how much to produce of what and when and how to produce it and how much to charge for it.

II. Money allows the economic power of its possessor to be translated directly into political party causes. In the eighteen-nineties, Mark Hanna raised money from among the rich for political use out of the fright caused by William Jennings Bryan and the Populist 'nightmare'; and many of the very rich have been unofficial advisers to politicians. Mellons, Pews, and du Ponts have long been campaign contributors of note, and, in the post-World War II period, the Texas millionaires have contributed sizable amounts of money in campaigns across the nation.

 

They have helped McCarthy in Wisconsin, Jenner in Indiana, Butler and Beall in Maryland. In 1952, for example, one oil tycoon (Hugh Roy Cullen) made thirty-one contributions of from $500 to $5,000 each (totaling at least $53,000), and his two sons-in-law helped out (at least $19,750 more) ten Congressional candidates.

 

It is said that the Texas multimillionaires now use their money in the politics of at least thirty states. Murchison has contributed to political candidates outside Texas since 1938, although he got no publicity until 1950, when he and his wife, at Joseph McCarthy's request, contributed $10,000 to defeat Senator Tydings of Maryland, and in 1952 sent money to beat McCarthy's Connecticut foe, Senator William Benton.³⁹

In 1952, 'the six top Republican and Democratic political committees received 55 per cent of their total receipts [this includes only those receipts of groups that spent money in two or more states] in 2,407 contributions of $1,000 or more.'*
 

* Heading the list of contributions to the Republican party were the Rockefellers ($94,000), the du Ponts ($74,175), the Pews ($65,100), the Mellons($54,000), the Weirs ($21,000), the Whitneys ($19,000), the Vanderbilts ($19,000), the Goelets ($16,800), the Milbanks ($16,500), and Henry R. Luce ($13,000). Heading the list of contributions to the Democratic party were the Wade Thompsons of Nashville ($22,000), the Kennedys ($20,000), Albert M. Greenfield of Philadelphia ($16,000), Matthew H. McCloskey of Pennsylvania ($10,000), and the Marshall Fields ($10,000) .40


Such figures are absolute minimums since many contributions can be made by family members of different names, not easily recognized by the reporters.

III. But it is not so much by direct campaign contributions that the wealthy exert political power. And it is not so much the very rich as the corporate executives - the corporate reorganizes of the big propertied class - who have translated the power of property into political use. As the corporate world has become more intricately involved in the political order, these executives have become intimately associated with the politicians, and especially with the key 'politicians' who form the political directorate of the United States government.

The nineteenth-century economic man, we are accustomed to believe, was a shrewd 'specialist' in bargaining and haggling. But the growth of the great corporation and the increased intervention of government into the economic realm have selected and formed and privileged economic men who are less hagglers and bargainers on any market than professional executives and adroit economic politicians.

 

For today the successful economic man, either as propertied manager or manager of property, must influence or control those positions in the state in which decisions of consequence to his corporate activities are made. This trend in economic men is, of course, facilitated by war, which thus creates the need to continue corporate activities with political as well as the economic means.

 

War is of course the health of the corporate economy; during war the political economy tends to become more unified, and moreover, political legitimizations of the most unquestionable sort - national security itself - are gained for corporate economic activities.

'Before World War I, businessmen fought each other; after the war they combined to present a united front against consumers.'⁴¹

During World War II they served on innumerable advisory committees in the prosecution of the war. They were also brought into the military apparatus more permanently by the awarding to many businessmen of commissions in the reserve officer corps.*

 

 

* A survey of the backgrounds of dollar-a-year men in Washington during World War II shows that what industry loaned the government was, except for a very few men, its financial experts, not men experienced in production:'. . . the salesmen and purchasing agents in WPB are under Ferdinand Eberstadt, former Wall Street investment banker. The alibi that these men have special qualifications for their jobs took a terrific beating when WPB within the past month found it necessary to put... through a special training course to teach them the fundamentals of industrial production... And that brings us to the dollar-a-year men who padded WPB's payrolls with their companies' salesmen and purchasing agents. The dollar-a-year boys were supposed to be industry's loan of its top-management experts and financial experts to the government to help run a winning war. Now top management in industry is made up of two types of men... production experts and financial experts ... Its production experts industry kept for its own business.'42

All this has been going on for a long time and is rather well known, but in the Eisenhower administration the corporate executives publicly assumed the key posts of the executive branch of the government.

 

Where before the more silent power and the ample contract was there, now there was also the loud voice.

Is there need for very subtle analysis of such matters when the Secretary of the Interior, Douglas McKay, blurted out to his friends in the Chamber of Commerce, on 29 April 1953, 'We're here in the saddle as an Administration representing business and industry?'⁴³ Or when Secretary of Defense Wilson asserted the identity of interests between the United States of America and the General Motors Corporation?

 

Such incidents may be political blunders - or would be, were there an opposition party - but are they not as well revelations of deeply held convictions and intentions?

There are executives who are as afraid of such political identification as 'non-partisan' labor leaders are of third parties. For a long time the corporate rich had been in training as an opposition group; the brighter ones then came to feel vaguely that they might be on the spot. Before Eisenhower, such power as they wielded could more easily be politically irresponsible. After Eisenhower that is not so easy. If things go wrong, will not they - and with them business - be blamed?

But John Knox Jessup, chairman of the editorial board of Fortune, feels that the corporation can supplant the archaic system of states as a framework for self-government - and thus fill the vacuum of the middle levels of power. For, as chief of the corporate commonwealth, the manager has the political job of keeping all his constituents reasonably happy.

 

Mr. Jessup argues that the balances of economic and political domains have already broken down:

'Any President who wants to run a prosperous country depends on the corporation at least as much as - probably more than - the corporation depends on him. His dependence is not unlike that of King John on the landed barons of Runnymede, where Magna Carta was born.'⁴⁴

In general, however, the ideology of the executives, as members of the corporate rich, is conservatism without any ideology.

 

They are conservative, if for no other reason than that they feel themselves to be a sort of fraternity of the successful. They are without ideology because they feel themselves to be 'practical' men. They do not think up problems; they respond to alternatives presented to them, and such ideology as they have must be inferred from such responses as they make.

During the last three decades, since the First World War in fact, the distinction between the political and the economic man has been diminishing; although the corporation managers have, in the past, distrusted one of their own who stays too long in the political arena. They like to come and go, for then they are not responsible.

 

Yet more and more of the corporate executives have entered government directly; and the result has been a virtually new political economy at the apex of which we find those who represent the corporate rich.*

 

 

* See below, TWELVE: The Power Elite, for a fuller discussion of the political role of the executives.
 

The questions which these obvious facts of the political power of the corporate rich raise have to do not so much with the personal integrity of the men involved, and certainly not so much with their personal gains in wealth, prestige, and power.

 

These are important questions which we shall discuss when we note the general prevalence of the higher immorality and the structure of the power elite as a whole. But the important political question is whether or not these facts can be added up to proof of a structural connection between the corporate rich and what we shall call the political directorate.

Have the very rich and the top executives, the upper classes of local society and of the metropolitan 400, the strategic cliques of the corporate world, actually occupied many positions of power within the formal political system? They have, of course, made raids upon the government, they have gained privileges within it.

 

But have they been and are they now active politically? Contrary to official legend, scholarly myth, and popular folklore, the answer to that question is a complicated but a quite definite Yes.

We should, however, be quite mistaken to believe that the political apparatus is merely an extension of the corporate world, or that it has been taken over by the representatives of the corporate rich. The American government is not, in any simple way nor as a structural fact, a committee of 'the ruling class.' It is a network of 'committees,' and other men from other hierarchies besides the corporate rich sit in these committees.

 

Of these, the professional politician himself is the most complicated, but the high military, the warlords of Washington, are the newest.

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8 - The Warlords

DURING the eighteenth century, observers of the historic scene began to notice a remarkable trend in the division of power at the top of modern society: Civilians, coming into authority, were able to control men of military violence, whose power, being hedged in and neutralized, declined.

 

At various times and places, of course, military men had been the servants of civilian decision, but this trend - which reached its climax in the nineteenth century and lasted until World War I - seemed then, and still seems, remarkable simply because it had never before happened on such a scale or never before seemed so firmly grounded.

In the twentieth century, among the industrialized nations of the world, the great, brief, precarious fact of civilian dominance began to falter; and now - after the long peace from the Napoleonic era to World War I - the old march of world history once more asserts itself. All over the world, the warlord is returning. All over the world, reality is defined in his terms. And in America, too, into the political vacuum the warlords have marched.

 

Alongside the corporate executives and the politicians, the generals and admirals - those uneasy cousins within the American elite-have gained and have been given increased power to make and to influence decisions of the gravest consequence.
 

1 - All politics is a struggle for power; the ultimate kind of power is violence. Why, then, is not military dictatorship the normal and usual form of government? For the greater part of human history, men have, in fact, lived under the sword, and in any serious disturbance of human affairs, real or imagined, societies do tend to revert to military rule.

 

Even nowadays, we often overlook these more or less common facts of world history because we inherit certain values which, during the eighteenth and nineteenth centuries, have flourished under a regime of civilian authority. Even if the ultimate form of power is coercion by violence, all power contests within and between nations of our tradition have not reached the ultimate point.

 

Our theories of government have assumed and our constitution has led to institutions in which violence has been minimized and subjected to efficient checks in the balance of civilian dominance. During the long peace of the modern west, history has been referred more to the politician, to the rich and to the lawyer than to the general, the bandit, and the admiral.

 

But how did that peace come about? How did civilians rather than men of violence become dominant?

In his discussion of the military, Gaetano Mosca1 makes an assumption which we do not share, but which does not disturb our acceptance of his general line of reasoning. He assumes that, in any society, there is a sort of quota of men who when appropriately provoked will resort to violence. If, says Mosca, we give such men genius and the historical opportunity, we will get a Napoleon; if we give them a great ideal, we will get a Garibaldi; if we give them a chance, and nothing else, we will get a Mussolini or, we may add, in a business civilization, a gangster.

But, says Mosca, if you give such a man a job in a certain kind of social hierarchy, you will get a professional soldier and often civilians can control him.

Of course, there have been bases of internal peace other than the professional standing army. There has been 'God's peace' imposed by a priesthood, and the 'King's Peace' imposed in medieval Europe against those who felt that their honor and power depended upon the sword.

 

But the big fact about peace in modern, or even in world history, is - as one might expect - an ambiguous fact: it is that peace has been due to the centralization and monopoly of violence by the national state, but that the existence of a world now organized into some eighty-one such national states is also the prime condition of modern war.

Before the national state, men of violence could and did frequently resort to violence on a local scale, and feudalism in Europe as well as in the Orient was in many ways a local rule by men of violence. Before the national state centralized and monopolized the means of violence, power tended continually to re-create itself in small, scattered centers, and rule by local gangs was often a going fact of the pre-national history of mankind.

 

But the highwayman of Spain became - under Ferdinand and Isabella who were building a nation - a man of the crown, and in due course a conquistador and in due course again, a soldier of the queen.

 

The man of local violence came, in short, to be a member of a national standing army beholden to the civilian head of the state.

• Now what kind of remarkable institution is this standing army that it can channel the combative tendencies of men of violence so that they come under civilian authority, and in fact adopt among themselves such obedience as their very code of honor?

• For if the standing army, in the modern nation, has come to monopolize violence, to become strong enough to dominate society, why has it not done so?

• Why, instead, has it quite frequently tapered up to and accepted the civilian authority of the civilian head of the state?

• Why do armies subordinate themselves?

• What are the secrets of the standing army?

There are no secrets, there are several quite open mechanisms which have been at work wherever standing armies are under civilian control.

 

First of all, these armies have been 'aristocratic' kinds of institutions. Whenever, as in the early Bolshevik enthusiasm, attempts have been made to do away with this character, they have failed. There is maintained in the national standing army an absolute distinction between officers and men; and the officer group has generally been recruited from among the ruling strata of the civilian population or from those who sympathize with their interests; accordingly, the balance of forces within the ruling strata has been reflected within the standing army.

 

And finally, there have developed in this standing army, or in many of them, certain gratifications which even men of violence often want: the security of a job, but more, the calculable glory of living according to a rigid code of honor.

'Is it to be supposed,' John Adams asked in the late eighteenth century, 'that the regular standing armies of Europe, engage in the service, from pure motives of patriotism? Are their officers men of contemplation and devotion, who expect their reward in a future life? Is it from a sense of moral, or religious duty that they risk their lives, and reconcile themselves to wounds? Instances of all these kinds may be found.

 

But if any one supposes that all, or the greater part of these heroes, are actuated by such principles, he will only prove that he is unacquainted with them. Can their pay be considered as an adequate encouragement? This, which is no more than a very simple and moderate subsistence, would never be a temptation to renounce the chances of fortune in other pursuits, together with the pleasures of domestic life, and submit to this most difficult and dangerous employment.

 

No, it is the consideration and the chances of laurels, which they acquire by the service.

'The soldier compares himself with his fellows, and contends for promotion to be a Corporal: the Corporals vie with each other to be Sergeants: the Sergeants will mount breaches to be Ensigns: and thus every man in an army is constantly aspiring to be something higher, as every citizen in the commonwealth is constantly struggling for a better rank, that he may draw the observation of more eyes."

 

 

2 - Prestige to the point of honor, and all that this involves, has, as it were, been the pay-off for the military's renunciation of political power.

 

This renunciation has gone quite far: it has been incorporated in the military code of honor. Inside their often trim bureaucracy, where everything seems under neat control, army officers have felt that 'politics' is a dirty, uncertain, and ungentlemanly kind of game; and in terms of their status code, they have often felt that politicians were unqualified creatures inhabiting an uncertain world.

The status mechanisms of the standing army have not always worked to the end of civilian dominance, and there is nothing inevitable about their working to that end. We know, for example, that the curse of the nations of the Spanish world has been the fact that whenever army officers have gotten a foothold in the councils of state, they have tried to dominate them, and that when they have no foothold in those councils, they may march upon the capital.

All of these reflections, having to do with world trends and world facts, bear in an especially acute way on the situation of the American military establishment and its higher echelons of generals and admirals. Like other nations, the United States was born in violence, but it was born at a time when warfare did not seem to be a dominating feature of human society.

 

And it was born in a place which could not easily be reached by the machines of war, was not easily open to the devastation of war, not subject to the anxiety of those who live in military neighborhoods. In the time and place of its earlier period, the United States was well situated to erect and to maintain a civilian government, and to hold well subordinated such militarist ambition as might prevail.

A young country whose nationalist revolution was fought against mercenary soldiers, employed by the British and quartered in American homes, would not be likely to love professional soldiers.

 

Being a wide, open land surrounded by weak neighbors, Indians and wide oceans, the sovereign United States for the long decades of the nineteenth century did not have to carry the burden of a permanent and large military overhead. Moreover, from the time of the Monroe Doctrine until it was applied to Britain in the later part of the nineteenth century, the British fleet, in order to protect British markets in the western hemisphere, stood between the United States and the continental states of Europe.

 

Even after World War I, until the rise of Nazi Germany, the America that had become creditor to the bankrupt nations of Europe had little military threat to fear.³

 

All this has also meant that, as in the islands of Britain, a navy rather than an army was historically the prime military instrument; and navies have much less influence upon national social structures than armies often have, for they are not very useful as a means of repressing popular revolt. Generals and admirals, accordingly, did not play much of a role in political affairs and civilian dominance was firmly set.

A country whose people have been most centrally preoccupied by the individual acquisition of wealth would not be expected to favor subsidizing an organized body of men who, economically speaking, are parasitical.

 

A country whose middle class cherished freedom and personal initiative would not be likely to esteem disciplined soldiers who all too often seemed to be tyrannically used in the support of less free governments. Economic forces and political climate, therefore, have historically favored the civilian devaluation of the military as an at-times necessary evil but always a burden.

The Constitution of the United States was constructed in fear of a powerful military establishment. The President, a civilian, was declared commander-in-chief of all the armed forces, and during war, of the state militia's as well. Only Congress could declare war, or vote funds for military use - and for only two years at a time. The individual states maintained their own militia, separate and apart from the national establishment. There was no provision for a flow of advice from military to civilian chiefs. If there were provisions for violence in the constitution, they were reluctant provisions, and the agents of violence were held to a strictly instrumental role.

After the revolutionary generation, the upper classes were not of a military stamp; the American elite did not systematically include among its members high-ranking military figures; it developed no firm tradition of military service; prestige was not rendered to military servants.

 

The ascendancy of economic over military men in the sphere of 'honor' was made quite apparent when, during the Civil War, as indeed up to World War I, the hiring of a substitute for the draft was not looked down upon. Military men, accordingly, on their often isolated posts along the old internal frontier, did not enter the higher circles of the nation.

No matter what hardships, and they were often severe, were encountered by those who crossed the hemisphere and no matter how military their expeditions and communities - and in many ways they were for considerable periods definitely camps of war-still those who headed the nation were not stamped with the military mind and the military outlook.

And yet, considering the whole of United States history, we are confronted with a rather curious situation: we are told that we have never been and are not a militarist nation, that in fact we distrust the military experience, yet we note that the Revolution led to the ascendancy of General Washington to the Presidency, and that there were bids among certain rejected officers, in the Order of Cincinnati, to form a military council and install a militarist king.

 

Then too, frontier battling and skirmishes had something to do with the political success of Generals Jackson, Harrison, and Taylor in the Mexican War. And there was also the Civil War, which was long and bloody and split American society across the middle, leaving scars that still remain much in evidence. Civilian authority, on both sides, remained in control through it and after it, but it did lead to the ascendancy of General Grant to the Presidency, which became a convenient front for economic interests.

 

All the Presidents from Grant through McKinley, with the exceptions of Cleveland and Arthur, were Civil War officers, although only Grant was a professional. And again, with the little Spanish-American War, we note that the roughest, toughest of them all - perhaps because he was not a professional - Theodore Roosevelt - emerged in due course in the White House. In fact, about half of the thirty-three men who have been President of the United States have had military experience of some sort; six have been career officers; nine have been generals.

From Shays' Rebellion to the Korean War there has been no period of any length without official violence.

 

Since 1776, in fact, the United States has engaged in seven foreign wars, a four-year Civil War, a century of running battles and skirmishes with Indians, and intermittent displays of violence in China, and in subjugating the Caribbean and parts of Central America.*

 

 

* In 1935, the editors of Fortune wrote: "It is generally supposed that the American military ideal is peace. But unfortunately for this high-school classic, the U.S. Army, since 1776, has filched more square miles of the earth by sheer military conquest than any army in the world, except only that of Great Britain. And as between Great Britain and the U.S. it has been a close race, Britain having conquered something over 3,500,000 square miles since that date, and the U.S. (if one includes wresting the Louisiana Purchase from the Indians) something over 3,100,000. The English-speaking people have done themselves proud in this regard.'4

 

 

All of these occurrences may have been generally regarded as nuisances interfering with the more important business at hand, but, at the very least, it must be said that violence as a means and even as a value is just a little bit ambiguous in American life and culture.

The clue to this ambiguity lies in this fact: historically, there has been plenty of violence, but a great deal of it has been directly performed by 'the people.' Military force has been decentralized in state militia almost to a feudal point. Military institutions, with few exceptions, have paralleled the scattered means of economic production and the confederate means of political power.

 

Unlike the Cossacks of the Eurasian Steppes, the technical and numerical superiority of the American frontiersman who confronted the American Indian made it unnecessary for a true warrior stratum and a large, disciplined administration of violence to emerge. Virtually every man was a rifleman: given the technical level of the warfare, the means of violence remained decentralized.

 

That simple fact is of the greatest consequence for civilian dominance as well as for the democratic institutions and ethos of earlier times in America.

Historically, democracy in America has been underpinned by the militia system of armed citizens at a time when the rifle was the key weapon and one man meant one rifle as well as one vote. Schoolbook historians, accordingly, have not been prone to think about changes in American military institutions and weapons systems as causes of political and economic changes. They bring out military forces for an Indian skirmish and a distant war, and then they tuck them away again. And perhaps the historians are right.

 

But the first armies in Europe based on universal conscription, it ought to be remembered, were revolutionary armies. Other countries armed their populations reluctantly; Metternich at the Congress of Vienna urged the abolition of mass conscription; Prussia adopted it only after her professional army suffered defeats without it; the Tzars, only after the Crimean war; and Austria, only after Bismarck's recruits defeated Franz Josef's troops.⁵

The introduction of mass conscript armies in Europe involved the extension of other 'rights' to the conscripts in an effort to strengthen their loyalties. In Prussia, and later in Germany, this was a quite deliberate policy. The abolishment of serfdom and later the development of social-security plans accompanied the establishment of mass conscription.

 

Although the correspondence is not exact, it seems clear that to extend the right to bear arms to the population at large has involved the extension of other rights as well. But in the United States, the right to bear arms was not extended by an arms-bearing stratum to the population bore arms from the beginning. an unarmed population:

Up to World War I, military activities did not involve the discipline of permanent military training, nor a monopoly of the tools of violence by the federal government, nor the professional soldier at the top of a large and permanent military establishment. Between the Civil War and the Spanish-American War, the army averaged about 25,000 men, organized on a regimental basis, with regiments and companies largely scattered on posts along the internal frontier and farther west.

 

Through the Spanish-American War, the United States Army was militia-organized, which meant decentralized and with an unprofessional officer corps open to much local influence.

The small regular army was supplemented by state militias formed into The US Volunteers, the commanders of these troops being appointed by the governors of the states. In this quite unprofessional situation, regular army men could be and often were jumped to generalship in The Volunteers. Folitics - which is also to say civilian control - reigned supreme.

 

At any given time, there were few generals, and the rank of colonel was often even the West Pointer's height of aspiration.
 

 

3 - Around the old army general of the late nineteenth century, in his neatly disheveled blue uniform, there hang wisps of gun smoke from the Civil War. In the Civil War he had distinguished himself, and between that war and the Spanish-American fracas he had fought Indians in a most adventurous way.

 

The dash of the cavalry has rubbed off on him - even if at times making him something of a dashing imbecile (Remember Custer and the Little Big Horn!). He lives something of the hardy life which Theodore Roosevelt esteemed. He often wears a mustache, and sometimes a beard, and usually he has a certain unshaven look.

 

Grant had worn a private's uniform with unshined buttons and ancient boots and the manner carried on. This old army man has fought up-close: it was not until World War I that an official effort was made 'to conserve trained personnel'; many generals and dozens of colonels were killed in Civil War battles or afterward in Indian skirmishes.

He did not earn the respect of his men by logistical planning in the Pentagon; he earned it by better shooting, harder riding, faster improvisation when in trouble.

The typical general of 19006 was of an old American family and of British ancestry. He was born about 1840 in the northeastern section of the United States and probably grew up either there or in the north central section, in a rural area or perhaps a small town. His father was a professional man, and the chances are fairly good that his father had political connections - which may or may not have aided him in his career. It took him a little more than thirty-eight years to become a major-general from the time he entered the army or West Point.

 

When he came into top command, he was about sixty years old. If he was religious he probably attended the Episcopal church. He married, sometimes twice, and his father-in-law, also a professional, might also have had some political connections. While in the service, he did not belong to a political party; but after retirement, he may have dabbled a bit in Republican politics.

 

It is as unlikely that he wrote anything as that someone wrote very much about him. Officially, he had to retire at sixty-two; and he died, on the average, at the age of seventy-seven.

Only a third of these old army generals had been to West Point and only four others had completed college; the old army did not go to school. But we must remember that many southerners - who had been West Pointers and who had predominated in the old federal army - had gone home to fight in the Confederate army. Sometimes the army general of 1900 had been commissioned during the Civil War, sometimes he had come up through the volunteers of the state militia, sometimes he had personally recruited enough men and then he was a colonel.

 

After he was in the regular army, his promotion was largely by seniority, which was greatly speeded up during wars, as during his jump from colonelcy during the Spanish-American War. At least half of the old army generals had higher connections with generals and politicians.

 

General Leonard Wood, for example, who was a medical captain in 1891, became White House physician, and later, under his friends, Theodore Roosevelt and William Howard Taft, ended up in 1900 as Chief of Staff.

Only three of the top three-dozen army men ever went into business - and two of these were non-regulars. Local merchants in frontier towns often loved this old army; for it fought Indians and cattle thieves and the army post meant money for the local economy. And in larger towns, the army was at times authorized to break strikes. Small boys also loved it.

Between the Civil War and the naval expansion under Theodore Roosevelt, the army was more in the public eye and its claims for status were cashed in by the lower classes. But the navy was more like a gentleman's club, which occasionally went on exploring and rescuing expeditions, and the prestige of the navy was among the upper classes. This explains, and is in part explained by, the higher level of origin and more professional training of its officer corps.

Apart from the British inheritance of sea power, there was the prestige of Admiral Mahan's theory, linking the greatness of the nation to her sea power, and falling easily upon the ears of Navy Undersecretary Theodore Roosevelt.

 

The higher prestige of the navy, coming to a wider public during the Spanish-American War, has been due to the fact that the skills of the naval officer were more mysterious to laymen than those of the army - few civilians would dare try to command a ship, but many might a brigade.

 

Since there was not, as in the army, a volunteer system - there was the prestige of skill augmented by the prestige of a formal, specialized education at Annapolis. There was also the fact of heavy capital investment, represented by the ships in the naval officer's command. And finally, there was the absolute authority that The Master of a ship exercises - especially in view of the sea tradition of contempt for the deckhand, which, applied to the enlisted sailors, lifted the officers high indeed.

The typical admiral of 1900 was born about 1842 of colonial stock and British ancestry. His father had a professional practice of one kind or another; but more important, he was of the upper levels of the northeastern seaboard, more likely than not of an urban center.

 

The future admiral had the academy education plus two years on a receiving ship. He was only fourteen years old when he entered the navy; and if he was religious, he was definitely Protestant. Some forty-three years after he was accepted at the Academy he became a rear admiral.

 

He was then fifty-eight years old. He had married within his own class level. He probably wrote one book, but chances were less that someone wrote a book about him; he may, however, have received an honorary degree after the war of 1898; and he retired from the navy at sixty-two years of age.

 

He had held the rank of rear admiral for only three years; and he died ten years after compulsory retirement at the average age of seventy-two.

Even in 1900, the top of the navy was strictly Annapolis, and gentlemanly too. Recruited from higher class levels than the army, residing more in the East, having had better preparatory training and then the Academy, the admiral had also served in the Civil War, after which he slowly rose by avoiding innovation, in personal life or in military duties.

 

Given the meticulous crawl of his career, it was important that he be commissioned early and live long, in order to reach admiralcy before compulsory retirement at sixty-two.

 

It usually took some twenty-five years to become a captain.

'Officers spent so long a time in the lower subordinate grades that they never learned to think for themselves. They usually reached command ranks so late that they had lost their youth and ambition and had learned only to obey, not to command...'*

 

* 'In December 1906, the age of the youngest captain in the American Navy was 55 and the average time spent in that grade was 4.5 years; in Great Britain the youngest captain was 35 and the average time spent in that grade was 11.2 years.' The figures for France, Germany, and Japan are similar to the British. 'The same situation was true of the flag officers. In the United States they usually averaged only 1.5 years in that rank before retirement,' but in Great Britain, France, Germany, and Japan, between 6 and 14 years.⁷

From one-third to one-half of the duty of the top officers was spent at sea, occurring of course mainly while of lower rank.

 

About half of the top thirty-five naval men had returned at one time or another to Annapolis as instructors or officials. And some took postgraduate work there. But the key to the bureaucratic snafu that has often characterized the navy is that as the ships and the guns and the logistics became more technically complicated, the men who ran them acquired rank less by technical specialty than by seniority.

 

Accordingly, the skipper became somewhat alienated from his ship and had to take responsibility for matters which he did not altogether understand. The bureau heads, who ran the navy, had access to the Secretary, and were often thick with Congressmen. But despite the prominent connections, only one ad-admiral of this period went into business, and only two went into (local) politics.

Such, in brief, was the civilian controlled military establishment of the United States in the later nineteenth century, with its half-professionalized high officer corps, whose members were not in any important sense of the American elite of businessmen and politicians.

 

But this is not the later nineteenth century, and most of the historical factors which then shaped the military roles within the nation no longer exert the slightest influence on the shape of the higher echelons of America.

 

4 - In the middle of the twentieth century, the influence of such peaceful and civilian values as exist in the United States - and with them the effective distrust and subordination of professional military men - must be balanced by the unprecedented situation which the American elite now defines as the situation of the nation:
 

1. For the first time, the American elite, as well as effective sections of the underlying population, begin to realize what it means to live in a military neighborhood, what it means to be technically open to catastrophic attack upon the national domain.

    

   Perhaps they also realize how very easy a military time the United States as a nation has had, given its geographical isolation, its enlarging and pacified domestic market, its natural resources needed for industrialization, and requiring military operations only against a technologically primitive population.

    

   All that is now history: the United States is now as much a military neighbor of the Soviet Union - or even more so - as Germany has been of France in previous centuries.
   
    

2. This is brought home, immediately and dramatically, by the more careful estimates, now publicly available, of the physical effects of the latest weapons system. One saturation attack, it is not unreasonable to suppose, would result in some 50 million casualties, or nearly one-third of the population.⁸

    

   That the United States could immediately retaliate with comparable effects upon the enemy does not, of course, lessen those upon her own domain and population.
   
   Such technical possibilities may be taken in a political and an industrial way, or in their strictly military meaning. The American elite in charge of that decision have taken them primarily in their military meaning. The terms in which they have defined international reality are predominantly military. As a result, in the higher circles there has been a replacement of diplomacy in any historically recognized sense by calculations of war potential and the military seriousness of war threats.
   
   Moreover, the new weaponry has been developed as a 'first line of defense.' Unlike poison gas and bacteria, it has not been considered as a reserve against its use by the enemy, but as the major offensive weapon.

    

   And such grand strategy as has been made public has been officially based upon the assumption that such weapons will be used during the first days of general war. Indeed, that is now the common assumption.
   
    

3. These definitions of reality and proposed orientations to it have led to a further feature of America's international posture: for the first time in American history, men in authority are talking about an 'emergency' without a foreseeable end. During modern times, and especially in the United States, men had come to look upon history as a peaceful continuum interrupted by war.

    

   But now, the American elite does not have any real image of peace  - other than as an uneasy interlude existing precariously by virtue of the balance of mutual fright. The only seriously accepted plan for 'peace' is the fully loaded pistol. In short, war or a high state of war preparedness is felt to be the normal and seemingly permanent condition of the United States.
   
    

4. The final new feature we would mention of the United States situation, as now officially defined, is even more significant. For the first time in their history, the American elite find themselves confronting a possible war which they admit among themselves and even in public, that none of the combatants would win.

    

   They have no image of what 'victory' might mean, and they have no idea of any road to victory. Certainly the generals have no idea. In Korea, for example, it became quite clear that the stalemate was produced by 'a paralysis of will' on the political level. Lieutenant-Colonel Melvin B. Voorhees reports the following from an interview with General James Van Fleet:

   • 'Reporter: "General, what is our goal?"

   • Van Fleet: "I don't know. The answer must come from higher authority."

   • Reporter: "How may we know, General, when and if we achieve victory?"

   • Van Fleet: "I don't know, except that somebody higher up will have to tell us."' 'That,' commented a Time editoralist, 'sums up the last two years of the Korean war.'⁹

    

   In previous times, leaders of nations in preparing for war had theories of victory, terms of surrender, and some of them at least were confident of the military means of imposing them.

    

   By World War II, the United States war aims had become quite vague in any political or economic sense, but there were strategic plans for victory by violent means. But now there is no literature of victory. Given the means of violence that now exist, 'massive retaliation' is neither a war plan nor an image of victory, but merely a violent diplomatic - which is to say political - gesture and a recognition that all-out war between two nations has now become the means of their mutual destruction.

    

   The position amounts to this: with war all nations may fall, so in their mutual fright of war, they survive. Peace is a mutual fright, a balance of armed fear.

I am not concerned, at this point, to debate any of the definitions of reality that play into the national position or the policies of the United States.

 

Yet given these features of the world situation as it is officially defined today, we ought to realize that orthodox military strategy and military expertise of all types have become irrelevant and misleading in all decisions about world affairs that might lead to peace. Clearly all the decisive problems, foremost among them, the problems of war and peace, now become in a more complete sense than ever before, political problems.

 

Whether NATO has ten or thirty divisions is, from a military standpoint, as irrelevant as whether Germany is or is not to be rearmed. In the light of the now established facts concerning the effect of all-out bombing, such questions have ceased to be military issues of the slightest importance. They are political questions concerning the ability of the United States to line up the nations of Europe.

But: given the military definition of reality that prevails among the men with the power of decision, the rise of the generals and the admirals into the higher circles of the American elite becomes completely understandable and legitimate, completely realistic and desirable. For this new international position of the United States, and the new international context itself - both as defined by the elite - have made for a change in their focus of attention.

 

The rise to enlarged command and increased status of the warlords of Washington is but the most obvious sign of this broadening of attention. Decisions of the greatest consequence have become largely international. If it is too much to say that, for many of the elite, domestic politics have become important mainly as ways of retaining power at home in order to exert abroad the power of the national establishment, surely it is true that domestic decisions in virtually all areas of life are increasingly justified by, if not made with, close reference to the dangers and opportunities abroad.

At the same time, it is not strange that there has been civilian alarm in high places over the increased power of the warlords. This alarm would be more responsible if it led to effective challenge of the military definition of reality in favor of political and economic and human images of world affairs.

 

But then, it is easier to be alarmed over warlords, who, of course, are both a cause and a result of the definitions of reality that prevail.
 

 

5 - As the American means of violence have been enlarged and centralized, they have come to include an enormously complicated bureaucratic structure, reaching to the rimlands of Asia and well into the peninsula of Europe with its instruments of perception, and into the heart of Eurasia with its strategic air force.

 

Such changes in the institutions and reach of the means of violence could not but make equally significant changes in the men of violence: the United States warlords.

The most dramatic symbol of the scale and shape of the new military edifice is the Pentagon.10 This concrete and limestone maze contains the organized brain of the American means of violence. The world's largest office building, the United States Capitol would fit neatly into any one of its five segments.

 

Three football fields would reach only the length of one of its five outer walls. Its seventeen and a half miles of corridor, 40,000-phone switchboards, fifteen miles of pneumatic tubing, 2,100 intercoms, connect with one another and with the world, the 31,300 Pentagonians. Prowled by 170 security officers, served by 1,000 men and women, it has four full-time workers doing nothing but replacing light bulbs, and another four watching the master panel which synchronizes its 4,000 clocks.

 

Underneath its river entrance are five handball courts and four bowling alleys. It produces ten tons of non-classified waste paper a day, which is sold for about $80,000 a year. It produces three nation-wide programs a week in its radio-TV studio. Its communication system permits four-party conversations between people as far apart as Washington, Tokyo, Berlin, and London.

This office building, in this intricate architectural and human maze, is the everyday milieu of the modern warlords. And no Indian fighters are to be found among them.

At the head of the military bureaucracy, below the President of the United States and the Secretary of Defense, whom he appoints, and his assistants, there sits, behind office walls of sheet steel, a military board of directors - the Joint Chiefs of Staff. Immediately below the Joint Chiefs there is a higher circle of generals and admirals which presides over the elaborate and far-flung land, sea, and air forces, as well as the economic and political liaisons held necessary to maintain them, and over the publicity machines.

Since Pearl Harbor, in a series of laws and directives, a serious attempt has been made to unify the several branches of the service. Easier civilian control would result from such unity; but it has not been altogether successful. The high navy especially, has often felt neglected; and each of the services has, on occasion, gone to Congress over the head of its Secretary - the air force at one time even winning its point against the opposition of the Secretary.

 

In 1949, the Hoover Commission reported that the military establishment lacked central authority and adequate budgetary routines; that it was not a 'team,' and that the link between scientific research and strategic plans was weak.

'The lack of central authority in the direction of the national military establishment, the rigid statutory structure established under the act, and divided responsibility have resulted in a failure to assert clear civilian control over the armed forces.'¹¹

At the very top, among civilians and military, there have been, since World War II, sweeping changes of personnel - although the types of men have not decisively changed.12 As Secretary, there has been a politician, a broker, a general, a banker, a corporation executive. Directly confronting such men, sit the four highest military who are 'all military.'*

 

 

*The chairman of the Joint Chiefs of Staff, Admiral Arthur W. Rad-ford, is the son of a civil engineer; the Chief of Naval Operations, Admiral Robert B. Carney, is the son of a navy commander; the Army Chief of Staff, General Matthew B. Ridgway, is the son of a regular army officer; and the Chief of Staff of the Air Force, General Nathan F. Twining, has two brothers who are Annapolis men.¹³

 

 

From the military's standpoint, perhaps the ideal civilian at the top would be a front to Congress but a willing tool of military decision. But this is not always the type that prevails. Recently, for example, the Secretary of the Navy moved an admiral out of a top job for reasons of 'policy differences.'¹⁴ There is undoubtedly tension, the men on either side being, like all men, to some degree prisoners of their pasts.

There are, of course, cliques among the high military, variously related to one another and variously related to given civilian policies and cliques. These become apparent when hidden tensions become open controversies - as at the time of MacArthur's dismissal from his Eastern command. At that time there was, in addition to the MacArthur school of Asia First, already declining in influence, the Marshall-set who gave priority to Europe.

 

There was also the Eisenhower-Smith group, which had great influence but did not run the army; and there was the dominant group who did run it, the Bradley-Collins team.** ¹⁵⁰

 

 

** The Joint Chiefs of Staff appointed in 1953, for example, have all held major commands in the Pacific, and there was some feeling upon their appointment that they were more Asia-minded than the more European-minded Bradley, Collins, Vandenberg, and Fechteler they replaced. All of them were also reported to favor the tactical side of air warfare as over the strategic - at least they were not pure and simple 'big-bomb' men. Admiral Radford, in fact, as commander-in-chief of the Pacific fleet led the 'revolt of the admirals' against the B-36 in the budget controversy of 1949.¹⁶

 

 

And there is the rather standard split between those who feel that the need of the services is for 'truly professional armed forces' commanded by 'combat line officers' and those who are happier about the rise of the new 'specialists' and staff men.¹⁷

As the military increase in power, more tense cliques will probably develop among them, despite 'unification' - which is, of course, by no means completed. When the military are a minority fighting for survival, they are more likely to hang together than when they are dominant members of the power elite, for then it is no question of survival but of expansion.

In the early twentieth century, the militia system had been centralized; and now the weapons systems have developed to the point where rifles are mere toys. The arming of the citizen is now within a disciplined organization under firmly centralized control, and the means of suppressing illegitimate violence have increased. As a result, those outside the military ruling circles are helpless militarily.

 

Yet, at the same time, virtually the entire population is involved in war, as soldiers or as civilians - which means that they are disciplined in a hierarchy at whose head there sit the warlords of Washington.

 

6 - The nearest the modern general or admiral comes to a small-arms encounter of any sort is at a duck hunt in the company of corporation executives at the retreat of Continental Motors, Inc.

 

One insurance company, in fact,

'has been insuring officers for a decade and a half, went through World War II... and survived... during the Korean War, the mortality rate of officer policyholders serving in the battle zone was below the average for industry as a whole.'¹⁸

As a further fact, Brigadier General S.L.A. Marshall's studies have revealed that in any given action of World War II, probably no more than 25 per cent of the soldiers who were in a position to fire their weapons at the enemy actually pulled the trigger.¹⁹

The general and the admiral are more professionalized executives than inherited images of fighting men would suggest. Two-thirds of the top generals of 195020 graduated from The Point (all of the admirals, both in 1900 and 1950, graduated from the Naval Academy); most saw service in World War I, and most of them lived through the general anti-militarist peace of the 'twenties and 'thirties, begging for appropriations, denying the merchants-of death charges. Above them all towered the spit-and-polish image of Pershing.

During the interwar years nothing really happened in their professional lives. It was in some ways as if a doctor were passing his life without seeing any patients, for the military were not called upon really to exercise their professional skill. But they had the services.

 

Perhaps that is the clue to their development in such periods: in them there is intensified the desire, too deeply rooted to examine, to conform to type, to be indistinguishable, not to reveal loss of composure to inferiors, and above all, not to presume the right to upset the arrangements of the chain of command.

 

It was important that those above them could not find anything against them; and, at home and abroad, the life of the professional military went on in their own little colonies, quite insulated from the economic and political life of the nation. In the civilian distrust that prevailed, the military were supposed to 'stay out of politics,' and most of them seemed glad to do so.

The military life of the interwar officer revolved around his rank. Through the rank of colonel, promotion was by seniority, and standing before the officer was 'the hump' - a concentration of four or five thousand officers, most of them commissioned during World War I.

 

As a result of this hump, it took a man 'twenty-two years to climb from the junior captain to the senior captain.' He could 'scarcely hope to top the grade of captain before reaching his fifties.'²¹

The social life of the interwar officer also revolved around his rank. Toward the world of civilians, as well as among their unappreciated selves, there was intense consciousness of rank.

 

General George C. Marshall's wife, remembering this period, recalls an officer's wife remarking,

'At a tea such as this one you always ask the highest-ranking officer's wife to pour coffee, not tea [because] coffee outranks tea.'

She also remembers the life of the colonel in the slump when - as she elsewhere notes - the army was so pressed for funds that target practice was curtailed:

'Our quarters at Fort Moultrie were not a home, but a hotel. The house had been built by the Coast Artillery in its balmy days, but now the place was in bad repair. It had 42 French doors leading out on the lower and top verandas, which extended around three sides of the house.'

And when Marshall became a general: 'In front of the cottage stood a beautiful new Packard car - to replace our little Ford. So he had one thrill out of his generalcy, for a Packard in those times of depression was indeed a marvelous thrill. I was quite overcome with joy.'²²

Another colonel's lady remembers the rank order among wives:

'When someone suggested that a committee be selected to buy the books, the doctor's wife, who knew my weakness, murmured my name, but the colonel's wife appointed the three highest ranking ladies present.'

And she too remembers the life abroad among higher military personnel:

'In China our domestic staff had consisted of five... The pay freeze [during the slump] which cut out these automatic increases hurt more junior than senior officers. No general was affected by it, and only one admiral. Seventy-five per cent of the loss, in the army, was stood by lieutenants, captains, warrant officers and nurses.'²³

It was in these interwar days that second-lieutenant Eisenhower met Mamie Doud, whose father was prosperous enough to retire to leisure in Denver at the age of thirty-six and, with his family, winter in San Antonio.

It is reported, as of 1953, that 'a typical career officer at age forty-five or fifty may accumulate as much as $50,000 of insurance over the years.'25 And of the interwar naval officer's life, it has been said:

'The summer cruises were exciting, and the gold stripes and extra privileges of upper-class life made you begin to feel like somebody after all. And you ... learned good manners, and visited your roommate's home in Philadelphia one Christmas holiday and got your first taste of the social pampering in store for personable young navy men... you listened to so many lectures admonishing you not to consider yourself superior to a civilian that you found yourself feeling that you really were a cut above, but that it would be improper to show that you thought so.'²⁶

Yet it has not generally been true in the United States that, as Veblen would have it, since 'war is honorable, warlike prowess is honorific.'²⁷ Nor has it been true that military officers have generally derived from, or become, members of Veblen's leisure class.*

* 'While it is a fact that our army officers are better paid than any others in the world,' it was authoritatively stated in 1903, 'yet the pursuit of the profession of arms offers to our men no pecuniary inducement. If they do not possess outside sources of income, they are expected to live within their pay; sixty per cent, or more, have no income beyond their pay [40 per cent did]... Most prized of all the details, probably, is that of military attache at one of the United States legations abroad... Officers who accept such posts generally have outside incomes of their own or such as are derived through their family connections.'²⁸
 

It is more true of the navy than of the army - the air force is too new for such developments. On the whole, the high officers of the army and navy have been men of the upper-middle rather than truly higher or definitely lower classes. Only a very small percentage of them are of working-class origin.

 

They have been the sons of professional men, of businessmen, of farmers, of public officials, and of military men. They are overwhelmingly Protestant, mainly Episcopalians or Presbyterians. Few have served in the ranks.²⁹

And for almost all of them of today, World War II is the pivotal event. It is the pivot of the modern military career and of the political and military and social climate in which that career is being enacted.

 

Younger men among the top today saw combat duty in leading regiments or divisions, and older men, rapidly advanced in the great expansion, rose to the top headquarters at home and abroad.

 

7 - Social origins and early backgrounds are less important to the character of the professional military man than to any other high social type.

 

The training of the future admiral or general begins early and is thus deeply set, and the military world which he enters is so all-encompassing that his way of life is firmly centered within it. To the extent that these conditions exist, whether he is the son of a carpenter or a millionaire is that much less important.

The point should not, of course, be pushed too far. Although the military is the most bureaucratic of all types within the American elite, it is not absolutely bureaucratic, and, as in all bureaucracies, on its higher levels it becomes less so than on its lower and middle. Nevertheless, when we examine the military career, one fact appears to be so central that we need not go far beyond it.

 

That fact is that for most of their careers, the admirals and the generals have followed a quite uniform and pre-arranged pattern. Once we know the ground rules and the pivotal junctures of this standardized career, we already know as much as we can find out from the detailed statistics of a multitude of careers.

The military world selects and forms those who become a professional part of it. The harsh initiation at The Point or The Academy - and on lower levels of the military service, in basic training - reveals the attempt to break up early civilian values and sensibilities in order the more easily to implant a character structure as totally new as possible.

It is this attempt to break up the earlier acquired sensibilities that lies back of the 'breaking' of the recruit and the assignment to him of very low status in the military world. He must be made to lose much of his old identity in order that he can then become aware of his very self in the terms of his military role.

 

He must be isolated from his old civilian life in order that he will come eagerly to place the highest value on successful conformity with military reality, on deep acceptance of the military outlook, and on proud realization of success within its hierarchy and in its terms. His very self-esteem becomes quite thoroughly dependent upon the appraisals he receives from his peers and his superiors in the chain of command. His military role, and the world of which it is a part, is presented to him as one of the higher circles of the nation.

 

There is a strong emphasis upon the whole range of social etiquette, and, in various formal and informal ways, he is encouraged to date girls of higher rather than of lower status. He is made to feel that he is entering upon an important sector of the higher circles of the nation, and, accordingly, his conception of himself as a self-confident man becomes based upon his conception of himself as a loyal member of an ascendant organization.

 

The only 'educational' routine in America that compares with the military is that of the metropolitan 400's private schools, and they do not altogether measure up to the military way.³⁹

West Point and Annapolis are the beginning points of the warlords, and, although many other sources of recruitment and ways of training have had to be used in the emergencies of expansion, they are still the training grounds of the elite of the armed forces.31 Most of the top generals and all of the admirals of today are of West Point or of The Academy, and they definitely feel it.

 

In fact, if no such caste feeling existed among them, these character-selecting and character-forming institutions would have to be called failures.

The caste feeling of the military is an essential feature of the truly professional officer corps which, since the Spanish-American War, has replaced the old decentralized, and somewhat locally political, militia system.

'The objective is the fleet,' naval Captain L. M. Nulton has written, 'the doctrine is responsibility, and the problem is the formation of military character.'³²

Of the period when most present-day admirals were at Annapolis, it was asserted by Commander Earle:

'The discipline of the Naval Academy well illustrates the principle that in every community discipline means simply organized living. It is the condition of living right because without right living, civilization cannot exist. Persons who will not live right must be compelled to do so, and upon such misguided individuals there must be placed restraints.

 

To these alone is discipline ever harsh or a form of punishment. Surely this is just as it should be. The world would be better if such individuals were made to feel the tyranical, unyielding, and hard-nailed fist in order to drive them from an organization to which they have not right to belong.'*

* He adds: 'On Sundays there is compulsory attendance at church ... (which helps) him to realize that he is not merely an individual but is a member of an organization even in his devotions, as is evidenced by the prayer for his brothers in the fleet, by one for his fellow members in the Academy, both of which he hears every Sunday morning...'³³

The military world bears decisively upon its inhabitants because it selects its recruits carefully and breaks up their previously acquired values; it isolates them from civilian society and it standardizes their career and deportment throughout their lives.

 

Within this career, a rotation of assignment makes for similarity of skills and sensibilities. And, within the military world, a higher position is not merely a job or even the climax of a career; it is clearly a total way of life which is developed under an all-encompassing system of discipline.

 

Absorbed by the bureaucratic hierarchies in which he lives, and from which he derives his very character and image of self, the military man is often submerged in it, or as a possible civilian, even sunk by it. As a social creature, he has until quite recently been generally isolated from other areas of American life; and as an intellectual product of a closed educational system, with his experience itself controlled by a code and a sequence of jobs, he has been shaped into a highly uniform type.

More than any other creatures of the higher circles, modern warlords, on or above the two-star rank, resemble one another, internally and externally. Externally, as John P. Marquand has observed,³⁴ their uniforms often seem to include their facial mask, and certainly its typical expressions. There is the resolute mouth and usually the steady eye, and always the tendency to expressionlessness; there is the erect posture, the square shoulders, and the regulated cadence of the walk.

 

They do not amble; they stride. Internally, to the extent that the whole system of life-training has been successful, they are also reliably similar in reaction and in outlook. They have, it is said, 'the military mind,' which is no idle phrase: it points to the product of a specialized bureaucratic training; it points to the results of a system of formal selection and common experiences and friendships and activities  - all enclosed within similar routines.

 

It also points to the fact of discipline - which means instant and stereotyped obedience within the chain of command. The military mind also indicates the sharing of a common outlook, the basis of which is the metaphysical definition of reality as essentially military reality. Even within the military realm, this mind distrusts 'theorists,' if only because they tend to be different: bureaucratic thinking is orderly and concrete thinking.

The fact that they have succeeded in climbing the military hierarchy, which they honor more than any other, lends self-assurance to the successful warlords.

 

The protections that surround their top positions make them even more assured and confident. If they should lose confidence in themselves what else would there be for them to lose? Within a limited area of life, they are often quite competent, but to them, in their disciplined loyalty, this area is often the only area of life that is truly worthwhile.

 

They are inside an apparatus of prerogative and graded privilege in which they have been economically secure and unworried. Although not usually rich, they have never faced the perils of earning a living in the same way that lower and middle-class persons have. The orderly ranks of their chain of command, as we have seen, are carried over into their social life: such striving for status as they have known has been within an unambiguous and well-organized hierarchy of status, in which each knows his place and remains within it.

In this military world, debate is no more at a premium than persuasion: one obeys and one commands, and matters, even unimportant matters, are not to be decided by voting. Life in the military world accordingly influences the military mind's outlook on other institutions as well as on its own.

 

The warlord often sees economic institutions as means for military production and the huge corporation as a sort of ill-run military establishment. In his world, wages are fixed, unions impossible to conceive. He sees political institutions as often corrupt and usually inefficient obstacles, full of undisciplined and cantankerous creatures.

 

And is he very unhappy to hear of civilians and politicians making fools of themselves?

It is men with minds and outlooks formed by such conditions who in postwar America have come to occupy positions of great decision. It cannot be said - as we shall presently make clear - that they have necessarily sought these new positions; much of their increased stature has come to them by virtue of a default on the part of civilian political men.

 

But perhaps it can be said, as C.S. Forester has remarked in a similar connection, that men without lively imagination are needed to execute policies without imagination devised by an elite without imagination.35 But it must also be said that to Tolstoy's conception of the general at war - as confidence builder pretending by his manner that he knows what the confusion of battle is all about - we must add the image of the general as the administrator of the men and machines which now make up the greatly enlarged means of violence.

In contrast with the inter-war careers and activities, the warlord of post-World War II who is slated for the top will have spent a crucial tour of duty in the Pentagon, where on the middle and lower ranks each man has a superior looking over his shoulder, and where, at the top, civilians and military look over one an-other's shoulders.

 

The army's lieutenant colonel or the navy's commander in his thirties will probably make his jump, if at all, in or quite near the Pentagon. Here, as a cog in an intricate machine, he may come into the view of those who count, here he may be picked up for staff position and later be given the forward-looking command.

 

So, in an earlier day, was Pershing impressed by George C. Marshall; so Nimitz was impressed by Forrest Sherman; Hap Arnold was impressed by Lauris Norstad; Eisenhower by Gruenther; Gruenther by Schuyler.

What will the future warlord do in the Pentagon, where there seem more admirals than ensigns, more generals than second lieutenants? He will not command men, or even for quite a while a secretary.

 

He will read reports and brief them as inter-office memos; he will route papers with colored tags - red for urgent, green for rush-rush, yellow for expedite. He will serve on one of the 232 committees. He will prepare information and opinion for those who make decisions, carefully guarding his superior's Yes. He will try to become known as a 'comer,' and, even as in the corporate world, somebody's bright young man.

 

And, as in all bureaucratic mazes, he will try to live by the book ('Standard Operating Procedure') but know just how far to stretch its letter in order to be an expediter, an operator, who on lower levels can procure another secretary for his office-unit, and on higher levels, another air wing. It is the activities of the warlords on still higher levels that we must now examine.

Back to Contents

 

 

 

9 - The Military Ascendancy

SINCE Pearl Harbor those who command the enlarged means of American violence have come to possess considerable autonomy, as well as great influence, among their political and economic colleagues.

 

Some professional soldiers have stepped out of their military roles into other high realms of American life. Others, while remaining soldiers, have influenced by advice, information, and judgment the decisions of men powerful in economic and political matters, as well as in educational and scientific endeavors. In and out of uniform, generals and admirals have attempted to sway the opinions of the underlying population, lending the weight of their authority, openly as well as behind closed doors, to controversial policies.

In many of these controversies, the warlords have gotten their way; in others, they have blocked actions and decisions which they did not favor. In some decisions, they have shared heavily; in others they have joined issue and lost.

 

But they are now more powerful than they have ever been in the history of the American elite; they have now more means of exercising power in many areas of American life which were previously civilian domains; they now have more connections; and they are now operating in a nation whose elite and whose underlying population have accepted what can only be called a military definition of reality.

 

Historically, the warlords have been only uneasy, poor relations within the American elite; now they are first cousins; soon they may become elder brothers.
 

1 - Although the generals and admirals have increasingly become involved in political and economic decisions, they have not shed the effects of the military training which has molded their characters and outlook.

 

Yet on the higher levels of their new careers the terms of their success have changed. Examining them closely today, one comes to see that some are not so different from corporation executives as one had first supposed, and that others seem more like politicians of a curious sort than like traditional images of the military.

It has been said that a military man, acting as Secretary of Defense for example, might be more civilian in effect than a civilian who, knowing little of military affairs and personnel, is easily hoodwinked by the generals and admirals who surround him. It might also be felt that the military man in politics does not have a strong-willed, new and decisive line of policy, and even that, in a civilian political world, the general becomes aimless and, in his lack of know-how and purpose, even weak.¹

On the other hand, we must not forget the self-confidence that is instilled by the military training and career: those who are successful in military careers very often gain thereby a confidence which they readily carry over into economic and political realms.

 

Like other men, they are of course open to the advice and moral support of old friends who, in the historical isolation of the military career, are predominantly military. Whatever the case may be with individuals, as a coherent group of men the military is probably the most competent now concerned with national policy; no other group has had the training in coordinated economic, political, and military affairs; no other group has had the continuous experience in the making of decisions; no other group so readily 'internalizes' the skills of other groups nor so readily engages their skills on its own behalf; no other group has such steady access to world-wide information.

 

Moreover, the military definitions of political and economic reality that now generally prevail among the most civilian of politicians cannot be said to weaken the confidence of the warlords, their will to make policy, or their capacity to do so within the higher circles.

The 'politicalization' of the high military that has been going THE POWER ELITE on over the last fifteen years is a rather intricate process: As members of a professional officer corps, some military men develop a vested interest - personal, institutional, ideological - in the enlargement of all things military. As bureaucrats, some are zealous to enlarge their own particular domains. As men of power, some develop quite arrogant, and others quite shrewd, drives to influence, enjoying as a high value the exercise of power.

 

But by no means are all military men prompted by such motives.*

 

 

* "It is drummed into every military manager in the course of his not-inconsiderable education, from the day he enters West Point to the day death makes him eligible for an Arlington burial with honors, that he is to back away from anything resembling a political decision, and that be is to stay well on his side of anything that resembles a line separating his responsibility from civilian authority. Admiral Leahy has written, "1 was so completely lacking in political campaigning experience as to be unable to formulate any opinion. Whereupon the President (F.D.R.) said to me in jest, 'Bill, politically you belong in the Middle Ages.'"' ²

 

 

As a type of man, the professional military are not inherently out for political power, or, at least, one need not rest the case upon any such imputation of motive. For even if they are not desirous of political power, power essentially political in nature may be and has been thrust upon them by civilian default; they have been much used -  willingly or not - by civilians for political purposes.

From the standpoint of the party politician, a well-trained general or admiral is an excellent legitimator of policies, for his careful use often makes it possible to lift the policy 'above politics,' which is to say above political debate and into the realm of administration, where, as statesman Dulles said in support of General Eisenhower for President, there are needed men with the capacity for 'making grave decisions.'³

From the standpoint of the political administrator, military men are often believed useful because they constitute a pool of men trained in executive skills but not openly identified with any private interests.

 

The absence of a genuine Civil Service'** which selects and trains and encourages career men, makes it all the more tempting to draw upon the military.

 

 

** See below, TEN: The Political Directorate.
 

Politicians thus default upon their proper job of debating policy, hiding behind a supposed military expertise; and political administrators default upon their proper job of creating a real civilian career service.

 

Out of both these civilian defaults, the professional military gain ascendancy. It is for such reasons, more than any other, that the military elite - whose members are presumably neither politically appointed nor politically responsible-have been drawn into the higher political decisions.

Once they enter the political arena - willingly, reluctantly, or even unknowingly - they are of course criticized; they become politically controversial and, like any other political actors, they are open to attack. Even when they are not explicitly in politics, the military are attacked politically. In the American context of civilian distrust, the military has always been a handy target of political abuse.

 

But the matter now goes farther than that. In 1953, Senator McCarthy, as Hanson Baldwin put it,

'tried to assume command of the Army and stormed at officers with long and faithful service because they... obeyed the orders of their legitimate superiors.'⁴

Thus he entered, without benefit of induction, the chain of command.

 

The warlord sees how such attacks have virtually destroyed the public respect and the internal morale of the State Department, and he is afraid that his organization, too, will be hollowed out. Moreover, since he holds power to affect economic affairs, having a majority cut of the budget, he is open to attack by new civilian administrative heads who lean on him but also kick him around, as well as by political demagogues who are out to exploit his 'errors' or invent 'errors' for him to commit.

As politics get into the army, the army gets into politics. The military has been and is being made political, on the one hand, by civilian default, and on the other, by civilian criticism of military decisions.

Not always being aware of just what is happening, believing in their mask of 'military expert,' and being used to command, the military often react to criticism in a rather rigid way. In the army book, there is no Standard Operating Procedure for fighting a Senator. There seem only two ways cut: One way, especially if there is a war on, is a field command and obeying orders rigidly without political question. In other words, go soldierly and withdraw, be aloof and stiff in your dignity.

 

The other way is to go all out politically, by the classic ways of forming alliances with political figures, and, given their executive position, maybe some new ways too. For, so long as they remain officers, they cannot very well go explicitly and openly political in the party sense - although some have done so.

 

But, in the main, they will necessarily work carefully and behind the scenes - they will, in short, be open to membership, with other military men, with corporation executives, and with members of the political directorate and of the Congress, to form or to join pro-military cliques on the higher levels.

One must also remember that, by virtue of their training and experience, the professional military believe firmly in the military definition of world reality, and that, accordingly, given the new and enormous means of violence and the nervous default of civilian diplomacy, they are genuinely frightened for their country. Those with the most conviction and, in their terms, ability, will be frustrated by retreat into the role of the strictly apolitical technician of violence.

 

Besides, many are too high up and already too deeply involved for soldierly withdrawal.

It is in terms of this situation that we must understand the political ways of the warlords, and the higher influence military men have now come to exert within the power elite of America. Military men are supposed to be the mere instruments of political men, but the problems they confront increasingly require political decisions. To treat such political decisions as 'military necessities' is of course to surrender civilian responsibility, if not decision, to the military elite.

 

But if the military metaphysics, to which the civilian elite now clings, are accepted, then by definition warfare is the only reality, that is to say, the necessity, of our time.
 

 

2 - As the United States has become a great world power, the military establishment has expanded, and members of its higher echelons have moved directly into diplomatic and political circles.

 

General Mark Clark, for example, who has probably had more political experience while on active duty than any other American warlord, 'believes in what he calls the "buddy system" - a political man and a military man working together,' of which he has said:

'In the past, many American generals were inclined to say of politics: "To hell with it, let's talk politics later." But you can't do it this way any more.'⁵

In 1942, General Clark dealt with Darlan and Giraud in North Africa; then he commanded the Eighth Army in Italy; then he was occupation commander for Austria; and, in 1952, he became US Commander in newly sovereign Japan, as well as head of the US Far East Command and UN Commander in Korea.

 

General George C. Marshall, after being the President's personal representative to China, became Secretary of State (1947-49), then Secretary of Defense (1950-51). Vice Admiral Alan G. Kirk was Ambassador to Belgium in the late 'forties and then to Russia.

 

In 1947, the Assistant Secretary of State for occupied areas was Major General John H. Hildring who dealt 'directly with the military commanders who control the execution of policy in Germany, Austria, Japan and Korea';⁶ Brigadier General Frank T. Hines was Ambassador to Panama; and General Walter Bedell Smith was Ambassador to Russia. General Smith later became the head of the Central Intelligence Agency (1950-53), then Under Secretary of State (1953-54).

 

As occupation commander in Germany, there was General Lucius D. Clay; of Japan, General MacArthur. And no diplomat, but a former Army Chief of Staff, General J. Lawton Collins, went to troubled Indo-China in 1954 'to restore some order' in an area which he said 'had essential political and economic importance for Southeast Asia and the free world.'⁷

Moreover, while still in uniform as well as out of it, high-ranking officers have engaged in policy debate.

 

General Omar Bradley, one of the most articulate deniers of undue military influence in civilian decisions, has appeared before Congressional committees, as well as before broader publics, in support of policies involving economic and political as well as strictly military issues. General Marshall, for example, has submitted arguments against the Wagner-Taft resolution which favored increased immigration to Palestine and its further development as a Jewish homeland.⁸

 

With Generals Bradley, Vandenberg, and Collins, as well as Admiral Sherman, General Marshall has also defended before Congressional committees the Truman administration against Republican attack upon its Far-Eastern policy, and the ousting of General MacArthur from his Far-Eastern command.

General Bradley has made numerous speeches which in their context were readily interpreted, by Senator Taft and Hanson Baldwin among others, as relevant to the political issues of the 1952 Presidential elections.

 

This speech,' wrote Hanson Baldwin,

'helped put General Bradley and the Joint Chiefs of Staff into the political hustings where they have no business to be.' ⁹

Senator Taft, who accused the Joint Chiefs of Staff of being under the control of the political administration and of echoing their policies rather than rendering merely expert advice, was himself supported by General Albert Wedemeyer, as well as by General MacArthur. Another general, Bonner Fellers, was on the Republican National Committee.

In the 1952 election, in direct violation of U.S. Army Regulation 600-10, General MacArthur, in public speeches, attacked the policies of the duly elected administration, delivered the keynote address at the Republican convention, and made it clear that he was open to the Presidential nomination.

 

But another general, Eisenhower, also not retired, was successfully supported for this role. Both of these generals, as well as what might be considered their political policies, were supported by other military men. There is no doubt about it: there are now Republican and Democratic generals. There are also, as we now know well, officers who are for or against individual Senators - such as McCarthy - and who in their military positions lean one way or the other to reveal it or to hide it.

In 1954, a notable array of the high military - headed by retired Lt. General George E. Stratemeyer with retired Rear Admiral John G. Crommelin as Chief of Staff - offered their names in an effort to rally ten million signatures for a McCarthy petition.¹⁰

 

This occurred in the context of the military ascendancy at a time when the words of Old Soldier MacArthur had not faded:

'We of the military shall always do what we are told to do. But if this nation is to survive, we must trust the soldier once our statesmen fail to preserve the peace.' (1953)

 

'I find in existence a new and heretofore unknown and dangerous concept that the members of our armed forces owe primary allegiance and loyalty to those who temporarily exercise the authority of the Executive Branch of government rather than to the country and its Constitution which they are sworn to defend. No proposition could be more dangerous.' (1951)¹¹

But more important perhaps than the straightforward assumption of political roles, the private advice, or the public speeches, is a more complex type of military influence: high military men have become accepted by other members of the political and economic elite, as well as by broad sectors of the public, as authorities on issues that go well beyond what has historically been considered the proper domain of the military.

Since the early 'forties, the traditional Congressional hostility toward the military has been transformed into something of a 'friendly and trusting' subservience.

 

No witness - except of course J. Edgar Hoover - is treated with more deference by Senators than the high military.

'Both in what it did and in what it refused to do,' we read in an official government account, 'the wartime Congress co-operated consistently and almost unquestioningly with the suggestions and the requests from the Chief of Staff.'¹²

And in the coalition strategy, while the President and the Prime Minister 'decided,' theirs were choices approved by the military and made from among alternatives organized and presented by the military.

According to the Constitution, the Congress is supposed to be in charge of the support and governing of the armed might of the nation. During times of peace, prior to World War II, professional politicians in the Congress did argue the details of military life with the military, and made decisions for them, debating strategy and even determining tactics.

 

During World War II, Congressmen 'voted' for such items as the Manhattan Project without having the slightest idea of its presence in the military budget, and when - by rumor - Senator Truman suspected that something big was going on, a word from the Secretary of War was enough to make him drop all inquiry.

 

In the postwar period, the simple fact is that the Congress has had no opportunity to get real information on military matters, much less the skill and time to evaluate it. Behind their 'security' and their 'authority' as experts, the political role of the high military in decisions of basic political and economic relevance has become greatly enlarged.

 

And again, it has been enlarged as much or more because of civilian political default - perhaps necessarily, given the organization and personnel of Congress - than by any military usurpation.¹³
 

 

3 - No area of decision has been more influenced by the warlords and by their military metaphysics than that of foreign policy and international relations.

 

In these zones, the military ascendancy has coincided with other forces that have been making for the downfall of civilian diplomacy as an art, and of the civilian diplomatic service as an organized group of competent people. The military ascendancy and the downfall of diplomacy have occurred precisely when, for the first time in United States history, international issues are truly at the center of the most important national decisions and increasingly relevant to virtually all decisions of consequence.

 

With the elite's acceptance of military definitions of world reality, the professional diplomat, as we have known him or as we might imagine him, has simply lost any effective voice in the higher circles.

Once war was considered the business of soldiers, international relations the concern of diplomats. But now that war has become seemingly total and seemingly permanent, the free sport of kings has become the forced and internecine business of people, and diplomatic codes of honor between nations have collapsed. Peace is no longer serious; only war is serious.

 

Every man and every nation is either friend or foe, and the idea of enmity becomes mechanical, massive, and without genuine passion. When virtually all negotiation aimed at peaceful agreement is likely to be seen as 'appeasement,' if not treason, the active role of the diplomat becomes meaningless; for diplomacy becomes merely a prelude to war or an interlude between wars, and in such a context the diplomat is replaced by the warlord.

Three sets of facts about American diplomacy and American diplomats are relevant to the understanding of what has been happening: the relative weakness of the professional diplomatic service; its further weakening by 'investigation' and 'security' measures; and the ascendancy among those in charge of it of the military metaphysics.

 

1. Only in those settings in which subtle nuances of social life and political intention blend, can 'diplomacy' - which is at once a political function and a social art - be performed. Such an art has seemed to require those social graces usually acquired by persons of upper-class education and style of life. And the career diplomat has, in fact, been representative of the wealthier classes.*

   
   
   * This has been secured by the policy of paying the diplomats such low salaries that they could not exist in a foreign post without private income. Given the social obligations of the diplomatic life, it is almost impossible to live on an ambassadorial salary in any of the major capitals of the world. It was estimated in the early 'forties that it cost an ambassador at an important post from $75,000 to $100,000 a year to entertain in a manner befitting his station; the highest official salary of an ambassador is only $25,000.14
    

   
   But up to 1930, a career in the foreign service had not led to the ambassadorial ranks.** Of the eighty-six men who served as American ambassadors between 1893 and 1930, only about one-fourth of them had held positions in the foreign service prior to their appointment as ambassadors.

    

   The British Ambassador,' D. A. Hartman has pointed out, 'represents the final stage of a definite career in the Foreign Service, while the American ambassadorship is scarcely more than a belated episode in the life of a businessman, politician, or lawyer.'¹⁶

    

    

   * * None of the 18 top ambassadors of 1899 could be termed 'careermen' in the sense that they had spent most of their adult lives working in the Foreign Service. Ten of them had never held a diplomatic post before becoming ambassadors; and another six had been in diplomatic service for not longer than nine years before 1899. Only two had started in the diplomatic service longer than a decade before: Oscar S. Straus, Ambassador to Turkey, and Andrew D. White, Ambassador to Germany. Most of these ambassadors seem to have acquired their appointments as a reward for party faithfulness: eleven had been active in politics, about half of these in conjunction with legal careers. There was one professor and one journalist; and the remaining five men were businessmen, often again in conjunction with a law career. As a group the ambassadors of 1899 came from comfortable families, often of great wealth, were educated in the best schools of America and Europe - six of them graduating from Ivy League schools - and had held important positions in business or politics.¹⁵
    

   
   During the long Democratic tenure something like a career service, based upon upper-class recruitment, had been developed. Of the thirty-two ambassadors and top ministers of 1942, almost half were graduates of private preparatory schools frequented by the children of the metropolitan 400; and of the top one hundred and eighteen officers in the Foreign Service, fifty-one were Harvard, Princeton or Yale.¹⁷
   
   When the Republicans assumed office in 1953, there were 1,305 Foreign Service officers (out of a total State Department of 19,405) serving the seventy-two diplomatic missions and one hundred ninety-eight consular offices of the United States.¹⁸

    

   Forty of the seventy-two chiefs of United States missions abroad had been career diplomats 'whose appointments to particular posts may have been by the President but whose tenure in the foreign service is unaffected by the change in administration.'19 There were two alternatives open to the career men - they could retire, or they could resign from their posts and become available for other assignments under the new administration.
   
   By this time it would seem that a foreign-service career leading up to an ambassadorship had become more firmly entrenched, since nineteen of the top twenty-five ambassadors appointed by President Eisenhower were career men.

    

   But it might also be said that by 1953 it was no longer an 'honor' to a prominent businessman, lawyer, or politician to be appointed as the ambassador to the generally small countries in which almost all of these career men served.20 However, later in his administration, President Eisenhower began to appoint unsuccessful politicians and political helpmates to the smaller countries hitherto reserved for career men. Thus in Madrid, John D. Lodge - defeated for governor of Connecticut - replaced the veteran diplomat James C. Dunn.

    

   In Libya, John L. Tappin - ski expert and chief of a division of 'Citizens for Eisenhower' - replaced career-man Henry S. Villard.21 In the more coveted diplomatic posts, representing America were millionaire bankers; members, relatives, and advisers of the very rich; high corporate lawyers; the husbands of heiresses.
   
    

2. Even before the change of administration, the morale and competence of the career service had been severely weakened by investigation and dismissal of personnel.

    

   Then Senator McCarthy's associate, Scott McLeod, moved from the FBI to the head of both security and personnel in the Department of State. Mr. McLeod, who 'believes that "security" is a basic criterion of diplomacy,' has remarked that after checking all other qualifications, he asks himself: 'How would I like him to be behind a tree with me in a gunfight? You get pretty high standards if you think along such lines. And that's the way I like to think in these investigations.'²²

    

   There were many men who 'wouldn't fit behind a tree' with policeman McLeod, and among many Foreign Service officers who still held their positions 'the impression grew that it wasn't safe to report the truth to Washington about any foreign situation when the truth didn't jibe with the preconceived notions of the people in Washington.'* ²³

    

    

   * This was not, of course, an entirely new feature of the Foreign Service. For instance: 'The basic burden of the reporting of the China Service in the critical years was that, in the inevitable clash between the Chinese Communists and Chiang Kai-shek, Chiang would be the loser. This correctness in judgment has resulted, however, not in honor either collectively or individually to the China Service. China has gone Communist. In some fashion the men of the China Service were held responsible. The China Service, therefore, no longer exists. Of the twenty-two officers who joined it before the beginning of World War II, there were in 1952 only two still used by the State Department in Washington... Most of the rest were still serving the American government, but not... where their intimate knowledge of a China with whom we were desperately at war in Korea might be useful.'24
    

   
   Following a long list of men already dismissed for reasons of loyalty,' in the fall of 1954, a career diplomat of twenty-three years service, John Paton Davies, was dismissed not on the grounds of loyalty, but because of 'lack of judgment, discretion and reliability'; his opinions on China policy ten years previously not jibing with the current administration policy.²⁵ The comments on this case by career men expressed their state of mind.

    

   A recent member of the Policy Planning Staff of the State Department wrote:

   'One hopes that the American public will see at last that the word "security" has become a euphemism. It covers the primitive political drive of the last five years to eliminate intellectual and moral distinction from the Government service, and to staff the Government instead with political good fellows who cannot be suspected of superiority.

    

   Under the reorganized Foreign Service, for example, educational standards for admission are being avowedly lowered. It is as if the mediocrity of the mindless has become the ideal.'²⁶

    

   George Kennan, a veteran diplomat and a distinguished student of foreign affairs, has advised a class of students at Princeton not to choose the foreign service as a career. In other words: 'the morale of the State Department is so broken that its finest men flee from it, and advise others to flee.'²⁷

    

3. For years of course the military attaches have been at their foreign posts, where they are supposedly the Ambassador's aides as well as a link in an intelligence service; but 'many of them, in the post-war years, have viewed the Foreign Service and State Department with ill-disguised contempt and made themselves virtually independent of the Ambassadors under whom they should work.'*

    

    

   * In April 1954, the army prohibited officers abroad from keeping diaries, after the world discovered that Major General Grow, military attaché to Moscow, had kept a diary in which he advocated war against the Soviet Union, expressed his distaste for the ambassador and his dislike for his contacts. While visiting Frankfurt, Germany, he left the diary in a hotel room, from which it was promptly stolen, photographed, and returned. The Soviet Union made propaganda. The general, clearly an unfortunate type for intelligence work, is perhaps less to be blamed than the 'spoils system' of the army intelligence system by which he was placed in Moscow. General Grow is not lonely in his incompetence. The most important attaché post in the postwar period was filled by a general - Iron Mike O'Daniel - whose two-fisted fighting style often seemed his only recommendation. Two attaches in eastern Europe after the war 'were notorious, one for his convivial habits, the other for selling on the black market some excess clothing he had bought.' Another general - head of G2 during the war, was recalled from London for investigation of black-market charges.28
    

   
   The problem, however, goes well beyond such relatively low-order tension.

    

   The military, as we have seen, have become ambassadors as well as special envoys. In many of the major international decisions, the professional diplomats have simply been by-passed, and matters decided by cliques of the high military and political personnel. In the defense agreements signed by the United States and Spain in September of 1953, as in the disposition in 1945 and 1946 of the western Pacific islands captured from the Japanese, the military has set policy of diplomatic relevance without or against the advice of the diplomats.²⁹

    

   The Japanese peace treaty was not arranged by diplomats but by generals; a peace treaty with Germany has not been made: there have only been alliances and agreements between armies.

    

   At Panmunjom, the end of the Korean war was 'negotiated' not by a diplomat but by a General in open collar and without necktie.

   'The American services,' writes the London Economist, 'have successfully implanted the idea that there are such things as purely military factors and that questions which involve them cannot be adequately assessed by a civilian. British theory and experience denies both these propositions...'³⁰

   So Admiral Radford, who has told a Congressional Committee that Red China had to be destroyed even if it required a fifty-year war, argued, as chairman of the Joint Chiefs of Staff, for the use of 500 planes to drop tactical A-bombs on Vietminh troops before the fall of Dienbienphu.

    

   If China openly came into the picture, we are unofficially told, Peking was to be given atomic treatment.31 This political situation was defined by him as military, and as such argued for with a voice as loud as those of his civilian bosses, the Secretary of Defense and the Secretary of State. In August 1954, General Mark Clark publicly stated that Russia should be ejected from the United Nations, and diplomatic relations with her broken off.

    

   General Eisenhower, then President, disagreed with his intimate friend, but the President's word did not stop General James A. Van Fleet from publicly subscribing to General Clark's views.⁸² Not that it was too important an issue, for the UN has regularly been by-passed in important decisions and conclaves.

    

   The UN did not organize the Geneva conference; the UN did not consider the United States action in Guatemala.88 The by-passing of the UN in the most important East-West conflicts and its general political weakening is one aspect of the downfall of diplomacy in the postwar period. The other aspect is the military ascendancy, as personnel and as metaphysics.
   
   In America, diplomacy has never been successfully cultivated as a learned art by trained and capable professionals, and those who have taken it up have not been able to look forward to obtaining the top diplomatic posts available, for these have been largely bestowed according to the dictates of politics and business. Such professional diplomatic corps as the United States has possessed, along with the chances to build up such a corps in the future, have been sabotaged by recent investigation and dismissal.

    

   And, in the meantime, the military has been and is moving into the higher councils of diplomacy.

 

4 - The military establishment has, of course, long been economically relevant.

 

The Corps of Engineers - historically the elite of the West Pointers - has in peacetime controlled rivers and harbor construction. Local economic, as well as Congressional, interests have not been unaware of the pork-barrel possibilities, nor of the chance to have The Corps disapprove of the Reclamation Bureau's plans for multiple-purpose development of river valleys. 'Actually' - we are told by Arthur Maass in his discussion of 'the lobby that can't be licked' - 'up to about 1925, the Corps disbursed 12 per cent of the total ordinary expeditures of the government' ³⁴

But now the economic relevance of the military establishment is on a qualitatively different scale.*

 

 

* Between 1789 and 1917, the U.S. government spent about 29 1/2 billion dollars; but in the single fiscal year of 1952, the military alone was allotted 40 billion. In 1913, the cost per capita of the military establishment was $2.25; in 1952, it was almost $250.35

 

 

The national budget has increased, and within it the percentage spent by and for the military. Since just before World War II, the percentage has never gone below about 30 per cent, and it has averaged over 50 per cent, of the entire government budget. In fact, two out of every three dollars in the budget announced in 1955 was marked for military security.³⁶

 

And as the role of government in the economy has increased, so has the role of the military in the government.

We should constantly keep in mind how recent the military ascendancy is. During World War I the military entered the higher economic and political circles only temporarily, for the 'emergency'; it was not until World War II that they intervened in a truly decisive way.

 

Given the nature of modern warfare, they had to do so whether they wanted to or not, just as they had to invite men of economic power into the military. For unless the military sat in on corporate decisions, they could not be sure that their programs would be carried out; and unless the corporation chieftains knew something of the war plans, they could not plan war production.

 

Thus, generals advised corporation presidents and corporation presidents advised generals. 'My first act on becoming Chief of Ordnance of June 1, 1942,' Lt. General Levin H. Campbell, Jr., has said, 'was to establish a personal advisory staff consisting of four outstanding business and industrial leaders who were thoroughly familiar with all phases of mass production.'³⁷

During World War II, the merger of the corporate economy and the military bureaucracy came into its present-day significance. The very scale of the 'services of supply' could not but be economically decisive: The Services of Supply, Fortune remarked in 1942, 'might... be likened to a holding company of no mean proportions.

In fact - charged with spending this year some $32 billion, or 42 per cent of all that the U.S. will spend for war - it makes U.S. Steel look like a fly-by-night, the A.T. and T. like a country-hotel switchboard, Jesse Jones's RFC or any other government agency like a small-town boondoggle. In all of Washington, indeed, there is scarcely a door - from Harry Hopkins's Munitions Assignments Board on down - in which [General] Somervell or his lieutenants have not come to beg, to borrow, or to steal.'³⁸

 

The very organization of the economics of war made for the coincidence of interest and the political mingling among economic and military chiefs:

'The Chief of Ordnance has an advisory staff composed of Bernard M. Baruch, Lewis H. Brown of Johns-Manville Corp., K. T. Keller of Chrysler Corp., and Benjamin F. Fairless of United States Steel Corp. Ordnance contracts are placed by four main branches... Each branch director... [is] assisted by an advisory industrial group, composed of representatives of the major producers of weapons in which the branch deals.' ³⁹

The military establishment and the corporations were of course formally under the control of civilian politicians. As managers of the largest corporate body in America,

'the military had a board of directors ... the President, the service Secretaries, the men on the military-affairs committees of Congress. Yet many of the men on the board, i.e., the Congressmen, can really do little more than express general confidence, or the lack of it, in the management. Even the most influential directors, the President and the Secretary of Defense, can usually argue with the management only as laymen arguing with professionals - a significantly different relationship from that of board and management in industry.'⁴⁰

The coming together of the corporations and the military was most dramatically revealed in their agreement upon the timing and the rules of 'reconversion.'

 

The military might lose power; the corporations would no longer produce under the prime contracts they held; reconversion, if not handled carefully, could easily disturb the patterns of monopoly prevailing before war production began. The generals and the dollar-a-year executives saw to it that this did not happen.⁴¹

After World War II, military demands continued to shape and to pace the corporate economy. It is accordingly not surprising that during the last decade, many generals and admirals, instead of merely retiring, have become members of boards of directors.*

 

 

* General Lucius D. Clay, who commanded troops in Germany, then entered the political realm as occupation commander, is now the board chairman of the Continental Can Company. General James H. Doolittle, head of the 8th Air Force shortly before Japan's surrender, is now a vice-president of Shell Oil. General Omar N. Bradley, who commanded the 12th Army group before Berlin, going on to high staff position, then became the board chairman of Bulova Research Laboratories; in February 1955, Chairman Bradley allowed his name to be used - 'General of the Army Omar N. Bradley' - on a full-page advertisement in support, on grounds of military necessity, of the new tariff imposed on Swiss watch movements. General Douglas MacArthur, political general in Japan and Korea is now chairman of the board at Remington Rand, Inc. General Albert C. Wedemeyer, commander of U.S. forces in the China theater, is now a vice-president of AVCO Corporation. Admiral Ben Moreell is now chairman of Jones & Laughlin Steel Corp. General Jacob Evers is now technical adviser to Fairchild Aircraft Corp. General Ira Eaker is vice-president of Hughes Tool Co. General Brehon Somervell, once in charge of army procurement, became, before his death in 1955, chairman and president of Koppers Co. Admiral Alan G. Kirk, after serving as Ambassador to Russia, became chairman of the board and chief executive officer of Mercast, Inc., which specializes in high-precision metallurgy. General Leslie R. Groves, head of the Manhattan Project, is now a vice-president of Remington Rand in charge of advanced research; General E. R. Quesada, of the H-Bomb test, is a vice-president of Lockheed Aircraft Corporation; General Walter Bedell Smith is now vice-chairman of American Machine and Foundry Company's board of directors; Army Chief of Staff General Matthew B. Ridgway, having apparently turned down the command of Kaiser's automotive invasion of Argentina, became chairman of the board of the Mellon Institute of Industrial Research.42

 

 

It is difficult to avoid the inference that the warlords, in their trade of fame for fortune, are found useful by the corporate executives more because of whom they know in the military and what they know of its rules and ways than because of what they know of finance and industry proper.

 

Given the major contracts that are made by the military with private corporations, we can readily understand why business journalists openly state:

'McNamey knows Convair's best customer, The Pentagon, as few others do -  a fact well known to his friend, Floyd Odium, Convair chairman.' And 'in business circles the word has gone out: Get yourself a general. What branch of the government spends the most money? The military. Who, even more than a five-per-center, is an expert on red tape? A general or an admiral. So make him Chairman of the Board.' ⁴³

The increased personnel traffic that goes on between the military and the corporate realms, however, is more important as one clue to a structural fact about the United States than as an expeditious means of handling war contracts.

 

Back of this shift at the top, and behind the increased military budget upon which it rests, there lies the great structural shift of modern American capitalism toward a permanent war economy.

Within the span of one generation, America has become the leading industrial society of the world, and at the same time one of the leading military states. The younger military are of course growing up in the atmosphere of the economic-military alliance, but more than that they are being intensively and explicitly educated to carry it on.

 

'The Industrial College of the Armed Forces,' concerned with the interdependence of economy and warfare, is at the top level of the military educational system.⁴⁴

To the optimistic liberal of the nineteenth century all this would appear a most paradoxical fact. Most representatives of liberalism at that time assumed that the growth of industrialism would quickly relegate militarism to a very minor role in modern affairs. Under the amiable canons of the industrial society, the heroic violence of the military state would simply disappear. Did not the rise of industrialism and the long era of nineteenth-century peace reveal as much?

 

But the classic liberal expectation of men like Herbert Spencer has proved quite mistaken. What the main drift of the twentieth century has revealed is that as the economy has become concentrated and incorporated into great hierarchies, the military has become enlarged and decisive to the shape of the entire economic structure; and, moreover, the economic and the military have become structurally and deeply interrelated, as the economy has become a seemingly permanent war economy; and military men and policies have increasingly penetrated the corporate economy.*

 

*For a fuller discussion of these trends, see below, TWELVE: The Power Elite.

'What officials fear more than dateless war in Korea,' Arthur Krock reported in April of 1953, 'is peace... The vision of peace which could lure the free world into letting down its guard, and demolishing the slow and costly process of building collective security in western Europe while the Soviets maintained and increased their military power, is enough to make men in office indecisive.

 

And the stock market selling that followed the sudden conciliatory overtures from the Kremlin supports the thesis that immediate prosperity in this country is linked to a war economy and suggests desperate economic problems that may arise on the home front.'⁴⁶

 

 

5 - Scientific and technological development, once seated in the economy, has increasingly become part of the military order, which is now the largest single supporter and director of scientific research in fact, as large, dollar-wise, as all other American research put together.

 

Since World War II, the general direction of pure scientific research has been set by military considerations, its major finances are from military funds, and very few of those engaged in basic scientific research are not working under military direction. The United States has never been a leader in basic research, which it has imported from Europe. Just before World War II, some $40 million - the bulk of it from industry - was spent for basic scientific research; but $227 million was spent on applied research and 'product development and engineering.'⁴⁶

 

With the Second World War pure scientists were busy, but not in basic research. The atom program, by the time it became governmental, was for the most part an engineering problem. But such technological developments made it clear that the nations of the world were entering a scientific, as well as an armaments, race. In the lack of any political policies for science, the military, first the navy, then the army, began to move into the field of scientific direction and support, both pure and applied.

 

Their encroachment was invited or allowed by corporate officials who preferred military rather than civilian control of governmental endeavors in science, out of fear of 'ideological' views of civilians concerning such things as patents. By 1954, the government was spending about $2 billion on research (twenty times the prewar rate); and 85 per cent of it was for 'national security.'⁴⁷

 

In private industry and in the larger universities, the support of pure science is now dominantly a military support. Some universities, in fact, are financial branches of the military establishment, receiving three or four times as much money from military as from all other sources combined. During the war, four leading institutions of learning received a total of more than $200 million in research contracts - not including atom research, for which exact figures are lacking.

The general tendency for the militarization of science has continued into the years of peace. That fact, as The National Science Foundation has made clear, is responsible for the relative neglect of 'fundamental science.' Out of the $2 billion scientific budget of 1955, only $120 million (6 per cent) was for basic research, but, as we have said, 85 per cent was for military technology.⁴⁸

The military ascendancy in the world of science is more dramatically revealed by the troubled atmosphere which the military's 'risk system' has brought about.

 

By October of 1954, this had reached the point at which Dr. Vannevar Bush - World War II Chief of the Office of Scientific Research and Development - felt it necessary to assert flatly that the scientific community was 'demoralized.'

'You won't find any strikes...' he said, 'but scientists today are discouraged and downhearted and feel that they are being pushed out, and they are.'⁴⁹

In the context of distrust, no less a scientist than Albert Einstein publicly asserted:

'If I would be a young man again and had to decide how to make my living, I would not try to become a scientist or scholar or teacher. I would rather choose to be a plumber or a peddler in the hope to find that modest degree of independence still available under present circumstances.'⁶⁰

Although there are perhaps 600,000 engineers and scientists in the United States, only some 125,000 of them are active in research, and of these perhaps 75,000 are researching for industry in its pursuit of new commercial products, and another 40,000 are in developmental engineering.

 

There are only 10,000 scientists engaged in fundamental research in all branches, and informed opinion has it that the top-rate creators number no more than one or two thousand.51

It is these senior circles that have become deeply involved in the politics of military decisions, and the militarization of political life. In the last fifteen years, they have moved into the vacuum of theoretical military studies, in which strategy and policy become virtually one.

 

It is a vacuum because, historically - as Theodore H. White has pointed out - the American warlords have not concerned themselves with it, being more engaged in 'technique' than 'theory.' Accordingly, as part of the military ascendancy, there is the felt need of the warlords for theory, the militarization of science, and the present 'demoralization' of the scientist in the service of the warlord.⁵²

In educational institutions the pursuit of knowledge has been linked with the training of men to enact special roles in all areas of modern society. The military, in addition to their own schools, have used and increasingly use the educational faculties of private and public educational institutions.*

 

 

* During the Civil War, land grant colleges were set up in various states, which included in their curricula military training. In some of these colleges, between that war and World War I, this training was voluntary; in others, compulsory for various periods of the college career. In 1916, the War Department standardized military training as compulsory for the first two years in the land grant colleges. But in 1923, the Wisconsin legislature successfully challenged this arrangement for its University, a land grant institution, and several other schools followed suit. During World War I, Reserve Officers Training Corps units were established in various colleges. These ROTC programs have been expanded on the campuses of colleges and universities. Universal military training - steadily pressed for by the military - would, of course, mean the processing of all young men in military skills and appropriate attitudes, for a period half as long and probably twice as intensive as a four-year college course.

 

 

As of 1953, almost 40 per cent of the male students of 372 colleges and universities were enrolled in officer-training programs of army, navy or air force.

 

The liberal arts institutions involved were devoting about 16 per cent of their curriculum to the military courses. For the nation as a whole, about one out of five students were in ROTC units, an unprecedented proportion for a year of formal peace.⁵³

During World War II, the military had begun to use the colleges and universities for specialist training, as well as for the military training of students in accelerated courses. And the specialist training, as well as the heavy research programs, has continued after the war.

Today, many colleges and universities are eager to have military programs of training and research established on their campuses. It is prestigious and it is financially sound. Moreover, the list of military men who, most of them without any specific educational qualifications, have come to serve as college administrators, and in other educational capacities, is impressive.

 

General Eisenhower, of course, on his way to the Presidency, was the head of Columbia University, as well as a member of the National Educational Association Policy Commission.

 

And even a casual survey reveals a dozen or so military men in educational positions.*

 

 

* For example, Rear Admiral Herbert J. Grassie, chancellor of Lewis College of Science and Technology; Admiral Chester Nimitz, regent of the University of California at Berkeley; Major General Frank Keating, a member of the Ithaca College board of trustees; Rear Admiral Oswald Colcough, dean of the George Washington University Law School; Colonel Melvin A. Casburg, dean of the St. Louis School of Medicine; Admiral Charles M. Cook, Jr., a member of the California State Board of Education.54

 

 

There has been a good deal of tension between the schools and the military.

 

In the case of the Armed Forces Institute - a correspondence school for men in the service - one clause in the contract with universities gives the military direct power over university personnel, in case they are 'disapproved' by the government: as of August 1953, twenty-eight universities had signed, fourteen had rejected, and five were pending.⁵⁵

 

But in general, the acceptance by the educators of the military has been accomplished without such misunderstandings; it has been accomplished during the war and after it, because many schools need financial support; the federal government has not provided it under civilian control, but the military has had it to provide.
 

 

6 - It is not only within the higher political and economic, scientific and educational circles that the military ascendancy is apparent. The warlords, along with fellow travelers and spokesmen, are attempting to plant their metaphysics firmly among the population at large.

During World War II, sympathizers of the warlords came out into the open as spokesmen for militarism. The wartime speeches of Mr. Frank Knox, of Mr. Charles E. Wilson (G.E.), and of James Forrestal - for example - were rich in military images of the future held by key men of power, and the images have by no means faded.

 

Since World War II, in fact, the warlords have caused a large-scale and intensive public-relations program to be carried out. They have spent millions of dollars and they have employed thousands of skilled publicists, in and out of uniform, in order to sell their ideas and themselves to the public and to the Congress.

The content of this great effort reveals its fundamental purpose: to define the reality of international relations in a military way, to portray the armed forces in a manner attractive to civilians, and thus to emphasize the need for the expansion of military facilities. The aim is to build the prestige of the military establishment and to create respect for its personnel, and thus to prepare the public for military-approved policies, and to make Congress ready and willing to pay for them.

 

There is also, of course, the intention of readying the public for the advent of war.

To achieve these ends, the warlords of Washington have at hand extensive means of communication and public relations. Daily, in war and in peace, they release items and stories to the press and to the three or four dozen newsmen housed in the newsroom of the Pentagon. They prepare scripts, make recordings, and take pictures for radio and TV outlets; they maintain the largest motion-picture studio in the East, bought from Paramount in 1942.

 

They are ready to serve magazine editors with prepared copy. They arrange speaking engagements for military personnel and provide the speeches. They establish liaison with important national organizations, and arrange orientation conferences and field trips for their leaders, as well as for executives and key people in the business, the educational, the religious, the entertainment worlds.

 

They have arranged, in some 600 communities, 'advisory committees' which open the way to their messages and advise them of unfavorable reactions.⁶⁶

Everything that appears in the news or on the air that concerns the military is summarized and analyzed; and everything which they release, including the writing of retired warlords, is reviewed and censored.

The cost of this program varies from year to year, but interested Senators have estimated it as between $5 million and $12 million. Such estimates, however, mean little, for the position of the military is such that they were able to enjoy, during one twelve

month period, some $30 million worth of motion pictures, which they co-operated in producing; obtain millions of dollars worth of free time on TV, and, according to Variety's estimate, about $6 million of free radio time.

Nor does the 1951 estimate of Senator Harry F. Byrd (of 2,235 military and 787 civilians in publicity, advertising, and public relations ) accurately reveal the scale of the program. For it is not difficult to use, at least part-time, many service personnel for public-relations purposes. Top admirals and generals, of course, have their own public-relations men.

 

In 1948, General MacArthur's command included one hundred thirty-five army men and forty civilians assigned to publicity. Eisenhower, when Chief of Staff, had forty-four military and one hundred thirteen civilians.⁵⁷ And the warlords themselves have been learning the ways of publicity.

 

Recently the retiring Air Force Chief of Staff, General Hoyt S. Vandenberg, told graduates at an air force base that

'the greatest fraternity on the face of the earth are the people who wear wings... You're not just jet jockeys... Take up the broader duty of understanding and preaching the role of air power... The people who won't face the truth... must be told repeatedly, earnestly, logically that air power will save the world from destruction...' ⁶⁸

It is a delicate problem which the military publicists confront, but there is one great fact that works entirely for their success: in all of pluralist America, there is no interest - there is no possible combination of interests - that has anywhere near the time, the money, the manpower, to present a point of view on the issues involved that can effectively compete with the views presented day in and day out by the warlords and by those whom they employ.⁵⁹

This means, for one thing, that there is no free and wide debate of military policy or of policies of military relevance.

 

But that, of course, is in line with the professional soldier's training for command and obedience, and with his ethos, which is certainly not that of a debating society in which decisions are put to a vote. It is also in line with the tendency in a mass society for manipulation to replace explicitly debated authority, as well as with the fact of total war in which the distinction between soldier and civilian is obliterated.

 

The military manipulation of civilian opinion and the military invasion of the civilian mind are now important ways in which the power of the warlords is steadily exerted.

The extent of the military publicity, and the absence of opposition to it, also means that it is not merely this proposal or that point of view that is being pushed. In the absence of contrasting views, the very highest form of propaganda warfare can be fought: the propaganda for a definition of reality within which only certain limited viewpoints are possible. What is being promulgated and reinforced is the military metaphysics - the cast of mind that defines international reality as basically military.

 

The publicists of the military ascendancy need not really work to indoctrinate with this metaphysics those who count: they have already accepted it.

 

7 - In contrast with the existence of military men, conceived simply as experts in organizing and using violence, 'militarism' has been defined as 'a case of the dominance of means over ends' for the purpose of heightening the prestige and increasing the power of the military.⁶⁰

 

This is, of course, a conception from the standpoint of the civilian who would consider the military as strictly a means for civilian political ends. As a definition, it points to the tendency of military men not to remain means, but to pursue ends of their own, and to turn other institutional areas into means for accomplishing them.

Without an industrial economy, the modern army, as in America, could not exist; it is an army of machines. Professional economists usually consider military institutions as parasitic upon the means of production. Now, however, such institutions have come to shape much of the economic life of the United States.

 

Religion, virtually without fail, provides the army at war with its blessings, and recruits from among its officials the chaplain, who in military costume counsels and consoles and stiffens the morale of men at war. By constitutional definition, the military is subordinated to political authority, and is generally considered, and has generally been, a servant as well as an adviser of civilian politicians; but the warlord is moving into these circles, and by his definitions of reality, influencing their decisions.

 

The family provides the army and navy with the best men and boys that it possesses. And, as we have seen, education and science too are becoming means to the ends sought by the military.

The military pursuit of status, in itself, is no threat of military dominance. In fact, well enclosed in the standing army, such status is a sort of pay-off for the military relinquishment of adventures in political power. So long as this pursuit of status is confined to the military hierarchy itself, it is an important feature of military discipline, and no doubt a major source of much military gratification.

 

It becomes a threat, and it is an indication of the growing power of the military elite today, when it is claimed outside the military hierarchy and when it tends to become a basis of military policy.

The key to an understanding of status is power. The military cannot successfully claim status among civilians if they do not have, or are not thought to have power. Now power, as well as images of it, are always relative: one man's powers are another man's weaknesses. And the powers that have weakened the status of the military in America have been the powers of money and of money-makers, and the powers of the civilian politicians over the military establishment.

American 'militarism,' accordingly, involves the attempt of military men to increase their powers, and hence their status, in comparison with businessmen and politicians.

 

To gain such powers they must not be considered a mere means to be used by politicians and money-makers. They must not be considered parasites on the economy and under the supervision of those who are often called in military circles 'the dirty politicians.'

 

On the contrary, their ends must be identified with the ends as well as the honor of the nation; the economy must be their servant; politics an instrument by which, in the name of the state, the family, and God, they manage the nation in modern war.

'What does it mean to go to war?' Woodrow Wilson was asked in 1917.

 

'It means,' he replied, 'an attempt to reconstruct a peacetime civilization with war standards, and at the end of the war there will be no bystanders with sufficient peace standards left to work with. There will be only war standards .. .'61

American militarism, in fully developed form, would mean the triumph in all areas of life of the military metaphysic, and hence the subordination to it of all other ways of life.

There can be little doubt but that, over the last decade, the war lords of Washington, with their friends in the political directorate and the corporate elite, have definitely revealed militaristic tendencies. Is there, then, in the higher circles of America 'a military clique'? Those who argue about such a notion - as Supreme Court Justice William O. Douglas and General of the Army Omar Bradley have recently done⁶³ - are usually arguing only about the increased influence of the professional military.

 

That is why their arguments, in so far as they bear upon the structure of the elite, are not very definitive and are usually at cross-purposes. For when it is fully understood, the idea of a military clique involves more than the military ascendancy. It involves a coincidence of interests and a co-ordination of aims among economic and political as well as military actors.

Our answer to the question, 'Is there now a military clique?' is: Yes, there is a military clique, but it is more accurately termed the power elite, for it is composed of economic, political, as well as military, men whose interests have increasingly coincided. In order to understand the role of the military within this power elite, we must understand the role of the corporation executive and the politician within it.

 

And we must also understand something of what has been happening in the political sphere of America.

Back to Contents

 

 

 

 

10 - The Political Directorate

THE perfect candidate for the Presidency of the United States was born some fifty-four years ago in a modest but ramshackled farm house in the pivotal state of Ohio.

 

Of a sizable family, which arrived from England shortly after the Mayflower, he grew up on the farm, performing the traditional chores and thus becoming well acquainted with all farm problems. When he was in high school his father died, the farm was sold, his strong and sensible mother moved the family to a near-by small town, and the struggle began.

The future President worked in his uncle's factory, quickly becoming a practical expert on all labor and management problems, while putting himself through college. He arrived in France during World War I just in time to make clear, for a full six months, that, in another war with more time, he would undoubtedly be a statesman of note.

 

Returning home, he went to the state law school for two years, married his high-school sweetheart, whose grandfathers fought with the Confederate armies, opened his office, and joined the local party club, as well as the Elks, and in due course the Rotary Club, and attended the Episcopalian church. He is having a very busy life now, but he can stand such strains, for it is as if his constitution was built for them.

 

During the 'twenties, he represented a group of small factories in their relations with labor, and was so successful that during the 'thirties there was no labor trouble of any consequence. Other companies, noting this as a remarkable fact, also engaged him, and thus, with the publicity, he became mayor of his city in 1935.

As the soldier-statesman and labor-relations expert took hold of the reins, both business and labor acclaimed the skill and vigor of his administration. Although an absolutely regular party man, he remodeled the city government from top to bottom. Came the Second World War, and despite his two young sons, he resigned his mayoralty to become a lieutenant colonel, and a member of a favored general's staff.

 

He quickly became a statesman well versed in Asiatic and European affairs and confidently predicted everything that happened.

A brigadier general, he returned to Ohio after the war and found himself the overwhelming choice for governor. For two terms he has been swept into office, his administration being as efficient as any business, as moral as any church, as warm-hearted as any family. His face is as honest as any business executive's, his manner as sincere as any salesman's; in fact, he is something of both, with a touch of grimness and homely geniality all his own.

 

And all of this comes through, magnetically, straight to you, through the lens of any camera and the microphone as well.¹
 

1 - Some of the features of this portrait are not too different from the average modern President's to be recognizable, although perhaps their interpretation is somewhat unmeasured.

 

Among those who have reached the top positions of the American government one can find at least two or three who represent almost anything for which one looks. One could endlessly collect biographical anecdotes and colorful images about them - but these would not add up to any conclusions about the leading types of men and their usual careers.

 

We must understand how history and biography have interplayed to shape the course of American politics, for every epoch selects and forms its own representative political men - as well as prevailing images of them.

That is the first point to bear in mind: many of the images of politicians that prevail today are, in fact, drawn from earlier epochs. Accordingly, 'The American Politician' is seen as a valuable originator but also a cheap tool, a high statesman but also a dirty politician, a public servant but also a sly conniver. Our view is not clear because, as with most of our views of those above us, we tend to understand our own time in accordance with the confused stereotypes of previous periods.

The classic commentaries of American politics - those of Tocqueville, Bryce, and Ostrogorski - rest upon nineteenth-century experience - generally from Andrew Jackson to Theodore Roosevelt. It is, of course, true that many of the trends that determined the political shape of the long middle period are still at work influencing the type of politician that prevails in our own political times - especially on the middle levels of power, in the Congress.

 

But during the twentieth century, and especially after the First World War, other forces have greatly modified the content and the importance in America of political institutions. The political establishment of the United States has become more tightly knit, it has been enlarged in scope, and has come up closer to virtually all of the social institutions which it frames.

 

Increasingly, crises have arisen that have not seemed resolvable on the old local and decentralized basis; increasingly those involved in these crises have looked to the state to resolve them. As these changes in the shape and practice of the state have increased the power available to those who would gain power and exert it through political institutions, new types of political men have become ascendant.

The higher politicians do not constitute any one psychological type; they cannot be sorted out and understood in terms of any standard set of motives. Like men of other pursuits, politicians, high or low, are sometimes driven by technological love of their activities - of the campaigning and the conniving and the holding of office; more frequently than others, they are drawn to politics by the prestige that their success brings to them; in fact, 'power for power's sake' - a very complicated set of motives - usually involves the feeling of prestige which the exercise of power bestows.²

 

Rarely is it the money they receive as officeholders which attracts them.

The only general meaning we can give to 'The Politician' is the man who more or less regularly enacts a role in political institutions and thinks of it as at least among his major activities. Accordingly, since there are two major kinds of political institutions in the United States, there are two major types of 'politicians.'

The party politician's working career is spent inside a specific kind of political organization: he is a party man. There is also the political professional whose career has been spent in the administrative areas of government, and who becomes 'political' to the extent that he rises above the civil-service routine and into the policy-making levels. In the pure type, such a politician is an ex-bureaucrat.

As types, party politicians and political bureaucrats are the professionals of modern government, if only in the sense that their careers are spent mainly within the political orbit. But not all men who are in politics are professional politicians either in the party sense or in the bureaucratic sense: in fact, today the men at the political top are much less likely to be bureaucrats, and rather less likely to be party politicians than political outsiders.

The political outsider is a man who has spent the major part of his working life outside strictly political organizations, and who -  as the case may be - is brought into them, or who forces his way in, or who comes and goes in the political order. He is occupationally formed by nonpolitical experience, his career and his connections have been in other than political circles, and as a psychological type, he is anchored in other institutional areas.

 

In fact, he is usually considered by the professionals as a representative or as an agent within the government of some non-governmental interest or group.

 

The political outsider is by no means confined to the Republican party. Under the Democrats, he is more likely to be on the make, striving to become acceptable to the corporate chieftains; whereas, under the Republicans, he is more usually a man already acceptable and therefore surer of himself and of how his decisions will be interpreted by those who count. A further consequence is that under the Republicans he can be less hypocritical.

Such outsiders, of course, may become bureaucratic experts by spending much time in administrative work, and thus linking their careers and their expectations to government; they may become party politicians by cultivating their role inside a political party, and coming to base their power and their career upon their party connections.

 

But they need not make either transition; they may simply move into an inner circle, as an appointed consultant or adviser having intimate and trusted access to an official power-holder, to whom they are beholden for such political power as they possess.

There are, to be sure, other ways of classifying men as political animals, but these types - the party politician, the professional administrator, the political outsider - are quite serviceable in understanding the social make-up and psychological complexion of the political visage of present-day America.

Within American political institutions, the center of initiative and decision has shifted from the Congress to the executive; the executive branch of the state has not only expanded mightily but has come to centralize and to use the very party which puts it into power. It has taken over more initiative in legislative matters not only by its veto but by its expert counsel and advice.

 

Accordingly, it is in the executive chambers, and in the agencies and authorities and commissions and departments that stretch out beneath them, that many conflicts of interests and contests of power have come to a head - rather than in the open arena of politics of an older style.

These institutional changes in the shape of the political pyramid have made the new political command posts worthy of being struggled for. They have also made for changes in the career of the type of political man who is ascendant.

 

They have meant that it is now more possible for the political career to lead directly to the top, thus by-passing local political life.

 

In the middle of the nineteenth century - between 1865 and 1881 - only 19 per cent of the men at the top of the government began their political career on the national level; but from 1901 to 1953, about one-third of the political elite began there, and, in the Eisenhower administration, some 42 per cent started in politics at the national level - a high for the entire political history of the United States.*

 

* Only about 20 per cent of the political elite of 1789-1825 had done so; the historical average as a whole is about 25 per cent.⁸


From 1789 right up to 1921, generation after generation, the proportion of the political elite which has ever held local or state offices decreased from 93 to 69 per cent.

 

In the Eisenhower administration, it fell to 57 per cent. Moreover, only 14 per cent of this current group - and only about one-quarter of earlier twentieth-century politicians - have ever served in any state legislature. In the Founding Fathers' generation of 1789-1801, 81 per cent of the higher politicians had done so.

 

There has also been a definite decline in the proportions of higher politicians who have ever sat in the United States House of Representatives or in the Senate.*

 

 

* In 1801-25, 63 per cent of the political elite had been politicians in the House, 39 per cent; in the Senate; from 1865-1901, the proportions were 32 and 29 per cent; but during the 1933-53 era, only 23 per cent had ever been members of the House of Representatives, 18 per cent of the Senate. For the visible government of the Eisenhower administration, the proportions were 14 and 7 per cent.

 

 

The decline in state and local apprenticeships before entering national positions, as well as the lack of legislative experience, tie in with another characteristic trend.

 

Since there are so many more elected positions on the lower and legislative levels and relatively few on the national, the more recent members of the political elite are likely to have reached their position through appointments rather than elections. Once, most of the men who reached the political top got there because people elected them up the hierarchy of offices.

 

Until 1901, well over one-half, and usually more than two-thirds, of the political elite had been elected to all or most of their positions before reaching their highest national office. But of late, in a more administrative age, men become big politically because small groups of men, themselves elected, appoint them: only 28 per cent of the higher politicians in 1933-53 rose largely by means of elective offices; 9 per cent has as many appointed as elected offices, and 62 per cent were appointed to all or most of their political jobs before reaching top position; 1 per cent had held no previous political position.

 

Among the Eisenhower group, 36 per cent were elected to the top; 50 per cent had been appointed more than elected, and 14 per cent had never before held any political office.

For the American statesmen as a group, the median number of years spent in politics was 22.4; in non-political activities, 22.3. Thus, these top members of government have spent about the same time working in politics as in other professions. (For some of these years, of course, they were working at both at the same time.)

 

But this over-all fact is somewhat misleading, for there is a definite historical trend: until the Civil War, the top men spent more time in politics than in non-political pursuits. Since the Civil War, the typical member of the political elite has spent more years working outside of politics than in it.

 

Strictly political careers reached a peak in the generation of 1801-25, with 65 per cent of the total working life spent in politics. Outside activities reached their peak in the Progressive Era, 1901-21: at that time, professionals and reformers seem briefly to have entered high political positions, 72 per cent of this generation's active working time being taken up by non-political activities.

 

It is not possible to make this calculation for politicians since 1933 for their careers are not yet over.

All these tendencies -

(I) for the political elite to begin on the national level and thus to by-pass local and state offices

(II) never to serve in national legislative bodies

(III) to have more of an appointed than an elected career

(IV) to spend less proportions of their total working life in politics - these tendencies point to the decline of the legislative body and to the by-passing of elective offices in the higher political career.

They signify the 'bureaucratization' of politics and the decline at the political top of men who are professional politicians in the simple, old-fashioned sense of being elected up the political hierarchy and experienced in electoral politics.

 

They point, in short, to the political outsider. Although this type has prevailed in previous periods, in our time he flourishes, and in the Eisenhower administration he has become ascendant.

 

This administration, in fact, is largely an inner circle of political outsiders who have taken over the key executive posts of administrative command; it is composed of members and agents of the corporate rich and of the high military in an uneasy alliance with selected professional party politicians seated primarily in the Congress, whose interests and associations are spread over a variety of local societies.
 

 

2 - A small group of men are now in charge of the executive decisions made in the name of the United States of America.

 

These fifty-odd men of the executive branch of the government include the President, the Vice President, and the members of the cabinet; the head men of the major departments and bureaus, agencies and commissions, and the members of the Executive Office of the President, including the White House staff.

 

Only three of these members of the political directorate* are professional party politicians in the sense of having spent most of their working lives running for and occupying elective offices; and only two have spent most of their careers as 'behind-the-scenes' political managers or 'fixers.'

 

* As of May 1953.4

 

Only nine have spent their careers within governmental hierarchies - three of them in the military; four as civil servants in civilian government; and two in a series of appointive positions not under the civil-service system.

 

Thus, a total of only fourteen (or about one-fourth) of these fifty-three executive directors have by virtue of their career been 'professionals' of government administration or party politics.

The remaining three-quarters are political outsiders. At one time or another, several of them have been elected to political offices, and some have entered government service for short periods but, for most of their careers, they have generally worked outside the realms of government and politics. Most of these outsiders - thirty of the thirty-nine in fact - are quite closely linked, financially or professionally or both, with the corporate world, and thus make up slightly over half of all the political directors. The remainder have been active in various other 'professional' fields.

The three top policy-making positions in the country (secretaries of state, treasury, and defense) are occupied by a New York representative of the leading law firm of the country which does international business for Morgan and Rockefeller interests; by a Mid-West corporation executive who was a director of a complex of over thirty corporations; and by the former president of one of the three or four largest corporations and the largest producer of military equipment in the United States.

There are four more members of the corporate rich in the cabinet - two more men from General Motors; a leading financier and director of New England's largest bank; and a millionaire publisher from Texas. The positions of Secretaries of Agriculture and Labor are occupied by professional outsiders, leaving only one cabinet member who is an insider to politics and government -  the Attorney-General, who has been both a New York State Assemblyman and a partner in the law firm of Lord, Day and Lord, but has, since 1942, been a political manager for Dewey and later Eisenhower.

Although the Attorney-General and Vice-President are the only political professionals, two other cabinet members have at one time held elective state offices and at least five of the cabinet members were active in the political campaign of 1952. None of them

are, in any sense that may be given to the term, civil servants; the President is alone among them as a man trained in a governmental (military) bureaucracy.

On the 'second team' of the political directorate, there is a 'Little Cabinet,' whose members stand in for the first and, who, in fact, handle most of the administrative functions of governing. Among the top thirty-two deputies of the agencies, departments, and commissions, twenty-one are novices in government: many of them never held political office, nor in fact even worked in government, before their present positions.

 

These men usually have had fathers who were big businessmen; twelve attended Ivy League colleges; and they themselves have often been businessmen or bankers or the salaried lawyers of large corporations or members of the big law firms. Unlike professional politicians, they do not belong to the local jamboree of Elk and Legion; they are more often members of quiet social clubs and exclusive country clubs.

 

Their origins, their careers, and their associations make them representative of the corporate rich.

On this 'second team' there is one Rockefeller as well as a former financial adviser to the Rockefellers; there are working inheritors of family power and textile companies; there are bankers; there is a publisher, an airline executive, and lawyers; a representative from the southwestern affiliate of America's largest corporation; and another man from General Motors.

 

There is also Allen Dulles who spent ten years in the diplomatic service, left it (because a promotion in rank offered him no increase above his $8,000 salary) to join the law firm of Sullivan and Cromwell (about the time that his brother became its senior partner) and then returned to the government as its senior spy.

 

On this second team there are also four men who have not been directly associated with the corporate world.

Only seven of the thirty-two members of the second team have been trained in governmental bureaucracies; only four have had considerable experience in party politics.

In the complex organization of modern government, the need for an 'inner circle' of personal advisers has become increasingly important to the executive, especially if he would be an innovator. In order to originate and carry out his policies, he needs men who are quite wholly in his service.

 

The specific functions that these men may perform are enormously varied; but, in whatever they do and say, they function as the alter ego of their commander. These personal lieutenants of power are loyal agents, first of all, of the man to whose inner circle they belong. They may be professional politicians or professional civil servants, but usually they have been neither.

And yet they must mediate between party politicians in the legislative branch and the outsiders in the executive administration - as well as among the various outside pressure groups - and they must maintain public relations with the unorganized public. These men on the White House Staff, therefore, are not in office so much for what they represent as for what they can do.

 

They are a variety of skilled men, and they are socially alike in a number of ways: they are quite young; they come from the urban areas of the country, in fact from the East; and they are likely to have attended the Ivy League Colleges.

Of the nine key members of the White House Staff, six are novices in government and politics; there are no civilian civil servants; there is one professional party politician; one professional political manager; and one professional military man. The men of the President's inner circle thus come from Dewey's inner circle, from Henry Luce's, or from the higher levels of the Pentagon.

 

With few exceptions, they are neither professional party politicians nor political bureaucrats.*
 

* Of 27 men mentioned in recent descriptions of Eisenhower's golf and bridge 'cronies,' only two men could strictly be called 'politicians'; there was also his brother Milton, and there was Bobby Jones, the former golf champion; there was the president of one of the largest advertising agencies and Freeman Gosden, Amos of 'Amos and Andy'; there was a public relations executive and a Washington lawyer; there were two retired Army officers and there was Lucius D. Clay, the retired General of the Army who is now Chairman of Continental Can Company. There were three men identified only as local - to the Augusta National Golf Club - businessmen. All the rest were top officers of various corporations scattered among different industries and usually along the eastern seaboard. Represented on the golf course are Continental Can, Young and Rubicam, General Electric, Cities Service Oil Company, Studebaker, Reynolds Tobacco, Coca Cola, and Republic Steel.5 Between June 1953 and February 1955, Mr. Eisenhower gave 38 'stag dinners,' at which 'he has entertained 294 businessmen and industrialists, 81 administration officials, 51 editors, publishers, and writers, ³⁰ educators, ²³ Republican party leaders. A dozen other groups - farm, labor, charities, sports - have provided smaller numbers of guests.'⁶


As a group, the political outsiders who occupy the executive command posts and form the political directorate are legal, managerial, and financial members of the corporate rich.

 

They are members of cliques in which they have shown to their higher-ups that they are trustworthy in economic or military or political endeavors. For corporation executives and army generals, no less than professional politicians, have their 'old cronies.' Neither bureaucratic advancement nor party patronage is the rule of the political outsider.

 

As in the private corporation, the rule is the co-optation of one's own kind by those who have taken over the command posts.

The rise of the political outsider within the modern political directorate is not simply one more aspect of the 'bureaucratization' of the state. In fact, as in the case of the military ascendancy, the problem which the rise of the political outsider creates for the democratic theorist has, first of all, to do with the absence of a genuine bureaucracy.

 

For it is partly in lieu of a genuine bureaucracy that the pseudo-bureaucracy of the political outsiders, as well as the regime of the party hacks, has come to prevail.

By a 'genuine' bureaucracy, we refer to an organized hierarchy of skills and authorities, within which each office and rank is restricted to its specialized tasks. Those who occupy these offices do not own the equipment required for their duties, and they, personally, have no authority: the authority they wield is vested in the offices they occupy. Their salary, along with the honor due each rank, is the sole remuneration offered.

Of his various associates, Theodore Roosevelt once remarked:

'I am simply unable to make myself take the attitude of respect toward the very wealthy men which such an enormous multitude of people evidently really feel. I am delighted to show any courtesy to Pierpont Morgan or Andrew Carnegie or James J. Hill, but as for regarding any one of them, as for instance, I regard Professor Bury, or Peary, the Arctic explorer, or Rhodes, the historian - why, I could not force myself to do it, even if I wanted to, which I don't.'

Of President Eisenhower's associates, a shrewd observer - Merriman Smith - has remarked:

'It would be unfair to say that he likes the company of kings of finance and industry purely because of their Dun and Bradstreet ratings. He believes that if a man has worked up to become president of the Ford Motor Company, head of the Scripps-Howard newspapers, a college president or an Archbishop, then certainly the man has a lot on the ball, knows his field thoroughly and will be literate and interesting.'

To which William H. Lawrence has added:

'This business of working your way up will come as quite a surprise to young Henry Ford or young Jack Howard.'⁷

The bureaucrat or civil servant, accordingly, is above all an expert whose knowledge and skill have been attested to by qualifying examination, and later in his career, qualifying experience.

 

As a specially qualified man, his access to his office and his advancement to higher offices are regulated by more or less formal tests of competence. By aspiration and by achievement, he is set for a career, regulated according to merit and seniority, within the prearranged hierarchy of the bureaucracy.

 

He is, moreover, a disciplined man, whose conduct can be readily calculated, and who will carry out policies even if they go against his grain, for his 'merely personal opinions' are strictly segregated from his official life, outlook, and duties. Socially, the bureaucrat is likely to be rather formal with his colleagues, as the smooth functioning of a bureaucratic hierarchy requires a proper balance between personal good will and adequate social distance according to rank.

Even if its members only approximate the principled image of such a man, the bureaucracy is a most efficient form of human organization. But such an organized corps is quite difficult to develop, and the attempt can easily result in an apparatus that is obstreperous and clumsy, hide-bound and snarled with procedure, rather than an instrument of policy.

The integrity of a bureaucracy as a unit of a government depends upon whether or not, as a corps of officials, it survives changes of political administration.

The integrity of a professional bureaucrat depends upon whether or not his official conduct, and even his person, embodies the status codes of the official, foremost among them political neutrality. He will serve a new political administration and its policies as faithfully as he did the old. That is the political meaning of genuine bureaucracy.

 

For the bureaucrat as such does not make policy; he provides information relevant to alternative policies and he carries out the alternative that becomes official.

 

As a more or less permanent staff with a more or less permanent hierarchy beneath it, the bureaucracy is loyal only to the policies that are given it to execute.

'It has been recognized almost universally,' Herman Finer asserts, 'that interference with this neutrality [from political parties] means the loss of technical skill to the state as a whole, and only the most extreme minorities of the Left and Right have been ready to sacrifice this neutrality by "purification" of the services.' ⁸

The civilian government of the United States never has had and does not now have a genuine bureaucracy.

 

In the civil-service system, established in 1883, people appointed by the President and confirmed by the Senate are not 'required to be classified.' What constitutes 'The Civil Service' can change with changing political administrations.

 

Any rules of competitive recruitment can be by-passed by creating whole new agencies without established precedents; jobs can be classified and declassified in and out of the civil-service tenure and restriction; civil-service tenure can be made meaningless by the wholesale abolition of governmental agencies or parts thereof, not only by the Congress but by the head of the agency or by the Budget Bureau.⁹

Of the late nineteenth-century practice, an English observer noted that,

'while appointments to the lower grades were filled on the basis of merit, the pressure for spoils at each change of administration forced inexperienced, political or personal favorites in at the top. This blocked promotions and demoralized the service. Thus, while the general effect of the act was to limit very greatly the number of vicious appointments, at the same time the effect of these exceptions was to confine them to the upper grades, where the demoralizing effects of each upon the service would be a maximum.' ¹⁰

Since then, of course, the proportion of employees covered by the Civil Service has increased.

 

At the end of Theodore Roosevelt's administration (in 1909) some 60 per cent of all federal civilian employees were civil service; at the beginning of Franklin Roosevelt's, about 80 per cent. Much of the New Deal expansion involved 'new agencies which were staffed without competitive civil-service examinations.

 

By 1936 only 60 per cent of Government civilian employees had entered Government through competitive civil-service tests; many of the [remaining] 40 per cent were patronage appointments, and most of them were New Deal enthusiasts.' World War II brought another huge wave of government employees who did not win their jobs competitively. Once in, however, these government workers found civil-service protection; when President Truman left office in 1953, the tenure of 'at least 95 per cent of Government civilian employees' was presumably protected.¹¹

Now of the two million or so government employees,¹² perhaps some 1500 can be considered 'key officials': these include the head men of the executive departments, under-secretaries and assistant secretaries, the chiefs of the independent agencies and their deputy and assistant heads, the chiefs of the various bureaus and their deputies, the ambassadors and other chiefs of missions.¹³

 

Occupationally they include lawyers and air force officers, economists and physicians, engineers and accountants, aeronautical experts and bankers, chemists and newspaper men, diplomats and soldiers. Altogether, they occupy the key administrative, technical, military, and professional positions of the federal government.

In 1948, only 32 per cent (502) of such key officials worked in agencies which had a 'formal career service' - such as the foreign service of the Department of State, the military hierarchy, certain appointments in the Public Health Service.

 

The top career men averaged twenty-nine years in government service; over half of them had earned graduate or professional degrees; one-fourth, in fact, attended Harvard, Columbia, Princeton, Yale, MIT, or Cornell. These represented such higher civil service as the government then contained.

Two months before the party nominations for the 1952 elections, Harold E. Talbott - a New York financier, later a Secretary of the Air Force exposed for using his office for private gain - hired a management consulting firm to determine what posts it would be necessary for a Republican administration to take over in order to control the government of the United States.

 

A few days after his election, Eisenhower received a fourteen-volume analysis - including suggested qualifications for appointees and the main problems they would face - of each of the 250 to 300 top policy-making jobs that were found.¹⁴

More party-minded analysts knew that even under the laws and orders then existing, some 2,000 positions seemed open.¹⁶ Patronage is patronage, and the new administration quickly set about finding ways of increasing it.*

 

 

* 'Some jobs can simply be abolished,' the editors of Fortune asserted. 'Other men can be left with their tides while someone else is given the real authority and direct access to the department head. Some of the more notorious Fair Dealers may be shunted off into harmless, boondoggling projects. In government circles there are phrases for such techniques: 'letting him dry up on the vine," or "sending him to the reading room." Such methods are wasteful. And yet it is virtually the only way the Eisenhower Administration can be assured of having a force of key careerists whom it can trust... The new Administration has to tackle the government personnel problem from two opposite directions at once: on the one hand getting rid of top-grade careerists whose ideologies are overtly or covertly hostile to Republican policies; while on the other hand trying to make government service work, and thereby attracting top-grade men - which is the more important objective in the long run.'¹⁶

 

 

In April 1953, Eisenhower by executive order stripped job security from at least 800 'confidential and policy-making' government workers; in June, he released some 54,000 non-veterans from job security.¹⁷

The exact number of positions that the Republicans declassified is difficult to know with accuracy: one knowledgeable estimate puts the number at 134,000.¹⁸

 

But the withdrawal of jobs from civil-service coverage is not the only way to get in one's own people. Under a security ruling which rests upon 'a reasonable doubt' of someone's 'security-risk' status, rather than 'proof,' and which places the burden of proof upon the accused, thousands more have been fired or forced to resign from government service.

 

This has been especially damaging to the experienced personnel and morale of the State Department where such attacks have been most prolific and systematic.**

 

**On the downfall of diplomacy, see above, NINE: The Military Ascendency.

 

The details at any given time are not important; the over-all fact is: The United States has never and does not now have a genuine civil service, in the fundamental sense of a reliable civil-service career, or of an independent bureaucracy effectively above political party pressure. The fact of the long Democratic tenure (1933-53) had tended to hide the extent to which the civil-service laws had failed to result in the creation of a Civil Service.

 

The changeover of 1953 revealed, further, that the civil-service laws merely make the operation of 'patronage' more difficult and more expensive, and also, as it turned out, somewhat nastier. For there is no real question but that 'security clearance' procedures have been used to cover the replacement of untrustworthy Democrat by trustworthy Republican.

The superior man who might be bent on a professional career in government is naturally not disposed to train himself for such political perils and administrative helplessness.

No intellectually qualified personnel for a genuine bureaucracy can be provided if the Civil Service is kept in a political state of apprehension; for that selects mediocrities and trains them for unreflective conformity.

No morally qualified personnel can be provided if civil servants must work in a context of universal distrust, paralyzed by suspicion and fear.

And in a society that values money as the foremost gauge of caliber, no truly independent Civil Service can be built - either from upper or middle-class recruits, if it does not provide compensation comparable to that provided by private employment. Pensions and security of job do not make up for the lower pay of civil servants, for private executives, as we have seen, now have such privileges and many more as well.

 

The top civil-service salary in 1954 was only $14,800, and only 1 per cent of all the federal employees earned over $9,000 a year.¹⁹

The historical check upon the development of an administrative bureaucracy in the United States has been the patronage system of the parties, which as machines use jobs for pay-offs, thus making impossible office discipline and recruitment on the basis of expert qualification. In addition, since government regulation of business has become important, a government job has become important as one link in a business or legal career in the private corporate world.

 

One serves a term in the agency which has to do with the industry one is going to enter. In the regulatory agencies especially, public offices are often stepping stones in a corporate career, and as organizations the agencies are outposts of the private corporate world. And there is also the 'new spoils system' operating as a security measure in the context of distrust.

Magazines for business executives and ghost writers for politicians regularly run pious editorials on the need for a better Civil Service.

 

But neither executives nor politicians really want a group of expert administrators who are genuinely independent of party considerations, and who, by training and experience, are the depository of the kind of skills needed to judge carefully the consequences of alternative policies. The political and economic meaning of such a corps for responsible government is all too clear.

In the lower ranks of the state hierarchy, from which genuine civil servants might be recruited, there has not been enough prestige or money to attract really first-rate men. In the upper ranks, 'outsiders,' that is, men from outside the bureaucracy, have been called upon. They have served only for relatively short periods and not as a life career, and hence they have not acquired the neutrality and demeanor associated with the ideal civil servant.

There is no civil-service career that is secure enough, there is no administrative corps that is permanent enough, to survive a change-over of political administration in the United States. Neither professional party politicians, nor professional bureaucrats are now at the executive centers of decision.

 

Those centers are occupied by the political directorate of the power elite.

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