Power Elites versus Progressive Activists

This is an overview with a particular emphasis on the principal structural components of the anti-corporate network and on the strategic imperatives that have guided its development. The world is dominated by economic, political and military elites who exercise power by virtue of position. The power elites are composed of men and women in positions to make decisions having major consequences, they are in command of the major hierarchies and organizations of modern society. They rule the big corporations. They run the machinery of the states and claim its prerogatives. They direct the military establishment. They occupy the strategic command posts of the social structure, in which are now centered the effective means of the power and the wealth and the celebrity. These groups are comprised as celebrities, the very rich, chief executives and the corporate rich, the warlords and the political directorate. The power elites are not a capitalist class, but rather an organizational elite, one where entry might be facilitated by wealth but where the power resided not in the wealthy, but in the corporations themselves.

There is an argument that corporations and wealthy individuals (whose wealth has generally derived from corporations) support a web of quasi-philanthropic endeavors – family charitable foundations, university research programs and professorships – as well as policy-generating think tanks, all of which are driven through selective funding, and other inducements and constraints. These institutions work to define, investigate, refine and instigate public policies that are consistent with the interests of their corporate (and other) sponsors. The resulting university and think tank research and policy proposals are publicized through the major media – mostly owned and influenced by corporate elites – where their visibility is raised, presumably to the point of inevitability. They then enter the more traditional political process, where they are reviewed, occasionally modified, adopted, implemented and adjudicated by the executive branch.

In contemporary societies, corporations have been afforded a privileged status. Corporations provide jobs, produce the overwhelming majority of goods and services, and provide a substantial portion of the tax revenues that sustain popular government. They are legally protected through de facto citizenship, protective regulation, freedom of speech. They are powerful. And, precisely because they are the repository of so much economic, political and social authority, they are widely distrusted, disliked.

The key insight on the dominant role of progressive activists that have produced a viable movement today came from the wedding of the progressive, populist and anti-corporate frame with the activists’ understanding of the workings of the "power structure" to produce, a "counter-structure" based on the same power dynamic. Recall that in the power elite model, corporations and wealthy individuals channel their wealth through foundations that support think tanks and university researchers who, in turn, generate and legitimize an agenda of policy options that facilitate and, at the same time, constrain the available range of decision-making. There is considerable evidence that progressive activists have set out to construct an alternative power structure along these lines.

The component elements of these alternative power structure include:

- Philanthropy by wealthy individuals is being redirected from supporting traditional social and cultural causes such as education and healthcare to underwriting activist causes such as environmentalism and human rights.

- Private foundations are pooling and distributing wealth to advance and support progressive activism, often according to their own self-actualizing agendas, and in some instances in ways seemingly contrary to the founders’ intentions.

- Think tanks, advocacy groups and university researchers are developing and legitimizing progressive-left policies under rubrics such as social justice and corporate social responsibility. Activist groups represent through their demonstrations and other public actions the populist or democratic façade of progressivism much as political parties, campaigns and elections represent, in the elitist theory view, the democratic façade of the corporately dominated establishment.

Much of the activity we are describing here could be tax exempt. The idea is that a tax exempt charity makes a decision to support a nonexempt project, and in the process extends a sort of umbrella of tax exemption over that project, at least insofar as it retains complete discretion and control over the funds and so long as the project itself advances the sponsor’s tax-exempt objectives. In this way, activities that do not qualify for tax exemption in their own right may legally benefit from tax-exempt contributions. Recognizing the value of such an alternative power structure and bringing substantial portions of such a scheme into existence has been great achievement. But more fundamentally, progressive activists recognized that underlying the elite power structure is a key resource that not only drives the system itself, but provides peculiar leverage over the chosen enemy - the corporation.

But most corporations of any size and power today are owned, not by a founding entrepreneur or his/her heirs, but by thousands of absentee owners, the shareholders. The founder or family may retain a substantial interest in the corporation, but typically does not control a majority of the voting shares. The shareholder resolutions relating to issues of social policy submitted to companies, are significantly on increase to put to a vote before shareholders. In recent years, however, there has been a systematic effort by activist investors to promulgate an alternative definition of best interests that emphasizes social values – environmentalism, support for human rights, pro-union workplace policies. These activists, who speak of an alternative or dual bottom line, one financial and one social, are seeking to redefine the corporation as a social as well as an economic entity, a view that is entirely consistent with the power-elite formulation. But more significantly, they are trying to use the immense financial power of the mainstream institutional shareholders as leverage to force corporations to adopt progressive social policies. Progressive activists are now being taken seriously in many board rooms, and increasing numbers of corporations are taking their agenda into account in making business decisions.

The activists have turned to the phenomenon known as the corporate campaign, a comprehensive psychological, political, regulatory, legal and economic assault on corporate reputations and business practices. The points of leverage to force changes in corporate policy was developed primarily within the labor movement, when a technique was devised as power structure analysis with the idea that, by identifying and undermining a target company’s most critical stakeholder relationships – with its customers, suppliers, bankers and the like – and by effectively waging war on its "reputation", a union could bring a great deal of pressure on management. To this end, the union, often working with allies and surrogates, would bring lawsuits or other actions against the company, boycott its products, attack its credibility or engage in any number of other actions that had at their core, an effort to embarrass those who did business of any sort with the target company, turning each of these stakeholders into pressure points against management. As the pressure built to an intolerable level, the company would yield. These ideological and programmatic activists that have no inherent stake in the viability of their targets, seeing specific corporations or industries such as mining or petroleum as net evil-doers whose elimination, and reduced success, would benefit society - they are as a result, less constrained in their selection of tactics than labour unions. For that reason, we can think of the campaigns waged by these non-labor activists as anti-corporate campaigns.

Environmental, human rights and other activists’ campaigns are not well-funded, but their objectives and tactics may be extreme, and are surely political. Here is an outlet for the resources flowing through the newly developed left activism, one that targets the defined enemy as it demonstrates the power of the new progressivism.

Netwar is defined as an emerging mode of conflict… in which the protagonists use network forms of organization and related doctrines, strategies and technologies attuned to the information age. One of the best examples of netwar to date is provided by the Zapatista Movement in Chiapas, Mexico, where international NGOs interacted with and helped to legitimize and sustain a quasi-revolutionary movement, and where computer and other electronic networks kept a small and otherwise isolated guerilla movement in the news for months. These were capabilities that the Zapatistas on their own simply did not possess.Many NGO activists sensed they were molding a new model of organization and strategy based on networking that was different from Leninist and other traditional approaches to the creation of social movements. While electronic communication is a key element of netwar, and while the progressive Left has made extensive use of the Internet and other such means in rebuilding the movement, it is the social networking aspect of netwar, or social netwar, that is most revealing of the underlying strategy being employed on the larger stage. The general components of an example network of the foundation/NGO, include activist foundations, the social-policy investment community and shareholder activists, activist pension funds, unions, environmentalists and religious activists.

The progressive- activist community today is broadly based, highly sophisticated, well financed, highly motivated and broadly integrated. And this network of philanthropists, foundations and NGOs is focused on achieving its diverse aims through a common and interactive strategy, the waging of a war of reputation, regulation, litigation and financial pressure on the corporation, both individually and institutionally. It is today the dominant model of exchange between the activist communities and the corporate community.