Policy-planning organizations and capitalist support for industrial policy, 1970--1984

Studies by critical sociologists of the economic policy debates of the 1970s have shown how the free market policy shift that occurred during that period was brought about by a mobilization of business elites working through policy-planning organizations such as the Business Roundtable and American Enterprise Institute. Less attention has been given to an alternative, state-interventionist strategy that was advanced by some corporate elites for dealing with the economic crisis of U.S. capitalism. Industrial policy—coordinated and systematic government assistance for selected firms and industries—was a major component of this alternative elite strategy for revitalizing the economy. While industrial policies have long been used by Japan, France, and other advanced capitalist countries to promote the international competitiveness of key industries and facilitate adjustment by industry to changing economic conditions, the U.S. has lacked a coherent program of government intervention to shape industrial development (with the important exception of the defense program which, however, is not primarily or explicitly aimed at civilian industry).; This dissertation examined support by corporate elites for industrial policy during the 1970s and early 1980s, using a framework drawn from the power structure research tradition, particularly the theories of the “inner circle” of corporate elites (Useem 1984) and the policy-formation process (Domhoff 1983). Power structure researchers have argued that an inner circle of business executives has emerged whose position at the center of networks of interlocking directorates has led it to develop a classwide rationality and the capacity to act as a leadership segment of the capitalist class. It is within the network of policy-planning organizations that the inner circle, with the aid of experts, elaborates and debates different strategies for pursuing the general interests of the capitalist class, which become the basis for recommendations for government action.; This study found that support existed for industrial policy within the inner circle, though this was a minority position within the U.S. capitalist class. The Council on Foreign Relations (CFR) and Trilateral Commission, key policy-planning organizations, were sources of strong support for industrial policy, and were able to place industrial policy on the agendas of national administrations. In this they diverged from other central policy organizations, principally the Committee for Economic Development and the Business Council and its lobbying arm, the Business Roundtable, which opposed industrial policy. The corporate elites linked to the CFR and Trilateral Commission are examined, along with the content of specific industrial policy proposals.