Social Organization

Chapter 23: The Ascendancy of a Capitalist Class

Charles Horton Cooley

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SINCE in our age commerce and industry absorb most of the practical energy of the people, the men that are foremost in these activities have a certain ascendancy, similar to that of warriors in a military age.

Although this sort of men is not sharply marked off, it is well enough indicated by the term capitalist or capitalist-manager class; the large owner of capital being usually more or less of a manager also, while the large salaries and other gains of successful managers soon make them capitalists.

It is not quite accurate to speak of the group in question as the rich, because, at a given time, a large part of its most vigorous membership is as yet without wealth— though in a way to get it—and, on the other hand, mane of the actual possessors of wealth are personally idle or ineffective. The essential thing is a social tendency or system of ideas generated in the accumulation of wealth and having for its nucleus the more active and successful leaders of commerce and industry.


That these are a very small class in proportion to their power is apparent, but not, perhaps, in itself, so fatal a defect in the system that permits it as many imagine. In so far as concentration of control means that wealth is in the hands of those who understand how to use it for the common good, and do in fact so use it, much may be said in its favor. We are all eager to entrust our property to those who will make it profitable to us; and society, under any system that could be devised, must probably do the same. But we may well ask whether there is not some more adequate means than we now have of getting this trust faithfully executed.

For better or for worse, concentration is probably inevitable in any society that has a vast, mobile wealth subject to competition; and the actual inequality is perhaps not much greater than that of political power, which is supposed to be equally distributed by general suffrage. The truth is that equality of power or influence, in any sphere of life, is inconsistent with the free working of human forces, which is ever creating differences, some of which are useful to society and some harmful. A true freedom, a reasonable equality, aims to conserve the former and abolish or limit the latter.

The sentiment of the class is not aristocratic in the ordinary sense. Although its members endeavor to secure their possessions to their children, there is little of the spirit of hereditary caste, which, indeed, is uncongenial to commerce. Freedom of opportunity is the ideal in this as in other parts of American society, and educational or I other opportunities designed to maintain or increase it are

(258) sincerely approved and supported. There is, in fact, an almost inevitable dualism which makes it natural that a man should strive to aggrandize himself, his family and isd class even though he truly wishes for greater equality of privilege. He floats on two currents, and as a man and a brother may be glad of restraints upon his own class which are in the interest of justice.

The ideal of freedom prevalent in the managing class is, however, somewhat narrow and hardly hospitable to the group self-assertion of the less privileged classes. The labor movement has made its way by its energy and reasonableness in the face of a rather general mistrust and opposition—sometimes justified by its aberrations—on the part of the masters of industry. Yet even in this regard, as it comes to be seen that organization is an element of fair play, and as experience shows that union may become an instrument of stability, a broader sentiment makes headway.

Like everything else that has power in human life, the money-strong represent, in some sense, the survival of the fittest—not necessarily of the best. That is, their success, certainly no guaranty of righteousness, does prove a certain adaptation to conditions, those who get rich being in general the ablest, for this purpose, of the many who devote their energies to it with about the same opportunities. They are not necessarily the ablest in other regards, since only certain kinds of ability count in making money; other kinds, and those often the highest such as devotion to intellectual or moral ideals, being even a hindrance. Men of genius will seldom shine in this way,

(259) because, as a rule, only a somewhat commonplace mind will give itself whole-heartedly to the commercial ideal.

There is much likeness in the persons and methods by which, in all ages, the cruder sort of power is acquired. When the military system is ascendent over the industrial it is acquired in one way, when property is secure from force in another, but this makes less difference than might be supposed. In either case it is not mere personal prowess, with the sword or with the tool, that gains large success, but power in organization. Aggressiveness, single-minded devotion to the end and, above all, organizing faculty—these were the methods of Clovis and Pepin and William of Normandy, as they are of our rulers of finance. And now, as formerly, much of the power that is alive in such men falls by inheritance into weaker hands.

As to righteousness, in the sense of good intention, they probably do not, on the whole, differ much from the average. Some may be found of the highest character, some of gross unscrupulousness. The majority are doubtless without moral distinction and take the color of their associates The view sometimes set forth on behalf of men of wealth that riches go with virtue, and the view, more popular among non-possessors, that it comes by wickedness, are equally untrustworthy. The great mass of wealth is accumulated by solid qualities—energy, tenacity, shrewdness and the like—which may coexist with great moral refinement or with the opposite.

As a group, however, they are liable to moral deficiencies analogous to those of the conquerors and organizers of states just referred to. There is, especially, a certain

(260) moral irresponsibility which is natural to those who have broken away from customary limitations and restraints and are coursing almost at will over an unfenced territory I mean that business enterprise, like military enterprise, deals largely with relations as to which there are no settled rules of morality, no constraining law or public opinion Such conditions breed in the ordinary actor a Macchiavellian opportunism. Since it is hard to say what is just and honest in the vast and abstract operations of finance, human nature is apt to cease looking for a standard and to seize booty wherever and however it safely can. Hence the truly piratical character of many of our great transactions. And in smaller matters also, as in escaping taxation, it is often fatally easy for the rich to steal.

It must be allowed that such ascendancy as the capitalist class has rests, in part at least, upon service. That is to say, its members have had an important function to perform, and in performing that function have found themselves in a position to grasp wealth. The great work of the time has been, or has seemed to be, the extension and reconstruction of industry. In this work leadership and organization have been needed on a great scale, and our captains of industry have nobly met this demand. That their somewhat autocratic control of production was called for by the situation seems to be shown by the rather general failure of cooperative enterprises intended to dispense with it. Why is it that America abounds in opportunity, and that every sort of industrial capacity is eagerly sought out and rewarded ? Of course natural advantages play a great part, but much must also be ascribed to the energy

(261) and imaginative daring of our entrepreneurs, many of whom have spent great faculty and tireless zeal upon business, in a spirit of adventure and achievement rather than of gain. Where the general is aggressive the soldier will be kept busy.

I have no sympathy with the general abuse of commercialism, but hold with Montesquieu that "The spirit of commerce is naturally attended with that of frugality, economy, moderation, labor, prudence, tranquillity, order and rule. So long as this spirit subsists the riches it produces have no ill effect. The mischief is when excessive wealth destroys the spirit of commerce; then it is that the inconveniences of inequality begin to be felt." [1]

The conception of keen adaptation of means to ends, of exact social workmanship, inculcated by "business" is of untold value to our civilization and capable of very general application. It is a very proper demand that government, education and philanthropy should, in this sense, be conducted on business principles.

At the same time it is plain that a large part of the accumulation of wealth—hard unfortunately to distinguish from other parts—is accomplished not by social service but, as just intimated, by something akin to piracy. This IS not so much the peculiar wickedness of a predatory class as a tendency in all of us to abuse power when not under definite legal or moral control. The vast transactions associated with modern industry have come very little under such control, and offer a field for freebooting such as the world has never seen.

Nor need we affirm that even the gains of the great

(262) organizers are in the highest sense right, only that they are natural and do not necessarily involve conscious wrong doing.

The question of the rather arbitrary control of industry by the capitalist-manager, which now prevails, and of the possibility of this control being diminished or modified in the future, calls for some analysis of underlying forces Evidently there is a conflict of principles here—the democratic or popular and the autocratic. The latter, now ascendant, has the advantages of concentration, secrecy and promptness—the same which give it superiority in war. On the other hand, the democratic principle should have the same merit in industry and commerce that it has in politics; namely that of enlisting the pride and ambition of the individual and so getting him to put himself into his work. Other things being equal, a free system is more vital and energetic organism than one in which the initiative and choice come from a central authority.

And it is apparent that the working of the autocratic system in our economic life shows just the strength and weakness that would naturally be expected. The prompt undertaking and execution of vast schemes at a favorable moment, and the equally prompt recession when conditions alter; the investment of great resources in enterprises which yield no immediate return; the decision and secrecy important in overcoming competitors; the unhesitating sacrifice of workmen and their families when the market calls for a shut-down of production -such traits as these are of the utmost importance to commercial success, and belong to arbitrary control rather than to

(263) anything of a more popular sort. On the other hand, it would be easy to show at any length desired that such control is accompanied by a wide-spread disaffection of spirit on the part of the working classes, which, expressed in unwilling labor, strikes and agitation, is a commercial disadvantage, end a social problem so urgent as to unsettle the whole economic system.

The autocratic system has evidently a special advantage in a time of rapid and confused development, when conditions are little understood or regulated, and the state of things is one of somewhat blind and ruthless warfare; but it is quite possible that as the new industries become established and comparatively stable, there will be a commercial as well as a social demand for a system that shall invite and utilize more of the good-will and self-activity of the workman. "The system which comes nearest to calling out all the self-interests and using all the faculties and sharing all the benefits will outcompete any system that strikes a lower level of motive faculty and profit."[2] And the penetrating thinker who wrote this sentence believed that the function of the autocratic "captain of industry " was essentially that of an explorer and conqueror of new domains destined to come later under the rule of a commonwealth. Indeed the rise, on purely commercial grounds, of a more humane and individualizing tendency' aiming in one way or another to propitiate the self-feeling of the workman and get him to identify himself with his work, is well ascertained. Among the familiar phases of this are the notable growth of cooperative

(264) production and exchange in Belgium, Russia and other European countries, the increasing respect for labor unions and the development by large concerns of devices for insurance, for pensions, for profit-sharing and for the mate rial and social comfort of their employees. "As a better government has come up from the people than came down from the kings, so a better industry appears to be coming up from the people than came down from the capitalists." [3]

In some form or other the democratic principle is sure to make its way into the economic system. Cooperation, labor unions, public regulation, public ownership and the informal control of opinion will no doubt all have a part; the general outcome being that the citizen becomes a more vital agent in the life of the whole.

Before discussing further the power of the capitalist manager class, we ought to think out clearly just what we mean by social power, since nowhere are we more likely to go astray than in vagueness regarding such notions.

Evidently the essence of it is control over the human spirit, and the most direct phases of power are immediately spiritual, such as one mind exercises over another by virtue of what it is, without any means but the ordinary symbols of communication. This is live, human power, and those who have it in great degree are the prime movers of society, whether they gain any more formal or conventional sort or not. Such, for instance, are the poets, prophets, philosophers, inventors and men of science of all ages, the great political, military and religious organ-

(265) isers, and even the real captains of industry and commerce. All power involves in its origin mental or spiritual force of some sort; and so far as it attaches to passive attributes' like hereditary social position, offices, bank accounts and the like, it does so through the aid of conventions and habits which regard these things as repositories of spiritual force and allow them to exercise its function.

In its immediate spiritual phase power is at a maximum of vitality and a minimum of establishment. Only a few can recognize it. Its possessors, then, strive to establish and organize it, to give it social expression and efficacy, to gain position, reputation or wealth. Since power is not apparent to the common mind until it takes on these forms, they are, to superficial observation and in all the conventional business of life, the only valid evidence of it And yet by the time these symbols appear, the spiritual basis has often passed away. Primary power goes for the most part unseen, much of it taking on no palpable form until late in life, much yielding only posthumous reputation, and much, and that perhaps the finest sort, having never any vulgar recognition whatever.

Regarding money-value we may say, in general, that it is one expression of the conventional or institutional phase of society, and exhibits all that mixture of grandeur and confusion with which nature usually presents herself to our understanding. I mean that its appraisal of men and things is partly expressive of great principles, and partly, so far as we can see, unjust, trivial or accidental. Some gains are vital or organic, springing from the very ~ nature of life and justified as we come to understand that life; some are fanciful, springing from the tastes or whims

(266) of the rich, like the value of diamonds or first editions, an some parasitical, like those of the legally-protect swindler. In general the values of the market are tho of the habitual world in all its grossness; spiritual values except those that have become conventional, being little felt in it. These appeal to the future. The detailed working of market value has no ascertainable connection with moral worth, and we must not expect it to have. If a man's work is moral, in the higher sense, it is in its nature an attack upon the habitual world which the latter is more likely to resent than reward. One can only take up that useful work that seems best suited to him, trying to be content if its value is small, and, if large, to feel that the power over money it gives him is rightly his only in so far as he uses it for the general good.

The more tangible kind of social power—so far as intrinsic to the man and not adventitious like inherited wealth—depends chiefly upon organizing capacity, which may be described as the ability to build and operate human machinery. It has its roots in tact and skill in dealing with men, in tenacity, and in a certain instinct for construction. One who possesses it sees a new person as social material, and is likely to know what can be made of him better than he knows himself.[4]


Of all kinds of leadership this has the readiest recognition and the highest market value; and naturally so, since it is essential to every sort of cooperative achievement. Its possessors understand the immediate control of the world, which they will exercise no matter what the apparent forms of organization may be. In all ages they have gained and held the grosser forms of power, whenever these were at all open to competition. Thus, during the early Middle Age, men of energy and management, more or less favored by situation, built up for themselves local authority and estate, or perhaps exploited the opportunities for still wider organization, like the founders of Burgundy and Brittany and the early kings of France; very much in the same manner as men of our own day build up commercial and industrial systems and become senators and railway presidents.

Indeed, this type of ability was never in such demand as it now is, for the conduct of the vast and diverse social structures rising about us—industrial enterprises, political parties, labor unions, newspapers, universities and philanthropies.

It has its high money value partly because of its rarity and partly because there is a regular market for it; the need being so urgent and obvious as to create a steady and intelligent demand. In this latter respect it contrasts with services, like moral leadership, which people need but will seldom pay for. A third reason is that its possessors are almost always clever enough to know their own value and secure its recognition.

In discussing the power of the capitalist class there is o question of the finer and higher forms of power. We

(268) shall rarely find among the rich any pregnant spiritual leadership, theirs being a pedestrian kind of authority which has a great deal to do with the every-day comfort of their contemporaries but does not attempt to sway the profounder destinies of the race. Nor does the world often accord them enduring fame: lacking spiritual significance their names are writ in water. Even in industry the creative thought, the inventions which are the germs of a new era, seldom come from money-winners, since they require a different kind of insight.

The capitalist represents power over those social values that are tangible and obvious enough to have a definite standing in the market. His money and prestige will command food, houses, clothes, tools and all conventional and standard sorts of personal service, from lawn-mowing to the administration of a railroad, not genius or love or anything of that nature. That wealth means social power of this coarser sort is apparent in a general way, and yet merits a somewhat closer examination.

We have, first, its immediate power over goods and services: the master of riches goes attended by an invisible army of potential servitors, ready to do for him anything that the law allows, and often more. He is in this way, as in so many others, the successor of the nobleman of mediaeval and early modern history, who went about with a band of visible retainers eager to work his will upon all opposers. He is the ruler of a social system wherever he may be.

The political power of wealth is due only in part to dire ct corruption, vast as that is, but is even more an indirect and perfectly legal pressure in the shape of inducements

(269) which its adroit use can always bring to bear—trade to the business man, practice to the lawyer and employment to the handworker: every one when he thinks of his income wishes to conciliate the rich. Influence of this sort makes almost every rich man a political power, even without his especially wishing to be. But when wealth is united to a shrewd and unscrupulous political ambition, when it sets out to control legislation or the administration of the laws, it becomes truly perilous. We cannot fail to see that a large part of our high offices are held by men who have no marked qualification but wealth, and would be insignificant without it; also that our legislation —municipal, state and national—and most of our administrative machinery, feel constantly the grasp of pecuniary power. Probably it is not too much to say that except when public opinion is unusually aroused wealth can generally have its way in our politics if it makes an effort to do so.

As to the influence of the rich over the professional classes—lawyers, doctors, clergymen, teachers, civil and mechanical engineers and the like—we may say in general that it is potent but somewhat indirect, implying not conscious subservience but a moral ascendancy through habit and suggestion. The abler men of this sort are generally educated and self-respecting, have a good deal of professional spirit and are not wholly dependent upon any one employer. At the same time, they get their living largely through the rich, from whom the most lucrative employment comes, and who have many indirect ways of making and marring careers. The ablest men in the legal profession are in close relations with the rich and commonly

(270) become capitalists themselves; physicians are more independent, because their art is not directly concerned with property, yet look to wealthy patients for their most profitable practice; clergymen are under pressure to satisfy wealthy parishioners, and teachers must win the good will of the opulent citizens who control educational boards.

Now there is nothing in social psychology surer than that if there is a man by whose good will we desire to profit, we are likely to adapt our way of thinking to his. Impelled to imagine frequently his state of mind, and to desire that it should be favorable to our aims, we are unconsciously swayed by his thought, the more so if he treats us with a courtesy which does not alarm our self-respect. It is in this way that wealth imposes upon intellect. Who can deny it?

Newspapers are generally owned by men of wealth, which has no doubt an important influence upon the sentiments expressed in them; but a weightier consideration is the fact that they depend for profit chiefly upon advertisements, the most lucrative of which come from rich merchants who naturally resent doctrines that threaten their interest. Of course the papers must reach the people, in order to have a value for advertising or any other purpose, and this requires adaptation to public opinion; but the public of what are known as the better class of papers are chiefly the comparatively well-to-do. And even that portion of the press which aims to please the hand-working class is usually more willing to carry on a loud but vague agitation, not intended to accomplish anything but increase circulation, than to push real and definite reform.


All phases of opinion, including the most earnest and honest inquiry into social questions, finds some voice in print, but—leaving aside times when public opinion is greatly aroused—those phases that are backed by wealthy interests have a great advantage in the urgency, persistence and cleverness with which they are presented. At least, this has been the case in the past. It is a general feeling of thoughtful men among the hand-working class that it is hard to get a really fair statement of their view of industrial questions from that portion of the newspaper and magazine press that is read by well-to-do people. The reason seems to be mainly that the writers live unconsciously in an atmosphere of upper-class ideas from which they do not free themselves by thorough inquiry. Besides this, there is a sense of what their readers expect, and also, perhaps, a vague feeling that the sentiments of the hand-working class may threaten public order.

Since the public has supplanted the patron, a man of letters has least of all to hope or fear from the rich—if he accepts the opinion of Mr. Howells that the latter can do nothing toward making or marring a new book.

The power of wealth over public sentiment is exercised partly through sway over the educated classes and the press, but also by the more direct channel of prestige. Minds of no great insight, that is to say the majority, monld their ideals from the spectacle of visible and tangible success. In a commercial epoch this pertains to the rich; who consequently add to the other sources of their influence power over the imagination. Millions accept the money-making ideal who are unsuited to attain it, and E run themselves out of breath and courage in a race they

(272) should never have entered; it is as if the thin-legged and flat-chested people of the land should seek glory in football. The money-game is mere foolishness and mortification for most of us, and there is a madness of the crowd in the way we enter into it. Even those we must abuse the rich commonly show mental subservience in that they assume that the rich have, in fact, gotten what is best worth having.

As hinted above, there is such a thing as an upper-class atmosphere, in the sense of a state of mind regarding social questions, initiated by the more successful money-winners and consciously or unconsciously imposed upon business and professional people at large. Most of us exist in this atmosphere and are so pervaded by it that it is not easy for us to understand or fairly judge the sentiment of the hand-working classes. The spokesmen of radical doctrines are, in this regard, doing good service to the public mind by setting in motion counterbalancing, if not more trustworthy, currents of opinion.

If any one of business or professional antecedents doubts that he breathes a class atmosphere, let him live for a time at a social settlement in the industrial part of one of our cities—not a real escape but as near it as most of us have the resolution to achieve—reading working-class literature (he will be surprised to find how well worth reading it is), talking with hand-working people, attending meetings, and in general opening his mind as wide as possible to the influences about him. He will presently become aware of being in a new medium of thought and feeling; which may I or may not be congenial but cannot fail to be instructive.


  1. The Spirit of Laws, book v, chap. 6.
  2. Henry D. Lloyd, Man the Social Creator, 255.
  3. Idem, 246. Lloyd was rather a prophet than a man of science, but there is a shrewd sense of fact back of his visions.
  4. Such a one
    "Lasst jeden ganz das bleiben was er ist;
    Er waeht nur druber das er's immer sei
    Am reehten Ort, BO weiss er aller Mensehen
    Vermogen zu dem seinigen zu machen."

    "He lets every one remain just what he is, but takes care that he shall always be it in the right place: thus he knows how to make all men's power his own." Schiller, Wallenstein's Lager, I, 4.

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