The mechanisms of escalation

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More generally, pace Hayek, warfare/military defense, bureaucracy, organization, management, etc. – in short planning – is both historically and logically irreducibly linked to modern capitalist market dynamics (e.g., Weber 1978, 1948: chapter VIII; Sennett 2006: 20-23; Chang 2011: especially 199-209). Arguably, the WW2 case, in particular, reveals (in an extreme manner) the way in which and the degree to which, as argued, states’ generally backgrounded but always already lurking and occasionally fully activated violence-security-sovereignty functions are intricately connected to foregrounded fiscal-functional dynamics.

Looking back, as opposed to both previous and subsequent eras, the Western European (and the US) postwar consolidation period was constituted by a reciprocal and emergent economic configuration simultaneously combining (1) high productivity, exports and investments with (2) a steady-going relatively dispersed growth in real wages (e.g., Eichengreen 2008; Piketty 2014).¹⁷⁸ Arguably minimally somewhat materially underpinned by a generalized basic Keynesian (or ‘Left Keynesian’), and specifically wage/income/consumption-focused, ‘aggregate demand’ perspective (for a theoretical discussion of this perspective, see notably Bhaduri & Marglin 1990), postwar fiscal considerations became increasingly infatuated with the behavior of consumers and the intensity of their preferences (see also more generally Przeworski & Wallerstein 1982: 54-58).

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particularly British empirical sociologists from the 1950s and 1960s, argued that the emergence of the so-called ‘affluent worker’ of the postwar period helped trigger a growing normative and behavioral

‘embourgeoisement’ of the proletariat/working-class – increasing its overall ‘middle-classness’ and

‘political conservatism’ (see notably Goldthorpe et al. 1967: 11, 13).¹⁷⁹

This is of course a particular postwar-oriented version of a classical particularly Marxian-revolutionary observation: Friedrich Engels, in particular, both in letters to Marx and in the preface to his The Condition of the Working Class in England, inter alia complained that ‘the English proletariat is actually becoming more and more bourgeois’ (as cited in Lenin 1916c; see also Goldthorpe et al. 1967:

12). Lenin, in notably his Imperialism, the Highest Stage of Capitalism and particularly his Imperialism and the split in socialism, also provided a distinctive skeptical observation on this matter: imperialist finance-oriented monopoly capitalism allows ‘superprofits’ to accrue to a Western ‘labour aristocracy’

and monetarily ‘bribes’ for example English workers (or certain higher layers of the working-class) into cooperation and enhances self-interested behavior (Lenin 1916a). In Lenin’s (1916a, 1916b) view, rather than necessarily suffering from ‘false consciousness’, the (Western) working-class had a spontaneous, realistic and materialistic orientation (on this, see Eyerman 1981: 45-6), which made it partly understandably susceptical to embourgeoisement.

Besides post-Lenin Marxian thinkers like Lukács and Gramsci, who in particular helped deepen the theorization of ideology and false consciousness (see Eyerman 1981), the above inversion of the orthodox Marxian ‘immiseration’ thesis of course found sublime manifestation in the work of the early Frankfurt school (such as, e.g., Herbert Marcuse’s pessimistic 1964 classic One-Dimensional Man).

Although it of course requires both qualification/nuancing and bolstering, the embourgeoisement argument, as applied to the GA period and understood in its later sociological form, points to an important transformation, which for this study’s particular purposes may be condensely restated as follows: postwar ‘affluence’ over time helped spark a general embourgeoisement of the working-class, tweaking behavioral and normative patterns in an overall status quo-maintaining and fiscally functional direction.

179 Goldthorpe et al. (1967) overall rejects the embourgeoisement thesis. Although space does not allow a more intricate assessment of the study, their conclusions are arguably hampered by some theoretical, conceptual and empirical shortcomings.

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Although he has reached very different conclusions from the above (see also below), the overall claim that a socio-economically-induced gradual popular normative change has taken place since WW2 has been productively taken up by Ronald Inglehart (e.g., 1971, 2000, 2008), as part of his larger multi-country empirical research on ‘post-materialism’. Put simply, Inglehart’s (2008: 131, 142-3; 2000: 26) post-materialism thesis, or more generally his ‘theory of intergenerational value change’, argued that a

‘shift from materialist to post-materialist priorities has been occurring’ amongst the ‘West European publics’ since the postwar period – a development associated with an increasing emphasis on for example ‘life style’, ‘subjective well-being’ and more generally ‘self-expression values’, involving a transformation of attitudes towards ‘gender roles, sexual orientation, work, religion, and childrearing’.

What is particularly productive about Inglehart’s argument concerning a shift in ‘value priorities’ is its distinctive macro-mechanism-oriented logic: Macro-level socio-economic development – especially associated with the extraordinary material/economic prosperity and security of the postwar period, along with rising educational levels, ‘postindustrialization’, etc. – helped introduce a popular ‘value change’ (principally operating at the individual or interpersonal level), which in turn has had political-institutional implications (notably bringing forth new political movements and political parties and party agendas focused less on class and more on identity, gender, environment, etc.).

Built into Inglehart’s (2008: 131) argument is not only a reasonable Maslow-oriented ‘scarcity hypothesis’ suggesting that ‘under conditions of prosperity, people become more likely to emphasise (…) goals such as belonging, esteem, and aesthetic and intellectual satisfaction’ but also a productive emphasis on ‘intergenerational’ processes. Based on the well-documented claim that ‘one’s basic values reflect the conditions that prevailed during one’s pre-adult years’, Inglehart (2008: 131, 136, 142, 133, 1971: 991) makes the argument that ‘the post-war cohorts’, which have ‘grown up under higher levels of existential security than those that shaped the formative years of the older cohorts’ – experiencing an

‘unprecedentedly long period of unprecedentedly high affluence’ – increasingly tend to ‘replace the older, more materialist cohorts’ and push ‘the prevailing values of society’ in a more post-materialist direction.

Although focusing on a different issue (and in general reaching different conclusions), Robert Putnam’s (e.g., 1995) empirical studies of the development of ‘civic engagement’ (or ‘social capital’) in the US supports this Inglehartian focus on postwar cohorts. Evidence from the General Social Survey (GSS), which traces individual cohorts, stresses the importance of a so-called ‘generational effect’

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when assessing levels of civic engagement. As opposed to so-called ‘life-cycle effects’, which points to ahistorical properties associated with the different life cycles, Putnam’s (Ibid.: 674-7) examination of generational effects reveals the existence of a ‘long civic generation’ born in the period 1910-1940.

Importantly, after this generation, social capital falls. Thus, the data shows that ‘each generation who reached adulthood since the 1940s has been less engaged in community affairs than its immediate predecessor’ (Ibid.: 675). Importantly, rather than for example focusing on the 1980s as the crucial period of civic disengagement (thereby perhaps linking it to, e.g., ‘neoliberalism’), Putnam (Ibid.: 676) emphasizes the peculiarity of the 1940s and 1950s: ‘it is as though the post-war generation were exposed to some mysterious X-ray that permanently and increasingly rendered them less likely to connect with the community’.

The historical particularity of the GA period, as Wolfgang Streeck (2011: 5) puts it (focusing on specifically capitalism), ‘still dominates our ideas and expectations of what modern capitalism is, or could and should be’. It has to some extent transformed our understanding of and standards for assessing previous and particularly subsequent decades: as Tony Judt (2005: 456-7) for example (only partly correctly but nevertheless very productively) argues, speaking of the economic crisis of the 1970s, ‘[i]t was not the 1970s that were unusual so much as the ‘50s and ‘60s’. More specifically, the growth-enclosed GA period has also helped shape the popular conception of what is economic normalcy and what is crisis: as Schmelzer (2012: 1006, 999) for example points out as part of his case study of the intellectual debates taking place amongst the OECD personnel in the period 1968-74, in contemporary understandings ‘economic crisis is often constructed as a crisis of growth’, that is, as the

‘absence of economic growth’.

Importantly, while, as mentioned, it was partly spawned during the revolutionary 18^th century (see also Been 1988) and increasingly developed throughout the first half of the 20^th century, the GA period served to popularly and institutionally-organizationally consolidate a cross-national Western European growth-oriented and consumption-optimizing agenda. As I shall attempt to argue, implicitly going against the Inglehartian conclusions (but not the generic framework), the unrivaled economic expansion and popular distribution of affluence of the GA period gradually served to stabilize a popular socio-psychological expectation of ever-widening economic growth and consumption prospects, eventually culminating, or articulating itself, around the late 1960s and early 1970s, in what may be described (in the overall spirit of the ‘ungovernability’-oriented terminology of the 1970s) as a socio-psychological

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and fiscal expectation/claim escalation. Below, in addition to the above intergenerational case for a transformation of the popular ‘value priorities’ of the Western European citizenry, some of the possible key mechanisms underpinning this escalation thesis have been selectively put together for closer examination.

Firstly, a strong argument can be made for the built-in ‘irreversibility of consumption on growth’

(Trezzini 2011: 550). What Trezzini (Ibid.: 539) calls the ‘asymmetric behavior of consumption’

implies that ‘[w]hile consumption tends to increase more or less readily when income rises, it proves to be much more inelastic with respect to decreases in income’. Put differently, this means that ‘[d]uring booms, consumers tend to acquire new and higher standards of consumption that are not readily reversed’ (Ibid.).¹⁸⁰ Importantly, one can perceive this irreversible consumption asymmetry – in which we tend to see ‘the continuous acquisition of growing standards of consumption’ – as a highly endogenous or built-in ‘mechanism that causes the economy to grow and accumulate’ (Ibid.: 554). In other words, not only does consumption-situated capitalist growth in itself ‘[tend] to generate a permanent, and more or less substantial, increase in the level of consumption’, this irreversible form of consumption is endogenous to economic growth, its asymmetrical logic is ‘essential in determining the net increase in income over the cycle’ (Ibid.: 544). Naturally, Trezzini’s theoretical-logical argumentation and his reasonable assumption that it is more likely that ‘a longer boom allows a more lasting acquisition of a higher standard of consumption than a shorter one’ (Ibid.: 344), seems to apply particularly well to the described unrivaled economic expansion and popular distribution of affluence of the GA period; self-escalation (of in this case consumption expectations) seems to be a salient feature of this configuration.

Secondly, the overall expectation/claim escalation thesis can be further, complimentarily, bolstered through what drawing on Fred Hirsch (1976: 7) can be called the ‘frustration in affluence’

argument.¹⁸¹ As opposed to the Club of Rome’s famous 1972 report entitled The Limits to Growth, which focused on the finite material conditions for future growth, Fred Hirsch’s highly

180 While Trezzini’s (2011: 358, fn. 1) argument is primarily logically constructed, he also points to empirical evidence for this consumption asymmetry.

181 Although Hirsch generally embeds this argument within the larger notion of the ‘paradox of affluence’, I have preferred this formulation, which he merely uses in passing, in order to put stress on the ‘frustration’ element.

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underappreciated 1976 book Social Limits to Growth put focus on the social ‘frustration’ associated with consumption-oriented economic growth. Hirsch distinguished between ‘material’ and ‘positional’

goods (and, respectively, the material and the positional economy). As opposed to the material economy, the positional economy concerned properties ‘that are either (1) scarce in some absolute or socially imposed sense or (2) subject to congestion or crowding through more extensive use’ (Ibid.: 27).

Positional goods (Ibid.: 32, 37, 41, 2), such as for example ‘leisure land’, ‘suburban living’, ‘leadership jobs’ or ‘education’, etc., are inherently socially relative and scarce and their quality and consumptive enjoyment intrinsically depends on ‘consumption by others’. Thus, the positional economy is characterized by ‘satisfactions that in their nature are possible only for a minority’; typically, in such type of system, ‘individual satisfaction in a specific activity’ is found to be ‘obstructed by the similar activity of others’ (Ibid.: 23, 22).

Significantly, according to Hirsch in advanced capitalist societies the positional type of economy increasingly dominates: ‘generalized material growth’ has triggered a more positional outlook; ‘as demands for purely private goods are increasingly satisfied, demands for goods and facilities with a public (social) character become increasingly active’ (Ibid.: 7, 4). Moreover, it seems clear that ‘as general standards of living rise, demand for luxuries becomes more extensively diffused throughout society’ (Ibid.: 1978: 66). Importantly, this relative dominance of positional goods has crucial societal consequences: because a built-in condition of the positional economy is that ‘individuals chase each other’s tales’ because ‘what each of us can achieve, all cannot’, frustration naturally increases (Ibid.: 5, 567). In a situation where ‘if everyone stands on tiptoe, no one sees better’, ‘intensified positional competition involves an increase in needs for the individual, in the sense that additional resources are required to achieve a given level of welfare’ (Ibid.: 4, 67). In other words, following Hirsch’s argumentation, and specifically targeting this chapter’s focus on the GA period, one can say that ‘the frustration in affluence results from its very success in satisfying the previously dominant material needs’ (Ibid.: 7).

In his own way, Albert O. Hirschman (1982: 10, emphasis in original, 44), in his insightful writings on the logic of ‘disappointment’, similarly noted the way in which consumption, besides providing satisfaction, tends to ‘also yield disappointment and dissatisfaction’. But whereas Fred Hirsch focuses on the frustration associated with the competition for positional goods that are intrinsically scarce, as described above, Hirschman (Ibid.: 61) stresses the disappointments ‘that come from

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experience with goods that are available and affordable, but simply do not yield the sort of satisfaction which were expected of them’. One of the most important endogenous factors that Hirschman (Ibid.:

44) points to is the high ‘disappointment potential’ of both durables (e.g., a refrigerator or a car) and services (e.g., health or education) – two types of goods whose sales/consumption both increased during the postwar period (on the main sectoral trends, see, e.g., Houpt et al. 2010).¹⁸² Firstly, as opposed to relatively ‘disappointment-resistant’ nondurables (e.g., sex or food), which provide ‘pleasure’,

‘comfort-yielding durable goods’ over time tends ‘to be taken for granted’ (Ibid.: 32). Arguably, given Hirschman’s additional argument that ‘disappointment could be especially widespread in a society in which mass diffusion of durables first occur’, this durables-comfort property seems particularly applicable to the GA case. Secondly, the ‘high disappointment potential’ associated with services stems from both ‘the high degree of variability in the quality and efficacy of the thing acquired’ and the typical ‘drop in quality consequent upon expansion’ (Ibid.: 40, 41). Importantly, this overall frustration in affluence argument, which in this study implies a synthetization of insights from both Hirsch and Hirschman that is applied to the postwar cohorts, is arguably indirectly/implicitly empirically corroborated through Richard A. Easterlin’s extensive four decade long empirical work on the connection between happiness and income/economic growth (see particularly Easterlin et al. 2010;

Easterlin 2003; Clark et al.: 2008).¹⁸³

182 Hirschman (Ibid.: 44), writing in 1982, also points out that durables and services ‘have greatly gained in importance in recent decades’.

183 Notably, Easterlin’s work, which has given rise to the famous ‘Easterlin paradox’, overwhelmingly reveals that

‘among countries, at a point in time happiness and income are positively related, but over time within a country, happiness does not increase as income goes up’ (Easterlin et al. 2010: 22467). These findings also seem to hold for developing countries (Easterlin et al. 2010). Specifically, in Western Europe, ‘there has been no obvious increase in life satisfaction over a thirty-year period, even though real incomes per capita have increased sharply’

(Clark et al. 2008: 96-7). Although one can observe a ‘positive short-term association between life satisfaction’, when looking at things ‘[o]ver the life cycle (…) as income increases and then levels off, happiness remains unchanged, contradicting the inference that income and well-being go together’ (Easterlin et al. 2010: 22466;

Easterlin 2003: 11180). For a strong recent rejection of some of the main denouncements of the ‘Easterlin paradox’, see Easterlin et al. (2010).

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