Capitalist good guys: Bankers, businessmen and the US political system

Ben Tipton, The University of Sydney

Mark S. Mizruchi The Fracturing of the American Corporate Elite, Cambridge, Massachusetts and London England, Harvard University Press, 2013 (xiv, 363 pp). ISBN 9-78067407-299-2 (hard cover) RRP $55.99.

Susie J. Pak, Gentlemen Bankers: The World of J.P. Morgan, Harvard Studies in Business History, 51, Cambridge, Massachusetts and London England, Harvard University Press, 2013 (356 pp). ISBN 9-78067407-303-6 (hard cover) RRP $104.99.

Mark Mizruchi and Susie Pak both offer the pleasure of reading about those with far more money than any normal person is likely to see in one pile, and access to power and influence that normal people can only fantasise about late at night over a sizzling thriller (Reilly 2004). Mizruchi traces the rise and influence of ‘moderates’ among the American business elite from 1900 to the 1970s, and argues that these corporate executives were held together by their connection with leading bankers. Those connections broke in the 1980s, resulting in the ‘fracturing’ of the American elite and their paradoxical lack of effectiveness today. Pak analyses the networks connecting the leading bankers from 1900 to the 1930s, and argues that their position both as ‘gentlemen’ and as bankers depended on shared assumptions of hierarchy, gender and race. Time and energy devoted to maintaining those divisions paradoxically allowed them to appear natural, and allowed these groups to renew and perpetuate themselves.

Both Mizruchi and Pak echo C. Wright Mills’ classic 1956 study The Power Elite, though Mizruchi cites Mills only once (p. 14) and Pak not at all. The first to analyse the American elite in these terms, Mills identified an interlocking group of political, military and economic leaders. Members of the elite ‘cloned’ themselves from one generation to the next through elite schools and shared experience. Their ‘class identity’ allowed them to believe themselves innately superior to the rest. Their education gave them an ‘interchangeability’ that allowed them to move easily among the various hierarchies of power. To a degree their behavior was ‘unconscious’. Many of their decisions relied on what Mills called ‘crackpot rationality’, logical reasoning based on manifestly false premises, and ‘organized irresponsibility’ meant not only that they were unaccountable for their bad decisions but also that the locus of decision making was frequently obscured. Mills worried particularly about the ‘permanent war economy’ that the elite’s ‘military metaphysic’ supported. In a famous chapter entitled ‘The Higher Immorality’, he asserted bluntly that corrupt institutions elicited corrupt behaviour from individual members of the elite (Mills 1956, ch. 15). Mills clearly regarded the elite as bad guys, and the book unleashed a firestorm of criticism. In retrospect, Mills overestimated the independent power of the military and overstated the ability of the elite to manipulate public opinion through the mass media, but his analysis of the ‘upper levels’ of power in the United States remains acute and relevant today (Domhoff 2006).

Mizruchi has a very contemporary agenda.

Mizruchi criticises ‘elite theorists’ such as Mills, but still believes that under certain circumstances elite groups can exercise great power, particularly the ‘inner circle’ of chief executives of the very largest corporations (pp.14–16). In addition, he has decided that some of the elite are not the ‘bad guys’ he believed them to be earlier in his career (p. xii). Pak implicitly updates Mills, adding a feminist thrust to his broad gauge critique, and showing some of the ways in which the elite of the banking world maintained their power across generations. The division between the public and private realms that she sees as crucial to the banks’ operations also worked to conceal the position of the elite ‘gentlemen’ from public scrutiny.

Pak’s study remains essentially historical; Mizruchi, however, has a very contemporary agenda. He is ‘distressed’ (p. xi) by contemporary American politics: ‘intransigent groups, he says, ‘hold the nation hostage to their extreme views’. The result is a ‘stalemate, the inability to accomplish even the most routine tasks of government’. What happened, or rather, what has changed? Mizruchi insists repeatedly that he is not describing a golden age. Nevertheless, from the first to the seventh decade of the 20th century, he says, significant members of the American business elite advocated a broad range of surprisingly moderate policies. Who were these not-so-bad guys? Mizruchi highlights two organisations, the National Civic Federation (NCF) founded in 1900, and the Committee for Economic Development (CED) founded in 1942. Both included the heads of some of the largest American corporations. Over the decades their members came to accept the role of government as regulator of economic activity and to accept organised labor as at least an ‘uneasy partner’.

Each of Mizruchi’s chapters features a central example. At the turn of the 20th century, the newly founded NCF propounded a vision of ‘responsibility’ on the part of employers and attempted to establish ‘a relation of mutual trust between the laborer and the employer’ in the words of one of its leaders. The NCF advocated child labor laws and government regulation of utility companies and supported the establishment of the Federal Reserve. It failed to achieve broad acceptance of labor unions by employers, but in 1905 turned to advocacy of ‘welfare capitalism’ by individual firms, including housing, eating facilities, pensions and health care, and from 1909 joined with labor representatives to lobby for workers’ compensation laws, adopted by all but six states by 1920. As such, the NCF established a tradition of moderation among business leaders and laid a philosophical foundation for the later CED (pp. 27–30).

In addition to welfare programs sponsored by private employers, moderate business leaders came to see a positive role for the state. During the 1920s, ‘American business people appeared to adopt a crude form of Keynesian economics’, including the notions that lack of demand could cause a depression, or that excessive saving could restrict consumption, and therefore that the wealthy who saved should be taxed while poor families who could not save should be supported (pp. 49–50). These attitudes spread; Mizruchi argues that wider circles of business leaders gradually accommodated themselves to Roosevelt’s New Deal policies, and abandoned the ‘almost religious’ belief in balanced government budgets with the outbreak of war in 1941. The CED supported countercyclical spending, unemployment compensation and tax cuts as mechanisms government could use to combat downswings. In the 1950s President Dwight Eisenhower, who had served as a trustee of the CED, appointed numerous CED members to official positions. And, rather than the expected conservative turn, Richard Nixon’s election in 1968 saw the establishment of the Environmental Protection Agency (EPA) and the Occupational Safety and Health Administration (OSHA). The 1971 CED report Social Responsibilities of Business Corporations insisted that ‘enlightened self interest’ required business and government to work together to eliminate poverty, protect the environment and provide housing, health care and education, and to ensure equal opportunity for all to ‘ample jobs and career opportunities’ (pp. 73–74).

In the ‘Treaty of Detroit’, GM recognised the union as a legitimate and necessary partner.

As with the role of the state, the influence of moderate business leaders led larger circles of employers to accommodate themselves to the existence of labor unions. General Motors already in the 1930s typified the ‘realism’ that spread during the war and through discussions of postwar conditions, and culminated in the ‘Treaty of Detroit’, the collective bargaining agreement signed by GM and the United Auto Workers in 1950. Hailed nationally as an historic compromise, the agreement ran for a virtually unprecedented five years. On the one hand management recognised the union as a legitimate and necessary partner, while on the other the union allowed management full control of production scheduling, model changes and plant investment. The agreement included generous and expensive grants of pay and benefits, but also stipulated that pay increases could only come as a result of increases in productivity. Chrysler, in contrast, refused to negotiate with the UAW, endured a costly 100-day strike, and was widely regarded not only as ‘inept’ but also as ‘increasingly rare’ in its intransigence (pp. 94–98).

Mizruchi believes the glue that held the moderate business establishment together was brewed in the boardrooms of the leading banks. The banks, he says, played three roles: they provided venues for the exchange of information, they ‘served as a source of normative consensus’ among leading executives and they encouraged ‘cognitive range’—the breadth of outlook that Mizruchi believes characterised the moderate business elite. Their typically quite large boards included executives from a broad range of industries, who could exchange experiences, offer advice and suggest alternatives to potentially deviant members of the elite, that is, those inclined or tempted to behave the way capitalist bad guys might normally be expected to (pp. 129–136).

However, since the 1980s, although individual corporations may be larger, stronger and richer than ever, and although their spending on lobbying and elections has risen by orders of magnitude, as a group their ability to influence policy has disappeared (p. 269). Mizruchi says that, paradoxically, business won the war but lost the battle. From the late 1960s large firms suffered from inflation, slow growth and increased foreign competition. Widespread hostility to business typified by leftwing denunciations and by what now seemed intrusive interference by government agencies such as the EPA and the OSHA convinced many business leaders that, as Supreme Court nominee Lewis F. Powell Jr. wrote in 1971, ‘the American economic system is under broad attack’ (p. 146). Powell’s influential memo typified a new mindset, and business leaders mobilised in a counterattack, for instance in the foundation and support given to the American Enterprise Institute and the Heritage Foundation, and the direct lobbying efforts of the Business Roundtable. Moderate voices including the CED lost influence (ch. 6).

Ronald Reagan’s presidency saw a significant retreat from the government’s commitment to social amelioration, and a significant reduction in its regulatory activities (pp. 180–187). At the same time direct foreign competition and American firms’ willingness to use foreign workers undermined the position of American labor unions, which also suffered from government hostility. Reagan stacked the National Labor Relations Board with anti-labor members, after famously breaking the strike of the Professional Air Traffic Controllers Organization (PATCO) in 1981. Unions, already weakened by legislative defeats and the decline in membership from over a third to just over a fifth of the non-agricultural labor force, faced a concerted attack by employers and a ‘strongly anti-labor’ government. The PATCO strike—‘the pivotal episode’ according to Mizruchi (p. 188)—marked a watershed; nationally, strikes involving at least 1,000 workers had fluctuated around a mean of over 300 per year from 1948 to the late 1970s, but then plummeted to fewer than 50 in every single year from 1986 to 2010 (pp. 187–191).

The business elite emerged victorious, but the glue that held them together came unstuck. The banks, which Mizruchi believes previously formed the centre of the system, suffered on two fronts. Until the 1970s the vast majority of individual savers had no other options than passbook savings accounts, with rates of interest that were regulated by the federal government, and that had lagged well behind the rate of inflation. Deregulation of bank interest rates in 1980 and the emergence of new instruments paying higher rates forced the banks to pay higher rates to attract deposits. On the other side corporations found they could borrow overseas in the Eurobond market, or from each other in the form of promissory notes, and this new competition lowered the rates banks could charge on their loans (pp. 192–193). By the late 1980s several found themselves in ‘serious trouble’, including Citicorp, the nation’s largest (p. 194). In response, banks moved away from lending to the provision of fee-for-service products such as foreign exchange, capital underwriting, derivatives and general advice. As the banks recovered, their new business focus led them to reduce the size of their boards and reduce the numbers of directors drawn from large nonfinancial corporations. As the previous networks unravelled, the banks ‘inadvertently abdicated their role in forging cohesion within the corporate community’ (pp. 195–197).

By the late 1980s, belonging to the business elite was less fun than before.

Mizruchi also thinks belonging to the business elite was less fun than before. The rise of the large publicly-held corporation had led, with only a few exceptions, to a virtually complete separation of management from ownership. Through the 1960s individuals owned by far the largest share of the stock of publicly traded firms, but played no role in those firms. Senior managers enjoyed life. They served long terms, overseeing an environment that they could regard with equanimity, protected by their own efficiency, in partnership with government, labor, their bankers and other likeminded executives. They often presided over conglomerate firms across industries, partly the result of antitrust legislation that restricted their ability to expand in their own industry, but justified by the theory that the firm could be seen as a portfolio of assets that would reduce the risk of relying on a single market. Mills would add that their children continued to attend elite institutions and to socialise with others of their kind; Pak’s study reminds us that the fun of the life of an elite man depended on the support of his wife, and on the unstated but clear divisions between domestic and professional lives, between men and women and between races. She notes that Harvard’s Board of Overseers did not have an African American member until 1959 and the Harvard Corporation not until 2001 (p. 157).

The recession of 1973–74, continued slow growth, the difficulties of operation in multiple markets, and to some degree complacency and incompetence, all led to significant undervaluation of share prices. The conglomerate model fell out of favour. Corporate raiders targeted firms that could be broken up and the parts sold. During the 1980s, fully one-third of Fortune 500 firms disappeared. The takeover wave ended, but in the meantime another group had emerged: large institutional investors including bank trust departments, insurance companies, pension funds and mutual funds. The proportion of stock in listed firms held by institutional investors rose from 16 per cent in 1965 to 46 per cent in 1990. They held large blocks of shares, and unlike individual investors, who played no role in management of firms, institutional investors, began to intervene when displeased, rather than simply selling their shares. Intervention usually took the form of pressure on individual senior managers. Mizruchi reports that the average tenure of Fortune 500 CEOs declined from 9.7 years in 1982, to 6.8 years in 2002 (pp. 214–216).

The increasingly insecure leaders of American corporations spent far more time and energy on what came to be known as investor relations, but also on self promotion. The generation of ‘brash, swashbuckling celebrity’ CEOs owed little to anyone but themselves, and the institutional shareholders whose disfavour might cost them their jobs (p. 217). The corporate elite also became more diverse. White, male, Protestant graduates of elite eastern universities rubbed shoulders with a new mix of leaders from different regional, educational, ethnic, gender and socioeconomic backgrounds. Or, rather, did not rub shoulders with them, argues Mizruchi, for this was another factor in the decay of the social networks that had held the previous generation together (pp. 215–217). In ‘the aftermath’, Mizruchi argues, American corporations became less likely to support charities, turned hostile to any increase in taxes even when this cut against their preference for a balanced federal budget and opposed national health insurance even when this meant increased liabilities for the firms themselves. Crucial issues, among them education and the environment, simply disappeared from the collective view of corporate leaders (pp. 219–221, ch. 8). The business elite ‘fractured’. They abdicated collective responsibility in favour of ‘firm-specific activities’ intended ‘to gain individually tailored advantages’ while neglecting their more important collective interests (pp. 270–272).

Mizruchi begins with a chapter on the rise of the corporate elite that, if I had been his editor, would have been cut, because it details battles between members of the elite who never joined Mizruchi’s moderates, notably partners in the banking firms J.P. Morgan & Company and Kuhn, Loeb & Company. However, this is Susie Pak’s world, and her account of it qualifies Mizruchi’s story. Spatially and socially, Pak shows, bankers structured their world around hierarchies, particularly of gender and race, but also of firms and of individuals within firms. In addition, they divided the world into a public and a private sphere. At the apex stood two firms, Morgans and Kuhn, Loeb. Though rivals, they nevertheless collaborated regularly. Kuhn, Leob ranked number four among participants in Morgan syndicates from 1894 to 1914 (p. 18). Pierpont Morgan and his partners came from uniformly old Protestant families; Jacob Schiff and his partners were first generation German Jewish migrants. In private, Morgan and his partners were uniformly anti-Semitic; Schiff feared assimilation would destroy his family’s Jewish identity. Their public, business offices clustered downtown; their residences clustered together uptown, but in separate neighborhoods. Jews did not gain listing in the Social Register, which since 1886 has listed New York’s social elite families: husbands with schools, firm, clubs, residences and names of yachts; wives with maiden name, schools and charities; children with schools. Jews also were excluded from the clubs where Morgan partners socialised and it appears that anti-Semitism and exclusivity increased following the First World War.

Chief among a banker’s items of social capital were his wife and children.

This is all a good deal less than counter-intuitive; more interestingly, Pak argues that the separation of the domestic and social realm from business affairs, and the confinement of women to the domestic realm, were the unspoken foundations of the system, supporting the walls that held potential conflict at bay and enabled the two firms to co-exist. American legal scholars and federal courts agreed that the right to privacy was a form of property (pp. 42–43). This meant that a private individual was free to discriminate against others, notably on the basis of race or religion, but it also meant that the relationship between a banker and his clients was protected from outside observation or interference, for instance by government agencies. In the absence of public scrutiny, ‘gentlemen bankers had to protect their reputation and social capital at all costs’. Chief among a banker’s items of social capital were his wife and children, and second were the reputations of his and his wife’s extended families (p. 95).

Viewing Mizruchi’s argument from Pak’s perspective, hierarchy seems the key term. Firms seeking finance approached bankers, who organised syndicates to market bonds. Participants, the initial underwriters, the wholesalers and those who sold the bonds to individual clients, were ranked according to their role and the extent of their participation. Reputation, as Pierpont Morgan told the Pujo Committee of the US Senate in 1912, and as his son Jack told the Nye Committee in 1935, was everything. Social capital, built up as Pak shows in the private and domestic realms, could command capital in the public realm of business. One’s rank, as a first, second, or third tier participant in a Morgan or in a Kuhn, Loeb syndicate, and the allocated share at that level, demonstrated character, solidity and status as a ‘gentleman’ upon whom clients could rely. There were no women in the bankers’ public sphere, but ‘the absence of women is exactly what made them important. Without women, social interaction in the financial community did not carry the same implications as they did in the domestic sphere … the absence of women allowed for personal and social contact in the world of business without disturbing the social hierarchies and mores found in the society at large’ (p. 95).

The point is that the banks at the apex, Morgan and Kuhn, Loeb, could not have functioned in the manner Mizruchi argues, because they had no boards. They were private partnerships, as were several of their major collaborators. First National Bank of New York and National City Bank, publicly licensed, did have boards, but they were second tier, clearly subordinate to Morgans and Kuhn, Loeb. Individuals connected with the National Civic Federation may have played influential roles, but Pak never mentions the organisation, and never suggests that the men from second tier firms exercised significant influence over the senior partners of Morgans or Kuhn, Loeb. Pierpont’s son Jack and the other Morgan partners never reconciled themselves to the New Deal. However, as Pak explains, they did recognise the significantly increased power of government. In response, they created a myth of the private banker as a ‘public servant’ (p. 218, emphasis in original) and reorganised themselves as a ‘public’ company, because they had discovered that ‘they did not need to remain a private bank to safeguard the foundations of their business’ (p. 221).

Following the Second World War, Eisenhower’s appointment of members of the Committee for Economic Development may have derived at least as much from the wartime experience, as from an autonomous push from ‘moderate’ business executives. Karl Schriftgiesser’s (1960) official history of the CED supports Mizruchi’s story, of course, but other interpretations are possible. Paul Hoffmann of the Studebaker automobile company and Edgar Kaiser of Kaiser Aluminum, for example, owed their prosperity and survival to their wartime government contracts, and those connections persisted into the 1950s. Having won the war in collaboration with government and labor unions, they continued that collaboration. However, first, this is precisely the period that Mills saw the bad guys of power elite at their most irresponsible and rapacious, and second, even if we accept Mizruchi’s argument that some were not-so-bad guys, it is still arguable that as the moderates departed the scene, they would have been replaced by others, either not so good, or wholly bad.

Pak points out that there were no women in the bankers’ public sphere.

Mizruchi portrays Jack Welch of General Electric as the archetype of the next generation of CEOs (pp. 217–218) but Welch is not a good example for his argument for the increasingly insecure position of business leaders. Under Reg Jones, voted CEO of the Year three times in the 1970s and hailed as a ‘management legend’, GE stood at the cutting edge of management practice. Handpicked by Jones, Welch served for 20 years, and retired at the mandatory age of 65 in 1991. And, although famous for combating ‘corporate bureaucracy’ and eliminating the strategic planning division at GE, he in fact introduced a process of continuous planning under central control, one of the factors that allowed GE to succeed as a conglomerate while so many others failed (see Wozny 1999). More generally, Mizruchi also under-emphasises the context his actors worked in, particularly the transformation of the southern states from solidly Democratic to solidly Republican, the entrenched position of many of these Republicans in Congress, and the longstanding conservatism of business groups such as the National Association of Manufacturers and the national Chamber of Commerce. Moderate business leaders may never have been more than a minority, influential only when the political constellations lay favourably.

Whither America? Mizruchi hopes for leadership from individuals in the business community (p. 286), but there seems little reason to doubt his analysis of the competition between individual firms for government favours, and therefore little reason for optimism regarding a collective approach. Even if we agree that capitalists can be good guys, willing to advocate responsible long-range policies, at present America’s major corporations spend money in record amounts to secure influence, but the influence they seek benefits only themselves.

And what of the banks? The litanies of scandals uncovered by the Pujo, Pecora and Nye committees following the 1907 and 1929 crises makes depressingly familiar reading. Dubious securities foisted on gullible customers, lavish rewards bestowed by the bankers on themselves, exploitation of legal loopholes, evasion of regulatory requirements and sometimes outright illegality, all foreshadow the behavior of the banks leading to the 2008 Global Financial Crisis, duly examined in another congressional inquiry (Financial Crisis Inquiry Commission 2011). There are some depressing ironies as well in the mistakes made by the supposedly best qualified bankers alive. Morgans’ largest single loss before 1914 came from a bad loan made in Argentina, calling to mind the bad Argentine loans made after their deregulation by United States savings and loan institutions, and ‘Russian bonds’ of course went up in smoke in 1917, as they did again 70-odd years later.

The internal workings of the banks suggest that it is unlikely they will return to the role Mizruchi believes they played before. Anthropologist Karen Ho’s fieldwork in Wall Street’s investment banks in 1999 revealed a culture focused around the concept of ‘smartness’. Recruited from elite universities (an innovation of the 1920s, as we learn from Pak), new graduates in the 1990s were told they were the smartest, that they would be working with the smartest, surrounded in fact by the smartest people in the universe. The very smartest were the ones who could ‘wow’ a client, who typically was an executive from a Fortune 500 firm. However, Ho also discovered that ‘technical skill and business savvy’, which one might expect would wow a client, were things that could be ‘learned on the job’. The key to being smart, and being perceived as smart, was a certain image. Hard working, of course, buying lunch but then taking it back to the desk, but also immaculate dress, appearance, vigour and aggressiveness. ‘Smartness’ in fact referenced the image of an upper class, white, heterosexual male (Ho 2009, pp. 40–41). Working hard, for a female could mean being mistaken for a secretary, for an Afro-American as overdoing, and for an Asian-American being pigeonholed as a nerd.

Being ‘smart’ for Ho’s informants played the same role as being a ‘gentleman’ had for their grandfathers. However, Ho also discovered that for the vast majority being ‘smart’ and possessing an elite education did not guarantee security or success. Insecurity, high pay but with the threat of being ‘let go’ at any time, marked the culture. Insecurity reinforced the need to ‘wow’ clients, to secure business for the firm, to do deals for the firm, not for the client and certainly not for the client’s share-holders, even though every deal would be sold for the supposed increase in shareholder value it would bring (Ho 2009, chs 3 & 6).

Mizruchi hopes for leadership from individuals in the business community.

Ho’s study is not longitudinal; if it had been, the likelihood of escaping the ‘axe’ or surviving the periodic episodes of ‘downsizing’ would correlate closely to family background, for an elite degree no longer carried the same weight in social capital. Pak’s analysis of the controversies over Afro-American and Jewish students at Harvard in the 1920s (ch. 5) proves prescient, for opening elite education to all emphatically has not meant equal access to elite status. As Mills remarked more than 50 years earlier, it is not Harvard, but which Harvard, that counts. Despite their pretensions, Wall Street’s investment bankers belong not to the power elite but to Mills’ ‘lumpenbourgeoisie’, the insecure and driven ‘white collar’ class that Mills analysed in another classic study published in 1951. Ho’s account parallels Mills, but she adds the point that bankers rationalise their own job insecurity as the result of impersonal, extrinsic market forces. They then ‘export this model to the rest of U.S. business’, as both a descriptive and a normative framework (Ho 2009, p. 214). Because they themselves are insecure and consequently focused on short-term rewards, other firms are and should be focused in the same way.

Shortly after Ho completed her fieldwork came the dot-com boom and collapse, a bubble of overvalued shares pushed on to gullible clients by ‘smart’ representatives of prestigious firms on the basis of hypothetical future earnings. Less than a decade later, the same firms caused the Global Financial Crisis, the implosion of toxic derivatives once again marketed as high returns with low risk (Financial Crisis Inquiry Commission 2011; Ho 2009, ch. 7). In the aftermath, the government bailed out banks deemed by their friends as ‘too big to fail’ (Lanchester 2008, 2009), just as Morgans decided whether or not to support troubled firms in 1907 and 1929.

We might conclude that too much power has been placed in too few hands—in Scarecrow, novelist Matthew Reilly (2004) entertains us with a ‘Council’ of twelve industrialists who plan a war in order that they may profit from arms sales, but in the historical world this reminds us of the fury of Morgan partners at being identified as ‘merchants of death’ for the bank’s role in the international arms trade (Pak, pp. 208–210). Mizruchi regrets that those few hands compete unproductively with each other, but we might question whether we wish our future to rest in the hands of an irresponsible oligarchy, however beneficent. Mizruchi looks for leadership, but Pak shows indirectly, and Ho rather more directly, why there seems no man on a white horse, or no friendly gang of not-so-bad guys in white hats, anywhere on the western corporate horizon. Nevertheless, Mizruchi has flagged a critical issue: the failure of America’s economic elite to address crucial economic and social problems in a productive way, and Pak traces it to its possible roots. These are books worth reading, and thinking about, possibly before ordering a used copy of The Power Elite, or settling in with Reilly’s latest thriller.

REFERENCES

Ho, K. 2009, Liquidated: An Ethnography of Wall Street, Duke University Press, Durham and London.

Domhoff, G.W. 2006, ‘Mills’s The Power Elite 50 years later’, Contemporary Sociology, vol. 35, no. 6, pp. 547–550.

Financial Crisis Inquiry Commission 2011, The Financial Crisis Inquiry Report: Final Report of the National Commission on the Causes of the Financial and Economic Crisis in the United States, Government Printing Office, Washington DC.

Lanchester, J. 2008, ‘Cityphobia’, The London Review of Books, vol. 30, no. 20, pp. 3–5.

Lanchester, J. 2009, ‘Bankocracy’, The London Review of Books, vol. 31, no. 21, pp. 35–36.

Mills, C.W. 1956/2000, The Power Elite, new edition, Oxford University Press, Oxford and New York.

Mills, C.W. 1951/2002, White Collar: The American Middle Class, 50th anniversary edition, Oxford University Press, Oxford and New York.

Reilly, M. 2004, Scarecrow, Pan Macmillan Australia, Sydney.

Schriftgiesser, K. 1960. Business Comes of Age: The Story of the Committee for Economic Development and Its Impact up the Economic Policies of the United States, 1942–1960, Harper and Brothers, New York.

Wozny, M. 1999, ‘GE’s two-decade transformation: Jack Welch’s leadership’, Harvard Business School Case 399–150, in Transnational Management, by C.A. Bartlett, S. Ghoshal & J. Birkinshaw, 4th edn, 2004, Boston, McGraw Hill/Irwin, pp. 793–813.

Frank B. (Ben) Tipton was educated at Stanford and Harvard, where he studied with economic historian David S. Landes and Nobel Prize winning economist Simon Kuznets. He is Professor Emeritus in International Business at The University of Sydney Business School. His books include A History of Modern Germany since 1815 (2003) and Asian Firms: History, Institutions, Management (2007). He confesses to being American, white, male, Protestant (although Presbyterian, not Episcopalian as the Morgan partners), and upper middle class (no member of the family has ever purchased their silverware; it is given, or inherited). His local council joined a class action suit to recover a portion of the funds invested in collateralised debt obligations purchased from Morgan Stanley before the GFC. Ben is currently working on a series of crime novels set in Melbourne, where he lives part-time and supports Collingwood.