Our Modern Times: The New Nature of Capitalism in the Information Age (review)

Many social scientists find that capitalist variations emerge out of the challenges that businesses face in coordinating their activities in a dynamic environment. A second group privileges labor control and views modern capitalism as a succession of labor regimes. The first group's managerial capitalism is the second's Fordism. Daniel Cohen, a French economist, is of the second school.

The first school attributes the growth of the flexible work practices typical of contemporary capitalism to the changing environment brought about by the oil shocks of the 1970s. As the price of gasoline climbed, Americans found small, fuel-efficient imported cars more attractive. Japanese firms, such as Toyota, quickly took advantage of the new preferences because they had developed flexible methods of production, including the management of labor. Over time, firms everywhere followed suit. In contrast, Cohen offers a sociological explanation of these changes. He tells us that the May 1968 generation rejected the world of their parents. Rebellious baby boomers refused to work on the assembly line, with its hierarchies and standardized goods. Students raised on anti-establishment American campuses not only said no to the assembly line, but created the computer science that revolutionized both production and consumption.

Cohen marries this sociological argument with an economic one. Information age capitalism triumphed because of the triumph of financial capital. Joseph Schumpeter had feared that capitalism could not survive because the bureaucracies of managerial capitalism would shackle the entrepreneurial spirit. Cohen argues that Schumpeter was wrong. Capitalism survived by crushing managerial capitalism, which was replaced by a "new 'patrimonial capitalism' that marks the revenge of the shareholders on the wage earners" (p. 54). Thus, the 1980s financial revolution created new value for shareholders by repudiating implicit contracts, dismissing older employees, severing ties with sub-contractors, and splitting many of the networks that made up the older managerial capitalism. Typically, conglomerates were dismantled.

To Cohen, the 1980s was the decade of destruction. During the 1990s, the slimmer or core firms applied the new organizational principles to labor and employed innovative technology to create the new economy and the new world of the autonomous worker. The computer raised productivity by allowing one person to perform new tasks—that is, the work was intensified. Thus, the night hotel clerk with accounting software produces the guest's bill for the morning. Our Modern Times, half analysis, half social critique, is a meditation on this world of labor in the information age, the successor to the era of managerial capitalism or "Fordism."

In the new order, "workers are asked to be autonomous, to use their 'human capital,' and this should constitute progress with respect to the assembly line age when people were treated as automatons" (p. 5). However, in the tradition of C. Wright Mills, Cohen notes that the autonomous workers who must demonstrate personal initiative suffer from mental stress, which replaces the physical fatigue of the Fordist worker. "In today's world, it is no longer machines that break down; it is men and women" (p. 40). The agnostic would like a little proof.

Cohen does not shy away from the marriage between the world of computer freedom and a Thatcherite and Reaganite political economy. Both value the individual over society and the part over the whole. Yet he hopes that just as Fordism turned aside its "totalitarian" potential for social democracy, so the new world of capitalism is merely waiting for appropriate government regulation so that financial capital no longer dominates human capital (pp. 51-52).

Our Modern Times was originally conceived and probably written before the economic downturn beginning in 2000. Like much of the social criticism of the 1950s and 1960s, Cohen assumes that the new economy, whatever its social imperfections, will perform economically. He observes that information age capitalism leaves many behind...