Real and imaginary bourgeoisies

Issue: 106

Claudio Katz

A strategic project of the Argentine government of Nestor Kirchner is “the reconstruction of the national capitalism”. It naturally gets the approval of the financiers and industrialists of the country. But many “progressive” Argentine intellectuals also support this objective. They do not explain how the recomposition of a system that oppresses the people might benefit the majority of them. Capitalism – in its extreme version known as neoliberalism —is the origin of the social tragedy that Argentina is suffering.

The spokespeople for this “progressivism” consider that “another capitalism” can be obtained by “recreating a truly national bourgeoisie” and that this would be beneficial. They counterpose to the existing model of bourgeois accumulation the one in force during the years 1950 to 1970. But aren’t the existing dominant class the heirs of the preceding bourgeoisie? Is the discontinuity between the two groups so significant?

Members, composition and nationality

If the term “national bourgeoisie” is used to describe the big local owners of the means of production, it portrays the capitalist class of the past and the present. This is a bloc made up of distinct fractions that control the Argentine economy. Certain economic policies favour the hegemony of one segment to the disadvantage of another, but this supremacy is never definitive. If convertibility [when the Argentine peso was tied to the value of the US dollar] favoured the groups linked to the privatisations and the public debt, devaluation helped those sectors which exported or provided substitutes for foreign imports.

The composition of the dominant block changed in the last three decades, but the rise and decline of enterprises took place within the same framework of capitalist organisation. Some firms maintained their position (Perez Companc, Pescarmona. Loma Negra), others lost importance (FATE), and some grew rapidly (Macri, Arcor, Roggio). Association with foreign groups and the movement of capital abroad modified the nationality of many enterprises. But these processes did not alter the territorially located character of the bourgeoisie. Argentina constitutes the operational base and the principal – or very important – source of profits for the majority of firms. Although they keep for than 80 billion dollars outside Argentina, they tend to move funds in an out of the country in a cyclical fashion, according to the demands of profitability. During the firsts half of the nineties they brought in money in order to participate in the privatisations, and in the following five years they sold their shares and moved their money abroad. At present they are again repatriating funds in order to acquire things that have been cheapened by devaluation and to increase their wealth with the reactivation of the economy. These fluctuations prove that the country constitutes the central reference point for their businesses. Although they invest in other regions (Latin America, Central Asia) and have linked up with foreign partners (Techint), the majority of companies are not involved in processes of merger on a continental scale (as in Europe) and neither do they limit themselves to being mere financial intermediaries (as is the case in the Caribbean).

The local groups have lost ground to foreign firms in the domestic market. They share with foreign capitalists the profits arising from the exploitation of the workers and operate under the same IMF supervision as the international corporations. But this economic retreat and political intertwining has only weakened the presence of the national bourgeoisie, which is far from being extinguished.

“Oligarchy” and “class consciousness”

Many Argentine economists consider that the dominant bloc forms a “new oligarchy”. But this old term—that used to be used to describe the great landowners – is not applicable to the present economic groups. These sectors are not passive rentiers, and neither can they avoid competitive investments.

They certainly get involved in activities of an “adventuristic” sort. But such conduct is not incompatible with belonging to the national bourgeoisie, since this has always included Mafiosi and members of the state elite. The “responsible entrepreneur” is in fact in decline right across the world, as is shown by the recent cases of Enron and Parmalat. Neither does the “diversification” of business constitute an oligarchic feature since shifting activities in pursuit of profit is a current way of compensating for risks.

Argentine company chiefs have a predilection for “financial speculation”. However, this inclination is not some ideological peculiarity, nor does is prevent them belonging to the bourgeoisie. The speculative option (1985-89 or 1998-2002) habitually proceeds or follows stages of giving preference to industrial activity (1990-95 or since 2003).

Not even its “prebendary” character [its profiting from a privileged position] puts this group outside the orbit of the national bourgeoisie, since dependence on public subsidies is not a peculiarity of the last three decades. The state has sponsored at different stages since the second world war import substitution, developmentalist protectionism, “promotion of industries” and “competitiveness plans”. Such mechanisms point to the rise and persistence of the Argentine capitalist class.

The interpretation of other analysts is that the local business leaders are “neither bourgeois nor national” since “they lacked class consciousness” in selling their factories to “financial or foreign outsiders”. But have they recovered this consciousness every time that capital flows back in to do business inside the country? Such an attribute cannot disappear and reappear with such frequency.

The objective criterion of ownership is the more adequate for characterising a dominant class than subjective interpretations of its behaviour. But even igf you adopt this second criterion , it becomes clear that the local capitalists have always acted in defence of their own interests. They did so by shoring up the military dictatorship and the governments that followed it. If the results of this policy may have been unfavourable in comparison with other national bourgeoisies (Chile, Brazil, South Korea), this is not a product of a “lack of class consciousness” , but the outcome of competition. If some capitalists advance on the world market, other necessary must lose out, and the Argentine bourgeoisie has found itself in this losing camp.

Territories and projects

The disappearance of the “national bourgeoisie” is a conclusion frequently drawn by the theorists of “Empire”. They suppose that the “deterritorialisation of power” has pushed the capitalists classes of the periphery into integrating into a new transnational domination which is taking the place of the old rivalry between powers.

But what contemporary episode provides confirmation of this rule by a supernational empire? For example, are US troops occupying |Iraq in the interests of “universal capital” or of the US companies that are competing with European firms? The homogenous transnational universe is as imaginary as the dissolution of the central and peripheral capitalist classes into an indistinct group.

While various US corporations control key sectors of the Argentine economy, no Argentine business figure has influence over the American productive process. Certainly, competition has changed and alliances are very different than they were in the inter-war years, but these continue to be established under the influence of distinct state apparatuses. A struggle between horizontal associations of the type of the “Perez Companc-Exxon versus Technit-Texaco” is a pure fantasy.

Continued imperialist domination recreates frequent clashes between the international corporations and the bourgeoisies of the periphery. The dispute around the Free Trade of the Americas is just the most recent example. If the capitalists of the Third World had disappeared, there would not exist divergences over tariffs between US exporters and local industrialists.

Starting from a completely different conception, another approach identifies the extinction of the dependent bourgeoisies with the absence of “national projects” comparable to import-substitution industrialisation of the post war years. But the undoubted abandonment of this programme only shows that the advance of internationalisation modifies the priorities of the capitalists of the periphery, without them ceasing to function as a social group.

As world capitalism develops through polarisations, inequalities and regional fractures, attempts to national autonomy tend to reappear periodically. In the nineties, these attempts lost force in Latin America, but not in the Asian economies. And since the dominant classes have not wished to be fully assimilated by recolonisation, the “national projects” are being revived in Latin America as well.

But the experience of a century show that these attempts appear, fail, revive and again decay. This dynamic reflects the structural weakness and oscillating behaviour of the national bourgeoisies which are pushed to look for relief form their marginal place in the world market.

Not understanding this contradiction leads to two symmetrical mistakes: to overestimate the strength of this sector in the periods of euphoria and to imagine its extinction in periods of retreat.

Dilemmas and options

The logical corollary of all the interpretations of the “end of the national bourgeoisie” must be the unviability of any programme of national capitalism in the periphery. :However, very few of the defenders of the thesis come to this conclusion. On the contrary, the majority argue for substituting some version of “regulated capitalism” for the neoliberal model. But if the central subject of this mode of production has disappeared, who would take charge of this system and who would appropriate its profits? At the most, a bureaucracy could run that regime, but a national capitalism without local business chiefs is a contradiction.

For this reason, all the governments that back that project prop up already constituted sectors of the bourgeoisie. In the Argentine case, far from fantasising about the creation of another bourgeoisie, Kirchner is strengthening the existing capitalists. Those pleased with this policy are the well known beneficiaries of the state taking over private business debt and of state subsidies. To hide this support for the bourgeoisie as a whole, the Argentine president lets lose periodic verbal broadsides against the discredited groups (Macri, the privatised enterprises, AFJP).

Those who ignore this reality, waiting for the mythological rise of “another bourgeoisie”, should also consider another problem: What sense is there is contributing to the erection of an exploiting class? It is logical for bankers and industrialists to follow this course. But intellectuals who share the popular desires: shouldn’t they come down in favour of an alternative of the workers?

The enterprises put back into operation by the workers provide a concrete example of this disjuncture. What should be the next steps? Return the firms to the Zanon or Brukman, or hand them over to some other exponent of the national bourgeoisie? The workers have opted for a much more correct road: to move to non-capitalists forms of ownership and administration. Thie other way involves the traditional delegation of power to the dominant classes.

It has often been argued that this form of subordination has been necessary in a dependent country affected by “the principal contradiction between imperialism and the nation” and characterised by an opposition between the “national bourgeoisie and retrograde foreign capitals”. But this reasoning—which idealises the local business chiefs and washes away social antagonisms – gave rise to expectations in Alfonsin, Menem and De la Rúa which blocked the development of a real option from the left.

Support for the capitalist project of Kirchner, which is often justified by gambling on the evolution of the present economic model to one that is more generous, leads to the same frustration today. No one can foresee what will be the final direction of the government, but experience shows that political support of such a sort shackles the popular movement, impedes it from working out its own option for power and pushes the left towards self destruction.

The conjuncture is a favourable one for imposing social and political conquests and for advancing along an independent road. With Kirchner, the dominant classes have re-established political stability and economic growth, but have neither retaken social control nor deactivated popular protest. The revival of mobilisations has pushed the government into a defensive, temporising posture. Neither repressive threats nor the official delegitimising of occupying the streets have stopped the social struggle.

But the genuine advance of the left requires a strategic definition of opposition to “national capitalism”, since our project is equality, liberty and emancipation, that is to day, socialism.