Originally published in The Conversation.
Economist Adam Smith wrote famously in 1776 that:
A merchant, it has been said very properly, is not necessarily a citizen of any particular country.
Over 200 years later, the head of Gillette, Al Zeien, espoused a similar view.
A global company views the world as a single country. We know that Argentina and France are different, but we treat them the same.
These quotes both highlight the global capitalist drive to accumulate profit in any market. But there is a difference between the two. Smith focuses on an economy in which capital flows between nations. Zeien alludes to an internationalism of capitalism into a singular global system that has occurred since the 1970s.
It is this very shift in capitalist accumulation that has created a new, transnational capitalist class. The formation of this class has evolved from the opening up of national economies and global integration since the Thatcher and Reagan era. Capital has become more mobile. This means that class formation is less and less tied to a particular nation-state or territory.
The transnational capitalist class is a global ruling class. It is a ruling class because it controls the levers of an emergent transnational apparatus and global decision-making. It is a new hegemonic bloc of various economic and political actors from both the global North and South, which has come out of the new conditions of global capitalism.
The ties that bind
Members of this new class have connections to each other that have become more significant than their ties to their home nations and governments. Forums such as the annual World Economic Forum at Davos are where these hyper-elites can get together and become a class without a country: the new global leadership.
This bloc is composed of the transnational corporations and financial institutions, the elites that manage the supranational economic planning agencies, major forces in the dominant political parties, media conglomerates and technocratic elites and state managers in both North and South.
Bono: a neoliberal in sunglasses? EPA/Jean-Christophe Bott
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These 7000 or so people include heads of state, religious and military leaders – even the neoliberal in sunglasses, Bono – but the core membership is businessmen: hedge fund managers, technology entrepreneurs and private equity investors.
What makes this class different from the traditional ruling class in previous epochs is that the interests of its members are increasingly globally linked, rather than exclusively local and national in origin. This is due to the increased mobility of capital, and technology has shifted to create an environment that is beneficial to members of this particularly modern class.
They are also ideologues, expressing the interests of global rather than local capital through free market neoliberal ideologies and the culture-ideology of consumerism. This follows directly from the shareholder-driven growth economy that lies behind the globalisation of the world economy.
This is not to say that the world is still not organised in terms of discrete national economies. The transnational capitalist class ideologically constructs the best interests of the world in terms of markets, which may or may not coincide with a specific nation-state.
How does it manifest?
This class’ economic and ideological power has a discourse of national competiveness and turning most spheres of social life into business. It strives to make schools, universities, prisons, hospitals and welfare more business-like.
In addition to the World Economic Forum, the transnational capital class also exercises power through its membership in thinktanks (such as the American Enterprise Institute, or Institute of Public Affairs in Australia) or corporate associations (such as the World Petroleum Council for the oil industry), and its control of the mass media, countless charities and foundations as well as university boards.
Their development of global, interconnected industries and businesses make them drivers of world capitalism. The program reaffirms the set of macroeconomic fiscal and monetary policies associated with neoliberalism: the withdrawal of the state from economic issues.
But these aspects are combined with a new emphasis on social issues and a quite liberal stance on these matters, emphasising, in the best bourgeois tradition, equality of opportunity, a new political culture of market individualism, and local political decentralisation along with a flexible labour market.
If, in cultural theorist Frederic Jameson’s assessment, postmodernism is the “cultural logic” of late capitalism, what we may be seeing is the emerging “political logic” of global capitalism, with its attendant forms of flexible accumulation.
As a result, the whole global production process is broken down into smaller parts and moved to different countries where investment and profit are the highest. Yet, at the same time, this worldwide decentralisation and fragmentation of the production process has taken place alongside the centralisation of command and control of the global economy by this class.
In a recent Oxfam report, it was noted that in the past 20 years, the richest 1% had increased their incomes by 60%. Barbara Stocking, an Oxfam executive, said unequivocally that this is:
… economically inefficient, politically corrosive, socially divisive and environmentally destructive … We can no longer pretend that the creation of wealth for a few will inevitably benefit the many – too often the reverse is true.
The new global capitalism opens up a large rift between the global rich and the global poor, not just on a national scale. EPA/Stephen Morrison
The top 147 transnational corporations control roughly 40% of the entire economic value of the world’s transnational corporations.
This form of globalisation unifies the world into a single production system. But this also means that the new global capitalism opens up a large rift between the global rich and the global poor, not just on a national scale. Therefore, the 21st century is going to see conflicts and disputes for control between the new transnational ruling group and the expanding ranks of the poor and the marginalised.
In developing countries such as Turkey, there has been the downward mobility – or proletarianisation – of older middle classes and professional strata. Peasants and artisans, and the working class itself, has become flexible and informal.
A growing global working class has emerged that runs the factories, offices and farms of the global economy. It is a stratified and heterogeneous class, to be sure, but an expanding one. It is this new proletariat created in Latin America since the 1980s that is largely responsible for the “left turn” in the region.
And although the first world working class does not realise it, being dependent on first world surplus profit, these are our allies in creating a better, fairer, sustainable world.
It is not clear in the new epoch how the contradictions of global capitalism will be played out, in particular those of overaccumulation and worldwide social polarisation. An expanding transnational proletariat is the alter ego of the transnational capitalist class. Struggle between the two will shape the dynamics of emerging global society.