Solidarity in Strategy

Making Business Meaningful in American Trade Associations

Lyn Spillman

• Publisher: University of Chicago Press
• Year: 2012
• Print ISBN: 9780226769578, 9780226769561
• eBook ISBN: 9780226769554
• Topic: Social Sciences
• Subtopic: Business General
• Index: Social Sciences

Popular conceptions hold that capitalism is driven almost entirely by the pursuit of profit and self-interest. Challenging that assumption, this major new study of American business associations shows how market and non-market relations are actually profoundly entwined at the heart of capitalism.

In Solidarity in Strategy, Lyn Spillman draws on rich documentary archives and a comprehensive data set of more than four thousand trade associations from diverse and obscure corners of commercial life to reveal a busy and often surprising arena of American economic activity. From the Intelligent Transportation Society to the American Gem Trade Association, Spillman explains how business associations are more collegial than cutthroat, and how they make capitalist action meaningful not only by developing shared ideas about collective interests but also by articulating a disinterested solidarity that transcends those interests.

Deeply grounded in both economic and cultural sociology, Solidarity in Strategy provides rich, lively, and often surprising insights into the world of business, and leads us to question some of our most fundamental assumptions about economic life and how cultural context influences economic.

CHAPTER ONE

Solidarity, Strategy, and the Meaning of Business

Everyone knows that self-interested action in the pursuit of profit is the fundamental dynamo of contemporary economic life. We know that capitalist production and exchange require systematic competitive profit-seeking in markets. We know that firms survive by making money. And so we assume that people in business think of what they are doing to make that happen as rational, self-interested, profit-oriented action.

In this book I challenge this assumption that business is necessarily conducted as self-interested action in the pursuit of profit. I ask an apparently naive question: what makes self-interested action in the pursuit of profit make sense? That is, how do firms and the businesspeople who run them understand their interests? What meaning-making sustains their action? What cultural categories and vocabularies of motive make capitalist understandings of their norms of exchange, objects of exchange, and exchange partners routinely plausible—for capitalists? These questions about business culture and about how profit-seeking actors really understand what they are doing are almost never investigated, because the stereotype of the rational pursuit of economic self-interest has been so powerfully naturalized—even for the most sophisticated observers—in public narratives, in economic models, and in social theory.

To examine how profit-oriented firms and businesspeople make sense of their interested action, I analyze their discourses and strategies of action in contemporary American business associations. Economic sociologists and economists have almost entirely ignored this busy and often surprising arena of American economic activity, so in order to study it I first develop a unique overview of the population of national business associations. Analyzing a new census of these associations and extensive archival data from twenty-five representative groups, I argue that these stable, long-lasting groups are, primarily, institutional settings for routine cultural production—generating categories, networks, industry fields, collective identities, norms, status orders, and camaraderie that orient and motivate economic action.

Then, exploring the meaning-making about business that actually goes on in these settings, I show that businesspeople often understand themselves as disinterested rather than self-interested actors. They often think of what they are doing in terms of technical expertise, professionalism, stewardship of the public good and occupational community, and these vocabularies of motive are a constitutive part of many business identities.

I argue that the pursuit of strategic interest in competitive profit-seeking is conditioned by and relies on institutions and discourses transcending strategic interests, and that such institutions and discourses make capitalist economic action routinely meaningful. Anybody concerned about the power of business needs to understand these important themes in business culture.

This argument expands and adds force to the arguments of scholars who investigate the cultural embeddedness of economic action. Many sociologists now recognize that culture shapes economic action; they show how particular economic “interests” are culturally constructed, and how market and nonmarket relations are profoundly intertwined in everyday life. Looking at how interests are understood in business associations demonstrates that we need to reexamine the very idea of “interests,” not only the cultural construction of particular economic interests in particular circumstances. And it shows how market and nonmarket relations are profoundly intertwined even at the heart of capitalist action.

Culture and Economic Interests

The assumption that capitalist production and exchange requires a disciplined orientation to systematic, competitive profit-seeking in markets generates a series of familiar and well-worn contrasts—between market exchange and social redistribution, exploitation and reciprocity, corporations and nonprofits, purchase and intimacy, “market” and “society,” and between self-interest and altruism. Positioned by these contrasts, the archetypal capitalist actor will do everything possible to pursue narrow interests in shameless ways at the expense of others, will try to shape state policy to protect profits, and will promote cold and unjust ideologies. Even where welfare states, corporatist regimes, legal regulation, or paternalistic virtue soften the harshness of capitalism, these are only secondary remedies. This profound opposition is epitomized in Charles Dickens’s nineteenth-century morality tale of businessman Ebenezer Scrooge’s conversion, A Christmas Carol.¹

Certainly, as many sociologists recognize, economic interests are constantly shaped and changed in cultural processes. Certainly, as theorists like Marx and Polanyi suggest, the world has seen other fundamental principles of production and exchange. And certainly, at a more mundane level, business commentators often promote cooperation in teamwork, social responsibility, business ethics, nonprofit management, and so on. Yet even recognizing all this, we surely must admit that in the here and now, in the annual reports and acquisitions, in the outsourcing of labor, the infolding of new technologies, and the marketing excess, economic life in contemporary society requires strategizing about the next statement of earnings or market share, or submitting to the demands of those who must do so. Intermittent public scandals and destructive systemic failures only reinforce the point.

Looking briefly at how classical social theorists understood modern economic exchange clarifies this apparent inevitability and suggests a way forward.

The Classical Origins of the Problem of Capitalist Interests

The easy and compelling familiarity of conceptual oppositions between “market” and “society,” “self-interest” and “altruism,” and all the other similar and related contrasts (as well as the ways they are sometimes complicated and challenged) is an echo of long centuries of reflection, analysis, and critique by social theorists close to and preoccupied with the development of capitalism in Europe. As any reader of the sociological classics is well aware, modernity is characterized by increasing and increasingly dynamic penetration of market institutions to all arenas of life, the dominance of markets over alternative exchange institutions, and even the transposition of market logics to other institutions and other forms of collective action.

As capitalism became established, in one way or another, across the globe, and as it has changed under the influence of critical challenges, state action, and varying local contexts, the idea that systematic pursuit of particular economic interests in profitable production and exchange is a requirement of modern economic action thus acquired the incontrovertibility of common sense, for both celebrants and critics.

In fact, the large-scale changes in social organization that spread as production came to be organized for market exchange and capitalist business expanded demanded three distinct changes in economic culture. First, traditional views of potential objects of market exchange were radically expanded. Most important, labor became a central object of market exchange: but the expansion also ultimately encompassed generalized commodification that, if it was not total, was at least vastly more comprehensive than in precapitalist societies, and was theoretically unlimited in the economists’ abstract notion of utility. Second, traditional views of potential partners and competitors in exchange—the “imagined community” of the market—were likewise radically expanded in practice and abstracted from particularistic social relations in newly developing economic theory. Third, profit-seeking on markets became the normative model of exchange relations, at the expense of exchange relations dominated by reciprocity or redistribution. These cultural conditions for capitalist market exchange could vary independently, but they are often collapsed and reduced to the third, competitive profit-seeking as the dominant normative model of exchange—and the necessity of this normative capitalist culture was least often challenged.²

For Adam Smith, of course, removing restrictions on humans’ putatively natural inclination to “truck, barter and exchange,” and giving competitive profit-seeking free rein as a foundational principle, generated increased commodification and the abstraction of markets from traditional social relations. Objects of exchange proliferated; partners in exchange were no longer restricted. Self-interested exchange could lead to better macrosocial housekeeping, taking care of society’s infrastructural chores in a generally more effective way. The power of these ideas is evident in their familiarity even today, not only in popular and scholarly economics but also in commentary on problems ranging from environmental risk to conflicts in developing countries.³

Later, Marx retained the political economists’ conviction that norms of market exchange in capitalist societies could be nothing other than competitive and self-interested. He deplored the fact that labor increasingly became an object of exchange, and also the “fetishism of commodities,” and noted as well the expanded range of potential market relations. His analysis of capitalism, too, still echoes in the contemporary public sphere, in generic critical discussions of such topics as consumerism, social inequality, corporate malfeasance, and economic globalization. Of course, he highlighted the exploitation, loss, and suffering that these abstractions from traditional social relations entailed in much greater depth than Smith and the political economists. But although they differ in their evaluation, both Smith and Marx share the view that the idea of systematic production for competitive, self-interested market exchange lies at the core of capitalist modernity. They set the deep terms of debate about economic processes, generating and regenerating new analyses and applications in new economic circumstances as well as innumerable theoretical addenda.⁴

The originality and significance of Max Weber’s economic sociology lies partly in the fact that he did indeed famously highlight the cultural peculiarity of capitalist norms of exchange and wondered how they might have become widely established. He argued that while self-interested profit-seeking was not confined to capitalism, capitalist norms of exchange came to dominate economic life in the West as an unintended consequence of early Protestants’ insecurities about their ideal interests in religious salvation, and of the individual disciplines—like systematic planning and record-keeping and limits to consumption—imposed by early Protestantism. His broader theory of economic action in his major works deepened this account by identifying institutional conditions for the contingent success of this historical accident in ways that could illuminate economic development elsewhere. But if economic and religious meanings were intertwined in the origins of capitalism, and that explained how capitalist norms of exchange first came to dominate economic life, Weber saw less need to account for their persistence. They had become the inescapable “iron cage” of modern life. His ideal type of modern, market-oriented economic activity was transient, rationalized, and competitive. He knew that many real economic relationships might fall short of this ideal-typical model, with political institutions shaping interests and “communal” cultural orientations sometimes diluting hardheaded individualistic rationality (e.g., a market relation may “involve emotional values which transcend its utilitarian significance”). But the necessity of a rationalized orientation to production for self-interested, profit-driven market exchange was the inescapable core of modern economic action for Weber, even though he set this norm of exchange in historical and cultural context. Like Smith and Marx, he saw economic action in modern life as a rationalized and expansive systemic orientation to competitive profit-seeking in markets.⁵

Durkheim moved even further beyond Smith’s and Marx’s concerns, to the extent that he is only rarely understood as a theorist of capitalism. Yet he speaks directly to the classical problem of capitalist interests in exchange in at least one very important way: in his analysis of the technical and social division of labor. Whereas Weber asked how the self-interested pursuit of market exchange could emerge as a dominant economic force, Durkheim begins to raise the usually unasked question about how it could plausibly be sustained. For Durkheim, increasing social differentiation and a complex division of labor were fundamental features of modernity (and not only in economic institutions). He was struck by the potential problems for social solidarity posed by increasing differentiation and complexity in modern societies, in contrast with simpler societies in which members shared similar experiences, perceptions, and evaluations. For instance, no society could function simply on the basis of contracts between self-interested individuals: for contracts to be effective there needed to be a shared belief in the legitimacy of contract. More generally, shared meaning was essential even in complex societies in which individuals and their interests were highly differentiated and often conflicting.

By asking how solidarity was possible in complex societies, Durkheim was also asking how society could sustain the vastly widened and potentially unlimited expansion and abstraction of potential partners in market exchange, which was one of the major cultural changes brought by capitalism. He rejects the assumption that the norm of the systematic, self-interested pursuit of profitable exchange was sufficient to account for the social cohesion of complex capitalist societies (the assumption that was explicit and positive in Smith, more implicit and negative in Marx, and ideal-typical but qualified in Weber). Many subsequent scholars have explored how the sort of solidarity that interested Durkheim is generated in modern societies, for instance, in the political realm. But the radical implications of his theory of solidarity for our understanding of economic life have yet to be fully explored. Critics as well as believers in capitalism have, since Smith and Marx, emphasized that its normative core is the self-interested pursuit of profitable market exchange; so they have not asked—as Durkheim did—how that norm could be meaningfully sustained. By theorizing solidarity in the complex division of labor—which entailed the vast expansion and abstraction of the “imagined community” of partners and competitors in exchange—Durkheim offers leads for answering that question. As many generations of critics have argued, his vision underemphasizes the politics of self-interest in capitalism in general. But Durkheim’s project suggests that assuming nothing but self-interest—as Smith and Marx often did—is also naive and shortsighted.⁶

Mostly, though, earlier classical theorists’ understanding of self-interested exchange in capitalist economic life are so deeply ingrained in both theory and public discussion that the necessity of an orientation to production for profitable exchange in capitalist modernity has gone almost unquestioned on all sides. This radical essence of capitalism organized the standard dichotomy drawn between market and society and all its variants, setting the terms for most developments and critical debates since. It is easier and more common to investigate and debate changes in the limits and the appropriate objects of commodification—such as the issue of medical care—and the limits and possibilities of expanding inclusion in markets—such as the issue of globalization—than to investigate and discuss capitalist norms of exchange and their alternatives.

Unlike cultural assumptions about commodification and legitimate market actors, the important assumption that market action is necessarily oriented by a norm of self-interested exchange is rarely subjected to empirical investigation. A murmur of dissent did persist throughout the twentieth century, especially among social scientists inclined to demonstrate that ideas about economic interests look more complicated in real life than they do in economic theory. Important general challenges to standard assumptions about market action in capitalist societies were made not only by Polanyi, as noted above, but also by such scholars as Marshall Sahlins, Mary Douglas, Talcott Parsons, and Neil Smelser.⁷ But considering that economic analysis dominated scholarly research on markets, that economics treats orientation to self-interested exchange as a primordial constant (even as increasingly sophisticated economic theories accounting for cooperative action have emerged), and that economists have been most interested in markets as price-fixing mechanisms, it is not surprising that the norm of self-interested exchange on markets is still generally taken for granted. Durkheim’s concern about how solidarity could work at the heart of economic life in complex societies remained peripheral. Contemporary economic sociology reopens this issue, but has not yet attacked it head on.

Culture and Interests in Contemporary Economic Sociology

For most of the twentieth century, sociology effectively ceded understanding of market action to mainstream economics. Most sociologists focused on human action and institutions that were affected by but analytically distinct from production and exchange. Market norms became an unanalyzed background to other sociological concerns about the impact of commodification, rationalization, organizational structure and strategy, the organization of labor, and systematic power inequalities. As Viviana Zelizer among many others pointed out, many sociologically inspired critiques of market processes tended to take markets (unlike other social structures) as institutionally undiff...

Table of contents

• Cover
• Copyright
• Title Page
• Contents
• Acknowledgments
• Chapter 1. Solidarity, Strategy, and the Meaning of Business
• Part I. A New View of American Business Associations
• Part II. American Business Associations as Cultural Institutions
• Part III. American Business Associations and Economic Action
• Part IV. American Business Associations in Politics
• Notes
• Bibliography
• Index