The Capitalist State and the Rule of Capital: Problems in the Analysis of Business Associations

This on-line version is the pre-copyedited, preprint version. The published version can be found here:

‘The capitalist state and the rule of capital: problems in the analysis of business associations’, West European Politics, 6 (2), 139-62, 1983.


This paper explore some theoretical problems involved in making an adequate empirical analysis of employers’ organizations and trade associations as representatives of capitalist interests in bourgeois society. It is not directly concerned with determining how much influence specific organizations may have in particular cases but, rather, tries to establish what is involved in asking such questions and whether they can be answered. In this context it criticizes the basic assumptions informing most pluralist, corporatist, and Marxist studies of the interests of capital, the nature of political representation, and the adequacy of policy outcomes to the requirements of capitalist reproduction. It also offers an alternative analytical scheme based on the ideas of competing ‘accumulation strategies’, the problematic unity and efficacy of the state as a system of political class domination, and the contradictory needs of bourgeois reproduction. It concludes with some general remarks on the complex ways in which the forms of capitalism and the state combine to make any general operation of the state in the interests of capital most problematic. But first let us review some other approaches to the topic.


The basic problem confronting any Marxist account of the complex relations between the rule of capital and the modem state is to be found in the very form of the state in capitalist society. For it is not constituted as the private mechanism of the dominant class but as an impersonal public authority and, in so far as it has definite formal channels of representation and accountability, they are typically tied to more or less developed notions of popular rather than class sovereignty. This obviously raises the question of how capital could be said to enjoy political class domination where the state is constituted as a formally impartial, class-neutral authority, is institutionally separate from the productive core of the capitalist economy, and also operates in terms of a political calculus that is quite different from the ‘profit-and-loss‘ accounting of market forces. There is certainly a substantial literature arguing that this question is meaningless because the actions of capital really are subordinate to the rule of law and because political power in the modern state really is exercised by the people through their elected representatives.[1] A growing body of literature also suggests that long-term changes in bourgeois society have made the question historically redundant because economic and political class domination will soon coincide quite obviously. This is supposed to be evident from the accelerating interpenetration of economy and state in the provision of goods and services and in the rising importance of political representation that is based on function in the division of labour rather than individual citizenship.[2] But for present purposes I will examine four other general approaches to this problem. These can be loosely identified as instrumentalism, structuralism, form-determination, and the ‘relational’ approach. I deal with each in turn.

The instrumentalist approach argues that capital rules to just that extent that individual capitalists, particular firms, specific fractions or sectors of capital, or the capitalist class as a whole can employ the state as an instrument to promote their interests at the expense of other classes and social forces.[3] Such control is disclosed through the class background and affiliation of the state elite (comprising career politicians and public employees) and those directly involved in their private capacities in the formulation and implementation of Government policies; and/or through the immediate economic interests advanced by various policies making due allowance for changes during their implementation. In both its sociological and political studies versions the instrumentalist account assumes that the state itself is a neutral tool that is equally accessible in principle to all political forces and can also be used for any feasible governmental purpose. This means that the burden of explanation for any class bias in state policies is placed on the contingent outcome of an open-ended struggle for access to policy-making and implementation. In turn this implies a concern with the differential opportunities for organization and (extra-) organizational influence available to capital, labour, other producer groups, and consumers as well as with the relative plausibility of the policy proposals that they put forward.

There are many objections to the instrumentalist approach but four criticisms are particularly apposite. First, there is wide variation in the social background of politicians, officials, and economic spokesmen as well as a low correlation between social background and position on specific political issues of interest to capital. Second, there are significant areas of conflict between the interests of particular capitals and those of capital in general so that advocacy of a given policy by a specific capitalist interest, or its representatives, provides no proof that it would further the interests of capital in general. Equally there is some evidence that the state must resist too ready an access to particular capitalist interests if its policies are to promote the reproduction of capital as a whole. Third, the instrumentalist account ignores or understates the contradictions and inconsistencies among the requirements of accumulation even at the level of capital in general. The nature of these contradictions and inconsistencies means that it is far from clear whether particular policies can ever be unambiguously favourable to capital. Last, this approach ignores the effects of state forms on the process of representation and the ways in which the interests of capital can be affected and redefined through changes in the state system and/or the balance of political forces within which capitalists must manoeuvre.

‘Structuralist’ analyses focus upon the external constraints that prevent the state elite or state system from pursuing policies contrary to the interests of capital.[4] These constraints are generally rooted in the so-called ‘institutionalized right of capital withdrawal’ that obliges the state elite to govern in the self-professed interests of capital on pain of investment strikes provoked by the competitive logic of market forces and/or politically concerted efforts at destabilization. Such strikes can occur in the private domestic sector, the financing of the public sector, or the underwriting of deficits on the international current and capital accounts; and they may also be accompanied by overt attempts at destabilization through economic disruption. It should be noted that such ‘veto powers” merely reinforce the structurally-endowed privileges that capital enjoys by virtue of the central role of private enterprise and market forces in the overall management and co-ordination of an economic order whose performance is vital to the immediate interests of all members of society. Nonetheless structuralist analyses of this kind must be coupled with an account of ideological class domination. For it is only if capital can ensure that the overriding priority of the state elite is the stabilization of the capitalist economic order that these structural constraints and privileges can prove effective in steering government action. Otherwise investment strikes and destabilization efforts might only result in a gradual or catastrophic economic collapse and/or precipitate demands for an alternative economic order.

There is much to be said for the structuralist approach especially when it goes beyond the notion of ‘business interests as functional constraints’ to include an account of ideological domination. But I must still mention some objections. First, the emphasis on structural constraints not only suggests that accumulation is the overriding priority of the state elite but also implies that the state can always reproduce the complex requirements for accumulation as long as politicians have the will to do so. This approach overlooks the possibility that the state elite might have its own sui generis interests and also ignores the pressures facing them from non-capitalist forces. It also implies that something in the form of the capitalist state somehow ensures the potentially crisis-free realization of the political conditions needed for capitalism to prosper and even assumes that these conditions are essentially consistent rather than potentially contradictory. Moreover, in so far as it is the self-perceived interests of business that engender these constraints, this approach must assume a well-defined course of accumulation whose obstruction will trigger, in quick succession, an investment strike by capital and remedial action by the state elite. Such an assumption overlooks potential contradictions among the needs of capital and fails to perceive the existence of competing accumulation strategies favoured by different business interests. It also neglects the time-lags involved in government attempts at steering the economy and boosting business confidence as well as ignoring the structural limits inherent in such indirect forms of political intervention as changes in the legal and fiscal systems. Finally, in addition to the problems arising from the notion of business interests as functional constraints, one must also note that the ideological domination of business cannot be taken for granted nor reduced to a question of the contingent instrumentalization of the ‘means of mental production’ in the hands of capitalist interests. Ideological domination needs explaining with the same degree of sophistication as political class domination.

One solution sometimes advocated in response to the problems involved in the instrumentalist and structuralist approaches is to look at the so-called ‘structural selectivity’ of the state.[5] The emphasis here is placed on the ‘form-determination’ of state policies, i.e., the manner in which the very structure of the state system itself ensures that the interests of capital are realized in policy-making and implementation. The structural selectivity of the state means that it is not a neutral instrument equally accessible to all social forces and equally adaptable to all ends; instead it has an in-built, form-determined bias that makes it more open to capitalist influences and more readily mobilized for capitalist policies.

Various aspects of the state have been identified in this context. They include its exclusion from the productive core of the economy, which makes it dependent for income on tax revenues or loans generated within the private sector; its rechtsstaatlich form (i.e., a constitutional state based on the rule of law) in which formal equality and freedom before the law serve to reinforce the substantive inequality and economic subordination of wage-labour; the manner in which the effective operation of parliamentary politics and functional representation depends on tacit or open class collaboration within a broad national consensus on the legitimacy of the existing economic order; the way in which its bureaucratic system separates ordinary people from immediate access to administration at the same time as it facilitates access to other bureaucratic bodies representing established interests; the indirectness of legal and monetary forms of state intervention in the economy so that their success depends on compliance by business: and the insulation of the economic and repressive organs of the state from effective popular and legislative control or scrutiny so that state activities crucial to capital will generally escape the influence of anti-capitalist forces. In part this perspective builds on the notion of ‘business interests as functional constraints’ in showing how the form of the state (especially its separation from the economy and its character as a Steuerstaat or ‘tax-state’) reinforce these constraints. But it also attempts to identify more specific features of the state considered as a distinctive institutional ensemble that predispose it to pursue policies favourable to capital and to resist pressures from anti-capitalist forces.

The notion of ‘structural selectivity’ involves a significant advance on the instrumentalist and structuralist modes of analysis.[6] The structural mechanisms proposed need to be specified more clearly, however, especially when their operation depends on complementary forms of political activity. In addition this approach ignores the extent to which ‘form problematizes function’, i.e., the ways in which the form of the state calls into question its effective operation. This issue has been aired recently in criticisms of the adversary system of electoral and parliamentary politics with its purported disruptions in the stable political environment necessary to business confidence. To the extent that such oscillations in state policy do occur, moreover, they are made possible by the institutional separation of the state from the productive core of the economy and the development of political rationalities that can cut across the logic of capitalist market forces. Likewise bureaucracy and its attendant procedures can often be counter-productive for capital as well as the people – which explains why bureaucratism is so vehemently criticized by the representatives of capital. A rigorous analysis would almost certainly reveal other respects in which features of the state supposedly favourable to capitalist control are at best equivocal and at worst positively harmful to the advancement of capitalist interests. Finally it should be noted that this approach assumes a pre-given unity between the capitalist economy and its corresponding state form and suggests that the constitution of capitalist interests and their political representation are essentially non-problematic. But such unity cannot be taken for granted and, as we shall see below, it is far from clear how the interest of capital should be defined in specific situations.

A fourth approach implicit within recent Marxist state theories is more promising. Its basic theme is expressed somewhat obliquely in Poulantzas’s claim that ‘the state is a social relation’.[7] This suggestion can be reformulated in the proposition that state power as revealed in the conjunctural efficacy of state interventions is a form-determined condensation of the balance of political forces. This approach puts the form of the state at the heart of any analysis of political representation and/or state intervention in so far as the complex form of the state as an institutional ensemble shapes and conditions the whole political process. But it also directs attention to the differential constitution of the various forces engaged in struggle within, as well as outside, the state and to the diverse structural and conjunctural factors that determine their relative weight. In this sense the ‘relational’ approach stands at the intersection of the other three approaches and involves modifications in each. It endorses the notion of ‘structural selectivity’ but does not suggest that its effects always favour one class or set of interests. Indeed the complexity of the state system is deemed to be such that its functional unity cannot be taken for granted and any coherence that exists among its activities is supposed to be forged in the face of structural tensions and internal political struggles. This implies in turn that state forms have significant effects on the calculation of political interests and strategies and thus on the composition and dynamic of political forces. These forces may try to use the state but neither they, nor it, can be seen as neutral transmission belts of interests that are fully determined elsewhere in society. Conversely, if state forms and forms of political organization have these effects, it is legitimate for political forces to struggle to change them to their advantage. Finally, in recognizing that ‘politics is the art of the possible’, ‘relational’ theorists also note the importance of extra-political constraints on the exercise of state power. But there is no reason why these should be restricted to ‘business interests as functional constraints’ and they examine the role of structural interdependencies and power relations in other fields too.

Let us now attempt to draw together the basic themes of the different approaches considered above. In criticizing instrumentalism I am not denying that the state can be used to some effect: this is the whole point behind political struggle. But the form of the state gives it certain structural biases and it is important to examine how these affect its accessibility to, and utility for, different social forces. Moreover, whatever the composition of the state elite, its actions are inevitably circumscribed in various ways. These constraints include the institutional separation of the economic and political (which gives rise to ‘business interests as functional constraints’) and the internal structure and social bases of the state system. In this sense one cannot reduce state power to questions of the class background, affiliation, or sympathies of the state elite nor to the various external and internal constraints facing this or that elite. For state power is the form-determined condensation of the balance of political forces and so reflects the interaction between state elite and the circumstances in which it must act. For present purposes the interesting question here is the particular role played by capitalist associations in mediating this interaction.

Few studies ascribe such associations a central role in the exercise of state power in capitalist societies even where the state advances the interests of capital in a particularly unequivocal manner. Does this mean that such interests can be advanced through other instrumentalist channels, that the logic of market forces engendered by the competition rather than association of capitals is sufficient to impose the collective will of capital, or that the undoubted general structural bias of the state is so overdetermined by a specific capitalist bias that capitalist associations are redundant? An adequate answer to these questions can only be provided through a careful analysis of capital and the state. In relation to capital it is essential to define the nature of capitalist interests and the channels by which they are advanced; in relation to the state we need to examine state forms and social bases in more detail. Let us begin with the fundamental problem of capitalist interests.


Capitalism is a system of generalized commodity production characterized by private control of the material means of production (in the sense that there is a multiplicity of formally distinct and formally autonomous centres of production) and by formally free labour-power (in the sense that labour-power itself is a commodity and that labourers are formally free to withdraw their labour-power if the terms and conditions of its sale are deemed unsatisfactory). The basic circuit of capital involves the outlay of money as capital to purchase means of production and labour-power that are then combined in a production process through which value is added (i.e., the socially necessary labour time embodied in the resulting commodities is greater than that embodied in the commodities bought in); this surplus value is then realized through the formally free exchange of the commodities for money as revenue (with revenue including a profit element reflecting the added value); the circuit is completed and also renewed with the re-investment of capital as augmented by part or all of the realized surplus-value. The heart of this circuit is the production process itself (in popular parlance, wealth must first be produced before it can be distributed). This means that the performance of productive, manufacturing capital is the ultimate determinant of capital accumulation and that the real rates of return on money capital (including credit) and commercial capital as a whole depend in the long term on the performance of industrial capital. In turn this depends on its ability to increase productivity and, since added value is realized only through the sale of commodities at appropriate volumes and prices, to ensure the marketability of its products. Owing to the multiplicity of distinct, autonomous centres of production and their output of goods and services in the form of commodities, the co-ordination of the capitalist economy depends on the mediation of market forces and competition. This co-ordination is necessarily post hoc and anarchic in character and, notwithstanding the claims of general equilibrium theories of the market economy, free competition cannot ensure that capitalist economies expand in a crisis-free manner with full utilization of resources.

Given the wide variation in actually existing capitalist economies, it is worth focusing on the fundamental social relation that defines the matrix of capitalist development. This is the value form.[8] It comprises a number of interconnected elements that are organically linked as different moments in the overall reproduction of the capital relation. In the sphere of circulation these elements include the commodity, price, and money forms through which the exchange of goods and services is mediated. In the sphere of production the value form is reflected in the organization of the labour process as a process of valorization (‘value-adding’) and its subordination under competitive pressures to the requirements of reduced costs and/or increased output. In relation to the work force the value form is associated with the transformation of labour power into a commodity, its subordination to capitalist control in the labour process, and its remuneration and reproduction through the wage form. More generally the value form is linked to the law of value. This is the mechanism governing the allocation of labour time among different productive activities according to the fluctuation of market prices around prices of production that reflect the socially necessary labour time embodied in different commodities. In capitalist economies this mechanism is mediated through fluctuations in profits (market price less cost price) and the uncoordinated decisions of competing capitals about the opportunities for profit associated with different patterns of investment and production. These interconnected elements of the value form define the parameters in which accumulation occurs and also determine the sorts of crises that can develop at the economic level in capitalism.

Now, although it is impossible to understand the historical specificity of capitalism without reference to the complex ramifications of the value form, the value form itself does not fully determine the course of capital accumulation. Indeed the very substance of value (the socially necessary labour time embodied in commodities) depends on capital’s ability to control wage-labour in the production process; and this in tum depends on the outcome of an economic class struggle in which the balance of forces is moulded by many factors beyond the value form. Moreover the complex internal relations among the different moments of the value form possess only a formal unity, i.e., they are unified only as modes of expression of generalized commodity production. The substantive unity and continued reproduction of the circuit of capital depends on the successful co-ordination of the different moments within the limits of the value form. But this co-ordination is necessarily post hoe and anarchic (since it is only through the competitive logic of market forces with all their intended or unintended consequences that the essentially private economic decisions and activities of the capitalist system receive any social validation) and there are many points at which the circuit can be broken and economic crises emerge. Moreover, while the possibilities and forms of such dislocations and crises are inscribed in the value form, their actual emergence, timing, and substance depend on many factors extending beyond the value form. These include not only the vagaries of competition among individual capitals and the changing conjunctures of the economic class struggle but also the contingent provision of the various external conditions (such as legal and monetary systems) needed for capitalist production and market forces to operate. In short, although the basic parameters of capitalism are defined by the value form, it is still essential to move beyond questions of form to grasp the nature and dynamic of particular capitalist economies.

The argument so far implies that there is no necessary substantive unity to the circuit of capital nor is there any predetermined pattern of accumulation that capital must follow. In turn this raises a crucial difficulty in analysing the political representation of capital interests. For, if both the substantive unity and development of capitalist economies are indeterminate, how can one establish the interests of capital? At the most general level of abstraction we could perhaps say that the interests of capital consist in the reproduction of the value form along with its various conditions of existence such as law, money, and state. This is clearly implied in the very definition of capitalism and might well seem purely tautological. Even at this level of abstraction, however, several ambiguities and dilemmas are evident.

First, we need to take account of the crucial distinction between capital in general and particular capitals.[9] Capital in general consists in the overall circuit of capital considered apart from the particular, competing capitals through which the circuit is reproduced. Capital in general is a real structure with specific effects but it is not itself an economic agency with powers of calculation and control over production, distribution, or exchange; these powers are exercised only through particular capitals acting within the framework established by the value form. In one sense there is a clear interdependence between capital in general and particular capitals. This is because capital in general cannot be reproduced without the activities of a defined set of particular capitals and particular capitals cannot function outside the economic nexus that is constituted through the circuit of capital. But this interdependence is also problematic. For capital in general needs only some set of individual capitals whose precise composition can change according to the exigencies of competition and, indeed, it may require the bankruptcy or depreciation of some capitals as a condition of its own survival; likewise, since particular capitals are profit-oriented and subject to competitive pressures, they will not undertake unprofitable activities just because they are needed to reproduce capital in general nor desist from profitable activities just because they are deleterious to the overall circuit of capital. In short, although capital in general and particular capitals are interdependent, there are also potential conflicts of interest in their different reproduction requirements.

Second, there is a basic dilemma confronting capital in general in maintaining the value form, namely, the dependence of the value form on forms of social relation that are not organized in value terms.[10] The reproduction of the value form depends on certain general external conditions that provide the framework within which the law of value operates: these include law, a formally rational monetary system, and so on. Moreover it often occurs that certain general conditions of production within capitalism, i.e., conditions whose provision is necessary for the majority of particular capitals to operate, must be provided outside the value form because they would be unprofitable or otherwise impossible for particular capitals to produce. These conditions include not only labour-power in so far as this cannot be adequately reproduced through the wage-form alone but also such conditions as infrastructure, energy supplies, economic statistics, basic research and development, or commercial representation abroad. This poses a strategic dilemma for capital. For, whilst the value form depends to a growing extent on the expansion of non-value forms for its overall reproduction (witness the quantitative increase in state intervention and the acquisition of qualitatively new functions), their very expansion threatens to undermine the rate of accumulation and to cast doubt on market forces as a legitimate mechanism of social distribution. This threat is rooted in the parasitic withdrawal of revenue from directly profitable investment and the emergence of fiscal crises as public expenditure outstrips revenue: it also stems from the politicization of economic relations and the development of alternative, non-market criteria for producing and/or distributing resources. This strategic dilemma is reflected in an irregular oscillation between intervention and retrenchment, between market values and non-market criteria, as one or other horn is considered more daunting. In the long-term this dilemma in insoluble under capitalism and it poses major problems for calculating the interests of capital.

Third, although I have concentrated so far on capital in general and particular capitals as if these comprised only capitalists, it is impossible to understand either without examining their relation to labour-power. This relation is also the site of a strategic dilemma. This can be seen most clearly in the dual character of wages as ‘variable capital’ (i.e., money expended to purchase labour-power as the sole source of added value) and as revenue (i.e., money received as remuneration for labour-power and used to purchase consumer goods).[11] In the sphere of production, capital is interested in minimizing unit wage costs as the concomitant of maximizing surplus value: in the sphere of circulation, capital is interested in rising wages to expand demand and thus to facilitate the realization of the surplus value embodied in its products. At the level of capital in general this constitutes an obvious dilemma and at the level of particular capitals it generates conflicts of interest according to their precise location in the circuit of capital. It should also be noted that the wage-form is not always adequate to ensure the individual, collective, and intergenerational reproduction of wage-labour to satisfy the changing demands of capital and that it may prove necessary to complement the wage-form with non-market forms in order to reproduce labour-power adequately.[12] In either case it is clear that the capital-labour relation is subject to the problems involved in balancing the value-form and non-market forms in reproducing the circuit of capital. Thus we encounter further dilemmas in defining the general interests of capital in this area too.

Finally, we should note that capitalism is a highly dynamic institutional order and undergoes major changes in organization and operation on a continuing basis. This is recognized in various attempts to periodize capitalism into distinct stages and in the continual reorganization of local, regional, national, and international economic relations. This poses further problems in defining the interests of capital – especially in the medium- and long-term. For the continued reproduction of capital in general requires the destruction of economic, political, and ideological structures sustaining the current pattern of capitalist relations and the introduction of new, untried structures that might sustain future patterns. This problem is clearly pertinent to the relationship between declining and ‘sunrise’ industries and services as well as to the more general issue of transition between succeeding stages or patterns of growth.

It follows from these considerations that the interests of capital at the most general level of abstraction consist in the reproduction of a contradictory and ambivalent nexus of value and non-value forms whose reciprocal effects can sustain capital accumulation. The balance among these different forms can be struck in various ways and is subject to a number of dilemmas and difficulties that make this balance unstable and provisional. In this sense the capital relation actually constitutes an indeterminate terrain on which different interests compete to establish a definite course of accumulation. This process is complicated by the ambiguities and tensions in the relation between capital in general and particular capitals. For it is quite reasonable for the latter to promote their own particular interests in a mechanical contestation that merely results in an inconsistent ‘will of all’ rather than a coherent, integrative ‘general will’ that reflects the needs of capital in general. Moreover, since capital in general is not an economic agency, it cannot represent its own interests. This can only be accomplished through particular capitals whose interests happen to coincide with those of capital in general and/or through representative organs that attempt to articulate these interests and defend them against particular capitals whose interests happen to be inconsistent therewith. In the former case there is no guarantee that the particular capitals concerned will always prevail in conflicts to define the course of accumulation, especially as the needs of capital in general are likely to coincide with those of different particular capitals at different times and in different respects. In the latter case the precise status and influence of representative organs that have little or no support from their purported constituents is deeply problematic. These considerations clearly call into question the probability of capital in general securing its long-term reproduction through representative means. Moreover, since I have argued that the simple operation of market forces is also unlikely to secure this result, it is an intriguing question how such reproduction actually occurs.

In this context the solutions proposed by the structuralist and form-determination theorists gain some credibility. For, even if our comments above cast doubt on the adequacy of business declarations about the overall interests of capital, economic crises might still work effectively as a steering mechanism of government and business policies as they disclose where earlier policies have failed to secure these interests.[13] Thus economic crises would enable government and business to break through the opacities and ambiguities of capitalism and establish its needs through remedial action on an experimental, trial and error basis. In this respect the degree of organization of capital and the representatives of business associations would be less important than the urgency and intensity of the specific problems obstructing or disrupting the circuit of capital. Thus the well-organized might have to give way to poorly organized interests where the latter coincide with the interests of capital in general.[14] Moreover, if the state is so structured that the contradictory demands of particular capitals can be aggregated within the state system and thereby made compatible with the needs of capital in general, then the absence or weakness of private economic or political bodies representing these needs would not really matter. In this sense one might see the state itself as the general representative of business interests rather than attributing this role to a private business association.[15]

Although these solutions seem attractive, they must be rejected. If economic crises do sometimes act as a steering mechanism, they are not an automatic pilot. The state responds to the political repercussions of an economic crisis rather than to the crisis as such; and specific interests will no doubt try to interpret its causes and remedies to suit themselves.[16] So one must therefore consider how economic crises affect the balance of political forces rather than focus on economic crises as such. Likewise the state cannot be seen merely as a ‘black box’ that magically transforms the ‘will of all’ into the ‘general will’. Governmental manipulation of contrary and/or contradictory demands might produce a mechanical compromise but it cannot produce an organic solution transcending particularistic demands. This requires leadership and the elaboration of a general economic strategy. In both cases we are therefore forced to examine problems of strategy and their implications for accumulation.

A useful concept here is that of ‘accumulation strategies’. These involve the definition of a specific economic ‘growth model‘, complete with its various preconditions and an outline of the general strategy appropriate to its pursuit. To be successful such a model must unify the different moments in the circuit of capital (money or banking capital, industrial capital, commercial capital) under the hegemony of one fraction (whose composition will depend on the structure of the circuit at a given stage of capitalist development). In this context hegemony should be understood as economic leadership won through elaborating a generally accepted strategy that advances the immediate interests of other fractions by integrating the circuit of capital in which they are implicated at the same time as it secures the economic domination of the hegemonic fraction by giving it a central role in the allocation of money capital to different areas of investment. Acceptance of a particular accumulation strategy does not abolish competition or conflicts of interest among individual capitals or fractions of capital. It does provide a stable framework within which competition and conflicts of interest can be managed without disturbing the overall unity of the circuit of capital.

There is considerable scope for variation in the hegemonic fraction in terms of its primary function in the circuit of capital (banking, industrial, commercial), its mode of accumulation (competitive. monopoly, or state monopoly), and its location in the international economy (national, comprador, multinational).[17] But all such variation is conditioned by the determinant role of industrial capital in the growth of the total circuit of capital. Thus, even if banking or commercial capital enjoys hegemony, this must ultimately be compatible with the continued valorization of industrial capital. This must occur within the nation-state or, in so far as the hegemonic fraction lives off surplus generated beyond its own national boundaries (as might be the case with multinationals), elsewhere within the international economy. Failure to secure the reproduction of industrial capital will lead to a declining mass of surplus value for distribution among all capitals and hence to a general crisis and/or long-run deterioration in the total circuit of capital. This can be illustrated from the British case. For, whereas the hegemony of the City was compatible with industrial expansion in the nineteenth century when international loans could be used to finance the sale of goods produced in the principal ‘workshop of the world’, the rise of American and German industrial capital disrupted this community of interests and the subsequent pursuit of the interests of banking capital helped to provoke the steady de-industrialization of the British economy.[18] Finally we must note that an accumulation strategy should also be linked to the changing balance of forces between capital and labour as modified from time to time by the influence of other class forces. A strategy can be truly ‘hegemonic’ only where it is accepted by the economically subordinate or exploited classes as well as by the non-hegemonic fractions of capital.

In general terms we can say that an accumulation strategy that is not to be merely ‘arbitrary, rationalistic, and willed’[19] must take account of the dominant form of the circuit of capital — liberal, monopoly, or state monopoly; of the dominant form of the internationalization of capital – commercial, banking, industrial; of the specific international context confronting particular national capitals; of the balance of economic forces at home and abroad; and of the margin of manoeuvre entailed in the productive potential of the domestic economy. Within these constraints there will typically be several economic strategies that can be pursued with contrasting implications for the different fractions and dominated classes. This sort of space for conflicts over economic hegemony exists not only for national economies (even supposing these could be completely isolated from the world economy) but also for the integration of the global circuit of capital under the leadership of one (or more) national capitals. Where various national strategies are compatible with the global hegemonic strategy, the conditions will have been secured for accumulation on a world scale.


These general comments can be illustrated in various ways. The role of ‘Fordism’ (based on mass production and mass consumption) is an important element in advanced capitalist economies. Perhaps the most familiar examples of accumulation strategies at the national level, however, are the ‘import substitution’ and ‘export promotion’ growth models developed in Latin America and more recently succeeded by the so-called ‘export substitution’ model.[20] Other national examples include Modell Deutschland, Japanese capital’s efforts to close the industrial and technological gap with the West, and the French planning system in the 1950s. International examples include most obviously the periods of pax Britannica and pax Americana as well as recent proposals for a pax trilateralis and/or a new, international Keynesianism oriented to North-South problems. Strategies such as these clearly merit extended discussion but limitations of time and space dictate that we focus on just one example for the moment. In many respects the political economy of Weimar Germany is especially pertinent.[21]

The German economy under the Weimar Republic was in a paradoxically weak position internationally. It had been the second most productive industrial nation after the USA in the late 19th century and it regained this position in the 1920s. Yet it lacked any corresponding position of dominance in the international economic system because of its lack of colonies, shortage of raw materials, reduced influence in international financial and industrial cartels, reparations obligations, and backward agriculture. Following the hyperinflation of l923-24 and the success of the Rentenmark-based monetary stabilization, there was a period of relative prosperity. This was associated with horizontal and vertical centralization of capital, rationalization of the labour process, and an export-oriented programme of capital investment. It was achieved under the auspices of a coalition government with the tacit support of the social democrats and it depended on an active Sozialpolitik and co-operation between industrial capital and organized labour. The underlying weakness of the German economy was rapidly revealed following the outflow of foreign capital in l928, the worsening reparations payment situation, the collapse of foreign markets in the wake of the Great Crash, and the severe deflationary policies pursued under Brüning. In addition to the structural weaknesses of industry (over-modernization, export-dependence in a weak international conjuncture, high wage costs, etc.), the banking system was also structurally weakened due to the effects of hyperinflation on its capital base, its growing foreign indebtedness, and low levels of liquidity. Finally agriculture was in the grip of a massive structural crisis affecting the Junker estates in particular as well as being hard hit by the worldwide crisis of overproduction in agricultural goods.

There can be little doubt about the dominance of the value form in this period but the disunity and crisis-ridden nature of the circuit of capital is also indubitable. The crucial issue was whether an accumulation strategy could be developed capable of re-unifying the circuit and eliminating the various structural and conjunctural crises affecting the German economy. The first point to note is that there were serious contradictions between heavy industry and export industry, between both industrial fractions and agriculture, and between capital and labour. Any attempt to alleviate one set of contradictions seemed to intensify the other contradictions. Thus, whereas heavy industry (especially coal, iron, and steel) was stagnant, faced high wage costs, and was vulnerable to foreign competition, firms in the metal finishing, electro-technical, and chemical industries were dynamic, enjoyed low unit wage costs, and enjoyed expanding export markets. Protection for heavy industry would harm export industry; free trade would harm heavy industry. Likewise, not only were there splits within agriculture between backward, grain-growing estate owners and a potentially modern, under-capitalized, debt-ridden yeomanry, but agriculture as a whole experienced antagonisms with industry. This resulted from the phenomenon of the price scissors, growing agricultural imports consequent upon the trade treaties negotiated by industry, and disadvantageous access to private loan capital compared with industry. Finally, whereas dynamic, export-oriented industry could live with organized labour and the programme of Sozialpolitik during the period of relative prosperity, with the onset of depression neither fraction of industry could accept the costs of capital-labour co-operation. Yet export-oriented industry also needed the political support of organized labour to promote its export interests in parliament and the administration. Thus, as the depression intensified, there was no economic strategy that could be pursued within the framework of the Weimar Republic that offered advantages to all the dominant class fractions. Structural contradictions, and not merely technical inadequacies, or policy errors committed by the state elite, militated against any such accumulation strategy.

Eventually there emerged a coherent industrial and agricultural policy able to unify the different fractions of capital and the agricultural classes. This was developed within the MWT (Central European Economic Trust) and was premised on the abolition of the Weimar Republic. The strategy involved: cartelizing agricultural production and guaranteeing prices without altering property relations; holding down the costs of production while increasing public spending, especially on armaments, so satisfying heavy industry; and expanding trade, especially in middle and south-eastern Europe, thus benefitting the export industry without setting it against either the rural elite or heavy industry (as would occur if trade expanded with economies directly competitive with these groups). Pursuit of this strategy entailed ‘pacific’ imperialism based on bilateral trade agreements in the middle and south-eastern European countries as a means of constituting an autarkic economic community preparatory to a strategy of ‘military’ imperialism directed towards the Soviet Union. It also presupposed the destruction of the Weimar Republic in order to eliminate the power of organised labour and dismantle the Sozialpolitik system so that industrial costs could be reduced for both fractions of industry.

In contrast with the situation in the USA (where the economic crises were comparable in severity but capitalist interests could not transcend ‘trade association consciousness’),[22] the leading fractions of German capital were eventually able to develop a unified and coherent economic strategy to cope with the structural crises at home and abroad. The role of the MWT as an organization grouping together all these fractions was crucial here. But even so it was impossible to implement this programme through the normal operation of the prevailing political system. The political support for dismantling the Weimar political order was not immediately forthcoming – it had to await the exhaustion of alternative economic strategies favouring one fraction at the expense of others, and the eventual recognition of a coincidence of interest between the newly reconstituted capitalist power bloc and the Nazi Party. It should be emphasized here that capital could not just use the Nazi Party, or the state, reorganized through the Nazi Gleichschaltung (co-ordination) of economic and political order, as an instrument of class domination. Indeed the period of Nazi rule witnessed the destruction of many of the private, autonomous organs of representation of capital as well as bourgeois political parties and the economic and political wings of the labour movement. In addition, although it saw the restoration of profitability and growing domestic and foreign markets, it also involved the partial destruction of the value form. Nonetheless the pursuit of this accumulation strategy (even as mediated through its distinctive Nazi redefinition) was to reinforce the dominance of monopoly capital over competitive capital and petit commodity production, of industrial capital over banking capital, and new, technologically advanced industries over older, heavy industry. It should also be noted that the strategy also achieved a considerable measure of success in its own terms before the German economy was forced to adapt to the exigencies of total war rather than to the conduct of Blitzkriege (short, sharp, lightening wars).[23]

Several important lessons emerge from this brief account and the preceding theoretical discussion. First, I hope to have shown that neither the formal nor the substantive unity of the circuit of capital can be taken for granted, and that it is always necessary to establish how any such unity emerges and is reproduced in specific cases. Second, although it is sometimes argued that individual capitals have no need for organization to define and promote the collective interests of capital (in contrast to the alleged need of individual workers for trade unions to establish and advance the collective interests of labour),[24] the Weimar case shows quite clearly that the collective interests of capital are not reducible to the various interests that individual capitals happen to have in common. Far from these collective interests comprising the lowest common denominator of shared interests in the reproduction of the general external conditions of the circuit of capital (such as money and law), they are not wholly pre-given and must be articulated in, and through, specific accumulation strategies that establish a contingent community of interest among particular capitals. For this reason the interests of particular capitals and capital in general will vary according to the specific accumulation strategy that is being pursued and it is always necessary to identify the strategy serving as a point of reference when discussing the political representation of capitalist interests. This does not mean that the definition of interests is purely subjective because it is clearly possible to miscalculate the effects of particular strategies. Such miscalculation will be evident in the development of crises in one or more moments in the circuit of capital and dictate the formulation of alternative strategies.

Third, confronted with complex structural and conjunctural economic crises with national and international ramifications, different fractions of German capital did indeed propose alternative strategies to resolve these crises. But the contradictions besetting the political economy of Weimar Germany were so entangled that no solution was able to advance the interests of all fractions within existing political parameters. Yet it is often assumed that the peak organizations of capital can somehow represent the interests of all fractions even if this sometimes poses managerial or organizational problems in handling short-term conflicts between particular interests and the general interest. The Weimar case demonstrates that circumstances can arise in which no strategy can be established that merely requires a managerial or organizational solution to this problem. Instead there were important antagonisms that could not simply be glossed over in such a manner.

Fourth, the Weimar case shows how impossible it is to define the interests of capital in isolation from the form of the state, the balance of political forces, and the international conjuncture. For the solution to these antagonisms, and a strategy to advance the collective interests of German capital, had to await the abolition of one state form and the development of a new state form. This is not to suggest that the Nazi state, and the strategy pursued within its framework, were the only possible solution to these problems, but it is to note that they did provide one means of breaking through the previous impasse. Since state forms are significant determinants of capitalist interests, we must consider them in greater detail. This is the task of the next section.


Many analyses of pressure groups treat the means of representation as essentially neutral transmission belts of objective, pre-given interests that simply relay these interests into a different field of action. In the present context, analyses of capitalist associations often reduce the problem of representation to one of how accurately they represent the economic interests of capital in the political system. This ignores two crucial difficulties. Interests are not pre-given but must be defined within the context of specific accumulation strategies. In addition, the means of representation affect the definition of economic interests and are not merely passive or neutral channels for relaying these interests. I have already considered the first difficulty and now turn to the second problem. This involves issues of state form and state power.

State power is a form-determined social relation. This means that an adequate analysis of the capitalist state must consider not only its distinctive institutional form but also how the balance of political forces is determined by factors located beyond the form of the state as such. The most important general aspect of the form of the capitalist state is its particularization, i.e., its institutional separation from the circuit of capital. This is facilitated by the value form in so far as the latter involves the exclusion of extra-economic coercion from the circuit of capital, and its subordination to the logic of market forces as the material expression of the law of value. It is necessitated by the value form in so far as there are certain crucial extra-economic conditions of the circuit that must be secured through an impartial organ standing outside and above the market. At the same time this particularized state form problematizes the functionality of the state for capital. For its very institutional separation from the circuit of capital provides the space for the dislocation between state activities and the needs of capital, as well as for the contingent development of a political programme that corresponds to its needs. Both the value form of the capitalist economy and the particularized form of the state are indeterminate. Thus any correspondence or complementarity between economic and political developments is contingent and must be seen as the product of specific economic, political, and ideological practices.

Simply identifying the state form cannot provide an adequate basis for analysing its structure in detail. We need to investigate three aspects of the state as form: forms of representation, forms of intervention, and the form of articulation of the state as an institutional ensemble.[25] All three aspects are crucial in mediating the rule of capital. Forms of representation shape the ways in which the interests of capital, in a given accumulation strategy, are articulated and, through the ‘structural selectivity’ inscribed in such forms, can privilege some strategies at the expense of others. Different forms of intervention also have differential implications for the pursuit of particular strategies. Finally, the hierarchical and horizontal distribution of powers in the state system, and the relative dominance of specific branches of the state, have significant effects on the exercise of state power in the interests of accumulation.

Along with these formal aspects of the state we must examine its substantive aspects. Here I have in mind not only the specific policies pursued by the state but also two general dimensions: the social bases of support and resistance underpinning the effectiveness of state power and the nature of hegemonic project, if any, around which the exercise of state power is centred. By the social basis of the state I understand the specific configuration of social forces howsoever identified as subjects and organize as political actors that supports the basic structure of the state system, its mode of Operation and its objectives. This is not at all inconsistent with conflicts over specific policies as long as they occur within an agreed institutional framework and an accepted ‘policy paradigm’ setting the parameters of public choice. Such support is not simply a question of an inter-individual consensus of opinion but depends instead on specific modes of mass integration that channel, transform, and prioritize demands and manage the flow of material concessions necessary to maintain the ‘unstable equilibrium of compromise’ that underpins such support. In order to understand the social bases of state power more fully it is necessary to relate them to the prevailing ‘hegemonic project’ (if any) and its implications for the form and content of politics.

In broad terms hegemony involves the development of a specific ‘hegemonic project’ that can resolve the abstract problem of conflicts between particular interests and the general interest.[26] This involves the mobilization of support behind a concrete, national-popular programme of action that asserts a general interest in the pursuit of objectives that, explicitly or implicitly, advance the long-term interests of the hegemonic class (fraction), and that privileges particular ‘economic-corporate’ interests compatible with this programme, whilst derogating the pursuit of other particular interests that are inconsistent with it. Normally hegemony also involves the sacrifice of certain short-term interests of the hegemonic class (fraction), and a flow of material concessions to other social forces mobilized behind the project. It is therefore conditioned and limited by the accumulation process in the circuit of capital. Nonetheless it should be emphasized here that hegemonic projects are not reducible to, nor should they be conflated with, accumulation strategies.

Whilst accumulation strategies are directly concerned with economic expansion on an international or national scale, hegemonic projects can be principally concerned with various non-economic (even if economically conditioned and economically relevant) objectives such as military expansion, moral regeneration, social reform, or political stability. Moreover, whilst accumulation strategies are oriented primarily to the relations of production and, hence, to the balance of class forces, hegemonic projects are typically oriented to broader issues grounded not only in economic relations but also in civil society and the state, and must therefore take account of the balance among all social forces, howsoever these may be identified and organized. It is in this sense that we can refer to hegemonic projects as concerned with the ‘national-popular’ and not just with class relations. These considerations suggest that there is some scope for dissociation and contradiction between accumulation strategies and hegemonic projects. In addition to the cases with the most favourable outcome for capital involving the successful articulation of accumulation strategies and hegemonic projects, one should also note three further interesting possibilities: cases where there is a successful implementation of accumulation strategies in the absence of bourgeois hegemony; cases where the pursuit of accumulation undermines hegemony, and cases where the hegemonic project is contrary to the needs of accumulation. Further discussion of these issues must, however, be deferred to another paper.


Given that the state has both formal aspects and social bases and hegemonic projects that give it some substance, is it possible to specify a state form that corresponds to the interests of capital? Any answer to this question must differentiate among aspects of the state. For, whilst it is possible to delineate the forms of intervention that a state must develop in order to have the means to create, restore, or reproduce the politically-conditioned preconditions of accumulation (without implying that the mere presence of such means guarantees their functionality), it is much more difficult to specify the forms of political presentations that are appropriate to the interests of capital. In part this difficulty stems from the structural selectivity of the state system. For the ‘black box’ constituted by the hierarchy and interconnections among state apparatuses can transform quite varied patterns of inputs and demands into policies whose net impact is favourable to capital. This transformative capacity is also related to the fact that there are multiple points of access, and various channels of representation, and that these can vary in importance for different interests. In part this difficulty stems from the variability of capitalist associations themselves so that there will be more or less need for a significant transformative capacity within the state system. Indeed, the greater the capacity of capitalist spokesmen in civil society to elaborate a coherent accumulation strategy and couple it with an attractive hegemonic project, the less need there will be for a strong, centralized system to act in relatively autonomous fashion for, and on behalf of, capital. For these reasons it is impossible to specify any single state form unambiguously favourable to capitalist interests and instead one must tackle this issue in more complex and realistic ways.

Let us begin by considering the significance of different channels of political representation for the realization of the collective interests of capital. There are obviously many different forms of representation but it will help to focus on three: clientelism, corporatism, and parliamentarism. All three must be considered from the twin viewpoint of how they contribute to articulating the interests of capital in general, rather than promoting the particularistic reproduction of specific interests, and how they contribute to the exclusion or neutralization of anti-capitalist interests and demands. In this sense one must examine the ‘structural selectivity’ of these forms of representation in relation to their class bias rather than any general bias or distortion they may introduce into the political system.

Clientelism may be defined as a mode of representation in which political support is exchanged for particular benefits. It is closely linked to the allocative, distributive, or redistributive role of the state (including licences, legal monopolies, state contracts, subsidies, and so forth) and it is often associated with the development of ‘sponsoring departments or the transformation of regulatory agencies into promotional and defensive organs acting on behalf of the interests they are meant to regulate. Where clientelism is dominant it has at least two major adverse effects on capitalist interests: it generates costly countervailing and mutually contradictory measures intended to satisfy specific interests, and it results in a loss of unity of the state apparatus, and thereby weakens its transformative capacity.[27] Conversely, where there is a crisis of hegemony and/or growing disunity within the state system, the state is vulnerable to particularistic degeneration as it attempts to satisfy specific demand in mechanical fashion. Neither situation can be said to favour the reproduction of capital in general; it is therefore in the political interests of capital to press for the transformation of the state.

Corporatism may be defined as a mode of representation based on functional groupings, and at least in the ideal type case, associated with self-administration through public ‘corporations’ and/or administrative agencies formally accountable thereto.[28] Such a system would seem to be peculiarly advantageous to capital weather it is based on occupational or industrials groups or on the division between capital and labour. For corporatism entitles the political organs of capital and labour to participate directly in formulation and implementation of policies concerned with accumulation, rather than trusting in the mediation of alternative forms of representation and administration. This is particularly crucial when intervention concerns issues that cannot readily be resolved without the co-operation of capital and/or labour; and/or that cannot readily accomplished through rational-legal administrative means. Such issues would include reorganization of the labour process, industrial regeneration, welfare programming, infrastructural provision, incomes policies, and economic planning. One should note here that such activities are not just technical in character but also require the consolidation of political support. Corporatism can function in both respects. For it organizes classes into functionally heterogeneous, politically equivalent communities represented through corporations, and requires their compromise and cooperation as a condition of effective intervention. In turn this implies that the corporations are committed to the overall legitimacy of the existing economic system and confine themselves to demands compatible with its continued expansion. In this context capital is favoured because corporatism is premised on the acceptance of ‘business interests as functional constraints’, and implies that organized labour should see itself as a wage-earning class with an important stake in the existing system, rather than as an exploited proletariat with nothing to lose but its chains. Moreover, in so far as corporatist institutions provide a forum for different functional groups to meet and discuss their common interests, it should facilitate the development of an accumulation strategy that advances the collective interests of capital. In these respects it seems plausible to conclude that corporatism is the most appropriate state form to advance capitalist interests.

But this conclusion would be too hasty. For, depending on its specific organizational form, corporatism can either degenerate into industrial and occupational particularism, or result in splits between the leaders of peak organizations and their memberships. Where corporatism is organized on the basis of multiple industrial or occupational groupings there are major problems in delineating appropriate corporations and assigning them an appropriate political weight.[29] In addition there will be many issues on which specific corporations have no obvious interest and would be willing to trade votes for support on issues directly relevant to themselves. This situation could result in simple particularism or occupational egoism, or else encourage the emergence of power-broking individuals or parties whose activities detract from the declared purpose of functional representation.

Conversely, where corporatism is based on peak organizations representing capital and labour, these bodies are exposed to a permanent organizational and ideological dilemma. Either the leaders of peak organizations compromise the immediate interests of their members for the sake of agreement and thereby run the risk of internal revolt; or they make concessions to their militant members and lose the opportunity for compromises that would materially benefit them.[30] This dilemma is aggravated wherever there are significant material differences between the interests of particular capitals and/or between the interests of different groups of workers. Thus corporatist institutions have often been undermined by the failure of union leaders to control rank-and-file militancy on issues such as incomes policy, rationalization, and the reorganization of the labour process, and/or by the attempts of particular capitals to win a competitive advantage through selective compliance with corporatist economic programmes within the national economy, or through economic activities beyond national borders.[31]

Moreover, since corporatism ideal typically merges organs of political representation and administrative agencies, a crisis of representation has repercussions in the administrative field. Conversely, where functional representation is combined with administration through bodies accountable to other institutions (such as parliament, a dominant single party, etc.), corporatism becomes one element in a hybrid state form and there can be no guarantees that accumulation interests will have primacy. It should also be emphasized that economic issues do not exhaust politically relevant topics, and that extra-economic issues are not readily handled through corporatist institutions and may also generate conflicts that cross-cut economic divisions. In both cases this enormously complicates the efficient operation of a corporatist system and calls into question its ability to secure the political conditions necessary for accumulation. Thus it is interesting to note that pure corporatist states have never existed. Purportedly corporatist regimes have either been bureaucratic, technocratic, or single-party systems (normally the case where functional representation is based on multiple occupational or industrial groups), or else been organized in close association with consociational or social democratic parliamentary representation (normally the case where functional representation is based on the division between capital and labour).[32] This suggests that corporatist institutions are not themselves well adapted to the articulation of accumulation strategies and hegemonic projects and depend on other agencies and organizations for their operational unity.

Finally let us consider parliamentarism and capitalist interests. Parliamentalism may be defined as a system of representation based on the suffrage and related political rights enjoyed by individual citizens who participate in policy-making indirectly through the election of members of legislative assembly and/or through the exercise of their rights of free speech, association, etc. In modem conditions political parties and pressure groups have a crucial mediating role in such systems and the parliamentary regime is typically pluralist, rather than individualist, in character. Where the franchise is not restricted or stratified in terms of property or other economic qualifications, there would seem to be few immediate advantages for capital in parliamentarism. For the outcomes of competitive party elections are inherently underdetermined at the level of electoral and party forms, and there can be no guarantee that parties favourable to capital in general will be elected. Any advantages accruing to capital must be found in the legitimatory effects that might stem from a popular mandate for a government whose activities are otherwise restrained by ‘business interests as functional constraints’ and/or in the individuating or at least pluralizing impact of citizenship on dominated classes.[33] Beyond this the advantages of parliamentary representation for capital are contingent on the nature of the parties elected to office. Further benefits can perhaps be identified in the form of intervention typically associated with liberal parliamentarism, namely, a system of rational-legal administration according to the rule of law. This permits the smooth operation of the administrative branch while changes occur in the balance of forces in the representational field, and thereby provides a stable, calculable environment for business. This is particularly appropriate during the phase of liberal, competitive capitalism, when the state’s principal role is to secure the general external conditions of production, and to restrict the more harmful effects of laissez-faire production through general legal or bureaucratic intervention. Moreover, in so far as this maintains the separation between state and economy, it also reinforces the structural dependence of the state on continued capital accumulation. But even these advantages are attenuated where the state adopts a more interventionist and discretionary attitude. For this opens the door to political struggles and ad hoc administration, and thus weakens the calculability of the political environment.

We appear to have reached an impasse in the analysis of the capitalist state and the rule of capital. It seems both that the interests of capital in general cannot be identified outside the framework of historically specific accumulation strategies; and that there is no state form that can serve as an unambiguously favourable political shell for advancing these interests. This means that there is no abstract theoretical solution to the question of how the political class domination of capital is secured: the answer must be found at the level of specific conjunctures in terms of the complex interaction between the circuit of capital, accumulation strategies, state forms, and the balance of political forces. In my concluding remarks, therefore, I return to the problematic role of capitalist associations in mediating the contingencies of class domination.


There is little organizational or functional homogeneity among capitalist associations. At most an analysis focusing exclusively on such organizations could be expected to produce a series of more or less arbitrary typologies and/or a set of empirical generalizations of greater or lesser scope and determinacy. This may be useful in developing a sociological account of organizations or refining typologies and generalizations in the analysis of pressure group activities. It would not be much help in advancing a theoretical or empirical understanding of the mechanisms of political class domination in capitalist societies. The categories necessary for such an analysis are couched at very different levels of theoretical abstraction and have only a contingent relation to the field of capitalist associations and their activities.

Thus, once we accept the potential non-identity of the interests of particular capitals and capital in general, the relative success or failure of particular capitalist associations has only a contingent bearing on capital accumulation and political class domination. Moreover, once we accept that the interests of particular capitals, and of capital is general, can only be harmonized within the framework of specific accumulation strategies, it follows that these contingencies can only be explored through the prior identification and evaluation of such strategies in the light of prevailing accumulation possibilities. Again, once we recognize the organizational and managerial dilemmas confronting capitalist associations (especially peak organizations) in promoting anything beyond the interests that particular capitals happen to have in common for the moment, it is quite reasonable to expect other agencies to be the key forces in the elaboration of accumulation strategies. The ‘organic intellectuals’ of capital[34] could well be found instead among financial journalists, engineers, academics, bureaucrats, party politicians, private ‘think tank” specialists, or trade union leaders. This suggests the need to consider how accumulation strategies acquire hegemony within the capitalist class, and to examine the consequences of a lack or crisis of a hegemonic accumulation strategy. Such investigations could include capitalist associations but would not be exclusively concerned with them.

A further series of problems is centred on the articulation between accumulation strategies and state intervention. This involves the issue of how best to investigate state power. We have already indicated that state power should be considered as a form-determined condensation of the balance of political forces. This highlights the need to consider how accumulation strategies are represented within the state system and whether or not they are articulated with hegemonic projects able to consolidate support behind these strategies. It would also be necessary to determine the forms of state intervention required by the prevailing accumulation strategy and their likely effectiveness in specific conjunctures. Finally it will be necessary to consider the structural constraints and social resistances within and at a distance from the state system. Accumulation strategies, as we have argued above, involve more than a solution to technical problems. They also involve the mobilization of political support and this takes the analysis well beyond the narrow terrain of capitalist associations.

These concluding remarks are preliminary rather than final and definitive. For the present paper has been largely concerned to clear the ground for an analysis of capitalist associations and the rule of capital rather than offering such an analysis. Much theoretical work remains to be done but concrete studies are also urgently required. It is only through movement between these forms of enquiry that a sound understanding of capitalist associations can be developed.


[1] For a critique of this approach, see: B. Jessop. ‘The Democratic State and the National Interest’, in D. Coates and G. Johnston (eds), Socialist Arguments (Oxford: Martin Robertson 1983), 82-106.

[2] For a critique of such neo-corporatist accounts, see B. Jessop ‘Corporatism, Parliamentarism, and Social Democracy’, in P.C. Schmitter and G. Lehmbruch (eds), Corporatist Intermediation

(London: Sage. 1979), 185-212.

[3] Instrumentalist analyses are so common that one is faced with an embarras de richesse in choosing which works to cite; an influential study, albeit one that combines instrumentalism with structuralist tendencies, is R. Miliband, The State in Capitalist Society (London: Weidenfeld & Nicolson, 1969).

[4] Structuralist analyses are by no means confined to Marxist theorists; indeed, as David Marsh shows in the first article to this volume, pluralist theorists can adopt such an approach. See C.E. Lindblom, Politics and Markets (New York: Basic Books. 1977), pp. 161-236.

[5] I owe the phrase ‘business interests as functional constraints’ to an unpublished paper on the organization of business interests written by W. Streeck, P.C. Schmitter, and A. Martinelli and presented at the workshop on ‘Employers Associations as Organisations’. IIM, Berlin, 1979.

[6] The concept of ‘structural selectivity’ was first introduced by Claus Offe, ‘Structural Problems of Capitalist State’, in K. von Beyme (ed.), German Political Studies, vol. l (London: Sage, 1974), pp. 31-57: for other studies that adopt this approach, see: B. Jessop, The Capitalist State: Marxist Theories and Methods (Oxford: Martin Robertson, 1982), pp. 78-141 and 164-65.

[7] See, for example, N. Poulantzas, State, Power, Socialism (London: NLB, 1978), passim; for a more extended discussion of Poulantzas’s work, see: Jessop, The Capitalist State, pp. 53-91 (and, after the publication of the present paper in 1983, Jessop, Nicos Poulantzas: Marxist Theories and Methods, Basingstoke: Macmillan, 1985).

[8] The following comments on the value form are heavily indebted to two works: D. Elson (ed.). Value: the Representation of Labour in Capitalism (London: CSE. 1979), especially Elson’s own article, ‘The Value Theory of Labour’, pp. 115-80; and M. ltoh, Value and Crisis (London: Pluto Press. 1980). Nonetheless, in compressing and simplifying their arguments for the current paper, I have modified their language and have introduced some differences of interpretation. For further discussion, the reader is urged to consult the above works.

[9] The distinction between capital in general and particular capitals was introduced by Marx and played a crucial role in the development of his account of the capitalist mode of production. For a discussion of the distinction, see: R. Rosdolsky, The Making of Marx’s ‘Capital’ (London: Pluto Press. 1977), passim.

[10] This dilemma was first analysed at length by Claus Offe, on whose account this discussion draws heavily: see C. Offe. The Abolition of Market Control and the Problem, of Legitimacy’, Kapitaltstate, 1, 1973, and 2, 1973; see also. J. O’Connor, The Fiscal Crisis of the State (New York: St. Martin’s Press, 1973).

[11] The dual character of wages is clearly stated in W. Müller and C. Neusüß, ‘The Social State Illusion and the Contradiction between Wage-Labour and Capital’, Telos, 25, Winter, 1975.

[12] An important discussion of the role of the state in the reproduction of labour-power can be found in A. Aumeeruddy et al., ‘Labour Power and the State’, Capital and Class, 6, 1978; see also. S. de Brunhoff, The State, Capital, and Economic Policy (London, Pluto Press, 1978).

[13] The idea that economic crises act as a steering mechanism was proposed by M. Wirth, ‘Towards a Critique of the Theory of State Monopoly Capitalism’, Economy & Society, 1977, and developed by J. Hirsch, ‘Bemerkungen zum theoretischen Ansatz einer Analyse des bürgerlichen Staates’, Gesellschaft, 8-9, 1976.

[14] Cf. S. Clarke, ‘Capital, Fractions of Capital, and the State’, Capital & Class, 5, 1978.

[15] Indeed Poulantzas once argued that, if the Leninist vanguard party should be seen as the political party of the working class, the capitalist state should be seen as the political party of the bourgeoisie: cf. Political Power and Social Classes (London: NLB, l973), pp. 299-300.

[16] The idea that the state reacts to the political repercussions of economic crisis is derived from the work of Hirsch: for a discussion of his ideas, see: Jessop, Capitalist State, pp. 101-06.

[17] The best discussion of the periodization of capitalism and the international development of capitalism is found in B. Fine and L. Harris, Re-Reading Capital, (London: Macmillan, 1979).

[18] For further discussion, see: B Jessop. ‘The Transformation of the State in Postwar Britain in R. Scase (ed)., The State in Western Europe (London: Croom Helm, 1980), pp. 23-94.

[19] The phrase is Gramsci’s, A. Gramsci, Selection from the Prison Notebooks (London, Lawrence & Wishart, 1971), pp. 376-77.

[20] On ‘Fordism’, see: M. Aglietta, A Theory of Capitalist Regulation (London: NLB, 1979); and on ‘export substitution’, see: A. Lipietz, ‘Towards Global Fordism?’, New Left Review, 132,1982.

[21] The following account is largely parasitic upon two works: A. Sohn-Rethel, Economy and Class Structure of German Fascism (London: CSE, 1979), and the magisterial work of D. Abraham, The Collapse of Weimar Republic (Princeton: PUP, 1981); in addition, see K. Hardach, The Political Economy of Germany in Twentieth Century (Berkeley, University of California Press, 1980).

[22] The notion of ‘trade association consciousness’ is used by T. Skocpol, ‘Political Response to Capitalist Crisis Neo-Marxist Theories of the State and the case of the New Deal’, Politics and Society, Fall, 1980, pp. 155-201 (at p. 166).

[23] On the war time Nazi economy, see: A. Milward, War, Economy and Society (London: Allen Lane, 1973), passim.

[24] This view has been proposed by Offe and Panitch: see C. Offe, ‘The Attribution of Public Status to Interest Groups’, in S. Berger (ed.), Organising Interest in Western Europe (London; CUP. 1981). pp. 123-58, especially pp. 146-8; and L. Panitch, ‘Trade Unions and the State’, New Left Review, 115, 1981. pp. 22-23 and 42.

[25] These three formal aspects of the state are discussed in greater detail in Jessop, Capitalist State, pp. 228-41.

[26] The concept of ‘hegemonic project’ elaborated below differs from that in my work on The Capitalist State in so far as it distinguishes between ‘accumulation strategies’ and ‘hegemonic projects’ whereas the earlier analysis conflated them in an unwarranted economistic fashion.

[27] A useful discussion of the relation between clientelism and state forms is found in S.N. Eisenstadt and L. Roniger, ‘The Study of Patron-Client Relations and Recent Development in Sociological Theory’, in S.N. Eisenstadt and R. Lemarchand (eds)., Political Clientelism, Patronage and Development (London: Sage, 1981), pp. 271-96.

[28] The ideas in this paragraph draw on my earlier piece on ‘Corporatism, Parliamentarism, and Social Democracy’, see note 2 above.

[29] The problems of corporatism based on multiple industrial or occupational groupings are surveyed in an impressive review by J. Linz, ‘Totalitarian and Authoritarian Regimes’, in N.W. Polsby and F. Greenstein (eds), Handbook of Political Science vol. 3 (Reading, Mass: Addison-Wesley, 1975), especially, pp. 308-11.

[30] This dilemma is stated forcefully in G.D. Feldman, ‘German Interest Group Alliances in war and inflation, 1914-1923’, in S. Berger (ed)., Organizing Interests in Western Europe, pp. 159-84, at p. 181.

[31] Cf. Jessop. ‘Corporatism, Parliamentarism, and Social Democracy’, p. 201.

[32] For multiple group corporatism, see: Linz. ‘Totalitarian and Authoritarian Regimes’, p. 311; for bilateral corporatism and tripartism, see: G. Lehmbruch, ‘Liberal Corporatism and Party Government’, in Schmitter and Lehmbruch (eds), Trends Towards Corporatist Intermediation; Jessop, ‘Corporatism, Parliamentarism, and Social Democracy’; and Panitch, ‘Trade Unions and the State, New Left Review, 125, 1981, pp. 40-41.

[33] For further discussion, see B. Jessop, ‘Capitalism and Democracy: the best possible political shell’, in G. Littlejohn et al. (eds)., Power and the State (London: Croom Helm, 1980), pp. 10-51.

[34] The notion of ‘organic intellectuals’ comes, of course, from Gramsci; see his Prison Notebooks, pp. 5-23, 60-61, and 289-94.


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