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Issue #19, Winter 2011
Enemies of State
First Principles: The Role of Government
Rick Perlstein
The techniques Boulware developed to achieve his goals were extraordinary and innovative. He convened what would later be known as “focus groups,” not only of the union members he was seeking to reach but their families, non-union workers, and community leaders like ministers and teachers. He was a craftsman and connoisseur of persuasion, dispensing the fruits of his research in an extraordinary volume of internal publications designed for easy memorization, frequently enunciating the rudiments of Austrian laissez-faire economics; their titles included “How Big Are General Electric Profits–Are They Too Big?” and “The Fallacy of Using ‘Ability to Pay’ as a Guide to Wage and Benefit Levels” and “Who Told You These Fairy Tales–Do You Still Believe Any of Them?” The goal was redolent of the ideological warfare at the heart of the famous William Kristol memo: present the company as generous protector. Boulware instructed his Employee Relations Managers, “Be sure we are supplying–are credited with supplying [my emphasis]–the basic material rewards, the extra human satisfaction, and the assurance that good jobs with good pay and other attractions and rewards are the result of our diligent efficiency.” Don’t tell ’em, sell ’em: in this case, a total identification not merely with the corporation but the entire system of competitive enterprise itself.
This was ironic. The high tide of Boulwarism coincided, in the late 1950s and early 1960s, with a series of indictments of General Electric executives in the biggest antitrust conspiracy in the twentieth century. In its essence, the scandal was a series of interlocking schemes to fix the prices of everything from $2 insulators to those selfsame multimillion-dollar turbines. It arose out of an economic atmosphere, during America’s postwar boom, when the great industrial giant was facing genuine competition in its various business lines for the first time in company history. The men who ran GE, according to one of their historians, took “a dim view of competition.” They also, at the very same time, took a dim view of what GE CEO Ralph Cordiner called “fantastically growing federal government,” “excessively high taxes,” and–that word again–“demagogues” in government “who are hunting for votes regardless of the economic and social consequences.”
The droit du seigneur thus revealed is highly significant: subverters of competitive enterprise arrogating themselves the right to define the meaning of competitive enterprise. The size of General Electric’s activist ambitions, meanwhile, radiated outward over time: reaching deeply into the culture of the cities in which its plants were emplaced (Boulware’s title, recall, was vice president for public and community relations); politically educating stockholders (Cordiner and Boulware were credited with coining the term “investor relations”); and guiding the entire citizenry responsible for creating, through their wise political behavior, a favorable “business climate” (another General Electric coinage) as against the socializing tendencies of government in cahoots with what Boulware artfully called (excluding the rank-and-filers he was aiming to reach) “the upper-crust of labor.”
And, of course, they hired Ronald Wilson Reagan in 1954. While hosting “General Electric Theater” on television, Reagan traveled to GE factory floors across the country, giving speeches that evolved from Hollywood stories to Boulwarite ideological folk tales: “We have so many people who can’t see a fat man standing beside a thin one without coming to the conclusion that the fat man got that way by taking advantage of the thin one!” As Reagan converted GE’s rank and file to his folksy brand of conservatism, Boulware began in the late 1950s to organize monthly meetings with executives at other corporations on Gasparilla Island, Florida, with the aim of recruiting them, in the quintessentially Boulwarite formulation, “to go to work in their own and the rest of the public’s interest” by promoting “economic education, proper moral conduct under freedom, and political maturity that proofs people against the demagogs.” The spelling–“demagogs”–was borrowed from the anti-FDR ideologue, press baron, and English-spelling reformer Colonel Robert McCormick, who disseminated the political culture of government-hating across the Midwest. Conservative newspapers like McCormick’s Chicago Tribune served as a bridge between the 1928 Chamber of Commerce zealot who led off this essay and the executives who, in the wake of the popular radicalism of the 1960s and oil shocks of the 1970s, followed Boulware in organizing into ever more aggressive anti-activist-government lobbies like the Business Roundtable and American Council for Capital Formation.
Always the Problem, Never a Solution
The danger, however, was always that same lingering plutocratic and extremist taint that took down the Liberty League in the 1930s. It took a Boulwarite to well and truly shake it. The red thread distinguishing anti-government conservatism in our time and all that came before it was the increasing sophistication by which anti-government sentiment severed itself from that taint. The ideology of industrial barons comes no longer to look like the ideology of industrial barons; it becomes popular folk wisdom instead. One word for this development is: “Reaganism.”
One vector, of course, was and continues to be race. In 1966, the year Ronald Reagan first ran for governor, Congress was also debating a landmark expansion of civil-rights law to outlaw discrimination in all private housing. Congressmen received more letters in opposition than they had on any previous issue in U.S. history. Homeowners in places like the Southwest Side of Chicago, where Martin Luther King Jr. marched for housing equality, sent their senators missives asking, “Is the ultimate aim the same as the Soviet Union when all property was collectivized?” Most, however, came not from homeowners but from realtors, in a pioneering effort in business conservatism learning to cover itself in “grassroots.” “Much of the opposition,” The New York Times reported, “was generated by the National Association of Real Estate Boards”–the same organization that circulated half a million copies of Milton Friedman’s 1946 anti-rent control pamphlet–“which has called on its 83,000 members to convince Congress that the proposal is ‘inherently evil and would sound the death knell of the right of private property ownership.’ ”
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ISSUE #19, WINTER 2011
Post a Comment

Susan Webster:
Maybe our country needs a depression or severe recession periodically so that the "average American" is touched by financial hardship and can see how social programs and legislation like the health care bill are necessary parts of our government. But then again I remember reading about one of those "average Americans" voicing her concern about how she didn't want the government to start running social security and mess it up. Would we still be a democracy if voting depended on having an adequate IQ?
Jan 23, 2011, 4:48 PM
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Rick Perlstein is the author of Nixonland: The Rise of a President and the Fracturing of America.
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