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The History of the EU-6

October 31, 2005


Innovative factory design, c.1927

[ 1 | 2 | 3 | 4 | 5 | 6 ]

[Some Important EU Institutions]

A great many people agree that the 1968 upheavals in France altered European politics permanently; but how? In order to answer this question in a rigorous fashion, we need to examine the fundamental constituents of Western European politics.

  1. labor unions
  2. industrial managers
  3. capital markets
  4. the media
  5. student groups
I'm going to analyze each of these semi-separately, although of course they interact with other (students, for example, eventually become industrial managers).

1. LABOR UNIONS

It seems reasonable to argue that labor unions were the most powerful agent of the 1968 upheavals. Moreover, I would submit, they were the biggest beneficiaries, both in terms of their claims to represent the preponderance of European workers, but in terms of their autonomy from political parties and in terms of their internal administration. In the latter aspect: the development of a new, cohesive mode of action turned the movement into a far more powerful one than it had been before.

According to some analysts (e.g., Andrei S. Markovits), there was a wide gap between the labor movements in southern European countries like Italy and France, in which the unions were essentially Marxist, and those farther north, in which they were dominated by "Social Democratic" parties. I'm not convinced by this distinction. In France and Italy, for example, the main industrial union organization was a "Confederation of Labor" (in France, Confédération Générale du Travail—CGT; in Italy, Confederazione Generale Italiana del Lavoro—CGIL), and a non-Communist "Workers Force" splinter, plus a Roman Catholic union movement. A similar condition prevailed in the francophonic portion of Belgium; in the Flemish region, the Catholic union was far stronger. As a rule of thumb, the labor movement was about two-thirds Communist, and one-third social democrat or Roman Catholic.

In France and Italy, it is true, this meant that the labor movement was dominated by leaders who called for a revolutionary overthrow of Communism, while in the UK, Germany, the NL, and Scandinavian countries, the labor movement was cohesive; e.g., the German Confederation of Trade Unions (Deutscher Gewerkschaftsbund—DGB) is not controlled by any one party. The UK's Trade Unions Congress (TUC)/Scottish TUC (STUC), until 1994, essentially counted the Labour Party as its political wing; because of the two-party character of British politics, the Labour Party has to be harbor to an immense range of political opinions, and so it has been an unruly home to radicals, Communists, liberals, and many others.

However, in all industrial democracies the unions became kingmakers as a means of bureaucratizing power.1 In the USA, the AFL-CIO emerged as the frontline antagonist to Communist control of the labor movement. Its international division cooperated with the CIA to help prevent Communist takeovers in other unions, while in the USA itself the AFL-CIO, and not HUAC, actually confronted both Marxists per se, and also any labor-solidarity groups ("amateurs") from outside the rank-and-file. In the future EU member states, the unions and their federal entities wound up in partnership with conventional bourgeois politics. They tacitly agreed to play down, and then to squelch, talk of liquidating the bourgeois state and monopoly capitalism. When the economic recovery of the early 1960's picked up speed, even the "Communist" union organizations accepted labor market segmentation. When confronted with their own ideological antecedents, the Marxists merely said the objective conditions for a working class revolution were not at hand.

The upheavals of 1968 altered the classic party divisions. Instead of the familiar Social Democrats vs. Communist clash, the "New Left" and contemporary movements denounced all bureaucracy. At times this was patently absurd; for example, in the battle for the French factories described in the previous installment, the student Action Committees demanded no bureaucratic institutions of any kind. Without any system of accrediting a committee's members or the votes it took, an infinite number of committees—including those with no union members—could purport to make decisions. At the same time, however, the union bureaucracies had themselves turned into industrial ranches for herding segmented laborers into channels that served the bureaucracy. In other words, the entire notion of "left" as either a goal or a concept of direction, had lost all shred of meaning to everyone. The left elite had sided vehemently with state-managed accumulation of capital; it helped enforce conservative social mores, while promoting nuclear power and anti-green industrialization.

The Labor movement in Germany and the NL was far more aggressive in confronting employers and getting benefits for members. One plausible explanation is that both union management and the industrial managers had lived through fascism. Fascism, in power, betrays all classes alike in the service of its own bureaucracy, including the bosses it had once promised to serve. But the most resolute and well-proven enemies of the Nazis and the Communists were the SPD. The SPD had fought the Communists as relentlessly as they could under the Weimar Republic; the Nazis had put both in concentration camps. The post-war political reconstruction easily adapted to a sort of political pre-imminence for the Christian Democrats, and a trade union pre-imminence for the Social Democrats. Still, the labor movement in Germany had become a ward of the SPD. After 1968, it became divorced from the political machinery; unions were hereafter to embrace as an ethical principle the concept of adversarial relationships to all political institutions.

Finally, labor unions ruptured first with the sterile doctrinalism of the "classical" period; they experienced a phase of extremely radical searching; and emerged with a large cohort of intellectual aides-de-camp. At this point, the unions became tied to thinktanks and research in industrial relations. This was to lead to a decisive conquest of the prior bureaucracy by planners and managers whose tools of debate were regression analysis and anthropology. Realists about human behavior, they tended to respect the need for western institutions that could restrain bureaucracy.

2. INDUSTRIAL MANAGERS

Industrial management in the EU experienced a favorable development in the wake of 1968 that consisted of assimilation; industrial management in the USA experienced a stagnation and decay that was hastened by a revolution in business affairs. This will come as a surprise, but on further examination it will become obvious.2

In 1968, industrial managers varied considerably across members of the future EU. In the south, the rate of industrialization was now high, but since industrialization was highly bureaucratic and indifferent to consumer goods, the elites were very similar to managers in the USSR: they were ideological, privileged, and politically specialized. Political connections and a convincing anti-Communist credential was the ticket to success in the IRI, Italy's huge cartel system. In France, industrial management tended to mimic feudal or renaissance systems of productive organization. The aviation industry, for example, was closely analogous to the atelier system of the Italian Renaissance, in which a team of craftsmen perfected their skills under the iron hand of a brilliant perfectionist master. The master, in turn, bore personal responsibility for the excellence of the product.

In the 1968 upheavals, the companies emerged triumphant. But the middle managers of European industry were left to deal with a surly and radicalized laborforce. Moreover, there remained the obsession with reversing the huge trade deficit with the USA (a feat that has been achieved with unimaginable thoroughness). Gradually, industry rationalized. The larger hierarchies of the new industrial firms implemented management technology; older generations of managers, who despised the application of psychology to production, were soon replaced by those who embraced it. The "touchy-feely" management techniques, as it happened, had been developed to improve morale and teamwork; much of the time, despite the carping of reactionaries, they actually worked. Process engineering became a standard feature of industry, even if it was done in a very crude way. In general, however, the main feature of industrial management in the future EU member states was that it adopted humanizing principles at increasing speed. European workers, including managers themselves, worked more efficiently because the climate was less physically and morally taxing for any given length of time.

In contrast, US industry experienced a perverse revolution. With its stupendous consumer market, American firms were as confident as possible. While the shocks of the 1970's oil crisis tarnished this somewhat, management was mainly influenced by the "computer revolution." Firms like Digital Equipment Corporation (DEC), Data General, and later, Microsoft and Apple, consciously mimicked the bohemian climate of the counterculture in order to supply devices that allowed the administration of large bureaucracies more efficiently than ever before. There is nothing inherently wrong with this, and it happens that US firms also borrowed humane management techniques. But the latter was more heavily influenced by the Stakhanovite methods of the computer industry. The computer industry flourished, and its managers were convinced that it was because they had a special knack for management. In fact, it was because the field was new, and the returns to digitization of processes were immense. Inferior managers flourished provided they had a vital format; excellent managers or excellent institutions lost out if they were dependent upon an obsolescent format.

The adoption of digitization processes was in some respects a lottery; it was uncertain if a process, once adopted, would suffer the collapse of its supplier. In many cases, the supplier might have gone bankrupt, and was unable to deliver products its customers had ordered. For many years, therefore, many industries experienced not so much an invisible hand, as an invisible Gestapo of random and pointless upheaval. The winners enjoyed windfalls from new monopolies; the losers went out of business. Competence had nothing whatever to do with it.

All the while, US industry was experiencing a hollowing out. Industry became almost willfully self-destructive. Exports imploded; American managers seemed to adopt the principle that they were nothing more than capital managers. Figures such as 'Chainsaw Al' advertized their machismo by sacking huge numbers of workers, seldom with any real increase in productivity. At the same time, industrial managers developed a sort of "identity politics," exemplified by Rush Limbaugh (although himself never a manager) and Dick Cheney (who often places calls to Rush Limbaugh's program). Rather than master new managerial techniques, managers learned to manage incompetence. They became more efficient in presenting their case to Congress. They took command of AM radio and Fox, and established a crucial alliance with the evangelical right. And they exploited the alarm aroused by the burgeoning trade deficit to appeal to economic, and then jingoistic, nationalism. This last measure as a masterstroke; it won the day for an industrial class that had lost any value to the American industrial system.

3. CAPITAL MARKETS

The most famous capital market in the world is the New York Stock Exchange (NYSE). So it seems strange to learn that the NYSE is now little more than a casino; its role in raising capital for enterprise has diminished to such an extent. In fact, stock markets are a relatively important source of venture capital in the USA, but far less so than in the EU. Moreover, EU-based institutions manage the $700-800 billion annual capital influx to the USA, including the much-discussed streams from China and Japan. China and Japan, however, usually seem to unload their US dollars; Europeans buy them in exchange for equities in US firms.

The massive concentration of financial power in the hands of EU-based intermediaries is complex and owes little to the 1968 revolutions. However, I'll just sketch a little map of what happened. In essence, European industry consolidated very rapidly during the period 1947-1975. In many cases this was a deliberate response to the competition in capital goods markets from the United States and Japan. In other cases, however, it was an ineluctable response to member states requiring their employers to improve the general level of employee benefits. The benefits were mandated by the state, but the responsibility of firms. At the same time, there was a wave of explicitly state-guided programs to stimulate capital investment. During this period, capital investment by EU enterprise began to surge, and exports boomed. However, there was a problem.3

In order to administer the new industrial policies of the EU member states, as in all countries that adopt an industrial policy, the governments allowed cartels. In cases where new industrial management techniques were to be implemented, the governments promoted mergers. This led, of course, led to a reduction in the level of output (and consequently, employment of labor and capital) that firms would chose, given any particular level of interest and price level. In a market where there are many competitive firms, any firm will expand production up to the point that marginal costs are equal to price. Under conditions of monopoly (or imperfect competition), however, there is only one firm and its demand curve is the demand curve for the entire industry. It will therefore reach MR = MC at a lower level of output. National governments can still stimulate the economy with fiscal policy (deficits to stimulate aggregate demand), monetary policy (reduced interest rates), trade policy, or industrial policy (favored access to resources, tax policies, etc.), but more stimulus will be required to sustain full employment.

Added to this was the monetary policy problem of the 1980's, when the US Federal Reserve's shock therapy triggered a more grievous reaction by the central banks of Western Europe (which sought to restore a favorable exchange rate vis-à-vis the USD through interest rates, against strong market pressures). The EU was to remain "stuck" at about 70% the US level of per capita GDP thereafter, but enjoyed the benefits of a tamed capital market and net exports. Parliamentarians, as they do always and everywhere, fume at the flight of capital to the shores of some resented other country, but they like the alternative even less.

Again, this has little to do with the political upheaval of 1968 and much to do the oil crisis, the restoration of high levels of productivity, and the preference of Europeans for a stable economic administration over an erratic and unreliable one.

4. THE MEDIA

This is far too large a topic for a single entry, let alone, a portion of an entry. However, the news and entertainment media of EU member states tends to be divided into three very different and incomparable categories:

  1. print
  2. radio & television
  3. film & audio
Then, to make matters more complicated, the EU is divided into four regions with very different characteristics:
  1. France, Italy, and Belgium
  2. Germany, Austria, the NL, & Nordic countries
  3. UK & Ireland
  4. Spain, Greece, and countries admitted since
The UK and Ireland are distinct because they represent a highly integrated market with the Commonwealth (including, I might add, a huge cross section of US nationals). The USA and non-CW countries have more than taken the place of the CW as "strategic depth" for the British news and entertainment media, which tend to be more scope-wise integrated than the rest of the EU (and less so than the US market is now). The "late arrivals" to the EU constitute another story, evolving as they did in the framework of the Cold War rather than that of European integration. So, regrettably, I cannot discuss them here.

That leaves us with the Northern European media and the Southern European media. In regards to the entertainment media, there is an immense degree of market penetration by US products, mainly of Hollywood (i.e., the main corporate media establishment based in Los Angeles, California). Oddly, non-mainstream US media products, such as the Sundance film festival offerings, are not especially well-known. Hence, the term "Americanization" (used to denounce the prevalence of US-origins media products in non-US markets) is a misnomer, since the market does not favor US products per se, but ones with "celebrity authenticity." My view is that media concentration will tend to defeat efforts to fight it, because such efforts are based on nationalist resentment; they elevate the "celebrity" of Hollywood movies by treating each release as another 9/11 attack. As for "Americanization" of the news media in Europe, I highly recommend "Americanization, Globalization and Secularization" by Hallin & Mancini.

News media is zone 1 (Italy, Belgium, France) was traditionally dominated by carefully administered state media, analogous to the BBC in the UK. Public service media has numerous advantages over the commercial variety; it has two important disadvantages. The first is control; usually public broadcasting is state-owned. The BBC and the [Irish] RTE are fairly successful entities and not exactly patsies for the sponsoring state; however, there is an understandable scorn for the journalistic standards of other state-owned broadcasting entities (SOBEs). This stems from an error about SOBEs, viz., that their loyalty to the state is a result of state ownership. This sounds compelling, but in practice is not. The experience of African, Near Eastern, and Latin American journalism reveals that journalists can be muzzled as easily if they work for a private firm, as for one run with tax money; and executive control over the SOBE's budget is actually constrained by domestic opposition. Efforts by state executives to control the SOBE are usually very costly.

The second shortcoming is more empirical: SOBEs are less responsive to consumer demands. That said, I also think the responsiveness of, say, NBC or CNN is greatly overrated.

The zone 1 print media is dominated by "party papers" like the [conservative] Le Figaro or the [leftist] L'Humanitie. Newspapers do not seem to cultivate an identity of "objectivity" in western Europe; however, publications in zone 2 (Germany, the NL, and Nordic countries) like Der Spiegel tend to be distinct from any of the parties or their groupings. I think Germans are more likely to regard their own political party with skepticism, than is the case in France or Italy. My research in this matter suggests that the US print media industry and its spillovers into TV broadcasting, had a fairly important impact on journalistic standards and management in the period 1945-1968. However, the influence was very focused on technique.

After the War, many US journalists wound up serving as educators to the newly restored press corps. The vast majority of US journalists serving in Europe tended to adopt undeniably European sympathies, attacking Washington influence in EU member states. Even conservative Americans tended to find European conservativism more alluring than the US variety. In my opinion, had this not happened, US influence in the affairs of Europe would have remained negligible or net-negative. After 1968, and especially after 1970, the US influence was emphatically anti-Washington. In effect, European journalists were recruited into the US dissent movement.

Since then, the tendency has been for news media in the EU to follow the same path as the US media, from a discreet distance. Despite massive opposition from most grassroots organizations, the state has been eager to sell off public media, probably because most management specialists believe the existence of a private-sector media would make their respective agency more competitive, and absolve the government of making politically unpalatable decisions regarding capital investment and hiring. Political activists seem to have stymied themselves by (a) denouncing the privatization campaigns as "Americanization" and (b) decrying the market penetration of US-origins programming. This seems like the '68ers had a decidedly self-defeating political philosophy that remains a bane of grassroots organizations.

5. STUDENT GROUPS

The group that effected the upheaval of 1968 seems least affected by the events of 1968. That's because the '68ers graduated, and were succeeded by new generations of students. The new students were often inspired by the excitement and illusions of power enjoyed by activists of the day. But the repudiation of order, control, objective standards, or established traditions, also hamstrung them. The pretensions of anarchism and extreme liberty unfortunately ignored the wisdom of durable institutions. By proposing to sweep away what come before, they were proposing the most intrusive scheme for social order ever, and also the one founded on the narrowed basis of support in history. Twenty years later, most understood this; but the 68ers were not very successful at communicating this to their children, either.

The 68ers changed Europe by making innovation, including social innovation, cool. It would be another 20 years before the innovation actually arrived, usually as the students matured into managers and senior politicians. Even subtle transformations made the 68ers ferociously devoted to their own nations, albeit in invisible ways. For example, all social criticism in Europe has a xenophobic twinge; all vices are imported from America. Europeans have no indigenous vices of their own. Irony, likewise, has largely disappeared. In its place is a counterfeit, the facetious contradiction. This, too, has some positive effects; progressive social change makes one "authentically European," ensuring that all political officials need to do is convince the public their agenda are progressive.

But how long before this backfires? The EU has become a quasi-nation, a "project" of nation, where completion is regarded as stagnation. The allure is for the young: Europe the big, the idealistic, the new, the important. It's the older citizens of the continent who have misgivings. Because the EU is not, and never will be, an actual nation, it's a legitimate object of nationalism; it's a repost to the post-war disgust with national nationalisms. In a place where "Europe" is almost a verb, chauvinism toward Europe defeats even recognition. Even the most vociferous "euroskeptics" would deny such a thing exists.

However, I do think student movements are far more thoughtful and sophisticated than the '68ers or subsequent ones have been. The '68ers were a phenomenon, insufficiently coherent to offer any vision at all. Even the usually bright ones were bogged down in absurd or absurdist theories, in love with paradoxes. Unsurprisingly, many took to cults and drugs; paradoxical philosophies are unsatisfying without them. The movement glorified outcasts, but glommed onto prophets and 3rd raters without discrimination. It had unintended consequences, not effects. And those consequences were not of an idea, but the lack of any: the most influential members of a generation were obligated to examine themselves without compelling ideas, and solve the riddle of life's meaning without the assistance of traditions they could take seriously.

In this light, I would say—without any scorn or rancor intended—that the youth of today do stand on the shoulders of prior movements (perhaps of their grandparents; the 68ers are now 55-60 years old). They are less likely to despise the establishment, than to make nuanced distinctions about it. They are less enamored of slogans, and less taken with idealized violence. Also, they are less impressed by the idea of revolutionary change. The concept has been losing its luster for four decades, and I don't think because of reaction; it's because the cruelty of violence is more keenly felt.


ADDITIONAL OBSERVATIONS: While hunting for articles about the May 1968 events in Paris, I found these handy articles:

  • "Ancient Controversy Resurrected," by Nina Lois Turtledove; it's about the centuries-long debate over the role of the university in public life:
    Yet, the university was experiencing some severe growing pains. Before World War II France had about 60,000 students out of a population of 42 million. By 1958 the figure almost tripled to 175,000, and in 1968, at the time of the “May explosion” there were 500,000 students registered at universities, and the population was 50 million. (Singer, 44-45) Within the time span of one generation, the proportion of the population who attended universities went from about 1 person out of seven hundred, to one in one hundred.

    The “tiny elite” was a growing minority, and the university was not only challenged by the multitude of bodies to accommodate, but the additional roles it was required to play in modern times. Economic advancement was underway and the modern capitalist economy was dependent upon technological developments and scientific research to increase productivity. This increased productivity often put people out of work as machine replaced man, and there was a need to continue to add profitable jobs. Capitalism was challenged, as a part of the “system,” to perpetuate itself. For the sake of economic development, independent thought and individual initiative are essential. Yet it is also breeding ground for a critical spirit. (Singer, 42-43)

    Again, as in the medieval times, there appeared significant consequences to the social fabric and the political status quo if the students rebelled. Thus the university needed to be more diverse, more flexible, and more stratified than before. (Singer, 46) It was this that got thrown to the forefront as students rebelled in May 1968.

    I also appreciate Ms. Turtledove's uses of images.
  • "Reading Response - Digital Aesthetics," by Elizzabeth T.;
    In “Space Invaders,” Peter Lunenfeld considers the idea of an “alien aesthetic.” Not having a clear idea of what an alien might be (extraterrestrial, cyborg, illegal immigrant, or other), he determines that the first step in discovering the alien aesthetic is an exploration of the context for this future aesthetic. Lunenfeld explores the politics and art of the twentieth century in the tension between capitalism and communism, and focuses on 1968 and 1989 as particularly important years both politically and aesthetically. Before 1968, for theorists and artists, avant-garde art was utilitarian; it aimed to incite revolution. After the failed student revolution in Paris in 1968, theorists carried that revolutionary spirit into studies of dominant art and media. Critics found “subversive” acts everywhere, whether those acts were truly subversive or not.
    [emphasis added—JRM]
    Art seems to have played a very important role in this episode of European history.
  • "Norman Birnbaum on GERMANY'S POLITICAL CRISIS," at Direland (Doug Ireland, Marxist journalist):
    The coalition of Greens and Social Democrats, led by Green Foreign Minister Joschka Fischer Joschka_fischer (below left) and Schroeder (who was governor of the industrial state of lower Saxony) took office with four major projects. They were "Sixty-Eighters," veterans of the 1968 revolt of the students and the intelligentsia who wished to replace German nationalism with a European cosmopolitanism. That led to emphasis on reconciliation with Poland and Russia, increased developmental assistance to the Third World, an interest in international campaigns for human rights. It also led to the first armed interventions by Germany outside of its borders since 1945—in the Balkans first (Fischer argued that the nation responsible for Auschwitz had a responsibility to intervene militarily against genocide), and later in Afghanistan. It occasioned the present government’s espousal of eventual Turkish membership in the European Union (strenuously opposed by the Christian Democratic and Christian Social parties). It led, too, to German participation in the European Union’s overly discreet but definite support for the Palestinians. Finally, the new German consciousness of international responsibility led to the rejection of the insistent US invitation to send troops to Iraq---and a refusal to allow NATO to become, as it once was, an ancillary of US policy....

    The second part of the Red-Green project was (and remains) cultural and social. Goebbels The rejection of a conception of nationality based on German descent (often quite contortedly described) by access to citizenship for immigrants was a belated triumph for the ideas of 1789.

    The reason so many of my vital sources have been from the extreme left is that this is the most vivid and direct testimony of what the '68ers sought to accomplish.
  • "A Brief History of New Left Review," because it provides a well-written outline of philosophical trends that "passed through" the 1968 "Festival of the Oppressed."


NOTE: 1 "bureaucratizing power": I admit that this is not something I would expect any organization to avoid. Often I refer to decay of this sort as if I was outraged and disgusted by it. In truth, I don't pretend to know how it can be avoided. An institution with power has to devise ways of managing power to achieve intended results. Personally, I think it's necessary for people to understand this happens, and anticipate it. But even this attitude leave much to be desired: anticipate it so one can do what?

Also: I relied in large measure for my info on union activity on "Industrial Relations in France, Italy, and Spain" (PDF), Industrial College of the Armed Forces (1955). This may seem like one of those bizarre choices dictated by google searches, and indeed it is; still, I was quite pleased with it since it consists mainly of testimony by vehemently anti-Communist speakers, who cannot be accused of a Marxist agenda. Yet, it confirms many ugly features of post-war capitalism in Europe.

The testimony of Mr. Daniel Benedict includes mention of the IRI monopoly-cartel system in Italy, plus a crass effort by the US State Department to use offshore (i.e., Italian) procurement contracts to blackmail shops into voting out the Communist management. He refers also to the "GE plan," in which the management would collaborate with a Communist union against the non-Communist union, in order to sterilize a shop of legal union activity.

2 For information on industrial management in Europe pre-1968, I am indebted to Business and Economic History On-Line. This consists of a large number of peer-reviewed articles on very diverse topics. I have been reading monographs from this site for many articles at HC. Also, the Economic History Association hosts an astonishing array of articles on organization. One of these, "The Coevolution of Industries and National Institutions: Theory and Evidence" (PDF-J. Peter Murmann, 2002), was referenced as an abstract, but hosted elsewhere.

The general tendency of European companies was to mimic the feudal organization of the manor; this, even when (or rather, especially when) the product was high-tech and capital intensive, like airplanes and cars.

3 Statistical information on the EU (including future EU member states), while spotty for this period, is available online at Eurostat. I checked the British, German, and French statistical agencies also, and I think Eurostat has everything in one place.