5, No. 1, December 2003
In the Spring
2003 Newsletter, an incorrect version Lisa Penaloza's article
was published without references. Here is the correct, complete
version. My apologies to Lisa.--DC
Capitalist Challenge to Democracy in U.S. Multicultural Society*
of Business, University of Colorado, Boulder
although difficult, are vital in defining what we stand for as
a nation and people. 9-11 has been that for us, and in various
ways journalists, politicians, intellectuals, businesspeople,
workers, housewives, men, women, and children have struggled to
understand what our nation has come to represent to ourselves
and others across the world.
of America is business, we were told almost immediately after
the towers came down. Go shopping. Consuming had become a patriotic
duty, second perhaps only to supporting troops in wartime-most
recently redefined as preemptive bombing. As a professor of marketing
who specializes in consumer behavior, hearing all this is very
interesting, especially in contrast to the larger history of our
nation in standing for freedom and democracy.
How is it
that capitalism and democracy have become so intertwined, I wondered,
turning this into a question for research and classroom discussion.
In talking to students last fall and spring, I listed the two
terms on the chalkboard, and asked the students what they brought
to mind. Opportunity to get ahead, many said, opportunity to make
money, to have a better life. Freedom to do what we want. Students
who had traveled compared the U.S. to other countries. Economic
concerns were central, and perhaps to be expected from business
students. Still, I remained puzzled as to why freedoms of speech,
press, assembly, due process, and religion were not raised until
much later, after I prodded them that only the left column, capitalism,
had been addressed; with the right one, democracy, empty. The
lopsidedness of this exercise made me wonder whether the one,
capitalism, has overtaken the other, democracy, in contemporary
much reading, I have come to understand better how deeply capitalism
and democracy have been intertwined historically. The Latin words
forum (town center) and marcellum (market) were indistinguishable
over two thousand years ago (Frayn 1993), an inheritance from
Greek and Middle Eastern societies we retain in our contemporary
understandings of the forum as the birthplace of democratic governance.
Since then, claims for general political liberties have sprung
alongside specific economic gains, leaving both domains inextricably
connected. For example, take our own revolution from Britain.
The war cry, "No taxation without representation," went well beyond
the indignation of merchants, to fuel popular consciousness in
mobilizing our leaders to build a more free, more just nation
(Wood 1991).. Roughly a decade later, French calls for "Liberté,
Egalité, Fraternité" captured public imagination
well beyond the interests of the bourgeoisie in keeping more of
their profits from oppressive aristocrats (Lefebvre 1971).. In
both cases the significance of these battles has been anchored
in immediate economic gain, yet has transcended it, in providing
the basis for more general human rights.
impulses in the U.S. since the late 1700's took a decidedly social
turn from their early economic origins, in providing what we recognize
today as the basic rights and freedoms of more and more people.
Important landmarks include the freeing of African and African
American slaves in 1865, enfranchising women in 1920, and providing
those of all religions, races, and ethnicities from unequal treatment
before the law by 1965. Notably, social movement activism has
played an integral role in bringing about each subsequent wave
of political enfranchisement, in the efforts of African-American,
Asian, Chicano/a, Women, and Gay and Lesbian activists. However,
as Taylor (1992) notes, these political rights are fundamentally
individualistic in nature, which has proved to be an obstacle
to the extension of rights to cultural groups.
So what is
the nature of this capitalist challenge to democracy in multicultural
society? The market is organized in ways distinct from our political
system, even as both are conflated today. More specifically, both
market capitalism and political democratic systems recognize people
in different ways, and in doing so, reproduce and disrupt existing
social relations and hierarchies. For example, common laments
in multicultural societies such as the U.S. are fragmentation
and the loss of a sense of collective unity, such that the nation
is breaking into groups divided in ways of life and values, and
unable to live together. It is not clear how much of this resistance
is due to multiculturalism in the market, as opposed to government
enfranchisement. Others suggest that the problem is not enough
democracy-that while "minorities" have been recognized by government
for decades, and are increasingly recognized and targeted by firms,
the people within these neighborhood enclaves cum consumer niches
remain outside our collective sense of what it means to be American,
and subordinated socio-economically.
capitalist markets have less trouble recognizing groups, as one
after another major corporations have scrambled to target the
Black, Latino/a, and gay markets (Gabriel 1994; Davila 2001; Penaloza
1996). Dramatic demographic shifts in the social fabric of the
nation are a key factor in stimulating managers to develop increasingly
specialized and inclusive economic activities. Latinos and Blacks
will one day soon constitute the new mainstream of our nation.
Already these two groups together outnumber Whites in most of
our major cities.
the reformist solution for more inclusion in social institutions,
such as schools, health care, and government services does not
acknowledge the nature of the mainstream resistance mentioned
earlier (see San Juan Jr. for an excellent review and critique
of these positions). Arguments such as "minorities are the future
of this country, the future of whole towns and cities, schools,
and even Social Security" fall on deaf ears when too many Whites
cannot imagine a shared fate with ethnic/racial/gender minorities.
forth our desired mix of capitalism and democracy, it is important
to get past the hype of markets and seriously examine what they
can and cannot do in terms of their impacts on our respective
communities and to our nation overall. Take Latinos/as today.
Market attention has its pluses and minuses. Look at J. Lo or
Ricky Martin. An informant in my study of Mexican Americans in
San Antonio refers to it as "Pop Mexican." My cousin tells my
grandma how cool it is to have a Spanish last name. It was not
always so cool. San Antonio is a nice city, maybe you've been
there, gone down to the River Walk, or to the Mercado (marketplace)..
Tourism is all about Mexican and Mexican American culture, yet
it appears limited in its ability to develop the local Mexican
and Mexican American communities.
We must reconsider
the role of government with respect to business in our increasingly
multicultural society and global economy. Many have convinced
us over the past twenty years that what we need is less government
and more markets. Freedoms historically associated with the political
arena, like Freedom of Speech, Press, and Assembly are increasingly
played out in the market, with the dollar compared to the vote,
and polls and focus groups increasingly used as the basis for
political legitimization (Laufer and Paradeise 1990).. This is
especially noteworthy when viewed from the perspectives of Latinos/as
and Blacks. For many of our freedoms have been hard fought at
the level of government-Civil Rights Legislation, and Affirmative
Action; even as much of the early civil rights activism was directed
at businesses-lunch counters, retail stores, the media, and workplaces
(Penaloza, 1995). Upon closer examination, the temporal sequence
is significant. These recent economic inclusions have taken place
after political incorporation accomplished by very strong social
is increasingly equated with consumer choice. Yet, a close examination
reveals the former far exceeds the latter. It was political freedom,
after all, that motivated people to tear down the wall in Berlin,
not consumer choice, although again both were implicated. When
the wall came down people proclaimed the triumph of capitalism.
At the same time, we built a wall between the U.S. and Mexico.
This is the other side of that triumph; keeping people out of
the U.S., versus keeping them in East Germany. The questions this
wall raises regarding the nexus of capitalism and democracy are
much harder, namely why our foreign and domestic economic policy
supports free capital flows and free product flows in globalization,
but not free flows of people? Technically, free markets require
"free markets" are neither. Historically capitalism has required
an exorbitant amount of government intervention to function, in
our nation and elsewhere (Chua 2003). Subsidies in building the
railroads and freeways, airplanes and the World Wide Web have
built our infrastructure, helping make U.S. commerce so effective.
Also critical have been military efforts alternatively paving
the way for, and protecting investments and market development,
beginning with the genocide of Native Americans, and continuing
through the collateral damage in Iraq ten years ago and more recently
in Afghanistan. Over time regulations, legislation and federal
agencies such as the Antitrust Acts, the Federal Deposit Insurance
Corporation, and the Social Security Administration have been
integral in tempering the excesses of markets; holding businesses
to our economic ideals of competition, as well as to social ideals
of justice and inclusion. Today we are again appreciating their
importance on an almost daily basis in government attempts to
deal with the Enron/Anderson/Worldcom scandals.
are needed to develop communities. Yet if we have learned anything
from the accounting scandals and stock market losses of today,
it is that markets require political oversight to be fair. A growing
number of people in the world also believe they should be just.
They are located worldwide and organizing for democratic participation
and more equitable distribution of resources in the International
Monetary Fund and World Bank (Danaher 2001). To hold markets to
the highest political and economic ideals may well turn out to
be the most radical act of all.
We can work
towards greater consistency between our democratic, political
ideals and our capitalist, economic ones, but only so long as
we understand the differences between these two important domains.
Our rightful place in world political and economic leadership
should be based on understanding markets at the level of lived
experience, with a profound sense of the role of government in
ensuring political and economic justice, such that the powerful
ideals of freedom, equality, and opportunity are not rendered
caricatures in the service of the market order, but rather so
they ring true to the democratic ideals held dear throughout this
nation and by others with whom we share this planet.
note: Portions of this column are taken from the article, "Multiculturalism
in the New World Order, forthcoming, in Elusive Consumption:
Tracking New Research Perspectives, Karin Ekstrom and Helene
Brembeck, eds. Oxford, UK: Berg Publishers.
(2003), World on Fire: How Exporting Free Market Democracy
Breeds Ethnic Hatred and Global Instability, New York: Doubleday.
Kevin (2001), Democratizing the Global Economy, Monroe,
ME: Common Courage Press.
(2001), Latinos, Inc.: The Marketing and Making of a People,
Berkeley, CA: University of California Press.
M. (1993), Markets and Fairs in Roman Italy, New York,
NY: Oxford University Press.
John (1994), Racism, Culture, Markets, London: Routledge.
and Catherine Paradeise (1990), Marketing Democracy: Public
Opinion and Media Formation in Democratic Societies, New
Brunswick, NJ: Transaction Publishers.
Georges (1971), The Coming of the French Revolution, first
printing 1939, translated by R.R. Palmer, Princeton, NJ: Princeton
Lisa (1996), "A Critical Perspective on the Accommodation of Gays
and Lesbians in the U.S. Marketplace," Journal of Homosexuality,
31:1/2 (Summer) 9-41.
"Immigrant Consumers: Marketing and Public Policy Implications,"
Journal of Public Policy and Marketing, 14:1 (Spring)
E. Jr. (2002), Racism and Cultural Studies: Critiques of Multiculturalist
Ideology and the Politics of Difference, Durham, NC: Duke
S. (1991), The Radicalism of the American Revolution,
New York: Vintage Books.