In 1998, a commercial for IBM's Lotus division danced across American television screens to the tune of REM's Nietzschean anthem, "I Am Superman". As throngs of humanity went about their business, a tiny caption asked: "Who is everywhere?" In response, IBM identified itself both with the people and with the name of God as revealed to Moses: the words "I Am" scrawled roughly on a piece of cardboard and held aloft from amid the madding crowd. The questions continued, running down the list from omnipresence to omniscience and omnipotence - "Who is aware?", "Who is powerful?" - while scenes of entrepreneurial achievement pulsated by: an American business district, a Chinese garment factory, a microchip assembly room, and the seat of divine judgement itself, the trading floor of the New York Stock Exchange. "I can do anything," sang a winsome computer voice.
If there was something breathtaking about this particular bit of corporate autodeification, there was also something remarkably normal about it. Americans had already made bestsellers of books such as God Wants You to be Rich and Jesus, CEO. "The Market's Will be Done" was the title that Tom Peters, guru of gurus, chose for a chapter of his bestselling 1992 management book, while the techno-ecstatic Kevin Kelly, in his Out of Control (1994), referred to his list of "new economy" pointers as "The Nine Laws of God".
What the term new economy really describes is not some novel state of human affairs but the final accomplishment of the long-standing agenda of the richest class. Once, Americans imagined that economic democracy meant a reasonable standard of living for all - that freedom was only meaningful once poverty and powerlessness had been overcome. Today, American opinion leaders seem convinced that democracy and the free market are simply identical. There is little that is new about this idea, either: for nearly a century, equating the market with democracy was the familiar defence of any corporation in trouble with union or government. What is new is this idea's triumph over all its rivals; the determination of American leaders to extend it to all the world; the belief among opinion-makers that there is something natural, something divine, something inherently democratic about markets.
Wherever one looked in the 1990s, entrepreneurs were occupying the ideological space once filled by the labour movement. It was businessmen who were sounding off against the arrogance of elites, railing against the privilege of old money, waging a relentless war on hierarchy. They were market populists, adherents of the most powerful political mythology of the age.
Their fundamental faith was a simple one. The market and the people were essentially one and the same. By its very nature, the market was democratic, perfectly expressing the popular will through the machinery of supply and demand, poll and focus group, superstore and internet. In fact, the market was more democratic than any of the formal institutions of democracy - elections, legislatures, government. The market was infinitely diverse, permitting without prejudice the articulation of all tastes and preferences. Most importantly of all, the market was militant about its democracy. It had no place for snobs, for hierarchies, for elitism, for pretence.
As the Newsweek columnist Robert Samuelson said in 1998, "the market 'R' us". Whatever the appearances, it acted always in our interests, on our behalf, against our enemies. This is how the New York Stock Exchange, long a nest of privilege, could be understood in the 1990s as a house of the people; how any niche marketing could be passed off as a revolutionary expression - an empowerment, even - of the demographic at which it was aimed.
Market populism was just the thing for a social order requiring constant doses of legitimacy. It builds all manner of populist fantasies: of businessmen as public servants, of industrial and cultural production as a simple reflection of popular desire, of the box office as a voting booth. By consuming the fruits of industry, we the people are endorsing the industrial system, voting for it in a plebiscite far more democratic than a mere election.
As business leaders melded themselves theoretically with the people, they found powerful arguments against those who sought to regulate or control private enterprise. Since markets express the will of the people, virtually any criticism of business could be described as despicable contempt for the common man. According to market populism, elites were no longer those who spent their weekends at Club Med or watched sporting events from a skybox or fired half their workforce and shipped the factory south. Since the rich - particularly the new rich - were the chosen of the market, they were the very emblem of democratic modesty, humble adepts of the popular will. Elitists were the people on the other side of the equation: the labour unions and Keynesians who thought that society could be organised in any way other than the market way. Since what the market did - no matter how whimsical, irrational or harmful - was the will of the people, any scheme to operate outside its auspices or to control its ravages was by definition a dangerous artifice, the hubris of false expertise.
This fantasy of the market as an anti-elitist machine was couched in the language of social class. Businessmen and right-wing politicians have always deplored the use of "class war" by their critics on the left; during the 1990s, though, they happily used the tactic themselves, depicting the workings of the market as a kind of permanent social revolution in which daring entrepreneurs were endlessly toppling fat cats and snatching away the millions of the lazy rich kids. The new economy was a narrative of class warfare: wherever its dynamic new logic touched down, old money was said to quake and falter. Opera-going chief executives were giving way to those who wore goatees and fancied the rhymes of the street; the scions of ancient banking families were finding their smug selves wiped out by the new-jack trading of a working-class kid; the arrogant stockbrokers of old were being humiliated by the online day-traders; white men were getting their asses kicked by women, Asians, Africans, Hispanics.
Market populism encompasses such familiar set pieces as Rupert Murdoch's endless efforts to cast himself as a man of the people beset by cartoon snobs such as the British aristocracy; or Detroit's long-running use of Americans' liking for cars to depict even the most practical and technical criticisms of the automobile industry (seat belts, airbags, fuel efficiency and so on) as loathsome expressions of a joyless elite. When the public began to sour on the big American cars of the 1950s, according to the culture critic John Keats, "Detroit decided . . . that the criticism was nothing but a lot of nittering and nattering emanating from a few aesthetes and intellectuals from the effete East - from the kind of people who drove Volkswagens and read highbrow magazines just to show off".
In the 1990s, these fantasies flowered spectacularly. Not only was the new economy, that vision of the market unbound, believed to be crushing the privilege of inherited wealth, but it was also said to constitute a standing refutation of the learning of traditional elites. Its stock market valuations, so puzzling to economists and old brokerage hands, were crystal clear to the little guy. New economy companies were doing without entire layers of experts and bureaucrats; they were turning their backs on standard methods of teaching and learning; they were tearing up the carefully designed flow charts and job descriptions of old.
Historically, populism was a rebellion against the corporate order, a political tongue reserved by definition for the non-rich and the non-powerful. The "common people" were the working class: the "elite" the owners and managers of industry.
From 1968, this primal set piece of American democracy changed its stripes. The war between the classes somehow reversed polarity. It was now a conflict in which the patriotic, blue-collar "silent majority" (along with their employers) faced off against a new elite, the "liberal Establishment", and its spoiled, flag-burning children. This new ruling class - liberal journalists, liberal academics, liberal politicians and the shadowy powers of Hollywood - earned the people's wrath not by exploiting workers or ripping off family farmers, but by showing contemptuous disregard for the wisdom and values of average Americans. Backlash populism proved immensely powerful and for 30 years right-wing populists were forever reminding "normal Americans" of the hideous world that the "Establishment" had built, a place where blasphemous intellectuals violated the principles of Americanism at every opportunity, a place of crime on the streets, of unimaginable cultural depravity, of disrespect for men in uniform, of judges gone soft on crime and politicians gone soft on communism.
In 1988, George Bush managed to win the presidency by spreading alarm about flag-burning, a now non-existent threat that older voters remembered with horror from 20 years before. This was not a trick that could be repeated too many more times. Even though the culture wars reached their outrageous peak in the decade that followed - the bombing of abortion clinics and government buildings, the brief notoriety of gun shows and right-wing militias, the impeachment of President Clinton - they also began visibly to subside. It was during the impeachment proceedings that the backlash, running now on little more than 30-year-old rage, reached a state of obvious exhaustion. The public was slipping away. In the battle of the focus groups, the president was winning easily. Nobody seemed to care any more about the betrayal of the bureaucrats, about the secular humanists' designs on family values, about the flag-burning kids from the rich suburbs, or even about the communistic professors, trashing the great books and blaming America first. Clearly, something new was needed.
This was where market populism came to the rescue. Backlash populism had envisioned a scheming liberal elite whose members thought they knew what was best for us - bussing, integration, the coddling of criminals. Market populism simply shifted the inflection. Now the crime of the elite was not so much an arrogance in matters of values but in matters economic. Still, those elitists thought they were better than the people, but now their arrogance was revealed by their passion to raise the minimum wage, to regulate, oversee, redistribute and tax.
But there were other critical differences. While the backlash had been proudly square, market populism was cool. Far from despising the 1960s, it broadcast its fantasies to the tune of a hundred psychedelic hits. Its leading think-tanks were rumoured to pay princely sums to young people who could bring some smattering of rock'n'roll street cred to the market's cause. And believing in the market rather than God, it had little need for the Christian right and the moral majority. It dropped the ugly race-baiting of the previous right-wing dispensation, choosing instead to imagine the market as a champion of the downtrodden. Market populism abandoned the "family values" of Ronald Reagan; it gave not a damn for the traditional role of women or even of children. The more who entered the workforce, the merrier.
This change has been difficult for many to grasp. For writers schooled in the culture wars, the most important conflict was and will always be the one between the hip and the square, the flag-burning and the church-going, the hippie and the suit. But as the 1990s progressed, as jeans replaced suits in the offices of America and as the ultra-hip culture of cyberspace became the culture of the corporation generally, business increasingly imagined itself on the other side of the equation.
For the majority of American workers, wages in the 1990s either fell or barely kept pace with inflation. But for top corporate executives these really were years in which to stand up and say "I Am". Between 1990 and 1999, chief executive income went from 85 times more than what average blue-collar employees got to around 475 times more. In Japan, meanwhile, that multiple stood at about 11 times, and in Britain - the country most enamoured of new economy principles after the US itself - 24 times.
Market populism, and the concept of the new economy, have helped to legitimise all this. They add up to a set of beliefs that, once enacted into public policy, has permitted an upward transfer of wealth unprecedented in our lifetimes; it is a collection of symbols and narratives that understand the resulting wealth polarisation as a form of populism, as an expression of the people's will.
It is a fraud. The formula "one dollar, one vote" - invented by the influential New York Times columnist Thomas Friedman - is not the same thing as universal suffrage, as the complex, hard-won array of rights that most Americans understand as their political heritage. Nor does it mitigate the obscenity of wealth polarisation one whit when the richest people ever in history tell us they are "listening" to us, that theirs are "interactive" fortunes, or that they have unusual tastes and work particularly hard. Markets may look like democracy, in that we are all involved in their making, but they are fundamentally not democratic. We did not vote for Bill Gates; we didn't all sit down one day and agree that we should only use his operating system and we should pay for it just however much he thinks is right. We do not go off to our jobs checking telephone lines or making cold calls or driving a forklift every morning because this is what we want to do: we do it because it is the only way we can afford food, shelter and medicine. The logic of business is coercion, monopoly and the destruction of the weak, not "choice" or "service" or universal affluence.
"Democracies prefer markets but markets do not prefer democracies," writes the political scientist Benjamin Barber in Jihad vs McWorld, one of the most thoughtful recent books on the new capitalism. "Having created the conditions that make markets possible, democracy must also do all the things that markets undo or cannot do." Markets are interested in profits and profits only; service, quality and general affluence are different functions altogether. The universal, democratic prosperity that Americans now look back to with such nostalgia was achieved only by reining in markets, by the gargantuan effort of mass, popular organisations such as labour unions and of the people themselves, working through a series of democratically elected governments not daunted by the myths of the market.
The thinkers behind market populism have a word for this argument: they call it "cynicism". One comes across denunciations of this cynicism constantly from journalists, advertising executives, futurists, management theorists, stock market gurus. The correct intellectual posture, they admonish, is the simple faith of childhood. Indeed, children of the most exaggerated guilelessness turn up everywhere in the corporate speech of the 1990s, hailing the glory of the internet, announcing corporate mergers, staring awestruck at new computers, clarifying the bounds of history, explaining the fantastic surge of the Dow, and raising their winsome voices to proclaim the unanswerable new management logic that showed - as all previous management logics had also shown - just why it was that labour must submit to capital.
The masters of the new economy may fancy themselves an exalted race of divinities, but they counsel the rest of us to become as little children before the market.
Copyright 2000 Thomas Frank
Thomas Frank is a founding editor of the American magazine The Baffler. This essay is extracted from One Market Under God, published by Secker and Warburg on 9 January (£18.99)