100 Stephen Hymer regional or local capital markets,and in this way shedding their national character and becoming part of international capital.1 National Corporations and National Finance Capital An analogy might be made here to the development of the national corporation and national capitalism in the United States at the turn of the century.Prior to that time,the typical industrial enterprise was the closed family firm with only a few outside shareholders.With the merger movement and the development of a national capital market for in- dustrial equity stock,the modern corporation began to emerge with many shareholders,none of whom owned a majority of stock. Much has been written about how the dispersion of ownership and the lessening of direct control over management by owners has created an autonomous technostructure which operates independently of the speci- fically capitalist character of the production process.However,it seems to me to be more appropriate to look upon this process in exactly the opposite way.From the point of view of the large capitalists,that is,the I percent of the population that owns the vast majority of corporate stock,the modern corporation was an institutional device for maintain- ing their control and ensuring the continued accumulation of their wealth. What happened,in effect,was that the wealthy exchanged shares among themselves,thus forging a common front.Far from relinquishing their interests,they generalized them.Instead of each family capital being locked into a specific firm,it became diversified over many firms and over other assets,such as government bonds and land.In this system,competition more or less assures the equalization of the rate of return;and each capital,if it is sufficiently diversified and prudently managed,will share in the general social surplus,according to its size. Rivalry remains as each capitalist strives to obtain an above-average rate of return,but a dominant general interest in the aggregate rate of profit emerges.At this higher level "capitalists form a veritable free mason society vis-a-vis the whole working class,while there is little love lost between them in competition amongst themselves"(Capital,vol.2). The corporate structure and the development of a managerial class enabled capital to delegate the work of supervising labor to others and to rely on the market and the government to maintain the rate of profit and the rate of accumulation.In this connection Marx quotes Aristotle: "Whenever the masters are not compelled to plague themselves with supervision,the manager assumes this honour while the masters attend to affairs of state or study philosophy"(Capital,vol.3,p.377).Or one might use Plato's system and say that owners of capital have been This content downloaded from 202.120.14.154 on Mon,04 Jan 2016 03:31:29 UTC All use subject to JSTOR Terms and Conditions100 Stephen Hymer regional or local capital markets, and in this way shedding their national character and becoming part of international capital.' National Corporations and National Finance Capital An analogy might be made here to the development of the national corporation and national capitalism in the United States at the turn of the century. Prior to that time, the typical industrial enterprise was the closed family firm with only a few outside shareholders. With the merger movement and the development of a national capital market for in￾dustrial equity stock, the modern corporation began to emerge with many shareholders, none of whom owned a majority of stock. Much has been written about how the dispersion of ownership and the lessening of direct control over management by owners has created an autonomous technostructure which operates independently of the speci￾fically capitalist character of the production process. However, it seems to me to be more appropriate to look upon this process in exactly the opposite way. From the point of view of the large capitalists, that is, the 1 percent of the population that owns the vast majority of corporate stock, the modern corporation was an institutional device for maintain￾ing their control and ensuring the continued accumulation of their wealth. What happened, in effect, was that the wealthy exchanged shares among themselves, thus forging a common front. Far from relinquishing their interests, they generalized them. Instead of each family capital being locked into a specific firm, it became diversified over many firms and over other assets, such as government bonds and land. In this system, competition more or less assures the equalization of the rate of return; and each capital, if it is sufficiently diversified and prudently managed, will share in the general social surplus, according to its size. Rivalry remains as each capitalist strives to obtain an above-average rate of return, but a dominant general interest in the aggregate rate of profit emerges. At this higher level "capitalists form a veritable free mason society vis-a-vis the whole working class, while there is little love lost between them in competition amongst themselves" (Capital, vol. 2). The corporate structure and the development of a managerial class enabled capital to delegate the work of supervising labor to others and to rely on the market and the government to maintain the rate of profit and the rate of accumulation. In this connection Marx quotes Aristotle: "Whenever the masters are not compelled to plague themselves with supervision, the manager assumes this honour while the masters attend to affairs of state or study philosophy" (Capital, vol. 3, p. 377). Or one might use Plato's system and say that owners of capital have been This content downloaded from 202.120.14.154 on Mon, 04 Jan 2016 03:31:29 UTC All use subject to JSTOR Terms and Conditions